**EXHIBIT 10.5**

 

 

 

 

**Northern Star Bank**

 

**(Lessee)**

 

 

 

**Five Star Properties of St. Cloud,LLC**

 

**(Lessor)**

** **

** **

** **

 

 

----

 

 

**TABLE OFCONTENTS**

 
| **ARTICLE** |   |                                       |   |
|-------------|--------|--------------------------------------------|--------|
|        |   |                                       |   |
| 1.          |   | Basic  Lease Information                   |   |
| 2.          |   | Leases Premises                            |   |
| 3.          |   | Lease Term                                 |   |
| 4.          |   | Acceptance  of Premises                    |   |
| 5.          |   | Rent Payment                               |   |
| 6.          |   | Operating Costs                            |   |
| 7.          |   | Usable Area                                |   |
| 8.          |   | Use                                        |   |
| 9.          |   | Business Hours                             |   |
| 10.         |   | Repairs by Lessor                          |   |
| 11.         |   | Repairs by Lessee                          |   |
| 12.         |   | Alterations                                |   |
| 13.         |   | Termination                                |   |
| 14.         |   | Signs                                      |   |
| 15.         |   | Access                                     |   |
| 16.         |   | Utilities  and Services                    |   |
| 17.         |   | Assignment and Subletting                  |   |
| 18.         |   | Fire and Casualty                          |   |
| 19.         |   | Subrogation                                |   |
| 20.         |   | Liability                                  |   |
| 21.         |   | Insurance                                  |   |
| 22.         |   | Eminent Domain                             |   |
| 23.         |   | Holding Over                               |   |
| 24.         |   | Quiet Enjoyment                            |   |
| 25.         |   | Events of Default                          |   |
| 26.         |   | Default                                    |   |
| 27.         |   | Notification  in Event of Sale or Transfer |   |
| 28.         |   | Notices                                    |   |
| 29.         |   | Rules  and Regulations                     |   |
| 30.         |   | Governmental/Legal Action                  |   |
| 31.         |   | Light and Air                              |   |
| 32.         |   | Brokerage Fees                             |   |
| 33.         |   | Force Majeure                              |   |
| 34.         |   | Estoppel  Certificate                      |   |
| 35.         |   | Miscellaneous                              |   |
| 36.         |   | Invalidity of  Particular Provisions       |   |
| 37.         |   | Governing Law                              |   |
| 38.         |   | Right  of First Refusal                    |   |
| 39.         |   | Subject  to Approval                       |   |
|        |   | Signatures                                 |   |

 

 

2

----

 

**EXHIBITS**

 

 

 

| Leased Premises                   | A |
|-----------------------------------|---|
| Lessee Improvement  Agreement     | B |
| Building Rules &  Regulations | C |
| Signs                             | D |
| Legal Description                 | E |

 

 

**ADDENDUM**

 

 

 

| Option to Extend  | 1      |
|-------------------|--------|
|              |   |
| Additional Rent   | 2      |
|              |   |
| Training Room Use | 3      |

 

 

3

----

 

 

**LEASE AGREEMENT (“Lease”)**

 

 

This Lease, is made and entered into this 7thday of March 2001, by and between Lessor and Lessee as described in Article 1.Aand Article 1.B

 

**1.****                                     ****BASIC LEASEINFORMATION:**

The following basic leaseinformation is a part of this Lease, but does not constitute the entireLease.  Lessee acknowledges that it hasread all exhibits which are a part hereof and agrees that this Lease, includingthe basic lease information and all exhibits reflect the entire understandingand reasonable expectations of Lessor regarding the Premises.  Lessee also acknowledges that it has had theopportunity to review this Lease prior to execution with legal counsel and/orsuch other advisors as Lessee deems appropriate.

 

In addition to the termswhich are defined elsewhere in this Lease, the following defined terms are usedin this Lease.

 
| A.     |   | *Lessor*: |   | Five Star Properties of  St. Cloud, LLC |
|--------|--------|-----------|--------|-----------------------------------------|
|   |   |      |   | 300 East St. Germain  Street            |
|   |   |      |   | St. Cloud, MN 56304                     |
|   |   |      |   |                                    |
| B.     |   | *Lessee*: |   | Northern Star Bank                      |
|   |   |      |   | 300 East St. Germain  Street            |
|   |   |      |   | St. Cloud, MN 56304                     |

 

C.             *Leased Premises*: The UsableArea, as defined in Article 7, located within the Building consists ofapproximately 3,132 square feet as shown on Exhibit A to this Lease.

 

D.            *Building At*: The buildingwhich is located at  300 East St.Germain Street, St. Cloud, MN

 

E.*             **Lease Term*: 10 Years and0 Months, beginning on the Commencement Date, as defined in Article 1.F, andending on the Expiration Date, as defined in Article 1.G.  **See Addendum for additional terms.**

 

F.**             ***Commencement Date*: July 1, 2001 - additional daily rent forfailure to open on July 1, 2001 - 137.00 per day

 

G.             *Expiration Date*:                          June 30, 2011

 

H.            *Monthly Rent*:

 

Year 1 - the sum of $3,132 per mo., which equates to $12.00 per usablesf per year

Year 2 - the sum of $3,393 per mo., which equates to $13.00 per usablesf per year

Year 3 - the sum of $3,654 per mo., which equates to $14.00 per usablesf per year

Year 4 - the sum of $3,915 per mo., which equates to $15.00 per usablesf per year

Year 5 - the sum of $4,176 per mo., which equates to $16.00 per usablesf per year

Year 6-10 - the sum of $5,220 per mo., which equates to $20.00 per usablesf per year

Option 5 yr term - the sum of $5,742 per mo., which equates to $22.00per usable sf per year

 

plus a Pro Rata Share of any increase of real estate taxes on theProperty over and above the New Base Year real estate taxes as defined below.

 

4

----

 

 

I.                 *Lease Payment Address*:300 East St. Germain StreetSt. Cloud, MN 56304

 

J.**               ***Use*: For use asbank and general office.

 

K.            *Building Power Standards*: Electricaldistribution systems for power and lighting for the Leases Premises and specialelectrical systems are to be at least the same watts per square foot as of thedate this Lease is executed.

 

L.              *Property*: That certainparcel of land on which the Building is located situated in the County ofBenton State of MN, and legally described as follows: See Exhibit E - LegalDescription 

 

M.         *Lessor Notification Address*:300 East St. Germain StreetSt. Cloud, MN 56304

 

If any other provisions of this Lease contradicts any definition ofthis Article, the other provision will prevail.

 

The following exhibits are attached to this Lease and are made parts ofthis Lease:

 

Exhibit A - Leased Premises

Exhibit B - Lessee Improvement Agreement

Exhibit C - Building Rules and Regulations

Exhibit D - Signs

Exhibit E - Legal Description

Addendum

 

N.            *New Base Year*: Is the yearreal estate taxes payable reflecting the assessed value of the Propertyas of January 2, 2001.

 

O.            *Pro Rata Share*: Thepercentage obtained when the Usable Area of the Leased Premises is divided bythe total Usable Area of the Building. At the Commencement Date the Pro Rata Share is: 3,132 / 18,529 = 16.9%.

 

P.              *Parking*:  Lessor will provide seven designatedcustomer parking spots and up to six designated employee parking spots at nocharge.

 

 

5

----

 

 

**2.****                                     ****LEASEDPREMISES:**

In consideration of the obligation of Lessee to pay rent as hereinprovided, and in consideration of the other terms, provisions and covenantshereof, Lessor hereby demises and leases to Lessee, and Lessee hereby takesfrom Lessor, the Leased Premises as described in Article 1.C, which is locatedin the Building as described in Article 1.D, and on the Property described inArticle 1.L, together with all rights, privileges, easements, appurtenances andimmunities belonging to or in any way pertaining to the Leased Premises, andtogether with the right to use in common with Lessor and other lessees in theBuilding, and its and their employees, agents, representatives and invitees,any common areas and facilities of the Building.

 

 

**3.****                                     ****LEASE TERM:**

The Lease Term shall be as described in Article 1.E.

 

 

**4.****                                     ****ACCEPTANCEOF PREMISES:**

Lessee acknowledges that it has inspected the Leased Premises andaccepts it in its present condition as suitable for the purpose for which it isleased, and further acknowledges that no representations as to the repair ofthe Leased Premises nor

promises to alter, remodel or improve the Leased Premises have beenmade by Lessor, except as may be provided on Exhibit B attached hereto andincorporated herein.  In the event thereare leasehold improvements which are to be completed by Lessor, and Lessor doesnot complete leasehold improvements and deliver possession of the LeasedPremises on or before said Commencement Date, or if Lessor is unable forreasons beyond Lessor’s control to deliver possession of the Leased Premises bysuch date, Lessor shall not thereby be deemed to be in default hereunder, andshall not thereby be liable to Lessee for any loss, damage, cost and expense sufferedor incurred by Lessee, nor shall the Commencement Date of the Lease or theLease Term of the Lease be affected or changed thereby, and Lessee agrees toaccept possession of the Leased Premises at such time as Lessor is able totender the same; provided, however, that Lessor hereby waives payment ofMonthly Rent, as defined in Article 5, covering any period prior to thetendering of possession to Lessee hereunder, except as otherwise provided onExhibit B attached hereto.

 

If thirty (30) days after the Commencement Date the Lessor has notdelivered possession of the Leased Premises to the Lessee, the Lessee may, bygiving seven (7) days Notice, as defined in Article 28, cancel this Lease andall payments made by Lessee to Lessor will be refunded to the Lessee withinfive (5) days.

 

 

**5.****                                     ****RENTPAYMENT:**

Lessee shall pay to Lessor during the Lease Term a Monthly Rent asdescribed in Article 1.H, plus any Additional Rent as herein defined (sometimescollectively referred to as “Rent”) and as adjusted from time to time inaccordance with the provisions of this Lease, payable in advance on the firstday of each month during the Lease Term in lawful money of the United States toLessor at the Lease Payment Address as described in Article 1.I.  Additional Rent is hereby defined as, butnot limited to, charges for services above building standards and latecharges.  Appropriate adjustment ofLessee’s Additional Rent shall be made on the basis of actual cost, withoutmarkup, for disproportionate services (whether greater or lesser than standardservices) to Lessee or to other Lessees.

 

 

6

----

 

 

**6.****                                     ****OPERATINGCOST:**

Subject to Article 16, operating costs are included as part of MonthlyRent and will not be treated in any other fashion.

 

 

**7.****                                     ****USABLEAREA:**

Usable Area shall be determined by Building Owners and ManagersAssociation (“BOMA”) standards for measuring floor area in office buildings asfollows:

 

A.           The Usable Areaof an office shall be computed by measuring to the finished surface of theoffice side of corridor and other permanent walls, to the center of partitionsthat separate the office from adjoining Usable Areas, and to the insidefinished surface of the dominant portion of the permanent outer building walls.  No deductions shall be made for columns andprojections necessary to the building. The Usable Area of a floor shall be equal to the sum of all Usable Areason that floor.

 

 

**8.****                                     ****USE:**

The Leased Premises shall be used for the purpose as described inArticle 1.J.  No part of the LeasedPremises shall be used for any purpose which constitutes a nuisance or which isillegal, offensive, termed hazardous by insurance companies or which may makevoid or voidable any insurance on the Building or which may increase the premiumstherefor, of which will interfere with the general safety, comfort andconvenience of the Lessor for other lessees of the Building.  There shall be no sale of food or beveragesby any means, except vending machines, without the prior written consent ofLessor, which shall not be unreasonably withheld.  Lessee shall not permit intoxicating liquors to be used, kept orsold in the Leased Premises.  It isunderstood that Lessor may occupy portions of the Building in the conduct ofthe Lessor’s business.  In such event,all references herein to other lessees of the Building shall be deemed toinclude Lessor as an occupant or lessee.

 

 

**9.****                                     ****BUSINESSHOURS:**

Business Hours used herein shall mean the hours the Lessee iscustomarily open for business, Traditional Holidays, as herein defined,excepted.  The following dates shallconstitute “Traditional Holidays” as said term is used in this Lease:

 

(1)   New Year’s Day

(2)   Memorial Day

(3)   Independence Day

 

 

7

----

 

 

(4)   Labor Day

(5)   Thanksgiving Day

(6)   Christmas Day

 

If in the case a different day shall be observed other than therespective day above-described, then that day which constitutes the daygenerally observed by national banks in the city in which the Leased Premisesis located, shall constitute the Traditional Holiday under this Lease.

 

 

**10.****                              ****REPAIRS BYLESSOR:**

Lessor shall at its expense maintain in good repair, reasonable wearand tear excepted, only the roof, foundation and the structural soundness ofthe exterior walls of the Building and those portions of the plumbing, heating,air conditioning, and electrical systems located within, but not servingexclusively, the Leased Premises. Lessee shall repair and pay for any damage caused by the act ornegligence of Lessee or Lessee’s employees, agents, representatives, customersor invitees, or caused by Lessee’s default hereunder.  Lessee shall immediately give Lessor written notice of defect orneed for repairs, after which Lessor shall have reasonable opportunity torepair same or cure such defect. Lessor’s liability hereunder shall be limited to the cost of suchrepairs or curing of such defects.

 

If the defect or need for repair causes the Leased Premises to beuntenable and the Lessor has not cured the defect or made the necessary repairswithin forty eight (48) hours after receiving Notice, as defined herein,Monthly Rent will abate until the Leased Premises becomes tenable and theLessee shall have the right, but not the obligation, to cure the default or makethe necessary repairs and to deduct all reasonable costs associated with suchcure from future Monthly Rent obligation.

 

If the defect or need for repair does not cause the Leased Premises tobecome untenable and the Lessor has not cured the defect or made the necessaryrepairs within five (5) days, or other such time as may be deemed reasonable,the Lessee shall have the right, but not the obligation to cure the default ormake the necessary repairs and to deduct all reasonable costs associated withsuch cure from future Monthly Rent obligations.

 

 

**11.****                              ****REPAIRS BYLESSEE:**

Lessee shall at its own cost and expense maintain all other parts ofthe Leased Premises in good repair, reasonable wear and tear excepted, andshall take good care of the Leased Premises and its fixtures and permit nowaste of any kind.  Lessee will keep thewhole of the Leased Premises in a safe, clean, and sanitary condition, and willat the expiration of the Lease Term, or other termination of this Lease,surrender the same to Lessor in the same order and condition as said LeasedPremises was in at the time Lessee took occupancy, reasonable wear and tearexcepted.

 

 

**12.****                              ****ALTERATIONS:**

Lessee shall not make any alterations of, or additions to, the LeasedPremises, which effect the Building’s mechanical systems or structuralsoundness, without the prior written consent of Lessor, which shall not beunreasonably withheld.  Lessee will notpermit any mechanics’, laborers’ or material men’s liens to stand against theLeased Premises, Building or the Property for any labor or material furnishedto or for the account of Lessee, or claimed to have been so furnished inconnection with any work performed or claimed to have been performed in, orabout the Leased Premises, unless Lessee has a good faith dispute as to suchlien in which case Lessee may contest such lien by appropriate proceedings solong as Lessee deposits with Lessor a bond 

 

 

8

----

 

 

or other security in an amount reasonably acceptable to Lessor whichmay be used by Lessor to release such lien if Lessee shall fail to payimmediately any judgment against it as a result of such contest.

 

Notwithstanding anything to the contrary contained in this Lease,Lessor shall in all events have the right to prescribe the weight and positionof any safes and other heavy equipment placed in or on the Leased Premises byLessee.  Any and all damage or injury tothe Leased Premises or the Building caused by moving the property of Lessee inor out of the Leased Premises, or due to the same being in or on the LeasedPremises, shall be repaired by Lessee at its sole cost and expense.  No equipment, fixtures, furniture or otherbulky matter will be received into or carried in the Building, except in or atsuch places and in such manner as approved by Lessor, and all moving ofLessee’s property in or out of the Leased Premises shall be done only afterLessee has received Lessor’s consent and then under the direct control andsupervision of Lessee.

 

 

**13.****                              ****TERMINATION:**

All movable office furnishings and trade fixtures installed by Lesseemay be removed by Lessee at the termination of this Lease if Lessee so elects,and shall be removed if required by Lessor. All such removal and restoration shall be accomplished in a good andworkmanlike manner so as not to damage the primary structure or structuralqualities of the Leased Premises and Building. Unless otherwise agreed to, personal property remaining in the LeasedPremises at the expiration of the Lease Term or other termination of the Leaseshall be deemed abandoned and Lessor may dispose of the same in a manner Lessordeems most expedient.

 

Lessee shall promptly surrender all keys for the Leased Premises toLessor at the place then fixed for the payment of rent and shall inform Lessorof combinations on any vaults, locks and safes on the Leased Premises.

 

 

**14.****                              ****SIGNS:**

Lessee shall not display, inscribe, print, maintain, or affix any signsor other advertising matter or material on the Property, or on the exterior ofthe Building or on the interior of the Building, or in any window of theBuilding, without the prior written consent of the Lessor which shall not beunreasonably withheld.  The signagedescribed in Exhibit D is deemed approved by the Lessor.  The Lessor shall have the right to installand maintain a sign or signs on the Property, or on the exterior or interior ofthe Building.  The Lessor shall have theright to change the name or street address of the Building.  At no time prior to the termination of thisLease shall Lessor display a sign on the Property indicating that the LeasedPremises is available.

 

 

**15.****                              ****ACCESS:**

Lessor, its agents and representatives shall be entitled to keep passkeys to the Leased Premises and shall have the right upon twenty-four (24) hoursprior notification, in the case of emergency at anytime, to enter and inspectthe Leased Premises for the purpose of ascertaining the condition thereof or inorder to make such repairs as may be required to be made by Lessor under theterms of this Lease or as Lessor may deem necessary.  During the period that is six (6) months prior to the end of theLease Term hereof, unless notified by Lessee of it’s intent to extend saidLease, Lessor and Lessor’s agents and representatives shall have the right to enterthe Leased Premises at reasonable times for the purpose of showing the LeasedPremises.  Any such entry by Lessorshall never be deemed an eviction or disturbance of Lessee’s possession of theLeased Premises, or render Lessor liable to Lessee for damages, or relieveLessee from performance of Lessee’s 

 

 

9

----

 

 

obligations under this Lease. If in the event Lessor enters the Leased Premises in the case of anemergency, Lessor will advise Lessee on the next business day of it’s entry.

 

The right of entry reserved shall not be deemed to impose any greaterobligation on Lessor to clean, maintain, repair or change the Leased Premisesthan is specifically provided in this Lease. The Lessor, its agents and representatives may at any time in case ofemergency enter the Leased Premises and do such acts as Lessor may deem properin order to protect the Leased Premises, the Property, the Building, or anyoccupants of the Building.

 

All rights to enter by Lessor and it’s agents and representatives shallbe subject to such security restrictions as may be reasonably imposed by Lesseeconsistent with the nature

of the Lessee’s use of the Leased Premises.

 

 

**16.****                              ****UTILITIESAND SERVICES:**

 

A.           *AIR CONDITIONING AND HEAT:* Lessor shallfurnish air conditioning and heat to the Leased Premises for normal purposesonly during Business Hours.  Lesseeagrees not to use any apparatus or device, in or upon or about the LeasedPremises, which in any way may increase the amount of such services usuallyfurnished or supplied to the Leased Premises, and Lessee further agrees not toconnect any apparatus or device with the conduits or pipes, or other means, bywhich such services are supplied, for the purpose of using additional orunusual amounts of such services, without the prior written consent of Lessor,which shall not be unreasonably withheld. Should Lessee use such services to excess or request the use of suchservices at other than Business Hours, Lessor reserves the right to charge theLessee for such services, which shall be payable as Additional Rent.

 

B.             *ELECTRICAL SERVICE:***Lessor shall maintainelectrical facilities to provide sufficient power for typewriters, personalcomputers, and other office machines of similar low electrical consumption, butnot including electricity required for electronic data processing equipment orspecial lighting which is in excess of Building Power Standards as described inArticle 1.K.

 

Lessee will obtain prior written approval from Lessor before installingelectrical equipment including but not limited to electrical heating,refrigeration equipment, electronic data processing machines, or machines orequipment using current which will in any way increase the amount ofelectricity normally furnished for use in a general office space.

 

The Lessor shall replace building standard light bulbs in the LeasedPremises.  The Lessor’s cost of suchreplacement shall be passed back to the Lessee as Additional Rent.

 

C.             *KEYS:* Lessor shallfurnish Lessee with two (2) keys for each door entering the LeasedPremises.  Additional keys ordered byLessee will be at the expense of Lessee. All such keys shall remain the property of the Lessor.  No additional locks shall be allowed on anydoor of the Leased Premises without Lessor’s written permission, which shallnot be unreasonably withheld, and Lessee shall not make, or permit to be made,any duplicate keys, except those approved or furnished by Lessor.  Upon termination of this Lease, Lessee shallsurrender to Lessor all keys to the Leased Premises, and give to Lessor thecombination of 

 

10

----

 

 

all locks for safes, safe cabinets and vault doors, if any, which willremain in the Leased Premises.

 

D.            *ELEVATORS:* If theBuilding has a passenger elevator which provides service to the LeasedPremises, Lessor shall furnish passenger elevator service whenever the Buildingis open.  Lessor shall have the right tostop the operation of said elevators whenever alterations, improvements orrepairs shall be necessary or desirable and shall not be liable for damages forany such stoppage of service except as stated in Article 10.

 

E.              *JANITORIAL:* Lessor shallfurnish such janitor service, as is customary in a “Class A” building in thecommunity where the Building is located, except on Saturdays, Sundays andTraditional Holidays.  All janitorialservices shall be performed in accordance with work schedules established bythe Lessor subject to Lessee’s reasonable approval, and the Lessor’s cost ofproviding such service shall be passed back to the Lessee as AdditionalRent.  Providing that the amount oftrash (paper waste) does not exceed what would be customary for a generaloffice of the size of the Leased Premises and the use described in Article 1.J,trash removal shall be furnished by the Lessor.  If Lessee has a 

 

 

11

----

 

significant increase in paper waste or periodically disposes of largecontainers, additional costs incurred by the Lessor for the Lessee’s actionsmay be passed back to the Lessee as Additional Rent.

 

F.              *WATER:* Lessor shallprovide water for drinking, lavatory and toilet purposes only.

 

G.             *WASTE:* Lessee shallnot waste electricity, water, heat or air conditioning or any other utility,and shall cooperate fully with Lessor to insure the most effective operation ofthe Building’s heating and air conditioning, which shall include closingVenetian blinds and drapes and keeping all windows closed when air conditioningis in use, and shall refrain from attempting to adjust any controls other thanroom thermostats, if any, installed for Lessee’s use.

 

H.            *INTERRUPTION OF SERVICES:* Lessor shallnot be liable to Lessee, its agents, employees, representatives, customers orinvitees for any inconvenience, loss or damage or for any injury to any personor property caused by or resulting from temporary variation, interruption orfailure to provide services or utilities, nor shall such temporary violation,interruption or failure to provide service or utilities be deemed an evictionof Lessee or relieve Lessee from any of Lessee’s obligations hereunder.

 

If a variation, interruption or failure to provide services orutilities cause the Leased Premises to be untenantable and Lessor has not curedsuch variation, interruption, or failure to provide services or utilitieswithin forty-eight (48) hours after receiving Notice, as defined herein,monthly Rent will abate until the Leased Premises becomes tenantable and theLessee shall have the right, but not the obligation, to cure the variation,interruption or failure to provide services or utilities and to deduct allreasonable cost associated with such cure from future monthly Rent obligations.

 

 

**17.****                              ****ASSIGNMENT AND SUBLETTING:**

Lessee shall have the right to assign this Lease, or to sublet thewhole or any part of the Leased Premises with the prior written consent ofLessor, which shall not be unreasonably withheld.  Lessor hereby approves any and all assignments or sublets to anyaffiliate of Lessee or it’s parent company and affiliates of the parentcompany. Lessee can assign or sublet to any affiliate without prior writtenapproval.  Notwithstanding any permittedassignment or subletting, Lessee shall at all times remain fully responsibleand liable for the payment of the Rent herein specified and for compliance withall of its other obligations under the terms, provisions and covenants of thisLease.  Lessor shall have the right toassign any of its rights under this Lease, and upon any such assignment, andprovided that the assignee assumes all of Lessor’s obligations hereunder,Lessor shall be relieved of any and all such obligations.

 

 

**18.****                              ****FIRE ANDCASUALTY:**

If the Building or any part thereof is damaged or destroyed by fire orother casualty, the Lessee shall have the right to terminate this Lease,provided it gives written notice thereof to the Lessor within ninety (90) daysafter such damage or destruction.  Suchtermination shall be effective as of the date of the fire or othercasualty.  If a portion of the LeasedPremises is damaged by fire or other casualty and this Lease is not therebyterminated, the Lessor shall, at its expense, restore the Leased Premisesexclusive of any

 

 

12

----

 

 

improvements or other changes made to the Leased Premises by Lessee, toas near the condition which existed immediately prior to such damage ordestruction as reasonably possible, and Monthly Rent shall abate during suchperiod of time as the Leased Premises are untenable in the proportion that theuntenable portion of the Leased Premises bears to the entire LeasedPremises.  The Lessor shall not beresponsible to the Lessee for damage to, or destruction of, any furniture,equipment, improvements or other changes made by the Lessee in, on or about theLeased Premises regardless of cause of damage or destruction.

 

 

**19.****                              ****SUBROGATION:**

Lessor and Lessee each hereby release the other from any and allliability or responsibility to the other or anyone claiming through or under themby way of subrogation or otherwise for any loss or damage to property caused byfire or any of the extended coverage casua lties covered by the insurancemaintained hereunder even if such loss or damage shall have been caused by thefault or negligence of the other party, provided, however, that this releaseshall be applicable and in force and effect only with respect to loss or damageoccurring during such times as the releaser’s insurance policies shall containa clause or endorsement to the effect that any release shall not adverselyaffect or impair said policies or prejudice the right of the releaser torecover thereunder.  Lessor and Lesseeeach agree that it will request its insurance carrier to include in itspolicies such a clause or endorsement.

 

 

**20.****                              ****LIABILITY:**

With the exception of those claims arising out of Lessor’s negligenceor willful misconduct, Lessor shall not be liable to Lessee, or those claimingthrough or under Lessee, for injury, death or property damage occurring in, onor about the Property, the Building, the Leased Premises and appurtenancesthereto, and Lessee shall indemnify Lessor and hold it harmless from any claimor damage arising out of any injury, death or property damage occurring in, onor about the Leased Premises to Lessee or an employee, customer or invitee ofLessee except to the extent such injury, death, or property damage is caused byacts of the Lessor, its agents or employees.

 

With the exception of those claims arising out of Lessee’s negligenceor willful misconduct, Lessee shall not be liable to Lessor, or those claimingthrough or under Lessor, for injury, death or property damage occurring in, onor about the Property, the Building, the Leased Premises and appurtenancesthereto, and Lessor shall indemnify Lessee and hold it harmless from any claimor damage arising out of any injury, death or property damage occurring in, onor about the Leased Premises to Lessor or an employee, customer or invitee ofLessor.

 

**21.****                              ****INSURANCE:**

 

A.    Lessor agrees to purchase in advance, and tocarry in full force and effect the following insurance:

 

1)              “All risk” propertyinsurance coverage on the Building, exclusive of Lessee’s leasehold improvements, in such amount as Lessor deemsprudent.

 

2)              Comprehensive general publicliability insurance covering theProperty, in a combined single limit amount of not less than$2,000,000.00, and written on an “occurrence” basis.

 

B.    Lesseeagrees to purchase in advance, and to carry in full force and effect thefollowing 

 

13

----

 

insurance:

 
| 1)     |   | “All risk” property  insurance covering the full replacement value of all |
|--------|--------|-------------------------------------------------------------------------------------|
|   |   | of Lessee’s leasehold  improvements, trade fixtures and personal               |
|   |   | property within the Leased  Premises.                                               |
|   |   |                                                                                |
| 2)     |   | Comprehensive general  public liability insurance covering all acts of              |
|   |   | Lessee, its employees,  agents, representatives and guests on or about              |
|   |   | the Leased Premises,  containing a contractual liability endorsement, in            |
|   |   | a combined single limit  amount of not less than $2,000,000.00 and                  |
|   |   | written on an “occurrence”  basis.                                        |

 

C.    In addition, if at any timeLessee allows said insurance to lapse, Lessor, upon notification, can placesaid insurance on behalf of Lessee and immediately bill Lessee for the amountof the insurance premium.  Any suchpremium will become a part of the Additional Rent owing at the time the premiumis billed and will qualify for all rights of collection as afforded by thisLease.

 

 

**22.****                              ****EMINENTDOMAIN:**

If the entire Building is taken by eminent domain, this Lease shallautomatically terminate as of the date of taking.  If a portion of the Building is taken by eminent domain, Lesseeshall have the right to terminate this Lease by giving written notice thereofto Lessor within ninety (90) days after the date of taking.  Such termination shall be effective as ofthe date of taking.

 

If a portion of the Leased Premises is taken by eminent domain and thisLease is not thereby terminated, Lessor shall, at its expense, restore theLeased Premises, exclusive of any improvements or other changes made to theLeased Premises by Lessee, to as near the condition which existed immediatelyprior to the date of taking as reasonably possible, and Rent shall abate duringsuch period of time as the Leased Premises are untenable, in the proportionthat the untenable portion of the Leased Premises bears to the entire LeasedPremises.

 

All damages awarded for a taking under the power of eminent domain,whether for the whole or a part of the Leased Premises, shall belong to, and bethe property of, Lessor, whether such damages shall be awarded as compensationfor diminution in value to the leasehold estate hereby created or to the fee ofthe Leased Premises provided, however, that Lessor shall not be entitled to anyaward made to Lessee for loss of business, fair value of, and cost of removalof stock and fixtures.

 

The term “eminent domain” shall include the exercise of any similargovernmental power and any purchase or other acquisition in lieu ofcondemnation.

 

 

**23.****                              ****HOLDINGOVER:**

Should Lessee, or any of its successors in interest, hold over theLeased Premises or any part thereof, after the expiration of the Lease Term,such holding over shall constitute and be construed as a tenancy frommonth-to-month only.  The inclusion of thepreceding sentence shall not be construed as Lessor’s permission for Lessee tohold over.  The monthly rent during suchmonth-to-month tenancy shall be at one and one half (1 1/2) times the amount ofsaid monthly Rent for the last month of the Lease term or any extension term.

 

 

14

----

 

 

**24.****                              ****QUIETENJOYMENT:**

Lessor represents and warrants that it has full right and authority toenter into this Lease and that Lessee, upon paying the Monthly Rent andAdditional Rent herein set forth and performing its other covenants andagreements herein set forth, shall peaceably and quietly have, hold and enjoythe Leased Premises for the Lease Term without hindrance or molestation fromthe Lessor, subject to the term and provisions of this Lease.

 

 

**25.****                              ****EVENTS OFDEFAULT:**

The following events shall be deemed to be events of default by Lesseeunder this Lease:

 

A.                       Lessee shallfail to make any payment of the Rent as herein provided within five (5) days ofthe date that Notice is received by the Lessee indicating that the Rent was notreceived by Lessor.

 

B.                         Lessee shallbecome insolvent, or shall make a transfer in fraud of creditors, or shall makean assignment for the benefit of creditors.

 

C.                         Lessee shallfile or have filed against it a petition under any section or chapter of theUnited States Bankruptcy Code, as amended, or under any similar law or statuteof the United States or any state thereof, or Lessee shall be adjudged bankruptor insolvent in proceedings filed against Lessee thereunder.

 

D.                        A receiver ortrustee shall be appointed for all or substantially all of the assets ofLessee.

 

E.                          Lessee shallabandon the Leased Premises.

 

 

F.                          Lessee shallfail to comply with any term, provision or covenant of this Lease (other thanthe foregoing in this Article 25) and shall not cure such failure within thirty(30) days of receiving written notice of failure thereof to Lessee; providedhowever, if such failure is capable of being cured, but cannot be cured withinsuch thirty (30) day period, if Lessee shall promptly commence to cure the sameand shall thereafter prosecute the curing thereof with diligence, the periodwithin which such failure may be cured shall be extended for such furtherperiod as shall be necessary for the curing thereof with diligence.

 

 

**26.****                              ****DEFAULT:**

Lessee hereby agrees that if an Event of Default occurs, then, inaddition to all other rights and remedies available to Lessor by law or byother provisions hereof, at Lessor’s option, Lessor may annul and cancel thisLease as to all future rights of Lessee. Lessee further agrees that in case of any such termination Lessee willindemnify the Lessor against all loss of Rent and other damage which Lessor mayincur by reason of such termination, including, but not limited to, costs ofrestoring and repairing the Leased Premises and putting the same in rentablecondition, costs of renting the Leased Premises to another tenant, loss ordiminution of rents and other damage which Lessor may incur by reason of suchtermination and all reasonable attorneys fees and expenses incurred inenforcing any of the terms of this Lease. Neither acceptance of Rent by Lessor, with or without knowledge ofbreach, nor failure of Lessor to take action on account of any breach thereof,or to enforce its rights hereunder shall be deemed a waiver of any breach, andabsent written notice or consent, said breach shall be a continuing one.

 

 

15

----

 

 

In the event Lessee fails to pay any installment of Rent hereunder asand when such installment is due, or any other charge payable hereunder as andwhen such charge is due, Lessee, if permitted by law, shall pay to Lessor ondemand a late charge in an amount equal to five percent (5%) of such installmentor other charge, or $25.00, whichever is greater, and failure to pay such latecharge within ten (10) days after demand therefore shall be an Event of Defaulthereunder.  The provision for such latecharge shall be in addition to all Lessor’s other rights and remedies hereunderor at law and shall not be construed as liquidated damages or as limitingLessor’s remedies in any manner.

 

 

**27.****                              ****NOTIFICATION IN EVENT OF SALE OR TRANSFER:**

In the event of the sale of the Property or the Building or thetransfer of the title thereto, upon notification to Lessee, Lessor shall berelieved of all of the covenants and obligations created by this Lease, exceptas to breaches thereof occurring prior to such sale or transfer, and such saleor transfer shall automatically result in the purchaser or transferee assumingand agreeing to carry out all of the covenants and obligations of Lessor hereinfrom and after such sale or transfer.

 

**28.****                              ****NOTICES:**

Each provision of this Lease or of any applicable governmental laws,ordinances, regulations and other requirements with referenced to the sending,mailing or delivery of any notice or the making of any payment by Lessor toLessee or by Lessee to Lessor shall be deemed to be complied with, when and if,the following steps are taken:

 

A.                       All paymentsrequired to be made by Lessee to Lessor hereunder shall be payable to Lessor atthe address set forth in Article 1.I or at such other addresses Lessor mayspecify from time to time by written notice delivered in accordance herewith.

 

B.                         Any notice ordocument required or permitted to be delivered hereunder shall be deemed to bedelivered, whether actually received or not, when deposited in the UnitedStates mail, postage prepaid, certified or registered mail, addressed to theparties hereto at the respective addresses set out opposite their names asshown in Article 1.M for Lessor, and 1.B for Lessee, or at such other addressas they have theretofore specified by written notice delivered in accordanceherewith.

 

C.                         In the case ofa Notice being given to the Lessee, a copy of said Notice must be delivered ina like manner to:

Northern Star Bank

300 East St. Germain Street

St. Cloud, MN 56304

 

**29.****                              ****RULES ANDREGULATIONS:**

Lessee shall observe such rules and regulations as set forth in ExhibitC and other rules and regulations which from time to time, and upon reasonableNotice, may be put in effect by Lessor for the general safety, comfort andconvenience of Lessor, occupants and tenants of the Building.

 

**30.****                              ****GOVERNMENTAL/LEGAL ACTIONS:**

Wherever in this Lease any terms, covenants or conditions are requiredto be kept or performed by the Lessor, the Lessor shall be deemed to have keptand performed such terms, covenants and conditions notwithstanding any actiontaken by the Lessor, if such action is pursuant to any 

 

 

16

----

 

 

governmental regulations, requirements, directives or requests, so longas such action is taken in regard to the entire Building.

 

Throughout the Term of this Lease, Lessor shall observe and comply withall governmental codes, laws, requirements, rules, orders, ordinances andregulations, and orders applicable to the Property.

 

 

**31.****                              ****LIGHT ANDAIR:**

Lessee has not right to light or air over the Property or any premisesadjoining the Building.

 

 

**32.****                              ****BROKERAGEFEES:**

Lessee represents and warrants that it has dealt with no broker, agentor other person in connection with this Lease and Lessee hereby indemnifies andholds harmless from and against any claims by any broker, agent or other personclaiming a commission or other form of compensation by virtue of having dealtwith Lessee with regard to this Lease. The provisions of this paragraph shall survive the expiration ortermination of this Lease.

 

 

**33.****                              ****FORCEMAJEURE:**

If either party hereto shall be delayed or hindered in or preventedfrom the performance of any act required hereunder by reason of strikes,lockouts, labor troubles, inability to procure material, failure of power,restrictive governmental laws or regulations, riots, insurrection, war or otherreason of a like nature not the fault of the party delayed in performing workor doing acts required under this Lease, the period for the performance of anysuch act shall be extended for a period equivalent to the period of such delay. Notwithstanding the foregoing, theprovisions of this Article 34 shall at no time operate to excuse Lessee fromany obligations for payment of Rent, or any other payments required by theterms of this Lease when same are due, and all such amounts shall be paid whendue.

 

 

**34.****                              ****ESTOPPELCERTIFICATE:**

Lessee agrees, within ten (10) days after request of Lessor, to deliverto Lessor, or Lessor’s designee, including without limitation, the present orany future holder of any mortgage(s) and/or deed(s) or trust and/or groundlease(s) and/or underlying lease(s) on the Leased Premises, or any prospectivepurchaser of the Property, Leased Premises or the Building, an estoppelcertificate stating that this Lease is in full force and effect, the date towhich Rent or other charges have been paid, the unexpired Lease Term, whetheror not Lessor is in default hereunder, and the nature of any such default, andsuch other matters pertaining to this Lease as may be reasonably requested byLessor.

 

 

**35.****                              ****MISCELLANEOUS:**

 

A.                       Words of anygender used in this Lease shall be held and construed to include any othergender, and words in the singular number shall be held to include the plural,unless the context otherwise requires.

 

17

----

 

 

B.                         The terms,provisions and covenants and conditions contained in this Lease shall

 

apply to, inure to the benefit of, and be binding upon, the partieshereto and upon their respective heirs, legal representatives, successors andpermitted assigns, except as otherwise herein expressly provided.

 

C.                         Failure ofLessor to insist, in any or more instances, upon strict performance of anyterm, covenant or condition of this Lease, or to exercise any option hereincontained shall not be construed as a waiver, or a relinquishment for thefuture, or such term, covenant, condition or option, but the same shallcontinue and remain in full force and effect. The receipt by Lessor of Rent with knowledge of a breach in any of theterms, covenants or conditions of the Lease to be kept or performed by Lesseeshall not be deemed waiver of such breach, and Lessor shall not be deemed tohave waived any provision of this Lease unless expressed in writing and signedby Lessor.

 

**36.****                              ****INVALIDITY OF PARTICULAR PROVISIONS:**

If any clause or provision of this Lease is or becomes illegal,invalid, or unenforceable because of present or future laws or any rule orregulation of any governmental body or entity, effective during its term, theintention of the parties hereto is that the remaining parts of this Lease shallnot be affected thereby unless such illegality, invalidity, or unenforceabilityis, in the sole determination of Lessee, essential to the rights of bothparties in which event Lessee has the right to terminate this Lease on writtennotice to Lessor.

 

**37.****                              ****GOVERNINGLAW:**

This lease shall be governed by and interpreted under the laws of thestate in which the Leased Premises is located.

 

**38.          RIGHT OFFIRST REFUSAL:**

The Lessee shall have the first right of refusal to acquire and leasethe 1,300 square feet of contiguous space presently occupied by RiedmanInsurance when such space becomes available. The said “space” shall be leased to Lessee under the same terms,conditions, and rental rates as stated under the “initial lease” and anyextensions.  The Lessor agrees to notifyLessee and from the date of notification, allow Lessee 15 business days torespond as to whether it wishes to exercise this option.  In the event the Lessee does not respond,the Lessee, after the 15th business day, forfeits the right of first refusaland the****Lessor****hasno further obligations to honor this option.

 

**39.****                              ****SUBJECT TOAPPROVAL:**

This lease is subject to the approval of the commissioner.

 

 

18

----

 

 

**IN WITNESSWHEREOF**, the Lessor and Lessee have executed this Lease on the day and yearfirst written above.

 

 
| **LESSOR:**                                |   | **LESSEE:**            |
|--------------------------------------------|--------|------------------------|
|                                       |   |                   |
| **Five Star Properties of St. Cloud, LLC** |   | **Northern Star Bank** |
|                                       |   |                   |
| **By:**                                    |   |                   |   | **By:** |   |   |
| **Its:**                                   |   |                   |   | **Its:** |   |   |
|                                       |   |                   |
| **By:**                                    |   |                   |   | **By:** |   |   |
| **Its:**                                   |   |                   |   | **Its:** |   |   |

 

 

 

19

----

 

 

**LESSEEIMPROVEMENT AGREEMENT**

 

 

Lessor will provide $15,000 to Lessee for any leasehold improvementsprior to occupancy.

 

 

 

 

 

 

 

20

----

 

 

**EXHIBIT B**

 

 

**SIGNS**

 

 

Lessor may permit signs to be placed, for the term of the Lease and anyrenewals or extensions, on the building to include its logo and name, providedthe size, style, text, color and location are first approved in writing byLessor, approval not to be unreasonably withheld by Lessor.  Lessor may allow other exterior signage tobe placed for the term of this Lease and any renewals or extension, except thattheir location, shape, lighting, and other details must also be approved by theCity and Lessor, approval not to be unreasonably withheld by Lessor.  Any sign or lettering not so approved may beremoved by Lessor at Lessee’s expense.

 

The Lessee shall maintain its signage in good repair at all times.

 

 

 

21

----

 

 

**EXHIBIT D**

 

 

**ADDENDUM**

 

 

This Addendum is made a part of the Lease Agreement dated March 7, 2001by and between Five Star Properties of St. Cloud, LLC (“Lessor”) and NorthernStar Bank (“Lessee”).

 

**1.****                                     ****OPTION TO EXTEND:**

Lessee shall have the right, at its option to extend this Lease for 1term (hereafter referred to “Extension Term”) for 5 years.  In order to exercise this right for theinitial Extension Term and each succeeding extension term, the Lessee must:

 

A.                       Notify theLessor in writing 180 days prior to the Expiration Date of this Lease ofLessee’s intent to extend this Lease.

 

B.                         The Lessee mustnot be in default in the performance of any terms, covenants, conditions andagreements herein contained in respect to a matter to which notice of defaulthas been given hereunder, which has not been or is not being remedied withinthe time permitted in this Lease, on the date Lessee provides notice of itsintentions to extend the term hereof and on the date of commencement of theExtension Term.

 

C.                         New rent forthe extended option period will be $22.00 per square foot.

 

**2.****                                     ****ADDITIONAL RENT:**

The Lessee will pay as Additional Rent, 27.81 percent of the Lessor’scost to maintain (i.e., snow removal) and repair the parking lot, the drive-in“stacking” lanes, and the surface of the drive-thru lanes.

 

**3.****                                     ****TRAINING ROOM USE:**

The Lessee shall, at no cost to the Lessee and on a “first come firstserve” basis, be entitled to use the area designated by the Lessor as theTraining Room.  The Training Room shallbe designated as a smoke free area by the Lessor.

 

 

22

----