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EXHIBIT 10.1
Mn/DOT Agreement No. 73526
AGREEMENT
THIS AGREEMENT is made and entered into by the State of Minnesota acting
through its Commissioner of the Department of Transportation ("Mn/DOT" or
"State") and Minnesota Logos, Inc. (a wholly owned subsidiary of Interstate
Logos, Inc. which is located at 0000 Xxxxxxxxx Xxxx., X.X. Xxx 00000, Xxxxx
Xxxxx, Xxxxxxxxx 70896) and Global Speciality Contractors, Inc., 000 Xxxx
Xxxxxxxxx Xxxxx, Xxxxxxxxxx, Xxxxxxxxx 00000, doing business as the partnership
Minnesota Logos, which is located at 000 Xxxx Xxxxxxxxx Xxxxx, Xxxxx 000,
Xxxxxxxxxx, Xxxxxxxxx 00000 ("Minnesota").
WHEREAS, pursuant to Minnesota Statutes Section 160.80, Subd. 2 (1994),
Mn/DOT requested proposals from private commercial enterprises for the
expansion, management and operation of the Logo Sign Franchise Program
("Franchise Program" or "Program") to provide logo signs on the right of way of
Minnesota interstate highways and portions of selected divided trunk highways,
and
WHEREAS, Mn/DOT has selected Minnesota Logos to manage and operate the
Franchise Program in Minnesota.
NOW THEREFORE, THE PARTIES AGREE TO THE FOLLOWING:
GRANT OF FRANCHISE
1. Mn/DOT grants to Minnesota Logos and exclusive franchise to manage and
operate the Franchise Program on the Minnesota trunk highways shown in
Exhibit 1, which is attached hereto and incorporated herein and such
grant is made pursuant to the terms and conditions set forth herein.
Minnesota Logos agrees to perform the duties and responsibilities set
forth and specified in this agreement and to comply with all of the
terms and conditions herein. Exhibits 2-5 are attached to this
agreement and incorporated herein.
2. The term of this agreement shall commence upon execution and approval by
the parties and appropriate State of Minnesota officials and shall
remain in effect until December 31, 2005, unless terminated earlier
pursuant to the terms of this agreement.
3. The term of the exclusive franchise granted hereunder shall commence on
August 1, 1995, and will expire December 31, 2005, unless terminated
earlier pursuant to the terms of this agreement.
4. Mn/DOT's authorized agent for the purposes of the administration of this
agreement is Xxxxx X. Xxxxx, Office of Maintenance, 000 Xxxx Xxxxxxx
Xxxxxxxxx, XX 000, Xx. Xxxx, Xxxxxxxxx, 00000, or her successor. Mn/DOT
shall notify Minnesota Logos of any replacement of Mn/DOT's authorized
agent.
5. Minnesota Logos' managing partner and authorized agent for the purposes
of the administration of this agreement is Xxxxxxx Xxxxxxx, P.O. Box
66338, 0000 Xxxxxxxxx Xxxx., Xxxxx 0X (70808), Xxxxx Xxxxx, Xxxxxxxxx
00000, or his successor. Minnesota
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Mn/DOT Agreement No. 73526
Logos shall notify Mn/DOT of any replacement of Minnesota Logos'
managing partner and authorized agent.
CONTRACT TERMS AND CONDITIONS
1.0 DEFINITIONS
The following terms used throughout this agreement shall have the
definitions as hereinafter stated:
Business - a commercial establishment that provides a motorist service
of GAS, FOOD, LODGING or CAMPING.
Business Panel - A separately attached sign panel to show the brand,
symbol, trademark, name or combination of these, for a motorist service
available on a crossroad at or near an interchange.
Commissioner - Commissioner of Transportation
Crossroad - a marked route or other public road intersecting an eligible
freeway or divided trunk highway to which access is provided at an
interchange.
Exit Ramp - a connecting roadway between two intersecting roads that are
grade separated.
Exit Ramp Logo Sign - a logo sign along an exit ramp.
Franchise Program or Program - Minnesota's Logo Sign Franchise Program.
Interchange - a grade separated intersection with ramps to provide
movement between roadways.
Logo Sign - a logo sign consists of a logo sign panel and sign supports
which is located on the mainline or ramp (for Type A signs this includes
the footings). It does NOT include the business panels which attach to
the logo sign panel.
Logo Sign Panel - a rectangular sign panel consisting of the words GAS,
FOOD, LODGING or CAMPING and directional information.
Minnesota Logos - the Franchise Program contractor consisting of
Minnesota Logos, Inc., and Global Speciality Contractors, Inc., OR
either of them.
Mn/DOT - Minnesota Department of Transportation
Motorist Service - GAS, FOOD, LODGING or CAMPING.
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Mn/DOT Agreement No. 73526
Rural - all Minnesota counties except the seven-county Minneapolis/St.
Xxxx metropolitan area. (See urban).
Seasonal Business - a gas, food, lodging or camping facility that is
open for business up to seven (7) months per year.
State - State of Minnesota
Urban - the Minneapolis/St. Xxxx metropolitan area, which includes the
counties of Anoka, Xxxxxx, Dakota, Hennepin, Xxxxxx, Xxxxx and
Washington.
2.0 RESPONSIBILITIES OF THE PARTIES
2.01 SCOPE OF THE FRANCHISE PROGRAM
The scope of the Franchise Program shall be to continue its
expansion and maintenance. In carrying out the scope of the
Franchise Program, Minnesota Logos shall furnish, install and
maintain all logo signs relating to gas, food, lodging and
camping; market all eligible spaces for business panels to be
installed on mainline and exit ramp logo signs; and install and
maintain all marketed business panels on eligible routes. The
parties shall perform the following responsibilities and duties
during the term of this agreement for the purpose of implementing
the scope of the Franchise Program.
2.02 BUY-OUT
Minnesota Logos shall buy from Minnesota Logo Sign Group, which
is located in St. Cloud, Minnesota, all in place logo signs
regardless of location, including any logo signs on which no
business panels are displayed. Minnesota Logos' buyout of
existing logo signs from Minnesota Logo Sign Group shall be
completed to the satisfaction of Mn/DOT prior to August 1, 1995.
Minnesota Logos shall notify Mn/DOT by July 1, 1995, whether or
not Minnesota Logos shall be able to reach an agreement with
Minnesota Logo Sign Group by August 1, 1995. The buy-out formula
for purchase of those logo signs shall be:
P = (N/12 x O)
P = Total buy-out price
N = Remaining years of unamortized sign costs
O = Cost of structures, including all costs from January 1, 1986
through July 31, 1995, found in the following Minnesota Logo Sign
Group's general ledger accounts:
Account 150 - Background Panel Purchases
Account 950 - Commission Expense
Account 970 - Repair and Maintenance
Account 972 - Logo Installs and Removals
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Mn/DOT Agreement No. 73526
Structure costs will be amortized over a 12 year period on a sign
by sign basis.
Minnesota Logos may negotiate to buy any or all marketing assets
from Minnesota Logo Sign Group as Minnesota Logos sees fit, but
it shall not be required to do so as a condition of this
agreement.
If Mn/DOT eliminates the rural non-interstate highways from the
program, Mn/DOT will buy from Minnesota Logos the logo signs on
the affected rural non-interstate highways at the formula
specified above.
If, at the expiration or termination of this agreement, the sign
franchise is awarded to one or more third parties for
continuation of the Franchise Program, Minnesota Logos shall sell
to the subsequent franchisee(s) its logo signs on terms agreeable
to both parties. In the event that Minnesota Logos and any third
party successor cannot reach an agreement with respect to the
value of the logo signs within 30 days from the date of the
execution and approval of the next subsequent franchise
agreement, Minnesota Logos shall notify Mn/DOT and Mn/DOT shall
make a final determination as to the amount which shall be paid
for the logo signs. Minnesota Logos shall submit to Mn/DOT all
financial and other records necessary to calculate the value of
the logo signs in accordance with the following formula:
P = (N/12 X 0)
P = Total buy-out price
N = Remaining years of unamortized costs (12 year
amortization period)
0 = Cost of structures
The cost of structures will be the costs reflected in the
depreciation schedule of Minnesota Logos which costs must be
verifiable and acceptable to Mn/DOT for those signs in the
Franchise Program. Mn/DOT's determination of the cost of the
logo signs shall be final and binding on both Minnesota Logos and
any subsequent franchise and any appeal shall be limited as if
from the decision of an arbitrator. Under no circumstances shall
Mn/DOT be responsible to compensate Minnesota Logos for such
rights or property whether or not they are sold to another party.
Mn/DOT is under no obligation to either continue the sign
Franchise Program beyond the term of this agreement or to
continue the Program in the same manner as it is currently
operated. In the event that the logo sign program is
discontinued or if the logo signs are not incorporated into the
subsequent Franchise Program, Minnesota Logos shall remove all
logo signs and posts and restore the various sites to their
original condition or to a condition satisfactory to Mn/DOT.
Such removal and restoration shall be completed with 30 days from
the expiration or termination of this agreement unless a longer
period of time is permitted by Mn/DOT.
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Minnesota Logos may sell to any third party successor in the sign
franchise program its marketing assets and existing business
leases but neither Mn/DOT nor any subsequent franchisee shall be
responsible to acquire such assets or leases.
2.03 EXCLUSIVE FRANCHISE
Subject to the terms and conditions set forth herein, Mn/DOT
grants to Minnesota Logos the exclusive right to construct,
maintain, and operate the Franchise Program from August 1, 1995,
to December 31, 2005, or other such date as may be allowed under
the terms of this agreement. Minnesota Logos shall construct,
install and maintain logo signs at eligible locations (as
specified in Exhibit 1) even if there is only one eligible
business advertiser requesting a business panel.
2.04 LAWS AND REGULATIONS
In fulfilling the duties and responsibilities in this agreement,
the parties shall be governed by and comply with all applicable
federal and state laws and regulations as specified in paragraph
11.0.
2.05 MINNESOTA OFFICE
Minnesota Logos shall maintain an office in the State of
Minnesota and at least one full time employee at this office
shall have the authority and capability to negotiate and
administer business leases and maintain the Program. Minnesota
Logos shall maintain a toll-free (800) telephone number at this
office. When the office is closed, a recorded message shall be
used to inform callers of office hours and other information.
2.06 RESPONSIBLE EMPLOYEES
Minnesota Logos shall employ individuals and hire subcontractor
who are capable, responsible and experienced in the work being
performed. Mn/DOT may, at its discretion, require Minnesota
Logos to remove from the Program any employee who endangers
persons or property, or whose continued employment pursuant to
this agreement is inconsistent with the purpose of the Franchise
Program.
2.07 INTERCHANGE ELIGIBILITY
Prior to marketing a particular interchange, Minnesota Logos
shall make a preliminary determination of the eligibility of that
interchange and submit site plans of proposed logo sign locations
to Mn/DOT's State Traffic Engineer for approval.
2.08 PERMIT
Prior to start of construction of any logo signs at a specific
interchange, Minnesota Logos shall apply to the appropriate
Mn/DOT district or division office for a
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permit. Every time a permit is desired by Minnesota Logos after
the initial written permit approval, verbal approval from the
District Maintenance Engineer or his/her representative shall
suffice. Notwithstanding any language to the contrary in the
permit, the permit shall expire at the termination of the
franchise agreement.
2.09 TRAFFIC CONTROL
Traffic control shall be consistent with the provisions of Part
VI of the current edition of the Minnesota Manual on Uniform
Traffic Control Devices (MN MUTCD), as specified in Exhibit 2.
2.10 COPIES OF AS BUILT PANELS
Within ninety (90) days after the installation of a logo sign
panel or panels at an interchange, Minnesota Logos shall submit
to Mn/DOT's State Traffic Engineer two copies of the as built
panels at that interchange. The copies shall identify the logo
sign supports as Type A or Type D.
2.11 REPORTS
Once a year, no later than the 15th day of January, Minnesota
Logos shall provide a detailed printout of all logo sign field
inventories to Mn/DOT's authorized agent. On a quarterly basis,
no later than the 15th day of April, July, October and January,
Minnesota Logos shall provide a quarterly update that includes
changes that have accumulated since the previous report.
Minnesota Logos shall also submit such other reports as Mn/DOT
may reasonably require from time to time.
2.12 ANNUAL COMPLIANCE CHECK
On or before January 15 of each agreement year, Minnesota Logos
shall certify in writing to Mn/DOT's authorized agent that all
participating businesses meet the minimum criteria to qualify for
the Franchise Program.
2.13 BUSINESS LEASE RATES
Advertising rates to businesses for the display of business
panels shall be $45 per month per mainline logo sign and $10 per
month per exit ramp logo sign. The rates shall be set forth in
writing by Minnesota Logos, and made available to the public.
Costs for the business panel may not be included in such charges
but may be charged for separately by Minnesota Logos, OR the
business panel may be supplied by the business. Minnesota Logos
shall not increase the rates for the duration of the franchise
(August 1, 1995, through December 31, 2005).
2.14 SEASONAL BUSINESSES
Minnesota Logos may charge seasonal businesses only for the
months such
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businesses are actually open, except that Minnesota Logos may
require seasonal businesses to pay advertising charges for a
minimum of five (5) months per year. Advertising fees for
portions of months shall be prorated. Minnesota Logos shall
remove, cover or identify with a "CLOSED" plaque, the business
panel whenever a seasonal business is closed, and it may charge
the business a reasonable fee thereof.
2.15 LENGTH OF BUSINESS LEASE
The length of a business lease shall be at least one year and not
more than three years. Leases may be renewed automatically, but
Minnesota Logos must notify the business at least sixty (60) days
prior to expiration. The business must be allowed to renew or
cancel its lease up to its anniversary date. The business lease
shall include all relevant bumping and termination language. The
standard lease language shall be subject to Mn/DOT approval.
Each business lease shall include a provision to the effect that
when the agreement between Minnesota Logos and Mn/DOT expires or
is terminated, all business leases shall expire. When this
agreement expires or is terminated, Minnesota Logos shall refund
to the business advertisers the balance of any prepaid leases.
2.16 PAYMENT TO MN/DOT
On or before January 15, 1996, and continuing on or before
January 15 of each subsequent agreement year, Minnesota Logos
shall pay to Mn/DOT an annual administrative fee of $50,000,
payable to the Commissioner of Transportation. The
administrative fee will reimburse Mn/DOT in whole or in part for
agreement administration, permit administration and traffic
engineering review.
2.17 INTERFERENCE DUE TO HIGHWAY CONSTRUCTION
Minnesota Logos shall advise all business lease holders that
highway construction may interfere with the location and/or
visibility of logo signs.
2.18 INTERFERENCE DUE TO OTHER ACTIVITIES
Minnesota Logos shall advise all business lease holders that some
activities or circumstances may require the removal or relocation
of logo signs. Such activities include, but or not limited to,
1) additional interchange(s) are constructed; 2) new major
traffic generators become eligible for signing; or 3) new
regulatory, warning or guide signs are required to be installed.
Mn/DOT reserves the right to remove or relocate logo signs, and
it shall not be liable for claims for costs associated with such
removal or relocation. Minnesota Logos shall refund to the
business advertisers the balance of any unearned, prepaid leases.
3.0 ELIGIBILITY CRITERIA FOR BUSINESS PANELS
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To be eligible for a business panel on a logo sign panel, a business
establishment must be open for business; have a sign on site which both
identifies the business and is visible to motorists; and meet the
following criteria:
a) "Gas Facilities" shall include:
1) Vehicle services including fuel and oil;
2) Restroom facilities and drinking water;
3) Continuous, staffed operation at least 12 hours a day, 7
days a week;
4) Public access to a telephone.
b) "Food Facilities" shall include:
1) Provisions for serving food;
2) State or local licensing or approval, where required;
3) Continuous, staffed operation at least 10 hours a day, 7
days a week;
4) Public access to a telephone.
c) "Lodging Facilities" shall include:
1) Adequate sleeping accommodations;
2) Public access to a telephone;
3) State or local licensing or approval, where required.
d) "Camping Facilities" shall include:
1) Provisions for camping;
2) Adequate parking accommodations;
3) Sanitary facilities and drinking water; and
4) State or local licensing or approval, where required.
4.0 STANDARDS FOR LOGO SIGNS AND SIGN DESIGN
Standards for logo signs shall comply with the provisions specified in
Exhibit 3. Sign design shall comply with the provisions specified in
Exhibit 4. Exceptions shall be submitted to Mn/DOT by Minnesota Logos
for evaluation and approval on a case by case basis prior to marketing.
5.0 MAINTENANCE OF SIGNS
5.01 MAINTENANCE
Minnesota Logos shall be responsible for regular sign clean-up,
including removal of graffiti, cleaning of the panels, supply of
replacement parts and all general maintenance of the sign panels.
Minnesota Logos shall inspect panels and sign supports at
reasonable intervals for any damaged or broken parts and, at its
own expense, shall repair or replace damaged or broken parts
within a period not to exceed seven (7) days after it becomes
aware of the damage or breakage. If the damaged or broken parts
create a hazardous situation, Minnesota Logos shall correct the
situation without undue delay. Mn/DOT reserves the right to take
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corrective action as it deems necessary, and Minnesota Logos
shall be responsible for reimbursing Mn/DOT for such action.
5.02 REPLACEMENT AND REFURBISHMENT OF LOGO SIGNS
Minnesota Logos shall replace or refurbish all logo sign panels,
including those purchased from Minnesota Logo Sign Group, on a
twelve (12) year cycle as specified in Exhibit 5.
6.0 CRITERIA FOR LOGO SIGNS
Criteria for logo signs shall comply with the provisions of the MN
MUTCD, Part II-G (Exhibit 2), except as modified and supplemented as
follows:
6.01 SIGN LIGHTING
Electrical devices specifically designed to illuminate logo sign
panels shall not be permitted.
6.02 DISTANCE TO SERVICES - RURAL
The maximum distance that an eligible rural service can be
located from the main traveled roadway to qualify for a business
panel shall not exceed three (3) miles in either direction,
except that within the 3-mile limit, services of the type being
considered are not available, the limit of eligibility may be
extended in 3-mile increments until one (1) or more services of
the type being considered are reached. The maximum distance that
eligible services can be located from the main traveled way to
qualify for a business panel shall not exceed fifteen (15) miles
in either direction.
6.03 DISTANCE TO SERVICES - URBAN
The maximum distance that an eligible urban service can be
located from the main traveled roadway to qualify for a business
panel is as follows:
GAS - one mile
FOOD - two miles
LODGING - three miles
CAMPING - ten miles
6.04 MEASURING DISTANCE TO SERVICES
The distance to a qualified business, rural or urban, shall be
measured by vehicle distance via the most direct route available
from the center point of an interchange (the point where the
center of the freeway or expressway intersects the center of the
crossroad) to the nearest edge of the driveway of the business.
Xxx
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00
Xx/XXX Xxxxxxxxx Xx. 00000
measurement shall be based on government right-of-way maps or
plans as to the location of a terminus, all center points, and
driveway location of a particular business.
6.05 TRAVEL DISTANCE
The travel distance to a business (to be displayed in one (1)
mile increments on logo sign panels at exit ramps) shall be
measured by vehicle distance via the most direct route available
from the center point of the terminus of the exit ramp to the
nearest edge of the driveway of the business. The measurement of
travel distance shall be based on government right-of-way maps or
plans as to the location of a terminus, all center points, and
driveway location of a particular business.
6.06 SERVICE PRIORITIES AND NUMBER OF SIGNS
Service priorities shall be displayed in the following order:
gas, food, lodging and camping. When allowed according to
Exhibit 3, the number of logo signs permitted shall be limited to
one for any one type of service along an approach to an
interchange, up to a maximum of four (4) logo signs at any
eligible approach as shown in Exhibit 2. However, when the
number of signs are limited at any given approach, up to three
types of services may be displayed on a logo sign panel according
to these guidelines:
If two types of service exist at an interchange, and only
one logo sign can be erected, the sign shall provide space
for three business panels for each type of service. If
three types of service exist at an interchange, and only
one logo sign can be erected, the sign shall provide space
for two business panels for each type of service. If four
types of service exist at an interchange, and only one
logo sign can be erected, the sign shall provide space for
two business panels for each of the following three types
of service--gas, food, lodging.
At those interchanges where two logo signs are to be erected on
one approach to an eligible interchange, and only two types of
services have a total of at least twelve qualifying businesses
(one service with less than six and another service with more
than six), the following shall apply:
For the service that has more than six eligible
businesses qualifying, the six closest eligible
businesses shall be displayed on one logo sign
panel. The second logo sign panel shall display
all of the qualifying businesses of the second type
of service (less than 6), plus the remaining
qualifying businesses not displayed on the first
logo sign panel until the panel is filled with the
maximum number of business panels (6).
Businesses of one type of service may bump displayed businesses
of another type of service only according to Mn/DOT criteria.
Businesses will be bumped from the
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Program according to procedures specified in paragraph 6.08. The
combination of services and number of business panels for each
type of service are subject to Mn/DOT approval. Exceptions shall
be approved by Mn/DOT's State Traffic Engineer on a case by case
basis.
6.07 BUSINESS SIGNING PRIORITY
Where there are more eligible businesses than the number of
business panels permitted on a logo sign panel, consistent with
the provisions of paragraph 6.0, businesses closer to an
interchange shall be given priority over businesses further from
that interchange. Services may be mixed on logo sign panels
consistent with the provisions of paragraph 6.06.
6.08 BUMPING - BUSINESS PANELS
The purpose of the Program is to provide advertising services to
the motoring public on the basis of a business's relative
proximity to an interchange. Therefore, the closest six
applicants for gas, food, lodging and camping that meet the
current criteria at the time of the initial application will have
the highest priority and will be permitted to participate in the
Program. If a qualified business of the same type of service
which is closer in distance applies for a business panel and the
maximum number of businesses have already been displayed at a
particular interchange, the business which is farthest from the
interchange will be bumped from the Program one (1) year from the
date of written notification of the intent to bump, or upon
expiration of its business lease, whichever occurs first. This
provision shall be stated in the lease.
6.09 REMOVAL - LOGO SIGNS
Logo Signs may be removed from the Program if the requirements
specified in Exhibit 3 cannot be met to accommodate any of the
following: 1) additional interchange(s) are constructed; 2) new
major traffic generators become eligible for signing; and/or 3)
new regulatory, warning or guide signs are required to be
installed. Minnesota logos shall refund to the business
advertisers the balance of any unearned, prepaid leases. This
provision shall be stated in the business lease.
6.10 BUSINESSES THAT ARE SUBSTANTIALLY ELIGIBLE
Subject to approval by Mn/DOT, businesses that are substantially
eligible for the Program under paragraph 3.0 may participate in
the Program consistent with paragraphs 6.06 and 6.07. However,
such businesses are subject to bumping. At such time that a
similar type eligible business enters in the Program and the sign
panel(s) are completely filled, the further substantially
eligible business shall be bumped from the program one (1) year
from the date of written notification of the intent to bump, or
upon expiration of its business lease, whichever occurs first.
Minnesota logos shall confer with and receive approval from
Mn/DOT's authorized
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agent prior to including substantially eligible businesses in the
program.
6.11 TRAILBLAZING SIGNS
If a business neither abuts the crossroad nor has direct access
to the crossroad, that business shall not be allowed to
participate in the Program until all necessary directional signs
have been installed. Minnesota Logos shall seek approvals and
coordinate the installation of trailblazing signs with all
appropriate road authorities. All costs for fabrication and
installation of trailblazing signs shall be the responsibility of
the business advertiser.
7.0 TERMINATION
7.01 DEFAULT
Mn/DOT may terminate this agreement for default or breach of
contract. An act of default or breach of contract includes, but
is not limited to, the following:
1) Minnesota Logos fails to perform any material obligation
required under this agreement; OR
2) Minnesota Logos dissolves, becomes insolvent or is
declared bankrupt; OR
3) Minnesota Logos misrepresents the program to business
advertisers.
After an act of default or breach of contract, Mn/DOT will
provide written notice to Minnesota Logos. Minnesota Logos shall
have ten (10) business days after such written notice to rectify
or correct an act of default or breach of contract. If Minnesota
Logos fails to satisfactorily rectify or correct its default or
breach of contract within ten (10) business days after such
notice, Mn/DOT may by written notice terminate the agreement
immediately or at such time as Mn/DOT shall determine.
A notice shall be considered duly served when it is delivered
either at Minnesota Logos' Minnesota business office or by
certified or registered mail to Minnesota Logos' last known
business address.
7.02 EXCEPTIONS TO DEFAULT
Minnesota Logos shall not be in default or breach of contract if
it is delayed in or prevented from performing the terms and
conditions of the agreement or from remedying the default or
breach of contract because of the following:
a) strike or other labor disputes; OR
b) any order, directive, or other interference by municipal,
state, federal or
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other governmental official or agency materially affecting
the performance of Minnesota Logos under the agreement; OR
c) any other cause beyond the control of Minnesota Logos,
provided, however, that if and when the occurrence or
condition which delayed or prevented the remedying of such
default shall cease or be removed, it shall be the
obligation of Minnesota Logos, without further delay, to
commence the correction of such default or to continue the
correction thereof.
The delay or failure of Mn/DOT at any time to insist upon a strict
performance of any of the terms and conditions and covenants of this
agreement shall not be deemed a waiver of that breach or any subsequent
breach or default in the terms, conditions and covenants of the
agreement.
8.0 OWNERSHIP OF THE FRANCHISE PROGRAM AT TERMINATION
8.01 OWNERSHIP AT TERMINATION
If Mn/DOT terminates the agreement with Minnesota Logos under
paragraph 7.01, ownership of the franchise rights and any rights
in the logo signs constructed at the various interchanges shall
pass to Mn/DOT at the effective date of termination, and
Minnesota Logos shall not be entitled to any compensation from
Mn/DOT.
8.02 BUSINESS PANELS AT TERMINATION
Minnesota Logos shall include in all of its business leases with
its advertisers a provision to the effect that in case of
termination of Minnesota Logos' agreement with Mn/DOT, the
unexpired portions of such leases shall be canceled and Minnesota
Logos shall refund to the business advertisers any unearned,
prepaid charges.
When the program expires or is terminated, Minnesota Logos,
before or on the date of expiration or termination, shall either
remove and return the business panels to the respective
businesses, OR the business panels are to remain attached to the
logo sign panels and become the responsibility of the franchise
successor or Mn/DOT. Minnesota Logos shall refund to the
business advertisers the balance of any prepaid leases.
8.03 NO FINANCIAL GUARANTEE
Mn/DOT does not guarantee that Minnesota Logos will make a
profit, nor shall Mn/DOT be responsible for any financial
obligations of Minnesota Logos.
9.0 ASSIGNMENT
Minnesota Logos shall not sell, transfer, assign or otherwise dispose of
this franchise
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agreement or any portion thereof, or of its right, title or interest
therein, or of any of its assets without the prior written consent of
Mn/DOT. Any such attempted disposition by Minnesota Logos without
Mn/DOT's consent shall be an act of default, and Mn/DOT may terminate
the franchise agreement pursuant to the terms of paragraph 7.01.
Minnesota Logos may assign a security interest in rents from its
business leases to its lender. Mn/DOT consents to an assignment and
security interest in the rents from the business leases on the condition
that the assignment and security interest given the lender shall be
subject to this agreement and subordinate to any contractual rights of
Mn/DOT or the advertisers. No security interest may be given the lender
in any signs and appurtenances placed on Mn/DOT right-of-way.
10.0 BOOKS AND RECORDS
Pursuant to Minnesota Statutes Section 16B.06, Subd. 4 (1994), the
books, records, documents and accounting procedures and practices of
Minnesota Logos relevant to this contract shall be subject to
examination by Mn/DOT, the State of Minnesota auditor or the legislative
auditor.
11.0 LAWS AND REGULATIONS
11.01 NONDISCRIMINATION
Any and all services or goods furnished by Minnesota Logos and
its suppliers and subcontractors shall be provided pursuant to
all state and federal laws and regulations, including all
applicable provisions of Minnesota Logos Statutes Chapter 363
(1994), the "Minnesota Human Rights Act". Minnesota Logos agrees
that it will comply with the Americans with Disabilities Act of
1990 and all rules and regulations thereunder.
11.02 JURISDICTION
This agreement shall be governed by the laws of the State of
Minnesota.
11.03 FEDERAL AND STATE LAWS
Minnesota Logos shall comply with all other applicable federal
and state laws and rules relative to the construction and
operation of the Program.
11.04 DATA PRACTICES ACT
To the extent that Minnesota Logos takes possession of, or has
access to, the private, nonpublic, protected nonpublic, or
confidential data of Mn/DOT, Minnesota Logos agrees to comply
with the requirements of Minnesota Statutes Chapter 13 (1994),
the "Data Practices Act". Minnesota Logos agrees to indemnify,
save, and hold harmless Mn/DOT, its agents and employees, from
all
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Mn/DOT Agreement No. 73526
claims arising out of, resulting from, or in any manner
attributable to Minnesota Logos' violation of any provision of
the Data Practices Act. In the event that Minnesota Logos
subcontracts any or all the work to be performed under this
agreement, Minnesota Logos shall retain responsibility under the
terms of this paragraph for such work.
11.05 TARGETED GROUP BUSINESSES
Minnesota Logos agrees to comply with Minnesota Statutes Section
16B.19 (1994) to ensure that Targeted Group Businesses have the
maximum opportunity to participate in the performance of
contracts and subcontracts.
11.06 SUBCONTRACTORS
Minnesota Logos agrees that any and all subcontractors and
suppliers of goods and services shall be required to comply with
the applicable laws, regulations and agreement terms as herein
required of Minnesota Logos.
12.0 INDEMNITY AND INSURANCE
12.01 HOLD HARMLESS
Minnesota Logos agrees to indemnify, save and hold harmless
Mn/DOT and the State and all of its agents and employees from any
and all claims, demands, action or causes of action of whatsoever
nature or character arising out of or by reason of Minnesota
Logos' obligations and responsibilities under the franchise
agreement.
Minnesota Logos further agrees to defend at its sole cost and
expense any action or proceeding commenced for the purpose of
asserting any claim of whatsoever character arising as a result
of Minnesota Logos' construction, operation and/or maintenance of
the various logo sign panels, whether or not such action or claim
alleges negligence of Mn/DOT or the State, its agents or
employees in supervision or approval of Minnesota Logos'
activities, or failure to discover and/or prevent Minnesota
Logos' negligence.
12.02 MINNESOTA LOGOS' RESPONSIBILITIES FOR EMPLOYEES
Any and all employees of Minnesota Logos and all other persons
employed by Minnesota Logos in the construction, operation and/or
maintenance of the Franchise Program or in the performance of any
of its duties and responsibilities under this agreement shall not
be considered employees of Mn/DOT, and that any and all claims
that may or might arise under the Worker's Compensation Act of
the State of Minnesota on behalf of said employees while so
engaged and any and all claims made by any third party as a
consequence of any act or admission on the part of Minnesota
Logos' employees while so engaged in the construction, operation
and/or maintenance of the program shall in no way be the
obligation or
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Mn/DOT Agreement No. 73526
responsibility of Mn/DOT or the State.
12.03 MN/DOT'S RESPONSIBILITIES FOR EMPLOYEES
Any and all employees of Mn/DOT and all other persons employed by
Mn/DOT in the performance of Mn/DOT's responsibilities under this
agreement shall not be considered employees of Minnesota Logos,
and that any and all claims, that may or might arise under the
Workers' Compensation Act of the State of Minnesota on behalf of
said Mn/DOT employees while so engaged and acting within the
scope of their employment shall in no way be the obligation or
responsibility of Minnesota Logos.
12.04 INSURANCE
Minnesota Logos, at its own expense, shall carry and keep in
force during the full term of this agreement a policy or policies
of insurance in the amounts and types as follows:
a) Commercial general liability insurance including
contractual liability in an amount not less than $1
million for injury to or death of any one person
per occurrence and an annual aggregate of not less
than $2 million.
b) Worker's compensation insurance in a form and
amount as required by state law.
The policy or policies shall cover the construction, operation
and maintenance of the Program. Minnesota Logos shall furnish
Mn/DOT's authorized agent with certificates of insurance as
evidence of coverage and shall not modify or cancel such coverage
without proper written notice to Mn/DOT. Failure of the firm to
procure and maintain the insurance as set forth above shall be
considered a default and cause for termination under paragraph
7.01. Further, at least fifteen (15) days prior to the date or
dates of expiring policies, certified copies of renewal, or new
policies, or other acceptable evidence of insurance shall be
deposited with Mn/DOT.
13.0 SURETY BOND
Minnesota Logos shall obtain initial payment and performance bonds each
in the amount of $1 million for the remaining months of calendar year
1995 to ensure that it will meet the duties and obligations of this
agreement. Thereafter, Minnesota Logos shall obtain annual payment and
performance bonds in the amounts specified for the following calendar
years:
1996 - $1,000,000
1997 - 900,000
1998 - 800,000
1999 - 700,000
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Mn/DOT Agreement No. 73526
2000 - 600,000
2001-2005 - 500,000
The bonds shall cover all actions required of Minnesota Logos to satisfy
the terms of this agreement and to guarantee payment of its obligations
in connection herein. The bond shall be conditioned upon the faithful
completion of this agreement and the payment of all indebtedness
incurred for all labor, materials and supplies. Minnesota Logos shall
furnish Mn/DOT with evidence of the initial and any subsequent bonds and
shall not modify or cancel such bonds without Mn/DOT approval.
The payment and performance bonds shall be issued for an initial term
ending December 31, 1995, and subject to annual renewal thereafter at
the option of the surety. If the surety elects not to renew the bonds
at the end of the initial term or any subsequent term, the surety
company shall provide Mn/DOT and Minnesota Logos with at least sixty
(60) days written notice of its decision not to renew the bonds, and
Minnesota Logos shall provide substitute payment and performance bonds
meeting the requirements of this agreement. The surety will not be held
liable for any of the remaining years of the agreement should Minnesota
Logos be unable to secure subsequent bonding. If Minnesota Logos cannot
secure subsequent bonding at the time the surety company opts not to
renew any bond, such action will not cause a claim under the bonds in
force. Payment and performance bonds must be in place for the term of
this agreement as specified herein. Failure to obtain or maintain the
required bonds shall be considered default under paragraph 7.01.
The bonds shall cover, but are not limited to, the following potential
losses:
LOSSES TO THE STATE
a) Costs incurred by the State to continue Minnesota Logos' duties
and obligations under the Program in the event of default by
Minnesota Logos pursuant to paragraph 7.01;
b) Reletting of the agreement in the event of default by Minnesota
Logos;
c) Restoration of Mn/DOT right-of-way in the event of default by
Minnesota Logos; or in the event that Minnesota Logos abandons
the logo signs at the expiration of this agreement;
d) Maintenance of structures, logo sign panels and business panels
in the event of default by Minnesota Logos;
e) Removal or reinstallation of structures, logo sign panels and
business panels where needed in the event of default by Minnesota
Logos;
f) Continue fulfilling the terms of the business leases in the event
of default by Minnesota Logos;
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Mn/DOT Agreement No. 73526
LOSSES TO CREDITORS
Payment for any sign structures or panels where there are liens or legal
proceedings threatening their removal.
LOSSES TO EMPLOYEES OF MINNESOTA LOGOS
Payment for any claims brought by employees in the event of default by
Minnesota Logos.
LOSSES TO ADVERTISERS
Payment of unexpired leases to businesses under paragraph 8.02.
14.0 PERMITS, LICENSES AND TAXES
Minnesota Logos shall procure all applicable permits and licenses; pay
all charges, fees, and taxes; and give all notices necessary and
incidental to the due and lawful prosecution of the work. When
requested, Minnesota Logos shall furnish Mn/DOT with evidence indicating
that it has complied with permit, license and tax requirements.
15.0 APPROVALS
Before this agreement becomes binding and effective, it shall be
executed and approved by Minnesota Logos, Mn/DOT and such state officers
as the law may provide.
16.0 SUPPLEMENTAL AGREEMENT AND REMEDIES
Minnesota Logos and Mn/DOT may exercise those legal remedies as may be
available to them in connection with any dispute arising out of this
agreement which cannot be settled by the parties hereto by supplemental
agreement. Any modifications or amendments to this agreement shall be
in writing and shall be executed and approved by the same parties and
state officers who executed the original agreement, or by their
successors in office.
17.0 EXHIBITS
The following exhibits are attached hereto and incorporated into this
agreement:
Exhibit 1 List of Eligible Routes and Maps
Exhibit 2 Minnesota Manual on Uniform Traffic Control Devices (MN
MUTCD), Part II-G
Exhibit 3 Standards for Logo Signs
Exhibit 4 Sign Design
Exhibit 5 Replacement and Refurbishment of Logo Signs
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Mn/DOT Agreement No. 73526
IN WITNESS WHERE OF, the parties have caused this agreement to be duly
executed by the proper representatives and officials, intending to be bound
thereby.
MINNESOTA LOGOS, A MINNESOTA PARTNERSHIP
MINNESOTA DEPARTMENT OF
By: Xxxxx Xxxxxx, Jr. TRANSPORTATION
-----------------------------------
MINNESOTA LOGOS, INC.
By: Xxxxx Xxxxxx
---------------------------------
Title: Director
--------------------------------
Title: Deputy Commissioner
------------------------------
Date: 5/5/95
---------------------------------
Date: 5/8/95
-------------------------------
By: Xxxxxxx Xxxxx
-----------------------------------
MINNESOTA LOGOS, INC. Approved as to form and execution by
the Office of the Attorney General
Title: Secretary
--------------------------------
By: Xxx X. Xxxxxxx
---------------------------------
Date: 5/5/95 Assistant Attorney General
---------------------------------
Date: 5/9/95
-------------------------------
By: Xxxx Xxxxxxx
-----------------------------------
GLOBAL SPECIALITY CONTRACTORS, INC.
COMMISSIONER OF ADMINISTRATION
Title: President
--------------------------------
By: Xxxxxx Xxxxx
---------------------------------
Date: 5/4/95
---------------------------------
Date: 5/9/95
-------------------------------
By: Xxxxxxx Xxxxxxx
-----------------------------------
GLOBAL SPECIALITY CONTRACTORS, INC.
COMMISSIONER OF FINANCE
Title: Secretary
--------------------------------
By: Xxxxx Xxxxxxxx
---------------------------------
Date: 5/4/95
---------------------------------
Date: 5/9/95
-------------------------------
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