UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
__X__ Quarterly Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
For the quarterly period ended December 31, 1995
or
_____ Transition Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Commission File Number 0-13111
ANALYTICAL SURVEYS, INC.
(Exact name of small business issuer as specified in its charter)
Colorado 84-0846389
(State of incorporation) (IRS Employer Identification No.)
1935 Jamboree Drive
Colorado Springs, Colorado 80920
(Address of principal executive offices) (Zip Code)
(719) 593-0093
(Issuer's telephone number)
Check whether the issuer (1) filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the past (12) months (or for such shorter period that
the registrant was required to file such reports), and (2) has
been subject to such filing requirements for the past ninety (90)
days.
Yes __X__ No_____
The number of shares of common stock outstanding as of
February 9, 1996 was 3,127,549.
<PAGE>
Part I Item 1.
<TABLE>
<CAPTION>
ANALYTICAL SURVEYS, INC.
BALANCE SHEETS
(Unaudited)
December 31, September 30,
1995 1995
_________ _________
ASSETS
<S> <C> <C>
CURRENT ASSETS
Cash $ 335,173 $ 665,274
Accounts receivable, net of $20,000
allowance for doubtful accounts 4,674,578 2,925,094
Unbilled revenues 6,217,703 4,705,020
Prepaid expenses 222,783 209,343
Deferred tax assets 47,311 49,713
__________ __________
Total current assets 11,497,548 8,554,444
__________ __________
PROPERTY AND EQUIPMENT, at cost
Equipment 6,033,788 5,656,521
Furniture and fixtures 830,570 735,313
Leasehold improvements 146,166 133,711
__________ __________
7,010,524 6,525,545
__________ __________
Less Accumulated depreciation and amortization (5,257,036) (5,046,065)
__________ __________
1,753,488 1,479,480
Goodwill, less accumulated amortization 3,153,696 13,751
__________ __________
TOTAL ASSETS $ 16,404,732 $10,047,675
========== ==========
<FN>
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
ANALYTICAL SURVEYS, INC.
BALANCE SHEETS
(Unaudited)
December 31, September 30,
1995 1995
_________ _________
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
<S> <C> <C>
Notes payable to bank (Note 2) $ 300,000 $ -
Current maturities of long-term debt 757,149 417,100
Billings in excess of costs 749,839 176,934
Accounts payable and accrued expenses 2,377,561 1,560,227
Accrued payroll and benefits 632,918 661,951
Accrued income taxes 156,274 -
__________ __________
Total current liabilities 4,973,741 2,816,212
Deferred income tax 84,975 113,290
Long-term debt, less current maturities 3,461,846 408,078
Deferred compensation 57,498 55,407
__________ __________
Total liabilities 8,578,060 3,392,987
__________ __________
STOCKHOLDERS' EQUITY
Preferred stock-authorized 2,500,000 shares
of no par value; none issued and outstanding
Common stock-authorized 100,000,000 shares
of no par value; issued and outstanding
3,064,099 shares at December 31, 1995 and
2,831,349 shares at September 30, 1994 4,357,866 3,461,100
Treasury stock (124,844) (124,844)
Retained earnings 3,593,650 3,318,432
__________ __________
Total stockholders' equity 7,826,672 6,654,688
__________ __________
TOTAL LIABILITIES AND EQUITY $ 16,404,732 $10,047,675
========== ==========
<FN>
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
ANALYTICAL SURVEYS, INC.
STATEMENTS OF OPERATIONS
(Unaudited)
Three months Ended Three months Ended
December 31, December 31,
1995 1994
_________ _________
<S> <C> <C>
SALES OF SERVICES $ 3,648,634 $ 2,916,662
_________ _________
COSTS AND EXPENSES
Salaries, wages and benefits 1,446,577 1,169,878
Subcontractor costs 934,625 756,229
General and administrative 574,364 546,700
Depreciation and amortization 217,122 188,200
_________ _________
3,172,688 2,661,007
_________ _________
EARNINGS FROM OPERATIONS 475,946 255,655
_________ _________
OTHER INCOME (EXPENSE)
Interest (28,271) (34,046)
Miscellaneous Income 43 21
_________ _________
(28,228) (34,025)
_________ _________
EARNINGS BEFORE INCOME TAXES 447,718 221,630
INCOME TAX EXPENSE 172,500 86,000
_________ _________
NET EARNINGS $ 275,218 $ 135,630
========= =========
EARNINGS PER SHARE $ 0.09 $ 0.05
==== ====
<FN>
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
ANALYTICAL SURVEYS, INC.
STATEMENTS OF CASH FLOWS
(Unaudited)
Three months Ended Three months Ended
December 31, December 31,
1995 1994
_________ _________
<S> <C> <C>
CASH FLOWS PROVIDED (USED)
BY OPERATING ACTIVITIES $ (241,148) $ (804,878)
_________ _________
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property and equipment (125,450) (176,908)
Purchase of Intelligraphics (4,552,758) -
_________ _________
Net cash used in investing activities (4,678,208) (176,908)
_________ _________
CASH FLOWS FROM FINANCING ACTIVITIES
Net borrowings (payments) under notes payable 300,000 600,000
Proceeds from issuance of long-term debt 3,498,738 168,829
Principal payments of long-term debt (104,921) (158,365)
Proceeds from issuance of common stock 895,438 162,561
________ _________
Net cash provided (used)
by financing activities 4,589,255 773,025
_________ _________
Net increase (decrease) in cash (330,101) (208,761)
Cash at beginning of period 665,274 552,232
_________ _________
Cash at end of period $ 335,173 $ 343,471
========= =========
Supplemental cash flow disclosures:
Interest paid $ 18,320 $ 30,717
========= =========
Income taxes paid $ 4,455 $ 328,800
========= =========
<FN>
See accompanying notes to financial statements.
</TABLE>
<PAGE>
Notes to Financial Statements
(Unaudited)
1. Summary of Significant Accounting Policies
The accompanying interim financial statements have been prepared
by management in accordance with the accounting policies
described in the Company's annual report for the year ended
September 30, 1995. They have not been audited by independent
auditors.
The financial statements reflect all adjustments which are, in
the opinion of management, necessary to present fairly the
financial position of Analytical Surveys, Inc., at December 31,
1995 and its results of operations for the three months ended
December 31, 1995 and 1994, and its cash flows for the three
months ended December 31, 1995 and 1994. All such adjustments are
of a normal recurring nature.
The computation of earnings per common share is based on the
weighted average number of shares outstanding plus common stock
equivalents as follows:
Three months ended December 31, 1995 3,104,000
Three months ended December 31, 1994 2,935,000
2. Notes Payable to Bank
Effective December 20, 1995, the Company renewed its line of
credit loan agreement with its existing bank for one year and
increased the maximum loan amount to $1,850,000. The interest
rate is 0.5 percent above the bank's published prime lending rate
and is variable with changes in that prime rate.
On December 22, 1995, the Company borrowed $3,430,000 from a bank
to fund substantially all of the cash portion of the purchase
price of the acquisition described in note 3 below. The debt is
to be repaid in monthly installments of $56,062 in the first year
increasing to $57,356 in the fourth year. A final payment of
$1,685,552 will be due at the end of the fourth year. Interest on
this term debt is 0.6 percent above the bank's published prime
lending rate and is variable with changes in that prime rate.
3. Acquisition
On December 22, 1995 the Company acquired substantially all of
the net operating assets of Intelligraphics Inc. of Waukesha,
Wisconsin. The business operates as a division of the Company
under the name of Intelligraphics International, a division of
Analytical Surveys, Inc., is in substantially the same line of
business as the Company and had sales of approximately $8,000,000
in calendar year 1995. Intelligraphics serves the utilities
market with emphasis on electric distribution and telephone data
conversion.
The acquisition was recorded using the purchase method of
accounting, and the accompanying income statement includes the
operations of Intelligraphics from the date of acquisition,
December 22, 1995 through the end of the period, December 31,
1995. The effect on operations for this brief period was not
significant. The December 31, 1995 balance sheet includes all of
the assets and liabilities of the new division.
The $4,552,758 consideration paid for the net assets acquired and
related acquisition costs consisted of cash in the amount of
$3,661,508 plus 230,000 shares of Analytical Surveys, Inc. no par
value common stock, which shares are subject to restrictions on
both transfer and voting rights for a period of two years. These
restricted shares were recorded at $3.875 per share reflecting
the effect of the restrictions on the fair market value of the
shares.
The acquisition included goodwill valued at $3,146,000 which will
be amortized over a 15 year life using the straight line method.
A portion of the consideration paid ($250,000 plus 70,000 of the
restricted shares) is being held in escrow awaiting the
satisfactory conclusion of certain pending matters.
4. Stock Options
The following table summarizes stock option transactions under the Company's
four non-qualified stock option plans:
<TABLE>
<CAPTION>
Shares Average
under Option Price
option per share
_________ _________
<S> <C> <C>
Outstanding at September 30, 1995 711,275
Issued 4,000 $ 7.97
Exercised (2,750) 3.83
Canceled (6,750) 3.96
_________
Outstanding December 31, 1995 705,775
=========
At December 31, 1995:
Options Exercisable 356,900
Available for Grant 203,975
=========
</TABLE>
<PAGE>
Part I Item 2.
Management's Discussion and Analysis of
Financial Condition and Results of Operations
Results of Operations:
Three Months Ended December 31, 1995
Net income (all from continuing operations) for the three months
ended December 31, 1995 of $275,218 was 103% higher than the same
period of the previous year. Increased production caused sales to
increase 25% and earnings from operations to increase 86% for the
first quarter of fiscal year 1995 over the same period of the
previous year. Salaries, wages and benefits increased 24% over
last year as the result of the production volume increases.
Increased subcontractor costs reflect increased production by
subcontractors. The 5% increase in general and administrative
expenses was primarily the result of increased activity in
selling, marketing, research and development. Interest expense
was 17% less than the same quarter of the previous year due to
reduction of debt, including capitalized leases, through
scheduled repayments.
The Intelligraphics acquisition described in note 3 to the
financial statements did not significantly affect the results of
operations for the three months ended December 31, 1995 because
there were only four business days in the period from the
acquisition date to the end of the quarter. Future quarters will
be affected by the Intelligraphics division, and the
December 31, 1995 balance sheet includes all of the new
division's assets and liabilities.
Cash flow used by operations in the three months ended December
31, 1995 was $241,150 compared to net cash used by operations of
$804,878 in the same three months of the previous year. Increased
production led to an expected increased investment in unbilled
revenues and accounts receivable. The trend to increased unbilled
revenue and accounts receivable is believed to be a normal
fluctuation. The Company maintains an open line of credit to
finance the investment in unbilled revenue and accounts
receivable.
Cash flow from investing activities includes the investment in
the net assets of the new Intelligraphics division plus equipment
acquisitions required by increased production in Colorado.
Cash flow from financing activities consists of the borrowing of
cash and the issuance of shares to finance the acquisition of
Intelligraphics as well as financing of equipment using capital
leases, the scheduled repayment of debt and capitalized leases
and proceeds from the exercise of stock options by employees.
The Company's backlog of contracted work increased to
approximately $23,000,000 at December 31, 1995 up more than 80%
from September 30, 1995 due to the addition of the
Intelligraphics backlog.
Liquidity and Capital Resources:
The Company maintains a line of credit with a bank to finance
short term cash requirements from time to time. The maximum loan
on this line of credit was increased from $1,250,000 to
$1,850,000 on December 20, 1995 to accommodate possible cash
needs arising from the Intelligraphics operation. A lease line of
credit of $800,000 was also established to finance capital
equipment acquisitions at both the Colorado and Wisconsin
locations.
Management expects to meet long-term liquidity requirements
through cash flows generated by operations supplemented from time
to time by short term borrowings on the bank line of credit.
Routine capital expenditures will usually be financed with term
debt and/or capital leases. The Company is dependent, however,
upon its ability to successfully deliver acceptable products in
order to maintain adequate operating cash flows.
The Company has not committed to significant capital expenditures
at December 31, 1995.
Part II Other Information
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
2. Plan of acquisition, reorganization, arrangement,
liquidation or succession:
2.1 Asset Purchase Agreement dated December 22, 1995
between Analytical Surveys, Inc. (buyer) and
Intelligraphics, Inc.(seller) and A. William Huelsman.
(Incorporated by reference to form 8-K filed
January 8, 1996)
2.2 Voting Trust Agreement dated December 22, 1995, between
Analytical Surveys, Inc., a Colorado Corporation, A.
William Huelsman, Gary Miller, William Nantell, David
Coates, David Kroes, Randy Vanek and Hamid Akhavan
(each a "Shareholder" and John A. Thorpe, Sidney V.
Corder, William H. Hudson, Richard P. MacLeod, James T.
Rothe, Robert H. Keeley and Willem H. J. Anderson,
(each an "Individual Trustee" and collectively, the
"Trustee"). (Incorporated by reference to form 8-K
filed January 8, 1996).
2.3 Lock-Up Agreement made as of December 22, 1995, by and
among A. William Huelsman, Gary Miller, William
Nantell, David Coates, David Kroes, Randy Vanek and
Hamid Akhavan (each a "Shareholder" and collectively,
the "Shareholders"), and Analytical Surveys, Inc., a
Colorado corporation (the "Company"). (Incorporated by
reference to form 8-K filed January 8, 1996)
2.4 Arbitration Agreement (this "Agreement") is made as of
December 22, 1995, among Analytical Surveys, Inc., a
Colorado corporation ("ASI"), Intelligraphics, Inc., a
Wisconsin corporation ("Intelligraphics"), A. William
Huelsman, Gary Miller, William Nantell, David Coates,
David Kroes, Randy Vanek and Hamid Akhavan (each a
"Shareholder" and collectively, the "Shareholders"),
Joanne Huelsman, James Carpenter, Bank One, Colorado,
NA ("Escrow Agent") and the members of the board of
directors of ASI who are voting trustees under the
Voting Trust Agreement ("Trustee"). (Incorporated by
reference to form 8-K filed January 8, 1996)
10. Material Contracts
10.1 Business Loan Agreement dated December 20, 1995.
10.2 Promissory Note - Term Debt, dated December 20, 1995
10.3 Promissory Note - Line of Credit, dated December 20,
1995
10.4 Building Lease dated December 3, 1993, amended
August 11, 1995
10.5 Building Lease dated June 1, 1995, amended
August 11, 1995
10.6 Building Lease dated August 10, 1995, amended
August 11, 1995
10.7 Employment agreement William Nantell dated
December 22, 1995
27. Financial Data Schedule
(b) Reports on Form 8-K
No reports on Form 8-K were filed during the three
months ended December 31, 1995. A report on Form 8-K
was filed January 8, 1996: Item 7. Acquisition of
Disposition of Assets reporting the acquisition of the
net assets of Intelligraphics, Inc. on December 22,
1995.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned thereunto duly authorized.
Analytical Surveys, Inc.
(Registrant)
Date February 14, 1996 /s/ Sidney V. Corder
________________________
Sidney V, Corder, President
and Chief Executive Officer
Date February 14, 1996 /s/ Scott C. Benger
________________________
Scott C. Benger, Secretary/Treasurer
(principal financial officer and
principal accounting officer)
Date February 14, 1996 /s/ Brian J. Yates
________________________
Brian J. Yates, Controller
BUSINESS LOAN AGREEMENT
Principal Loan Date Maturity Loan No Call Collateral
$3,430.000.00 12/20/95 02/29/2000
Account Officer Initials
176857108 048
References in the shaded area are for Lender's use only and do not limit
the applicability of this document to any particular loan or item.
Borrower: ANALYTICAL SURVEYS, INC., A COLORADO CORPORATION
1935 JAMBOREE DRIVE
COLORADO SPRINGS, CO 80920
Lender:BANK ONE, COLORADO, N.A.
Colorado Springs Banking Center
2696 South Colorado Blvd.
DENVER , CO 80222
THIS BUSINESS LOAN AGREEMENT between ANALYTICAL SURVEYS, INC., A COLORADO
CORPORATION ("Borrower") and BANK ONE, COLORADO, N.A. ("Lender") is made
and executed on the following terms and conditions. Borrower has received
prior commercial loans from Lender or has applied to Lender for a
commercial loan or loans and other financial accommodations, including
those which may be described on any exhibit or schedule attached to this
Agreement. All such loans and financial accommodations, together with all
future loans and financial accommodations from Lender to Borrower, are
referred to in this Agreement individually as the "Loan" and collectively
as the "Loans". Borrower understands and agrees that: (a) in granting,
renewing, or extending any Loan, Lender is relying upon Borrower's
representations, warranties, and agreements, as set forth in this
Agreement; (b) the granting, renewing, or extending of any Loan by Lender
at all times shall be subject to Lender's sole judgment and discretion; and
(c) all such Loans shall be and shall remain subject to the following terms
and conditions of this Agreement.
TERM. This Agreement shall be effective as of December 20, 1995, and shall
continue thereafter until all Indebtedness of Borrower to Lender has been
performed in full and the parties terminate this Agreement in writing.
DEFINITIONS. The following words shall have the following meanings when
used in this Agreement. Terms not otherwise defined in this Agreement
shall have the meanings attributed to such terms in the Uniform Commercial
Code. All references to dollar amounts shall mean amounts in lawful money
of the United States of America.
Agreement. The word "Agreement" means this Business Loan Agreement, as
this Business Loan Agreement may be amended or modified from time to time,
together with all exhibits and schedules attached to this Business Loan
Agreement from time to time.
Borrower. The word "Borrower" means ANALYTICAL SURVEYS, INC., A COLORADO
CORPORATION. The word "Borrower" also includes, as applicable, all
subsidiaries and affiliates of Borrower as provided below in the paragraph
titled "Subsidiaries and Affiliates."
CERCLA. The word "CERCLA" means the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, as amended.<PAGE>
Cash Flow. The words "Cash Flow" mean net income after taxes, and exclusive
of extraordinary gains and income, plus depreciation and amortization.
Collateral. The word "Collateral" means and includes without limitation
all property and assets granted as collateral security for a Loan, whether
real or personal property, whether granted directly or indirectly, whether
granted now or in the future, and whether granted in the form of a security
interest, mortgage, deed of trust, assignment, pledge, chattel mortgage,
chattel trust, factor's lien, equipment trust, conditional sale, trust
receipt, lien, charge, lien or title retention contract, lease or
consignment intended as a security device, or any other security or lien
interest whatsoever, whether created by law, contract, or otherwise.
Debt. The word "Debt" means all of Borrower's liabilities excluding
Subordinated Debt.
ERISA. The word "ERISA" means the Employee Retirement Income Security Act
of 1974, as amended.
Event of Default. The words "Event of Default" mean and include any of the
Events of Default set forth below in the section titled "EVENTS OF
DEFAULT."
Grantor. The word "Grantor" means and includes each and all of the persons
or entitles granting a Security Interest in any Collateral for the
Indebtedness, including without limitation all Borrowers granting such a
Security Interest.
Guarantor. The word "Guarantor" means and includes without limitation each
and all of the guarantors, sureties, and accommodation parties in
connection with any Indebtedness.
Indebtedness. The word "Indebtedness" means and includes without
limitation all Loans, together with all other obligations, debts and
liabilities of Borrower to Lender, or any one or more of them, as well as
all claims by Lender against Borrower, or any one or more of them; whether
now or hereafter existing, voluntary or involuntary , due or not due,
absolute or contingent, liquidated or unliquidated; whether Borrower may be
liable individually or jointly with others; whether Borrower may be
obligated as a guarantor, surety, or otherwise; whether recovery upon such
Indebtedness may be or hereafter may become barred by any statute of
limitations; and whether such indebtedness may be or hereafter may become
otherwise unenforceable.
Lender. The word "Lender" means BANK ONE, COLORADO, N.A., its successors
and assigns.
Liquid Assets. The words "Liquid Assets" mean Borrower's cash on hand plus
Borrower's receivables.
Loan. The word "Loan" or "Loans" means and includes without limitation any
and all commercial loans and financial accommodations from Lender to
Borrower, whether now or hereafter existing, and however evidenced,
including without limitation those loans and financial accommodations
described herein or described on any exhibit or schedule attached to this
Agreement from time to time.
Note. The word "Note" means and includes without limitation Borrower's
promissory note or notes, if any, evidencing Borrower's Loan obligations in
favor of Lender, as well as any substitute, replacement or refinancing note
or notes therefor.
Permitted Liens. The words "Permitted Liens" mean: (a) liens and security
interests securing Indebtedness owed by Borrower to Lender; (b) liens for
taxes, assessments, or similar charges either not yet due or being
contested in good faith; (c) liens of materialmen, mechanics, warehousemen,
or carriers, or other like liens arising in the ordinary course of business
and securing obligations which are not yet delinquent; (d) purchase money
liens or purchase money security interests upon or in any property acquired
or held by Borrower in the ordinary course of business to secure
indebtedness outstanding on the date of this Agreement or permitted to be
incurred under the paragraph of this Agreement titled "Indebtedness and
Liens"; (e) liens and security interests which, as of the date of this
Agreement, have been disclosed to and approved by the Lender in writing;
and (f) those liens and security interests which in the aggregate
constitute an immaterial and insignificant monetary amount with respect to
the net value of Borrower's assets.
Related Documents. The words "Related Documents" mean and include without
limitation all promissory notes, credit agreements, loan agreements,
environmental agreements, guaranties, security agreements, mortgages, deeds
of trust, and all other instruments, agreements and documents, whether now
or hereafter existing, executed in connection with the Indebtedness.
Security Agreement. The words "Security Agreement" mean and include
without limitation any agreements, promises, covenants, arrangements,
understandings or other agreements, whether created by law, contract, or
otherwise, evidencing, governing, representing, or creating a Security
Interest.
Security Interest. The words "Security Interest" mean and include without
limitation any type of collateral security, whether in the form of a lien,
charge, mortgage, deed of trust, assignment, pledge, chattel mortgage,
chattel trust, factor's lien, equipment trust, conditional sale, trust
receipt, lien or title retention contract, lease or consignment intended as
a security device, or any other security or lien interest whatsoever,
whether created by law, contract, or otherwise.
SARA. The word "SARA" means the Superfund Amendments and Reauthorization
Act of 1986 as now or hereafter amended.
Subordinated Debt. The words "Subordinated Debt" mean indebtedness and
liabilities of Borrower which have been subordinated by written agreement
to indebtedness owed by Borrower to Lender in form and substance acceptable
to Lender.
Tangible Net Worth. The words "Tangible Net Worth" mean Borrower's total
assets excluding all intangible assets (i.e., goodwill, trademarks,
patents, copyrights, organizational expenses, and similar intangible items,
but including leaseholds and leasehold improvements) less total Debt.
Working Capital. The words "Working Capital" mean Borrower's current
assets, excluding prepaid expenses, less Borrower's current liabilities.
CONDITIONS PRECEDENT TO EACH ADVANCE. Lender's obligation to make the
initial Loan Advance and each subsequent Loan Advance under this Agreement
shall be subject to the fulfillment to Lender's satisfaction of all of the
conditions set forth in this Agreement and in the Related Documents.<PAGE>
Loan Documents. Borrower shall provide to Lender in form satisfactory to
Lender the following documents for the Loan: (a) the Note, (b) Security
Agreements granting to Lender security interests in the Collateral, (c)
Financing Statements perfecting Lender's Security Interests; (d) evidence
of insurance as required below; and (e) any other documents required under
this Agreement or by Lender of its counsel, including without limitation
any assignments of life insurance described below.
Borrower's Authorization. Borrower shall have provided in form and
substance satisfactory to Lender properly certified resolutions, duly
authorizing the execution and delivery of this Agreement, the Note and the
Related Documents, and such other authorizations and other documents and
instruments as Lender or its counsel, in their sole discretion, may
require.
Payment of Fees and Expenses. Borrower shall have paid to Lender all fees,
charges, and other expenses which are then due and payable as specified in
this Agreement or any Related Document.
Representations and Warranties. The representations and warranties set
forth in this Agreement, in the Related Documents, and in any document of
certificate delivered to Lender under this Agreement are true and correct.
No Event of Default. There shall not exist at the time of any advance a
condition which would constitute an Event of Default under this Agreement
REPRESENTATIONS AND WARRANTIES. Borrower represents and warrants to Lender
as of the date of this Agreement, as of the date of each disbursement of
Loan proceeds, as of the date of any renewal, extension or modification of
any Loan, and at all times any Indebtedness exists:
Organization. Borrower is a corporation which is duly organized, validly
existing, and in good standing under the laws of the state of Borrower's
incorporation and is validly existing and in good standing in all states in
which Borrower is doing business. Borrower has the full power and authority
to own its properties and to transact the businesses in which it is
presently engaged or presently proposes to engage. Borrower also is duly
qualified as a foreign corporation and is in good standing in all states in
which the failure to so qualify would have a material adverse effect on its
businesses or financial condition.
Authorization. The execution, delivery, and performance of this Agreement
and all Related Documents by Borrower, to the extent to be executed,
delivered or performed by Borrower, have been duly authorized by all
necessary action by Borrower; do not require the consent or approval of any
other person, regulatory authority or governmental body; and do not
conflict with, result in a violation of, or constitute a default under (a)
any provision of its articles of incorporation or organization, or bylaws,
or any agreement or other instrument binding upon Borrower or (b) any law,
governmental regulation, court decree, or order applicable to Borrower.
Financial Information. Each financial statement of Borrower supplied to
Lender truly and completely disclosed Borrower's financial condition as of
the date of the statement, and there has been no material adverse change in
Borrower's financial condition subsequent to the date of the most recent
financial statement supplied to Lender. Borrower has no material
contingent obligations except as disclosed in such financial statements.
Legal Effect. This Agreement constitutes, and any instrument or agreement
required hereunder to be given by Borrower when delivered will constitute,
legal, valid and binding obligations of Borrower enforceable against
Borrower in accordance with their respective terms.
Properties. Except as contemplated by this Agreement or as previously
disclosed in Borrower's financial statements or in writing to Lender and as
accepted by Lender, and except for property tax liens for taxes not
presently due and payable, Borrower owns and has good title to all of
Borrower's properties free and clear of all Security Interests, and has not
executed any security documents or financing statements relating to such
properties. All of Borrower's properties are titled in Borrower's legal
name, and Borrower has not used, or filed a financing statement under, any
other name for at least the last five (5) years.
Hazardous Substances. The terms "hazardous waste," "hazardous substance,"
"disposal," "release," and "threatened release," as used in this Agreement,
shall have the same meanings as set forth in the "CERCLA," "SARA," the
Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et seq.,
the Resource Conservation and Recovery Act, 49 U.S.C. Section 6901, et
seq., or other applicable state or Federal laws, rules, or regulations
adopted pursuant to any of the foregoing. Except as disclosed to and
acknowledged by Lender in writing, Borrower represents and warrants that:
(a) During the period of Borrower's ownership of the properties, there has
been no use, generation, manufacture, storage, treatment, disposal, release
or threatened release of any hazardous waste or substance by any person on,
under, about or from any of the properties. (b) Borrower has no knowledge
of, or reason to believe that there has been (i) any use, generation,
manufacture, storage, treatment, disposal, release, or threatened release
of any hazardous waste or substance on, under, about or from the properties
by any prior owners or occupants of any of the properties, or (ii) any
actual or threatened litigation or claims of any kind by any person
relating to such matters. (c) Neither Borrower nor any tenant, contractor,
agent or other authorized user of any of the properties shall use,
generate, manufacture, store, treat, dispose of, or release any hazardous
waste or substance on, under, about or from any of the properties; and any
such activity shall be conducted in compliance with all applicable federal,
state, and local laws, regulations, and ordinances, including without
limitation those laws, regulations and ordinances described above.
Borrower authorizes Lender and its agents to enter upon the properties to
make such inspections and tests as Lender may deem appropriate to determine
compliance of the properties with this section of the Agreement. Any
inspections or tests made by Lender shall be for Lender's purposes only and
shall not be construed to create any responsibility or liability on the
part of Lender to Borrower or to any other person. The representations and
warranties contained herein are based on Borrower's due diligence in
investigating the properties for hazardous waste and hazardous substances.
Borrower hereby (a) releases and waives any future claims against Lender
for indemnity or contribution in the event Borrower becomes liable for
cleanup or other costs under any such laws, and (b) agrees to indemnify and
hold harmless Lender against any and all claims, losses, liabilities,
damages, penalties, and expenses which Lender may directly or indirectly
sustain or suffer resulting from a breach of this section of the Agreement
or as a consequence of any use, generation, manufacture, storage, disposal,
release or threatened release occurring prior to Borrower's ownership or
interest in the properties, whether or not the same was or should have been
known to Borrower. The provisions of this section of the Agreement,
including the obligation to indemnify, shall survive the payment of the
Indebtedness and the termination or expiration of this Agreement and shall
not be affected by Lender's acquisition of any interest in any of the
properties, whether by foreclosure or otherwise.
Litigation and Claims. No litigation, claim, investigation, administrative
proceeding or similar action (including those for unpaid taxes) against
Borrower is pending or threatened, and no other event has occurred which
may materially adversely affect Borrower's financial condition or
properties, other than litigation, claims, or other events, if any, that
have been disclosed to and acknowledged by Lender in writing.
Taxes. To the best of Borrower's knowledge, all tax returns and reports of
Borrower that are or were required to be filed, have been filed, and all
taxes, assessments and other governmental charges have been paid in full,
except those presently being or to be contested by Borrower in good faith
in the ordinary course of business and for which adequate reserves have
been provided.
Lien Priority. Unless otherwise previously disclosed to Lender in writing,
Borrower has not entered into or granted any Security Agreements, or
permitted the filing or attachment of any Security Interests on or
affecting any of the Collateral directly or indirectly securing repayment
of Borrower's Loan and Note, that would be prior or that may in any way be
superior to Lender's Security Interests and rights in and to such
Collateral.
Binding Effect. This Agreement, the Note, all Security Agreements directly
or indirectly securing repayment of Borrower's Loan and Note and all fo the
Related Documents are binding upon Borrower as well as upon Borrower's
successors, representatives and assigns, and are legally enforceable in
accordance with their respective terms.
Commercial Purposes. Borrower intends to use the Loan proceeds solely for
business or commercial related purposes.
Employee Benefit Plans. Each employee benefit plan as to which Borrower
may have any liability complies in all material respects with all
applicable requirements of law and regulations, and (i) no Reportable Event
nor Prohibited Transaction (as defined in ERISA) has occurred with respect
to any such plan, (ii) Borrower has not withdrawn from any such plan or
initiated steps to do so, and (iii) no steps have been taken to terminate
any such plan.
Location of Borrower's Offices and Records. Borrower's place of business,
or Borrower's Chief executive office, if Borrower has more than one place
of business, is located at 1935 JAMBOREE DRIVE, COLORADO SPRINGS, CO
80920. Unless Borrower has designated otherwise in writing this location is
also the office or offices where Borrower keeps its records concerning the
Collateral.
Information. All information heretofore or contemporaneously herewith
furnished by Borrower to Lender for the purposes of or in connection with
this Agreement or any transaction contemplated hereby is, and all
information hereafter furnished by or on behalf of Borrower to Lender will
be, true and accurate in every material respect on the date as of which
such information is dated or certified; and none of such information is or
will be incomplete by omitting to state any material fact necessary to make
such information not misleading.
Survival of Representation and Warranties. Borrower understands and agrees
that Lender, without independent investigation, is relying upon the above
representations and warranties in making the above referenced Loan to
Borrower. Borrower further agrees that the foregoing representations and
warranties shall be continuing in nature and shall remain in full force and
effect until such time as Borrower's Indebtedness shall be paid in full, or
until this Agreement shall be terminated in the manner provided above,
whichever is the last to occur.
AFFIRMATIVE COVENANTS. Borrower covenants and agrees with Lender that,
while this Agreement is in effect, Borrower will:
Litigation. Promptly inform Lender in writing of (a) all material adverse
changes in Borrower's financial condition, and (b) all existing and all
threatened litigation, claims, investigations, administrative proceedings
or similar actions affecting Borrower or any Guarantor which could
materially affect the financial condition of Borrower or the financial
condition of any Guarantor.
Financial Records. Maintain its books and records in accordance with
generally accepted accounting principles, applied on a consistent basis,
and permit Lender to examine and audit Borrower's books and records at all
reasonable times.
Financial Statements. Furnish Lender with, as soon as available, but in no
event later than ninety (90) days after the end of each fiscal year,
Borrower's balance sheet and income statement for the year ended, audited
by a certified public accountant satisfactory to Lender. All financial
reports required to be provided under this Agreement shall be prepared in
accordance with generally accepted accounting principles, applied on a
consistent basis, and certified by Borrower as being true and correct.
Additional Information. Furnish such additional information and
statements, lists of assets and liabilities, agings of receivables and
payables, inventory schedules, budgets, forecasts, tax returns, and other
reports with respect to Borrower's financial condition and business
operations as Lender may request from time to time.
Financial Covenants and Ratios. Comply with the following covenants and
ratios:
Net Worth Ratio. Maintain a ratio of Total Liabilities to Tangible Net
Worth of less than 2.15 to 1.00 thru 5/31/96 then 2.00 to 1.00 thru 8/31/96
then 1.85 to 1.00 thereafter.
Current Ratio. Maintain a ratio of Current Assets to Current Liabilities
in excess of 1.80 to 1.00. Except as provided above, all computations made
to determine compliance with the requirements contained in this paragraph
shall be made in accordance with generally accepted accounting principles,
applied on a consistent basis, and certified by Borrower as being true and
correct.
Insurance. Maintain fire and other risk insurance, public liability
insurance, and such other insurance as Lender may require with respect to
Borrower's properties and operations, in form, amounts, coverages and with
insurance companies reasonably acceptable to Lender. Borrower, upon
request of Lender, will deliver to Lender from time to time the policies or
certificates of insurance in form satisfactory to Lender, including
stipulations that coverages will not be canceled or diminished without at
least ten (10) days' prior written notice to Lender. In connection with
all policies covering assets in which Lender holds or is offered a security
interest for the Loans, Borrower will provide Lender with such loss payable
or other endorsements as Lender may require.
Insurance Reports. Furnish to Lender, upon request of Lender, reports on
each existing insurance policy showing such information as Lender may
reasonably request, including without limitation the following: (a) the
name of the insurer; (b) the risks insured; (c) the amount of the policy;
(d) the properties insured; (e) the then current property values on the
basis of which insurance has been obtained, and the manner of determining
those values; and (f) the expiration date of the policy.
Life Insurance. As soon as practical, obtain and maintain life insurance
in form and with insurance companies reasonably acceptable to Lender on the
following individual in the amount indicated below and, at Lender's option,
cause such insurance coverage to be pledged, made payable to, or assigned
to Lender on Lender's forms. Lender, at its discretion, may apply the
proceeds of any insurance policy to the unpaid balances of any
indebtedness:
Name of Insured Amount
JOHN A. THORPE $500,000.00
Other Agreements. Comply with all terms and conditions of all other
agreements, whether now or hereafter existing, between Borrower and any
other party and notify Lender immediately in writing of any default in
connection with any other such agreements.
Loan Proceeds. Use all Loan proceeds solely for Borrower's business
operations, unless specifically consented to the contrary by Lender in
writing.
Taxes, Charges and Liens. Pay and discharge when due all of its
indebtedness and obligations, including without limitation all assessments,
taxes, governmental charges, levies and liens, of every kind and nature,
imposed upon Borrower or its properties, income, or profits, prior to the
date on which penalties would attach, and all lawful claims that, if
unpaid, might become a lien or charge upon any of Borrower's properties,
income, or profits. Provided however, Borrower will not be required to pay
and discharge any such assessment, tax, charge, levy, lien or claim so long
as (a) the legality of the same shall be contested in good faith by
appropriate proceedings, and (b) Borrower shall have established on its
books adequate reserves with respect to such contested assessment, tax,
charge, levy, lien, or claim in accordance with generally accepted
accounting practices. Borrower, upon demand of Lender, will furnish to
Lender evidence of payment of the assessments, taxes, charges, levies,
liens and claims and will authorize the appropriate governmental official
to deliver to Lender at any time a written statement of any assessments,
taxes, charges, levies, liens and claims against Borrower's properties,
income, or profits.
Performance. Perform and comply with all terms, conditions, and provisions
set forth in this Agreement and in the Related Documents in a timely
manner, and promptly notify Lender if Borrower learns of the occurrence of
any event which constitutes an Event of Default under this Agreement or
under any of the Related Documents.
Operations. Maintain executive and management personnel with substantially
the same qualifications and experience as the present executive and
management personnel; provide written notice to Lender of any change in
executive and management personnel; conduct its business affairs in a
reasonable and prudent manner and in compliance with all applicable
federal, state and municipal laws, ordinances, rules and regulations
respecting its properties, charters, businesses and operations, including
without limitation, compliance with the Americans With Disabilities Act and
with all minimum funding standards and other requirements of ERISA and
other laws applicable to Borrower's employee benefit plans.
Inspection. Permit employees or agents of Lender at any reasonable time
during normal business hours to inspect any and all Collateral for the Loan
or Loans and Borrower's other properties and to examine or audit Borrower's
books, accounts, and records and to make copies and memoranda of Borrower's
books, accounts, and records. If Borrower now or at any time hereafter
maintains any records (including without limitation computer generated
records and computer software programs for the generation of such records)
in the possession of a third party, Borrower, upon request of Lender, shall
notify such party to permit Lender free access to such records at all
reasonable times and to provide Lender with copies of any records it may
request, all at Borrower's expense, subject to confidentiality
requirements.
Compliance Certificate. Unless waived in writing by Lender, provide Lender
ANNUALLY with a certificate executed by Borrower's chief financial officer,
or other officer or person acceptable to Lender, certifying that the
representations and warranties set forth in this Agreement are true and
correct as of the date of the certificate and further certifying that, as
of the date of the certificate, no Event of Default exists under this
Agreement.
Environmental Compliance and Reports. Borrower shall comply in all
respects with all environmental protection federal, state and local laws,
statutes, regulations and ordinances; not cause or permit to exist, as a
result of an intentional or unintentional action or omission on its part or
on the part of any third party, on property owned and/or occupied by
Borrower, any environmental activity where damage may result to the
environment, unless such environmental activity is pursuant to and in
compliance with the conditions of a permit issued by the appropriate
federal, state or local government authorities; shall furnish to Lender
promptly and in any event within thirty (30) days after receipt thereof a
copy of any notice, summons, lien, citation, directive, letter or other
communication from any governmental agency or instrumentality concerning
any intentional or unintentional action or omission on Borrower's part in
connection with any environmental activity whether or not there is damage
to the environment and/or other natural resources.
Additional Assurances. Make, execute and deliver to Lender such promissory
notes, mortgages, deeds of trust, security agreements, financing
statements, instruments, documents and other agreements as Lender or its
attorneys may reasonably request to evidence and secure the Loans and to
perfect all Security Interests.
NEGATIVE COVENANTS. Borrower covenants and agrees with Lender that while
this Agreement is in effect, Borrower shall not, without the prior written
consent of Lender: Which shall not be unreasonable withheld and shall be
deemed given if not denied within ten (10) business days after receipt of
written request from Borrower for Lenders consent.
Indebtedness and Liens. (a) Except for trade debt incurred in the normal
course of business and indebtedness to Lender contemplated by this
Agreement, create, incur or assume indebtedness for borrowed money,
including capital leases, (b) except as allowed as a Permitted Lien, sell,
transfer, mortgage, assign, pledge, lease, grant a security interest in, or
encumber any of Borrower's assets, or which are collateral for the loan,
(c) sell with recourse any of Borrower's accounts, except to Lender.
Continuity of Operations. (a) Engage in any business activities
substantially different than those in which Borrower is presently engaged,
(b) cease operations, liquidate, merge, transfer, acquire or consolidate
with any other entity, change ownership, change its name, dissolve or
transfer or sell Collateral out of the ordinary course of business, (c)
purchase or retire any of Borrower's outstanding shares or alter or amend
Borrower's capital structure.
Loans, Acquisitions and Guaranties. (a) Loan, invest in or advance money
or assets, (b) purchase, create or acquire any interest in any other
enterprise or entity, or (c) incur any obligation as surety or guarantor
other than in the ordinary course of business.
CESSATION OF ADVANCES. If Lender has made any commitment to make any Loan
to Borrower, whether under this Agreement or under any other agreement,
Lender shall have no obligation to make Loan Advances or to disburse Loan
proceeds if: (a) Borrower or any Guarantor is in default under the terms of
this Agreement or any of the Related Documents or any other agreement that
Borrower or any Guarantor has with Lender; (b) Borrower or any Guarantor
becomes insolvent, files a petition in bankruptcy or similar proceedings,
or is adjudged a bankrupt; (c) there occurs a material adverse change in
Borrower's financial condition, in the financial condition of any
Guarantor, or in the value of any Collateral securing any Loan; or (d) any
Guarantor seeks, claims or otherwise attempts to limit, modify or revoke
such Guarantor's guaranty of the Loan or any other loan with Lender.
ACCOUNTS RECEIVABLE AGINGS. BORROWER SHALL FURNISH TO LENDER A LISTING AND
AGING OF ALL ACCOUNTS RECEIVABLE WITHIN 30 DAYS OF EACH QUARTER END.
EXHIBIT "A". An exhibit, titled "EXHIBIT "A"," is attached to this
Agreement and by this reference is made a part of this Agreement just as if
all the provisions, terms and conditions of the Exhibit had been fully set
forth in this Agreement.
EXHIBIT "B". An exhibit, titled "EXHIBIT "B"," is attached to this
Agreement and by this reference is made apart of this Agreement just as if
all the provisions, terms and conditions of the Exhibit had been fully set
forth in this Agreement.
RIGHT OF SETOFF. Borrower grants to Lender a contractual possessory
security interest in, and hereby assigns, conveys, delivers, pledges, and
transfers to Lender all Borrower's right, title and interest in and to,
Borrower's accounts with Lender (whether checking, savings, or some other
account), including without limitation all accounts held jointly with
someone else and all accounts Borrower may open in the future, excluding
however all IRA, Keogh, and trust accounts. Borrower authorizes Lender, to
the extent permitted by applicable law, to charge or setoff all sums owing
on the Indebtedness against any and all such accounts.
EVENTS OF DEFAULT. Each of the following shall constitute an Event of
Default under this Agreement:
Default on Indebtedness. Failure of Borrower to make any payment when due
on the Loans if not cured within three (3) business days after notice from
Lender.
Other Defaults. Failure of Borrower or any Grantor to comply with or to
perform when due any other term, obligation, covenant or condition
contained in this Agreement or in any of the Related Documents, or failure
of Borrower to comply with or to perform any other term, obligation,
covenant or condition contained in any other agreement between Lender and
Borrower.
Default in Favor of Third Parties. Should Borrower or any Grantor default
under any loan, extension of credit, security agreement, purchase or sales
agreement, or any other agreement, in favor of any other creditor or person
that may materially affect any of Borrower's property or Borrower's or any
Grantor's ability to repay the Loans or perform their respective
obligations under this Agreement or any of the Related Documents.
False Statements. Any warranty, representation or statement made or
furnished to Lender by or on behalf of Borrower or any Grantor under this
Agreement or the Related Documents is false or misleading in any material
respect at the time made or furnished, or becomes false or misleading at
any time thereafter.
Defective Collateralization. This Agreement or any of the Related
Documents ceases to be in full force and effect (including failure of any
Security Agreement to create a valid and perfected Security Interest) at
any time and for any reason.
Insolvency. The dissolution or termination of Borrower's existence as a
going business, the insolvency of Borrower, the appointment of a receiver
for any part of Borrower's property, any assignment for the benefit of
creditors, any type of creditor workout, or the commencement of any
proceeding under any bankruptcy or insolvency laws by or against Borrower.
Creditor or Forfeiture Proceedings. Commencement of foreclosure or
forfeiture proceedings, whether by judicial proceeding, self-help,
repossession or any other method, by any creditor of Borrower, any creditor
of any Grantor against any collateral securing the Indebtedness, or by any
governmental agency. This includes a garnishment, attachment, or levy on
or of any of Borrower's deposit accounts with Lender.
Events Affecting Guarantor. Any of the preceding events occurs with
respect to any Guarantor of any of the Indebtedness or any Guarantor dies
or becomes incompetent or revokes or disputes the validity of, or liability
under, any Guarantor of the Indebtedness.
Adverse Change. A material adverse change occurs in Borrower's financial
condition, or Lender believes the prospect of payment or performance of the
Indebtedness is impaired.
EFFECT OF AN EVENT OF DEFAULT. If any Event of Default shall occur, except
where otherwise provided in this Agreement or the Related Documents, all
commitments and obligations of Lender under this Agreement or the Related
Documents or any other agreement immediately will terminate, and, at
Lender's option, all Indebtedness immediately will become due and payable,
all without notice of any kind to Borrower, except that in the case of and
Event of Default of the type described in the "Insolvency" subsection
above, such acceleration shall be automatic and not optional. In addition,
Lender shall have all the rights and remedies provided in the Related
Documents or available at law, in equity, or otherwise. Except as may be
prohibited by applicable law, all of Lender's rights and remedies shall be
cumulative and may be exercised singularly or concurrently. Election by
Lender to pursue any remedy shall not exclude pursuit of any other remedy,
and an election to make expenditures or to take action to perform an
obligation of Borrower or of any Grantor shall not affect Lender's right to
declare a default and to exercise its rights and remedies.
MISCELLANEOUS PROVISIONS. The following miscellaneous provisions are a
part of this Agreement:
Amendments. This Agreement, together with any Related Documents,
constitutes the entire understanding and agreement of the parties as to the
matters set forth in this Agreement. No alteration of or amendment to this
Agreement shall be effective unless given in writing and signed by the
party or parties sought to be charged or bound by the alteration or
amendment.
APPLICABLE LAW. THIS AGREEMENT HAS BEEN DELIVERED TO LENDER AND ACCEPTED
BY LENDER IN THE STATE OF COLORADO IF THERE IS A LAWSUIT, BORROWER AGREES
UPON LENDER'S REQUEST TO SUBMIT TO THE JURISDICTION OF THE COURTS OF EL
PASO COUNTY, THE STATE OF COLORADO. LENDER AND BORROWER HEREBY WAIVE THE
RIGHT TO ANY JURY TRIAL IN ANY ACTION, PROCEEDING, OR COUNTERCLAIM BROUGHT
BY EITHER LENDER OR BORROWER AGAINST THE OTHER. THIS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
COLORADO.
Caption Headings. Caption headings in this Agreement are for convenience
purposes only and are not to be used to interpret or define the provisions
of this Agreement.
Multiple Parties; Corporate Authority. All obligations of Borrower under
this Agreement shall be joint and several, and all references to Borrower
shall mean each and every Borrower. This means that each of the Borrowers
signing below is responsible for ALL obligations in this Agreement.
Consent to Loan Participation. Borrower agrees and consents to Lender's
sale or transfer, whether now or later, of one or more participation
interests in the Loans to one or more purchasers, whether related or
unrelated to Lender. Lender may provide, without any limitation
whatsoever, to any one or more purchasers, or potential purchasers, any
information or knowledge Lender may have about Borrower or about any other
matter relating to the Loan, and Borrower hereby waives any rights to
privacy it may have with respect to such matters. Borrower additionally
waives any and all notices of sale of participation interests, as well as
all notices of any repurchase of such participation interests. Borrower
also agrees that the purchasers of any such participation interests will be
considered as the absolute owners of such interests in the Loans and will
have all the rights granted under the participation agreement or agreements
governing the sale of such participation interests.
Costs and Expenses. Borrower agrees to pay upon demand all of Lender's
out-of-pocket expenses, including reasonable attorneys' fees, incurred in
connection with the preparation, execution, enforcement, modification and
collection of this Agreement or in connection with the Loans made pursuant
to this Agreement. Lender may pay someone else to help collect the Loans
and to enforce this Agreement, and Borrower will pay that amount. This
includes, subject to any limits under applicable law, Lender's attorneys'
fees and Lender's legal expenses, whether or not there is a lawsuit,
including attorneys' fees for bankruptcy proceedings (including efforts to
modify or vacate any automatic stay or injunction), appeals, and any
anticipated post-judgment collection services. Borrower also will pay any
court costs, in addition to all other sums provided by law.
Notices. All notices required to be given under this Agreement shall be
given in writing, may be sent by telefacsimilie, and shall be effective
when actually delivered or when deposited with a nationally recognized
overnight courier or deposited in the United States mail, first class,
postage prepaid, addressed to the party to whom the notice is to be given
at the address shown above. Any party may change its address for notices
under this Agreement by giving formal written notice to the other parties,
specifying that the purpose of the notice is to change the party's address.
To the extent permitted by applicable law, if there is more than one
Borrower, notice to any Borrower will constitute notice to all Borrowers.
For notice purposes, Borrower agrees to keep Lender informed at all times
of Borrower's current address(es).
Severability. If a court of competent jurisdiction finds any provision of
this Agreement to be invalid or unenforceable as to any person or
circumstance, such finding shall not render that provision invalid or
unenforceable as to any other persons or circumstances. If feasible, any
such offending provision shall be deemed to be modified to be within the
limits of enforceability or validity; however, if the offending provision
cannot be so modified, it shall be stricken and all other provisions of
this Agreement in all other respects shall remain valid and enforceable.
Subsidiaries and Affiliates of Borrower. To the extent the context of any
provisions of this Agreement makes it appropriate, including without
limitation any representation, warranty or covenant, the word "Borrower" as
used herein shall include all subsidiaries and affiliates of Borrower.
Notwithstanding the foregoing however, under no circumstances shall this
Agreement be construed to require Lender to make any Loan or other
financial accommodation to any subsidiary or affiliate of Borrower.
Successors and Assigns. All covenants and agreements contained by or on
behalf of Borrower shall bind its successors and assigns and shall inure to
the benefit of Lender, its successors and assigns. Borrower shall not,
however, have the right to assign its rights under this Agreement or any
interest therein, without the prior written consent of Lender.
Survival. All warranties, representations, and covenants made by Borrower
in this Agreement or in any certificate or other instrument delivered by
Borrower to Lender under this Agreement shall be considered to have been
relied upon by Lender and will survive the making of the Loan and delivery
to Lender of the Related Documents, regardless of any investigation made by
Lender or on Lender's behalf.
Time is of the Essence. Time is of the essence in the performance of this
Agreement.
Waiver. Lender shall not be deemed to have waived any rights under this
Agreement unless such waiver is given in writing and signed by Lender. No
delay or omission on the part of Lender in exercising any right shall
operate as a waiver of such right or any other right. A waiver by Lender
of a provision of this Agreement shall not prejudice or constitute a waiver
of Lender's right otherwise to demand strict compliance with that provision
or any other provision of this Agreement. No prior waiver by Lender, nor
any course of dealing between Lender and Borrower, or between Lender and
any Grantor, shall constitute a waiver of any of Lender's rights or of any
obligation of Borrower or of any Grantor as to any future transactions.
Whenever the consent of Lender is required under this Agreement, the
granting of such consent by Lender in any instance shall not constitute
continuing consent in subsequent instances where such consent is required,
and in all cases such consent may be granted or withheld in the sole
discretion of Lender.
BORROWER ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS BUSINESS LOAN
AGREEMENT, AND BORROWER AGREES TO ITS TERMS. THIS AGREEMENT IS DATED AS OF
DECEMBER 20, 1995.
BORROWER:
ANALYTICAL SURVEYS INC., A COLORADO CORPORATION
BY:_____________________________BY:_/s/Sidney v. Corder_________
JOHN A.THORPE, Chairman SIDNEY V.CORDER, President
BY:_/s/Scott C. Benger__________
SCOTT C. BENGER, Vice President
LENDER:
BANK ONE, COLORADO, N.A.
BY:_/S/Thomas D. Young_________
Authorized Officer
___________________________________________________________________________
Additionally, this Business Loan Agreement includes the following:
Creditor or Forfeiture Proceedings. However, this Event of Default shall
not apply if there is a good faith dispute by Borrower or Grantor, as the
case may be, as to the validity or reasonableness of the claim which is the
basis of the creditor or forfeiture proceeding, and if Borrower or Grantor
gives Lender written notice of the creditor or forfeiture proceeding and
furnished reserves or a surety bond for the creditor or forfeiture
proceeding satisfactory to Lender.
Right to Cure. If any default, other than a Default on Indebtedness, is
curable and if Borrower or Grantor, as the case may be, has not been given
a notice of a similar default within the preceding twelve (12) months, it
may be cured (and no Event of Default will have occurred) if Borrower or
Grantor, as the case may be, after receiving written notice from Lender
demanding cure of such default: (a) cures the default within thirty (30)
days; or (b) if the cure requires more than thirty (30) days, immediately
initiates steps which Lender deems in Lender's sole discretion to be
sufficient to cure the default and thereafter continues and completes all
reasonable and necessary steps sufficient to produce compliance as soon as
reasonably practical.
Analytical Surveys, Inc., A Colorado Corporation
By:____________________________ By:_/s/Sidney V. Corder________
John A. Thorpe, Chairman Sidney V. Corder, President<PAGE>
By:_/s/Scott C. Benger___________
Scott C. Benger, Vice President
Lender:
Bank One, Colorado N.A.
By:__/s/ Thomas D. Young_______
Thomas D. Young, Sr. Vice President
PROMISSORY NOTE
Principal Loan Date Maturity Loan No Call
Collateral
$3,430.000.00 12/20/95 02/29/2000
Account Officer Initials
176857108 048
Borrower: ANALYTICAL SURVEYS, INC., A COLORADO CORPORATION
1935 JAMBOREE DRIVE
COLORADO SPRINGS, CO 80920
Lender: BANK ONE, COLORADO, N.A.
Colorado Springs Banking Center
2696 South Colorado Blvd.
DENVER , CO 80222
PROMISE TO PAY. ANALYTICAL SURVEYS, INC., A COLORADO CORPORATION
("Borrower") promises to pay to BANK ONE, COLORADO, N.A. ("Lender"), or
order, in lawful money of the United States of America, the principal
amount of Three Million Four Hundred Thirty Thousand & 00/100 Dollars
($3,340,000.00), together with interest on the unpaid principal balance
from December 20, 1995, until paid in full.
PAYMENT. Subject to any payment changes resulting from changes in the
Index, Borrower will pay this loan in accordance with the following payment
schedule:
11 consecutive monthly principal and interest payments in the initial
amount of $56,061.80 each, beginning January 29, 1996, with interest
calculated on the unpaid principal balances at an interest rate of 0.600
percentage points over the Index described below; 12 consecutive monthly
principal and interest payments in the initial amount of $56,629.72 each,
beginning December 29, 1996, with interest calculated on the unpaid
principal balances at an interest rate of 0.600 percentage points over the
Index described below; 26 consecutive monthly principal and interest
payments in the initial amount of $57,356.63 each, beginning December 29,
1997, with interest calculated on the unpaid balances at an interest rate
of 0.600 percentage points over the Index described below; and 1 principal
and interest payment in the initial amount of $1,685,552.37 on February 29,
2000, with interest calculated on the unpaid principal balances at an
interest rate of 0.600 percentage points over the Index described below.
This estimated final payment is based on the assumption that all payments
will be made exactly as scheduled and that the Index does not change; the
actual final payment will be for all principal and accrued interest not yet
paid, together with any other unpaid amounts under this Note.
Interest on this Note is computed on a 365/360 simple interest basis; that
is, by applying the ratio of the annual interest rate over a year of 360
days, multiplied by the outstanding principal balance, multiplied by the
actual number of days the principal balance is outstanding. Borrower will
pay Lender at Lender's address shown above or at such other place as Lender
may designate in writing. Unless otherwise agreed or required by
applicable law, payments will be applied first to accrued unpaid interest,
then to principal and any remaining amount to any unpaid collection costs
and late charges.
VARIABLE INTEREST RATE. The interest rate on this Note is subject to
change from time to time based on changes in an Index which is the LENDER'S
PRIME RATE (the "Index"). PRIME RATE IS THE LENDER'S BASE LENDING RATE AS
ANNOUNCED BY THE LENDER FROM TIME TO TIME AT ITS SOLE DISCRETION. AT ANY
GIVEN TIME, THE LENDER MAY MAKE LOANS, AT, ABOVE, OR BELOW ITS PRIME RATE.
Lender will tell Borrower the current Index rate upon Borrower's request.
Borrower understands that Lender may make loans based on other rates as
well. The interest rate change will not occur more often than each DAY.
The Index currently is 8.750% per annum. The interest rate or rates to be
applied to the unpaid principal balance of this Note will be the rate or
rates set forth above in the "Payment" section. NOTICE: Under no
circumstances will the interest rate on this Note be more than the maximum
rate allowed by applicable law. Whenever increases occur in the interest
rate, Lender, at its option, may do one or more of the following: (a)
increase Borrower's payments to ensure Borrower's loan will pay off by its
original final maturity date, (b) increase Borrower's payments to cover
accruing interest, (c) increase the number of Borrower's payments, and (d)
continue Borrower's payments at the same amount and increase Borrower's
final payment.
PREPAYMENT; MINIMUM INTEREST CHARGE. Borrower agrees that all loan fees
and other prepaid finance charges are earned fully as of the date of the
loan and will not be subject to refund upon early payment (whether
voluntary or as a result of default), except as otherwise required by law.
In any event, even upon full prepayment of this Note, Borrower understands
that Lender is entitled to a minimum interest charge of $25.00. Other than
Borrower's obligation to pay any minimum interest charge, Borrower may pay
without penalty all or a portion of the amount owed earlier than it is due.
DEFAULT. Borrower will be in default if any of the following happens: (a)
Borrower fails to make any payment when due and fails to cure such default
within three (3) business days after notice from Lender. (b) Borrower
breaks any promise Borrower has made to Lender, or Borrower fails to
comply with or to perform when due any other term, obligation, covenant, or
condition contained in this Note or any agreement related to this Note, or
in any other agreement or loan Borrower has with Lender. (c) Borrower
defaults under any loan, extension of credit, security agreement, purchase
or sales agreement, or any other agreement, in favor of any other creditor
or person that may materially affect any of Borrower's property or
Borrower's ability to repay this note or perform Borrower's obligations
under this Note or any of the Related Documents. (d) Any representation or
statement made or furnished to Lender by Borrower or on Borrower's behalf
is false or misleading in any material respect either now or at the time
made or furnished. (e) Borrower becomes insolvent, a receiver is appointed
for any part of Borrower's property, Borrower makes an assignment for the
benefit of creditors, or any proceeding is commenced either by Borrower or
against Borrower under any bankruptcy or insolvency laws. (f) Any
creditor tries to take any of Borrower's property on or in which Lender has
a lien or security interest. Provided , however, that this event of default
shall not apply if there is a good faith dispute by the Borrower or
Grantor, as the case may be, as to the validity or reasonableness of the
claim which is basis of the creditor proceeding and if Borrower or Grantor
gives Lender written notice of the creditor proceedings and furnishes
reserves for a surety for the creditor proceedings satisfactory to Lender.
This includes a garnishment of any of Borrower's accounts with Lender (g)
Any of the events described in this default section occurs with respect to
any guarantor of this Note. (h) A material adverse change occurs in
Borrower's financial condition, or Lender believes the prospect of payment
or performance of the Indebtedness is impaired.
LENDER'S RIGHTS. Upon default, Lender may declare the entire unpaid
principal balance on this Note and all accrued unpaid interest immediately
due, without notice, and then Borrower will pay that amount. Upon default,
including failure to pay upon final maturity, Lender, at its option, may
also, if permitted under applicable law, do one or both of the following:
(a) increase the variable interest rate on this Note to 25.000% per annum,
and (b) add any unpaid accrued interest to principal and such sum will bear
interest therefrom until paid at the rate provided in this Note (including
any increased rate). The interest rate will not exceed the maximum rate
permitted by applicable law. Lender may hire or pay someone else to help
collect this Note if Borrower does not pay. Borrower also will pay Lender
that amount. This includes subject to any limits under applicable law,
Lenders reasonable attorneys' fees and Lender's legal expenses whether or
not there is a lawsuit, including reasonable attorneys fees and legal
expenses for bankruptcy proceedings (including efforts to modify or vacate
any automatic stay or injunction), appeals, and any anticipated post-
judgment collection services. If not prohibited by applicable law,
Borrower also will pay any court costs, in addition to all other sums
provided by law. This Note has been delivered to Lender and accepted by
Lender in the State of Colorado. If there is a lawsuit, Borrower agrees
upon Lender's request to submit to the jurisdiction of the courts of EL
PASO County, the State of Colorado. Lender and Borrower hereby waive the
right to any jury trial in any action, proceeding, or counterclaim brought
by either Lender or Borrower against the other. This Note shall be
governed by and construed in accordance with the laws of the State of
Colorado.
RIGHT OF SETOFF. Borrower grants to Lender a contractual possessory
security interest in, and hereby assigns, conveys, delivers, pledges, and
transfers to Lender all Borrower's right, title and interest in and to,
Borrower's accounts with Lender (whether checking, savings, or some other
account), including without limitation all accounts held jointly with
someone else and all accounts Borrower may open in the future, excluding
however all IRA, Keogh, and trust accounts. Borrower authorizes Lender, to
the extent permitted by applicable law, to charge or setoff all sums owing
on this Note against any and all such accounts.
GENERAL PROVISIONS. Lender may delay or forgo enforcing any of its rights
or remedies under this Note without losing them. Borrower and any other
person who signs, guarantees or endorses this Note, to the extent allowed
by law, waive presentment, demand for payment, protest and notice of
dishonor. Upon any change in the terms of this Note, and unless otherwise
expressly stated in writing, no party who signs this Note, whether as
maker, guarantor, accommodation maker or endorser, shall be released from
liability. All such parties agree that Lender may renew or extend
(repeatedly and for any length of time) this loan, or release any party or
guarantor or collateral; or impair, fail to realize upon or perfect
Lender's security interest in the collateral; and take any other action
deemed necessary by Lender without the consent of or notice to anyone. All
such parties also agree that Lender may modify this loan without the
consent of or notice to anyone other than the party with whom the
modification is made.
PRIOR TO SIGNING THIS NOTE, BORROWER READ AND UNDERSTOOD ALL THE PROVISIONS
OF THIS NOTE, INCLUDING THE VARIABLE INTEREST RATE PROVISIONS. Borrower
AGREES TO THE TERMS OF THE NOTE AND ACKNOWLEDGES RECEIPT OF A COMPLETED
COPY OF THE NOTE.
BORROWER:
ANALYTICAL SURVEYS INC., A COLORADO CORPORATION<PAGE>
BY:_____________________________BY:_/s/ Sidney V. Corder_____
JOHN A.THORPE, Chairman SIDNEY V.CORDER, President
BY:__/s/ Scott C. Benger________
SCOTT C. BENGER, Vice President
___________________________________________________________________________
Additionally, this Promissory Note includes the following:
Creditor of Forfeiture Proceedings. However, this Event of Default shall
not apply if there is a good faith dispute by Borrower or Grantor, as the
case may be, as to the validity or reasonableness of the claim which is the
basis of the creditor or forfeiture proceeding, and if Borrower or Grantor
gives Lender written notice of the creditor or forfeiture proceeding and
furnishes reserves or a surety bond for the creditor or forfeiture
proceeding satisfactory to Lender.
Right to Cure. If any default, other than a Default on Indebtedness, is
curable and if Borrower or Grantor, as the case may be, has not been given
a notice of a similar default within the preceding twelve (12) months, it
may be cured (and no Event of Default will have occurred) if Borrower or
Grantor, as the case may be, after receiving written notice from Lender
demanding cure of such default: (a) cures the default within thirty (30)
days; or (b) if the cure requires more than thirty (30) days, immediately
initiates steps which Lender deems in Lender's sole discretion to be
sufficient to cure the default and thereafter continues and completes all
reasonable and necessary steps sufficient to produce compliance as soon as
reasonably practical.
Analytical Surveys, Inc., A Colorado Corporation
By:______________________________
John A. Thorpe, Chairman
By:_/s/Sidney V. Corder____________
Sidney V. Corder, President
By:_/s/ Scott C. Benger__________
Scott C. Benger, Vice President
Bank One, Colorado N.A.
By:__/s/ Thomas D. Young__________
Thomas D. Young, Sr. Vice President<PAGE>
PROMISSORY NOTE
Principal Loan Date Maturity Loan No Call
Collateral
$1,850.000.00 12/20/95 02/28/97
Account Officer Initials
176857108 048
Borrower: ANALYTICAL SURVEYS, INC., A COLORADO CORPORATION
1935 JAMBOREE DRIVE
COLORADO SPRINGS, CO 80920
Lender: BANK ONE, COLORADO, N.A.
Colorado Springs Banking Center
2696 South Colorado Blvd.
DENVER , CO 80222
PROMISE TO PAY. ANALYTICAL SURVEYS, INC., A COLORADO CORPORATION
("Borrower") promises to pay to BANK ONE, COLORADO, N.A. ("Lender"), or
order, in lawful money of the United States of America, the principal
amount of One Million Eight Hundred Fifty Thousand & 00/100 Dollars
($1,850,000.00) or so much as may be outstanding, together with interest on
the unpaid outstanding principal balance of each advance. Interest shall
be calculated from the date of each advance until repayment of each
advance.
PAYMENT. Borrower will pay this loan in one payment of all outstanding
principal plus all accrued unpaid interest on February 28, 1997, and all
subsequent interest payment are due on the same day of each month after
that. Interest on this Note is computed on a 365/360 simple interest
basis; that is, by applying the ratio of the annual interest rate over a
year of 360 days, multiplied by the outstanding principal balance,
multiplied by the actual number of days the principal balance is
outstanding. Borrower will pay Lender at Lender's address shown above or
at such other place as Lender may designate in writing. Unless otherwise
agreed or required by applicable law, payments will be applied first to
accrued unpaid interest, then to principal and any remaining amount to any
unpaid collection costs and late charges.
VARIABLE INTEREST RATE. The interest rate on this Note is subject to
change from time to time based on changes in an index which is the LENDER'S
PRIME RATE (the "Index"). PRIME RATE IS THE LENDER'S BASE LENDING RATE AS
ANNOUNCED BY THE LENDER FROM TIME TO TIME AT ITS SOLE DISCRETION. AT ANY
GIVEN TIME, THE LENDER MAY MAKE LOANS, AT, ABOVE, OR BELOW ITS PRIME RATE.
Lender will tell Borrower the current index rate upon Borrower's request.
Borrower understands that Lender may make loans based on other rates as
well. The interest rate change will not occur more often than each DAY.
The Index currently is 8.750% per annum. The Interest rate or rates to be
applied to the unpaid principal balance of this Note will be at a rate of
0.500 percentage points over the Index, resulting in an initial rate of
9.250% per annum. NOTICE: Under no circumstances will the interest rate on
this Note be more than the maximum rate allowed by applicable law.
PREPAYMENT; MINIMUM INTEREST CHARGE. Borrower agrees that all loan fees
and other prepaid finance charges are earned fully as of the date of the
loan and will not be subject to refund upon early payment (whether
voluntary or as a result of default), except as otherwise required by law.
In any event, even upon full prepayment of this Note, Borrower understands
that Lender is entitled to a minimum interest charge of $25.00. Other than
Borrower's obligation to pay any minimum interest charge, Borrower may pay
without penalty all or a portion of the amount owed earlier than it is due.
DEFAULT. Borrower will be in default if any of the following happens: (a)
Borrower fails to make any payment when due. Provided , however, that this
event of default shall not apply if there is a good faith dispute by the
Borrower or Grantor, as the case may be, as to the validity or
reasonableness of the claim which is basis of the creditor proceeding and
if Borrower or Grantor gives Lender written notice of the creditor
proceedings and furnishes reserves for a surety for the creditor
proceedings satisfactory to Lender. (b) Borrower breaks any promise
Borrower has made to Lender, or Borrower fails to comply with or to perform
when due any other term, obligation, covenant, or condition contained in
this Note or any agreement related to this Note, or in any other agreement
or loan Borrower has with Lender. (c) Borrower defaults under any loan,
extension of credit, security agreement, purchase or sales agreement, or
any other agreement, in favor of any other creditor or person that may
materially affect any of Borrower's property or Borrower's ability to repay
this Note or perform Borrower's obligations under this Note or any of the
Related Documents. (d) Any representation or statement made or furnished to
Lender by Borrower or on Borrower's behalf is false or misleading in any
material respect either now or at the time made or furnished. (e) Borrower
becomes insolvent, a receiver is appointed for any part of Borrower's
property, Borrower makes an assignment for the benefit of creditors, or any
proceeding is commenced either by Borrower or against Borrower under any
bankruptcy or insolvency laws. (f) Any creditor tries to take any of
Borrower's property on or in which Lender has a lien or security interest
and fails to cure such default within three (3) business days after notice
from Lender. This includes a garnishment of any of Borrower's accounts with
Lender. (g) Any of the events described in this default section occurs with
respect to any guarantor of this Note. (h) A material adverse change occurs
in Borrower's financial condition, or Lender believes the prospect of
payment or performance of the Indebtedness is impaired and fails to cure
such default within three (3) business days after notice from Lender.
LENDER'S RIGHTS. Upon default, Lender may declare the entire unpaid
principal balance on this Note and all accrued unpaid interest immediately
due, without notice, and then Borrower will pay that amount. Upon default,
including failure to pay upon final maturity, Lender, at its option, may
also, if permitted under applicable law, do one or both of the following:
(a) increase the variable interest rate on this Note to 25.000% per annum,
and (b) add any unpaid accrued interest to principal and such sum will bear
interest therefrom until paid at the rate provided in this Note (including
any increased rate). The interest rate will not exceed the maximum rate
permitted by applicable law. Lender may hire or pay someone else to help
collect this Note if Borrower does not pay. Borrower also will pay Lender
that amount. This includes subject to any limits under applicable law,
Lenders reasonable attorneys' fees and Lender's legal expenses whether or
not there is a lawsuit, including reasonable attorneys fees and legal
expenses for bankruptcy proceedings (including efforts to modify or vacate
any automatic stay or injunction), appeals, and any anticipated post-
judgment collection services. If not prohibited by applicable law,
Borrower also will pay any court costs, in addition to all other sums
provided by law. This Note has been delivered to Lender and accepted by
Lender in the State of Colorado. If there is a lawsuit, Borrower agrees
upon Lender's request to submit to the jurisdiction of the courts of EL
PASO County, the State of Colorado. Lender and Borrower hereby waive the
right to any jury trial in any action, proceeding, or counterclaim brought
by either Lender or Borrower against the other. This Note shall be
governed by the construed in accordance with the laws of the State of
Colorado
RIGHT OF SETOFF. Borrower grants to Lender a contractual possessory
security interest in, and hereby assigns, conveys, delivers, pledges, and
transfers to Lender all Borrower's right, title and interest in and to,
Borrower's accounts with Lender (whether checking, savings, or some other
account), including without limitation all accounts held jointly with
someone else and all accounts Borrower may open in the future, excluding
however all IRA, Keogh, and trust accounts. Borrower authorizes Lender, to
the extent permitted by applicable law, to charge or setoff all sums owing
on this Note against any and all such accounts.
LINE OF CREDIT. This Note evidences a revolving line of credit. Advances
under this Note, as well as directions for payment from Borrower's
accounts, may be requested orally or in writing by Borrower or by an
authorized person. Lender may, but need not, require that all oral
requests be confirmed in writing. Borrower agrees to be liable for all
sums either: (a) advanced in accordance with the instructions of an
authorized person or (b) credited to any of Borrower's accounts with
Lender. The unpaid principal balance owing on this Note at any time may be
evidenced by endorsements on this Note or by Lender's internal records,
including daily computer print-outs. Lender will have no obligation to
advance funds under this Note if: (a) Borrower or any guarantor is in
default under the terms of this Note or any agreement that Borrower or any
guarantor has with Lender, including any agreement made in connection with
the signing of this Note; (b) Borrower or any guarantor ceases doing
business or is insolvent; (c) any guarantor seeks, claims or otherwise
attempts to limit, modify or revoke such guarantor's guarantee of this Note
or any other loan with Lender; or (d) Borrower has applied funds provided
pursuant to this Note for purposes other than those authorized by Lender.
GENERAL PROVISIONS. Lender may delay or forgo enforcing any of its rights
or remedies under this Note without losing them. Borrower and any other
person who signs, guarantees or endorses this Note, to the extent allowed
by law, waive presentment, demand for payment, protest and notice of
dishonor. Upon any change in the terms of this Note, and unless otherwise
expressly stated in writing, no party who signs this Note, whether as
maker, guarantor, accommodation maker or endorser, shall be released from
liability. All such parties agree that Lender may renew or extend
(repeatedly and for any length of time) this loan, or release any party or
guarantor or collateral; or impair, fail to realize upon or perfect
Lender's security interest in the collateral; and take any other action
deemed necessary by Lender without the consent of or notice to anyone. All
such parties also agree that Lender may modify this loan without the
consent of or notice to anyone other than the party with whom the
modification is made.
PRIOR TO SIGNING THIS NOTE, BORROWER READ AND UNDERSTOOD ALL THE PROVISIONS
OF THIS NOTE, INCLUDING THE VARIABLE INTEREST RATE PROVISIONS. BORROWER
AGREES TO THE TERMS OF THE NOTE AND ACKNOWLEDGES RECEIPT OF A COMPLETED
COPY OF THE NOTE.
BORROWER:
ANALYTICAL SURVEYS INC., A COLORADO CORPORATION
BY:_____________________________ BY:__/s/ Sidney V. Corder_____
JOHN A.THORPE, Chairman SIDNEY V.CORDER, President<PAGE>
BY:_/s/ Scott C. Benger_________
SCOTT C. BENGER, Vice President
___________________________________________________________________________
Additionally, this Promissory Note includes the following:
Creditor or Forfeiture Proceedings. However, this Event of Default shall
not apply if there is a good faith dispute by Borrower or Grantor, as the
case may be, as to the validity or reasonableness of the claim which is the
basis of the creditor or forfeiture proceeding, and if Borrower or Grantor
gives Lender written notice of the creditor or forfeiture proceeding and
furnished reserves or a surety bond for the creditor or forfeiture
proceeding satisfactory to Lender.
Right to Cure. If any default, other than a Default on Indebtedness, is
curable and if Borrower or Grantor, as the case may be, has not been given
a notice of a similar default within the preceding twelve (12) months, it
may be cured (and no Event of Default will have occurred) if Borrower or
Grantor, as the case may be, after receiving written notice from Lender
demanding cure of such default: (a) cures the default within thirty (30)
days; or (b) if the cure requires more than thirty (30) days, immediately
initiates steps which Lender deems in Lender's sole discretion to be
sufficient to cure the default and thereafter continues and completes all
reasonable and necessary steps sufficient to produce compliance as soon as
reasonably practical.
Analytical Surveys, Inc., A Colorado Corporation
By:______________________________
John A. Thorpe, Chairman
By:_/s/ Sidney V. Corder_________
Sidney V. Corder, President
By:_/s/ Scott C. Benger__________
Scott C. Benger, Vice President
Bank One, Colorado N.A.
By:_/s/ Thomas D. Young_____
Thomas D. Young, Sr. Vice President<PAGE>
LEASE
THIS LEASE is made as of this third day of December,
1993, by and between CENTER CITY PLAZA, a Wisconsin partnership,
hereinafter referred to as "Landlord", and INTELLIGRAPHICS, INC.,
a Wisconsin corporation, hereinafter referred to as "Tenant".
I. DEMISE OF LEASED PREMISES
In consideration of the rents hereinafter reserved and
of the covenants and agreements hereinafter contained, Landlord
does hereby demise and lease unto Tenant, and Tenant does hereby
hire and take from Landlord, all those premises (the "Leased
Premises") with the improvements and appurtenances now or
hereafter located therein, in a building commonly designated as
741 N. Grand Avenue, situated in the City of Waukesha, Waukesha
County, Wisconsin and outlined in red on the plan attached hereto
as Exhibit A. This Lease for the Leased Premises is subject to
municipal and zoning ordinances regulating and restricting the
use of the Leased Premises and construction of any improvements
thereon and recorded covenants, easements and restrictions
affecting the Leased Premises.
II. TERM OF LEASE
1. The term of this Lease shall be for a period of
five (5) years, commencing on the date (the "Commencement Date")
that Landlord substantially completes construction of the Project
(as defined in Article IV below) and ending at 11:59 p.m. of the
last day of the fifth (5th) Lease Year (as hereinafter defined),
unless sooner terminated in accordance with this Lease or
extended pursuant to Paragraph 2 below. Landlord shall use all
reasonable efforts to ensure that the Project is completed on or
before April 1, 1994. If Landlord's work on account of
construction of the Project is not completed on or before June
30, 1994, for any reason whatsoever, then Tenant may, at Tenant's
sole option, terminate and cancel this Lease by written notice to
Landlord within thirty (30) days thereafter, in which event
neither party shall have any further rights or obligations under
this Lease. As used herein, "Lease Year" shall mean a period of
twelve (12) full and consecutive calendar months. The initial
Lease Year shall begin on the Commencement Date and end on the
last day of the month preceding the first anniversary of the
Commencement Date; provided, however, if the Commencement Date
does not occur on the first day of a calendar month, then the
initial Lease Year shall begin on the Commencement Date and end
on the last day of the month which contains the first anniversary
thereof. Each succeeding Lease Year shall begin upon the
termination of the preceding Lease Year. The parties shall, at
the request of either, execute and deliver an instrument
confirming the Commencement Date and expiration date when
determined.
2. Tenant shall have the option to extend the term
of this Lease for two (2) additional and consecutive five (5)
year periods, the first option commencing upon the expiration of
the initial term, and the second option commencing on the
expiration of the first option. The first option shall be
exercised only by Tenant giving Landlord written notice thereof
which is received by Landlord not less than twelve (12) months
prior to the expiration of the initial term of this Lease, and
the second option shall be exercised only by Tenant giving
Landlord written notice thereof which is received by Landlord not
less than twelve (12) months prior to the expiration of the first
option; provided, however, Tenant shall be entitled to exercise
the options granted herein and the term of this Lease shall, in
fact, be extended only if this Lease is in full force and effect
and Tenant is not in default of any material term of this Lease
beyond any applicable cure period at the times set forth herein
for the exercise of the option and the commencement of the
extension period. Time shall be of the essence with respect to
Tenant's notice(s) as aforesaid. Tenant's failure to exercise
the first option granted herein in accordance with this Paragraph
shall extinguish the second option. In the event that the term
of this Lease is, in fact, extended pursuant to the foregoing,
then any such extension shall be upon all of the same terms and
provisions contained in this Lease including the adjustment in
the fixed annual rent as set forth in Article III, Paragraph 1
below.
III. RENTAL
1. Commencing on the Commencement Date and
continuing until the end of the first Lease Year, Tenant shall
pay to Landlord a fixed annual rent of $81,439.25 per year,
payable on or before the first day of each month during such
period in equal monthly installments of $6,779.10 each. If the
Commencement Date shall not be on the first day of a month, then
the rent payable for the first partial month shall be prorated on
a daily basis. On the first day of the second Lease Year and on
the first day of each Lease Year thereafter, the fixed rent
payable by Tenant to Landlord as aforesaid shall be adjusted to
an amount equal to the fixed rent payable immediately prior to
the adjustment date in question, increased by seventy-five
percent (75%) of the percentage increase, if any, in the Cost of
Living Index (as hereinafter defined) for the month last
published immediately preceding the date for which the comparison
is being made over the Cost of Living Index published for the
identical month in the preceding year. The fixed annual rent as
adjusted pursuant to the foregoing shall be payable in advance in
equal monthly installments on or before the first day of each
calendar month. "Cost of Living Index" as used herein shall mean
the index presently known as "Consumer Price Index, U.S. Average,
All Items, All Urban Consumers (1982-84=100)" published by the
Bureau of Labor Statistics, United States Department of Labor.
If the computation and publication of the Cost of Living Index is
transferred to another governmental bureau, such bureau's
publication shall be substituted for the presently published
index. If the Cost of Living Index is substantially revised, or
its method of calculation is substantially altered, adjustments
shall be made to such new index by Landlord as may be necessary
to make it comparable to the original index used; provided,
however, that the addition or elimination of particular items or
commodities included in the Cost of Living Index shall not be
deemed a "substantial" revision or a "substantial" alteration of
its method of calculation. In the event the Bureau of Labor
Statistics or other governmental bureau to whom the publication
of the Cost of Living Index is transferred publishes such
adjustment, then such adjustment as published shall be
controlling upon the parties. In the event the Cost of Living
Index is discontinued, Landlord and Tenant shall accept
comparable statistics on the purchasing power of the consumer
dollar as published at the time of such discontinuation by a
responsible financial periodical of recognized authority to be
then chosen by the parties.
2. The rent and all other sums payable by Tenant
hereunder shall be paid to Landlord, without notice, at the
address as hereinafter designated for notices to Landlord or at
such other place as Landlord may from time to time designate. It
is intended hereby that all rent payable under the terms of this
Lease shall be an absolute net return to Landlord for the Lease
term free from any expense, charge, offset, abatement, or
deduction whatsoever except as expressly set forth herein.
IV. CONSTRUCTION OF LEASED PREMISES
1. Landlord shall, at its expense, improve the
Leased Premises by constructing therein an office building (the
"Project") in accordance with the plans and specifications
identified and described on Exhibit B attached hereto (the "Plans
and Specifications"). It is expressly understood and agreed that
notwithstanding Tenant's approval of the Plans and
Specifications, Tenant shall have no liability whatsoever for any
defects, errors or omissions in the documentation furnished by it
to Landlord or as a result of its approval of the Plans and
Specifications prepared by Landlord's architect.
2. Promptly after execution of this Lease, Landlord
shall make application for all required permits from the
appropriate governmental authorities having jurisdiction over the
Leased Premises for the construction of the Project and
thereafter Landlord shall diligently pursue the same and use its
good faith efforts to secure such permits. After Landlord has
obtained necessary permits, Landlord shall promptly commence and
shall diligently proceed with the construction of the Project in
order to complete the same at the earliest possible date
consistent with sound construction practices. No changes shall
be made to the Plans and Specifications or the construction work
to be performed by Landlord without the written approval of
Landlord and Tenant, which approval shall specify without
limitation any additional cost and the effect of such change on
the completion date. Tenant shall advise Landlord in writing of
the name of its designated representative for the purpose of
granting such approvals as are necessary, and Tenant shall have
the right to change such representative from time to time upon
written notice to Landlord.
3. Landlord's work on account of construction of
the Project shall be done in a good and workmanlike manner in
compliance with the Plans and Specifications and all building
codes and regulations. Landlord shall keep Tenant informed on a
regular basis (but no less often than monthly) as to the progress
of construction and Tenant shall at all times have access to the
work and the Plans and Specifications to inspect and review the
same, provided that any inspection or entry by Tenant shall not
unreasonably interfere with or unduly delay Landlord's
construction work, and Tenant waives all claims against Landlord
for personal injury or property damage, and indemnifies and holds
Landlord harmless from all claims, liabilities, damages and
expenses (including reasonable attorneys' fees), resulting from
any such inspection or entry except to the extent due to the
negligence or willful misconduct of Landlord, its agents,
employees or contractors. Landlord covenants that upon
completion of such construction work, the Leased Premises shall
be in compliance with all laws, codes and ordinances. Within
thirty (30) days following delivery of possession of the Leased
Premises to Tenant, Tenant may inspect the same and generate a
punch list of those portions of the work which, in Tenant's
reasonable estimation, are incomplete or not substantially in
conformance with the Plans and Specifications, and Landlord shall
complete or remedy the same within a reasonable time following
the receipt of such list. Further, Landlord shall promptly
correct, repair and/or replace any defective workmanship and/or
material in the Project of which Tenant notifies Landlord within
one (1) year after possession of the Leased Premises is delivered
to Tenant, and Landlord shall correct, repair and/or replace any
latent defects in the Project. Landlord agrees that any
guarantees or warranties received by Landlord from the general
contractor and any subcontractor, supplier or materialmen with
respect to the construction of the Project shall be assigned to
Tenant, and Landlord shall, upon demand from the Tenant, join
with Tenant in enforcing the same.
4. Landlord shall give Tenant written notice upon
completion of construction of the Project accompanied by (i) a
certificate from Landlord's architect certifying that the Leased
Premises have been completed in accordance with the Plans and
Specifications and (ii) an occupancy permit for occupancy of the
Leased Premises. Landlord agrees that during the course of
constructing the Project on the Leased Premises, Tenant may enter
the same for the purpose of installing its fixtures and equipment
to whatever extent it may be practical so to do without
interfering with the completion of the Project and without being
guilty of or liable for trespass, rent, use or occupancy.
V. USE OF LEASED PREMISES
1. The Leased Premises shall be used for offices
and other uses ancillary thereto or for any other lawful purpose.
2. The use of the Leased Premises shall be in full
compliance with, and Tenant shall, at its own cost and expense,
promptly observe and comply with, all present and future laws,
ordinances, rules, regulations and requirements of all public
authorities having jurisdiction over the Leased Premises relating
to or affecting the Leased Premises or its use, and Tenant shall,
at its own cost and expense, make all additions, alterations or
changes to the Leased Premises as may be required by any
governmental authority. Notwithstanding the foregoing, Tenant
shall have the right to contest by appropriate legal proceedings
diligently conducted in good faith, in the name of Tenant, or
Landlord (if legally required), or both (if legally required),
without cost or expense to Landlord, the validity or application
of any such law, ordinance, rule, regulation or requirement and
if compliance therewith may legally be delayed pending the
prosecution of any such proceeding, Tenant may delay such
compliance therewith until the final determination of such
proceeding provided that Tenant shall have furnished Landlord
with a bond of a surety company reasonably satisfactory to
Landlord or other security adequate in the reasonable opinion of
Landlord to assure compliance will occur if Tenant's contest is
unsuccessful. Landlord agrees to execute and deliver any
appropriate papers or other instruments which may be necessary or
proper to permit Tenant so to contest the validity or application
of any such law, ordinance, rule, regulation or requirement and
to fully cooperate with Tenant in such contest.
3. In the event any Hazardous Material (as
hereinafter defined) is brought into or onto the Leased Premises
by anyone other than Landlord, its agents or employees, Tenant
shall handle any such material in compliance with all applicable
federal, state and/or local regulations. For purposes of this
Section, "Hazardous Material" means and includes any hazardous,
toxic or dangerous waste, substance or material defined as such
in (or for purposes of) the Comprehensive Environmental Response,
Compensation, and Liability Act, any so-called "Superfund" or
"Superlien" law, or any federal, state or local statute, law,
ordinance, code, rule, regulation, order or decree regulating,
relating to or imposing liability or standards of conduct
concerning, any hazardous, toxic or dangerous waste, substance or
material, as now or at any time hereafter in effect. Tenant
agrees to indemnify and hold Landlord harmless from any
liability, claim, damage or expense (including reasonable
attorneys' fees) which Landlord may suffer or incur as a result
of the presence or introduction of any Hazardous Material onto
the Premises unless introduced by Landlord, its agents or
employees. Landlord agrees to indemnify and hold Tenant harmless
from any liability, claim, damage or expense (including
reasonable attorneys' fees) which Tenant may suffer or incur as a
result of Landlord's introduction of any Hazardous Material onto
the Leased Premises. The foregoing covenants and
indemnifications shall survive the expiration of the term of this
Lease.
VI. MAINTENANCE AND REPAIRS
Except for repairs and replacements which are the
obligation of Landlord under Article IV, Paragraph 3 and under
Article VII, Paragraph 3, Tenant shall, at all times during the
term of this Lease, and at its own cost and expense, make all
necessary repairs and replacements to keep and maintain the
Leased Premises in good and sanitary order, condition and repair,
ordinary wear and tear excepted, and Tenant shall use all
reasonable precaution to prevent waste, damage or injury thereto.
Tenant shall not defer any repairs or replacements to the Leased
Premises which are Tenant's obligation hereunder in anticipation
of the expiration of the Lease term. Tenant's obligations under
this paragraph shall survive the expiration or earlier
termination of this Lease. In any event, Landlord shall not be
required to make any replacement to the Leased Premises during
the term hereof or any extension, except as provided in Article
IV, Paragraph 3 and Article VII, Paragraph 3, of this Lease.
VII. UTILITIES AND SERVICES
1. Landlord shall be responsible for and shall pay
when due all charges for non-hazardous trash removal, elevator
services, gas, water and sanitary sewer used or consumed in the
Leased Premises. In no event shall Landlord be liable for an
interruption or failure in the supply of any utility to the
Leased Premises.
2. Tenant shall be responsible for and shall pay
when due all charges for electric power (including that used for
air conditioning), telephone service, and janitorial services
provided in the Leased Premises.
3. Landlord shall be responsible for and shall pay
when due all charges for maintenance of equipment for heating,
air conditioning and ventilation systems; charges for snow
plowing, grounds maintenance, and cleaning and maintenance of
common areas.
VIII. ALTERATIONS
1. Tenant shall not make any alterations, additions
or improvements to the Leased Premises without procuring
Landlord's prior written consent and delivering to Landlord the
Plans and Specifications therefor. Notwithstanding the
foregoing, Landlord's consent shall not be required for minor
alterations or for alterations which do not affect the exterior
appearance or structural integrity of the Leased Premises. Any
alterations, additions and improvements installed or placed upon
the Leased Premises by Tenant must be made in a good and
workmanlike manner in accordance with the laws, ordinances and
codes relating thereto. Any such alterations, additions and
improvements may be removed by Tenant at any time provided Tenant
repairs any damage to the Leased Premises resulting from such
removal.
2. Tenant shall not suffer or permit any liens
under any construction lien law or similar law to be filed or
recorded against the Leased Premises or against the interest of
either Landlord or Tenant therein. If any such lien at any time
be filed or recorded, Tenant shall promptly obtain the release of
record of such lien or bond over such lien as required by
statute, at Tenant's own cost and expense, if Tenant disputes the
validity of such lien.
IX. SIGNS
Tenant shall have the right to erect, maintain and
replace such signs at the entrance to the Leased Premises as
Tenant may desire, provided that Tenant submits plans for
architectural approval by the Landlord and that such signs shall
comply with all applicable ordinances and requirements of
governmental authorities having jurisdiction. As used in this
Article, the word "sign" shall be construed to include any
placard, light or other advertising symbol or object,
irrespective of whether the same is temporary or permanent. At
the expiration or earlier termination of this Lease, Tenant
shall, at its own expense, remove all signs installed by Tenant
on the Leased Premises and repair any damage to the Leased
Premises resulting from such removal.
X. PARKING
1. Tenant shall have the right to designate and use
at the Tenant's discretion six (6) parking stalls adjacent to the
pedestrian bridge entrance to the Municipal Parking Ramp.
2. Landlord shall purchase from the City of
Waukesha at Landlord's expense and deliver to Tenant six (6)
monthly parking permits for the Municipal Parking Ramp. Landlord
shall pay the fee for these parking permits for the entire term
of this Lease.
3. Landlord shall make available to Tenant up to
thirty (30) additional monthly parking permits for the Municipal
Parking Ramp. These permits shall be for undesignated stalls in
the ramp and shall be at Tenant's expense. The costs will be the
same as the monthly parking permit fee charged to the general
public as established by the City of Waukesha from time to time.
In no case shall the fee exceed $12.00 per month for the year of
1994.
XI. INSURANCE
1. Tenant shall, during the entire term of this
Lease, keep in full force and effect a policy of commercial
general liability insurance with respect to the Leased Premises
and including contractual liability for the indemnification
obligations of Tenant contained in this Lease in an amount of not
less than $2,000,000.00 combined single limit. The insurance
policy shall name Tenant, Landlord and Landlord's mortgagee, if
any, as insured as their interests appear. Such insurance shall
contain a clause that the insurer will not cancel or change the
insurance without first giving Landlord thirty (30) days prior
written notice. Such insurance may be furnished by Tenant under
any blanket policy carried by it or under a separate policy
therefor. The insurance shall be written by insurance companies
licensed to do business in Wisconsin and reasonably acceptable to
Landlord and a copy of the paid-up policy evidencing such
insurance or a certificate of insurance certifying to the
issuance of such policy shall be delivered to Landlord prior to
commencement of the term of this Lease, and such delivery shall
also be made upon renewal of such policy not less than thirty
(30) days prior to the expiration of such coverage.
2. Tenant shall, at its own cost, during the Lease
term carry insurance against fire, vandalism, malicious mischief
and such other perils as are from time to time included in a
standard extended coverage endorsement insuring any betterments
and improvements made by Tenant to the Leased Premises and all
trade fixtures, furnishings, equipment and all other items of
personal property located at the Leased Premises.
3. Landlord shall not be responsible or liable to
Tenant for any loss or damage to any property, fixtures, or other
improvements on the Leased Premises from any cause whatsoever
including but not limited to the negligent acts or omissions of
Landlord. Landlord shall not be responsible or liable to Tenant
for any personal injury to Tenant or its agents, employees,
contractors, guests, invitees, licensees or customers within or
about the Leased Premises from any cause whatsoever except to the
extent the same results from the negligence or intentional
misconduct of Landlord, its agents or employees.
4. Landlord and Tenant hereby expressly waive any
right of recovery each party may have against the other for a
loss to the Leased Premises or its contents, to the extent of
insurance proceeds actually collected, due to fire or any peril
included in the coverage of any applicable insurance policy
required to be carried hereunder, however caused, including such
losses as may be due to the negligence of Landlord or Tenant or
their respective agents or employees. All policies of insurance
required to be carried hereunder shall contain a provision that
they are not invalidated by the foregoing waiver, but such
waivers shall cease to be effective if the existence thereof
precludes either party from obtaining any such policy.
XII. DESTRUCTION OF IMPROVEMENTS
1. In the event the Leased Premises are damaged or
destroyed in whole or in part by fire or any other cause
whatsoever during the term of this Lease, Landlord shall promptly
repair and restore the Leased Premises which Landlord furnished
upon the commencement of the Lease term to substantially the same
condition that existed just prior to its damage or destruction,
unless this Lease is terminated as hereinafter provided, and the
fixed rent shall be abated in proportion to the portion of the
Leased Premises which is untenantable until the Leased Premises
are repaired by Landlord. The work of rebuilding or repair shall
be initiated by Landlord with all reasonable dispatch, diligently
proceeded with to completion, and Tenant shall repair or replace
its trade fixtures, furnishings and equipment to return them to
substantially the same condition that existed prior to their
damage or destruction. In no event shall Landlord be required to
repair or replace the betterments and improvements installed in
the Leased Premises by Tenant or the trade fixtures, furnishings,
equipment and other personal property located at the Leased
Premises.
2. Notwithstanding anything to the contrary
contained in this Article, in the event that the rebuilding,
restoring or repair of the Leased Premises to tenantable
condition would require more than one hundred eighty (180) days
to complete after commence-ment of the work (subject to extension
for delays caused by acts of God, strikes, lockouts, shortages of
materials and/or workmen or other causes beyond the reasonable
control of Landlord) or in the event that the damage or
destruction to the Leased Premises occurs during the last two
years of the Lease term and would require more than ninety (90)
days to complete after commencement of the work, then either
party may terminate and cancel this Lease by giving written
notice to the other within sixty (60) days after the occur-rence
of such damage or destruction. In the event of any such
termination, all proceeds of insurance maintained by Tenant pur-
suant to Article XI, Paragraph 2 shall be the property of Tenant.
XIII. EMINENT DOMAIN
1. If the entire Leased Premises is taken by any
public authority under power of condemnation or sold to any
public authority in lieu of condemnation, then this Lease shall
terminate as of the date possession is taken by the acquiring
authority and rent shall be apportioned as of that date. If (i)
a portion of the Leased Premises is taken or sold and said taking
or sale results in making the Leased Premises unsuitable for the
use contemplated herein, then Tenant, at its option, may
terminate and cancel this Lease as of the date of taking by
giving Landlord written notice of termination within sixty (60)
days after the date of taking, and the rent shall be apportioned
as of said date. In the event this Lease is not terminated upon
a partial taking of the Leased Premises, Landlord shall, to the
extent possible, promptly commence and pursue diligently until
completion the restoration of the remaining portion of the Leased
Premises which Landlord furnished upon the commencement of the
Lease term to the condition the same were in immediately prior to
such taking and this Lease shall continue in full force and
effect. Landlord shall use such portion of Landlord's proceeds
by reason of such taking necessary to repair and restore the
Leased Premises as herein provided, but in no event shall
Landlord be obligated to expend for such repairs an amount in
excess of the condemnation proceeds available to Landlord for
such rebuilding. During the period in which Landlord is
repairing and restoring the Leased Premises pursuant to this
Paragraph, the rental payable by Tenant shall be apportioned and
prorated in order to abate in proportion to the area of the
Leased Premises which is untenantable.
2. All damages awarded for a total or partial
taking of the Leased Premises shall belong to and be the sole
property of Landlord, and Tenant shall have no claim for loss of
its leasehold estate or the value of the unexpired term hereof;
provided, however, Tenant shall be entitled to pursue any
separate claim or claims as Tenant may have for relocation
expenses, business interruption and other items which are not
included in the award payable to Landlord.
3. In the event that this Lease does not terminate
after any part of the Leased Premises is taken or condemned,
there shall be a reduction in basic rent equal to the percentage
of the square footage area of the Leased Premises which is taken
or condemned.
4. Notwithstanding anything to the contrary
contained herein, if a portion of the Leased Premises is taken or
condemned and this Lease continues in full force and effect, then
the fixed annual rent payable hereunder shall be reduced by a pro
rata reduction based on the reduction in the area of the Leased
Premises which is tenantable.
XIV. ASSIGNMENT AND SUBLETTING
Tenant may assign this Lease or any estate or interest
therein or sublease the Leased Premises or any part thereof and
permit the use and occupancy of the Leased Premises or any part
thereof by any subsidiary or related corporation provided,
however, (i) Tenant shall not be released from any of its
obligations under this Lease upon the occurrence of any of the
foregoing events, (ii) in the event of an assignment, the
assignee shall assume the obligations of Tenant under this Lease
from and after the date of assignment, (iii) Tenant shall give
Landlord prior written notice of the proposed transaction and
Landlord shall be furnished with a copy of any such assignment or
sublease agreement, (iv) any such sublease shall be expressly
subject and subordinate to this Lease, and (v) at the time of the
proposed assignment or sublease Tenant shall not be in default of
the payment of rent due hereunder beyond any cure period.
XV. NOTICES
All notices and demands by either party to the other
shall be given in writing and sent by United States certified
mail, postage prepaid, and addressed:
To Landlord: Center City Plaza
c/o Berg Management Company
235 W. Broadway, Suite 10
Waukesha, WI 53186
To Tenant: Intelligraphics, Inc.
741 N. Grand Avenue
Waukesha, WI 53186
Either party may, upon prior written notice to the
other, specify a different address for the giving of notice.
XVI. ACCESS
Landlord or Landlord's agent shall have the right to
enter the Leased Premises after reasonable notice to Tenant
during normal business hours (except in the event of an emergency
in which event no prior notice is required) for the purpose of
inspecting the same or making repairs which are the obligation of
Landlord hereunder, provided, however, Landlord shall use all
reasonable efforts to avoid interference with the conduct of
Tenant's activities thereon.
XVII. DEFAULTS
1. If (a) Tenant shall fail to pay the rental or
other charges due hereunder within five (5) days after receipt of
written notice thereof by Tenant (provided, however, in the event
that Landlord gives Tenant one such notice within any twelve (12)
month period, Landlord shall not be required to give such notice
thereafter during such twelve month period), or (b) Tenant shall
fail to perform any of the other terms, conditions or covenants
of this Lease to be performed or observed by Tenant for more than
thirty (30) days after receipt by Tenant of written notice from
Landlord specifying in detail the nature of such failure (or such
other reasonable times as necessary if such default is a default
which is susceptible of cure but cannot be cured within thirty
(30) days and Tenant, upon receipt of such notice, promptly and
diligently attempts to effect such cure), (c) Tenant shall be
adjudged bankrupt or insolvent or shall make an assignment for
the benefit of creditors, or (d) a receiver or trustee of
Tenant's property shall be appointed and such receiver or
trustee, as the case may be, shall not be discharged within sixty
(60) days after such appointment, then in any such case, Landlord
may, at its option, upon written notice to Tenant, recover
possession of and re-enter the Leased Premises without accepting
a surrender of the Leased Premises or affecting Tenant's
liability for past rent and other charges due or future rent and
other charges to accrue hereunder. As an alternative, at the
election of Landlord, Landlord shall have the right, upon written
notice to Tenant, to declare this Lease terminated and canceled
and to accept surrender of the Leased Premises (without the need
for any affirmative act or acquiescence by Tenant) without any
further rights or obligations on the part of Landlord or Tenant
(other than Tenant's obligation for rent and other charges due
and owing through the date of termination and the performance of
all of the terms and provisions of this Lease due and owing or
accrued through the date of termination), so that Landlord may
relet the Leased Premises without any right on the part of Tenant
to any credit or payment resulting from any reletting of the
Leased Premises. In the event of any such default, Landlord
shall be entitled to recover from Tenant all other damages
sustained by Landlord on account of the breach of this Lease,
including, but not limited to, the costs incurred by Landlord in
re-entering and recovering possession of the Leased Premises and
the cost of repairs, alterations and brokerage fees connected
with the reletting of the Leased Premises. The provisions herein
shall be in addition and without prejudice to any other rights or
remedies as are available at law or otherwise. Notwithstanding
anything to the contrary contained herein, Landlord shall use
reasonable efforts to mitigate the damages which might arise as a
result of a default by Tenant; and in the event Landlord relets
the Leased Premises, the amount received therefrom prior to
termination of this Lease shall be credited to Tenant after
deducting therefrom Landlord's reasonable expenses.
2. The rights and remedies of Landlord or Tenant
under this Lease shall be cumulative and the exercise of any of
them shall not be exclusive of any other right or remedy provided
by this Lease or allowed by law, and the waiver by Landlord or
Tenant of any breach of any covenant of this Lease shall be
limited to the particular instance and shall not operate or be
deemed to waive any future breach of the same or any other
covenant on the same or any other occasion.
3. No extension of time, forbearance, neglect or
waiver on the part of Landlord or Tenant, as the case may be,
with respect to any one or more of the covenants, terms or
conditions of this Lease, shall be construed as a waiver of any
of the other covenants, terms or conditions of this Lease, or as
an estoppel against Landlord or Tenant, as the case may be.
4. Landlord shall have the right at any time, after
ten (10) days notice to Tenant (or without notice in case of
emergency or in case any fine, penalty, interest or cost may
otherwise be imposed or incurred), to make any payment or perform
any act required of Tenant under any provision of this Lease, and
in exercising such right, to incur necessary and incidental costs
and expenses, including reasonable attorney's fees. Nothing
herein shall imply any obligation on the part of Landlord to make
any payment or perform any act required of Tenant, and the
exercise of the right to so do shall not constitute a release of
any obligation or a waiver of any default. All payments made and
all costs and expenses incurred in connection with any exercise
of such right shall be reimbursed to Landlord by Tenant within
fifteen (15) days after receipt of Landlord's bill therefor. In
the event of nonpayment thereof, Landlord shall have the rights
and remedies it would have hereunder or by law in the case of
nonpayment of rent.
5. In the event of any action or proceeding brought
by either party against the other under this Lease, the
prevailing party shall be entitled to recover all costs and
expenses including reasonable attorney's fees.
6. Should Landlord default in the performance of
the covenants required to be performed by Landlord under this
Lease, Tenant may serve upon Landlord a notice specifying the
default and requiring performance by Landlord within a period of
time set forth in such notice, which shall not be less than
thirty (30) days after receipt of said written notice; provided,
however, Tenant shall have the right (but not the obligation) to
remedy such default without notice in the event of emergency. In
the event of such default by Landlord after notice shall have
been given as aforesaid which is not cured by Landlord within
such thirty (30) day period, then Tenant, in addition to any
other right or remedy Tenant may have at law or equity, shall
have the right (but not the obligation) to cure Landlord's
default and Landlord, within fifteen (15) days after receipt of
Tenant's bill therefor, shall reimburse Tenant the reasonable
costs incurred by Tenant in curing Landlord's default as
aforesaid. However, if any default shall occur which cannot,
with due diligence, be cured within a period of thirty (30) days
from and after the giving of notice as aforesaid, then Landlord
shall be deemed to be complying with such notice if Landlord
promptly commences to take reasonable steps to cure such default
during such time period and proceeds diligently thereafter to in
fact cure such default.
7. Tenant acknowledges that late payment of rent
(fixed rental or additional rental) could result in Landlord's
mortgagee imposing a late charge on Landlord, and, accordingly,
Tenant agrees that, if rent (fixed rental or additional rental)
due hereunder is not paid by the fifth (5th) day after it is due
(or within five (5) days after receipt of written notice of
default if such late payment is the first such late payment
within the past twelve (12) months), then Tenant shall pay upon
demand, as additional rent, a late charge equal to the late
charge, if any, imposed upon Landlord by Landlord's mortgagee.
The foregoing provision for payment of a late charge shall not be
construed to extend the date for payment of any sums required to
be paid by Tenant hereunder or to relieve Tenant of its
obligation to pay all such sums at the time or times herein
stipulated, and neither the demand for, nor collection by,
Landlord of such late charge shall be construed as a cure for
Tenant's default in the payment of rent.
XVIII. SURRENDER
On the last day of the term of the lease or on the
sooner termination thereof, Tenant shall peaceably and quietly
surrender the Leased Premises in good order, condition and
repair, reasonable wear and tear and damage resulting from fire
or other casualty or the elements excepted. Tenant shall remove
all of its trade fixtures, furnishings, equipment and other
personal property from the Leased Premises and shall be
responsible for repairing, at Tenant's sole cost, any damage to
the Leased Premises caused by such removal; provided, however,
Tenant shall not be required to remove the Leasehold
Improvements. Tenant shall be responsible for any loss resulting
from the delay by Tenant in surrendering the Leased Premises at
the end of the term as set forth herein, including any claim made
by any succeeding tenant founded on such delay.
XIX. HOLDING OVER
In the event Tenant remains in possession of the Leased
Premises after the expiration of this Lease with the consent of
Landlord and without the execution of a new lease, it shall be
deemed to be occupying said premises as a tenant from month-to-
month, subject to all of the conditions, provisions and
obligations of this Lease insofar as the same are applicable to a
month-to-month tenancy. Such month-to-month tenancy may be
terminated by either party effective as of the end of any
calendar month by twenty-eight (28) days prior written notice to
the other party. If Tenant remains in possession of the Leased
Premises without the consent and/or acquiescence of Landlord or
remains in possession of the Leased Premises following the
termination of a hold over month-to-month tenancy as created
pursuant to the provisions of the preceding sentence, then Tenant
shall pay to Landlord twice the fixed rent apportioned on a daily
basis for the time Tenant remains in such possession.
XX. WARRANTY OF TITLE: QUIET ENJOYMENT
Landlord hereby represents and warrants that it is the
sole owner of the entire Leased Premises in fee simple and that
it has the right and authority to enter into this Lease without
the joinder or approval of any other person. Landlord covenants
and agrees that so long as Tenant pays the rent reserved by this
Lease and performs and observes all of the covenants and
provisions hereof, Tenant shall peaceably and quietly enjoy the
full possession and use of the Leased Premises, without any
hindrance or molestation from Landlord or any other party.
XXI. ESTOPPEL CERTIFICATES AND SUBORDINATION
1. Each party agrees that it shall, without charge,
at any time and from time to time hereafter, within ten (10) days
after written request of the other, execute in recordable form
and deliver to the other a written statement certifying: (a) as
to whether this Lease has been supplemented or amended, and if
so, the substance and manner of such supplement or amendment; (b)
as to the validity and force and effect of this Lease; (c) as to
the existence of any default thereunder; (d) as to the existence
of any offsets, counterclaims or defenses thereto on the part of
such other party; (e) as to the commencement and expiration dates
of the term of this Lease; (f) as to the date to which rent has
been paid; and (g) as to any other matters as may reasonably be
so requested. Any such certificate may be relied upon by the
party requesting it and any other person, firm or corporation to
whom the same may be exhibited or delivered, and the contents of
such certificate shall be binding on the party executing the
same.
2. This Lease shall, at the option of the holder or
holders of any mortgage or mortgages placed upon the Leased
Premises, be subject and subordinate to the lien of any such
mortgage or mortgages, and Tenant covenants and agrees to execute
and deliver within fifteen (15) days after receipt of a request
therefor such further instruments subordinating this Lease, in
accordance with the foregoing, to the lien of any such mortgage
or mortgages as shall be reasonably requested by Landlord or any
mortgagee or proposed mortgagee; provided, however, no such
subordination shall be effective unless the holder of such
mortgage or mortgages shall have agreed in writing (i) to
recognize the rights of Tenant under this Lease (including
Tenant's right of first refusal under Article XXIII below) in the
event of foreclosure so long as Tenant is not in default
hereunder beyond any applicable grace period, and (ii) in the
event of casualty or condemnation under Articles XII and XIII
above which does not result in the termination of this Lease, the
insurance proceeds and condemnation award, as the case may be,
shall be made available for the repair or restoration of the
Leased Premises pursuant to the terms of this Lease. In the
event that the Leased Premises or any portion thereof is subject
to one or more mortgages at the time of execution of this Lease,
Landlord shall, within forty-five (45) days after the execution
of this Lease, furnish to Tenant a non-disturbance agreement from
the holder(s) of such mortgage(s) containing the agreements in
the immediately preceding sentence. In the event Landlord fails
to deliver to Tenant such non-disturbance within such time, or
within thirty (30) days of notice by Tenant of such failure,
Tenant shall have the right, at its option, to terminate this
Lease and in such event Tenant shall have no liability to
Landlord whatsoever.
XXII. SHORT FORM LEASE
The parties will at any time, at the request of either
one, promptly execute duplicate originals of an instrument in
recordable form, which will constitute a short form of lease,
setting forth a description of the Leased Premises, the term of
this Lease and any other portions thereof, excepting the rental
provisions, as either party may request.
XXIII. MISCELLANEOUS
1. This Lease and the exhibits, if any, attached
hereto and forming a part hereof, set forth all the covenants,
promises, agreements, conditions, and understandings between
Landlord and Tenant concerning the Leased Premises and there are
no others, either oral or written, between them except as herein
set forth. No alteration, amendment, change or addition to this
Lease shall be binding upon Landlord or Tenant unless reduced to
writing and signed by each party.
2. The captions and article numbers appearing in
this Lease are inserted only as a matter of convenience and in no
way define, limit, construe or describe the scope or intent of
such sections or articles of this Lease nor in any way affect
this Lease.
3. Whenever herein the singular number is used, the
same shall include the plural, and the masculine gender shall
include the feminine and neuter genders, and vice versa, as the
context shall require. The terms "Landlord" and "Tenant"
whenever used herein, shall mean only the owner at the time of
Landlord's or Tenant's interest herein, and upon any sale or
assignment of the interest of either Landlord or Tenant herein,
their respective successors in interest and/or assigns shall,
during the term of their ownership of their respective estates
herein, be deemed to be Landlord to Tenant, as the case may be.
4. This Lease may be executed in several
counterparts, each of which shall be an original, but all of
which shall constitute one and the same instrument.
5. This Lease shall be governed by, and construed
in accordance with, the laws of the State of Wisconsin. If any
provision of this Lease or the application thereof to any person
or circumstances shall, to any extent be invalid or
unenforceable, the remainder of this Lease shall not be affected
thereby and each provision of the Lease shall be valid and
enforceable to the fullest extent permitted by the law.
6. Any amount due from Tenant to Landlord hereunder
which is not paid within five (5) days after the date due shall
bear interest at the rate of two percent (2%) per annum in excess
of the then announced prime rate of interest charged by First
Wisconsin National Bank of Milwaukee from the date due until
paid, unless otherwise specifically provided herein, but the
payment of such interest shall not excuse or cure any default by
Tenant under this Lease.
7. The covenant to pay rent is hereby declared to
be an independent covenant on the part of Tenant to be kept and
performed.
8. No payment by Tenant or receipt by Landlord of a
lesser amount than the monthly rent herein stipulated shall be
deemed to be other than on account of the earliest stipulated
rent, nor shall any endorsement or statement on any check or any
letter accompanying any check or payment as rent be deemed an
accord and satisfaction, and Landlord shall accept such check or
payment without prejudice to Landlord's right to recover the
balance of such rent or pursue any other remedy in this Lease
provided.
9. In the event of any sale or other transfer of
the Leased Premises by Landlord, the named Landlord shall be
entirely relieved of all obligations hereunder from and after the
date of the transfer; provided, however, that the transferee
shall assume the same by written agreement and a copy of the same
is delivered to Tenant within ten (10) days thereafter.
10. If Landlord shall fail to perform any covenant
or condition of this Lease upon Landlord's part to be performed
and, as a consequence of any such default, Tenant shall recover a
money judgement against Landlord, such judgement shall be
satisfied only out of the proceeds of sale received upon
execution of such judgement and levied thereon against the right,
title and interest of Landlord in the Leased Premises and out of
rents or other income from such property receivable by Landlord,
and Landlord shall not be liable for any deficiency.
11. Tenant agrees to execute any modification of
this Lease which may be reasonably required by Landlord's lenders
as a condition to making a mortgage loan on the Leased Premises,
provided that no such modification shall alter the rent or term
provided herein nor materially reduce the economic value hereof
or benefits hereunder to Tenant. Tenant agrees to complete and
properly return any such lease modification that may be
reasonably required in connection with any such mortgage loan on
the Leased Premises within ten (10) days after receipt thereof.
12. Except as expressly otherwise provided, all of
the terms, covenants and conditions hereof shall be binding upon
and inure to the benefit of the heirs, personal representatives,
successors in interest and assigns of the parties hereto.
SIGNED AND SEALED as of the date first written above.
LANDLORD:
CENTER CITY PLAZA
By: _/s/ A. William Huelsman
A. William Huelsman,
Its Managing Partner
TENANT:
INTELLIGRAPHICS, INC.
By: _/s/ William D. Nantell
William D. Nantell,
Its President
Attest: _/s/ A. William Huelsman_______
A. William Huelsman,
Its Secretary
AMENDMENT TO LEASES
This Amendment to Leases is made as this 11th day of
August, 1995, by and between Center City Plaza, a Wisconsin
partnership, hereinafter referred to as "Landlord", and
Intelligraphics, Inc., a Wisconsin corporation, hereinafter
referred to as "Tenant."
Landlord and Tenant agree as follows:
Notwithstanding any contrary provisions in any existing
lease by and between Landlord and Tenant, the rental rate
for any extended term of any lease, which extended term
begins after April 30, 1999 shall be the going and
prevailing rent for property of like character which is in
existence at April 30, 1999. The parties shall agree on the
rental to be paid for any extended term by April 30, 1998.
Landlord: CENTER CITY PLAZA
__/s/A. William Huelsman
A. William Huelsman
Its Managing Partner
Tenant: INTELLIGRAPHICS, INC.
/s/ William D. Nantell
William D. Nantell
Its President
LEASE
THIS LEASE is made as of this 1st day of June, 1995, by
and between CENTER CITY PLAZA, a Wisconsin partnership,
hereinafter referred to as "Landlord", and INTELLIGRAPHICS, INC.,
a Wisconsin corporation, hereinafter referred to as "Tenant".
I. DEMISE OF LEASED PREMISES
In consideration of the rents hereinafter reserved and
of the covenants and agreements hereinafter contained, Landlord
does hereby demise and lease unto Tenant, and Tenant does hereby
hire and take from Landlord, all those premises (the "Leased
Premises") with the improvements and appurtenances now or
hereafter located therein, in a building commonly designated as
741 N. Grand Avenue, situated in the City of Waukesha, Waukesha
County, Wisconsin and outlined in red on the plan attached hereto
as Exhibit A. This Lease for the Leased Premises is subject to
municipal and zoning ordinances regulating and restricting the
use of the Leased Premises and construction of any improvements
thereon and recorded covenants, easements and restrictions
affecting the Leased Premises.
II. TERM OF LEASE
1. The term of this Lease shall be for a period of
three years, 11 months commencing on the date (the "Commencement
Date") that Landlord substantially completes construction of the
Project (as defined in Article IV below) and ending at 11:59 p.m.
of the last day of the fourth (4th) Lease Year (as hereinafter
defined), unless sooner terminated in accordance with this Lease
or extended pursuant to Paragraph 2 below. Landlord shall use
all reasonable efforts to ensure that the Project is completed on
or before June 1, 1995. If Landlord's work on account of
construction of the Project is not completed on or before August
1, 1995, for any reason whatsoever, then Tenant may, at Tenant's
sole option, terminate and cancel this Lease by written notice to
Landlord within thirty (30) days thereafter, in which event
neither party shall have any further rights or obligations under
this Lease. As used herein, "Lease Year" shall mean a period of
twelve (12) full and consecutive calendar months except that the
initial Lease Year shall begin on the Commencement Date and end
on April 30, 1996; provided, however, if the Commencement Date
does not occur on the first day of a calendar month, then the
initial Lease Year shall begin on the Commencement Date. Each
succeeding Lease Year shall begin upon the termination of the
preceding Lease Year. The parties shall, at the request of
either, execute and deliver an instrument confirming the
Commencement Date and expiration date when determined.
2. Tenant shall have the option to extend the term of
this Lease for two (2) additional and consecutive five (5) year
periods, the first option commencing upon the expiration of the
initial term, and the second option commencing on the expiration
of the first option. The first option shall be exercised only by
Tenant giving Landlord written notice thereof which is received
by Landlord not less than twelve (12) months prior to the
expiration of the initial term of this Lease, and the second
option shall be exercised only by Tenant giving Landlord written
notice thereof which is received by Landlord not less than twelve
(12) months prior to the expiration of the first option;
provided, however, Tenant shall be entitled to exercise the
options granted herein and the term of this Lease shall, in fact,
be extended only if this Lease is in full force and effect and
Tenant is not in default of any material term of this Lease
beyond any applicable cure period at the times set forth herein
for the exercise of the option and the commencement of the
extension period. Time shall be of the essence with respect to
Tenant's notice(s) as aforesaid. Tenant's failure to exercise
the first option granted herein in accordance with this Paragraph
shall extinguish the second option. In the event that the term
of this Lease is, in fact, extended pursuant to the foregoing,
then any such extension shall be upon all of the same terms and
provisions contained in this Lease including the adjustment in
the fixed annual rent as set forth in Article III, Paragraph 1
below.
III. RENTAL
1. Commencing on the Commencement Date and continuing
until the end of the first Lease Year, Tenant shall pay to
Landlord a fixed annual rent of $17,955.00 per year, payable on
or before the first day of each month during such period in equal
monthly installments of $1,496.25 each. If the Commencement Date
shall not be on the first day of a month, then the rent payable
for the first partial month shall be prorated on a daily basis.
On May 1, 1996, and on the first day of each Lease Year
thereafter, the fixed rent payable by Tenant to Landlord as
aforesaid shall be adjusted to an amount equal to the fixed rent
payable immediately prior to the adjustment date in question,
increased by seventy-five percent (75%) of the percentage
increase, if any, in the Cost of Living Index (as hereinafter
defined) for the month last published immediately preceding the
date for which the comparison is being made over the Cost of
Living Index published for the identical month in the preceding
year. The fixed annual rent as adjusted pursuant to the
foregoing shall be payable in advance in equal monthly
installments on or before the first day of each calendar month.
"Cost of Living Index" as used herein shall mean the index
presently known as "Consumer Price Index, U.S. Average, All
Items, All Urban Consumers (1982-84=100)" published by the Bureau
of Labor Statistics, United States Department of Labor. If the
computation and publication of the Cost of Living Index is
transferred to another governmental bureau, such bureau's
publication shall be substituted for the presently published
index. If the Cost of Living Index is substantially revised, or
its method of calculation is substantially altered, adjustments
shall be made to such new index by Landlord as may be necessary
to make it comparable to the original index used; provided,
however, that the addition or elimination of particular items or
commodities included in the Cost of Living Index shall not be
deemed a "substantial" revision or a "substantial" alteration of
its method of calculation. In the event the Bureau of Labor
Statistics or other governmental bureau to whom the publication
of the Cost of Living Index is transferred publishes such
adjustment, then such adjustment as published shall be
controlling upon the parties. In the event the Cost of Living
Index is discontinued, Landlord and Tenant shall accept
comparable statistics on the purchasing power of the consumer
dollar as published at the time of such discontinuation by a
responsible financial periodical of recognized authority to be
then chosen by the parties.
2. The rent and all other sums payable by Tenant
hereunder shall be paid to Landlord, without notice, at the
address as hereinafter designated for notices to Landlord or at
such other place as Landlord may from time to time designate. It
is intended hereby that all rent payable under the terms of this
Lease shall be an absolute net return to Landlord for the Lease
term free from any expense, charge, offset, abatement, or
deduction whatsoever except as expressly set forth herein.
IV. CONSTRUCTION OF LEASED PREMISES
1. Landlord shall, at its expense, improve the Leased
Premises by constructing therein office premises (the "Project")
in accordance with the plans and specifications. It is expressly
understood and agreed that notwithstanding Tenant's approval of
the Plans and Specifications, Tenant shall have no liability
whatsoever for any defects, errors or omissions in the
documentation furnished by it to Landlord or as a result of its
approval of the Plans and Specifications prepared by Landlord's
architect.
2. Promptly after execution of this Lease, Landlord
shall make application for all required permits from the
appropriate governmental authorities having jurisdiction over the
Leased Premises for the construction of the Project and
thereafter Landlord shall diligently pursue the same and use its
good faith efforts to secure such permits. After Landlord has
obtained necessary permits, Landlord shall promptly commence and
shall diligently proceed with the construction of the Project in
order to complete the same at the earliest possible date
consistent with sound construction practices. No changes shall
be made to the Plans and Specifications or the construction work
to be performed by Landlord without the written approval of
Landlord and Tenant, which approval shall specify without
limitation any additional cost and the effect of such change on
the completion date. Tenant shall advise Landlord in writing of
the name of its designated represen-tative for the purpose of
granting such approvals as are necessary, and Tenant shall have
the right to change such representative from time to time upon
written notice to Landlord.
3. Landlord's work on account of construction of the
Project shall be done in a good and workmanlike manner in
compliance with the Plans and Specifications and all building
codes and regulations. Landlord shall keep Tenant informed on a
regular basis (but no less often than monthly) as to the progress
of construction and Tenant shall at all times have access to the
work and the Plans and Specifications to inspect and review the
same, provided that any inspection or entry by Tenant shall not
unreasonably interfere with or unduly delay Landlord's
construction work, and Tenant waives all claims against Landlord
for personal injury or property damage, and indemnifies and holds
Landlord harmless from all claims, liabilities, damages and
expenses (including reasonable attorneys' fees), resulting from
any such inspection or entry except to the extent due to the
negligence or willful misconduct of Landlord, its agents,
employees or contractors. Landlord covenants that upon
completion of such construction work, the Leased Premises shall
be in compliance with all laws, codes and ordinances. Within
thirty (30) days following delivery of possession of the Leased
Premises to Tenant, Tenant may inspect the same and generate a
punch list of those portions of the work which, in Tenant's
reasonable estimation, are incomplete or not substantially in
conformance with the Plans and Specifications, and Landlord shall
complete or remedy the same within a reasonable time following
the receipt of such list. Further, Landlord shall promptly
correct, repair and/or replace any defective workmanship and/or
material in the Project of which Tenant notifies Landlord within
one (1) year after possession of the Leased Premises is delivered
to Tenant, and Landlord shall correct, repair and/or replace any
latent defects in the Project. Landlord agrees that any
guarantees or warranties received by Landlord from the general
contractor and any subcontractor, supplier or materialmen with
respect to the construction of the Project shall be assigned to
Tenant, and Landlord shall, upon demand from the Tenant, join
with Tenant in enforcing the same.
4. Landlord shall give Tenant written notice upon
completion of construction of the Project accompanied by (i) a
certificate from Landlord's architect certifying that the Leased
Premises have been completed in accordance with the Plans and
Specifications and (ii) an occupancy permit for occupancy of the
Leased Premises. Landlord agrees that during the course of
constructing the Project on the Leased Premises, Tenant may enter
the same for the purpose of installing its fixtures and equipment
to whatever extent it may be practical so to do without
interfering with the completion of the Project and without being
guilty of or liable for trespass, rent, use or occupancy.
V. USE OF LEASED PREMISES
1. The Leased Premises shall be used for offices and
other uses ancillary thereto or for any other lawful purpose.
2. The use of the Leased Premises shall be in full
compliance with, and Tenant shall, at its own cost and expense,
promptly observe and comply with, all present and future laws,
ordinances, rules, regulations and requirements of all public
authorities having jurisdiction over the Leased Premises relating
to or affecting the Leased Premises or its use, and Tenant shall,
at its own cost and expense, make all additions, alterations or
changes to the Leased Premises as may be required by any
governmental authority. Notwithstanding the foregoing, Tenant
shall have the right to contest by appropriate legal proceedings
diligently conducted in good faith, in the name of Tenant, or
Landlord (if legally required), or both (if legally required),
without cost or expense to Landlord, the validity or application
of any such law, ordinance, rule, regulation or requirement and
if compliance therewith may legally be delayed pending the
prosecution of any such proceeding, Tenant may delay such
compliance therewith until the final determination of such
proceeding provided that Tenant shall have furnished Landlord
with a bond of a surety company reasonably satisfactory to
Landlord or other security adequate in the reasonable opinion of
Landlord to assure compliance will occur if Tenant's contest is
unsuccessful. Landlord agrees to execute and deliver any
appropriate papers or other instruments which may be necessary or
proper to permit Tenant so to contest the validity or application
of any such law, ordinance, rule, regulation or requirement and
to fully cooperate with Tenant in such contest.
3. In the event any Hazardous Material (as
hereinafter defined) is brought into or onto the Leased Premises
by anyone other than Landlord, its agents or employees, Tenant
shall handle any such material in compliance with all applicable
federal, state and/or local regulations. For purposes of this
Section, "Hazardous Material" means and includes any hazardous,
toxic or dangerous waste, substance or material defined as such
in (or for purposes of) the Comprehensive Environmental Response,
Compensation, and Liability Act, any so-called "Superfund" or
"Superlien" law, or any federal, state or local statute, law,
ordinance, code, rule, regulation, order or decree regulating,
relating to or imposing liability or standards of conduct
concerning, any hazardous, toxic or dangerous waste, substance or
material, as now or at any time hereafter in effect. Tenant
agrees to indemnify and hold Landlord harmless from any
liability, claim, damage or expense (including reasonable
attorneys' fees) which Landlord may suffer or incur as a result
of the presence or introduction of any Hazardous Material onto
the Premises unless introduced by Landlord, its agents or
employees. Landlord agrees to indemnify and hold Tenant harmless
from any liability, claim, damage or expense (including
reasonable attorneys' fees) which Tenant may suffer or incur as a
result of Landlord's introduction of any Hazardous Material onto
the Leased Premises. The foregoing covenants and
indemnifications shall survive the expiration of the term of this
Lease.
VI. MAINTENANCE AND REPAIRS
Except for repairs and replacements which are the
obligation of Landlord under Article IV, Paragraph 3 and under
Article VII, Paragraph 3, Tenant shall, at all times during the
term of this Lease, and at its own cost and expense, make all
necessary repairs and replacements to keep and maintain the
Leased Premises in good and sanitary order, condition and repair,
ordinary wear and tear excepted, and Tenant shall use all
reasonable precaution to prevent waste, damage or injury thereto.
Tenant shall not defer any repairs or replacements to the Leased
Premises which are Tenant's obligation hereunder in anticipation
of the expiration of the Lease term. Tenant's obligations under
this paragraph shall survive the expiration or earlier
termination of this Lease. In any event, Landlord shall not be
required to make any replacement to the Leased Premises during
the term hereof or any extension, except as provided in Article
IV, Paragraph 3 and Article VII, Paragraph 3, of this Lease.
VII. UTILITIES AND SERVICES
1. Landlord shall be responsible for and shall pay
when due all charges for non-hazardous trash removal, elevator
services, gas, water and sanitary sewer used or consumed in the
Leased Premises. In no event shall Landlord be liable for an
interruption or failure in the supply of any utility to the
Leased Premises.
2. Tenant shall be responsible for and shall pay when
due all charges for electric power (including that used for air
conditioning), telephone service, and janitorial services
provided in the Leased Premises.
3. Landlord shall be responsible for and shall pay
when due all charges for maintenance of equipment for heating,
air conditioning and ventilation systems; charges for snow
plowing, grounds maintenance, and cleaning and maintenance of
common areas. VIII. ALTERATIONS
1. Tenant shall not make any alterations, additions
or improvements to the Leased Premises without procuring
Landlord's prior written consent and delivering to Landlord the
Plans and Specifications therefor. Notwithstanding the
foregoing, Landlord's consent shall not be required for minor
alterations or for alterations which do not affect the exterior
appearance or structural integrity of the Leased Premises. Any
alterations, additions and improvements installed or placed upon
the Leased Premises by Tenant must be made in a good and
workmanlike manner in accordance with the laws, ordinances and
codes relating thereto. Any such alterations, additions and
improvements may be removed by Tenant at any time provided Tenant
repairs any damage to the Leased Premises resulting from such
removal.
2. Tenant shall not suffer or permit any liens under
any construction lien law or similar law to be filed or recorded
against the Leased Premises or against the interest of either
Landlord or Tenant therein. If any such lien at any time be
filed or recorded, Tenant shall promptly obtain the release of
record of such lien or bond over such lien as required by
statute, at Tenant's own cost and expense, if Tenant disputes the
validity of such lien.
IX. SIGNS
Tenant shall have the right to erect, maintain and
replace such signs at the entrance to the Leased Premises as
Tenant may desire, provided that Tenant submits plans for
architectural approval by the Landlord and that such signs shall
comply with all applicable ordinances and requirements of
governmental authorities having jurisdiction. As used in this
Article, the word "sign" shall be construed to include any
placard, light or other advertising symbol or object,
irrespective of whether the same is temporary or permanent. At
the expiration or earlier termination of this Lease, Tenant
shall, at its own expense, remove all signs installed by Tenant
on the Leased Premises and repair any damage to the Leased
Premises resulting from such removal.
X. INSURANCE
1. Tenant shall, during the entire term of this
Lease, keep in full force and effect a policy of commercial
general liability insurance with respect to the Leased Premises
and including contractual liability for the indemnification
obligations of Tenant contained in this Lease in an amount of not
less than $2,000,000.00 combined single limit. The insurance
policy shall name Tenant, Landlord and Landlord's mortgagee, if
any, as insured as their interests appear. Such insurance shall
contain a clause that the insurer will not cancel or change the
insurance without first giving Landlord thirty (30) days prior
written notice. Such insurance may be furnished by Tenant under
any blanket policy carried by it or under a separate policy
therefor. The insurance shall be written by insurance companies
licensed to do business in Wisconsin and reasonably acceptable to
Landlord and a copy of the paid-up policy evidencing such
insurance or a certificate of insurance certifying to the
issuance of such policy shall be delivered to Landlord prior to
commencement of the term of this Lease, and such delivery shall
also be made upon renewal of such policy not less than thirty
(30) days prior to the expiration of such coverage.
2. Tenant shall, at its own cost, during the Lease
term carry insurance against fire, vandalism, malicious mischief
and such other perils as are from time to time included in a
standard extended coverage endorsement insuring any betterments
and improvements made by Tenant to the Leased Premises and all
trade fixtures, furnishings, equipment and all other items of
personal property located at the Leased Premises.
3. Landlord shall not be responsible or liable to
Tenant for any loss or damage to any property, fixtures, or other
improvements on the Leased Premises from any cause whatsoever
including but not limited to the negligent acts or omissions of
Landlord. Landlord shall not be responsible or liable to Tenant
for any personal injury to Tenant or its agents, employees,
contractors, guests, invitees, licensees or customers within or
about the Leased Premises from any cause whatsoever except to the
extent the same results from the negligence or intentional
misconduct of Landlord, its agents or employees.
4. Landlord and Tenant hereby expressly waive any
right of recovery each party may have against the other for a
loss to the Leased Premises or its contents, to the extent of
insurance proceeds actually collected, due to fire or any peril
included in the coverage of any applicable insurance policy
required to be carried hereunder, however caused, including such
losses as may be due to the negligence of Landlord or Tenant or
their respective agents or employees. All policies of insurance
required to be carried hereunder shall contain a provision that
they are not invalidated by the foregoing waiver, but such
waivers shall cease to be effective if the existence thereof
precludes either party from obtaining any such policy.
XI. DESTRUCTION OF IMPROVEMENTS
1. In the event the Leased Premises are damaged or
destroyed in whole or in part by fire or any other cause
whatsoever during the term of this Lease, Landlord shall promptly
repair and restore the Leased Premises which Landlord furnished
upon the commencement of the Lease term to substantially the same
condition that existed just prior to its damage or destruction,
unless this Lease is terminated as hereinafter provided, and the
fixed rent shall be abated in proportion to the portion of the
Leased Premises which is untenantable until the Leased Premises
are repaired by Landlord. The work of rebuilding or repair shall
be initiated by Landlord with all reasonable dispatch, diligently
proceeded with to completion, and Tenant shall repair or replace
its trade fixtures, furnishings and equipment to return them to
substantially the same condition that existed prior to their
damage or destruction. In no event shall Landlord be required to
repair or replace the betterments and improvements installed in
the Leased Premises by Tenant or the trade fixtures, furnishings,
equipment and other personal property located at the Leased
Premises.
2. Notwithstanding anything to the contrary contained
in this Article, in the event that the rebuilding, restoring or
repair of the Leased Premises to tenantable condition would
require more than one hundred eighty (180) days to complete after
commence-ment of the work (subject to extension for delays caused
by acts of God, strikes, lockouts, shortages of materials and/or
workmen or other causes beyond the reasonable control of
Landlord) or in the event that the damage or destruction to the
Leased Premises occurs during the last two years of the Lease
term and would require more than ninety (90) days to complete
after commencement of the work, then either party may terminate
and cancel this Lease by giving written notice to the other
within sixty (60) days after the occur-rence of such damage or
destruction. In the event of any such termination, all proceeds
of insurance maintained by Tenant pur-suant to Article XI,
Paragraph 2 shall be the property of Tenant.
XII. EMINENT DOMAIN
1. If the entire Leased Premises is taken by any
public authority under power of condemnation or sold to any
public authority in lieu of condemnation, then this Lease shall
terminate as of the date possession is taken by the acquiring
authority and rent shall be apportioned as of that date. If (i)
a portion of the Leased Premises is taken or sold and said taking
or sale results in making the Leased Premises unsuitable for the
use contemplated herein, then Tenant, at its option, may
terminate and cancel this Lease as of the date of taking by
giving Landlord written notice of termination within sixty (60)
days after the date of taking, and the rent shall be apportioned
as of said date. In the event this Lease is not terminated upon
a partial taking of the Leased Premises, Landlord shall, to the
extent possible, promptly commence and pursue diligently until
completion the restoration of the remaining portion of the Leased
Premises which Landlord furnished upon the commencement of the
Lease term to the condition the same were in immediately prior to
such taking and this Lease shall continue in full force and
effect. Landlord shall use such portion of Landlord's proceeds
by reason of such taking necessary to repair and restore the
Leased Premises as herein provided, but in no event shall
Landlord be obligated to expend for such repairs an amount in
excess of the condemnation proceeds available to Landlord for
such rebuilding. During the period in which Landlord is
repairing and restoring the Leased Premises pursuant to this
Paragraph, the rental payable by Tenant shall be apportioned and
prorated in order to abate in proportion to the area of the
Leased Premises which is untenantable.
2. All damages awarded for a total or partial taking
of the Leased Premises shall belong to and be the sole property
of Landlord, and Tenant shall have no claim for loss of its
leasehold estate or the value of the unexpired term hereof;
provided, however, Tenant shall be entitled to pursue any
separate claim or claims as Tenant may have for relocation
expenses, business interruption and other items which are not
included in the award payable to Landlord.
3. In the event that this Lease does not terminate
after any part of the Leased Premises is taken or condemned,
there shall be a reduction in basic rent equal to the percentage
of the square footage area of the Leased Premises which is taken
or condemned.
4. Notwithstanding anything to the contrary contained
herein, if a portion of the Leased Premises is taken or condemned
and this Lease continues in full force and effect, then the fixed
annual rent payable hereunder shall be reduced by a pro rata
reduction based on the reduction in the area of the Leased
Premises which is tenantable.
XIII. ASSIGNMENT AND SUBLETTING
Tenant may assign this Lease or any estate or interest
therein or sublease the Leased Premises or any part thereof and
permit the use and occupancy of the Leased Premises or any part
thereof by any subsidiary or related corporation provided,
however, (i) Tenant shall not be released from any of its
obligations under this Lease upon the occurrence of any of the
foregoing events, (ii) in the event of an assignment, the
assignee shall assume the obligations of Tenant under this Lease
from and after the date of assignment, (iii) Tenant shall give
Landlord prior written notice of the proposed transaction and
Landlord shall be furnished with a copy of any such assignment or
sublease agreement, (iv) any such sublease shall be expressly
subject and subordinate to this Lease, and (v) at the time of the
proposed assignment or sublease Tenant shall not be in default of
the payment of rent due hereunder beyond any cure period.
XIV. NOTICES
All notices and demands by either party to the other
shall be given in writing and sent by United States certified
mail, postage prepaid, and addressed:
To Landlord: Center City Plaza
c/o Berg Management Company
235 W. Broadway, Suite 10
Waukesha, WI 53186
To Tenant: Intelligraphics, Inc.
741 N. Grand Avenue
Waukesha, WI 53186
Either party may, upon prior written notice to the
other, specify a different address for the giving of notice.
XV. ACCESS
Landlord or Landlord's agent shall have the right to
enter the Leased Premises after reasonable notice to Tenant
during normal business hours (except in the event of an emergency
in which event no prior notice is required) for the purpose of
inspecting the same or making repairs which are the obligation of
Landlord hereunder, provided, however, Landlord shall use all
reasonable efforts to avoid interference with the conduct of
Tenant's activities thereon.
XVI. DEFAULTS
1. If (a) Tenant shall fail to pay the rental or
other charges due hereunder within five (5) days after receipt of
written notice thereof by Tenant (provided, however, in the event
that Landlord gives Tenant one such notice within any twelve (12)
month period, Landlord shall not be required to give such notice
thereafter during such twelve month period), or (b) Tenant shall
fail to perform any of the other terms, conditions or covenants
of this Lease to be performed or observed by Tenant for more than
thirty (30) days after receipt by Tenant of written notice from
Landlord specifying in detail the nature of such failure (or such
other reasonable times as necessary if such default is a default
which is susceptible of cure but cannot be cured within thirty
(30) days and Tenant, upon receipt of such notice, promptly and
diligently attempts to effect such cure), (c) Tenant shall be
adjudged bankrupt or insolvent or shall make an assignment for
the benefit of creditors, or (d) a receiver or trustee of
Tenant's property shall be appointed and such receiver or
trustee, as the case may be, shall not be discharged within sixty
(60) days after such appointment, then in any such case, Landlord
may, at its option, upon written notice to Tenant, recover
possession of and re-enter the Leased Premises without accepting
a surrender of the Leased Premises or affecting Tenant's
liability for past rent and other charges due or future rent and
other charges to accrue hereunder. As an alternative, at the
election of Landlord, Landlord shall have the right, upon written
notice to Tenant, to declare this Lease terminated and canceled
and to accept surrender of the Leased Premises (without the need
for any affirmative act or acquiescence by Tenant) without any
further rights or obligations on the part of Landlord or Tenant
(other than Tenant's obligation for rent and other charges due
and owing through the date of termination and the performance of
all of the terms and provisions of this Lease due and owing or
accrued through the date of termination), so that Landlord may
relet the Leased Premises without any right on the part of Tenant
to any credit or payment resulting from any reletting of the
Leased Premises. In the event of any such default, Landlord
shall be entitled to recover from Tenant all other damages
sustained by Landlord on account of the breach of this Lease,
including, but not limited to, the costs incurred by Landlord in
re-entering and recovering possession of the Leased Premises and
the cost of repairs, alterations and brokerage fees connected
with the reletting of the Leased Premises. The provisions herein
shall be in addition and without prejudice to any other rights or
remedies as are available at law or otherwise. Notwithstanding
anything to the contrary contained herein, Landlord shall use
reasonable efforts to mitigate the damages which might arise as a
result of a default by Tenant; and in the event Landlord relets
the Leased Premises, the amount received therefrom prior to
termination of this Lease shall be credited to Tenant after
deducting therefrom Landlord's reasonable expenses.
2. The rights and remedies of Landlord or Tenant
under this Lease shall be cumulative and the exercise of any of
them shall not be exclusive of any other right or remedy provided
by this Lease or allowed by law, and the waiver by Landlord or
Tenant of any breach of any covenant of this Lease shall be
limited to the particular instance and shall not operate or be
deemed to waive any future breach of the same or any other
covenant on the same or any other occasion.
3. No extension of time, forbearance, neglect or
waiver on the part of Landlord or Tenant, as the case may be,
with respect to any one or more of the covenants, terms or
conditions of this Lease, shall be construed as a waiver of any
of the other covenants, terms or conditions of this Lease, or as
an estoppel against Landlord or Tenant, as the case may be.
4. Landlord shall have the right at any time, after
ten (10) days notice to Tenant (or without notice in case of
emergency or in case any fine, penalty, interest or cost may
otherwise be imposed or incurred), to make any payment or perform
any act required of Tenant under any provision of this Lease, and
in exercising such right, to incur necessary and incidental costs
and expenses, including reasonable attorney's fees. Nothing
herein shall imply any obligation on the part of Landlord to make
any payment or perform any act required of Tenant, and the
exercise of the right to so do shall not constitute a release of
any obligation or a waiver of any default. All payments made and
all costs and expenses incurred in connection with any exercise
of such right shall be reimbursed to Landlord by Tenant within
fifteen (15) days after receipt of Landlord's bill therefor. In
the event of nonpayment thereof, Landlord shall have the rights
and remedies it would have hereunder or by law in the case of
nonpayment of rent.
5. In the event of any action or proceeding brought
by either party against the other under this Lease, the
prevailing party shall be entitled to recover all costs and
expenses including reasonable attorney's fees.
6. Should Landlord default in the performance of the
covenants required to be performed by Landlord under this Lease,
Tenant may serve upon Landlord a notice specifying the default
and requiring performance by Landlord within a period of time set
forth in such notice, which shall not be less than thirty (30)
days after receipt of said written notice; provided, however,
Tenant shall have the right (but not the obligation) to remedy
such default without notice in the event of emergency. In the
event of such default by Landlord after notice shall have been
given as aforesaid which is not cured by Landlord within such
thirty (30) day period, then Tenant, in addition to any other
right or remedy Tenant may have at law or equity, shall have the
right (but not the obligation) to cure Landlord's default and
Landlord, within fifteen (15) days after receipt of Tenant's bill
therefor, shall reimburse Tenant the reasonable costs incurred by
Tenant in curing Landlord's default as aforesaid. However, if
any default shall occur which cannot, with due diligence, be
cured within a period of thirty (30) days from and after the
giving of notice as aforesaid, then Landlord shall be deemed to
be complying with such notice if Landlord promptly commences to
take reasonable steps to cure such default during such time
period and proceeds diligently thereafter to in fact cure such
default.
7. Tenant acknowledges that late payment of rent
(fixed rental or additional rental) could result in Landlord's
mortgagee imposing a late charge on Landlord, and, accordingly,
Tenant agrees that, if rent (fixed rental or additional rental)
due hereunder is not paid by the fifth (5th) day after it is due
(or within five (5) days after receipt of written notice of
default if such late payment is the first such late payment
within the past twelve (12) months), then Tenant shall pay upon
demand, as additional rent, a late charge equal to the late
charge, if any, imposed upon Landlord by Landlord's mortgagee.
The foregoing provision for payment of a late charge shall not be
construed to extend the date for payment of any sums required to
be paid by Tenant hereunder or to relieve Tenant of its
obligation to pay all such sums at the time or times herein
stipulated, and neither the demand for, nor collection by,
Landlord of such late charge shall be construed as a cure for
Tenant's default in the payment of rent.
XVII. SURRENDER
On the last day of the term of the lease or on the
sooner termination thereof, Tenant shall peaceably and quietly
surrender the Leased Premises in good order, condition and
repair, reasonable wear and tear and damage resulting from fire
or other casualty or the elements excepted. Tenant shall remove
all of its trade fixtures, furnishings, equipment and other
personal property from the Leased Premises and shall be
responsible for repairing, at Tenant's sole cost, any damage to
the Leased Premises caused by such removal; provided, however,
Tenant shall not be required to remove the Leasehold
Improvements. Tenant shall be responsible for any loss resulting
from the delay by Tenant in surrendering the Leased Premises at
the end of the term as set forth herein, including any claim made
by any succeeding tenant founded on such delay.
XVIII. HOLDING OVER
In the event Tenant remains in possession of the Leased
Premises after the expiration of this Lease with the consent of
Landlord and without the execution of a new lease, it shall be
deemed to be occupying said premises as a tenant from month-to-
month, subject to all of the conditions, provisions and
obligations of this Lease insofar as the same are applicable to a
month-to-month tenancy. Such month-to-month tenancy may be
terminated by either party effective as of the end of any
calendar month by twenty-eight (28) days prior written notice to
the other party. If Tenant remains in possession of the Leased
Premises without the consent and/or acquiescence of Landlord or
remains in possession of the Leased Premises following the
termination of a hold over month-to-month tenancy as created
pursuant to the provisions of the preceding sentence, then Tenant
shall pay to Landlord twice the fixed rent apportioned on a daily
basis for the time Tenant remains in such possession.
XIX. WARRANTY OF TITLE: QUIET ENJOYMENT
Landlord hereby represents and warrants that it is the
sole owner of the entire Leased Premises in fee simple and that
it has the right and authority to enter into this Lease without
the joinder or approval of any other person. Landlord covenants
and agrees that so long as Tenant pays the rent reserved by this
Lease and performs and observes all of the covenants and
provisions hereof, Tenant shall peaceably and quietly enjoy the
full possession and use of the Leased Premises, without any
hindrance or molestation from Landlord or any other party.
XX. ESTOPPEL CERTIFICATES AND SUBORDINATION
1. Each party agrees that it shall, without charge,
at any time and from time to time hereafter, within ten (10) days
after written request of the other, execute in recordable form
and deliver to the other a written statement certifying: (a) as
to whether this Lease has been supplemented or amended, and if
so, the substance and manner of such supplement or amendment; (b)
as to the validity and force and effect of this Lease; (c) as to
the existence of any default thereunder; (d) as to the existence
of any offsets, counterclaims or defenses thereto on the part of
such other party; (e) as to the commencement and expiration dates
of the term of this Lease; (f) as to the date to which rent has
been paid; and (g) as to any other matters as may reasonably be
so requested. Any such certificate may be relied upon by the
party requesting it and any other person, firm or corporation to
whom the same may be exhibited or delivered, and the contents of
such certificate shall be binding on the party executing the
same.
2. This Lease shall, at the option of the holder or
holders of any mortgage or mortgages placed upon the Leased
Premises, be subject and subordinate to the lien of any such
mortgage or mortgages, and Tenant covenants and agrees to execute
and deliver within fifteen (15) days after receipt of a request
therefor such further instruments subordinating this Lease, in
accordance with the foregoing, to the lien of any such mortgage
or mortgages as shall be reasonably requested by Landlord or any
mortgagee or proposed mortgagee; provided, however, no such
subordination shall be effective unless the holder of such
mortgage or mortgages shall have agreed in writing (i) to
recognize the rights of Tenant under this Lease (including
Tenant's right of first refusal under Article XXIII below) in the
event of foreclosure so long as Tenant is not in default
hereunder beyond any applicable grace period, and (ii) in the
event of casualty or condemnation under Articles XII and XIII
above which does not result in the termination of this Lease, the
insurance proceeds and condemnation award, as the case may be,
shall be made available for the repair or restoration of the
Leased Premises pursuant to the terms of this Lease. In the
event that the Leased Premises or any portion thereof is subject
to one or more mortgages at the time of execution of this Lease,
Landlord shall, within forty-five (45) days after the execution
of this Lease, furnish to Tenant a non-disturbance agreement from
the holder(s) of such mortgage(s) containing the agreements in
the immediately preceding sentence. In the event Landlord fails
to deliver to Tenant such non-disturbance within such time, or
within thirty (30) days of notice by Tenant of such failure,
Tenant shall have the right, at its option, to terminate this
Lease and in such event Tenant shall have no liability to
Landlord whatsoever.
XXI. SHORT FORM LEASE
The parties will at any time, at the request of either
one, promptly execute duplicate originals of an instrument in
recordable form, which will constitute a short form of lease,
setting forth a description of the Leased Premises, the term of
this Lease and any other portions thereof, excepting the rental
provisions, as either party may request.
XXII. MISCELLANEOUS
1. This Lease and the exhibits, if any, attached
hereto and forming a part hereof, set forth all the covenants,
promises, agreements, conditions, and understandings between
Landlord and Tenant concerning the Leased Premises and there are
no others, either oral or written, between them except as herein
set forth. No alteration, amendment, change or addition to this
Lease shall be binding upon Landlord or Tenant unless reduced to
writing and signed by each party.
2. The captions and article numbers appearing in this
Lease are inserted only as a matter of convenience and in no way
define, limit, construe or describe the scope or intent of such
sections or articles of this Lease nor in any way affect this
Lease.
3. Whenever herein the singular number is used, the
same shall include the plural, and the masculine gender shall
include the feminine and neuter genders, and vice versa, as the
context shall require. The terms "Landlord" and "Tenant"
whenever used herein, shall mean only the owner at the time of
Landlord's or Tenant's interest herein, and upon any sale or
assignment of the interest of either Landlord or Tenant herein,
their respective successors in interest and/or assigns shall,
during the term of their ownership of their respective estates
herein, be deemed to be Landlord to Tenant, as the case may be.
4. This Lease may be executed in several
counterparts, each of which shall be an original, but all of
which shall constitute one and the same instrument.
5. This Lease shall be governed by, and construed in
accordance with, the laws of the State of Wisconsin. If any
provision of this Lease or the application thereof to any person
or circumstances shall, to any extent be invalid or
unenforceable, the remainder of this Lease shall not be affected
thereby and each provision of the Lease shall be valid and
enforceable to the fullest extent permitted by the law.
6. Any amount due from Tenant to Landlord hereunder
which is not paid within five (5) days after the date due shall
bear interest at the rate of two percent (2%) per annum in excess
of the then announced prime rate of interest charged by First
Wisconsin National Bank of Milwaukee from the date due until
paid, unless otherwise specifically provided herein, but the
payment of such interest shall not excuse or cure any default by
Tenant under this Lease.
7. The covenant to pay rent is hereby declared to be
an independent covenant on the part of Tenant to be kept and
performed.
8. No payment by Tenant or receipt by Landlord of a
lesser amount than the monthly rent herein stipulated shall be
deemed to be other than on account of the earliest stipulated
rent, nor shall any endorsement or statement on any check or any
letter accompanying any check or payment as rent be deemed an
accord and satisfaction, and Landlord shall accept such check or
payment without prejudice to Landlord's right to recover the
balance of such rent or pursue any other remedy in this Lease
provided.
9. In the event of any sale or other transfer of the
Leased Premises by Landlord, the named Landlord shall be entirely
relieved of all obligations hereunder from and after the date of
the transfer; provided, however, that the transferee shall assume
the same by written agreement and a copy of the same is delivered
to Tenant within ten (10) days thereafter.
10. If Landlord shall fail to perform any covenant or
condition of this Lease upon Landlord's part to be performed and,
as a consequence of any such default, Tenant shall recover a
money judgement against Landlord, such judgement shall be
satisfied only out of the proceeds of sale received upon
execution of such judgement and levied thereon against the right,
title and interest of Landlord in the Leased Premises and out of
rents or other income from such property receivable by Landlord,
and Landlord shall not be liable for any deficiency.
11. Tenant agrees to execute any modification of this
Lease which may be reasonably required by Landlord's lenders as a
condition to making a mortgage loan on the Leased Premises,
provided that no such modification shall alter the rent or term
provided herein nor materially reduce the economic value hereof
or benefits hereunder to Tenant. Tenant agrees to complete and
properly return any such lease modification that may be
reasonably required in connection with any such mortgage loan on
the Leased Premises within ten (10) days after receipt thereof.
12. Except as expressly otherwise provided, all of the
terms, covenants and conditions hereof shall be binding upon and
inure to the benefit of the heirs, personal representatives,
successors in interest and assigns of the parties hereto.
SIGNED AND SEALED as of the date first written above.
LANDLORD:
CENTER CITY PLAZA
By: _/s/ A. William Huelsman
A. William Huelsman,
Its Managing Partner
TENANT:
INTELLIGRAPHICS, INC.
By:
/s/ William D. Nantell
William D. Nantell,
Its President
AMENDMENT TO LEASES
This Amendment to Leases is made as this 11th day of
August, 1995, by and between Center City Plaza, a Wisconsin
partnership, hereinafter referred to as "Landlord", and
Intelligraphics, Inc., a Wisconsin corporation, hereinafter
referred to as "Tenant."
Landlord and Tenant agree as follows:
Notwithstanding any contrary provisions in any existing
lease by and between Landlord and Tenant, the rental rate
for any extended term of any lease, which extended term
begins after April 30, 1999 shall be the going and
prevailing rent for property of like character which is in
existence at April 30, 1999. The parties shall agree on the
rental to be paid for any extended term by April 30, 1998.
Landlord: CENTER CITY PLAZA
_/s/ A. William Huelsman_
A. William Huelsman
Its Managing Partner
Tenant: INTELLIGRAPHICS, INC.
/s/ William D. Nantell
William D. Nantell
Its President
LEASE
THIS LEASE is made as of this 10th day of August, 1995,
by and between CENTER CITY PLAZA, a Wisconsin partnership,
hereinafter referred to as "Landlord", and INTELLIGRAPHICS, INC.,
a Wisconsin corporation, hereinafter referred to as "Tenant".
I. DEMISE OF LEASED PREMISES
In consideration of the rents hereinafter reserved and
of the covenants and agreements hereinafter contained, Landlord
does hereby demise and lease unto Tenant, and Tenant does hereby
hire and take from Landlord, all those premises (the "Leased
Premises") with the improvements and appurtenances now or
hereafter located therein, in a building commonly designated as
741 N. Grand Avenue, situated in the City of Waukesha, Waukesha
County, Wisconsin and outlined in red on the plan attached hereto
as Exhibit A. This Lease for the Leased Premises is subject to
municipal and zoning ordinances regulating and restricting the
use of the Leased Premises and construction of any improvements
thereon and recorded covenants, easements and restrictions
affecting the Leased Premises.
II. TERM OF LEASE
1. The term of this Lease shall be for a period of
three years, 7 months commencing on October 1, 1995 and ending at
11:59 p.m. of the last day of the fourth (4th) Lease Year (as
hereinafter defined), unless sooner terminated in accordance with
this Lease or extended pursuant to Paragraph 2 below. As used
herein, "Lease Year" shall mean a period of twelve (12) full and
consecutive calendar months except that the initial Lease Year
shall begin on the Commencement Date and end on April 30, 1996.
Each succeeding Lease Year shall begin upon the termination of
the preceding Lease Year. The parties shall, at the request of
either, execute and deliver an instrument confirming the
Commencement Date and expiration date when determined.
2. Tenant shall have the option to extend the term
of this Lease for two (2) additional and consecutive five (5)
year periods, the first option commencing upon the expiration of
the initial term, and the second option commencing on the
expiration of the first option. The first option shall be
exercised only by Tenant giving Landlord written notice thereof
which is received by Landlord not less than twelve (12) months
prior to the expiration of the initial term of this Lease, and
the second option shall be exercised only by Tenant giving
Landlord written notice thereof which is received by Landlord not
less than twelve (12) months prior to the expiration of the first
option; provided, however, Tenant shall be entitled to exercise
the options granted herein and the term of this Lease shall, in
fact, be extended only if this Lease is in full force and effect
and Tenant is not in default of any material term of this Lease
beyond any applicable cure period at the times set forth herein
for the exercise of the option and the commencement of the
extension period. Time shall be of the essence with respect to
Tenant's notice(s) as aforesaid. Tenant's failure to exercise
the first option granted herein in accordance with this Paragraph
shall extinguish the second option. In the event that the term
of this Lease is, in fact, extended pursuant to the foregoing,
then any such extension shall be upon all of the same terms and
provisions contained in this Lease including the adjustment in
the fixed annual rent as set forth in Article III, Paragraph 1
below.
III. RENTAL
1. Commencing on the Commencement Date and
continuing until May 1, 1996, Tenant shall pay to Landlord at a
fixed annual rent of $40,590.40 per year, payable on or before
the first day of each month during such period in equal monthly
installments of $3,382.53 each. On May 1, 1996, and continuing
until April 30, 1997, Tenant shall pay to Landlord a fixed annual
rent of $45,664.20 per year, payable on or before the first day
of each month during such period in equal monthly installments of
$3,805.35 each. On May 1, 1997, and continuing until April 30,
1998, Tenant shall pay to Landlord a fixed annual rent of
$50,738.00 per year, payable on or before the first day of each
month during such period in equal monthly installments of
$4,228.16 each. On May 1, 1998, and continuing until April 30,
1999, Tenant shall pay to Landlord a fixed annual rent of
$55,811.80 per year, payable on or before the first day of each
month during such period in equal monthly installments of
$4,650.98 each. On May 1, 1999, and on the first day of each
Lease Year thereafter, the fixed rent payable by Tenant to
Landlord as aforesaid shall be adjusted to an amount equal to the
fixed rent payable immediately prior to the adjustment date in
question, increased by seventy-five percent (75%) of the
percentage increase, if any, in the Cost of Living Index (as
hereinafter defined) for the month last published immediately
preceding the date for which the comparison is being made over
the Cost of Living Index published for the identical month in the
preceding year. The fixed annual rent as adjusted pursuant to
the foregoing shall be payable in advance in equal monthly
installments on or before the first day of each calendar month.
"Cost of Living Index" as used herein shall mean the index
presently known as "Consumer Price Index, U.S. Average, All
Items, All Urban Consumers (1982-84=100)" published by the Bureau
of Labor Statistics, United States Department of Labor. If the
computation and publication of the Cost of Living Index is
transferred to another governmental bureau, such bureau's
publication shall be substituted for the presently published
index. If the Cost of Living Index is substantially revised, or
its method of calculation is substantially altered, adjustments
shall be made to such new index by Landlord as may be necessary
to make it comparable to the original index used; provided,
however, that the addition or elimination of particular items or
commodities included in the Cost of Living Index shall not be
deemed a "substantial" revision or a "substantial" alteration of
its method of calculation. In the event the Bureau of Labor
Statistics or other governmental bureau to whom the publication
of the Cost of Living Index is transferred publishes such
adjustment, then such adjustment as published shall be
controlling upon the parties. In the event the Cost of Living
Index is discontinued, Landlord and Tenant shall accept
comparable statistics on the purchasing power of the consumer
dollar as published at the time of such discontinuation by a
responsible financial periodical of recognized authority to be
then chosen by the parties.
2. The rent and all other sums payable by Tenant
hereunder shall be paid to Landlord, without notice, at the
address as hereinafter designated for notices to Landlord or at
such other place as Landlord may from time to time designate. It
is intended hereby that all rent payable under the terms of this
Lease shall be an absolute net return to Landlord for the Lease
term free from any expense, charge, offset, abatement, or
deduction whatsoever except as expressly set forth herein.
IV. IMPROVEMENT OF LEASED PREMISES
1. Tenant shall, at its own cost and expense
(including any expense for permit and all leasehold
improvements), improve the Leased Premises for use by Tenant as
provided in Article V herein.
V. USE OF LEASED PREMISES
1. The Leased Premises shall be used for offices
and other uses ancillary thereto or for any other lawful purpose.
2. The use of the Leased Premises shall be in full
compliance with, and Tenant shall, at its own cost and expense,
promptly observe and comply with, all present and future laws,
ordinances, rules, regulations and requirements of all public
authorities having jurisdiction over the Leased Premises relating
to or affecting the Leased Premises or its use, and Tenant shall,
at its own cost and expense, make all additions, alterations or
changes to the Leased Premises as may be required by any
governmental authority. Notwithstanding the foregoing, Tenant
shall have the right to contest by appropriate legal proceedings
diligently conducted in good faith, in the name of Tenant, or
Landlord (if legally required), or both (if legally required),
without cost or expense to Landlord, the validity or application
of any such law, ordinance, rule, regulation or requirement and
if compliance therewith may legally be delayed pending the
prosecution of any such proceeding, Tenant may delay such
compliance therewith until the final determination of such
proceeding provided that Tenant shall have furnished Landlord
with a bond of a surety company reasonably satisfactory to
Landlord or other security adequate in the reasonable opinion of
Landlord to assure compliance will occur if Tenant's contest is
unsuccessful. Landlord agrees to execute and deliver any
appropriate papers or other instruments which may be necessary or
proper to permit Tenant so to contest the validity or application
of any such law, ordinance, rule, regulation or requirement and
to fully cooperate with Tenant in such contest.
3. In the event any Hazardous Material (as
hereinafter defined) is brought into or onto the Leased Premises
by anyone other than Landlord, its agents or employees, Tenant
shall handle any such material in compliance with all applicable
federal, state and/or local regulations. For purposes of this
Section, "Hazardous Material" means and includes any hazardous,
toxic or dangerous waste, substance or material defined as such
in (or for purposes of) the Comprehensive Environmental Response,
Compensation, and Liability Act, any so-called "Superfund" or
"Superlien" law, or any federal, state or local statute, law,
ordinance, code, rule, regulation, order or decree regulating,
relating to or imposing liability or standards of conduct
concerning, any hazardous, toxic or dangerous waste, substance or
material, as now or at any time hereafter in effect. Tenant
agrees to indemnify and hold Landlord harmless from any
liability, claim, damage or expense (including reasonable
attorneys' fees) which Landlord may suffer or incur as a result
of the presence or introduction of any Hazardous Material onto
the Premises unless introduced by Landlord, its agents or
employees. Landlord agrees to indemnify and hold Tenant harmless
from any liability, claim, damage or expense (including
reasonable attorneys' fees) which Tenant may suffer or incur as a
result of Landlord's introduction of any Hazardous Material onto
the Leased Premises. The foregoing covenants and
indemnifications shall survive the expiration of the term of this
Lease.
VI. MAINTENANCE AND REPAIRS
Except for repairs and replacements which are the
obligation of Landlord under Article VII, Paragraph 3, Tenant
shall, at all times during the term of this Lease, and at its own
cost and expense, make all necessary repairs and replacements to
keep and maintain the Leased Premises in good and sanitary order,
condition and repair, ordinary wear and tear excepted, and Tenant
shall use all reasonable precaution to prevent waste, damage or
injury thereto. Tenant shall not defer any repairs or
replacements to the Leased Premises which are Tenant's obligation
hereunder in anticipation of the expiration of the Lease term.
Tenant's obligations under this paragraph shall survive the
expiration or earlier termination of this Lease. In any event,
Landlord shall not be required to make any replacement to the
Leased Premises during the term hereof or any extension, except
as provided in Article VII, Paragraph 3, of this Lease.
VII. UTILITIES AND SERVICES
1. Landlord shall be responsible for and shall pay
when due all charges for non-hazardous trash removal, elevator
services, gas, water and sanitary sewer used or consumed in the
Leased Premises. In no event shall Landlord be liable for an
interruption or failure in the supply of any utility to the
Leased Premises.
2. Tenant shall be responsible for and shall pay
when due all charges for electric power (including that used for
air conditioning), telephone service, and janitorial services
provided in the Leased Premises.
3. Landlord shall be responsible for and shall pay
when due all charges for maintenance of equipment for heating,
air conditioning and ventilation systems; charges for snow
plowing, grounds maintenance, and cleaning and maintenance of
common areas.
VIII. ALTERATIONS
1. Tenant shall not make any alterations, additions
or improvements to the Leased Premises without procuring
Landlord's prior written consent and delivering to Landlord the
Plans and Specifications therefor. Notwithstanding the
foregoing, Landlord's consent shall not be required for minor
alterations or for alterations which do not affect the exterior
appearance or structural integrity of the Leased Premises. Any
alterations, additions and improvements installed or placed upon
the Leased Premises by Tenant must be made in a good and
workmanlike manner in accordance with the laws, ordinances and
codes relating thereto. Any such alterations, additions and
improvements may be removed by Tenant at any time provided Tenant
repairs any damage to the Leased Premises resulting from such
removal.
2. Tenant shall not suffer or permit any liens
under any construction lien law or similar law to be filed or
recorded against the Leased Premises or against the interest of
either Landlord or Tenant therein. If any such lien at any time
be filed or recorded, Tenant shall promptly obtain the release of
record of such lien or bond over such lien as required by
statute, at Tenant's own cost and expense, if Tenant disputes the
validity of such lien.
IX. SIGNS
Tenant shall have the right to erect, maintain and
replace such signs at the entrance to the Leased Premises as
Tenant may desire, provided that Tenant submits plans for
architectural approval by the Landlord and that such signs shall
comply with all applicable ordinances and requirements of
governmental authorities having jurisdiction. As used in this
Article, the word "sign" shall be construed to include any
placard, light or other advertising symbol or object,
irrespective of whether the same is temporary or permanent. At
the expiration or earlier termination of this Lease, Tenant
shall, at its own expense, remove all signs installed by Tenant
on the Leased Premises and repair any damage to the Leased
Premises resulting from such removal.
X. INSURANCE
1. Tenant shall, during the entire term of this
Lease, keep in full force and effect a policy of commercial
general liability insurance with respect to the Leased Premises
and including contractual liability for the indemnification
obligations of Tenant contained in this Lease in an amount of not
less than $2,000,000.00 combined single limit. The insurance
policy shall name Tenant, Landlord and Landlord's mortgagee, if
any, as insured as their interests appear. Such insurance shall
contain a clause that the insurer will not cancel or change the
insurance without first giving Landlord thirty (30) days prior
written notice. Such insurance may be furnished by Tenant under
any blanket policy carried by it or under a separate policy
therefor. The insurance shall be written by insurance companies
licensed to do business in Wisconsin and reasonably acceptable to
Landlord and a copy of the paid-up policy evidencing such
insurance or a certificate of insurance certifying to the
issuance of such policy shall be delivered to Landlord prior to
commencement of the term of this Lease, and such delivery shall
also be made upon renewal of such policy not less than thirty
(30) days prior to the expiration of such coverage.
2. Tenant shall, at its own cost, during the Lease
term carry insurance against fire, vandalism, malicious mischief
and such other perils as are from time to time included in a
standard extended coverage endorsement insuring any betterments
and improvements made by Tenant to the Leased Premises and all
trade fixtures, furnishings, equipment and all other items of
personal property located at the Leased Premises.
3. Landlord shall not be responsible or liable to
Tenant for any loss or damage to any property, fixtures, or other
improvements on the Leased Premises from any cause whatsoever
including but not limited to the negligent acts or omissions of
Landlord. Landlord shall not be responsible or liable to Tenant
for any personal injury to Tenant or its agents, employees,
contractors, guests, invitees, licensees or customers within or
about the Leased Premises from any cause whatsoever except to the
extent the same results from the negligence or intentional
misconduct of Landlord, its agents or employees.
4. Landlord and Tenant hereby expressly waive any
right of recovery each party may have against the other for a
loss to the Leased Premises or its contents, to the extent of
insurance proceeds actually collected, due to fire or any peril
included in the coverage of any applicable insurance policy
required to be carried hereunder, however caused, including such
losses as may be due to the negligence of Landlord or Tenant or
their respective agents or employees. All policies of insurance
required to be carried hereunder shall contain a provision that
they are not invalidated by the foregoing waiver, but such
waivers shall cease to be effective if the existence thereof
precludes either party from obtaining any such policy.
XI. DESTRUCTION OF IMPROVEMENTS
1. In the event the Leased Premises are damaged or
destroyed in whole or in part by fire or any other cause
whatsoever during the term of this Lease, Landlord shall promptly
repair and restore the Leased Premises which Landlord furnished
upon the commencement of the Lease term to substantially the same
condition that existed just prior to its damage or destruction,
unless this Lease is terminated as hereinafter provided, and the
fixed rent shall be abated in proportion to the portion of the
Leased Premises which is untenantable until the Leased Premises
are repaired by Landlord. The work of rebuilding or repair shall
be initiated by Landlord with all reasonable dispatch, diligently
proceeded with to completion, and Tenant shall repair or replace
its trade fixtures, furnishings and equipment to return them to
substantially the same condition that existed prior to their
damage or destruction. In no event shall Landlord be required to
repair or replace the betterments and improvements installed in
the Leased Premises by Tenant or the trade fixtures, furnishings,
equipment and other personal property located at the Leased
Premises.
2. Notwithstanding anything to the contrary
contained in this Article, in the event that the rebuilding,
restoring or repair of the Leased Premises to tenantable
condition would require more than one hundred eighty (180) days
to complete after commence-ment of the work (subject to extension
for delays caused by acts of God, strikes, lockouts, shortages of
materials and/or workmen or other causes beyond the reasonable
control of Landlord) or in the event that the damage or
destruction to the Leased Premises occurs during the last two
years of the Lease term and would require more than ninety (90)
days to complete after commencement of the work, then either
party may terminate and cancel this Lease by giving written
notice to the other within sixty (60) days after the occur-rence
of such damage or destruction. In the event of any such
termination, all proceeds of insurance maintained by Tenant pur-
suant to Article XI, Paragraph 2 shall be the property of Tenant.
XII. EMINENT DOMAIN
1. If the entire Leased Premises is taken by any
public authority under power of condemnation or sold to any
public authority in lieu of condemnation, then this Lease shall
terminate as of the date possession is taken by the acquiring
authority and rent shall be apportioned as of that date. If (i)
a portion of the Leased Premises is taken or sold and said taking
or sale results in making the Leased Premises unsuitable for the
use contemplated herein, then Tenant, at its option, may
terminate and cancel this Lease as of the date of taking by
giving Landlord written notice of termination within sixty (60)
days after the date of taking, and the rent shall be apportioned
as of said date. In the event this Lease is not terminated upon
a partial taking of the Leased Premises, Landlord shall, to the
extent possible, promptly commence and pursue diligently until
completion the restoration of the remaining portion of the Leased
Premises which Landlord furnished upon the commencement of the
Lease term to the condition the same were in immediately prior to
such taking and this Lease shall continue in full force and
effect. Landlord shall use such portion of Landlord's proceeds
by reason of such taking necessary to repair and restore the
Leased Premises as herein provided, but in no event shall
Landlord be obligated to expend for such repairs an amount in
excess of the condemnation proceeds available to Landlord for
such rebuilding. During the period in which Landlord is
repairing and restoring the Leased Premises pursuant to this
Paragraph, the rental payable by Tenant shall be apportioned and
prorated in order to abate in proportion to the area of the
Leased Premises which is untenantable.
2. All damages awarded for a total or partial
taking of the Leased Premises shall belong to and be the sole
property of Landlord, and Tenant shall have no claim for loss of
its leasehold estate or the value of the unexpired term hereof;
provided, however, Tenant shall be entitled to pursue any
separate claim or claims as Tenant may have for relocation
expenses, business interruption and other items which are not
included in the award payable to Landlord.
3. Notwithstanding anything to the contrary
contained herein, if a portion of the Leased Premises is taken or
condemned and this Lease continues in full force and effect, then
the fixed annual rent payable hereunder shall be reduced by a pro
rata reduction based on the reduction in the area of the Leased
Premises which is tenantable.
XIII. ASSIGNMENT AND SUBLETTING
Tenant may assign this Lease or any estate or interest
therein or sublease the Leased Premises or any part thereof and
permit the use and occupancy of the Leased Premises or any part
thereof by any subsidiary or related corporation provided,
however, (i) Tenant shall not be released from any of its
obligations under this Lease upon the occurrence of any of the
foregoing events, (ii) in the event of an assignment, the
assignee shall assume the obligations of Tenant under this Lease
from and after the date of assignment, (iii) Tenant shall give
Landlord prior written notice of the proposed transaction and
Landlord shall be furnished with a copy of any such assignment or
sublease agreement, (iv) any such sublease shall be expressly
subject and subordinate to this Lease, and (v) at the time of the
proposed assignment or sublease Tenant shall not be in default of
the payment of rent due hereunder beyond any cure period.
XIV. NOTICES
All notices and demands by either party to the other
shall be given in writing and sent by United States certified
mail, postage prepaid, and addressed:
To Landlord: Center City Plaza
c/o Berg Management Company
235 W. Broadway, Suite 10
Waukesha, WI 53186
To Tenant: Intelligraphics, Inc.
741 N. Grand Avenue
Waukesha, WI 53186
Either party may, upon prior written notice to the
other, specify a different address for the giving of notice.
XV. ACCESS
Landlord or Landlord's agent shall have the right to
enter the Leased Premises after reasonable notice to Tenant
during normal business hours (except in the event of an emergency
in which event no prior notice is required) for the purpose of
inspecting the same or making repairs which are the obligation of
Landlord hereunder, provided, however, Landlord shall use all
reasonable efforts to avoid interference with the conduct of
Tenant's activities thereon.
XVI. DEFAULTS
1. If (a) Tenant shall fail to pay the rental or
other charges due hereunder within five (5) days after receipt of
written notice thereof by Tenant (provided, however, in the event
that Landlord gives Tenant one such notice within any twelve (12)
month period, Landlord shall not be required to give such notice
thereafter during such twelve month period), or (b) Tenant shall
fail to perform any of the other terms, conditions or covenants
of this Lease to be performed or observed by Tenant for more than
thirty (30) days after receipt by Tenant of written notice from
Landlord specifying in detail the nature of such failure (or such
other reasonable times as necessary if such default is a default
which is susceptible of cure but cannot be cured within thirty
(30) days and Tenant, upon receipt of such notice, promptly and
diligently attempts to effect such cure), (c) Tenant shall be
adjudged bankrupt or insolvent or shall make an assignment for
the benefit of creditors, or (d) a receiver or trustee of
Tenant's property shall be appointed and such receiver or
trustee, as the case may be, shall not be discharged within sixty
(60) days after such appointment, then in any such case, Landlord
may, at its option, upon written notice to Tenant, recover
possession of and re-enter the Leased Premises without accepting
a surrender of the Leased Premises or affecting Tenant's
liability for past rent and other charges due or future rent and
other charges to accrue hereunder. As an alternative, at the
election of Landlord, Landlord shall have the right, upon written
notice to Tenant, to declare this Lease terminated and canceled
and to accept surrender of the Leased Premises (without the need
for any affirmative act or acquiescence by Tenant) without any
further rights or obligations on the part of Landlord or Tenant
(other than Tenant's obligation for rent and other charges due
and owing through the date of termination and the performance of
all of the terms and provisions of this Lease due and owing or
accrued through the date of termination), so that Landlord may
relet the Leased Premises without any right on the part of Tenant
to any credit or payment resulting from any reletting of the
Leased Premises. In the event of any such default, Landlord
shall be entitled to recover from Tenant all other damages
sustained by Landlord on account of the breach of this Lease,
including, but not limited to, the costs incurred by Landlord in
re-entering and recovering possession of the Leased Premises and
the cost of repairs, alterations and brokerage fees connected
with the reletting of the Leased Premises. The provisions herein
shall be in addition and without prejudice to any other rights or
remedies as are available at law or otherwise. Notwithstanding
anything to the contrary contained herein, Landlord shall use
reasonable efforts to mitigate the damages which might arise as a
result of a default by Tenant; and in the event Landlord relets
the Leased Premises, the amount received therefrom prior to
termination of this Lease shall be credited to Tenant after
deducting therefrom Landlord's reasonable expenses.
2. The rights and remedies of Landlord or Tenant
under this Lease shall be cumulative and the exercise of any of
them shall not be exclusive of any other right or remedy provided
by this Lease or allowed by law, and the waiver by Landlord or
Tenant of any breach of any covenant of this Lease shall be
limited to the particular instance and shall not operate or be
deemed to waive any future breach of the same or any other
covenant on the same or any other occasion.
3. No extension of time, forbearance, neglect or
waiver on the part of Landlord or Tenant, as the case may be,
with respect to any one or more of the covenants, terms or
conditions of this Lease, shall be construed as a waiver of any
of the other covenants, terms or conditions of this Lease, or as
an estoppel against Landlord or Tenant, as the case may be.
4. Landlord shall have the right at any time, after
ten (10) days notice to Tenant (or without notice in case of
emergency or in case any fine, penalty, interest or cost may
otherwise be imposed or incurred), to make any payment or perform
any act required of Tenant under any provision of this Lease, and
in exercising such right, to incur necessary and incidental costs
and expenses, including reasonable attorney's fees. Nothing
herein shall imply any obligation on the part of Landlord to make
any payment or perform any act required of Tenant, and the
exercise of the right to so do shall not constitute a release of
any obligation or a waiver of any default. All payments made and
all costs and expenses incurred in connection with any exercise
of such right shall be reimbursed to Landlord by Tenant within
fifteen (15) days after receipt of Landlord's bill therefor. In
the event of nonpayment thereof, Landlord shall have the rights
and remedies it would have hereunder or by law in the case of
nonpayment of rent.
5. In the event of any action or proceeding brought
by either party against the other under this Lease, the
prevailing party shall be entitled to recover all costs and
expenses including reasonable attorney's fees.
6. Should Landlord default in the performance of
the covenants required to be performed by Landlord under this
Lease, Tenant may serve upon Landlord a notice specifying the
default and requiring performance by Landlord within a period of
time set forth in such notice, which shall not be less than
thirty (30) days after receipt of said written notice; provided,
however, Tenant shall have the right (but not the obligation) to
remedy such default without notice in the event of emergency. In
the event of such default by Landlord after notice shall have
been given as aforesaid which is not cured by Landlord within
such thirty (30) day period, then Tenant, in addition to any
other right or remedy Tenant may have at law or equity, shall
have the right (but not the obligation) to cure Landlord's
default and Landlord, within fifteen (15) days after receipt of
Tenant's bill therefor, shall reimburse Tenant the reasonable
costs incurred by Tenant in curing Landlord's default as
aforesaid. However, if any default shall occur which cannot,
with due diligence, be cured within a period of thirty (30) days
from and after the giving of notice as aforesaid, then Landlord
shall be deemed to be complying with such notice if Landlord
promptly commences to take reasonable steps to cure such default
during such time period and proceeds diligently thereafter to in
fact cure such default.
7. Tenant acknowledges that late payment of rent
(fixed rental or additional rental) could result in Landlord's
mortgagee imposing a late charge on Landlord, and, accordingly,
Tenant agrees that, if rent (fixed rental or additional rental)
due hereunder is not paid by the fifth (5th) day after it is due
(or within five (5) days after receipt of written notice of
default if such late payment is the first such late payment
within the past twelve (12) months), then Tenant shall pay upon
demand, as additional rent, a late charge equal to the late
charge, if any, imposed upon Landlord by Landlord's mortgagee.
The foregoing provision for payment of a late charge shall not be
construed to extend the date for payment of any sums required to
be paid by Tenant hereunder or to relieve Tenant of its
obligation to pay all such sums at the time or times herein
stipulated, and neither the demand for, nor collection by,
Landlord of such late charge shall be construed as a cure for
Tenant's default in the payment of rent.
XVII. SURRENDER
On the last day of the term of the lease or on the
sooner termination thereof, Tenant shall peaceably and quietly
surrender the Leased Premises in good order, condition and
repair, reasonable wear and tear and damage resulting from fire
or other casualty or the elements excepted. Tenant shall remove
all of its trade fixtures, furnishings, equipment and other
personal property from the Leased Premises and shall be
responsible for repairing, at Tenant's sole cost, any damage to
the Leased Premises caused by such removal; provided, however,
Tenant shall not be required to remove the Leasehold
Improvements. Tenant shall be responsible for any loss resulting
from the delay by Tenant in surrendering the Leased Premises at
the end of the term as set forth herein, including any claim made
by any succeeding tenant founded on such delay.
XVIII. HOLDING OVER
In the event Tenant remains in possession of the Leased
Premises after the expiration of this Lease with the consent of
Landlord and without the execution of a new lease, it shall be
deemed to be occupying said premises as a tenant from month-to-
month, subject to all of the conditions, provisions and
obligations of this Lease insofar as the same are applicable to a
month-to-month tenancy. Such month-to-month tenancy may be
terminated by either party effective as of the end of any
calendar month by twenty-eight (28) days prior written notice to
the other party. If Tenant remains in possession of the Leased
Premises without the consent and/or acquiescence of Landlord or
remains in possession of the Leased Premises following the
termination of a hold over month-to-month tenancy as created
pursuant to the provisions of the preceding sentence, then Tenant
shall pay to Landlord twice the fixed rent apportioned on a daily
basis for the time Tenant remains in such possession.
XIX. WARRANTY OF TITLE: QUIET ENJOYMENT
Landlord hereby represents and warrants that it is the
sole owner of the entire Leased Premises in fee simple and that
it has the right and authority to enter into this Lease without
the joinder or approval of any other person. Landlord covenants
and agrees that so long as Tenant pays the rent reserved by this
Lease and performs and observes all of the covenants and
provisions hereof, Tenant shall peaceably and quietly enjoy the
full possession and use of the Leased Premises, without any
hindrance or molestation from Landlord or any other party.
XX. ESTOPPEL CERTIFICATES AND SUBORDINATION
1. Each party agrees that it shall, without charge,
at any time and from time to time hereafter, within ten (10) days
after written request of the other, execute in recordable form
and deliver to the other a written statement certifying: (a) as
to whether this Lease has been supplemented or amended, and if
so, the substance and manner of such supplement or amendment; (b)
as to the validity and force and effect of this Lease; (c) as to
the existence of any default thereunder; (d) as to the existence
of any offsets, counterclaims or defenses thereto on the part of
such other party; (e) as to the commencement and expiration dates
of the term of this Lease; (f) as to the date to which rent has
been paid; and (g) as to any other matters as may reasonably be
so requested. Any such certificate may be relied upon by the
party requesting it and any other person, firm or corporation to
whom the same may be exhibited or delivered, and the contents of
such certificate shall be binding on the party executing the
same.
2. This Lease shall, at the option of the holder or
holders of any mortgage or mortgages placed upon the Leased
Premises, be subject and subordinate to the lien of any such
mortgage or mortgages, and Tenant covenants and agrees to execute
and deliver within fifteen (15) days after receipt of a request
therefor such further instruments subordinating this Lease, in
accordance with the foregoing, to the lien of any such mortgage
or mortgages as shall be reasonably requested by Landlord or any
mortgagee or proposed mortgagee; provided, however, no such
subordination shall be effective unless the holder of such
mortgage or mortgages shall have agreed in writing (i) to
recognize the rights of Tenant under this Lease (including
Tenant's right of first refusal under Article XXIII below) in the
event of foreclosure so long as Tenant is not in default
hereunder beyond any applicable grace period, and (ii) in the
event of casualty or condemnation under Articles XII and XIII
above which does not result in the termination of this Lease, the
insurance proceeds and condemnation award, as the case may be,
shall be made available for the repair or restoration of the
Leased Premises pursuant to the terms of this Lease. In the
event that the Leased Premises or any portion thereof is subject
to one or more mortgages at the time of execution of this Lease,
Landlord shall, within forty-five (45) days after the execution
of this Lease, furnish to Tenant a non-disturbance agreement from
the holder(s) of such mortgage(s) containing the agreements in
the immediately preceding sentence. In the event Landlord fails
to deliver to Tenant such non-disturbance within such time, or
within thirty (30) days of notice by Tenant of such failure,
Tenant shall have the right, at its option, to terminate this
Lease and in such event Tenant shall have no liability to
Landlord whatsoever.
XXI. SHORT FORM LEASE
The parties will at any time, at the request of either
one, promptly execute duplicate originals of an instrument in
recordable form, which will constitute a short form of lease,
setting forth a description of the Leased Premises, the term of
this Lease and any other portions thereof, excepting the rental
provisions, as either party may request.
XXII. MISCELLANEOUS
1. This Lease and the exhibits, if any, attached
hereto and forming a part hereof, set forth all the covenants,
promises, agreements, conditions, and understandings between
Landlord and Tenant concerning the Leased Premises and there are
no others, either oral or written, between them except as herein
set forth. No alteration, amendment, change or addition to this
Lease shall be binding upon Landlord or Tenant unless reduced to
writing and signed by each party.
2. The captions and article numbers appearing in
this Lease are inserted only as a matter of convenience and in no
way define, limit, construe or describe the scope or intent of
such sections or articles of this Lease nor in any way affect
this Lease.
3. Whenever herein the singular number is used, the
same shall include the plural, and the masculine gender shall
include the feminine and neuter genders, and vice versa, as the
context shall require. The terms "Landlord" and "Tenant"
whenever used herein, shall mean only the owner at the time of
Landlord's or Tenant's interest herein, and upon any sale or
assignment of the interest of either Landlord or Tenant herein,
their respective successors in interest and/or assigns shall,
during the term of their ownership of their respective estates
herein, be deemed to be Landlord to Tenant, as the case may be.
4. This Lease may be executed in several
counterparts, each of which shall be an original, but all of
which shall constitute one and the same instrument.
5. This Lease shall be governed by, and construed
in accordance with, the laws of the State of Wisconsin. If any
provision of this Lease or the application thereof to any person
or circumstances shall, to any extent be invalid or
unenforceable, the remainder of this Lease shall not be affected
thereby and each provision of the Lease shall be valid and
enforceable to the fullest extent permitted by the law.
6. Any amount due from Tenant to Landlord hereunder
which is not paid within five (5) days after the date due shall
bear interest at the rate of two percent (2%) per annum in excess
of the then announced prime rate of interest charged by First
Wisconsin National Bank of Milwaukee from the date due until
paid, unless otherwise specifically provided herein, but the
payment of such interest shall not excuse or cure any default by
Tenant under this Lease.
7. The covenant to pay rent is hereby declared to
be an independent covenant on the part of Tenant to be kept and
performed.
8. No payment by Tenant or receipt by Landlord of a
lesser amount than the monthly rent herein stipulated shall be
deemed to be other than on account of the earliest stipulated
rent, nor shall any endorsement or statement on any check or any
letter accompanying any check or payment as rent be deemed an
accord and satisfaction, and Landlord shall accept such check or
payment without prejudice to Landlord's right to recover the
balance of such rent or pursue any other remedy in this Lease
provided.
9. In the event of any sale or other transfer of
the Leased Premises by Landlord, the named Landlord shall be
entirely relieved of all obligations hereunder from and after the
date of the transfer; provided, however, that the transferee
shall assume the same by written agreement and a copy of the same
is delivered to Tenant within ten (10) days thereafter.
10. If Landlord shall fail to perform any covenant
or condition of this Lease upon Landlord's part to be performed
and, as a consequence of any such default, Tenant shall recover a
money judgement against Landlord, such judgement shall be
satisfied only out of the proceeds of sale received upon
execution of such judgement and levied thereon against the right,
title and interest of Landlord in the Leased Premises and out of
rents or other income from such property receivable by Landlord,
and Landlord shall not be liable for any deficiency.
11. Tenant agrees to execute any modification of
this Lease which may be reasonably required by Landlord's lenders
as a condition to making a mortgage loan on the Leased Premises,
provided that no such modification shall alter the rent or term
provided herein nor materially reduce the economic value hereof
or benefits hereunder to Tenant. Tenant agrees to complete and
properly return any such lease modification that may be
reasonably required in connection with any such mortgage loan on
the Leased Premises within ten (10) days after receipt thereof.
12. Except as expressly otherwise provided, all of
the terms, covenants and conditions hereof shall be binding upon
and inure to the benefit of the heirs, personal representatives,
successors in interest and assigns of the parties hereto.
SIGNED AND SEALED as of the date first written above.
LANDLORD: CENTER CITY PLAZA
By: _/s/ A. William Huelsman_
A. William Huelsman,
Its Managing Partner
TENANT: INTELLIGRAPHICS, INC.
By: _/s/ William D. Nantell
William D. Nantell,
Its President
AMENDMENT TO LEASES
This Amendment to Leases is made as this 11th day of
August, 1995, by and between Center City Plaza, a Wisconsin
partnership, hereinafter referred to as "Landlord", and
Intelligraphics, Inc., a Wisconsin corporation, hereinafter
referred to as "Tenant."
Landlord and Tenant agree as follows:
Notwithstanding any contrary provisions in any existing
lease by and between Landlord and Tenant, the rental rate
for any extended term of any lease, which extended term
begins after April 30, 1999 shall be the going and
prevailing rent for property of like character which is in
existence at April 30, 1999. The parties shall agree on the
rental to be paid for any extended term by April 30, 1998.
Landlord: CENTER CITY PLAZA
_/s/ A. William Huelsman
A. William Huelsman
Its Managing Partner
Tenant: INTELLIGRAPHICS, INC.
/s/ William D. Nantell
William D. Nantell
Its President
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT is signed as of the 22nd day of
December, 1995, by and between ANALYTICAL SURVEYS, INC., a
Colorado corporation (hereinafter referred to as the "Employer"
or "ASI"), and WILLIAM NANTELL (hereinafter referred to as the
"Employee").
WITNESSETH THAT:
WHEREAS, Employee has been employed by Intelligraphics, Inc.
("Intelligraphics"); and that employment has now been terminated
by reason of ASI's acquisition of substantially all of the assets
of Intelligraphics; and
WHEREAS, ASI wants to hire the employee, and ASI and
Employee desire to state in writing the terms and conditions of
their agreements and understandings, and to continue the term of
Employee's employment hereunder;
NOW, THEREFORE, in consideration of the foregoing, of the
mutual promises herein contained, and of other good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties, intending legally to be bound, agree
as follows:
1. Term of Employment.
The term shall commence on December 22, 1995, and shall
continue through December 31, 1996, unless sooner terminated in
accordance with the provisions of Paragraph 6 or unless extended
by Employer under Paragraph 6.4.
2. Duties of Employee.
2.1 It is understood and agreed that Employee's principal
duties on behalf of Employer are and shall be as President of the
Intelligraphics Division of ASI, or such additional
responsibilities as assigned by the President of ASI. In
accepting employment by Employer, Employee shall undertake and
assume the responsibility of performing for and on behalf of
Employer whatever duties are reasonably necessary and required in
his position as President of the Intelligraphics Division of ASI.
Employer agrees that it will not relocate Employee from his place
of current employment in Waukesha, Wisconsin to any other place
of employment, without Employee's prior consent which Employee
agrees to consider in good faith. Employer agrees that it will
not change Employee's title as President of the Intelligraphics
Division of ASI.<PAGE>
2.2 Employee covenants and agrees that at all times during
the term of this Agreement, Employee shall devote his full-time
efforts to his duties as an employee of the Employer.
3. Compensation.
3.1 Salary. As compensation for the services to be
rendered by Employee for Employer under this Agreement, Employee
shall be paid not less than the following base annual salary, on
the same basis (biweekly) as ASI's payroll, during the term
hereof: $130,000.00, plus annual increases and bonuses, if any,
as directed by the President of ASI.
3.2 Bonus. Employee shall be a participant in the
Intelligraphics Division of ASI Incentive Bonus Plan effective
through September 30, 1996 (and, if the option is exercised under
Paragraph 6.4, through September 30, 1997) ("Bonus Plan"). The
Bonus Plan is attached hereto as Exhibit A.
3.3 Salary Review. Employee's salary will be reviewed
annually for appropriate increases, if any, in January,
commencing January, 1997.
4. Additional Benefits.
In addition to, and not in limitation of, the compensation
referred to in Paragraph 3, Employee shall be paid the following
additional benefits during the term hereof:
4.1 Reimbursement. Reimbursement of all reasonable
expenses incurred by him in connection with performance of his
duties upon submission of vouchers. Reasonable expenses shall
include, but not be limited to all reasonable out-of-pocket
expenses for entertainment, automobile expenses, travel, meals,
lodging, professional fees, professional dues and the like
incurred by him in the interest of the Employer, subject to such
guidelines and policies as may be promulgated by Employer for
senior executives.
4.2 Vacations. Employee shall be entitled to vacations of
not less than four (4) weeks per year, in accordance with the
Employer's regular vacation policies established for senior
executives; provided, that Employee may accrue any unused
vacation time from year to year, and upon termination of
employment will be compensated for any unused vacation time.
4.3 Death or Disability Payments. In the event of the
Employee's disability or death prior to December 31, 1996 (or
prior to December 31, 1997, if the option is exercised under
Paragraph 6.4), Employee's salary in effect at the time of his
death or disability shall continue to be paid to the Employee, or
to his designee, for a period of six (6) calendar months from the
date of death or from the date of Employee's termination by
reason of disability. For the purposes of this Employment<PAGE>
Agreement, the obligations of the Employer to make the payments
upon the disability of Employee shall not become effective unless
and until all of the following conditions are met, as determined
by an independent physician selected by the President of ASI and
agreed to by Employee: (1) Employee shall become physically or
mentally incapable (excluding infrequent and temporary absences
due to ordinary illnesses) of properly performing the services
required of him in accordance with his obligations under
paragraph 2 hereof or similar provisions of any renewal
Agreement; (2) such incapacities shall exist or be reasonably
expected to exist for more than ninety (90) days in the aggregate
during the period of twelve (12) consecutive months; and (3)
either Employee or Employer shall have given the other party
thirty (30) days' written notice of his or its intention to
terminate the active employment of Employee because of such
disability.
4.4 Life Insurance. Employee shall be provided with a term
life insurance policy in the amount of $150,000 (provided he can
meet the medical conditions for such coverage without being
"rated"), payable to such beneficiaries as he shall designate,
with an additional $150,000 of accidental death coverage.
4.5 Comparable Benefits. Employee shall also be provided
with additional comparable benefits, if any, to those Employee
was receiving from Intelligraphics at the time of his termination
of employment with Intelligraphics.
5. Disclosure of Information.
Employee acknowledges that in and as a result of his employ-
ment hereunder, he will be making use of, acquiring, and/or
adding to confidential information of a special and unique nature
and value relating to such matters as Employer's trade secrets,
systems, procedures, manuals, confidential reports, and lists of
clients. As a material inducement to Employer to enter into this
Agreement and to pay to Employee the compensation stated in
Paragraph 3, as well as any additional benefits stated in
Paragraph 4, Employee covenants and agrees that he shall not,
other than in the ordinary course of business conducted for ASI,
at any time during or following the term of his employment,
directly or indirectly divulge or disclose for any purpose
whatsoever or appropriate to his own use or to the use of others
any confidential information that has been obtained by, or
disclosed to him, as a result of his employment by Employer.
6. Termination.
6.1 Termination By Employer.
(A) If Employer terminates Employee's employment
without cause prior to December 31, 1996, Employer will continue
to pay compensation and benefits to Employee (as if Employee
still were employed), and Employee shall be subject to the non-<PAGE>
compete provisions (the "Non-Compete") described in paragraph 7,
for the period beginning on the date of termination and ending
seven months thereafter.
(B) If Employer exercises the option described in paragraph
6.4 and then terminates Employee's employment without cause prior
to December 31, 1997, Employer will continue to pay compensation
and benefits to Employee (as if Employee still were employed),
and the Non-Compete shall apply, each for a period beginning on
the date of termination and ending seven months thereafter.
(C) If Employer terminates Employee's employment with
cause, at any time, the Non-Compete will apply for a period
beginning on the date of termination and ending 12 months
thereafter.
6.2 Termination by Employee.
(A) If Employee terminates his employment without cause
prior to December 31, 1996 or, if Employer exercises the option
in paragraph 6.4 and Employee terminates his employment without
cause prior to December 31, 1997, then the Non-Compete will apply
for a period beginning on the date of termination and ending 12
months thereafter.
(B) If Employee terminates his employment with cause prior
to December 31, 1996, or, if Employer exercises its option in
paragraph 6.4 and Employee terminates employment with cause prior
to December 31, 1997, Employer will pay compensation and benefits
to Employee (as if Employee still were employed), and the Non-
Compete will apply, each for a period beginning on the date of
termination and ending seven months thereafter.
6.3 Non-Renewal and Termination by Employee Without Cause.
If Employer does not exercise its option in paragraph 6.4 or if
Employer exercises its option in paragraph 6.4 but Employer and
Employee do not enter a new agreement prior to January 1, 1998,
and in either event Employee thereafter terminates employment
without cause, then Employer, at its option (to be exercised
within ten business days after such termination specifying the
period during which the payments and Non-Compete shall apply),
may pay Employee 75% of the compensation and 75% of the cost of
benefits that Employee would have received under the terms of
this Agreement in effect as of December 31, 1996 or December 31,
1997, as the case may be if Employee had remained employed, and
the Non-Compete will apply to Employee for any period in which
such payments are made, but such period may not extend beyond
twelve months from the date of termination without the mutual
written agreement of the parties.
6.4 Option to Extend. At Employer's option, and upon
payment to Employee of an additional $10,000, on or before
January 1, 1997, Employee agrees that the term of this Agreement
will be extended through December 31, 1997 and that he will not<PAGE>
voluntarily terminate his employment at any time prior to
December 31, 1997. If the option is exercised, and if Employee
has not terminated employment without cause and has not been
terminated by Employer with cause prior January 1, 1998, Employer
will pay to Employee an additional $10,000.
6.5 Except as provided in paragraphs 6.1(c) and 6.2(a), the
provisions set forth above regarding compensation and
applicability of the Non-Compete are the exclusive remedy for
damages for a termination of employment (but not for any other
breach), except that Employer shall be entitled to equitable
relief for any breach of the Non-Compete.
6.6 "For Cause" Definition. For purposes hereof, the term
"for cause," in the case of a breach by Employee, shall mean the
failure of Employee for any reason, within thirty (30) days after
receipt by Employee of written notice thereof from Employer, to
correct, cease, or otherwise alter any action or omission to act
that constitutes a material and willful breach of this Agreement
likely to result in material damage to ASI, or willful gross
misconduct likely to result in material damage to ASI (including
but not limited to any such willful activities or participation
in such willful activities, directly or indirectly, which are
materially adverse to the Employer or violate Employee's duty of
loyalty to the Employer); and, in the case of a breach by
Employer, shall mean a material default by Employer which remains
uncured 30 days after Employee gives Employer notice of such
breach or any reduction of duties of Employee such that Employee
ceases to have executive supervisory responsibilities.
6.7 Effective Date of Termination.
(A) The effective date of termination with respect to
termination "without cause," shall be the date on which Employee
actually ceases to perform his duties hereunder.
(B) The effective date of termination with respect to
termination "for cause," shall be thirty (30) calendar days after
the date on which Employee receives written notice of
termination.
6.8 Limitation on Severance Compensation. Notwithstanding
any other provision of this Agreement, the aggregate of the
amount of severance compensation paid to the Employee under this
Agreement or otherwise, shall not include any amount that the
Employer is prohibited from deducting for federal income tax
purposes by virtue of Section 280G of the Internal Revenue Code
or any successor provision.
7. Covenant Not To Compete.
During any applicable period specified in paragraph 6, the
Employee shall not directly or indirectly own, control, operate,
manage, consult, own shares in, be employed by, or otherwise<PAGE>
participate in any sole proprietorship, corporation, partnership
or other entity whose primary business is the same or similar to
the business of ASI within the territory in which ASI does
business.
This covenant of non-competition has been negotiated and
agreed to by and between the Employer and Employee with full
knowledge of, and pursuant to the requirements of Section 8-2-113
(2) of Colorado Revised Statutes, as amended from time to time,
and is deemed by both parties to be fair and reasonable under the
terms of that statute.
8. Other Business Activities.
During the period of his employment under this Agreement,
the Employee shall not be employed by or otherwise engage or be
interested in any business whether or not in competition with
ASI, with the following exceptions:
(A) Employee's investment in any business shall not be
considered a violation of this paragraph, provided that such
business is not in competition with ASI and so long as any
services rendered to such business by Employee do not in any way
interfere with Employee's duties under this Agreement.
(B) Employee may consult with other businesses not in
competition with ASI, if expressly considered and approved in
advance by the President of ASI (in his or her sole discretion).
9. Indemnification.
So long as Employee is not found by a court of law to be
guilty of a willful and material breach of this Agreement, or to
be guilty of willful gross misconduct, he shall be indemnified
from and against any and all losses, liability, claims and
expenses, damages, or causes of action, proceedings or
investigations, or threats thereof (including reasonable attorney
fees and expenses of counsel satisfactory to and approved by
Employee) incurred by Employee, arising out of, in connection
with, or based upon Employee's services and the performance of
his duties pursuant to this Employment Agreement, or any other
matter contemplated by this Employment Agreement, whether or not
resulting in any such liability subject to such limitations as
are provided by the Colorado Business Corporations Act; and
Employee shall be reimbursed by Employer as and when incurred for
any reasonable legal or other expenses incurred by Employee in
connection with investigating or defending against any such loss,
claim, damage, liability, action, proceeding, investigation or
threat thereof, or producing evidence, producing documents or
taking any other action in respect thereto (whether or not
Employee is a defendant in or target of such action, proceeding
or investigation), subject to such limitations as are provided by
the Colorado Business Corporations Act.<PAGE>
10. [Intentionally Omitted.]
11. Burden and Benefit.
This Agreement shall be binding upon, and shall inure to the
benefit of, Employer and Employee, and their respective heirs,
personal and legal representatives, successors, and assigns and
shall be expressly binding upon and inure to the benefit of any
person or entity acquiring ASI by merger, consolidation, purchase
of all or substantially of its assets or 80% or more of its
outstanding common stock; provided, however, that the interests
of the Employee hereunder are not subject to the claims of his
creditors, and may not be voluntarily or involuntarily assigned,
alienated or encumbered.
12. Release.
Employee, by signing this Agreement, hereby forever releases
ASI against any claims or liabilities whatsoever arising out of
his employment by Intelligraphics.
13. Governing Law.
It is understood and agreed that the construction and inter-
pretation of this Agreement shall at all times and in all
respects be governed by the laws of the State of Colorado.
14. Severability.
The provisions of this Agreement, including particularly but
not solely, the provisions of Paragraphs 5 and 7, shall be deemed
severable, and the invalidity or unenforceability of any one or
more of the provisions of this Agreement shall not affect the
validity and enforceability of the other provisions.
15. Notice.
Any notice required to be given shall be sufficient if it is
in writing and sent by certified or registered mail, return
receipt requested, first-class postage prepaid, to his residence
in the case of Employee, and to its principal office in the case
of Employer.
16. Entire Agreement.
This Agreement contains the entire Agreement and under-
standing by and between Employer and Employee with respect to the
employment of Employee, and no representations, promises, agree-
ments, or understandings, written or oral, not contained herein
shall be of any force or effect. No change or modification of
this Agreement shall be valid or binding unless it is in writing
and signed by the party intended to be bound. No waiver of any
provision of this Agreement shall be valid unless it is in
writing and signed by the party against whom the waiver is sought<PAGE>
to be enforced. No valid waiver of any provision of this
Agreement at any time shall be deemed a waiver of any other
provision of this Agreement at such time or at any other time.
17. Counterparts.
The Agreement may be executed in two or more counterparts,
any one of which shall be deemed the original without reference
to the others.
18. Dispute Resolution.
All disputes arising out of or related to this Agreement,
including any claims that all or any part of this Agreement is
invalid, illegal, voidable, or void, will be settled by
arbitration, pursuant to an Arbitration Agreement between ASI,
Intelligraphics, Inc., certain former employees of
Intelligraphics, Inc., Joanne Huelsman, James Carpenter, the
members of the board of directors of the Company who are voting
trustees under the Voting Trust Agreement and Bank One, Colorado,
NA dated December 22, 1995.
IN WITNESS WHEREOF, Employer and Employee have duly executed
this Agreement as of the day and year first above written.
EMPLOYEE: EMPLOYER:
ANALYTICAL SURVEYS, INC.,
a Colorado corporation
/s/ William Nantell By: /s/ Sidney V. Corder
WILLIAM NANTELL SIDNEY V. CORDER, President<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted
from SEC Form 10-QSB and is qualified in its entirety by reference
to such financial statements.
</LEGEND>
<CIK> 0000753048
<NAME> ANALYTICAL SURVEYS INC
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> DEC-31-1995
<CASH> 335173
<SECURITIES> 0
<RECEIVABLES> 10912281
<ALLOWANCES> 20000
<INVENTORY> 0
<CURRENT-ASSETS> 11497548
<PP&E> 7010524
<DEPRECIATION> 5257036
<TOTAL-ASSETS> 16404732
<CURRENT-LIABILITIES> 4973741
<BONDS> 0
<COMMON> 4233022
0
0
<OTHER-SE> 3593650
<TOTAL-LIABILITY-AND-EQUITY> 16404732
<SALES> 0
<TOTAL-REVENUES> 3648634
<CGS> 0
<TOTAL-COSTS> 3172688
<OTHER-EXPENSES> (43)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 28271
<INCOME-PRETAX> 447718
<INCOME-TAX> 172500
<INCOME-CONTINUING> 275218
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 275218
<EPS-PRIMARY> .09
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</TABLE>
