EXHIBIT 10.15
TENANCY AGREEMENT
The following tenancy agreement is reached
between DIBAG
Industriebau Aktiengesellschaft
Xxxxxxxxxxx 00
00000 Xxxxxx
-in the following LESSOR-
and Viking Direkt GmbH
IndustrieHandelsParkNord
Babenhaeuser Xxxxxxx 00
00000 Xxxxxxxxxxxx
-in the following LESSEE-
(S) 1 RENTAL OBJECT
---------------------
1.1 The warehouse, including office and social rooms with a surface area of
approx. 13,200 m/2/ hall surface area
approx. 450 m/2/ office and social rooms
approx. 5,100 m/2/ sealed transport-area,
which is to be built in Ludwigstrasse in 85399 Hallbergmoos, shall be
leased. The property has a total size of 24,000 m/2/.
1.2 The Lessor shall carry out a measurement of the leased surface area at
the time of delivery, in which interior walls and supports shall be
overmeasured. Thus, the surface area rented will be calculated from
inner side to inner side of the external walls.
Included in the rental surface area are transport and function areas
within the building and any ramp areas.
The Lessor shall send the Lessee the measurement by registered
letter/return receipt. If the Lessee does not object to this
measurement in writing within 21 days of its receipt, the measurement
shall be considered as bindingly approved and shall become an element
of the Agreement.
1.3 The rental property is marked in green in the enclosed plan of the
building site (Enclosure 1).
(S) 5 PURPOSE AND USE
-------------------------
The Lessee shall use the hall area for the storage and commissioning
of office materials and the office and social rooms as their names
suggest.
(S) 3 CONDITION OF THE RENTAL OBJECT/DELIVERY
-------------------------------------------------
3.1 The Lessor shall construct the Rental Object in accordance with the
enclosed building-site plan M 1 : 1,000 Pl.- No. BK-L 00 (Enclosure 1)
and the enclosed building specifications (Enclosure 2). The Lessor
shall compose the application plan in agreement with the Lessee
immediately upon the signing of the Agreement. If structural
alterations or requirements should be demanded when the building
permit is granted. These are to be carried out in agreement with the
Lessee. The Lessee shall agree to these structural changes inasmuch as
these do not pose an important interference to his business operation.
3.2 Upon delivery, a mutual Protocoll will be written up, in which any
defects will be included. Defects shall be defined as services of the
Lessor which are guaranteed in the building specifications but which
are missing or imperfectly executed. These defects are to be
eliminated by the Lessor within an appropriate period of time.
3.3 Defects, which do not represent an important limitation to the
intended use of the Rental Object by the Lessee, shall not hinder the
delivery. Construction work remaining to be finished must be accepted
by the Lessee. Claims by the Lessee for defects which are not included
in the Protocoll shall not be valid unless they are hidden defects.
(S) 4 COMMENCEMENT OF THE RENTAL PERIOD
-------------------------------------------
4.1 The binding date for the beginning of the Rental Period for the hall
area, which is yet to be determined, of 11,000 m/2/, and for the
office and social rooms shall be October 1, 1996.
4.2 The remaining hall area of approx. 2,200 m/2/ shall be taken over by
the Lessee within a period of 2 years; thus on September 30, 1998 at
the latest. The Lessee will inform the Lessor of the takeover date 3
full months in advance. The takeover shall take effect on the 1st of
the month.
4.3 The Lessor shall be authorized to rent the hall area of approx. 2,200
m/2/ to third parties until such time as the takeover is effected by
the Lessee. In doing so, he shall take into account the fair interests
of the Lessee. The third party shall be allowed the free rental of the
entrance driveway and service areas to an appropriate degree.
4.4 The Lessee can begin constructing fittings before taking over the
approx. 11,000 m/2/ hall area, inasmuch as these do not cause a delay
or hindrance to the completion of the Rental Object. The same is true
for the attachment of the advertising fittings.
4.5 Should the Lessee make use of the rental areas before their delivery,
the Lessor shall be authorized to invoice the rental fee and the
advance payment of the agreed operating costs as of this date. In the
case of partial use the rent due shall also be partial to the same
extent.
(S) 5 TERM AND TERMINATION OF THE TENANCY
---------------------------------------------
5.1 The Tenancy Agreement shall be valid for a period of 11 years. It
shall extend by terms of 5 years at the end of each term unless
terminated with 12 months notice by one of the parties to the
Agreement. The notice of termination shall be delivered by registered
letter/return receipt.
5.2 The Lessor can terminate the Tenancy Agreement without notice if an
important reason exists, especially
(a) if the Lessee is in arrears of more than two monthly rental
installments and more than two advanced payments for operating
costs,
(b) if court composition or bankruptcy proceedings are opened on the
assets of the Lessee or denied due to lack of insolvent assets,
or,
(c) if the Lessee fails to properly deliver the security deposit to
the Lessee in accordance with (S) 17 before the beginning of the
contractual term, despite being requested to do so in writing.
In the case of such a termination, the Lessee shall be liable for the
cost of the rental, incidental and other costs agreed to in this
Agreement up to the last agreed upon end of the Agreement. Other
claims for damages by the Lessor shall remain unaffected.
(S) 6 RENT
--------------
6.1 The monthly rental installment shall be
DM 13.--/m/2/ for hall area
DM 19.50/m/2/ for office and social rooms
DM 1.--/m/2/ for sealed ground surfaces.
6.2 The rent shall be paid plus the statutory V.A.T. and shall be subject
to the stable-value clause agreed to in (S) 7.
The Lessee expressly ensures that he is a manufacturer as understood
in accordance with the UStG (turnover tax law) and that he will not
use the Rental Object for residential or other non-business oriented
ends. The Lessee also expressly ensures, not to carry out any dealings
which, due to their manner and scope, would not allow the Lessor to
waive the exemption of the turnover tax.
Upon the demand of the Lessor, the Lessee shall be obliged to produce
evidence that the exclusive use of the Rental Object is for dealings
which do not exclude deduction of input tax.
6.3 The rent is to be paid in advance every month before the 3rd working
day of each month at no cost to the Lessor into an account which is to
be named by the Lessor. The Lessee agrees to allow the Lessor to
direct debit the monthly rental and incidental payments from his
account. The Lessee shall be obliged to sign the initial direct debit
authorization which accompanies the initial invoice and to sent it
back to the Lessor.
6.4 In the case of delays in payment, the Lessor shall be authorized to
charge a lump sum of DM 5.-- for each written reminder. Should the
payment of the rent be overdue by more than 10 days, the Lessor shall
be authorized to charge an interest on arrears of 5% above the valid
Discount Rate of the German Bundesbank at the time and not less than
10%.
(S) 7 FLOATING RENT CLAUSE
----------------------------
7.1 Should the cost of living index, as calculated by the Federal Bureau of
Statistics (Statistisches Bundesamt) in Wiesbaden, for a 4 person
household of employees with an average income, basis 1991 = 100, change,
either upwards or downwards with regard to the index level at the time
of commencement of the Agreement, the Rent shall change accordingly
subject to the proviso that the initial change take effect 24 months
after the commencement of the obligation to pay rent. The adaptation of
the rent shall then take place after further periods of 24 months and by
a sum equalling the change calculated by the above-mentioned cost of
living index.
7.2 Should the above-mentioned cost of living index from the Statisches
Bundesamt in Wiesbaden discontinue to be calculated in its current form,
it shall be replaced by the new index which takes its place.
7.3 The Lessor shall apply for the necessary approval for the preceeding
currency floating clause. Should the approval not be granted, both
parties shall be obliged to agree to an officially acceptable agreement
or an agreement which doesn't require official acceptance which
approximates as closely as possible the intention of the non-approved
clause.
(S) 8 INCIDENTAL COSTS
------------------------
8.1 The Lessee shall take care of the Rental Object independently and shall
bear the costs for the allocatable operating costs of the second
calculation ordinance which arise for the Lessor for the building or the
rental unit, in accordance with Enclosure 3 to (S) 27 subsection 1. The
overview of the operating costs is annexed in Enclosure 3.
8.2 Operating costs, which are charged to the Lessor, but which, in
accordance with Subsection 8.1, are to be paid by the Lessee, are to be
charged, upon production of evidence of their falling due, to the Lessee
by the Lessor. These invoices are due for payment within 10 days.
(S) 9 OFFSETTING, REDUCTION OF RENT
------------------------------------
Offsetting, rent reduction or assertion of a right to withhold shall not
be permissible unless the Lessee's claim is acknowledged by the Lessor or
becomes legally valid.
(S) 10 MAINTENANCE AND STRUCTURAL MODIFICATIONS
-----------------------------------------------
10.1 Repairs and maintenance costs to structural sections of the Rental Object
are to be borne by the Lessor.
10.2 The Lessee will carry out all repairs and maintenance work becoming
necessary within the rented rooms and on technical equipment which do not
fall under subsection 10.1 and will maintain all fixtures in a functional
condition. All superficial repairs are also included here.
10.3 The Lessee shall be exempted from his repair and maintenance obligation
pursuant to (S) 10.2 if the Lessor has a warranty claim for such cases
with regard to a third party.
10.4 Wear and damage which is caused by a non-contractual use of the rental
property, as well as damage caused by the Lessee, his employees or
other persons in connection with the business operations of the Lessee,
is to be repaired or reimbursed by the Lessee.
10.5 Structural alterations to the rental property after the commencement of
the Rental Period require the prior written agreement of the Lessor.
Any required official permits for such work are to be acquired by the
Lessee at his own cost and to be presented upon request to the Lessor.
10.6 The Lessee shall be authorized to attach fixtures which he deems
necessary for the utilization of the Rental Object, inasmuch as these
do not encroach upon the interests of the Lessor and/or other Lessees.
10.7 Official requirements, which are imposed with regard to the rental area
after delivery and which are based on the management or behaviour of
the Lessee or the manner of his operation, are to be fulfilled by the
Lessee at his own cost.
10.8 The Lessee accepts the complete liability for premises for the entire
Rental Object and liberates the Lessor from all claims by third parties
with regard to such liablities.
(S) 11 ADVERTISING
--------------------
11.1 If the Lessee intends to affix his company logo to the outer wall of
the Rental Object, he shall apply to the Lessor for permission in
writing, explaining in detail the proposed advertising attachment. The
Lessor shall approve of such an advertising attachment if it fits in
harmoniously and does not infringe on the interests of the Lessor
and/or other Lessees.
11.2 The Lessee shall acquire any necessary official authorizations for this
advertising at his own cost and shall observe all official regulations.
The Lessee shall, on request, provide the Lessor with evidence that the
required official permits for the advertising have been acquired.
11.3 The Lessee frees the Lessor from all costs involved in attaching and
maintaining the advertising attachments. Inasmuch as the advertising
fixture is supplied with electricity, the Lessee shall ensure that the
electricity supply takes place from his own Rental Object. All work is
to be carried out in professional quality.
11.4 Repairs to the advertising and repairs which could occur due to its
presence are the responsibility of the Lessee. The Lessee shall be
obliged to maintain his advertising fixtures in a clean, safe and
attractive condition.
11.5 If a temporary removal of the advertising fixture should become
necessary, due to work which has to be carried out by the Lessor, the
costs involved in the removal of the advertising fixture are to be
borne by the Lessee. Claims for damages, regardless of their form, will
not be acknowledged by the Lessor.
11.6 The approval for the attachment of advertising fixtures is valid for
the term of the existing Tenancy Agreement. The Lessor reserves the
right to revoke this right at any time due to important reasons. In
this case, the advertising attachment is to be removed, at the latest
at the end of the Tenancy Agreement, and the outer wall is to be
returned to its original condition.
11.7 The Lessee frees the Lessor from all damage caused in connection with
the attachment and presence of the advertising fixture - also in cases
of force majeur - and from all claims of third parties which can be
raised against the Lessor.
(S) 12 RETURN OF THE RENTAL OBJECT
-------------------------------------
12.1 The Lessee shall return the Rental Object to the Lessor at the end of
the rental term in a well cleaned state. The parts of the Rental
Object which were newly painted at the commencement of the Rental
Agreement (e.g. walls, ceilings, doors etc.) shall be returned in a
newly painted condition.
12.2 The Lessee shall eliminate all structural alterations on request of
the Lessor before returning the Rental Object and shall return the
Rental Object to its original condition before the alterations were
made.
12.3 The Lessee may remove attachments which he has affixed to the Rental
Object. The Lessor can, after the Tenancy Agreement has been
terminated, demand in writing the removal of remaining attachments for
payment of the current market price of the attachment.
The Lessor does not have a right to the attachments inasmuch as the
Lessee has a justified interest in taking them away. Attachments which
are not purchased by the Lessor at the current market price, can be
left by the Lessee only inasmuch as the Lessor does not demand their
removal. The Lessee shall return the Rental Object to its original
state after removal of the attachments.
(S) 13 SUBLETTING
--------------------
13.1 The Lessee shall only be authorized to sublet part or all of the
rental area upon agreement of the Lessor. The Lessor shall be able to
refuse permission for an important reason.
13.2 If the Lessee receives permission to sublet, the obligations of the
Lessee with regard to the Lessor to fulfill all the conditions in this
Agreement remain unchanged.
13.3 In the case of a future subletting, the Lessee now passes on to the
Lessor all claims that he has with regard to the subtenant as security
in addition to rights of lien to the extent of all due and future rent
claims and incidental costs.
(S) 14 ALIENATION OF THE RENTAL OBJECT
-----------------------------------------
In the case of the Rental Object being alienated, the Lessee releases
the Lessor as of the commencement of rental, from all Lessor's
obligations, inasmuch as the new owner takes over these obligations.
(S) 15 DESTRUCTION OF THE RENTAL OBJECT
------------------------------------------
In the case of the destruction of or damage to the Rental Object which
renders it unsuitable for use, the Lessor shall be obliged to return
the Rental Object to its original state. As soon as the Rental Object
is in its original condition, the Lessee shall be obliged to take it
over once again and resume rental payments, unless other legal reasons
force he to continue rental payments throughout.
(S) 16 ADDITIONAL OBLIGATIONS
--------------------------------
16.1 Lessor and Lessee promise to be considerate and to cooperate together
and with the other Lessees to ensure a peaceful co-existence.
16.2 The Lessee shall report damage to the Rental Object to the Lessor as
soon as he notices it.
16.3 Even if the Lessee does not intend to heat the rented rooms, he shall
be obliged to keep the temperature above freezing point.
16.4 The Lessee shall be obliged to close insurance policies necessary for
the fulfillment of his obligations under this Agreement, including
adequate glass breakage insurance and he shall observe all industrial,
fire prevention and police regulations when building up and carrying
out his business.
16.5 The Lessor or his agent shall be authorized to enter the rental rooms
during office hours with the prior permission of the Lessee.
If the tenancy is terminated, the Lessor shall be authorized to carry
out inspections with prospective tenants during office hours after
previously informing the Lessee of this intention.
(S) 17 SECURITY DEPOSIT
--------------------------
17.1 The Lessee shall be obliged to deliver to the Lessor an unrestricted,
absolute bank guaranty for 545,000 DM (in words: five hundred and
forty five thousand German Marks) from a large German bank by May 31,
1996 at the latest, as a security for his payment obligations. The
bank guaranty is to be such that the bank pays out the xxxxx at the
first request without a deposit clause.
17.2 The Lessee shall appropriately adjust the sum of the security deposit
if requested by the Lessor to do so, in the case of an increase in his
obligation to pay, whether this be in the form of a raise in the rent,
operating costs or of the V.A.T..
17.3 The Lessor shall be authorized to satisfy himself through this
security deposit for all claims based on this Agreement, should the
Lessee not fulfill his obligations completely or on time. If the
security deposit is made use of by the Lessor during the term of
tenancy, it is to be returned to the initial sum immediately, or in
the case of a bank guaranty, renewed.
17.4 The Lessee shall not be permitted to begin using the Rental Object
before the security deposit has been delivered. In the case of the
security deposit being delayed, the Lessee shall remain obliged to
make all payments relating to the Rental Object.
17.5 The security deposit/bank guaranty is to be returned 3 months after
moving out and contractual return of the Rental Object at the latest.
The Lessee remains, however, authorized to withhold a suitable amount
of the deposit or the bank guaranty until the calculation of the
annual operating costs. If Litigation is pending between Lessor and
Lessee based on the tenancy relationship, the security deposit/bank
guaranty can be retained with respect to the expected costs of this
litigation. The Lessee shall not be authorized to assign or pledge the
security deposit.
(S) 18 SUBSTITUTE PERFORMANCE, DAMAGES
-----------------------------------------
18.1 Should the Lessee not fulfill an obligation of this Agreement, despite
being requested to do so and a deadline being set with threat of
denial, the Lessor shall be authorized to revert to substitute
performance without any further announcement. The Lessee shall
reimburse the Lessor for any costs or damage incurred by the Lessor in
doing so.
18.2 Should the lessee not fulfill his obligations upon termination of
the tenancy, the Lessor shall be authorized to demand payment of the
sum of money which would have to be spent on the substitute
performance instead of the regulation in Subsection 18.1. The Lessor
is not obligated to carry out a substitute performance. Claims for
damages of the Lessor remain unaffected.
18.3 Should the Lessor not fulfill his obligations as laid down in (S)
10.1 despite expert proof followed by a written reminder and an
appropriate deadline being set, the Lessee shall be authorized to a
substitute performance. The costs for the substitute performance
are to be borne by the Lessor. In this case, the Lessee shall be
authorized to offset these costs. The costs for the expert shall be
shared by the parties.
(S) 19 PENALTY UNDER CONTRACT
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The Lessor shall be obliged to pay the Lessee a conventional penalty
of DM 75,000.00 for every month which the delivery deadline of
October 1, 1996 is not upheld. Payment of this penalty is due on the
second of each applicable month.
(S) 20 PERSONAL LIABILITY (CUMULATIVE ASSUMPTION OF DEBTS)
---------------------------------------------------------------
The partner of the Lessee:
VIKING OFFICE PRODUCTS INC.
00000 X. Xxxxxxxx Xxxxxx
Xxx Xxxxxxx, XX 00000
U.S.A.
shall be directly liable for the obligations of the Lessee from this
Agreement. The Lessee shall be obliged to produce confirmation of
the direct, personal liability of this above-mentioned company in
the legally binding form before February 28, 1996. The commencement
of tenancy mentioned in (S) 4.1 shall be extended by the period of
time by which the production of the assumption of debts is delayed
after February 28, 1996. The production of the assumption of debts
is a main obligation of the Lessee and thus comes under (S) 326 of
the German Civil Code.
(S) 21 FINAL PROVISIONS
----------------------------
21.1 Should a provision in this Agreement be or become invalid, or should
a gap be found in the provisions, the effectiveness of the remaining
provisions remains unchanged. The parties to the Agreement undertake
to replace the invalid provision with another, valid one which
approximates the commercial intention of the invalid provision as
closely as possible. A gap in the provisions is to be closed while
maintaining the commercial intentions of this Agreement.
21.2 The parties to this Agreement are aware of the statutory requirement
of written form in (S)(S) 566 section 1, 126 of the German Civil
Code. They hereby mutually undertake to carry out all actions and to
make all declarations necessary to fulfill the statutory requirement
of written form and not to terminate the Agreement with referral to
the non-compliance to the statutory written form, should this be
demanded at any time by either party. This shall be valid not only
for the closing of the original/main Agreement but also for
supplementary and amending agreements.
21.3 Alterations and amendments must be made in writing to be valid.
21.4 The following Enclosures are component part of this Tenancy
Agreement:
Enclosure 1 Building site plan
Enclosure 2 Building specifications
Enclosure 3 Overview of operating costs
21.5 Place of jurisdiction and performance is Munich, Germany.
Munich,
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Lessor Lessee
