EXHIBIT 10.3
LEASE AGREEMENT
THIS LEASE AGREEMENT is made this 13th day of March , 1997, by
and between AG PARK, L.L.C., a North Dakota limited liability company
("Landlord") and AGSCO, INC., a North Dakota corporation ("Tenant").
1. PREMISES. Landlord, in consideration of the rents and covenants
hereinafter mentioned, to be paid and performed by Tenant, does hereby demise,
lease and let unto Tenant, and Tenant does hereby hire and take from Landlord
those certain premises including all buildings, equipment, land and improvements
on the real property legally described as follows:
A tract of land located in the NE 1/4 of Section 23, in
Township 157 North, of Range 53 West;
Beginning at a point 100 ft. South and 1,200 ft. East of the
Northwest Corner of said Northeast Quarter; thence South
parallel with the West section line of said Northeast
Quarter a distance of 421.5 ft.; thence East parallel with
the North line of said quarter a distance of 200 ft.; thence
North parallel with the West line of said quarter a distance
of 421.5 ft.; thence West parallel to the North line of said
quarter a distance of 200 ft. to the point of beginning,
provided, however, that the northerly 40 ft. of said
property is hereby reserved to the public for street
purposes, but in the event said 40 ft. strip is not used for
street purposes within a period of 10 years from September
24, 1976, said 40 ft. strip shall revert to the Vendee as
its property absolutely (XXXXX COUNTY, ND).
2. TERMS. The term of this Lease shall be for a term of 15 years (180
months) commencing on the 1st day of January , 1997, (the
"Commencement Date") and terminating 15 years from date, unless sooner
terminated or further extended as herein provided. The term "Lease Year", as
used herein, shall mean the twelve (12) month period beginning with the
Commencement Date, or the first day of the first full month of the term if the
Commencement Date is other than the first day of a month, and each successive
twelve-month period thereafter during the term of this Lease.
3. RENEWAL. Provided Tenant is not then in default under any of the
terms of this Lease, Tenant shall have the right, at its option, to renew the
term of this Lease under the same terms, conditions and rentals as provided
herein for five (5) consecutive periods of five (5) years each. To exercise any
renewal option, Tenant must notify Landlord in writing of Tenant's election to
so renew not later than ninety (90) days prior to the end of the initial term or
due date of the last monthly lease payment.
Ex. 10.3 - 1
4. RENT. Tenant shall pay Landlord during the term of this Lease, Annual
Minimum Rent payable in equal monthly installments, on or before the first day
of each month in advance, at the office of Landlord or at such other place
designated by Landlord without prior demand therefor. In the event that the
Commencement Date occurs on a date other than the first day of a month, rent for
a period from the Commencement Date to the first day of the first Lease Year
shall be paid on a prorated basis.
4.1. MONTHLY RENT. Monthly Minimum Rent (1/12th of Annual Minimum
Rant) shall be in the amount of One Thousand Three Hundred ($1,300.00)
Dollars per month during the first year.
4.2. RENTAL ADJUSTMENTS. The Annual Minimum Rent referenced in
paragraph 4 above and payable under paragraph 4.1 above shall be
reappraised annually, in advance of the annual anniversary of the
Commencement Date, by agreement between the parties for the ensuing rental
period. In the event the parties are unable to agree upon such reappraisal
then each of the parties shall select one arbitrator and the two
arbitrators so selected shall select a third arbitrator and the three
arbitrators so selected shall fix and determine the rent to be paid by the
Tenant to the Landlord for the ensuing rental period. The annual
reappraisal of the Annual Minimum Rent shall be addressed in this Lease by
the attached Addendum executed by the parties.
5. CONDITION AND USE OF PREMISES. Tenant shall use the Premises for
storage and marketing of agricultural fertilizer, seed, and chemical products.
Tenant shall not use the Premises for any unlawful purposes and Tenant shall
further comply with such lawful requirements of the State, municipal or public
authorities which relate to the use and occupancy of the Premises, but Tenant
shall not be required to make any alterations, additions or improvements to the
Premises unless the same are required by the nature of Tenant's occupancy or the
terms of this Lease. The Premises is being delivered to Tenant in "AS IS"
condition, with all faults, including, without limitations, latent and patent
defects. Landlord has no obligation to alter, improve or repair the Premises
during the Lease term.
6. COVENANTS OF LANDLORD. Landlord covenants and warrants with Tenant:
6.1. That Landlord has the right to lease the Premises on the terms
herein contained;
6.2. That Landlord has good and marketable title to the Premises,
free and clear of all tenants and occupants and the rights of either;
6.3. That Tenant, upon paying the rent and performing the covenants
of this Lease, may quietly have, hold and enjoy the Premises during the
term hereof and any renewal thereof.
Ex. 10.3 - 2
7. UTILITIES. Tenant shall pay all charges for utilities on the
Premises, including, but not limited to, charges for gas, electricity, water and
sewage, and lighting for the parking lot.
Tenant shall also pay any and all charges relating to snow removal,
graveling, parking lot and roads, assessments for improvements to roads, and
maintenance of lawn or grounds regarding the Premises.
8. REAL ESTATE TAXES AND SPECIAL ASSESSMENTS. Tenant shall pay all real
property taxes and installments of special assessments, payable during the term
of this Lease and any renewal thereof. The real property taxes and installments
of special assessments payable during the first and last Lease Years shall be
prorated for the period of Tenant's occupancy for such period.
9. REPAIR AND MAINTENANCE. Tenant shall, at its own expense, maintain
the roof, exterior, interior and all structural components and equipment of and
in the building located on the Premises, including, without limitation, the
electrical system, the plumbing, any heating, ventilating and air conditioning
systems, all drains, fixtures, appliances, overhead doors, loading docks,
entryways, and the parking lot, in good repair and in good sanitary condition
during the term of this Lease or any renewals thereof.
Tenant shall replace at its own expense promptly any and all glass broken
in or about the Premises with glass of the same quality used when originally
installed, except glass broken by Landlord, its employees, or agents.
Tenant does further agree that it will not in any manner deface, injure or
destroy the Premises, or any part thereof, and to the extent that the Premises
are defaced, injured or destroyed by an act of negligence of Tenant, its agents,
invitees, customers, and/or employees, tenant will at its own expense,
notwithstanding anything contained in this Lease to the contrary, repair or
restore the Premises to the original condition at commencement of this Lease.
10. ALTERATIONS. Tenant shall not make any alterations, additions,
installations or changes in or to the Premises without Landlord's prior written
consent, which consent shall not be unreasonably withheld. All alterations,
additions, installations and change in and to the Premises shall be at Tenant's
sole cost and expense and shall remain on and be surrendered with the Premises
as a part thereof at the termination of this Lease. Provided, however, that if
such alterations, additions and/or improvements costs of signs, trade fixtures,
equipment and/or other property which is not normally considered to be a
structural part of such premises, Tenant may remove the same at or prior to the
termination of this lease on condition that it repair any damage caused to the
Premises by reason of such removal. All such alterations, additions,
improvements, and changes shall be done in a good and workmanlike manner, in
compliance with applicable laws, building codes and regulations, shall not
weaken any structural portions of the Premises, and Tenant shall not permit any
laborer's mechanic's or materialmen's liens to attach to the Premises by reason
thereof. Tenant shall have the right to contest any mechanic's lien or other
lien which attaches to the Premises, provided that Tenant provides Landlord with
reasonable security for the same.
Ex. 10.3 - 3
11. SIGNS. Tenant shall have the right to install or affix signs on the
Premises setting forth its name and/or its sublessee's name and the products
they distribute, providing the same comply with all applicable laws, orders,
ordinances, regulations and requirements of the State, country and/or municipal
authorities, and providing further, that said signs do not injure any structural
portion of the Premises.
12. LIABILITY. Landlord shall not be responsible or liable to Tenant, and
Tenant hereby indemnifies and holds Landlord harmless for any damage, loss or
expense to Tenant or its property caused by or incurred by reason of fire,
water, snow , rain, backing up of water mains or sewers, frost, steam, sewage,
gas, electricity and by the bursting, stoppage or leaking of pipes or radiators,
plumbing sinks and fixtures in or about the Premises or by reason of the
collapse of the building of which the Premises are a part. Further, Landlord
shall not be responsible or liable for, and Tenant hereby indemnifies and holds
Landlord harmless for any damage, either to person or persons or property or the
loss of property, sustained by Tenant or by any other person or persons due to
any act or neglect of Tenant. Further, Tenant shall not be responsible or
liable for, and Landlord hereby indemnifies and holds Tenant harmless for any
damage, either to person or persons or to property or the less of property,
sustained by Landlord or by any other person or persons due to any act or
neglect of Landlord.
13. INSURANCE. Tenant agrees that during the term of this Lease or any
renewal thereof it will carry and provide to Landlord copies of policies or
certificates evidencing proof of the existence of (a) fire and extended coverage
insurance on the building situated on the Premises and the contents thereof for
the full replacement value thereof, and Tenant shall cause Landlord to be
designated as an additional named insured under such policy or policies and
Tenant hereby waives all claims against Landlord for loss or damage resulting
from fire or other insurable hazards regardless of the cause of such damage,
including damage resulting from the negligence of Landlord, its agent, servants
or employees, and Tenant agrees to obtain waiver of subrogation endorsements on
Tenant's insurance policies which cover the Premises in the event of a happening
of such hazards; (b) comprehensive public liability insurance naming Landlord as
the insured, to insure against injury to property, person or loss of life
arising out of the ownership, use, occupancy or maintenance of the Premises with
limits of public liability not less than Two Million Dollars/Four Million
Dollars ($2,000,000.00/$4,000,000.00) for death and/or bodily injury, including
personal injury and property damage liability, also covering intentional acts of
the insured and contractual liability voluntarily assumed by the insured; (c)
plate glass insurance; and (d) workers' compensation insurance with limits of
liability not less than that required by applicable law.
14. DESTRUCTION OF OR DAMAGE TO PREMISES. If the Premises are destroyed
by or damaged by fire, or any action of the elements, or other casualty,
Landlord agrees, with reasonable dispatch after notice thereof, at its own rest
and expense, to the extent of insurance proceeds, to restore the Premises to a
kind and quality substantially similar to those existing as of the commencement
of this Lease. In the event the destruction or damage is so extensive as to
make it unfeasible for Tenant to conduct its business on the Premises, rent
shall be payable until Tenant resumes the conduct of its business on the
Premises.
Ex. 10.3 - 4
15. DEFAULT. If Tenant shall be in default in performing any of the terms
and provisions of this Lease, Landlord shall give Tenant notice in writing by
certified mail of such default, and if Tenant shall fail to cure such default
within ten (10) days after the receipt of such notice (or shall fail in that
time to commence to cure a default whose cure would require more than 10 days) ,
then and in any such event, Landlord may, without further notice or demand,
elect to either terminate this lease, or without terminating this Lease,
terminate the Tenant's right to possession of the Premises. Besides any other
rights and remedies Landlord may have by law or otherwise, it shall have the
immediate right of re-entry and may remove all persons and property from the
Premises. Landlord's entry upon and taking possession of the Premises shall not
in any way terminate this Lease or release Tenant in whole or in part from
Tenant's obligation to pay the rental hereunder for the full Lease term or
discharge Tenant from liability for any loss or damage sustained by Landlord on
account of Tenant's breach of the Lease unless Landlord elects in writing to
terminate the Lease. Upon Landlord's re-entering the Premises, it may attempt
to relet all or any part of the Premises for such term or terms and at such rent
or rentals as Landlord, in the exercise of its sole discretion, may deem
advisable. Upon such reletting, all rent and other sums received by Landlord
shall be applied; first, to the payment of any costs and expenses of such
reletting, including reasonable attorney's fees incurred by Landlord due to
Tenant's default, brokerage fees and reasonable costs of alterations and repairs
undertaken for such reletting; second, to payment of any indebtedness other than
rent due hereunder from Tenant to Landlord; third, to the payment of rent and
other charges due and unpaid hereunder; and the residue, if any, shall be held
by Landlord and applied to the payment of any future amounts that become due and
payable hereunder. If such rental and other sums received from such reletting
during any month be less than the rental (and the costs set forth in the
previous sentence) to paid during such month by Tenant hereunder, Tenant shall
pay over such deficiency immediately to Landlord.
Landlord may, but shall not be obligated to, cure, at any time upon
reasonable notice to Tenant, any default by Tenant under this Lease, and
whenever Landlord so elects, all costs and expenses, including reasonable
attorney's fees, incurred by Landlord incurring the default, together with
interest thereon at an annual rate of 18% from the date of such payment, shall
be payable as additional rent to Landlord on demand.
16. BREACH BY LANDLORD. If Landlord shall fail to perform any covenant
agreed by it to be performed herein, and said covenant obligates Landlord to
expend a certain sum of money, Tenant may cure said default of Landlord by the
expenditure of the money required and may deduct the amount spent from any rent
due or to become due hereunder, provided that Tenant gives Landlord written
notice of such default after which notice Landlord shall have thirty (30) days
to cure the same or to commence to cure the same in the event that the default
by its nature requires a greater length of time. In the event Landlord's breach
is such that the expenditure of money cannot cure such breach, Tenant may
suspend payment of rent.
17. HOLDING OVER. If Tenant shall remain in possession after the
expiration of the term of this Lease or any renewal thereof with Landlord's
acquiescence, Tenant shall be a tenant at will
Ex. 10.3 - 5
on a month-to-month basis at an annual minimum rent one and one-half times the
most recent annual minimum rent paid by Tenant and there shall be no renewal of
this Lease by operation of law.
18. SURRENDER OF PREMISES. Tenant shall, at the expiration of this Lease,
surrender the Premises, including all improvements subsequently made thereon,
except as hereinabove provided, to Landlord in as good condition and repair as
at the time possession thereof was taken, damage from natural wear and tear
excepted, and except for damage from an insured casualty.
19. SUBLEASE AND ASSIGNMENT. Tenant shall not assign or sublet the
Premises without the prior written consent of Landlord. In the event Tenant
desires to assign or sublet the Premises or cease operations upon the Premises;
Tenant shall give Landlord one hundred twenty (120) days written notice.
Landlord shall have the right at its sole option to terminate this Lease by
giving Tenant written notice of such termination prior to the expiration of the
one hundred twenty (120) days.
Consent by Landlord to any one assignment or subletting shall not operate
as a waiver of Landlord's rights as to any subsequent assignments or subletting.
No subletting or assignment shall release Tenant or any guarantor of this Lease
of any of its or their obligations under this Lease or be construed or taken as
a waiver of any of Landlord's right or remedies hereunder.
20. EMINENT DOMAIN AND CONDEMNATION. All damages awarded for a taking
under the power of eminent domain of all or any part of the Premises shall
belong to and be the property of Landlord; provided, however, that Tenant shall
be entitled to any separate award made for relocation of Tenant's business and
depreciation or damage to and cost of removal of Tenant's personal property and
trade fixtures. The provisions contained in this paragraph shall apply in like
way to any sale made under imminent threat at such taking. In the event at any
lessor taking or sale, this Lease shall continue in full force and effect as if
said taking had not occurred, but Landlord shall restore the improvements to a
condition as nearly as practicable to their former condition at Landlord's sole
cost and expense.
21. ENVIRONMENTAL MATTERS. Tenant will not, nor shall it permit any
approved subtenant or other party, to install, store, treat, use, transport or
dispose, or permit or acquiesce in the installation, storage, use, treatment,
transportation or disposal, on the Premises of any chemical, material, or
substance which is regulated as toxic or hazardous or exposure to which is
prohibited, limited or regulated by any federal, state, county, regional, local
or governmental authority or which, even if not so regulated, may or could pose
a hazard to the health and safety of the occupants of the Premises or the
occupants of adjoining buildings or properties, unless written approval of the
Landlord is obtained by Lessee approving of the installation, storage,
treatment, use, transportation or disposal of a certain chemical, material or
substance. In the event of any such installation, storage, treatment, use,
transportation or disposal, whether approved by Landlord or not, the Tenant
shall, as required by applicable law or at the direction of the Landlord or any
federal, state or local authority, remove any such hazardous materials, or
otherwise comply with the regulations or orders of such authority, all at the
expense of Tenant. If the Tenant shall fail to proceed with such removal
Ex. 10.3 - 6
or otherwise comply with such regulations or orders within any reasonable cure
period set by the Landlord, or within the cure period permitted under the
applicable regulation or order, Landlord, at its option, may declare that an
event of default has occurred hereunder, or Landlord may, but shall not be
obligated to, do whatever is necessary to eliminate such hazardous materials
from the Premises or otherwise comply with the applicable regulation or order,
and the cost thereof shall become immediately due and payable from Tenant,
without notice. Further, Tenant shall indemnify Landlord and hold Landlord
harmless from and against all loss, damage and expense (including, without
limitation, reasonable attorney's fees and costs incurred in the investigation,
defense, and settlement of claims) that Landlord may incur as a result of or in
connection with the assertion against Landlord of any claim relating directly or
indirectly, in whole or in part, to the presence or removal of any hazardous
materials, or compliance with any federal, state or local laws, rules,
regulations or orders relating thereto. The liability of Tenant under the
provisions of this paragraph shall survive the expiration or other termination
of this Lease or the transfer of Landlord's interest in the Premises.
22. WAIVER. No terms or conditions of this Lease shall be in any manner
altered, waived or abandoned except by written instrument acknowledged and
delivered by Tenant to Landlord of any of the terms and conditions of this Lease
shall be deemed or taken to be a waiver of any succeeding breach at said terms
and conditions.
23. BINDING CLAUSE. The covenants, conditions and agreements contained
herein shall bind and inure to the benefit of Landlord and Tenant and their
respective legal representatives, successors and assigns.
24. BROKER'S COMMISSION. Each of the parties represents and warrants that
there are no claims for brokerage commissions or finder's fees in connection
with the execution of this Lease and each of the parties agrees to indemnify the
other against and hold them harmless from all liabilities arising from any such
claim.
25. NOTICES. Notices given hereunder shall be in writing and delivered in
person or sent by United States certified or registered mail, postage prepaid to
the parties at the following addresses:
Landlord: AG PARK, L.L.C.
0000 Xxxx Xxxx
Xxxxx Xxxxx, XX 00000-0000
Tenant: Agsco, Inc.
0000 Xxxx Xxxx
Xxxxx Xxxxx, XX 00000-0000
Any notice required hereunder shall be deemed given on the date postmarked.
Ex. 10.3 - 7
IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease on the day
and year first above written.
AG PARK, L.L.C.
By:
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Its:
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By:
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Agsco, Inc.
By:
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Its:
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By:
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Ex. 10.3 - 8
STATE OF NORTH DAKOTA )
) ss.
COUNTY OF GRAND FORKS )
The foregoing instrument was acknowledged before me this 13th day of
March , 1997, by Xxxxx X. Xxxxx, the President and Xxxxx
X. Xxxxxxxx, the Secretary of AG PARK, L.L.C., a North Dakota limited
liability company, on behalf of the company.
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Notary Public
My Commission Expires:
STATE OF NORTH DAKOTA )
) ss.
COUNTY OF GRAND FORKS )
The foregoing instrument was acknowledged before me this 13th day of
March , 1997, by Xxxxx X. Xxxxx, the President and Xxxxx
X. Xxxxxxxx, the Secretary of Agsco, Inc., a North Dakota limited
liability company, on behalf of the corporation.
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Notary Public
My Commission Expires:
Ex. 10.3 - 9
ADDENDUM
Section 4.1 of that certain Lease Agreement dated March 13, 1997, by
and between AG PARK, L.L.C. and Agsco, Inc., shall be amended as of the date of
this Addendum to read as follows:
4.1 MONTHLY RENT. Monthly Minimum Rent (1/11th of Annual Minimum Rent)
shall be in the amount of One Thousand Three Hundred and No/100 Dollars
($ 1,300.00 ) during the Lease Year commencing February 1, 1997, and
ending December 31, 1997.
DATED this 13th day of March ,1997 .
AG PARK, L.L.C.
By:
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Its:
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Agsco, Inc.
By:
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Its:
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Ex. 10.3 - 10
