STANDARD OFFICE LEASE AGREEMENT (NET)
THIS LEASE AGREEMENT (hereinafter called the "Lease Agreement") made as of
the 3rd day of September, 1997 by and between NORTHLAND CENTER LIMITED
PARTNERSHIP, a Minnesota limited partnership having offices at Suite 100, 0000
Xxxx 00xx Xxxxxx, Xxxxxxxxxxx, Xxxxxxxxx, 00000 (hereinafter called the
"Landlord"), and HEALTH FITNESS CORPORATION, a Minnesota corporation
(hereinafter called the "Tenant").
WITNESSETH
FOR AND IN CONSIDERATION of the sum of One Dollar ($1.00) in hand paid by
each of the parties to the other, and other good and valuable consideration,
receipt and sufficiency of which is hereby acknowledged, Landlord does hereby
lease and let unto Tenant, and Tenant does hereby hire, lease and take from
Landlord, that area outlined in red on Exhibit A-1 attached hereto, and by this
reference incorporated herein, and described as Suites 35 and 50, containing
approximately 3,141 square feet (hereinafter called the "Premises") at 3500 and
0000 Xxxx 00xx Xxxxxx (hereinafter called the "Building") in the City of
Bloomington, County of Hennepin, State of Minnesota. The term Building as it is
used herein shall consist of the land and building(s) set forth in Exhibit A-2
hereto.
ARTICLE 1 - TERM
To have and to hold said Premises for a term of 46 months, commencing
October 1, 1997, and terminating July 31, 2001 (hereinafter called the "Term")
upon the rentals and subject to the conditions set forth in this Lease
Agreement, and the Exhibits attached hereto. The commencement and termination
dates are specifically subject to the provisions of Article 5 hereof.
ARTICLE 2 - USE
The Premises shall be used by the Tenant solely for the following purposes:
General Office Use.
ARTICLE 3 - RENTALS
Tenant agrees to pay to Landlord as minimum rental (hereinafter called
"Minimum Rental" for the Premises, without notice set-off or demand, the sum of
Two Thousand Six Hundred Seventeen and 00/100 Dollars ($2,617.00) per monthly
installments to be due and payable by Tenant in advance on the first day of each
calendar month during the Term of this Lease Agreement, or any extension or
renewal thereof, at the office of Landlord set forth in the preamble to this
Lease Agreement or at such other place as Landlord may designate. In the event
of any fractional calendar month, Tenant shall pay for each day in such partial
month a rental equal to 1/30 of the Minimum Rental. Tenant agrees to pay, as
Additional Rent, which shall be collectible to the same extent as Minimum
Rental, all amounts which may become due to Landlord hereunder and any tax,
charge or fee that may be levied, assessed or imposed upon or measured by the
rents reserved hereunder by any governmental authority acting under any present
or future law before any fine, penalty, interest or costs may be added thereto
for non-payment. Pursuant to Article 6 hereof, Landlord's estimated Operating
Expenses for 1997 are $6.34 per square foot and estimated Real Estate Taxes
payable in 1997 are $4.49 per square foot.
ARTICLE 4 - CONSTRUCTION
Plans and/or a description for permanent improvements to the Premises are
attached hereto as Exhibit A-3 and by this reference incorporated herein
(hereafter called the "Plans"). The Plans have been approved by each of Landlord
and Tenant. The parties acknowledge that the Plans are to modify the Premises to
accommodate Tenant's intended use. Landlord shall be responsible for
constructing the improvements as shown on the Plans (hereafter called "Tenant
Improvements") for and on behalf of Tenant. Landlord and Tenant have agreed that
the costs of such Tenant Improvements shall be paid by Tenant, although Landlord
shall provide Tenant an allowance of up to $38,698 to be utilized toward the
cost of the Tenant Improvements (hereafter called the "T.I. Allowance"). The
T.I. Allowance shall be used only for the payment of costs relating to the
construction of the Tenant Improvements (including the cost of preparing the
Plans), which costs Landlord shall pay directly out of the T.I. Allowance, for
the credit of Tenant, and in no event shall any part of the T.I. Allowance be
paid to or payable to Tenant. Any costs of the Tenant Improvements which exceed
the T.I. Allowance shall be paid by Tenant to Landlord without demand within
fifteen (15) days of the day of submission by Landlord to Tenant of a statement
of said costs. Any improvements to the Premises, other than as shown on the
Plans, and the furnishing of the Premises, shall be made by Tenant at the sole
cost and expense of Tenant, subject to all other provisions of this Lease
Agreement, including compliance with all applicable governmental laws,
ordinances and regulations. If the Tenant Improvements cannot be substantially
completed prior to the commencement of the Term, then the provisions of Article
5 shall apply.
ARTICLE 5 - POSSESSION
Except as otherwise provided, Landlord shall deliver possession of the
Premises on or before the date hereinabove specified for commencement of the
Term, but delivery of possession prior to such commencement date shall not
affect the expiration date of this Lease Agreement. Failure of Landlord to
deliver possession of the Premises by the date hereinabove provided, due to a
holding over by a prior tenant, or any other cause beyond Landlord's control, or
time required for construction delays due to material shortages, strikes, or
acts of God, shall automatically postpone the date of commencement of the Term
of this Lease Agreement and shall extend the termination date by periods equal
to those which shall have elapsed between and including the date hereinabove
specified for commencement of the Term hereof and the date on which possession
of the Premises is delivered to the Tenant. The rentals herein reserved shall
commence on the first day of the Term, provided, however, in the event of any
occupancy by Tenant prior to the beginning of the Term, such occupancy shall in
all respects be the same as that of a tenant under this Lease Agreement, and the
rental shall commence as of the date that Tenant enters into such occupancy of
the Premises. Provided further, that if Landlord shall be delayed in delivery of
the Premises to Tenant due to Tenant's failure to agree to the Plans or any
delay caused by a party employed by or the agent of Tenant, or by Tenant's
failure to pay for the costs of the Tenant Improvements in excess of the T.I.
Allowance, then in such case the rental shall be accelerated by the number of
days of such delay, and the rentals shall commence the same as if occupancy had
been taken by Tenant. Prior to the commencement of the Term, Landlord shall have
no responsibility or liability for loss of damage to fixtures, facilities or
equipment installed or left on the Premises. By occupying the Premises as a
Tenant, or to install fixtures, facilities or equipment, or to perform finishing
work, Tenant shall be conclusively deemed to have accepted the same and to have
acknowledged that the Premises are in the condition required by this Lease
Agreement, except items which are not in compliance with Exhibit A-3 and for
which Tenant has given Landlord a written "punch list" within thirty (30) days
of Tenant's first occupancy of the Premises. Should the commencement of the
rental obligations of Tenant under this Lease Agreement occur for any reason on
a day other than the first day of a calendar month, then in that event solely
for the purposes of computing the Term of this Lease Agreement, the commencement
date of the Term shall become and be the first day of the first full calendar
month following the date when Tenant's rental obligation commences, or the first
day of the first full calendar month following the commencement date set out in
Article 1 (if such is other than the first date of a calendar month), whichever
date is later, and the termination date shall be adjusted accordingly; provided,
however, that the termination date shall be the last day of a calendar month,
which date shall in no event be earlier than the termination date set out in
Article 1. Immediately after Tenant's occupancy of the Premises the Landlord and
Tenant shall execute a ratification agreement which shall set forth the final
commencement and termination dates for the Term and shall acknowledge the
Minimum Rental, the square footage of the Premises, and delivery of the Premises
in the condition required by this Lease Agreement.
ARTICLE 6 - TENANT'S PRO RATA SHARE OF REAL ESTATE TAXES AND OPERATING EXPENSES
A. During each full or partial calendar year during the Term of this Lease
Agreement, Tenant shall pay to Landlord, as Additional Rental, an amount equal
to the Real Estate Taxes and Operating Expenses (both as hereinafter defined)
per square foot of rentable area in the Building multiplied by the number of
square feet of rentable area in the Premises prorated for the period that Tenant
occupied the Premises. Notwithstanding the preceding sentence, Tenant's share of
the following Operating Expenses shall be computed on the basis of the cost of
said expenses per rentable square foot of area within the Building actually
occupied: cleaning, management, and energy expenses.
B. Landlord shall, each year during the Term of this Lease Agreement, give
Tenant an estimate of Operating Expenses and Real Estate Taxes payable per
square foot of rentable area for the coming calendar year. Tenant shall pay, as
Additional Rental, along with its monthly Minimum Rental payments required
hereunder, one-twelfth (1/12) of such estimated Operating Expenses and Real
Estate Taxes and such Additional Rental shall be payable until subsequently
adjusted for the following year pursuant to this Article.
C. As soon as possible after the expiration of each calendar year, Landlord
shall determine and certify to Tenant the actual Operating Expenses and Real
Estate Taxes for the previous year per square foot of rentable area in the
Building and the amount applicable to the Premises. If such statement shows that
Tenant's share of Operating Expenses and Real Estate Taxes exceeds Tenant's
estimated monthly payments for the previous calendar year, then Tenant shall,
within twenty (20) days after receiving Landlord's certification, pay such
deficiency to Landlord. In the event of an overpayment by Tenant, such
overpayment shall be refunded to Tenant, at the time of certification, in the
form of an adjustment in the Additional Rental next coming due, or if at the end
of the Term by a refund.
D. For the purposes of this Article, the term "Real Estate Taxes" means the
total of all taxes, fees, charges and assessments, general and special, ordinary
and extraordinary, foreseen or unforeseen, which become due or payable upon the
Building. All costs and expenses incurred by Landlord during negotiations for or
contests of the amount of Real Estate Taxes shall be included within the term
"Real Estate Taxes." For purposes of this Article, the term "Operating Expenses"
shall be deemed to mean all costs and expenses directly related to the Building
incurred by Landlord in the repair, operation, management and maintenance of the
Building including interior and exterior and common area maintenance, management
fees, cleaning expenses, energy expenses, insurance premiums, and the
amortization of capital investments made to reduce operating costs or that are
necessary due to governmental requirements, all in accordance with generally
accepted accounting principles.
E. Landlord may at any time designate a fiscal year in lieu of a calendar
year and in such event, at the time of such a change, there may be a billing for
the fiscal year which is less than 12 calendar months.
F. Landlord reserves, and Tenant hereby assigns to Landlord, the sole and
exclusive right to contest, protest, petition for review, or otherwise seek a
reduction in the Real Estate Taxes.
ARTICLE 7 - UTILITIES AND SERVICE
A. Landlord agrees to furnish water, electricity, elevator service, and
janitorial service. In the event Tenant's requirements and/or usage of such
utilities and services is substantially greater than is customarily supplied to
a typical tenant in the Building, Landlord or Tenant may request that the
difference in such requirement and/or usage be determined and that appropriate
adjustments be made in the Minimum Rental provided for in Article 3 of this
Lease Agreement.
B. Landlord agrees to furnish heat during the usual heating season and air
conditioning during the usual air conditioning season, all during normal
business hours as defined in this Lease Agreement.
C. No temporary interruption or failure of such services incidental to the
making of repairs, alterations or improvements, or due to accidents or strike or
conditions or events not under Landlord's control, shall be deemed as an
eviction of the Tenant or relieve the Tenant from any of the Tenant's
obligations hereunder.
D. For the purposes of this Article 7, normal business hours shall be
deemed to mean the period of time between 8:00 a.m. and 5:00 p.m., Monday
through Friday, and specifically excluding Saturdays, Sundays and legal
holidays.
ARTICLE 8 - NON-LIABILITY OF LANDLORD
Except in the event of negligence of Landlord, its agents, employees or
contractors, Landlord shall not be liable for any loss or damage for failure to
furnish heat, air conditioning, electricity, elevator service, water, sprinkler
system or janitorial service. Landlord shall not be liable for personal injury,
death or any damage from any cause about the Premises or the Building except if
caused by Landlord's gross negligence.
ARTICLE 9 - CARE OF PREMISES
A. Tenant agrees:
1. To keep the Premises in as good condition and repair as they were in
at the time Tenant took possession of same, reasonable wear and tear
and damage from fire and other casualty for which insurance is
normally procured excepted;
2. To keep the Premises in a clean and sanitary condition;
3. Not to commit any nuisance or waste on the Premises, overload the
Premises or the electrical, water and/or plumbing facilities in the
Premises or Building, throw foreign substances in plumbing facilities,
or waste any of the utilities furnished by Landlord;
4. To abide by such rules and regulations as may from time to time be
reasonably promulgated by Landlord;
5. To preserve and protect all carpeted areas and to provide and use
carpet protector mats in all locations within the Premises where
chairs with castors are used; and
6. To obtain Landlord's prior approval of the interior design of any
portion of the Premises visible from the common areas or from the
outside of the Building. "Interior design" as used in the preceding
sentence shall include but not be limited to floor and wall coverings,
furniture, office design, artwork and color scheme.
B. If Tenant shall fail to keep and preserve the Premises in the state of
condition required by the provisions of this Article 9, the Landlord may at its
option put or cause the same to be put into the condition and state of repair
agreed upon, and in such case the Tenant, on demand, shall pay the cost thereof.
ARTICLE 10 - NON-PERMITTED USE
Tenant agrees to use the Premises only for the purposes set forth in
Article 2 hereof. Tenant further agrees not to commit or permit any act to be
performed on the Premises or any omission to occur which shall be in violation
of any statute, regulation or ordinance of any governmental body or which will
increase the insurance rates on the Building or which will be in violation of
any insurance policy carried on the Building by the Landlord. Tenant, at its
expense, shall comply with all governmental laws, ordinances, rules and
regulations applicable to the use of the Premises and its occupancy and shall
promptly comply with all governmental orders, rulings and directives for the
correction, prevention and abatement of any violation upon, or in connection
with the Premises or Tenant's use or occupancy of the Premises, including the
making of any alterations or improvements to the Premises, all at Tenant's sole
cost and expense. The Tenant shall not disturb other occupants of the Building
by making any undue or unseemly noise or otherwise and shall not do or permit to
be done in or about the Premises anything which will be dangerous to life or
limb.
ARTICLE 11 - INSPECTION
The Landlord or its employees or agents shall have the right without any
diminution of rent or other charges payable hereunder by Tenant to enter the
Premises at all reasonable times for the purpose of exhibiting the Premises to
prospective tenants or purchasers, inspection, cleaning, repairing, testing,
altering or improving the same or said Building, but nothing contained in this
Article shall be construed so as to impose any obligation on the Landlord to
make any repairs, alterations or improvements.
ARTICLE 12 - ALTERATIONS
Tenant will not make any alterations, repairs, additions or improvements in
or to the Premises or add, disturb or in any way change any plumbing, wiring,
life/safety or mechanical systems, locks, or structural components of the
Building without the prior written consent of the Landlord as to the character
of the alterations, additions or improvements to be made, the manner of doing
the work, and the contractor doing the work. Such consent shall not be
unreasonably withheld or delayed, if such alterations, repairs, additions or
improvements are required of Tenant or are the obligation of Tenant pursuant to
this Lease Agreement. Such consent shall not be unreasonably withheld or
delayed, if such alterations, repairs, additions or improvements are required of
Tenant or are the obligation of Tenant pursuant to this Lease Agreement. All
such work shall comply with all applicable governmental laws, ordinances, rules
and regulations. The Landlord as a condition to said consent may require a
surety performance and/or payment bond from the Tenant for said actions. Tenant
agrees to indemnify and hold Landlord free and harmless from any liability,
loss, cost, damage or expense (including attorney's fees) by reasons of any said
alteration, repair, additions or improvements.
ARTICLE 13 - SIGNS
Tenant agrees that no signs or other advertising materials shall be
erected, attached or affixed to any portion of the interior or exterior of the
Premises or the Building without the express prior written consent of Landlord.
ARTICLE 14 - COMMON AREAS
A. Tenant agrees that the use of all corridors, passageways, elevators,
toilet rooms, parking areas and landscaped area in and around said Building, by
the Tenant or Tenant's employees, visitors or invitees, shall be subject to such
rules and regulations as may from time to time be made by Landlord for the
safety, comfort and convenience of the owners, occupants, tenants and invitees
of said Building. Tenant agrees that no awnings, curtains, drapes or shades
shall be used upon the Premises except as may be approved by Landlord.
B. In addition to the Premises, Tenant shall have the right of
non-exclusive use, in common with others, of (a) all unrestricted automobile
parking areas, driveways and walkways, and (b) loading facilities, freight
elevators and other facilities as may be constructed in the Building, all to be
subject to the terms and conditions of this Lease Agreement and to reasonable
rules and regulations for the use thereof as prescribed from time to time by
Landlord.
C. Landlord shall have the right to make changes or revisions in the site
plan and in the Building so as to provide additional leasing area. Landlord
shall also have the right to construct additional buildings on the land
described on Exhibit A-2 for such purposes as Landlord may deem appropriate.
Landlord also reserves all airspace rights above, below and to all sides of the
Premises, including the right to make changes, alterations or provide additional
leasing areas.
D. Landlord and Tenant agree that Landlord will not be responsible for any
loss, theft or damage to vehicles, or the contents thereof, parked or left in
the parking areas of the Building and Tenant agrees to so advise its employees,
visitors or invitees who may use such parking areas. The parking areas shall
include those areas designated by Landlord, in its sole discretion, as either
restricted or unrestricted parking areas. Any restricted parking areas shall be
leased only by separate license agreement with Landlord. Tenant further agrees
not to use or permit its employees, visitors or invitees to use the parking
areas for overnight storage of vehicles.
ARTICLE 15 - ASSIGNMENT AND SUBLETTING
A. Tenant agrees not to assign, sublet, license, mortgage or encumber this
Lease Agreement, the Premises, or any part thereof, whether by voluntary act,
operation of law, or otherwise, without the specific prior written consent of
Landlord in each instance. If Tenant is a corporation or a partnership, transfer
of a controlling interest of Tenant shall be considered an assignment of this
Lease Agreement for purposes of this Article. Consent by Landlord in one such
instance shall not be a waiver of Landlord's rights under this Article as to
requiring consent for any subsequent instance. In the event Tenant desires to
sublet a part or all of the Premises, or assign this Lease Agreement, Tenant
shall give written notice to Landlord at least thirty (30) days prior to the
proposed subletting or assignment, which notice shall state the name of the
proposed subtenant or assignee, the terms of any sublease or assignment
documents and copies of financial reports or other relevant financial
information of the proposed subtenant or assignee. At Landlord's option, any and
all payments by the proposed assignee or sublessee with respect to the
assignment of sublease shall be paid directly to Landlord. In any event no
subletting or assignment shall release Tenant of its obligation to pay the rent
and to perform all other obligations to be performed by Tenant hereunder for the
Term of this Lease Agreement. The acceptance of rent by Landlord from any other
person shall not be deemed to be a waiver by Landlord of any provision hereof.
At Landlord's option, Landlord may terminate the Lease Agreement in lieu of
giving its consent to any proposed assignment of this Lease Agreement or
subletting of the Premises (which termination may be contingent upon the
execution of a new lease with the proposed assignee or subtenant).
B. Landlord's right to assign this Lease Agreement is and shall remain
unqualified upon any sale or transfer of the Building and, providing the
purchaser succeeds to the interests of Landlord under this Lease Agreement,
Landlord shall thereupon be entirely freed of all obligations of the Landlord
hereunder and shall not be subject to any liability resulting from any act or
omission or event occurring after such conveyance.
ARTICLE 16 - LOSS BY CASUALTY
If the Building is damaged or destroyed by fire or other casualty, the
Landlord shall have the right to terminate this Lease Agreement, provided it
gives written notice thereof to the Tenant within ninety (90) days after such
damage or destruction. If a portion of the Premises is damaged by fire or other
casualty, and Landlord does not elect to terminate this Lease Agreement, the
Landlord shall, at its expense, restore the Premises to as near the condition
which existed immediately prior to such damage or destruction, as reasonably
possible, and the rentals shall xxxxx during such period of time as the Premises
are untenantable, in the proportion that the untenantable portion of the
Premises bears to the entire Premises.
ARTICLE 17 - WAIVER OF SUBROGATION
Landlord and Tenant hereby release the other 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 to property caused by fire or
any of the extended coverage or supplementary contract casualties, even if such
fire or other casualty shall have been caused by the fault or negligence of the
other party, or anyone for whom such party may be responsible, provided however,
that this release shall be applicable and in force and effect only with respect
to loss or damage occurring during such times as the releasing party's policies
shall contain a clause or endorsement to the effect that any such release would
not adversely affect or impair said policies or prejudice the right of the
releasing party to recover thereunder. Landlord and Tenant agree that they will
request their insurance carriers to include in their policies such a clause or
endorsement. If extra cost shall be charged therefore, each party shall advise
the other of the amount of the extra cost, and the other party, at its election,
may pay the same, but shall not be obligated to do so.
ARTICLE 18 - EMINENT DOMAIN
If the entire Building is taken by eminent domain, this Lease Agreement
shall automatically terminate as of the date of taking. If a portion of the
Building is taken by eminent domain, the Landlord shall have the right to
terminate this Lease Agreement, provided it gives written notice thereof to the
Tenant within ninety (90) days after the date of taking. If a portion of the
Premises is taken by eminent domain and this Lease Agreement is not terminated
by Landlord, the Landlord shall, at its expense, restore the Premises to as near
the condition which existed immediately prior to the date of taking as
reasonably possible, and the rentals shall xxxxx during such period of time as
the Premises are untenantable, in the proportion that the untenantable portion
of the Premises bears to the entire Premises. All damages awarded for such
taking under the power of eminent domain shall belong to and be the sole
property of Landlord, irrespective of the basis upon which they are awarded,
provided, however, that nothing contained herein shall prevent Tenant from
making a separate claim to the condemning authority for its moving expenses and
trade fixtures. For purposes of this Article, a taking by eminent domain shall
include Landlord's giving of a deed under threat of condemnation.
ARTICLE 19 - SURRENDER
On the last day of the Term of this Lease Agreement or on the sooner
termination thereof in accordance with the terms hereof, Tenant shall peaceably
surrender the Premises in good condition and repair consistent with Tenant's
duty to make repairs as provided in Article 9 hereof. On or before said last
day, Tenant shall at its expense remove all of its equipment from the Premises,
repairing any damage caused thereby, and any property not removed shall be
deemed abandoned. All alterations, additions and fixtures other than Tenant's
trade fixtures, which have been made or installed by either Landlord or Tenant
upon the Premises shall remain as Landlord's property and shall be surrendered
with the Premises as a part thereof, or shall be removed by Tenant, at the
option of Landlord, in which event Tenant shall at its expense repair any damage
caused thereby. It is specifically agreed that any and all telephonic, coaxial,
ethernet, or other computer, word processing, facsimile, or electronic wiring
installed by Tenant within the Premises (hereafter "Wiring") shall be removed at
Tenant's cost at the expiration of the Term, unless Landlord has specifically
requested in writing that said Wiring shall remain, whereupon said Wiring shall
be surrendered with the Premises as Landlord's property. If the Premises are not
surrendered at the end of the Term or the sooner termination thereof, Tenant
shall indemnify Landlord against loss or liability resulting from delay by
Tenant in so surrendering the Premises, including, without limitation, claims
made by any succeeding tenant founded on such delay. Tenant shall promptly
surrender all keys for the Premises to Landlord at the place then fixed for
payment of rental and shall inform Landlord of combinations on any locks and
safes on the Premises.
ARTICLE 20 - NON-PAYMENT OF RENT, DEFAULTS
If any one or more of the following occurs: (1) a rent payment or any other
payment due from Tenant to Landlord shall be and remain unpaid in whole or in
part for more than ten (10) days after same is due and payable; (2) Tenant shall
violate or default on any of the other covenants, agreements, stipulations or
conditions herein, or in any parking agreement(s) or other agreements between
Landlord and Tenant relating to the Premises, and such violation or default
shall continue for a period of ten (10) days after written notice from Landlord
of such violation or default; (3) if Tenant shall commence or have commenced
against Tenant proceedings under a bankruptcy, receivership, insolvency or
similar type of action; or (4) if Tenant shall vacate any substantial portion of
the Premises for a period of more than 15 days; then it shall be optional for
Landlord, without further notice or demand, to cure such default or to declare
this Lease Agreement forfeited and the said Term ended, or to terminate only
Tenant's right to possession of the Premises, and to re-enter the Premises, with
or without process of law, using such force as may be necessary to remove all
persons or chattels therefrom, and Landlord shall not be liable for damages by
reason of such re-entry or forfeiture; but notwithstanding re-entry by Landlord
or termination only of Tenant's right to possession of the Premises, the
liability of Tenant for the rent and all other sums provided herein shall not be
relinquished or extinguished for the balance of the Term of this Lease Agreement
and Landlord shall be entitled to periodically xxx Tenant for all sums due under
this Lease Agreement or which become due prior to judgment, but such suit shall
not bar subsequent suits for any further sums coming due thereafter. Tenant
shall be responsible for, in addition to the rentals and other sums agreed to be
paid hereunder, the cost of any necessary maintenance, repair, restoration,
reletting (including related cost of removal or modification of tenant
improvements) or cure as well as reasonable attorney's fees incurred or awarded
in any suit or action instituted by Landlord to enforce the provisions of this
Lease Agreement, regain possession of the Premises, or the collection of the
rentals due Landlord hereunder. Tenant shall also be liable to Landlord for the
payment of a late charge in the amount of 10% of the rental installment or other
sum due Landlord hereunder if said payment has not been received within ten (10)
days from the date said payment becomes due and payable, or cleared by
Landlord's bank within three (3) business days after deposit. Tenant agrees to
pay interest at the highest permissible rate of interest allowed under the usury
statutes of the State of Minnesota, or in case no such maximum rate of interest
is provided, at the rate of 12% per annum, on all rentals and other sums due
Landlord hereunder not paid within ten (10) days from the date same become due
and payable. Each right or remedy of Landlord provided for in this Lease
Agreement shall be cumulative and shall be in addition to every other right or
remedy provided for in this Lease Agreement now or hereafter existing at law or
in equity or by statute or otherwise.
ARTICLE 21 - LANDLORD'S DEFAULT
Landlord shall not be deemed to be in default under this Lease Agreement
until Tenant has given Landlord written notice specifying the nature of the
default and Landlord does not cure such default within thirty (30) days after
receipt of such notice or within such reasonable time thereafter as may be
necessary to cure such default where such default is of such a character as to
reasonably require more than thirty (30) days to cure.
ARTICLE 22 - HOLDING OVER
Tenant will, at the expiration of this Lease Agreement, whether by lapse of
time or termination, give up immediate possession to Landlord. If Tenant fails
to give up possession the Landlord may, at its option, serve written notice upon
Tenant that such holdover constitutes any one of (i) renewal of this Lease
Agreement for one year, and from year to year thereafter, or (ii) creation of a
month-to-month tenancy, or (iii) creation of a tenancy at sufferance. If
Landlord does not give said notice, Tenant's holdover shall create a tenancy at
sufferance. In any such event the tenancy shall be upon the terms and conditions
of this Lease Agreement, except that the Minimum Rental shall be double the
Minimum Rental Tenant was obligated to pay Landlord under this Lease Agreement
immediately prior to termination (in the case of tenancy at sufferance such
Minimum Rental shall be prorated on the basis of a 365 day year for each day
Tenant remains in possession); excepting further that in the case of a tenancy
at sufferance, no notices shall be required prior to commencement of any legal
action to gain repossession of the Premises. In the case of a tenancy at
sufferance, Tenant shall also pay to Landlord all damages sustained by Landlord
resulting from retention of possession by Tenant. The provisions of this
paragraph shall not constitute a waiver by Landlord of any right of re-entry as
otherwise available to Landlord; nor shall receipt of any rent or any other act
in apparent affirmance of the tenancy operate as a waiver of the right to
terminate this Lease Agreement for a breach by Tenant hereof.
ARTICLE 23 - SUBORDINATION
Tenant agrees that this Lease Agreement shall be subordinate to any
mortgage(s) that may now or hereafter be placed upon the Building or any part
thereof, and to any and all advances to be made thereunder, and to the interest
thereon, and all renewals, replacements, and extensions thereof, provided the
mortgagee named in such mortgage(s) shall agree to recognize this Lease
Agreement or Tenant in the event of foreclosure provided the Tenant is not in
default. In confirmation of such subordination, Tenant shall promptly execute
and deliver any instrument, in recordable form, as required by Landlord's
mortgagee. In the event of any mortgagee electing to have the Lease Agreement a
prior incumbrance to its mortgage, then and in such event upon such mortgagee
notifying Tenant to that effect, this Lese Agreement shall be deemed prior to
incumbrance to the said mortgage, whether this Lease Agreement is dated prior to
or subsequent to the date of said mortgage.
ARTICLE 24 - INDEMNITY, INSURANCE AND SECURITY
A. Tenant will keep in force at its own expense for so long as this Lease
Agreement remains in effect public liability insurance with respect to the
Premises in which Landlord shall be named as an additional insured, in companies
and in form acceptable to Landlord with a minimum combined limit of liability of
Two Million Dollars ($2,000,000.00). This limit shall apply per location. Said
insurance shall also provide for contractual liability coverage by endorsement.
Tenant shall further provide for business interruption insurance to cover a
period of not less than six (6) months. Tenant will further deposit with
Landlord the policy or policies of such insurance or certificate thereof, or
other acceptable evidence that such insurance is in effect, which evidence shall
provide that Landlord shall be notified in writing thirty (30) days prior to
cancellation, material change, or failure to renew the insurance. Tenant further
covenants and agrees to indemnify and hold Landlord and Landlord's manager of
the Building harmless for any claim, loss or damage, including reasonable
attorney's fees, suffered by Landlord, Landlord's manager or Landlord's other
tenants caused by: i) any act or omission by Tenant, Tenant's employees or
anyone claiming through or by Tenant in, at, or around the Premises or the
Building; ii) the conduct or management of any work or thing whatsoever done by
Tenant in or about the Premises; or iii) Tenant's failure to comply with any and
all governmental laws, rules, ordinances or regulations applicable to the use of
the Premises and its occupancy. If Tenant shall not comply with its covenants
made in this Article 24, Landlord may, at its option, cause insurance as
aforesaid to be issued and in such event Tenant agrees to pay the premium for
such insurance promptly upon Landlord's demand.
B. Tenant shall be responsible for the security and safeguarding of the
Premises and all property kept, stored or maintained in the Premises. Landlord
will make available to Tenant, at Tenant's request, the plans and specifications
for construction of the Building and the Premises. Tenant represents that it is
satisfied that the construction of the Building and the Premises, including the
floors, walls, windows, doors and means of access thereto are suitable for the
particular needs of Tenant's business. Tenant further represents that it is
satisfied with the security of said Building and Premises for the protection of
any property which may be owned, held, stored or otherwise caused or permitted
by Tenant to be present upon the Premises. The placement and sufficiency of all
safes, vaults, cash or security drawers, cabinets or the like placed upon the
Premises by Tenant shall be at the sole responsibility and risk of Tenant.
Tenant shall maintain in force throughout the Term, insurance upon all contents
of the Premises, including that owned by others and Tenant's equipment and any
alterations, additions, fixtures, or improvements in the Premises acknowledged
by Landlord to be the Tenant's.
C. Landlord shall carry and cause to be in full force and effect a fire and
extended coverage insurance policy on the Building, but not contents owned,
leased or otherwise in possession of Tenant. The cost of such insurance shall be
an Operating Expense.
ARTICLE 25 - NOTICES
All notices from Tenant to Landlord required or permitted by any provisions
of this Lease Agreement shall be directed to Landlord postage prepaid, certified
or registered mail, at the address provided for Landlord in the preamble to this
Lease Agreement or at such other address as Tenant shall be advised to use by
Landlord. All notices from Landlord to Tenant required or permitted by any
provision of this Lease Agreement shall be directed to Tenant, postage prepaid,
certified or registered mail, at the Premises and at the address, if any, set
forth on page 6 of this Lease Agreement. Landlord and Tenant shall each have the
right any time and from time to time to designate one (1) additional party to
whom copies of any notice shall be sent.
ARTICLE 26 - APPLICABLE LAW
This Lease Agreement shall be construed under the laws of the State of
Minnesota.
ARTICLE 27 - MECHANICS' LIEN
In the event any mechanic's lien shall at any time be filed against the
Premises or any part of the Building by reason of work, labor, services or
materials performed or furnished to Tenant or to anyone holding the Premises
through or under Tenant, Tenant shall forthwith cause the same to be discharged
of record. If Tenant shall fail to cause such lien forthwith to be discharged
within five (5) days after being notified of the filing thereof, then, in
addition to any other right or remedy of Landlord, Landlord may, but shall not
be obligated to, discharge the same by paying the amount claimed to be due, or
by bonding, and the amount so paid by Landlord and all costs and expenses,
including reasonable attorney's fees incurred by Landlord in procuring the
discharge of such lien, shall be due and payable in full by Tenant to Landlord
on demand.
ARTICLE 28 - SECURITY INTEREST
Tenant hereby grants to Landlord a security interest in all goods,
chattels, fixtures and personal property belonging to Tenant, which now are or
may hereafter be placed in the Premises, to secure all rents due hereunder and
all other covenants and obligations of Tenant hereunder. In the event there
exists any security interest in said property which security interest is
paramount and superior to the security interest herein created, Landlord may
satisfy said paramount security interest and all sums paid in satisfying said
security interest will be considered additional sums owed Landlord by Tenant
hereunder. Tenant hereby acknowledges receipt of a true, full and complete copy
of this Lease Agreement. Landlord, in the event of a default by Tenant of any
covenant or condition herein contained, may exercise, in addition to any rights
and remedies herein granted, all the rights and remedies of a secured party
under the Uniform Commercial Code or any other applicable law. Tenant agrees
upon request of Landlord to execute and deliver to Landlord a financing
statement evidencing such security interest. A copy of this Lease Agreement may
be filed as a financing statement.
ARTICLE 29 - BROKERAGE
Each of the parties represents and warrants that there are no claims for
brokerage commissions or finder's fees in connection with this Lease Agreement,
and agrees to indemnify the other against, and hold it harmless from all
liabilities arising from any such claim, including without limitation, the cost
of attorney's fees in connection therewith.
ARTICLE 30 - SUBSTITUTION
Landlord reserves the right, on thirty (30) days written notice to Tenant,
to substitute other premises within the Building for the Premises hereunder. The
substituted premises shall contain substantially the same square footage as the
Premises, shall contain comparable improvements, and the Minimum Rental shall
not exceed the Minimum Rental specified in Article 3 hereof.
ARTICLE 31 - ESTOPPEL CERTIFICATES
Each party hereto agrees that at any time, and from time to time during the
Term of this Lease Agreement (but not more often than twice in each calendar
year), within ten (10) days after request by the other party hereto, it will
execute, acknowledge and deliver to such other party or to any prospective
purchaser, assignee or mortgagee designated by such other party, an estoppel
certificate in a form acceptable to Landlord. Tenant agrees to provide Landlord
(but not more often than twice in any calendar year), within ten (10) days of
request, the then most current financial statements of Tenant and any guarantors
of this Lease Agreement, which shall be certified by Tenant, and if available,
shall be audited and certified by a certified public accountant. Landlord shall
keep such financial statements confidential, except Landlord shall, in
confidence, be entitled to disclose such financial statements to existing or
prospective mortgagees or purchasers of the Building.
ARTICLE 32 - GENERAL
This Lease Agreement does not create the relationship of principal and
agent or of partnership or of joint venture or of any association between
Landlord and Tenant, the sole relationship between Landlord and Tenant being
that of landlord and tenant. No waiver of any default of Tenant hereunder shall
be implied from any omission by Landlord to take any action on account of such
default if such default persists or is repeated, and no express waiver shall
affect any default other than the default specified in the express waiver and
that only for the time and to the extent therein stated. The covenants of Tenant
to pay the Minimum Rental and the Additional Rental are each independent of any
other covenant, condition, or provision contained in this Lease Agreement. The
marginal or topical headings of the several Articles, paragraphs and clauses are
for convenience only and do not define, limit or construe the contents of such
Articles, paragraphs or clauses. All preliminary negotiations are merged into
and incorporated in this Lease Agreement. This Lease Agreement can only be
modified or amended by an agreement in writing signed by the parties hereto. All
provisions hereof shall be binding upon the heirs, successors and assigns of
each party hereto. If any term or provision of this Lease Agreement shall to any
extent be held invalid or unenforceable, the remainder shall not be affected
thereby, and each other term and provision of this Lease Agreement shall be
valid and be enforced to the fullest extent permitted by law. If Tenant is a
corporation, each individual executing this Lease Agreement on behalf of said
corporation represents and warrants that he is duly authorized to execute and
delivery this Lease Agreement on behalf of said corporation in accordance with a
duly adopted resolution of the Board of Directors of said corporation or in
accordance with the Bylaws of said corporation, and that this Lease Agreement is
binding upon said corporation in accordance with its terms. No receipt or
acceptance by Landlord from Tenant of less than the monthly rent herein
stipulated shall be deemed to be other than a partial payment on account for any
due and unpaid stipulated rent; no endorsement or statement of any check or any
letter or other writing accompanying any check or payment of rent to Landlord
shall be deemed an accord and satisfaction, and Landlord may accept and
negotiate such check or payment without prejudice to Landlord's rights to (i)
recover the remaining balance of such unpaid rent or (ii) pursue any other
remedy provided in this Lease Agreement. (Neither party shall record this Lease
Agreement or any memorandum thereof, and any such recordation shall be a breach
of this Lease Agreement void, and without effect.) Time is of the essence with
respect to the due performance of the terms, covenants and conditions herein
contained. Submission of this instrument for examination does not constitute a
reservation of or option for the Premises, and this Lease Agreement shall become
effective only upon execution and delivery thereof by Landlord and Tenant.
ARTICLE 33 - EXCULPATION
Tenant agrees to look solely to Landlord's interest in the Building for the
recovery of any judgment from Landlord, it being agreed that Landlord and
Landlord's partners, whether general or limited (if Landlord is a partnership)
or its directors, officers or shareholders (if Landlord is a corporation), shall
never be personally liable for any such judgment.
IN WITNESS WHEREOF, this Lease Agreement has been duly executed by the
parties hereto as of the day and year indicated above.
Address for Notices, if other than the Premises:
TENANT: LANDLORD:
Health Fitness Corporation, NORTHLAND CENTER LIMITED
A Minnesota corporation PARTNERSHIP,
By: The Northland Company, its Managing
General Partner
By: /s/ Xxxxx Xxxxx By: /s/ Xxxxx Xxxxx
Xxxxx Xxxxx Xxxxx Xxxxx
Its: Chief Executive Officer Its: Assistant Secretary
By: By:
Its Its:
Date: Date: 09/11/97
