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Sample Business ContractsHome: Sample Business Contracts:
OFFICE BUILDING LEASE
WESTERN STATES VENTURES, LLC,
A CALIFORNIA LIMITED LIABILITY COMPANY,
AS "LANDLORD"
AND
ABACUS DIRECT CORPORATION,
A DELAWARE CORPORATION,
AS "TENANT"
MAY 22, 1998
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
1. PARTIES........................................................1
2. PREMISES.......................................................1
3. TERM...........................................................2
4. POSSESSION.....................................................3
5. RENT...........................................................5
6. SECURITY DEPOSIT...............................................5
7. OPERATING EXPENSE ADJUSTMENTS..................................5
8. USE............................................................9
9. COMPLIANCE WITH LAW...........................................10
10. ALTERATIONS AND ADDITIONS.....................................10
11. REPAIRS.......................................................12
12. LIENS.........................................................14
13. ASSIGNMENT AND SUBLETTING.....................................14
14. HOLD HARMLESS.................................................18
15. SUBROGATION...................................................19
16. LIABILITY INSURANCE...........................................19
17. SERVICES AND UTILITIES........................................20
18. PROPERTY TAXES................................................22
19. RULES AND REGULATIONS.........................................22
20. HOLDING OVER..................................................22
21. ENTRY BY LANDLORD.............................................23
22. RECONSTRUCTION................................................23
23. DEFAULT.......................................................24
24. REMEDIES IN DEFAULT...........................................25
25. EMINENT DOMAIN................................................27
26. ESTOPPEL CERTIFICATE..........................................28
27. PARKING.......................................................28
28. AUTHORITY OF PARTIES..........................................29
29. DEFAULT BY LANDLORD...........................................29
30. OPTION TO EXPAND..............................................31
31. FIRST RIGHT OF REFUSAL........................................32
32. FIRST RIGHT OF OFFER..........................................34
33. OPTION TO EXTEND..............................................34
34. HAZARDOUS MATERIALS...........................................36
35. GENERAL PROVISIONS............................................38
36. BROKERS.......................................................42
37. NOTICE........................................................42
</TABLE>
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<PAGE>
OFFICE BUILDING LEASE
(FOR USE IN THE STATE OF COLORADO)
1. PARTIES
This Office Building Lease ("LEASE"), dated for reference purposes only
May 22, 1998 ("LEASE DATE"), is entered into between WESTERN STATES
VENTURES, LLC, a California limited liability company (herein called
"LANDLORD"), and ABACUS DIRECT CORPORATION, a Delaware corporation
(herein called "TENANT").
2. PREMISES
(a) Landlord does hereby lease to Tenant and Tenant hereby
leases from Landlord that certain space (herein called "PREMISES"),
consisting of approximately seventy-five thousand (75,000) rentable
square feet, known as "SUITE 400," at the building ("BUILDING"),
located at [To Be Determined/bounded by Highway 128 and 120th Street],
Broomfield, Colorado, commonly known as "EL DORADO RIDGE," shown on
Exhibit A attached hereto and hereby made a part hereof, including the
Tenant Improvements ("TENANT IMPROVEMENTS") to be constructed in
accordance with the "WORK LETTER AGREEMENT" attached as Exhibit B
hereto. The Premises shall consist of the entire fourth, third, second
floor, and a portion of the first floor. Said Lease is subject to the
terms, covenants and conditions herein set forth and the Tenant
covenants as a material part of the consideration for this Lease to
keep and perform each and all of said terms, covenants and conditions
by it to be kept and performed and that this Lease is made upon the
condition of said performance. El Dorado Ridge is anticipated, upon
completion of construction, to have two (2) separate buildings, the
first, known as "BUILDING ONE," consisting of approximately one hundred
five thousand (105,000) rentable square feet, generally described in
Exhibit B-1 and the second, the Building referenced in this Lease. The
Building, Building One and the related common improvements are
collectively referred to as the "PROJECT."
(b) The demise of the Premises contained herein shall include
a non-exclusive right for Tenant to use all portions of the Building
and the common areas thereof designated by Landlord for the common use
of all tenants including, without limitation, hallways, restrooms,
stairs, entrances, lobby areas, elevators, parking spaces, driveways
and loading areas. Landlord shall not alter or reduce the common areas
or the Premises in a manner which unreasonably interferes with Tenant's
use or enjoyment of the Premises.
(c) Tenant acknowledges that, as of the Lease Date, Landlord
has not commenced construction of the Project, which construction is
anticipated to begin following the Lease Date when determined by
Landlord. In this regard, Landlord intends to complete construction of
the Building and Tenant Improvements in accordance with the provisions
of the Work Letter Agreement on or before the Expected Occupancy Date
(as hereinafter defined). Prior to the Commencement Date, Landlord
shall cause the Building to be measured to determine the rentable and
usable square footage of the Building and the Premises. Such
measurement shall be in compliance with the Building
<PAGE>
Owners and Managers Association Standard Method for Measuring Floor
Area within Office Buildings (ANSI Z65.1-1996). With regard to such
determination, Landlord agrees that a R/U ratio of 1.059% shall not be
exceeded for full floor occupancy, and a R/U ratio of 1.1284% shall not
be exceeded for partial floor occupancy. Landlord shall provide Tenant
with a written summary, certified by its architect, setting forth the
determination of the usable and rentable square footage of the Premises
prior to the Commencement Date consistent with the above-described
measurement standard, which measurement shall be binding and conclusive
upon the parties. Such measurements shall be confirmed in the First
Amendment to Lease and Acknowledgment (as hereinafter defined).
(d) As of the Commencement Date, Landlord represents and
warrants that the Building (excluding any areas within the Premises
constructed by and/or designed by Tenant), to the extent constructed by
Landlord, its agents, employees, contractors and/or subcontractors,
shall (i) comply with all applicable laws, and (ii) have been
constructed in accordance with the specifications for the Building
("BASE BUILDING SPECIFICATIONS") set forth in Exhibit B-2 attached
hereto.
3. TERM
This Lease is effective between Landlord and Tenant as of the Lease
Date. The term of this Lease shall commence upon the earlier of the
following dates ("COMMENCEMENT DATE"): (i) the date on which the
Premises are Substantially Completed (as defined below), which is
expected to be on April 1, 1999 ("EXPECTED OCCUPANCY DATE"); (ii) the
date on which the Premises would have been Substantially Completed had
there been no delays caused by or attributable to Tenant; or (iii) the
date upon which Tenant takes possession of the Premises with Landlord's
written consent. Notwithstanding the foregoing, excepting Tenant taking
possession of the Premises pursuant to subsection (iii) above prior to
April 1, 1999, in no event shall Tenant be required to take possession
of the Premises prior to (a) April 1, 1999, or (b) the date that the
lobby for the Building is substantially completed consistent with the
Lobby Specifications (as defined in the Work Letter Agreement). Within
thirty (30) days after the Commencement Date, Landlord and Tenant shall
execute and deliver an amendment to this Lease ("FIRST AMENDMENT TO
LEASE AND ACKNOWLEDGMENT") setting forth the Commencement Date and the
expiration date of the term of the Lease, the rentable area of the
Premises and adjustments to the Base Rent as a result of an increase or
decrease in the rentable area of the Premises which shall be in the
form attached hereto as Exhibit C. The Premises shall be deemed to be
"SUBSTANTIALLY COMPLETE" when (i) Tenant has direct access to the
Premises with building services ready to be furnished to Premises and
all construction to be performed by Landlord, as set forth in the Work
Letter Agreement has been completed, with the exception of the Punch
List Items (as hereinafter defined) that do not materially adversely
affect Tenant's use of the Premises as reasonably determined by
Landlord and Tenant, (ii) all major systems and services to be
furnished by Landlord pursuant to the provisions of the Lease are
operational, and (iii) a permanent certificate of occupancy has been
issued for the Premises. The term of this Lease shall be for a period
of seven (7) years following the
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Commencement Date. Landlord shall provide Tenant with its good faith
estimation of the date of the Commencement Date at least thirty
(30) days prior to such date.
4. POSSESSION
(a) If the Landlord, for any reason whatsoever, cannot cause
the Commencement Date to occur by the Expected Occupancy Date, this
Lease shall not be void or voidable, nor shall the expiration date of
the above term be in any way extended, but in that event, excepting
delays caused by Tenant, all rent shall be abated during the period
between the commencement of said term and the time When Landlord
delivers possession.
(b) In the event that Landlord shall permit Tenant to occupy
the Premises prior to the Commencement Date of the term, such occupancy
shall be subject to all the provisions of this Lease. In this regard,
Tenant shall be entitled to enter the Premises at least twenty (20)
days prior to the Commencement Date for the purpose of installation of
furniture, trade fixtures and equipment, which early occupancy shall be
subject to the terms and conditions of this Lease, excepting the
payment of Base Rent. The parties shall use their respective good faith
efforts to schedule work during such periods so as not to unreasonably
interfere with their respective efforts (the parties acknowledge that
such early entrance may be "Phased" concerning certain portions of the
Premises to allow for the laying of carpet therein). Said early
possession shall not advance the termination date hereinabove provided.
Additionally, subject to the provisions of this Section, Tenant shall
be provided access to the Premises by December 20, 1998, for the
purpose of constructing certain improvements in accordance with the
provisions of the Work Letter Agreement. In no event shall Tenant's use
of the Premises pursuant to this Section 4(b) be deemed to be Tenant's
acceptance of possession of the Premises or constitute the Commencement
Date.
(c) Tenant's taking possession of the Premises shall
constitute Tenant's acknowledgment that the Premises are in good
condition, and that Tenant agrees to accept the same in its condition
existing as of the date of such entry and subject to all applicable
municipal, county, state and federal statutes, laws, ordinances,
including zoning ordinances, and regulations governing and relating to
the use, occupancy or possession of the Premises, subject to the Punch
List Item (as hereinafter defined). Notwithstanding the foregoing,
within ten (10) days prior to and within sixty (60) days after the
Tenant takes possession of the Premises, Tenant shall deliver to
Landlord a list of items ("PUNCH LIST ITEMS") that Tenant reasonably
deems that Landlord complete or correct in order for the Premises to be
reasonably acceptable. The Punch List Items shall not include any
damages and/or repairs caused by Tenant, its agents, employees,
contractors or subcontractors. Landlord shall complete and/or correct
such items set forth on the Punch List Items using its good faith
efforts and due diligence within thirty (30) days following receipt of
the Punch List Items; provided, however, that with respect to those
items that Landlord reasonably contends do not require completion
and/or correction, Landlord and Tenant shall negotiate in good faith
for a resolution of such item. If Tenant does not deliver the Punch
List Items to Landlord within such time periods, Tenant shall be deemed
to have accepted the condition of the Premises.
3
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(d) For a period of one (1) year following the Commencement
Date ("WARRANTY PERIOD"), Landlord shall warranty the condition of the
Building and the Premises, to the extent that such improvements will be
constructed by Landlord, its agents, employees, contractors and
subcontractors. Following Landlord's receipt of written notice from
Tenant during the Warranty Period, Landlord shall use its commercially
reasonable efforts to complete such warranty repair in a timely basis
as soon as possible. Landlord's repair obligations pursuant to this
Section 4(d) shall be subject to Tenant's rights pursuant to Sections
11(d) and (3) of this Lease. The expiration of the Warranty Period
shall not otherwise affect Landlord's obligations to make certain
repairs as set forth in Section 11(b) of this Lease or effect the
enforcement of any applicable warranty provided by any third party
contractor or materialmen relating to the Building.
(e) Notwithstanding any other provision of Section 4 to the
contrary, in the event that the Commencement Date has not occurred on
or before May 7, 1999 ("OUTSIDE DELIVERY DATE"), for a period of five
(5) business days thereafter, as Tenant's sole and exclusive remedy
(except as set forth in this Section 4(e), Tenant shall have the right
to extend the date upon which Tenant is required to accept possession
of the Premises until October 1, 1999 ("DELAYED DELIVERY DATE"), by
delivery of written notice of such election within such time period;
provided, however, Tenant may accept possession of the Premises at any
time prior to the Delay Delivery Date, which acceptance would
accelerate the Commencement Date to the date of such acceptance. The
failure of Tenant to make such election within such time period shall
be deemed Tenant's waiver of such extension right. In the event that
Tenant makes such election to extend the Commencement Date of this
Lease until the Delayed Delivery Date, this Lease shall remain in full
force and effect, the Commencement Date shall be deemed the Delayed
Delivery Date, the expiration date of the Lease shall be
correspondingly extended, and, except as otherwise provided in this
Section 4(e), all terms and conditions of this Lease shall remain in
full force and effect. The parties acknowledge and agree that the
extension of the Commencement Date under the Delayed Delivery Date
shall cause a material financial impact upon Landlord, accordingly,
each party agrees to use its best commercially reasonable efforts to
cause the Commencement Date to occur on or before the Outside Delivery
Date. Subject to the preceding sentence, the parties acknowledge that
the reason for the delay of the Commencement Date past the Outside
Delivery Date is of material importance to the parties. The parties
hereby agree that in the event the Commencement Date is delayed past
the Outside Delivery Date due solely to delays caused by Landlord, its
agents, employees, contractors or subcontractors, provided that Tenant
has made the election to extend the Commencement Date until the Delayed
Delivery Date, as provided in this Section 4(e), in addition to any
Base Rent-free possession granted to Tenant pursuant to Section 5(b) of
this Lease, Tenant shall be entitled to thirty-seven (37) days of Base
Rent-free possession of the Premises beginning upon the sixty-first
(61st) day following the Commencement Date of this Lease, provided,
however, if Tenant accepts possession of the Premises within
thirty-seven (37) days following the Outside Delivery Date, such Base
Rent-free period shall be accordingly decreased. In the event that the
Commencement Date is delayed past the Outside Delivery Date for any
reason other than as set forth in the preceding sentence, which
includes, but is not limited to, any form of delay caused by reasons
beyond the
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control of Landlord or delays caused by Tenant, its agents, employees,
contractors or subcontractors, the granting of the Base Rent-free
period pursuant to the preceding sentence shall not be applicable.
(f) Notwithstanding any other provision of this Section 4 to
the contrary, in the event that the Commencement Date has not occurred
by November 15, 1999, for a period of fifteen (15) days thereafter,
Tenant shall have the right to terminate this Lease by delivery of
written notice to Landlord, in which case the parties shall have no
further obligations under this Lease. The failure of Tenant to deliver
such notice within such time period shall be deemed a waiver of such
right to terminate.
5. RENT
(a) Tenant agrees to pay to Landlord as "BASE RENT," (annual
rent divided by twelve (12)), without offset, prior notice or demand,
for the Premises, on or before the first day of the first full calendar
month of the term hereof following the Commencement Date and a like sum
on or before the first day of each and every successive calendar month
thereafter during the term hereof. Base Rent for any period during the
term hereof which is for less than one (1) month shall be a prorated
portion of the monthly installment herein, based upon the actual number
of days in such month. Said rental shall be paid to Landlord, without
deduction or offset in lawful money of the United States of America,
which shall be legal tender at the time of payment at the Office of the
Building, or to such other person or at such other place as Landlord
may from time to time designate in writing.
(b) The Base Rent during the term of this Lease shall be as
follows:
<TABLE>
<CAPTION>
Annual Base Rent
Term of this Lease (per rentable
(from Commencement Date) square foot)
------------------------------------------------------------------ ----------------
<S> <C>
Months 1 and 2 (first sixty (60)) days following Commencement Date $0.00
Months 3 through 42 $15.47
Months 43 through 84 $16.55
</TABLE>
(c) Any and all amounts due and payable by Tenant and Landlord
pursuant to this Lease, including, but not limited to Base Rent, shall
be referred to as "RENT."
6. SECURITY DEPOSIT
(None)
7. OPERATING EXPENSE ADJUSTMENTS
(a) For the purpose of this Lease, "DIRECT EXPENSES" shall
mean all direct costs of every kind or nature which Landlord shall pay
or become obligated to pay because of or in connection with management,
ownership, maintenance, repair,
5
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replacement, preservation and operation of the Building and the common
areas thereof (various Project expenses, which are common to both the
Building and Building One shall be included within Direct Expenses on a
pro rata basis (e.g. maintenance and cleaning of parking areas)), as
determined by standard accounting practices, calculated, with regard to
Direct Expenses which vary with occupancy only, assuming the Building
is ninety-five percent (95%) occupied, and shall include the following
costs by way of illustration, but not to be limited to: real property
taxes, assessments, bonds (or any substitute therefor) rent taxes,
gross receipt taxes (whether assessed against the Landlord or assessed
against the Tenant and collected by the Landlord, or both
(collectively, "REAL ESTATE TAXES")); the establishment of normal and
customary reasonable annual reserves for capital improvements and
structural repairs; water and sewer charges; insurance premiums for any
form of insurance deemed reasonably prudent by Landlord ("INSURANCE"),
provided that (i) such Insurance is in a form and amounts that other
landlords of comparable first-class buildings in the vicinity of the
Building are requiring, and (ii) such Insurance is actually purchased;
utilities of all types servicing the Building and the common areas
("UTILITIES") (electricity servicing the Premises is being paid by
Tenant directly to the utility provider, accordingly, such cost shall
not be included in Direct Expenses); janitorial services in accordance
with the specification set forth in Exhibit D attached hereto
("JANITORIAL SERVICES"); labor; costs incurred in the management of the
Building, if any; air conditioning and heating; elevator maintenance;
supplies; materials; equipment and tools; including maintenance, costs,
and upkeep of all parking and common areas (Direct Expenses shall not
include depreciation on the Building of which the Premises are a part
or equipment therein, loan payments, executive salaries or real estate
brokers' commissions, or cost of tenant improvements installed by
Landlord; or attorneys' fees incurred by Landlord resulting from
disputes or lease transactions with existing tenants of the Building;
provided that attorneys' fees incurred by Landlord which are for the
general benefit of all tenants of the Building shall be included in
Direct Expenses; and any expenses concerning the repair of defects in
the Building which are covered by and corrected pursuant to
manufacturer warranties). For the purposes of determining Tenant's
Share (as hereinafter defined) of Direct Expense, from calendar year to
calendar year during the term of this Lease, Landlord and Tenant agree
that increases in Direct Expenses, excepting the cost of Real Estate
Taxes, Insurance and Utilities, shall not exceed the Direct Expense Cap
(as defined below). The Direct Expense CAP shall not apply to Tenant's
Share of the cost of Real Estate Taxes, Insurance, and Utilities, which
costs shall be billed at actual cost and Tenant shall be responsible
for Tenant's Share of such costs. For the purpose of this Section 7(a),
"DIRECT EXPENSE CAP" shall mean (i) for the first (1st) year of the
term of this Lease, the amount of Five and 25/100ths Dollars ($5.25)
per rentable square foot of the Premises; (ii) for second (2nd) year of
the term of this Lease, the lesser of (a) the actual amount of Direct
Expenses, less Real Estate Taxes, Insurance, and Utilities, paid by
Landlord for the immediately preceding calendar year multiplied by one
hundred five percent (105%), or (b) the amount of Five and 51/100ths
Dollars ($5.51) per rentable square foot of the Premises; (iii) for
third (3rd) year of the term of this Lease, the lesser of (a) the
actual amount of Direct Expenses, less Real Estate Taxes, Insurance,
and Utilities, paid by Landlord for the immediately preceding calendar
year multiplied by one hundred five percent (105%), or (b) the amount
of Five and 79/100ths Dollars ($5.79) per
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rentable square foot of the Premises; (iv) for fourth (4th) year of the
term of this Lease, the lesser of (a) the actual amount of Direct
Expenses, less Real Estate Taxes, Insurance, and Utilities, paid by
Landlord for the immediately preceding calendar year multiplied by one
hundred five percent (105%), or (b) the amount of Six and 08/100ths
Dollars ($6.08) per rentable square foot of the Premises; (v) for fifth
(5th) year of the term of this Lease, the lesser of (a) the actual
amount of Direct Expenses, less Real Estate Taxes, Insurance, and
Utilities, paid by Landlord for the immediately preceding calendar year
multiplied by one hundred five percent (105%), or (b) the amount of Six
and 38/100ths Dollars ($6.38) per rentable square foot of the Premises;
(vi) for sixth (6th) year of the term of this Lease, the lesser of (a)
the actual amount of Direct Expenses, less Real Estate Taxes,
Insurance, and Utilities, paid by Landlord for the immediately
preceding calendar year multiplied by one hundred five percent (105%),
or (b) the amount of Six and 70/100ths Dollars ($6.70) per rentable
square foot of the Premises; and (vii) for seventh (7th) year of the
term of this Lease, the lesser of (a) the actual amount of Direct
Expenses, less Real Estate Taxes, Insurance, and Utilities, paid by
Landlord for the immediately preceding calendar year multiplied by one
hundred five percent (105%), or (b) the amount of Seven and 04/100ths
Dollars ($7.04) per rentable square foot of the Premises.
Notwithstanding the definition of Direct Expenses, such expenses shall
not include the costs set forth in Exhibit E.
(b) For the first year following the Commencement Date,
Landlord estimates such amount of Direct Expenses for the Building to
be Five and 25/100ths Dollars ($5.25) per rentable square foot, however
actual expenses may vary (the parties acknowledge that such estimate
has been decreased by $1.00 per rentable square foot in recognition of
Tenant's obligation to pay electrical services for the Premises
directly to the utility provider). Tenant shall pay its proportionate
share of Direct Expenses ("TENANT'S SHARE"), as determined by comparing
the rentable square footage of the Premises to the rentable square
footage of the Building, which percentage shall be confirmed in the
First Amendment to Lease and Acknowledgment. Landlord shall give to
Tenant on or before the first day of March of each year a statement
("EXPENSE STATEMENT") of the actual amount of Direct Expenses for the
previous year, but failure by Landlord to give such statement by said
date shall not constitute a waiver by Landlord of its right to collect
any amount payable hereunder. Landlord shall, in each Expense
Statement, estimate Direct Expenses for the then current year and such
estimate shall be used as an estimate for said current year and this
amount shall be divided into twelve (12) equal monthly installments and
Tenant shall pay to Landlord, concurrently with the regular monthly
rent payment next due following the receipt of such statement, an
amount equal to one (1) monthly installment multiplied by the number of
months from January in the calendar year in which said statement is
submitted to the month of such payment, both months inclusive.
Subsequent installments shall be payable concurrently with the regular
monthly rent payment for the balance of that calendar year and shall
continue until the next Expense Statement is rendered. If the next or
any succeeding year results in an increase in Direct Expenses, then
upon receipt of an Expense Statement from Landlord, Tenant shall pay a
lump sum equal to Tenant's Share of such total increase in Direct
Expenses, less the total of the monthly installments of Direct Expenses
paid in the previous calendar year. If, in any comparison year the
Tenant's Share of Direct Expenses be less than the preceding year, then
upon receipt of the Expense Statement, any overpayment made by Tenant
on the monthly installments basis provided above shall be
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<PAGE>
credited towards the next monthly rent falling due and the estimated
monthly installment of Direct Expenses to be paid shall be adjusted to
reflect such lower Direct Expenses.
(c) Even though the term has expired and Tenant has vacated
the Premises, when the final determination is made of Tenant's Share of
Direct Expenses for the year in which this Lease terminates, Tenant
shall, within thirty (30) days following such determination, pay any
increase due over the estimated expenses paid and conversely any
overpayment made in the event said expenses decrease shall be
immediately rebated by Landlord to Tenant. Notwithstanding anything
contained in this Article, the rent payable by Tenant shall in no event
be less than the rent specified in Article 5 hereinabove.
(d) For a period of one (1) year after receipt of the Expenses
Statement, Tenant shall be entitled, upon thirty (30) days prior
written notice and during normal business hours, at the office of the
Building's property manager or such other place as Landlord shall
designate, to inspect and examine those books and records of Landlord
relating to the determination of Direct Expenses for the immediately
preceding comparison year. Failure of Tenant to request such inspection
within such time period shall render such Expenses Statement conclusive
and binding on Tenant. If, after inspection and examination of such
books and records, Tenant disputes the amounts of the Direct Expenses
charged by Landlord, Tenant may, by written notice to Landlord, request
an independent audit of such books and records. The independent audit
of the books and records shall be conducted by either a qualified
expense auditor (with not less than ten (10) years experience in
auditing of commercial office projects, or a certified public
accountant ("AUDITOR")) acceptable to both Landlord and Tenant (the
Auditor shall be paid on an hourly basis and no contingent fee payments
shall be permitted). The audit shall be limited to the determination of
the amount of Direct Expenses for the subject comparison year. If the
audit discloses that the amount of Direct Expenses billed to Tenant was
incorrect, the appropriate party shall pay to the other party the
deficiency or overpayment, as applicable. All costs and expenses of the
audit shall be paid by Tenant unless the audit shows that Landlord
overstated Direct Expenses for the subject comparison year by more than
five percent (5.00%), in which case Landlord shall pay all costs and
expenses of the audit. Tenant and the Auditor shall keep any
information gained from such audit confidential and shall not disclose
it to any other party. The exercise by Tenant of the audit rights
hereunder shall not relieve Tenant of its obligation to timely pay all
sums due hereunder, including, without limitation, the disputed portion
of Direct Expenses.
(e) Upon not less than sixty (60) days advance written notice,
Tenant shall have the right to assume from Landlord responsibility to
provide Janitorial Services for the Leased Premises; provided that (i)
Tenant is not in default of the provisions of this Lease, and (ii) the
level of such service shall comply with the specifications set forth on
Exhibit D attached hereto. In the event that Tenant elects to assume
the obligation to provide Janitorial Services as provided herein,
Landlord shall have no obligation or liability as a result of actions
taken by such janitorial staff, Tenant shall cause such janitorial
staff to comply with the rules and regulations of the Building, such
services shall be consistent with the operation of other first-class
office building in the vicinity of
8
<PAGE>
the Building, and such expense previously included in Direct Expenses
shall be excluded for the purpose of determining Tenant's Share
thereof.
(f) At any time during the term of this Lease, Tenant may
request Landlord, by delivery of written notice, to challenge the
amount of Real Estate Taxes currently assessed against the Building;
provided, however, Landlord shall not be obligated to commence such
challenge if, in Landlord's good faith estimation, such challenge would
not prevail. If Landlord indicates in writing that it will not commence
such challenge, Tenant, at Tenant's sole cost and expense, shall have
the right to challenge the amount of the Real Estate Taxes with the
appropriate governmental entities; provided that Tenant shall
indemnify, defend and hold Landlord and the Property harmless from any
and all claims, damages and expenses resulting from such action. To the
extent that Tenant is successful in such challenge, Landlord shall
reimburse Tenant for its costs incurred in prosecuting such challenge
to the extent of Landlord's savings in Real Estate Taxes.
8. USE
(a) Tenant shall use the Premises for general office purposes
and related uses, and shall not use or permit the Premises to be used
for any other purpose. Subject to the provisions of this Lease, Tenant
shall be entitled to twenty-four (24) hours a day, seven (7) days a
week, three hundred sixty-five (365) days a year access to the
Premises.
(b) Except for permissible use of the Premises as set forth in
this Lease, Tenant shall not do or permit anything to be done in or
about the Premises nor bring or keep anything therein which will in any
way increase the existing rate of or affect any fire or other insurance
upon the building or any of its contents, or cause cancellation of any
insurance policy covering said Building or any part thereof or any of
its contents. Excepting the use of the Premises as permitted in Section
8(a), Tenant shall not do or permit anything to be done in or about the
Premises which will in any way obstruct or interfere with the rights of
other tenants or occupants of the Building or injure or annoy them or
use or allow the Premises to be used for any immoral or unlawful
purpose, nor shall Tenant cause, maintain or permit any nuisance in, on
or about the Premises. Tenant shall not commit or suffer to be
committed any waste in or upon the Premises.
(c) Neither Tenant, nor any assignee, sublessee or occupier of
any portion of the Premises, shall permit the introduction, placement,
use, generation, manufacture, storage, disposal or transportation in or
around the Premises of any hazardous, poisonous or toxic substance,
material or waste of any kind that may be hazardous to health and/or
the environment, including, without limitation, substances from time to
time identified as such by federal and/or state laws and regulations,
without the prior written consent of Landlord; provided, however,
Tenant shall be entitled to possess and maintain within the Premises
reasonable amounts of such hazardous materials which are customarily
used in connection with general office uses.
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9. COMPLIANCE WITH LAW
Tenant shall, at its sole cost and expense, promptly comply with all
laws, statutes, ordinances and governmental rules, regulations or
requirements now in force or which may hereafter be in force, which
includes, but is not limited to access laws for individuals with
disabilities (commonly referred to as "ADA"), and with the requirements
of any board of fire insurance underwriters or other similar bodies now
or hereafter constituted, relating to, or affecting the condition, use
or occupancy of the Premises, excluding structural changes not related
to or affected by Tenant's improvements or acts. In the event
additions, alterations or other accommodations to the Premises, the
Building, or any other property owned by Landlord are required as a
result of Tenant's occupancy or actions, Tenant shall be solely
responsible for and shall indemnify, defend and hold harmless Landlord,
its successors and assigns, for, from and against any loss, damage,
cost, claim, expense, or liability directly or indirectly arising out
or attributable to such occupancy or action. Subject to the foregoing,
Landlord, following the Commencement Date, shall be responsible for
compliance with all laws, statutes, ordinances and governmental rules,
regulations or requirements affecting the Building, including ADA, to
the extent that such compliance is required for general office use and
not related to Tenant's specific use of the Premises. The judgment of
any court of competent jurisdiction or the admission of Tenant in any
action against Tenant, whether Landlord be a party thereto or not, that
Tenant has violated any law, statue, ordinance or governmental rule,
regulation or requirement, shall be conclusive of the fact as between
the Landlord and Tenant.
10. ALTERATIONS AND ADDITIONS
(a) Tenant shall not make or suffer to be made any
alterations, additions, or improvements (collectively, "ALTERATIONS")
to or of the Premises, or any part thereof, without first obtaining the
written consent of Landlord, which shall not be unreasonably withheld;
provided, however, if the Alterations would adversely affect the
structure or safety of the Building or its electrical, plumbing, HVAC,
mechanical or safety systems, or if such Alterations would create an
obligation on Landlord's part to make modifications to the Building,
Landlord may withhold its consent in its sole and absolute discretion.
Notwithstanding the foregoing, without the prior consent of Landlord,
but with the prior notice to Landlord, Tenant shall be entitled to make
Alterations within the Premises, provided that (i) the cost of
construction such Alterations does not exceed Twenty-Five Thousand and
No/100ths Dollars ($25,000,00) per project In the aggregate, and (ii)
does not effect the structure or mechanical systems of the Building,
(iii) such Alterations are not visible from outside of the Premises,
and (iv) Tenant otherwise complies with the provisions of this Section
(collectively, "PERMITTED ALTERATIONS"). All Alterations shall comply
with all applicable laws, statutes and ordinances, which include, but
are not limited to ADA (Tenant acknowledges that certain Alterations
may require ADA compliance within the Premises, the Building, and the
common areas thereof, which costs may be disproportionate to the cost
of such Alteration). Any Alterations to or of said Premises, including,
but not limited to, wall covering, paneling, and built-in Landlord
shall provide written notice to Tenant prior to the construction of
such Alteration whether Tenant will be required to remove such
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Alteration and restore the Premises to its original condition upon the
expiration of the Term, normal wear and tear excepted (Tenant shall
have no obligation to remove any improvements constructed and/or
installed within the Premises pursuant to the provisions of the Work
Letter Agreement). If Landlord so states, Tenant, at its own cost shall
restore the Premises to its original condition upon the expiration of
the term; provided, however, Landlord may subsequently require any
Permitted Alterations be removed at the expiration or the earlier
termination of the term of this Lease. Upon Landlord's approval of the
requested Alterations, Tenant shall secure all necessary permits after
approved by Landlord, if applicable. Before Landlord's consent to such
Alterations, Tenant shall submit detailed specifications, floor plans
and necessary permits (if applicable) to Landlord for review. In no
event shall any Alterations affect the structure of the Building or its
facade. As a condition to its consent, Landlord may request adequate
assurance that all contractors who will perform such work have in force
workman's compensation and such other employee and public liability
insurance as Landlord deems necessary, and where the Alterations are
material, Landlord may require Tenant or its contractors to post
adequate completion and performance bonds. In the event Landlord
consents to the making of any Alterations to the Premises by Tenant,
the same shall be made by Tenant at Tenant's sole cost and expense,
completed to the satisfaction of Landlord, and the contractor or person
selected by Tenant to make the same must first be approved in writing
by Landlord. If Tenant makes any Alterations to the Premises as
provided in this Section, the Alterations shall not be commenced until
ten (10) business days after Landlord has received notice from Tenant
stating the date the installation of the Alterations is to commence so
that Landlord can post and record an appropriate notice of
nonresponsibility. Tenant shall reimburse Landlord for any reasonable
expenses incurred by Landlord in connection with the Alterations made
by Tenant, including any reasonable fees charged by Landlord's
contractors or consultants to review plans and specifications prepared
by Tenant, and the customary and reasonable cost of updating the
existing as-built plans of the Building to reflect the alterations.
Tenant shall indemnify, defend and hold the Landlord, the Building and
the Premises free and harmless from any liability, loss, damage, cost,
attorneys' fees and other expenses incurred on account of such
construction, or claims by any person performing work or furnishing
materials or supplies for Tenant or any persons claiming under Tenant.
(b) Landlord acknowledges that Tenant desires to cause the
elevator service to the floors of the Premises which Tenant entirely
occupies (second, third and fourth floor) to be assessable by Tenant
key cards only. Landlord, in accordance with any request by Tenant for
such modification to the elevator service, shall review and approve or
disapprove, which approval shall not be unreasonably withheld, such
request in accordance with the provisions of Section 10(a) above.
(c) Landlord acknowledges that Tenant may desire to have
certain underground easements for cabling purposes and pipe chase space
and conduits for telecommunication cabling and fiber optics within
certain areas of the Building, as well as use certain portions of the
roof as an observation deck and the location for up to four (4)
telecommunication devices at designated areas of the roof. Subject to
Tenant's obligation to pay for all such cost of installation,
maintenance, repair and damages caused by such use and operation,
Landlord agrees to review and approve or disapprove, which
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approval will not be unreasonably withheld, any such request in
accordance with the procedure set forth in Section 10(a) above.
Landlord further acknowledges that Tenant's business operations
contemplate the use of sophisticated telecommunications requirements,
which may require the installation of the items identified in this
Section 10(c) and, based upon such understanding, Landlord shall
reasonably review any related request for Alterations. Tenant shall not
be charged additional cost and/or rent for such usages.
11. REPAIRS
(a) Tenant shall, when and if needed or whenever requested by
Landlord to do so, at Tenant's sole cost and expense, maintain and make
all repairs to the Premises and every part thereof, including all
interior windows and doors, to keep, maintain and preserve the Premises
in good condition and repair. Tenant shall upon the expiration or
sooner termination of the term hereof surrender the Premises to
Landlord in the same condition as when received, less reasonable wear
and tear and subject to any damages which are not the obligation of
Tenant to repair pursuant to the provisions of this Lease. Tenant
acknowledges that Landlord shall have no obligation to maintain, repair
or replace any telecommunications or computer cabling or wiring which
is located in the Premises or which exclusively serves the Premises
(collectively, "CABLING"). Landlord shall have no obligation to alter,
remodel, improve, repair, decorate or paint the Premises or any part
thereof and the parties hereto affirm that Landlord has made no
representations to Tenant respecting the condition of the Premises or
the Building, except as specifically herein set forth. Tenant shall not
commit or allow any waste or damage to be committed in any portion of
the Premises or Building.
(b) Notwithstanding Subparagraph 11(a) above, Landlord shall
repair and maintain in good condition the structural portions of the
Building, including the roof, basic plumbing, heating, ventilating, air
conditioning, exterior windows, exterior walls of the Building,
exterior doors to the Building, all plumbing in bathrooms used in
common with other tenants of the Building, landscaping of the common
areas of the Building, the parking facilities of the Building,
electrical systems installed or furnished by Landlord (collectively,
"LANDLORD REPAIRS"), unless such maintenance and repairs are caused in
part or in whole by the act, neglect, fault of or omission of any duty
by Tenant, its agents, servants, employees or invitees, in which case
Tenant shall pay to Landlord, as additional rent, the reasonable cost
of such maintenance and repairs. Landlord shall not be liable for any
such failure to make any such repairs or to perform any maintenance,
unless such failure shall persist for an unreasonable time after
written notice of the need of such repairs or maintenance is given to
Landlord by Tenant. Following Landlord's receipt of written notice from
Tenant that a repair contemplated by this Section is required, Landlord
shall use its commercially reasonable efforts to complete such repair
in a timely basis as soon as possible. Except as provided in paragraph
22 hereof, there shall be no abatement of rent and no liability of
Landlord by reason of any injury to or interference with Tenant's
business arising from the making of any repairs, alterations or
improvements in or to any portion of the Building or the Premises or in
or to fixtures, appurtenances and equipment therein. Tenant waives the
right to make repairs at Landlord's expense under any law, statute or
ordinance now or hereinafter in effect.
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(c) Notwithstanding anything to the contrary contained in
subparagraphs (a) and (b) of this paragraph 11, Tenant shall maintain
and repair, at its sole cost and expense, all non-base Building
facilities, if any, including kitchen facilities and heating and air
conditioning systems, and all plumbing connected to said facilities or
systems, installed by Tenant or on behalf of Tenant. The provisions of
this paragraph shall not apply to the basic heating and air
conditioning system provided by Landlord to all tenants of the
Building.
(d) Notwithstanding any other provisions of this Lease to the
contrary, upon receipt of written notice (the "FIRST REPAIR NOTICE")
from Tenant that Landlord Repairs are required, Landlord shall cause
such repair to be made within a reasonable period of time given the
circumstances but in no event later than thirty (30) days after it
receives the First Repair Notice; provided, however, that if the repair
is of such a nature that it cannot be completed within thirty (30) days
(which fact shall be indicated in writing delivered to Tenant by
Landlord), then such longer time as reasonably necessary. If Landlord
fails to make the repair within the said time period, Tenant may give
an additional notice (the "SECOND REPAIR NOTICE") to Landlord. If
Landlord fails to commence thereafter such repair with five (5) days
after receipt of the Second Repair Notice and thereafter diligently
pursues said repair to completion, Tenant may perform such repair. All
repairs performed by Tenant pursuant to this Section shall be made by a
qualified licensed contractor(s) with sufficient expertise in such
matters and in accordance with all applicable laws, statutes and
ordinances. Landlord shall reimburse Tenant for Tenant's actual costs
incurred within ten (10) days after Landlord's receipt of a written
demand from Tenant, which demand shall include supporting invoices. If
Landlord disputes the need for such repair, Landlord shall deliver
written notice of such disagreement to Tenant within ten (10) days
after its receipt of the First Repair Notice. Notwithstanding such
dispute, Tenant may cause such repair to be completed pending
resolution of such dispute. The dispute shall be resolved by a mutually
acceptable third party engineer, which determination shall be binding
upon Landlord and Tenant; provided, however, that if the parties cannot
agree on an engineer, then the dispute shall be resolved by arbitration
pursuant to the commercial arbitration rules then in effect for the
American Arbitration Association ("ARBITRATION"). The losing party
shall pay the costs of the engineer or arbitrator, whichever is
applicable. If Landlord is obligated to reimburse Tenant for the actual
cost of repair and fails to do so as provided in this Section, such
amount shall accrue interest at the rate of fifteen percent (15.00%)
per annum until paid in full. If such amounts owing from Landlord to
Tenant are not paid within thirty (30) days following the due date of
such payment, Tenant shall have abatement rights as set forth in
Section 29(f) of this Lease.
(e) Landlord acknowledges that certain of the Landlord Repairs
may have to be made on an expedited basis due to a material disruption
of Tenant's business operations caused by such condition, which
condition shall be referred to as an "EMERGENCY CONDITION." In this
regard, in the event an Emergency Condition relating to a Landlord
Repair exists, Tenant shall deliver to Landlord, by facsimile, a
written notice ("EMERGENCY NOTICE") describing such Emergency
Condition. The Emergency Notice shall, in ten (10) point bold typed
across the top, stating "AN EMERGENCY SITUATION EXISTS AT THE PREMISES
REQUIRING YOUR
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IMMEDIATE ATTENTION." In the event that Landlord fails to commence
repair of the Emergency Condition within twenty-four (24) hours (if
such situation occurs during non-business hours, Tenant shall utilize
Landlord's paging system, the procedure for which shall be provided to
Tenant prior to the Commencement Date), Tenant using licensed
contractors which are qualified to perform such tasks in compliance
with applicable laws, shall have the right to make the Landlord
Repairs; provided, however, such repairs shall be limited to the
temporary remediation of such Emergency Condition and Landlord shall
thereafter be responsible for the full repair of such condition.
Landlord shall reimburse Tenant's actual expenses incurred in making
such temporary remediation repairs within ten (10) days following
Landlord's receipt of written demand and supporting invoices. If such
repayment is not made within such ten (10) day period, such amount
shall accrue interest at the rate of fifteen percent (15.00%) per annum
until paid in full. If such amounts owing from Landlord to Tenant are
not paid within thirty (30) days following the due date of such
payment, Tenant shall have abatement rights as set forth in Section
29(f) of this Lease.
12. LIENS
Tenant will not cause or permit any lien to be imposed upon the
Premises of the Building and will pay all taxes and license fees
imposed by reason of any improvements made by Tenant to the Premises or
imposed upon any personal property located in the Premises. Tenant
shall have the right to contest any such lien; provided that Tenant
posts the requisite bonds, which are upon terms and conditions
reasonably acceptable to Landlord, to remove such lien as an
encumbrance against the Building. Tenant shall provide Landlord with
prior written notice of any such intention to contest. Tenant agrees to
give Landlord not less than five (5) days notice prior to commencement
of any alteration or repair permitted under the terms of the Lease so
that Landlord may post a notice of non-responsibility. In the event
that the amount of the estimated cost of any improvements, additions or
alterations in the Premises is in excess of One Hundred Thousand and
No/100ths Dollars ($100,000.00), Landlord may require, at Tenant's sole
cost and expense, a lien and completion bond in an amount equal to one
and one-half (1-1/2) times all estimated cost of any improvements,
additions or alterations in the Premises, to insure Landlord against
any liability for mechanics' and materialmen's liens and to insure
completion of the work; provided that the provisions of this sentence
shall not apply to any improvements constructed by Tenant within the
Premises prior to the Commencement Date.
13. ASSIGNMENT AND SUBLETTING
(a) Tenant shall not, without the prior written consent of
Landlord, which shall not be unreasonably withheld, delayed or
conditioned, as provided in this Section 13: (a) assign, mortgage,
pledge, encumber or otherwise transfer this Lease, the term or estate
hereby granted, or any interest hereunder; (b) permit the Premises or
any part thereof to be utilized by anyone other than Tenant (whether as
concessionaire, franchisee, licensee, permittee or otherwise); or (c)
except as hereinafter provided, sublet or offer or advertise for
subletting the Premises or any part thereof. Any assignment, mortgage,
pledge, encumbrance, transfer or sublease without Landlord's consent
shall be voidable.
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Notwithstanding the foregoing and Subsection (b) below, Tenant may
assign this Lease or sublet the Premises or a portion thereof, without
Landlord's consent, but with prior written notice, to any corporation,
partnership, individual or other entity which controls, is controlled
by or is under common control with Tenant; or to any corporation,
partnership, individual or other entity, resulting from the merger or
consolidation with Tenant; or to any person or entity which acquires
all of the assets of Tenant's business going concern, provided that (i)
the assignee or subtenant assumes, in full, the obligations of Tenant
under this Lease, (ii) Tenant remains fully liable under this Lease,
(iii) the use of the Premises remains unchanged, and (iv) if Tenant is
no longer a viable and operating business entity, the assignee or
sublessee has a net worth which is consistent with the
leasing/financial requirements of Landlord taking into consideration
the size of the Premises, the rental structure, rights and privileges
granted to the Tenant pursuant to this Lease, and other concessions
granted to Tenant pursuant to the provisions of this Lease. Provided
that Tenant is a corporation, and (i) the stock of Tenant is traded on
a national exchange, the transfer of stock in Tenant shall not be
considered an assignment, sublease or transfer under the Lease, or (ii)
the stock of Tenant is not traded on a national exchange, the
collective transfer of forty nine percent (49.00%) or less of such
stock shall not be considered an assignment, sublease or transfer under
this Lease.
(b) If at any time or from time to time during the Term of
this Lease, Tenant desires to assign this Lease with respect to, or to
sublet, all or any part of the Premises, then at least thirty (30) days
prior to the date when Tenant desires the assignment or subletting to
be effective (the "TRANSFER DATE"), Tenant shall give Landlord a notice
(the "TRANSFER NOTICE") which shall set forth the name, address and
business of the proposed assignee or subtenant, information (including
financial statements and references) concerning the character of the
proposed assignee or subtenant, in the case of a proposed sublease, a
detailed description of the space proposed to be sublet, which must be
a single, self-contained unit (the "SPACE"), any rights of the proposed
assignee or subtenant to use Tenant's improvements and the like, the
Transfer Date, and the fixed rent and/or other consideration and all
other material terms and conditions of the proposed assignment or
subletting, all in such detail as Landlord may reasonably require.
(c) Landlord shall be permitted to consider any reasonable
factor in determining whether or not to withhold its consent to a
proposed assignment or sublease and Landlord shall make such
determination within thirty (30) days following Landlord's receipt of
the Transfer Notice. The failure of Landlord to deliver written notice
of such determination within such time period shall be deemed
Landlord's approval thereof. Without limiting the other instances in
which it may be reasonable for Landlord to withhold its consent to an
assignment or sublease, it shall be reasonable for Landlord to withhold
its consent if any of the following conditions are not satisfied:
(1) The proposed transferee shall have a net worth
which is consistent with the leasing/financial requirements of
Landlord taking into consideration the size of the Premises,
the rental structure, rights and privileges granted to the
Tenant pursuant to this Lease, and other concessions granted
to Tenant pursuant to the provisions of this Lease;
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(2) The proposed use by the transferee shall (i)
comply with Tenant's permitted use, (ii) be consistent with
the general character of businesses carried on by tenants of a
first-class office building, (iii) not increase the likelihood
of damage or destruction, (iv) not materially increase the
density of, occupancy of the Premises or increase the amount
of pedestrian and other traffic through the Building, (v) not
be likely to cause an increase in insurance premiums for
insurance policies applicable to the Building, (vi) not
require new tenant improvements incompatible with
then-existing Building systems and components, unless paid for
by Tenant, and (vii) unless paid by Tenant, not require
Landlord to make modifications to the Building outside of the
Premises (in order, for example, to comply with laws such as
the ADA);
(3) The proposed transferee shall not be a labor
union, foreign or domestic governmental entity or public
utility company which includes, as part of its business
operation, customer traffic to and from the Premises;
(4) If Landlord has vacant space at the Building
suitable for such proposed transferee, the proposed transferee
shall not be an existing tenant or occupant of the Building or
a person or entity with whom Landlord is then dealing, or with
whom Landlord has had any dealings within the previous six (6)
months, with respect to the leasing of space in the Building;
and
(5) Any ground lessor or mortgagee whose consent to
such transfer is required fails to consent thereto. Tenant
shall have the burden of demonstrating that each of the
foregoing conditions has been satisfied.
(d) Provided Landlord has consented to such assignment or
subletting, Tenant shall be entitled to enter into such Assignment or
Sublease with the third party identified in the Transfer Notice subject
to the following conditions:
(1) At the time of the transfer, no event of material
default under this Lease shall have occurred and be
continuing;
(2) The assignment or sublease shall be on the same
terms set forth in the Transfer Notice given to Landlord;
(3) No assignment or sublease shall be valid and no
assignee or sublessee shall take possession until an executed
counterpart of the assignment or sublease has been delivered
to Landlord;
(4) No assignee or sublessee shall have a right
further to assign or sublet without Landlord's consent thereto
in each instance, which consent in the case of a future
assignment or sublease should not be unreasonably withheld;
(5) Any assignee shall have assumed in writing the
obligations of Tenant under this Lease;
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(6) Any subtenant shall have agreed in writing to
comply with all applicable terms and conditions of this Lease
with respect to the Space;
(7) In the event Tenant sublets the entire Premises
or any part thereof, Tenant shall deliver to Landlord fifty
percent (50.00%) of any excess rent within thirty (30) days of
Tenant's receipt thereof pursuant to such subletting. As used
herein, "EXCESS RENT" shall mean any sums or economic
consideration per square foot of the Premises received by
Tenant pursuant to such subletting in excess of the amount of
the rent per square foot of the Premises payable by Tenant
under this Lease applicable to the part or parts of the
Premises so sublet; provided, however, that no excess payment
shall be payable until Tenant shall have recovered therefrom
all of the costs incurred by Tenant for brokerage commissions,
tenant improvement work approved by Landlord, reasonable
attorneys fees, and reasonable marketing fees, in conjunction
with such sublease; and
(8) In the event Tenant assigns this Lease, Tenant
shall deliver to Landlord fifty percent (50.00%) of any excess
payment within thirty (30) days of Tenant's receipt thereof
pursuant to such assignment. As used herein, "EXCESS PAYMENT"
shall mean the amount of payment received for such assignment
of this Lease (to the extent applicable only to this Lease) in
excess of the rent payable by Tenant under this Lease;
provided, however, that no excess payment shall be payable
until Tenant shall have recovered therefrom all of the costs
incurred by Tenant for brokerage commissions, tenant
improvement work approved by Landlord, reasonable attorneys
fees, and reasonable marketing fees, in conjunction with such
assignment.
(e) No subletting or assignment shall release Tenant of
Tenant's obligations under this Lease or alter the liability of Tenant
to pay the rent and to perform all other obligations to be performed by
Tenant hereunder. The acceptance of rent by Landlord from any other
person shall not be deemed to be a waiver by Landlord of any provision
hereof. Consent to one assignment or subletting shall not be deemed
consent to any subsequent assignment or subletting. In the event of
default by an assignee or subtenant of Tenant or any successor of
Tenant in the performance of any of the terms hereof, Landlord may
proceed directly against Tenant without the necessity of exhausting
remedies against such assignee, subtenant or successor. Provided that
Landlord has provided Tenant with prior written notice, Landlord may
consent to subsequent assignments of the Lease or sublettings or
amendments or modifications to the Lease with assignees of Tenant.
(f) If Tenant assigns the Lease or sublets the Premises or
requests the consent of Landlord to any assignment or subletting or if
Tenant requests the consent of Landlord for any act that Tenant
proposes to do, then Tenant shall, upon demand, pay Landlord an
administrative fee of Five Hundred and No/100ths Dollars ($500.00).
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14. HOLD HARMLESS
Subject to the provisions of Section 15 below and to the extent not
funded and paid to Landlord by any insurance maintained by Tenant,
Tenant shall indemnify, defend and hold harmless Landlord against and
from any and all claims, damages, liabilities, and expenses (including
reasonable attorneys' fees) to the extent arising from Tenant's use of
the Premises for the conduct of its business or from any activity, work
or other thing done, permitted or suffered by the Tenant in or about
the Building, and shall further indemnify, defend and hold harmless
Landlord against and from any and all claims to the extent arising from
any breach or default in the performance of any obligation on Tenant's
part to be performed under the terms of this Lease, or from any act or
negligence of the Tenant, or any officer, agent, employee, guest or
invitee of Tenant, and from all and against all reasonable cost,
attorney's fees, expenses and liabilities incurred in or about any such
claim or any action or proceeding brought thereon, and, if any case,
action or proceeding be brought against Landlord by reason of any such
claim, Tenant upon notice from Landlord shall defend the same at
Tenant's expense by counsel selected by Tenant and approved in writing
by Landlord such approval not to be unreasonably withheld or delayed.
Notwithstanding the preceding sentence, such indemnification by Tenant
and such assumption and waiver of claims shall not include damage or
injury to the extent caused by the negligence or willful misconduct of
Landlord, its agents, employees or contractors. Subject to Section 15
below and to the extent not funded and paid to Landlord by any
insurance maintained by Tenant, Landlord shall indemnify, defend and
hold harmless Tenant against and from any and all claims, damages,
liabilities, and expenses (including reasonable attorneys' fees) to the
extent arising from any breach or default in the performance of any
obligation on Landlord's part to be performed under the terms of this
Lease, or from any act or negligence of Landlord, or any officer,
agent, employee, guest or invitee of Landlord, and from and against all
reasonable costs, attorneys' fees, expenses and liabilities incurred in
or about any such claim or any action or proceeding brought thereon,
and, if any case, action or proceeding be brought against Tenant by
reason of any such claim, Landlord upon notice from Tenant, shall
defend same at Landlord's expense by counsel selected by Landlord and
approved in writing by Tenant, such approval not to be unreasonably
withheld or delayed. Notwithstanding any other provision of this Lease
to the contrary, Landlord shall not be responsible for any damages
relating to Tenant's loss of business resulting from an event requiring
indemnification pursuant to this Section.
Landlord shall not be liable to Tenant and Tenant hereby waives all
claims against Landlord or its affiliates for any injury or damage to
any person or property occurring or incurred in connection with or in
any way relating to the Premises, the Building or the Property from any
cause, excepting the gross negligence or willful misconduct of
Landlord. Without limiting the foregoing, neither Landlord nor any of
its Affiliates shall be liable for and there shall be no abatement of
rent for (i) any damage to Tenant's property stored with or entrusted
to Affiliates of Landlord, (ii) loss of or damage to any property by
theft or any other wrongful or illegal act, or (iii) any injury or
damage to persons or property resulting from fire, explosion, falling
plaster, steam, gas, electricity, water or rain which may leak from any
part of the Building or the Project or from the pipes, appliances,
appurtenances or plumbing works therein or from the roof, street or
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sub-surface or from any other place or resulting from dampness or any
other cause whatsoever or from the acts or omissions of other tenants,
occupants or other visitors to the Building or the Project or from any
other cause whatsoever, or (iv) any diminution or shutting off of
light, air or view by any structure which may be erected on lands
adjacent to the Building, whether within or outside of the Property.
Tenant agrees that in no case shall Landlord ever be responsible or
liable on any theory for any injury to Tenant's business, loss of
profits, loss of income or any other form of consequential and/or
punitive damage. Tenant shall give prompt notice to Landlord in the
event of (a) the occurrence of a fire or accident in the Premises or in
the Building, or (b) the discovery of any defect therein or in the
fixtures or equipment thereof. Notwithstanding any other provision of
this Lease to the contrary, Tenant waives any claims based on damage or
injury resulting from Landlord's failure to police or provide security
for the Property.
15. SUBROGATION
Landlord and Tenant hereby mutually waive their respective rights of
recovery against each other for any loss or damage that is or would be
insured by fire, extended coverage and other property insurance
policies existing for the benefits of the respective parties or
required to be obtained by the releasing party pursuant to the
provisions of the Lease. Each party shall obtain any special
endorsements, if required by their insurer to evidence compliance with
the aforementioned waiver.
16. LIABILITY INSURANCE
(a) All insurance required to be carried by Tenant hereunder
shall be issued by responsible insurance companies which are rated by
Best Insurance Reports as A:VII or better and acceptable to Landlord
and Landlord's lender and licensed or authorized to do business in the
State of Colorado. Each policy shall name Landlord, and at Landlord's
request any mortgagee of Landlord, as an additional insured, as their
respective interests may appear. Each policy shall contain (i) a
separation of insureds condition, (ii) a provision that such policy and
the coverage evidenced thereby shall be primary and non-contributing
with respect to any policies carried by Landlord and that any coverage
carried by Landlord shall be excess insurance for Landlord's interest
only, and (iii) a waiver by the insurer of any right of subrogation
against Landlord, its agents, employees and representatives, which
arises or might arise by reason of any payment under such policy or by
reason of any act or omission of Landlord, its agents, employees or
representatives. A copy of each paid up policy (authenticated by the
insurer) or certificate of the insurer evidencing the existence and
amount of each insurance policy required hereunder shall be delivered
to Landlord before the date Tenant is given possession of the Premises,
and thereafter, within thirty (30) days after any demand by Landlord
therefor, Landlord may, at any time and from time to time, inspect
and/or copy any insurance policies required to be maintained by Tenant
hereunder. No such policy shall be cancelable, materially changed or
reduced in coverage except after thirty (30) days' written notice to
Landlord and Landlord's lender. Tenant shall furnish Landlord with
renewals or "binders" of any such policy at least ten (10) days prior
to the expiration thereof. Tenant agrees that if Tenant does not take
out and maintain such insurance, Landlord may (but shall not be
required to) procure said insurance on Tenant's behalf and
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charge the Tenant the premiums, which shall be payable upon demand.
Tenant shall have the right to provide such insurance coverage pursuant
to blanket policies obtained by the Tenant, provided such blanket
policies expressly afford coverage to the Premises, Landlord,
Landlord's mortgagee and Tenant as required by this Lease.
(b) Beginning on the date Tenant is given access to the
Premises for any purpose and continuing until expiration of the term of
the Lease, Tenant shall procure, pay for and maintain in effect
policies of property insurance covering trade fixtures, merchandise and
other personal property from time to time, in, on or about the
Premises. The proceeds of such insurance shall be used for the repair
or replacement of the property so insured. Upon termination of this
Lease following a casualty as set forth herein, the proceeds under (i)
shall be paid to Landlord, and the proceeds under (ii) above shall be
paid to Tenant.
(c) Beginning on the date Tenant is given access to the
Premises for any purpose and continuing until expiration of the Term of
the Lease, Tenant shall procure, pay for and maintain in effect
workers' compensation and employer's liability insurance and commercial
general liability insurance which includes coverage for personal
injury, contractual liability and Tenant's independent contractors. The
commercial general liability should be procured and maintained with not
less than Two Million and No/100ths Dollars ($2,000,000.00) per
occurrence combined single limit, and a Five Million and No/100ths
Dollars ($5,000,000.00) aggregate limit, for bodily injury, personal
injury or property damage liability. If such insurance covers more than
one location, and general aggregate limit shall apply on a per location
basis.
(d) Whenever, in Landlord's reasonable judgment, but not more
than twice during the Term, good business practice or change in
conditions indicate a need for additional or different types of
insurance, Tenant shall upon request of Landlord obtain such insurance
at its own expense.
(e) Landlord shall obtain and keep in force during the term of
this Lease, (i) a policy of commercial general liability insurance in
amounts not less than required by Tenant in Section 16(c) above, and
(ii) fire, extended coverage and other property insurance policies of
the type typically maintained by property owners of Class A office
buildings located in the vicinity of the Building in Boulder County,
insuring the Building and related improvements constituting common
areas for the Building at full replacement cost. The premiums for such
insurance shall constitute Direct Expenses chargeable to tenants of the
Building in accordance with Section 7 above.
17. SERVICES AND UTILITIES
(a) Tenant shall be solely responsible for obtaining service
and thereafter paying the cost of all electrical service required for
Tenant's use of the Premises, which includes, but is not limited to,
electrical services required for the heating and air conditioning
system ("HVAC") for the Premises, and the use of the Premises by
Tenant. In this regard, the Premises shall be separately metered for
electrical consumption and Tenant shall pay all such amounts due prior
to delinquency. As provided in the Work
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Letter Agreement (which includes the agreed upon electrical
specifications for the Premises), Landlord shall cause all electrical
distribution to be installed within the Premises. The failure of
such electrical service to be provided to the Premises, or any
cessation thereof, shall not render Landlord liable in any respect
for damages to either person or property, nor be construed an eviction
of Tenant, nor cause an abatement of rent, or relieve Tenant from the
fulfillment of any covenant or agreement thereof. Whenever heat
generating machines or equipment are used in the Premises or Tenant's
use of the Premises beyond customary business hours (7:00 a.m. to 7:00
p.m., Monday through Friday, and 7:00 a.m. to 12:00 p.m. on Saturdays
(federal and state holidays excepted) ("BUSINESS HOURS")) adversely
affect the temperature otherwise maintained by the air conditioning
system, Landlord reserves the right to install supplementary air
conditioning units for the Premises and the cost thereof, including the
cost of installation, and the cost of operation and maintenance
thereof, shall be paid by Tenant to Landlord upon demand by Landlord.
Tenant shall be entitled to access to the Premises twenty-four (24)
hours a day, seven (7) days a week. Landlord shall maintain and keep
lighted the common stairs, common entries and toilet rooms in the
Building. Subject to Tenant's obligation to pay for the required
electricity, Landlord shall cause the HVAC to maintain the Premises at
an approximate range of between 72 degrees and 74 degrees Fahrenheit
(plus or minus 2 degrees Fahrenheit) during the Business Hours, which
service shall be provided to the Premises by HVAC system described in
the Work Letter Agreement. As set forth in the Work Letter Agreement,
the Premises shall comply with the requirements of ASHRAE Standard
62-1989 (20 CFM per occupant for office type occupancy or as otherwise
required by applicable law). Landlord shall not be liable for, and
Tenant shall not be entitled to, any reduction of rental by reason of
Landlord's failure to furnish any of the foregoing when such failure is
caused by accident, breakage, repairs, strikes, lockouts or other labor
disturbances or labor disputes of any character, or by any other cause
similar or dissimilar, beyond the reasonable control of Landlord.
Landlord shall not be liable under any circumstances for a loss of or
injury to property; person or Tenant's business occurring through or in
connection with or incidental to failure to furnish such utilities.
(b) If Tenant shall require water in excess of that usually
furnished or supplied for the use of the Premises as general office
space, Tenant shall pay Landlord for such excessive use (in excess of
water consumption provided for general office use for tenants in the
vicinity of the Building) upon written demand by Landlord. If Tenant's
utility requirements are excessive, Landlord may cause a water meter to
be installed in the Premises so as to measure the amount of water
consumed for any such use. The cost of any such meters and of
installations, maintenance and repair thereof shall be paid for by the
Tenant and Tenant agrees to pay to Landlord promptly upon demand
therefore by Landlord for all such water currently consumed as shown by
said meters, at the rates charged for such services by the local
utility furnishing the same, plus any additional expense incurred in
keeping account of the water will be established by an estimate made by
a utility company, in which case such expense shall not be included
within Direct Expenses.
(c) Tenant acknowledges that the use of the HVAC system during
non-Business Hours shall result in excessive wear and tear on such
system, accordingly, if
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Tenant intends to utilize non-Business Hours HVAC service on a regular
reoccurring basis (more than two (2) hours a day, for in excess of an
average of seven (7) days a calendar month, for three (3) consecutive
calendar months), Landlord shall have the right to obtain a service
agreement for such system, which provides for maintenance, repair and
replacement, the cost of which shall be paid directly by Tenant (such
costs shall not be within the definition of Direct Expenses).
18. PROPERTY TAXES
Tenant shall pay all taxes and assessments against any personal
property, trade fixtures, or other improvements on the Premises
belonging to Tenant. Tenant shall also pay any sales, use or rental tax
related to Tenant's property or business which may be assessed by any
governmental body during the term of this Lease. Tenant shall pay such
taxes and assessments billed separately to Tenant prior to delinquency.
Tenant shall have the right to contest any tax or assessment levied as
described in this Section; provided that Tenant posts the requisite
bonds, which are upon terms and conditions reasonably acceptable to
Landlord, to remove and/or avoid any form of lien as an encumbrance
against the Building. Tenant shall provide Landlord with prior written
notice of any such intention to contest. In the event such taxes and
assessments are billed to Landlord, Tenant shall pay to Landlord its
share of same within thirty (30) days after delivery to Tenant by
Landlord of a statement in writing, setting forth the amount of such
taxes or assessments applicable to Tenant's property. Tenant shall have
the right to dispute such taxes with the taxing authorities provided
that adequate assurances, as reasonably determined by Landlord, to pay
such amount are made by Tenant. Amounts payable by Tenant pursuant to
this Section 18 shall not be included within Direct Expenses and, in no
event, shall any amount payable hereunder be included within the
definition of Real Estate Taxes.
19. RULES AND REGULATIONS
Tenant shall faithfully observe and comply with the rules and
regulations that Landlord shall from time to time promulgate. Landlord
reserves the right from time to time to make all reasonable
modifications to said rules, which are normal and customary in the
market and nondiscriminatory. The additions and modifications to those
rules shall be binding upon Tenant upon delivery of a copy of them to
Tenant; provided that no such modification shall increase expenses
otherwise payable by Tenant, or increase duties or obligations owing by
Tenant pursuant to this Lease. Landlord shall not be responsible to
Tenant for the nonperformance of any said rules by any other tenants or
occupants.
20. HOLDING OVER
If Tenant remains in possession of the Premises or any part thereof
after expiration of the term hereof, without the expressed written
consent of Landlord, such occupancy shall be a tenancy from
month-to-month at a rental in the amount of one hundred fifty percent
(150%) multiplied by the last monthly rental, plus all other charges
payable hereunder, and upon all the terms hereof applicable to a
month-to-month tenancy. If either party desires to terminate such
month-to-month tenancy, it shall give the other party not less than
thirty (30) days advance written notice of the date of such
termination.
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21. ENTRY BY LANDLORD
Subject to Tenant's security procedures ("TENANT SECURITY PROCEDURES"),
a written summary of which Tenant shall provide to Landlord within
sixty (60) days following the Commencement Date, Landlord reserves and
shall at any and all reasonable times have the right to enter the
Premises, inspect the same, supply janitorial service and any other
service to be provided by Landlord to Tenant hereunder, to submit said
Premises to prospective purchasers or tenants, to post notices of
non-responsibility, and to improve or repair the Premises and any
portion of the Building of which the Premises are a part that Landlord
may deem necessary or desirable, without abatement of rent and may for
that purpose erect scaffolding and other necessary structures where
reasonably required by the character of the work to be performed,
always providing that the entrance to the Premises shall not be blocked
thereby, and further providing that the business of the Tenant shall
not be interfered with unreasonably. Tenant hereby waives any claim for
damages or for any injury or inconvenience to or interference with
Tenant's business, any loss of occupancy or quiet enjoyment of the
Premises, and any other loss occasioned thereby, provided that
Landlord's activities have been reasonable. Any such entrance shall be
done in a manner that minimizes interference with Tenant's business
operations at the Premises. For each of the aforesaid purposes, subject
to Tenant Security Procedures, Landlord shall at all times have and
retain a key with which to unlock all of the doors in, upon and about
the Premises, excluding Tenant's vaults, safes and files, and Landlord
shall have the right to use any and all means which Landlord may deem
proper to open said doors in an emergency, in order to obtain entry to
the Premises without liability to Tenant, except for any failure to
exercise due care for Tenant's property. Any entry to the Premises
obtained by Landlord by any of said means, or otherwise shall not under
any circumstances be construed or deemed to be a forcible or unlawful
entry into, or a detainer of the premises, or an eviction of Tenant
from the Premises or any portion thereof.
22. RECONSTRUCTION
(a) In the event the Premises or the Building of which the
Premises are a part are damaged by fire or other perils covered by
extended coverage insurance carried by Landlord, Landlord agrees to
forthwith repair the same; and this Lease shall remain in full force
and effect, except that Tenant shall be entitled to a proportionate
reduction of the rent, which shall be negotiated in good faith, while
such repairs are being made, such proportionate reduction to be based
upon the extent to which the making of such repairs shall materially
interfere with the business carried on by the Tenant in the Premises
which is not mitigated by any business interruption insurance carried
by Tenant. If the damage is due to the fault or neglect of Tenant or
its employees, there shall be no abatement of rent.
(b) In the event the Premises or the Building or a part are
damaged by fire or other perils not covered by extended coverage
insurance, then Landlord shall forthwith repair the same, provided the
extent of the destruction be less than twenty percent (20%) of the then
full replacement cost of the Premises or the Building of which the
Premises are a part. In the event the destruction of the Premises or
the Building is to an extent
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greater than twenty percent (20%) of the full replacement cost, the
Landlord shall have the option: (1) to repair or restore such damage,
this Lease continuing in full force and effect, but the rent to be
proportionately reduced as hereinabove in this Article provided; or (2)
give notice to Tenant at any time within ninety (90) days after such
damage terminating this Lease as of the date specified in such notice,
which date shall be no less than sixty (60) days and no more than
ninety (90) days after the giving of such notice. In the event of
giving such notice, this Lease shall expire and all interest of the
Tenant in the Premises shall terminate on the date so specified in such
notice and the rent, reduced by a proportionate amount based upon the
extent, if any, to which such damage materially interfered with the
business carried on by the Tenant in the Premises, shall be paid up to
date of said such termination.
(c) Notwithstanding anything to the contrary contained in this
Article, Landlord shall not have any obligation whatsoever to repair,
reconstruct or restore the Premises when the damage, in excess of
fifteen percent (15%) of the replacement cost of the Building,
resulting from any casualty covered under this Article occurs during
the last twelve (12) months of the term of this Lease or any extension
thereof. If Landlord elects not to repair, reconstruct or restore the
Premises during such twelve (12) month period, this Lease shall be
deemed terminated on the date of such damage.
(d) Landlord shall not be required to repair any damage caused
by fire or other cause, or to make any repairs or replacements of any
panels, decoration, office fixtures, railings, floor covering,
partitions, or any other property installed in the Premises by Tenant.
(e) The Tenant shall not be entitled to any compensation or
damages from Landlord for loss of the use of the whole or any part of
the Premises, Tenant's personal property or any inconvenience or
annoyance occasioned by such damage, repair, reconstruction or
restoration.
(f) Tenant may elect to terminate this Lease at any time
during the term hereof, if the Premises are destroyed or rendered
untenantable to an extent that they cannot be repaired within two
hundred twenty-five (225) days following the casualty, as reasonably
determined by Landlord in writing delivered to Tenant within forty-five
(45) days following the date of such damage, by delivery of written
notice of such election within fifteen (15) days following Tenant's
receipt of such notice. Thereafter, in the event that such repairs are
not substantially complete within such two hundred twenty-five (225)
day period, as may be extended by delays caused by Tenant for a period
of fifteen (15) days thereafter, Tenant shall have the right to
terminate this Lease by delivery of written notice of such election.
The termination of this Lease pursuant to this Section 22(f) shall be
effective upon Landlord's receipt of such notice.
23. DEFAULT
The occurrence of any one or more of the following events shall
constitute a default and breach of this Lease by Tenant:
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(a) The abandonment, without payment or rent, or vacating of
the Premises by Tenant (must be in excess of ten (10) business days).
(b) The failure by Tenant to make any payment of rent or any
other payment required to be made by Tenant hereunder within ten (10)
days following Tenant's receipt of written notice from Landlord that
such amount is due.
(c) The failure by Tenant to observe or perform any of the
covenants, conditions or provisions of this Lease to be observed or
performed by the Tenant, other than described in Article 23(a) above,
where such failure shall continue for a period of thirty (30) days
after written notice thereof by Landlord to Tenant; provided, however,
that if the nature of Tenant's default is such that more than thirty
(30) days are reasonably required for its cure, then Tenant shall not
be deemed to be in default if Tenant commences such cure within said
thirty (30)-day period and thereafter diligently prosecutes such cure
to completion.
(d) The making by Tenant of any general assignment or general
arrangement for the benefit of creditors; or the filing by or against
Tenant of a petition to have Tenant adjudged bankrupt, or a petition or
reorganization or arrangement under any law relating to bankruptcy
(unless, in the case of a petition filed against Tenant, the same is
dismissed within sixty (60) days); or the appointment of a trustee or a
receiver to take possession of substantially all of Tenant's assets
located at the Premises or of Tenant's interest in this Lease, where
possession is not restored to Tenant within thirty (30) days; or the
attachment, execution or other judicial seizure of substantially all of
Tenant's assets located at the Premises or of Tenant's interest in this
Lease where such seizure is not discharged in thirty (30) days.
24. REMEDIES IN DEFAULT
In the event of Tenant's default, Landlord may:
(a) Terminate Tenant's right to possession of the Premises by
any lawful means, in which case this Lease shall terminate and Tenant
shall immediately surrender possession of the Premises to Landlord. In
such event, Landlord shall be entitled to recover from Tenant:
(1) the worth at the time of the award of any unpaid
rent which had been earned at the time of such termination;
plus
(2) the worth at the time of the award of the amount
by which the unpaid rent which would have been earned after
termination until the time of award exceeds the amount of such
rental loss which Tenant proves could have been reasonably
avoided; plus
(3) the worth at the time of the award of the amount
by which the unpaid rent for the balance of the term after the
time of award exceeds the amount of such rental loss which
Tenant proves could be reasonably avoided; plus
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(4) any other amount necessary to compensate Landlord
for all the detriment proximately caused by Tenant's failure
to perform its obligations under this Lease or which in the
ordinary course of things would be likely to result therefrom
(including, without limitation, the cost of recovering
possession of the Premises, reasonable and necessary expenses
of reletting including necessary renovation and alteration of
the Premises to make the Premises and/or portions thereof
tenantable for general office purposes consistent with the
finish of the Premises as improved pursuant to the Work Letter
Agreement, reasonable attorneys' fees, and real estate
commissions actually paid and that portion of the leasing
commission paid by Landlord and applicable to the unexpired
portion of this Lease); plus
(5) such other amounts in addition to or in lieu of
the foregoing as may be permitted from time to time by
applicable Colorado law.
As used in Subsections (1) and (2) above, the "WORTH
AT THE TIME OF THE AWARD" shall be computed by allowing
interest at the lesser of ten percent (10%) per annum, or the
maximum rate permitted by law per annum. As used in Subsection
(3) above, the "WORTH AT THE TIME OF AWARD" shall be computed
by discounting such amount at the discount rate of the Federal
Reserve Bank of San Francisco at the time of award plus one
percent (1%).
(b) Continue this Lease in full force and effect, and the
Lease will continue in effect, as long as Landlord does not terminate
Tenant's right to possession, and Landlord shall have the right to
collect rent when due. During the period Tenant is in default, Landlord
may enter the Premises and relet them, or any part of them, to third
parties for Tenant's account. Tenant shall be liable immediately to
Landlord for all costs Landlord reasonably incurs in reletting the
Premises, including, without limitation, brokers' commissions, expenses
of remodeling the Premises required by the reletting, and like costs.
Reletting can be for a period shorter or longer than the remaining term
of this Lease (provided, however, in no event shall Tenant be
responsible for any cost relating to such reletting after the
expiration of the term of this Lease). Tenant shall pay to landlord the
rent due under this Lease on the dates the rent is due, less the rent
Landlord receives from any reletting. In no event shall Tenant be
entitled to any excess rent received by Landlord. No act by Landlord
allowed by this paragraph shall terminate this Lease unless Landlord
notifies Tenant in writing that Landlord elects to terminate this
Lease. After Tenant's default and for as long as Landlord does not
terminate Tenant's right to possession of the Premises, if Tenant
obtains Landlord's consent, Tenant shall have the right to assign or
sublet its interest in this Lease, but Tenant shall not be released
from liability.
(c) Cause a receiver to be appointed to collect rent. Neither
the filing of a petition for the appointment of a receiver nor the
appointment itself shall constitute an election by Landlord to
terminate the Lease.
(d) Cure the default at Tenant's cost. If Landlord at any
time, by reason of Tenant's default, reasonably pays any sum or does
any act that requires the payment of
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any sum, the sum paid by Landlord shall be due immediately from Tenant
to Landlord at the time the sum is paid, and if paid at a later date
shall bear interest at the lesser of ten percent (10%) per annum, or
the maximum rate permitted by law. The sum, together with interest on
it, shall be additional rent.
(e) The foregoing remedies are not exclusive; they are
cumulative, in addition to any remedies now or later allowed by law, to
any equitable remedies Landlord may have, and to any remedies Landlord
may have under bankruptcy laws or laws affecting creditors' rights
generally. The waiver by Landlord of any breach of any term, covenant
or condition of this Lease shall not be deemed a waiver of such term,
covenant or condition or of any subsequent breach of the same or any
other term, covenant or condition. Acceptance of rent by Landlord
subsequent to any breach hereof shall not be deemed a waiver of any
proceeding breach other than a failure to pay the particular rent so
accepted, regardless of Landlord's knowledge of any breach at the time
of such acceptance of rent. Landlord shall not be deemed to have waived
any term, covenant or condition unless Landlord gives Tenant written
notice of such waiver.
(f) Notwithstanding anything to the contrary contained
elsewhere in this Lease, Landlord shall use reasonable efforts to relet
the Premises to mitigate its damages under this Section 24; provided,
however, that so long as Landlord uses such reasonable efforts,
Landlord shall in no way be responsible or liable for any failure to
relet the Premises, or any part thereof, or any failure to collect any
rent due upon such reletting; and Landlord shall not be required to
spend its own funds, to give the Premises priority over or equal
priority with any other facilities owned by Landlord or its affiliates
or other space available for rent in the Building or to compromise in
any way the terms, uses or creditworthiness of a Tenant upon or to
which it would customarily lease space such as the Premises; and
Landlord shall be entitled, in its sole discretion, to seek a single
tenant for the entire Premises, even though it may take a substantially
longer period to obtain such a tenant and its efforts may be
unsuccessful; and this requirement shall not affect in any way Tenant's
obligations to obtain Landlord's consent to a sublease or assignment.
25. EMINENT DOMAIN
If more than twenty-five percent (25%) of the Premises shall be taken
or appropriated by any public or quasi-public authority under the power
of eminent domain, either party hereto shall have the right, at its
option to terminate this Lease, and Landlord shall be entitled to any
and all income, rent award, or any interest therein whatsoever which
may be paid or made in connection with such public or quasi-public use
or purpose, and Tenant shall have no claim against Landlord for the
value of any unexpired term of this Lease. If either less than or more
than twenty-five percent (25%) of the Premises is taken, and neither
party elects to terminate as herein provided, the rental thereafter to
be paid shall be equitably reduced. If twenty-five percent (25%) or
more of the Building other than the Premises may be so taken or
appropriated, Landlord shall have the right at its option to terminate
this Lease and shall be entitled to the entire award as above provided.
Notwithstanding the foregoing, subject to applicable law, Tenant may
seek payment from the condemning authority for reimbursement for
unamortized tenant improvements installed by Tenant, at its cost,
goodwill, and relocation expenses, provided such recovery
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does not adversely affect Landlord's ability to recover amounts from
such condemning authority. In the event that, Tenant is not permitted
to seek such award separately pursuant to applicable law, Tenant shall
be permitted to jointly pursue such award with Landlord, provided such
recovery does not adversely affect Landlord's ability to recover
amounts from such condemning authority.
26. ESTOPPEL CERTIFICATE
Within ten (10) days following any written request which Landlord may
make from time to time, Tenant shall execute and deliver to Landlord a
statement certifying: (i) the date of commencement of this Lease; (ii)
the fact that this Lease is unmodified and in full force and effect (or
if there have been modifications hereto, that this Lease is in full
force and effect, as modified, and stating the date and nature of such
modifications); (iii) the date to which the rental and other sums
payable under this Lease have been paid; (iv) the fact that there are
no current defaults under this Lease by either Landlord or Tenant,
except as specified in Tenant's statement; and (v) such other matters
requested by Landlord. Landlord and Tenant intend that any statement
delivered pursuant to this paragraph 26 may be relied upon by any
mortgagee, beneficiary, purchaser or prospective purchaser of the
Building or any interest therein. Tenant shall also have the right to
request an estoppel certificate from Landlord pursuant to the
provisions of this Section 26.
27. PARKING
Tenant shall have the right to park in the Building's parking
facilities in common with other tenants of the Building upon terms and
conditions as may from time to time be established by Landlord. Such
parking right shall be upon a ratio of four and 50/100ths (4.50) spaces
for each one thousand (1,000) rentable square feet within the Premises.
Tenant agrees not to overburden the parking facilities and agrees to
cooperate with Landlord and other Tenants in the use of the parking
facilities. Landlord reserves the right in its reasonable discretion to
determine whether the parking facilities are becoming crowded and to
allocate and assign parking spaces among Tenant and the other tenants,
and to alter, relocate, or otherwise change the parking facilities and
to take measures with respect to the parking area from time to time in
order to comply with the policies of any transportation management
association or any governmental ordinance, law or regulation, subject
to maintaining the above-specified parking ratio. Landlord shall have
the right, in addition to pursuing any other legal remedy available, to
tow any vehicle belonging to Tenant or Tenant's employees which is not
in compliance with the regulations for the parking facility then in
effect if a violation continues after the first notice of such
violation, at the expense of the towed party; nothing in this Lease,
however, shall require Landlord to tow parked cars or take other
actions to free occupied spaces for Tenant's use. Landlord shall not be
liable for any claims, losses, damages, expenses or demands with
respect to injury or damage to the vehicles of Tenant or Tenant's
customers or employees that park in the parking areas of the Project,
except for such loss or damage as may be caused by Landlord's gross
negligence or willful misconduct.
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28. AUTHORITY OF PARTIES
If a party to this Lease is a corporation or partnership, each
individual executing this Lease on behalf of said corporation or
partnership represents and warrants that he is duly authorized to
execute and deliver this Lease on behalf of said corporation or
partnership, in accordance with a duly adopted resolution or other
document, and that this Lease is binding upon said corporation or
partnership, as appropriate in accordance with its terms. The
individuals signing on behalf of a corporate entity are executing this
Lease in their respective corporate capacities and there shall be no
individual liability imposed upon such signatories in such case.
29. DEFAULT BY LANDLORD
(a) Landlord shall not be deemed to be in default in the
performance of any obligation required to be performed by it hereunder
unless and until it has failed to perform such obligations within
twenty (20) days after written notice by Tenant to Landlord specifying
wherein Landlord has failed to perform such obligation; provided,
however, that if the nature of Landlord's obligation is such that more
than twenty (20) days are required for its performance, then Landlord
shall not be deemed to be in default if it shall commence such
performance within such twenty (20)-day period and thereafter
diligently prosecute the same to completion. In no event shall Landlord
be liable to Tenant for loss of profits, business interruption, or
consequential damages if Landlord performs its obligations within the
time periods specified in this paragraph.
(b) Tenant agrees to give any mortgagee and/or trust deed
holders, by registered mail, a copy of any Notice of Default served
upon the Landlord, provided that prior to such notice Tenant has been
notified in writing of the address of such mortgagee and/or trust deed
holder. Tenant further agrees that if Landlord shall have failed to
cure such default within the time provided for in this Lease, then the
mortgagees and/or trust deed holders shall have an additional thirty
(30) days within which to cure such default, or if such default cannot
be cured within that time, then such additional time as may be
necessary if within thirty (30) days mortgagee and/or trust deed holder
has commenced and is diligently pursuing the remedies necessary to cure
such default (including, but not limited to, commencement of
foreclosure proceedings, if necessary to effect such cure), in which
event this Lease shall not be terminated while remedies are being so
diligently pursued.
(c) Notwithstanding any other provisions of this Lease to the
contrary, but subject to the provisions of Section 29(a) and 29(b)
above, upon receipt of written notice (the "FIRST DEFAULT NOTICE") from
Tenant that Landlord has failed to perform any of its obligations as
expressly set forth in this Lease (collectively, "LANDLORD
OBLIGATIONS"), Landlord shall perform such obligation within a
reasonable period of time given the circumstances but in no event later
than thirty (30) days after it receives the First Default Notice;
provided, however, that if the completion of such obligation is of such
a nature that it cannot be completed within thirty (30) days, then such
longer time as reasonably necessary. If Landlord fails to complete such
obligation within the said time period, Tenant may give an additional
notice (the "SECOND DEFAULT NOTICE")
29
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to Landlord. If Landlord fails to commence to complete such obligation
within five (5) days after receipt of the Second Default Notice and
thereafter diligently pursues the completion of such obligation, Tenant
may complete such obligation. All obligations of Landlord performed by
Tenant pursuant to this Section shall be made by a qualified licensed
contractor(s) and/or qualified persons with sufficient expertise in
such matters and in accordance with all applicable laws, statutes and
ordinances. Landlord shall reimburse Tenant for Tenant's actual costs
incurred within ten (10) days after Landlord's receipt of a written
demand from Tenant, which demand shall include supporting invoices. If
Landlord disputes the need for the completion of such obligation,
Landlord shall deliver written notice of such disagreement to Tenant
within ten (10) days after its receipt of the First Default Notice. The
dispute shall be resolved by a mutually acceptable third party, which
determination shall be binding upon Landlord and Tenant; provided,
however, that if the parties cannot agree on such third party, then the
dispute shall be resolved by arbitration pursuant to the commercial
arbitration rules then in effect for the American Arbitration
Association ("ARBITRATION"). The losing party shall pay the costs of
the third party or arbitrator, whichever is applicable. If Landlord is
obligated to reimburse Tenant for the actual cost and fails to do so as
provided in this subsection, such amount shall accrue interest at the
rate of fifteen percent (15.00%) per annum until paid in full. If such
amounts owing from Landlord to Tenant are not paid within thirty (30)
days following the due date of such payment, Tenant shall have
abatement rights as set forth in Section 29(f) of this Lease.
(d) Landlord acknowledges that certain of the |
