EXHIBIT 10.1
AMENDMENT NO. 3
This Amendment No. 3 is entered into this 23rd day of November, 2004,
between Airport One Limited Partnership, a Minnesota limited partnership
("Landlord") and Navarre Corporation, a Minnesota corporation ("Tenant").
W I T N E S S E T H:
In consideration of One Dollar ($1.00) and other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
parties hereby amend that certain Standard Commercial Lease dated March 30,
2000, as amended by that certain Amendment No. 1 dated April 1, 2002, and
further amended by that certain Amendment No. 2 dated March 10, 2004, between
Landlord and Tenant (collectively the "Lease"), as follows:
1. PREMISES. Section 1.2 is amended effective as of January 1, 2005 to add
to the Premises approximately 39,839 square feet of space (the "Additional
Space") within the Building, such that the Premises shall consist of 75,526
square feet of warehouse and 4,313 square feet of office for a total of 79,839
square feet. Exhibit A to the Lease shall be deleted effective as of January 1,
2005 and replaced with Exhibit A hereto.
2. TERM. The text of Section 1.3 is deleted effective as of January 1,
2005, and the following shall be inserted in its place and stead: Subject to and
upon the conditions set forth herein, the Term of the Lease shall be for a
period of six (6) years commencing January 1, 2005 and terminating December 31,
2010. Tenant shall have three (3) options to renew the Lease for consecutive
terms of five (5) years each. Tenant shall provide Landlord with no less than
one hundred eighty (180) days' prior written notice of its intent to exercise
this renewal option. Tenant's failure to timely exercise a renewal option shall
be deemed Tenant's waiver of its right to exercise such renewal option and any
remaining renewal options.
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3. BASE RENT. Section 1.4 is amended effective as of January 1, 2005 as
follows:
BASE RENT: $29,803.83 monthly ($357,646.00 annually) year one and
increasing annually at a rate of increase equal to the lesser of (i) two percent
(2%), or (ii) the annual increase in the Consumer Price Index for Urban Wage
Earners and Clerical Workers (CPI-W) (1982-84: 100) (the "CPI Index") over the
prior year; provided, however, if the CPI Index is not published or available,
then Landlord shall have the discretion to substitute the CPI Index with a
substantially similar index.
4. RIGHT OF FIRST REFUSAL. The right of first refusal set forth in the
Lease (specifically paragraph 2 of that certain Amendment No. 2 dated March 10,
2004 between Landlord and Tenant) is hereby deleted, and the following is
inserted in its place and stead: In the event that Landlord intends during the
term of this Lease to offer for lease all or any portion of the remaining 40,000
square feet in the Building, (the "Expansion Space"), Landlord shall give
written notice thereof to Tenant (the "Offer Notice"), including in such notice
the terms and rental under which Landlord desires to offer the Expansion Space
for lease, Tenant shall have ten (10) days after receipt of the Offer Notice to
exercise its right and option to lease the portion of the Expansion Space
specified in the Offer Notice on the terms and conditions set forth by Landlord,
in which event Landlord and Tenant shall execute a lease agreement incorporating
such terms and conditions. If Tenant fails to exercise such right within each
ten (10) day period, Landlord shall have the right to offer and lease such
space, free and clear of Tenant's rights as set forth above; provided, if the
space identified in the Offer Notice is not leased within one (1) year following
the Offer Notice, a subsequent Offer Notice shall be given and Tenant shall
again have ten (10) days to exercise its option therein in the same manner as
set forth above. Notwithstanding anything herein to the contrary, Tenant's
rights under this paragraph shall be (i)
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subject to the rights of any tenants for such space to expand or renew their
leases and (ii) conditioned upon there being no Default by Tenant under this
Lease at the time the Offer Notice would otherwise be required to be given or at
the time of exercise of Tenant's right.
5. PRO RATA SHARE. Effective as of January 1, 2005, the Pro Rata Share set
forth in Section 1.8 of the Lease of thirty-three percent (33%) shall be deleted
and replaced by sixty-seven percent (67%).
6. SIGNS. Section 3.2 of the Lease shall be deleted and of no further
force and effect whatsoever from and after the date, if any, on which Tenant
leases the Expansion Space in addition to the Premises.
7. RIGHT OF ACCESS. Section 3.5 of the Lease is amended by inserting the
phrase "upon reasonable prior notice" after the phrase "at any and all
reasonable times" in the first line of such Section 3.5.
8. THEFT OR BURGLARY. Section 4.2 of the Lease is hereby amended by
inserting the phrase ", except to the extent attributable solely to the
negligence or willful misconduct of the Landlord, its employees, agents or
representatives" after the word "Building" at the end of such Section 4.2.
9. HOLD HARMLESS. Section 7.5 of the Lease is hereby amended by inserting
the phrase "Except to the extent solely attributable to the negligence or
willful misconduct of the Landlord, its employees, representatives or agents,"
at the beginning of such Section 7.5 before the word "Landlord".
10. CONDITIONS OF ASSIGNMENT. Section 9.3 of the Lease is here by amended
by inserting a period in the 20th line of said Section after the word "sublease"
and deleting the
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phrase "and Landlord shall have a security interest in all properties on the
Premises to secure payment of such sums" from the 20th and 21st lines.
11. CORPORATE AUTHORITY. Section 14.7 of the Lease is hereby amended by
deleting the last sentence of said Section in its entirety.
12. REMOVAL OF DEMISING WALL; DELIVERY OF THE ADDITIONAL SPACE. Landlord
agrees to deliver the Additional Space to Tenant on or before January 1, 2005.
In addition, Landlord agrees, at its sole cost and expense and in a
commercially-reasonable manner so as to minimize disruption to Tenant's use of
the existing Premises, to remove the demising wall that currently divides the
existing Premises from the Additional Space ("Landlord's Work"). Landlord shall
commence Landlord's Work reasonably promptly following the date on which the
Additional Premises are vacated by the existing tenant. If Landlord fails to (i)
complete Landlord's Work, and/or (ii) deliver the Additional Space to Tenant on
or before January 1, 2005, then Landlord shall provide Tenant with a credit
equal to two (2) days' Base Rent with respect to the Additional Space for each
day beyond January 1, 2005 that Landlord's Work is not completed and/or delivery
of the Additional Space has not occurred. In addition, if, within ninety (90)
days following January 1, 2005, either (i) Landlord's Work is not completed, or
(ii) the Additional Space has not been delivered, then Tenant shall be entitled
to terminate the Lease with respect to the Additional Space. Notwithstanding
anything to the contrary in this Amendment No. 3, Tenant's obligations under
this Amendment No. 3, including, without limitation, Tenant's obligation to pay
Base Rent with respect to the Additional Space, shall not be effective until
Landlord has completed Landlord's Work and delivered the Additional Space to
Tenant.
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13. Except as set forth above, the terms and conditions of the Lease shall
continue, and the parties hereto reaffirm and acknowledge the terms and
conditions of the Lease.
[SIGNATURES ON NEXT PAGE.]
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LANDLORD TENANT
AIRPORT ONE LIMITED PARTNERSHIP NAVARRE CORPORATION
By: _______________________________ By: ____________________________
Its: General Partner Its: _______________
Date _____________________________ Date: ______________________________
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EXHIBIT A
PLAN OF DEMISED PREMISES
[See attached.]
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