Document:

Exhibit
10.1

AMENDMENT NO. 1 TO

NITROMED, INC.

EXECUTIVE SEVERANCE BENEFIT PLAN

Pursuant to
Section IX, Clause 7 of the NitroMed, Inc. Executive Severance Benefit Plan
(the “Plan”), the Plan be, and hereby is, amended as set forth below.  Capitalized terms used and not otherwise
defined herein shall have the respective meanings ascribed to them in the Plan.

1.             Section III, Clause 1 of the Plan
is hereby deleted in its entirety and the following is substituted in its
place:

“1.                                 salary
continuation at the Participant’s base rate of pay (as in effect immediately
prior to termination, exclusive of any bonuses, commissions, overtime pay, or
other extra forms of compensation and less applicable taxes and withholdings)
(the “Severance Pay”); provided that, if the Company determines it
necessary in order to ensure compliance with Section 409A, the Severance Pay
may be paid in a lump sum; and”

2.             Clause 2 of Schedule A to the Plan is
hereby deleted in its entirety and the following is substituted in its place:

“2.           Executives who have been designated
at the level of Vice President or higher by the NitroMed Board of Directors or
its Compensation Committee shall be provided salary continuation and
contributions to the cost of COBRA coverage pursuant to Section III of the Plan,
and subject to the terms of the Plan, for a period of six (6) months from a
covered termination of employment.  If
such an executive remains unemployed throughout and at the conclusion of the
initial six month period referenced in the preceding sentence, such executive
shall be provided salary continuation and contributions to the cost of COBRA
coverage pursuant to Section III of the Plan, and subject to the terms of the
Plan, for up to an additional period of six (6) months; provided, however,
that if at any time during such additional six month period such executive becomes
reemployed with another employer in a comparable position, the benefits
provided pursuant to this paragraph shall terminate immediately.”

3.             Except as herein provided, all
other terms and conditions of the Plan remain unchanged and in full force and
effect.

 

NITROMED, INC.

	
  By:

  	
   

  	
  /s/ Kenneth M. Bate

  	
   

  
	
  Name:

  	
   

  	
  Kenneth M. Bate

  
	
  Title:

  	
   

  	
  Chief Financial Officer, Chief Operating Officer,

  
	
   

  	
   

  	
  Treasurer and SecretaryExhibit
10.2

NITROMED, INC.

Amendment No. 1 to Agreement

This Amendment No. 1 to Agreement (the “Amendment”), by
and between NitroMed, Inc., a Delaware corporation (the “Company”), and                     
(the “Employee”), is made as of the date set forth below and amends that certain
Agreement, dated April    , 2006, by and between the Company and
the Employee (the “Agreement”).

Pursuant to
Section 7.9 of the Agreement, the Agreement be, and hereby is, amended as set
forth below.  Capitalized terms used and
not otherwise defined herein shall have the respective meanings ascribed to
them in the Agreement.

1.             Section 4.2(a)(i)(2) is hereby deleted
in its entirety and the following is substituted in its place:

“(2)         the amount equal to
(A) the Employee’s highest annual base salary during the two-year period
prior to the Change in Control Date (the “Benchmark Salary”) multiplied by (B)
0.5.”

2.             Section 4.2(a)(ii) of the Agreement
is hereby deleted in its entirety and the following is substituted in its
place:

“(ii)         for twelve (12)
months after the Date of Termination, or such longer period as may be provided
by the terms of the appropriate plan, program, practice or policy, the Company
shall continue to provide benefits to the Employee and the Employee’s family at
least equal to those which would have been provided to them if the Employee’s
employment had not been terminated, in accordance with the applicable Benefit
Plans in effect on the Measurement Date or, if more favorable to the Employee
and his family, in effect generally at any time thereafter with respect to
other peer executives of the Company; provided, however, that if the
Employee becomes reemployed with another employer and is eligible to receive a
particular type of benefits (e.g., health insurance benefits) from such
employer on terms at least as favorable to the Employee and his family as those
being provided by the Company, then the Company shall no longer be required to
provide those particular benefits to the Employee and his family;”

3.             Section 4.2(a)(v) is hereby added
to the Agreement as follows:

“(v)         If the Employee
remains unemployed throughout and at the conclusion of the six-month period
immediately following the Date of Termination, the Company shall pay to the
Employee in cash, in advance on a monthly basis, for up to six (6) months
following the six-month anniversary of the Date of Termination (the “Additional
Period”), an amount equal to 1/12 of the Benchmark Salary; provided, however,
that if at any time during the Additional Period the Employee becomes
reemployed with another employer in a comparable position, the salary
continuation payments provided pursuant to this paragraph shall terminate
immediately.”

4.             Except as herein provided, all
other terms and conditions of the Agreement remain unchanged and in full force
and effect.

IN WITNESS WHEREOF, the parties hereto have executed
this Amendment as of the day and year set forth below.

	
  

  	
   

  	
  NITROMED,
  INC.

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  [NAME
  OF EMPLOYEE]

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Signature

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Address:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Date:

  	
   

  	
   

  
							

 

 2

 

 

NitroMed,
Inc.

Schedule
of Executive Officers Party to Form of Amendment No. 1 Attached Hereto

The executive officers of
NitroMed, Inc. named below have entered into the attached form of Amendment No.
1 to Agreement.  The following chart
illustrates the material differences in the terms of the form of Agreement, as
amended by Amendment No. 1, entered into by each such executive officer:

	
  Name of

  Executive

  Officer

  	
   

  	
  Date of

  Agreement

  	
   

  	
  Date of

  Amendment

  No. 1

  	
   

  	
  Stock Acceleration

  	
   

  	
  Severance

  Payment

  	
   

  	
  Period of

  Continuation of

  Benefits

  	
   

  	
  Period of

  Determining

  Eligibility for

  Retiree Benefits

  
	
  James G. Ham, III

  	
   

  	
  4/9/06

  	
   

  	
  8/18/06

  	
   

  	
  50% of then outstanding stock options accelerate

  	
   

  	
  50% of highest annual base salary during the
  two-year period prior to the change in control date (“Benchmark Salary”); if
  continued unemployment at conclusion of 6 month period following termination,
  additional monthly payments for up to six months of 1/12 of Benchmark Salary,
  provided not reemployed in comparable position

  	
   

  	
  12 months after date of termination

  	
   

  	
  6 months after date of termination

  
	
  Jane A. Kramer

  	
   

  	
  4/11/06

  	
   

  	
  8/18/06

  	
   

  	
  50% of then outstanding
  stock options accelerate

  	
   

  	
  50% of highest annual
  base salary during the two-year period prior to the change in control date
  (“Benchmark Salary”); if continued unemployment at conclusion of 6 month
  period following termination, additional monthly payments for up to six
  months of 1/12 of Benchmark Salary, provided not reemployed in comparable
  position

  	
   

  	
  12 months after date of
  termination

  	
   

  	
  6 months after date of
  termination

  
	
  William “B.J.” Jones

  	
   

  	
  4/6/06

  	
   

  	
  8/18/06

  	
   

  	
  50% of then outstanding
  stock options accelerate

  	
   

  	
  50% of highest annual
  base salary during the two-year period prior to the change in control date
  (“Benchmark Salary”); if continued unemployment at conclusion of 6 month
  period following termination, additional monthly payments for up to six
  months of 1/12 of Benchmark Salary, provided not reemployed in comparable
  position

  	
   

  	
  12 months after date of
  termination

  	
   

  	
  6 months after date of
  terminationEXHIBIT 10.1

MASTER LEASE AGREEMENT

Lessee Full Name
and Full Address: 

Granite
City Food & Brewery Ltd.

5402
Parkdale Drive, Suite #101

Minneapolis,
MN  55416

	
  Name and Phone No. of Lessee Contact:

  	
  Dan Bauer (952) 215-0668

  

 

	
  Lessee
  Form of Organization:

  	
  Corporation

  	
  Fed Tax I.D. No.

  	
  41-1883639

  
	
  (corporation, partnership, limited liability
  company, 

  	
  Date of Master
  Lease

  
	
  individual, etc.):

  	
  Agreement: 

  	
  August
  16, 2006

  	
   

  
						

 

	
  Lessee’s State of Organization: 

  (if a corporation or registered 

  organization

  	
  MN

  	
  Lessee’s State Organization Identification Number:

  	
  9S-463

  

 

For and in
consideration of the mutual promises set forth below, Carlton
Financial Corporation (“Lessor”) and the lessee named above (“Lessee”)
agree as follows:

1.              MASTER LEASE.  This Master Lease Agreement (“Master Lease”)
provides terms and conditions the parties hereto intend to be applicable to
various lease transactions.  Each lease
contract shall be evidenced by a Lease Schedule, in the form attached hereto as
Exhibit A, executed by Lessor and Lessee that explicitly incorporates the
provisions of this Master Lease Agreement and sets forth specific terms of that
particular lease contract (each such Lease Schedule, as it incorporates this
Master Lease, shall be called “the Lease”). 
Where the provisions of a Lease Schedule conflict with the terms of this
Master Lease, the provisions of the Lease Schedule shall prevail.  Each Lease Schedule shall constitute a
complete and separate lease agreement, independent of all other Lease Schedules
and without any requirement of being accompanied by an originally executed
counterpart of this Master Lease Agreement. One originally executed counterpart
of the Lease Schedule shall be stamped “Original” and retained by the
Lessor.  If more than one counterpart of
the Lease Schedule is executed by Lessor and Lessee, all other counterparts
shall be stamped “Duplicate Original.” 
Only transfer of possession or control by the Lessor of the originally executed
counterpart stamped “Original” shall be effective for purposes of perfecting an
interest in the Lease Schedule by possession.

2.              NO WARRANTIES.  Lessee agrees that it has selected each item
of equipment and other property (the “Equipment”) described in the Lease
Schedule based upon its own judgment and disclaims any reliance upon any
statements or representations made by Lessor. 
Lessee acknowledges the supplier of the Equipment is not Lessor’s
agent.  THE EQUIPMENT IS LEASED “AS IS”.  LESSOR MAKES NO EXPRESS OR IMPLIED WARRANTY
WITH RESPECT TO THE EQUIPMENT AND SPECIFICALLY DISCLAIMS ANY WARRANTY OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR USE OR PURPOSE AND ANY LIABILITY
FOR CONSEQUENTIAL DAMAGES ARISING OUT OF THE USE OR INABILITY TO USE THE EQUIPMENT.  LESSEE AGREES TO PAY THE RENT REQUIRED
HEREUNDER WITHOUT REGARD TO THE CONDITION OF THE EQUIPMENT.  Lessor agrees to assign the manufacturer’s
warranties to Lessee and Lessee has the right to make warranty claims against
the manufacturer under such warranties. 
The Lessor is obligated to be cooperative in permitting such claims
against the manufacturer.

3.              FINANCE LEASE.  Lessor and Lessee agree that the Lease is a “finance
lease” within the meaning of Article 2A of the Uniform Commercial Code.  The parties agree that the Lessor has not
selected, manufactured or supplied the Equipment.  Lessee acknowledges receipt of a copy of the
contract evidencing Lessor’s purchase of the Equipment.  THERE ARE NO WARRANTIES OR OTHER RIGHTS
PROVIDED TO THE LESSEE BY THE LESSOR OR THE SUPPLIER OF THE EQUIPMENT IN
CONNECTION WITH THIS LEASE EXCEPT AS DESCRIBED HEREIN.

4.              NET AND
NONCANCELLABLE LEASE.  This is a net
Lease and Lessee’s obligation to pay the rent and other amounts due hereunder
is unconditional and not subject to abatement, reduction or setoff, defense,
counterclaim or interruption of any kind. 
The Lease is a non-cancelable lease and will not terminate in the event
of any damage to or destruction of the Equipment.  The 

 

Lease may be
terminated only as expressly provided herein. 
To the extent permitted by law, Lessee waives the right to (i) cancel
the Lease; (ii) repudiate the Lease after the equipment has been Accepted;
(iii) reject the Equipment; (iv) revoke acceptance of the Equipment; (v)
recover damages from Lessor for any breaches of warranty or for any other
reason; (vi) grant a security interest in the Equipment to a third party (vii)
deduct from rents all or any part of claimed damages resulting from Lessor’s
default, if any.  Lessee’s payment of the
rent shall not act to waive any claim that Lessee may have against Lessor under
the terms of this Agreement.

5.              TERM.  The initial term of the Lease (the “Initial
Term”) respecting the Equipment shall commence on the 1st day of the month
following acceptance of the equipment by Lessee and end upon the full
performance and observance by Lessee of each and every term, condition and
covenant set forth in the Lease.  Except
as otherwise provided in the Lease Schedule or any amendment thereto, Lessee or
Lessor may terminate the Lease at the expiration of the Initial Term by giving
the other at least 90 days prior written notice of termination.  If
neither Lessee nor Lessor gives such notice, then the term of the Lease shall
be extended automatically on the same rental and other terms set forth herein
until terminated by either Lessee or Lessor giving the other at least 90 days
prior written notice of termination.

6.              SECURITY DEPOSIT AND
ADVANCE RENTALS.  The Security
Deposit or Advance Rentals specified on each Lease Schedule shall be paid by
Lessee to Lessor upon the signing of the Lease Schedule and may be deposited in
Lessor’s general operating account.  During
the term the Security Deposit is held, Lessor shall pay Lessee interest on the
Deposit semi-annually, at a current market rate for a 12 month CD.  Following completion of the term of the Lease
for that Equipment, and provided there has been no breach of the Lease by
Lessee, Lessor shall refund Lessee the Security Deposit that relates to
Equipment whose lease term has expired. 
No security deposit shall be applied by the Lessee to the last rent
payment.  Any Advance Rentals paid by
Lessee shall be applied to the last rent payments due during the Initial Term
of the Lease, except as otherwise agreed by Lessor.

7.              COMMENCEMENT; RENTAL
PAYMENTS; INTERIM RENTAL; LATE FEES.  The
Lease shall commence upon the written acceptance hereof by Lessor and shall end
upon full performance in observance by Lessee of each and every term,
condition, and covenant set forth in the Lease and any extensions thereof.  The monthly rental payments shall be in
advance and shall be in the amount and frequency as provided in the Lease
Schedule.  The first such rental payment
shall be made on the 1st day of the month following the date on which the
equipment is accepted by the Lessee.  In
addition to regular rentals, Lessee shall pay to Lessor interim rent, which
shall be a pro rata portion of the monthly rental charges based on a daily
rental charge of one-thirtieth (1/30th) of the monthly rental calculated from
the date of which the equipment is accepted by Lessee to the end of the month
and shall be due and payable upon Lessee’s receipt of invoice from Lessor.  Lessee agrees to pay Lessor late charges
equal to five percent (5%) of the amount due for scheduled payments not made
when due.

8.              TITLE.  Title to the Equipment shall at all times
remain in Lessor and Lessee shall protect and defend the title of Lessor and
keep it free of all claims and liens other than those of Lessee hereunder or
created by Lessor.  If the Lease shall be
construed by a court to be a lease “intended as security” and not a “true”
lease, then Lessee, to secure all of Lessee’s payment and performance
obligations under the Lease, hereby grants to Lessor a first priority security
interest in the Equipment (including, without limitation, all inventory,
fixtures or other property comprising the same) together with all related
software (embedded therein or otherwise) and general intangibles, all
additions, attachments, accessories thereto whether or not furnished by the
supplier of the Equipment, all subleases, chattel paper, security deposits
relating thereto, and any and all substitutions, replacements or exchanges for
any such item of Equipment or other collateral and any and all insurance or
other proceeds of the property and other collateral to which a security
interest is granted.  Lessor hereby
warrants and covenants to Lessee that Lessee shall and may quietly have hold
and enjoy the Equipment free from anyone claiming through Lessor.

9.              LAWS AND TAXES.  LESSEE SHALL COMPLY WITH ALL LAWS AND
REGULATIONS RELATING TO THE EQUIPMENT AND ITS USE AND SHALL PROMPTLY PAY WHEN
DUE ALL SALES, USE, PROPERTY, EXCISE AND OTHER TAXES AND ALL LICENSE AND
REGISTRATION FEES NOW OR HEREAFTER IMPOSED BY ANY GOVERNMENTAL BODY OR AGENCY
UPON THE EQUIPMENT OR ITS USE OR THE RENTALS HEREUNDER.  Lessee shall prepare and file all tax returns
relating to taxes for which Lessee is responsible hereunder which Lessee is
permitted to file under the laws of the applicable taxing jurisdiction.  Lessee agrees to indemnify and hold Lessor
and any Assignee (as defined below) harmless from, against and in respect of
any and all such taxes, with the exception of Lessors normal income taxes
associated with the Lease.

10.       TAX BENEFIT INDEMNITY.  If (a) Lessor incurs a disallowance,
elimination, recapture, reduction or disqualification, in whole or in part, or
any deduction, credit or other tax benefit claimed by Lessor for federal,
state, or local income tax purposes in any tax law change), (b) Lessor shall
lose the right to claim any Tax Benefit for any reason (including any tax law
change), (c) any tax law change should adversely affect Lessor’s anticipated
net after tax rate of return over the term of this Lease (any 

 

one or more of the
occurrences in (a), (b) or (c) above being hereafter called a “Tax Loss”),
then, upon demand by Lessor, the Lessee shall immediately pay to Lessor as
additional rent the amount which will (after deduction therefrom of all taxes,
interest, additions to tax or penalties that have been or will be required to
be paid by Lessor at the highest marginal corporate tax rate under all
applicable federal, state, and local laws), in Lessor’s reasonable opinion,
compensate Lessor for the Tax Loss.  In
any event, Lessees obligation shall be limited to 5% of the rent otherwise
payable to Lessor.

11.       INSPECTION.  With reasonable notice, Lessor shall have the
right during normal business hours to enter into and upon the premises where the
Equipment is located for the purpose of inspecting the same or observing its
use.

12.       ALTERATIONS.  Without the prior written consent of Lessor,
Lessee shall not make any alterations, additions or improvements to the
Equipment.  Any alteration, addition or
improvement shall become the property of Lessor and part of the Equipment for
all purposes hereunder.

13.       REPAIRS.  Lessee, at its own cost and expense, shall
keep the Equipment in good repair, condition and working order and shall
furnish or purchase any and all parts, mechanisms, devices and labor required
to keep the Equipment in good mechanical and working order.  If indicated on the applicable Lease
Schedule, Lessee shall at its own expense cause the Equipment to be covered by
a maintenance contract, with a service organization acceptable to Lessor, at
all times during the lease term and until the Equipment has been returned to
Lessor.

14.       LOSS OR DAMAGE.  From the date the supplier ships the
Equipment to Lessee or the date Lessor confirms Lessee’s purchase order or
contract to Supplier, Lessee hereby assumes and shall bear the entire risk of
loss for theft, damage, destruction or other injury to the Equipment from any
and every cause whatsoever.  NO SUCH LOSS
OR DAMAGE SHALL IMPAIR ANY OBLIGATION OF LESSEE UNDER THE LEASE WHICH SHALL
CONTINUE IN FULL FORCE AND EFFECT.  In
the event any item of Equipment shall become lost, stolen, destroyed, damaged
beyond repair or rendered permanently unfit for any reason, or in the event of
condemnation or seizure of the Equipment (or any part thereof) and irrespective
of payment from any insurance coverage maintained by Lessee, but applying full
credit there for, Lessee shall at the option of Lessor, (a) place the Equipment
in good repair, condition and working order and otherwise acceptable to Lessor;
or (b) replace the Equipment (or any part thereof) with like equipment having a
fair market value equal to that of the replaced equipment prior to it being so
affected and in good repair, condition and working order and transfer clear
title to such replacement equipment to Lessor whereupon such replacement
equipment shall be deemed the Equipment for all purposes; or (c) pay to Lessor
the following amounts: (i) if the Lease provides for a Casualty Loss Value of
the Equipment, the total rent due and owing at the time of such payment plus an
amount calculated by Lessor which is equal to the Casualty Loss Value as
defined in and attached to each Lease Schedule; (ii) if the Lease does not
provide for a Casualty Loss Value of the Equipment, not as a penalty, but
herein liquidated for all purposes, an amount equal to the sum of (A) any
accrued and unpaid rent as of the date the loss, theft, damage or destruction
occurred (“Date of Loss”) plus interest at the rate of eighteen percent (18%)
per annum; (B) the present value of all future rentals reserved in the Lease
and contracted to be paid over the unexpired term of the Lease using a discount
rate of six percent (6%) per annum; (C) the present value of the agreed upon or
estimated residual value of the Equipment as of the expiration of this Lease or
any renewal thereof using a discount rate of six percent (6%) per annum; and
(D) any other amount otherwise then due and owing under the Lease or which
otherwise will become due and owing irrespective of the fact that the Equipment
has been damaged, destroyed, lost or stolen including any additional taxes or
other charges that may otherwise arise by reason of the damage, destruction,
loss or theft of the Equipment.  Upon
Lessor’s receipt of such payment, Lessee shall be entitled to the proceeds of
any recovery in respect of any such item of Equipment from insurance or
otherwise to the extent that said proceeds do not exceed the Casualty Loss
Value of such item of Equipment, and any excess shall be retained by Lessor.

15.       DELIVERY AND ACCEPTANCE.  Unless otherwise provided in a Lease
Schedule, Lessee shall pay the cost of transportation of the Equipment to
Lessee.  Lessee shall bear the risk of
loss during such transportation.  Upon
delivery Lessee shall sign and deliver to Lessor an acceptance certificate
satisfactory to Lessor.

16.       LOCATION OF USE.  Unless otherwise stated on a Lease Schedule,
the Lessee will cause the Equipment subject to that Lease Schedule to be
located (after initial delivery to Lessee) at Lessee’s address stated at the
heading of this Agreement until such time as that Equipment is returned to
Lessor or returned in accordance with Lessor’s instructions.

17.       RETURN OF EQUIPMENT.  Upon the expiration of or earlier termination
of this Lease with respect to an item of Equipment, Lessee shall return the
same directly to Lessor at its offices in Minneapolis, Minnesota, or such other
location as Lessor designates, in good repair, condition and working order
(ordinary wear and tear resulting from proper use thereof alone excepted),
completed and ready for further use. 
Lessee shall pay all transportation and other expenses relating to such
return.  Lessee authorizes Lessor to sell
the Equipment while located upon Lessee’s premises.  In the event Lessee breaches this 

 

section, Lessor
may, in lieu of its other remedies, require Lessee to purchase the items of
Equipment as to which the breach as occurred on the same terms as if Lessee
were exercising an option to purchase such Equipment under this Master Lease Agreement
(and whether or not such an option was granted to Lessee).

18.       INSURANCE.  Lessee at its expense shall provide insurance
coverage in amounts and with insurance carriers acceptable to Lessor for all
risks of:  (a) loss, theft, damage or
destruction to the Equipment, with coverage not less than the original cost of
the Equipment (excluding depreciation); and (b) public liability and property
damage covering personal injuries, death or property damage resulting from the
ownership, maintenance, use, operation or transportation of the Equipment, with
coverage of not less than $1,000,000 per occurrence.  Each of the insurance policies providing said
coverage shall name Lessor and any Assignee as loss payee and additional insured,
provide that the policy may not be canceled or materially altered without
thirty (30) days prior written notice to Lessor, and be primary without right
of contribution from any insurance carried by Lessor.  Lessee shall, if requested by Lessor, provide
Lessor with a certificate(s) evidencing said coverage prior to taking
possession of the Equipment.  Lessee
hereby irrevocably appoints Lessor as Lessee’s attorney-in-fact, limited to a
time period in which Lessee is in default, to make claim for, receive payment
of, and execute and endorse all instruments, checks or drafts for loss or
damage or returned premium under any insurance policy of Lessee’s.

19.       INDEMNITY.  Lessee shall and does hereby agree to
indemnify, defend and hold harmless Lessor and any Assignee, and each of their
directors, officers, employees, agents or affiliates from any and all claims,
demands, actions, suits, proceedings, costs, expenses, damages, and liabilities
(including attorneys’ fees) arising out of, connected with or resulting from
the delivery, possession, use, operation, maintenance, repair or return of
Equipment by Lessee or its employees, agents, customers or invitees or
vendors.  Lessee’s obligations under the
preceding sentence shall survive expiration of any rental term or the
termination of the Lease.  Indemnity
shall not apply to occurrences that take place after the surrender and
acceptance of the equipment to Lessor.

20.       REPRESENTATIONS AND
WARRANTIES BY LESSEE.  Lessee
represents and warrants to Lessor that: 
(a) the Lease constitutes the Lessee’s legal, valid and binding
obligation and is enforceable against Lessee in accordance with its terms; (b)
Lessee’s entry into and performance under the Lease will not result in any
breach, default or violation under Lessee’s charter documents (articles of
incorporation and bylaws in the case of a corporation or partnership agreement
in the case of a partnership or articles of organization and operating
agreement in the case of a limited liability company) or any other agreement to
which Lessee is a party or to which it or its property is subject; (c) there
are no suits or proceedings pending or threatened before any court, government
agency or arbitrator which, if determined adversely to Lessee, would have a
material adverse effect on its financial condition or ability to perform its
obligations under the Lease; (d) that any financial statements or other
information which Lessee has furnished Lessor concerning the business or
condition of Lessee was true, correct and complete at the time furnished or as
of the date of such financial statements; (e) the Equipment shall remain
personal property; with respect to any Equipment that is the subject of any
sale and leaseback transaction pursuant hereto, Lessee has good title to, rights
in, and/or power to transfer all of the same. 
The Equipment is removable from and is not essential to the premises
upon which it is located regardless of its attachment to realty, and Lessee
agrees to take such action at its expense as may be necessary to prevent any
third party from acquiring any interest in the Equipment as a result of its
attachment to realty with respect to all of the Equipment leased hereto.

21.       FINANCIAL STATEMENTS.  Upon request by Lessor, Lessee will promptly
provide statements for its most recently completed fiscal year end or quarter
and any other financial information reasonably requested.

22.       ASSIGNMENT BY LESSOR.  Lessor may from time to time without notice
to Lessee sell, assign, pledge, transfer or convey to a third party (each an “Assignee”)
all or part of Lessor’s right, title and interest in the Lease, the Equipment,
or any sums payable therefor.  Lessor may
grant a security interest in the same to such Assignee as collateral security
for any loans or advances made or to be made to Lessor by such Assignee.  Lessee, upon receipt of notice of any such
transfer, assignment or security interest and instructions from Lessor shall
pay its obligations under the Lease to the Assignee (or to any other party
designated by the Assignee).  Upon any
such transfer, assignment or granting of a security interest by Lessor, Lessee’s
obligations hereunder with respect to Assignee, including, without limit, its
obligation to pay the Assignee rents and other sums due and to become due under
the Lease, shall be absolute and unconditional, and shall not be subject to any
abatement, reduction, recoupment, defense, offset or counterclaim for any
reason, including but not limited to any defect in the Equipment, the
condition, design, operation or fitness for use or any loss or destruction of
the Equipment or any part thereof, the prohibition of or other restriction
against Lessee’s use of the Equipment, the interference with such use by any
person or entity, any failure by Lessor to perform any of its obligations
herein contained, or any other cause, whether similar or dissimilar to the
foregoing.  Upon notice of any intended
transfer, assignment, or granting of a security interest: (a) Lessee shall
promptly submit to Lessor such documents as may be reasonably required by the
intended Assignee, in form and substance satisfactory to the intended Assignee,
including without limitation:  (1) a
certificate that the Equipment was delivered and accepted; (2) if 

 

Lessee is a
corporation, a certified copy of resolutions adopted by Lessee’s Board of
Directors authorizing execution of the Lease; (3) an acknowledgment to the
Lessor’s transfer, assignment or granting of a security interest; (4) a UCC
Financing Statement;  (b) in the event of
any such assignment, transfer, or granting of a security interest:  (1) Lessee shall send copies of any notices
which are required hereunder to be sent to Lessor to the Assignee as well as to
Lessor; (2) Lessee shall not permit the Lease to be amended or any provisions
thereof to be waived without the prior written consent of the Assignee; (3)
Lessee agrees not to look to the Assignee to perform any of Lessor’s
obligations hereunder; (4) Lessee agrees that Assignee shall be exclusively
entitled to all of the rights and remedies provided to the Lessor under the
Lease; (c) no such transfer, assignment or granting of a security agreement by
Lessor shall relieve Lessor of any of its obligations under the Lease or shall
limit Lessee’s rights to look to Lessor for the performance of such
obligations.

23.       ASSIGNMENT BY LESSEE.  LESSEE SHALL NOT ASSIGN, TRANSFER,
PLEDGE, OR HYPOTHECATE THE LEASE, THE EQUIPMENT OR ANY PART THEREOF, OR ANY
INTEREST THEREIN.  LESSEE SHALL NOT
SUBLET OR LEND THE EQUIPMENT, OR ANY PART THEREOF, OR PERMIT THE EQUIPMENT OR
ANY PART THEREOF TO BE USED BY ANYONE OTHER THAN LESSEE WITHOUT THE PRIOR
WRITTEN CONSENT OF LESSOR (OR FOLLOWING AN ASSIGNMENT, ANY ASSIGNEE OF WHICH
THE LESSEE HAS KNOWLEDGE OF) WHICH CONSENT WILL NOT BE UNREASONABLY WITHHELD.  If Lessee is a corporation or a partnership,
the change in ownership of 50% or more of the ownership interest in Lessee
during the term of the Lease without the written consent of Lessor constitutes
a prohibited assignment hereunder. 
Subject always to the foregoing, the Lease inures to the benefit of, and
is binding upon the heirs, legatees, personal representatives, successors, and
assigns of the parties hereto.  No sale,
assignment or sublease, whether authorized by Lessor or in violation of the
terms hereof, shall relieve Lessee of its obligations and Lessee shall remain
primarily liable hereunder and under each Lease Schedule.  Assigns shall become bound as a “new debtor”
to the Lease as set forth under UCC § 9-203(e). 
Lessor will consider such Assignment if the Assignee’s financial
condition is equal to or superior to that of Lessee as may be determined by
Lessor’s Chief Financial Officer and accountants.

24.       DEFAULT.  Any one of the following events shall
constitute an “Event of Default” hereunder: 
(a) Lessee shall fail to pay when due any installment of rent or other
amount due hereunder; (b) Lessee shall fail to observe or perform any other
agreement to be observed or performed by Lessee hereunder; (c) Lessee, any
guarantor of the Lease, or any partner of Lessee if Lessee is a partnership
shall cease doing business as a going concern or make an assignment for the
benefit of creditors; (d) Lessee, any guarantor of the Lease, or any partner of
Lessee if Lessee is a partnership shall voluntarily file, take any action to
authorize the filing, or have filed against it involuntarily, a petition for
liquidation, reorganization, adjustment of debt or similar relief under the
federal or state bankruptcy or insolvency law; (e) a trustee, receiver, or
liquidator be appointed for Lessee, any guarantor of the Lease, or for all or a
substantial part of the assets of Lessee or any guarantor; (f) any individual
Lessee or individual guarantor of the Lease, or partner of Lessee if Lessee is
a partnership, shall die; (g) an event of default shall occur under any other
obligation Lessee or any guarantor of the Lease owes to Lessor; (h) an event of
default by Lessee shall occur under any agreement involving Lessee’s or a
guarantor’s indebtedness to a lender for borrowed money; or (i) Lessee shall
have terminated its corporate existence, consolidated with, merged into, or
conveyed or leased substantially all of its assets as an entity to any person
unless:(i) such person executes and delivers to Lessor an agreement
satisfactory in form and substance to Lessor, in its sole discretion,
containing such person’s effective assumption and its agreement to pay,
perform, comply with and otherwise be liable for all of Lessee’s obligations
having previously arisen, or then or thereafter arising, under the Lease
together with any documents, agreements, certificates, opinions and filings by
Lessor; and (ii) Lessor (and any Assignee) is satisfied as to the
creditworthiness of such person.

25.       REMEDIES.  Upon the occurrence of an Event of Default
and at any time thereafter, Lessor or Assignee may exercise from time to time
any one or more of the following remedies: 
(a) terminate this Lease as to any portion or all of the Equipment; (b)
take immediate possession of any or all of the Equipment; wherever situated,
and for such purpose enter upon any premises without liability for so doing or
requirement to post bond in any legal proceeding; (c) hold, use, lease, sell or
otherwise dispose of any or all of the Equipment in such manner as Lessor in
its sole discretion may decide.  With
respect to any exercise of its rights to recover and/or dispose of any
Equipment, Lessee acknowledges and agrees that Lessor shall have no obligation,
subject to the requirements of commercial reasonableness, to clean up or
otherwise prepare the Equipment for disposition; (d) accelerate the due date of
all remaining rent payments due hereunder for the entire remaining Initial Term
of this Lease or any amendment thereto, including any renewal term then in
effect, whereupon said amounts shall be immediately due and payable; (e)
recover the sum of: (i) any accrued and unpaid rent, plus (ii) the present
value of all future rentals reserved in this Lease and contracted to be paid
over the unexpired Initial Term of this Lease (or any renewal period then in
effect), discounted at the rate of four percent (4%) per annum; plus (iii) the
anticipated residual value of the Equipment as of the expiration of this Lease
or any renewal thereof discounted at the rate of four percent (4%) per annum, (iv)
any indemnity payment, if then determinable; (v) all reasonable costs and
expenses incurred by Lessor in any repossession, recovery, storage, repair,
sale, re-lease or other disposition of the Equipment, including but not limited
to costs of transportation, possession, storage, refurbishing, advertising and
broker’s fees together with all attorney’s fees and cost incurred in connection
therewith or 

 

otherwise
resulting from Lessee’s default (including any incurred at trial, on appeal or
any other proceeding); and (vi) the value of all Tax Benefits lost to Lessor as
a result of Lessee’s default or the enforcement by Lessor of any remedy; plus
interest on each of the foregoing at the rate of one and one-half (11⁄2%) per
month (“default interest”) (f) expend such monies as Lessor deems appropriate
to cure or mitigate the effect of the Event of Default, or to protect the
Lessor’s interest in the Equipment and this Lease, with all such sums to be
immediately reimbursed to Lessor by Lessee; (g) setoff Lessee’s Security Deposit
or any other property of Lessee held by Lessor against any amount owed by
Lessee to Lessor; and (h) exercise any other remedy permitted by law, equity or
any other agreements with Lessee or any guarantor of this Lease.  No remedy given in this paragraph is intended
to be exclusive and each shall be cumulative. 
No express or implied waiver by Lessor of any Event of Default shall
constitute a waiver of any subsequent Event of Default.

26.       NOTICES.  Any written notices hereunder shall be deemed
to have been given when delivered personally or deposited in the United States
mails, postage prepaid, certified mail, return receipt requested, and if to
Lessee, mailed to its address set forth at the heading of this Agreement or to
such other address as may be last known to Lessor, and if to Lessor, addressed
to Carlton Financial Corporation, 1907 E. Wayzata Boulevard, Suite 180,
Wayzata, MN 55391 or such other address as Lessor may hereafter specify in a
written notice to Lessee.

27.       LABELING.  Lessee shall keep all Equipment free from any
marking or labeling which might be interpreted as a claim or ownership thereof
by Lessee or any party other than Lessor or anyone so claiming through
Lessor.  If Lessor requests Lessee shall
cause the Equipment to be plainly marked or tagged to indicate Lessor’s
interest in the Equipment.

28.       FURTHER ASSURANCES.  Lessee agrees to execute or otherwise
authenticate and deliver such other documents, records, financing statements or
instruments necessary to effect the transactions contemplated by this Lease or
requested by Lessor to document or protect Lessor’s ownership interest in the
Equipment.  Lessee authorizes Lessor to
file all documents (including all UCC financing statements and amendments
thereto) that Lessor deems necessary to perfect its interest in the Lease and
Equipment.  Lessee shall provide written
notice to Lessor not less than thirty (30) days prior to any contemplated
change in the name, jurisdiction of organization or address of the chief
executive officer of Lessee, or any change in its state organizational
identification number (if applicable).

29.       ENTIRE AGREEMENT.  The Lease shall not be amended, altered, or
changed, or any obligation hereunder waived, except by written agreement signed
by the parties hereto.  No agent or
employee of Lessor shall have the power to waive any of the terms or provisions
hereof, or to incur additional obligations on behalf of Lessor, unless such
waiver or additional obligations are evidenced by an agreement in writing
signed by a duly authorized officer of Lessor and by the Lessee.  No agent or employee of Lessor shall have the
authority to receive any payment of rentals or other sums accruing hereunder
except remittances made payable to the order of Lessor for purposes of forwarding
same to Lessor, and no agent or employee shall have any power to endorse for
collection or otherwise any of those remittances.

30.       SEVERABILITY.  If any provision of the Lease is held
invalid, that invalidity shall not affect the other provisions that can be
given without the invalid provisions, and to this end the provisions of the
Lease are declared to be severable.

31.       GOVERNING LAW; FORUM;
WAIVER OF JURY TRIAL.  This Lease
shall be deemed entered into in Minnesota and governed by the laws of the State
of Minnesota without regard to the conflicts of laws principal of that
state.  Lessor and Lessee hereby
irrevocably consent to the nonexclusive personal jurisdiction of and venue in
any United States or State of Minnesota court sitting in Minneapolis or St.
Paul, Minnesota over any dispute arising under or involving this Lease or any
guaranty of the Lessee’s obligations under the Lease.  LESSOR AND LESSEE EACH WAIVES ITS RIGHTS, IF
ANY, TO A JURY TRIAL.

32.       POWER OF ATTORNEY.  Lessee irrevocably authorizes and appoints
Lessor as its attorney in fact solely to complete, amend and execute on Lessee’s
behalf financing statements in connection with the Lease and to conform the
description of the property (including serial numbers) and any such financing statements
or other documentation.  Lessee will also
promptly execute and deliver to Lessor such further documents and take further
action as Lessor may request to more effectively carry out the intent and
purpose of the Lease.

IN WITNESS WHEREOF, the parties
hereunto set their hands as of the date first written above.

	
  LESSOR:

  	
  LESSEE:

  
	
  CARLTON FINANCIAL CORPORATION

  	
  GRANITE
  CITY FOOD & BREWERY LTD.

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ Cheryl VanBrunt

  	
   

  	
  By:

  	
  /s/ Steven J. Wagenheim

  	
   

  
	
   

  	
   

  
	
  Title:

  	
  Corporate Secretary

  	
   

  	
  Title:

  	
  President and Chief Executive Officer

  	
   

  
									

 

 

 

 

Exhibit A 

 

LEASE SCHEDULE 

 

	
  Master Lease Agreement dated:

  	
   

  	
  Lease Schedule No. 

  	
   

  	
   

  

 

	
  Lessor:

  	
   

  	
  Carlton Financial Corporation 

  
	
   

  	
   

  	
  1907 E. Wayzata Blvd., Suite 180

  
	
   

  	
   

  	
  Wayzata, MN 55391

  
	
   

  	
   

  	
   

  
	
  Lessee:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Supplier: 

  	
   

  	
  Various

  
	
   

  	
   

  	
   

  
	
  Description of Equipment:

  
	
   

  	
   

  	
   

  
	
  QUANTITY

  	
   

  	
  SERIAL NUMBER

  	
  TYPE & MODEL
  NUMBER

  
	
   

  	
   

  	
   

  	
   

  
						

 

Location of Equipment (if different from Lessee’s
address): 

 

	
  

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Total
  Cost

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  $

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Lease Commencement Date: 

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Schedule
  of Payments

  	
   

  	
  Total
  Basic Rent

  
	
   

  	
   

  	
   

  	
   

  	
  $

  

 

	
  Initial Term in months:  

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Initial Payment

  	
   

  	
  Basic Rental Payment

  	
   

  	
  Advanced
  Payment

  
	
  Rental Payment Period

  	
   

  	
  Due Date: UPON RECEIPT

  	
   

  	
  No.

  	
   

  	
  $

  
	
   

  	
   

  	
  Amount: $

  	
   

  	
  at: $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Due on the 1st of the month

  	
   

  	
  Security
  Deposit

  
	
   

  	
   

  	
  Plus applicable sales & use tax

  	
   

  	
  Plus applicable sales & use tax

  	
   

  	
  N/A

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  x
  Monthly

  	
   

  	
  o
  Annually

  	
   

  	
   

  	
   

  	
   

  
	
  o
  Quarterly

  	
   

  	
  o
  Other-see additional provisions

  
	
  o
  Semi-annually

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

ADDITIONAL
PROVISIONS: 

 

1.     INCORPORATION OF THE STANDARD TERMS AND
CONDITIONS.  This Lease Schedule
incorporates the terms and conditions of the Master Lease Agreement dated                            
between Lessor and Lessee.  Capitalized
terms used in this Lease Schedule and not otherwise defined shall have the
meanings ascribed thereto in the Master Lease Agreement. 

 

2.     ENTIRE AGREEMENT.  This Lease Schedule, together with the
incorporated terms and conditions contained in the Master Lease Agreement,
constitutes the entire agreement between Lessee and Lessor and supersedes all
prior and contemporaneous writings, understandings, and agreements.  No waiver, consent, modification or change of
terms of this Lease shall bind either party unless in writing signed by both
parties, and then such waiver, consent, modification, or change shall be
effective only in the specific instance and for the specific purpose
given.  Any terms and conditions of any purchase
order or other documents submitted by Lessee in connection with this Lease
which are in addition to or inconsistent with the terms and conditions of this
Lease will not be binding on Lessor and will not apply to this Lease.   

 

Lessee by the
signature below of its authorized representative acknowledges that it has read
this Lease Agreement, understands it, and agrees to be bound by its terms and
conditions. 

 

	
  DATED:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Lessor: Carlton Financial Corporation

  	
   

  	
  Lessee:

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
  Its:

  	
   

  	
   

  	
   

  	
  Its:

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