**Exhibit10.59**

 

**LEASEAGREEMENT**

 

**THIS LEASE AGREEMENT** (the “Lease”), is made and entered into this1st day of February, 2008, by and between **J.J.C.VALLEY PROPERTIES, LLC**, (the “Lessor”), and **ISI CONTROLS,LTD.**(the “Lessee”).

 

**WITNESSETH:**

 

**IN CONSIDERATION** of the rents and agreements of Lesseeherein, Lessor hereby leases to Lessee the following-described premisessituated at 3030 East Goodland Drive, City of Appleton, Outagamie County,Wisconsin (hereinafter referred to as the “Premises”), on and subject to theterms, conditions and provisions herein contained.

 

**1.             Term**.  To have and to hold thePremises to Lessee for a term of five (5) years, commencing on February 1,2008 (the “Commencement Date”) and ending at midnight on January 31, 2013(the “Initial Term”).

 

**2.             Option to Extend Lease Term**.  Providedthat Lessee is not in default with respect to any term or condition of thisLease*,*Lessee shall have theoption to extend the Lease for two (2) additional five (5)-year terms,provided notice in writing shall be given to Lessor at least one hundred eighty(180) days prior to the end of the initial term of the Lease or any extendedterm thereof.  The rental for theextension period shall be as provided below.

 

**3.             Rent**.  Lessee agrees to pay toLessor, as rent during the Initial Term of this Lease and the first renewalterm, the sum of Fourteen Thousand Dollars ($14,000.00) per month (“Base Rent”),commencing on the Commencement Date and on the 1st day of each calendar monththereafter.  Notwithstanding anythingcontained in the preceding sentence, unless and until Lessee defaults beyondany applicable notice and cure periods, with respect to any covenant orobligation set forth in this Lease or in the Business Note (the “Note”),executed on even date herewith by and between Lessee and Lessor, Lessee’sobligation to pay rent from the Commencement Date up through and including January 31,2010, shall abate (the “Rental Abatement Period”).

 

In the event that Lesseedefaults, with respect to any covenant or obligation set forth in this Lease orin the Note during the Rental Abatement Period, which such default is not curedwithin fourteen (14) days of Lessor’s written notice to Lessee (the “NoticePeriod”), then this Lease shall terminate on the last day of the Notice Periodand all Base Rent that would have been due to Lessor from Lessee during theRental Abatement Period shall be immediately due and payable.

 

In the event that Lesseedefaults with respect to any covenant or obligation set forth in the Noteduring the Rental Abatement Period and such default is cured during the NoticePeriod, then this Lease will not terminate, but the rental abatement shall berevoked retroactive to the Commencement Date. Thereafter, Lessee’s Base Rent shall be increased to an amount equal tothe total of Lessee’s Base Rent that would have been due during the RentalAbatement Period but for the abatement of such Base Rent, plus the total of allBase Rent due throughout the balance of the Initial Term of this Lease dividedby the number of months remaining in the Initial Term of this Lease.  Said increased Base Rent shall be due andpayable on the first day of the first month immediately after the end of theNotice Period, during which Lessee’s default was cured, and, thereafter, on thefirst day of each month thereafter throughout the balance of the Initial Term.  During the first renewal term, however,Lessee’s Base Rent shall be reduced to Fourteen Thousand Dollars ($14,000.00)per month payable on the first day of the first month of the first renewal termand on the same day of each successive month thereafter.

 

1

----

 

In the event that Lesseeshall exercise Lessee’s option to renew this Lease for a second renewal term,then Lessee’s monthly rental obligation, throughout the entire second renewalterm, shall be equal to ninety-five percent (95%) of the prevailing market ratefor commercial premises of like kind construction, design, use, and location(the “Prevailing Market Rate”).  For purposesof this Lease, the Prevailing Market Rate shall be determined, as of the firstday of the second renewal term, by the written mutual agreement of Lessor andLessee.  In the event that Lessee andLessor have not mutually agreed as to the Prevailing Market Rate by a date thatis forty-five (45) days prior to the first day of the second renewal term, thenLessor shall, at Lessor’s expense, obtain an independent written determinationof the Prevailing Market Rate from a qualified commercial real estate brokerfamiliar with the Premises and commercial real estate, in general, in OutagamieCounty, Wisconsin.  Lessee shall also, atLessee’s expense, obtain an independent written determination of the PrevailingMarket Rate from a qualified commercial real estate broker familiar with thePremises and commercial real estate, in general, in Outagamie County, Wisconsin.  If the two (2) opinions are within tenpercent (10%) of each other, determined according to ten percent (10%) of the higherof the two (2) opinions, then the Prevailing Market Rate shall be equal tothe average of the two (2) opinions. If the two (2) opinions are not within ten percent (10%) of eachother, determined according to ten percent (10%) of the higher of the two (2) opinions,and Lessor and Lessee are still unable to agree as to the Prevailing MarketRate, then the two (2) commercial real estate brokers shall appoint athird qualified commercial real estate broker familiar with the Premises andcommercial real estate, in general, in Outagamie County, Wisconsin, the expenseof which shall be divided equally between Lessor and Lessee, and the opinion ofthe third commercial real estate broker shall be the Prevailing Market Rate.

 

Notwithstanding anythingcontained in this Section 3 to the contrary, for any month during thesecond renewal term during which Lessee’s Base Rent is in dispute and subjectto the dispute resolution process set forth above, Lessee’s monthly rentalobligation shall be Fourteen Thousand Dollars ($14,000.00) subject toadjustment, upward or downward, upon the determination of Lessee’s Base Rentdue and owing throughout the second renewal term.  Any such adjustment shall be made to the firstand, if necessary, second Base Rent payments due immediately after the finalsecond renewal term Base Rent determination.

 

**4.             Charge for Late Rent**.  Anyrent not timely paid by or on the fourteenth (14th) day of any calendar monthshall accrue a late charge of one and one-half percent (1-1/2%) for each month,or portion thereof, that such rent remains unpaid.

 

**5.             Security Deposit**.  Uponthe execution of this Lease, Lessee shall pay a security deposit of FourteenThousand Dollars ($14,000.00) to be held by Lessor to secure Lessee’sperformance of Lessee’s obligations and protect Lessor’s rights under thisLease, which sum shall be refunded to Tenant within ten (10) days of theexpiration of this Lease.

 

**6.             Use and Care of Premises**.  ThePremises may be used for any lawful purpose and shall be kept in a clean andsafe condition in accordance with local ordinances and lawful direction ofproper authorities.

 

**7.             Structural Alterations or Additions**.  Nostructural alterations or additions shall be made by Lessee during the term ofthis Lease, in or to the Premises, without the prior written consent of Lessor,which consent shall not be unreasonably withheld.  Any alterations or additions to be made shallcomply with appropriate building code and zoning ordinances.  All additions or alterations as made shall,at the option of Lessor, become part of the Premises and property of Lessor or,upon termination of the Lease, Lessor may demand that Lessee remove the sameand restore the Premises to a substantially similar condition they were inprior to Lessee’s occupancy, reasonable wear and tear, and damage caused bycasualty, excepted.  However,

 

2

----

 

once Lessor agrees that an alteration shallbecome part f the Premises and the property of Lessor, Lessee shall have noobligation to remove said alteration.

 

**8.             Utilities and Services**. Lessee shall pay all utility and service charges, including but notlimited to, gas, water, heat, air-conditioning or electricity charges, used inthe Premises, as the same shall become due.

 

**9.             Taxes**.  Lessee shall, during the termof this Lease, pay all real estate taxes levied in respect of the Premises, orany part thereof, whether assessed against Lessor or against Lessee.  Lessee shall pay to Lessor, as additionalrent, an amount equal to one-twelfth (1/12th) of the real estate taxes leviedin respect of the Premises.  Said amountshall be calculated on the basis of the prior year’s real estate taxes andshall be payable, in advance, with each of Lessee’s monthly rental payments.

 

If the total of Lessee’s additional rent payments,relative to real estate taxes with respect to any tax year, is less than theactual amount of the Premises’ real estate taxes, then Lessee shall pay, withinthirty (30) days of Lessee’s receipt of Lessor’s written demand, the differencebetween the total of Lessee’s additional rent payments, for the applicableyear, and the actual real estate taxes due and owing with respect to thePremises.

 

If the total of Lessee’s additional rentpayments, relative to real estate taxes with respect to any tax year, exceedsthe actual amount of the Premises’ real estate taxes, then the excess shall becredited against Lessee’s obligation to pay real estate taxes for the Premisesfor the following year, or in the event this Lease has terminated, Lessor shallpromptly refund such overpayment amount to Tenant.

 

In the event any special assessments,including specifically, but not exclusively, curb, gutter, paving, etc., arelevied against the Premises and are not caused specifically by the actions ofLessee, then Lessor shall be responsible for the payment of said specialassessments in full when levied or, if an alternative installment payment isavailable, at Lessor’s option, Lessor shall pay said special assessments overthe installment periods.

 

The foregoing notwithstanding, to the extentthat any structural alterations or additions are made to the Premises whichincrease the value of the Premises for purposes of real estate taxes or resultin a special assessment being levied against the Premises, Lessee shall be responsiblefor the payment of said increase in said real estate taxes and/or said specialassessment.

 

**10.          Repairs and Maintenance**. Lessee shall keep and maintain the Premises in good condition and repair(except for reasonable wear and tear and damage by casualty), including, butnot limited to, the heating, electrical, plumbing and air-conditioning systemsexclusively serving the Premises, and shall replace all broken and crackedglass.  Except as set forth below, Lesseeshall also be responsible for repairing any damage caused to the Premises,whether directly or indirectly, during Lessee’s occupancy of the Premises.

 

Lessor has delivered the building in goodrepair and condition to Lessee, but agrees that Lessor shall be obligated tomaintain such structural portions of the building (i.e., walls, roof andfoundations) during the term hereof, provided that said repair is not due tothe actions of Lessee in which event Lessee shall be responsible for suchrepair and maintenance.

 

If Lessee refuses or neglects to commence orcomplete repairs promptly and adequately, Lessor may, but shall not be requiredto do so, make or complete said repairs and Lessee shall pay the reasonablethird-party costs thereof to Lessor within ten (10) days written demandtherefore..  Lessee shall comply with thedirections of proper public officers as to the maintenance of the Premises andshall comply with all health and police regulations applicable to or affectingthe Premises.

 

3

----

 

Lessee shall undertake appropriate measuresto maintain the Premises in a sanitary condition and free from rodents and/orpests.

 

Lessee shall be responsible for snow removaland lawn and landscape maintenance at the Premises.

 

**11.****                              ****Insurance**.

 

**A.            Fire and Extended Coverage**.  Lesseeshall carry fire and extended coverage insurance on the Premises during theentire term of this Lease in an amount equal to the full insurable value of thebuildings and all additions or improvements made thereon by either party,written by a reliable insurance company or companies authorized to do businessin the State of Wisconsin.

 

**B.            Liability**. Lessee shall keep in force for the benefit of Lessor and Lesseecomprehensive general liability insurance with minimum limits of liability inrespect to bodily injury of One Million Dollars ($1,000,000.00) for each personand Two Million Dollars ($2,000,000.00) for each occurrence and, with respectto property damage, the sum of Five Hundred Thousand Dollars ($500,000.00) foreach occurrence.

 

**C.            Contents**. Lessee shall keep in force for Lessee’s benefit a policy of insurance inbroad endorsement form to protect damage to the contents on the Premises.

 

**D.            Waiver of Subrogation**.  Eachparty mutually releases and discharges the other, and its employees, from allclaims and liabilities arising from or caused by any hazard covered byinsurance on the Premises or covered by insurance in connection with propertyon or activities conducted on the Premises, regardless of the cause of thedamage or loss.

 

This release is conditionedupon the inclusion in the policy or policies of a provision whereby any suchrelease shall not adversely affect said policies or prejudice any right of theparty releasing the other to recover through said policy.  Each party agrees that such party’s insurancepolicy shall include such a provision so long as the same shall be obtainablewithout extra cost.

 

**E.             Certificates of Insurance**.  AllCertificates of Insurance shall be deposited with Lessor.  The policy or policies shall name Lessor andLessee as insureds and shall bear endorsements to the effect that the insureragrees to notify Lessor not less than thirty (30) days in advance of anymodification or cancellation thereof.

 

Lessee agrees that no act or thing shall bedone on the Premises which may void, or make voidable, any insurance on thePremises, or any part thereof.

 

**12.          Damage by Fire or Other Casualty**. Damage not in excess of thirty-three and one-third percent (33-1/3%) ofthe Premises by fire or any other cause shall not terminate this Lease, butshall entitle Lessee to a pro rata abatement or reduction in rent payable toLessor.  Lessor shall proceed with duediligence to collect the proceeds of any available insurance, and rebuild orrestore the Premises to at least as good a condition as existed immediatelyprior to the casualty.

 

In the event of damage in excess ofthirty-three and one-third percent (33-1/3%) of the Premises or its totaldestruction, Lessee shall have the option to terminate this Lease and surrenderthe Premises, or to a pro rata abatement or reduction of the rent payable toLessor.

 

4

----

 

In the event Lessor and Lessee mutually agreethat it would be in their best interest to rebuild or restore the Premises,then Lessor shall proceed with due diligence to collect the proceeds of anyavailable insurance and rebuild or restore the Premises to at least as good acondition as existed immediately prior to the casualty.

 

**13.          Lessor’s Right of Entry**. Lessor may enter into and on the Premises, including any building orstructure thereon, during Lessee’s normal business hours, and on twenty-four(24) hours prior notice, for the purpose of examining or inspecting theconditions thereof in order to exercise any right or power reserved to Lessorunder the terms and provisions of this Lease.

 

**14.          “For Rent” or “For Sale” Signs of Lessor**. Lessor may, within one hundred eighty (180) days prior to the expirationof any Lease term, if there has been no extension or renewal, place signs onthe walls, doors or windows of the building on the Premises, advertising thatthe Premises are for rent or for sale, which signs shall remain thereon withouthindrance or molestation by Lessee.

 

**15.          Restrictions Against Liens**. Lessee shall pay and settle all expenses and liabilities arising out ofor in any way connected with any and all construction, repairs, alterations ormaintenance authorized by Lessee and approved by Lessor of any and allbuildings on the Premises, and Lessee shall keep the Premises and thestructures thereon free and clear from all liens of mechanics or materialmen,and all liens of a similar character, arising out of or growing out of theconstruction, repair, alteration or maintenance of such structures.

 

**16.          Indemnity**.  Lessee assumes all risks andresponsibilities for accidents, injuries, or death resulting from injuries ordamages to person or property occurring in, on, or about the Premises.  Subject to the waiver of subrogation setforth in Section 11D hereof, Lessee agrees to indemnify and hold Lessor,and Lessor’s members, officers, directors, employees, agents, and assigns fromany and all claims, liabilities, losses, costs, and expenses (includingreasonable attorneys’ fees) arising from or in connection with, the condition,use, or control of the Premises, including the improvements thereon, during theterm of this Lease and any renewal term. Subject to the waiver of subrogation set forth in Section 11Dhereof, Lessee shall be liable to Lessor for any damages to the Premises,including the improvements thereon, and for any act done by Lessee or anyemployee or agent of Lessee, or any invitee or licensee of Lessee.

 

**17.          Waste**.  Lessee shall not suffer orpermit any waste, or overloading, damaging or defacing of the Premises, or anyuses thereof which shall be unlawful, improper or contrary to any law of theState of Wisconsin, or ordinance of the municipality, or rule orregulation of any public authority at the time being in force, or injurious toany person or property.

 

5

----

 

**18.****                              ****Assignment and Subleases**. Lessee may not assign or transfer this Lease or sublease the whole orany part of the Premises, without the written consent of Lessor, which shall notbe unreasonably withheld, provided that Lessee shall nevertheless remainprimarily liable to Lessor for the payment of all rent and for the fullperformance of all of the covenants and conditions of this Lease.

 

Lessor shall, however, have the right to sellor transfer the Premises, subject to all of the provisions of this Lease.

 

**19.****                              ****Compliance with Laws**. Lessee agrees to observe and comply with all rules, regulations and lawsnow in effect, or which may be enacted during the continuance of this Lease, byany municipal, county, State or Federal authorities having jurisdiction overthe Premises.

 

**20.****                              ****Lessee’s Default**.  ThisLease is made upon the condition that Lessee shall punctually and faithfullyperform all of the covenants and agreements by Lessee to be performed as hereinset forth, and if any of the following events of default shall occur, to-wit:

 

**A.           **The rent or any other sums required to bepaid by Lessee hereunder, or any part thereof, shall at any time be in arrearsand unpaid for fourteen (14) days after receipt of written notice of defaultfrom Lessor to Lessee; or

 

**B.           **There be any default in the observance orperformance of any of the other covenants, agreements or conditions of thisLease on the part of Lessee to be kept and performed, and said default shallcontinue for a period of thirty (30) days after written notice thereof fromLessor to Lessee (unless such default cannot be reasonably cured within thirty(30) days and Lessee shall have commenced to cure said default within said thirty(30) days and continues diligently to pursue the curing of the same); or

 

**C.           **Any proceedings in bankruptcy, insolvency orreorganization shall be instituted against Lessee, and such proceeding is notstayed within 45 days of its commencement, pursuant to any federal or statelaw, or any receiver or trustee shall be appointed for all or any portion ofLessee’s business or property, or any final, non-appealable execution orattachment in excess of $500,000 shall issue against Lessee or Lessee’sbusiness or property or against the leasehold estate created under this Leaseor Lessee shall be adjudged a bankrupt or insolvent, or Lessee shall make anassignment for the benefit of creditors, or Lessee shall file a voluntarypetition in bankruptcy or petitions for (or enters into) an arrangement forreorganization, composition or any other arrangement with Lessee’s creditorsunder any federal or state law; or

 

**D.           **The leasehold estate hereby created shall betaken on execution or by other process of law;

 

6

----

 

then, and in any of said cases, Lessor, at Lessor’s option, mayterminate this Lease and reenter upon the Premises and take possession thereofwith full right to sue for and collect all sums or amounts with respect towhich Lessee may then be in default and accrued up to the time of such entry,including damages to Lessor by reason of any breach or default on the part ofLessee, or Lessor may, if Lessor elects so to do, bring suit for the collectionof such rents and damages without entering into possession of the Premises orvoiding this Lease.

 

In addition to, but not in limitation of, anyof the remedies set forth in this Lease or given to Lessor by law or in equity,Lessor shall also have the right and option, in the event of any default byLessee under this Lease and the continuance of such default after the period ofnotice above provided, to retake possession of the Premises from Lessee bysummary proceedings or otherwise (and it is agreed that the commencement andprosecution of any action by Lessor in forcible entry and detainer, ejectmentor otherwise, or any execution of any judgment or decree obtained in any actionto recover possession of the Premises, shall not be construed as an election toterminate this Lease unless Lessor expressly exercises Lessor’s optionhereinbefore provided to declare the term hereof ended, whether or not suchentry or reentry be had or taken under summary proceedings or otherwise, andshall not be deemed to have absolved or discharged Lessee from any of Lessee’sobligations and liabilities for the remainder of the term of this Lease) andLessee shall, notwithstanding such entry or reentry, continue to be liable forthe payment of the rents and the performance of the other covenants andconditions hereof and shall pay to Lessor all monthly deficits after any suchreentry in monthly installments as the amounts of such deficits from time totime are ascertained and if, in the event of any such ouster, Lessor rents orleases the Premises to some other person, firm or corporation (whether for aterm greater than, less than or equal to the unexpired portion of the termcreated hereunder) for an aggregate rent during the portion of such new leasecoextensive with the term hereby created which is less than the rent Lesseewould pay hereunder for such period, Lessor may immediately, upon the making ofsuch new lease or the creation of such new tenancy, sue for and recover thedifference between the aggregate rental provided for in said new lease or theportion of the term thereof coextensive with the term created hereunder and therent which Lessee would pay hereunder for such period, together with anyexpenses to which Lessor may be put for brokerage commission, placing thePremises in tenantable condition or otherwise. If such new lease or tenancy is made for a shorter term than the balanceof the term of this Lease, any such action brought by Lessor to collect thedeficit for that period shall not bar Lessor from thereafter suing for any lossaccruing during the balance of the unexpired term of this Lease.

 

In addition to all other sums due and owingfrom Lessee to Lessor, as the result of Lessee’s default in any term orcondition set forth in this Lease, Lessee shall be responsible for and shallpay to Lessor all of Lessor’s costs and expenses, including actual attorneys’fees, incurred by Lessor in enforcing Lessee’s obligations pursuant to thisLease.  However, Lessor acknowledges thatLessor has a duty to mitigate Lessor’s damages in the event of a default byLessee.

 

**21.          Quiet Enjoyment**. Lessor agrees that if the rent aforesaid shall be paid as hereinaboveprovided and Lessee shall keep and perform the covenants of this Lease on thepart of Lessee to be kept and performed, Lessee shall peaceably and quietlyhold, occupy and enjoy the Premises during the term hereof, without hindranceor molestation by Lessor or any person or persons lawfully claiming underLessor.

 

**22.          Lessor’s Remedies; Cumulative, etc.**  Eachright, power and remedy of Lessor provided for in this Lease shall becumulative and concurrent and shall be in addition to every other right, poweror remedy provided for in this Lease or now or hereafter existing at law or inequity or by statute or otherwise, and the exercise or beginning of theexercise by Lessor of any one or more of the rights, powers or remediesprovided for in this Lease or now or hereafter existing at law or in equity orby statute or otherwise shall not preclude the simultaneous or later exerciseby Lessor of any or all other such rights, powers or remedies.

 

7

----

 

**23.          Waiver**.  Any assent, express orimplied, by Lessor to any breach of any agreement or condition hereincontained, or any waiver, express or implied, by Lessor of any such agreementor condition herein contained shall operate as such only in specific instances,and shall not be construed as an assent or waiver of any such agreement orcondition generally or of any subsequent breach thereof.

 

**24.          Signs**.  Lessee shall have the right atall times during the term of this Lease, at Lessee’s sole expense, to erect,install, operate and maintain identifying signs on the Premises provided that,upon the removal of said signs, the Premises are restored to at least as good acondition as existed prior to their installation.

 

**25.          Hazardous Substances**. Lessee shall not cause or permit any hazardous substances to be used,stored, generated or disposed of on, in or about the Premises by Lessee, Lessee’sagents, employees, contractors or invitees; provided, however, that Lessee maykeep and use small quantities of hazardous substances as are necessary in theordinary course of Lessee’s business, and further provided that Lessee shallhandle, store, use and dispose of any such hazardous substance in accordancewith applicable Federal, State and local laws and regulations, and in a mannerwhich shall not cause contamination to the Premises.

 

Lessee shall indemnify and hold Lessorharmless from any liability, claim, demand, order or injury (includingreasonable attorney, consultant and expert fees), arising from Lessee’s, orLessee’s agents’, employees’, contractors’ or invitees’ handling, storage,disposal or release of any hazardous substance in, under or about the Premises,including, without limitation, the cost of any required or necessary repair,cleanup, remediation or detoxification of the Premises.

 

The foregoing covenants and indemnification shallsurvive the expiration of the term of this Lease.

 

The foregoing covenants and indemnification arecumulative to any rights or remedies which Lessor or Lessee may have at law orin equity, and shall not operate to limit such rights or remedies.

 

As used herein, “hazardous substance” meansany substance that is toxic, ignitable, reactive or corrosive, and whosestorage, handling, disposal or transport is regulated by Federal, State orlocal statute, rule, regulation or ordinance, and shall include any material orsubstance that is defined as “hazardous waste,” “extremely hazardous waste” ora “hazardous substance” pursuant to Federal, State or local statute, rule,regulation or ordinance, including, but not limited to, asbestos,polychlorinated biphenyls (“PCBs”) and petroleum. In no event shall Tenant beliable or responsible for any environmental conditions or hazardous substancesexisting prior to the date of this Lease

 

**26.          Holding Over**.  IfLessee remains in possession of the Premises after the expiration of the term,or after termination of this Lease, and without the execution of a new Lease,Lessee shall be deemed to be occupying the Premises as a lessee frommonth-to-month, subject to all the conditions, provisions, and obligations ofthis Lease insofar as they are applicable to a month-to-month tenancy.  The inclusion of this paragraph or acceptanceby Lessor of any rent after the expiration of the term or termination of thisLease shall not constitute permission for Lessee to hold over.  Lessee expressly waives any requirement for Lessorto give Lessee any notice to quit the Premises, whether at the end of the termor during any hold-over period.

 

**27.          Eminent Domain**.  Incase the Premises, or any part thereof, shall be taken by right of eminentdomain, or by other authority of law, after execution hereof, and before expirationof said term, this Lease and said term shall terminate at the election of theLessee; and if the Lessee shall not so elect, then in case of such taking, ajust proportion of rent hereinbefore reserved, according to nature and extentof injuries sustained by the Premises, shall be abated until the Premises, orwhatever may remain thereof, shall have been put in proper condition for useand occupancy.  In case of any suchtaking, the total damages arising therefrom

 

8

----

 

shall be recovered by Lessor, Lessee herebyassigning all rights in or to such damages to Lessor, and the net amountrecoverable and recovered therefor shall be apportioned between Lessor andLessee in such proportions as shall be reasonably determined by Lessor.  It is the intention of the parties, in regardto distribution of damages or indemnity for taking by public authority, toappoint Lessor as the person to whom such damages or indemnity are to be paid,and to provide that such sums shall be distributed in the manner hereinprovided for.

 

**28.          Subordination**.  ThisLease and all rights of Lessee hereunder shall be subject and subordinate tothe lien of any and all mortgages on the underlying financing of the Lessorwhich affect the Premises or any part thereof and to any and all renewals,modifications or extensions of any such mortgages.  Conditioned on Lessee first receiving fromany lien holder of the Premises an executed Subordination, Non-Disturbance andAttornment Agreement in form and content reasonably acceptable to Lessee(“SNDA”),Lesseeshall on demand execute, acknowledge and deliver to Lessor without expense toLessor any and all instruments that may be necessary or proper to subordinatethis Lease and all rights therein to the lien of any such mortgage or mortgagesand each renewal, modification or extension and if Lessee shall fail at anytime to execute, acknowledge and deliver any such subordination instrument,Lessor, in addition to any other remedies available and consequence thereof,may execute, acknowledge and deliver the same as Lessee’s attorney-in-fact andin Lessee’s name.  Lessee herebyirrevocably makes, constitutes and appoints Lessor, Lessor’s successors andassigns, as Lessee’s attorney-in-fact for that purpose.

 

**29.          Notices**.  Any notice or othercommunication required by or permitted to be given in connection with this Leaseshall be in writing, and shall be delivered in person or sent first class mail,certified or registered mail, return receipt requested, postage prepaid, to therespective parties at the addresses set forth below, or at such other addressas may be specified from time to time in writing delivered by the other party:

 
| **Lessor**:                       |       |                     |
|-----------------------------------|------------|--------------------------|
| **J.J.C. Valley Properties, LLC** |       |                     |
| Attn: Jeffrey E. Corcoran         |       |                     |
| N100 Craftsmen Drive              |       |                     |
| Greenville, WI 54942              |       |                     |
|                              |       |                     |
| **With a copy to:**               | ** ** | ** **               | **Metzler, Timm, Treleven & Hermes, S.C.** |
|                              |       | Attn: David J. Timm      |
|                              |       | 222 Cherry Street        |
|                              |       | Green Bay, WI 54301-4223 |
|                              |       |                     |
| **Lessee**:                       | ** ** |                     |
| **ISI Controls, Ltd.**            | ** ** |                     |
| 12903 Delivery Drive              |       |                     |
| San Antonio, Texas 78247          |       |                     |
|                              |       |                     |
| **With a copy to:**               | ** ** | ** **               | **D. Hull Youngblood, Jr.** |
|                              |       | K&L Gates            |
|                              |       |                     | 111 Congress Avenue |
|                              |       |                     | Suite 900 |
|                              |       |                     | Austin, Texas 78701 |
|                                   |            |                          |  |  |

 

9

----

 

**30.          Construction of Lease**.  ThisLease shall be construed in accordance with the laws of the State of Wisconsin,and shall further be construed without regard to any presumption or rule requiringconstruction against the party causing the Lease to be drafted.

 

**31.          Recordation of Memorandum of Lease**. Neither Lessor nor Lessee shall record thisLease.  However, either party may recorda Memorandum of Lease, providing notice of Lessee’s interests described hereinfor the entire Lease term, including extensions.  Said Memorandum of Lease shall not containany specific information about the Lease rental payment amounts.

 

**32.          Entire Lease**.  ThisLease evidences the entire agreement between the parties hereto with respect tothe matters provided for herein and there are no agreements, representations orwarranties with respect to any matters provided for herein other than those setforth herein.

 

**33.          Severability**.  Theparties agree that, if any provision of this Lease shall, under anycircumstances, be deemed invalid or inoperative, this Lease shall be construedwith the invalid or inoperative provision deleted and the rights andobligations of the parties shall be construed and enforced accordingly.

 

**34.          Amendment and Modification**.  Theparties hereto may amend, modify or supplement this Lease in such manner as maybe mutually agreed upon by them in writing.

 

**35.          Binding Effect**.  ThisLease shall be binding upon and inure to the benefit of the parties, theirrespective heirs, successors, personal representatives and assigns.

 

**36.          Arbitration**.  Except for matters related to theLessee’s obligation to timely pay rent, when due and any related action toterminate Lessee’s tenancy and evict Lessee from the Premises; disputes arisingunder this Lease or in any way relating to the relationship of Lessee andLessor as contemplated in this Lease, shall be resolved through bindingarbitration located in Appleton, Outagamie County, Wisconsin.  Arbitration shall be initiated by eitherparty providing to the other party written notice of a request for arbitrationwhich such notice shall include facts of sufficient detail in order to apprisethe other party of the nature of the alleged dispute.  Each party shall appoint one (1) representativeand said representatives shall, thereafter, mutually agree upon and select one (1) personwho shall serve as the parties’ arbitrator hereunder (the “Arbitrator”).  If the parties’ representatives are unable toagree, as determined in the sole discretion of Lessor’s representative, as tothe appointment of the Arbitrator, then the Arbitrator shall be selected byLessor’s representative with notice of said selection being delivered to Lesseein writing; provided, however, that the Arbitrator selected solely by Lessor’srepresentative must be a former Wisconsin Circuit Court judge.  The initiating party’s representative shallbe identified in the initiating party’s initial notice.  The other party’s representative shall benamed, in writing, by delivery of a notice to the initiating party within five (5) daysof said party’s receipt of the initial arbitration notice.  Each of parties’ representatives shall bemembers in good standing of the Wisconsin State Bar Association and who shallhave expertise in commercial disputes and/or business transactions.  The parties’ representatives shall select theArbitrator who shall also be a member in good standing of the Wisconsin StateBar Association and who shall also have expertise in commercial disputes and/orbusiness transactions.   If either Lesseeor Lessor fails to timely appoint their representative, then the other party’stimely appointed member may select the Arbitrator.  The Arbitrator shall provide a writtendecision stating his findings based on the facts of any dispute and theapplicable law.  Except as specificallyset forth herein, all matters relating to the arbitration proceedingscontemplated in this Lease, shall be governed by and be conducted in accordancewith Chapter 788 of the Wisconsin Statutes, as may be amended from time totime.  The decision of the Arbitratorshall be conclusively binding on the parties hereto.

 

10

----

 

Theterms of this Section 36, with respect to arbitration, are selfexecuting.  If any party refuses orneglects to appear at or participate in any arbitration proceeding conductedpursuant to the terms and conditions of this Lease, after reasonable notice,the Arbitrator shall proceed ex parte to decide the matter in accordance withthe evidence as presented by the participating party.  All hearings conducted by the Arbitratorshall be conducted within forty-five (45) days of the date of appointment ofthe Arbitrator and all discovery deadlines and other time sensitive mattersshall be scheduled consistent therewith. Not later than seven (7) days prior to any arbitration hearing,including, but not limited to, a final hearing, the parties shall deliver toone another and to the Arbitrator, a written list of the names of all witnessesand a specific written summary of the testimony expected to be provided by eachwitness.  In addition, each party shallprovide to the other party copies of all documents intended to be presented atsaid hearings within said seven (7) day time period.  No witness or document shall be allowed totestify at or shall be allowed presented at said hearings which has not been disclosedto the other party and to the Arbitrator as required in the precedingsentences.

 

Inany arbitration proceeding conducted pursuant to the terms and conditions ofthis Lease, the prevailing party, as determined by the Arbitrator, shall beentitled to recover from the non-prevailing party, in addition to such otherrelief as may have been provided by the Arbitrator, the prevailing party’sreasonable attorneys’ fees and costs incurred in connection with thearbitration proceeding.  If neither partyis determined by the Arbitrator to have prevailed on all issues, thenthe Arbitrator shall be entitled to, but shall not be obligated to, assesscosts and reasonable attorneys’ fees, against the parties the Arbitrator deemsappropriate.  Under all circumstances,the costs and expenses of the Arbitrator shall be split equally between Lesseeand Lessor.

 

**IN WITNESS WHEREOF**, the parties hereto have executed this Leaseon the date first written above.

 
| **LESSOR**:                       |                                      | **LESSEE**:                        |
|-----------------------------------|-------------------------------------------|------------------------------------|
| **J.J.C. VALLEY PROPERTIES, LLC** |                                      | **ISI Controls, Ltd.**             |
|                              |                                      | By: Metroplex Control Systems, Inc |
|                              |                                      | Its: Sole General Partner          |
|                              |                                      |                               |
| By:                               |    /s/ Jeffrey E. Corcoran | By:                                |    /s/ Sam Youngblood |
|                              |  Jeffrey E. Corcoran, Member         |                               |  Sam Youngblood |
|                              | Its:                                      |   CEO                    |
|                              |                                      |                               |
| By:                               |    /s/ Jeffery D. Corcoran |                               |   |
|                              |  Janell D. Corcoran, Member          |                               |   |

 

**THIS INSTRUMENT WAS DRAFTED BY****:**

 

Attorney David J. Timm

Metzler, Timm, Treleven & Hermes, S.C.

222 Cherry Street

Green Bay, WI  54301-4223

(920) 435-9393

 

[Signature Page to JJC/ISI LeaseAgreement]

 

11

----