EXHIBIT 10.6
STANDARD COMMERCIAL LEASE
ARTICLE 1. BASIC LEASE TERMS
1.1 PARTIES. This lease agreement ("Lease") is entered into this 31st
day of October, 2002, by and between 321 Corporation, a Minnesota Limited
Liability Corporation ("Landlord") and Insignia Systems, Inc. a Minnesota
Corporation ("Tenant").
1.2 PREMISES. In consideration of the rents, terms, provisions and
covenants of this Lease, Landlord hereby leases, lets and demises to Tenant the
following described premises ("Premises") as illustrated on Exhibit A attached
hereto: approximately 47,000 square feet of office/warehouse space located at
0000 Xxxxxxxx Xxxxx, Xxxxx Xxxxx, XX 00000, Minnesota ("Building") which
consists of approximately 79,937 square feet, as legally described on Exhibit B
attached hereto. The square footage of the Premises was calculated by a
certified and registered architect in accordance with the ANSI/BOMA standard for
measuring floor area publication dated June 7,1996. The improvements to the
Premises shall consist of the Schedule of Additional Leasehold lmprovements
attached hereto as Exhibit D which shall detail the improvements, if any, to be
installed at the expense of Landlord or Tenant, as set forth on Exhibit D.
1.3 TERM. Subject to and upon the conditions set forth herein, the term
of this Lease shall commence on January 15, 2003 the "Commencement Date") and
shall terminate eighty-four (84) months thereafter on January 14, 2010, unless
sooner terminated or extended as hereinafter provided.
1.4 BASE RENT. Base rent is:
Month Monthly Base Rent
1-60 $49,741.67
61-84 $49,741.67 plus the percentage
increase in the CPI from 1/1/03--
12/31/07.
1.5 ADDRESSES.
Landlord's Address: Tenant's Address:
c/o Hoyt Properties, Inc. Insignia Systems, Inc.
000 Xxxxx Xxxxx Xxxxxx 0000 Xxxxxxxx Xxxxx
Xxxxx 000 Xxxxx Xxxxx, XX 00000
Xxxxxxxxxxx, XX 00000
1.6 PERMITTED USE. General office and warehouse and printing
operations.
1.7 SECURITY DEPOSIT. -0-
1.8 PRO RATA SHARE. 58.67% subject to adjustment as provided in Section
2.2 hereof.
1.9 EARLY OCCUPANCY. It is agreed and understood that Tenant shall have
Early Occupancy of the Premises on December 1, 2002 for the purpose of facility
set-up as well as operating its business. It is also agreed and understood that
for such early occupancy period (December 1, 2002 and including January 14,
2003) Tenant shall be under all the terms and conditions of this Lease including
providing proof of insurance coverage and converting gas and electrical service
to Tenant's account except Tenant shall not be required to pay Base Rent and
Operating Expenses. If early occupancy on December 1, 2002 cannot be achieved
the Commencement Date shall be extended by the same number of days that it took
beyond December 1, 2002.
1.10 RIGHT OF FIRST REFUSAL. Tenant shall have the right of first
refusal for any contiguous space that becomes available during the Lease Term.
ARTICLE 2. RENT
2.1 BASE RENT. Tenant agrees to pay monthly as base rent during the
term of this Lease the sum of money set forth in Section 1.4 of this Lease,
which amount shall be payable to Landlord at the address shown above. One
monthly installment of rent shall be due and payable on the date of execution of
this Lease by Tenant for the first month's rent and a like monthly installment
shall be due and payable on or before the first day of each calendar month
succeeding the Rent Commencement Date during the term of this Lease; provided,
if the Rent Commencement Date should be a date other than the first day of a
calendar month, the monthly rental set forth above shall be prorated to the end
of that calendar month, and all succeeding installments of rent shall be payable
on or before the first day of each succeeding calendar month during the term of
this Lease. Tenant shall pay, as additional rent, all other sums due under this
Lease. Notwithstanding anything in this Lease to the contrary, if Landlord, for
any reason whatsoever (other than Tenant's default), cannot deliver possession
of the Premises to the Tenant on the Rent Commencement Date, this Lease shall
not be void or voidable, nor shall Landlord be liable to Tenant for any loss or
damage resulting therefrom, nor shall the expiration of the term be extended,
but all rent shall
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be abated until Landlord delivers possession. All base rent, additional rent and
other sums payable by Tenant pursuant to this Lease are payable without demand
and without any reduction, abatement, counterclaims or setoff.
2.2 OPERATING EXPENSES. Tenant shall also pay as additional rent
commencing on the Commencement Date, Tenant's pro rata share of the operating
expenses of Landlord for the Building and/or project of which the Premises are a
part. Landlord may invoice Tenant monthly for Tenant's pro rata share of the
estimated operating expenses for each calendar year, which amount shall be
adjusted from time-to-time by Landlord based upon anticipated operating
expenses. Within ninety (90) days following the close of each calendar year,
Landlord shall provide Tenant an accounting showing in reasonable detail all
computations of additional rent due under this Section. In the event the
accounting shows that the total of the monthly payments made by Tenant exceeds
the amount of additional rent due by Tenant under this Section, the accounting
shall be accompanied by evidence of a credit to Tenant's account. In the event
the accounting shows that the total of the monthly payments made by Tenant is
less than the amount of additional rent due by Tenant under this Section, the
accounting shall be accompanied by an invoice for the additional rent.
Notwithstanding any other provision in this Lease, during the year in which this
Lease terminates, Landlord, prior to the termination date, shall have the option
to invoice Tenant for Tenant's pro rata share of the operating expenses based
upon the previous year's operating expenses. If this Lease shall terminate on a
day other than the last day of a calendar year, the amount of any additional
rent payable by Tenant applicable to the year in which the termination shall
occur shall be prorated on the ratio that the number of days from the
commencement of the calendar year to and Including such termination date bears
to 365. Tenant agrees to pay any additional rent due under this Section within
ten (10) days following receipt of the invoice or accounting showing additional
rent due. Tenant's pro rata share set forth in Section 1.8 shall be equal to a
percentage based upon a fraction the numerator of which is the total area of the
Premises as set forth in Article 1, subject to adjustment as provided in this
Lease, and the denominator of which shall be the net rentable area of the
Building. Upon termination of the Lease, Landlord and Tenant agree to reconcile
within sixty (60) days any amounts due from either party for the over payment or
underpayment of operating expenses by Tenant.
2.3 DEFINITION OF OPERATING EXPENSES. The term "operating expenses"
includes all expenses incurred by Landlord with respect to the maintenance and
operation of the Building of which the Premises are a part, including, but not
limited to, the following: maintenance, repair and replacement costs;
electricity, fuel, water, sewer, gas and other common Building utility charges;
signage; equipment used for maintenance and operation of the Building; security
charges; security, window washing and janitorial services; trash and snow
removal; landscaping and pest control; management fees, wages and benefits
payable to employees of Landlord whose duties are directly connected with the
operation and maintenance of the Building; all services, supplies, repairs,
replacements or other expenses for maintaining and operating the Building or
project including parking and common areas; improvements made to the Building
which are required under any governmental law or regulation that was not
applicable to the Building at the time it was constructed; installation of any
device or other equipment which improves the operating efficiency of any system
within
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the Premises and thereby reduces operating expenses; all other expenses which
would generally be regarded as operating, repair, replacement and maintenance
expenses; all real property taxes and installments of special assessments,
including dues and assessments by means of deed restrictions and/or owners'
associations which accrue against the Building during the term of this Lease and
legal fees incurred in connection with actions to reduce the same; except that
Tenant shall have the right to approve legal fees associated with reducing
taxes; and all insurance premiums Landlord is required to pay or deems necessary
to pay, including fire and extended coverage, rent loss and public liability
insurance, with respect to the Building. Notwithstanding the foregoing,
operating expenses shall not include the following:
a) The cost of decorating, redecorating, special cleaning, or other
services not provided on a regular basis to all tenants of the Building.
b) Any costs associated with the initial interior or exterior
landscaping and the purchase, rental or maintenance of sculpture, paintings, or
other objects purporting to be art for the Building and Common Areas.
c) Landlord's general overhead except to the extent it is expended in
direct connection with the management and operation of the Building.
d) Wages, salaries, fees, and fringe benefits paid to administrative or
executive personnel or officers or partners of Landlord.
e) Any charge for depreciation or amortization (except as specifically
noted herein) of the Building or equipment.
f) All costs relating to activities for the solicitation and execution
of leases for space in the Building.
g) All costs for which Tenant or any other tenant in the Building is
being charged other than pursuant to similar "operating costs" clauses.
h) Except as provided in section i., the costs of structural repairs
and/or replacements including the cost of correcting defects in the construction
of the Building or other structures which are a part of the project and the
related equipment and any other costs that are considered to be of a capital
nature under generally accepted accounting principles consistently applied,
including, but not limited to, capital improvements, capital repairs, capital
equipment, capital tools, and other capital items.
i) Any such capital improvements made to reduce operation expenses may
be amortized over the longest useful life of improvement on a straight line
basis. The amount amortized in any year shall be an amount not to exceed the
amount of the net reduction or operating cost savings resulting in such year
from the improvements.
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j) Costs of initial cleaning of, and rubbish removal from, the building
to be performed prior to final completion of construction of the Building or
Common Areas.
k) The cost of any repair made by Landlord because of the total or
partial destruction of the Building or the condemnation of a portion of the
Building.
l) Repairs, alterations, additions, improvements or replacements made
to rectify or correct any defect
m) Repairs or replacements covered by warranties or guaranties to the
extent of service or payment thereunder.
n) Any insurance premium to the extent that Landlord is entitled to be
reimbursed for it by Tenant pursuant to Tenant's Lease or by any tenant of the
Building pursuant to a similar lease other than pursuant to causes comparable to
this "operating costs" clause and any insurance premium increase caused by
rerating of the Building caused by other tenants' uses.
o) The costs of any items for which Landlord is reimbursed by insurance
or otherwise compensated by a tenant or another party other than by tenant of
the Building pursuant to clauses similar to this "operating costs" clause.
p) Any operating cost representing an amount paid to Landlord or a
related corporation, entity or person which is in excess of the amount which
would be paid in the absence of such a relationship.
q) The cost of any work or services performed for or facilities
furnished to any tenant of the Building to a greater extent or in a manner more
favorable to such tenant than performed or furnished to tenant.
r) Costs, including costs of plans, construction, permit, license and
inspection costs, incurred with respect to the installation of tenant
improvements made for tenants in the Building or incurred in renovating or
otherwise improving, decorating, painting or redecorating vacant space for
tenant or other occupants of the Building.
s) The cost of regular and overtime wages and salaries or any other
expenses to Landlord in curing its defaults or performing work expressly
provided in this Lease to be borne at Landlord's expense.
t) Any costs, fines, or penalties incurred due to violation by the
Landlord of any laws or other governmental rule or authority.
u) Damage and repairs necessitated by the negligence or willful
misconduct of Landlord or Landlord's employees, contractors or agents.
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v) Promotional and advertising expense.
w) Attorney's, accountants and other professionals fees and expenses
incurred in connection with: negotiations or disputes with tenants, other
occupants, or prospective tenants or other occupants; accounting, legal or other
professional fees relating to the ownership, construction, sale or any
litigation relating to the Building or the Project except as specifically
provided in this Lease.
x) Finance charges, interest and other payments on any mortgages and/or
other debt encumbering the Building or Common Areas, or obligation in the nature
of a mortgage or other project financing and rental payments on any ground lease
or other underlying lease.
y) Rental payments incurred in leasing air conditioning systems,
elevators or other equipment ordinarily considered to be of a capital nature,
except operating/maintenance equipment not affixed to the Building or Common
Areas which is used in providing janitorial or similar services.
z) The costs resulting from Landlord's default or from the default of
any other tenant.
aa) The costs for any activity (including but not limited to legal
fees) associated. with the removal, correction or clean up of toxic or hazardous
waste in the Building, Premises or future expansion areas or the project.
bb) Costs relating to compliance with laws regarding CCFC's and HCFC's.
cc) Any costs associated with modifications made to the Building in
order to comply with the requirements of laws including without limitation the
Americans with Disabilities Act.
dd) Any property management fee (or similar operating agreement fee)
shall be as charged as an operating expense to all other Building tenants, but
in no event shall be in excess of 5% of all Base Rent and Additional Rent
payable by Tenant to Landlord hereunder and shall include all costs associated
with the delivery of such service including, but not limited to, the property
management office and all other building personnel except building engineer(s)
and janitorial services.
ee) Any charge for Landlord's income tax. excess profit tax, franchise
tax, gross receipts, or like tax on Landlord's business or resulting from
Tenant's lease with Landlord.
ff) Except on a temporary basis (not to exceed one (1) month) in cases
of emergency or except for items as to which Tenant shall specifically agree in
advance in writing, the costs of renting or leasing capital items, the cost of
which could not be amortized
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as an operating expense under (i) above but such costs may be included in
amortization of capital improvements made to reduce operating expenses to the
extent permitted in section i.
gg) Auditing fees.
hh) The cost of subscriptions, political donations, professional fees
(except as specifically provided in the Lease), travel costs, automobile
allowance, entertainment and all other dues and donations.
ii) Insurance expense and costs incurred for other than Building
Operations (including without limitation rent insurance, Directors and Officers
insurance and personal general liability insurance for any employee of
Landlord).
jj) Insurance any charges that would result in Landlord collecting in
excess of one hundred percent (100%) of all Operating Expenses.
kk) No profit or administrative charges shall be included in Operating
Expenses.
2.4 LATE PAYMENT CHARGE. If the monthly rental payment or any other
payment due from Tenant to Landlord is not received by Landlord on or before the
due date thereof, Landlord shall be entitled to exercise any remedy for
nonpayment provided in this Lease and, in addition, if such payment is not
received on or before five (5) days after the due date, a late payment charge of
five percent (5%) of such past due amount shall become due and payable by Tenant
in addition to such amounts owed under this Lease.
2.5 INCREASE IN INSURANCE PREMIUMS. If an increase in any insurance
premiums paid by Landlord for the Building is caused by Tenant's use of the
Premises or if Tenant vacates the Premises and causes an increase in such
premiums, then Tenant shall pay as additional rent the amount of such increase
to Landlord.
2.6 HOLDING OVER. In the event that Tenant does not vacate the Premises
upon the expiration or termination of this Lease, Tenant shall be a tenant at
will for the holdover period and all of the terms and provisions of this Lease
shall be applicable during that period, except that Tenant shall pay Landlord as
base rental for the period of such holdover an amount equal to one and one-half
(1-1/2) times the base rent which would have been payable by Tenant had the
holdover period been a part of the original term of this Lease, together with
all additional rent as provided in this Lease. Tenant agrees to vacate and
deliver the Premises to Landlord upon Tenant's receipt of notice from Landlord
to vacate. The rental payable during the holdover period shall be payable to
Landlord on demand. No holding over by Tenant, whether with or without the
consent of Landlord, shall operate to extend the term of this Lease.
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ARTICLE 3. OCCUPANCY AND USE
3.1 USE. Tenant warrants and represents to Landlord that the Premises
shall be used and occupied only for the purpose as set forth in Section 1.6.
Tenant shall occupy the Premises, conduct its business and control its agents,
employees, invitees and visitors in such a manner as is lawful, reputable and
will not create a nuisance. Tenant shall not permit any operation which emits
any odor or matter which intrudes into other portions of the Building, use any
apparatus or machine which makes undue noise or causes vibration in any portion
of the Building or otherwise interfere with, annoy or disturb any other lessee
in its normal business operations or Landlord in its management of the Building.
Tenant shall neither permit any waste on the Premises nor allow the Premises to
be used in any way which would in the opinion of Landlord, be extra hazardous on
account of fire or which would in any way increase or render void the fire
insurance on the Building.
3.2 SIGNS. No sign of any type or description shall be erected, placed
or painted in or about the Premises or project except those signs submitted to
Landlord in writing and approved by Landlord in writing, and which signs are in
conformance with Landlord's sign criteria established for the project, attached
hereto as Exhibit E.
3.3 COMPLIANCE WITH LAWS, RULES AND REGULATIONS. Tenant, at Tenant's
sole cost and expense, shall comply with all laws, ordinances, orders, rules and
regulations of state, federal, municipal or other agencies or bodies having
jurisdiction over the use, condition or occupancy of the Premises. Tenant will
comply with the rules and regulations of the Building adopted by Landlord,
including those attached hereto as Exhibit F. Landlord shall have the right at
all times to change and amend the rules and regulations in any reasonable manner
as may be deemed advisable for the safety, care, cleanliness, preservation of
good order and operation or use of the Building or the Premises. All changes and
amendments to the rules and regulations of the Building will be sent by Landlord
to Tenant in writing and shall thereafter be carried out and observed by Tenant.
Landlord agrees to enforce any such rules and regulations in a
non-discriminatory manner.
3.4 WARRANTY OF POSSESSION. Landlord warrants that it has the right and
authority to execute this Lease, and Tenant, upon payment of the required rents
and subject to the terms, conditions, covenants and agreements contained in this
Lease, shall have possession of the Premises during the full term of this Lease
as well as any extension or renewal thereof. Landlord shall not be responsible
for the acts or omissions of any other lessee or third party that may interfere
with Tenant's use and enjoyment of the Premises.
3.5 RIGHT OF ACCESS. Landlord or its authorized agents shall at any and
all reasonable times upon reasonable verbal notice have the right to enter the
Premises to inspect the same, to show the Premises to prospective purchasers or
lessees, and to alter, improve or repair the Premises or any other portion of
the Building, however Landlord agrees to not show the Premises to prospective
Lessee's prior to six (6) months before lease expiration unless otherwise
permitted. Landlord shall have the right to use any and all means which Landlord
may deem proper to open any door in an emergency without liability therefore.
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Tenant shall permit Landlord to erect, use, maintain and repair pipes, cables,
conduits, plumbing, vents and wires in, to and through the Premises as often and
to the extent that Landlord may nor or hereafter deem to be necessary or
appropriate for the proper use, operation and maintenance of the Building.
3.6 ACCEPTANCE. Upon substantial completion of Landlord's work,
Landlord and Tenant shall schedule a walkthrough inspection of the Premises and
shall mutually agree upon a list of punchlist items. Landlord shall diligently
proceed to complete such punchlist items. Subject to completion of such
punchlist, the commencement by Tenant of any business in the Premises shall
constitute an acknowledgment that the Premises are in the condition called for
in this Lease and that Landlord has performed all of Landlord's work.
ARTICLE 4. UTILITIES AND SERVICE
4.1 BUILDING SERVICES. Tenant shall pay when due, all charges for
utilities furnished to or for the use or benefit of Tenant or the Premises.
Tenant shall have no claim for rebate of rent on account of any interruption in
service unless caused by Landlord or Landlord's agent negligence or misconduct.
4.2 THEFT OR BURGLARY. Landlord shall not be liable to Tenant for
losses to Tenant's property or personal injury caused by criminal acts or entry
by unauthorized persons into the Premises or the Building.
ART1CLE 5. REPAIRS AND MAINTENANCE
5.1 LANDLORD REPAIR. Landlord shall not be required to make any
improvements, replacements or repairs of any kind or character to the Premises
or the Building during the term of this Lease except as are set forth in this
Section. Landlord shall maintain only the roof, foundation, parking and common
areas, the structural soundness of the exterior walls, doors, corridors, and
other structures serving the Premises, provided, that Landlord's cost of
maintaining, replacing and repairing the items set forth in this Section are
operating expenses subject to the additional rent provisions in Section 2.2 and
2.3. Landlord shall not be liable to Tenant, except as expressly provided in
this Lease, for any damage or inconvenience, and Tenant shall not be entitled to
any abatement or reduction of rent by reason of any repairs, alterations or
additions made by Landlord under this Lease.
5.2 TENANT REPAIRS. Tenant shall, at all times throughout the term of
this Lease, including renewals and extensions, and at its sole expense, keep and
maintain the Premises in a clean, safe, sanitary and first class condition and
in compliance with all applicable laws, codes, ordinances, rules and
regulations. Tenant's obligations hereunder
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shall include, but not be limited to, the maintenance, repair and replacement,
if necessary, of all heating, ventilation, air conditioning, lighting and
plumbing fixtures and equipment, fixtures, motors and machinery, all interior
walls, partitions, doors and windows, including the regular painting thereof,
all exterior entrances, windows, doors and docks and the replacement of all
broken glass. When used in this provision, the term "repairs" shall include
replacements or renewals when necessary and all such repairs made by the Tenant
shall be equal in quality and class to the original work. The Tenant shall keep
and maintain all portions of the Premises and the sidewalk and areas adjoining
the same in a clean and orderly condition, free of accumulation of dirt,
rubbish, snow and ice. If Tenant fails, refuses or neglects to maintain or
repair the Premises as required in this Lease after notice shall have been given
Tenant, in accordance with this Lease, Landlord may make such repairs without
liability to Tenant for any loss or damage that may accrue to Tenant's
merchandise, fixtures or other property or to Tenant's business by reason
thereof, and upon completion thereof, Tenant shall pay to Landlord all costs
plus ten percent (10%) for overhead incurred by Landlord in making such repairs
upon presentation to Tenant of xxxx therefor.
5.3 TENANT DAMAGES. Tenant shall not allow any damage to be committed
on any portion of the Premises or Building or common areas, and at the
termination of this Lease, by lapse of time or otherwise, Tenant shall deliver
the Premises to Landlord in as good condition as existed at the Commencement
Date of this Lease, ordinary wear and tear excepted. The cost and expense of any
repairs necessary to restore the condition of the Premises shall be borne by
Tenant.
ARTICLE 6. ALTERATIONS AND IMPROVEMENTS
6.1 LANDLORD IMPROVEMENTS. If construction to the Premises is to be
performed by Landlord prior to or during Tenant's occupancy, Landlord will
complete the construction of the improvements to the Premises in accordance with
plans and specifications agreed to by Landlord and Tenant, which plans and
specifications are made a part of this Lease by reference on Exhibit C & D.
Within seven (7) days of receipt of plans and specifications, Tenant shall
execute a copy of the plans and specifications and, if applicable, change orders
setting forth the amount of any costs to be borne by Tenant. In the event Tenant
fails to execute the plans and specifications and change order within the seven
(7) day period, Landlord may, at its sole option, declare this Lease canceled or
notify Tenant that the base rent shall commence on the completion date even
though the improvements to be constructed by Landlord may not be complete. Any
changes or modifications to the approved plans and specifications shall be made
and accepted by written change order or agreement signed by Landlord and Tenant
and shall constitute an amendment to this Lease. Landlord warrants that the
Premises and any such improvements completed by the Landlord shall comply with
all applicable laws, rules and regulations including ADA at the time of
occupancy by Tenant.
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6.2 TENANT IMPROVEMENTS. Tenant shall not make or allow to be made any
alterations or physical additions in or to the Premises without first obtaining
the written consent of Landlord, which consent may in the sole and absolute
discretion of Landlord be denied. Any alterations, physical additions or
improvements to the Premises made by Tenant shall at once become the property of
Landlord and shall be surrendered to Landlord upon the termination of this
Lease; provided, however, Landlord, at its option, may require Tenant to remove
any physical additions and/or repair any alterations in order to restore the
Premises to the condition existing at the time Tenant took possession, all costs
of removal and/or alterations to be borne by Tenant. This clause shall not apply
to moveable equipment or furniture owned by Tenant, which may be removed by
Tenant at the end of the term of this Lease if Tenant is not then in default and
if such equipment and furniture are not then subject to any other rights, liens
and interests of Landlord. Tenant shall have the right to make non-structural
alterations to the Premises under $10,000.00 without obtaining Landlord's
written approval. However, Tenant may elect to submit any such plans to Landlord
and request Landlord's approval at that time to not be responsible to remove
such alteration upon Lease Expiration. Tenant shall be permitted to install
security systems and phone systems and remove same at the termination of the
Lease.
ARTICLE 7. CASUALTY AND INSURANCE
7.1 SUBSTANTIAL DESTRUCTION. If all or a substantial portion of the
Premises or the Building should be totally destroyed by fire or other casualty,
or if the Premises or the Building should be damaged so that rebuilding cannot
reasonably be completed within one hundred eighty (180) working days after the
date of written notification by Tenant to Landlord of the destruction, or if
insurance proceeds are not made available to Landlord, or are inadequate, for
restoration, this Lease shall terminate at the option of Landlord by written
notice to Tenant within sixty (60) days following the occurrence, and the rent
shall be abated for the unexpired portion of the Lease, effective as of the date
of the written notification.
7.2 PARTIAL DESTRUCTION. If the Premises should be partially damaged by
fire or other casualty, and rebuilding or repairs can reasonably be completed
within one hundred eighty (180) working days from the date of written
notification by Tenant to Landlord of the destruction, and insurance proceeds
are adequate and available to Landlord for restoration, this Lease shall not
terminate, and Landlord shall at its sole risk and expense proceed with
reasonable diligence to rebuild or repair the Building or other improvements to
substantially the same condition in which they existed prior to the damage. If
the Premises are to be rebuilt or repaired and are untenaniable in whole or in
part following the damage, and the damage or destruction was not caused or
contributed to by act or negligence of Tenant, its agents, employees, invitees
or those for whom Tenant is responsible, the rent payable under this Lease
during the period for which the Premises are untenantable shall be adjusted to
such an extent as may be fair and reasonable under the circumstances. In the
event that Landlord fails to complete the necessary repairs or rebuilding within
one hundred eighty (180) working days from the date of written notification by
Tenant to Landlord of the destruction, Tenant may at its
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option terminate this Lease by delivering written notice of termination to
Landlord, whereupon all rights and obligations under this Lease shall cease to
exist.
7.3 PROPERTY INSURANCE. Landlord shall not be obligated in any way or
manner to insure any personal property (including, but not limited to, any
furniture, machinery, goods or supplies) of Tenant upon or within the Premises,
any fixtures installed or paid for by Tenant upon or within the Premises, or any
improvements which Tenant may construct on the Premises. Tenant shall maintain
property insurance on its personal property and shall also maintain plate glass
insurance. Tenant shall have no right in or claim to the proceeds of any policy
of insurance maintained by Landlord even if the cost of such insurance is borne
by Tenant as set forth in Article 2.
7.4 WAIVER OF SUBROGATION. Anything in this Lease to the contrary
notwithstanding, Landlord and Tenant hereby waive and release each other of and
from any and all right of recovery, claim, action or cause of action, against
each other, their agents, officers and employees, for any loss or damage that
may occur to the Premises, the improvements of the Building or personal property
within the Building, by reason of fire or the elements, regardless of cause or
origin, including negligence of Landlord or Tenant and their agents, officers
and employees. Landlord and Tenant agree immediately to give their respective
insurance companies which have issued policies of insurance covering all risk of
direct physical loss, written notice of the terms of the mutual waivers
contained in this Section.
7.5 HOLD HARMLESS. Neither party shall be liable to the other's
employees, agents, invitees, licensees or visitors, or to any other person, for
an injury to person or damage to property on or about the Premises caused by any
act or omission of either party, its agents, servants or employees, or of any
other person entering upon the Premises under express or implied invitation by
either party, or caused by the improvements located on the Premises becoming out
of repair, the failure or cessation of any service provided by Landlord
(including security service and devices), or caused by leakage of gas, oil,
water or steam or by electricity emanating from the Premises. Both parties agree
to indemnify and hold harmless the other party of and from any loss, attorney's
fees, expenses or claims arising out of any such damage or injury.
7.6 PUBLIC LIABILITY INSURANCE. Tenant shall during the term hereof
keep in full force and effect at its expense a policy or policies of public
liability insurance with respect to the Premises and the business of Tenant, on
terms and with companies approved in writing by Landlord, in which both Tenant
and Landlord shall be covered by being named as insured parties under reasonable
limits of liability not less than $1,000,000, or such greater coverage as
Landlord may reasonably require, combined single limit coverage for injury or
death. Such policy or policies shall provide that thirty (30) days written
notice must be given to Landlord prior to cancellation thereof. Tenant shall
furnish evidence satisfactory to Landlord at the time this Lease is executed
that such coverage is in full force and effect.
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ARTICLE 8. CONDEMNATION
8.1 SUBSTANTIAL TAKING. If all or a substantial part of the Premises
are taken for any public or quasi-pubic use under any governmental law,
ordinance or regulation, or by right of eminent domain or by purchase in lieu
thereof, and the taking would prevent or materially interfere with the use of
the Premises for the purpose for which it is then being used, this Lease shall
terminate and the rent shall be abated during the unexpired portion of this
Lease effective on the date physical possession is taken by the condemning
authority. Tenant shall have no claim to the condemnation award or proceeds in
lieu thereof, except that Tenant shall be entitled to a separate award for the
cost of removing and moving its personal property.
8.2 PARTIAL TAKING. If a portion of the Premises shall be taken for any
public or quasi-public use under any governmental law, ordinance or regulation,
or by right of eminent domain or by purchase in lieu thereof, and this Lease is
not terminated as provided in Section 8.1 above, the rent payable under this
Lease during the unexpired portion of the term shall be adjusted to such an
extent as may be fair and reasonable under the circumstances. Tenant shall have
no claim to the condemnation award or proceeds in lieu thereof, except that
Tenant shall be entitled to a separate award for the cost of removing and moving
its personal property.
ARTICLE 9. ASSIGNMENT OR SUBLEASE
9.1 LANDLORD ASSIGNMENT. Landlord shall have the right to sell,
transfer or assign, in whole or in part, its rights and obligations under this
Lease and in the Building. Any such sale, transfer or assignment shall operate
to release Landlord from any and all liabilities under this Lease arising after
the date of such sale, assignment or transfer.
9.2 TENANT ASSIGNMENT. Tenant shall not assign, in whole or in part,
this Lease, or allow it to be assigned, in whole or in part, by operation of law
or otherwise (including without limitation by transfer of a majority interest of
stock, merger, or dissolution, which transfer of majority interest of stock,
merger or dissolution shall be deemed an assignment) or mortgage or pledge the
same, or sublet the Premises, in whole or in part, without the prior written
consent of Landlord, and in no event shall say such assignment or sublease ever
release Tenant or any guarantor from any obligation or liability hereunder.
Notwithstanding anything in this Lease to the contrary, in the event of any
assignment or sublease, any option or right of first refusal granted to Tenant
shall not be assignable by Tenant to any assignee or sublessee. No assignee or
sublessee of the Premises or any portion thereof may assign or sublet the
Premises or any portion thereof.
9.3 CONDITIONS OF ASSIGNMENT. If Tenant desires to assign or sublet all
or any part of the Premises, it shall so notify Landlord at least thirty (30)
days in advance of the
13
date on which Tenant desires to make such assignment or sublease. Tenant shall
provide Landlord with a copy of the proposed assignment or sublease and such
information as Landlord might request concerning the proposed sublessee or
assignee to allow Landlord to make informed judgments as to the financial
condition, reputation, operations and general desirability of the proposed
sublessee or assignee. Within fifteen (15) days after Landlord's receipt of
Tenant's proposed assignment or sublease and all required information concerning
the proposed sublessee or assignee, Landlord shall have the following options:
(1) cancel this Lease as to the Premises or portion thereof proposed to be
assign or sublet; (2) consent to the proposed assignment or sublease, and, if
the rent due and payable by any assignee or sublessee under any such permitted
assignment or sublease (or a combination of the rent payable under such
assignment or sublease plus any bonus or any other consideration or any payment
incident thereto) exceeds the rent payable under this Lease for such space,
Tenant shall pay to Landlord all such excess rent and other excess consideration
within ten (10) days following receipt thereof by Tenant; or (3) refuse, in its
sole and absolute discretion and judgment, to consent to the proposed assignment
or sublease, which refusal shall be deemed to have been exercised unless
Landlord gives Tenant written notice providing otherwise. Upon the occurrence of
an event of default, if all or any part of the Premises are then assig nod or
sublet, Landlord, in addition to any other remedy's provided by this Lease or
provided by law, may, at its option, collect directly from the assignee or
sublessee all rents becoming due to Tenant by reason of the assignment or
sublease, and Landlord shall have a security interest in all properties on the
Premises to secure payment of such sums. Any collection directly by Landlord
from the assignee or sublessee shall not be construed to constitute a novation
or a release of Tenant or any guarantor from the further performance of its
obligations under this Lease.
9.4 RIGHTS OF MORTGAGE. Tenant accepts this Lease subject and
subordinate to any recorded mortgage presently existing or hereafter created
upon the Building and to all existing recorded restrictions, covenants,
easements and agreements with respect to the Building. Landlord is hereby
irrevocably vested with full power and authority to subordinate Tenant's
interest under this Lease to any first mortgage lien hereafter placed on the
Premises, and Tenant agrees upon demand to execute additional instruments
subordinating this Lease as Landlord may require. If the interests of Landlord
under this Lease shall be transferred by reason of foreclosure or other
proceedings for enforcement of any first mortgage or deed of trust on the
Premises, Tenant shall be bound to the transferee (sometimes called the
"Purchaser") at the option of the Purchaser, under the terms, covenants and
conditions of this Lease for the balance of the term remaining, including any
extensions or renewals, with the same force and effect as if the Purchaser were
Landlord under this Lease, and, if requested by the Purchaser, Tenant agrees to
attorn to the Purchaser, including the first mortgagee under any such mortgage
if it be the Purchaser, as its Landlord. Notwithstanding the foregoing, Tenant
shall not be disturbed in its possession of the Premises so long as Tenant is
not in default hereunder.
9.5 TENANT'S STATEMENTS. Tenant agrees to furnish, from time to time,
within ten (10) days after receipt of a request from Landlord or Landlord's
mortgagee, a statement certifying, if applicable, the following: Tenant is in
possession of the Premises; the Premises
14
are acceptable; the Lease is in full force and effect; the Lease is unmodified;
Tenant claims no present charge, lien, or claim of offset against rent; the rent
is paid for the current month, but is not prepaid for more than one month and
will not be prepaid for more than one month in advance; there is no existing
default by reason of some act or omission by Landlord; and such other matters as
may be reasonably required by Landlord or Landlord's mortgagee. Tenant's failure
to deliver such statement, in addition to being a default under this Lease,
shall be deemed to establish conclusively that this Lease is in full force and
effect except as declared by Landlord, that Landlord is not in default of any of
its obligations under this Lease, and that Landlord has not received more than
one month's rent in advance. Tenant agrees to furnish, from time to time, within
ten (10) days after receipt of a request from Landlord, a current financial
statement of Tenant, certified as true and correct by Tenant.
ARTICLE 10. LIENS
10.1 LANDLORD'S LIEN. AS security for payment of rent, damages and all
other payments required to be made by this Lease, Tenant hereby grants to
Landlord a lien upon all property of Tenant now or subsequently located upon the
Premises. Landlord may enter upon the Premises, by picking or changing locks if
necessary, and take possession of all or any part of the personal property, and
may sell all or any part of the personal property at a public or private sale,
in one or successive sales, with or without notice, to the highest bidder for
cash, and, on behalf of Tenant, sell and convey all or part of the personal
property to the highest bidder, delivering to the highest bidder all of Tenant's
title and interest in the personal property sold. The proceeds of the sale of
the personal property shall be applied by Landlord toward the reasonable costs
and expenses of the sale, including attorney's fees, and then toward the payment
of all sums then due by Tenant to Landlord under the terms of this Lease. Any
excess remaining shall be paid to Tenant or any other person entitled thereto by
law.
ARTICLE 11. DEFAULT AND REMEDIES
11.1 DEFAULT BY TENANT. The following shall be deemed to be events of
default ("Default") by Tenant under this Lease: (1) Tenant shall fail to pay
when due any installment of rent or any other payment required pursuant to this
Lease; (2) Tenant shall abandon any substantial portion of the Premises; (3)
Tenant shall fail to comply with any term, provision or covenant of this Lease,
other than the payment of rent, and the failure is not cured within ten (10)
days after written notice to Tenant; (4) Tenant shall file a petition or if an
involuntary petition is filed against Tenant, or becomes insolvent, under any
applicable federal or state bankruptcy or insolvency law or admit that it cannot
meet its financial obligations as they become due; or a receiver or trustee
shall be appointed for all or substantially all of the assets of Tenant; or
Tenant shall make a transfer in fraud of creditors or shall make an assignment
for the benefit of creditors; or (5) Tenant shall do or permit to be done any
act
15
which results in a lien being filed against the Premises or the Building and/or
project of which the Premises are a part.
In the event that an order for relief is entered in any case under
Title 11, U.S.C. (the "Bankruptcy Code") in which Tenant is the debtor and: (A)
Tenant as debtor-in-possession, or any trustee who may be appointed in the case
(the "Trustee") seeks to assume the Lease, then Tenant, or Trustee if
applicable, in addition to providing adequate assurance described in applicable
provisions of the Bankruptcy Code, shall provide adequate assurance to Landlord
of Tenant's future performance under the Lease by depositing with Landlord a sum
equal to the lesser of twenty-five percent (25%) of the rental and other charges
due for the balance of the Lease term of six (6) months' rent ("Security"), to
be held (without any allowance for interest thereon) to secure Tenant's
obligations under the Lease, and (B) Tenant, or Trustee if applicable, seeks to
assign the Lease after assumption of the same, then Tenant, in addition to
providing adequate assurance described in applicable provisions of the
Bankruptcy Code, shall provide adequate assurance to Landlord of the proposed
assignee's future performance under the Lease by depositing with Landlord a sum
equal to the Security to be held (without any allowance or interest thereon) to
secure performance under the Lease. Nothing contained herein expresses or
implies, or shall be construed to express or imply, that Landlord is consenting
to assumption and/or assignment of the Lease by Tenant, and Landlord expressly
reserves all of its rights to object to any assumption and/or assignment of the
Lease. Neither Tenant nor any Trustee shall conduct or permit the conduct of any
"fire", "bankruptcy", "going out of business" or auction sale in or from the
Premises.
11.2 REMEDIES FOR TENANT'S DEFAULT. Upon the occurrence of a Default as
defined above Landlord may elect either (i)to cancel and terminate this Lease
and this Lease shall not be treated as an asset of Tenant's bankruptcy estate,
or (ii) to terminate Tenant's right to possession only without canceling and
terminating Tenant's continued liability under this Lease. Notwithstanding the
fact that initially Landlord elects under (iii) to terminate Tenant's right to
possession only, Landlord shall have the continuing right to cancel and
terminate this Lease by giving three (3) days' written notice to Tenant of such
further election, and shall have the right to pursue any remedy at law or in
equity that may be available to Landlord.
In the event of election under (ii) to terminate Tenant's right to
possession only, Landlord may, at Landlord's option, enter into the Premises and
take and hold possession thereof, without such entry into possession terminating
this Lease or releasing Tenant in whole or in part from Tenant's obligation to
pay all amounts hereunder for the full stated term. Upon such reentry, Landlord
may remove all persons and property from the Premises and such property may be
removed and stored in a public warehouse or elsewhere at the cost of and for the
account of Tenant, without becoming liable for any loss or damage which may be
occasioned thereby. Such reentry shall be conducted in the following manner:
without resort to judicial process or notice of any kind if Tenant has abandoned
or voluntarily surrendered possession of the Premises; and, otherwise, by resort
to judicial process. Upon and after entry into possession without termination of
the Lease, Landlord may, but is not obligated to, relet the Premises, or any
part thereof, to any one other than the Tenant, for such time and upon
16
such terms as Landlord, in Landlord's sole discretion, shall determine. Landlord
may make alterations and repairs to the Premises to the extent deemed by
Landlord necessary or desirable.
Upon such reentry, Tenant shall be liable to Landlord as follows:
A. For all attorneys' fees incurred by Landlord in connection with
exercising any remedy hereunder;
B. For the unpaid installments of base rent, additional rent or other
unpaid sums which were due prior to such reentry, including interest
and late payment fees, which sums shall be payable immediately.
C. For the installments of base rent, additional rent, and other sums
falling due pursuant to the provisions of this Lease for the period
after reentry during which the Premises remain vacant, including
late payment charges and interest, which sums shall be payable as
they become due hereunder.
D. For all expenses incurred in releasing the Premises, including
leasing commissions, attorneys fees, and costs of alteration and
repairs, which shall be payable by Tenant as they are incurred by
Landlord; and
E. While the Premises are subject to any new lease or leases made
pursuant to this Section, for the amount by which the monthly
installments payable under such new lease or leases is less than the
monthly installment for all charges payable pursuant to this Lease,
which deficiencies shall be payable monthly.
Notwithstanding Landlord's election to terminate Tenant's right to
possession only, and notwithstanding any relefting without termination,
Landlord, at any time thereafter, may elect to terminate this Lease, and to
recover (in lieu of the amounts which would thereafter be payable pursuant to
the foregoing, but not in diminution of the amounts payable as provided above
before termination), as damages for loss of bargain and not as a penalty, an
aggregate sum equal to the amount by which the rental value of the portion of
the term unexpired at the time of such election is less than an amount equal to
the unpaid base rent, percentage rent, and additional rent and all other charges
which would have been payable by Tenant for the unexpired portion of the term of
this Lease, which deficiency and all expenses incident thereto, including
commissions, attorneys' fees, expenses of alterations and repairs, shall be due
to Landlord as of the time Landlord exercises said election, notwithstanding
that the term had not expired. If Landlord, after such reentry, leases the
Premises, then the rent payable under such new lease shall be conclusive
evidence of the rental value of the unexpired portion of the term of this Lease.
17
If this Lease shall be terminated by reason of the bankruptcy or
insolvency of Tenant, Landlord shall be entitled to recover from Tenant or
Tenant's estate, as liquidated damages for loss of bargain and not as a penalty,
the amount determined by the immediately preceding paragraph.
11.3 LANDLORD'S RIGHT TO PERFORM FOR ACCOUNT OF TENANT. If Tenant shall
be in Default under this Lease, Landlord may cure the Default at any time for
the account and at the expense of Tenant. If Landlord cures a Default on the
part of Tenant, Tenant shall reimburse Landlord upon demand for any amount
expended by Landlord in connection with the cure, including, without limitation,
attorney's fees and interest.
11.4 INTEREST AND ATTORNEY'S FEES. In the event of a Default by Tenant:
(1) if a monetary default, interest shall accrue on any sum due and unpaid at
the rate of the lesser of eighteen percent (18%) per annum or the highest rate
permitted by law and, if Landlord places in the hands of an attorney the
enforcement of all or any part of this Lease, the collection of any rent due or
to become due or recovery of the possession of the Premises, Tenant agrees to
pay Landlord's costs of collection, including reasonable attorney's fees for the
services of the attorney, whether suit is actually filed or not.
11.5 ADDITIONAL REMEDIES, WAIVERS, ETC.
A. The rights and remedies of Landlord set forth herein shall be in
addition to any other right and remedy now and hereafter provided by
law. All rights and remedies shall be cumulative and not exclusive
of each other. Landlord may exercise its rights and remedies at any
times, in any order, to any extent, and as often as Landlord deems
advisable without regard to whether the exercise of one right or
remedy precedes, concurs with or succeeds the exercise of another.
B. A single or partial exercise of a right or remedy shall not preclude
a further exercise thereof, or the exercise of another right or
remedy from time to time.
C. No delay or omission by Landlord in exercising a right or remedy
shall exhaust or impair the same or constitute a waiver of, or
acquiesce to, a Default.
D. No waiver of a Default shall extend to or affect any other Default
or impair any right or remedy with respect thereto.
E. No action or inaction by Landlord shall constitute a waiver of a
Default.
F. No waiver of a Default shall be effective unless it is in writing
and signed by Landlord.
18
ARTICLE 12. RELOCATION - DELETED
ARTICLE 13. AMENDMENT AND LIMITATION OF WARRANTIES
13.1 ENTIRE AGREEMENT. IT IS EXPRESSLY AGREED BY TENANT, AS A MATERIAL
CONSIDERATION FOR THE Execution OF THIS LEASE, THAT THIS LEASE, WITH THE
SPECIFIC REFERENCES TO WRITTEN Extrinsic DOCUMENTS, IS THE ENTIRE AGREEMENT OF
THE PARTIES: THAT THERE ARE, AND WERE, NO VERBAL REPRESENTATIONS, WARRANTIES,
UNDERSTANDINGS, STIPULATIONS, AGREEMENTS OR PROMISES PERTAIN1NG TO THIS LEASE OR
TO THE EXPRESSLY MENTIONED WRITTEN Extrinsic DOCUMENTS NOT INCORPORATED IN
WRITING IN THIS LEASE.
13.2 AMENDMENT. THIS LEASE MAY NOT BE ALTERED, WANED, AMENDED OR
EXTENDED EXCEPT BY AN INSTRUMENT IN WRITING SIGNED BY LANDLORD AND TENANT.
13.3 LIMITATION OF WARRANTIES. LANDLORD AND TENANT EXPRESSLY AGREE THAT
THERE ARE AND SHALL BE NO IMPLIED WARRANTIES OR MERCHANTABILITY, HABITABILITY,
FITNESS FOR A PARTICULAR PURPOSE OR OF ANY OTHER KIND ARISING OUT OF THIS LEASE,
AND THERE ARE NO WARRANTIES WH1CH EXTEND BEYOND THOSE EXPRESSLY SET FORTH IN
THIS LEASE.
ARTICLE 14. MISCELLANEOUS
14.1 ACT OF GOD. Landlord shall not be required to perform any covenant
or obligation in this Lease, or be liable in damages to Tenant, so long as the
performance or
19
non-performance of the covenant or obligation is delayed. caused or prevented by
an act of God, force majeure or by Tenant.
14.2 SUCCESSORS AND ASSIGNS. This Lease shall be binding upon and inure
to the benefit of Landlord and Tenant and their respective heirs, personal
representatives, successors and assigns. It is hereby covenanted and agreed that
should Landlord's interest in the Premises cease to exist for any reason during
the term of this Lease, then notwithstanding the happening of such event this
Lease nevertheless shall remain unimpaired and in full force and effect, and
Tenant hereunder agrees to attorn to the then owner of the Premises.
14.3 RENT TAX. If applicable in the jurisdiction where the Premises are
issued, Tenant shall pay and be liable for all rental, sales and use taxes or
other similar taxes. If any, levied or imposed by any city, state, county or
other governmental body having authority, such payments to be in addition to all
other payments required to be paid to Landlord under the terms of this Lease.
Any such payment shall be paid concurrently with the payment of the rent,
additional rent, operating expenses or other charge upon which the tax is based
as set forth above.
14.4 CAPTIONS. The captions appearing in this Lease are inserted only
as a matter of convenience and in no way define, limit, construe or describe the
scope or intent of any Section.
14.5 NOTICE. All rent and other payments required to be made by Tenant
shall be payable to Landlord at the address set forth in Section 1.5. All
payments required to be made by Landlord to Tenant shall be payable to Tenant at
the address set forth in Section 1.5, or at any other address within the United
States as Tenant may specify from time to time by written notice. Any notice or
document required or permitted to be delivered by the terms of this Lease shall
be deemed to be delivered (whether or not actually received) when deposited in
the United States Mail, postage prepaid, certified mail, return receipt
requested, addressed to the parties at the respective addresses set forth in
Section 1.5.
14.6 SUBMISSION OF LEASE. Submission of this Lease to Tenant for
signature does not constitute a reservation of space or an option to lease. This
Lease is not effective until execution by and delivery to both Landlord and
Tenant.
14.7 CORPORATE AUTHORITY. If Tenant executes this Lease as a
corporation, each of the persons executing this Lease on behalf of Tenant does
hereby personally represent and warrant that Tenant is a duly authorized and
existing corporation, that Tenant is qualified to do business in the state in
which the Premises are located, that the corporation has full right and
authority to enter into this Lease, and that each person signing on behalf of
the corporation Is authorized to do so. In the event any representation or
warranty is false, all persons who execute this Lease shall be liable,
individually, as Tenant.
20
14.8 HAZARDOUS SUBSTANCES. Tenant shall not bring or permit to remain
on the Premises or the Building any asbestos, petroleum or petroleum products,
explosives, toxic materials, or substances defined as hazardous wastes,
hazardous materials, or hazardous substances under any federal, state, or local
law or regulation ("Hazardous Materials"). Tenant's violation of the foregoing
prohibition shall constitute a material breach and default hereunder and Tenant
shall indemnify, hold harmless and defend Landlord from and against any claims,
damages, penalties, liabilities, and costs (including reasonable attorney fees
and court costs) caused by or arising out of (i) a violation of the foregoing
prohibition or (ii) the presence or any release of any Hazardous Materials on,
under, or about the Premises or the Building during the term of the Lease.
Tenant shall clean up, remove, remediate and repair any soil or ground water
contamination and damage caused by the presence and any release of any Hazardous
Materials in, on, under, or about the Premises or the Building during the term
of the Lease in conformance with the requirements of applicable law. Tenant
shall immediately give Landlord written notice of any suspected breach of this
paragraph; upon learning of the presence of any release of any Hazardous
Materials, and upon receiving any notices from governmental agencies pertaining
to Hazardous Materials which may affect the Premises or the Building. The
obligations of Tenant hereunder shall survive the expiration or earlier
termination, for any reason, of this Lease. To the best of Landlord's knowledge,
the Premises does not contain any hazardous substances as of the Lease
Commencement Date.
14.9 SEVERABILITY. If any provision of this Lease or the application
thereof to any person or circumstances shall be invalid or unenforceable to any
extent, the remainder of this Lease and the application of such provisions to
other persons or circumstances shall not be affected thereby and shall be
enforced to the greatest extent permitted by law.
14.10 LANDLORD'S LIABILITY. If Landlord shall be in default under this
Lease and, if as a consequence of such default, Tenant shall recover a money
judgment against Landlord, such judgment shall be satisfied only out of the
right, title and interest of Landlord in the Building as the same may then be
encumbered and neither Landlord nor any person or entity comprising Landlord
shall be liable for any deficiency. In no event shall Tenant have the right to
levy execution against any property of Landlord nor any person or entity
comprising Landlord other than its interest in the Building as herein expressly
provided.
14.11 BROKERAGE. Landlord and Tenant each represents and warrants to
the other that there is no obligation to pay any brokerage fee, commission,
finder's fee or other similar charge in connection with this Lease, other than
fees due to Xxxxxxx Properties which are the responsibility of Xxxx Properties,
lnc. Each party covenants that it will defend, indemnify and hold harmless the
other party from and against any loss or liability by reason of brokerage or
similar services alleged to have been rendered to, at the instance of, or agreed
upon by said indemnifying party. Notwithstanding anything herein to the
contrary, Landlord and Tenant agree that there shall be no brokerage fee or
commission due on expansions; options or renewals by Tenant.
21
Tenant agree that there shall be no brokerage fee or commission due on
expansions, options or renewals by Tenant.
14.12 NOTIFICATION TO TENANT. Landlord hereby notifies Tenant that the
person auThorized to execute this Lease and manage the Premises is Xxxx
Properties, Inc., which has been appointed to act as the agent in leasing
management and operation of the Building for owner and is authorized to accept
service of process and receive or give receipts for notices and demands on
behalf of Landlord. Landlord reserves the right to change the identity and
status of its duly authorized agent upon written notice to Tenant.
14.13 PLYMOUTH TECHNOLOGY PARK LEASE TERMINATION. Upon complete
execution of this Lease, Leases dated April 12, 2001 for 5,033 square feet of
space at Plymouth Technology Park I and Leases date October 5th, 1998 for 26,186
square feet of space at Plymouth Technology Park II shall become null and void.
14.14 EXHIBITS. Reference is made to the following Exhibits which are
attached hereto and made a part hereof:
Exhibit A Plan of Demised Premises
Exhibit B Legal Description
Exhibit C DELETED
Exhibit D Tenant Improvements
Exhibit D1 ProForm Bid
Exhibit E Sign Restrictions
Exhibit F Rules and Regulations
Exhibit G Contingency
ARTICLE 15. SIGNATURES
SIGNED effective the day and year first above written:
LANDLORD TENANT
321 CORPORATION INSIGNIA SYSTEMS INC.
By: /s/ Xxxxxx X. Xxxx By: /s/ Xxxx Xxxxxxxx
----------------------------- ------------------------------------
Xxxxxx X. Xxxx CEO Xxxx Xxxxxxxx VP Finance
----------------------------- ------------------------------------
(Type Name and Title) (Type Name and Title)
EXHIBIT "A"
PLAN OF DEMISED PREMISES
[GRAPHIC OMITTED]
EXHIBIT "B"
LEGAL DESCRIPTION
-----------------
XXX 0, XXXXX 0, XXXXXXXXX XXXXX XXXX, XXXXXXXXX TO THE RECORDED PLAT THEREOF,
HENNEPIN COUNTY, MINNESOTA.
2
EXHIBIT "D"
LANDLORD SHALL AT LANDLORD'S SOLE COST PROVIDE $705,800.40 IN TENANT
IMPROVEMENTS AS OUTLINED ON THE ATTACHED EXHIBIT D1. ANY ADDITIONAL TENANT
IMPROVEMENTS OVER THE $705,800.40 ALLOWANCE WILL BE THE TENANT'S RESPONSIBILITY.
EXHIBIT "D1"
October 22, 2002
Quotation #23207
XXX XXXXXXXX
0000 Xxx Xxxxxx Xxxxx
Xxxxxxxxx, XX 00000
RE: Insignia Systems, Inc.
Dear Xx. Xxxxxxxx,
We are pleased to present this quotation to furnish labor, materials, equipment
and supervision as required to perform work as listed below. This budget is
based on drawings, notes & specs dated 7/12/02 and also a walk with the
Owner's/Insignia's representative on Wednesday, July 17, 2002.
FRAMING AND DRYWALL
o Frame, hang, tape and finish per plan.
o Warehouse walls to be 3 5/8" 20-gauge studs.
o Set metal doorifames.
o Exclusions: Work on existing walls.
PLUMBING
o Sawcut, remove & patch concrete floor (based on 100' of trench).
o Demo & patch floor to cap 8 floor drains.
o Hook-up 2 each air compressors & install 3/4" air piping.
o Hang 2 each vacuum exhaust machines & approximately 200' of tubing.
o Hook-up Owners DI system & install new schedule 80 PVC piping.
o Furnish and install 2 each Toto handicapped tank type toilets.
o Furnish and install 3 each Toto regular toilets.
o Furnish and install 1 each American Standard urinal with Xxxxx flush
valve.
o Furnish and install 4 each wall-hung lays with ADA Delta faucets.
o Furnish and install toilet partitions & accessories, grab bars,
mirrors, toilet paper holders, paper towel holders, etc.
o Furnish and install PVC waste & vent piping.
o Furnish and install Type L copper water piping & fittings with
fiberglass pipe insulation.
o Furnish and install 6 each 2" floor drains & waste piping.
o Permits, testing & inspections.
ELECTRICAL
o Demo as required for front offices and new east offices.
o Demo ceiling in Press area (store existing lights at jobsite).
o Re-work lighting as needed.
o Furnish and install 1 each reception desk receptacle.
o Furnish and install 7 each total receptacles for breakroom, 6 each
dedicated receptacles for equipment per plan. Wire 1 each 50-amp
oven.
o Wire 1 each phone panel per spec. Including 4 each isolated 4-plex
receptacles.
o Furnish and install 46 new switches for new offices.
o Relocate and re-wire up to 120 existing 2 x 4 fixtures.
o Furnish and install up to 9 each new exist lights (to be approved by
Fire Xxxxxxxx).
o Allowance for up to 18 new recessed -- fluorescent can lights.
o Allowance for 80 duplex -- general purpose receptacles.
o 5 each column feeds for furniture connections.
o 5 each power pole feed points for furniture connections.
o Circuits to include 1 each circuit per 2 cubicles.
o Additional panel for cube circuits.
o Wire 2 small PRV units.
o 50 data stub conduits.
o Print Press area to include: disconnect existing machines at existing
building, reuse transformers at new location, 2 each new panels per
existing space, 4 each cord drop receptacles, wire 2 each xxxx Andy
machines with exhaust machines, and 54 each 8' strip fixtures with
industrial cover to reflect downward (432').
o Wire the following machines in the print pres area: 1 each xxxxxx and
fan, 1 each humidifier, 2 each air compressors, 1 each dryer, 2 each
shrink-wrap machines, 1 each press dryer, 1 each cortel, 1 each
receptacle for mechanical hoist, and an allowance to wire new 25-HIP
compressor.
o Re-work up to 60 lights to accommodate for new room lay-out, re-use
existing transformer, wire existing Heidelburg machine, water
softener receptacle, panel for up to 15 copiers in adjacent room, up
to 20 general purpose receptacles, and wire other machine in the same
area.
o Permit fees.
FLOORING
o Furnish and install carpet and standard VCT.
o Furnish, install and bind 4" carpet base.
o Patch plumbing drain.
o Remove VCT/Wax/Grind.
o Patch/ramp VCT down.
o Transitions.
o Furnish and install ceramic at bathroom.
MECHANICAL
o Revamp existing ductwork, ceiling diffusers and add necessary
ductwork and ceiling diffusers for new wall lay out and new ceiling
height.
o Necessary vents through roof from existing machinery.
o Disconnect round ductwork from 2 existing presses and reconnect in
the print room.
o Exhaust for existing compactor and the new pressroom.
o Graphic room to have separate rooftop unit and control.
o Boardroom, President's office and Vice President's office to have
thermostat for rooftop units.
o Permits.
FINISHES
o Painting of all walls to 10'.
o Finish new doors and frames to match existing doors, frames and
windows.
o Buy and hang wall covering in boardroom with an allowance of $10.00
per yard - for material.
o No work to be done on existing doors, frames, and windows.
FIRE PROTECTION
o Add/relocate sprinklers as required for the new office build out.
Sprinklers will be aligned but not necessarily centered in the tile--
chrome semi-recessed type.
o Provide sprinklers along new demising walls as required by NFPA #13.
o Wet pipe system modifications only. No special system (i.e.
pre-action, FM 200, etc.) modifications included.
o No raising or relocation of existing main or branchline piping is
included in this proposal other than raising the existing drops in
the 9' ceiling area being converted to 10' ceiling.
o Pipe shall be black schedule 7, 10 or threadable lightwall with black
screwed or mechanical fittings.
o Permits and engineering included.
o Excludes: paint, electrical, bonds, fire extinguishers, hose
station/racks, and monitoring.
Subtotal: $690,800.40
ADD for Owner IT allowance: $ 15,000.00
-----------
TOTAL: $705,800.40
Thank you for the opportunity to present this budget quotation. If you have any
further questions, feel free to call.
Sincerely,
Xxxx Xxxxxxxxx
President of Operations
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Xxxx Xxxxxxxxx -- President Date
Proform Construction, Inc.
------------------------------- ----------------------------
Xxxx Properties Representative Date
LEASE EXHIBIT E
TENANT SIGN CRITERIA
(NORTHGATE I/INSIGNIA SYSTEMS INC.)
NORTHGATE ONE
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1. FRONT OF BUTLDING - EXTERIOR SIGN
A) Main Tenant Identification Signs -- Exterior
1) All front exterior signs to be limited to area
above the glass line. With individual entrances,
sign letters shall be centered vertically and
horizontally over tenant entry doorway/sidelight,
or centered above the tenant's space if the door
if off center. Where tenants share an entrance the
letters are to be installed on the appropriate
side of entrance.
2) Building standard sign letters are 2" deep reverse
channel aluminum letters. Face and channels to
have paint finish and are to be Burgundy.
3) Letter height may not exceed 18" tall. Overall
height for two lines of text may not exceed 30".
All sign leter layouts must be approved by the
Landlord. The total width of the letter area may
not exceed 50% of the front facade of that portion
of the building occupied by the tenant.
4) The building standard letter style is Helvetica
Medium. Tenant may select from other type styles
only with approval of the Landlord. Individual
letters may be upper or lower case. Logos are
acceptable in the same letter color and finish.
5) Method of attaching sign letters to building to be
standard non-corrosive studs spaced to correspond
with horizontal grout lines space 4" on center.
Silicone adhesive to be used to secure studs and
fill holes.
B) Front doors -- Exterior/Interior
1) Exterior Front Doors
a) Suite numbers are required on the main
glass entrance door. Text to be 4" tall
premium adhesive vinyl film, white
Helvetica medium style, applied first
surface.
b) For individual entranced, numbers shall
be centered on the door glass. For shared
entrance doors, numbers shall be centered
on the appropriate half and 4" below the
top of the glass.
c) Suite numbers are assigned by the Owner.
film, white, Helvetica Medium style, applied first surface.
The first tenant shall place its name and numbers at top of
door. A maximum of two tenants per door.
B) Interior vestibule service door, if applicable: Graphics
identical with front interior door.
3. PROHIBITED SIGNS
A) Signs on glass visible from exterior except as identified
in this criteria.
B) Rooftop signs.
C) Freestanding signs other than the project identification
sign and appropriately authorized real estate sign(s).
D) The use of electrical components that flash, illuminate,
revolve, rotate, or make noise.
E) Auxiliary signage, including banners.
F) Parking space signs without approval of the owner 3 sq. ft.
maximum.
G) Signs on vehicles when parked other than in a parking
stall.
4. APPROVAL PROCESS
A) Three copies of a sign layout drawing must be submitted by
the tenant to the building owner. Approval must be granted
in writing by the building owner prior to sign
installation.
B) Tenant is responsible for all sign permits required by the
City.
5. MISCELLANEOUS
A) Tenant is responsible for cost of sign removal upon
vacating space.
EXHIBIT "F"
BUILDING RULES AND REGULATIONS
------------------------------
1. Any sign, lettering, picture, notice or advertisement installed on or in
any part of the Premises and visible from the exterior or interior common
area of the Complex, or visible from the exterior of the Premises, shall be
installed at Lessee's sole cost and expense, and in such manner, character
and style as Lessor may approve in writing. Anything herein to the contrary
not withstanding, approval as to signs shall be subject to Lessor's
approval which may be withheld in Lessor's sole discretion. In the event of
a violation of the foregoing by Lessee, Lessor may remove the same without
any liability and may charge the expense incurred by such removal to
Lessee.
2. No awning or other projection shall be attached to the outside walls of the
Complex. No curtains, blinds, shades or screens visible from the exterior
Premises, shall be attached to or hung in, or used in connection with any
such curtains, blinds, shades, screens or other fixtures must be of a
quality, type, design and color, and attached in the manner approved by
Lessor.
3. Lessee, its employees, customers, invitees and guests shall not obstruct
sidewalks, entrances, passages, corridors, vestibules, halls or stairways
in and about the Complex which are used in common with other tenants and
their employees, customers, guests and invitees, and which are not a part
of the Premises of Lessee. Lessee shall not place objects against glass
partitions or doors or windows which would be unsightly from the Complex
corridors or from the exterior of the Complex and will promptly remove any
such objects upon notice from Lessor.
4. Lessee shall not make excessive noises, cause disturbances or vibrations or
use or operate any electrical or mechanical devices that emit excessive
sound or other waves or disturbances or create obnoxious odors, any of
which may be offensive to the other tenants and operation of any device
equipment, radio, television broadcasting or reception from or within the
Complex aerials or similar devices inside or outside of the Premises or on
the Complex.
5. Lessee shall not waste electricity, water or air conditioning furnished by
Lessor, if any, and shall cooperate fully with Lessor to ensure the most
effective operation of the Complex's heating and air conditioning systems.
6. Lessee assumes full responsibility for protecting its space from theft,
robbery, and pilferage, which includes keeping doors locked and other means
of entry to the Premises closed and secured after normal business hours.
7. In no event shall Lessee bring into the Complex flammables, such as
gasoline, kerosene, naphtha and benzine, or explosives or any other article
of intrinsically dangerous nature. If, by reason of the failure of Lessee
to comply with the provisions of this subparagraph, any insurance premium
for all or any part of the Complex shall at any time be increased, Lessee
shall make immediate payment of the whole of the increased insurance
premium, without waiver of any of Lessor's other rights at law or in equity
for Lessee's breach of this Lease.
8. Lessee shall comply with all applicable federal, state and municipal laws,
ordinances and regulations, and building rules and shall not directly of
indirectly make any use of the Premises which may be prohibited by any of
the foregoing or which may be dangerous to persons or property or may
increase the cost of insurance or require additional insurance coverage.
9. Lessor shall have the right to prohibit any advertising by Lessee which in
Lessor's reasonable opinion tends to impair the reputation of the Complex
or its desirability as a building complex for office/warehouse use, and
upon written notice from Lessor, Lessee shall refrain from or discontinue
such advertising.
10. The Premises shall not be used for cooking (as opposed to heating of food),
lodging, sleeping or for any immoral or illegal purpose.
11. Lessee and Lessee's employees, agents, visitors and licensees shall observe
faithfully and comply strictly with the foregoing Rules and Regulations and
such other and further appropriate rules and regulations as Lessor or
Lessor's agent may from time to time adopt. Reasonable notice of any
additional rules and regulations shall be given in such manner as Lessor
may reasonable elect.
12. Unless expressly permitted by the Lessor, no additional locks or similar
devices shall be attached to any door or window and no keys other than
those provided by the lessor shall be made for any door. If more than two
keys for one lock are desired by the Lessee, the Lessor may provide the
same upon payment by the Lessee. Upon termination of this Lease or of the
Lessee's possession, the Lessee shall surrender all keys of the Premises
and shall explain to the Lessor all combination locks on safes, cabinets
and vaults.
13. Any carpeting cemented down shall be installed with a releasable adhesive.
In the event of a violation of the foregoing by Lessee, Lessor may charge
the expense incurred by such removal to Lessee.
14. The restrooms, drinking fountains and other plumbing fixtures shall not be
used for any purpose other than those for which they are constructed, and
no sweepings, rubbish, rags, coffee grounds or other substances shall be
thrown therein. All damages resulting from any misuse of the fixtures shall
be borne by the Lessee who, or whose employees, agents, visitors or
licensees have caused the same. No person shall waste water by interfering
or tampering with the faucets or otherwise.
15. No electric or other wires for any purpose shall be brought into leased
Premises without Lessor's written permission specifying the manner in which
same may be done. Lessee shall not overload any utilities serving the
Premises.
16. No dog or other animal shall be allowed in the Complex.
17. All loading, unloading, receiving or delivery of goods, supplies or
disposal of garbage or refuse shall be made only though entryways provided
for such purposes. Lessee shall be responsible for any damage to the
Complex or the property of its employees or others and injuries sustained
by any person whomsoever resulting from the use or moving of such articles
in or out of the Premises, and shall make all repairs and improvements
required by Lessor or governmental authorities in connection with the use
or moving of such articles.
18. All safes, equipment or other heavy article shall be carried in or out of
the Premises only in such manner as shall be prescribed in writing by
Lessor, and Lessor shall in all cases have the right to specify the proper
position of any such safe, equipment or other heavy article, which shall
only be used by Lessee in a manner which will not interfere with or cause
damage to the Premises or Complex in which they are located, or to the
other tenants or occupants of said Complex. Lessee shall be responsible for
any damage to the building or the property of its employees or others and
injuries sustained by any person whomsoever resulting from the use or
moving of such articles in or out of the Premises, and shall make all
repairs and improvements required by Lessor or governmental authorities in
connection with the use or moving of such articles.
19. Canvassing, soliciting and peddling in or about the Complex is prohibited
and each Lessee shall cooperate to prevent the same .
20. Wherever in these Building Rules and Regulations the word "Lessee" occurs,
it is understood and agreed that it shall mean Lessee's associates,
employees, agents, clerks, invitees and visitors. Wherever the word
"Lessor" occurs, it is understood and agreed that it shall mean Lessor's
assignees, agents, clerks and visitors.
21. Lessor shall have the right to enter the Premises at hours convenient to
the Lessee for the purpose of exhibiting the same to prospective tenants
within the one hundred twenty (120) day period prior to the expiration of
this Lease, and may place signs advertising the leased Premises for rent on
the exterior of said Premises at any time within said period.
22. Lessee, its employees, customers, invitees and guests shall, when using the
parking facilities in and around the Complex, observe and obey all signs
regarding fire lanes and no parking zones, and when parking always park
between the designated lines. Lessor reserves the right to tow away, at the
expense of the owner, any vehicle which is improperly parked or parked in a
no parking zone. All vehicles shall be
parked at the sole risk of the owner, and Lessor assumes no responsibility
for any damage to or loss of vehicles. No vehicles shall be parked
overnight.
23. In case of invasion, mob, riot, public excitement, or other commotion,
Lessor reserves the right to prevent access to the Complex during the
continuance of the same by closing the doors or otherwise, for the safety
of the tenant or the protection of the Complex and the property therein.
Lessor shall in no case be liable for damages for any error or other action
taken with regard to the admission to or exclusion for the Complex of any
person.
24. All entrance doors to the Premises shall be locked when the Premises are
not in use. All common corridor doors, if any, shall also be closed during
times when the air conditioning equipment in the Complex is operating so as
not to dissipate the effectiveness of the system or place an overload
thereon.
25. Lessee shall be responsible for all repair, maintenance and replacement of
mechanical systems and devices directly associated with Lessee's Demised
Premises, including, but no limited to, heating and air conditioning
equipment, water heaters, exhaust fans, plumbing and electrical. Lessor
must be advised of any such repair, etc. and must approve of any such
repairs.
26. Alterations to the Demised Premises by the Lessee of any nature shall
require the written approval of the Lessor. Such approval shall be at the
sole discretion of the Lessor. In the event of a violation of the foregoing
by Lessee, Lessor may remove the same without any liability and may charge
the expense incurred by such removal to Lessee.
27. Lessor reserves the right at any time and from time to time to rescind,
alter or waive, in whole or in part, any of these Rules and Regulations
when it is deemed necessary, desirable, or proper, in Lessor's judgment,
for its best interest or for the best interest of the tenants of the
Complex.
EXHIBIT "G"
CONTINGENCY
This lease is contingent upon the successful purchase/closing of Northgate 1,
0000 Xxxxxxxx Xxxxx by 321 Corporation from First Industrial Realty Trust by
January 15, 2003.
