North Dakota-Fargo-51 Broadway Lease - First Bank System Inc. and Shields Enterprises Inc.
FIRST BANK SYSTEM, INC.
LEASE AGREEMENT
DATA SHEET
DATE: __________________________
BUILDING NAME AND ADDRESS: Dakota Center, 51 Broadway
Fargo, North Dakota
LANDLORD NAME AND ADDRESS: First Bank System, Inc.
601 2nd Avenue South,
Minneapolis, Minnesota, 55402
(Attention: FBS Properties Management)
TENANT NAME AND ADDRESS: Shields Enterprises, Inc.,
212 East Ohio Street
Chicago, Illinois 60611-3203
USE (SECTION 2): Business offices
LEASE TERM (SECTION 3): June 1, 1994 through May 31,1999
RENTABLE SQUARE FEET OF 13,545 (12,094 usable square feet)
DEMISED PREMISES (SECTION 1):
RENTABLE SQUARE FEET OF 81,672
BUILDING (SECTION 1):
MONTHLY BASE RENT (SECTION 4): Months 1-8 - $7,901.41
Remaining months - $6,777.50
ADDITIONAL RENT (SECTIONS 5 and 6): Estimated payments for 1994 of $4.60
per sq. ft. annualized for Operating
Expenses and $362.80 per month for
special utility and janitorial
services
TENANT'S PROPORTIONATE SHARE 16.58%
(SECTION 5):
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LEASE AGREEMENT
THIS LEASE AGREEMENT, made as of June 1, 1994, between FIRST BANK SYSTEM,
INC., a Delaware corporation (hereinafter called "Landlord"), and SHIELDS
ENTERPRISES, INC., an Illinois corporation (hereinafter called "Tenant");
WITNESSETH, THAT:
1. Demised Premises: Landlord, subject to the terms and conditions
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hereof, hereby leases to Tenant the premises (hereinafter referred to as the
"Demised Premises") consisting of 13,545 rentable square feet (12,094 net usable
square feet) of office space on the second floor of the building containing
81,672 rentable square feet and known as Dakota Center in Fargo, North Dakota
(hereinafter referred to as the "Building"). A floor plan is attached as
Exhibit A. The building is located on real property legally described on
attached Exhibit A-1 (the "Property"). All measurements of usable and rentable
area contemplated or required by this Lease with respect to the Demised Premises
or the Building shall be made on the basis of BOMA space measuring standards.
Tenant shall be provided, without additional rental, five parking
spaces, in common with Landlord and other tenants in the building and their
customers and invitees, in the parking lot located on a portion of the Property
situated east of the Building.
2. Use: The Demised Premises shall be used by Tenant for the purpose
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of business offices, and for no other purpose. Tenant shall also be entitled to
the nonexclusive use of all hallways, access ways, parking facilities and other
common areas and facilities ("Common Areas") appurtenant to the Building.
3. Term: Tenant takes the Demised Premises from Landlord, upon the
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terms and conditions herein contained, to have and to hold the same for the term
(the "Lease Term") commencing on the 1st of June, 1994 (the "Commencement
Date"), and expiring on the 31st day of May, 1999 (the "Expiration Date").
4. Base Rent: Tenant shall pay to Landlord total "Base Rent" for the
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Lease Term in the amount of $7,901.41 per month during the first eight months of
the Lease Term and in the amount of $6,777.50 per month for the remaining months
of the Lease Term, on the first day of each month, in advance, at the offices of
Coldwell Banker First Realty-Encore, 51 Broadway in Fargo, North Dakota or at
such other place as may from time to time be designated by Landlord.
5. Additional Rent: Tenant shall pay, as "Additional Rent" to
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Landord, together with each monthly installment of base rent, the amount of any
gross receipts tax, sales tax, or similar tax (but excluding therefrom any
income tax) payable, or which will be payable, by Landlord, by reason of the
receipt of the monthly base rent and adjustments thereto.
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Tenant shall also pay, as additional rent, Tenant's "Proportionate
Share" of the Operating Expenses (as hereinafter defined) for the Building for
each calendar year (or portion thereof) during the Lease Term, or any extension
or renewal thereof for purposes of determining Tenant's Proportionate Share of
Operating Expenses, Tenant's Proportionate Share is estimated to equal
approximately 16.58% of the total and will be computed as a percentage which the
rentable square foot area of the Demised Premises bears to the rentable square
foot area of the Building. The term "Operating Expenses" as used herein shall
mean all real estate taxes, insurance premiums, and other expenses and costs
which Landlord shall pay or become obligated to pay because of or in connection
with the ownership of the Building (excluding, however, depredation and interest
or payments of principal on any mortgage or other encumbrance). Costs of capital
improvements to the Building shall not be included in Operating Expenses, except
as follows: (a) costs of capital improvements made to the Building or equipment
installed in the Building subsequent to the Commencement Date which are required
under any governmental laws, regulations or ordinances shall be included in
Operating Expenses, but only as amortized on a straight line basis over the
useful life of such equipment or improvements, using an interest rate equal to
the Reference Rate (or a successor rate) from time to time established by First
Bank National Association (Minneapolis) or a similar rate of a similar
institution if First Bank National Association (Minneapolis) no longer exists or
no longer establishes a Reference Rate (or successor rate) (such rate being
referred to below as the "Interest Rate"); and (b) costs of capital improvements
not covered under the immediately preceding subsection (a) that have the effect
of reducing Operating Expenses shall be included in Operating Expenses, but only
insofar as the Operating Expenses are actually reduced (the intention of the
parties being that there shall be no net increase in Operating Expenses as a
result of such a capital improvement).
Operating Expenses shall also include reasonable costs and attorneys' or
consultant's fees associated with any administrative or legal proceeding
commenced by Landlord for the purpose of attempting to obtain an abatement of
real estate taxes and/or special assessments with respect to the Building.
Landlord shall, in its sole discretion, determine on an annual basis whether or
not to commence such abatement proceedings, and Tenant may not independently
commence such proceedings on behalf of itself and/or Landlord.
All Operating Expenses shall be determined in accordance with generally
accepted accounting principles which shall be consistently applied (with
appropriate accruals).
The payment of Additional Rent set forth herein shall be in addition to
the Base Rent payment required by paragraph 4 of this Lease. Should this Lease
commence or terminate at any time other than the first day of the calendar year,
the Operating Expenses shall be prorated such that Tenant shall pay only its
proportionate share of the Operating Expenses for the calendar days during such
calendar year for which Tenant is obligated to pay Base Rent with respect to the
Demised Premises.
Prior to commencement of the Lease Term, and prior to the commencement
of each calendar year thereafter commencing during the Lease Term, or any
renewal or extension thereof, Landlord may estimate for such calendar year the
total amount of Operating Expenses and Tenant's Proportionate Share of the same
for such calendar year, and the computation of the annual and
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monthly Additional Rent payable during such calendar year as a result of
increase or decrease in Tenant's share of Operating Expenses. Said estimate will
be in writing and will be delivered or mailed to Tenant at the Demised Premises.
Tenant acknowledges that Tenant's Proportionate Share of estimated
operating expenses (other than real estate taxes and special assessments) during
calendar year 1994 shall be $3.00 per rentable square foot on an annualized
basis ($3,386.25 per month for the initial Demised Premises). Tenant also
acknowledges that Tenant's proportionate share of estimated real estate taxes
and special assessments during calendar year 1994 shall be $1.60 per square foot
of rentable area, on an annualized basis ($1,806.00 per month for the initial
Demised Premises).
The amount of Tenant's Proportionate Share of Operating Expenses for
such calendar year, so estimated, shall be payable in equal monthly
installments, in advance, on the first day of each month of such calendar year,
together each installment of monthly Base Rent.
As soon as practicable after the expiration of each calendar year,
Landlord shall determine and certify to Tenant the actual amount of the
Operating Expenses payable in such calendar year and Tenant's Proportionate
Share thereof. If Tenant has underpaid its Proportionate Share of Operating
Expenses for such calendar year, then (subject to Tenant's examination rights as
set forth below) Tenant shall, within thirty (30) days after receiving
Landlord's certification, pay such deficiency to Landlord. In the event of any
overpayment by Tenant, such overpayment shall be refunded to Tenant in the form
of a credit against future monthly Operating Expense payments or, if at the end
of the Lease Term, by a refund.
Landlord agrees to keep accurate books and records reflecting the
Operating Expenses of the Building. For thirty (30) days after receiving
Landlord's certification, Tenant's authorized agent or representative (which
shall be an independent certified public accountant selected by Tenant with
Landlord's approval), shall have the right, so long as Tenant is not then in
default hereunder, to examine such books and records at Landlord's office during
normal business hours for the purpose of verifying the information in such
certification. Unless Tenant asserts in good faith the existence of a specific
error or errors therein, in writing, within thirty (30) days after such receipt,
the certification shall be deemed to be correct for all purposes.
In the event Tenant's examination reveals that the actual Operating
Expenses are less than those set forth in Landlord's certification, Tenant shall
receive a credit equal to the amount of its Proportionate Share of the
difference against the installment or installments of Additional Rent next
coming due, or, if the Lease Term has expired, a cash payment equal to its
Proportionate Share of such difference to be paid within 30 days of Tenant's
determination. In the event Tenant's examination reveals that the actual
Operating Expenses are more than those set forth in Landlord's certification,
Tenant shall pay Landlord its Proportionate Share of the difference within 30
days of Tenant's determination. All costs and expenses associated with any such
examination shall be paid by Tenant, except that if the amount of Operating
Expenses set forth in Landlord's certification is more than five percent (5%)
greater than the true and correct Operating Expenses as determined by Tenant's
examination, Landlord shall pay the reasonable costs and expenses associated
with such
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examination. Tenant shall keep such books and records and the information
contained therein confidential and shall use the same only for determination and
establishment of the correctness or incorrectness of Landlord's certification of
Operating Expenses.
6. Tenant's Expense Credit and Special Charge: As a special credit to
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the Tenant, Landlord will make no charge for rental for Operating Expenses,
including real estate taxes, to the Tenant for months one through eight of the
first year of the Lease Term.
Tenant intends to conduct office operations on a 24 hour per day 7 days
per week basis on the Demised Premises. To compensate the Landlord for
additional janitorial services and utility services required, Tenant shall pay
additional and separate rental in the initial amount of $.10 per rentable square
foot per year for electrical and utility services, and $.26 per rentable square
foot per year for additional janitorial services, for an initial additional
monthly rental of $362.80 per month for the initial Demised Premises, payable in
advance. This rental shall be subject to annual adjustments based on Landlord's
annual good faith determination of actual additional expense incurred by
Landlord in connection with such additional services.
Tenant may submit a request to the appropriate governmental authorities
for a real estate tax abatement as an incentive for its occupancy of the Demised
Premises (as opposed to a tax abatement resulting from a protest of the assessed
value of the Building). Landlord will cooperate with any such request. In the
event that a real estate tax abatement is granted to Landlord as a result of
Tenant's request, the benefits of any such abatement shall be reflected in the
Tenant's additional rental obligation as set forth under this Lease if, as and
when such benefits are received by Landlord.
7. Landlord and Tenant Improvements: Landlord has caused to be
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constructed the improvements to the Demised Premises described on the Work
Letter attached hereto as Exhibit B (the "Initial Tenant Improvements"). Tenant
acknowledges that the Initial Tenant Improvements have been completed in
accordance with the plans and specifications approved by Tenant and that the
Demised Premises are in good and satisfactory condition and are in compliance
with the terms of this Lease, except for such minor details of construction,
decoration and mechanical adjustment, if any, as are disclosed to Landlord in
writing within thirty (30) days after Tenant takes possession of the Demised
Premises.
Tenant shall not make any improvements, alterations (including, without
limitation, the penetration of walls, ceilings or floors), additions or
installations (including, without limitation, wiring for communications and data
processing systems) in or to the Demised Premises ("Improvements") without
obtaining Landlord's prior written consent, which consent shall not be
unreasonably withheld. Tenant shall not be allowed to make any alterations,
modifications, improvements, additions, or installations if such action results
or would result in a labor dispute or otherwise would materially interfere with
Landlord's operation of the Building. Along with any request for Landlord's
consent and before commencement of any Improvements or delivery of any materials
to be used in the Improvements to the Demised Premises or into the Building,
Tenant shall furnish Landlord with plans and specifications, names and addresses
of contractors, copies of contracts, necessary permits and licenses, and an
indemnification in such form and amount as may be reasonably satisfactory to
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Landlord or a performance bond executed by a commercial surety reasonably
satisfactory to Landlord, in an amount equal to the estimated cost of the
Improvements. Landlord's approval of contractor's plans, specifications and
working drawings for said Improvements shall create no responsibility or
liability on the part of Landlord for their completeness, design sufficiency, or
compliance with all laws, rules and regulations of governmental agencies or
authorities. Tenant agrees to defend and hold Landlord forever harmless from any
and all claims and liabilities of any kind and description which may arise out
of or be connected in any way with said Improvements. All Improvements hereunder
shall be done only by contractors or subcontractors approved by Landlord and at
such time and in such manner as Landlord may from time to time reasonably
designate. Landlord reserves the right to require Tenant to use Landlord's
designated contractors, subcontractors, or engineers to perform Improvements
which affect structural or mechanical systems of the Building. All work done by
Tenant, its agents, employees, or contractors shall be done in such a manner as
to avoid labor disputes. Tenant shall pay the cost of all such Improvements, and
also the cost of painting, restoring, or repairing the Demised Premises and the
Building occasioned by such Improvements. Upon completion of any Improvements,
Tenant shall, unless waived by Landlord, furnish Landlord with "as built"
architectural drawings of the Demised Premises, sworn construction cost
statements, and full and final waivers of liens and receipted bills covering all
labor and materials expended and used. The Improvements shall comply with all
insurance requirements and all laws, ordinances, rules and regulations of all
governmental authorities and shall be constructed in a good and workmanlike
manner. Tenant shall permit Landlord to inspect construction operations in
connection with the Improvements.
Improvements made by Tenant during the Lease Term shall, unless Landlord
otherwise agrees, be removed by Tenant at its expense at or prior to the
Expiration Date or the effective date of earlier termination of this Lease, and
Tenant shall repair, at Tenant's sole expense, any damage caused to the Demised
Premises by such removal. Landlord agrees that it shall notify Tenant in
writing, at such time as Landlord consents to any Improvement, as to whether or
not the Improvement must be so removed by Tenant at or prior to the Expiration
Date or the effective date of earlier termination of this Lease. Tenant shall,
at or prior to such termination date or Expiration Date remove all computer and
communication cabling and equipment installed by or at the direction of Tenant.
Tenant shall repair or restore any damage caused by the installation and removal
of such cabling, or any Improvement, which Tenant is required to remove
hereunder. Property not specified for removal shall upon termination or
expiration of the Lease become the property of Landlord. Except for computer or
communication cabling installed by or at the direction of Tenant, the
improvements, additions, alterations and installations comprising the Initial
Tenant Improvements, as defined herein, and made or installed pursuant to plans
and specifications approved by Landlord, shall not be subject to the removal
requirements set forth herein. All moveable trade fixtures, equipment,
furnishings, and other personal property of Tenant located in the Demised
Premises shall remain the property of Tenant and shall be removed by Tenant upon
termination or expiration of this Lease, and Tenant shall repair, at Tenant's
sole expense, any damage caused to the Demised Premises by such removal.
Tenant shall not permit any mechanic's or other liens to be filed
against the Demised Premises or the Building for any labor or materials
furnished to or in connection with any Improvements performed or claimed to have
been performed in or about the Demised Premises at the instance and
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request of Tenant, and shall immediately discharge and remove any such lien,
provided, the Tenant shall have the right to contest such lien, in good faith,
on the condition that Tenant provides Landlord, and if requested by Landlord,
Landlord's mortgage lender, with a bond, cash escrow deposit or other security
in a form and amount reasonably acceptable to Landlord and Landlord's mortgage
Lender. In the event Tenant fails to remove or contest any such lien, Landlord
may remove such lien and Tenant shall immediately pay Landlord, as Additional
Rent, upon demand, all costs and expenses, including attorneys' fees, which
Landlord incurs in connection with the removal of such lien. Landlord shall have
the right to post a notice in the Demised Premises disclaiming any liability for
payment for any Improvements of Tenant or other construction or improvements
performed by persons or entities other than Landlord or its contractors, and/or
for any liens arising in connection therewith, and Tenant agrees not to disturb
any such notice.
8. Services: Landlord agrees that it shall:
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A. Furnish heat and air-conditioning to the Demised Premises, on a
24 hour per day basis, Saturdays and Sundays included, subject
to any applicable energy laws, codes and regulations, to
maintain conditions inside the Demised Premises as follows:
(1) not more than 75 degrees Fahrenheit and 50% relative
humidity when the outside temperature does not exceed 92
degrees Fahrenheit dry bulb and 75 degrees Fahrenheit wet
bulb;.
(2) not less than a minimum temperature of 72 degrees Fahrenheit
when the outside temperature is not less than minus 16
degrees Fahrenheit; and
(3) maximum inside relative humidity will, in any event, be
limited to that which will not cause condensation on the
windows when outside temperatures are between minus 16
degrees and 65 degrees Fahrenheit dry bulb.
Landlord shall not be responsible for maintaining such conditions
if heat generating machines or equipment other than those
described on attached Exhibit E are used in the Demised Premises
which affect the temperature otherwise maintained by the air-
conditioning system, unless Tenant agrees to pay, as Additional
Rent with the monthly rental payments due under this Lease as
billed by Landlord, for the installation, operation and
maintenance costs of supplementary air conditioning equipment in
the Demised Premises, and gives Landlord sufficient time to
complete the installation of such equipment. If heat generating
machines or equipment other than those described on attached
Exhibit E are used in the Demised Premises, Landlord reserves the
right to install such supplementary air conditioning equipment in
the Demised Premises,
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and the installation, operation and maintenance costs thereof
shall be paid by Tenant to Landlord as Additional Rent with the
monthly rental payments due under this Lease as billed by
Landlord.
B. Provide maintenance and janitorial services to the Demised
Premises, excluding any special treatment of walls, floors, or
ceilings made by or at the request of Tenant and excluding
repairs to any fixtures or other improvements installed or made
by or at the request of Tenant, in accordance with the schedule
set forth on attached Exhibit F.
C. Provide water facilities and City water for drinking, lavatory
and toilet purposes drawn through fixtures installed by Landlord.
D. Provide electrical facilities and electric current as available
and provided by the public utility serving the City of Fargo.
E. Provide Tenant, upon Tenant paying the rent reserved hereunder
and observing and performing all agreements, terms and conditions
to be observed and performed hereunder by Tenant, quiet
possession of the Demised Premises for the entire term hereof,
subject to all the provisions of this Lease.
F. Comply with applicable zoning, occupancy and health regulations
and standards of the City of Fargo and other governmental
agencies.
G. Provide security to the Building in accordance with attached
Exhibit G.
Landlord agrees to acknowledge and commence a response, within 3 hours
(unless Landlord is delayed in doing so by any event of Force Majeure), to any
emergency request from Tenant made to Landlord's building manager with regard to
building services.
It is understood that Landlord's obligation to provide the foregoing
services and facilities shall not be construed so as to preclude Landlord from
including the cost of any such services as Operating Expenses under paragraph 5
hereof. It is further understood that Landlord does not warrant that any of the
services referred to above will be free from interruption to the extent that
such interruption is caused by an event of Force Majeure. No interruption of
services caused by an event of Force Majeure shall be deemed an eviction or
disturbance of Tenant's use and possession of the Demised Premises or any part
thereof, nor shall it render Landlord liable to Tenant for damages by abatement
of rent or otherwise or relieve Tenant from performance of Tenant's obligations
under this Lease.
9. Covenants of Tenant: Tenant agrees that it shall:
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A. Observe such reasonable regulations as from time to time may be
put in effect by Landlord for the general safety, comfort and
convenience of occupants and tenants of said Building.
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B. Use the Demised Premises in a manner which complies with all
federal, state, and local laws, ordinances and regulations.
C. Give Landlord access to the Demised Premises at all reasonable
times, without charge or diminution of rent, to enable Landlord
to examine the same and to make such repairs, additions, and
alterations as Landlord may deem advisable.
D. Keep the Demised Premises clean, in good order and condition,
and replace all glass broken by Tenant with glass of the same
quality as that broken, save only glass broken by fire and
extended coverage risks, and commit no waste in the Demised
Premises.
E. Pay for electric lamps, starters and ballasts used in the
Demised Premises.
F. Upon the termination of this Lease in any manner whatsoever,
remove Tenant's goods and effects and those of any other person
claiming under Tenant, and quit and deliver up the Demised
Premises to Landlord peaceably and quietly in as good order and
condition as the same are now in or hereafter may be put in by
Landlord or Tenant, reasonable use and wear thereof and repairs
which are Landlord's obligation excepted. Goods and effects not
removed by Tenant at the termination of this Lease, however
terminated, shall be considered abandoned and Landlord may
dispose of the same as it deems expedient.
G. Not assign this Lease or sublet all or any part of the Demised
Premises without first obtaining Landlord's written consent
thereto, which consent may be withheld in Landlord's sole
discretion; provided, however, that Tenant may assign this Lease
or sublet the Demised Premises, without the consent of Landlord
(but only after having given 10 days' prior written notice of
such assignment or sublease to Landlord describing the parties
to and material terms of the assignment or sublease), to any
party that controls, is controlled by or is under common control
with Tenant or to any party that acquires substantially all of
the assets of Tenant, and in any such case Tenant shall supply
Landlord with a copy of the executed assignment or sublease
within 10 days after it is executed and delivered. In no event
shall Tenant assign this Lease or sublet the Demised Premises to
any present or past Tenant of the Building at the time of the
proposed assignment or subletting. In the event Landlord
consents to any such assignment or subletting, Tenant and the
proposed assignee or sublessee shall enter into a written
agreement with Landlord providing that: (i) Tenant shall pay to
Landlord, as Additional Rent hereunder, all sums received from
the assignee or subtenant in excess of the amounts owed to
Landlord by Tenant under this Lease, which amounts shall be paid
to Landlord as and when received by Tenant; and (ii) such
assignee or sublessee shall assume in writing the performance of
the covenants and obligations of Tenant hereunder. No assignment
or subletting shall not be deemed to release Tenant
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from the payment and performance of any of its obligations under
this Lease, whether or not Landlord's consent is required and/or
given, unless Landlord specifically and expressly so states in
writing.
H. Not place signs on the Demised Premises or elsewhere in the
Building or Common Areas except for the sign described on
attached Exhibit C, which sign shall be installed by Tenant, at
Tenant's sole expense, and shall be removed (and any damage
caused by such removal repaired) by Tenant, at Tenant's sole
expense, prior to the expiration or termination of this Lease. A
Tenant directory will be provided on the main floor of the
building and in the court area. Landlord's acceptance of any name
for listing on the Building's directory shall not be deemed
consent to any sublease or assignment, or occupancy of the
Demised Premises by any party other than Tenant.
I. Not overload, damage or deface the Demised Premises or do any act
which may make void or voidable any insurance on the Demised
Premises or the Building, or which may render an increased or
extra premium payable for insurance.
J. Not create or permit to be created or remain, and will discharge
any lien, encumbrance or charge (other than a lien, encumbrance
or charge created by Landlord) upon the Building or Demised
Premises or any part thereof. Tenant agrees to indemnify and hold
harmless Landlord from and against any and all liabilities,
costs, and expenses (including attorneys' fees) arising from the
creation or removal of any lien or encumbrance proscribed herein.
K. Tenant agrees that the use of the Common Areas, including but not
limited to all halls, passageways, toilet rooms, parking areas
and landscaped areas in the Building, by the Tenant or Tenant's
servants, employees, guests or invitees, shall be subject to the
applicable rules and regulations as may from time to time be made
by Landlord for the safety, comfort and convenience of the
owners, occupants, tenants and business invitees of the Building.
Use of the roof of the Building is reserved to the Landlord.
Tenant agrees that no awnings or shades shall be used upon the
Demised Premises except such as may be approved by Landlord.
Tenant's obligations under this paragraph 9 to do or not to do a
specified act shall extend to and include Tenant's obligation to see to it that
Tenant's employees and agents shall do or shall not do such acts, as the case
may be.
10. Rights Reserved by Landlord: Landlord reserves the following rights
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exercisable without notice and without liability to Tenant and without effecting
an eviction, constructive or actual, or disturbance of Tenant's use or
possession, or giving rise to any claim for set-off or abatement of rent:
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A. To control, install, affix and maintain any and all signs on the
Building or the Common Areas, except those signs within the
Demised Premises not visible from outside the Demised Premises.
B. To reasonably designate, limit, restrict and control any service
in or to the Building, including but not limited to the
designation of sources from which Tenant may obtain sign painting
and lettering. Any restriction, designation, limitation or
control imposed by reason of this subparagraph shall be imposed
uniformly on Tenant and other tenants occupying space in the
Building.
C. To retain at all times and to use in appropriate instances keys
to all doors within and into the Demised Premises. No locks
shall be changed without the prior written consent of Landlord.
This provision shall not apply to Tenant's safes, or other areas
maintained by Tenant for the safety and security of monies,
securities, negotiable instruments or like items.
D. To make repairs, alterations, additions, or improvements, whether
structural or otherwise, in and about the Building, or any part
thereof, and for such purposes to enter upon the Demised
Premises, and during the continuation of any of said work, to
temporarily close doors, entryways, public spaces, and corridors
in the. Building and to interrupt or temporarily suspend
services and facilities, provided, that Landlord shall not
permanently alter the Common Areas of the Building in a manner
which materially and detrimentally affects Tenant's use of the
Demised Premises.
E. To restrict or prohibit vending or dispensing machines of any
kind in or about the Demised Premises, except for Tenant's break
room.
F. To approve the weight, size and location of safes and other heavy
equipment and articles in and about the Demised Premises and the
Building and to require all such items to be moved into and out
of the Building and the Demised Premises only at such times and
in such manner as Landlord shall direct in writing.
In exercising its rights under this Section, Landlord shall, when
feasible, provide Tenant with reasonable prior notice of Landlord's activities,
and shall make a reasonable effort to minimize the resulting interference with
the conduct of Tenant's business, including conducting such activities during
nonbusiness hours when it is possible to do so without a material increase in
expense.
11. Casualty Loss: In case of damage to the Demised Premises or the
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Building by fire or other casualty, Tenant shall give immediate notice to
Landlord, who shall thereupon cause the damage to be repaired with reasonable
speed, at the expense of the Landlord, subject to delays which may arise by
reason of adjustment of loss under insurance policies and to delays beyond the
reasonable control of Landlord, and to the extent that the Demised Premises are
rendered
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untenantable, the rent shall proportionately abate, except in the event such
damage resulted from or was contributed to by the act, fault, or neglect of
Tenant, Tenant's employees or agents, in which event there shall be no abatement
of rent. In the event the damage shall be so extensive that the Landlord shall
decide not to repair or rebuild, this Lease shall, at the option of Landlord, be
terminated as of the date of such damage by written notice from the Landlord to
the Tenant and the rent shall be adjusted to the date of such damage and Tenant
shall thereupon promptly vacate the Demised Premises. Landlord will, within 30
days after the date the damage occurred, notify Tenant of the date by which
Landlord reasonably estimates the repairs will be completed, and if such date is
more than 90 days after the date such damage occurred, Tenant will have the
right to terminate this Lease by written notice given to Landlord within 10 days
after such Landlord notice is given to Tenant.
12. Insurance:
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A. Tenant's Obligations
1. Property Insurance. At all times during the entire Lease
Term, Tenant shall maintain at its own expense a policy of
"all-risk" insurance covering improvements, betterments,
fixtures and personal property owned or installed ' in the
Demised Premises at full replacement cost thereof.
2. Liability Insurance. At all times during the entire Lease
Term, Tenant shall maintain at its own expense a policy of
commercial general liability insurance, including
contractual liability covering its obligations under this
Lease, with a minimum coverage of $1,000,000.00 per
occurrence and not less than $3,000,000 annual aggregate for
this location. In addition to Tenant, the policy shall also
name Landlord, its agents, and assigns and any other person
designated by Landlord as additional insureds.
3. Workers' Compensation. In addition to the policies referred
to above, Tenant shall maintain at all times during the term
of this Lease worker's compensation insurance coverage to
the full extent required by applicable law and as may be
adequate to fully protect Landlord against claims made by
Tenant's employees, agents or contractors.
B. Landlord's Obligations:
1. Property Insurance. At all times during the term of this
Lease, Landlord shall maintain insurance providing coverage
for "all risks" of loss to the Building for not less than
80% of the full replacement cost thereof.
-11-
<PAGE>
2. Liability Insurance. At all times during the term of this
Lease, Landlord shall maintain commercial general liability
insurance providing coverage for the common areas and ways
on the Building and the land on which the Building is
located.
All policies of insurance purchased by Tenant in compliance with the
above provisions shall be purchased from an insurance company licensed to do
business in the state in which the Building is located with an A. M. Best rating
of not less than AX and shall be placed with such companies and upon such forms
as Landlord shall approve.
At least 10 days before the commencement of the Lease Term and annually
at each policy renewal thereafter, Tenant shall provide the Landlord with a
certificate of insurance as evidence of the above insurance which shall provide
that the insurer will give Landlord at least 30 days' written notice prior to
any cancellation, non-renewal or material change in coverage. Tenant shall also,
upon Landlord's request, provide copies of all insurance policies to Landlord.
Tenant shall not conduct any activities in or about the Demised Premises
which will in any way impair or invalidate the insurer's obligations under any
policy of insurance contemplated hereunder or maintained by Landlord with
respect to the Building. In the event any increases in premiums for Landlord's
insurance on the Building are due to increased risk resulting from Tenant's use
of the Demised Premises, Tenant shall pay to Landlord upon demand, as Additional
Rent, the amount of such increase, whether or not Landlord has consented to
Tenant's use.
13. Condemnation: If the entire Demised Premises are taken by eminent
------------
domain, this Lease shall automatically terminate as of the date of taking. If a
portion of the Demised Premises is taken by eminent domain, Landlord shall have
the right to terminate this Lease as of the date of taking by giving written
notice thereof to Tenant within 30 days after such date of taking. If Landlord
does not elect to terminate this Lease, it shall, at its expense, restore the
Demised Premises, exclusive of any improvements or other changes made therein by
Tenant, to as near the condition which existed immediately prior to the date of
taking as reasonably possible, and to the extent that the Demised Premises are
rendered untenantable, the rent payable hereunder shall proportionately abate.
AR damages awarded as compensation for diminution in value of the leasehold
estate hereby created or to the fee of the Demised Premises shall be the sole
property of Landlord; provided, however, that Landlord shall not be entitled to
any separate award made to Tenant for the value and cost of removal of personal
property and trade fixtures belonging to and paid for by Tenants.
11. Hazardous Materials: Tenant covenants, represents and warrants to
-------------------
Landlord, its successors and assigns, that it has not used or permitted and will
not use or permit the Demised Premises to be used, whether directly or through
contractors, agents or tenants, for the generating, transporting, treating,
storage, manufacture, emission or disposal of any petroleum products or any
dangerous, toxic or hazardous pollutants, chemicals, wastes or substances as
defined in the Federal Comprehensive Environmental Response, Compensation and
Liability Act of 1980, or the Federal Resource Conservation and Recovery Act of
1976 or any other federal, state or local environmental
-12-
<PAGE>
laws, statutes, regulations, requirements and ordinances ("Hazardous
Materials"). Tenant agrees to indemnify and reimburse the Landlord, it
successors and assigns, for any breach of these representations and warranties
and from any loss, damage, expense or cost arising out of or incurred by
Landlord which is the result of a breach of, misstatement of or
misrepresentation of the above covenants, representations and warranties,
together with all attorneys, fees incurred in connection with any action brought
by or against the Landlord arising out of the above. These covenants,
representations and warranties shall be deemed continuing covenants,
representations and warranties for the benefit of the Landlord, and any
successor and assigns of the Landlord, including any subsequent owner of the
Building and shall survive termination of this Lease. Notwithstanding the
foregoing, Tenant shall not be responsible under this Section 14 for any
Hazardous Materials introduced to the Demised Premises prior to the Commencement
Date, including any Hazardous Materials used or installed in connection with the
Initial Tenant Improvements.
15. ADA Compliance: Except as may be provided elsewhere in this Lease,
--------------
Tenant covenants, represents and warrants to Landlord, its successors and
assigns, that Tenant shall be responsible for maintaining the Demised Premises
in compliance with the Americans with Disabilities Act of 1990 ("ADA") and with
any other federal, state or local statute or regulation as each may have been
amended from time to time, pertaining to providing access to the Demised
Premises to persons with disabilities or to the removal of existing barriers to
access to the Demised Premises by such individuals and that any future
modifications/ additions to the Demised Premises will comply with the ADA and
all other federal, state or local laws, statutes, regulations or ordinances of
similar nature. Notwithstanding the foregoing, and unless otherwise agreed,
Tenant shall not be responsible for maintaining ADA compliance with respect to
any Common Areas of the Building. Tenant agrees to indemnify and reimburse the
Landlord, its successors and assigns, for any breach of these representations
and warranties and for any and all expense, cost, loss or liability, including
attorneys' fees, which Landlord may incur as the result of a breach,
misstatement of or misrepresentation of such covenants, representations and
warranties or in connection with the application of or enforcement, threatened
or actual, of any federal, state or local law statute, regulation or ordinance,
including the ADA, as a result of such breach. These covenants, representations
and warranties shall be deemed continuing covenants, representations and
warranties for the benefit of the Landlord, and any successor and assigns of the
Landlord, including any subsequent owner of the Demised Premises and shall
survive any termination of this Lease. Notwithstanding the foregoing, Tenant
shall not be responsible under this Section 15 for any failure of the Initial
Tenant Improvements to comply with the ADA as of the Commencement Date.
16. Indemnification: Except for the gross negligence or willful
---------------
misconduct of Landlord, its employees, agents and representatives, Landlord
shall not be liable to Tenant, and Tenant hereby waives all claims against
Landlord, for any injury or damage to any person or property in or about the
Demised Premises by or from any cause whatsoever, and without limiting the
generality of the foregoing& whether caused by snow, ice or water leakage of any
character from the roof, walls, basement or other portion of the Demised
Premises or the Building& or caused by gas, fire, oil, electricity or any cause
whatsoever in, on, or about the Demised Premises or the Building or caused by
the acts of negligence of other tenants or occupants of any part of the
Building.
-13-
<PAGE>
Unless otherwise provided by insurance coverage, Tenant agrees to
indemnify and hold Landlord harmless from and defend Landlord against any and
all liabilities, obligations, damages, penalties, claims, costs, charges and
expenses, including reasonable architect's and attorneys' fees, imposed upon,
incurred by or asserted against Landlord by reason of any injury or damage to
any person or property whatsoever: (a) occurring in, on, or about the Demised
Premises or any part thereof; (b) resulting from any use, non-use, possession,
occupation, condition, operation, maintenance or management of the Demised
Premises or any part thereof, excluding Common Areas; or (c) resulting from any
failure on the part of Tenant to keep, observe, or perform any of the terms
contained in this Lease, except when such injury or damage shall be caused
solely by the gross negligence or willful misconduct of the Landlord.
17. Waiver of Subrogation: Landlord and Tenant hereby expressly release
---------------------
each other, including their respective officers, servants, agents or employees
from any claim or cause of action for any loss or damage whatsoever to the
Building, Demised Premises or property therein or business conducted therefrom
arising out of any negligence or alleged negligence of the other party, their
servants, officers, agents or employees resulting in fire, smoke, explosion or
other insurable perils in the Building or Demised Premises. It is the intention
of the parties that they shall look only to their respective insurance carriers,
if any, for payment of such loss. This shall apply specifically, but not
exclusively, to damages caused by sprinkling devices, heating and air
conditioning apparatus, water, snow, frost, steam, excessive heat or cold,
falling plaster, broken glass, sewage, gas, odor or noise, or the bursting or
leaking of pipes, plumbing fixtures or the roof or wall of the Building.
Tenant and Landlord agree that insurance carried in compliance with
paragraphs 12.A.1 and 12-B-1 and providing coverage for losses described in the
above paragraph shall contain a waiver of subrogation whereby the insurer agrees
to waive any right of recovery against the other party with respect to losses
covered by the insurance whether or not such loss is caused by the fault or
negligence of the other party.
18. Default: Any of the following shall constitute an "Event of
------- Default" :
A. Tenant fails to pay Base Rent, Additional Rent, or any other
payment that Tenant is required to pay under the terms of this
Lease within 10 days after Landlord gives Tenant a written
notice of such default (provided, however, that such 10-day
period shall be reduced to 5 days if Landlord has previously
during the Lease Term given Tenant such a 10-day default
notice, and further provided, however, that Landlord shall not
be required to give Tenant any written notice of such default,
and Tenant shall not be entitled to any grace period, if
Landlord has previously during the Lease Term given Tenant such
a 5-day default notice);
B. This Lease or the Demised Premises or any part of the Demised
Premises are taken upon execution or by other process of law
directed against Tenant, or are taken upon or are subject to
any attachment at the instance of any creditor
-14-
<PAGE>
or claimant against Tenant, and the attachment is not
discharged or disposed of within thirty (30) days after its
levy;
C. Tenant or any guarantor of Tenant files a petition in
bankruptcy or insolvency or for reorganization or arrangement
under the bankruptcy laws of the United States or under any
insolvency act of any state, or admits the material allegations
of any such petition by answer or otherwise, or is dissolved or
makes an assignment for the benefit of creditors;
D. Involuntary Proceedings under any such bankruptcy law or
insolvency act or for the dissolution of Tenant are instituted
against Tenant or any guarantor of Tenant, or a receiver or
trustee is appointed for all or substantially all of the
property of Tenant or such guarantor, and such proceeding is
not dismissed or such receivership or trusteeship vacated
within sixty (60) days after such institution or appointment;
E. Tenant attempts to assign, pledge, mortgage, transfer or sublet
Tenant's interest under this Lease without Landlord's prior
written consent, except as permitted in paragraph 8G; or
F. Tenant breaches any other agreement, term, covenant or
condition of this Lease and such breach continues for a period
of ten (10) days after written notice from Landlord to Tenant,
or, if such breach cannot be cured reasonably within such ten
(10) day period and Tenant fails to commence and proceed
diligently to cure such breach within a reasonable time period
not to exceed thirty (30) days.
If any one or more Events of Default occur, then Landlord may, at Landlord's
option:
(i). Notify Tenant, in writing, that this Lease shall
terminate as of the earliest date permitted by law or on
any later date specified in such notice, and Tenant's
right to possession of the Demised Premises shall cease
as of the date set forth in Landlord's notice of
termination.
(ii). With or without terminating this Lease and without notice
or demand to Tenant, but in accordance with legal
process, re-enter and take possession of the Demised
Premises using such procedures as may, from time to time,
be provided by law to expel Tenant and those claiming
through or under Tenant, and to remove the effects of
either or both. Landlord's exercise of such right of re-
entry shall not subject Landlord to liability for
conversion or trespass and shall not affect Landlord's
right to recover arrearages of rent payable under this
Lease or any amounts due as a result of any preceding
breach of covenants or conditions. No re-entry or taking
possession of the Demised Premises
-15-
<PAGE>
by Landlord will be construed as an election on
Landlord's part to terminate this Lease unless a written
notice of such intention is given to Tenant.
(iii). In the event of re-entry by Landlord as set forth in
subparagraph (ii) above, or should Landlord take
possession pursuant to legal proceedings or otherwise,
Landlord may, from time to time, without terminating this
Lease, re-let the Demised Premises or any part of the
Demised Premises in Landlord's or Tenant's name, but for
the account of Tenant, for such term as Landlord, in its
sole discretion, may determine, and Landlord may collect
and receive any rent resulting from such reletting.
Landlord will have no obligation to relet the Demised
Premises and will in no way be responsible or liable for
any failure to relet the Demised Premises or any part
thereof.
(iv). With or without terminating this Lease and without demand
or notice to Tenant, to cure any Event of Default and
charge Tenant for the cost of effecting such cure,
including, without limitation, attorneys' fees and
interest at the Interest Rate plus 4% per annum.
(v). With or without terminating this Lease, recover from
Tenant an amount equal to the rent owing for the balance
of the Lease Term plus the amount of any past due rent,
less the net proceeds, if any, of any re-letting of the
Demised Premises by Landlord. All Landlord's expenses in
connection with such re-letting, including, but without
limitation, all repossession costs, brokerage
commissions, attorneys fees, expenses for employees,
alteration and repair costs and expenses of preparation
for such re-letting shall be deducted from the proceeds
of any relenting in determining the net proceeds of such
re-letting. Landlord may recover the amount due from
Tenant under this subparagraph (v) monthly, on the day on
which the base rent would have been payable under the
Lease, or, if Landlord so chooses, on a less frequent
basis.
(vi). Elect to terminate this Lease and recover from Tenant, as
liquidated damages and not as a penalty, an aggregate
rent, which, at the time of such termination, represents
the sum of the full amount of any past due rent plus the
amount by which the rent that would have accrued for the
balance of the Lease Term exceeds the fair market value
of the Demised Premises for the same period with such
amount discounted to present value at the lesser of 8% or
the discount rate of the Federal Reserve System on the
date of the Event of Default.
Any suit or suits for the recovery of the amounts and damages set forth above
may be brought by Landlord, from time to time, at Landlord's election, and
nothing in this Lease will be deemed to
-16-
<PAGE>
require Landlord to await the date upon which this Lease or the Lease Term would
have expired had no Event of Default occurred. Each right and remedy provided to
Landlord in this Lease is cumulative and is in addition to any other right or
remedy provided to Landlord in this Lease or existing now or after the date of
this Lease at law or in equity or by statute or otherwise. All costs incurred by
Landlord in collecting any amounts and damages owing by Tenant pursuant to the
provisions of this Lease or to enforce any provision of this Lease, including
reasonable attorneys' fees from the date any such matter is turned over to an
attorney, whether ' or not one or more actions are commenced by Landlord, will
also be recoverable by Landlord from Tenant.
Landlord shall be deemed to be in default under this Lease ff Landlord
breaches any agreement, term, covenant or condition of this Lease and such
breach continues for a period of ten (10) days after written notice from Tenant
to Landlord, or, if such breach cannot be cured reasonably within such ten (10)
day period and Tenant fails to commence and proceed diligently to cure such
breach within a reasonable time period not to exceed (30) days.
19. Notices: All bills, statements, notices or communications which
-------
Landlord may desire or be required to give to Tenant shall be deemed
sufficiently given or rendered if in writing and either delivered to Tenant
personally or sent by registered or certified mail addressed to Tenant at the
Building, and the time of rendition thereof or the giving of such notice or
communication shall be deemed to be the time when the same is delivered to
Tenant or deposited in the mail as herein provided. Any notice by Tenant to
Landlord must be served by registered or certified mail addressed to Landlord
c/o Coldwell Banker First Realty-Encore, 51 Broadway, Suite 305, Fargo, North
Dakota 58102 and to Landlord at the address shown on the Data Sheet above, or in
case of subsequent change upon notice given, to the latest address furnished.
20. Holding Over: Should Tenant continue to occupy the Demised
------------
Premise after expiration of the Lease Term or any renewal or renewals thereof
without executing a new lease with Landlord or its successor in interest, such
holdover tenancy shall be from month to month and in no event from year to year
or for any longer term upon the same terms and conditions set forth in this
Lease, except those relating to the payment of base rent. In the event of such
holdover tenancy, the monthly Base Rent payable by Tenant shall be the greater
of 150% of the Base Rent payable during the last month of the Lease Term or an
amount determined by Landlord as the "market rent" charged by Landlord for
office space in the Building and/or other buildings of similar type and
character. Notwithstanding the foregoing, Tenant shall be liable in damages to
Landlord for failure to vacate the Demised Premises after expiration of the
Lease Term or any renewal.
21. Subordination: The rights of Tenant shall be and are subject and
-------------
subordinate at all times to the lien of any mortgage or mortgages now or
hereafter in force against the real estate on or in which the Building is
located, and Tenant shall execute further instruments subordinating this Lease
to the lien or liens of any mortgage or mortgages as shall be requested by
Landlord; provided that such mortgagee or mortgagees shall recognize the
validity and continuance of this Lease so long as Tenant is not in default under
the terms of this Lease.
-17-
<PAGE>
22. Estoppel Certificate: Tenant shall at any time upon not less than
--------------------
ten (10) days' prior written notice from. Landlord, execute, acknowledge and
deliver to Landlord a statement in writing: (i) certifying that this Lease is
unmodified and in full force and effect (or, if modified, stating the nature of
such modification, indemnifying the instruments of modification and certifying
that this Lease, as so modified, is in full force and effect), and the date to
which the Base Rent, "Security Deposit," Additional Rent and other charges are
paid in advance, if any; and (ii) acknowledging that there are not, to Tenant's
knowledge, any uncured defaults on the part of Landlord hereunder, or specifying
such defaults, if any, which are claimed. Any such statement may be
conclusively relied upon by any prospective purchaser, encumbrancer or other
transferee of the Demised Premises.
Tenant's failure to deliver such statement within such time shall be
conclusive upon Tenant that this Lease is in full force and effect, without
modification except as may be represented by Landlord, that there are no uncured
defaults in Landlord's performance; and that no rent has been paid in advance.
If Landlord so desires to finance or refinance the Demised Premises or
the Building, or any part thereof, Tenant hereby agrees to deliver to Landlord
and/or to any lender designated by Landlord such financial records of Tenant as
may be reasonably required by such lender. Such statements may include but not
be limited to the past three (3) years' financial statements of Tenant. All such
financial statements shall be received by Landlord in confidence and shall be
used only for the purposes herein set forth.
23. Attorneys' Fees and Costs: In the event that either party incurs
-------------------------
attorneys' fees or other costs in order to enforce its right hereunder, the
nonprevailing (or defaulting) party shall pay the other party's reasonable fees
and court or other costs and expenses.
24. Parties/Binding Effect: The term "Tenant", wherever used in this
----------------------
Lease, shall be construed to mean tenants in all cases where there is more than
one tenant, and the necessary grammatical changes required to make the
provisions hereof apply to corporations, partnerships or individuals, men or
women, shall in all cases be assumed as though in each case fully expressed.
Each provision hereof shall extend to and shall bind Tenant and its heirs, legal
representatives, successors and assigns, provided that this Lease shall not
inure to the benefit of any assignee, heir, legal representative, transferee or
successor of Tenant, except upon the express written consent or election of
Landlord. The term "Landlord" as used in this Lease so far as covenants or
obligations on the part of Landlord are concerned shall be limited to mean and
include only the owner or owners of the Building at the time in question, and in
the event of any transfer or transfers or conveyances the then grantor shall be
automatically freed and released from all liability accruing from and after the
date of such transfer or obligation on the part of Landlord contained in this
Lease to be performed, it being intended hereby that the covenants and
obligations contained in this Lease on the part of Landlord shall be binding on
the Landlord, its successors and assigns, only during and in respect to their
respective successive periods of ownership. This Lease shall not be affected by
any such sale or conveyance, and Tenant agrees to attorn to the purchaser or
grantee. Tenant shall look solely to Landlord's interest in the Building for
recovery of any judgment from Landlord. Neither Landlord nor any of its
officers, directors, shareholders, partners, agents or employees, nor any
successor holder of
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<PAGE>
Landlord's interest in the Building or this Lease, shall ever be personally
liable for any such judgment or for the payment of any monetary obligation to
Tenant.
25. Option to Lease: Tenant shall have the option to lease
---------------
approximately 5,000 additional rentable square feet of space located in the
southwest comer of the third floor of the building, as shown upon attached
Exhibit D ("Option Space"). Such option must be exercised, if at all, by
Tenant's written notice of exercise received by Landlord on or before September
1, 1994. If such option is exercised, the Option Space shall be added to the
Demised Premises effective December 1, 1994 and shall be leased by Tenant upon
the same terms and conditions as the initial Demised Premises, including the
Lease Term, except that the annual Base Rent for the Option Space shall be $6.00
per square foot of rentable area contained in the Option Space. Landlord shall
install the initial tenant improvements in the Option Space on or before
December 1, 1994 (subject to any delays caused by plans and specifications
approvals by the parties or applicable governmental units and/or any events of
Force Majeure), in accordance with plans and specifications to be reasonably
agreed upon by Landlord and Tenant, provided, however, that Tenant shall
reimburse Landlord (within 10 days after Landlord bills Tenant) for the cost of
such improvements if and to the extent that such cost exceeds $10-00 per square
foot of usable area in the Option Space ("Excess Costs"). Landlord may require
that estimated Excess Costs be deposited by Tenant with Landlord prior to
Landlord's commencing or completing such initial tenant improvements. The Option
Space shall be incorporated by addendum into this Lease.
26. Right of First Refusal: Tenant shall have a right of first refusal
----------------------
with respect to the leasing of additional space within the premises subject to
the Master Lease defined below and which is configured by Landlord so as to
exceed 2,000 square feet of rentable area. Landlord shall provide to Tenant
written notice of the proposed terms of leasing, describing the proposed
location, area, rental and any other terms Landlord deems to be material.
Tenant shall have 15 days (but only 10 days if Landlord's notice is given to
Tenant on or after December 31, 1996) from the date of such notice to accept in
writing the terms of such leasing. In the event the terms are not so accepted,
Tenants right of first refusal shall expire and be of no effect with respect to
the space so offered to Tenant and Tenant shall not have any right of first
refusal as to any future leasing of such space.
27. Prime Lease: It is understood and agreed that Landlord holds a
-----------
leasehold interest in ' the building and property pursuant to an Agreement of
Lease dated September 9, 1981, between Rauenhorst Corporation and Dakota
Bankshares, Inc. ("Prime Lease") and this Lease shall be subject to consent by
the present fee owner, Dakota Bank Building Limited Partnership ("Prime
Landlord"), substantially in the form of consent attached to this Lease as
Exhibit H, and is subject to all of the terms and conditions of the Prime Lease,
including required consents of the Prime Landlord.
28. Governing Law: This Lease, and the respective rights and
-------------
obligations of Landlord and Tenant hereunder, shall be governed by and construed
in accordance with the internal laws of the State of North Dakota.
29. Severability: ff any provisions of this Lease or the application
------------
thereof to any person or circumstance shall be invalid or unenforceable to any
extent, the remainder of this Lease and the
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<PAGE>
application of such provisions to other persons or circumstances shall not be
affected and shall be enforced to the greatest extent permitted by law.
30. Brokers: Landlord and Tenant each represents and warrants the other
-------
that, except for Coldwell Banker First Realty Encore (whose commission shall be
paid by Landlord), no realtors, brokers or agents were involved in the
negotiation and execution of this lease. Tenant hereby indemnifies Landlord and
agrees to hold Landlord harmless from and against the claim of any other
realtor, broker or agent with whom Tenant may have dealt regarding this Lease or
the Demised Premises.
31. Force Majeure: Any deadline or time period provided in this Lease
-------------
for the performance of any obligation of Landlord shall be extended for the
period of any delay caused by Tenant or by Force Majeure. The term "Force
Majeure" shall mean delays or hindrances to performance by reason of abnormal
weather, the unavailability of government approvals or the revocation thereof,
the unavailability of labor or materials, war, riots, insurrection, fire,
casualty, strike, lockouts, labor disputes, power failures, Acts of God, the
elements or any other cause beyond Landlord's reasonable control.
-20-
<PAGE>
IN WITNESS WHEREOF, the respective parties hereto have executed this
Lease or caused this Lease to be executed by their duly authorized
representatives in duplicate the day and year first above written.
FIRST BANK SYSTEM, INC.,
a Delaware corporation,
By /s/ Raymond C. Hoy
-----------------------------------------
Its Vice President
--------------------------------------
SHIELDS ENTERPRISES, INC.
By /s/ Lorinne L. Lunde
-----------------------------------------
Its Treasurer
--------------------------------------
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<PAGE>
NOTE: The information provided on this Data Sheet is for convenience purposes
only. In the event of any conflict or inconsistency between the Data Sheet and
the terms of the attached Lease, the terms of the Lease shall be controlling.
<PAGE>
EXHIBIT A
[FLOOR PLAN OF SECOND FLOOR]
<PAGE>
EXHIBIT A-1
The following property in the City of Fargo, County of Cass and State of North
Dakota:
Lots 1, 2, 3, 4 and 5, except the South 100 feet of said Lots;
Lots 6 and 7, except air rights above 15 feet over the South 116 feet of
said Lots;
Lots 8, 9, 10, 11 and 12, except the South 116 feet of said Lots;
Lots 13, 14, 20, 21 and 22;
All of the vacated alley lying South of said Lots 13 and 22 and lying North
of said Lots 1 through 12, inclusive;
All in Block 1, Kenney & Devitt's 1st Addition to the City of Fargo, Cass
County, North Dakota, according to the recorded plat thereof.
<PAGE>
EXHIBIT B
WORK LETTER
Section 6 of the Lease between Shields Enterprises Inc., as Tenant, and
First Bank Systems, Inc., as Landlord of even date herewith ("Lease") provides
that Initial Tenant Improvements to the Demised Premises subject to the Lease
should be made in accordance with this letter. The purpose of this letter is to
set forth additional terms and conditions relating to the construction of such
improvements, which terms are as follows:
1. Landlord has constructed the Initial Tenant Improvements, at
Landlord's sole expense.
2. A synopsis of the Initial Tenant Improvements is as follows:
Demolition: The existing walls were removed per agreed floor
layout dated 4/13/94, and drawn by Prairie Design
Studio. Existing carpet was removed. Debris was
disposed and cleaned for re-fitting.
Ceiling: The ceiling grid was reworked to provide a
continuous pattern in each of the three major open
areas. This includes engineered placement of
overhead lighting compatible to computer terminal
operation.
Wall Surfaces: All wall surfaces were patched and painted with
tenant's color choice. Existing vinyl surfaces, in
rooms 202, 203, 204, 205, 214, 216, 217 & 211 were
cleaned and left in place.
Flooring: All new carpet of tenant's choice, providing it is
within the approved flooring allowance, was
installed except in rooms 202, 203, 204, & 206
where existing carpet if acceptable. Rooms 207,
208, 211 & 218 were surfaced with vinyl
composition tile.
Cabinets: Upper and lower cabinets and counter tops covered
with laminated plastic with a single blow sink
were installed in room 21 1, the break room.
Laminated plastic lower cabinets and work surface
with adjustable shelving above were installed in
the work room, #218.
B-1
<PAGE>
Coat rods with wire shelving above were provided
on two walls in the coat room, #212.
Storage room #220 was fit with sturdy open
shelving along the north wall only.
Door Locks: Standard lockable door passages were installed in
storage rooms and office doors as outlined by
Tenant's personnel. This includes one push button
"Simplex" lock on the phone room, #208.
Cooling: The computer room, #207, will be cooled based on
heat load information provided by Tenant's
personnel, by a separate cooling unit with its own
thermostat.
The balance of the heat pumps in the office and
open areas are ducted to provide as even as
possible heat and cooling. There are several
thermostats provided throughout the area.
Electrical: Wall outlets, standard and dedicated, have been
provided as indicated by Tenant's personnel.
Overhead electrical wire feeds have been installed
to the power poles supplying power to the office
cubicles.
Phone Room: The phone room, #208, has two 4'x8' plywood sheets
installed as mounting boards for the telephone
punch down blocks.
Wiring: All computer communication wiring and phone jacks
and associated wiring and installation are the
sole responsibility of Tenant.
Window Treatment: All exterior windows are presently fit with mini
blinds and will stay in place as is.
3. All such construction has been completed in accordance with the
plans and specifications approved by Tenant and is in conformance
with general building requirements regarding construction.
4. Landlord agrees that, subsequent to the date of the Lease, Tenant
may utilize as temporary facilities approximately 2,000 square feet
of space in the lower level of the building as designated by
Landlord, until the Demised Premises are available for occupancy.
There shall be no additional rental charge for this temporary
occupancy. However, any costs of installation of temporary telephone
or other facilities and any
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<PAGE>
costs of returning the area to its original condition shall be the
expense of the Tenant, together with any telephone or other utility
charges attributable to such use.
This letter shall be attached to the Lease and shall be considered part
of such Lease for all purposes.
FIRST BANK SYSTEM, INC.,
a Delaware corporation,
By _________________________________________
Its ______________________________________
SHIELDS ENTERPRISES, INC.
By _________________________________________
Its ______________________________________
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<PAGE>
EXHIBIT C
TENANT'S SIGNAGE DESCRIPTIONS AND LOCATIONS
-------------------------------------------
[FLOOR PLAN OF WEST ELEVATION]
<PAGE>
[COLDWELL BANKER NOTICE]
<PAGE>
EXHIBIT D
OPTION SPACE DESCRIPTION
[FLOOR PLAN OF THIRD FLOOR]
<PAGE>
EXHIBIT E
Date: June 6, 1994
To: Mark Richman, Coldwell Banker
cc: Lori Lunde, SEI
From: Jackie Ford
Re: Office Equipment
----------------
When fully staffed, the current SEI facility in Fargo will house the following
equipment:
. 105 PCS (including 5 RS6000 machines)
. 6 laser printers
. 12 Point-of-Sale terminals
. 1 Automated Call Distribution System cabinet
. 2 fax machines
. 2 high volume copiers
. 20 modems
Please call me at 708/515-3600 if you need additional information. I will be
available at this number until Wednesday.
saa
<PAGE>
EXHIBIT F
DAKOTA CENTER CUSTODIAL
Custodial:
The Dakota Center Building employs Automated Maintenance Services as an
independent contractor to provide us with the cleaning service. At the
present time they provide service five days a week, generally starting at
6:00 PM until their work is completed. Their service includes but is not
limited to:
Nightly:
1. Empty all waste receptacles and dispose of waste.
2. Dust and damp mop all resilient tile floors.
3. Vacuum and spot clean all carpeted areas.
4. Low dusting of desks, file cabinets and furnishings.
5. Spot clean of doors, partition glass, light switch areas.
6. Clean and disinfect restroom fixtures and floors.
7. Spot wash restroom partitions, doors and walls.
Monthly:
1. Scrub & recondition resilient floors.
2. Vacuum or dust air supply diffusers or grills.
3. Dust window blinds.
Quarterly:
1. Light dust surfaces not reached in nightly duties, such as door
frames, picture frames or wall hangings.
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<PAGE>
EXHIBIT G
DAKOTA CENTER SECURITY
Security:
The building is opened at approximately 6:30 AM Monday thru Friday by
the building engineer, at which time he walks through the structure
checking for potential problems.
At approximately 6:00 PM the custodial service locks the exterior doors
to the building and they check through the night for any security
breaches. They have a list of available personnel to contact should they
encounter any problems.
All other times the building is locked with only key access by the
tenants through self closing and locking doors.
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<PAGE>
THIS INSTRUMENT DRAFTED BY
AND WHEN RECORDED RETURN TO:
Kenneth T. Tyra
Dorsey & Whitney
2200 Pillsbury Center South
220 South Sixth Street
Minneapolis, Minnesota 55402
<PAGE>
TABLE OF CONTENTS
PAGE
----
1. Demised Premises........................................................ 1
2. Use..................................................................... 1
3. Term.................................................................... 1
4. Base Rent............................................................... 1
5. Additional Rent......................................................... 1
6. Tenant's Expense Credit and Special Charge.............................. 4
7. Landlord and Tenant Improvements........................................ 4
8. Services................................................................ 6
9. Covenants of Tenant..................................................... 7
10. Rights Reserved by Landlord............................................. 9
11. Casualty Loss........................................................... 10
12. Insurance............................................................... 11
13. Condemnation............................................................ 12
14. Hazardous Materials..................................................... 12
15. ADA Compliance.......................................................... 13
16. Indemnification......................................................... 13
17. Waiver of Subrogation................................................... 14
18. Default................................................................. 14
19. Notices................................................................. 17
20. Holding Over............................................................ 17
21. Subordination........................................................... 17
22. Estoppel Certificate.................................................... 18
23. Attorneys' Fees and Costs............................................... 18
24. Parties/Binding Effect.................................................. 18
25. Option to Lease......................................................... 19
26. Right of First Refusal.................................................. 19
27. Prime Lease............................................................. 19
28. Governing Law........................................................... 19
29. Severability............................................................ 19
30. Brokers................................................................. 20
31. Force Majeure........................................................... 20
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