SECOND AMENDMENT TO LEASE
THIS SECOND AMENDMENT TO LEASE is made and entered into effective as of the 2nd
day of December, 1998, between CSM CORPORATION, a Minnesota corporation,
("Landlord") and DYNAMARK, INC., a Minnesota corporation, ("Tenant").
RECITALS
First: The Landlord and Tenant entered into a lease dated March 11, 1997,
covering certain premises located at 0000 Xxxxxxxxx Xxxxxx Xxxxx,
Xxxxx Xxxxx, Xxxxxxxxx (the "Lease").
Second: The parties have executed a First Amendment to Lease, dated
September 24, 1997, extending the term of the Lease and
documenting increased construction costs payable by Tenant under
the Lease.
Third: The parties wish to execute this Second Amendment to Lease to
confirm their agreement to certain matters related thereto:
AGREEMENT
In consideration of the above stated premises and the mutual covenants
hereinafter contained, the parties hereby agree that the Lease is modified,
amended, and/or supplemented as follows:
1. Premises. The Premises and certain improvements thereupon shall be and
are hereby modified as shown on the site plan attached hereto as
REVISED EXHIBIT A. REVISED EXHIBIT A replaces and his hereby
substituted for Exhibit A attached to the First Amendment to Lease.
Tenant acknowledges that the Premises are a part of a development which
will include four buildings and associated appurtenant improvements,
all as shown on REVISED EXHIBIT A. Tenant acknowledges and agrees that
the Premises will be subject to and benefitted by various non-exclusive
easements for ingress, egress and access over the private drives
serving the Project, and certain exclusive easements for utilities and
other purposes, provided that the same shall not interfere with the use
and enjoyment of the Premises, as contemplated herein.
2. Lease Term. Landlord and Tenant are parties to a lease agreement dated
December 2, 1998 (the "New Lease"), covering certain premises and a new
building to be constructed thereon located adjacent to the Premises,
all as shown on REVISED EXHIBIT A. The parties agree that the term of
the Lease shall be adjusted such that the term of the Lease shall be
coterminous with the term of the New Lease. More particularly, upon the
commencement date of the New Lease, the term of the Lease shall be
extended and shall run for a period of one hundred fifty-six (156)
months commencing on the commencement date of the New Lease. If the
commencement date of the New Lease is other than the first day of a
calendar month, then the term of the Lease shall continue in full force
and effect for a period of one hundred fifty-six (156) months from and
after the first day of the month next succeeding the commencement date
of the New Lease. When the commencement date of the New Lease has been
established, the parties shall execute an addendum to this Second
Amendment to Lease, confirming the term and expiration date of the
Lease.
3. Subsection 1.5 of the Lease is hereby deleted in its entirety and
replaced with the following:
1 Exhibit 10.23
"Base Rent. The Base Rental for the Premises during the remaining term
of this Lease shall be as follows:
Monthly Per
Period Base Rent Square Foot
------ --------- -----------
11/1/98 - 07/31/02 $24,062.50 $8.75
08/01/02 - 12/31/06 $25,437.50 $9.25
01/01/07 - New Lease expiration date $26,812.50 $9.75
Option Term:
------------
60 months following the
New Lease expiration date market market
Landlord and Tenant agree that the as built area of the Premises is
33,000 square feet."
4. Remodeling Allowance. Landlord agrees to provide Tenant with a one time
allowance for remodeling the Premises. Landlord's maximum contribution
towards the costs of remodeling will be based upon the time that such
remodeling occurs, in accordance with the following schedule:
Period of Maximum Allowance
Remodeling Expenditure Amount Per Square Foot
---------------------- ----------------------
1/1/01 - 12/31/02 $3.00
1/1/03 - 12/31/04 $3.75
1/1/05 - 12/31/06 $4.50
1/1/07 - 12/31/08 $5.25
The allowance shall apply towards Tenant's actual remodeling costs and
shall be payable to Tenant upon completion of remodeling and receipt by
Landlord of evidence of payment under normal and customary construction
lending procedures. Landlord shall not be required to provide any
allowance on costs submitted for reimbursement after December 31, 2010.
5. Guaranty. Landlord has required, as a condition to its execution of
this Second Amendment to Lease, that Fair, Xxxxx and Company,
Incorporated unconditionally guarantee the full performance of Tenant's
obligations under the Lease, as amended. Tenant agrees to deliver such
guaranty, in the form of EXHIBIT E attached hereto and incorporated
herein by reference, within ten (10) days following the full execution
of this Second Amendment to Lease by Landlord and Tenant. In the event
Tenant fails to deliver such guaranty, Landlord may, at its option,
terminate this Second Amendment to Lease upon five (5) days written
notice to Tenant.
6. Section 1.4(B) of the Lease is deleted in its entirety and is replaced
with the following:
"Option to Extend. Subject to the terms and conditions hereinafter set
forth, Tenant shall have the option to extend the term of this Lease
for one (1) additional sixty (60) month term ("Option Term") upon and
pursuant to the same conditions contained herein. This option may be
exercised by written notice of exercise from Tenant to Landlord given
not less than one (1) year prior to the expiration of the Lease Term.
Tenant may exercise this option only if: (i) no condition of default
exists with respect to Tenant's performance of its obligations under
the Lease; and (ii) Tenant simultaneously exercises its options to
extend under the New Lease and under the Existing Lease covering the
premises located at 0000 Xxxxxxxxx Xxxxxx Xxxxx xx Xxxxx Xxxxx,
Xxxxxxxxx (as defined in Section 14.12 of the New Lease). Base Rent for
the Option Term shall be at the fair market rate for comparable space
in the north suburban geographic area. The fair market rent shall be
agreed upon by Tenant and Landlord within sixty (60) days of Tenant's
notice to Landlord of its irrevocable intent to exercise its option to
extend set forth herein. The fair market rental rate shall be
determined in accordance with the definition set forth in Section 7 of
the
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Existing Lease dated May 1, 1995 and amended December 30, 1996 for the
premises located at 0000 Xxxxxxxxx Xxxxxx North in Arden Hills,
Minnesota. In the event that Landlord and Tenant fail to agree to the
fair market rental rate in the time period set forth herein, then the
fair market rent shall be established in accordance with the
arbitration procedures set forth in section 8 of the Existing Lease for
the premises located at 0000 Xxxxxxxxx Xxxxxx North in Arden Hills,
Minnesota. If Tenant fails to exercise this option as aforesaid, this
option shall be null and void and of no further force and effect."
7. Miscellaneous. Except as expressly stated herein, the Lease shall
remain unchanged and in full force and effect.
IN WITNESS WHEREOF, the parties hereto have caused this Second Amendment to
Lease to be executed the day and year first above written.
LANDLORD: TENANT:
CSM CORPORATION DYNAMARK, INC.
BY: _______________________________ BY: _______________________________
ITS: _______________________________ ITS: _______________________________
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