LEASE AGREEMENT
0000 Xxxx 00xx Xxxxxx
THIS LEASE AGREEMENT ("Lease") is made and entered into this 24th day of
June, 1998, by and between LINDUE, LLC, a Minnesota limited liability company
("Lessor") and NORTHWEST TELEPRODUCTIONS, INC., a Minnesota corporation
("Tenant"). Lessor and Tenant may be referred to as "Party" or "Parties" in this
Lease.
In consideration of the obligation of Tenant to pay rent as herein
provided, and in consideration of the other terms, provisions and covenants set
forth herein, Lessor and Tenant agree as follows:
1. LEASE OF PREMISES. Lessor hereby leases and demises to Tenant, and Tenant
hereby takes from Lessor, on an absolutely net basis as herein provided, certain
premises ("the Leased Premises") situated within Hennepin County, Minnesota,
consisting of the land, building or buildings, and improvements described in
Exhibit A attached to this Lease, including without limitation the entire
building ( "Building") located at 0000 Xxxx 00xx Xxxxxx, Xxxxx, Xxxxxxxxx. For
all purposes of this Lease, the Building shall be deemed to contain Twenty
Thousand (20,000) rentable square feet.
2. LEASE TERM; EXTENSION.
(a) Initial Term. This Lease shall be for a term ("the Lease Term") of 3
years, 6 days, commencing on the 24th day of June, 1998 ("the Commencement
Date") and terminating at 12:00 P.M. on June 30, 2001, unless (i) extended as
provided in subsection (b) of this Section 2, in which case the Lease Term shall
include the period during which such extension is effective, or (ii) terminated
as provided in this Lease, in which case the Lease Term shall terminate upon the
date of such termination unless specifically provided otherwise in this Lease.
(b) Extension. Provided that there exist no uncured default under this
Lease, this Lease shall automatically extend for an additional sixty (60)
months, through and including June 30, 2006, upon the same terms and conditions
and at the Base Rent rates set forth in Exhibit B attached to this Lease;
provided, however, if Tenant gives Lessor written notice of its election to have
the Lease Term expire at the end of the initial Lease Term on or before December
31, 2000 the Lease Term shall not be so extended. If no such notice is given and
the Lease Term is extended, all references to the Lease Term shall then be
deemed to include the period ending June 30, 2006.
3. CONDITION OF PREMISES; ACCEPTANCE OF THE LEASED PREMISES. Tenant acknowledges
that Lessor has made no representations or warranties, express or implied, with
respect to the Leased Premises. Tenant requires no leasehold improvements. By
occupying the Leased Premises, Tenant shall be deemed to have accepted the
Leased Premises "AS IS" and "WITH ALL FAULTS," except for (i) defects for which,
and to the extent to which, Lessor has the benefit of any surviving warranty,
and (ii) necessary roof repairs as described in that Real Estate Purchase
Agreement between the Parties, dated June 24, 1998.
4. RENT. Rent for the Leased Premises ("Rent") shall consist of Base Rent as
described in Section 5 hereof, Tax Costs as described in Section 6 hereof,
Operating Costs as described in Section 7 hereof, Additional Rent as described
in Section 8 hereof, and any and all other amounts to be paid by Tenant to
Lessor pursuant to this Lease.
5. BASE RENT. (a) Tenant shall pay to Lessor during the Lease Term a yearly rent
("Base Rent") in monthly installments thereof ("Monthly Base Rent") as set forth
on Exhibit B attached hereto, payable in advance on the first day of each month
during the Lease Term in lawful money of the United States, without any
deduction, offset, counterclaim or reduction whatsoever, at the office of
______________________________________ or at such other place as Lessor shall
designate in writing.
(b) In the event the Lease Term commences on a day other than the first day
of a month, or terminates on a day other than the last day of a month, or both,
Rent payable during such first or last month (including any adjustments to Rent
made in accordance with this Lease) shall be adjusted pro rata on the basis of a
30-day month.
6. TAX COSTS. (a) With each monthly installment payment of Monthly Base Rent
during the period commencing the Commencement Date and extending through March
31, 1999, Tenant will pay the Tax Costs set forth in Exhibit B attached to this
Lease. Thereafter, in each calendar year or portion thereof during the Lease
Term or any extensions or renewals thereof, Tenant shall pay to Lessor, in
addition to Base Rent, the total general real estate taxes and installments of
special assessments ("Tax Costs") due and payable with respect to the Leased
Premises in such year. Such payment by Tenant shall be paid at the same time and
in the same manner as Monthly Base Rent in equal monthly installments estimated
by Lessor to equal one twelfth (1/12) of Tax Costs due and payable in any such
year. At Landlord's election, Landlord may reasonably revise the estimate of Tax
Costs and adjust the monthly installments of said estimated amount to be paid by
Tenant with its monthly installments of Base Rent. Prior to March 1 of each
calendar year, or as soon as is practicable thereafter, Lessor shall furnish
Tenant with an estimate of Tax Costs for the then current calendar year. Within
ten (10) days after Lessor furnishes Tenant with such estimate, Tenant shall pay
to Lessor, as an additional payment, the total amount by which the estimated Tax
Costs for any months of the calendar year exceeds the total amount of Tax Costs
that Tenant shall have paid for those months. If such amount is less than the
payments made by Tenant for such monthly periods, Tenant may deduct the
difference from the next monthly installment payment.
(b) After expiration of each calendar year during the Lease Term or any
extension or renewal thereof, through and including the calendar year in which
the Lease Term or any extension or renewal thereof expires, Lessor shall furnish
Tenant with a statement of actual Tax Costs for the immediately preceding
calendar year. If actual Tax Costs differ from estimated Tax Costs, within ten
(10) days after Lessor has furnished such statement to Tenant, Tenant shall pay
to Lessor any shortage for the immediately preceding calendar year, or Lessor
shall refund to Tenant any overage for the immediately preceding calendar year,
as the case may be.
(c) If the first or last day of the Lease Term occurs on a day other than
the first or last day, respectively, of a calendar year, then Tenant's
obligation under this Section 6 shall be prorated based on a 365-day calendar
year.
(d) Lessor's reasonable determination of estimated Tax Costs shall be
binding upon Tenant.
(e) Lessor shall have the exclusive right to challenge or litigate against
any taxing authority regarding taxes levied or imposed on the Leased Premises or
any portion thereof, appraisals or valuations of the Leased Premises or any
portion thereof, or any other aspect of or procedure for determining taxes or
similar charges. If Lessor does not initiate proceedings to challenge, protest,
xxxxx, and/or reduce any real estate taxes payable during the Lease Term, after
thirty (30) days' written notice to Lessor, Tenant may initiate such
proceedings. Notwithstanding any such action by Tenant, Tenant shall remain
liable for and shall timely pay Tax Costs as provided in this Lease, subject to
revision of Tax Costs due to increase, reduction or refund of real estate taxes
as a result of such action. Should Tax Costs for a prior year be partially
refunded following a challenge by Lessor or Tenant, the refund shall accrue to
the party who paid the tax that was the subject of the refund.
(f) Tenant's failure to pay any amounts due under this Section 6 when due
shall be a default in the payment of Base Rent.
7. OPERATING COSTS. (a) The term "Operating Costs" shall mean all costs and
expenses of every kind and nature which Lessor incurs, pays or becomes obligated
to pay in owning, managing (including reasonable management contracts and fees,
if any), insuring, operating and maintaining the Leased Premises and every part
thereof exclusive of depreciation, interest or payments of any principal on any
mortgage or other encumbrance; provided, however, that Operating Costs shall not
include the costs described on attached Exhibit C. Without limiting the
generality of the foregoing and without implying or creating any obligations of
Lessor which are not specifically set forth in this Lease, Operating Costs shall
include amortization of capital expenditures that produce a reduction in energy
or other Operating Costs, over the expected useful life of the item together
with interest at the rate of twelve percent (12%) per annum on the unamortized
balance.
(b) With each monthly installment payment of Monthly Base Rent during the
period commencing the Commencement Date and extending through March 31, 1999,
Tenant will pay the Operating Costs set forth in Exhibit B attached to this
Lease. Thereafter, in each calendar year or portion thereof during the Lease
Term or any extensions or renewals thereof, Tenant shall pay to Lessor, in
addition to Base Rent, the total Operating Costs for the Leased Premises in such
year. Such payment by Tenant shall be paid at the same time and in the same
manner as Monthly Base Rent in equal monthly installments estimated by Lessor to
equal one twelfth (1/12) of Operating Costs due and payable in any such year.
Prior to March 1 of each calendar year, or as soon as is practicable thereafter,
Lessor shall furnish Tenant with an estimate of Operating Costs for the then
current calendar year. Within ten (10) days after Lessor furnishes Tenant with
such estimate, Tenant shall pay to Lessor, as an additional payment, the total
amount, if any, by which the estimated Operating Costs for any months of the
calendar year exceeds the total amount of Operating Costs that Tenant shall have
paid for those months.
(c) Within sixty (60) days after expiration of each calendar year during
the Lease Term or any extension or renewal thereof, through and including the
calendar year in which the Lease Term or any extension or renewal thereof
expires, Lessor shall furnish Tenant with a statement of actual Operating Costs
for the immediately preceding calendar year. If actual Operating Costs differ
from estimated Operating Costs, within ten (10) days after Lessor has furnished
such statement to Tenant, Tenant shall pay to Lessor any shortage for the
immediately preceding calendar year, or Lessor shall refund to Tenant any
overage for the immediately preceding calendar year, as the case may be.
(d) If the first or last day of the Lease Term occurs on a day other than
the first or last day, respectively, of a calendar year, then Tenant's
obligation under this Section 7 shall be prorated based on a 365 day calendar
year.
(e) Lessor's reasonable determination of estimated Operating Costs shall be
binding upon Tenant.
(f) Tenant's failure to pay any amounts due under this Section 7 when due
shall be a default in the payment of Base Rent.
(g) Upon reasonable prior written notice to Lessor, Tenant at its sole
expense may audit and review Lessor's records substantiating and evidencing
Operating Costs. Notice of Tenant's intention to audit such records of Lessor
must be given within one hundred twenty (120) days following receipt by Tenant
of Lessor's statement of actual Operating Costs for the immediately preceding
calendar year, and the audit must be completed not later than one hundred eighty
(180) days following such receipt by Tenant. If Tenant's audit discloses a
discrepancy in Lessor's calculation of Operating Costs, the Parties will make an
appropriate adjustment to Tenant's obligation.
8. ADDITIONAL RENT. Wherever it is provided in this Lease that Tenant is
required to make a payment to Lessor or to pay utilities or other sums of money
to third parties, such payment shall be deemed Additional Rent; and all remedies
applicable to the nonpayment or late payment of Rent shall be applicable to
Additional Rent.
Tenant's obligation to pay Additional Rent commences on the Commencement Date.
9. SECURITY DEPOSIT. Tenant has deposited with Lessor the amount of Twenty
Thousand Dollars ($20,000) as a security deposit ("the Security Deposit") to be
held by Lessor as security for the faithful performance by Tenant of (i) all the
terms, covenants and conditions of this Lease and (ii) those of that Lease
Agreement between the Parties, dated the same date as this Lease, for Leased
Premises located at 0000 Xxxx 00xx Xxxxxx, Xxxxx, Xxxxxxxxx, to be met, kept and
performed by Tenant during the Lease Term. The Security Deposit shall be
maintained in a separate account (which may include the security deposit for the
Leased Premises located at 0000 Xxxx 00xx Xxxxxx, and Tenant shall be entitled
to interest thereon at passbook rates. If Tenant defaults with respect to any
provision of this Lease, including, but not limited to the provisions relating
to the payment of Rent, Lessor may but shall not be required to use, apply or
retain all or any part of said security deposit for the payment of any Rent or
any other sum in default, or for the payment of any amount which Lessor may
spend or become obligated to spend by reason of Tenant's default, or to
compensate Lessor for any other loss or damage which Lessor may suffer by reason
of Tenant's default. If any portion of the Security Deposit is so used or
applied, Tenant shall, within five (5) days after written demand therefor,
deposit cash with Lessor in an amount sufficient to restore said security
deposit to its original amount, and Tenant's failure to do so shall be a
material breach of this Lease. If Tenant shall fully and faithfully perform
every provision of this Lease to be performed by it, the Security Deposit or any
balance thereof shall be returned to Tenant (or, at Lessor's option, to the
assignee of Tenant's interest hereunder) at the expiration of the Lease Term. In
the event Lessor assigns its interest in this Lease, Lessor shall transfer the
Security Deposit to Lessor's successor in interest.
10. This Section 10 left blank intentionally
11. USE. Tenant shall occupy and use the Leased Premises for general office
purposes and for other activities for which Tenant has used the Leased Premises
prior to this Lease, and for no other purpose. Notwithstanding anything to the
contrary in the preceding sentence, Tenant shall not use or allow the use of the
Leased Premises for retail, warehousing or manufacturing purposes or for any
purpose which constitutes a nuisance, is illegal or offensive, is termed extra
hazardous by insurance companies, or may make void or voidable any insurance on
the Leased Premises or increase the premiums therefor.
12. SECURITY. Tenant shall provide such security services for the Buildings and
the Leased Premises as Lessor may reasonably require.
13. MAINTENANCE, REPAIRS AND SERVICES BY LESSOR. Without creating or assuming
any obligation or liability not specifically provided for in this Lease, Lessor
may in its sole discretion perform any maintenance, make any repairs and furnish
any services which Tenant fails timely to perform, make or furnish, and all
reasonable costs and expenses of any such maintenance and repairs shall be added
to the Operating Costs defined in Section 7(a) of this Lease.
14. MAINTENANCE AND REPAIRS BY TENANT. Tenant shall at its sole cost and expense
maintain and repair, and replace as necessary, all of the Leased Premises
(including without limitation: the roof, foundation and exterior walls of the
Building; the air conditioning, heating, plumbing, electrical and other
utilities systems; the parking lot, walk, driveway or driveways; and the
landscaping) in good order and repair and in a safe and tenantable condition,
reasonable wear and tear excepted. Without limiting the previous sentence,
Tenant shall keep the whole of the Leased Premises in a clean, sanitary, and
safe condition and shall be responsible for all trash, snow and ice removal for
the Leased Premises. Tenant shall not commit deteriorating waste on the Leased
Premises or allow deteriorating waste to be committed by any of Tenant's agents,
employees, licensees, subtenants, invitees or contractors., and will at the
expiration of the Lease Term or other termination of this Lease surrender the
same to Lessor in the same order and condition as they were in at the
commencement of the Lease Term, reasonable wear and tear and insured casualty
excepted.
Tenant may make any repair or replacement required or permitted to be
performed by Tenant under any provision of this Lease without the prior approval
of Lessor so long as the repairs are not "material." Any structural repair or
any repair which affects any utility system shall be considered a "material"
repair and shall require the prior, written approval of Lessor before any such
work is performed; provided, however, that no such approval shall be required in
an emergency as long as Tenant makes a reasonable effort to contact Lessor
beforehand. In addition, no material repair shall be commenced until plans and
specifications therefor shall have been submitted to and approved by Lessor. Any
approval required by this Section 14 shall be deemed to have been given if
Lessor does not respond within fifteen (15) business days after its receipt of
Tenant's proposed plans and specifications, if any, and request for approval.
After approval, the work shall be commenced promptly, performed in accordance
with the approved plans and specifications, and continued diligently to
completion.
15. ALTERATIONS; MECHANIC'S LIENS. (a) Tenant shall not make any alterations of
or additions to the Leased Premises without the prior written consent of Lessor,
except that Tenant may make alterations within the Building without such prior
consent so long as the alterations are not "material." Any alteration that
increases the weight loan on the roof of the Building, any structural
alteration, any alteration which affects any utility system, or any physical
addition shall be considered a "material" alteration. All alterations or
physical additions shall be performed in a good and workmanlike manner in
accordance with all applicable legal requirements, insurance requirements, and
free of all liens, and if material, pursuant to plans and specifications
approved by Lessor and other reasonable conditions which Lessor shall impose on
such work and on the contractors to be used for such work. Any approval required
by this Section 15 shall be deemed to have been given if Lessor does not respond
within fifteen (15) days after its receipt of Tenant's proposed plans and
specifications, if any, and request for approval. After approval, the work shall
be commenced promptly, performed in accordance with the approved plans and
specifications, and continued diligently to completion. If Lessor disapproves
Tenant's plans, Lessor shall explain with reasonable specificity its reasons for
disapproval, and the changes, if any, that would cause Lessor to approve the
plans.
(b) At the termination of this Lease, Tenant shall, if Lessor so elects,
remove all alterations and additions erected by Tenant and restore the Leased
Premises to their original condition; otherwise, such improvements shall be
delivered up to Lessor with the Leased Premises.
(c) If any mechanic's, materialman's or similar lien is filed against the
Leased Premises or any part of them as a result of any work or act of Tenant,
its contractors or agents, Tenant shall (i) cause the lien to be discharged
within fifteen (15) days after the filing of the lien, or (ii), within such 15
days, file a bond, letter of credit or other security reasonably acceptable to
Lessor sufficient to indemnify Lessor and the Leased Premises from and against
such lien, and Tenant shall diligently contest such lien. If Tenant shall fail
to cause the discharge of the lien, or to provide such security, or to contest
such lien diligently, Lessor may, but shall not be obligated to, after five (5)
days' notice to Tenant, bond or pay the lien for the account of Tenant without
inquiring into the validity thereof. In such event, the Tenant shall, within
fifteen (15) days after receipt of demand therefor from Lessor, reimburse Lessor
the amount so paid or the costs and expenses of such bond. Upon completion of
any repair, alteration or other work performed by Tenant or its agents and
contractors to the Leased Premises, Tenant shall provide Lessor with copies of
lien waivers from each contractor, agent or vendor who performed work or
supplied materials relative to such work.
16. SIGNS. Tenant may retain such sign or signs that are on or within the Leased
Premises on the Commencement Date and that identify Tenant, and Tenant may
install similar signs subject to Lessor's prior written approval. Lessor may
also install and maintain a sign or signs on and within the Leased Premises. All
signs installed by either Party shall comply with all applicable laws and
ordinances.
17. ACCESS BY LESSOR. (a) Lessor, its agents and representatives shall have the
right to enter and inspect the Leased Premises and any portion of them at any
time for any of the following purposes: (i) inspecting the Leased Premises; (ii)
showing the Leased Premises to prospective purchasers, mortgagees or lessees;
and (iii) platting or surveying the Leased Premises. Lessor shall endeavor to
give Tenant reasonable prior notice when possible. During the period that is
twelve (12) months prior to the end of the Lease Term, Lessor and its agents and
representatives shall have the right to erect on the Leased Premises a suitable
sign indicating that the Leased Premises are available. Any such entry by Lessor
shall not be deemed an eviction or a disturbance of Tenant's possession of the
Leased Premises, or render Lessor liable to Tenant for damages, or relieve
Tenant from performance of Tenant's obligations under this Lease. The right of
entry reserved shall not impose any obligation on Lessor to clean, maintain,
repair or change the Leased Premises.
(b) Lessor, its agents and representatives may at any time in case of
emergency enter the Leased Premises and do such acts as Lessor may deem proper
in order to protect the Leased Premises or any occupants of the Leased Premises.
(c) Lessor shall hold keys to all locks in the Leased Premises, and all
such keys shall remain the property of Lessor. No additional locks shall be
allowed on any door of the Leased Premises without Lessor's prior written
permission, and Tenant shall not make or permit to be made any duplicate keys,
except those furnished by Lessor. Upon termination of this Lease, Tenant shall
promptly surrender to Lessor all keys for the Leased Premises and the Building
and give to Lessor the combination of all locks for safes, safe cabinets and
vault doors, if any, remaining on the Leased Premises. Any and all costs
resulting from the loss or duplication of any key by Tenant or Tenant's
employees or invitees, including but not limited to the cost of changing locks
on and making keys for the Leased Premises or the Building, shall be paid by
Tenant. The term "key" as used herein shall include any electronic access card
necessary for access to the Building.
18. UTILITIES AND SERVICES. Without limiting any provisions of Section 14 or any
other provisions of this Lease, Tenant shall be responsible at its sole cost and
expense for obtaining and furnishing all gas, water, electricity and any other
utilities and all services (hereinafter in this Section 18 sometimes referred to
collectively as "utilities and services") for the Leased Premises, and Tenant
shall pay directly to the providers of the utilities and services any and all
charges for them. Without limiting the previous sentence in any way:
(a) Delivery. Tenant shall at its sole cost and expense maintain, repair
and replace (i) any utility systems and facilities (including without limitation
pipes, plumbing, conduits and wiring) for delivering any utilities to the Leased
Premises and (ii) any apparatuses and devices (including without limitation air
conditioners, furnaces and boilers, and electrical lamps, bulbs, starters and
ballasts) related to furnishing such facilities;
(b) Elevators. Tenant shall be responsible at its sole cost and expense for
maintaining, repairing and replacing any elevator or elevators in or on the
Leased Premises;
(c) Telephones. Tenant shall be responsible at its sole cost and expense
for installation, maintenance, repair and replacement of all telephones and
related wiring in the Leased Premises, and the removal of the same (other than
wiring);
(d) Temporary Interruption of Services. (i) Lessor shall not be liable to
Tenant, its agents, employees, representatives, customers or invitees for any
inconvenience, loss or damage or for any injury to any person or property caused
by or resulting from any breakdowns or from any temporary failure or lack of
utilities or services, and Tenant shall indemnify Lessor and hold Lessor
harmless from any claim or damage because of such inconvenience, loss, damage or
injury; and (ii) no variation, interruption or failure of such utilities or
services incident to the making of repairs, alterations or improvements or due
to breakdowns or any temporary failure or lack of such services shall be deemed
an eviction of Tenant or relieve Tenant from any of Tenant's obligations
hereunder;
(e) Janitorial. Tenant shall furnish janitor service for the Building and
shall keep the Building in a clean, sanitary, and safe condition;
(f) Lessor Approval of Repairs and Replacements. Tenant shall comply with
the provisions of Section 14 relating to material repairs or replacements in
making any repair or replacement required by this Section 18; and
(g) General. Without limiting the scope of the definition of Operating
Costs set forth in Section 7(a) of this Lease, any expenses incurred by Lessor
pursuant to this Section 18 shall be deemed Operating Costs.
19. SUBLETTING AND ASSIGNMENT. Tenant shall not sublease the whole or any part
of the Leased Premises without the prior written consent of Lessor, which
consent may be given or withheld in Lessor's reasonable discretion. Tenant shall
not, voluntarily or by operation of law, assign, mortgage, pledge or otherwise
transfer this Lease without the prior written consent of Lessor, which consent
may be given or withheld in Lessor's sole and absolute discretion. Any
transaction or series of transactions (including without limitation any
dissolution, merger, consolidation or other reorganization of Tenant or any
issuance, sale, gift, transfer or redemption of any capital stock of Tenant,
whether voluntary, involuntary or by operation of law, or any combination of any
of the foregoing transactions) resulting in the transfer of control of Tenant,
shall be deemed to be an assignment of this Lease by Tenant
To request any prior written consent of Lessor required by this Section 19,
Tenant shall submit to Lessor: the request in writing; a proposed sublease or
assignment; financial and banking information regarding the proposed sublessee
or assignee; references regarding the proposed sublessee or assignee; and such
further information as Lessor might reasonably require. Within fifteen (15) days
following Lessor's receipt of all such required submissions, Lessor shall notify
Tenant in writing whether Lessor consents to the proposed sublease or
assignment. Failure by Lessor to notify within said fifteen (15) day period
shall be deemed consent by Lessor.
20. FIRE AND OTHER CASUALTY. If the Building or a substantial part thereof is
damaged or destroyed by fire or other casualty, Lessor shall have the option,
exercisable in Lessor's sole and absolute discretion by giving written notice to
Tenant within ninety (90) days after such damage or destruction, to terminate
this Lease within thirty (30) days from the date said notice is given to Tenant.
If a portion of the Building is damaged by fire or other casualty and this Lease
is not terminated pursuant to the preceding sentence, Lessor shall, at its
expense, restore the Building, exclusive of any improvements or other changes
made to the Building by Tenant, to as near the condition which existed
immediately prior to such damage or destruction as reasonably practicable, and
all Rent shall xxxxx during such period of time as the Building is untenantable
in the proportion that the untenantable portion of the Building bears to the
entire Building. Lessor shall not be responsible to the Tenant for, and Tenant
shall make no claim against Lessor for, any damage to or theft or destruction of
any personal property, furniture, equipment, improvements or other changes made
by Tenant in, on or about the Building, except for any such damage or
destruction that is the direct result of any reckless or intentional act or
omission of Lessor or its employees. Lessor shall endeavor to advise Tenant of
Lessor's decision regarding restoration as early as possible after Lessor makes
that decision.
21. INSURANCE; WAIVER OF SUBROGATION.
(a) Casualty Insurance; Risk of Loss. Throughout the Lease Term, Tenant
shall at its own cost and expense provide and maintain an extended coverage
casualty insurance policy on all Tenant's fixtures, equipment, machinery,
improvements, furniture and personal property (including without limitation any
property of others held by, leased by, or in the possession of Tenant) in the
amount of full replacement cost thereof, including without limitation coverage
against sprinkler and water damage. Upon execution of this Lease, Tenant shall
provide Lessor a copy of said policy or a certificate evidencing such insurance
coverage.
All property of any kind which may be on or at the Leased Premises shall be
at the sole and absolute risk of Tenant or those claiming through or under
Tenant. Tenant hereby releases Lessor from any and all liability or
responsibility to Tenant or anyone claiming through or under Tenant by way of
subrogation or otherwise for any loss or damage to property caused by fire or
any of the extended coverage casualties required to be covered by the insurance
required to be provided and maintained hereunder.
(b) Liability Insurance. Throughout the Lease Term, Tenant shall at its own
cost and expense provide and maintain a comprehensive policy of liability
insurance with respect to the Leased Premises. The Liability insurance policy
shall name Lessor, any mortgagee of the Leased Premises, Lessor's management
company, if any, and any designee of Lessor as additional insureds. The policy
shall be written by an insurer acceptable to Lessor in the amounts of not less
than One Million Dollars ($1,000,000) for personal or bodily injuries sustained
by any one person, Two Million Dollars ($2,000,000) for personal or bodily
injuries sustained in any one occurrence, and One Hundred Thousand Dollars
($100,000.00) for property damage. (A portion of such coverage may be provided
by an umbrella policy maintained by Tenant. Upon execution of this Lease, Tenant
shall provide Lessor a copy of said policy or a certificate evidencing such
insurance coverage.
(c) Blanket Insurance Policy. Any insurance required to be maintained by
Tenant under this Lease may be maintained under a "blanket" policy covering the
Leased Premises and other facilities and locations of Tenant. If Tenant does
include the Leased Premises under such a blanket policy and Tenant delivers to
Lessor a certificate rather than a copy of the insurance policy, Tenant shall
also deliver such other information as Lessor may reasonably require in order
for it to determine the exact coverage provided.
(d) Cancellation; Failure to Renew; Material Change. Each insurance policy
required to be carried under this Section 21 shall provide (and any certificate
evidencing any insurance coverage shall certify) that, unless Lessor shall be
given twenty (20) days' written notice, (i) the insurance policy shall not be
canceled and shall continue in full force and effect, (ii) the insurance carrier
shall not fail to renew the insurance policy for any reason, and (iii) no
material change shall be made in the insurance policy. The term "insurance
policy" shall include without limitation any extensions or renewals of an
insurance policy.
22. INDEMNITY. Tenant shall indemnify, hold harmless and defend Lessor from and
hold Lessor harmless against all liabilities, damages, claims, fines, penalties,
costs and other expenses, including all reasonable attorney's fees, which may be
imposed upon, incurred by, or asserted against Lessor by reason of any bodily
injury, personal injury, death or property damage occurring in, on or about the
Leased Premises or occurring by reason of (a) any negligence of Tenant, its
successors, assigns or subtenants or its or their employees, agents,
contractors, licenses or invitees, (b) any failure of Tenant to comply with any
requirement of any governmental authority applicable to Tenant's use and
occupancy of the Leased Premises, (c) any litigation commenced by or against
Tenant to which Lessor is made a party without any fault on the part of Lessor,
and (d) any failure by Tenant to perform or comply with any covenant or
agreement of Tenant set forth in this Lease, except to the extent such injury,
death or property damage shall be the direct result of the negligent or
intentional act or omission of Lessor or its employees, agents or contractors.
23. EMINENT DOMAIN. If the entire Leased Premises or the Building is taken by
eminent domain, this Lease shall automatically terminate as of the date of
taking. If a portion of the Leased Premises or the Building is taken by eminent
domain, Lessor shall have the right to terminate this Lease by giving written
notice thereof to Tenant within ninety (90) days after the date of taking. If a
portion of the Leased Premises or the Building is taken by eminent domain and
this Lease is not terminated by Lessor pursuant to the immediately preceding
sentence, Lessor shall, at its expense, restore the Leased Premises or the
Building, exclusive of any improvements or other changes made to the Leased
Premises by Tenant, to as near the condition which existed immediately prior to
the date of taking as reasonably possible, and Rent shall xxxxx during such
period of time as the Leased Premises or the Building is untenantable, in the
proportion that the untenantable portion of the Leased Premises or the Building
bears to the entire Leased Premises or the Building. All damages awarded for a
taking under the power of eminent domain, whether for the whole or a part of the
Leased Premises, shall belong to, and be the property of Lessor, whether such
damages shall be awarded as compensation for diminution in value to the
leasehold estate hereby created or to the fee of the Leased Premises; provided,
however, that Lessor shall not be entitled to any separate award made to Tenant
for loss of business or the fair value of and/or cost of removal of stock and
fixtures. The term "eminent domain" shall include the exercise of any similar
governmental power and any purchase or other acquisition in lieu of
condemnation.
24. HOLDING OVER. Should Tenant or any of its successors in interest hold over
the Leased Premises or any part thereof after the expiration of the Lease Term,
such holding over, at the sole election of Lessor, shall constitute and be
construed as a tenancy from month to month only. The inclusion of the preceding
sentence shall not be construed as Lessor's permission to hold over. Base Rent
during any such holdover period shall be two (2) times Base Rent paid by Tenant
at the expiration of the Lease Term.
25. QUIET ENJOYMENT. Lessor covenants that if Tenant pays Rent (including
without limitation all charges which are included in Rent pursuant to this
Lease), performs all its obligations required by this Lease, and observes all
the other provisions of this Lease, Tenant shall peaceably and quietly enjoy the
Leased Premises in accordance with the terms of this Lease without any
interruption or disturbance from Lessor. Lessor shall not be responsible or
liable for the actions of third parties.
26. EVENTS OF DEFAULT. Each of the following shall constitute an "Event of
Default" by Tenant under this Lease:
(a) The failure by Tenant to pay any installment of Rent, or any part of
Rent (including without limitation any charge to be paid by Tenant under this
Lease), when due and for a period of five (5) days after Lessor makes written
demand therefor;
(b) The insolvency of Tenant, any transfer by Tenant in fraud of creditors,
or any assignment by Tenant for the benefit of creditors;
(c) The filing of a petition by Tenant (or failure to dismiss such a
petition within thirty (30) days following filing of it by a third person) under
any Section or chapter of the United States Bankruptcy Code, as amended, or
under any similar law or statute of the United States or any state thereof,
seeking relief from Tenant's creditors, or the adjudication thereunder that
Tenant is bankrupt or insolvent;
(d) The appointment of a receiver or trustee for all or substantially all
of the assets of Tenant;
(e) Tenant vacates or abandons the Premises.
(f) Tenant's causing or suffering a lien to be filed against the Leased
Premises or any part thereof and failure to obtain dismissal of such lien within
fifteen (15) days after filing;
(g) Tenant's failure timely to take any action or provide to Lessor any
report, statement, forecast or plan required by this Lease, including without
limitation the provisions of Section 32 of this Lease;
(h) The failure by Tenant to comply with any other term, provision or
covenant of this Lease and to cure such failure within ten (10) days after
notice from Lessor; provided, however, that if a default is not reasonably
susceptible of being cured within a ten (10) day period, Tenant shall be given
reasonable additional time to effect a cure so long as Tenant promptly commences
action to effect a cure and thereafter diligently proceeds to cure the default
as quickly as reasonably possible.
Upon the occurrence of any Event of Default, whether known or unknown to Lessor
and whether or not Lessor shall have given notice to Tenant regarding any remedy
available to Lessor, Tenant shall be deemed "in Default" under this Lease.
27. REMEDIES. (a) Upon the occurrence of any Event of Default, Lessor at its
option and in addition to all other rights and remedies available to Lessor by
law or by other provisions hereof, may, upon written notice to Tenant:
(i) terminate this Lease and all of Lessor's and Tenant's rights and
obligations hereunder except as provided in subsection (b),
below; or
(ii) declare this Lease forfeited but not terminated; and
(iii) in connection with either such termination or such forfeiture,
reenter the Leased Premises, in accordance with applicable
law, using such reasonable force as may be necessary to remove
all persons and property therefrom, and Lessor shall not be
liable for damages by reason of such reentry or forfeiture.
(b) In the event of any termination pursuant to subsection (a)(i) or any
forfeiture pursuant to subsection (a)(ii) of this Section 27, or any other
termination or forfeiture, Tenant shall indemnify Lessor against and pay to
Lessor any and all loss of rents and other damages which Lessor may incur by
reason of such termination or forfeiture, including without limitation:
(i) unpaid installments of Rent or other unpaid amounts to Lessor
which were due as of the termination or forfeiture described
above, including interest and late payment fees, payable
immediately;
(ii) Rent and other amounts to Lessor falling due pursuant to
provisions of this Lease for the balance of the Lease Term
following such termination or forfeiture, during which the Leased
Premises remain vacant, including interest, which amounts shall
be payable as they become due under this Lease (for purposes of
this subsection (b)(ii), the Lease Term will not terminate upon
such termination or forfeiture of the Lease);
(iii) all reasonable, actual expenses incurred in releasing the Leased
Premises, including without limitation costs for leasing
commissions, remodeling, and restoring and repairing the Leased
Premises and putting them in rentable condition, which shall be
payable as they are incurred by Lessor;
(iv) all reasonable attorneys' fees and expenses incurred by reason of
Tenant's default or in connection with exercising any remedy
hereunder;
(v) (while the Leased Premises are subject to any new lease or leases
made pursuant to this Section 27), the amount by which the
monthly installments payable under such new lease or leases is
less than the monthly installment for all charges that would have
been payable pursuant to this Lease, which deficiencies shall be
payable monthly.
(c) All rights and remedies of Lessor set forth herein shall be cumulative
and not exclusive of each other.
28. LATE CHARGE. In the event Tenant fails to pay any Rent within five (5) days
after due, Tenant shall pay to Lessor a late charge in the amount of $250.00.
Lessor shall waive such late charge once in any twelve (12) month period so long
as the required payment is made not later than fifteen (15) days of the date the
same was due. The provision for such late charge shall be in addition to all of
Lessor's other rights and remedies hereunder or at law and shall not be
construed as liquidated damages or as limiting Lessor's remedies in any manner.
In addition to such late charge, any and all Rent not paid within ten (10) days
after due shall bear interest at the rate of twelve percent (12%) per annum or
the highest rate permitted by law, whichever is less, from the date due until
paid.
29. SUBORDINATION AND ATTORNMENT. At Lessor's election, the rights of Tenant
under this Lease shall be and are subject and subordinate to any ground lease or
underlying lease now or hereafter in force against the Leased Premises or the
Building, and to any mortgage or mortgages now or hereafter in force against
such leases or the Leased Premises, and to all advances made or hereafter to be
made upon the security thereof, and to all renewals, modifications,
consolidations, replacements and extensions thereof, provided such ground
lessor, underlying lessor or mortgagee agrees to recognize this Lease and not
disturb Tenant's possession so long as Tenant is not in default beyond any
applicable cure period. At the option of any mortgagee or any lessor under any
ground lease or underlying lease, Tenant shall attorn to such mortgagee or
lessor in the event of a mortgage foreclosure or deed in lieu thereof or
termination by such lessor. No further instrument of subordination or attornment
shall be required. Notwithstanding the foregoing, in confirmation of such
subordination or attornment, within fifteen (15) days after a written request
therefor, Tenant shall execute such further instruments as may be requested by
Lessor or any mortgagee or lessor. Any failure to do so shall be an Event of
Default pursuant to Section 26(h) hereof. Tenant hereby irrevocably appoints
Lessor as attorney-in-fact for Tenant with full power and authority to execute
and deliver in the name of Tenant any such instrument or instruments.
30. NOTICE. Any notice or document required or permitted to be delivered
hereunder shall be deemed to be delivered, whether actually received or not, on
the third (3rd) day of mail delivery following deposit of it in the United
States mail, postage prepaid, certified or registered mail, addressed to a Party
at the relevant address set forth below, or at such other address as such Party
shall have previously designated in written notice delivered in accordance with
this Section 30:
If to Lessor: If to Tenant:
LINDUE, LLC Northwest Teleproductions, Inc.
x/x Xxxxxxx & Xxxxxxx 0000 Xxxx 00xx Xxxxxx
Xxxxxxxxx at Law Xxxxx, Xxxxxxxxx 00000
0000 Xxxx Xxxxxxx Xxxxxxxxx Attention: Chief Financial Officer
Xxxxx 000
Xxxxxxx, Xxxxxxxxx 00000
With a copy to:
Xxxxxxxx Real Estate, Inc.
0000 Xxxxx Xxxxxx Xxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
Any notice or document required or permitted to be delivered hereunder also
shall be deemed to be delivered if and when delivered personally to either Party
at the above relevant address.
31. RULES AND REGULATIONS. Tenant shall observe such reasonable rules and
regulations which from time to time may be promulgated by Lessor in writing to
the Tenant for the general safety, comfort and convenience of Lessor, Tenant or
the Leased Premises.
32. FINANCIAL REPORTS. (a) Operating Plan; Financial Forecast. For each fiscal
year of Tenant that begins subsequent to March 31, 1999, the Board of Directors
of Tenant shall approve and deliver to Lessor an Operating Plan and Financial
Forecast of Tenant no later than thirty (30) days prior to the beginning of such
fiscal year.
(b) Monthly Financial Statements. Tenant shall provide to Lessor monthly
financial statements, forecasts (including without limitation reports of any
substantive changes to forecasts) and plans of Tenant at least as frequently and
timely as such are provided to the Board of Directors of Tenant.
(c) Attendance at Meetings. Lessor may at its sole discretion designate a
representative of Lessor to attend Tenant's Board of Directors meetings at which
any financial reports of Tenant shall be presented; Tenant shall give Lessor
notice of any such meetings at the same time it gives such notice to its
Directors.
33. This Section 33 left blank intentionally
34. BROKERAGE FEES. Each Party represents and warrants that it has dealt with no
broker, agent or other person in connection with this Lease, and each Party
shall indemnify, hold harmless and defend the other Party from and against any
claim or claims by any broker, agent or other person claiming a commission or
other form of compensation by virtue of having dealt with the indemnifying Party
with regard to this Lease.
35. This Section 35 left blank intentionally
36. This Section 36 left blank intentionally
37. MISCELLANEOUS TAXES. (a) Tenant shall pay prior to delinquency all taxes
assessed against or levied upon its occupancy of the Leased Premises or upon the
fixtures, furnishings, equipment or personal property of Tenant located in the
Leased Premises, and when possible Tenant shall cause said fixtures,
furnishings, equipment and personal property to be assessed and billed
separately from the property of Lessor. In the event any or all of Tenant's
fixtures, furnishings, equipment and personal property, or Tenant's occupancy of
the Leased Premises, shall be assessed and taxed with the property of Lessor,
Tenant shall pay to Lessor that portion of such taxes applicable to Tenant's
fixtures, furnishings, equipment or personal property, or occupancy of the
Leased Premises.
(b) If, under the laws of the United States or any state thereof or any
political subdivision in which the Leased Premises are situated, a tax or excise
on rents or other tax, however described, is levied or assessed against Lessor
or the Rent or any portion thereof, in addition to, in lieu of, or as a
substitute in whole or in part for taxes and assessments commonly known as real
estate taxes, then Tenant shall pay and discharge such tax or excise to the
extent of the amount thereof which is lawfully assessed or imposed upon Lessor
and which was so assessed or imposed as a direct result of the rental accruing
under this Lease.
38. ESTOPPEL CERTIFICATE. Tenant shall, within ten (10) days after request by
Lessor, deliver to Lessor or Lessor's designee (including, without limitation,
any prospective purchaser of the Leased Premises, or the present or any future
holder of any mortgages or deeds of trust or ground or underlying leases on the
Leased Premises) an estoppel certificate stating that this Lease is in full
force and effect, the date to which rent and other charges have been paid, the
unexpired term of this Lease, whether Lessor is in default hereunder, and the
nature of any such default, and such other matters pertaining to this Lease as
may be requested by Lessor.
39. WAIVER. Any failure of Lessor to insist upon strict performance of any term,
covenant or condition of this Lease, or to exercise any option herein contained
shall not be construed as a waiver or a relinquishment for the future of that or
any other term, covenant, condition or option, but the same shall continue and
remain in full force and effect. The receipt by Lessor of Rent with or without
knowledge of a breach in any terms, covenants or conditions of this Lease to be
kept or performed by Tenant shall not be deemed a waiver of such breach, and
Lessor shall not be deemed to have waived any provision of this Lease unless
expressed in writing and signed by Lessor.
40. SURRENDER. On the last day of the Lease Term or on the sooner termination
thereof, Tenant shall peaceably surrender the Leased Premises in good condition
and repair consistent with Tenant's duty to make repairs as provided in Section
14 hereof. On or before the last day of the Lease Term or on the sooner
termination thereof, Tenant shall at its expense remove all of Tenant's personal
property from the Leased Premises, and any property not removed shall be deemed
abandoned. Subject to the provisions of Section 15(b) of this Lease, all
alterations, additions and fixtures, which have been made or installed upon the
Leased Premises by either Lessor or Tenant shall remain as Lessor's property and
shall be surrendered with the Leased Premises as a part thereof. Tenant shall
surrender all keys in accordance with the provisions of subsection 17(c) of this
Lease.
41. MISCELLANEOUS.
(a) Successors and Assigns. The terms, provisions, covenants and conditions
contained in this Lease shall apply to, inure to the benefit of, and be binding
upon the Parties hereto and their respective legal representatives, successors
and permitted assigns, except as otherwise herein expressly provided.
(b) Interpretation. If any provision of this Lease is or becomes invalid or
unenforceable, the remainder of this Lease, or the application of such provision
to persons or circumstances other than those to which it is invalid or
unenforceable, shall not be affected thereby; and each provision of this Lease
shall be valid and be enforced to the fullest extent permitted by law.
(c) No agency. This Lease does not create the relationship of principal and
agent or of partnership or of joint venture or of any association between Lessor
and Tenant, the sole relationship between Lessor and Tenant being that of lessor
and lessee.
(d) Governing Law. This Lease shall be governed by and construed according
to the laws of the State of Minnesota.
(e) Titles. The section and subsection captions, headings or titles
appearing in this Lease are for convenience only and do not in any manner
define, limit, construe or describe any of the provisions of this Lease.
(f) Complete Agreement. This Lease shall supersede all negotiations or
other communications written or verbal regarding the terms and conditions of the
relationship between Lessor and Tenant created hereby, and there are no written
or oral agreements between Lessor and Tenant relating to the subject matter of
this Lease other than those expressed herein.
(g) Amendment. This Lease cannot be modified or amended except by an
agreement in writing signed by Lessor and Tenant.
(h) Exhibits. The Exhibits referred to in this Lease and attached hereto
are part of this Lease to the same extent and in the same manner as if the
provisions thereof were actually embodied in this Lease.
(i) Authority. Lessor warrants that it is a duly organized limited
liability company of the State of Minnesota, that its board of governors has
duly authorized execution of this Lease and performance of the obligations of
Lessor thereunder, and that nothing in this Lease is prohibited by or will cause
any breach or default in any loan agreement or other agreement or understanding
with any lender of Lessor. Tenant warrants that it is a duly incorporated
corporation of the State of Minnesota, that its board of directors has duly
authorized execution of this Lease and performance of the obligations of Tenant
thereunder, and that nothing in this Lease is prohibited by or will cause any
breach or default in any loan agreement or other agreement or understanding with
any lender of Tenant.
43. ENVIRONMENTAL. Tenant shall not, and shall not permit its employees, agents
or invitees to, use any portion of the Leased Premises for the purpose of
generating, transporting, storing, treating, releasing or disposing of any
pollutant, toxic or hazardous waste or substance, or any other material the
release or disposal of which is now or hereafter regulated by any local, state
or federal law, regulation, ordinance or code related to pollution or
environmental contamination. Tenant and its successors, assigns and sublessees,
if any, shall indemnify, hold harmless and defend Lessor and its successors and
assigns from and against any claim or damage of any person or entity in any way
arising out of or resulting from any breach of the provisions of this Section
43. Notwithstanding the foregoing, Lessor agrees that the prohibitions in this
paragraph shall not apply to substances used by Tenant in the operation of its
business so long as Tenant stores, uses and disposes of such substances in
accordance with applicable law.
IN WITNESS WHEREOF, Lessor and Tenant have executed this Lease Agreement on
the date first above written.
LESSOR: TENANT:
LINDUE, LLC NORTHWEST TELEPRODUCTIONS, INC.
By:_____________________________ By:____________________________________
Its:____________________________ Its:___________________________________
EXHIBIT A
The Premises
The building and improvements located upon the land legally described as
follows:
Legal Description Tract R, Registered Land Survey No. 1218, Files
of Registrar of Titles, County of Hennepin, Minnesota
EXHIBIT B
Schedule of Base Rent
0000 XXXX 00XX XXXXXX
BASE RENT
$ Per
Year Sq. Ft.
1st Year $10,224.33 / mo.
Through 3/99 6.135 $122,692 annual
2 $10,480.00 / mo.
6.288 $125,760 annual
3 $10,741.92 / mo.
6.445 $128,903 annual
4 $11,010.50 / mo.
6.606 $132,126 annual
5 $11,285.75 / mo.
6.771 $135,429 annual
6 $11,567.92 / mo.
6.941 $138,815 annual
7 $11,857.17 / mo.
7.114 $142,286 annual
8 $12,153.50 / mo.
7.292 $145,842 annual
TAX COSTS
First year $6,000 / mo.
(Total 0000 X. 00xx Xxxxxx
and 0000 X. 00xx Xxxxxx Leases)
OPERATING COSTS
First year $1,100 / mo.
(Total 0000 X. 00xx Xxxxxx
and 0000 X. 00xx Xxxxxx Leases)
EXHIBIT C
Operating Cost Exceptions
Operating Cost Exclusions. Notwithstanding anything to the contrary in the
definition of "Operating Costs" as set forth in Section 7of the Lease, Operating
Costs shall be defined so as to exclude the following:
(a) Costs incurred by Landlord for repairs, replacements and/or
restoration to or of the Building or Common Areas to the extent that
Landlord is reimbursed by insurance or condemnation proceeds or by
warrantors or other third persons;
(b) Attorneys' fees and other costs and expenses incurred in
connection with negotiations or disputes with prospective tenants of
the Building;
(c) Costs that must be capitalized by Landlord for federal income tax
purposes shall be deemed to be Operating Costs under the Lease only if
said costs (i) are amortized over the useful life of the improvement
(as estimated in good faith by Landlord); (ii) reduce Operating
Expenses, (iii) are incurred in order to comply with the requirements
of Landlord's insurance carrier, (iv) are incurred in order to comply
with any law, rule, regulation or order of any governmental authority,
or (v) are incurred to extend the life of or otherwise maintain or
replace a component of any improvements on the Land. Notwithstanding
the provisions of clause (i) of this subparagraph, if Landlord would
not have had to incur the cost in question but for Tenant's use of the
Premises (to the extent that such use is different from ordinary
office use), Landlord may amortize the cost in question over the
balance of the term of this Lease.
(d) Interest, on debt or amortization on any mortgage or mortgages
encumbering the Building except to the extent expressly provided for
in the Lease;
(e) Landlord's general overhead;
(f) Advertising and promotional expenditures;
(g) Repairs or replacements covered by warranties or guaranties to the
extent of service or payment thereunder;
(h) Damage and repairs necessitated by the negligence or willful
misconduct of Landlord or Landlord's employees, contractors or agents;
(i) Any charges that would result in Landlord collecting in excess of
one hundred percent (100%) of all Operating Expenses; and
