| 6/06/96
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| 1/19/96
OFFICE/WAREHOUSE LEASE
THIS INDENTURE of lease, dated this 10th day of June, 1996, by and between OPUS
NORTHWEST, L.L.C., a Delaware limited liability company, owner of the Office/Warehouse Complex (as hereinafter defined), hereinafter referred to as "Lessor," and FARGO
ELECTRONICS, [NC., a Minnesota corporation, hereinafter referred to as "Lessee."
WITNESSETH:
That Lessor, in consideration of the rents and covenants hereinafter set forth, does hereby lease and let unto Lessee, and Lessee does hereby hire and take
from Lessor, that certain space shown and designated on the floor plan attached hereto and made a part hereof as Exhibit A, located in the Office/Warehouse Complex known and described as Flying
Cloud Business Centre located at ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇. The aforesaid space. leased and let unto Lessee is hereinafter referred to as the "Premises"; and the land (including
all easement areas appurtenant thereto) upon which the building or buildings of which the Premises are a part is hereinafter referred to as the "Property"; and the Property and all buildings and
improvements and personal property of Lessor used in connection with the operation or maintenance thereof located therein and thereon and the appurtenant parking facilities, if any, are hereinafter
called the "Office/Warehouse Complex."
TO HAVE AND TO HOLD THE SAME PREMISES, without any liability or obligation on the part of Lessor to make any alterations, improvements
or repairs of any kind on or about the Premises, except as expressly provided herein, for a term commencing on the earlier of (a) the fifteenth day of September, 1996, or (b) the date
65 days after written notice from Lessor to Lessee that the Base Building and Tenant Improvements required to be performed herein by Lessor will be completed, and ending an the fourteenth day
of September, 2001, unless sooner terminated, in the manner provided hereinafter, to be occupied and used by Lessee for office/warehouse/manufacturing purposes (all to the extent allowed by law) and
for no other purpose, subject to the covenants and agreements hereinafter contained.
ARTICLE I. BASE RENT: In consideration of the leasing aforesaid, Lessee agrees to pay to Lessor, at 700
Opus Center, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ or at such other place as Lessor from time to time may designate in writing, an annual rental of Two Hundred Ninety-One
Thousand Two Hundred Thirteen and 00/100 Dollars ($291,213.00), sometimes hereinafter referred to as the "Base Rent," payable monthly, in advance, in equal installments of Twenty-Four
Thousand Two Hundred Sixty-Seven and 75/100 Dollars ($24,267.75), commencing on the first day of the term and continuing on the first day of each and every month thereafter for the next succeeding
months during the balance of the term. If the term commences on a date other than the first day of a calendar month or ends on a date other than the last day of a calendar month, monthly rent for the
first month of the
term or the last month of the term, as the case may be, shall be prorated based upon the ratio that the number of days in the term within such month bears to the total number of days in such month.
ARTICLE II. ADDITIONAL RENT: In addition to the Base Rent payable by Lessee under the provisions of
Article I hereof, Lessee shall pay to Lessor "Additional Rent" as hereinafter provided for in this Article II.
For
purposes of this Article II, the parties hereto agree upon the following definitions:
A.The
term "Lease Year" shall mean each of those calendar years commencing with and including the year during which the term of this Lease commences, and ending with the calendar year
during which the term of this Lease (including any extensions or renewals) terminates.
B.The
term "Real Estate Taxes" shall mean and include all personal property taxes of Lessor relating to Lessor's personal property located in the Office/Warehouse Complex and used or
useful in connection with the operation and maintenance thereof, real estate taxes, and installments of special assessments, including interest thereon, relating to the Property and Office/Warehouse
Complex, and all other governmental charges, general and special, ordinary and extraordinary, foreseen as well as unforeseen, of any kind and nature whatsoever, or other tax, however described, which
is levied or assessed by the United States of America or the state in which the Office/Warehouse Complex is located or any political subdivision thereof, against Lessor or all or any part of the
Office/Warehouse Complex as a result of Lessor's ownership of the Property or Office/Warehouse Complex, and payable during the respective Lease Year. It shall not include any income tax, estate tax,
or inheritance tax.
C.The
term "Excess Real Estate Taxes" for an applicable Lease Year shall mean the amount of Real Estate Taxes payable during such applicable Lease Year in excess of the sum of
$-0-.
D.The
term "Operating Expenses" shall mean and include all expenses incurred with respect to the maintenance and operation of the Property and Office/Warehouse Complex as determined
by Lessor's accountant in accordance with generally accepted accounting principles consistently followed, including, but not limited to, insurance premiums, maintenance and repair costs, steam,
electricity, water, sewer, gas, and other utility charges, fuel, lighting, window washing, exterior common area janitorial services, exterior common area trash and rubbish removal, wages payable to
employees of Lessor whose duties are connected with the operation and maintenance of the Property and Office/Warehouse Complex (but only for the portion of their time allocable to work related to the
Office/Warehouse Complex), amounts paid to contractors or subcontractors for work or services performed in connection with the operation and maintenance of the Property and Office/Warehouse Complex,
all costs of uniforms, supplies and materials used in connection with the operation and maintenance of the Property and Office/ Warehouse Complex, all payroll taxes, unemployment insurance costs,
vacation allowances, and the cost of providing disability insurance or benefits, pensions, profit sharing benefits, hospitalization, retirement or other so-called fringe benefits, and any
other expense imposed on Lessor, its contractors or subcontractors, pursuant to law or pursuant to any collective bargaining agreement covering such employees properly apportioned for the time
allocable to work related to the Office/Warehouse Complex), all services, supplies, repairs, replacements or other expenses for maintaining and operating the Office/Warehouse Complex, reasonable
attorney's fees and costs in connection with appeal or contest of real estate or other taxes or levies, and such other expenses as may be ordinarily incurred in the operation and maintenance of an
office/warehouse complex and not specifically set forth herein, including reasonable management fees. The term "Operating Expenses" shall not include any capital improvement to the Office/Warehouse
Complex other than replacements required for normal maintenance and repair, nor shall it include repairs, restoration or other work occasioned by fire,
windstorm or other insured casualty expenses incurred in leasing or procuring tenants, leasing commissions, advertising expenses, expenses for renovating space for new tenants, legal expenses incident
to enforcement by Lessor of the terms of any lease, interest or principal payments on any mortgage or other indebtedness of Lessor, depreciation allowance or expense, nor any of the following:
1.Cost
of products and services otherwise includable in Operating Expenses but which represent an amount paid to Lessor or an affiliate of Lessor or an affiliate of any partner or
shareholder of Lessor or its affiliates, to the extent the same is in excess of the fair market value of said items (excluding management fees);
2.Any
management fee to Lessor or a third party or any costs of services generally included in a property management fee aggregating in excess of 4% of gross rental income from
tenants in the Office/Warehouse Complex; provided, however, the minimum management fee shall be 3% of gross rental income and any amount in excess thereof up to 4% of gross rental income shall only be
charged if such charge is a reasonable fair market charge for such services.
Notwithstanding
the foregoing, in the event Lessor installs equipment in or makes improvements or alterations to the Office/Warehouse Complex which are for the purpose of reducing energy costs,
maintenance costs or other Operating Expenses or which are required under any governmental laws, regulations, or ordinances which were not required at the date of commencement of the term of this
Lease, Lessor may include in Operating Expenses reasonable charges for interest on such investment and reasonable charges for depreciation on the same so as to amortize such investment over the
reasonable life of such equipment, improvement or alteration on a straight line basis: provided, however, the annual amount added to Operating Expenses for equipment or improvements or alterations for
the purpose of reducing energy costs, maintenance costs, or other Operating Expenses, shall not exceed Lessor's reasonable estimate of the annual actual savings which have resulted from such
installation, improvement or alteration. Operating Expenses shall also be deemed to include expenses incurred by Lessor in connection with city sidewalks adjacent to the Property and any pedestrian
walkway system (either above or below ground) or other public facility to which Lessor or the Office/Warehouse Complex is from time to time subject in connection with operations of the Property and
Office/Warehouse Complex.
E.The
term "Excess Operating Expenses" shall mean the amount of Operating Expenses for any applicable Lease Year in excess of the sum of
$-0-.F.The
term "Lessee's Pro Rata Share of Excess Real Estate Taxes" shall mean twenty-eight and 31/100ths percent (28.31%) of the Excess Real Estate Taxes for the applicable Lease Year,
and the term "Lessee's Pro Rata Share of Excess Operating Expenses" shall mean twenty-eight and 31/100ths percent (28.31%) of the Excess Operating Expenses for the applicable Lease Year. Said
percentages have been agreed upon by the parties hereto after due consideration of the rentable area of the Premises compared to the rentable area of the Office/Warehouse Complex; provided, however,
Lessee's above percentages for Lessee's Pro Rata Share of Excess Operating Expenses and for Lessee's Pro Rata Share of Excess Real Estate Taxes shall be amended for each Lease Year to the percentage
which the average rentable area of the Premises bears to the total average rentable area of the Office/ Warehouse Complex for such Lease Year. Rentable area shall in no event include basement storage
space or garage space.
G.Anything
herein to the contrary notwithstanding, it is agreed that in the event the Office/Warehouse Complex is not fully occupied during any Lease Year, a reasonable and equitable
adjustment shall be made by Lessor in computing the management fee portion of Operating Expenses for such year so that
the management fee portion of Operating Expenses shall be adjusted to the amount that would have been incurred had the Office/Warehouse Complex been fully occupied (with unoccupied space calculated at
the average rate occupying tenants are paying) during such year. Operating Expenses for the first Lease Year shall be calculated on a partial year basis only commencing on the commencement date of
this Lease.
As
to the Lease Year during which the term of this Lease commences, Lessor's estimated amount of Lessee's Pro Rata Share of Excess Real Estate Taxes and Lessor's estimated amount of Lessee's
Pro Rata Share of Excess Operating Expenses (based upon the estimated number of months of the term within such initial Lease Year) shall be the following sums:
Lessee's
Pro Rata Share of Excess Real Estate Taxes $6,737
Lessee's
Pro Rata Share of Excess Operating Expenses $9,263
As
to each Lease Year after the initial Lease Year, Lessor shall estimate for each such Lease Year (i) the total amount of Excess Real Estate Taxes; (ii) the total
amount of Excess Operating Expenses; (iii) Lessee's Pro Rata Share of Excess Real Estate Taxes; (iv) Lessee's Pro Rata Share of Excess Operating Expenses; (v) the computation of
the annual and monthly rental payable during such Lease Year as a result of increases or decreases in Lessee's Pro Rata Share of Excess Real Estate Taxes and Lessee's Pro Rata Share of Excess
Operating Expenses. Said estimate shall be in writing and shall be delivered or mailed to Lessee at Lessee's address designated pursuant to Article XVII(C).
Lessee
shall pay, as Additional Rent, the amount of Lessee's Pro Rata Share of Excess Real Estate Taxes for each Lease Year and Lessee's Pro Rata Share of Excess Operating Expenses
for each Lease Year, so estimated, in equal monthly installments, in advance, on the first day of each month during each applicable Lease Year. In the event that said estimate is delivered to Lessee
after the first day of January of the applicable Lease Year, said amount, so estimated, shall be payable as Additional Rent, in equal monthly installments, in advance, on the first day of each month
over the balance of such Lease Year, with the number of installments being equal to the number of full calendar months remaining in such Lease Year.
From
time to time during any applicable Lease Year, Lessor may reestimate the amount of Excess Real Estate Taxes and Excess Operating Expenses and Lessee's Pro Rata Share thereof, and
in such event Lessor shall notify Lessee, in writing, of such reestimate in the manner above set forth and fix monthly installments for the then remaining balance of such Lease Year in an amount
sufficient to pay the reestimated amount over the balance of such Lease Year after giving credit for payments made by Lessee on the previous estimate.
Upon
completion of each Lease Year, Lessor shall cause its accountants to determine the actual amount of Excess Real Estate Taxes and Excess Operating Expenses for such Lease Year and
Lessee's Pro Rata Share thereof and deliver a written certification of the amounts thereof to Lessee after the end of each Lease Year. If Lessee has paid less than its Pro Rata Share of Excess Real
Estate Taxes or its Pro Rata Share of Excess Operating Expenses for any Lease Year, Lessee shall pay the balance of its Pro Rata Share of the same within ten (10) days after the receipt of such
statement. If Lessee has paid more than its Pro Rata Share of Excess Real Estate Taxes or its Pro Rata Share of Excess Operating Expenses for any Lease Year, Lessor shall, at Lessee's option, either
(i) refund such excess, or (ii) credit such excess against the most current monthly installment or installments due Lessor for its estimate of Lessee's Pro Rata Share of Excess Real
Estate Taxes and Lessee's Pro Rata Share of Excess Operating Expenses for the next following Lease Year. A pro rata adjustment shall be made for
a fractional Lease Year occurring during the term of this Lease or any renewal or extension thereof based upon the number of days of the term of this Lease during said Lease Year as compared to three
hundred sixty-five (365) days and all additional sums payable by Lessee or credits due Lessee as a result of the provisions of this
Article II shall be adjusted accordingly.
Further,
Lessee shall pay, also as Additional Rent, any tax or excise on rents, gross receipts tax, or other tax, however described, which is levied or assessed by the United States
of America or the state in which the Office/Warehouse Complex is located or any political subdivision thereof. against Lessor in respect to the Base Rent, Additional Rent, or other charges reserved
under this Lease or as a result of Lessor's receipt of such rents or other charges accruing under this Lease; provided, however, Lessee shall have no obligation to pay net income taxes of Lessor.
ARTICLE III. OVERDUE AMOUNTS—RENT INDEPENDENT: Any installment of Base Rent, Additional
Rent, or other charges to be paid by Lessee accruing under the provisions of this Lease, which shall not be paid when due, shall bear interest at the rate of twelve percent (12%) per annum from the
date when the same is due until the same shall be paid, but if such rate exceeds the maximum interest rate permitted by law, such rate shall be reduced to the highest rate allowed by law under the
circumstances. Lessee's covenants to pay the Base Rent and the Additional Rent are independent of any other covenant, condition, provision or agreement herein contained.
ARTICLE IV. POSSESSION OF PREMISES: If Lessor shall be unable to give possession of the Premises on the
date of the commencement of the term because the construction of the Office/ Warehouse Complex or the completion of the Premises has not been sufficiently completed to make the Premises ready for
occupancy, or for any other reason, Lessor shall not be subject to any claims, damages or liabilities for the failure to give possession on said date. UndS said circumstances, the rent reserved and
covenant to pay same shall not commence until possession of the Premises is given or the Premises are ready for occupancy, whichever is earlier, and failure to give possession on the date of
commencement of the term shall in no way affect the validity of this Lease or the obligations of Lessee hereunder, nor shall the same be construed in any way to extend the expiration date of the term.
If Lessee is given and accepts possession of the Premises on a date earlier than the date above specified for commencement of the term, the rent reserved herein and all covenants, agreements and
obligations herein and the term of this Lease shall commence on the date that possession of the Premises is given to Lessee.
The
acceptance of possession by Lessee shall be deemed conclusively to establish that the Premises and all other improvements of the Office/Warehouse Complex required to be
constructed by Lessor for use thereof by Lessee hereunder have been completed unless Lessee notifies Lessor in writing within sixty (60) days after commencement of the term as to any items not
completed. Lessee waives any claim as to matters not listed in said notice, except as to latent defects.
ARTICLE V. SERVICES:
A.All
electric lighting bulbs and tubes and all ballasts and starters within the Premises shall be replaced by Lessee at the expense of Lessee.
B.Subject
to Article II hereof, Lessor shall provide maintenance in good order, condition and repair of the parking facilities and all driveways leading thereto and keeping the
same free from any unreasonable accumulation of snow. Lessor shall keep and maintain the landscaped area and parking facilities in a neat and orderly condition. Lessor reserves the right to designate
areas of the appurtenant parking facilities where Lessee, its agents, employees and invitees shall park and may
exclude Lessee, its agents, employees and invitees from parking in other areas as designated by Lessor, provided. however, Lessor shall not be liable to Lessee for the failure of any tenant, its
invitees. employees, agents, and customers to abide by Lessor's designations or restrictions. Notwithstanding the above, Lessor shall use reasonable effort to enforce such designations or restrictions
but shall not be required to terminate any leases or to commence any legal action against any party in respect thereto.
C.Lessee
shall provide all cleaning and janitorial services required in respect to the Premises.
No
interruption in, or temporary stoppage of, any of the aforesaid services caused by repairs, renewals, improvements, alterations, strikes, lockouts, labor controversy, accidents,
inability to obtain fuel or supplies, or other causes shall be deemed an eviction or disturbance of Lessee's use and possession, or render Lessor liable for damages, by abatement of rent or otherwise
or relieve Lessee from any obligation herein set forth. In no event shall Lessor be required to provide any heat, air conditioning, electricity or other service in excess of that permitted by
voluntary or involuntary guidelines or laws, ordinances or regulations of governmental authority.
ARTICLE VI. USE: The Premises shall be used for office/warehouse/manufacturing purposes, and for
carrying on such activities as may be incidental thereto; provided, however, Lessee may not use or occupy the Premises, or knowingly permit the Premises to be used or occupied, contrary to any
statute, rule, order, ordinance, requirement or regulation applicable thereto, or in any manner which would violate any certificate of occupancy or permit affecting the same, or which would cause
structural injury to the Premises or cause the value or usefulness of the Premises, or any part thereof, substantially to diminish (reasonable wear and tear excepted) or which would constitute a
private or public nuisance or waste, and Lessee agrees that it will promptly, upon discovery of any such use, take all necessary steps to compel the discontinuance of such use.
ARTICLE VII. CERTAIN RIGHTS RESERVED BY LESSOR: Lessor reserves the following rights exercisable
without notice and without liability to Lessee and without effecting an eviction, constructive or actual, or disturbance of Lessee's use or possession, or giving rise to any claim for setoff or
abatement of rent:
▇.▇▇
control, install, affix and maintain any and all signs on the Property, or on the exterior of the Office/Warehouse Complex and in any common corridors, entrances and other common
areas thereof, except those signs within the Premises not visible from outside the Premises.
▇.▇▇
reasonably designate, limit, restrict and control any service in or to the Office/Warehouse Complex, including but not limited to the designation of sources from which Lessee may
obtain sign painting and lettering. Any restriction, designation, limitation or control imposed by reason of this subparagraph shall be imposed uniformly on Lessee and other tenants occupying space in
the Office/ Warehouse Complex.
▇.▇▇
retain at all times and to use in appropriate instances keys to all doors within and into the Premises. No locks shall be changed without the prior written consent of Lessor.
This provision shall not apply to Lessee's safes, or other areas maintained by Lessee for the safety and security of monies, securities, negotiable instruments or like items.
▇.▇▇
make repairs, alterations, additions, or improvements, whether structural or otherwise, in and about the Office/Warehouse Complex, or any part thereof, and for such purposes to
enter upon the Premises, and during the continuation of any of said work, to temporarily close doors, entryways, public
spaces, and corridors in the Office/Warehouse Complex and to interrupt or temporarily suspend services and facilities.
E.Lessee
shall not overload the floor or structural components of the Office/Warehouse Complex.
ARTICLE VIII. ALTERATIONS AND IMPROVEMENTS: Lessee shall not make any improvements, alterations,
additions or installations in or to the Premises (hereinafter referred to as the "Work") in excess of $25,000 in the aggregate in any twelve-month period or which modifies the electrical (other than
production machinery and equipment changes and lighting, provided such changes in lighting do not adversely affect usability as an office/warehouse), mechanical, or structural aspects of the Office/
Warehouse Complex or the roof of the Office/Warehouse Complex without Lessor's prior written consent. Along with any request for Lessor's consent and before commencement of the Work or delivery of any
materials to be used in the Work to the Premises or into the Office/Warehouse Complex, Lessee shall furnish Lessor with plans and specifications, names and addresses of contractors, copies of
contracts, necessary permits and licenses, and an indemnification in such form and amount as may be reasonably satisfactory to Lessor and a performance bond executed by a commercial surety reasonably
satisfactory to Lessor, and in an amount equal to the Work and the payment of all liens for labor and material arising therefrom. Lessee agrees to defend and hold Lessor forever harmless from any and
all claims and liabilities of any kind and description which may arise out of or be connected in any way with said improvements, alterations, additions or installations. All Work shall be done only by
contractors or mechanics reasonably approved by Lessor and shall be done in accordance with good
architectural and engineering practice. All work done by Lessee, its agents, employees, or contractors shall be done in such a manner as to avoid labor disputes. Lessee shall pay the cost of all such
improvements, alterations, additions or installations (including a reasonable charge for Lessor's engineering time), and also the cost of painting, restoring, or repairing the Premises and the Office/
Warehouse Complex occasioned by such improvements, alterations, additions or installations. Upon completion of the Work, Lessee shall furnish Lessor with contractor's affidavits and full and final
waivers of liens, and receipted bills covering all labor and materials expended and used. The Work shall comply with all insurance requirements and all laws, ordinances, rules and regulations of all
governmental authorities and shall be constructed in a good and workmanlike manner. Lessee shall permit Lessor to inspect construction operations in connection with the Work. Lessee shall not be
allowed to make any alterations, modifications, improvements, additions, or installations if such action results or would result in a labor dispute or otherwise would materially interfere with
Lessor's operation of the Office/Warehouse Complex. Lessor, by written notice to Lessee given at or prior to termination of this Lease, may require Lessee to remove any improvements, additions or
installation installed by Lessee in the Premises at Lessee's sole cost and expense, and repair or restore any damage caused by the installation and removal of such improvements, additions, or
installations; provided, however, the only improvements, additions or installations which Lessee shall remove shall be those specified in such notice. At the time approval is requested or granted or
at the time Lessee requests Lessor to make a designation pursuant to the provisions hereof, as to any specific change or alteration, Lessor shall designate which portion of such change or alteration
shall be removed, repaired and restored at termination of this Lease and which portion may be surrendered at termination of this Lease without removal, repair and restoration and Lessor shall not be
arbitrary or capricious in respect to any such designation. If no designation is made at the time approval or designation is requested or granted, Lessee shall not be required to remove and shall not
remove the items covered by such request or grant. Further, in respect to items as to which no specific written approval is requested or granted, Lessor may require, upon termination of this Lease,
the removal (and repair of resulting damage) of any such applicable improvement, alteration, addition or installation installed in the Premises.
ARTICLE IX. REPAIRS: Lessee shall, during the term of this Lease, at Lessee's expense, keep the
Premises in as good order, condition and repair as they were at the time Lessee took possession of the same, reasonable wear and tear and insured damage from fire and other casualties excepted. Lessee
shall keep the Premises in a neat and sanitary condition and shall not commit any nuisance or waste on the Premises or in, on, or about the Office/Warehouse Complex, throw foreign substances in the
plumbing facilities, or waste any of the utilities furnished by Lessor. All uninsured damage or injury to the Premises, or to the Office/Warehouse Complex caused by Lessee moving furniture, fixtures,
equipment, or other devices in or out of the Premises or Office/Warehouse Complex or by installation or removal of furniture, fixtures, equipment, devices or other property of Lessee, its agents,
contractors, servants or employees, due to carelessness, omission, neglect, improper conduct, or other cause of Lessee, its servants, employees, agents, visitors, or licensees, shall be repaired,
restored and replaced promptly by Lessee at its sole cast and expense to the reasonable satisfaction of Lessor. All repairs, restorations and replacements shall be in quality and class equal to the
original work.
Lessor
or its employees, or agents, shall have the right to enter the Premises at any reasonable time or times for the purpose of inspection, cleaning, repairs, altering, or improving
the same but nothing contained herein shall be construed as imposing any obligation on Lessor to make any repairs, alterations or improvements which are the obligation of Lessee.
Lessee
and Lessor shall cooperate to arrange for a joint inspection of the Premises prior to Lessee's vacation of the Premises.
ARTICLE X. INSURANCE: Lessor shall keep the Office/Warehouse Complex insured for the benefit of Lessor
in an amount equivalent to the full replacement value thereof (excluding foundation, grading and excavation costs) against:
(a)loss
or damage by fire; and
(b)such
other risk or risks of a similar or dissimilar nature as are now, or may in the future be, customarily covered with respect to buildings and improvements similar In
construction, general location, use, occupancy and design to the Office/Warehouse Complex, including, but without limiting the generality of the foregoing, windstorms, hail, explosion, vandalism,
malicious mischief, civil commotion, and such other coverage as may be deemed necessary by Lessor, providing such additional coverage is obtainable and providing such additional coverage is such as is
customarily carried with respect to buildings and improvements similar in construction, general location, use, occupancy and design to the Office/Warehouse Complex.
Lessor
agrees that such policy or policies of insurance shall contain a waiver of subrogation clause as to Lessee and Lessor waives, releases and discharges Lessee from all claims or
demands whatsoever which Lessor may have or acquire arising out of damage to or destruction of the Office/Warehouse Complex or Lessor's business therein occasioned by fire or other casualty, which
such claim or demand may arise because of the negligence or fault of Lessee, its agents, employees, customers or business invitees, or otherwise, and Lessor agrees to look to the insurance coverage
only in the event of such loss; provided, however, Lessor does not release or waive any rights against Lessee, or discharge Lessee from any claims, losses or expenses arising out of intentional acts
of Lessee or violations by Lessee or its agents, contractors, or employees of any environmental covenant herein or of any laws relating to the environment or hazardous materials. Notwithstanding the
foregoing, Lessee shall be obligated to pay the rental called for hereunder in the event of damage to or destruction of the Premises or the Office/ Warehouse Complex if such damage or destruction is
occasioned by the negligence or fault of Lessee,
its agents or employees. Insurance premiums paid thereon shall be a portion of the "Operating Expenses" described in Article II hereof.
Lessee
shall keep all of its machinery, equipment, furniture, fixtures, personal property (including also property under the care, custody or control of Lessee) and business interests
which may be located in, upon, or about the Premises insured for the benefit of Lessee in an amount equivalent to the full replacement value or insurable value thereof against:
(a)loss
or damage by fire; and
(b)such
other risk or risks of a similar or dissimilar nature as are now, or may in the future be, customarily covered with respect to a tenant's machinery, equipment, furniture,
fixtures, personal property and business located in a building similar in construction, general location, use, occupancy and design to the Office/Warehouse Complex, including, but without limiting the
generality of the foregoing, windstorms, hail, explosions, vandalism, theft, malicious mischief, civil commotion, and such other coverage as Lessee may deem appropriate or necessary.
Lessee
agrees that such policy or policies of insurance shall contain a waiver of subrogation clause as to Lessor and Lessee waives, releases and discharges Lessor from all claims or
demands whatsoever which Lessee may have or acquire arising out of damage to or destruction of the machinery, equipment, furniture, fixtures, personal property, and business of Lessee occasioned by
fire or other casualty, whether such claim or demand may arise because of the negligence or fault (other than intentional acts) of Lessor, its agents, employees, subcontractors or otherwise, and
Lessee agrees to look to the insurance coverage only in the event of such loss.
Lessor
shall, as a portion of the Operating Expenses defined in Article II, maintain, for its benefit and the benefit of its managing agent, commercial general liability
insurance against claims for personal
injury, death or property damage occurring upon, in or about the Office/Warehouse Complex, such insurance to afford protection to Lessor and its managing agent.
Lessee
shall, at Lessee's sole cost and expense but for the mutual benefit of Lessor, its managing agent and Lessee, maintain commercial general liability insurance against claims for
personal injury, death or property damage occurring upon, in or about the Premises, such insurance to afford protection to Lessor, its managing agent and Lessee to the limit of not less than Three
Million and 00/100 Dollars ($3,000,000.00) single limit coverage on an occurrence basis. Such policies of insurance shall be written in companies with Best's ratings of A-:X or better,
naming Lessor and its managing agent as additional insureds thereunder, and such policies, or a memorandum or certificate of such insurance, shall be delivered to Lessor endorsed "Premium Paid" by the
company or agency issuing the same or accompanied by other evidence satisfactory to Lessor that the premium thereon has been paid. At such time as insurance limits required of tenants in
Office/Warehouse buildings in the area in which the Office/Warehouse Complex is located are generally increased to greater amounts, Lessor shall have the right to require such greater limits as may
then be customary. Lessee agrees to include in such policy the contractual liability coverage insuring Lessee's indemnification obligations provided for herein. Any such coverage shall be deemed
primary to any liability coverage secured by Lessor.
Subject
to the releases and waivers provided herein, Lessee agrees to indemnify and save Lessor and its managing agent harmless against and from any and all claims by or on behalf of
any person or persons, firm or firms, corporation or corporations, arising from any breach or default on the part of Lessee in the performance of any covenant or agreement on the part of Lessee to be
performed, pursuant to the terms of this Lease, or arising from any act or negligence on the part of Lessee or its agents,
contractors, servants, employees or licensees, or arising from any accident, injury or damage to the extent caused by Lessee, its agents, and employees to any person, firm or corporation occurring
during the term of this Lease or any renewal thereof, in or about the Premises and Office/Warehouse Complex, and from and against all costs, reasonable counsel fees, expenses and liabilities incurred
in or about any such claim or action or proceeding brought thereon; and in case any action or proceeding be brought against Lessor or its managing agent by reason of any such claim, Lessee, upon
notice from Lessor, covenants to resist or defend such action or proceeding by counsel reasonably satisfactory to Lessor.
Subject
to the releases and waivers provided for herein, Lessor agrees to indemnify and save Lessee harmless against and from any losses, damages, claims and expenses, including
attorneys fees, arising from any breach, inaccuracy or default by Lessor in any of its warranties, representations and covenants under this Lease or arising from any and all claims by or on behalf of
any person or persons, firm or firms, corporation or corporations, arising from any breach or default on the part of Lessor in the performance of any covenants or agreement on the part of Lessor to be
performed, pursuant to the terms of this Lease, or arising from any act or negligence on the part of Lessor or its agents, contractors, servants, employees or licensees, or arising from any accident,
injury or damage to the extent caused by Lessor, its agents, and employees to any person, firm or corporation occurring during the term of this Lease or any renewal thereof, in or about the Premises
and Office/Warehouse Complex, and from and against all costs, reasonable counsel fees, expenses and liabilities incurred in or about any such claim or action or proceeding brought thereon; and in case
any action or proceeding be brought against Lessee by reason of any such claim, Lessor, upon notice from Lessee, covenants to resist or defend such action or proceeding by counsel reasonably
satisfactory to Lessee.
Lessee
agrees, to the extent not expressly prohibited by law, that Lessor, its agents, employees and servants shall not be liable, and Lessee waives all claims for damage to property
and business sustained during the term of this Lease by Lessee occurring in or about the Office/Warehouse Complex, resulting directly or indirectly from any existing or future condition, defect,
matter or thing in the Premises, the Office/Warehouse Complex, or any part thereof, or from equipment or appurtenances becoming out of repair or from accident, or from any occurrence or act or
omission of Lessor, its agents, employees or
servants, or any tenant or occupant of the Building or any other person. This paragraph shall apply especially, but not exclusively, to damage caused as aforesaid or by the flooding of basements or
other subsurface areas, or by refrigerators, sprinkling devices, air conditioning apparatus, water, snow, frost. steam, excessive heat or cold, falling plaster, broken glass, sewage, gas, odors or
noise, or the bursting or leaking of pipes or plumbing fixtures, and shall apply equally, whether any such damage results from the act or omission of other tenants or occupants in the Office/Warehouse
Complex or any other persons, and whether such damage be caused by or result from any of the aforesaid, or shall be caused by or result from other circumstances of a similar or dissimilar nature.
Anything
herein to the contrary notwithstanding, in the event any damage to the Office/Warehouse Complex results from any act or omission of Lessee, its agents, employees or invitees,
and all or any portion of Lessor's loss is "deductible," Lessee shall pay to Lessor the amount of such deductible loss (not to exceed $1,000 per event). All property in the Office/Warehouse Complex or
on the Premises belonging to Lessee, its agents, employees. invitees or otherwise located at the Premises, shall be at the risk of Lessee only, and Lessor shall not be liable for damage thereto or
theft, misappropriation or loss thereof and Lessee agrees to defend and hold Lessor, its agents, employees and servants harmless and indemnify them against claims and liability for injuries to such
property.
ARTICLE XI. ASSIGNMENT AND SUBLETTING: Lessee shall not, without the prior written consent of Lessor,
(i) transfer, pledge, mortgage or assign this Lease or any interest hereunder; (ii) permit any
assignment of this Lease by voluntary act, operation of law or otherwise; (iii) sublet the Premises or any part thereof; or (iv) permit the use of the Premises by any parties other than
Tenant, its agents and employees. Lessee shall seek such written consent of Lessor by a written request therefor, setting forth such information as Lessor may deem necessary. Lessee shall, by notice
in writing, advise Lessor of its intention from, on and after a stated date (which shall not be less than ten [10] business days after date of Lessee's notice), to assign this
Lease or to sublet any part or all of the Premises for the balance or any part of the term. Lessee's notice shall include all of the terms of the proposed assignment or sublease and shall state the
consideration therefor. Lessor shall either consent to such proposed sublease or assignment or refuse to consent in writing on or before the date ten (10) days after receipt of Lessee's notice
and the aforementioned information. Failure of Lessor to indicate its consent or refusal to consent within such ten (10) day period shall constitute a consent to such sublease or assignment,
subject to the other conditions of this Article XI other than Lessor's consent.
Lessor
will not unreasonably withhold its consent to Lessee's assignment of the Lease or subletting such space to the party identified in Lessee's notice, provided, however, that in
the: event Lessor consents to any such assignment or subletting, and as a condition thereto, except as to the first 30% of the rentable area of the Premises sublet or assigned, Lessee shall pay to
Lessor ninety percent (90%) of all profit (after deduction for costs of commissions and tenant improvements) derived' by Lessee from such assignment or subletting. For purposes of the foregoing,
profit shall be deemed to include, but shall not be limited to, the amount of all rent payable by such assignee or sublessee in excess of the Base Rent, and rent adjustments, payable by Lessee under
this Lease. If a part of the consideration for such assignment or subletting shall be payable other than in cash, the payment to Lessor shall be in cash for its share of any non-cash
consideration based upon the fair market value thereof.
Lessee
shall and hereby agrees that it will furnish to Lessor upon request from Lessor a complete statement, certified by an independent certified public accountant, setting forth in
detail the computation of all profit derived and to be derived from such assignment or subletting, such computation to be made in accordance with generally accepted accounting principles. Lessee
agrees that Lessor or its authorized representatives shall be given access at all reasonable times to the books, records and papers of Lessee relating to any such assignment or subletting, and Lessor
shall have the right to make copies thereof The percentage of Lessee's profit due Lessor hereunder shall be paid to
Lessor within five (5) days of receipt by Lessee of all payments made from time to time by such assignee or sublessee to Lessee.
For
purposes of the foregoing, any change in the partners of Lessee, if Lessee is a partnership, or, if Lessee is a corporation, any transfer of any or all of the shares of stock of
Lessee by sale, assignment, operation of law or otherwise resulting in a change in the present control of such corporation by the person or persons owning a majority of such shares as of the date of
this Lease, shall be deemed to be an assignment within the meaning of this Article XI, except this sentence shall not apply if Lessee provides to Lessor evidence reasonably satisfactory to
Lessor that there is no material reduction in the "net worth" of Lessee in connection with such transfer.
Any
subletting or assignment hereunder shall not release or discharge Lessee of or from any liability, whether past, present or future, under this Lease, and Lessee shall continue
fully liable thereunder. The subtenant or subtenants or assignee shall agree in a form satisfactory to Lessor to comply with and be bound by all of the terms, covenants, conditions, provisions and
agreements of this Lease to the extent of the space sublet or assigned, and Lessee shall deliver to Lessor promptly after execution an executed copy of each such sublease or assignment and an
agreement of compliance by each such subtenant or assignee. Consent by Lessor to any assignment of this Lease or to any subletting of the
Premises shall not be a waiver of Lessor's rights under this Article as to any subsequent assignment or subletting.
Anything
herein to the contrary notwithstanding, Lessee shall have the right to assign or sublease the Premises to any U.S. entity or any U.S. person or entity which is an entity or
person controlled (directly or indirectly) by Lessee or to an entity or person controlling at least 50% of the voting interest of Lessee or to an entity
or person with whom Lessee merges in a statutory merger or to whom substantially all of the assets of Lessee are transferred, without the consent of Lessor, subject to the other provisions of
Article XI. Such assignment or subletting shall be subject to the following conditions:
(a)Lessee
shall deliver to Lessor an executed copy of each complete sublease or assignment within ten (10) business days after the execution thereof;
(b)That
nothing herein contained or contained in the sublease or assignment shall relieve Lessee or any guarantor or surety of Lessee's obligations of their obligations under this
Lease agreement and any applicable guarantees and Lessee shall remain liable for the payment of all rent and the performance of all terms and conditions in this Lease contained on Lessee's part to be
paid or performed;
(c)That
any sublease shall be subject to the terms, covenants and conditions of this Lease and any assignee shall assume, in writing, for the benefit of Lessor, all obligations of this
Lease agreement and the form of said assumption shall be subject to the reasonable approval of Lessor;
(d)Subsequent
to any assignment, Lessor need not consent to any action, amendment or modification of this Lease unless the initial Lessee and all prior assignees and guarantors consent
to such amendment or modification and confirm their continuing liability as Lessee under the Lease as amended or modified.
Any
sale, assignment, mortgage, transfer, or subletting of this Lease which is not in compliance with the provisions of this Article XI shall be of no effect and void. Lessor's
right to assign its interest in this Lease shall remain unqualified. Lessor may make a reasonable charge to Lessee for any reasonable attorney's fees or expenses incident to a review of any
documentation related to any proposed assignment or subletting by Lessee.
Notwithstanding
anything to the contrary in this Lease, Lessee shall not without first receiving Lessor's prior written consent assign its rights under this Lease or sublet all or any
part of the Premises to a person, firm or corporation which is (or, immediately prior to such subletting or assignment, was) a tenant or occupant of the Office/Warehouse Complex or any building on
property contiguous to the Office/Warehouse Complex owned by Lessor under the Lease. Lessor's consent may be withheld in Lessor's sole discretion except Lessor shall not withhold consent by reason of
this paragraph if the proposed tenant's rentable area requirements cannot be met by Lessor and can be met by Lessee.
ARTICLE XII. DAMAGE BY FIRE OR OTHER CASUALTY: If fire or other casualty shall render the whole or any
material portion of the Premises untenantable, and the Premises can reasonably be expected to be made tenantable within one hundred twenty (120) days from the date of such event, then Lessor
shall repair and restore the Premises and the Office/Warehouse Complex to as near their condition prior to the fire or other casualty as is reasonably possible within such one hundred twenty
(120) day period (subject to delays for causes beyond Lessor's reasonable control) and notify Lessee that it will be doing so, such notice to be mailed within thirty (30) days from the
date of such damage or destruction, and this Lease shall remain in full force and effect, but the rent (Base Rent and Additional Rent) for the period during which the Premises are untenantable shall
be abated pro rata (based upon the portion of the Premises which is untenantable). If Lessor is required to repair the Office/Warehouse Complex and/or the Premises, as aforesaid, said work shall be
undertaken and prosecuted with all due diligence and speed.
If
fire or other casualty shall render the whole or any material part of the Premises untenantable and the Premises cannot reasonably be expected to be made tenantable within one
hundred twenty (120) days from the date of such event, then either party, by notice in writing to the other mailed within thirty (30) days from the date of such damage or destruction,
may terminate this Lease effective upon a date within thirty (30) days from the date of such notice.
In
the event that more than fifty percent(50%) of the value of the Office/Warehouse Complex is damaged or destroyed by fire or other
casualty, and irrespective of whether the Office/Warehouse Complex or Premises can be made tenantable within one hundred twenty (120) days thereafter, then at Lessor's option, by written notice
to Lessee, mailed within forty-five (45) days from the date of such damage or destruction, Lessor may terminate this Lease effective upon a
date within ninety (90) days from the date of such notice to Lessee.
If
fire or other casualty shall render the whole or any material part of the Premises untenantable and the Premises cannot reasonably be expected to be made tenantable within one
hundred twenty (120) days from the date of such event and neither party hereto terminates this Lease pursuant to its rights herein or in the event that more than fifty
percent (50%) of the value of the Office/Warehouse Complex is damaged or destroyed by fire or other casualty, and Lessor does not
terminate this Lease pursuant to its option granted herein, or in the event that fifty percent (50%) or less of the value of the
Office/Warehouse Complex is damaged or destroyed by fire or other casualty and neither the whole nor any material portion of the Premises is rendered untenantable, then Lessor shall repair and restore
the Premises and the Office/Warehouse Complex to as near their condition prior to the fire or other casualty as is reasonably possible with all due diligence and speed (subject to delays for causes
beyond Lessor's reasonable control) and the rent for the period during which the Premises are untenantable shall be abated pro rata (based upon the portion of the Premises which is untenantable). In
no event shall Lessor be obligated to repair or restore any special equipment or improvements installed by Lessee at Lessee's expense; provided, however, this sentence shall not apply to any
improvements listed in Exhibit D.
In
the event of a termination of this Lease pursuant to this Article, rent shall be apportioned on a per diem basis and paid to the date of the fire or other casualty.
ARTICLE XIII. EMINENT DOMAIN: If the whole of or any substantial part of the Premises is taken by any public
authority under the power of eminent domain, or taken in any manner for any public or quasi-public use, so as to render (in Lessee's reasonable judgment) the remaining portion of the Premises
unsuitable for the purposes intended hereunder, then the term of this Lease shall cease as of the day possession shall be taken by such public authority and Lessor shall make a pro rata refund of any
prepaid rent. All damages awarded for such taking under the power of eminent domain or any like proceedings shall belong to and be the property of Lessor, Lessee hereby assigning to Lessor its
interest, if any, in said award. In the event that fifty percent (50%) or more of the building area or fifty percent (50%) or more of the value of the Office/Warehouse Complex is taken by public
authority under the power of eminent domain, then, at Lessor's option, by written notice to Lessee, mailed within sixty (60) days from the date possession shall be taken by such public
authority, Lessor may terminate this Lease effective upon a date within ninety (90) days from the date of such notice to Lessee. Further, if the whole of or any material part of the Premises is
taken by public authority under the power of eminent domain, or taken in any manner for any public or quasi-public use, so as to render the remaining portion of the Premises unsuitable in Lessee's
reasonable opinion, for the purposes intended hereunder, upon delivery of possession to the condemning authority pursuant to the proceedings. Lessee may, at its option, terminate this Lease as to the
remainder of the Premises by written notice to Lessor, such notice to be given to Lessor within thirty (30) days after Lessee receives notice of the taking. Lessee shall not have the right to
terminate this Lease pursuant to the preceding sentence unless (i) the business of Lessee conducted in the portion of the Premises taken cannot in Lessee's reasonable judgment be carried on
with substantially the same utility and efficiency in the remainder of the Premises (or any substitute space securable by Lessee pursuant to clause (ii) hereof); and (ii) Lessee cannot
secure substantially similar (in Lessee's reasonable judgment) alternate space upon the same terms and conditions as set forth in this Lease (including rental) from Lessor in the Office/Warehouse
Complex. Any notice of termination shall specify the date no more than sixty (60) days after the giving of such notice as the date for such termination.
Anything
in this Article XIII to the contrary notwithstanding, Lessee shall have the right to prove in any condemnation proceedings and to receive any separate award which may
be made for damages to or condemnation of Lessee's movable trade fixtures and equipment and for moving expenses; provided, however, Lessee shall in no event have any right to receive any award for its
interest in this Lease or for loss of leasehold. Anything in this Article XIII to the contrary notwithstanding, in the event of a partial condemnation of the Office/Warehouse Complex or the
Premises and this Lease is not terminated, Lessor shall, at its sole cost and expense, restore the Premises and Office/Warehouse Complex to a complete architectural unit and the Base Rent provided for
herein during the period from and after the date of delivery of possession pursuant to such proceedings to the termination of this Lease shall be reduced to a sum equal to the product of the Base Rent
provided for herein multiplied by a fraction, the numerator of which is the fair market rent of the Premises after such taking and after the same has been restored to a complete architectural unit,
and the denominator of which is the fair market rent of the Premises prior to such taking.
ARTICLE XIV. SURRENDER OF PREMISES: On the last day of the term of this Lease, or on the sooner termination
thereof, Lessee shall peaceably surrender the Premises in good condition and repair consistent with Lessee's duty to make repairs as herein provided. On or before the last day of the term of this
Lease, or the date of sooner termination thereof, Lessee shall, at its sole cost and expense, remove all of its property and trade fixtures and equipment from the Premises, and all property not
removed shall be deemed abandoned. Lessee hereby appoints Lessor its agent to remove all property
of Lessee from the Premises upon termination of this Lease and to cause its transportation and storage for Lessee's benefit, all at the sole cost and risk of Lessee and Lessor shall not be liable for
damage, theft, misappropriation or loss thereof and Lessor shall not be liable in any manner in respect thereto. Lessee shall pay all costs and expenses of such remoyal, transportation and storage.
Lessee shall leave the Premises in good order, condition and repair, reasonable wear and tear and
uninsured damage from fire and other casualty excepted. Lessee shall reimburse Lessor upon demand for any expenses incurred by Lessor with respect to removal, transportation, or storage of abandoned
property and with respect to restoring said Premises to good order, condition and repair. All alterations, additions and fixtures, other than Lessee's trade fixtures and equipment, which have been
made or installed by either Lessor or Lessee upon the Premises, shall remain the property of Lessor and shall be surrendered with the Premises as a part thereof If the Premises be not surrendered at
the end of the term or sooner termination thereof, Lessee shall indemnify Lessor against loss or liability resulting from delay by Lessee in so surrendering the Premises, including, without
limitation, claims made by any succeeding tenants founded on such delay and any attorneys' fees resulting therefrom. Lessee shall promptly surrender all keys for the Premises to Lessor at the place
then fixed for the payment of rent and shall inform Lessor of combinations on any vaults, locks and safes left on the Premises.
In
the event Lessee remains in possession of the Premises after expiration of this Lease, and without the execution of a new lease, but with Lessor's written consent, it shall be
deemed to be occupying the Premises as a tenant from month-to-month, subject to all the provisions, conditions and obligations of this Lease insofar as the same can be
applicable to a month-tomonth tenancy, except that the Base Rent shall be escalated to Lessor's then current base rent for the Premises according to Lessor's then current rental rate schedule for
prospective tenants. In the event Lessee remains in possession of the Premises after expiration of this Lease and without the execution of a new lease and without Lessor's written consent, Lessee
shall be deemed to be occupying the Premises without claim of right and Lessee shall pay Lessor for all costs arising out of loss or liability resulting from delay by Lessee in so surrendering the
Premises as above provided and shall pay a charge for each day of occupancy an amount equal to double the Base Rent and Additional Rent (on a daily basis) then currently being charged by Lessor on new
leases in the Office/Warehouse Complex for space similar to the Premises.
ARTICLE XV. DEFAULT OF LESSEE: All rights and remedies of Lessor herein enumerated shall be cumulative and are
not intended to be exclusive of any other remedies or means of redress to which Lessor may be lawfully entitled in case of any breach or threatened breach of Lessee of any provision of this Lease. The
failure of Lessor to insist in any one or more cases upon the strict performance of any of the covenants of this Lease or to exercise any option herein contained shall not be construed as a waiver or
relinquishment for the future of such covenant or option. A receipt by Lessor of rent with knowledge of the breach of any covenant hereof (other than breach of the obligation to pay the portion of
such rent paid) shall not be deemed a waiver of such breach, and no waiver by Lessor of any provisions of this Lease shall be deemed to have been made unless expressed in writing and signed by Lessor.
In addition to other remedies in this Lease provided, Lessor shall be entitled to the restraint by injunction of the violation or attempted or threatened violation of the covenants, conditions and
provisions of this Lease.
Subject
to laws relating to bankruptcy, if, during the term of this Lease or any renewal term, (i) Lessee shall make an assignment for the benefit of creditors, or
(ii) a voluntary petition be filed by Lessee under any law having for its purpose the adjudication of Lessee a bankrupt, or Lessee be adjudged a bankrupt pursuant to an involuntary petition in
bankruptcy, or (iii) a receiver be appointed for the property of Lessee by reason of the insolvency of Lessee, or (iv) any department of the State or Federal government, or any officer
thereof, duly authorized, shall take possession of the business or property of
Lessee by reason of the insolvency of Lessee, the occurrence of any of such contingencies shall be deemed a breach of this Lease and this Lease shall ipso facto upon the happening of any of said
contingencies be terminated and the same shall expire as fully and completely as if the day fixed for the expiration of the initial term of this Lease or any renewal term. as the case may be, had
occurred, and Lessee will then quit and surrender the Premises, but Lessee shall remain liable as
hereinafter provided. As used in this paragraph, the term "Lessee" shall also mean any guarantor of Lessee's obligations under this Lease.
If,
during the initial term of this Lease or any renewal term, (i) Lessee shall default in fulfilling any of the covenants, obligations, or agreements of this Lease (other than
the covenants for the payment of rent payable by Lessee hereunder), or (ii) this Lease, without the prior written consent of Lessor or except as expressly permitted, shall be assigned, pledged,
mortgaged, transferred, or sublet in any manner, Lessor may give Lessee notice of such default or the happening of any contingency in this paragraph referred to and, if at the expiration of thirty
(30) days after service of such notice the default or contingency upon which said notice was based shall continue to exist, or in the event of a default or contingency which cannot with due
diligence be cured within a period of thirty (30) days, if Lessee fails to proceed promptly after the service of said notice and with all due diligence to commence to cure the same and
thereafter to prosecute the curing of such default with all due diligence (it being intended that in connection with a default not susceptible of being cured with diligence within thirty
[30] days, the time within which Lessee is to cure the same shall be extended for such period as may be necessary to complete the same with all due diligence), Lessor, at its
option, may terminate this Lease and upon such termination Lessee will quit and surrender the Premises to Lessor but Lessee shall remain liable as hereinafter provided.
If
Lessee defaults in any payment of the rent expressly reserved hereunder, or any part of the same and such default shall continue for ten (10) days after written notice
thereof by Lessor, or if Lessee shall make default in the payment of any item or any charge required to be paid by Lessee hereunder, or any part of the same and such default shall continue for ten
(10) days after written notice thereof by Lessor, Lessor or Lessor's agent or servant may immediately or at any time thereafter terminate this Lease, and upon such termination for failure to
pay such rent, item, or charge, or if this Lease shall terminate by reason of the insolvency of Lessee, as set forth above, Lessor or Lessor's agent or servant may re-enter the Premises
and remove all persons and all or any property therefrom, either by summary dispossess proceedings, or by any suitable action or proceeding at law or by force or otherwise, without being liable to
indictment, prosecution, or damage therefor and repossess and enjoy the Premises, together with all additions, alterations and improvements, without such re-entry and repossession working
a forfeiture or waiver of the rents to be paid and the covenants to be performed by Lessee during the full term of this Lease. Upon termination of this Lease or expiration of Lessee's right to occupy
the Premises by reason of the happening of any of the foregoing events, or in any other manner or circumstances whatsoever, whether with or without legal proceedings, by reason of or based upon or
arising out of a default or breach of this Lease on the part of Lessee, Lessor may. at its option, at any time and from time to time relet the Premises or any part or parts thereof, for the account of
Lessee or otherwise, and receive and collect the rent therefor, applying the same first to the payment of such expenses as Lessor may have incurred in recovering possession of the Premises, including
attorney's fees and expenses for putting the same into good order and condition or preparing or altering the same for re-rental to the extent Lessor deems necessary or desirable and all
other expenses, commissions and charges paid, assumed or incurred by Lessor in or about reletting the Premises and then to the fulfillment of the covenants of Lessee hereunder. Any such reletting
herein provided for may be for the remainder of the initial term or any exercised renewal term of this Lease, as originally granted, or for a longer or shorter period; Lessor shall have the right to
change the character and use made of the Premises, and Lessor shall not be required to accept any substitute tenant offered by Lessee or to
observe any instructions given by Lessee about reletting. In any such case, and whether or not the Premises or any part thereof be relet, Lessee shall pay to Lessor the Base Rent and all Additional
Rent and other charges required to be paid by Lessee up to the later of the time of such termination of the Lease or of such recovery of possession of the Premises by Lessor, as the case may be, and
thereafter, except in a case in which liability of Lessee as hereinafter provided, arises by reason of the happening of the insolvency of Lessee, Lessee covenants and agrees, if required by Lessor, to
pay to Lessor (monthly) until the end of the term of this Lease, including any exercised
renewal term, the equivalent of the amount of all rent reserved hereunder, and all other charges required to be paid by Lessee, less the net proceeds of reletting, if any. Lessor shall have the
election at any time in place of and instead of holding Lessee so liable for subsequent periods forthwith to recover against Lessee as damages for loss of the bargain and not as a penalty, an
aggregate sum which at such time represents the then present worth of the excess, if any, of the aggregate of the rent and all other charges payable by Lessee hereunder that would have accrued for the
balance of the term, including any exercised renewal term, over the then present worth of the fair market rents and all other charges (less the costs of anticipated leasing commissions and tenant
improvements) for the Premises for the balance of such term.
If
this Lease shall terminate by reason of the bankruptcy or insolvency of Lessee, as above set forth, Lessor shall be entitled, notwithstanding any other provisions of this Lease or
any present or future law, to recover from Lessee or Lessee's estate (in lieu of the equivalent of the amount of all rent unpaid at the time of such termination) as damages for loss of the bargain,
and not as a penalty, an aggregate sum which, at the time of such termination of this Lease, represents the excess, if any, of the then present worth of the aggregate of the rent and other charges
payable by Lessee hereunder that would have accrued for the balance of the term including any exercised renewal term, over the then present worth of the fair market rents and all other charges for the
Premises for the balance of the term including any exercised renewal term, unless any statute or rule of law governing the proceedings in which such damages are to be proved shall limit the amount of
such claim capable of being so proved. In such case, Lessor shall be entitled to prove, as and for liquidated damages, by reason of such breach and termination of this Lease, the maximum amount which
may be allowed by or under such statute or rule of law. Nothing herein contained shall limit or prejudice Lessor's right to prove and obtain as liquidated damages arising out of such breach or
termination the maximum amount allowed by any such statute or rule of law which may govern the proceedings in which such damages are to be proved whether or not such amount be greater, equal to, or
less than the amount of the excess of the then present worth of the rent and all other charges reserved herein over the then present worth of the fair market rents and all other charges referred to
above.
Lessee
shall pay, upon demand, all of Lessor's costs, charges and expenses, including reasonable attorney's fees and fees of agents and others retained by Lessor, incident to the
enforcement of Lessee's obligations hereunder or incurred by Lessor in any litigation, negotiation or transaction in which Lessee causes Lessor without Lessor's fault to become involved or concerned,
including a fee of Ten and 00/100 Dollars ($10.00) for any default notice given by Lessor to Lessee.
ARTICLE XVI. SUBORDINATION: This Lease shall be subject and subordinate to any mortgage, deed of trust or ground
lease now or hereafter placed upon the Premises, the Office/Warehouse Complex, the Property, or any portion thereof by Lessor, its successors or assigns, and to amendments, replacements, renewals and
extensions thereof Lessee agrees at any time hereafter, upon demand, to execute and deliver any instruments, releases, or other documents that may be reasonably required for the purpose of subjecting
and subordinating this Lease. as above provided, to the lien of any such mortgage, deed of trust or ground lease. It is agreed, nevertheless, that as long as Lessee is not in
default in the payment of Base Rent, Additional Rent, and the payment of other charges to be paid by Lessee under this Lease, and the performance of all covenants, agreements and conditions to be
performed by Lessee under this Lease, then neither Lessee's right to quiet enjoyment under this Lease, nor the right of Lessee to continue to occupy the Premises and to conduct its business thereon,
in accordance with the terms of this Lease as against any lessor, lessee, mortgagee, trustee, or their successors or assigns shall be interfered with.
The
above subordination shall be effective without the necessity of the execution and delivery of any further instruments on the part of Lessee to effectuate such subordination.
Notwithstanding anything hereinabove contained in this Article XVI, in the event the holder of any mortgage, deed of trust or ground lease shall at any time elect to have this Lease constitute
a prior and superior lien to
its mortgage, deed of trust or ground lease, then, and in such event, upon any such holder or landlord notifying Lessee to that effect in writing, this Lease shall be deemed prior and superior in lien
to such mortgage, deed of trust, or ground lease, whether this Lease is dated prior to or subsequent to the date of such mortgage, deed of trust or ground lease and Lessee shall execute such
attornment agreement as may be reasonably requested by said holder.
Lessee
agrees, provided the mortgagee, ground lessor or trust deed holder under any mortgage, ground lease, deed of trust or other security instrument shall have notified Lessee in
writing (by way of a notice of assignment of lease or otherwise) of its address, Lessee shall give such mortgagee, ground lessor or trust deed holder, or other secured party ("Mortgagee")
simultaneously with delivery of notice to Lessor, by registered or certified mail, a copy of any such notice of default served upon Lessor. Lessee further agrees that said Mortgagee shall have the
right to cure any alleged default during the same period that Lessor has to cure such default.
ARTICLE XVII. MISCELLANEOUS:
A.Lessee
represents that Lessee has dealt directly with and only with Welsh Companies, acting through ▇▇▇▇ ▇▇▇▇▇▇▇, and ▇▇▇▇, acting through ▇▇▇ ▇▇▇▇▇, as brokers, in connection with
this Lease and that insofar as Lessee knows, no other broker negotiated or participated in negotiations of this Lease or submitted or showed the Premises or is entitled to any commission in connection
therewith.
B.Lessee
agrees from time to time upon not less than ten (10) days prior written request by Lessor to deliver to Lessor a statement in writing certifying (i) this Lease
is unmodified and in full force and effect (or if there have been modifications that the Lease as modified is in full force and effect and stating the modifications); (ii) the date to which the
rent and other charges have been paid; (iii) Lessor is not in default in any provision of this Lease or, if in default, the nature thereof specified in detail; (iv) the amount of monthly
rental currently payable by Lessee; (v) the amount of any prepaid rent, and (vi) such other matters as may be reasonably requested by Lessor or any Mortgagee or prospective purchaser of
the Office/Warehouse Complex.
C.All
notices, demands and requests shall be in writing, and shall be effectively served in any of the following manners:
(i)If
addressed to Lessee:
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| By forwarding such notice, demand or request by certified or registered mail, postage prepaid, addressed to Lessee at:
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Fargo Electronics, Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇. Upin
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or at such other address as Lessee may hereafter designate by written notice to Lessor, in which case said notice shall be effective at the time of mailing such notice.
(ii)If
addressed to Lessor:
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| By forwarding such notice, demand or request by certified or registered mail, postage prepaid, addressed to Lessor at:
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Opus Northwest, L.L.C.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Law Department
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or at such other address as Lessor may hereafter designate by written notice to Lessee, in which case said notice shall be effective at the time of mailing such notice.
D.All
rights and remedies of Lessor under this Lease or that may be provided by law may be executed by Lessor in its own name, individually, or in the name of its agent, and all legal
proceedings for the enforcement of any such rights or remedies, including those set forth in Article XV, may be commenced and prosecuted to final judgment and execution by Lessor in its own
name or in the name of its agent.
▇.▇▇▇▇▇▇
covenants and agrees that Lessee, upon paying the Base Rent, Additional Rent and other charges herein provided for and observing and keeping the covenants, agreements and
conditions of this Lease on its part to be kept and performed, shall lawfully and quietly hold, occupy and enjoy the Premises during the term of this Lease.
F.The
covenants and agreements herein contained shall bind and inure to the benefit of Lessor, its successors and assigns, and Lessee and its permitted successors and assigns.
G.If
any term or provision of this Lease shall to any extent be held invalid or unenforceable, the remaining terms and provisions of this Lease shall not be affected thereby, but each
term and provision of this Lease shall be valid and enforced to the fullest extent permitted by law. This Lease shall be construed and enforced in accordance with the laws of the state in which the
Premises are located.
H.Lessee
covenants not to do or suffer any waste or damage or disfigurement or injury to the Premises or Office/Warehouse Complex and Lessee further covenants that it will not abandon
the Premises during the term of this Lease.
I.The
term "Lessor" as used in this Lease so far as covenants or obligations on the part of Lessor are concerned shall be limited to mean and include only the owner or owners of the
Office/Warehouse Complex at the time in question, and in the event of any transfer or transfers or conveyances the then grantor shall be automatically freed and released from all personal liability
accruing from and after the date of such transfer or conveyance as respects the performance of any covenant or obligation on the part of Lessor contained in this Lease to be performed, it being
intended hereby that the covenants
and obligations contained in this Lease on the part of Lessor shall be binding on Lessor, its successors and assigns, only during and in respect to their respective successive periods of ownership.
In
the event of a sale or conveyance by Lessor of the Office/Warehouse Complex or any part of the Office/Warehouse Complex, the same shall operate to release Lessor from any future
liability upon any of the covenants or conditions herein contained and in such event Lessee agrees to look solely to the responsibility of the successor in interest of Lessor in and to this Lease.
This Lease shall not be affected by any such sale or conveyance, and Lessee agrees to attorn to the purchaser or grantee, which shall be personally obligated on this Lease only so long as it is the
owner of Lessor's interest in and to this Lease.
J.The
marginal or topical headings of the several Articles are for convenience only and do not define, limit or construe the contents of said Articles.
K.All
preliminary negotiations are merged into and incorporated in this Lease.
L.This
Lease can only be modified or amended by an agreement in writing signed by the parties hereto. No receipt of money by Lessor from Lessee or any other person after termination
of this Lease or after the service of any notice or after the commencement of any suit, or after final judgment for possession of the Premises shall reinstate, continue or extend the term of this
Lease or affect any such notice, demand or suit, or imply consent for any action for which Lessor's consent is required, unless specifically agreed to in writing by Lessor. Any amounts received by
Lessor may be allocated to any specific amounts due from Lessee to Lessor as Lessor determines.
▇.▇▇▇▇▇▇
shall have the right to close any portion of the building area or land area to the extent as may, in Lessor's reasonable opinion, be necessary to prevent a dedication thereof
or the accrual of any rights to any person or the public therein. Lessor shall at all times have full control, management and direction of the Office/Warehouse Complex, subject to the rights of Lessee
in the Premises, and Lessor reserves the right at any time and from time to time to reduce, increase, enclose or otherwise change the size, number and location of buildings, layout and nature of the
Office/Warehouse Complex and the other tenancies, premises and buildings included in the Office/Warehouse Complex, to construct additional buildings and additions to any building, and to create
additional rentable areas through use and/or enclosure of common areas, or otherwise, and to place signs on the Office/Warehouse Complex, and to change the name, address, number or designation by
which the Office/Warehouse Complex is commonly known. No implied easements are granted by this Lease. Lessor shall in no event be liable for any lack of security in respect to the Office/Warehouse
Complex.
N.Lessee
shall permit Lessor (or its designees) to erect, use, maintain, replace and repair pipes, cables, conduits, plumbing, vents, and telephone, electric and other wires or other
items, in, to and through the Premises, as and to the extent that Lessor may now or hereafter deem necessary or appropriate for the proper operation and maintenance of the Office/Warehouse Complex.
O.Employees
or agents of Lessor have no authority to make or agree to make a lease or other agreement or undertaking in connection herewith. The submission of this document for
examination does not constitute an offer to lease, or a reservation of, or option for, the Premises. This document becomes effective and binding only upon the execution and delivery hereof by the
proper officers of Lessor and by Lessee. Lessee confirms that Lessor and its agents have made no representations or promises with respect to the Premises or the making of or entry into this Lease
except as in this Lease expressly set forth, and agrees that no claim or liability shall be asserted by Lessee against Lessor for, and Lessor shall not be liable by reason of, breach of any
representations or promises not expressly
stated in this Lease. This Lease, except for the Building Rules and Regulations, in respect to which subparagraph P of this Article shall prevail, can be modified or altered only by agreement in
writing between Lessor and Lessee, and no act or omission of any employee or agent of Lessor shall alter, change or modify any of the provisions hereof.
P.Lessee
shall perform, observe and comply with the Building Rules and Regulations of the Office/ Warehouse Complex attached hereto as Exhibit B and made a part hereof, with
respect to the safety, care and cleanliness of the Premises and the Office/Warehouse Complex, and the preservation of good order thereon, and, upon written notice thereof to Lessee, Lessee shall
perform, observe, and comply with any reasonable changes, amendments or additions thereto as from time to time shall be established and deemed advisable by Lessor for tenants of the Office/Warehouse
Complex. Lessor shall not be liable to Lessee for any failure of any other tenant or tenants of the Office/Warehouse Complex to comply with such Building Rules and Regulations;
provided, however, Lessor shall use reasonable effort to enforce such rules. In no event shall Lessor be required to bring any action against such other tenant or terminate any lease.
Q.All
rights and occupancy of Lessee herein shall be subject to all governmental laws, ordinances and regulations, and Lessee shall comply with the same.
R.All
obligations of Lessee hereunder not fully performed as of the expiration or earlier termination of the term of this Lease shall survive the expiration or earlier termination of
the term hereof, including, without limitation, all payment obligations with respect to Operating Expenses and Real Estate Taxes and all obligations concerning the condition of the Premises.
S.Lessee
agrees to look solely to Lessor's interest in the Office/Warehouse Complex for the recovery of any judgment from Lessor, it being agreed that Lessor, or if Lessor is a
partnership, its partners whether general or limited, or if Landlord is a corporation, its directors, officers or shareholders, shall never be personally liable for any such judgment.
T.Lessee
shall furnish to Lessor promptly upon demand, a corporate resolution, proof of due authorization of partners, or other appropriate documentation reasonably requested by
Lessor evidencing the due authorization of Lessee to enter into this Lease.
U.This
Lease shall not be deemed or construed to create or establish any relationship or partnership or joint venture or similar relationship or arrangement between Lessor and Lessee
hereunder.
ARTICLE XVIII. MISCELLANEOUS TAXES: Lessee shall pay, prior to delinquency, all taxes assessed or levied upon
its occupancy of the Premises, or upon the trade fixtures, furnishings, equipment and all other personal property of Lessee located in the Premises, and when possible, Lessee shall cause such trade
fixtures, furnishings, equipment and other personal property to be assessed and billed separately from the property of Lessor. In the event any or all of Lessee's trade fixtures, furnishings,
equipment or other personal property, or Lessee's occupancy of the Premises, shall be assessed and taxed with the property of Lessor, Lessee shall pay to Lessor its share of such taxes within ten
(10) days after delivery to Lessee by Lessor of a statement in writing setting forth the amount of such taxes applicable to Lessee's personal property. Lessee shall have the right to contest
such taxes so long as Lessor is not put at any risk of loss in respect thereto. Lessee shall, if required to avoid risk to Lessor, pay such taxes under protest or provide to Lessor security against
loss reasonably acceptable to Lessor.
ARTICLE XIX. OTHER PROVISIONS: The following are made a part hereof, with the same force and effect as if
specifically set forth herein:
| 1.
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| Floor Plan—Exhibit A.
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| 2.
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| Building Rules and Regulations—Exhibit B.
|
| 3.
|
| Rider to Lease—Exhibit C. The provisions of this Rider shall control over any conflicting provisions of this Lease, but such Rider shall be read to the extent reasonable in a manner consistent with the
provisions of this Lease.
|
| 4.
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| Tenant Improvement Outline Specifications—Exhibit D.
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| 5.
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| Tenant Improvement Outline Plans—Exhibit E.
|
| 6.
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| Tenant Sign Criteria—Exhibit F.
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| 7.
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| Expansion Space Outline Specifications—Exhibit G.
|
| 8.
|
| Exclusive Parking Spaces for Lessee—Exhibit H.
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| 9.
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| Supervalu/Planmark Exclusive Parking—Exhibit I.
IN WITNESS WHEREOF, the parties have executed this Lease as of the day and year first above written.
| OPUS NORTHWEST, L.L.C.
|
| FARGO ELECTRONICS, INC.
|
| (LESSOR)
|
| (LESSEE)
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|
By /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
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By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
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Its President
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Its President
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[Omitted—Exhibit A—drawing of leased premises]
EXHIBIT B
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 of the Office/Warehouse 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 notwithstanding, 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 Office/Warehouse Complex. No curtains, blinds, shades or screens visible from the
exterior of the Office/Warehouse Complex or visible from the exterior of the Premises, shall be attached to or hung in, or used in connection with any window or door of the Premises without the prior
written consent of Lessor. 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 servants, employees, customers, invitees and guests shall not obstruct sidewalks, entrances, passages, corridors, vestibules, halls, or stairways in and
about the Office/Warehouse Complex which are used in common with other tenants and their servants, 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 Office/Warehouse Complex corridors or from the exterior of the Office/Warehouse 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 occupants of the Office/ Warehouse Complex, or that would interfere with the operation of any
device, equipment, radio, television broadcasting or reception from or within the Office/Warehouse Complex or elsewhere and shall not place or install any projections, antennas, aerials or similar
devices inside or outside of the Premises or on the Office/Warehouse Complex.
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