EXHIBIT 10.8
LEASE AGREEMENT
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THIS LEASE is made this 15th day of June, 1993, by and between FLENINGE
PARTNERSHIP, a Minnesota general partnership (hereinafter "Landlord"), and
EMPAK, INC., a Minnesota corporation (hereinafter "Tenant").
Landlord and Tenant, intending to be legally bound, hereby covenant and
agree as follows:
ARTICLE 1.
LEASED PREMISES
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Landlord does hereby lease, demise and let unto Tenant, and Tenant does
hereby hire and take from Landlord, upon the terms and conditions set forth
herein (the Lease) that certain parcel of real property situated in the City of
Chanhassen, County of ▇▇▇▇▇▇, State of Minnesota, legally described as follows:
▇▇▇ ▇▇▇, ▇▇▇▇▇ ▇▇▇ ▇▇▇ ▇▇▇ ▇▇▇, ▇▇▇▇▇ 005, Chanhassen Lakes Business Park
(the Land), subject to all easements and rights-of-way of record, together with
all structures thereon and all appurtenances thereto (the Improvements), all of
which Land and Improvements are hereinafter referred to as the "Leased
Premises."
ARTICLE 2.
TERM
----
The term of this lease shall commence the 1st day of September, 1993, and
shall terminate the 31st day of August, 2001, unless sooner terminated as
provided herein.
ARTICLE 3.
RENT
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Tenant shall pay to Landlord as the annual "Base Rent" the sum of Three and
80/100 Dollars ($3.80) per square foot based on the total usable square footage
of the Leased Premises which is determined to be Sixty Thousand (60,000) square
feet, for a total annual rental rate of Two Hundred Twenty-Eight Thousand and
No/100 Dollars ($228,000.00) per year and Nineteen Thousand and No/100 Dollars
($19,000.00) per month. Effective January 1, 1994, and the first day of every
third (3rd) January thereafter during the term of this lease, the Base Rent
shall be increased by an amount equal to eighty percent (80%) the increase in
the Consumer Price Index -United States City Average, All Urban Consumers, as
published by the Bureau of Labor Statistics, based upon the 1982/1984 base index
for (i) the preceding 12-month period with respect to the increase on January 1,
1994; and (ii) the preceding 36-month period for all subsequent rent increases.
The Base Rent shall be payable in equal monthly installments and shall be
payable in advance on or before the first (1st) day of each and every month.
ARTICLE 4.
NET LEASE
---------
4.1) It is the intention and purpose of the parties hereto that the
Lease shall be a "Net Lease" to Landlord. All costs and expenses of
whatever character or kind, general and special, ordinary and
extraordinary, foreseeable or unforeseeable, and of every kind and nature
whatsoever that may be necessary in or about the operation of the Leased
Premises, including all hazard and liability insurance, taxes, special
assessments, utilities, maintenance and repairs, except as otherwise
expressly provided herein, shall be paid by Tenant as "Additional Rent"
hereunder.
4.2) Except as otherwise expressly provided herein, Tenant covenants
and agrees that if at any time it fails to pay any amount required by the
Lease, or to obtain, pay for, maintain or deliver any of the insurance
policies herein provided for, or fails to make any other payment or perform
any other act required to be made or performed by the Lease, then Landlord,
without notice to or demand upon Tenant, without waiving or releasing
Tenant from any obligation of Tenant contained in the Lease, and without
any obligation to do so, may effect any such insurance coverage and pay
premiums therefor and may make any other payment or perform any other act
on the part of Tenant to be made and performed as provided in the Lease and
in exercising such right to pay necessary and incidental costs and
expenses. All sums so paid by Landlord and all necessary and incidental
costs and expenses in connection with performance of any such act by
Landlord, together with interest thereon at a rate of eighteen percent
(18%) per annum from the date of making of such expenditure by Landlord,
shall be payable to Landlord as Additional Rent, and except as otherwise
provided for in the Lease, shall be payable on demand or at the option of
Landlord may be added to any monthly rental then due or thereafter becoming
due under the Lease. Tenant covenants to pay any such sum or sums with
interest as aforesaid and Landlord shall have (in addition to any right or
remedy of Landlord) the same rights and remedies in the event of nonpayment
by Tenant as in the case of default by Tenant in payment of rent.
ARTICLE 5.
TAXES AND ASSESSMENTS
---------------------
5.1) Tenant, in addition to the Base Rent and Additional Rent provided
for herein, shall pay to the public authorities charged with collection
thereof, promptly as the same may be due and payable, all real property
taxes, installments of special assessments and improvements (Impositions)
which are due and payable during tho term of this lease. Impositions
payable in the first and last calendar year of the lease term shall be
equitably prorated based upon the portion of the year included in the lease
term. If Tenant shall default in the payment of any Imposition required to
be herein, Landlord shall have the right to pay the same, together with any
penalties and/or interest, in which event the amount so paid by Landlord
shall be paid by Tenant to Landlord on demand, together with interest
thereon at a rate of
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Eighteen Percent (18%) per annum from the date making such expenditure by
Landlord. Tenant shall pay all personal property and similar taxes on its
property in the Leased Premises.
5.2) Tenant shall have the right to contest or appeal any imposition
in Tenant's or Landlord's name, at Tenant's sole cost and expense. If
nonpayment of the Imposition creates a lien upon the Leased Premises,
Landlord may, at its option, request Tenant to deposit with it an amount
equal to one hundred ten percent (110%) of the contested and unpaid
Imposition. Such amount shall be returned to Tenant upon the successful
appeal of the Imposition or upon payment of it. Tenant shall give Landlord
written notice of Tenant's intention to contest or appeal any Imposition at
least twenty (20) days prior to the delinquency thereof. Tenant shall hold
Landlord harmless against all loss, cost, expense, attorneys' fees or
damages resulting from such contest or appeal.
5.3) Tenant shall pay directly to the appropriate governmental
authorities, as Additional Rent hereunder, before any fine, penalty,
interest or costs may be added thereto for the nonpayment thereof, any tax
or excise imposed or assessed on rent, on any leasehold interest, any right
of occupancy, any investment of Tenant in the Leased Premises, any personal
property of any kind owned, installed or used by Tenant, including Tenant's
leasehold improvements, any privilege tax, sales tax, gross proceeds tax,
etc., however described, by any federal, state, county or municipal
governmental authority or any subdivision thereof or other governmental
authority.
ARTICLE 6.
UTILITIES
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Tenant shall directly pay or cause to be paid, as Additional Rent
hereunder, all charges for sewer and water services, gas, electricity, light,
heat, air conditioning, power, telephone or other services or utility used,
rendered or supplied upon or in connection with the Leased Premises (the
Utilities) during the Term hereof. Tenant shall contract for the Utilities in
Tenant's own name and shall hold Landlord harmless from any liability or expense
for any such charge. Upon Landlord's request, Tenant shall furnish to Landlord
paid statements, invoices or cancelled checks evidencing the payment of all
obligations undertaken by Tenant hereunder.
ARTICLE 7.
REPAIRS, MAINTENANCE AND ALTERATIONS
------------------------------------
7.1) Tenant shall, during the Term of the Lease and at Tenant's
expense, keep the leased Premises and appurtenances and every part thereof
in good order, condition and repair, including, without limitation, all
Improvements (including foundations, walls and roof) the sidewalks,
entrances, passages, courts, vestibules, stairways, corridors, halls,
elevators, air conditioning equipment, heating equipment, water system,
toilet facilities and all other machinery and equipment in the
Improvements. Tenant shall make all repairs to the exterior of the
Improvements and shall keep and maintain all landscaped areas in a neat,
orderly and trim condition at its expense. If Tenant does not keep and
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maintain the Leased premises as herein provided, Landlord may, but shall
not be obligated to, make such repairs and replacements, and Tenant shall
pay Landlord, as Additional Rent, the cost thereof forthwith upon being
billed for the same. All damage or injury to the Leased premises and to its
fixtures, appurtenances, and equipment caused by Tenant moving property in
or out of the Leased Premises or by installation, removal of furniture,
fixtures, equipment or other property by Tenant, its agents, contractors,
servants or employees, or resulting from any other cause of any other kind
or nature whatsoever due to carelessness, omission, neglect, improper
conduct or other causes of Tenant, its servants, employees, agents,
visitors or licensees, shall be repaired, restored or replaced promptly by
Tenant at its sole cost and expense to the satisfaction of Landlord. If
Tenant fails to make such repairs, restorations or replacements, the same
may be made by Landlord and the same shall be at the expense of Tenant and
collectible as Additional Rent or otherwise, and shall be paid by Tenant to
Landlord within five (5) days after rendition of a ▇▇▇▇ or statement
therefor.
7.2) Except as otherwise provided herein, no improvements, alterations
or replacements shall be made to the Leased Premises or any portion thereof
without the prior written consent of Landlord.
7.3) Tenant shall not suffer or permit any statements of mechanic's
liens to be filed against the Leased Premises or any part thereof by reason
of work, labor, services or materials supplied or claimed to have been
supplied to Tenant or anyone holding the Leased Premises or any part
thereof through or under Tenant. If any such statement of mechanic's lien
shall at any time be filed against the Leased Premises, Tenant shall cause
the same to be discharged of record within sixty (60) days after the date
of actual notice to Tenant of filing the same. If Tenant shall fail to
discharge such mechanic's lien within such period or fail to deposit an
amount equal to one hundred ten percent (110%) of the amount claimed with
the court within such period, then in addition to any other right or remedy
of Landlord, Landlord may, but shall not be obligated to, discharge the
same either by paying the amount claimed to be due or by procuring the
discharge of such lien by deposit in court or by giving security or in such
other manner as is, or may be, prescribed by law. Any amount paid by
Landlord for any of the aforesaid purposes, and all reasonable other
expenses of Landlord, including reasonable attorneys' fees, in or about
procuring the discharge of such lien, with all necessary disbursements in
connection therewith, with interest thereon at the rate of eight percent
(8%) per annum from the date of payment, shall be repaid by Tenant to
Landlord on demand, and if unpaid may be treated as Additional Rent.
Nothing herein contained shall imply any consent or agreement on the part
of Landlord to subject Landlord's estate to liability under any mechanic's
lien law.
ARTICLE 8.
INSURANCE
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8.1) Tenant shall, as Additional Rent hereunder and at Tenant's sole
cost and expense, keep the Leased Promises, including all buildings,
improvements, furniture and equipment on, in or appurtenant thereto at the
commencement of the Term and thereafter erected thereon or therein,
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including all alterations, rebuildings, replacements, changes, additions
and improvements, fully insured for the mutual benefit of Landlord and
Tenant, as their interests may appear, as named insureds (a) against lost
or damage by fire and (b) against those perils included from time to time
in the standard form of extended coverage insurance endorsement, including
but without limiting the generality at the foregoing, wind storm, hail,
explosion, vandalism, riot and civil commotion, damage from vehicles, and
smoke damage.
8.2) All policies of insurance relating to fire and extended coverage
shall provide that the proceeds thereof shall be payable to Landlord, and
if Landlord requires, shall also be payable to the holder of any mortgage
now or hereafter becoming a lien on the fee of the Leased Premises, or any
part thereof, as the interest of such holder appears, pursuant to a
standard mortgagee clause. All such policies of insurance shall provide
that any loss shall be payable to Landlord notwithstanding any act or
omission of Tenant which might otherwise result in a forfeiture or
reduction of said insurance.
8.3) Tenant shall also, as Additional Rent hereunder and at Tenant's
sole cost and expense, but for the mutual benefit of Landlord and Tenant,
as named insureds, maintain during the Term of the Lease (a) general public
liability insurance against claims for personal injury, death or property
damage occurring upon, in or about the Leased Premises, and on, in or about
the adjoining lands, streets and passageways, such insurance to afford
protection to the limit of not less than One Million and no/100 Dollars
($1,000,000.00) in respect to injury or death to a single person, and to
the limit of not less than Two Million and no/100 Dollars ($2,000,000.00)
in respect to any one (1) accident and to the limit of not less than Five
Hundred Thousand and no/100 Dollars ($500,000.00) in respect to any
property damage; (b) steam boiler insurance on all steam boilers, pressure
boilers or other such apparatus as Landlord may deem necessary to be
covered by such insurance and in such amount or amounts as Landlord may
from time to time reasonably require.
8.4) All policies of insurance shall be written by companies
satisfactory to Landlord, and shall be written in such form and shall be
distributed in such companies as shall be reasonably acceptable to
landlord. Such policies shall be delivered to Landlord endorsed `premium
paid' by the company or agency issuing the same or accompanied by other
evidence satisfactory to Landlord that the premiums thereon have been paid,
not less than ten (10) days prior to the expiration of any then current
policy.
8.5) Landlord agrees that such policy or policies may contain a waiver
of subrogation clause as to Tenant. Provided the aforesaid fire and
extended coverage insurance is in full force and effect and remains so,
Landlord waives, releases and discharges Tenant from all claims or demands
whatsoever which Landlord may have or acquire in the future arising out of
damage to or destruction of the Leased Premises by fire or extended
coverage risk, whether such claim or demand may arise because of the
negligence of Tenant, its agents or employees or otherwise, and Landlord
agrees to look only to the insurance coverage in the event of such loss.
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8.6) Tenant shall insure the contents of the Improvements owned by
Tenant, for the benefit of Tenant, against loss or damage by fire,
windstorm, or other casualty for such amount as Tenant may desire, and
Tenant agrees that such policies shall contain a waiver of subrogation
clause as to Landlord. Tenant waives, releases and discharges Landlord from
all claims or demands whatsoever which Tenant may have or acquire by fire
or extended coverage risk, whether such claim or demand may arise because
of the negligence of Landlord, its agents or employees or otherwise, and
Tenant agrees to look to insurance coverage only in the event of such loss.
ARTICLE 9.
QUIET ENJOYMENT
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Landlord represents and warrants that it is the lawful owner of the Leased
Premises; that it has the full right and power to make the Lease; that if and so
long as Tenant shall not be in default hereunder, Tenant shall quietly hold,
occupy and enjoy the Leased Premises during all of the Term of the Lease.
ARTICLE 10.
DESTRUCTION BY FIRE
-------------------
10.1) Subject to the provisions of Article 10.4, if the Improvements,
or any portion thereof, are damaged or destroyed by fire or other casualty,
however or by whomever caused, Landlord shall repair, rebuild and restore
the same with due diligence and dispatch (subject to the approval of the
holders of any mortgages on the Property) so that the Improvements will be
restored to at least the same good order and condition as existed prior to
damage or destruction. If more than twenty-five percent (25%) of the Leased
Premises is damaged or destroyed by fire or other casualty, Landlord shall
have the option, in its sole discretion, to decline to rebuild the Leased
Premises. If Landlord so declines, this Lease shall terminate as of the
date of such damage or destruction. If such damage renders only part of the
Leased Premises unfit for Tenant's normal business purposes, Base Rent and
any additional rent shall remain unabated.
10.2) Tenant will repair and replace all improvements and betterments
placed upon the Leased Premises by it, and such repair and replacement
shall be made at its own expense and not at the expense of Landlord.
10.3) If Landlord and Tenant cannot mutually agree on whether the
Leased Premises is fit for Tenant's normal business purposes, such question
shall be submitted to arbitration as provided in Article 12 hereof.
10.4) If the Leased Premises, or any part thereof, is damaged or
destroyed by the willful or negligent conduct of Tenant or its agents,
employees or independent contractors, Tenant shall promptly repair such
damage or replace such improvement so destroyed; provided that if such
damage or
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destruction is caused by negligence and is or would be covered by the
insurance required to be procured and maintained by the terms of Article 8
then, to the extent that the cost of repairing or replacing such damage or
destruction does not exceed the amounts of such insurance, Tenant shall be
relieved from such obligation to repair or replace. Base Rent and
Additional Rent shall not be abated as a result of willful conduct of
Tenant or its agents, employees or independent contractors which result in
or cause such damage or destruction.
ARTICLE 11.
CONDEMNATION
------------
11.1) If during the Term of the Lease the entire Leased Premises shall
be taken as a result of the power of eminent domain, condemnation
proceedings or other like proceedings (the Proceedings), the Lease and all
right, title and interest of Tenant hereunder shall cease and come to an
end on the date of taking of possession pursuant to the Proceedings.
Landlord shall be entitled to and shall receive the total award made in the
Proceedings. Tenant hereby assigns any interest in any such award to
Landlord.
11.2) If during the Term less than the entire Leased Premises, but
twenty-five percent (25%) or more of the Improvements (calculated by the
number of square feet of floor space) or fifty percent (50%) or more of the
Land shall be taken by the Proceedings, the Lease shall, upon taking of
possession pursuant the Proceedings, terminate as to the portion of the
Land and Improvements so taken, and Tenant may terminate the Lease as to
the remainder of the Leased Premises. Such termination as to the remainder
of the Leased Premises shall be effected by a notice to Landlord in writing
given not more than sixty (60) days after the date of taking of possession
pursuant to such Proceedings, and shall specify a date not more than sixty
(60) days after the giving of such notice as the date of such termination.
Upon the date specified in such notice, the Term and all right, title and
interest of Tenant hereunder shall cease and come to an end. If Tenant
elects not to terminate the Lease, the Lease shall continue in full force
and effect, but the Base Rent shall be reduced pro rata in accordance with
the percentage of value of the Leased Premises so taken compared with the
total value of the Leased Premises immediately prior to said taking.
Nothing herein contained shall affect Tenant's obligation to pay in full
the Additional Rent. Landlord shall, however, at Landlord's sole cost and
expense, restore that portion of the Leased Premises not so taken to a
complete architectural unit for the use and occupancy of Tenant. The Lease
shall continue in full force and effect, but the Base Rent shall be reduced
pro rata as aforesaid.
ARTICLE 12.
ASSIGNMENT AND SUBLETTING
-------------------------
12.1) Tenant shall have the full right to assign, transfer or sublease
its rights under this Lease Agreement, with the prior written consent of
Landlord, which consent shall not be unreasonably
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withheld. No such assignment, transfer or subleasing shall relieve Tenant
from any of its obligations contained in this Lease Agreement.
ARTICLE 13.
DEFAULTS OF TENANT
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13.1) If during the Term of the Lease (a) Tenant shall make an
assignment for the benefit of creditors, or (b) a voluntary petition be
filed by Tenant under the Bankruptcy Act of the United States or any state
statute similar thereto, or Tenant be adjudged insolvent or a bankrupt
pursuant to an involuntary petition, or (c) a receiver or trustee be
appointed for the property of Tenant by reason of insolvency of Tenant, or
(d) any department of the state or federal government, or any officer
thereof duly authorized, shall take possession of the business or property
of Tenant by reason of the insolvency of the Tenant, or (e) if, under
Chapter XI of the Bankruptcy Act, Tenant continues in possession without
the appointment of a receiver or trustee, or (f) Tenant is the subject of
any petition or proceeding related to relief from creditors, the Lease
shall, upon the happening of any of said contingencies and at Landlord's
option, be terminated and the same shall expire as fully and completely as
if the day of the happening of such contingency were the date herein
specifically fixed for the expiration of the Term, and Tenant will then
quit and surrender the Leased Premises, but Tenant shall remain liable as
hereinafter provided.
13.2) If during the Term of the Lease Tenant shall default in
fulfilling any of the covenants of the Lease (other than the covenants for
the payment of Base Rent or Additional Rent), Landlord may give Tenant
notice of any default or of the happening of any contingency referred to in
this paragraph, and if at the expiration of thirty (30) days after the
service of such notice the default or contingency upon which said notice
was based shall continue to exist, or in the case of a default or
contingency which cannot with due diligence be cured within a period of
thirty (30) days, if Tenant fails to proceed promptly after the service of
such notice and with all due diligence to cure the same and thereafter to
prosecute the curing of such default with all due diligence, Landlord, at
its option, may terminate the Lease, and upon such termination, Tenant will
quit and surrender the Leased Premises to Landlord, but Tenant shall remain
liable as hereinafter provided.
13.3) If Tenant shall default in the payment of the Base Rent
expressly reserved hereunder, or any part of the same, and such default
shall continue for fifteen (15) days after notice thereof by Landlord, or
such default in the payment of any item of Additional Rent to be paid by
Tenant hereunder, or any part of the same, and such default shall continue
for thirty (30) days after notice thereof by Landlord, or if the Lease
shall expire as provided in Paragraphs 13.1 or 13.2 of this Article,
Landlord or Landlord's agents and servants may immediately or at any time
thereafter re-enter the Leased Premises and remove all persons and any or
all property therefrom, either by summary dispossession proceedings or by
any suitable action or proceedings at law or by force or otherwise and
repossess and enjoy said Leased Premises, together with all additions,
alterations and improvements, without re-entry and repossession working
forfeiture or waiver of the rents to be paid and the
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covenants to be performed by Tenant during the Term hereof. Upon the
expiration of the Term of the Lease by reason of any of the events
described in Paragraphs 13.1 or 13.2, or in the event of termination of the
Lease by summary dispossession proceedings or under any provision of law
now or hereafter in force by reason of or based upon or arising out of a
default under or a breach of the Lease on the part of Tenant (except where
such breach or default is determined by a court of competent jurisdiction
to be justified because of Landlord's acts or omissions), or upon Landlord
recovering possession of the Leased Premises in the manner or in any of the
circumstances whatsoever, whether with or without legal proceedings, by
reason of or based upon or arising out of a default under or a breach of
the Lease on the part of Tenant, Landlord may, at its option, at any time
and from time to time, relet the Leased Premises, or any part thereof, for
the account of Tenant or otherwise, and receive and collect the rents
therefor, applying the same first to the payment of such expenses as
Landlord may have incurred in recovering possession of the Leased Premises,
including legal expenses and attorneys' fees, and for putting the same into
good order or condition or preparing or altering the same for re-rental and
all other expenses, commissions and charges paid, assumed, or incurred by
Landlord in reletting the Leased Premises and then to the fulfillment of
the covenants of Tenant hereunder. Any such reletting herein provided for
may be for the remainder of the Term of the Lease as originally granted or
for a longer or shorter period. In any such case or whether or not the
Leased Premises, or any part thereof, is relet, Tenant shall pay to
Landlord the Base Rent and the Additional Rent required to be paid by
Tenant up to the time of such termination of the Lease, as the case may be,
and thereafter, except in a case where liability of Tenant as hereinafter
provided arises by reason of any of the contingencies referred in Paragraph
13.l hereof, Tenant covenants and agrees, if required by Landlord, to pay
to Landlord until the end of the Term of the Lease the equivalent of the
amount of all the Base Rent and Additional Rent reserved herein less the
net proceeds of reletting, if any. Landlord shall have the election, in
place and stead of holding Tenant so liable, forthwith to recover against
Tenant, as damages for loss of the bargain and not as penalty, an aggregate
sum which at the time of such termination of the Lease for such recovery of
possession of the Leased Premises by Landlord, as the case may be,
represents the then present worth of the excess, if any, of the aggregate
of the Base Rent and Additional Rent payable by Tenant hereunder that would
have accrued for the balance of the Term, over the aggregate rental value
of the Leased Premises for the balance of such Term.
13.4) The specified remedies to which Landlord may resort under the
terms of the Lease are cumulative and are not intended to be exclusive of
any other remedies or means of redress to which Landlord may be lawfully
entitled in case of any breach or threatened breach by Tenant of any
provision of the Lease. The failure of Landlord to insist in any one or
more cases upon the strict performance of any of the covenants of the Lease
or to exercise any option herein contained shall not be construed as a
waiver or a relinquishment for the future of such covenant or option. A
receipt by Landlord of Base Rent or Additional Rent, including payment of
Base Rent or Additional Rent by Tenant's receiver, trustee in bankruptcy,
creditor or assignee, with knowledge of breach of any covenant hereof
(other than the payment of Base Rent or Additional Rent) shall not be
deemed a waiver of such breach, and no waiver by Landlord of any provision
of this Lease shall be deemed to have been made unless expressed in writing
and signed by Landlord. In addition to other remedies
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provided in this Lease, Landlord shall be entitled to the restraint by
injunction for the violation or attempted or threatened violation of the
covenants, conditions or provisions of the Lease.
ARTICLE 14.
ATTORNEYS FEES
--------------
If it is necessary for Landlord to retain the services of an attorney at
law to enforce any of the terms, covenants or provisions hereof, or to collect
any sums due hereunder, Tenant shall pay to Landlord upon demand, as Additional
Rent hereunder, the cost of such services.
ARTICLE 15.
REMOVAL OF IMPROVEMENTS AND FIXTURES
------------------------------------
Any improvements or fixtures installed by Tenant in the Improvements or on
the Land, whether used solely in Tenant's business or whether usable in the
Improvements without regard to such business or otherwise, shall become the
property of Landlord upon the termination of the Lease.
ARTICLE 16.
CONDITION OF LEASED PREMISES AT TERMINATION
-------------------------------------------
At the termination of the Lease by lapse of time or otherwise, Tenant shall
return the Leased Premises in as good a condition as when Tenant took
possession, excepting only ordinary wear and tear and condemnation, damage or
destruction as described in Articles 10 and 11 herein.
ARTICLE 17.
HOLDING OVER
------------
In the absence of any written agreement to the contrary, if Tenant should
continue to occupy the Leased Premises following the expiration of the Term of
the Lease, Tenant shall so remain as a hold-over tenant from month to month and
all provisions of the Lease applicable to such tenancy shall remain in full
force and effect. During such tenancy, the same Base Rent and the same terms and
conditions as prevailed during the last month of the Term demised shall prevail.
In any such event, Tenant shall be liable to Landlord for damages which Landlord
may incur as a result of such holding over, including but not limited to damages
incurred because of loss of a prospective successor tenant. If Tenant is a
hold-over tenant and if Tenant continues to occupy the Leased Premises following
the termination of such hold-over (by a proper notice as to such month-to-month
tenancy), then the foregoing provisions of this Article shall apply in the same
manner as when Tenant continued in occupancy following the expiration of the
Term of the Lease.
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ARTICLE 18.
USE OF LEASED PREMISES
----------------------
The Leased Premises shall be used only for manufacturing and warehousing.
Tenant shall not use or occupy the Leased Premises or knowingly permit the
Leased 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 affecting the same, or which would
cause structural injury to the Leased Premises or cause the value or usefulness
of the Leased Premises or any part thereof to substantially diminish (reasonable
wear and tear excepted) or which would constitute a public or private nuisance
or waste. Tenant shall not use the Premises in such a manner that would cause
any hazardous substance (as that term is defined by federal or state statutes),
asbestos or petroleum product to contaminate the Leased Premises. Tenant shall
be solely responsible for the clean-up of the Premises should the Premises
become contaminated as a result of Tenant's action. Tenant shall promptly upon
discovery of any such use, take all necessary steps to compel the discontinuance
of such use.
ARTICLE 19.
PERMITS
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Tenant shall maintain in force and effect all permits, licenses and similar
authorizations to use the Leased Premises for the aforesaid purposes required by
any governmental authority having jurisdiction over the use thereof. Tenant's
failure to maintain such permits, licenses and similar authorizations shall not
relieve Tenant from the performance of its obligations and covenants hereunder
(except obligations and covenants as may be prohibited by law), nor from the
obligations to pay Base Rent or Additional Rent, as set forth herein. Tenant
shall, at Landlord's request, join with Landlord in executing, acknowledging and
delivering any and all petitions, consents, subordinations, plats, or easement
deeds that may be required for the installation of any utilities, public
improvements, roads, water lines, sewer lines, storm drainage facilities,
subdivision, rezoning, special use, platting or other similar development of the
Leased Premises, which do not affect Tenant's use of the Leased Premises during
the Term of the Lease.
ARTICLE 20.
COMPLIANCE WITH LAW
-------------------
Tenant, at its sole expense, shall promptly comply with all laws,
ordinances and requirements of federal, state, county and municipal authorities
relating to Tenant's use and occupation of the Leased Premises, and with any
lawful order or direction of any public officer relating to Tenant's use and
occupation of the Leased Premises during the Term of the Lease. Nothing herein
contained, however, shall prohibit Tenant from appealing from or contesting the
validity or legality of such laws, ordinances, requirements, orders or
directions and, notwithstanding the foregoing provisions of this Article, Tenant
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shall not be deemed, to be in default hereunder so long as Tenant diligently
prosecutes such appeal or contest.
ARTICLE 21.
LANDLORD'S ACCESS TO PREMISES
-----------------------------
21.1) Tenant shall permit Landlord and the authorized representatives
of Landlord to enter the Leased Premises at all times during usual business
hours for the purpose of inspecting the same and making any necessary
repairs to comply with any laws, ordinances, rules, regulations or
requirements of any public authority or of the Board of Fire Underwriters
or any similar board. Nothing herein shall imply any duty upon the part of
Landlord to do any such work which, under any provision of the Lease,
Tenant may be required to perform, and the performance thereof by Landlord
shall not constitute a waiver of Tenant's default in failing to perform the
same. Landlord may, during the progress of any work in the Leased Premises,
reasonably keep and store upon the Leased Premises all necessary materials,
tools and equipment. Landlord shall not in any event be liable (except in
the case of gross negligence or willful misconduct of Landlord or its
agents) for inconvenience, annoyance, disturbance, loss of business or
other damage to Tenant by reason of making repairs or the performance of
any work in the Leased Premises, or on account of bringing materials,
supplies and equipment onto or through the Leased Premises during the
course thereof, and the obligations of Tenant under the Lease shall not
hereby be affected in any manner whatsoever. Landlord shall, however, in
connection with the doing of any such work cause as little inconvenience,
annoyance, disturbance, loss of business or other damage to Tenant as may
reasonably be possible in the circumstances.
21.2) Landlord is hereby given the right during usual business hours
to enter the Leased Premises and to exhibit the same for the purpose of
sale and lease during the final six (6) months of the Term hereof. Landlord
shall be entitled to display on the Leased Premises in such manner as not
to unreasonably interfere with Tenant's business the usual `For Sale' or
`To Let' signs, and Tenant agrees that such signs may remain unmolested
upon the Leased Premises and Landlord may exhibit said Leased Premises to
prospective Tenants during such period.
ARTICLE 22.
INDEMNITY
---------
Tenant shall indemnify and save harmless Landlord against and from any and
all claims by or on behalf of any person or persons, firm or firms, corporation
or corporations, arising from the conduct or management of or from any work or
thing whatsoever done in, on or about the Leased Premises, and will further
indemnify and save Landlord harmless against and from any and all claims arising
during the Term of the Lease from any condition of the Leased Premises or any
street, curb, sidewalk adjoining the Leased Premises, or of any passageways or
spaces therein or appurTenant thereto, or arising from any breach or default on
the part of Tenant in the performance of any covenant or agreement on the part
of Tenant to be performed, pursuant to the terms of the Lease, or arising from
any act of
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negligence of Tenant, or any of its agents, contractors, servants, employees or
licensees, or arising from any accident, injury or damage whatsoever caused to
any person, firm or corporation occurring during the Term of the Lease, in or
about the Leased Premises, or upon or under the sidewalks and the land adjacent
thereto, and from and against all costs, reasonable attorneys' fees, expenses
and liabilities incurred in or about any such claim or action or proceeding
brought thereon; and in case any action or proceeding is brought against
Landlord by reason of any such claim, Tenant, upon notice from Landlord, shall
resist or defend such action or proceeding by counsel reasonably satisfactory to
Landlord.
ARTICLE 23.
ESTOPPEL CERTIFICATE
--------------------
Tenant shall, at any time and from time to time, upon not less than twenty
(20) days' prior notice by Landlord, execute, acknowledge and deliver to
Landlord a statement in writing certifying that the Lease is unmodified and in
full force and effect (or if there shall have been modifications that the Lease
is in full force and effect as modified and stating the modifications) and the A
dates to which the Base Rent and Additional Rent have been paid in advance, if
any, and stating whether or not (to the best knowledge of Tenant) Landlord is in
default in the performance of any covenant, agreement or condition contained in
the Lease and, if so, specifying each such default of which Tenant may have
knowledge, it being intended that any such statement delivered pursuant to this
Article shall be in a form approved by and may be relied upon by any prospective
assignee of Landlord's interest in the Lease or any mortgagee of the Leased
Premises or any assignee of any mortgage upon the Leased Premises.
ARTICLE 24.
SUBORDINATION
-------------
This Lease is subject and subordinate to all mortgages and other collateral
agreements which may now or hereafter affect the premises, and to all renewals,
modifications, consolidations, replacements, and extensions thereof (hereinafter
referred to as the "mortgage"). This clause shall be self-operative and no
further instrument of subordination will be required. If additional confirmation
of such subordination is requested, Tenant, without expense to Lessor, shall
execute promptly any appropriate instrument Lessor may request. Provided,
however, that in the event that the holder of the mortgage forecloses the
mortgage or takes a deed from the owner of the premises in lieu of mortgage
foreclosure, the mortgage holder, at its election may give written notice to
Tenant of its intention to hold Tenant to the terms of this Lease within twenty
(20) days after the expiration of the period of redemption or delivery of the
deed in lieu of foreclosure, whichever is applicable, in which event this Lease
shall be deemed to be a direct Lease between the said mortgage holder and Tenant
as of the date of exercise of election and this Lease shall thereafter be in
full force and effect according to the terms herein and Tenant shall be bound to
the mortgagee under all of the terms, covenants and conditions of this Lease for
the balance of the term hereof remaining. In the event of any such election by
the mortgage holder, however, Tenant shall, and does hereby, remise, release and
forever discharge
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mortgage holder of, from and against any and all undertakings,
agreements and liabilities of Lessor under the terms of this Lease, excepting
only the covenant of quiet possession, and Tenant agrees that thereupon and
thereafter all rentals reserved hereunder, as well as any rental accrued to the
effective date of such election by mortgage holder, shall be absolutely due and
owing by Tenant to Lessor, free from any right of set-off or counter-claim,
excepting only in respect of breaches by the mortgage holder, after giving such
election, of the Lessor's covenant of quiet possession; and except for such
covenant of quiet possession, Tenant shall thereupon and thereafter be liable to
such mortgage holder, as Lessor, for each and every covenant, agreement and
undertaking contained herein on the part of Tenant to be performed.
ARTICLE 25.
RELEASE OF LANDLORD
-------------------
If Landlord sells or otherwise transfers all of its interest in the Leased
Premises, Landlord shall, without further action by any party, be released and
discharged from any further obligation or duty under the Lease, and no claim or
demand upon Landlord shall thereafter be made by Tenant arising out of any
obligation or duty of Landlord hereunder. Upon request by Landlord, Tenant shall
execute an attornment agreement with Landlord's transferee in form satisfactory
to such transferee.
ARTICLE 26.
SEVERABILITY
------------
If any term, condition or provision of the Lease or the application thereof
to any person or circumstance shall, to any extent, be held to be invalid or
unenforceable, the remainder thereof and the application of such terms,
provisions and conditions shall, in all other respects, continue to be effective
and to be complied with to the full extent permitted by law.
ARTICLE 27.
SHORT FORM LEASE
----------------
At the request of either party hereto, a short form lease shall be prepared
in form and substance reasonably satisfactory to each of the parties and shall
be executed by each of the parties in duplicate, such lease to be filed for
record in ▇▇▇▇▇▇ County, Minnesota.
ARTICLE 28.
NOTICES
-------
Any notice or election herein requested or permitted to be given or served
by either party hereto upon the other, shall be deemed given or served in
accordance with the provisions of the Lease if delivered to either party hereto
and receipt is obtained therefor, or if mailed in a sealed wrapper by United
States registered or certified mail, postage prepaid, properly addressed to such
other party as
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the address hereinafter specified. Unless and until changed by
notice as herein provided, notices and communications shall be addressed as
follows:
If to Landlord: Fleninge Partnership
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
with a Copy to: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇▇▇ & ▇▇▇▇▇▇ Chartered
1100 Southpoint Center
▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
If to Tenant: Empak, Inc.
____________________________
____________________________
Each such mailed notice or communications shall be deemed to have been given to,
or served upon the party to which addressed, on the date the same is deposited
in the United States registered or certified mail, postage prepaid, properly
addressed in the manner above provided. Each such delivered notice or
communication shall be deemed to have been given to, or served upon, the party
to whom delivered, upon delivery thereof in the manner above provided. Either
party may change the address to which mailed notice is to be sent to it by
giving to the other party hereto not less than thirty (30) days' advance written
notice thereof. All payments of Base Rent or Additional Rent hereunder shall be
made to Landlord at the address above designated, or as may be hereafter
designated.
ARTICLE 29.
HEADINGS
--------
The headings incorporated in the Lease are for convenience in reference
only and are not a part of the Lease and do not in any way limit or add to the
terms and provisions hereof.
ARTICLE 30.
BINDING EFFECT
--------------
All of the covenants, conditions and agreements herein contained shall
extend to, be binding upon and inure to the benefit of the parties hereto and
their respective heirs, successors and assigns.
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ARTICLE 31.
ENTIRE AGREEMENT
----------------
This Lease Agreement contains the entire agreement between Landlord and
Tenant with respect to the subject matter hereof, and, upon the effective date
hereof, this Lease Agreement shall supersede all prior understandings and
agreements, including, but not limited to that certain Lease Agreement dated
October 22, 1981, between Fluoroware, Inc., a Minnesota corporation, and Empak,
Inc., as extended and renewed, the Landlord's interest in the same being
assigned to Landlord as of April 12, 1991, and as amended by Amendment to Lease
Agreement dated September 1, 1992. This Lease Agreement may only be amended or
modified by a written instrument signed by all of the parties thereto.
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IN WITNESS WHEREOF, the parties have executed this Lease the day and year
first above written.
LANDLORD:
FLENINGE PARTNERSHIP
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
-------------------------------------
Its:
------------------------------
TENANT:
EMPAK, INC.
By: /s/ illegible
-------------------------------------
Its: C.E.O.
------------------------------
STATE OF MINNESOTA)
) ss.
COUNTY OF HENNEPIN)
On this ___ day of June, 1993, before me personally appeared
_____________________, a general partner of FLENINGE PARTNERSHIP, a Minnesota
general partnership, on behalf of the partnership.
--------------------------
Notary Public
STATE OF MINNESOTA)
) ss.
COUNTY OF HENNEPIN)
On this ___ day of June, 1993, before me personally appeared
_____________________, the _________________________ of EMPAK, INC., a Minnesota
corporation, on behalf of the corporation.
--------------------------
Notary Public
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