**Exhibit 10.1**

 

**SECOND AMENDMENT TO LEASEAGREEMENT**

 

**THIS SECOND AMENDMENT TO LEASE AGREEMENT** (“Amendment”) is made and entered into as ofthe 29th day of April, 2005, by and between **CSMPROPERTIES, INC.**, a Minnesota corporation (“Landlord”) and **PPT VISION, INC.**, a Minnesota corporation (“Tenant”).

 

**RECITALS**

 

A.                                   Landlord and Tenant entered into that certainLease dated July 17, 1998, as amended by that certain Addendum to Leasedated July 26, 1999, as further amended by that certain First Amendment ofLease dated October 28, 1999 (collectively, the “Lease”) pursuantto which Tenant leases from Landlord approximately 64,112 square feet of spacelocated in the Prairie Crossroads Corporate Center, as more particularlydescribed in the Lease (the “Premises”).

 

B.**                                    **The parties desire to amend the Lease inaccordance with the terms and conditions set forth below.

 

**AGREEMENT**

 

**NOW THEREFORE**,in consideration of the mutual promises herein contained and other good andvaluable consideration, the receipt and sufficiency of which are herebyacknowledged, the Lease is hereby supplemented, amended and modified asfollows:

 

1.                                       **Reduction of Premises****.**  As ofMay 1, 2005 (the “Reduction Date”), Tenant shall surrender to Landlordthat portion of the Premises consisting of approximately 28,977 rentable squarefeet which is depicted on the attached **Exhibit A**attached hereto (the “Surrender Space”). As of the Reduction Date (i) the Premises shall consist ofapproximately 35,135 rentable square feet as depicted on **Exhibit A-1**attached hereto, subject to final measurement, and (ii) Tenant’s Pro-RataShare of operating expenses shall be forty three and 45/100 percent(43.45%).  Tenant’s Base Rent for theremaining Premises shall reduced in accordance with Section 3of this Amendment.

 

2.                                       **Lease Term****.**  Theterm of the Lease shall be extended for an additional twenty four (24) monthperiod, commencing June 1, 2009 and expiring May 31, 2011.  Section 14.14 (Right to Terminate) ofthe Lease is hereby deleted.

 

3.                                       **Base Rent****.**  As ofApril 29, 2005, Tenant is in default on its payment of Base Rent andoperating expenses under the Lease in the amount of Two Hundred Ninety EightThousand Three Hundred One and No/100 Dollars ($298,301.00) (the “DelinquentRent”).  Tenant shall pay the DelinquentRent to Landlord concurrently with the execution of this Amendment.  Tenant shall also pay a lease reductionpenalty (“Penalty”) in the amount of Two Hundred Forty Thousand and No/100Dollars ($240,000.00) in twelve (12) equal monthly installments of Twenty Thousandand No/100 Dollars ($20,000.00) on or prior to the first day of each monthcommencing May 1, 2005 through April 1, 2006, in addition to Tenant’sexisting rent obligations.  Landlord hasalso agreed to reduce Tenant’s Base Rent for the remaining Premises to Eightand 10/100 Dollars ($8.10) per rentable square foot for the period commencing May 1,2005 through May 31, 2009, and Eight and 91/100 Dollars ($8.91) perrentable square foot for

 

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the period commencing June 1, 2009 through May 31,2011.  Tenant’s revised Base Rentobligations (including the Penalty) are summarized as follows:

 
| **Months**                 | ** ** | **Monthly Base Rent** | ** ** | **Per Rentable Sq. Ft.** | ** ** |
|----------------------------|------------|-----------------------|------------|--------------------------|------------|
| 5/1/2005  – 4/30/2006 |       | $                     | 43,716.13  |                     | $          | 14.93 |   |
| 5/1/2006  – 5/31/2009 |       | $                     | 23,716.13  |                     | $          | 8.10 |   |
| 6/1/2009  – 5/31/2011 |       | $                     | 26,087.74  |                     | $          | 8.91 |   |

 

Notwithstandingthe foregoing, if Tenant fails to pay Base Rent and the installments of thePenalty on time during the period commencing May 1, 2005 through April 30,2006 (with time being of the essence) then Landlord shall have the right to (i) withdrawthe foregoing alternative rent schedule and to require Tenant toimmediately pay all delinquent amounts under the original terms of the Lease,and (ii) exercise any and all other remedies available to Landlord underthe Lease, at law or in equity.

 

4.                                       **Surrender****.**  Onthe Reduction Date, Tenant shall surrender possession of the Surrender Space inthe condition required by Section 5.3 of the Lease, the same as if theLease were being terminated.  As of theReduction Date, Tenant shall and hereby does transfer, convey, quitclaim andassign to Landlord all of its rights and interests in and to the SurrenderSpace; provided the foregoing does not in any way relieve Tenant from itsobligations under Section 5.3 with respect to the Surrender Space orTenant’s obligation to pay Base Rent and its Pro-Rata Share of operatingexpenses on the remaining Premises.

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5.                                       **Failure to Surrender****.** Notwithstanding anything to the contrary contained herein or in theLease, Tenant shall have no right to extend the term of the Lease with regardto the Surrender Space beyond the Reduction Date.  If Tenant fails to surrender possession ofthe Surrender Space to Landlord in the condition required by this Amendment by12:00 noon on the Reduction Date, then Landlord or its authorized agent, inaddition to any and all remedies it may have under the Lease, this Amendment,at law or in equity, shall have the right to immediately recover from Tenant (i) possessionof the Surrender Space, and Tenant agrees not to contest any court action orproceedings brought by Landlord or its agent to recover possession of theSurrender Space from Tenant, and (ii) damages that may be asserted againstLandlord or that Landlord may incur from such holding over by Tenant.  Tenant further specifically agrees toindemnify, hold harmless and defend Landlord from and against any and allliability, loss, cost, damages, claims, actions, or causes of action (includingcourt costs, witness fees, and reasonable attorneys’ fees) asserted against orincurred by Landlord by reason of Tenant’s failure to timely surrenderpossession of the Premises in accordance with the terms of this Amendment.

 

Withoutlimiting the foregoing, and in addition to any other rights or remedies ofLandlord under the Lease, this Amendment, at law or in equity, if Tenant doesnot return possession of the Surrender Space to Landlord in the physicalcondition required by this Amendment, then (i) any of Tenant’s personalproperty, furniture, fixtures, equipment or belongings that are not removed onor before the Reduction Date shall be deemed abandoned, and Tenant agrees thatLandlord shall have no duty of care with respect to such property and thatLandlord or its authorized agent may remove and dispose of such property as itdeems prudent and any cost in regard thereto shall be payable by Tenant toLandlord as additional rent, (ii) Landlord may repair and restore theSurrender Space to the condition required by the terms of this Amendment andrecover the costs of doing 

 

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sofrom Tenant and (iii) Tenant agrees to indemnify, hold harmless and defendLandlord from and against any and all liability, loss, cost, damages, claims,actions, or causes of action (including court costs, witness fees andreasonable attorneys’ fees) incurred by or asserted against Landlord by reasonof Tenant’s failure to return possession of the Surrender Space in the physicalcondition required by this Amendment.

 

6.                                       **Landlord’s Work****.**  Landlord,at its sole cost and expense (except as provided below), will complete theconstruction of the interior improvements to the Premises described in thefloor plan and specifications attached hereto as **EXHIBIT B**(collectively, “Landlord’s Work”). Any changes or modifications to Landlord’s Work shall be made andaccepted by written change orders or agreement signed by Landlord and Tenantand shall constitute an amendment to this Lease.  Tenant shall reimburse Landlord, withinfifteen (15) days after written request, for the cost of any change orders thatincrease the total cost of Landlord’s Work. Notwithstanding anything to the contrary, Tenant shall pay One Hundred and Forty Thousand and No/100 Dollars($140,000.00) (the “Tenant Improvement Funds”) to Landlord for the cost of theLandlord’s Work concurrently with the execution of this Amendment.

 

7.                                       **Final Measurement****.**  Assoon as reasonably possible after the Reduction Date, Landlord will provideTenant with a calculation of the rentable area of the Premises as determined byLandlord.  Thereafter, Landlord andTenant shall execute an addendum to the Lease substantially in the formattached hereto as **Exhibit C**,confirming said determination and adjusting, to the extent applicable, (i) thearea of the Premises, (ii) the Base Rent, and (iii) Tenant’s Pro-RataShare of operating expenses to reflect the actual rentable square foot area ofthe Premises.  Until such time as saidas-built measurements are available, Tenant agrees that the estimated squarefeet of rentable area of the Premises set forth in Section 1 above shallbe utilized to compute Base Rent, Tenant’s Pro-Rata Share of Operating Expensesand any other sums due hereunder based in whole or in part on the squarefootage of the Premises and Landlord shall reconcile such amounts paid if theactual rentable square footage is different than that set forth in Section 1hereof.

 

8.                                       **Utilities****.**  Anyutilities that cannot be separately metered to the remaining Premises shall bepaid by Landlord and included within the definition of operating expenses ofwhich Tenant shall reimburse Landlord it Pro-Rata Share thereof.

 

9.                                       **Brokerage****.**  Eachof the parties represent and warrant that there are no claims for brokeragecommissions or finder’s fees in connection with this Amendment, and agrees toindemnify the other against, and hold it harmless from all liabilities arisingfrom any such claim, including without limitation, the costs of attorney’s feesin connection therewith.

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10.                                 **Miscellaneous.**  Except as otherwiseprovided herein, all capitalized terms used herein shall have the meaningascribed to them in the Lease.  Except as specifically modified herein, all of the covenants,conditions, and obligations under the Lease shall remain unchanged and in fullforce and effect. In the event of a conflict between the terms of theLease and this Amendment, the terms of this Amendment shall prevail. ThisAmendment shall be binding upon the parties hereto and their respectivesuccessors and assigns.  This Amendmentmay be executed in one or more counterparts each of which when so executed anddelivered shall constitute an original, but together said counterparts shallconstitute one and the same instrument. Execution 

 

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copiesof this Amendment may be delivered by facsimile, and the parties hereto agreeto accept and be bound by facsimile signatures hereto.  The signature of any party on a facsimiledocument, for purposes hereof, is to be considered to have the same bindingeffect as an original signature on an original document.  At the request of either party, any facsimiledocument is to be re-executed in original form by the party who executed theoriginal facsimile document.  Neitherparty may raise the use of a facsimile machine or the fact that any signaturewas transmitted through the use of a facsimile machine as a defense to theenforcement of this Amendment. Notwithstanding anything to the contrary contained herein, if Tenantdoes not pay to Landlord the Delinquent Rent and the Tenant Improvement Fundswithin five (5) business days of the execution of this Amendment, thenLandlord may terminate this Amendment by delivering written notice to Tenant.

 

**INWITNESS WHEREOF**, the parties have executed this Amendment asof the day and year first above written.

 
| **LANDLORD:**            | **TENANT:**          |
|--------------------------|----------------------|
|                     |                 |
| **CSM PROPERTIES, INC.** | **PPT VISION, INC.** |
|                     |                 |
| By:                      |                 |   | By: |   |   |
|                     |                 |
| Print Name:              |                 |   | Print Name: |   |   |
|                     |                 |
| Print Title:             |                 |   | Print Title: |   |   |
|                          |                      |  |  |  |  |  |  |  |  |  |  |

 

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**EXHIBIT A**

 

**SURRENDER SPACE**

 

 

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**EXHIBIT A-1**

 

**PREMISES**

 

 

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**EXHIBIT B**

 

**LANDLORD’S WORK**

 

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**EXHIBIT C**

 

**ADDENDUM TO SECOND AMENDMENT TO LEASE**

 

**THIS ADDENDUM TO SECOND AMENDMENT TO LEASE** (“**Addendum**”) isentered into this        day of                     ,2005 between **CSM PROPERTIES, INC.**, a Minnesotacorporation (“**Landlord**”) and **PPT VISION, INC.**, a Minnesota corporation (“**Tenant**”) and modifies that certain Second Amendment to Leasedated April 29, 2005 (the “**Amendment**”).

 

TheAmendment is amended as follows:

 

1.                                       **Premises****.** Landlord and Tenant acknowledge and confirm that according to the “as-built”measurements the Premises consists of                       rentable square feet.

 

2.                                       **Base Rent****.**

 
| **Months**                 | ** ** | **Monthly Base Rent** | ** ** | **Per Rentable Sq. Ft.** | ** ** |
|----------------------------|------------|-----------------------|------------|--------------------------|------------|
| 5/1/2005  – 4/30/2006 |       | $                     |       | $                        | 14.93      |   |
| 5/1/2006  – 5/31/2009 |       | $                     |       | $                        | 8.10       |   |
| 6/1/2009  – 5/31/2011 |       | $                     |       | $                        | 8.91       |   |

 

3.                                       **Pro-Rata Share****.** Landlord and Tenant acknowledge and confirm that Tenant’s Pro-Rata Shareof operating expenses shall be        percent (      %).

 

4.                                       **Miscellaneous****.**  Ifany provision of the Amendment is inconsistent with the provisions containedherein, then and in such event, the provisions of this Addendum shallcontrol.  Except as expressly modifiedherein, all other terms and conditions of the Amendment shall remain unchanged,and in full force and effect.

 
| **LANDLORD:**            | **TENANT:**          |
|--------------------------|----------------------|
|                     |                 |
| **CSM PROPERTIES, INC.** | **PPT VISION, INC.** |
|                     |                 |
| By:                      |                 |   | By: |   |   |
|                     |                 |
| Print Name:              |                 |   | Print Name: |   |   |
|                     |                 |
| Print Title:             |                 |   | Print Title: |   |   |
|                          |                      |  |  |  |  |  |  |  |  |  |  |

 

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