Ground Lease 2-11-06
Ji.,
DRAFT 02/11/06
GROUND LEASE
Between
SOUTHWEST METRO TRANSIT COMMISSION,
as Landlord
and
APOGEE INVESTMENTS CHANHASSEN, L.L.C.,
as Tenant
Chanhassen, Minnesota
CITY OF CHANHASSEN
RECEIVED
APR 1 8 2006
CHANHASSEN PU.NNING DEPT
...
TABLE OF CONTENTS
SECTION
PAGE
DEFINITIONS................................................................................................................................ 1
PREMISES. .................................................................................................................................... 3
TERM. .......................................................................................................................................... .. 7
ANNUAL RENT - ADDITIONAL RENT............................... ...... ................... ................. ............ 7
REAL ESTATE TAXES................................... ............................................................................. 8
WORK...................................................................................................................................... ...... 9
INSURANCE................................................................................................................................ 12
INDEMNIFICATION AND WAIVER .............................. ........ ...... ............... ............................. 13
LANDLORD'S REPRESENTATIONS AND WARRANTIES .................................................. 13
TENANT REPRESENTATIONS AND WARRANTIES............................................................ 14
REPAIRS AND MAINTENANCE OF IMPROVEMENTS ....................................................... 14
LIGHTING .......... ................. .... ..................... ........... .... .... ........... ............... ............. ............ ......... 19
USES. . . . . . . .................................................................................................................................... 19
UTILITIES.................................................................................................................................... 22
GOVERNMENTAL REGULATIONS ..................... ................... ...... ........ ............ ............ ....... ... 22
DAMAGE AND D ESTRUCTI ON............................................................................................... 22
EMINENT DOMAIN ...................................................................................................................23
TRANSFER OF LANDLORD'S INTEREST.... ...... ..... .................. ........... .................... ......... ..... 24
ASSIGNMENT AND SUBLETTING ........................................... ............... ................. ........ ...... 25
TENANT'S DEFAULT AND LANDLORD'S REMEDIES....................................................... 26
TEN ANT'S REMEDIES.............................................................................................................. 29
COVENANT OF TITLE .............................................................................................................. 29
LEASEHOLD MOR TGAG E ....................................................................................................... 30
HAZARDOUS MATERIAL..... ............... ............ ......... ........... .............. ................. ..................... 31
CONDITION OF PREMISES AT TERMINATION ...................................................................31
HOLDING OVER ........................................................................................................................ 31
NOTICES...................................................................................................................................... 32
PARTIAL INVALIDITy..................................... .... ..... ......................... ...................................... 33
ENTIRE AGREEMENT - APPLICABLE LAW......................................................................... 33
SUCCES SORS AND ASSIGNS.................................................................................................. 32
MEMORANDUM OF LEASE..................................................................................................... 33
BROKER'S REPRESENTATION ................... ............... ........ ............. ......... ............... ....... ......... 33
CAPTIONS AND DEFINITIONS .. ............................... ...... ........ .......... .... ......... .... ............ .... ..... 33
SURVIVAL. ................................................................................................................................. 34
FORCE MAJEURE. ..................................................................................................................... 34
ATTORNEYS' FEES................................................................................................................... 34
SATELLITE DISH................................................................................... .................................... 34
CONTINGENCIES....................................................................................................................... 34
..
Exhibit A
Exhibit B
Exhibit C
Exhibit D
Exhibit E
Exhibit F
Exhibit G
EXHIBITS
Legal Description of Transit Parcel
Site Plan and Premises
Common Area
Exclusive Parking Area
Construction Staging, Utilities Access, Retail Signage Areas
Permitted Exceptions
Standard Sign Criteria
..
GROUND LEASE
THIS GROUND LEASE ("Lease") is made and entered into as of this _day of
, 2006, by and between SOUTHWEST METRO TRANSIT COMMISSION,
a joint powers entity created by the Cities of Chanhassen, Chaska and Eden Prairie (hereinafter
referred to as "Landlord"), and APOGEE INVESTMENTS CHANHASSEN, a
(hereinafter referred to as "Tenant").
\V I T N E SSE T H:
That in consideration of the rents, covenants and conditions herein set forth, Landlord
and Tenant do hereby covenant, promise and agree as follows:
1. DEFINITIONS.
(a) Commencement Date. The date that is the earlier of: (i) May 1,2007; or (ii) the
date the contingencies described in Section 38 of this Lease are satisfied.
(b) Common Area. The striped portion of the Transit Parcel depicted on Exhibit C
attached hereto and made a part hereof.
(c) Default Rate. The rate of two percent (2%) in excess of the prime rate of U.S.
Bank National Association or the highest rate permitted by law, whichever is
lower.
(d) Building Waste Storage Areas. An area consisting of approximately 300 square
feet located in an interior room in each of Tenant's Buildings designated for the
storage of trash and rubbish.
( e) Exclusive Parking Area. The striped portion of the Transit Parcel depicted on
Exhibit D attached hereto and made a part hereof consisting of approximately 90
parking spaces.
(f) Lease Date. The date this Lease is executed by all signatories.
(g) Leasehold Mortgage. A mortgage of the Premises and/or Tenant's leasehold
interest under this Lease, and the improvements constructed or to be constructed
thereon.
(h) Leasehold Mortgagee. A party holding a Leasehold Mortgage.
(i) Occupant. Any Person from time to time entitled to the use and occupancy of any
portion of the Total Site, including Landlord or Tenant, the employees and lessees
of Landlord or Tenant, or the employees of such lessees.
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U) Parcel. The Transit Parcel and the Premises shall each be a "Parcel".
(k) IJilly. Landlord and Tenant and, after compliance with the notice requirements
set forth in this Lease, each of their respective successors and assigns.
(I) Permittee. Each Occupant of the Transit Parcel or the Premises, as applicable,
and each officer, director, agent, contractor, customer, vendor, supplier, visitor,
invitee, licensee, subtenant, and concessionaire of each Occupant insofar as their
activities relate to the intended use of the Total Site.
(m) Person. A natural person, an association, a corporation, a limited liability
company, a partnership, a trustee or other legal entity.
(n) Premises. The certain parcel of real property in the City of Chanhassen, State of
Minnesota, consisting of two retail buildings, of approximately 9,000 rentable
square feet each, or 18,000 rentable square feet altogether. The legal description
of the Premises is Lot _, Block _, Addition, and is
shown on Exhibit B attached hereto and made a part hereof.
(0) Signage Area. The striped portion of the Transit Parcel depicted on Exhibit E
attached hereto and made a part hereof.
(p) Site Plan. The site plan attached hereto as Exhibit B and made a part hereof.
(q) Tenant's Buildings. The two retail facilities to be constructed on the Premises as
generally depicted on the Site Plan.
(r) Total Site. Collectively, the Transit Parcel and the Premises.
(s) Transit Parcel. That certain parcel of real property owned by Landlord which is
identified on Exhibit A and legally described as
(t) Utilities. Those facilities and systems for the transmission of utility services
including, without limitation, storm sewer catch basins (and related storm sewer
lines), water lines, sanitary sewer lines, electrical lines, gas lines, telephone lines,
and any and all other utility lines and any valves, switches, transformers,
manholes or other accessory devices appurtenant and/or accessory to such utility
lines.
(u) Work. Any construction activities on the Total Site performed by the Parties in
accordanc~ with this Lease.
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2. PREMISES.
Landlord hereby demises unto Tenant and Tenant rents the Premises from Landlord.
Tenant covenants and agrees to pay rent during the term of this Lease pursuant to the provisions
of the Lease. Landlord also grants to Tenant, for Tenant's benefit and for the benefit of its
Permittees the following rights on, over and across the Transit Parcel for the benefit of the
Premises:
(a) Tenant's Buildings. Tenant shall have the right to construct, maintain and use
Tenant's Buildings to be constructed on the Premises in accordance with this
Lease.
(b) Exclusive Parking. Tenant and its Permittees, while such Permittees are using the
Premises, shall have the right to use the Exclusive Parking Area for the parking of
vehicles, subject to the following terms and conditions.
(i) Landlord shall, at Tenant's cost and expense, post retail parking only signs
on the Exclusive Parking Area, which area shall be for the exclusive use of
Permittees of the Premises. Landlord shall not be required to post a sign
for each stall.
(ii) The size, design, and location of the signage identifying the Tenant's
exclusive parking stalls shall be agreed upon by Tenant and Landlord.
(iii) Tenant shall, at Tenant's expense, enforce the parking restrictions in the
Exclusive Parking Area during business hours in accordance with the
following procedures:
(iv) Except as required by a government authority having jurisdiction over the
Transit Parcel, Landlord shall not make or consent to any permanent
change in the Transit Parcel that reduces the number of parking stalls or
changes the location of the stalls in the Exclusive Parking Area without
the consent of Tenant, which consent may not be unreasonably withheld.
If the location of the Exclusive Parking Area is changed as provided in
this Section, Exhibit D shall be revised accordingly.
(v) Other than as expressly set forth in this Lease, Landlord shall not charge
Tenant or its Permittees any fee for parking in the Exclusive Parking Area.
(vi) Tenant shall have the right to designate portions of the Exclusive Parking
Area as available only for short term parking. The area allocated to short
term parking, as well as the duration of such parking, shall be as
determined by Tenant from time to time. Tenant shall be responsible, at
its sole cost and expense, forsignage in the designated short tern1 parking
areas.
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(vii) Upon completion of construction of the Exclusive Parking Tenant shall
reimburse Landlord within ten (10) days of receipt of an invoice from
Landlord for the cost incurred by Landlord to construct the Exclusive
Parking Area
(c) Common Area. Landlord and its Permittees and Tenant and its Permittees shall
have the non-exclusive right to use the driveway and sidewalk areas of the
Common Area for ingress and egress, and for the ingress, egress and
accommodation of pedestrians, as the Common Area may from time to time be
constructed and maintained for such uses, subject to the following terms and
conditions:
(i) The non-exclusive rights granted in this Section 2(c) shall be subject to the
exclusive parking rights granted in Section 2(b) of this Lease, provided
that Tenant shall not use any portion of the Common Area other than the
Exclusive Parking Area to meet parking requirements for the use of
Tenant's Buildings.
(ii) Landlord shall not construct any fence or other barrier or improvement
which would unreasonably prevent or obstruct the passage of pedestrians
or vehicles in the Common Area for the purposes herein permitted, or
which would unreasonably interfere with accessibility for pedestrians and
vehicular traffic between the Premises and Lyman Boulevard and/or
Highway 101 and/or Highway 212 (as rebuilt).
(1) Except for repairs required to the Common Area or the utility lines or
other improvements located in the Common Area, Landlord shall pay
all costs of improving and maintaining the Common Area ("Common
Area Cost"). Landlord shall pay 100% of the costs for the area
identified in pink on Exhibit C. Tenant shall reimburse Landlord for
100% of the costs for the area identified in orange on Exhibit C.
(d) Signage.
(i) Tenant shall construct and maintain signage on a pylon sign in the Signage
Area, to display the names or trade names of Occupants of the Premises on sign
panels located below permanently affixed signage for Landlord, together with the
right to use and install Utilities reasonably necessary for the illumination of such
signage, subject to the following terms and conditions:
(A) Tenant will cause to be delivered to Landlord for Landlord's approval a
proposed design (the "Design") for the- pylon sign to be installed in the
Signage Area, which Design shall specify the size,architectura I features
and materials for the pylon sign and signage criteria. for the p6manently
affixed signage of Landlord and the Tenant's sign panels to be installed
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thereon. Landlord shall have sole discretion in approving the Design for
Landlord's signage, and so long as the Design for Tenant's signage is
consistent with the signage criteria attached as Exhibit G, Landlord's
approval of Tenant's signage shall not be unreasonably withheld.
Landlord shall, within ten (10) days after receipt of the Design, deliver to
Tenant Landlord's approval or Landlord's proposed changes to the
Design. If Landlord fails to approve or propose changes to the Design
within ten (10) days after submission to Landlord, the Design shall be
deemed approved by Landlord. Tenant shall have the right to approve
Landlord's proposed changes to Tenant's signage on the Design. Tenant
shall not be required to approve any Landlord proposed changes to
Tenant's signage on the Design which would (a) materially increase the
cost of construction or maintenance of the pylon sign, (b) not be consistent
with the design of Tenant's Buildings or anticipated tenant signage
requirements, ( c) not be consistent with retail signage requirements
generally or (d) be in violation of applicable laws, ordinances and codes.
In the event Tenant objects to Landlord's proposed changes to Tenant's
signage on the Design, Tenant shall propose a revised Design to Landlord
as provided above until Landlord and Tenant are in agreement as to the
Design. If Tenant fails to approve or object to Landlord's proposed
changes to the Designs within ten (10) days after Landlord submits the
same to Tenant, such changes shall be deemed approved.
(B) Upon approval of the Design, Landlord shall apply to the City of
Chanhassen for all permits or approvals (the "Signage Approval")
required for the construction of a pylon sign in the Signage Area and shall
use good faith efforts to pursue receipt of the same from the City of
Chanhassen. Landlord and Tenant shall cooperate to make such changes
as may be reasonably required by the City of Chanhassen to gain approval
of the Design.
(C) Tenant shall construct the pylon sign in the Signage Area in accordance
with the Design.
(D) Tenant is entitled to maintain signage for its Occupants on no less than
_ % of the signable portion of the pylon sign and Landlord is entitled to
maintain signage on the remaining _% of the signable portion of the
pylon sign. Landlord's portion will be on the top. Landlord and Tenant
shall each be responsible for the cost of installing and maintaining their
respective signage on the pylon signs.
(ii) Tenant shall have the right to install exterior signage on both the north and
south sides of Tenant's Buildings as may be permitted by applicable
government ],l\VS or ordinances subject to Landlord's approval of the
signage, which approval shall not be unreasonably withheld if the signage
is consistent with the sign criteria attached as -ExhibitG, which Exhibit'G
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shall be incorporated and made a requirement to each sublease. Tenant
shall submit the designs for the signage to Landlord, and Landlord shall
respond within ten (10) days. In the event Landlord fails to respond to
Tenant's proposed designs within ten (10) days, the designs shall be
deemed approved.
(e) Building Waste Storage Areas. Tenant shall have the exclusive right to use the
Building Waste Storage Areas for the installation, operation and maintenance of a
compactor or dumpster and loading dock. Tenant shall install and be responsible
for maintaining, at its sole cost and expense, the compactor or dumpster and
loading dock located in each Building Waste Storage Area in good condition and
repair and free of trash and refuse. Tenant shall be responsible for trash removal
for the Premises and shall ensure trash is removed at least weekly. A Building
Waste Storage Area shall be located in an interior room of each of Tenant's
Buildings.
(f) Utilities. Tenant shall have a non-exclusive right to use, maintain and repair the
Utilities serving the Premises which may now or hereafter be situated on the
Transit Parcel, provided that Tenant shall access the Utilities for maintenance and
repair in the area described on Exhibit E. Landlord shall have the right at any
time to relocate Utilities on the Transit Parcel upon thirty (30) days' prior written
notice to Tenant, provided that such relocation: (a) shall not interfere with or
diminish the utility services to the Premises; (b) shall not reduce or unreasonably
impair the usefulness or function of such Utilities; (c) shall be performed without
cost, expense or interruption of service to Tenant; (d) shall be completed using
materials and design standards which equal or exceed those originally used; and
( e) shall have been approved by the utility company and the City of Chanhassen,
if necessary.
3. . TERM AND OPTIONS TO EXTEND.
(a) Initial Term. The initial term of this Lease shall be for a period of approximately
thirty (30) years. It shall commence on the Commencement Date and shall
continue to the last day of the month immediately preceding the first day of the
month which is the thirtieth anniversary of the first day of the first full month
following the Commencement Date (the "Initial Term").
(b) For purposes of the Rent Periods described in the tables in Exhibit H, Year I will
commence on the Rent Commencement Date and terminate on the last day of the
full month immediately preceding the first anniversary of the first day of the first
full month following the Commencement Date. Each year thereafter will be a
period of 12 months.
(e) Ex\ension Options. Tenant shal!.have two (2) option(,).(hcreimifter each called
an "Extension Option") to extend the terril ofthisLeascfor an adclition;:lI pCI:iod
of ten (J 0) years (hereinaftcr'eachcalled an ",!;2aensiQ,I1 Period") on cach' .
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Extension Option, such Extension Period to begin respectively upon the
expiration of the Initial Term or the immediately preceding Extension Period, as
applicable, and all of the terms and conditions of this Lease shall apply to each
such Extension Period, subject to the following terms and conditions:
(i) Tenant shall not have the right to exercise any Extension Option at any
time while Tenant is in default of this Lease following delivery of notice of such
default.
(ii) If Tenant shall elect to exercise an Extension Option, it shall do so by
giving written notice to Landlord not less than six (6) months prior to the
expiration of the Initial Term or the immediately preceding Extension Period, as
applicable. Prior to six (6) months before the expiration of the Initial Term or the
immediately preceding Extension Period Landlord may, but is not required to,
provide notice to Tenant and its Lender of the expiration date ofthe Initial Term
or the immediately preceding Extension Period. If Tenant does not exercise any
Extension Option in the time period or in the manner provided in this Section,
such Extension Option shall expire.
(iii) Tenant shall pay to Landlord Annual Rent in the amounts as determined in
Section 4(b) for the Extension Periods, unless abated or diminished as provided in
this Lease.
(d) Lease term. The phrase "Lease term," as used in this Lease, shall mean the Initial
Term of this Lease and any Extension Period pursuant to this Section.
(e)
4. ANNUAL RENT - ADDITIONAL RENT.
(a) Annual Rent. Tenant shall, during the Lease term, pay to Landlord, at such place as
Landlord shall designate in writing, from time to time, and without demand, deductions, set-off,
or abatement, annual rent ("Annual Rent"), which shall be payable, in advance, in monthly
installments due on the first day of each month. Tenant shall commence paying Annual Rent
and other amounts due under this Lease on the date (the "Rent Commencement Date") which is
the earlier of 1) the first day of the calendar month after the calendar month in which Tenant is
issued a certificate of occupancy for the Premises, or 2) the Commencement Date. Tenant shall
provide Landlord immediate written notice of the issuance of a certificate of occupancy. Annual
Rent shall be as set forth in Article 13 (b).
(b )Extension Periods:..,Jf Tenant exercises its option to renew the Lease pursuant to 3( c)
above, the AlUmal Rent for each year during the Option Period shall be as follows: such
Annual Base Rent payable each year shall be the product calculated by mllliplying the
AnnllalRenlJor the preceding year by a fraction (the numerator of which is the
Consumer Price Index 1\11 Urban Consumers. U.S. City Average.- All Items, Base 1982-
-198-1 eq\lnls 100. as published by the U.S. DcpartmeJit of Labor Statistics ("CPI-U") for
7
.
the month that is three (3) months preceding the first day of the Year of this Lease for
which the Annual Base Rent is being calculated, and the denominator of which is the
CPI-U that is fifteen (15) months preceding the first day of the Year of this Lease for
which the Annual Base Rent is being calculated), but in no event shall the Annual Base
Rent for any year during the Option Period be less than the Annual Base Rent that was in
effect during the prior Year. If the CPI-U is discontinued, comparable statistics on the
purchasing power of the consumer dollar published by the U.S. Department of Labor or
its successors as mutually agreed by Landlord and Tenant shall be used for making the
computations in this paragraph. In the event that the base period (1982-1984 equals 100)
used in computing the CPI-U is changed, the figures used in making the adjustment shall
accordingly be changed so that changes in the CPI-U are taken into account with the
same mathematical results notwithstanding any such change in the base period. In the
event of any other changes to the CPI-U, the Landlord and Tenant shall mutually
designate, a comparable calculation to be used for the calculations of this paragraph.
(c) Additional Rent. All amounts which Tenant is required to pay pursuant to this Lease
(other than Annual Rent), together with any fine, penalty, interest and costs which may
be added for nonpayment or late payment thereof, shall constitute additional rent
(referred to herein as "Additional Rent"). If Tenant fails to pay any Additional Rent due
under this Lease, then Landlord shall have the right to pay the same and shall have all of
the rights, powers and remedies with respect thereto as are provided herein or by law in
the case of nonpayment of Annual Rent.
(d) Late Payment. For each payment of Annual Rent or Additional Rent received after the
fifth day following the due date therefor, Tenant shall pay to Landlord a late charge of
$250 plus five percent (5%) of the payment due if paid promptly, plus interest of one and
one-half percent (1 Y2%) for each additional month such payment is late which charge
must accompany the late payment.
5. REAL ESTATE TAXES.
(a) Payment. Tenant shall pay all ad valorem real estate taxes and assessments
attributable solely to the Premises ("Taxes") directly to the applicable county or
city as Taxes are due, with a copy of the payment or receipt mailed to Landlord.
Tenant shall also pay to Landlord a twenty-eight percent (28%) of assessments
against the Total Site In the event that the Premises is established as a separate tax
parcel from the Transit Parcel, Tenant shall pay all special assessments that are
assessed against the Premises and twenty-eight percent (28%) of the assessments
that are assessed against the Transit Parcel, provided that Tenant shall not be
obligated to pay a share of special assessments against the Transit Parcel if the
Tenant's parking is allocated to the Premises when the Premises is assessed.
Notwithstanding anything to the contrary contained herein, Tenant shall not be
obligatcdto pay .any portion of fees or costs assessed as a-condition far the right
{)r privilege of development of the Total Site other thaI1. the Premises.
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(b) Challenge. Tenant shall have the right to initiate proceedings to contest the
validity or amount of any Taxes levied against the Premises or the assessed value
of the Premises with Landlord's written approval, which approval shall not be
unreasonably withheld. In the event that Tenant shall initiate a challenge to any
such Taxes, Tenant shall deposit with Landlord or with Tenant's Mortgagee an
amount sufficient to cover the unpaid portion of the taxes being challenged.
Landlord will cooperate in such proceedings and should such proceedings be
successful, Tenant shall be entitled to any tax refund or future abatement
attributable to the Premises.
(c) Separate Tax Assessment. Subsequent to completion of construction of Tenant's
Buildings, Tenant may, at Tenant's sole cost, file a plat covering the Total Site in
order to create a separately assessed legal parcel containing the entirety of the
Premises and obtain approvals from the City of Chanhassen for the creation of the
Premises as a separately assessed tax parcel. Landlord shall cooperate with
obtaining City approvals, provided that any conditions, covenants, and/or
restrictions attached to the Premises or Transit Parcel other than Permitted
Exceptions shall be subject to Landlord's approval, which approval shall not be
unreasonably withheld or delayed.
6. WORK.
(a) Tenant's Work.
(i) Landlord Architectural Approval. Prior to commencement of construction
of Tenant's Buildings, Tenant shall cause to be delivered to Landlord for
its review and approval, which approval shall not be unreasonably
withheld, proposed designs and plans for the Tenant's Buildings, which
designs and plans shall specify the architectural features and materials for
Tenant's Buildings. Landlord shall, within 21 days of receipt of the
designs and plans, submit to Tenant proposed changes in the designs and
plans for Tenant's approval, which approval shall not be unreasonably
withheld. In the event Landlord fails to submit proposed changes within
said 21 days, the designs and plans shall be deemed approved by
Landlord. In the event Tenant fails to respond to proposed changes by
Landlord within 15 days after submission thereof, the proposed changes
shall be deemed approved. .
(ii) Landscaping and exterior furniture and containers. Any landscaping or
exterior furniture and containers installed by Tenant shall match the
landscaping and exterior furniture and containers on the Transit Parcel.
(iii) Tenant's Construction. Tenant shall be responsible at its sole cost for the
performance of the construction activities in connection with the
construction of Tenant's Buildings including:
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(A)
(B)
(C)
(D)
(E)
. (F)
construct Tenant's Buildings and obtain all building permits necessary
therefor;
connect the Utilities serving the Premises from the locations provided by
Landlord in accordance with Section 6(b) below as shown on Exhibit E;
to the extent not already constructed, construct all entrances, exits,
driveways, and service drives for the exclusive use of the Premises;
construct sidewalks and curbing in the area immediately surrounding
Tenant's Buildings as shown on the Site Plan;
perform final paving and striping, if required, of the Tenant's construction
staging area located on Exhibit E; and
pay all SAC and WAC charges and park dedication fees applicable to the
development of the Tenant's Building on the Premises.
Prior to commencement of any construction Tenant shall cause to be delivered to Landlord for
approval a plan for construction staging, ingress, egress and parking of construction equipment,
deliveries of construction materials and equipment, and storage of construction materials and
equipment. Landlord shall within 21 days of receipt of said plan, submit to Tenant proposed
changes for Tenant's approval, which approval shall not be unreasonably withheld. In the event
Landlord fails to submit proposed changes to Tenant within said 21 days, the plan shall be
deemed approved. In the event Tenant fails to respond to proposed changes of Landlord within
15 days after submission thereof the proposed changes shall be deemed approved.
(b) Landlord's Work. Landlord, at its sole cost, and in accordance with the Site Plan,
will complete construction of the Utilities for connection to the Premises and with
such Utilities stubbed to the Premises. Landlord shall also construct the Exclusive
Parking Area. In addition, Landlord will grade the building area for Tenant's
Buildings within two feet of finished floor elevation. Landlord shall have no
further responsibility to construct any Premises site work.
(c) Bond and Liens. Tenant agrees to provide a performance and payment bond in
the amount of the contract for construction of Tenant's work in favor of Landlord.
Tenant agrees to keep the Premises ftee and clear of all liens arising out of, or ,
claimed by reason of, any Work performed, material furnished or obligations
incurred by or at the insistence of Tenant, and to indemnify, defend and save
Landlord harmless from all such liens or claims of lien and all attorneys' fees or
other costs and expenses incurred by reason thereof. Should Tenant fail to fully
discharge or bond over any lien or claim of lien, within 30 days after written
notice from Landlord, Landlord may, at its option, pay the same or any part
thereof, and the amount of such payment shall be due and owing to Landlord from
Tenant as of the date of such payment, plus 10% as Landlord's administrative fee.
No such payment by Landlord .'shall cure or-act 'asa waiver of Tenant's default.
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No liens of any character whatsoever created or suffered by Tenant shall in any
way extend, attach to or affect the rights of Landlord in the Premises.
(d) Alterations. Tenant, or any subtenant if permitted in the sublease, may at any
time and from time to time, at its expense, make exterior alterations to Tenant's
Buildings, or any portion thereof, provided Landlord has given prior written
approval which shall not be unreasonably withheld; such Work shall be
completed in compliance with all applicable legal requirements. Tenant, or any
subtenant if permitted in the sublease, may make interior alterations without the
consent of Landlord.
(e) Work Conditions. Tenant shall perform any and all Work on the Total Site in
accordance with the following terms and conditions:
(i) All Work shall be done in the following manner: (A) as to not
unreasonably interfere with Landlord's normal use, occupancy or
enjoyment of the Transit Parcel ownership rights; (B) in full compliance
with the provisions of this Agreement; (C) in full compliance with all
applicable statutes, codes, ordinances, laws, rules and regulations, (D) in a
good and workmanlike manner; (E) as not to permanently adversely
affect, impair or destroy the structural soundness or integrity, aesthetic
appearance or functional utility of the property or improvements on the
Transit Parcel; (F) so as not to cause Landlord to be in violation of any
applicable statute, code, ordinance, law, rule and/or regulation; (G) as
diligently and as quickly as reasonably possible; (H) so as to clean the area
and restore the affected portion of the area on which the Work was done to
a condition equal to or better than the condition which existed prior to the
commencement of such Work; and (I) in a manner that will not materially
impair access to the businesses located on the Total Site.
(ii) No governmental rule, ordinance or regulation shall be violated as a result
of any Work, especially if such action results in any Occupant of the
Premises being in violation of any such governmental rule, ordinance or
regulation; and
(iii) Tenant shall and hereby does undertake to indemnify, defend and hold
Landlord, harmless from all costs, injuries, damages, expenses (including
reasonable' attorneys fees), liens, legal actions, claims or liabilities,
including but not limited to mechanics liens, which arise from any Work
being done by or on behalf of the Tenant. Prior to commencing any Work,
Tenant shall provide proof of adequate liability insurance coverage of the
type and in the amounts set forth in Section 7. Landlord shall be an
additional insured and such insurance shall provide that the same shall not
'be canceled without at least thirty (30) days' prior written notice to the
'named and additional insured. If such insurance i~ canceled or expires
11
then Tenant shall immediately stop all work on or use of the Transit Parcel
until either the required insurance is reinstated or replacement insurance
obtained.
(f) Temporary License for Work. Landlord hereby grants for the benefit of Tenant
and its Permittees a' temporary license to enter upon such parts of the Transit
Parcel as may be reasonably necessary for the performance of the Work required
or permitted to be performed by Tenant under this Lease, subject to the
Landlord's approval, which shall not be unreasonably withheld or delayed, and
the following terms and conditions:
(i) Such license shall be in effect only during periods when actual Work is
being performed;
(ii) All Work shall be performed in accordance with Section 6(d) above; and
(iii) . Prior to exercising the license granted herein to enter the Transit Parcel to
commence Tenant's work, Tenant shall give at least thirty (30) days' prior
written notice ("Work Notice") to the Landlord of the anticipated entry
time and estimated duration.
7. INSURANCE.
(a) Landlord Insurance. Landlord shall maintain the insurance set forth in Section
ll(a)(i)(G) as part of its Maintenance Work obligation.
(b) Tenant Insurance.
(i) Premises. Tenant, with respect to the Premises and the operations thereon,
shall, at all times during the term of this Lease, maintain or cause to be
maintained with a financially responsible insurance company or
companies Comprehensive Commercial General Liability Insurance
against claims on account of bodily injury or death or property damage
occurring upon, in, on, or about the Premises, providing for a limit of not
less than Two Million Dollars ($2,000,000.00) for personal or bodily
injury or death per occurrence, for a limit of not less than Four Million
Dollars ($4,000,000.00) in the aggregate for personal or bodily injury or
death to any number of persons arising out of anyone occurrence, and for
an aggregate limit of not less than Two Million Dollars ($2,000,000.00) in
respect of any instance of property damage. Such insurance policy or
. policies shall name Landlord as an additional insured and contain a
provision that the same may not be canceled without at least thirty (30)
days' prior written notice being given by the insurer to all Parties. Tenant
agrees to furnish to the Landlord a certificate of insurance, prior to the
effective date of such policy and any renewals or extensions thereof,
evidencing thatthe insurance required is.in full force. and effect.
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(ii) Insurance Upon Commencement of Work. Prior to commencing any
Work on the Premises or Total Site, Tenant shall obtain or shall require its
contractor to obtain and thereafter maintain so long as any Work is being
performed, at least the following minimum insurance coverages:
(A) Commercial General and Commercial Auto Liability in the amount of
$1,000,000 per occurrence, $2,000,000 aggregate, including without
limitation: (1) Products/Completed Operations Coverage on an
occurrence basis, and (2) XCU Hazard Endorsement, if applicable; and
(B) Contractor's Protective Liability Insurance covering the contractor and
Tenant in the amount of$I,OOO,OOO per occurrence, $2,000,000 aggregate,
including without limitation: (1) Products/Completed Operations
Coverage on an occurrence basis, and (2) XCV Hazard Endorsement, if
applicable; and
(C) Builder's Risk Coverage.
(iii) Waiver of Claims and Subrogation. Notwithstanding any other provision
in this Lease to the contrary, Landlord and Tenant hereby release each
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 covered by casualty insurance maintained by the
parties hereunder, even if such loss or damage shall have been caused by
the fault or negligence of the other party, or anyone for whom such party
may be responsible.
8. INDEMNIFICATION AND WAIVER.
Each party ("Indemnitor") covenants and agrees to indemnify, defend and hold harmless
the other party ("Indemnitee") from and against all claims, costs,. expenses and liability
(including reasonable attorneys' fees and cost of suit incurred in connection with all claims)
including any action or proceedings brought hereon, arising from or as a result of the death of, or
any accident, injury, loss or damage whatsoever caused to any person or entity, or to the property
of any person or entity which shall occur on the Parcel owned (excluding leased areas) or leased
by each Indemnitor, except to the extent such claims are caused by the negligent or the willful
act or omission of such Indemnitee, its licensees, concessionaires, agents, servants or employees,
or the agents, servants, or employees of any licensee or concessionaire thereof, wherever the
same may occur; provided Landlord's liability is limited by the limitation of liability contained
in Minnesota Statutes Chapter 466. Nothing in this section shall be deemed to be a waiver of the
liability limits applicable to Landlord in Minnesota Statutes Chapter 466 or other applicable
statutes.
9. LANDLORD'S REPRESENT A TrONS AND WARRANTIES.
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Landlord represents, warrants and covenants that:
(a) Landlord has the full power to carry out the transactions contemplated by this
Lease and all proceedings required to be taken on the part of Landlord to
authorize Landlord to execute and deliver this Lease to consummate the
transaction contemplated have been duly and validly taken.
(b) The execution, delivery and performance of the Lease will not conflict with
Landlord's governing documents, and will not conflict or result in a breach of
default under any note, lease, mortgage, indenture, contract or commitment to
which Landlord is a party or by which Landlord may be bound.
(c) There are no pending lawsuits which in any way affect title to the Transit Parcel
or the Premises, affect the organization or solvency of Landlord, or affect the
validity and enforceability of this Lease.
(d) This Lease does not violate or conflict in any way with the terms of any other
lease applicable to the Total Site or the terms of any reciprocal operating
agreement, cross easement agreement, restrictive covenants, or any other
document.
10. TENANT REPRESENTATIONS AND WARRANTIES.
Tenant represents, warrants and covenants:
(a) Tenant is a limited liability company in good standing organized and existing
under the laws of the State of Minnesota, that all actions necessary to authorize
the execution of this Lease have been taken by the Board of Governors and that
the manager executing this Lease has been duly authorized to execute this Lease.
(b) The execution, delivery and performance of this Lease will not conflict with
Tenant's company documents, and will not conflict or result in a breach of default
under any note, mortgage, indenture, contract or commitment to which Tenant is a
party or by which Tenant may be bound.
(c) There are no pending lawsuits which in any way affect the organization or
solvency of Tenant, or affect the validity and enforceability of this Lease.
11. REPAIRS AND MAINTENANCE OF IMPROVEMENTS.
(a) Landlord.
Commencing with substantial completion of Tenant's Buildings, the Landlord shall
repair and maintairi, or cause to.he repaired and maintaintd, the Transit Parcel to the standards of
maintenance followed in other comparable parking facilities of comparable size and use in the
suburban 'Minneapolis/St. Paul metr.op6litan area. The Transit Parcel shall be maintained in
14
~
compliance with all applicable governmental laws, rules, regulations, ordinance, orders and
provisions of this Lease. All Transit Parcel repairs or replacements shall use materials at least
equal to the quality of the materials repaired or replaced. Landlord's maintenance and repair
obligation shall include, without limitation, the following maintenance work and capital
replacement work:
(i) Maintenance Work.
(A) Maintaining all drive aisles and p~ved surfaces of the Transit Parcel,
which maintenance work shall be undertaken in intervals determined by
Landlord and shall include, without limitation, cleaning, sweeping,
restriping and repairing the parking areas using surfacing material of a
quality equal or superior to the original surfacing material.
(B) Periodic removal of all papers, debris, filth, refuse, ice and/or snow,
including sweeping to the extent necessary to keep the Transit Parcel in a
reasonably first-class, clean and orderly condition. Upon cessation of a
snowfall, the driveways, sidewalks (except the sidewalks adjacent to the
Premises) and parking areas shall be plowed.
(C) Placing, keeping in repair and replacing any appropriate directional signs,
marker;s and lines, including keeping clearly marked fire lanes, loading
zones, restricted parking areas and pedestrian cross-walks.
(D) Keeping in repair such lighting facilities and security services as may be
reasonably required.
(E) Maintaining all landscaped areas, repairing automatic landscape sprinkler
systems or water lines in the Transit Parcel, and making replacement of
shrubs and other landscaping as necessary.
(F) Cleaning, maintaining and repairing of sidewalks, excluding those
adjacent to the Premises.
(G) Maintaining at all times during the term of this Lease general liability
insurance against claims on account of bodily injury or death and property
damage occurring upon, in, on or about the Total Site, in the amount of
the limits of liability applicable to Landlord under the Minnesota Statutes
Chapter 466 or other similar statutes. Tenant shall be named as an
additional insured under the terms of the policy and the policy shall
contain a provision that it may not be cancelled without at least thirty (30)
days prior written notice being given by the insurer to all Parties. The
premium for said policy to the extent applicable to the Total Site shall be
included in Maintenance Costs (as herein<lXter defined). Landlord agrees
to furnish Tenant a -Certificate of Insurance, and prior to the effective date
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of such policy and' renewals or extensions thereof, evidencing that the
insurance required is in full force and effect.
(H) Cleaning, replacing, repairing and maintaining in a safe condition all
Utilities that serve both the Premises and the Transit Parcel, except that
Tenant shall clean, repair and maintain Utilities located on the Premises
from the point of connection as accessed on Exhibit E.
(ii) Capital Replacement Work.
(A) Repairing and replacing when necessary all drive aisles and paved
surfaces of the Transit Parcel which shall include, without limitation,
overlaying, resealing, and restriping the parking areas using surfacing
material of a quality equal or superior to the original surfacing material.
(B) Replacing when necessary such lighting facilities (including, without
limitation, light standards, wires, conduits, lamps, ballasts and lenses in
circuit breakers) and security services as may be reasonably required.
(C) Major landscaping replacement when necessary.
(D) Replacing when necessary Utilities that serve both the Premises and
Transit Parcel, except that Tenant shall be responsible for replacing
Utilities that are located on the Premises from the point' of connection as
accessed on Exhibit E and serve only the Premises.
(E) Landlord will provide Tenant with at least thirty (30) days notice prior to
undertaking Capital Replacement Work which consists of replacing or
repaving any of the drive aisles or paved surfaces of the Transit Parcel.
Such notice will include Landlord's reasonable estimate of the cost of such
Capital Replacement Work.
(b) Tenant.
Except as otherwise provided in this Lease, Tenant, at its sole cost and expense and
throughout the term of this Lease shall keep and maintain the Premises to the standards and
maintenance followed in other first class shopping centers in the suburban Minneapolis/St. Paul
metropolitan area. The maintenance and repairs by Tenant shall include all necessary repairs to
the Premises, including without limitation, sidewalks adjacent to the Premises, the footings and
foundations, roof, external walls and structural steel columns and steel girders forming a part of
the Premises, doors, windows and other apertures, hot water heaters, roof fans, plumbing and
electrical systems and fixtures, Tenant improvements, betterments and other special equipment
of Tenant attached to the Premises, glass, loading dock bumpers and levelers, and carpeting, in
good order and condition. ordinary wear and tear excepted. free of clirt and rubbish, and shall
promptly make all repairs necessary to keep and maintain such good order and condition,
ordinary wear and tear excepted whether such repairs arc ordinary or extraordinary. f()resccn,or
16
unforeseen. When used in this Section 11 (b) the term repairs shall include replacements and
renewals as necessary. All repairs made by Tenant shall utilize materials and equipment which
are at least equal in quality and usefulness as those originally used in constructing the Tenant's
Building and the Premises. Tenant shall further maintain the Utilities on the Premises provided
Tenant uses the access areas as shown on Exhibit E. Tenant shall further service, repair and
maintain HV AC equipment, including any underground associated piping, any fIre suppression
system (including alarm monitoring) and any other service which pertains to the Premises.
(i) Maintenance Costs. Except for Utilitiy Maintenance Tenant shall pay as
Additional Rent to Landlord its all costs and expenses incurred in
connection with the Maintenance Work ("Maintenance Costs")
attributable to the Premises incurred during each calendar year during the
term of this Lease.
(ii) Maintenance Costs for Utilities. Tenant shall pay as Additional Rent to
Landlord seventy-fIve percent (75%) of all costs and expenses incurred in
connection with Maintenance Costs for Utilities that serve the Transit Parcel in
addition to being responsible for Utility Maintenance as set forth in the last
sentence of paragraph 1 1 (a)(i)(H) above.
(iii) Capital Costs. In addition to the Maintenance Costs, except for Utility
Capital Costs Tenant shall pay all of the capital costs incurred in connection with
the Capital Replacement Work ("Capital Costs") attributable to the Premises.
Failure to pay such Capital Costs within sixty (60) days shall constitute a default
in the payment of rent pursuant to the terms of this Lease.
(iv) In addition Tenant shall pay as seventy-fIve percent (75%) of all costs and
expenses incurred in connection with Capital Replacement Work for Utilities that
serve the Transit Parcel in addition to being responsible for Utility Captial
Replacement Work as set forth in the paragraph 11 (a)(ii)(D) above.
(v) Default in Maintenance Work. In the event Landlord fails to perform any
Maintenance Work, then Tenant, fIfteen (15) days after written notice ("Work
Notice") to Landlord or upon reasonable notice in the event of an emergency,
shall have the right but not the obligation to perform that portion of the
Maintenance Work described in the Work Notice and Tenant shall recover a
proportionate contribution to the cost thereof from Landlord.
(vi) Items Excluded from Maintenance Costs and Capital Costs:
(F) Any advertising, promotional or marketing expenses incurred in
connection with the Total Site, the parking provided in the Total Site, the
park and ride programs, the ride/share programs, or public transportation
on or from the Total Site.
17
(G) Wages, costs and salaries associated with employees of Landlord other
than employees directly employed in the actual performance of
Maintenance Work or Capital Replacement Work.
(H) Costs incurred due to any violation by Landlord of any condition,
covenant or restriction affecting the Total Site or any laws, rules,
regulations or ordinances applicable to the Total Site.
(1) Penalties and interest for Landlord's late payment of any past due
Maintenance Costs or Capital Costs so long as not attributable to Tenant's
late payment.
(J) The initial cost of tools and equipment used in the maintenance of the
Total Site.
(K) Costs of structural repairs and replacements to the parking ramp structure
located on the Transit Site or to the transit station building.
(L) Cost of operating, maintaining, repairing, cleaning or protecting the transit
station building.
(M) Cost of construction of additions to the parking ramp.
(N) Expenses for repairs or replacements paid by proceeds of condemnation
awards or covered by warranties or guarantees.
(0) Costs which are subject to reimbursement by insurers.
(P) The cost of correcting defects in any improvements, excluding Tenant
improvements, now or hereafter located on the Total Site and repairs or
replacements caused by Landlord's negligence or the negligence of its
agents, employees or contractors.
(Q) Contributions to an account for future maintenance costs and capital costs
reserves.
(R) Costs of repairs, replacements, alterations or improvements necessary to
make the Total Site comply with applicable laws, including, without
limitation, requirements under the Americans with Disabilities Act, except
that Tenant shall pay all of such costs to the extent required by Tenant's
use of the Premises.
(iii) Tenant's Audit Rights. If, within 90 days after the Landlord's delivery of
the annual statcmcilt of the previous calendar ycar's Maintenance Costs
and Capital Costs, Tenant delivers to Landlord\vritten notice of its intent
to 'audit such cos'ts, Tcnclnt~, at its sole cost and expense, may cause an
18
employee, accountant or consultant of Tenant to audit Landlord's records
relating to the Maintenance Costs and Capital Costs for the previous
calendar year upon ten days written notice and during regular business
hours at Landlord's office. If the audit shows that the amount Landlord
charged Tenant for Tenant's share of Maintenance Costs and Capital Costs
was greater than the amount Tenant is obligated to pay hereunder,
Landlord will refund the excess amount to Tenant within ten days after
Landlord receives a copy of the audit report. If the audit shows that the
amount Landlord charged Tenant for Tenant's share of Maintenance Costs
and Capital Costs was less than the amount Tenant was obligated to pay
hereunder, Tenant will pay to Landlord the difference between the amount
Tenant paid and the amount determined in the audit within 30 days. If
Tenant does not provide such notice or does not perform an audit,
Landlord's written statement will be final and binding on Landlord and
Tenant 90 days after Landlord's delivery of the statement.
12. LIGHTING.
Unless otherwise agreed to by the Parties, Landlord hereby covenants and agrees to keep
the Common Area fully illuminated each day (except days on which businesses may not by law
be open) from dusk to at least one (1) hour after the closing of all businesses operated on the
Premises, and further agrees to keep security lights on thereafter until dawn unless the Premises
is fully or partially illuminated.
13. USES.
(a) Pennitted Uses. The Premises may be used for office and retail uses, which is
defined as retail and service uses typical to first class shopping centers in the Minneapolis/St.
Paul metropolitan area, except for the prohibited uses set forth in Section 13(b) below. Any uses
other than office/retail uses shall be subject to approval of Landlord in its sole discretion, which
approval shall be given or denied within fifteen (15) days of written request by Tenant. If
Landlord does not approve or disapprove the request within fifteen (15) days, Tenant may
provide a second notice of the request within five (5) business days after such fifteen (15) day
period, and if Landlord fails to approve or disapprove the request within five (5) business days of
the second notice, approval shall be deemed given. Any Occupant of the Premises shall have the
right to use in connection with such Occupant's business operations in the Premises, the
sidewalk area immediately adjacent to the portion of Tenant's Buildings that such Occupant is
entitled to occupy.
(b) Prohibited Uses. No use or operation will be made, conducted or permitted on or
with respect to all or any part of the Total Site that is inconsistent with the operation of an
office/retail center. Without limiting the generality of the foregoing, the following uses shall not
be permitted:
(i) Any lIse which. emits an obnoxious odor, i10ise or sound which can be
heanl.or smelled outside of any building on the Premises;
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(ii) Any operation used primarily as a storage warehouse operation and any
assembling, manufacturing, distilling, refIning, smelting, agricultural or
mining operation;
(iii) Any mobile home park, trailer court, labor camp, junkyard, or stockyard
other than the temporary use of construction trailers during periods of
Work;
(iv) Any dumping, disposing, incineration, or reduction of garbage (exclusive
of garbage dumpsters or compactors for garbage generated on the Total
Site);
(v) Any fIre sale, bankruptcy sale (unless pursuant to court order) or auction
house operation;
(iv) Any dry cleaning plant or self-service laundromat; provided, however, this
prohibition shall not be applicable to nominal supportive facilities for on-
site service oriented to pickup and delivery at the Premises by the ultimate
consumer as the same may be found in retail shopping districts in the
Minneapolis-St. Paul metropolitan area;
(v) Any automobile, truck, trailer or recreational vehicles sales, leasing,
display or body shop repair operation;
(vi) Any bowling alley, gymnasium or skating rink;
(vii) Any movie theater or live performance theater;
(viii) Any living quarters, sleeping apartments, or lodging rooms;
(ix) Any animal raising facilities (except that this prohibition shall not prohibit
pet shops or veterinary services);
(x) Any mortuary or funeral home;
(xi) "Adult only" store for the sale or rental of pornographic material or other
. sexually explicit material (provided that this restriction shall not preclude
the sale or rental of X rated or "NR" rated or similar materials as an
incidental part of the operation of bookstores or other multi-media stores);
(xii) Any bar, restaurant or other establishment which serves or sells alcoholic
beverages;
(xiii) Any flea market, car wash, or dance hall;
20
(xiv) Any gambling facility or operation other than the sale oflottery tickets;
(xv) Any gasoline service station or any facility which performs oil/lube
changes for automobiles;
(xvi) Any long term vehicle storage facility or facility for parking recreational
vehicles;
(xvii) Any business using or requiring outdoor storage;
(xviii) Any "second-hand" thrift store or pawn shop whose principal business is
selling discounted and used merchandise (other than an arcade, video,
compact disc, novelty, entertainment or similar resale store) such as a
salvation army type store, "goodwill" type store, or similar businesses;
(xix) Operation whose principal use is a massage parlor; provided this shall not
prohibit massages in connection with a beauty salon or health club or
athletic facility;
(xx) Tattoo parlor;
(xxi) Church, school (other than cooking and other home economic classes
conducted by any grocery store tenant or occupant of the Premises), or
related religious or educational facility;
(xxii) Restaurants which have employees with work uniforms or required
employee attire of a sexually provocative nature (e.g., existing operations
of a Hooters or Chippendale's restaurant).
14. UTILITIES.
Landlord covenants and agrees that all utility services (including, without limitation, gas,
electric, telephone, water, sewer) exclusively used by Tenant shall be separately metered to
Tenant and the costs of all utility services serving the Common Area or both the Premises and
the Transit Parcel (and not separately metered to the Premises) shall be included in the
Maintenance Costs. Tenant covenants and agrees that it shall pay the cost for utility services
exclusively serving the Premises. Should a break, malfunction or other disruption ("Disruption")
of utility service occur the costs to repair shall be allocated as set forth in Article 11 Both
Landlord and Tenant covenant and agree that a Disruption does not enable the Responsible Party
to discontinue service to the other party.
15. GOVERNMENTAL REGULATIONS.
Subject to I~andlord's obligation to maintain the Transit Parcel in accordance with
Section 11, Tenant shall observe and comply \vith all requirements, rules, ordersand regulations
21
of the federal, state and municipal governments or other duly constituted public authority
affecting the Premises.
16. DAMAGE AND DESTRUCTION.
(a) No damage to the Premises or damage to or destruction of any improvements
erected or placed at the Premises shall in any way alter, affect or modify Tenant's obligations
under this Lease, including Tenant's obligations to pay rent, taxes and other financial obligations
hereunder. In the event of any damage to the Premises, Tenant shall (a) give immediate written
notice of the damage or destruction to Landlord, which notice shall include a description of the
damage and, as far as known to Tenant, the cause of the damage, (b) promptly enforce all
provisions pertaining to such damage in any applicable permitted sublease, and (c) take such
action as may be required under applicable municipal ordinances and other laws, rules and
regulations with respect to any such damage or destruction. Tenant shall also be obligated to act
promptly, but no later than ten (10) days from the date of the damage or destruction, to remove
all debris resulting from such damage or destruction and take such action as is necessary to place
the Premises in a neat, safe condition. If Tenant fails to remove all such debris or take such
action as is necessary to place the Premises in a neat, safe condition within ten (10) days
following such damage or destruction (and in all events prior to the expiration of any applicable
time period established by law, ordinance, rule or other applicable regulation for the removal,
clean-up, repair or other required action with respect to such damage or destruction) Landlord
shall have the right (but not the obligation) to do so, whereupon Tenant shall be liable to pay
Landlord, upon demand, the cost and expense incurred by Landlord. The failure by Tenant to
make such payment to Landlord may be treated by Landlord as a default in the payment of rent
due and owing by Tenant hereunder.
(b) In the event that any improvement constructed on the Premises is damaged by
fire, earthquake, flood or other casualty, or by any other cause of any kind or nature and less than
fifty percent (50%) of the Premises is unusable for the conduct of Tenant's business, Tenant or
its subtenant, as applicable, shall be obligated to repair and reconstruct such improvements and
to commence such reconstruction and repair work promptly and work diligently to restore the
Premises as a complete architectural unit of substantially the same usefulness, design and
construction existing immediately prior to the damage, including Tenant's or the subtenant's
trade fixtures, or Tenant-owned or subtenant-owned alterations and utility installations. The
provisions of Section 6 of this Lease shall also apply to repair and reconstruction work under this
Section 16. Tenant agrees to apply insurance proceeds to the restoration and loss of use of the
Premises. Tenant shall commence repair and reconstruction on the earlier of (a) within 30 days
following the date Tenant receives payment from its insurance carrier or (b) nine (9) months
from the date the damage occurs, and shall substantially complete the repair and reconstruction
within six (6) months thereafter (the "Restoration Period"). Any failure by Tenant to complete
restoration of the Premises before the expiration of the Restoration Period shall be a default
under Section 20 below (a Restoration Default) and Landlord shall have all remedies available to
it in accordance with Section 20. Notwithstanding the foregoing or anything to the contrary in
Section 20. Landlord shall not be obligated!O provide any written notice of. and-right to,'ure, the
Restoration Default as might otherwise be required in Section 20(a).
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( c) If the Premises is damaged by fire, earthquake, flood or other casualty, or by any
other cause of any kind or nature, so that the Premises are more than fifty percent (50%)
unusable for the conduct of Tenant's business, Tenant, with the consent of the Leasehold
Mortgagee, may terminate this Lease upon written notice to the Landlord as soon as reasonably
possible, and no later than forty-five (45) days from the date of the damage and destruction. If
the Tenant terminates the Lease pursuant to this Section 16(c), rent shall be due only to the date
of Ten ant delivery of the Premises to Landlord, and Tenant shall surrender the Premises without
any occupants as soon as reasonably possible to Landlord and shall provide evidence to Landlord
that all subleases have been terminated. In the event Tenant elects not to terminate the Lease,
but elects to repair and restore, such repair and restoration shall be completed pursuant to Section
16(b) herein.
(d) Notwithstanding the foregoing, Tenant may terminate this Lease if (i) the
Premises are damaged during the last year of the Lease Term and (ii) Tenant reasonably
estimates it will take more than two months to repair the damage, and Tenant provides Landlord
with a written notice of termination of this Lease within thirty (30) days from the date of the
damage. Upon termination, rent shall be due only to the date of surrender of the Premises and
Tenant shall surrender the Premises without any occupants as soon as reasonably possible to
Landlord and shall provide evidence to Landlord that all subleases have been terminated.
(e) Tenant shall include provisions no more favorable to any subtenant than the
provisions contained in this Section 16 in all subleases of the Premises.
17. EMINENT DOMAIN.
(a) Building. If all or part of Tenant's Buildings shall be taken by any public
authority by right of eminent domain or conveyed in lieu thereof and such taking materially and
adversely impairs the viability and operation of the remaining portion of Tenant's Buildings, if
any, (a "Taking"), then Tenant shall have the option to terminate this Lease as of the date Tenant
shall be dispossessed from the part so taken by giving written notice to Landlord of such.election
so to terminate the Lease within ninety (90) days from the date of such Taking.
(b) Parking. If any portion of the Exclusive Parking Area shall be expropriated by a
Taking, Landlord shall have the right, but not the obligation to designate alternative parking
stalls at Tenant's expense for the exclusive use of Tenant and its Permittees, in a location
acceptable to Tenant, and Landlord shall post retail parking only signage on the area of such
alternative exclusive parking stalls in accordance with Section 2(b). Landlord shall not be
required to post a sign for each stall. If Landlord designates exclusive parking stalls, Tenant
shall pay to Landlord for such stalls the amount of the condemnation award allocable to the
number of parking spaces so taken and being replaced by Landlord. If all or part of the
Exclusive Parking Area shall be eliminated by the Taking and Landlord has declined to designate
alternative parking stalls in an area acceptable to Tenant (such stalls shall be considered part of
the Exclusive Parking Area for purposes of their paragraph) to replace each of the parking stalls
taken from Tenant, then Tenant shall have the nptiOl1"to terminate this Lease as of the date such
parking areas shall be expropriated by such T:rking by giving wlitten notice to Landlord of its
election so to termlnatetheLease within ninety(90) days from th'c date OfSllCh Taking.
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(c) Tenant's Buildings/Ingress and Egress. If the points of ingress and egress to the
public roadways, substantially as depicted on the Site Plan, shall be materially impaired by a
Taking so as to render the Premises unsuitable for its permitted use, and if reasonably equivalent
points of ingress and egress are not substituted for the points so taken within ninety (90) days,
then Tenant shall have the option to terminate this Lease as of the date Tenant shall be deprived
or denied thereof.
(d) Restoration. In the event of a Taking of any portion of Tenant's Buildings and if
this Lease shall not be terminated as provided above, this Lease shall continue as to that portion
of the Premises which shall not have been expropriated, and Tenant shall, promptly and with due
diligence, restore Tenant's Buildings, as nearly as practicable, to a complete unit oflike quality
and character as existed just prior to such expropriation. Annual Rent shall be reduced in the
proportion that the area of the portion of the Premises so expropriated shall bear to the area of the
Premises prior to such expropriation, such reduction to be effective as of the date of
expropriation.
(e) Termination. If this Lease shall be terminated pursuant to this Section, then any
Annual Rent, Additional Rent and any other charges paid in advance shall be refunded to Tenant.
(f) Taking A ward. Except as provided for in the following sentence, in the event of a
Taking, the entire award paid by the condemning authority (after payment of expenses incurred
in connection with collecting the same) shall be the property of Landlord. Nothing herein
contained shall be construed as preventing Tenant from being entitled to any separate award
made to Tenant for the taking of Tenant's Buildings, any Tenant improvements, parking stalls,
personal property, inventory or trade fixtures of Ten ant, or the loss of its leasehold interest in the
Premises or from claiming its award directly against the condemnor.
18. TRANSFER OF LANDLORD'S INTEREST.
Should Landlord sell or assign this Lease (other than a conditional assignment as security
for a loan), then Landlord, as transferor, shall be relieved of any and all covenants, obligations
and undertakings on the part of Landlord accruing under this Lease from and after the date of
such transfer provided that Landlord's successor in interest shall assume such obligations from
and after such date of transfer. Notwithstanding the foregoing, until Landlord notifies Tenant in
writing of the name and address of the transferee and the date of such transfer, Landlord's
liability shall continue with respect to any portion sold or assigned and Landlord shall (for the
purpose of this Lease only) be the transferee's agent. Nothing contained herein to the contrary
shall affect the existence, priority, validity or enforceability of any lien permitted hereunder
which is placed upon the Parcel being transferred prior to receipt of notice.
19. ASSIGNMENT AND SUBLETTING.
.-(a) Assi!mment. There shall be no Assignment of all or a :portion of this Lease by
Tenant without in each cascohtaining the prior written conseilt of Landlord, which consent m(~y
24
be withheld or conditioned at Landlord's reasonable discretion. In connection with a request by
Tenant to assign this Lease:
(i) Tenant shall give Landlord at least forty-five (45) days prior written notice
of the Assignment; if Landlord does not approve or disapprove of the
Assignment within fifteen (15) days, Tenant may provide a second notice
of the proposed Assignment to Landlord and if Landlord fails to approve
or disapprove of the Assignment within five (5) business days of the
receipt of the second notice, the Assignment shall be deemed approved;
(ii) No event of default, or state of facts or circumstances which, with the
giving of notice or lapse of time or both, would constitute an event of
default, shall be in existence at the time such notice is given or at the time
of such assignment;
(iii) The Assignment shall be in form and substance acceptable to Landlord;
(iv) All deferred maintenance on the Premises reasonably determined by
Landlord to be necessary shall have been completed at the time of such
Assignment.
(v) If the Assignment is approved Tenant shall pay to Landlord fifty percent
(50%) of any amount by which the consideration received by Tenant
pursuant to a Assignment exceeds, in any month, the Base Rent then
required to be paid hereunder, shall be paid by Tenant directly to Landlord
as Additional Rent hereunder on or before the first day of each such
month. .
It is expressly agreed by Tenant that is shall be reasonable for Landlord and Landlord shall be
entitled to withhold its consent to any proposed assignment of this Lease if any of the following
applies: (i) the assignee is an entity describe on or engaged in a business described in Article 13
(b); (ii) in Landlord's reasonable business judgment, the assignee is of a character or reputation
or engaged in a business which is not consistent with the quality and reputation of the Transit
Parcel; (ii) the net worth of the assignee as of the date of the notice of the proposed Assignment.
is given pursuant to this Lease or as of the consummation of the Assignment and any transactions
related thereto, is or will be less than the tangible net worth of the Tenant as of the date of this
Lease, or (iii) that the Assignee and/or the management company which the Assignee will
engage to manage the Premises does not have equal or greater experience owning and
managing properties comparable to the Premises than that of Tenant and its Chief Manager.
Tenant shall remain liable and responsible hereunder not withstanding any Assignment of its
ownership interests. Any change in the legal entity comprising Tenant shall be deemed an
Assignment, except the following changes: (i) transfers and changes in the ownership of Tenant
necessitated by devise ,)1' descent or for estate planning purposes; orCii) transfers and changes of
ownership of Tenant \vhich aggregate less than voting control in Tenant; or (iii) transfer or
changes of ownership interest in Tenant, provided thnt aHer such transfer or change Thomas
Baker and/or hiscsla"le, and/or members of his iml11cdiatC"l~1l11ily, and/or trusts fl.)r the'benefit of
25
Thomas Baker and/or members of his immediate family continue to own individually or jointly
with his spouse at least fifty-one percent (51 %) of such ownership interests. Notwithstanding the
foregoing, in the event the Leasehold Mortgagee (or its nominee) obtains title to the Lease
pursuant to foreclosure or a deed in lieu of foreclosure, Landlord shall have no right to contest
such transfer; in the event the Leasehold Mortgagee (or its nominee) proposes to transfer such
leasehold interests, it shall provide Landlord with thirty (30) days notice of the proposed transfer
and provide Landlord a right of first refusal to purchase such leasehold interest on the same
terms as between the Leasehold Mortgagee and its buyer, which right must be exercised by
written notice to the Leasehold Mortgagee (or its nominee) within said thirty (30) day period.
(b) Subleasing. There shall be no Sublease of all or a portion of the Premises without in each
case the prior written consent of Landlord. Tenant shall provide at least thirty (30) days prior
written notice to Landlord of each proposed sublease, including initial and subsequent subleases
for each sublease space. If Landlord does not approve or disapprove the sublease within fifteen
(15) days of the written notice, Tenant may provide a second notice of the proposed sublease to
Landlord and if Landlord fails to approve or disapprove within five (5) business days of the
second notice, the sublease shall be deemed approved. It is expressly agreed by Tenant that is
shall be reasonable for Landlord and Landlord shall be entitled to withhold its consent to any
proposed sublease if any of the following applies: (i) the subtenant is an entity describe on or
engaged in a business described in Article 13(b); (ii) in Landlord's reasonable business
judgment, the assignee is of a character or reputation or engaged in a business which is not
consistent with the quality and reputation of the Transit Parcel; (iii) if in the Landlord's
reasonable business judgment the sublease or the subtenant is not compatible with the
Landlord's use of the Transit Parcel; (iv) if in the Landlord's reasonable business judgment the
sublease or the subtenant use is inconsistent with the uses and provisions of this Lease; (iv) the
proposed subtenant is not a credit worthy tenant consistent with tenants in a first class
retail/office center; (vi) the proposed subtenant is a not reputable tenant consistent with the
reputation of tenants in a first class retail/office center; or (vii) the proposed subtenant does not
have experience in retail/office projects similar to the project on the Premises. Tenant shall
remain liable and responsible hereunder not withstanding any Assignment of its ownership
interests. If the sublease is approved Tenant shall pay to Landlord fifty percent (50%) of any
amount by which the consideration received by Tenant pursuant to a sublease exceeds, in any
month, the Base Rent then required to be paid hereunder, shall be paid by Tenant directly to
Landlord as Additional Rent hereunder on or before the first day of each such month.. Landlord
agrees to execute a non-disturbance agreement with subtenants approved by Landlord in a form
acceptable to Landlord and subtenant.
(c) Consent to Assignment or Consnet to Sublease. Notwithstanding anything to the
contrary in this section, no Assignment or Sublease by Tenant shall become effective until
Tenant and any proposed assignee or subtenant has executed 'and delivered to Landlord a
Consent to Assignment or Consent to Sublease, as appropriate, by and among Tenant, such
proposed assignee or subtenant and Landlord in form reasonably acceptable to Landlord.
(d) Landlord's Attorney- Fees. Tenant shall reimburse Landlord for the reasonale
attorney's fees incurred by Landlord in connection with any such proposed Assignment or
Sublease.
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20. TENANT'S DEFAULT AND LANDLORD'S REMEDIES.
(a) The occurrence of the following shall constitute an event of default under this
Lease: If Tenant fails to pay any monetary obligation due hereunder within ten (10) days after
the same shall be due, or fails to perform any other term, condition or covenant of this Lease, or
if Tenant or an agent of Tenant shall falsify any report required to be furnished to Landlord
pursuant to the terms of this Lease, or if Tenant or any guarantor of this Lease shall become
bankrupt or insolvent, or file any debtor proceedings or any person shall file against Tenant or
any guarantor of this Lease in any court pursuant to any statute either of the United States or of
any state a petition in bankruptcy or insolvency or for reorganization or for the appointment of a
receiver or trustee of all or a portion of Tenant's or any such guarantor's property, or if Tenant or
any such guarantor makes an assignment for the benefit of creditors, or petitions for or enters
into an arrangement, or if Tenant shall abandon the Premises or suffer this Lease to be taken
under any writ of execution, then in any such event Tenant shall be in default hereunder.
(b) Landlord shall provide written notice to Tenant of the occurrence of a monetary
default and Tenant shall have 30 days after written notice to cure such default; and shall provide
written notice of a non-monetary default and Tenant shall have 30 days to cure (or such longer
period not to exceed an additional 90 days as may be required to cure such non-monetary default
provided Tenant immediately commences to cure and thereafter diligently pursues the same to
completion).
(c) Upon occurrence of an event of default and Tenant's failure to cure:
Landlord, in addition to other rights or remedies it may have, shall have the
immediate right of re-entry and may remove all persons and property from the
Premises and such property may be removed and stored in a public warehouse or
elsewhere at the cost of, and for the account of Tenant, all without service of
notice or resort to legal process and without being guilty of trespass, or becoming
liable for any loss or damage which may be occasioned thereby.
Should Landlord elect to re-enter the Premises as herein provided, or should it
take possession of the Premises pursuant to legal proceedings or pursuant to any
notice provided for by law, it may either terminate this Lease or it may from time
to time, without terminating this Lease, make such alterations and repairs as may
be necessary in order to relet the Premises, and relet the Premises or any part
thereof for such term or terms (which may be for a term extending beyond the
term of this Lease) and at such rental or rentals and upon such other terms and
conditions as Landlord in its sole discretion may deem advisable. Upon each such
reletting all rental received by the Landlord from such reletting shall be applied
first to the payment of any indebtedness other than Annual Rent and Additional
Rent due hereunder from Tenant to Landlord: second. to the payment of any costs
and expenses Df such rektting. including br"okerag~ fees and attorney's fees and
of C')sts of such alterations and repairs; third. to the payment of residue and
unpaid Annual "Rent and :Additional Rent or any "other amount due hereunder.
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Any residue shall be held by Landlord and applied in payment of future Annual
Rent and Additional Rent as the same may become due and payable hereunder. If
such rentals received from such reletting during any month be less than that to be
paid during that month by Tenant hereunder, Tenant, upon demand, shall pay any
such deficiency to Landlord. No such re-entry or taking possession of the
Premises by Landlord shall be construed as an election on its part to terminate this
Lease unless a written notice of such intention be given to Tenant or unless the
termination thereof be decreed by a court of competent jurisdiction.
Notwithstanding any such reletting without termination, Landlord may at any
time after such re-entry and reletting elect to terminate this Lease for such
previous breach. Should Landlord at any time terminate this Lease for any such
breach, in addition to any other remedies it may have, it may recover from Tenant
all damages it may incur by reason of such breach, including the cost of
recovering the Premises, reasonable attorney's fees, and including the worth at the
time of such termination of the excess, if any, of the amount of rent and charges
equivalent to rent reserved in this Lease for the remainder of the stated term over
the then reasonable rental value of the Premises for the remainder of the stated
term, all of which amounts shall be immediately due and payable from Tenant to
Landlord.
Landlord may, at its option, instead of exercising any other rights or remedies
available to it in this Lease or otherwise by law, statute or equity, spend such
money as is reasonably necessary to cure any default of Tenant herein and the
amount so spent, and costs incurred, including attorney's fees in curing such
default, shall be paid by Tenant, as Additional Rent, upon demand.
(i) If suit shall be brought for recovery of possession of the Premises, for the
recovery of Annual Rent, Additional Rent, or any other amount due under the
provisions of this Lease, or because of the breach of any other covenant herein
contained on the part of Tenant to be kept or performed, and a breach shall be
established, Tenant shall pay to Landlord all expenses incurred therefor, including
reasonable attorney's fees, together with interest on all such expenses at the
Default Rate from the date of such breach of the covenants of this Lease.
No remedy herein or elsewhere in this Lease or otherwise by law, statute. or equity,
conferred upon or reserved to Landlord or Tenant shall be exclusive of any other remedy, but
shall be cumulative, and may be exercised from time to time and as often as the occasion may
anse.
21. TENANT'S REMEDIES.
In the event Landlord shall neglect to pay when due any obligations on any mortgage or
encumbrance affecting title to the Premises, or in the event Landlord shall fail to perfonn any
Maintenance Work, Capital Replacement Work, or other obligation specified in.this Lease, or if
Landlord shall be in default of any represcntation, \varranty, or covenant of Landlord, then
Tcnant may, after the continuancc. of aJ1y~;uch dcfault for thirty (30) day;; after writtcn notice
28
("Work Notice") thereof by Tenant to Landlord (or, in the case ofa non-monetary default, such
longer period as may be required to cure such default provided Landlord commences to cure
such default within such thirty (30) day period and thereafter diligently pursues the same to
completion), or upon reasonable notice in the event of an emergency, make any necessary
payments or perform any obligation specified in the Work Notice to cure such default, all on
behalf of and at the expense of Landlord. Landlord shall, on demand, pay Tenant, forthwith, the
amount so paid by Tenant and the costs incurred by Tenant in connection with Tenant's
performance of any obligation specified in the Work Notice.
22. COVENANT OF TITLE.
(a) Quiet Enjoyment. Landlord covenants, represents and warrants that it has full
right and power to execute and perform this Lease and to grant the estate demised herein and that
Tenant, on payment of the Annual Rent and Additional Rent and performance of the covenants
and agreements hereof, shall peaceably and quietly have, hold and enjoy the Premises and all
rights, easements, appurtenances and privileges belonging thereto during the Lease term without
molestation or hindrance of any person whomsoever, and if, at any time during the term hereby
demised the title of Landlord shall fail or it be discovered that its title shall not enable Landlord
to grant the term hereby demised, then Tenant shall have the option, at Landlord's expense, to
correct such defect or to annul and void this Lease with full reservation of its right to damages, if
any.
(b) Title. Landlord further covenants, represents and warrants that Landlord will be
seized of an indefeasible estate in fee simple in and to the Premises and the Transit Parcel, free
and clear of any liens, encumbrances, restrictions and violations (or claims or notices thereof),
except for those items of listed on Exhibit F attached hereto (collectively, "Permitted
Exceptions").
(c) Subordination. Nondisturbance and Attornment. This Lease and all rights of
Tenant hereunder are expressly subject and subordinate to the lien of any mortgage (each a
"Mortgage") that may now exist or may hereafter be placed upon the Landlord's interest in the
Premises, provided, however, that, notwithstanding such subordination, Tenant's possession and
quiet enjoyment of the Premises shall not be disturbed by any holder of a Mortgage so long as
Tenant is not in default, after the expiration of any cure or grace periods applicable thereto, in
performance of its obligations under this Lease. Tenant agrees to deliver to Landlord, within ten
(10) business days after receipt of a written demand, a waiver of priority or a subordination of
this Lease, in recordable form, subordinating Tenant's rights hereunder to the lien of a Mortgage;
provided, however, that any such document shall provide the agreement of the holder of such
Mortgage that: .
(i) The holder of such Mortgage will not disturb Tenant's possession and
quiet enjoyment of the Premises under this Lease so long as Tenant is not in default, after
the expiration of any cure or grace period applicable thereto, in the performance of its
obligation under this Lease;
29
(ii) If the Mortgagee acquires title to the Premises, the holder of such
Mortgage will accept the Tenant as Tenant of the Premises under the terms and
conditions of this Lease and Tenant shall recognize such holder as the landlord
hereunder.
(d) Estoppel Certificate. Landlord and Tenant shall execute and deliver to the other
party to this Lease, within fifteen (15) business days after written request by such other party, a
written certificate stating, if true, as of the date of such certificate: (i) that this Lease is in full
force and effect and has not been modified, altered, amended, sublet or assigned (or, if it has,
then specifying the dates and terms of any such amendment or any such transfer), (ii) that this
Lease constitutes the full agreement between the parties, (iii) that the certifying party, and, to the
certifying party's actual knowledge (excluding any imputed or constructive knowledge), the
other party to this Lease is not in default under this Lease and no situation exists that could, with
the passage of time or the giving of notice (or both), constitute a default hereunder, or, if such is
not the case, stating the nature of the default, (iv) the Annual Rent and other charges payable by
Tenant and the dates to which such amounts have been paid, (v) the Commencement Date and
the date on which the Initial Term expires, (vi) whether the Extension Option has been exercised
pursuant to Section 3 (b) of this Lease, and (vii) any other factual information pertaining to the
Lease reasonably requested by Landlord or Tenant.
23. LEASEHOLD MORTGAGE.
(a) Tenant shall have the unrestricted right at any time and from time to time to
mortgage its leasehold interest under this Lease (but not Landlord's fee interest), subject
however to the limitations hereinafter set forth. Any such mortgage or other encumbrance shall
be subject and subordinate to the rights of Landlord and Landlord's mortgagee, subject to this
Section 23.
(b) No Leasehold Mortgagee shall be entitled to enjoy the rights or benefits
mentioned herein, nor shall the provisions of this Lease pertaining to Leasehold Mortgages be
binding upon Landlord, unless Landlord shall have been given written notice of the name and
address of the Leasehold Mortgagee.
(c) So long as such Leasehold Mortgage shall remam m effect, the following
provisions shall apply:
(i) Landlord shall serve a copy of any notice, including a notice of default,
required to be served on Tenant under this Lease upon such Leasehold
Mortgagee at the address provided in the notice referred to in
subparagraph (b) hereof, and no notice by Landlord to Tenant hereunder
shall be deemed to have been duly given unless and until a copy thereof
has been served on the Leasehold Mortgagee.
(ii) In the event of a default by Tenant hereunder, any Leasehold Mortgagee
(or its agents) shall, within the period allO\ved Tenant 10 cure such default
. ami otherwise as herein provided, ha\'~ the right to cure such default, or
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cause the same to be cured, and Landlord shall accept such performance
by or on behalf of such Leasehold Mortgagee as if the same had been
made by Tenant.
(iii) Notwithstanding the foregoing, upon the occurrence of an event of default,
Landlord shall take no action to terminate this Lease without first giving to
the Leasehold Mortgagee written notice thereof as required in Section
23( c )(i) herein and, in the event of a monetary default, a period of thirty
(30) business days after written notice to the Tenant and the Leasehold
Mortgagee to cure such default, or in the case of a non-monetary default,
thirty (30) days after written notice to the Tenant and the Leasehold
Mortgagee as required in Section 23(c)(i) herein within which to cure such
default (or such longer period not to exceed an additional thirty (30) days
as may be required to cure such non-monetary default provided the
Leasehold Mortgagee immediately commences to cure and thereafter
diligently pursues the same to completion); provided, however, that: (I)
such Leasehold Mortgagee shall not be obligated to continue such
possession or to continue such foreclosure proceedings after such defaults
shall have been cured; and (2) nothing herein contained shall preclude
Landlord, subject to the provisions of this Section 23, from exercising any
rights or remedies under this Lease with respect to any other default by
Tenant. Such Leasehold Mortgagee or other purchaser in foreclosure
proceedings may become the legal owner and holder of Tenant's interest
under this Lease by foreclosure or assignment in lieu of foreclosure.
24. HAZARDOUS MATERIAL.
No Party shall use, or permit the use of Hazardous Materials on, about, under or in its
Parcel or the Total Site, except for diminimus amounts used in the ordinary course of its usual
business operations conducted thereon and except for amounts used in the operation and
maintenance of Landlord's transit operations, and any such use shall at all times be in
compliance with all Environmental Laws. Each Party shall indemnify, protect, defend and hold
harmless the other Party from and against all claims, suits, actions, demands, costs, damages and
losses of any kind, including but not limited to costs of investigation, litigation and remedial
response, arising out of any Hazardous Material used or permitted to be used by such Party
whether or not in the ordinary course of business; provided Landlord's liability is limited by the
limitation of liability contained in Minnesota Statutes Chapter 466. Nothing in this section shall
be deemed to be a waiver of the liability limits applicable to Landlord in Minnesota Statutes
Chapter 466 or other applicable laws. For the purposes of this Section 24, the term (i)
"Hazardous Materials" shall mean: petroleum products, asbestos, polychlorinated biphenyls,
radioactive materials and all other dangerous, toxic, hazardous pollutants, contaminants,
chemicals, materials, or substance listed or identified in, or regulated by, any Environmental
Law, and (ii) "Environmental Laws" shall mean: all federal, state, county, municipal, local and
other statutes; laws, ordinances and regulations which relate to or dea 1 Wit~l human health or the
environment, all as may be amended from time to time.
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25. CONDITION OF PREMISES AT TERMINATION.
At the expiration or earlier termination of the Lease term, Tenant shall surrender the
Premises, and remove all structure(s) from the Premises, so that the Property is returned to its
condition as of the date of this Lease. All costs associated with such removal and restoration
shall be at Tenant's sole expense.
26. HOLDING OVER.
In the absence of any written agreement to the contrary, if Tenant should remain in,
occupancy of the Premises after the expiration of the Lease term, it shall so remain as a tenant
from month-to-month and all provisions of this Lease applicable to such tenancy shall remain in
full force and effect, except that Annual Rent payable during such holdover tenancy shall be one
hundred fifty percent (150%) of the Annual Rent and Additional Rent payable at the end of the
Lease term.
27. NOTICES.
All notices, demands and other communications required or permitted to be given under
this Lease shall be in writing and shall be deemed to be given when delivered (or, if delivery is
refused, on the date delivery was attempted) if sent by recognized overnight courier, or upon
three (3) business days after deposit in the U.S. Mail if sent by certified or registered mail,
postage prepaid. All notices shall be addressed to Landlord and Tenant at the following
addresses:
Landlord:
Southwest Metro Transit Commission
13500 Technology Drive
Eden Prairie, MN 55344
Attention: Len Simich, Executive Director
With a copy to:
Gregerson, Rosow, Johnson & Nilan, Ltd.
1600 Park Building
650 Third Avenue South
Minneapolis, MN 55402
Attention: Richard F. Rosow
Tenant:
Apogee Investments Chanhassen, L.L.C.
Wilha.copyto:
32
#
28. PARTIAL INVALIDITY.
If any term, covenant or condition of this Lease or the application thereof to any person
or circumstance shall, to any extent, be invalid or unenforceable, then the remainder of this Lease
or the application of such term, covenant or condition to persons or circumstances other than
those as to which it is held invalid or unenforceable shall not be affected thereby and each term,
covenant or condition of this Lease shall be valid and be enforced.
29. ENTIRE AGREEMENT - APPLICABLE LAW.
This Lease, the exhibits and amendments or addendums, if any, attached hereto and
forming a part hereof, set forth all the covenants, promises, agreements, conditions, provisions
and understandings between Landlord and Tenant concerning the Premises and there are no
covenants, promises, agreements, conditions, provisions or understandings, either oral or written,
between them other than as herein set forth. No alteration, amendment, change or addition to
this Lease shall be binding upon Landlord or Tenant unless reduced to writing and signed by
each party. This Lease shall be governed by and construed in accordance with the laws of the
State of Minnesota.
30. SUCCESSORS AND ASSIGNS.
The conditions, covenants and agreements contained in this Lease shall be binding upon
and inure to the benefit of the Parties and their respective heirs, executors, administrators,
successors and assigns. The covenants, restrictions, benefits and obligations under this Lease
shall be deemed to create mutual and reciprocal benefits and servitudes upon the Total Site,
which shall run with and against said property and be a benefit and burden thereon, and shall be
binding upon all Occupants of the Total Site for so long as this Lease remains in effect. Said
covenants, restrictions, benefits and obligations shall cease and be of no further force or effect
after the termination of this Lease.
31. MEMORANDUM OF LEASE.
The Parties shall upon execution of this Lease execute and deliver a memorandum of
lease which Landlord shall, at its sole expense, cause to be recorded as a lien against the
Premises and the Transit Parcel.
32. BROKER'S REPRESENTATION.
Landlord and Tcnanteach represent that such Party -has Bot dealt with any broker or
brokers in connection with the ncgoiiation, execution and delivery of this Lease, other -than
,~'ho is a 'licensed real estate broker, and is
33
representing Tenant. Tenant is solely responsible for any fees and/or commissions owing to its
real estate broker. Landlord and Tenant shall, and do hereby, indemnify and save the other
harmless from and against any losses, damages, penalties, claims or demands of whatsoever
nature arising from a breach of its foregoing representation including, without limitation,
reasonable attorneys' fees and expenses. The representations and indemnifications set forth in
this Section shall survive the cancellation or termination of this Lease.
33. CAPTIONS AND DEFINITIONS.
Marginal captions of this Lease are solely for convenience of reference and shall not in
any way limit or amplify the terms and provisions thereof. The necessary grammatical changes
which shall be required to make the provision of this Lease apply (a) in the plural sense ifthere
shall be more than one Landlord and (b) to any landlord, which shall be either a corporation, an
association, a partnership or an individual, male or female, shall in all instances be assumed as
though in each case fully expressed.
34. SURVIVAL.
Unless otherwise provided, upon the termination of this Lease under any of the
provisions hereof, the parties hereto shall be relieved of any further liability hereunder except as
to acts, omissions or defaults occurring prior to such termination.
35. FORCE MAJEURE.
Landlord and Tenant shall be excused for the period of any delay in performance of any
obligations hereunder by reason of the wrongful or negligent acts or omissions of the other party,
their agents, employees, or contractors, or by reason of labor disputes, civil disturbance, war,
war-like operations, invasions, rebellion, hostilities, military or usurped power, sabotage,
governmental regulations or controls, fires or other casualty, or acts of God out of such party's
control (referred to collectively herein as "Force Maieure"). Notwithstanding the foregoing: (a)
nothing contained in this Section shall excuse either party from paying in a timely fashion any
payments due under the terms of this Lease; and (b) no delay under this Section shall be
permitted in connection with delays caused by local governmental ordinances, codes or
regulations in effect on the effective date of this Lease or the implementation of same.
36. ATTORNEYS' FEES.
If either Landlord or Tenant shall institute any action or proceeding against the other
Party relating to this Lease, then the unsuccessful Party in such action or proceeding shall
reimburse the successful Party for its disbursements incurred in connection therewith and for its
reasonable attorneys' fees and costs as fixed by the court. In addition to the foregoing award of
attorneys' fees to the successful Party, the successful Party in any lawsuit on this Lease shall be
entitled to its attorneys' fees and costs incurred in any post-judgment proceedings to collect or
eriforce the judgment. This provision is separate and several and shall survive the merger 0 r this
Lease into any judgment on this Lease.
34
37. SATELLITE DISH.
Tenant has the right to install satellite dishes and/or other electronic transmitters
(collectively the "Antenna") on the roofs of Ten ant's Buildings in compliance with all applicable
local zoning ordinances and regulations, provided that such installation does not invalidate the
roof warranties. Tenant shall repair any damage caused by installation or removal of any such
equipment.
38. CONTINGENCIES.
Tenant's obligations under this Lease are contingent upon the satisfaction of the
following contingency within ninety (90) days after execution of this Lease:
(i) Approval. Tenant shall obtain from the City of Chanhassen, all required
permits and licenses including PUD amendments and approvals for the
construction of Tenant's Work and the operation of the Premises as
provided in this Lease.
In the event either or both of the conditions set forth in subparagraphs (a) and (b) above
are not satisfied within the ninety (90) day period, then either Party may terminate this Lease by
providing written notice to that effect to the other Party at any time after the expiration of the
period (but in no event may such termination notice be given until ten (10) days after notice to
the other party of (A) the failure of either or both of the contingencies set forth herein, and (B)
the party's right to terminate the Lease as provided herein), in which event this Lease shall be
deemed terminated and canceled ab initio, and all Parties shall be released and discharged from
all liabilities and obligations hereunder. If the conditions set forth in subparagraphs (i) and (ii)
above are satisfied prior to the effective date of any termination of this Lease under the
provisions of the preceding sentence, then such terminatioh will not be effective and this Lease
shall continue in full force and effect.
39. LANDLORD'S LIABILITY.
Notwithstanding anything to the contrary herein, Landlord shall not be required to pay on
behalf of itself and to any other party or parties any amount as indemnification to a party pr
parties, arising by operation of law or otherwise as a result of the relationships created, pursuant
to this Lease in excess of the limits of liability applicable to the party required to pay as
established in Minnesota Statutes Chapter 466, or in the event that Minnesota Statutes Chapter
466 does not apply, the maximum amount of insurance coverage available to the party required
to pay. The limits of liability for some or all of the parties may not be added together to increase
the maximum amount of liability for any party. The intent of this section is to limit Landlord's
obligation to indemnify another party or parties. In those instances in which the Landlord is
directly liable for damages as well as for indemnification to another party, the combined liability
of the Landlord will not exceed the limits of liability under Minnesota Statutes Chapter 466
applicable to -the Landlord or in the event that Minnesota Statutes Ghapter 466 does not apply,
the maximum amount of insurance covcrageavailabJe to the Landlord.
35
IN WITNESS WHEREOF, the parties hereto have executed this Lease as of the day
and year first above written.
SOUTHWEST METRO TRANSIT COMMISSION,
a Minnesota Joint Powers Board
By:
Len Simich
Its: Executive Director
I
APOGEE INVESTMENTS CHANHASSEN, L.L.C.
By:
Its: Chief Manager
36
CONCEPT C
SOUTHWEST METRO TRANSIT STATION
DEVELOPMENT IN CHANHASSEN
BENSHOCF /I. ASSOCIATES. INC.
2'2iC6
N
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E-4
Exhibit E
Construction Staging, Utilities Access, Retail Signage Areas
E-6
.
Exhibit F
Permitted Exceptions
1. Real estate taxes and installments of special assessments not yet due and payable.
2. Public utility and drainage easements.
E-7
Exhibit G
Standard Sign Criteria
DESIGN INTENT
Signage at the Premises is intended to control the size of signs in order to keep them in scale with
adjacent buildings and surrounding development. Signage is viewed from short distances whether you
are a pedestrian or in a vehicle across the street or perpendicular to the sidewalk. Building signage should
not overpower architectural character, but serve to identify tenants/occupants.
The most important guiding rule for signage desire is to encourage creative graphics. The message
should be easily read and direct. In addition, there are some other basic rules to achieve a successful sign
for a business.
Siltn Tvpes and Parameters
The following types and amounts of signs will be permitted:
· Tenant/occupant sign area shall be on the building faces above the entrances and as part of the
building design.
· The maximum height for letters in the sign band area shall not exceed 38" in height; 48" for logos or
first letters in height.
· The sign areas shall not exceed ten percent (10%) of the area of the storefront.
· Signage shall be illuminated individual letters mounted on an opaque background. The use of a
colored or frosted Plexiglas face is required.
· Reversed halo lighting requires approval by Landlord.
· Signs shall not extend more than 8" beyond the face of the surface to which the sign is mounted.
· All signs must be illuminated and shall derive light from a concealed source. No exposed lamps,
globes, tubes, etc. will be permitted.
· Logos will be allowed on tenant/occupant storefronts only when reviewed and approved by Landlord.
· Double stacked lettering shall be allowed on an individual basis only and are subject to Landlord
approval. Double stacked letters shall be a maximum 24" high individual letters and shall
comfortably fit within the bulkhead as determined by Landlord.
· Tag lines shall be allowed on an individual basis only and are subject to Landlord approval. Any
allowable tag lines shall be individual illuminated letters (no box signs) and shall not exceed 10" in
height. The width of the tag line shall not exceed the width established for the primary signagc.
E-8
. Lettering on all store signs shall be limited to business or trade name of the premises as approved by
Landlord. No sign manufacturer's name, union labels, or other lettering shall be visible. Logo signs
will be reviewed on an individual basis, but in general logo signs will not be allowed.
. No exterior sign or sign panel will be permitted to extend above any roofline.
. Any sign, notice or other graphic or video display, particularly self-illuminated signs, located within
any store and which is easily visible from the Shopping Center Tracts must be approved by Landlord.
. Manufacturers' labels, underwriters' labels, clips, brackets, or any other form of extraneous
advertising attachment or lighting devices shall be fully concealed from public view.
. One tenant/occupant identification sign per fac;:ade is allowed. End cap tenants/occupants are allowed
a maximum of three (3) signs.
· No exposed raceways, crossovers or conduits will be permitted.
· All signage returns shall either match face color of sign or blend with adjacent building color.
· Signage is allowed only within boundaries oftenant's/occupant's space.
· All cabinets, conductors, transformers and other equipment shall be concealed from public areas;
visible fasteners will not be permitted.
· All metal letters shall be fabricated using full-welded construction, with all welds ground smooth so
as not to be visible.
· Acrycap or trim cap retainers used at the perimeter of sign letter faces shall match in color and finish
the face or the sides of the sign.
· Threaded rods or anchor bolts shall be used to mount sign letters, which are spaced out from the
background panel. Angle clips attached to letter sides will not be permitted. All mounting
attachments shall be sleeved and painted.
· Except as provided herein, no advertising placards, banners, pennants, names, insignia, trademarks, or
other descriptive materials shall be affixed or maintained upon the glass panes and supports of the
storefront windows and doors, within 4' of the storefront, without prior approval by Landlord.
· Flush mounted signs or projecting signs shall be located above the storefront display windows or
transoms and below any second story windowsills.
· Signage shall be within designated sign area and shall occupy no more than 65% of the area.
· Display areas shall not be obstructed by window signage. Small stenciled letters, addresses or logos
can be appropriate signage in windows, but the painting oflarge areas of glass is prohibited.
· Awnings can displaysignage.with1ettering 6-R" in height, logos not exceeding 12", subject [0 rev.iew
and approval by Landlord.
E-9
. Colors and lighting should be encouraged. Individuality of styles and identity of tenant/occupant
should be encouraged.
. Internally illuminated panel signs (box signs) are not allowed. Painted signs can be illuminated
through the use of simple exterior lighting. Individually mounted letters are encouraged.
. Exposed neon is not allowed.
. Any Plexiglas sign faces shall not be clear.
. Sign illumination shall be internal and self-contained.
· All electric signs and installation methods must meet UL standards and contain a UL label.
. At no time will hand-lettered, non-professional signs, or newspaper advertisements be displayed on
storefronts.
. Decals or other signing indicating products lines or credit card acceptability shall not be permitted on
the storefront glazing other than stores' operating hours.
. All illuminated signs must be turned on during the Shopping Center Tracts' normal operating hours.
The use of time clocks for sign and show window lighting is required.
. Lighting of signs shall be at hours as required by Landlord.
· All tenants/occupants will be allowed one 4' x 8' temporary construction sign prior to opening for
business; location to be coordinated with Landlord.
· Minimum height of all signage shall not be less than 80% of the maximum allowable letter height
without prior written approval of Landlord.
· All signage is subject to the approval of Landlord and applicable governmental authorities.
Si!!ns not permitted
The following types of signs shall not be permitted:
· Signs such as die cut vinyl, gold or silver leaf, or paint.
. Boxed pillow or cabinet type.
· Formed plastic or injection molded plastic signs.
· Banners or pennants.
· Signature signage (window sign or sign plate indicating name of shop or good sold) in addition to
primary signagc.
E-lO
.
. Cloth, paper, cardboard and similar stickers or decals around or on surfaces on the tenant/occupant
storefront without prior written approval of Landlord.
. Animated, moving, rotating or flashing.
. Noise making.
. Additional signage of any kind within 4' of storefront windows.
Additional Sil!na2e
Service doors to tenant/occupant spaces throughout the Shopping Center Tracts shall be standard 4",
identification only (name and address number) and shall be installed by the tenant/occupant. The
tenant/occupant shall not apply any signage or other wording to service doors.
· All signage must be shown to scale on the approved storefront elevation.
. All additional signage shall be submitted to Landlord for approval.
Address Si2ns
· Address signs shall not exceed 4 square feet. This area is exclusive of the wall sign area allowed.
One address sign per building or tenant/occupant bay shall be provided.
· Number of address signs is not included in the wall sign calculation.
FREEST ANDING SIGNS
· The business/monument signs must be located in landscaped areas.
. Freestanding signs not to exceed 8'_8" in height.
· The location of signs shall not interfere with traffic visibility or movement of traffic. No sign or sign
structure shall be closer to any lot line than a distance equal to one-half the minimum required yard
setback.
· One area identification sign is allowed at the corner intersection of
Tenant/occupant signage is allowed within designated sign
areas. The sign shall be generally as depicted on Exhibit E-I attached hereto and made a part hereof,
with such modifications as Landlord and SMTC mutually approve.
· A single Outparcel monument sign is allowed for the Premises. The monument sign shall be
constructed generally as depicted on Exhibit E-l. The actual monument signage shall be individually
illuminated letters on an opaque background. All monument signs shall have required landscaping at
base, subject to Landlord approval.
E-II
..
EXIDBIT G-l
Depiction of Area Identification Sign and Outparcel Sign
[To be attached]
...
..
EXIDBIT H
RENT SCHEDULE
Rent Period
Rate Per Square Foot
Annual Rent
P:\lIomeISMTC-U622\Chanhasscn - Site DevclopmentlCommerciaJ\GROUND LL\SE-I-202 I I06.doc
Monthly Rent