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LEASE

Lease Agreement

LEASE | Document Parties: MPC CORP | GATEWAY, INC | MPC-PRO, LLC You are currently viewing:
This Lease Agreement involves

MPC CORP | GATEWAY, INC | MPC-PRO, LLC

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Title: LEASE
Governing Law: South Dakota     Date: 11/14/2007
Industry: Software and Programming     Law Firm: Holland Hart     Sector: Technology

LEASE, Parties: mpc corp , gateway  inc , mpc-pro  llc
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Exhibit 10.11

 

LEASE

 

THIS LEASE (the “Lease”) is made this 4th day of September, 2007 by and between GATEWAY, INC., a Delaware corporation (hereinafter designated “Landlord”), and MPC-PRO, LLC , a Delaware limited liability company (hereinafter designated as “Tenant”).

 

WITNESSETH:

 

1.              DATA SHEET.

 

This Section 1 is an integral part of this Lease and all of the terms, dates and requirements hereof are incorporated into this Lease in all respects. In addition to the other provisions which are elsewhere defined in this Lease, the following terms, whenever used in this Lease, shall have the meaning set forth in this Section 1, subject to adjustments thereto or more detailed definitions set forth elsewhere in this Lease. If there is any conflict between any of the Lease provisions set forth in this Section 1 and any other provisions of this Lease, the latter shall control.

 

(a)            Premises:

 

(1)            Building: Argentina Building

 

(2)            Suite/Floor Number: Suite 220, 300 North Centennial Drive, North Sioux City, South Dakota 57049

 

(b)            Rentable Square Feet of Premises: Approximately 45,552

 

(c)            Total Gross Rentable Square Feet in Building: 214,594

 

(d)            Tenant’s Percentage Share of Building: 21.22%

 

(e)            Lease Commencement Date: The Acceptance Certificate Date

 

(f)             Lease Term: Five (5) years from Lease Commencement Date

 

(g)                                  Initial Annual Base Rent: Months 1-12 $9.60 per rentable square foot (Base Rent schedule set forth in Section 5 of this Lease).

 

(h)            Option Term: Two (2) five (5) year option terms

 

(i)             Security Deposit: $36,400.00

 

(j)             Tenant Improvement Allowance: $0

 

(k)            Permitted Uses: General office, recruiting and training purposes, and any all related and incidental     uses.

 

2.              LEASED PREMISES.

 

A.             In consideration of all Tenant’s undertakings hereinafter set forth, including payment of rent as hereinafter specified, and contingent upon the satisfaction of all of the conditions set forth in Section 3 of this Lease (or waiver thereof), Landlord hereby leases to Tenant, and Tenant hereby leases from Landlord, the premises (the “Premises”) that are part of the Building located at 300 North Centennial Drive in North Sioux City, South Dakota in the suite/floor area designated in Section 1(a)(2) of the Data Sheet and as shown outlined on the leasing plan attached hereto as Exhibit A, and containing the approximate number of rentable square feet set forth in Section 1(b).

 

B.             During the Term of this Lease, Tenant shall have the right to use, subject to the terms of this Lease, the Rules and Regulations referenced in Section 16 below, and all covenants, conditions and restrictions now or hereafter affecting the Building, the Premises; provided, however, within five (5) days of the Execution Date, Landlord shall deliver a copy of any such covenants, conditions and restrictions of which Landlord has actual knowledge to Tenant. Further, Landlord shall promptly notify Tenant in writing of any modifications to any such covenants, conditions and restrictions of which Landlord has actual knowledge.

 

C.             During the Term of this Lease, Tenant shall have the right at no additional cost to Tenant to the non-exclusive use of the existing 500 KW generators upon the following terms and conditions: (i) in no event shall Landlord be deemed to be making any representation and/or warranty with respect to the condition or fitness of such generator except as set forth herein; (ii) Tenant shall be responsible for its pro-rata cost of all maintenance and operation

 

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associated with the generator (as billed by Landlord within thirty (30) days following the delivery of such bill, as additional rent due under this Lease) as well as all costs associated with segregating circuits of the existing generator, or running new feeds to appropriate distribution panels; (iii) Tenant shall use such generator in accordance with applicable laws, codes, ordinances and regulations; and (iv) Tenant shall obtain the prior written consent of Landlord to any modifications, alterations, improvements or work on such generators.

 

D.             Tenant hereby covenants and agrees that it shall have the right to exclusive use of the building equipment, fixtures and communication cabling located in the Premises which do not service other premises in the Building throughout the Lease Term at no cost or expense to Tenant. Landlord and Tenant acknowledge and agree that Landlord is providing such property to Tenant for its use in an as-is basis without representation or warranty of any kind whatsoever, including the disclaimer of any warranties of merchantability, fitness for a particular purpose or any other thing or nature whatsoever. Tenant shall be responsible for the cost of any transportation and reconfiguration of any such items.

 

E.              Pending completion of fit-up for the Premises, Tenant shall have the use of temporary space provided by Landlord under the same terms and conditions as this Lease.

 

F.              Subject to existing rights of other Tenants, Tenant shall have a right of first refusal to enter into a lease for the remaining approximately 63,641 square feet of space adjacent to the Premises on the second floor of the Building on the same terms and conditions contained in this Lease (the “Right of First Refusal”). In the event Landlord desires to lease such additional 63,641 square feet of space, Landlord shall, subject to existing rights of other Tenants, offer the space to Tenant by notifying the Tenant in writing (the “Right of First Refusal Notice”). If Tenant does not exercise its Right of First Refusal by notifying Landlord in writing of such exercise within five (5) days after having received the Right of First Refusal Notice, Landlord shall be free to lease the space to any third party.

 

3.              CONDITIONS TO CLOSING.

 

A.             Landlord’s obligation to lease the Premises to Tenant shall be both subject to and conditioned upon the satisfaction of all of the following conditions:

 

1.              The Closing (as defined in the Asset Purchase Agreement) of the transaction contemplated by the Asset Purchase Agreement among Landlord, Tenant, MPC Corporation and Gateway Technologies, Inc. dated September 4, 2007 (the “Asset Purchase Agreement”).

 

2.              The termination or expiration of the right of first refusal to lease the Premises held by Alorica, Inc. (“Alorica”) pursuant to that Lease dated August 10, 2006 by and between Gateway Inc. and Alorica Inc. (the “Alorica Lease Agreement”).

 

3.              Landlord shall have received from Tenant the declaration in the form attached hereto as Exhibit B specifying the information called for therein (the “Acceptance Certificate”).

 

4.              Landlord shall have received from Tenant $36,400.00 to be held as collateral security for the payment of Base Rent, Additional Rent and any other sums payable by Tenant under this Lease, and for the faithful performance by Tenant of all other covenants, conditions and agreements of this Lease, pursuant to Section 7 of this Agreement.

 

B.             Tenant’s obligation to lease the Premises from Landlord shall be both subject to and conditioned upon the satisfaction of all of the following conditions:

 

1.              The Closing (as defined in the Asset Purchase Agreement) of the transaction contemplated by the Asset Purchase Agreement.

 

2.              The termination or expiration of the right of first refusal to lease the Premises held by Alorica pursuant to the Alorica Lease Agreement.

 

3.              Tenant’s acceptance and approval of the Premises (which approval may be granted or withheld in its sole and absolute discretion) after having completed a “walk-through” inspection and review of the Premises.

 

4.              TERM AND COMMENCEMENT OF TERM.

 

A.             The term of this Lease (the “Term”) shall commence on the date (the “Lease Commencement Date”)

 

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that the Acceptance Certificate is delivered by Tenant to Landlord (the “Acceptance Certificate Date”), provided that all of the other conditions to closing set forth in Section 3 have been satisfied or waived.

 

B.             The Term shall end on the expiration of the fifth (5 th ) year following the Lease Commencement Date unless the Term terminates sooner pursuant to any other provision of this Lease or pursuant to law.

 

C.             Provided that (i) Tenant has not been in default under the Lease, and is not then in default under this Lease and no event or circumstance has occurred which, with the passage of time or the giving of notice, or both, could result in such a default, and/or (ii) Tenant has not assigned this Lease or sublet all or any portion of the Premises , Tenant may elect to extend the Lease Term for two (2) five (5) year renewal terms (each an “Option Term”) by giving Landlord written notice of its desire to do so at least nine (9) months prior to the end of the current Lease Term. In the event Tenant elects to extend the Lease Term as herein provided, the Lease shall automatically be extended for such Option Term, upon the same terms and conditions as provided for herein, except that the Base Rent shall be an amount equal to ninety-five percent (95%) of the then fair market rental value of the Premises (as determined pursuant to Exhibit E attached hereto).

 

5.              CONDITION OF PREMISES.

 

A.             Tenant hereby acknowledges and agrees that it is to demise the Premises in an “AS-IS” condition and Tenant’s taking possession of the Premises shall be conclusive evidence as against Tenant that the Premises were in good order and satisfactory condition when Tenant took possession. No promise of Landlord to alter, remodel or improve the Premises, and no representation respecting the condition of the Premises has been made by Landlord to Tenant. Notwithstanding any other provision herein to the contrary, Landlord shall be responsible for all plans, specifications and costs associated with demising the Premises. Upon the expiration of the term hereof, or upon any earlier termination of the term hereof or of Tenant’s right to possession, Tenant shall surrender the Premises in at least as good condition as at the commencement of the term of this Lease, ordinary wear and tear excepted.

 

B.             Landlord and Tenant acknowledge and agree that any and all alterations to be installed by Tenant within the Premises upon the inception of the Term of this Lease shall be subject to the approval of Landlord (which approval shall not be unreasonably withheld, conditioned or delayed). Any and all such alterations shall comply with all of the terms and conditions of this Lease and no approval by Landlord shall be deemed a representation and/or warranty by Landlord as to the sufficiency of same or the compliance of same with any and all applicable laws, codes, rules, ordinances or regulations. Tenant shall perform any and all such work at its sole cost and expense and in a lien-free manner. Notwithstanding the foregoing, Tenant may install and maintain furnishings, equipment, movable partitions, business equipment and other trade fixtures (the “Trade Fixtures”) in the Premises, provided that the Trade Fixtures do not become an integral part of the Premises or the Building, without Landlord’s prior consent. Tenant shall promptly repair any damage to the Premises or the Building caused by any installation or removal of such Trade Fixtures.

 

6.              RENT.

 

A.             Tenant shall pay to Landlord the following rent under this Lease:

 

1.              Commencing on the Lease Commencement Date, base rent (“Base Rent”) payable in advance in equal monthly installments (“Monthly Base Rent”) pursuant to the schedule below. The first installment of Monthly Base Rent shall be due and payable on the execution of this Lease in an amount equal to a full month’s installment, and the remaining successive installments shall be due and payable on the first day of each calendar month during the Term. If the Rent Commencement Date occurs on a day other than the first day of a month, Base Rent from the Rent Commencement Date until the first day of the following month shall be prorated at the rate of one-thirtieth (1/30) of the Monthly Base Rent for each day, and any excess paid as the first installment on the execution of this Lease shall be credited toward the second installment.

 

Period

 

Monthly Base Rent

 

 

 

 

 

Month 1 – 12

 

$

36,441.60

 

Month 13 – 24

 

$

37,542.44

 

Month 25 – 36

 

$

38,681.24

 

Month 37 – 48

 

$

39,858.00

 

Month 49 – 60

 

$

41,072.72

 

 

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2.              Commencing on the Lease Commencement Date, additional rent (“Additional Rent”) consisting of all other sums of money as shall become due from Tenant under this Lease.

 

3.              All Base Rent and Additional Rent payable under this Lease shall be collectively referred to herein as “Rent.”

 

B.             Tenant shall pay all Rent without demand, deduction, set-off or counterclaim. If Tenant fails to make any payment of Rent or other sums required to be paid to Landlord hereunder within five (5) business days of any payment due date, Tenant shall pay to Landlord, as Additional Rent, for each month or part thereof until paid, a late fee equal to five percent (5%) of the amount due to cover Landlord’s administrative expenses, and interest until paid at the Default Rate provided under this Lease; provided, however, that should such late fee or interest at any time be deemed to violate any applicable usury laws, the late fee or interest charged shall be the highest permissible by such laws. For default in the payment of Additional Rent, Landlord shall have the same remedies as for a default in the payment of Base Rent. If Landlord shall at any time or times accept any Rent after it has become due and payable, such acceptance shall not excuse delay at subsequent times, nor constitute a waiver of any of Landlord’s rights under this Lease.

 

7.              SECURITY DEPOSIT.

 

Tenant shall pay to Landlord Thirty Six Thousand Four Hundred Dollars ($36,400.00) to be held as collateral security for the payment of Base Rent, Additional Rent and any other sums payable by Tenant under this Lease, and for the faithful performance by Tenant of all other covenants, conditions and agreements of this Lease; the unused portion of the Security Deposit to be repaid to Tenant after the termination of this Lease or any renewal thereof within sixty (60) days of such termination, provided Tenant shall have made all such payments of this Lease. The Security Deposit shall not be mortgaged, assigned, transferred or encumbered by Tenant without the written consent of Landlord, and any such act on the part of Tenant shall be without force and effect and shall not be binding upon Landlord. If any of the rents herein reserved or any other sum payable by Tenant to Landlord shall be overdue and unpaid, or should Landlord make payments on behalf of Tenant, or should Tenant fail to perform any of the terms of this Lease, then Landlord at its option and without prejudice to any other remedy that Landlord may have on account thereof, may appropriate and apply the entire Security Deposit or so much thereof as may be necessary to compensate Landlord toward the payment of Base Rent, Additional Rent or any other sums due Landlord pursuant to this Lease, or loss or damage sustained by Landlord due to such breach on the part of Tenant; and Tenant upon demand shall forthwith restore the Security Deposit to the original sum deposited. Tenant’s failure to restore said deficiency within ten (10) business days after receiving Landlord’s written notice thereof shall constitute a Default hereunder. In the event of bankruptcy or other creditor-debtor proceedings against Tenant, the Security Deposit shall be deemed to be applied first to the payment of Rent and other charges due Landlord for all periods prior to the filing of such proceedings.

 

In the event of a sale or transfer of Landlord’s estate or interest in the Land and Building, and Landlord’s successor-in-interest assumes Landlord’s obligations under this Lease, Landlord shall have the right to transfer the Security Deposit to the vendee or transferee, and Landlord shall be considered released by Tenant from all liability for the return of the Security Deposit. Tenant shall look solely to the transferee for the return of the Security Deposit, and it is agreed that all of the foregoing shall apply to every transfer or assignment made of the Security Deposit to a new transferee. No Mortgagee or purchaser of any or all of the Building at any foreclosure proceeding brought under the provisions of any Mortgage shall (regardless of whether the Lease is at the time in question subordinated to the lien of any Mortgage) be liable to the Tenant or any other person for any or all of such sum (or any other or additional security deposit or other payment made by the Tenant under the provisions of this Lease), unless the Landlord has actually delivered it in cash to such Mortgagee or purchaser, as the case may be. In the event of any rightful and permitted assignment of Tenant’s interest in this Lease, the Security Deposit shall be deemed to be held by Landlord as a deposit made by the assignee, and Landlord shall have no further liability to the assignor with respect to the return of the Security Deposit.

 

No right or remedy available to Landlord or Tenant as provided in this Section shall preclude or extinguish any other right or remedy to which Landlord or Tenant may be entitled.

 

8.              ADDITIONAL RENT TO COVER OPERATING EXPENSES.

 

A.             For each calendar year of the Term, Tenant shall pay to Landlord in the manner provided in this Section 8, as Additional Rent, Tenant’s Share of Operating Expenses in connection with Landlord’s operation and maintenance of the Argentina Building (provided that by the terms of this Lease Tenant does not contract directly for such service) during the initial Lease Term and any extension thereof. Such Operating Expenses shall include, but not be limited to, electricity, gas or other utility costs, property management fee (provided, however, Tenant’s share of  such

 

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property management fee shall not exceed five percent (5%) of Base Rent calculated on an annual basis), real estate taxes, common area expenses, the amortized cost of capital improvements (as distinguished from replacement parts or components installed in the ordinary course of business) which are intended to maintain the quality, appearance or safety of the Building and/or the project in which the Building is located, reduce other operating expenses or increases thereof (but not in excess of the reasonably estimated savings), or which are required to bring the Building and/or the project into compliance with applicable laws and building codes enacted subsequent to the date of this Lease, and insurance costs.

 

Operating Expenses shall not include (i) capital improvements except as authorized by this Lease; (ii) costs of special services rendered to individual tenants (including Tenant) for which a special charge is made; (iii) ground rents or interest and principal payments on loans or indebtedness secured by the Building; (iv) costs of leasehold improvements for Tenant or other tenants of the Building; (v) costs for which Landlord is reimbursed by other tenants of the Building other than through payment of tenants’ shares of Operating Expenses and Taxes; (vi) leasing commissions, attorneys fees, and other expenses incurred in connection with leasing space in the Building or enforcing such leases; (vii) depreciation or amortization; (viii) costs, fines or penalties incurred due to Landlord’s violation of any law; (ix) advertising and promotional expenses; (x) costs incurred because Landlord or any other tenant violated the terms of any lease, contract or other legal obligation; and (xi) costs of repairs or other work needed due to fire, windstorms, or other casualty or cause actually insured against by Landlord, except for casualty insurance deductible amounts.

 

B.             Prior to the determination of the actual amount of Operating Expenses, Tenant shall make monthly installment payments toward such share on an estimated basis, based on Landlord’s estimate of the share. Tenant shall pay Landlord on the first day of each month of the calendar year one-twelfth (1/12th) of the Landlord’s estimate.

 

C.             After the end of each calendar year, Landlord shall determine the amount, if any, by which the actual Operating Expenses for the calendar year varied from the estimated Operating Expenses. Landlord shall provide to Tenant a statement (the “Expense Reimbursement Statement”) of this determination no later than April 1st of the following calendar year. Within twenty (20) days after delivery of the Expense Reimbursement Statement for each calendar year, Tenant shall pay to Landlord any deficiency between the amount shown and the payments made by Tenant toward such amount in accordance with paragraph 7. In the case of excess payments, Tenant shall be credited with the excess toward subsequent estimated payments. Each Expense Reimbursement Statement provided by Landlord pursuant to paragraph 7 shall be conclusive and binding upon Tenant unless within thirty (30) days after the receipt of the Expense Reimbursement Statement Tenant notifies Landlord that it disputes the correctness of the Expense Reimbursement Statement and specifies with particularity the respects in which the Expense Reimbursement Statement is claimed to be incorrect. Pending determination of the dispute, Tenant shall pay any amounts stated to be due from Tenant in accordance with said Expense Reimbursement Statement, but such payment shall be without prejudice to Tenant’s position. Tenant shall have a period of sixty (60) days after delivery of the Expense Reimbursement Statement, upon at least fifteen (15) days notice to Landlord, in which to inspect during normal business hours, and at it expense, the appropriate books and records of Landlord relating to Real Estate Taxes, Insurance Costs and Operating Expenses for the purpose of verifying said Expense Reimbursement Statement. If Tenant fails to review the records or fails to give timely written notice to Landlord as required above, then Tenant shall be deemed to have accepted the Expense Reimbursement Statement.

 

D.             Nothing contained in this Section 8 shall be interpreted at any time to reduce the Monthly Base Rent payable under this Lease below the amounts specified for such Rent in Sections 6 and 7.

 

9.              SALES, USE OR OTHER TAXES.

 

If, during the Term, any governmental authority having jurisdiction levies, assesses or imposes any tax on Landlord, the Premises, the Building, the Land, or the Rent payable hereunder in the nature of a sales tax, a use tax, business license tax or any other tax except (i) income taxes, (ii) estate or inheritance taxes, or (iii) ad valorem real estate taxes (payment of which is provided for in Section 8 as a part of Operating Expenses), Tenant shall pay the same to Landlord as Additional Rent upon the earlier to occur of (1) fifteen (15) days following receipt by Tenant of notice of the amount of such tax or (2) at the time of, and together with, the first payment of Monthly Base Rent due following receipt by Tenant of notice of the amount of such tax. If any such tax is levied, assessed, or imposed in such manner that the amount of the tax required to be paid by Tenant is not ascertainable because the tax relates to more than the Premises or the rents payable hereunder, then Tenant shall pay a share of such taxes equal to the rentable square feet of the Premises divided by the total gross rentable square feet of the Building, as set forth in Section 1 of this Lease if such tax relates to the entirety of the Building, and if such tax is calculated or assessed other than by the entirety of the Building, then Tenant’s share thereof shall be equitably determined by Landlord.

 

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10.           USE.

 

A.             Tenant shall use and occupy the Premises solely for general office, recruiting and training purposes conducted by the Gateway operations acquired under the Asset Purchase Agreement and for no other purpose without the written consent of Landlord.

 

B.             Tenant shall not commit nuisance or waste on the Premises. Tenant shall not use or occupy the Premises or use the Building or any portion of either for any unlawful, disorderly, or hazardous purpose, or in a manner that will obstruct or interfere with the rights of other occupants or their invitees or in any way injure or annoy them. Tenant shall not conduct or permit any activity, or place any equipment, in or about the Premises or the Building that shall in any way increase the rate of insurance premiums on the Building or on any personal property kept in the Building, or conflict with fire laws or regulations or with any insurance policy on the Building or such personal property. Landlord shall have the right to prescribe the maximum weight and position of safes and other heavy equipment or fixtures that Tenant desires to install in the Premises.

 

C.             Landlord further covenants and agrees during the Term and any renewals or extensions thereof to use its best efforts to assist Tenant in the procurement of economic development, government aid, or similar assistance which may be available for Tenant, including providing any required Landlord consents, verifications, confirmations or certificates on behalf of Tenant not to be unreasonably withheld or delayed.

 

D.             Tenant shall comply at its expense with all present and future laws, ordinances and requirements of all governmental authorities that pertain to Tenant or its use of the Premises, including, without limitation, all federal and state occupational health and safety and handicap access requirements, whether or not Tenant’s compliance will necessitate expenditures or interfere with its use and enjoyment of the Premises. Tenant shall not generate, handle, store or dispose of hazardous or toxic materials (as such materials may be identified in any federal, state or local law or regulation) in the Premises or project without the prior written consent of Landlord; provided that the foregoing shall not be deemed to proscribe the use by Tenant of customary office and cleaning supplies in normal quantities so long as such use comports with all applicable laws. Tenant agrees that it shall promptly complete and deliver to Landlord any disclosure form regarding hazardous or toxic materials that may be required by any governmental agency. Tenant shall also, from time to time upon request by Landlord, execute such commercially reasonable affidavits concerning Tenant’s best knowledge and belief regarding the presence of hazardous or toxic materials in the Premises. Landlord shall have the right at any time to perform an assessment of the environmental condition of the Premises and of Tenant’s compliance with this Section at Landlord’s sole cost and expense. As part of any such assessment, Landlord shall have the right, upon reasonable prior notice to Tenant, to enter and inspect the Premises and to perform tests (including physically invasive tests), provided those tests are performed in a manner that minimizes disruption to Tenant. Tenant will cooperate with Landlord in connection with any assessment by, among other things, promptly responding to inquiries and providing relevant documentation and records. Landlord shall have no liability to Tenant with respect to the results of any such assessments, inspections or tests. Notwithstanding the above, the reasonable cost of the assessment/testing shall be reimbursed by Tenant to Landlord if such assessment/testing determines that Tenant failed to comply with the requirements of this Section, and in that event Tenant shall accept custody and arrange for the disposal of any hazardous materials found in the test samples. In all events Tenant shall indemnify Landlord in the manner elsewhere provided in this Lease from any release of hazardous or toxic materials caused by Tenant, its agents, employees, contractors, subtenants or licensees. The foregoing covenants shall survive the expiration or earlier termination of this Lease.

 

Landlord hereby represents and warrants to Tenant that, to the best of Landlord’s knowledge, as of the execution of this Lease and as of the delivery of the Premises to Tenant: (a) no hazardous or toxic materials are, will be, or have been stored, treated, disposed of, or incorporated into, on, or around the Premises in violation of any applicable statutes, ordinances or regulations; (b) the premises are in material compliance with all applicable environmental, health, and safety requirements; and (c) any business heretofore operated on the Property has disposed of its waste in accordance with all applicable statutes, ordinances, and regulations. Landlord has no knowledge of any pending or threatened action or proceeding arising out of the condition of the Premises or any alleged violation of environmental, health, or safety statutes, ordinances or regulations. In no event shall Tenant be liable for, or responsible for any remediation efforts related to, hazardous or toxic materials that impact the Premises, Building or Land prior to the Lease Commencement Date or that impact the Premises, Building or Land after the expiration or earlier termination of this Lease. Further, in no event shall Tenant be liable for any contamination arising out of or related to the acts or omissions of Landlord, its agents, employees, contractors and other tenants on the Premises or in the Building or the Land.

 

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11.           CARE OF THE PREMISES.

 

Tenant shall at its expense keep the Premises (including all improvements, Landlord’s furniture, fixtures, and equipment, and all other property contained in the Premises) in a neat and clean condition, and in good order and repair, and shall surrender the Premises at the end of the Term in as good order and condition as they were at the commencement of the Term, reasonable wear and tear excepted. Tenant shall at its expense obtain janitorial service for the Premises in a manner sufficient to maintain same in a neat and clean condition.

 

12.           ALTERATIONS BY TENANT.

 

A.             Tenant shall not make or permit any improvements, alterations, fixed decorations, substitutions or modifications, structural or otherwise (“Alterations”), to the Premises or to the Building without the prior consent of Landlord (both as to whether any such alterations may be made at all and as to the manner in which they may be made) in each instance (which approval shall not be unreasonably withheld, conditioned or delayed). As used in this Section, the term “Alterations” includes, but is not limited to, the installation, modification or removal of carpeting; partitions; counters; doors; air conditioning equipment, including ductwork; plumbing; piping; lighting fixtures; electrical wiring of any kind, hardware; locks; ceilings;, windows; and window and wall coverings.

 

B.             Alterations may be made only at Tenant’s expense, by contractors or subcontractors approved by Landlord, which approval shall not be unreasonably withheld or delayed, and only after (i) Tenant has obtained all necessary permits from governmental authorities having jurisdiction and furnished copies of the permits to Landlord, (ii) Tenant has submitted complete plans and specifications to Landlord, and (iii) Landlord has given Tenant its approval as provided above. Landlord shall have the right to have the making of any Alterations supervised by its architects, contractors, or workmen at Tenant’s expense. If any mechanic’s, materialman’s or similar lien is filed against the Premises, the Building, or the Land for work done or materials supplied to Tenant, or claimed to have been done for or supplied to Tenant, the lien shall be discharged by Tenant within ten (10) days thereafter, solely at Tenant’s expense, by paying off or bonding the lien, and Tenant shall indemnify and hold Landlord harmless from any and all expenses, liens, claims, or damage to persons or property including, but not limited to, the Building, that may arise from the making of any Alterations. If any Alteration is made without the prior consent of Landlord, Landlord may correct or remove the Alteration at Tenant’s expense. Following completion of the Alterations, Tenant shall deliver to Landlord a complete set of “as built” plans on electric media showing the Alterations, or shall reimburse Landlord for any expense incurred by Landlord in causing the Building plans to be modified to reflect the Alterations.

 

13.           EQUIPMENT.

 

Tenant shall not install or operate in the Premises any equipment or other machinery, other than standard size office copiers, and other machines requiring similar low electric consumption without (i) first obtaining the consent of Landlord (who may condition such consent upon the payment by Tenant of Additional Rent in compensation for additional consumption of utilities or additional wiring needed for the equipment of machinery), and (ii) securing any necessary permits from governmental authorities and utility companies and furnishing copies of such permits to Landlord. Tenant shall not install any equipment or machinery that necessitate any changes, replacements or additions, to, or in the use of, the water, heating, plumbing, air conditioning, or electrical systems of the Building without first obtaining the prior consent of Landlord  (which approval shall not be unreasonably withheld or delayed). Business machines and equipment belonging to Tenant that cause noise or vibration that may be transmitted to any part of the Building to such a degree as to be objectionable to Landlord or to any other tenant shall be installed and maintained by Tenant, at Tenant’s expense, only on vibration eliminators or other devices sufficient to eliminate the noise and vibration.

 

14.                                ALTERATIONS, EQUIPMENT AND OTHER PROPERTY BELONGING TO LANDLORD/REMOVAL OF PERSONAL PROPERTY.

 

A.             Any Alterations and other improvements and any equipment, machinery, furniture, furnishings, and other property, installed or located in the Premises or the Building by or on behalf of Landlord or Tenant (except for “Tenant’s Personal Property,” as hereinafter defined) shall immediately become the property of Landlord and shall remain upon and be surrendered to Landlord with the Premises as a part thereof at the end of the Term; provided, however, that if Tenant is not in default under this Lease, Tenant shall have the right to remove, prior to the end of the Term, Tenant’s Personal Property, and provided, further, that if Landlord should elect that any Alterations be removed at the end of the Term, Tenant shall cause the same to be removed at Tenant’s expense or reimburse Landlord for doing so. The term “Tenant’s Personal Property” shall mean all equipment, machinery, improvements, furniture, fixtures, furnishings and other property now or hereafter installed or placed in or on the Premises or the Building by and at the

 

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sole expense of Tenant with respect to which Tenant has not been granted any credit or allowance by Landlord and which (i) is not used, or was not procured for use, in connection with the operation, maintenance or protection of the Premises or the Building, (ii) is removable without damage to the Premises or the Building, and (iii) is not a replacement of any property of Landlord, whether such replacement is made at Tenant’s expense or otherwise. Notwithstanding any other provision of this Lease, Tenant’s Personal Property shall not include any Alterations, or any improvements or other property installed or placed in or on the Premises as part of Landlord’s Work, whether or not any such Alterations, improvements, or other property were at Tenant’s expense.

 

B.             Tenant shall remove all Tenant’s Personal Property and Trade Fixtures from the Premises at the termination of this Lease. Any property belonging to Tenant or any other person that is left in the Premises after the date the Lease is terminated for any reason shall be deemed to have been abandoned. In such event, Landlord shall have the right to declare itself owner of such property and to dispose of it in whatever manner Landlord considers appropriate without waiving its right to claim from Tenant all expenses and damages caused by Tenant’s failure to remove the property, and Tenant shall not have any right to compensation or claim against Landlord for the value of such property.

 

15.           LANDLORD’S ACCESS TO PREMISES.

 

Landlord and its agents may, at any reasonable time upon reasonable prior notice (except in an emergency, when no such notice shall be required) and without liability to Tenant, other than liability for personal injuries and damages resulting directly from the gross negligence of Landlord or its servants, enter the Premises to examine them or to make alterations or repairs or for any purpose which Landlord considers necessary for the repair, operation, or maintenance of the Building; provided, however, that in the case of an emergency, Landlord may enter the Premises at any time, with or without notice, whether or not said entry is reasonable. Tenant shall allow the Premises to be exhibited by Landlord or its agents upon forty-eight (48) hours prior notice (i) to any representative of lending institutions or to any prospective purchaser or purchasers of the Building, and (ii) during the last twelve (12) months of the Term or renewal term, to prospective tenants of the Premises or other space in the Building.

 

16.           SERVICES AND UTILITIES.

 

So long as Tenant is not in default under this Lease, Landlord shall provide the following facilities and services to Tenant the costs of which shall be included as Operating Expenses:

 

A.             Central heating and air conditioning during the seasons of the year when these services are normally and usually furnished, and within the temperature ranges and in such amounts normally or usually furnished in comparable office buildings in North Sioux City, South Dakota with Tenant to pay its proportionate share of the cost of utilities incurred to provide such heating and air conditioning within thirty (30) days of Landlord’s invoice therefor.

 

B.             Cleaning of the lobby in Landlord’s standard manner and provision of water services to lavatories as normally or usually furnished in comparable office buildings in North Sioux City, South Dakota.

 

C.             Electrical facilities to furnish sufficient electrical power to Tenant’s equipment installed in accordance with Section 13 hereof; provided, however, Tenant shall be responsible to pay any and all costs associated with the use and consumption of any such electrical utility services as Operating Expenses.

 

D.             Access to the Premises on a full-time twenty-four (24) hour basis, subject to such regulations as Landlord may impose for security reasons. Landlord shall have no obligation whatsoever to provide guard service or other security measures for the benefit of the Premises or the Project. Tenant assumes all responsibility for the protection of Tenant, its employees, agents, invitees and property from acts of third parties. Nothing herein contained shall prevent Landlord, at its sole option, from providing security protection for the Project or any part thereof, in which event the non-capital cost thereof shall be included within the definition of Operating Expenses. Tenant hereby acknowledges that existing security improvements are satisfactory.

 

Any failure by Landlord to furnish the foregoing service resulting from Unavoidable Delays, as hereinafter defined, or from temporary interruption of the foregoing services due to repairs or maintenance, shall not render Landlord liable in any respect for damages to either person or property, nor be construed as an eviction of Tenant, nor cause an abatement of rent, or relieve Tenant from Tenant’s obligations under this Lease; provided Landlord uses commercially reasonable efforts to restore such services. For purposes of this Section 16 and of Section 32, the term “Unavoidable Delays” shall mean any delays due to strikes; labor disputes; shortages of material, labor or energy; acts of God; governmental restrictions; enemy action; civil commotion; fire; unavoidable casualty or other causes beyond the control of Landlord and which do not arise from the gross negligence or willful misconduct of Landlord, its officers, agents, employees and licensees.

 

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If any public utility or governmental body shall require Landlord or Tenant to restrict the consumption of any utility or reduce any service for the Premises or the Building, Landlord and Tenant shall comply with such requirements whether or not the utilities and services referred to in this Section are thereby reduced or otherwise affected, without reduction or adjustment of Rent hereunder.

 

Landlord and its agents shall be permitted reasonable access to the Premises, and the right to install facilities within or through the Premises, in order to install and service the systems deemed necessary by the Landlord to provide to other tenants of the Building the services and utilities referred to in this Section.

 

17.                                RULES AND REGULATIONS.

 

Tenant and its agents and invitees shall abide by and observe the rules and regulations attached hereto as Exhibit C and such other rules and regulations as may be promulgated from time to time by Landlord for the operation and maintenance of the Building, provided such rules and regulations do not unreasonably interfere with Tenant’s permitted use of the Premises and do not contradict the terms and provisions of this Lease. Nothing contained in this Lease shall be interpreted to impose upon Landlord any duty or obligation to enforce any such rules and regulations, or the provisions contained in any other lease against any other tenant, and Landlord shall not be liable to Tenant for any violation of these rules, regulations, or lease provisions by any other tenant or its agents or invitees.

 

18.                                INDEMNIFICATION.

 

A.             Tenant shall indemnify and hold Landlord harmless from and against any and all claims, demands, liabilities, and expenses, including attorney’s fees, arising from Tenant’s use of the Premises or from any act permitted, or any omission to act, in or about the Premises or the Building by Tenant or its agents, employees, contractors, or invitees, or from any breach or default by Tenant of this Lease; provided, however, nothing contained herein shall require Tenant to indemnify Landlord against matters resulting from the gross negligence or willful acts or omissions of Landlord or Landlord’s agents, employees, contractors or invitees, or other Tenant or its agents, employees, contractors, or invitees. In the event any action or proceeding shall be brought against Landlord by reason of any such claim, Tenant shall defend the same at Tenant’s expense by counsel reasonably satisfactory to Landlord.

 

B.             Landlord shall indemnify and hold Tenant harmless from and against any and all claims, demands, liabilities, and expenses, including attorney’s fees, arising from Landlord’s ownership and use of the Premises and the Building, or from any act permitted, or any omission to act, in or about the Premises or the Building by Landlord or its agents, employees, contractors, or invitees, or from any breach or default by Landlord of this Lease; provided, however, nothing contained herein shall require Landlord to indemnify Tenant against matters resulting from the negligence or willful acts or omissions of Tenant or Tenant’s agents, employees, contractors or invitees, or other Tenant or its agents, employees, contractors, or invitees.

 

19.                                REPAIR OF DAMAGE CAUSED BY TENANT.

 

All uninsured injury or damage to the Premises or the Building caused by Tenant or its agents or invitees shall be repaired by Landlord at Tenant’s expense.

 

20.                                LANDLORD NOT LIABLE FOR DAMAGE TO PERSONAL PROPERTY OR PERSON.

 

All property of Tenant, its agents or invitees, or of any other person, in or on the Premises or the Building, shall be and remain at the sole risk of Tenant or such agent, invitee or person. Landlord shall not be liable for any damage to or theft or loss of such property, whether or not caused by the act or omission of any person, including Landlord and its agents or invitees, or by the bursting, leaking or overflowing of water, sewer, steam or sprinkler pipes, or heating or plumbing fixtures; air conditioning or heating failure; gas odors; noise; or any other act or thing, unless such damage to or theft or loss of such property results directly from the gross negligence or willful misconduct of Landlord and then only to the extent that Tenant, its agents, invitees, or any other persons are not compensated therefor by insurance. In no event shall Landlord be liable for any interruption of or loss to Tenant’s business that may result from any of the acts or causes described above. Landlord shall not be liable for any personal injury to Tenant, its agents or invitees, or to any other person, arising from the use, occupancy



















 
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