2000-06-13t
s
• MEETING OF THE MOUND
HOUSING AND REDEVELOPMENT AUTHORITY
2020 COMMERCE BOULEVARD
MOUND, MINNESOTA 55364
DATE: JUNE 13, 2000, 7:00 P.M.
LOCATION: COUNCIL CHAMBERS, MOUND CITY HALL
ROLL CALL:
TAX INCREMENT FINANCING AGENDA:
1. APPROVE MINUTES OF MAY 23, 2000, HRA MEETING.
2. RESOLUTION AUTHORIZING CERTAIN REVISIONS TO
CONTRACT FOR PRIVATE REDEVELOPMENT WITH
RAY MAR PROPERTIES, INC.
3. ADJOURN
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HRA NIINUTES -REGULAR MEETING -MAY 23, 2000
The Housing and Redevelopment Authority of the City of Mound, Hennepin County,
Minnesota, met in a regular session on Tuesday, May 23, 2000, at 7:00 p.m., in the Council
Chambers at 5341 Maywood Road, in said City.
Those present: Chairperson Pat Meisel; HRA Board Members: Bob Brown, Mazk Hanus
and Leah Weycker. Absent and excused: HRA Board Member Andrea Ahrens and City
Clerk Fran Clazk. Also in attendance were HRA Director Pinky Charon, City Manager
Kandis Hanson, City Attorney John Dean, James D. Prosser of Ehlers & Associates, Inc.,
and Secretaries Sue McCulloch and Diana Mestad. Others present: Susan & Terance
Almquist, Cathy Bailey, Janice Beise, John & Kristen Beise, Marilyn Byrnes, Sue & Tom
Gathers, Steve Coddon, Sally Custer, Cathi & Tom Desszighy, Dave Deters, Bruce & Patti
Dodds, Henry Ebert, Mike Empson, June Estelle, John & Shirley Evans, Marty & Gene
Garvais, Mike, Paul & Tom Gaudette, Patrick Griffen, Patty Guttormson, Brian & Theresa
Gulrud, Bryan Haimes, Lorrie Ham, Gina Harty, Jeff & Marlene Harty, Dean Lattin, Muriel
Lattin, Sharon Lock, Jo Longpre, Steven Maddock, Michael Mueller, Peter Meyer, Bill &
Dorothy Netka, Dotty O'Brien, Leona Peterson, Marion Poteete, Roger Reed, Jim Regan,
John Roxel, Kathy Rue, Cathy Scanlon, Loren Schmidt, Mary Steen, Betty Strong, John
Taffe, Mazgazet Thorne, Tom Turner, Greg Ward, Frank Weiland, Jack Weist, Roger
Westman.
*Consent Agenda: All items listed under this Consent Agenda are considered to be routine by
the Housing and Redevelopment Authority. There will be no separate discussion of these
items unless a Councilmember or citizen so request, in which event the item will be removed
from the Consent Agenda and considered in normal sequence.
Chairperson Meisel called the meeting to order at 7:05 p.m.
APPROVAL OF AGENDA AND CONSENT AGENDA.
*1.0 INDIAN KNOLL MANOR CONSENT AGENDA.
A. Monthly Bills.
B. Minutes -March 25, 2000.
MOTION.
Hanus, Weycker, unanimously.
1.1 ACCOUNTING TTEMS.
A. Accountant Reports.
B. Bank Reports.
MOUND HRA MINUTES -MAY 23. 2000
HRA Director reported two months of reports. She stated on March 31, 2000, the City was
six months into budget and doing well. She noted the contract services were high and the
capital improvement money is going for most of these services. HRA Director stated the
City is progressing fine.
HRA Director stated the MBIA money has not been implemented and has an account at
Norwest, which is where the levy money is going in at this time. She explained the money
is not restricted if the need arises to take the money out.
HRA Director stated the balance at the Marquette Bank is a large balance and she would like
to get a better reporting system for the future.
1.2 H.R.A. ACTION ITEMS.
HRA Director stated there were no action items. She mentioned she would be working out a
budget for the year 2001 next month. She stated the five-year plan would now be due in
September because of an extension.
1.3 INFORMATION ITEMS.
A. CBDG GRANT.
HRA Director reported the CBDG Grant was missed this year. The administrators thought
the $100,000 for handicapped accessible units was logical but not the best way to spend the
money at this time. She stated she would continue to apply for the grant during the
upcoming years.
B. PHAS (advisory score).
PHAS report card was favored and an award was to be presented. She stated the financial
category is the lowest because there is no reserve at this time and there is no capital money
to have put back into the building at this time.
C. OIL TANK.
HRA Director reported the oil tank in the front of the building is being worked on by the
City Engineer in hopes to have it removed shortly. The City Manager stated she ordered
estimates on the removal of the tank and she is waiting to receive the estimates.
1.4 TENANT REPRESENTATIVE REPORT.
The tenant representative was absent.
1.5 MISCELLANEOUS.
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MOUND HRA MINUTES -MAY 23. 2000
The next Indian Knoll Manor meeting is scheduled for June 27, 2000.
TAX INCREMENT FINANCING.
1.6 APPROVE MINUTES OF MAY 9. 2000.
MOTION by Hanus, seconded by Weycker, to approve the minutes of May 9,
2000. The vote was unanmously in favor. Motion carried. 40.
PUBLIC HEARINGS:
1.7 PUBLIC HEARING TO CONSIDER THE ESTABLISHMENT OF BUSINESS
SUBSIDIES CRITERIA. PURSUANT TO MINN. STAT. SEC. 1167.993-
116 .995.
Mr. James Prosser of Ehlers & Associates, Inc. presented the case. He stated the statute
requires the HRA and City Council establish criteria for use of a business subsidy,
specifically mentioning TIF but this would apply to any type of assistance. He stated the
criteria provided has been available for review and it would take a look at the but-for test to
be consistent with the goals of community and the Comprehensive Plan and the need to show
the need for the assistance. The general criteria, including improvement, essentially would
double the tax base, but depending on situation, there is flexibility as well. Mr. Prosser
stated 50 percent of the building would be preleased. He stated there would be indication of
adequate equity from the developer and any displacement of low or moderate income would
be addressed, such as housing. Mr. Prosser explained subsequent to the critena, the
legislation adopted new guidelines causing the criteria to be reviewed again at a later date in
time when the new law has been fully absorbed.
Chairperson Meisel opened the public hearing opened at 7:11 p. m.
Tom Gaudette, 3006 Bluffs Drive. Mr. Gaudette was concerned about the type of city funds
this criteria would involve. The City attorney stated these are not specific funds being
mentioned in the criteria. He stated this is the HRA criteria which would involve funds that
came into possession of the HRA, such as other grants and other sources of funding.
Chairperson Meisel closed the public hearing at 7:13 p.m.
MOTION by Hanus, seconded by Weycker, to accept the resolution as submitted.
RESOLUTION #00- G ~ RESOLUTION ADOPTING BUSINESS
SUBSIDY CRITERIA.
The vote was unanimously in favor. Motion carved. 4-0.
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MOUND HRA MINUTES -MAY 23, 2000
1.8 PUBLIC HEARING TO CONSIDER A PROPOSED BUSINESS SUBSIDY TO
BE GRANTED BY THE HRA TO RAY MAR PROPERTIES. INC. A/K/A
MOUND FAMILY HARDWARE STORE ("THE RECIPIENT"). UNDER
MINN STAT. SEC. 116T.993-116.T.994. THE PROPOSED SUBSIDY
INVOLVES TAX INCREMENT FINANCING ASSISTANCE TO FACILITATE
DEVELOPMENT BY THE RECIPIENT OF A RETAIL CENTER INCLUDING
A HARDWARE STORE IN THE CITY OF MOUND.
The City Attorney stated the HRA has now adopted a business subsidy criteria. He stated to
that end there is now a business subsidy agreement between the HRA and Ray Mar
properties, which is the developer of the Coast to Coast and Dodds property, that would need
to be approved by public hearing as well. The City Attorney stated the Article 10 of the
agreement mentions the business subsidy criteria which states an amount of $250,000 and
interest, will be provided to assist Ray Mar in the development of the hardware store and
related facilities on the redevelopment property. He mentioned an exchange would also take
place but the exchange would be a zero net exchange. The City Attorney stated the
developers' obligations are first, to repay the $250,000 pursuant to a note attached to
contract, and, secondly, to continue to utilize the site for at least five years for purposes set
forth in the agreement. There is a mention of a modest wage and job goal obligations of .5
employees and 100 percent of wage. The City Attorney stated the provisions in the contract
concerning the wage and job goal have changed by legislation and will not be included in
other agreements as of August 1, 2000. The remedies of the agreement are if they fail to
meet the wage and job goals, they need to pay back a portion of the tax increment received
during the period of time of the agreement.
HRA Board Member Weycker questioned the .5 employee consideration. The City Attorney
stated this was a modest number that was put in the agreement because of law that will be
changing as of August 1, 2000.
HRA Board Member Weycker asked if this section is included in the City Council packet as
well. The City Attorney agreed and stated by law the City Council is required to approve
the agreement as well.
Chairperson Meisel opened the public hearing at 7:20 p.m.
Chairperson Meisel closed the public hearing at 7:21 p.m.
MOTION by Weycker, seconded by Brown, to accept the resolution as submitted.
RESOLUTION #00- p ~l RESOLUTION ADOPTING BUSINESS
SUBSIDY AGREEMENT.
The vote was unanimously in favor. Motion carried. 4-0.
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MOUND HRA MINUTES -MAY 23. 2000
The City Attorney stated one provision of the criteria agreement, as well as the
redevelopment contract, is that abut-for analysis be performed to decide if the assistance is
favorable.
1.9 EVALUATION OF MAXWELL PROPERTY.
Chairperson Meisel mentioned a letter from Staff giving cost estimates for environmental and
soil testing has not been acquired in time for this meeting.
ADJOUl~'VMENT
MOTION by Brown, seconded by Weycker, to adjourn the meeting at 7:25 p.m.
The vote was unanimously in favor. Motion carried. 40.
Kandis Hanson, City Manager
Attest: Chairperson Meisel
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N~~r
ITEM # ~~'
-az~ ~o
moved and ~ seconded a motion
The (Roll Call) vote was unanimously/ in favor with nays.
ITEM #
C~.~,(sy~.l~ moved and ~Jy~-iv-n , seconded a motion
The (Roll Call) vote was unanimously/ ~~in favor with nays.
ITEM #
~~/pruel'~'~.. moved and seconded a motion
The (Roll Call) vote was unanimously/ in favor with nays.
ITEM #
moved and
seconded a motion
The (Roll Call) vote was unanimously/ in favor with nays.
HRA RESOLUTION NO.
RESOLUTION AUTHORIZING CERTAIN
REVISIONS TO CONTRACT FOR PRIVATE
REDEVELOPMENT WITH RAY MAR
PROPERTIES, INC.
WHEREAS, the HRA did on April 25, 2000 approve the form of a contract for private
redevelopment between the HRA and Ray Mar Properties, Inc. (the "Contract"); and
WHEREAS, subsequent to such approval it has become necessary to make certain
modifications to the Contract; and
WHEREAS, the Board has received the report and recommendations of its staff regarding
such modifications, and determines the same to be necessary and appropriate and in furtherance of
the proposed development.
NOW THEREFORE, BE IT RESOLVED by the Housing and Redevelopment Authority
in and for the City of Mound, Minnesota as follows:
1. Section 8.2 of the Contract is modified by revising the second paragraph of said section
to read as follows:
"In addition to the foregoing, in order to facilitate the obtaining of construction or permanent
financing of the Minimum Improvements, the HRA agrees to subordinate its rights under this
agreement and the Mortgage to a mortgage given ,
row River Bank in the nrincinal amount of X1.088.000.00."
2. Article XI is amended by adding thereto the following new Section 11.7:
"Section 11.7. Lease. At Closing, and as a precondition thereto, the parties shall execute a
mutually acceptable lease providing for the Redeveloper's continued occupancy of the Redeveloper
Exchange Parcel pending completion and occupancy of the Minimum Improvements."
3. Exhibit C of the Contract is modified by revising paragraph 9 thereof to read as follows:
"9. Use by Others. It is understood that the HRA shall have the right to make parking
spaces in the Parking Lot available to other owners and tenants and to the general public. It is
understood that all spaces shall be available on a first come-first served basis. It is further
understood that the HRA may in its discretion place restrictions on parking such as, without
limitation, time limits, times of day, and types of vehicle; provided, however, that the HRA agrees
not to place restrictions on parking which unreasonably and materially interfere with the business
of the Redeveloper or its tenants on the Redevelopment Property. It is further understood that the
HRA may close the Parking Lot when such closure is, in the judgment of the HRA, necessary for
lot repairs, maintenance. reconstruction or for civic celebrations."
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In all other respects, the Contract remains unmodified.
The foregoing resolution was moved by board member and seconded by
board member
The following board members voted in the affirmative
The following board members voted in the negative
Dated:
Pat Meisel, Chair
Attest:
Secretary
JBD-181586v1
MU195-7
HRA RESOLUTION NO.
RESOLUTION AUTHORIZING CERTAIN
REVISIONS TO CONTRACT FOR PRIVATE
REDEVELOPMENT WITH RAY MAR
PROPERTIES, INC.
WHEREAS, the HRA did on Apri125, 2000 approve the form of a contract for private
redevelopment between the HRA and Ray Mar Properties, Inc. (the "Contract"); and
WHEREAS, subsequent to such approval it has become necessary to make certain
modifications to the Contract; and
WHEREAS, the Board has received the report and recommendations of its staff regarding
such modifications, and determines the same to be necessary and appropriate and in furtherance of
the proposed development.
NOW THEREFORE, BE IT RESOLVED by the Housing and Redevelopment Authority
in and for the City of Mound, Minnesota as follows:
1. Section 8.2 of the Contract is modified by revising the second paragraph of said section
to read as follows:
"In addition to the foregoing, in order to facilitate the obtaining of construction or permanent
financing of the Minimum Improvements, the HRA agrees to subordinate its rights under this
agreement and the Mortgage to a mortgage given ~ ,
fo Crow River Bank in the nrincinal amount of $1.088.000.00."
2. Article XI is amended by adding thereto the following new Section 11.7:
"Section 11.7. Lease. At Closing and as a precondition thereto, the parties shall execute a
mutually acceptable lease providing for the Redeveloper's continued occupancv of the Redeveloper
Exchange Parcel pending completion and occupancv of the Minimum Improvements."
3. Exhibit C of the Contract is modified by revising paragraph 9 thereof to read as follows:
"9. Use by Others. It is understood that the HRA shall have the right to make parking
spaces in the Parking Lot available to other owners and tenants and to the general public. It is
understood that all spaces shall be available on a first come-first served basis. It is further
understood that the HRA may in its discretion place restrictions on parking such as, without
limitation, time limits, times of day, and types of vehicle; provided, however, that the HRA agrees
not to place restrictions on parking which unreasonably and materially interfere with the business
of the Redeveloper or its tenants on the Redevelopment Property. It is further understood that the
HRA may close the Parking Lot when such closure is, in the judgment of the HRA, necessary for
lot repairsy maintenance. reconstruction or for civic celebrations."
JBD-181586v1
MU195-7
In all other respects, the Contract remains unmodified.
The foregoing resolution was moved by board member and seconded by
board member
The following board members voted in the affirmative
The following board members voted in the negative
Dated:
Pat Meisel, Chair
Attest:
Secretary
JBD-181586v1
MU195-7
HRA RESOLUTION NO.
RESOLUTION AUTHORIZING CERTAIN
REVISIONS TO CONTRACT FOR PRIVATE
REDEVELOPMENT WITH RAY MAR
PROPERTIES, INC.
WHEREAS, the HRA did on Apri125, 2000 approve the form of a contract for private
redevelopment between the HRA and Ray Mar Properties, Inc. (the "Contract"); and
WHEREAS, subsequent to such approval it has become necessary to make certain
modifications to the Contract; and
WHEREAS, the Board has received the report and recommendations of its staff regarding
such modifications, and determines the same to be necessary and appropriate and in furtherance of
the proposed development.
NOW THEREFORE, BE IT RESOLVED by the Housing and Redevelopment Authority
in and for the City of Mound, Minnesota as follows:
1. Section 8.2 of the Contract is modified by revising the second paragraph of said section
to read as follows:
"In addition to the foregoing, in order to facilitate the obtaining of construction or permanent
financing of the Minimum Improvements, the HRA agrees to subordinate its rights under this
agreement and the Mortgage to a mortgage given ,
o Crow River Bank in the nrincinal amount of $1.088.000.00."
2. Article XI is amended by adding thereto the following new Section 11.7:
"Section 11.7. Lease. At Closing, and as a precondition thereto, the parties shall execute a
mutually acceptable lease providing for the Redeveloper's continued occupancy of the Redeveloper
Exchange Parcel pending completion and occupancy of the Minimum Improvements."
3. Exhibit C of the Contract is modified by revising paragraph 9 thereof to read as follows:
"9. Use by Others. It is understood that the HRA shall have the right to make parking
spaces in the Parking Lot available to other owners and tenants and to the general public. It is
understood that all spaces shall be available on a first come-first served basis. It is further
understood that the HRA may in its discretion place restrictions on parking such as, without
limitation, time limits, times of day, and types of vehicle; provided, however, that the HRA agrees
not to place restrictions on parking which unreasonably and materially interfere with the business
of the Redeveloper or its tenants on the Redevelopment Property. It is further understood that the
HRA may close the Parking Lot when such closure is, in the judgment of the HRA, necessary for
lot repairs, maintenance. reconstruction or for civic celebrations."
JBV-islsa6~i
MU195-7
In all other respects, the Contract remains unmodified.
The foregoing resolution was moved by board member and seconded by
board member
The following board members voted in the affirmative ;
The following board members voted in the negative
Dated:
Pat Meisel, Chair
Attest:
Secretary
JBD-181586v1
MU195-7
•
HRA RESOLUTION NO.
RESOLUTION AUTHORIZING CERTAIN
REVISIONS TO CONTRACT FOR PRIVATE
REDEVELOPMENT WITH RAY MAR
PROPERTIES, INC.
•
WHEREAS, the HRA did on Apri125, 2000 approve the form of a contract for private
redevelopment between the HRA and Ray Maz Properties, Inc. (the "Contract"); and
WHEREAS, subsequent to such approval it has become necessary to make certain
modifications to the Contract; and
WHEREAS, the Boazd has received the report and recommendations of its staff regazding
such modifications, and determines the same to be necessary and appropriate and in furtherance of
the proposed development.
NOW THEREFORE, BE IT RESOLVED by the Housing and Redevelopment Authority
in and for the City of Mound, Minnesota as follows:
1. Section 8.2 of the Contract is modified by revising the second pazagraph of said section
to read as follows:
"In addition to the foregoing, in order to facilitate the obtaining of construction or permanent
financing of the Minimum Improvements, the HRA agrees to subordinate its rights under this
agreement and the Mortgage to a mortgage given ,
to Crow River Bank in the principal amount of $1,088,000.00."
2. Exhibit C of the Contract is modified by revising pazagraph 9 thereof to read as follows:
•
"9. Use by Others. It is understood that the HRA shall have the right to make pazking
spaces in the Parking Lot available to other owners and tenants and to the general public. It is
understood that all spaces shall be available on a first come-first served basis. It is further
understood that the HRA may in its discretion place restrictions on parking such as, without
limitation, time limits, times of day, and types of vehicle; provided, however, that the HRA agrees
not to place restrictions on pazking which unreasonably and materially interfere with the business
of the Redeveloper or its tenants on the Redevelopment Property. It is further understood that the
HRA may close the Parking Lot when such closure is, in the judgment of the HRA, necessary for
lot repairs, maintenance, reconstruction or for civic celebrations."
In all other respects, the Contract remains unmodified.
The foregoing resolution was moved by board member
boazd member
and seconded by
JBD-181586v1
ML)195-7
LEASE
THIS INDENTURE made and entered into as of this day of
2000 by and between THE HOUSING AND
REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF MOUND,
MINNESOTA, a Minnesota public body corporate and politic, (hereinafter
referred to as "Landlord"), and RAY MAR PROPERTIES, INC.,, a Minnesota
corporation (hereinafter referred to as "Tenant").
WITNESSEThT:
ARTICLE I -GRANT, TERM, AND RENEWALS
1.1 DEMISED PREMISES. In consideration of the rents, covenants
and agreements herein reserved and contained on the part of Tenant to be
performed, Landlord does hereby lease to Tenant that portion of the land
and building located at 2250 Commerce Boulevard, Mound, Minnesota
and legally described in the attached Exhibit A (hereinafter referred to as
the "Demised Premises").
1.2 TERM. The term of this Lease and Tenant's obligation shall
commence as of June _, 2000 and the term of the lease shall expire on
December 31, 2000.
ARTICLE II -RENT
2.1 RENT. The rent for the term of the Lease ($1.00) shall be
payable upon the execution of this Lease by all the Parties.
ARTICLE III -TAXES
3.1. TAXES. The Landlord shall be responsible for all real estate
taxes and installments on special assessments which are either levied, or
due, or payable during the term of this Lease.
ARTICLE IV -USE OF PREMISES
4.1 TENANTS USE. During the term of this Lease, the Demised
Premises shall be used solely for purposes permitted by law.
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4.2 COMPLIANCE WITH LAWS AND REGULATIONS. Tenant
covenants and agrees that at all times during the term hereof it will
maintain and conduct its business insofar as the same relates to the
occupancy of the Demised Premises in such a manner and under such
regulations that are in strict compliance with any and an applicable
governmental and/or quasi-governmental laws, rules, regulations and
orders, as well as any and all applicable provisions of insurance
underwriters at the Demised Premises and the Declaration. Tenant shall
indemnify Landlord, Landlord's insurer, and the property of Landlord
against any and all claims or losses or actions or causes of action resulting
from Tenant's failure to comply with said laws, rules, regulations and
orders and underwriting provisions.
4.3 AFFIRMATIVE COVENANTS OF TENANT. Without in any way
limiting or restricting other covenants of Tenant elsewhere in this Lease
contained, the Tenant affirmatively covenants and agrees as follows:
(a) Tenant shall neither permit or suffer and conduct, noise, odor
or other nuisance in, on or about said Demised Premises to annoy or
disturb any persons occupying adjacent buildings or public areas;
(b) Tenant shall keep said Demised Premises clean and in the
sanitary condition required by ordinance and regulations of any
governmental or quasi-governmental unit having jurisdiction;
ARTICLE V -MAINTENANCE AND REPAIRS
5.1 ACCEPTANCE OF PREMISES. The Tenant accepts the
Demised Premises AS IS, AND WHERE IS with all faults and defects.
Tenant acknowledges that the Landlord shall have no obligation of any
nature to maintain, preserve or repair the Demised Premises. Should the
Demised Premises become uninhabitable at any time during the term of
this lease, the Lease shall immediately terminate.
5.2 SURRENDER OF PREMISES. At the expiration or termination
of this Lease, Tenant shall surrender the Demised Premises in the same
condition as existed on the commencement date of this Lease, damage not
caused by Tenant and ordinary wear and tear excepted. Landlord shall
have the burden of establishing that any damage to the Demised Premises
was caused by Tenant.
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ARTICLE VI - UTII.IT~S
6,1 CHARGES, Tenant shall pay for all utility services including
gas, electricity, domestic water, sewer, hot water for heating and
ventilating, chilled water for cooling and ventilating the Demised Premises
and all other utility services furnished the Tenant for use in the Demised
Premises.
ARTICLE VII -ALTERATIONS
7.1 NOTICE TO LANDLORD. Prior to the initiation of any alterations, Tenant
shall give Landlord written notice thereof and specify the work to be performed in
reasonable detail and include the names of the contractors and materialmen to be utilized.
After receipt of said notice, Landlord shall have a reasonable period of time during which it
shall make a determination, in its sole discretion, as to whether or not the proposed work
would create a structural or design change at the Demised Premises, or increase the cost of
demolition. Tenant shall provide Landlord upon request with any further information
reasonably necessary for such determination by Landlord and Tenant shall not commence
work or accept materials prior to receiving written notice of Landlord's determination. If
Landlord determines that the proposed work would create a structural or design change, or
increase the cost of demolition, then the same must be approved in writing by Landlord
prior to the commencement of any work or the delivery of any materials therefor.
ARTICLE VIII -PUBLIC LIABILITY, INDEMNITY
8.1 TENANT'S LIABILITY INSURANCE. Tenant shall during the
entire term hereof keep in full force and effect a policy of liability and
property damage insurance with respect to the Demised Premises, and the
business operated by Tenant, in which the limits of liability shall be the
same as the Policy limits which Landlord carrys on its general
comprehensive public liability coverages.
8.2 INDEMNIFICATION. Except for claims arising out of the willful
or negligent act of the other party or its representatives, each party shall
indemnify and defend the other party against all claims, expenses and
liabilities incurred, including reasonable attorneys' fees, in connection with
loss of life, personal injury, and/or damage to property arising out of any
occurrence in, upon or at the Demised Premises, or the occupancy or use
thereof by said party, or occasioned wholly or in part by any act or
omission of said party, its agents, employees, contractors. This provision
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shall not be deemed as a waiver of any statutory liability limits available to
Landlord.
ARTICLE ~ -DESTRUCTION AND RESTORATION
9.1 DAMAGED. If a significant portion of the Demised Premises
shall be damaged or damaged by any uninsured casualty, Landlord shall
have the option to rebuild or to terminate this Lease by exercise of notice to
Tenant given not more than 30 days from the date of such damage.
9.2 INDEMNIFICATION. Each party hereto ("Releasing Party")
hereby releases the other ("Released Party") from any liability which the
Released Party would, but for this paragraph, have had to the Releasing
Party arising out of or in connection with any accident or occurrence or
casualty:
(a) which is or would be covered by a fire and extended coverage
policy (with vandalism and malicious mischief endorsement
attached) or by a sprinkler leakage or water damage policy in
the state in which the Demised Premises is located regardless
of whether or not such coverage is being carried by the
Releasing Party, and
(b) to the extent of recovery under any other casualty or property
damage insurance being carried by the releasing Party at the
time of such accident or occurrence or casualty, which
accident or occurrence or casualty may have resulted in whole
or in part from the act of neglect of the Released Party, its
officers, agents or employees, provided, however, the release
hereinabove set forth shall become inoperative and null and
void if the Releasing Party contracts for the insurance required
to be carried under the terms of this Lease with an insurance
company which:
(1) Takes the position that the existence of such release
vitiates or would adversely affect any policy so insuring
the Releasing Party in a substantial manner and notice
thereof is given to the Released Party, or
(2) Requires the payment of a higher premium by reason of
the existence of such release, unless in the latter case the
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Released Party within ten (10) days after notice thereof
from the Releasing Party pays such increase in premium.
9.3 NOTICE. Tenant shall give immediate written notice to
Landlord of any damage caused to the demised Premises by fire or other
casualty; or of any cancellation or reduction of Tenant's insurance
coverage required pursuant to this Lease.
ARTICLE XI -ASSIGNMENT AND SUBLETTING
10.1 CONSENT REQUIRED. Tenant may not assign this Lease
and/or sublet the Demised Premises, or any part thereof.
ARTICLE ~ -TENANT'S DEFAULT
11.1 EVENTS OF DEFAULT. The following events shall be deemed
to be events of default by Tenant under this Lease:
(a) Tenant shall fail to pay when due any payments or other
charges provided herein, or any portion thereof and the same
shall remain unpaid for a period of ten (10) days after the same
has become due; or
(b) Tenant shall do or permit to be done anything which creates a
lien upon the Demised Premises; and does not cause said hen
to be released within ten (10) days after written notice from
Landlord; or
(c) Any representation or warranty made in writing to Landlord in
this Lease or in connection with the making of this Lease, by
Tenant or any guarantor, shall prove at any time to have been
incorrect in any material respect when made or becomes
incorrect; or
(d) Tenant shall have failed to comply with any other provisions of
this Lease and shall not cure any failure within thirty (30) days,
or such longer period of time as may be reasonably required to
cure such default, after Landlord, by written notice, has
informed Tenant of such noncompliance.
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11.2 LANDLORD'S REMEDIES. Upon the occurrence of any of the
above events of default, Landlord may elect to either (1) terminate this
Lease; or (2) terminate Tenant's right to possession only without
terminating this Lease, hereinafter referred to as re-entry; (3) pursue any
other remedy available at law or in equity. Landlord shall have all
remedies provided in the Lease and under governing law. All of the
remedies given to Landlord in this Lease or by law shall be cumulative,
and the exercise of one right or remedy by landlord shall not impair its
right to exercise any other right or remedy.
11.3 COSTS, EXPENSES AND ATTORNEYS FEES. If one party is
required to seek legal counsel for collection or to commence litigation or
arbitration in order to enforce the covenants and agreements in this Lease,
the party prevailing in such collection, litigation or arbitration shall have
the right to reimbursement from the other party of all reasonable costs,
expenses and attorney's fees.
ARTICLE XII -- LANDLORD DEFAULT
12.1 DEFAULT NOTICE TO LANDLORD. Should Landlord default
in the performance of any of the covenants on the part of the Landlord to
be kept or performed and such default shall continue for thirty (30) days
after written notice to Landlord from Tenant specifying such default, or
should any warranty or representation made by Landlord be untrue and
remain untrue after thirty (30) days after written notice from Tenant
specifying such untruth, then and only in such event, shall termination of
this Lease be effected or action taken or remedy pursued. If the default or
untruth is of such character so as to require more than thirty (30) days to
remedy, the Landlord shall have a reasonable period in which to remedy
the same, provided Landlord is proceeding diligently.
ARTICLE XIII -MISCELLANEOUS PROVISIONS
13.1 COVENANT OF QUIET ENJOYMENT. Tenant, subject to the
terms and provisions of this Lease, on payment of the rent and observing,
keeping and performing all of the terms and provisions of this Lease on its
part to be observed, kept and performed, shall lawfully, peaceably and
quietly have, hold occupy and enjoy the Demised Premises during the term
hereof without hindrance or objection by any persons lawfully claiming
under Landlord.
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13.2 ENTIRE AGREEMENT. This Lease is executed in identical
counterparts, each of which, when bearing original initials of the parties on
each page and at each change in the text hereof as well as original
signatures at the end of each document, shall constitute an original for all
purposes. All previous agreements, whether oral or written, are
superseded by and merged with this Lease. Subsequent change shall not
be binding unless reduced to writing and signed by the parties hereto.
13.3 INVALIDATION OF PARTICULAR PROVISIONS. If any clause,
term or provision of this Lease, or the application thereof to any person or
circumstance shall to any extent, be invalid or unenforceable, the
remainder of this Lease, or the application of such term or provision to
persons or circumstances other than those as to which it is held invalid or
unenforceable, shall not be affected thereby, and each term and provision
of this Lease shall be valid and be enforced to the fullest extent permitted
by law. It is the intention of the parties hereto that in lieu of each clause,
term or provision of this Lease that is illegal invalid or unenforceable, there
be added as part of this Lease a clause, term or provision similar to such
illegal invalid or unenforceable clause, term or provision as may be
possible and would be legal valid and enforceable.
13.4 PROVISIONS BINDING, ETC. Except as herein otherwise
expressly provided, the terms hereof shall be binding upon and shall inure
to the benefit of the heirs, successors, assigns and legally appointed
representative, respectively, of Landlord and the Tenant. Each term and
each provision of this Lease to be performed by Tenant shall be construed
to be both a covenant and a condition.
13.5 RELOCATION BENEFITS AND ASSISTANCE. Tenant
acknowledges that the right to occupy the Demised Premises at a nominal
rent during the term of this Lease is an accommodation made by Landlord
pending the construction of Tenants new building on adjacent property. In
light of such accommodation, the Tenant releases the Landlord from any
claim which the Tenant may have for relocation benefits or relocation
assistance at the conclusion of this Lease.
13.6 NOTICES. Any notice which is required under this Lease shall
be deemed "given" upon hand delivery or three (3) days after prepaid
posting in the U. S. Mail whichever shall first occur. Notice shall be
addressed to the addresses listed at the beginning of this Lease or to any
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