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AMENDED AND RESTATED LEASE AGREEMENT
THIS AMENDED AND RESTATED LEASE AGREEMENT, made and entered
into on this 12th day of December, 1996, by and between Xxxxxx X. Xxxxxx, Xx.,
(hereinafter referred to as "Landlord") and Service One International
Corporation, a Delaware corporation, having its principal place of business in
Sioux Falls, South Dakota, (hereinafter collectively referred to as "Tenant").
WHEREAS, Landlord and Tenant have entered into a Net Lease Agreement on
September 23, 1996; and
WHEREAS, the Landlord and Tenant now hereby agree to amend such Lease
Agreement by entering into this Amended and Restated Lease Agreement dated this
12th day of December, 1996.
ARTICLE 1.
LEASED PREMISES
a. Description of Premises. Landlord hereby leases and demises to Tenant
and Tenant hereby accepts and leases from Landlord, on the terms and
conditions hereinafter set forth, that certain real property and
building, fixtures, and other related improvements located in Minnehaha
County, South Dakota, on land which is more particularly described as
follows:
Lot A, Tract 1, Tickman Addition to Sioux Falls, Minnehaha
County, South Dakota,
also known as 0000 Xxxxx Xxxxxx Xxxxxx, Xxxxx Xxxxx, Xxxxx
Xxxxxx.
and hereinafter in this Lease called the "Premises". The Premises
consist of an area of approximately 149,410 square feet with an
existing building located thereon of approximately 15,200 square feet
("Initial Building"). As set out in paragraph 1(c), Landlord shall
construct an additional building on the Premises consisting of a
building of 15,000 square feet ("Additional Building").
b. Quiet Enjoyment. Landlord covenants and agrees that so long as Tenant
is not in default under the terms of this Lease, Tenant shall have
quiet and peaceful possession of the Premises and shall enjoy all of
the rights granted without interference.
c. Construction of Additional Building. Landlord shall erect on the
Premises a 15,000 square foot building ("Additional Building") except
such portions thereof as Tenant is to furnish as hereinafter set out.
The Additional Building shall be built in accordance with plans and
specifications (the "Plans and Specifications") as agreed to by the
parties hereto. The Plans and Specifications are hereby incorporated
herein by reference as Exhibit A. Landlord's completion of its portion
of the construction of the Additional Building shall
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be on or before the date set forth in the Plans and Specifications and
such construction shall be done in a good and workmanlike manner in
full compliance with the building laws and ordinances applicable
thereto, in order to receive a certificate of occupancy, and in
compliance with all other governmental laws, or ordinances, regulations
and requirements. Any delay in the completion of the Additional
Building thereof shall defer the payment obligation for the Additional
Building as set forth in paragraph 3.(a) Tenant shall furnish and
install the equipment, machinery, and furnishings at its own expense
and in accordance with the Plans and Specifications. Such equipment,
machinery, and furnishings shall be furnished and installed by Tenant
as soon as can reasonably be done after the Additional Building has
been completed by Landlord. All Tenant's work shall be done in a good
and workmanlike manner and in accordance with all city building codes.
Landlord is under no obligation to make any structural or other
alterations, decoration, additions or improvements in or to the
Premises except as expressly set forth in the Plans and Specifications.
Tenant shall have the right to make changes from time to time in the
Plans and Specifications by submitting to Landlord revised plans and
specifications (herein called the "Revisions"). Upon timely receipt of
any Revisions, Landlord shall submit the Revisions for Performance to
the contractors performing the trade or trades involved in the
Revisions, and if so requested by Tenant, obtain proposed Bids from
those contractors before embarking on such performance. The cost of any
Revisions shall be included in the Base Rent as agreed to by the
Landlord and Tenant. Landlord shall have the right to reject any
Revisions which would delay the Additional Building Rent Commencement
Date of this Lease unless, in conjunction therewith, Tenant agrees to
pay rental for the Additional Building of the date the Additional
Building Rent Commencement Date would have occurred but for the
completion of the Revisions.
d. Preparation of Premises. Tenant shall take and accept the Premises,
including the Initial Building in its "as is" condition. "As is" shall
mean in tenantable condition so that the lights, front and rear doors,
HVAC, plumbing and water heater are in working or operating condition.
Taking of possession of the Initial Building by Tenant shall be
conclusive evidence that the Initial Building, was, on that date, in
good, clean and tenantable condition as represented by Landlord. Tenant
acknowledges that, except as provided herein, no representations as to
the repair of the Premises or Initial Building or promises to alter,
remodel or improve the Premises or Initial Building have been made by
Landlord.
e. Signs. Tenant shall be allowed to install exterior signage, containing
Tenant's name and logo on the exterior of the Premises as well as a
free standing exterior sign at the entrance to the Premises, such
signage not to exceed the Premises allowable signage per code or
ordinance. All exterior signage shall comply with local codes and
ordinances and be approved by Landlord, which approval shall not be
unreasonably withheld or delayed. It is understood that Tenant will pay
for the signage and that Landlord, if requested, will use its best
effort to assist Tenant in securing required approvals, provided Tenant
will promptly reimburse Landlord for any monies expended for this
purpose.
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ARTICLE 2.
TERM
The Initial term of this Lease shall be for a period of Fifteen (15) years
commencing on September 23, 1996 ("Commencement Date") and ending September 30,
2011.
ARTICLE 3.
RENT
a. Base Rent. Until such time as the Additional Building is completed and
delivered to the Tenant, Tenant covenants and agrees to pay to
Landlord, Base Rent of $11,875.00 per month for the Premises, including
the Initial Building. If the Lease Commencement Date is not on the
first of the month, the Base Rent for the first month shall be
prorated. At the time of the completion of the Additional Building
("Completion Date"), Tenant covenants and agrees to pay to Landlord, at
Landlord's address specified herein or at such place as may be
designated by Landlord from time to time without any prior demand
therefor, and without any deduction or offset whatsoever, an annual
Base Rent of $285,000 from the Completion Date to September 30, 2006,
of which Tenant shall pay to Landlord, monthly, in advance on the first
day of each and every month an amount equal to Twenty Three Thousand
Seven Hundred Fifty and no/100ths ($23,750.00). If the completion of
the Additional Premises is not completed on the first of the month, the
first month's Base Rent subsequent to the Completion Date shall be
prorated.
For the purposes of this Lease, the Completion Date shall be defined as
such date three weeks from the date the Landlord has completed all of
the work required by Landlord as set out in the Plans and
Specifications which will allow a temporary certificate of occupancy to
be issued by the city upon completion of Tenant's work under the Plans
and Specifications, and the Additional Building has been delivered to
the Tenant, or the date Tenant commences operation in the Additional
Building, whichever occurs first.
b. Base Rent Adjustment. Beginning October 1, 2006, and continuing until
September 30, 2011, the annual Base Rent as set forth in paragraph 3a
will be increased to $327,750, in which Tenant shall pay to Landlord,
monthly, in advance on the first day of each and every month an amount
equal to twenty-seven thousand three hundred twelve and 50/100th
($27,312.50).
c. Additional Rent. Except as otherwise herein provided, and nothing
herein shall require Tenant to make any payments for any liens or
encumbrances or mortgage encumbering the Premises, it is the intent of
Landlord and Tenant that the Base Rent set forth above shall be on a
triple net basis, as that term is used and understood in connection
with the leasing of real property. Accordingly, as additional rental
hereunder, Tenant shall pay, directly to the appropriate authorities,
during the term of this Lease, subject to proration to the date of
commencement and termination of the term hereof, all taxes,
installments of special assessments, gross receipts taxes and taxes on
rentals (other than income taxes)
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relating to the Premises; the costs of heating, cooling, utilities;
insurance (including but not limited to liability insurance and fire
and casualty insurance with rental abatement endorsement, boiler and
pressure vessel insurance; and owners protective liability insurance),
security, snow removal, landscaping, janitorial and cleaning services;
fees for professional services; charges under maintenance and service
contracts; all supplies purchased for use in the Premises; maintenance
and repair costs as hereinafter set forth; any equipment rental,
altering, maintaining and repairing the Premises, and any other
expenses or charges of any kind, general or special, foreseen or
unforeseen, of any nature whatsoever, which during the term of this
Lease shall be levied, assessed or imposed by any governmental
authority upon or with respect to, or incurred in connection with, the
possession, occupation, operation, alteration, maintenance, repair and
use of the Premises, it being intended that this Lease shall result in
a rental to be paid to Landlord without additional cost to Landlord or
diminution or offset thereto in the monthly base amount specified in
Article 3(a) above.
ARTICLE 4.
TAXES, ASSESSMENTS AND UTILITIES
a. Taxes and Assessments. Tenant covenants and agrees to pay and
discharge, directly to the appropriate Governmental authorities, as
additional rental hereunder, at least ten (10) days before delinquency
thereof and before any penalties or interest shall accrue thereof, all
taxes of any kind, general or special, foreseen or unforeseen, of any
nature whatsoever, and installments thereof which may be taxed,
charged, levied, assessed or imposed from and after the commencement of
the term hereof upon all or any portion of, or in relation to the
Premises, including the improvements at any time situated or erected
thereof, and all personal property and equipment at any time contained
therein.
b. Tenant's Right to Contest Validity. Landlord agrees that Tenant shall
have the right, in Tenant's or Landlord's name, but at Tenant's sole
cost and expense, to contest the validity of any tax or assessment by
appropriate proceedings, timely instituted, provided that (a) Tenant
gives Landlord written notice of Tenant's intention to do so at least
twenty (20) days prior to the delinquency thereof and (b) Tenant
diligently prosecutes any such contest, at all times effectively stays
or prevents any official or judicial sale of the Premises, under
execution or otherwise, pays any final judgment enforcing any tax or
assessment so contested, and promptly procures and records satisfaction
thereof. Landlord shall, if requested by Tenant, cooperate with Tenant
in any such proceedings; provided, however, that Landlord shall not be
liable for any expenses whatsoever in connection therewith, and Tenant
shall protect and indemnify Landlord against all loss, cost, expense,
attorney's fees or damages resulting therefrom.
c. Other Taxes. If at any time during the term of this Lease under the
laws of the United States, the State of South Dakota or any political
subdivision thereof in which the Premises are situated, a tax or excise
on rent or any other tax, however described, is
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levied or assessed by any political body against Landlord on account of
rentals payable to Landlord hereunder, such tax or excise shall
likewise be paid by Tenant.
d. Utilities. Tenant shall pay or cause to be paid all charges for water,
gas, sewer, electricity, light, heat, air conditioning, power,
telephone or other service of any kind whatsoever submitted, rendered
or supplied in connection with the Premises, and shall contract for the
same in Tenant's own name.
ARTICLE 5.
USE OF PREMISES
a. Restrictions on Use. The Premises are leased to Tenant for the purpose
of Tenant conducting its financial/credit card processing operations or
for any other lawful purpose. Tenant waives any and all rights to
terminate this Lease for any reason due to frustration of the intended
use or purposes thereof. Tenant shall not do anything in or about the
Premises which will in any way tend to increase insurance rates for the
Premises. Tenant agrees to pay as additional rent any increase in
premiums for insurance against loss by fire or extended coverage risks
resulting from the business carried on in the Premises by Tenant.
Tenant shall not suffer or permit any waste of the Premises during the
term of this Lease.
b. Hazardous Waste. Tenant shall not install, use, generate, store or
dispose of in or about the Premises any hazardous substance, toxic
chemical, pollutant or other material regulated by the Comprehensive
Environmental Response, Compensation and Liability Act of 1985 or in
any South Dakota statute, rule, or regulation or any similar law or
regulation (including without limitation any material containing
asbestos or PCB) without Landlord's written approval of each such
substance. Landlord shall not unreasonably withhold its approval of use
by Tenant of immaterial quantities of such substances customarily used
in its business operations, so long as Tenant uses such substances in
accordance with applicable laws. Tenant shall indemnify, defend and
hold Landlord harmless from and against any claim, damage or expense
arising out of Tenant's installation, use, generation, storage, or
disposal of any such substance, regardless of whether Landlord has
approved the activity.
Landlord represents that, prior to the Commencement Date, to the best
of its knowledge, there has been no installation, use, generation,
storage or disposal of in or about the Premises any hazardous
substance, toxic chemical, pollutant or other material regulated by the
Comprehensive Environmental Response, Compensation and Liability Act of
1985 or in any South Dakota statute, rule, or regulation or any similar
law or regulation (including without limitation any material containing
asbestos or PCB). Landlord shall indemnify, defend and hold Tenant
harmless from and against any claim, damage or expense arising out of
such prior installation, use, generation, storage, or disposal of any
such substance of which Landlord had knowledge.
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c. Subsequent to the completion of the Additional Premises, Landlord shall
provide a minimum of 181 parking spaces adjacent to the Premises as
shown on the site plan attached as Exhibit B.
ARTICLE 6.
MAINTENANCE, REPAIRS AND ALTERATIONS
a. Maintenance and Repairs. The Premises and every part thereof shall be,
at the Commencement Date, in good order, condition and repair. Landlord
at its cost shall be responsible for the repair and replacement of all
of the structural elements and exterior surfaces of the Premises
including roof, roof membrane and roof covering, walls, concrete slab,
footings, electrical and plumbing exterior to the building, heating,
ventilating and air conditioning system at Landlord's sole expense as
and when necessary. Tenant shall maintain the heating, ventilation and
air conditioning and maintain, repair and replace interior walls,
interior ceiling, painting, floor coverings, plate glass and doors at
Tenant's sole expense. Tenant shall, at its own cost and expense,
provide and maintain landscaping, if any, on the Premises. Tenant
agrees to keep and maintain the Premises and the fixtures and equipment
therein in first class, properly functioning, safe, orderly and
sanitary condition, will suffer no waste or injury thereto, and will at
the expiration or other termination of the Term of this Lease,
surrender the same with all improvements in the same order and
condition in which they were on the Commencement Date, or in such
better condition as they may hereafter be put, ordinary wear and tear
and casualty damage to the extent covered by insurance excepted. All
alterations, decorations, additions or improvements in or to the
Premises made by Tenant shall become the property of Landlord upon
expiration of the term and shall remain upon and be surrendered with
the Premises as a part thereof without disturbance or injury, unless
Landlord requires specific items thereof to be removed by Tenant at
Tenant's sole expense, in which event Tenant shall do so prior to the
expiration of the term at its expense, and shall repair any damage
caused thereby. Notwithstanding the foregoing, if Tenant is not in
default in the performance of any of its obligations under this Lease,
if any and all damage resulting therefrom be repaired, and Tenant shall
post such security with respect thereto as Landlord may reasonably
request, Tenant shall have the right to remove, during the last 90 days
of the term of this Lease, all movable furniture, equipment,
furnishings or trade fixtures installed in the Premises at the direct
expense of Tenant, provided the same is completed with no damage to the
Premises.
b. Alteration. Subject to the prior written consent of Landlord, which
shall not be unreasonably withheld, Tenant shall have the right to make
such additions, alterations, changes or improvements to the Premises as
Tenant shall deem necessary or desirable; provided, however, that no
such addition, alteration, change or improvement shall be made which
will weaken the structural strength of, lessen the value of, interfere
with or make inoperable, any portion of the Premises or appurtenances
thereto or change the architectural appearance of the Premises. All
additions, alterations, changes and improvements shall be made in a
workmanlike manner, in full compliance with all
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building laws and ordinances applicable thereto, and when permitted to
be made shall become a part of the Premises and shall be surrendered as
a part of the Premises upon the termination of this Lease.
c. Non-Liability of Landlord. Landlord shall not be obligated to maintain
nor to make any repairs or replacements of any kind, nature or
description whatsoever to the Premises, except as provided specifically
herein, and Tenant expressly waives all rights to make repairs at
Landlord's expense under any law now or hereinafter enacted.
d. Tenant Self-Help. If Landlord shall default in the performance or
observance of any agreement or condition in this Lease contained on its
part to be performed or observed, and if Landlord shall not cure such
default within ten (10) days after notice from Tenant specifying the
default (or, if said default is not reasonably capable of cure within
ten (10) days, shall not within said period commence to cure such
default and thereafter prosecute the curing of such default to
completion with due diligence), Tenant may at its option, without
waiving any claim for damages for breach of agreement, at any time
thereafter cure such default for the account of Landlord, and any
amount paid or any contractual liability incurred by Tenant in so doing
shall be deemed paid or incurred for the account of Landlord, and
Landlord agrees to reimburse Tenant therefor or save Tenant harmless
therefrom; provided that Tenant may cure any such default as aforesaid
prior to the expiration of said waiting period, but after said notice
to Landlord if the curing of such default prior to the expiration of
said waiting period, is reasonably necessary to protect the Premises or
Tenant's interest therein to prevent injury or damage to persons or
property, or to enable Tenant to conduct its business in the Premises.
If Landlord shall fail to reimburse Tenant upon demand for any amount
paid for the account of Landlord hereunder or for any other sum payable
to Tenant pursuant to this Lease, said amount plus interest thereon at
an annual rate of 2% in excess of the Prime Rate of Norwest Bank
Minneapolis N.A., but in no event greater than the maximum legal rate
of interest, from the date of demand upon Landlord for payment, may be
deducted by Tenant from the next or any succeeding payments of Base
Rent or any additional rent or other sum due hereunder. Notwithstanding
anything to the contrary contained in this Lease, in the case of
emergency, notices required pursuant to this Article may be given
orally, or in any other reasonably due and sufficient manner having
regard to the emergency and the attending circumstances. If any such
notice shall not be given in the manner described in Article 20 hereof,
then, as soon thereafter as may be practicable, such notice shall be
followed-up by notice given in the manner described in said Article.
The addresses provided in Article 20 for notices to a party may be
changed by the party receiving, such notice by written notice to the
other party.
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ARTICLE 7.
LANDLORD'S ACCESS TO PREMISES
a. Inspection of Premises by Landlord. Tenant agrees to permit Landlord
and the authorized representatives of Landlord to enter the Premises at
all reasonable times during usual business hours for the purposes of:
(a) inspecting same, (b) making such repairs or reconstruction to the
Premises permitted to be made by Landlord, and (c) performing any work
therein which may be necessary by reason of Tenant's default under the
terms of this Lease, (d) decorating, remodeling, repairing, altering,
or otherwise preparing the Premises for reoccupancy at any time after
Tenant abandons the Premises for a continuous period of thirty (30)
days, provided that Tenant shall not be considered to have abandoned
the Premises so long as the Premises are kept in clean and orderly
fashion and rent is paid in accordance with the terms hereof, and (e)
entering the Premises without notice for emergency purposes. For said
purposes, Landlord shall have the right to possess pass keys to the
Premises. Nothing herein contained shall imply any duty on the part of
Landlord to do any such work which, under the provisions of this Lease,
Tenant is required to perform, and the performance thereof by Landlord
shall not constitute waiver of Tenant's default in failing to perform
the same. Landlord may, during, the performance of any work on the
Premises, keep and store upon the parking area of or within the
Premises all necessary materials, tools and equipment. Landlord shall
not in any event be liable for any reasonable inconvenience, annoyance,
disturbance, loss of business or other damage sustained by Tenant
during the making of repairs or the performance of any work on the
Premises, or on account of bringing materials, supplies, and equipment
into or through the Premises during the course thereof. In the event
Landlord makes any repairs or maintenance which Tenant has failed to do
or perform, the cost thereof shall constitute additional rent and shall
be paid to Landlord with the next installment of the monthly Base Rent
due hereunder.
b. Right to Exhibit Premises. Landlord is hereby given the right during
usual business hours to enter the Premises and to exhibit the same for
the purpose of sale or mortgage, and during the last six (6) months of
the term of this Lease, or any extension thereof, to exhibit the same
to any prospective Tenant.
ARTICLE 8.
MECHANIC'S LIENS
Tenant shall not suffer or permit any mechanic's liens to be filed
against the Premises or any part thereof by reason of work, labor, services, or
materials supplied or claimed to have been supplied to Tenant or anyone holding
the Premises or any part thereof through or under Tenant. If any such mechanic's
liens shall at any time be filed against the Premises, Tenant shall cause the
same to be discharged of record within sixty (60) days after the date of filing
the same. If Tenant shall fail to discharge such mechanic's lien within such
period, then, in addition to any other right or remedy of Landlord, Landlord
may, but shall not be obligated to, discharge the same either by paying the
amount claimed to be due or by procuring the discharge of such lien
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by deposit in court or by giving security or in such other manner as is or may
be prescribed by law. Any amount paid by Landlord for any of the aforesaid
purposes, and all reasonable legal and other expenses of Landlord, including
reasonable attorneys' fees, in or about procuring the discharge of such lien,
with all necessary disbursements in connection therewith, with interest thereon
at the rate of eighteen percent (18%) per annum from the date of payment shall
be repaid by Tenant to Landlord on demand, and if not so paid shall become due
and payable by Tenant as additional rent with the next succeeding installment of
monthly base rent which shall become due after such demand. Nothing herein
contained shall imply any consent or agreement on the part of Landlord to
subject Landlord's estate to liability under any mechanic's lien law.
ARTICLE 9.
COMPLIANCE WITH LAWS
a. Generally. Tenant shall through the term, at Tenant's sole cost and
expense, promptly comply with all laws and ordinances, and the orders,
rules, regulations and requirements of all Federal, State and municipal
governments and appropriate departments, commissions, boards and
offices thereof, foreseen or unforeseen, existing or hereafter
constituted, ordinary as well as extraordinary, which may be applicable
to the Premises, or the use or manner of use of the Premises; provided,
however, that in any event any such law, ordinance, order, rule or
regulation requires structural repairs or alterations to the Premises,
such repairs or alterations shall be at the expense of Landlord as
provided in Article 6(a) herein. Tenant will likewise observe and
comply with the requirements of all policies of public liability, fire
and all other policies of insurance at any time in force with respect
to the building and improvements on the Premises and the personal
Property thereof.
b. License. Tenant shall obtain all appropriate licenses required from all
Federal, State, and municipal governments, if any, needed to operate
its business on the Premises and Tenant shall be responsible to
maintain such licenses, as long as the Lease is in effect.
c. Non-Compliance. Landlord agrees that if at any time or times any
governmental authorities or insurance rating bureaus having
jurisdiction shall complain that the Premises or the Buildings were not
constructed in compliance with any law, ordinance or regulation of any
governmental authority or insurance rating bureau having jurisdiction
and shall request compliance, then Landlord shall, upon receipt of
notice of such complaint, cause such repairs, alterations or other work
to be done so as to bring about the compliance requested. If by reason
of such failure of compliance or by reason of such repairs, alterations
or other work done by Landlord, Tenant shall be deprived of the use and
enjoyment of the whole or any part of the Premises, all base rent and
other sums payable hereunder shall xxxxx on a per diem basis in
proportion to said deprivation. If at any time during the term of this
Lease, any person claiming a prior right to Tenant or any governmental
authority shall cause an injunction to be entered against Tenant
restricting Tenants using or enjoying the Premises or any rights of
Tenant under this Lease, and if said injunction shall not be dismissed
within sixty (60) days after Tenant shall give
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Landlord notice thereof, then Tenant, without waiving any other rights
Tenant may have against Landlord on account thereof (including, without
limitation, the right to an abatement of all rent payable hereunder so
long as said injunction shall remain in effect), may terminate this
Lease by giving Landlord notice thereof.
ARTICLE 10.
INDEMNIFICATION OF LANDLORD
Tenant agrees to indemnify and hold harmless Landlord against and from
any and all claims by or on behalf of any person, arising from the conduct or
management of, or from any work or thing whatsoever done, in and on the Premises
and will further indemnify and save Landlord harmless against any and from any
and all claims arising during the term of this Lease from any condition of any
street, curb, or sidewalk adjoining the Premises, or of any vaults, passageways
or space therein or appurtenant thereto, or arising from any breach or default
on the part of Tenant in performance of any covenant or agreement on the part of
Tenant to be performed, pursuant to this Lease, or arising from any act or
negligence of Tenant or any other occupant of the Premises, or any part thereof,
or of its or their agents, contractors, servants, employees or licensees, or
arising from any accident, injury or damage whatsoever caused to any person or
property occurring during the term of this Lease in or about the Premises, or
upon or under the sidewalks and the land adjacent thereto, and from and against
all judgments, costs, expenses and liabilities incurred in or about any such
claim or action or proceeding brought therein except as such claims or
liabilities are the result of the negligence of the Landlord, and in case any
action or proceeding be brought against Landlord by reason of any such claim,
Tenant upon notice from Landlord covenants to resist or defend such action or
proceeding by counsel reasonably satisfactory to Landlord.
ARTICLE 11.
INSURANCE
a. Fire and Extended Coverage. Tenant shall, as additional rent, at its
sole cost and expense, keep the Premises, including all improvements,
personal property, fixtures and equipment on, in or appurtenant to the
Premises at the commencement of the term and thereafter erected thereon
or therein, including all alterations, rebuildings, replacements,
changes, additions and improvements, fully insured for replacement
value which the parties agree is $2,500,000.00 at the inception of this
Lease, for the benefit of Landlord and Tenant as their respective
interests may appear, against loss or damage by fire and those perils
included from time to time in the standard form of extended coverage
insurance endorsement. All such insurance shall be in amounts at all
times sufficient to prevent Landlord or Tenant from becoming a
co-insured under the terms of the applicable policy. These insurance
provisions shall in no way limit or modify any of the obligations of
Tenant under any provision of this Lease to restore the Premises. Such
insurance shall expressly provide that any losses thereunder shall be
adjusted with Landlord and Tenant pursuant to a standard clause,
without contribution, if obtainable, and Landlord and Tenant, as their
respective interests may appear, but the proceeds of such insurance
shall
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be used for the repair, replacement or restoration of the Premises, as
provided by Article 12.
b. Liability Insurance. Tenant shall also, at its sole cost and expense,
but for the benefit of Landlord and Tenant, maintain comprehensive
general liability insurance against claims for personal injury, death
or property damage occurring upon, in or about the Premises, which
insurance shall afford protection of not less than Three million five
hundred thousand dollars ($3,500,000) with respect to injury, or death
to a single person, of not less than Three million five hundred
thousand dollars ($3,500,000) with respect to injuries or death from
any one accident, and of not less than Two million five hundred
thousand dollars ($2,500,000) with respect to property damage.
c. General Requirements. All policies of insurance maintained by Tenant in
accordance with this Article 11 shall be subject to and governed by the
following:
i. All policies of insurance shall provide that any loss
shall be payable in the event that, and
notwithstanding, any act or omission of Tenant might
otherwise result in a forfeiture or reduction of said
insurance and shall contain a waiver of any right to
subrogation.
ii. All policies of insurance and the form thereof shall
be subject to approval in writing by Landlord. A
certificate of insurance shall be delivered to
Landlord at the commencement of the term and renewal
certificates policies shall be delivered to Landlord
not less than ten (10) days prior to the expiration
of any then current policy. Landlord shall be named
as an additional insured.
iii. It is the intention of the parties that Tenant shall
take out, maintain in force and at all times pay for
and deliver to Landlord all of the policies of
insurance hereinabove referred to at such times and
in such manner so that Landlord shall at all times
during the term be in possession of paid up policies
which are in full force and effect.
iv. Each such policy shall provide that it may not be
canceled, non-renewed, or materially modified as to
the interest of Landlord, except upon thirty (30)
days' prior written notice from the insurance company
to Landlord.
v. Tenant shall not violate or permit any occupant of
the Premises to violate any of the conditions or
provisions of any such policy.
vi. Tenant and Landlord shall cooperate in connection
with the collection of any insurance monies that may
be due in the event of loss, but at the sole expense
of Tenant, and Tenant shall execute and deliver to
Landlord such
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proof of loss and other instruments as may be
required for the purpose of obtaining the recovery of
any such insurance monies.
vii. The premiums of all transferable insurance policies
in force at the termination of the term shall be
apportioned as between Landlord and Tenant in such
manner that Landlord shall reimburse Tenant for that
portion of the aggregate premiums unearned on all
such policies in force at the expiration of the term.
d. Waiver of Claims and Subrogation. Notwithstanding any other provisions
in this Lease to the contrary, Landlord and Tenant hereby release one
another from any and all liability or responsibility (to the other or
anyone claiming through or under them by way of subrogation or
otherwise) for any loss or damage covered by property insurance or
coverable by a customary policy of the insurance required by Article
11(a) or Article 11(b) (whichever is applicable), even if such loss or
damage shall have been caused by the fault or negligence of the other
party, or anyone for whom such party may be responsible.
ARTICLE 12.
DESTRUCTION
a. Partial or Total Destruction. In the event that the Premises shall be
damaged during the initial term of this Lease or at any time during an
extended term of this Lease so that fifty (50%) percent of the usable
space of the Premises shall be rendered unusable, Landlord shall have
the option of terminating this Lease unless Tenant agrees to continue
to pay the rent set forth in the Lease and agrees to restore the
Premises with the insurance proceeds. Regardless of whether such damage
is due to the fault, negligence, act or omission of Tenant, its
employees, agents or servants, licensees or invitees, Tenant shall also
have the option of terminating this Lease if there are insurance
proceeds available for the benefit of the Landlord. Upon termination by
either party, Landlord shall retain the right to receive payments under
the business interruption insurance as provided for in Article 11
herein for the balance of the term of this Lease Agreement. In the
event of a total or partial destruction of the Premises or any portion
thereof during the term of this Lease by any cause or risk including
those covered by any policy of insurance referred to in Article 11
above, Tenant shall give to Landlord prompt notice thereof and Tenant,
as long as it continues to pay the rent set forth in the Lease, shall
notwithstanding the foregoing, have the option, at its sole cost and
expense, whether or not insurance proceeds shall be sufficient for that
purpose, and regardless of the amount of any such destruction, to
forthwith repair, replace and rebuild the same at least to the extent
of the value thereof existing immediately prior to such occurrence,
provided such repairs, replacement or rebuilding can be done in
accordance with then existing laws and regulations. All such repairs,
replacement or rebuilding shall be performed in a good and workmanlike
manner and in compliance with all then existing laws and regulations,
and Landlord shall in no event be called upon to repair, replace or
rebuild the Premises or any portion thereof.
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b. Notice to Landlord. At least ten (10) days before the commencement of
such repairs, replacement or rebuilding, Tenant shall notify Landlord
of its intention to commence the same.
c. Application of Insurance Proceeds. For the purpose of payment toward
the cost of such repairs, replacement or rebuilding from time to time
(but not more frequently than once in each month), Landlord shall make
available and pay all net sums received under insurance policies
covering such loss, as provided in Article 11 above either: (a) to the
parties whom Tenant may employ to repair, replace, or rebuild same as
such repairs, replacements, or rebuilding shall progress, or (b) to
Tenant if Tenant shall make or pay for such repairs, replacements, or
building. In either case, Landlord shall pay said insurance proceeds
periodically as work and materials are actually incorporated in the
Premises. If the net amount of such insurance proceeds shall be
insufficient for the purpose of effecting repairs, replacement or
rebuilding of all such damaged or destroyed improvements, Tenant shall
pay the additional sums required, and if the amount of such insurance
proceeds shall be in excess of the cost thereof, the excess shall be
paid to and be retained by Tenant. If the Lease is terminated by either
Landlord or Tenant, the insurance proceeds shall be subject to the
rights of the holder of any mortgage to which this Lease is or shall be
subject and subordinate.
d. Rights of Landlord. Upon receiving notification from Tenant, if the
work of repairing, replacing, or rebuilding such damaged or destroyed
building, improvements, furniture or equipment or construction of a new
building shall not be commenced within a reasonable time from the date
of any such loss, destruction or damage, or after commencement thereof
shall not be expeditiously proceeded with to completion and Tenant has
ceased paying rent under the terms of the Lease. Landlord shall have
the right to cancel and terminate this Lease by giving to Tenant not
less than thirty (30) days' notice of intention to do so.
ARTICLE 13.
CONDEMNATION
a. Condemnation Defined. The term "condemnation", as used in this Lease,
shall mean the exercise of the power of eminent domain by any person,
entity, body, agency or authority, or private purchase in lieu of
eminent domain, and the date of condemnation shall mean the day on
which the actual physical taking of possession pursuant to the exercise
of said power of eminent domain, or private purchase in lieu thereof,
occurs or the date of settlement or compromise of the claims of the
parties hereto during the pendency of this exercise of said power,
whichever occurs first, and property is deemed "condemned" on said
date.
b. Landlord's Right to Collect Proceeds. In the event the Premises or any
part thereof shall be taken in condemnation proceedings, Landlord shall
be entitled to collect the entire award made in any such proceedings
without deduction therefrom for any estate hereby
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vested in or owned by Tenant subject to Tenant's rights as hereinafter
set forth. Tenant agrees to execute any and all further documents that
may be required in order to facilitate collection by Landlord of any
and all such awards. Tenant and any person or entity, having an
interest in Tenant's share of the award, in cooperation with Landlord,
shall have the right to participate in any condemnation proceedings or
agreement as aforesaid for the purpose of protecting Tenant's interests
hereunder.
c. Total Taking. If at any time during the term of the Lease the whole or
substantially all of the Premises shall be so taken or condemned, this
Lease shall terminate and expire on the date upon which title shall
vest in the condemning authority, and the rent provided to be paid by
Tenant shall be apportioned and paid to such date. For the purposes of
this Section, "substantially all of the Premises" shall be deemed to
have been taken if the portion of the Premises not so taken, and taking
into consideration the amount of the net award available for such
purposes, cannot be so repaired or rebuilt as to constitute a complete,
rentable structure suitable for continuing the use to which Tenant was
putting the Premises prior to such taking and capable of producing a
proportionately fair and reasonable net annual income after payment of
all operating expenses thereof, the net rent, as the same may be
reduced as a result of such taking, additional rent and all other
charges payable hereunder, and after performance of all covenants,
agreements, terms and provisions herein and by laws provided to be
performed and paid by Tenant.
d. Distribution of Award. In the event of a taking, which shall result in
the termination of this Lease, the rights of Landlord and Tenant in any
award shall be as follows and in the following order of priority:
i. There shall first be paid to the holder of any
mortgage on the Premises (regardless of whether this
Lease is or shall be subject and subordinate to said
mortgage) the unpaid balance of principal and
interest due on such mortgage.
ii. Landlord shall then retain that part of the award
attributable to the land and improvements (reduced by
any payment to a mortgagee under (a) above), and
consequential and severance damages for the value of
Landlord's interest in the remaining term of this
Lease.
iii. Tenant shall be entitled to receive the balance of
the award, if any.
e. Partial Taking. In the event of a partial taking which shall not result
in the termination of this Lease, Landlord shall promptly proceed to
repair, rebuild or restore the remainder of any building on the
premises affected thereby to a complete and self-contained
architectural unit, for the purposes and uses to which Tenant was
putting the Premises before the taking. However, if the aforementioned
taking renders the Premises unsuitable for Tenant's use, Tenant may
terminate this Lease as of the date when Tenant is required to yield
possession.
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ARTICLE 14.
ASSIGNMENT AND SUBLETTING
a. Prohibition Against Assignment. Subject to 14.b. below, Tenant shall
not assign, hypothecate or pledge this Lease or sublet the whole of the
Premises either voluntarily or by operation of law without the prior
written consent of Landlord; and such consent shall not be unreasonably
withheld. Any such assignment or subletting not provided for below,
without Landlord's prior written consent shall be void and, at
Landlord's option, shall terminate this Lease. Any assignment or
transfer of this Lease shall not be effective unless the assignee or
transferee shall, at the time of such assignment or transfer, assume in
writing all the terms, covenants and conditions of this Lease
thereafter to be performed by the Tenant, and shall agree in writing to
be bound thereby. Tenant specifically understands and agrees that any
assignment or sublease shall in no way release (unless by written
agreement with Landlord) the Tenant from any of its obligations and
covenants under this Lease, nor should said assignment or sublease be
construed or taken as a waiver of any of Landlord's rights or remedies
hereunder against or as relating to Tenant. In order for Landlord to
consider an assignment or sublease, Tenant shall provide the following:
i. Tenant shall give Landlord a twenty (20) day prior
written notice of its desire to assign or sublet,
which notice shall include reliable information,
including but not limited to, the name of the
proposed assignee or sublessee, its financial
responsibility evidenced by financial statements
and/or credit reports, a description of its business
activities and specific terms as to the assignment or
sublease agreement including rental, term and the
date said assignment or sublease is to take effect.
Tenant shall comply with all reasonable requests of
Landlord for additional information.
ii. Provided Landlord submits a preliminary approval of
such assignment or sublet, such consent shall be
conditioned upon the delivery to the Landlord within
ten (10) days after such preliminary approval of two
executed copies of the assignment which shall include
an assumption by the assignee, from and after the
effective date of the assignment of the performance
and observance of the covenants and conditions of
this Lease contained on Tenant's part to be performed
and observed, or should a sublease be involved, two
executed copies of the sublease agreement which shall
include an agreement on the part of the subtenant to
be obligated, from and after the effective date of
the sublease, to the performance and observance of
the covenants and conditions of this Lease contained
on Tenant's part to be performed and. observed.
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b. Permitted Assignments.
i. The provisions of this Articles shall not be deemed
to prohibit (1) transfers of stock among existing
stockholders or among spouses, children or
grandchildren of existing stockholders or inter vivos
or testamentary transfers to trusts established for
the benefit of such persons, (2) a public offering of
the stock of Tenant, (3) the transfer of outstanding
stock which are traded on a recognized securities
exchange or (4) a transfer of all of Tenant's stock
to any one person or entity.
ii. Tenant may assign this lease or sublease the entire
demised premises to a parent, affiliate or wholly
owned subsidiary of Tenant or to any entity with
which or into which Tenant may consolidate or merge
or to whom all or substantially all of the assets of
Tenant are sold or transferred.
c. Landlord Assignment. Landlord may assign his interest in this Net Lease
Agreement without the consent of the Tenant.
ARTICLE 15.
SECURITY INTEREST
Purchase Money Security Interest. Landlord's lien and security interest
is and shall remain subject and subordinate to any lien securing bona
fide purchase money financing of any of the property in question in
favor of a party unaffiliated with Tenant. Landlord shall not have any
lien for performance of any obligations of Tenant upon any fixtures,
machinery or equipment, or goods, wares or merchandise or other
personal property, and Landlord hereby expressly waives the provisions
of any law giving to it such a lien. Landlord agrees that if any lender
to which Tenant shall grant a security interest in the aforesaid
fixtures, machinery, equipment, goods, wares, merchandise and/or other
personal property shall request that Landlord confirm that it has
waived any lien which Landlord may have thereupon by operation of law
for the performance of any obligations of Tenant hereunder, Landlord
shall promptly execute and deliver to Tenant any instrument so
requested of it.
ARTICLE 16.
EVENTS OF DEFAULT: REMEDIES
a. Events of Default. Each of the following events shall be a default
hereunder by Tenant and a breach of this Lease:
i. If Tenant shall file a petition in bankruptcy or
insolvency or for reorganization or arrangement under
the bankruptcy laws of the United States or any
insolvency act of any state or shall voluntarily take
advantage
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of any such law or act by answer or otherwise or
shall be dissolved or shall make an assignment for
the benefit of creditors.
ii. If involuntary proceedings under any such bankruptcy
law or insolvency act shall be instituted against
Tenant or if a receiver or trustee shall be appointed
for all or substantially all of the property of
Tenant, and such proceedings shall not be dismissed
or such receivership or trusteeship vacated within
sixty (60) days after institution or appointment.
iii. If Tenant shall fall to pay Landlord any rent or
additional rent as and when the same shall become due
and payable and shall not make such payment within
five (5) days after notice thereof.
iv. If Tenant shall vacate or abandon the Premises.
v. If this Lease or the estate of Tenant hereunder shall
be transferred to or shall pay to or evolve upon any
other person or party, except in a manner permitted
under Article 14 hereof.
vi. If Tenant shall make an assignment for the benefit of
creditors or shall apply for or consent to the
appointment of a receiver for itself or any of its
property.
vii. If Tenant shall fail to keep, observe or perform any
of the other covenants and agreements herein
contained to be kept, observed and performed by
Tenant, and such failure, relative to a condition
which poses a risk of imminent harm to persons or
property shall continue for ten (10) days or sooner
if such condition requires immediate remedial action,
after notice thereof in writing to Tenant by
Landlord, or relative to a nonhazardous condition
which shall continue for thirty (30) days after
notice thereof in writing, to Tenant by Landlord,
provided, however, should remedial activity on the
part of Tenant reasonably require a period in excess
of the said period provided, Tenant shall not be
considered to have committed an event of default
provided it diligently pursues said remedial activity
for a reasonable period of time as may be required as
long as it diligently pursues such remedial activity.
b. Remedies. Upon the occurrence and continuance of Tenant's Event of
Default for failure to pay Rental when due, Landlord shall give Tenant
ten (10) days' written notice that Tenant's Event of Default has
occurred, specifying Tenant's Event of Default and the action required
necessary to cure Tenant's Event of Default. Upon the occurrence and
continuance of Tenant's Event of Default other than the failure to pay
Rent when due, Landlord shall give Tenant thirty (30) days' written
notice of Tenant's Event of Default, specifying Tenant's Event of
Default and the action required to cure Tenant's Event of
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Default. If Tenant fails to cure Tenant's Event of Default within the
time provided to cure, Landlord may resort to any and all legal
remedies or combination of legal remedies which Landlord may desire to
assert including but not limited to Landlord re-entering the Premises
by any lawful means, and removing all persons and chattels therefrom
and Landlord shall not be liable for damages or otherwise by reason of
re-entry or termination. Notwithstanding such termination, the
liability of Tenant for the rent provided for hereinabove shall not be
extinguished for the balance of the term remaining after said
termination.
Should termination of Tenant's estate occur as herein provided, or
should Landlord take possession pursuant to legal proceedings or
pursuant to any notice provided by law, it may either terminate this
lease or it may from time to time without terminating this Lease, make
such alterations and repairs as may be necessary in order to relet the
premises, and relet said premises or any part thereof for such term or
terms (which may be for a term extending beyond the term of this lease)
and at such rental or rentals and upon such other terms and conditions
as reletting, all rentals received by Landlord from such reletting,
shall be applied, first, to the payment of any indebtedness other than
rent due hereunder from Tenant to Landlord; second, to the payment of
any costs and expenses of such reletting including, brokerage fees and
attorneys' fees and of costs of such alterations and repairs; third, to
the payment of rent due and unpaid hereunder, and the residue, if any,
shall be held by Landlord and applied in payment of future rent as the
same may become due and payable hereunder.
If such rentals received from such reletting during any month be less
than that to be paid during that month by Tenant hereunder, Tenant
shall pay any such deficiency to Landlord. Such deficiency shall be
calculated and paid monthly. No such re-entry or taking possession of
said premises by Landlord shall be construed as an election on its part
to terminate this lease unless a written notice of such intention be
given to Tenant or unless the termination thereof be decreed by a court
of competent jurisdiction.
Notwithstanding any such reletting without termination, Landlord may at
any time thereafter elect to terminate this lease for such previous
breach. Should Landlord at any time terminate this lease for any
breach, in addition to any other remedies it may have, it may recover
from Tenant all damages it may incur by reason of such breach,
including the worth at the time of such termination of the excess, if
any, of the amount of rent and charges equivalent to rent reserved in
this lease for the remainder of the stated term over the then
reasonable rental value of the Premises for the remainder of the stated
term, all of which amounts shall be immediately due and payable from
Tenant to Landlord. In determining the rent which would be payable by
Tenant hereunder, subsequent to default, the rent for the unexpired
term shall be equal to the base monthly rent, for each remaining month
plus Tenant's share of taxes, insurance, and maintenance from the
commencement of the term to the time of default. Upon termination of
the Lease, Tenant shall surrender possession and vacate the Premises
immediately, and deliver possession thereof to Landlord.
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c. Cure of Default. If Tenant defaults in the making of any payment, or in
the doing of any act herein required to be made or done by Tenant, or
does or suffers any act prohibited herein, then Landlord may, but shall
not be required to, make such payment or do such act, or correct any
damage caused by such prohibited act and to enter the Premises as
appropriate in connection therewith, and the amount of the expense
thereof, if made or done so by Landlord, with interest thereon at the
Interest Rate (as hereinafter defined) from the date paid by Landlord,
shall be paid by Tenant to Landlord and shall constitute additional
rent hereunder due and payable with the next monthly installment of
rent; but the making of such payment or the doing of such act by
Landlord shall not operate to cure such default or to estop Landlord
from the pursuit of any remedy of which Landlord would otherwise be
entitled.
d. Landlord's Default. Should Landlord be in default under the terms of
this lease, Landlord shall have reasonable and adequate time in which
to cure the same after written notice to Landlord by Tenant.
e. Waiver of Redemption. Tenant hereby expressly waives, to the full
extent waivable, any and all rights or redemption granted by or under
any present or future laws in the event of Tenant being evicted or
dispossessed for any cause, or in the event of Landlord obtaining
possession of the Premises, by reason of the violation of Tenant of any
of the covenants or conditions of this lease, or otherwise.
f. Remedies Cumulative. No remedy herein or otherwise conferred upon or
reserved to Landlord or Tenant shall be considered to exclude or
suspend any other remedy, but the same shall be cumulative and shall be
in addition to every other remedy given hereunder now or hereafter
existing at law or by statute and every power and remedy given by this
Lease to Landlord or Tenant may be exercised from time to time and as
often as occasion may arise or may be deemed expedient. No delay or
admission of Landlord or Tenant to exercise any right or power arising
from any event of default shall impair any such right or power or shall
be construed to be a waiver of any such event of default or
acquiescence therein.
g. Miscellaneous. If any installment of rent is not paid by Tenant within
five days after the same becomes due and payable: (i) a late charge in
the amount of $100.00 shall become immediately due and payable as
compensation to Landlord for administrative costs; and (ii) the unpaid
balance due Landlord shall bear interest at the Interest Rate from the
date such installment became due and payable to the date of payment
thereof by Tenant, and such interest shall constitute additional rent
hereunder which shall be immediately due and payable. The "Interest
Rate" as used herein means four (4) points over the rate of interest
publicly announced from time to time by Norwest Bank Minneapolis N.A.
as its "prime rate", "base rate" or "reference rate", (or if more than
one exist, whichever is highest) each change in the interest rate
hereunder to become effective on the date the corresponding change in
such prime rate becomes effective.
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ARTICLE 17.
SURRENDER OF PREMISES
Tenant shall, upon the expiration or earlier termination of this Lease,
peaceably vacate and surrender the Premises to Landlord In good order, condition
and repair. reasonable wear and tear excepted. Tenant shall leave the Premises
and appurtenances thereto free and clear of rubbish and broom clean.
ARTICLE 18.
SUBORDINATION
a. Definition of Mortgage. For the purposes of this Article, the term
"Mortgage" shall mean at any time, any mortgage of record now or
hereafter placed against the Premises, any increase, amendment,
extension, refinancing or recasting of a Mortgage and, in the case of a
sale or lease and leaseback by Landlord of all or any part of the
Premises, the lease creating the leaseback. For the purposes hereof, a
Mortgage shall be deemed to continue in effect after foreclosure
thereof and during the period of redemption therefrom.
b. Subordination of Lease. As long as there is an executed Subordination,
Non-Disturbance and Attornment Agreement between the Landlord, Tenant
and any Mortgagee, this Lease is subject and subordinate to the lien of
any Mortgage which may now or hereafter encumber the Premises or any
development of which the Premises is a part. In confirmation of such
subordination., Tenant shall, at Landlord's request from time to time,
promptly execute any certificate or other document requested by the
holder of the Mortgage. Tenant agrees that in the event that any
proceedings are brought for the foreclosure of any Mortgage, Tenant
shall immediately and automatically attorn to the purchaser at such
foreclosure sale, as Landlord under this Lease, and Tenant waives the
provisions of any statute or rule of law, nor or hereafter in effect,
which may give or purport to give Tenant any right to terminate or
otherwise adversely affect this Lease or the obligations of Tenant
hereunder in the event that any such foreclosure proceeding is
prosecuted or completed. Neither the holder of the Mortgage (whether it
acquires title by foreclosure or by deed in lieu thereof) nor any
purchaser at foreclosure sale shall be liable for any act or omission
of Landlord, subject to any offsets or defenses which Tenant might have
against Landlord or bound by any prepayment by Tenant of more than one
month's installment of Base Rent and additional rent or by any
modification of this Lease made subsequent to the granting of the
Mortgage.
ARTICLE 19.
CERTIFICATES BY TENANT AND LANDLORD
a. Certificate by Tenant. Tenant shall, at any time and from time to time,
upon not less than twenty (20) days' prior notice by Landlord, execute
and acknowledge to Landlord a statement in writing certifying that this
Lease is unmodified and in full force and effect (or if there shall
have been modifications that the Lease is in full force and effect as
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modified and stating the modifications), and the dates to which the
base rent and the additional rent have been paid, and stating whether
or not to the best knowledge of the signer of such certificate,
Landlord is in default in keeping, observing or performing any term,
covenant, agreement, provision, condition or limitation contained in
this Lease, and, if in default, specifying each such default of which
the signer may have knowledge, it being intended that any such
statement delivered pursuant to this Article 19(a) may be relied upon
by Landlord or any prospective purchaser of the fee or any mortgage
thereto or any assignee of any mortgage upon the fee of the Premises,
but reliance on such certificate may not extend to any default of
Landlord as to which the signer for Tenant shall have had no actual
notice.
b. Certificate by Landlord. Landlord shall, at any time and from time to
time, upon not less than twenty (20) days' prior notice by Tenant
execute and acknowledge to Tenant a statement in writing, certifying
that this Lease is unmodified and in full force and effect (or if there
shall have been modifications that the Lease is in full force and
effect as modified and stating the modifications), and the dates to
which the base rent and additional rent have been paid, and stating
whether or not, to the best knowledge of the signer of such
certificate, Tenant is in default in keeping, observing or performing
any term, covenant, agreement, provision, condition, or limitation
contained in this Lease, and if in default, specifying each such
default of which the signer may have knowledge, it being intended that
any such statement delivered pursuant to this Article 19(b) may be
relied upon by any prospective assignee of Tenant's interest in this
Lease, any prospective sublessee of the entire Premises or any
mortgagee of this Lease or of any sublease of the entire Premises, or
any assignee of any mortgage upon the leasehold estate created hereby
or by any sublease, but reliance on such certificate may not extend to
any default of Tenant as to which the signer for Landlord shall have
had no actual knowledge.
ARTICLE 20.
NOTICE
All notices or demands which shall be required or permitted by law or
any provisions of this Lease shall be sent by United States certified mail,
postage prepaid, to the addresses set out below for Landlord and Tenant, and
such notices shall be properly given if directed to those addresses until
notices given in the manner described above to change such address.
To Tenant: Service One International Corporation
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxx Xxxxx, XX 00000
To Landlord: Xxxxxx X. Xxxxxx, Xx.
Commercial Division, Commerce Center
000 Xxxxx Xxxxxxxx Xxxxxx, Xxxxx 000
Xxxxx Xxxxx, XX 00000
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ARTICLE 21.
WAIVER
Failure of Landlord to insist upon the strict performance of any or all
of the terms or conditions herein shall not constitute, nor be construed as, a
waiver of Landlord's right to thereafter enforce any such terms or conditions,
but the same shall continue in full force and effect.
ARTICLE 22.
HOLDING OVER
In the event Tenant shall continue to occupy the Premises after the
expiration of the term hereof, such holding over shall not operate to extend or
renew this Lease, but shall be construed as a tenancy from month to month which
may be terminated by either party upon thirty (30) days, prior written notice.
Such month-to-month tenancy by Tenant shall be subject to all the terms and
provisions of this Lease.
ARTICLE 23.
COVENANTS
a. Covenant of Faithful Performance. It is mutually agreed that this Lease
is made upon and subject to the terms, covenants, and conditions herein
contained, and that Tenant covenants, as a material part of the
consideration for this Lease, to keep and perform each and all of said
terms, covenants and conditions to be kept and performed by it and that
this Lease is made upon the condition of such performance.
b. Provisions Deemed Covenants and Conditions. The parties hereto agree
that all the provisions hereof are to be construed as covenants and
conditions as though the words imparting such covenants and conditions
were used in each instance.
ARTICLE 24.
OPTION TO RENEW
a. Term. Tenant shall have the option to renew this lease upon the
expiration of the initial term for two additional terms of five (5)
years each.
b. Rental Adjustment During Renewal Terms. If Tenant exercises a renewal
option to extend the term of this Lease, the annual Base Rent during
the renewal term shall be equal to the annual Base Rent as in effect at
the end of the initial term plus any increase as determined in
accordance with the provisions of this Section. Annual Base Rent for
the renewal terms shall be based on the percentage of change in the
Consumer Price Index for Urban Wage Earners and Clerical Workers (All
Items Category) (1982-1984 = 100), as published from time to time by
the Bureau of Labor Statistics of the United States
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Department of Labor ("Consumer Price Index"), or if such Index is not
published, a similar index agreed upon by Landlord and Tenant.
The annual Base Rent for the first renewal term shall be calculated by
first determining the percentage change in the Consumer Price Index
between the date occurring sixty (60) days prior to September 21, 1996,
and the date occurring sixty (60) days prior to fifteenth annual
anniversary date of the term. The result, or ten percent (10%),
whichever is less, shall then be applied to the annual Base Rent in
effect immediately prior to the first renewal term. The result of the
calculation, when added to the annual Base Rental in effect immediately
prior to the fifteenth annual anniversary date, shall be the annual
Base Rent for the first renewal term.
The annual Base Rent for the second renewal term shall be calculated by
first determining the percentage change in the Consumer Price Index
between the date occurring sixty (60) days prior to the fifteenth
annual anniversary date of the term and the date occurring sixty (60)
days prior to the twentieth annual anniversary date of the term. The
result, or ten percent (10%), whichever is less, shall then be applied
to the annual Base Rental in effect during the first renewal term. The
result of the calculation, when added to the annual Base Rent in effect
during the first renewal term, shall be the annual Base Rent for the
second renewal term.
c. Notice of Exercise. If Tenant desires to exercise this option to renew
this lease, it shall provide written notice of that fact to Landlord no
later than ninety (90) days prior to the expiration of the initial term
of this lease.
ARTICLE 25.
GENERAL PROVISIONS
a. Captions. The captions of the Articles of this Lease are for
convenience only and are not a part of this Lease, and do not in any
way limit or amplify the terms or provisions of this Lease.
b. Successors and Assigns. Subject to the provisions hereof, this Lease
shall bind and inure to the benefit of the parties hereto and their
respective successors and assigns.
c. Attorney's Fees. In the event either of the parties hereto commences
any action or proceeding against the other under or on account of this
Lease, then and in each such event, the successful party in such action
or proceeding shall be entitled to receive, and the parties hereto
respectively agree to pay, a reasonable attorneys' fee on account of
such action or proceeding.
d. Construction. The language in all parts of this Lease shall be in all
cases construed according to its fair meaning and not strictly for or
against Landlord or Tenant.
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If any term, covenant, condition or provision of this Lease is held by
a court of competent jurisdiction to be invalid. void or unreasonable,
the remainder of the provisions hereof shall remain in full force and
effect and shall in no way be affected, impaired or invalidated
thereby.
The parties intend that the obligations herein of Tenant are the Joint
and several obligations of the corporation and the Guarantors named in
attached Lease Guaranty.
e. Force Majeure. Whenever a period of time is herein provided for either
party to do or perform any act or thing, that party shall not be
liability or responsible for any delays, and applicable periods for
performance shall be extended accordingly, due to strikes, lockouts,
riots, acts of God, shortages of labor or materials, national
emergency, acts of a public enemy, governmental restrictions, laws or
regulations, or any other cause or causes, whether similar or
dissimilar to those enumerated, beyond its reasonable control. The
provisions of this paragraph shall not operate to excuse Tenant from
prompt payment of rent, additional rent or other monetary payments
required by the terms of this Lease.
f. Law Governing. This Lease shall be governed by and construed in
accordance with the laws of the State of South Dakota.
g. Landlord Rules and Regulations. Tenant and its employees shall observe
and comply with any reasonable rules and regulations that Landlord or
Landlord's agents may from time to time adopt for the Premises and that
are applicable to Tenant provided Tenant has received notice of such
rules and regulations pursuant to the notice provisions of Article 20
hereof.
h. Initial Tenant Covenant. Tenant covenants and warrants that it has full
right and lawful authority to enter into this Lease for the full term
herein granted and for any and all extensions herein provided.
i. Entire Agreement. This Lease, together with any written modifications
or amendments hereto, hereinafter entered into, shall constitute the
entire agreement between the parties relative to the subject matter
hereof and shall supersede any prior agreements or understandings,
whether written or oral, which the parties may have had relating to the
subject matter hereof. No subsequent alteration, amendment, change or
addition to this Lease shall be binding upon Landlord or Tenant unless
reduced to writing and signed by them. Tenant shall not record this
Lease without Landlord's written consent.
j. Counterparts. This Lease may be executed in two or more counterparts,
each of which shall be deemed an original, but all of which together
shall constitute one and the same instrument.
k. Consent of Landlord. Wherever in this Lease the consent of Landlord is
required, it is agreed that such consent will not be unreasonably
withheld and will be promptly
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considered, and in the event Landlord does not refuse to grant such
consent in writing within thirty (30) days after request by Tenant
thereof, the same shall be deemed to have been given.
l. Tenant Financial Statements. On an annual basis, Tenant hereby agrees
to provide to Landlord a copy of its audited financial statements.
m. Brokerage Commission. Landlord will pay the brokerage commission payable in
connection with this Lease.
IN WITNESS WHEREOF, the parties hereto have executed this Net Lease
Agreement as of the day and year first above written.
LANDLORD TENANT
/s/ Xxxxxx X. Xxxxxx, Xx. Service One International Corporation
----------------------------
Xxxxxx X. Xxxxxx, Xx.
By /s/ Xxxxxx Xxxxx
----------------------------
Its President
------------------------
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Exhibit A
The Plans and Specifications as identified in paragraph 1(c)
of the Amended and Restated Lease Agreement are entitled "A
Xxxxxx Development Project -- Service One Addition" and
consist of 15 pages with such pages being identified as
follows:
Sheet Index
Civil Engineering Drawing
Cl Site Plan/Landscaping - 09/05/96
Architectural Drawings
T1 Title Page - 10/01/96
Al Floor Plan - 10/01/96
A2 Schedules/Details - 12/02/96
A3 Exterior Elevations - 10/01/96
A4 Wall Sections - 10/01/96
A5 Wall Sections - 10/01/96
Structural Drawings
S1 Foundation Plan - 9/10/96
S2 Foundation Details - 9/10/96
S3 Roof Framing Plan - 9/19/96
S4 Roof Framing Details - 9/19/96
E1 Electrical Lighting - 11/7/96
E2 Power & Signal - 11/7/96
M1 HVAC - 10/2/96
M2 Plumbing - 10/2/96
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