City of Hopkin & School District Lease Agreement for the Center of the Arts June 27, 2007 C.R. \ t Y O
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• 6/27/07 y° P K��� Council Report 2007-055
City of Hopkins & Hopkins School District Lease Agreement
For the Hopkins Center for the Arts
Proposed Action
Staff recommends adoption of the following motion: Move to approve the lease
aqreement between Hopkins School District 270 and the Citv of Hopkins for the leasinq
of the Hopkins Center for the Arts.
Overview
The Hopkins School District has been a major tenant of the Hopkins Center for the Arts
since the facility opened in 1997. The District uses the facility for the purposes of artistic
and cultural appreciation and education; student and staff training and assembly; and
parent and community uses related to educational events and programs. The original
lease signed with Hopkins Schools had a 10-year term and so it is now time to enter
into a new lease. The lease is an asset to the Arts Center as it relates to the mission of
providing arts to the community and from a financial perspective of securing.a stable
major tenant. The City and Hopkins School wish to continue this relationship by signing
another 10-year lease. Attached you will find a copy of the Hopkins Center for the Arts
• City/School District lease for Council approval.
Primarv Issues to Consider
• Does this lease meet the needs of the Arts Center and Community?
• Does the lease meet the needs of the School District?
• Are there any major changes in this lease that differ from the previous lease?
Supportinq Information
• City of Hopkins & Hopkins School District 270 Lease Agreement for Hopkins
Center for the Arts
�
J . Strachota
Facilities Director
Financial Impact: $100,000/vr Budgeted: Y/N Source:
Related Documents (CIP, ERP, etc.):
• Notes: $100 000/year in lease revenue 10 vear lease term
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Council Report 2007-055
Page 2
•
Does this lease meet the needs of the Arts Center and Community?
This lease provides the Arts Center with a stable tenant who is a proven partner with
the city and community. The lease provides the flexibility needed to further develop
relationships with community groups, individuals, and business users, to utilize the
facility in a way that showcases the Arts Center as a community focal point, while
sustaining the financial integrity of the facility.
As a result of this lease community members are able to take advantage of School
District sponsored educational opportunities at the Arts Center. These activities range
from arts classes to parenting lectures, orchestra competitions to yoga classes and
student visual arts exhibits. The use of the Art Center for these types of activities has
grown over the past ten years and continues to grow.
Does the lease meet the needs of the School District?
The Hopkins School Board approved this lease on June 14, 2007.
Are there any malor chanqes in this lease that differ from the previous lease?
The new lease differs very little from the previous lease. Neither the City nor School
District staff members found any need to make substantial changes to the lease. The
amount of hours and space committed remain the same, the rent increases, and the
• only operational change to the lease was to rewrite the meet and confer section to more
accurately reflect how the process of allocating time and space is currently facilitated.
Attorneys from both the City and the School District have reviewed the documents and
staff has followed their recommendations in arriving at the attached final lease
document.
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• LEASE AGREEMENT BETWEEN
THE CITY OF HOPKINS AND
INDEPENDENT SCHOOL DISTRICT NO. 270
FOR THE HOPKINS CENTER FOR THE ARTS
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• TABLE OF CONTENTS
Pa�e
l. Leased Premises 1
2. Leased Services 1
3. Use of Premises 1
4. Term of this Lease 1
5. Exclusive Use Times 2
6. Additional Hours Usage by Tenant 2
7. Landlord's Priority on Additional Hours 2
8. Allocation of Additional Hours
through Meet and Confer Process 3
9. Shared Use of Building 4
10. Rent 4
11. Leasehold Improvements 4
12. Landlord's Covenants 5
13. Tenant's Covenants 5
14. Landlord's and Tenant's Scope of Liability 6
15. Partial Destruction of Premises 7
16. Breach of Covenants 8
17: Termination of Lease _ 9
• 18. Common Spaces 9
19. Interpretation and Amendment 9
20. Real Estate Taxes 10
21. Compliance with Minn. Statute Sec. 16A.695 - 10
22. Sale of the Building 11
23. Non-Approval/Appropriation 11
24. Compatible Tenant Clause 11
25. RenewalOption 11
26. Representation on Operations Board 12
27. Release of Spaces by Tenant;
Tenant's Executive Contact Person 12
28. Hazardous Substances/Environmental Regulations . 12 �
29. Estoppel Certificates 14
30. Subordination 14
31. Notices 14
Signature Page
Pa�e of First Reference
E�iibits A: Exclusive Use Times and Spaces 2
B: Leased Spaces Floor Plan 2
C: Criteria for Scheduling Conflict Resolution 3
• D: State Grant Agreement Excerpt: Sec. 2.03 10
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LEASE AGREEMENT BETWEEN THE
CITY OF HOPHINS AND
HOPHINS PUBLIC SCHOOLS
FOR THE HOPKINS CENTER FOR THE ARTS
THIS LEASE AGREEMENT (the "Lease") is executed in multiple originals this 14th day of
June 2007, by and between the City of Hopkins, referred to as the "Landlord", and Independent
School District No. 270, referred to as the "Tenant".
1. Leased Premises The Landlord in consideration of the rents and covenants stated in this
Lease to be paid and performed by Tenant, does lease to the Tenant and the Tenant does
lease from the Landlord the premises within the Hopkins Center for the Arts facility (the
"Building") at 1111 Mainstreet, Hopkins, Minnesota, and further described herein. The
premises covered by this Lease are limited to those portions of the Building to be leased to
Tenant pursuant to Paragraphs 5 and 6 of this Lease and are referred to herein as the "leased
premises" or the "premises".
• 2. Leased Services. The Landlord shall provide facility management staff and janitorial services
as follows:
o Daily cleaning and removal of refuse from spaces allocated by this Lease for use by
Tenant;
o Management of "Meet and Confer" process (see Section on Allocation of Additional
Hours, below)
o Maintenance and repair of fixtures and leasehold improvements including replacement of
light bulbs within spaces allocated by this Lease for use by Tenant.
3. Use of Premises. The leased premises shall be used by the Tenant for the purposes of artistic
and cultural appreciation and education; student and staff training and assembly; and parent
and community uses related to educational events and programs. .
4. Term of this Lease. The Tenant shall have full right to have and to hold the leased premises
for a term of ten (10) years, commencing the first day of November, 2007, and ending on the
thirty first day of October, 2017 (herein called the `Term") upon the rentals and subject to the
conditions set forth in this Lease. Subject to the terms and conditions of this Lease, Landlord
leases to Tenant and Tenant leases from Landlord the leased premises as defined herein, but
only for the dates and times specified herein, together with the right to use in common with
the Other Users and Landlord the common areas of the Building, the shared use areas of the
• Building, and all rights and easements appurtenant to the Building including the lobby, rest
rooms, hallways and un-designated parking areas.
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. The Landlord may terminate this Lease if the Tenant's uses of the premises are not consistent
with Tenant's uses per section 3 of this Lease. Such termination shall be upon four weeks'
written notice to Tenant and shall be valid only with Hopkins City Council action.
5. Exclusive Use Times. The Tenant shall be entitled to the exclusive use and possession of the
Art Classroom as described in Exhibit A(Exclusive Use Times and Spaces) and as depicted
on Exhibit B(Leased Spaces Floor Plan) to this Lease. Tenant's exclusive use of the Art
Classroom shall be subject to the Additional Hours in the Art Classroom allocated to
. Hopkins Center for the Arts, Inc. ("HCA") as described in Exhibit A hereto; provided that
Tenant's exclusive use has priority subject to the Meet and Confer process for consideration
of Additional Hours allocated to HCA.
6. Additional Hours Usa�e bv Tenant. In addition to Tenant's use and possession of the Art
Classroom as specified above, Tenant shall be entitled to the exclusive use and possession of
the following spaces (which spaces are identified in Exhibit B) for the number of "Additional
Hours" stated below per Activity Year, which is defined as August 1 through July 31 of each
calendar year during the Term. The dates and times on which Tenant shall be entitled to such
Additional Hours usage of the spaces identified herein shall be determined by the "Meet and
Confer" procedure described in Section 8 below (Allocation of Available Usage Dates). For
tlie purposes hereof, the "all day" use of a space shall be deemed to be for sixteen (16) hours.
• Additional Hours Approximate Number
Space per Activity Year of Weeks
Gallery 1,344 12
Rehearsal/Community Room 1,344 12
Dance Studio 2,900 26
Multi-Use —
Performance Hall 1,000 9
Theater: House, Upper House
Stage, Green Room, Make-up
Room, Dressing rooms 1,344 12
Conference Room 312 2+
7. Landlord's Priority on Additional Hours. Landlord shall have the Additional Hours for the
spaces described below in this Section 7, and shall have priority over Tenant and all other
tenants in scheduling said Additional Hours in the Meet and Confer process described below.
Landlord's Additional Hours are:
Space Additional Hours per Activity Year
Theater 146 hours
Rehearsal/Community Room 206 hours
Multi-Use Performance Hall 380 hours
• Dance Studio 254 hours
Arts Classroom 100 hours
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� 8. Allocation of Additional Hours Throu�h Meet and Confer Process. Scheduling of Additional
Hours on available usage dates (which refer to those dates that have not been requested as
exclusive use spaces by any of the tenants) for spaces within the Hopkins Center for the Arts
will be accomplished through a Meet and Confer process involving the major tenants (Stages
Theatre
Company, Hopkins Center for the Arts, Inc., and Tenant) and Landlord. The Tenant agrees to
participate in this process beginning in December of each year as described below for the
upcoming Activity Year.
The Tenant agrees to submit to the Landlord by December 1 of each year a preliminary
schedule of Tenant's activities in the Building for the upcoming Activity Year. The Landlord
shall prepare a compilation of all tenant and Landlord activity requests onto one "Activity
Year Meet and Confer Calendar" for each space (theater, community room, multi-use
performance hall, dance studio, art classroom, gallery, conference room), noting conflicts or
overlapping requests.
The Meet and Confer process will then begin with a meeting of a representative(s) from each
tenant group as well as Landlord representative(s), in a joint meeting. The Activity Year
Meet and Confer Calendars will be reviewed and conflicts or overlapping requests for space
will be resolved at the Meet and Confer meeting. It may take more than one meeting to
completely resolve the Activity Year schedule for all the participants. The Meet and Confer
• meeting(s) will take place during the month of December. A final Activity Year schedule
(each is a"Final Activity Year Schedule"), which will consist of the final Activity Year Meet
and Confer Calendars, will be distributed to the tenants no later than January 31for the
upcoming Activity Year. Once the Final Activity Year Schedule is distributed to tenants and
the Landlord, the balance of unscheduled space in the Building will be available on a first
come, first served basis, up to each tenant's limit of Additional Hours within each space.
The annual Meet and Confer meeting may also involve scheduling by mutual agreement any
events for Activity Years farther in the future than then current Activity Year. The agenda of
each Meet and Confer meeting may include specification by each tenant of such tenant's
activities during such tenant's respective exclusive use times and Additional Hours, as well
as discussion of logistical issues related to shared use of the Building, including parking,
kitchen use, foot traffic in lobby and halls, noise, etc.
At the Meet and Confer meeting, Landlord, Tenant, and the other tenants (excluding
. occasional users) shall confer and attempt to resolve all conflicts regarding the allocation of
Available Usage Dates. In doing so, the criteria listed in Exhibit C("Criteria for Schedule
Conflict Resolution") to this Lease shall be applied in resolving conflicts between tenants as
to the allocation of Available Usage Dates. Any conflicts regarding the allocation of
Available Usage Dates which are not resolved at the Meet and Confer meeting shall be
finally determined by Landlord applying the criteria listed in Exhibit C, and Landlord's
determination shall be final and binding on the Tenant and all other tenants in the Building.
� Tenant agrees that at any time the Landlord may request Tenant in writing to release Spaces
from Exclusive Use Times reserved pursuant to this Lease. Tenant shall consider each such
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• request; provided, however, under no circumstances shall Tenant be obligated to release any
spaces from Exclusive Use Times reserved pursuant to this Lease.
9. Shared Use of Buildin�. Landlord and Tenant acknowledge that Landlord has entered into a
lease agreement with Stages Theatre Company (formally Childs Play Theatre Company), and
a programming agreement with Hopkins Center for the Arts, Inc. pursuant to which Stages
Theatre Company and Hopkins Center for the Arts, Inc shall be entitled to certain Exclusive
Use Spaces, Exclusive Use Times, and Additional Hours Usage for the Spaces identified in
Exhibit A and Exhibit B.
Tenant acknowledges that, except as stated herein, Tenant shall not be entitled to the use and .
possession of spaces reserved to Landlord or leased to other tenants, and Tenant agrees the
other tenants of the Building shall be entitled to the exclusive use of such spaces for the
Exclusive Use Times stated in this Lease and the exhibits hereto.
10. Rent. Tenant agrees to pay the Landlord as gross rent (herein called "Rent") for the leased
premises and the leased services for the duration stipulated herein, without notice, set-off or
demand the annual sum of one hundred thousand dollars and no cents ($100,000.00) at a
monthly rate of eight thousand three hundred thirty three dollars and thirty three cents
($8,333.33). Under this paragraph, the monthly rent shall be due and payable in advance
• from Tenant to Landlord beginning on November 1, 2007 and ending on but including the
first day of October, 2017.
Monthly rental payments are to be due and payable by Tenant in advance at the office of the
Landlord as set forth in this Lease or at such other place as Landlord may designate in
writing. Monthly rental payment shall be due and payable on or before the first day of each
calendar month during the duration of this Lease or any extension or renewal hereof.
Landlord and Tenant agree that Tenant may pre-pay rent in full monthly increments at
Tenant's discretion, and that Tenant may request of Landlord at any time a statement of
account showing the amount and period of such pre-payments. All pre-payments shall be
applied to the time periods specified by Tenant at Tenant's sole discretion.
11. Leasehold Improvements. Tenant agrees to make no leasehold improvements or alterations in
the premises or the Building without first obtaining Landlord's written consent, which will
not be unreasonably withheld or delayed. All improvements such as fire-rated carpeting and
air conditioning which are affixed to the premises or the Building shall remain and become
the property of the Landlord in the event of lease termination. Except as otherwise stated in
this Lease, the Landlord shall not be required to make any alteration or improvement to the
leased premises.
•
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• 12. Landlord's Covenants. The Landlord hereby covenants and agrees as follows:
a. To furnish all necessary utilities for the proper functioning of the Building, including
heat, electricity, air conditioning, water and sewer and to keep same in good repair.
b. To provide custodial, maintenance and repair services for the leased premises and
common areas, including ice and snow removal in accordance with Landlord's snow
removal schedule.
c. To enter the leased premises only at reasonable times and with minimal disruption for the
purposes of inspection and to repair and correct all structural or other defects in the
premises and equipment, fixtures, or appliances serving same.
d. To maintain the Building's normal operating hours of 7:00 a.m. to 11 p.m. Monday
through Sunday.
e. To maintain the exterior and interior structural and functional components of the Building
and the Building grounds in good working order and repair;
• 13. Tenant's Covenants. The Tenant hereby covenants and agrees as follows:
a. Not to use or permit any activity upon the premises that will be dangerous to life, limb, or
property. In addition, Tenant agrees to implement policies and procedures to reasonably
ensure that students and adults follow traffic regulations and safe driving practices when
arriving at or departing the premises.
b. To provide a certificate of insurance covering its exposure to liability per this Lease.
c. Not to deface or injure, nor allow to be defaced or injured, the leased premises or any part
of the Building and grounds; not to overload the floors, nor to fill rooms with students or
adults beyond the legal capacity' of said rooms; not to create nor allow to be created any
nuisance in the Building or on the grounds thereof.
d. Not to erect nor allow to be erected within or on the exterior of the Building or on its
grounds any sign without the prior written consent of the Landlord. Such consent shall
not be unreasonably withheld or delayed.
e. Not to sublet the premises or any part thereof, nor to assign this Lease or any interest
herein, nor to permit this Lease to be transferred by operation of law or otherwise without
obtaining the prior written consent of the Landlord.
• f. Not to waste nor to misuse water, electricity, heat, or any of the other utilities or services
that shall be furnished by the Landlord.
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•
g. To notify Landlord promptly upon taking possession of or first using the premises or any
equipment, plumbing, fixtures, appliances and machinery therein of any defects in same,
or promptly following discovery of such defects if not discovered upon taking possession
or upon first use, except for such defects not reasonably susceptible to discovery upon
taking possession or upon first use of premises. Subject to the foregoing, such taking
possession of and use of the premises shall be conclusive evidence of the satisfactory
condition of the premises and the equipment and other services servicing same.
h. To quit and deliver up the premises to Landlord peaceably and quietly at the end of the
duration of this Lease or any previous termination of same for any cause in as good order
and condition and state of repair, wear and tear excepted, as the same are at the
commencement of the term of this Lease, and to remove all of Tenant's personal property
and debris therefrom.
i. To arrange with Stages Theatre Company, on such terms as may be acceptable to Tenant
and to Stages Theatre Company, for the use and operation of Stages Theatre Company's
theater equipment and such related equipment of Landlord when use of said equipment is
required for Tenant's activities in the Theater and the Multi-Use Performance Hall.
j. To comply with all state, federal, and municipal statutes, laws, ordinances and regulations
. and such reasonable rules and regulations as adopted by Landlord for the Building.
14. Landlord's and Tenant's Score of Liabilitv. Tenant agrees that it shall purchase in advance
and carry the following insurance at its own expense: a) "All Risk" fire and extended
coverage insurance insuring Tenant's personal property, furniture, trade fixtures, inventory
and business records against loss from all insurable events for the full replacement value
thereof, b) insurance against interruption of Tenant's business activities; c) comprehensive
general public liability insurance, providing coverage on an "occurrence and not a"claims
made" basis, covering all acts of Tenant, its employees, agents, representatives and guests
and insuring against all claims arising from injury to persons or damage to property in or
about the leased premises or the Building in a single limit amount of not less than
$2,000.000.00 for personal injury or death and not less than $500,000.00 for property
damage and fire legal liability.
All such insurance shall name Landlord as an additional insured and shall provide for ten
(10) days written notice to Landlord prior to cancellation, non-renewal or material
modification. Certificates of all such insurance shall be delivered to Landlord prior to
occupancy of the leased premises by Tenant and at least ten (10) days prior to the termination
date of any existing policy. Tenant shall pay to Landlord, upon demand, as additional rent the
cost of securing such insurance in the event Tenant fails to furnish certificates of insurance to
Landlord. However, it is not Landlord's duty nor obligation to secure such insurance for
• Tenant.
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• Landlord shall, during the Term of this Lease, maintain standard, all risk insurance on the
Building, including any fixtures which are the property of Landlord and including any
improvements to the leased premises which shall become the property of Landlord upon
termination of this Lease, insuring against loss by fire and other perils covered by a standard
extended coverage endorsement. Such insurance shall be in an amount of not less than the
full replacement cost of the Building. Landlord shall maintain, during the Term of this Lease,
comprehensive general public liability insurance covering the legal liability of Landlord
against claims for bodily injury, death or property damage occurring on or about the Building
in a single limit amount of not less than $2,000,000.00 for personal injury or death and not
less than $500,000.00 for property damage. With respect to all comprehensive general public
liability insurance maintained by Landlord and any other tenants of the Building (other than
the occasional users), Tenant hereunder shall be named as an additional insured there under
and shall be entitled to at least ten (10) days written notice prior to any termination,
cancellation, non-renewal or material modification thereof. The requirements of this section
relating to insurance to be maintained by Landlord shall be subject to the requirements of any
mortgage or loan agreement to which Landlord is subject, and the terms of any such
mortgage or loan agreement shall control the provisions of this section.
Landlord shall not be responsible or liable to the Tenant for any injury or damage resulting
from acts or omissions of third persons occupying property adjoining the leased premises or
any part of the Building of which the leased premises is a part, nor for any injury or damage
• to the Tenant or its property resulting from bursting, stoppage or leaking of water, gas, sewer
or steam pipes, except where such injury or damage arises from the willful or negligent
misconduct of the Landlord, its agents or employees or from the Landlord's failure to make
the repairs which it is obligated to make hereunder.
15. Partial Destruction of Premises. Landlord and Tenant agree that if during the duration of this
Lease the leased premises or the improvements thereon should be injured or destroyed by fire
or the elements, or through any other cause, so as to render the leased premises unfit for
occupancy, or to make it impossible to conduct the business of the Tenant thereon, or to such
an extent that the premises cannot be repaired with reasonable diligence within ninety (90)
days from the date of such injury, then the Landlord or Tenant may terminate this Lease as of
the date of such damage or destruction. The Tenant shall then immediately, or as soon as
practical thereafter, surrender the leased premises and all interest therein to the Landlord. The
Tenant shall pay rent only to the time of surrender; and rent pre-paid by Tenant which is
attributable to any period of time after the time of surrender shall be rebated to Tenant. If the
Lease is terminated as provided in the previous sentence, then Landlord may reenter and
repossess the leased premises described in this Lease, and may dispossess all parties then in
possession thereof. But if the leased premises can be restored within ninety (90) days from
the date of the injury thereto, and the Landlord within fifteen (15) days from the occurrence
of such injury elects in writing to so repair or restore said premises within ninety (90) days
from the date of the injury thereto, then this Lease shall not end or terminate on account of
• such injury by fire or otherwise. In such event the rent shall not run or accrue from the date
of such injury through the date of completion of such repairs, except that the Tenant shall
during such time pay a pro rata portion of such rent apportioned to the portion of the leased
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� premises which are in a condition fit for occupancy or which may be actually occupied
during such repairing period. If, however, the leased premises shall be so slightly injured by
any cause aforesaid as not to be rendered unfit for occupancy, then the Landlord shall repair
the same with reasonable promptness, and in that case the rent shall not cease or be abated
during such repairing period. All improvements placed by the Tenant on the leased premises
shall, in any event, be repaired and replaced by the Tenant at its option at its own expense
and not at the expense of the Landlord. If the Landlord shall fail to make the required repairs,
the Tenant may, at its option, terminate this Lease as of the date of such injury upon
furnishing written notice to the Landlord. Such right to terminate by the Tenant shall exist
from and after sixty (60) days from the date of injury if no notice of repair has been received
or from ninety (90) days of date of injury should notice have been received; in either event,
the repairs must not have been substantially completed.
16. Breach of Covenants. In the event of the breach by either party of a material covenant of this
Lease and if said breach is not corrected within thirty (30) days after written notice to the
other party of said breach, then the non-breaching party may at its election terminate this
Lease upon written notice, provided neither party may terminate this Lease so long as the
other party is proceeding with reasonable diligence to cure any default by such other party.
The Tenant shall be deemed to be in breach of this Lease if the Tenant's leasehold interest
shall be taken on execution or other process of law, or if the Tenant shall petition to be or be
declared bankrupt or insolvent according to law, or if the Tenant shall vacate said premises or
• abandon same during the duration of this Lease.
In the event a breach of this Lease is not corrected within thirty (30) days after written notice
to Tenant as provided above, the Landlord may at its election and upon written notice to the
Tenant as above provided declare this Lease forfeited and void, and may thereupon re-enter
and take full and absolute possession of said premises as the owner thereof, and free from
any right or claim of the Tenant, or any person or persons claiming through or under the
Tenant; and such election and reentry last mentioned shall be and constitute an absolute bar
to any right to enter by the Tenant upon the payment of all arrearages of rent and costs after a
disposition under any suit or process for breach of any of the covenants of this Lease, and the
commencement by the Landlord of any action to recover possession of aforesaid premises
shall be deemed a sufficient notice of election of said Landlord to treat this Lease as void and
terminated, without the written notice above specified in this subparagraph.
Tenant agrees that it will look solely to the interest of Landlord in the Building and the
rentals therefrom for the collection of any judgment or award requiring the payment of
money by Landlord in the event of any default by Landlord in any of the terms, covenants or
conditions of this Lease; and no other assets of Landlord shall be subject to levy, execution
or other legal process for the payment of Tenant's claims.
Re-entry by the Landlord and declaration of forfeiture shall not work a forfeiture of the rents
• to be paid and the covenant to be kept by Tenant for the full term of this Lease, except that
Landlord shall make a good faith and reasonable effort to re-let the leased premises and any
monies received therefrom shall be applied to Tenant's rent obligations, provided that the
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� reasonable expenses incurred by the Landlord in any such re-letting may be deducted from
any monies received therefrom.
If an event of default shall have occurred and Landlord places in the hands of an attorney the
enforcement of all or any of the terms, covenants, agreements or conditions of this Lease, the
collection of any rent due or to become due, or the recovery of possession of the leased
premises, Tenant agrees to reimburse Landlord, as additional rent hereunder, for Landlord's
r.easonable attorney's fees, together with the actual cost of maintaining any action
commenced in law or equity by Landlord, whether suit is actually filed or not. .
If an event of default shall have occurred and Tenant places in the hands of an attorney the
enforcement of all or any of the terms, covenants, agreements or conditions of this Lease,
Landlord agrees to reimburse Tenant for Tenant's reasonable attorney's fees, together with
the actual cost of maintaining any action commenced in law or equity by Tenant, whether
suit is actually filed or not.
Other remedies for non-payment of rent notwithstanding and without prejudice to such
remedies, if Tenant fails to pay the Rent or any other payment due hereunder, within thirty (30)
days following written notice of default by Landlord, Tenant shall pay to Landlord, as
additional rent hereunder, interest on all such past due payments at the rate of one percent
(1 %) per month or at the maximum rate permitted by law, whichever rate is lower. Interest
� shall accrue from the date each such late payment became due and shall be payable to the date
of payment thereof by Tenant.
17. Termination of Lease. Tenant and Landlord agree to give the other party written notice two
(2) months prior to the expiration of this Lease, or any extension by option thereof, of its
intention to vacate the premises or to demand vacation of the premises. Unless either party
gives notice that the premises shall be vacated at the end of the lease term, or any extension
by option thereof, this Lease shall be extended for successive one-month periods
commencing as of the date of the end of the Lease, or any extension by option thereof, and
continuing until October 31, 2018. Monthly rent payable during such period shall be twelve
thousand dollars and zero cents ($12,000.00).
If Landlord has previously given notice of termination, and if for any reason the Tenant does
not promptly vacate the premises at the end of the term, or any extension by option thereof,
then the Tenant agrees to pay the Landlord for such time as elapses between the end of the
term of this Lease as same may be extended by this provision of the agreement and the time
when the Tenant actually vacates the premises, a pro rata amount based on a monthly rent of
twelve thousand dollars and zero cents ($12,000.00).
18. Common Spaces. Tenant shall have access to and the use of all common spaces throughout
the Building that are not leased to other tenants, such as, but not limited to, rest rooms,
� elevators, stairs, and corridors for the term of this Lease and any extension hereo£
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• 19. Interpretation and Amendment. The terms of this Lease shall be interpreted in accordance
with the laws of the State of Minnesota. The parties agree that no assent, express or implied,
by the Tenant or the Landlord to any breach of any of the covenants or agreements contained
herein shall be deemed or taken to be a waiver of any succeeding breach of such covenant.
This Lease is binding on the parties hereto and their successors in interest and it contains the
complete agreement of the parties. This Lease can only be amended in writing signed by both
parties.
20. Real Estate Taxes. If the current tax exempt status on the Building changes due to the
Tenant's occupancy, the Tenant shall pay all real estate taxes on said property and all
payments required to be made in lieu of taxes, including payments required by M. S. 272.68,
Subd. 3, and shall pay any expenses incurred in connection with such obligation, but only as
such taxes and expenses are attributable to Tenant's occupancy.
21. Compliance with Minnesota Statutes Section 16A.695. The parties hereto agree that
notwithstanding any other provision of this Lease, the following provisions shall apply:
a. Landlord covenants that it has the authority to enter into and execute this Lease
agreement under Minnesota Statutes, Sections 471.15 and 471.191 in order to carry out a
governmental program, which is community-based artistic and cultural performances and
education. The statutes cited state in part, "Any... city... or any board thereof... may
• operate a program of public recreation..." and, "Any city operating a program of public
recreation... may acquire... and maintain land, buildings, and other recreational facilities,
including, but without limitation...concert halls,...and facilities for...cultural participation,
contests, and exhibitions..."
The Landlord has specific statutory authority to expend monies to operate and maintain
the Building under Minnesota Statutes, Section 471 .191, which states, "Any city
operating a program of public recreation...pursuant to sections 471.15 and 471.19 may
acquire or lease, equip, and maintain land, buildings, and other recreational facilities,...
and may expend funds for the operation of such program and borrow and expend funds
for capital costs thereof pursuant to the provisions of this section."
b. Tenant's use of the leased premises hereunder shall constitute the "governmental
program" within the meaning of Minnesota Statutes, Section 16A.695 to be carried out
by Tenant from the leased premises.
c. Tenant agrees to provide Landlord with an initial program evaluation report, and with
annual budgets for the Tenant's program to be operated in the Building, showing program
revenues and expenses.
d. In the event Tenant terminates or changes the governmental program to be carried out by
• Tenant from the leased premises, Landlord may upon at least sixty (60) days written
notice to Tenant and opportunity to cure, and upon action by the Hopkins City Council at
a meeting of which Landlord shall have notified Tenant, terminate this Lease in
Doc# 2319260�2
• accordance with its terms. Tenant's use of the leased premises shall comply with the
requirements of Section 2.03 of the grant agreement entered into by Landlord with the
State of Minnesota, Department of Administration (a copy of Section 2.03 is attached
hereto as Exhibit D). �
e. The parties hereto agree that the employees, agents and representatives of Landlord and
of the State of Minnesota, including the Departments of Finance and Administration
thereof, shall have access to Tenant's Exclusive Use Spaces and the remainder of the
leased premises hereunder for the purpose of determining whether the governmental
program is being carried out by Tenant from the leased premises. The parties hereto agree
that they shall jointly and severally promptly supply upon request by the Minnesota
Departments of Finance or Administration any and all documentation and records, which
may by said state agencies be required for the purpose of providing state oversight of the
governmental program and of the state funds granted to the Landlord for construction of
the Building; provided that Tenant shall only be obligated to supply such documentation
and records as are in Tenant's possession; and that the parties hereto shall, upon direction
� from the Minnesota Commissioner of Finance, take such actions and furnish such
documents as the Commissioner determines to be necessary to ensure that the interest to
be paid on the general obligation bonds is exempt from federal taxation.
• 22. Sale of the Buildin�. Landlord and Tenant acknowledge that this Lease is free of any
provisions which would require the Landlord to sell the Building for an amount less than its
fair market value, that this Lease is free of any provisions which would require Landlord to
sell the Building without first obtaining the written consent of the Minnesota Commissioner
of Finance, that this Lease is free of any provisions that would cause the manner of
distribution of the proceeds of the sale of the Building to violate the provisions contained in
the General Obligation Compliance Bill and/or in the Order of the Minnesota Commissioner
of Finance, and that this Lease contains no sale or purchase option provisions. Landlord and
Tenant further represent to one another hereby that no such sale or purchase option
provisions as described in this paragraph exist in any agreement between the parties hereto,
including but not limited to this Lease. In the event of a sale of the Building this Lease shall
remain in effect.
23. Termination bv Tenant. The Tenant shall have the right to terminate this Lease effective as of
the end of each of Tenant's fiscal years. In order to exercise Tenant's right of termination in
this section, Tenant shall give written notice of termination no fewer than thirty (30) days
prior to the end of the fiscal year for which such termination shall be effective. It is the intent
of the Tenant to execute the term of this Lease as stipulated above in the section "Term of
this Lease."
24. Compatible Tenant Clause. The Landlord agrees to use good judgment and discretion in the
leasing of space within the Building and will not lease space to any individual, group,
• organization or business that is not compatible with the Tenant. Landlord acknowledges that
Tenant's primary use of the Building will involve visits to the Building by children, and
agrees not to lease space to another user that is not compatible with Tenant's uses.
Doc# 2319260�2
_ _
•
25. Renewal Option. Provided Tenant is not in default under this Lease either at the time notice
is given or at the expiration of the then current term of this Lease, Tenant shall have the right
and option, exercisable by giving Landlord written notice ("Notice of Extension") thereof at
least 90 days but no more than 360 days prior to the expiration of the then current term of
this Lease, to extend the term of this Lease for one period of one hundred nineteen (119)
months. Upon the giving of the Notice of Extension, the term of this Lease shall
automatically be extended as provided in the preceding sentence. The extended term of this
Lease shall be upon and subject to all of the terms, covenants, agreements, provisions and
conditions of this Lease, excluding, however, the rental amount. Landlord and Tenant agree
that, in the event Tenant extends this Lease per this section, Landlord and Tenant shall
negotiate a rental amount acceptable to both Landlord and Tenant.
In the event that Tenant extends this Lease per this section and Landlord and Tenant fail to
agree on a rental amount for the period of the extension of this Lease, then the monthly rental
amount shall be twelve thousand dollars and zero cents ($12,000).
In the event the Tenant fails to give notice of extension at the time and manner herein
provided, and subject to Section 17 of this Lease, this Lease shall automatically terminate as
of the end of the then current term, and Tenant shall have no further right or option to extend
this Lease. When used in this Lease, the phrase "term of this Lease" or similar phrases shall
• mean and refer to the original term of this Lease and the extended term thereof.
26. Representation on Operations Board. Landlord and Tenant acknowledge that the Building no
longer operates under rules and regulations established by a Center Operations Board (the
"Operations Board"). The Operations Board was an official board of the City of Hopkins and
an advisory body to the Hopkins City Council. In the event the City re-establishes an
Operations Board for the purposes stated above, the Landlord and Tenant acknowledge that
the Center Operations Board will have an odd number of inembers and that the Tenant may,
during the term of this Lease, appoint one member of the Center Operations Board as
Tenant's representative.
27. Release of Spaces by Tenant: Tenant's Executive Contact Person. Landlord and Tenant agree
that after Landlord delivers the Final Activity Schedule as provided above in Section 8, upon
request of Landlord, Tenant may elect (but shall not be obligated) to release to Landlord any
space for any date or time Tenant is entitled to use such space under the provisions of this
Lease. In that regard, Tenant agrees to collaborate with Landlord and other tenants to use the
Building to the fullest extent possible. Tenant agrees that Tenant's Superintendent of Schools
or designee shall be authorized to grant or deny any request for release of space under this
section.
Notwithstanding the above, Tenant shall be obligated to release any space other than the Art
• Classroom to Landlord under the following conditions: Landlord must give Tenant six
weeks' notice of a request for release of a specific space at a specific time; if Tenant after
receipt of such notice fails to specify to Landlord a Tenant activity at least 30 days prior to
Doc# 2319260�2
• the specific time for which a specific space is requested, then Tenant shall be deemed to have
released that specific space for that specific time for use by Landlord or by users other than
Tenant, and Landlord shall be entitled to retain all rent or other payments received for the use
of such space.
28. Hazardous Substances/Environmental Re�ulations. Tenant warrants and represents that:
a. Its use of the leased premises and the operation of its business and affairs thereon shall
not violate any law, statute, ordinance, rule, regulation, order or determination of any
governmental authority pertaining to hazardous substances, toxic waste, asbestos, health
or the environment (hereinafter sometimes collectively called "Environmental
Regulations") including, but not limited to, the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980 as amended by the Superfund Amendments and �
Reauthorization Act of 1986, and the Resource Conservation and Recovery Act of 1976
and the Minnesota Environmental Response and Liability Act;
b. Tenant will obtain prior to its commencement of activities in the Building and shall
continue to maintain all permits, licenses or similar authorizations, if any required by
Environmental Regulations to conduct its business on the leased premises and;
c. Tenant's use of the leased premises will not result in the disposal, discharge or release in
• violation of applicable Environmental Regulations of any hazardous substance, toxic
waste, asbestos or other substance ("Hazardous Substances") regulated by Environmental
Regulations on or about the leased premises or the Building.
In the event Tenant, its officers, agents, employees or subcontractors breach or fail to
perform any of the warranties and representations contained in this section:
d. Upon notice from Landlord, Tenant shall remove from the leased premises or the
Building, at Tenant's sole expense, any Hazardous Substance which is not in compliance
. with Environmental Regulations or this Lease to the extent that such Hazardous
Substance was the result of the acts of Tenant, its officers, agents, employees or
subcontractors.
e. Landlord and such environmental engineers or consultants as it may employ shall be
entitled to enter upon the leased premises upon reasonable prior notice for the purpose of
conducting such environmental audits or similar tests as Landlord may deem reasonably
necessary and the cost and expense of such environmental audits and or tests incurred by
Landlord shall be paid by Tenant as additional rent hereunder with the next installment of
Rent; provicled that Tenant shall have no obligation or expense to the extent that such
audit and/or test fails to reveal any material violations due to the acts of Tenant.
Landlord warrants and represents that prior to the date of occupancy by Tenant there shall
• have been no violations of Environmental Regulations, and that there shall be no
Hazardous Substances within the Building.
Doc# 2319260�2
� f. Landlord and Tenant shall protect, indemnify and hold the other party harmless from all
costs, fines, claims, demands, actions, proceedings, judgments and damages (including
court costs and reasonable attorneys' fees) resulting from or arising out of any breach or
nonperformance by Tenant or Landlord of the representations and warranties contained in
this Section including but not limited to the cost of removal and/or remediation of any
disposal, discharge, release or contamination of or by Hazardous Substances on or about
the leased premises, or the Building.
It is expressly acknowledged by Tenant and Landlord that all of the terms, covenants and
conditions of this section pertaining to Environmental Regulations including but not limited
to the indemnities herein provided shall survive the termination of this Lease.
29. Estoppel Certificates. Tenant agrees at any time and from time to time, but no more than two
(2) times per calendar year, upon not less than ten (10) days' prior written notice by
Landlord, to execute, acknowledge and deliver to Landlord or a party designated by Landlord
a statement in writing (i) certifying that this Lease is unmodified and in full force and effect,
or if there have been modifications, that this Lease is in full force and effect as modified and
stating the modifications, or if not in full force and effect stating the reasons and facts
thereto, (ii) stating the dates on which the Rent and other charges hereunder have been paid
by Tenant, (iii) stating, to the best of Tenant's knowledge, whether or not Landlord is in
default in the performance of any covenant, agreement or condition contained in this Lease,
� and, if so, specifying each such default, and (iv) such other matters relating to this Lease as
may reasonably be requested. Any such statement delivered pursuant hereto may be relied
upon by any owner of the Building, any prospective purchaser of the Building, any
mortgagee or prospective mortgagee of the Building or of Landlord's interest, or any
prospective assignee of any such mortgagee.
30. Subordination. Without the necessity of any additional document being executed by Tenant
for the purpose of effecting a subordination, this Lease shall be subject and subordinate at all
times to the lien of any mortgage which may now or hereafter encumber the Building or
Landlord's interest or estate therein; provided, however, that if the Landlord, any mortgagee
or holder of any mortgage elects to have Tenant's interest in this Lease be superior to any
such mortgage, then by notice to Tenant, this Lease shall be deemed superior, whether this
Lease was executed before or after said mortgage. Notwithstanding the foregoing, Tenant
covenants and agrees to execute and deliver within ten (10) days of written request therefore
any certificate or subordination agreement evincing such subordination or superiority of this
Lease as may be reasonably requested by Landlard or any mortgagee, provided, however,
that any subordination by Tenant, whether in accordance with this section or by separate
agreement, shall only be effective if Tenant has first received a non-disturbance agreement
from the mortgagee, by which the mortgagee shall agree not to disturb Tenant's possession
(provided Tenant is not in default under this Lease) and shall agree to honor the terms of this
Lease. Tenant further agrees that in the event that any proceedings are brought for the
• foreclosure of any mortgage, Tenant shall attorn to the purchaser at the foreclosure sale and
recognize such purchaser as the Landlord under this Lease, if requested to do so by such
purchaser, provided that said purchaser agrees that Tenant's possession of the leased
Doc# 2319260�2.
• premises shall not be disturbed so long as Tenant shall continue to perform all of the
covenants and conditions of this Lease, in which case Tenant's obligations to perform such
covenants and conditions shall not be in any way diminished thereby. Either party to this
Lease is permitted to record a memorandum of lease at its discretion.
31. Notices All notices or other communications hereunder shall be in writing and shall be hand
delivered or sent by first class United States Mail, postage prepaid, or by a nationally
recognized overnight delivery service, to the following address:
Landlard: City of Hopkins
Attention: City Manager
10101 First Street South
Hopkins, MN 55343
Tenant: Hopkins Public Schools
Attention: Community Education Director
1001 State Highway 7 .
Hopkins, MN 55343
If notice is given by mail or by overnight delivery service, such notice shall be deemed to
have been given on the day following the date of mailing.
• The Landlord and the Tenant have executed this Lease on the day and year first written, each
party retaining an executed copy for its records.
Tenant: Landlord: .
Independent School District No. 270 City of Hopkins
Hopkins Public Schools 1010 First Street South
1001 State Highway No. 7 Hopkins, MN 55343
Hopkins, MN 55305
By By
School Board Chairperson Its Mayor
BY BY
Superintendent of Schools City Manager
Date• Date•
•
Doc# 2319260�2
• EXHIBIT A
EXCLUSIVE USE TIMES AND SPACES
This Exhibit summarizes the rights to exclusive use of certain spaces, or certain spaces only
at certain times, of the three major tenants of the Building.
Exclusive Use Spaces
Stages Theatre Company will have exclusive, year-round use of the following spaces:
• Stages Theatre Company Offices, Scene Shop,
• Stages Theatre Company Storage Room, Costume Shop and Box Office
Exclusive Use Times
I. Tenant will have exclusive use of the Art Classroom year-round.
II. The Hopkins Center for the Arts, Inc will have exclusive use of the Gallery for 24
weeks to be specified and for an additional3 weekends to be specified.
The Hopkins Center for the Arts, Inc will have exclusive use of the Multi-Use
� Performance Hall for three weeks in March-April and three weeks in September to be
specified.
III. Stages Theatre Company will have exclusive use of the following spaces and times:
a. Space for preliminary rehearsals every day Monday thxough Friday from 3:00
p.m. to 10:00 p.m. and every Saturday from 8:00 a.m. to 5:00 p.m.
This space may be any one of the following spaces on a given day:
Priority
RehearsaUCommunity Room first
Dance Studio second
Theater third �
Multi-Use Performance Hall fourth
Landlord shall provide Stages Theatre Company with the highest priority space for
preliminary rehearsals on a given day as scheduling considerations permit.
Landlord may not provide Stages Theatre Company with a space for preliminary
rehearsals on a given day if that space is reserved for another user unless that user
releases that space in writing.
• b. The Theater for final rehearsals and performances as needed by Stages Theatre
Exhibit A
Page 1
• Company throughout its 36-week season, with runs planned as follows:
6 weeks during Sept. - Oct. 7 weeks during March-April
9 weeks during Nov. - Dec. 8 weeks during May-June
6 weeks during Jan. - Feb.
Stages Theatre Company will submit to Landlord each year an Activity Schedule
showing when its final rehearsals and performances will be. For any other times
during Stages Theatre Company 36-week season, other users may request that
Stages Theatre Company release theater time. To the extent that such requests do
not interfere with its core program of final rehearsals and performances, Stages
Theatre Company will accommodate such requests.
c. The Multi-Use Performance Hall for performances as follows:
8 weeks during Jan. - March
8 weeks during June - August, except for Tuesday, Wednesday and
Thursday of the week before the third weekend in July.
d. Conference Room for monthly board meetings in the evenings and weekly staff
meetings during the day.
•
�
Exhibit A
Page 1
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EXNIB{T 'B' ��cr �
� EXHIBIT D
SECTION 2.03 OF GRANT AGREEMENT
Section 2.03 Operation of the Facility. The Public Entity shall operate the Facility, or
cause it to be operated, as a center for arts and cultural performance and education, or for
such other use as the legislature may from time to time designate, and may enter into Use
Contracts with Lessees to so operate the Facility; provided that such contracts have been
approved, in writing, by the State Entity and the Finance Commissioner. The Public
Entity shall also annually determine that the Facility is being so used, and shall supply a
statement, sworn to before a notary public, to such effect to both the State Entity and the
Finance Commissioner.
With respect to any program which will be operated in the Facility, the Public Entity
covenants with, and represents and warrants to, the State Entity that (I) it has the ability
and a plan to fund the program which will be operated in the Facility, (ii) it demonstrated
such ability and supplied such plan to the State Entity prior to the execution of this
Agreement, and (iii) it will not enter into a Use Contract with a Lessee unless such
� Lessee has demonstrated to the State Entity that it has the ability and a plan to fund the
program which Lessee intends to operate in the Facility.
•