LEASE AGREEMENT
LANDLORD: XXXXX XXXXXX VALLEY 1 L.C., BY
ITS MANAGING PARTNER, THE
XXXXX COMPANY, L.C.
TENANT: TENFOLD CORPORATION
LEASE AGREEMENT
TENFOLD OFFICE BUILDINGS PHASE I
THIS LEASE AGREEMENT (the "Lease") is made and entered into as of this 28th
day of April, 2000, by and between XXXXX XXXXXX VALLEY 1, L.C. by its managing
partner, THE XXXXX COMPANY, L.C., a Utah Limited Liability Company, (the
"Landlord"), and TENFOLD CORPORATION, a Delaware Corporation, (the "Tenant"),
(collectively the "Parties").
For and in consideration of the rental to be paid by Tenant and of the
covenants and agreements herein set forth to be kept and performed by Tenant,
Landlord hereby leases to Tenant and Tenant hereby leases from Landlord, the
Leased Premises (as hereafter defined) and certain other areas, rights and
privileges for the term, at the rental and subject to and upon all of the terms,
covenants and agreements hereinafter set forth.
It is the intent of the Parties that this Lease be construed and
interpreted as an "operating lease" under the guidelines established by EITF 97-
10 and other Generally Accepted Accounting Principles.
I. PREMISES
1.1 Description of Premises. Landlord does hereby demise, lease and
let unto Tenant, and Tenant does hereby take and receive from Landlord the
following:
(a) That certain floor area containing approximately 168,600 rentable
square feet (the "Leased Premises") in Office Buildings One and Two2 (the
"Buildings") located at approximately 00000 Xxxxx 000 Xxxx xx Xxxxx Xxxxxx, Xxxx
containing approximately 200,000 rentable square feet (the "Building Area"), on
the real property (the "Property") described on Exhibit "A" attached hereto and
by this reference incorporated herein. The space occupied by Tenant consists of
that certain area crosshatched on Exhibit "B" which is attached hereto and by
this reference incorporated herein.
(i) The Leased Premises and the Building Area shall be measured
by the Base Building architect in accordance with the American National
Standard Z65.1-1996 published by the Building Owners and Managers
Association.
(ii) "Tenant's Proportionate Share" shall mean the percentage
derived from the fraction, the numerator of which is the gross rentable
square footage of the Leased Premises (168,600), the denominator of which
is the gross rentable square footage of the Buildings (200,000). In this
Lease, Tenant's pro-rata share initially is 84.30%, subject to increase or
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decrease due to increases or decreases in the gross rentable square footage
of the Leased Premises and/or the Buildings.
(b) The non-exclusive right to Tenant's use of the Common Areas (as
defined in Section 20.1 below).
(c) Such non-exclusive rights-of-way, easements and similar rights with
respect to the Building and Property as may be reasonably necessary for access
to and egress from, the Leased Premises.
(d) The non-exclusive right to use those areas designated and suitable for
vehicular parking, including the non-exclusive right to the use of six hundred
seventy four (674) parking stalls, based on the ratio of four (4) parking spaces
per 1,000 rentable square feet.
(e) The non-exclusive right to use of the roof for installation of
Tenant's equipment including satellite equipment. Landlord shall have the right
to review and reasonably approve the location of Tenant's equipment.
1.2 Construction of Tenant Improvements. The obligation of Landlord to
perform the work and supply the necessary materials and labor to prepare the
Leased Premises for occupancy ("Tenant Improvements") are described in detail on
Exhibit "C". Landlord and Tenant shall do all acts required of them as described
on Exhibit "C", expend all funds as described on Exhibit "E" and shall perform
or have the work performed promptly and diligently in a first class and
workmanlike manner.
1.3 Construction of Building. If the Leased Premises and the Building in
which the Leased Premises are located are not currently in existence, Landlord
shall, at its own cost and expense, construct and complete such Building and
cause all of the construction which is to be performed by it in completing the
Building and performing its work as set forth on Exhibit "C", to be
substantially completed, and the Leased Premises ready for Tenant to install its
fixtures and equipment and to perform its other work as described on Exhibit "C"
as soon as reasonably possible, but in no event later than eighteen (18) months
after the date of this Lease. In the event that Landlord's obligation of
construction has not been fulfilled upon the expiration of said eighteen (18)
month period, Tenant shall have the right to exercise any right or remedy
available to it under this Lease, including the right to terminate this Lease.
Landlord shall be obligated to pay for any increase in the actual cost of
construction over and above the construction costs as specified in Exhibit "G-
1", unless such increase shall be the result of a requested change or upgrade of
the floor plan (Exhibit "B"), initiated by the Tenant, its agents or assigns.
Any change in the Buildings requested by Tenant, its agents or assigns that
results in an increase in the cost or time to complete the Buildings shall not
be performed unless Tenant executes an amendment to this Lease and Exhibit "G-
1" which will modify the Project Budget and the Tenant's lease rate.
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1.4 Changes to Building. Landlord hereby reserves the right at any
time and from time to time to make minor changes, alterations or additions
to the Building or to the Property, provided Landlord gives Tenant
reasonable prior written notice of intent to do so, and the proposed
changes or alterations will have no material impact on the Tenant's ability
to conduct its business in the Leased Premises or, except as required by
applicable law or good engineering practices, the agreed upon design.
1.5 Economic Incentives. Landlord and Tenant shall share equally any
economic benefits or tax rebates received from a Redevelopment Area or
similar incentive program granted to the Landlord exclusively for the
building by the City of South Jordan or Salt Lake County. This agreement to
share economic incentives expires when the Redevelopment Area or similar
program expires.
II. TERM
2.1 Length of Term. The term of this Lease shall be for a period of
Ten (10) years plus the partial calendar month, if any, occurring after the
Commencement Date (as hereinafter defined) if the Commencement Date occurs
other than on the first day of a calendar month.
2.2 Commencement Date; Obligation to Pay. The term of this Lease and
Tenant's obligation to pay rent hereunder shall commence on the first to
occur of the following dates ("Commencement Date"):
(a) The date Tenant occupies the Leased Premises and conducts
business.
(b) The Monday that is a minimum of Fourteen (14) calendar days after
the Landlord, notified Tenant in writing that Landlord's construction
obligations respecting the Leased Premises have been fulfilled and that the
Leased Premises are ready for occupancy.
The Commencement Date of the Lease shall not occur until each of
the following have occurred; (i) the Buildings, with the exception of minor
punch list items, are Substantially Completed as defined in AIA Document
A201-1997 in accordance with Building Plans; (ii) the Tenant Improvements,
with the exception of minor punch list items, are substantially completed
in accordance with Tenant's Plans; (iii) Landlord has obtained approval
from South Jordan City for occupancy for the Building and the Leased
Premises; (iv) the Building Systems, utilities and life safety systems
serving the Leased Premises are fully operational; (v) Tenant has access to
its allotment of parking spaces; and (vi) Landlord has tendered possession
of the Leased Premises to Tenant. Exhibit "D" acknowledges the Commencement
Date of the Lease.
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2.3 Construction of Leased Premises. Landlord shall construct or
cause to be constructed the improvements to the Leased Premises (see
Exhibit "C -Work Letter"). Landlord shall itemize each part of the
construction and its associated cost. Landlord shall pay for $843,000
($5.00 per rentable square foot) of the cost listed (the "Tenant
Allowance") and subject to the provisions of Exhibit "C" including
specifically but without limitation Paragraph 3 of Exhibit "C" Tenant shall
be responsible for the costs that exceed the Tenant Allowance as shown on
Exhibit "E". Any special decorator items, equipment, furniture or
furnishings not designated on Exhibit "E", shall be the sole cost of
Tenant.
The Construction of Leased Premises as designated in this section
2.3, in Exhibit "C", and Exhibit "E", shall be in accordance with the
minimum Building standard finishes described in Exhibit "F".
2.4 Acknowledgment of Commencement Date. Landlord and Tenant shall
execute a written acknowledgment of the Commencement Date in the form
attached hereto as Exhibit "D".
2.5 Right to Lease Additional Space. As specified in Section 1.1(a)
of this Lease, Landlord is constructing approximately 31,400 rentable
square feet in excess of that Leased by Tenant. Landlord grants Tenant the
right to lease the space on the following terms and conditions:
Tenant shall have the exclusive right to lease the 31,400
rentable square feet through February 28, 2001. Thereafter, Landlord may
lease the space to Tenant or other tenants. If Tenant leases additional
space, it shall be under the same terms and conditions as the Leased
Premises.
(b) In the event that the 31,400 square feet is leased to other
tenants, Landlord warrants that any renewal options to the other tenants
shall be subordinated to Tenant's right to lease the space at the end of
the other tenant's lease term.
2.6 Renewal Option. Tenant shall have the option to renew the Lease
for two (2) terms of five years each.
III. BASIC RENTAL PAYMENTS
3.1 Basic Annual Rent. Tenant agrees to pay to Landlord as basic
annual rent (the "Basic Annual Rent") at such place as Landlord may
designate, without prior demand therefore and without any deduction or set
off whatsoever, the sum of Two Million Eight Hundred Forty Nine Thousand
Three Hundred Forty and 00/100 Dollars ($2,849,340.00). Said Basic Annual
Rent shall be due and payable in twelve (12) equal monthly installments to
be paid in advance on or before the first day of each calendar month during
the term of the Lease. The Basic Annual Rent shall escalate at the
beginning of the 2/nd/ lease year and
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each year thereafter using a 3% annually compounded rate. Simultaneously
with the execution hereof, Tenant has paid to Landlord the first month's
rent, receipt whereof is hereby acknowledged, subject to collection,
however, if made by check. In the event the Commencement Date occurs on a
day other than the first day of a calendar month, then rent shall be paid
on the Commencement Date for the initial fractional calendar month prorated
on a per-diem basis (based upon a thirty (30) day month). The amounts of
Basic Annual Rent set forth above shall be adjusted upon completion of the
building pursuant to changes resulting from the application of the Rent
Formula (Exhibit G).
3.2 Additional Monetary Obligations. Tenant shall also pay as rental
(in addition to the Basic Annual Rent) all other sums of money as shall
become due and payable by Tenant to Landlord under this Lease. Landlord
shall have the same remedies in the case of a default in the payment of
said other sums of money as are available to Landlord in the case of a
default in the payment of one or more installments of Basic Annual Rent.
3.3 Basic Annual Rent During Renewal Term. The Basic Annual Rent
shall escalate by 3% at the start of each year of the renewal term(s).
IV. ADDITIONAL RENT
4.1 Definitions. It is the intent of both parties that the Basic
Annual Rent herein specified shall be absolutely net to the Landlord
throughout the term of this Lease, and that all costs, expenses and
obligations relating to the Building, Property and/or Leased Premises which
may arise or become due during the term shall be paid by Tenant in the
manner hereafter provided.
For purposes of this Part IV and the Lease in general, the
following words and phrases shall have the meanings set forth below:
(a) "Basic Costs" shall mean all actual costs and expenses incurred
by Landlord in connection with the ownership, operation, management and
maintenance of the Building and Property and related improvements located
thereon (the "Improvements"), including, but not limited to, all expenses
incurred by Landlord as a result of Landlord's compliance with any and all
of its obligations under this Lease (or under similar leases with other
tenants) other than the performance by Landlord of its work under Section
2.3 of this Lease or similar provisions of leases with other tenants. In
explanation of the foregoing, and not in limitation thereof, Basic Costs
shall include: all real and personal property taxes and assessments
(whether general or special, known or unknown, foreseen or unforeseen) and
any tax or assessment levied or charged in lieu thereof, whether assessed
against Landlord and/or Tenant and whether collected from Landlord and/or
Tenant; South Jordan City Special Improvement District assessments; snow
removal, trash removal, common area utilities, Utah Power & Light Company
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Finanswer service charge, cost of equipment or devices used to conserve or
monitor energy consumption, supplies, insurance, license, permit and
inspection fees, cost of services of independent contractors, cost of
compensation (including employment taxes and fringe benefits) of all
persons who perform regular and recurring duties connected with day-to-day
operation, maintenance, repair, and replacement of the Building, its
equipment and the adjacent walk and landscaped area (including, but not
limited to janitorial, scavenger, gardening, security, parking, elevator,
painting, plumbing, electrical, mechanical, carpentry, window washing,
structural and roof repairs and reserves, signing and advertising), but
excluding persons performing services not uniformly available to or
performed for substantially all Building tenants; and rental expense or a
reasonable allowance for depreciation of personal property used in the
maintenance, operation and repair of the Building. The foregoing
notwithstanding, Basic Costs shall not include depreciation on the Building
and Improvements; amounts paid toward principal or interest of loans of
Landlord; nor "Direct Costs" as defined in Section 4.1(b) below.
(b) "Direct Costs" shall mean all actual costs and expenses incurred
by Landlord in connection with the operation, management, maintenance,
replacement, and repair of tenants' premises, including but not limited to
janitorial services, maintenance, repairs, supplies, utilities, heating,
ventilation, air conditioning, and property management fees, which property
management fees shall be equal to four and 23/100 percent (4.23%) of the
Basic Annual Rent. Tenant shall pay its share of Direct Costs of the
Building. The amount of Tenant's Direct Costs shall be obtained by
multiplying the expenses in question by a fraction, the numerator of which
shall be the gross rentable square footage of the premises, and the
denominator of which shall be the average rentable square feet leased and
occupied by tenants of the Building during any given year in which the
Direct Costs are then being calculated.
Landlord will cause meters to be installed to measure actual
electrical and ventilation/air conditioning usage by Tenant. Tenant shall
pay Landlord monthly, as additional rent, the estimated costs of such
metered electrical and ventilation/air conditioning usage. At least
annually, Landlord shall reconcile the estimated costs of these metered
services and shall show the actual costs and shall apply any appropriate
credits or debits from the previous year's actual usage. All such xxxxxxxx
will be computed at the actual kilowatt hourly rate billed to the Landlord
by the public utility companies for each respective period, including
taxes, but without any additional xxxx-up or service charges. The costs of
ventilation/air conditioning usage by Tenant shall be equitably apportioned
among all building tenants according to usage. Tenant shall promptly pay to
Landlord the amount due on each monthly billing received for and throughout
the term of the Lease.
(c) "Estimated Costs" shall mean the projected amount of Tenant's
Direct Costs and Tenant's Proportionate Share of Basic Costs, excluding the
costs of electricity and ventilation/air conditioning provided to the
Buildings, if separately metered. The Estimated Costs for the calendar year
in which the Lease commences are $950,000 excluding the costs of
electricity and ventilation/air conditioning to the
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Buildings, and are not included in the Basic Annual Rent. The Estimated
Costs are based on 200,000 rentable square feet and a $4.75 per rentable
square foot cost. If the Estimated Costs as of the date Tenant takes
occupancy are greater than Estimated Costs at the time this Lease is
executed, the Estimated Costs shall be increased to equal the Estimated
Costs as of the date of Tenant's occupancy.
(d) "Tenant's Proportionate Share of Basic Costs" shall mean the
percentage of the Estimated Costs provided to the Buildings derived by
multiplying the Estimated Costs times the Tenant's Proportionate Share.
4.2 Report of Basic Costs and Statement of Estimated Costs.
(a) After the expiration of each calendar year occurring during the
term of this Lease, Landlord shall furnish Tenant a written statement of
the Tenant's Proportionate Share of Basic Costs and the Tenant's Direct
Costs occurring during the previous calendar year. The written statement
shall specify the amount by which Tenant's Direct Costs and Proportionate
Share of Basic Costs exceeds or is less than the amounts paid by Tenant
during the previous calendar year pursuant to Section 4.3(b) below.
(b) At the same time specified in Section 4.2(a) above, Landlord
shall furnish Tenant a written statement of the Estimated Costs for the
then current calendar year.
4.3 Payment of Additional Rent. Tenant shall pay as additional rent
("Additional Rent") Tenant's Direct Costs and Tenant's Proportionate Share
of Basic Costs. The Additional Rent shall be paid as follows:
(a) With each monthly payment of Basic Annual Rent due pursuant to
Section 3.1 above, Tenant shall pay to Landlord, without offset or
deduction, one-twelfth (l/12th) of the Estimated Costs as defined in
Section 4.1(c).
(b) Within thirty (30) days after delivery of the written statement
referred to in section 4.2(a) above, Tenant shall pay to Landlord the
amount by which Tenant's Direct Costs and Proportionate Share of Basic
Costs, as specified in such written statements, exceed the aggregate of
Estimated Costs actually paid by Tenant for the year at issue. Payments by
Tenant shall be made pursuant to this Section 4.3(b) notwithstanding that a
statement pursuant to Section 4.2(a) is furnished to Tenant after the
expiration of the term of this Lease.
(c) If the annual statement of costs indicates that the Estimated
Costs paid by Tenant pursuant to Section 4.3(a) above for any year exceeded
Tenant's Direct Costs and Tenant's Proportionate Share of Basic Costs for
the same year, Landlord, at Tenant's election, shall either (i) promptly
pay the amount of such
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excess to Tenant, or (ii) apply such excess against the next installment of
Basic Annual Rental or Additional Rent due hereunder.
4.4 Exclusions. Notwithstanding anything to the contrary contained
herein, Basic Costs and Direct Costs shall not include: 1) original
construction costs of the Building; 2) interest and amortization of funds
borrowed by Landlord, whether secured or unsecured; 3) reserves for
repairs, maintenance and replacements (unless approved by Tenant); 4) costs
or expenses associated with leasing space in the Building or the sale of
any interest in the Building, including, without limitation, advertising
and marketing, commissions or any amounts paid for or on behalf of a tenant
such as space planning, moving costs, rental and other tenant concessions;
5) ground rents; 6) salaries, wages or other compensations paid to
employees of any property management organization whose salaries are deemed
covered by a management fee (i.e., property manager, accounting or clerical
personnel); 7) amounts paid to any partners, shareholder, officer or
director of Landlord, for salary or other compensation; 8) repairs or other
work occasioned by fire, windstorm, or other casualty covered by building
insurance; 9) expenses for repairs, replacements or improvements arising
from the initial construction of the Building to the extent such expenses
are either (i) reimbursed to Landlord by virtue of warranties from
contractors or suppliers or (ii) result by reason of deficiencies in design
or workmanship except conditions resulting from ordinary wear and tear; 10)
Landlord's general overhead except to the extent it is expended in direct
connection with management and operation of the Building of which the
Leased Premises forms a part; 11) accounting or legal fees incurred in
tenant disputes, or in procuring tenants, or for fees not related to the
operation and maintenance of the Building but personal to Landlord; 12)
advertising and promotional activities; 13) leasing commissions, attorney's
fees, costs, and disbursements and other expenses incurred in connection
with negotiations or disputes with tenant, other occupants, or prospective
tenant or other occupants; 14) all costs shall be "net" only and shall be
reduced by the amount of insurance, condemnation awards or other
reimbursement, recoupment, payment, discount, warrantee, guarantee or
allowance received by Landlord; 15) costs of renovating or otherwise
improving space for new tenants or in renovating space vacated by any
tenant or any other work which Landlord performs for any tenant; 16) costs
relating to maintaining Landlord's existence, either as a corporation,
partnership or other entity, such as trustee's fees, annual fees,
partnership organization or administration expenses, deed recordation
expenses, legal and accounting fees (other than with respect to Building
operations); 17) capital improvements to the Building, except those items
that need replacement due to Tenant's occupancy of the Leased Premises; 18)
depreciation of the Building or any equipment, machinery, fixtures or
improvements therein; 19) any costs related to Landlord's compliance in the
Building common areas with the Americans with Disabilities Act; 20) costs
incurred due to Landlord's violation of any term or condition of this Lease
or any law, ordinance or governmental rule or regulation affecting the
Building; 21) costs for acquisitions of sculpture, paintings or other
objects of art, unless approved by Tenant; 22) title insurance, automobile
insurance, key man and other life insurance, long-term disability insurance
and health, accident and sickness insurance, excepting only group plans
providing reasonable benefits to persons of the grade of building manager
and below employed in the operation and management of the Building
(provided that the cost of
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insurance with respect to any such employee dividing his or her time
between the Building and any other buildings shall be apportioned pro rate
among all such buildings); 23) any expense that would not be considered a
normal maintenance or operating expense; 24) any inheritance, estate,
succession, transfer, gift tax or capital levy shall not be included in
Real Estate Taxes; and 25) costs of any items for which Landlord receives
reimbursement from insurance proceeds or a third party. Insurance proceeds
shall be excluded from Operating Expenses in the year in which they are
received, except that any deductible amount under any insurance policy
shall be included within Operation Expenses.
4.5 Resolution of Disagreement. Every statement given by Landlord
pursuant to Section 4.2 shall be conclusive and binding upon Tenant unless
within ninety (90) days after the receipt of such statement Tenant shall
notify Landlord that it disputes the correctness thereof, specifying the
particular respects in which the statement is claimed to be incorrect. If
such dispute shall not have been settled by agreement, the parties hereto
shall submit the dispute to arbitration within ninety (90) days after
Tenant's receipt of such statement. Pending the determination of such
dispute by agreement or arbitration as aforesaid, Tenant shall, within
thirty (30) days after receipt of such statement, pay Additional Rent in
accordance with Landlord's statement, and such payment shall be without
prejudice to Tenant's position. If the dispute shall be determined in
Tenant's favor, Landlord shall forthwith pay Tenant the amount of Tenant's
overpayment of rents resulting from compliance with Landlord's statement.
Landlord agrees to grant Tenant reasonable access to Landlord's books and
records for the purpose of verifying operating expenses incurred by
Landlord.
4.6 Landlord Duty to Keep Books for Audit. Landlord agrees to keep
accurate books and records reflecting Basic Costs and Direct Costs and to
make such records, and reasonable supporting detail available for
examination during normal business hours upon reasonable notice by Tenant
and its representatives; provided that any such examination or audit shall
be at Tenant's sole cost and expense, unless the audit discloses a
discrepancy of 10% or more per line item then Landlord shall be responsible
for the cost of the audit. In addition, if the audit discloses any
overpayment by Tenant, the overpayment shall be promptly repaid to Tenant
together with interest at the rate of two percent (2%) above prime per
annum.
Landlord shall, at all times during the entire term and its
options, operate, manage, maintain and repair the Building in a lawful,
efficient and businesslike manner in accordance with sound property
management practices consistent with comparable first class buildings in
the area. Landlord shall not expend more than the reasonable and fair
market value for any goods, services, labor or materials purchased or
provided by Landlord in connection with the management, operation
maintenance and repair of the Building. Tenant shall only be liable for
Basic Costs and Direct Costs incurred by Tenant which are attributable to
the term of this Lease or such time as Tenant occupies the Leased Premises,
whichever is greater.
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4.7 Limitations. Nothing contained in this Part IV shall be construed
at any time so as to reduce the monthly installments of Basic Annual Rent
payable hereunder below the amount set forth in Section 3.1 of this Lease.
V. SECURITY DEPOSIT
5.1 Deposit. Intentionally Deleted.
5.2 Default. Intentionally Deleted
VI. USE
6.1 Use of Leased Premises. The Leased Premises shall be used and
occupied by Tenant for general office purposes only which shall include
computer room, training, conferences, and direct marketing and for no other
purpose whatsoever without the prior written consent of Landlord.
6.2 Prohibition of Certain Activities or Uses. The Tenant shall not
do or permit anything to be done in or about, or bring or keep anything in
the Leased Premises which is prohibited by this Lease or will, in any way
or to any extent:
(a) Adversely affect any fire, liability or other insurance policy
carried with respect to the Building, the Improvements or any of the
contents of the Building (except with Landlord's express written
permission, which will not be unreasonably withheld, but which may be
contingent upon Tenant's agreement to bear any additional costs, expenses
or liability for risk that may be involved).
(b) Obstruct or interfere with any right of any other tenant or
occupant of the Building or injure or annoy such persons;
(c) Conflict with or violate any law, statute, ordinance, rule,
regulation or requirement of any governmental unit, agency or authority
(whether existing or enacted as promulgated in the future, known or
unknown, foreseen or unforeseen).
(d) Adversely overload the floors or otherwise damage the structural
soundness of the Leased Premises or Building, or any part thereof (except
with Landlord's express written permission, which will not be unreasonably
withheld, but which may be contingent upon Tenant's agreement to bear any
additional costs, expenses or liability for risk that may be involved).
6.3 Affirmative Obligations with Respect to Use.
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(a) Tenant will comply with all governmental laws, ordinances,
regulations, and requirements, now in force or which hereafter may be in
force, of any lawful governmental body or authorities having jurisdiction
over the Leased Premises, will keep the Leased Premises and every part
thereof in a clean, neat, and orderly condition, free of objectionable
noise, odors, or nuisances, will in all respects and at all times fully
comply with all health and policy regulations, and will not suffer, permit,
or commit any waste.
(b) At all times during the term hereof, Tenant shall, at Tenant's
sole cost and expense, comply with all statutes, ordinances, laws, orders,
rules, regulations and requirements of all applicable federal, state,
county, municipal and other agencies or authorities, now in effect or which
may hereafter become effective, which shall impose any duty upon Landlord
or Tenant with respect to the use, occupation or alterations of the Leased
Premises (including, without limitation, all applicable requirements of the
Americans with Disabilities Act of 1990 and all other applicable laws
relating to people with disabilities, and all rules and regulations which
may be promulgated thereunder from time to time and whether relating to
barrier removal, providing auxiliary aids and services or otherwise) and
upon request of Landlord shall deliver evidence thereof to Landlord.
6.4 Suitability. Tenant acknowledges that except as expressly set
forth in this Lease, neither Landlord nor any other person has made any
representation or warranty with respect to the Leased Premises or any other
portion of the Building, and that no representation has been made or relied
on with respect to the suitability of the Leased Premises or any other
portion of the Building or Improvements for the conduct of Tenant's
business. The Leased Premises, Building and Improvements (and each and
every part thereof) shall be deemed to be in satisfactory condition subject
to the "punch list" prepared at Substantial Completion of the Building and
the Leased Premises. Landlord shall be responsible for correcting any
latent defects during the two (2) year warranty period following Tenant
occupancy, normal wear and tear excepted.
6.5 Taxes. Tenant shall pay all taxes, assessments, charges, and fees
which during the term hereof may be imposed, assessed or levied by any
governmental or public authority against or upon Tenant's use of the Leased
Premises or any personal property or fixture kept or installed therein by
Tenant and on the value of leasehold improvements to the extent that the
same exceed Building allowances.
VII. UTILITIES AND SERVICE
7.1 Obligation of Landlord. During the term of this Lease the
Landlord agrees to cause to be furnished to the Building 24 hours per day,
365 days per year the following utilities and services, the cost and
expense of which shall be included in Basic and/or Direct Costs:
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(a) Electricity, water, gas and sewer service.
(b) Telephone connection, but not including telephone stations and
equipment (it being expressly understood and agreed that Tenant shall be
responsible for the ordering and installation of telephone lines and
equipment which pertain to the Leased Premises).
(c) Elevator service.
7.2 Obligation of Landlord. During the term of this Lease the
Landlord agrees to cause to be furnished to the Leased Premises during
customary business hours (7:00 a.m. to 6:00 p.m. Monday through Friday and
8:00 a.m. to l:00 p.m. on Saturday) and during generally recognized
business days the following services, the cost and expense of which shall
be included in Basic and/or Direct Costs:
(a) Heat and air-conditioning to comply with ASHRAE 1989, so that the
temperature does not exceed 80 (Degrees) F in summer nor fall below
68(Degrees) F in winter. The parties agree and understand that the above
heat and air-conditioning will be provided Monday through Friday from 7:00
a.m. to 6:00 p.m. and Saturday from 8:00 a.m. to 1:00 p.m.
(b) Janitorial service in accordance with specifications attached
hereto as Exhibit "H".
(c) Security (including the lighting of common halls, stairways,
entries and restrooms) to such extent as is usual and customary in similar
buildings in Salt Lake County, Utah.
(d) Snow removal service.
(e) Landscaping and groundskeeping service.
7.3 Tenant's Obligations. Tenant shall arrange for and shall pay the
entire cost and expense of all telephone stations, equipment and use
charges, electric light bulbs (but not fluorescent bulbs used in fixtures
originally installed in the Leased Premises) and all other materials and
services not expressly required to be provided and paid for pursuant to the
provisions of Section 7.1 above.
7.4 Additional Limitations.
(a) Tenant will not, without the written consent of Landlord, which
consent shall not be unreasonably withheld, use any apparatus or device on
the Leased Premises (including but without limitation thereto, electronic
data processing machines, punch card machines or machines using current in
excess of 110 volts) which will in any way or to any extent increase the
amount of electricity or water usually furnished or supplied for use on the
Leased Premises for the use
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designated in Section 6.1 above, nor connect with electrical current,
except through existing electrical outlets in the Leased Premises, or water
pipes, any apparatus or device, for the purposes of using electric current
or water.
(b) If Tenant shall require water or electric current in excess of
that usually furnished or supplied for use of the Leased Premises, or for
purposes other than those designated in Section 6.l above, Tenant shall
first procure the consent of Landlord for the use thereof. If the Building
is a multi-tenant building, the Landlord's consent may require a water
meter or electric current meter to be installed in the Leased Premises, so
as to measure the amount of water and/or electric current consumed for any
such use. The cost of such meters and of installation maintenance, and
repair thereof shall be paid for by Tenant and Tenant agrees to pay
Landlord promptly upon demand by Landlord for all such water and electric
current consumed as shown by said meters, at the rates charged for such
service by the City in which the Building is located or the local public
utility, as the case may be, furnishing the same, plus any additional
expense incurred in keeping account of the water and electric current so
consumed.
(c) If and where heat generating machines devices are used in the
Leased Premises which affect the temperature otherwise maintained by the
air conditioning system, Landlord reserves the right to install additional
or supplementary air conditioning units for the Leased Premises, and the
entire cost of installing, operating, maintaining and repairing the same
shall be paid by Tenant to Landlord promptly after demand by Landlord.
7.5 Limitation on Landlord's Liability. Landlord shall not be liable
for and Tenant shall not be entitled to terminate this Lease or to
effectuate any abatement or reduction of rent by reason of Landlord's
failure to provide or furnish any of the foregoing utilities or services if
such failure was reasonably beyond the control of Landlord. In no event
shall Landlord be liable for loss or injury to persons or property,
however, arising or occurring in connection with or attributable to any
failure to furnish such utilities or services even if within the control of
Landlord. Notwithstanding anything to the contrary contained herein, if
Tenant cannot reasonably use any portion of the Leased Premises for
Tenant's normal business operations by reason of any interruption in
services within Landlord's reasonable control and such condition exists for
three (3) consecutive business days, then Tenant's rent shall be equitably
abated from the date of such occurrence for that portion of the Leased
Premises that Tenant is unable to occupy until such service is restored and
Tenant is able to use the Leased Premises.
Notwithstanding the above, in the event Landlord needs to perform
work in the Leased Premises which will interfere with the Tenant's normal
course of business, then Landlord shall use its best efforts to perform
such work and clean up the area after Tenant's business hours and prior to
the Tenant's next day of business.
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VIII. MAINTENANCE AND REPAIRS; ALTERATIONS; ACCESS
8.1 Maintenance and Repairs by Landlord. Landlord shall maintain in
good order, condition and repair the Building, Base Building Systems, and
Improvements in accordance with Class A office buildings in suburban Salt
Lake City, except the Leased Premises and those other portions of the
Building leased, rented or otherwise occupied by persons not affiliated
with the Landlord. Base Building Systems includes, but is not limited to,
the Building enclosure, the roof, HVAC system, plumbing, sprinklers, fire
alarm, elevators, and electrical systems (which may be routed through the
Leased Premises). Landlord shall supply normal janitorial and cleaning
services reasonably required to keep the Leased Premises and the Building
and Improvements in a clean, sanitary and orderly condition. The cost and
expense of this maintenance and repair by Landlord shall be included in
Direct and/or Basic Costs.
8.2 Maintenance and Repairs by Tenant. Tenant, at Tenant's sole cost
and expense and without prior demand being made, shall maintain the Leased
Premises in good order, condition and repair, and will be responsible for
the painting, carpeting or other interior design work of the Leased
Premises beyond the initial construction phase as specified in Section 2.3
and Exhibit "C" and "E" of the Lease and shall maintain all equipment and
fixtures installed by Tenant. If repainting or recarpeting is required and
authorized by Tenant, the cost for such are the sole obligation of Tenant
and shall be paid for by Tenant immediately following the performance of
said work and a presentation of an invoice for payment.
8.3 Alterations. Except as set forth on Exhibit "C" attached hereto,
Tenant shall not make or cause to be made any alterations, additions or
improvements or install or cause to be installed any fixtures, signs, floor
coverings, interior or exterior lighting, plumbing fixtures, or shades or
awnings, or make any other changes to the Leased Premises without first
obtaining Landlord's written approval, which approval shall not be
unreasonably withheld. Tenant shall present to the Landlord plans and
specifications for such work at the time approval is sought. In the event
Landlord consents to the making of any alterations, additions, or
improvements to the Leased Premises by Tenant, the same shall be made by
Tenant at Tenant's sole cost and expense. All such work with respect to any
alterations, additions, and changes shall be done in a good and workmanlike
manner and diligently prosecuted to completion such that, except as
absolutely necessary during the course of such work, the Leased Premises
shall at all times be a complete operating unit. Any such alterations,
additions, or changes shall be performed and done strictly in accordance
with all laws and ordinances relating thereto. In performing the work or
any such alterations, additions, or changes, Tenant shall have the same
performed in such a manner as not to obstruct access to any portion of the
Building. Any alterations, additions, or improvements to or of the Leased
Premises, including, but not limited to, wallcovering, paneling, and built-
in cabinet work, but excepting movable furniture and equipment, shall at
once become a part of the realty and shall be surrendered with the Leased
Premises unless Landlord otherwise elects at the end of the term hereof.
Notwithstanding the above, decorating items shall not require notice to, or
consent of Landlord. In the event Landlord does not respond
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to Tenant's written request for consent within ten (10) days, consent shall
be deemed given. Landlord shall not charge any supervisory fee for
alterations.
8.4 Landlord's Access to Leased Premises. Landlord shall have the
right to place, maintain, and repair all utility equipment of any kind in,
upon, and under the Leased Premises as may be necessary for the servicing
of the Leased Premises and other portion of the Building. Landlord shall
upon providing adequate notice to Tenant, also have the right to enter the
Leased Premises at all times to inspect or to exhibit the same to
prospective purchasers, mortgagees, tenants, and lessees, and to make such
repairs, additions, alterations, or improvements as Landlord may deem
desirable. Landlord shall be allowed to take all material upon said Leased
Premises that may be required therefor without the same constituting an
actual or constructive eviction of Tenant in whole or in part and the rents
reserved herein shall in no wise xxxxx while said work is in progress by
reason of loss or interruption of Tenant's business or otherwise, and
Tenant shall have no claim for damages. During the three (3) months prior
to expiration of this Lease or of any renewal term, Landlord may place upon
the Leased Premises "For Lease" or "For Sale" signs which Tenant shall
permit to remain thereon.
IX. ASSIGNMENT
9.1 Assignment Prohibited. Tenant shall not transfer, assign,
mortgage, or hypothecate this Lease, in whole or in part, or permit the use
of the Leased Premises by any person or persons other than Tenant, or
sublet the Leased Premises, or any part thereof, without the prior written
consent of Landlord in each instance, which consent shall not be
unreasonably withheld, provided sufficient information is provided to
Landlord to accurately represent the financial condition of those to whom
this Lease will be transferred, assigned, mortgaged, or hypothecated. Such
prohibition against assigning or subletting shall include any assignment or
subletting by operation of law. Notwithstanding anything to the contrary
contained herein, Tenant may assign this lease or sublet all or any portion
of the Leased Premises, with Landlord's written consent, which shall not be
unreasonably withheld, to any corporation or other business entity which
(1) controls, is controlled by, or is under common control with Tenant or
(2) is a successor corporation related to Tenant by merge, consolidation,
non-bankruptcy reorganization or government action (herein referred to as a
"Related Corporation") for any of the purposes permitted to Tenant, subject
however to compliance with Tenant's obligations under this lease. Any such
assignment or subletting shall not be deemed to relieve, release, impair or
discharge any of Tenant's obligations thereunder. For the purposes hereof,
"control" shall be deemed to mean ownership of not less than fifty percent
(50%) of all of the voting stock of such corporation or not less than fifty
percent (50%) of all of the legal and equitable interest in any other
business entities. The sale of Tenant's capital stock through any public
exchange shall not be deemed a sublease, assignment or transfer of this
Lease.
9.2 Consent Required:
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(a) Any assignment or subletting without Landlord's consent shall be
void, and shall constitute a default hereunder which, at the option of
Landlord, shall result in the termination of this Lease or exercise of
Landlord's other remedies hereunder. Consent to any assignment or
subletting shall not operate as a waiver of the necessity for consent to
any subsequent assignment or subletting, and the terms of such consent
shall be binding upon any person holding by, under, or through Tenant.
(b) Landlord shall have no obligation to consent to the proposed
sublease or assignment if the proposed sublessee or assignee or its
business is or may be subject to compliance with additional requirements of
the law, including any related rules or regulations, commonly known as the
"Americans with Disabilities Act of l990" or similar state or local laws
relating to persons with disabilities beyond those requirements which are
applicable to the tenant desiring to so sublease or assign, unless Tenant
pays the cost of the compliance with such additional rules or regulations.
9.3 Landlord's Right in Event of Assignment If this Lease is assigned
or if the Leased Premises or any portion thereof are sublet or occupied by
any person other than the Tenant, Landlord may collect rent and other
charges from such assignee or other party, and apply the amount collected
to the rent and other charges reserved hereunder, but such collection shall
not constitute consent or waiver of the necessity of consent to such
assignment, subleasing, or other transfer, nor shall such collection
constitute the recognition of such assignee, sublessee, or other party as
the Tenant hereunder or a release of Tenant from the further performance of
all of the covenants and obligations, including obligation to pay rent, of
Tenant herein contained. In the event that Landlord shall consent to a
sublease or assignment hereunder, Tenant shall pay to Landlord reasonable
fees, not to exceed $100.00, incurred in connection with processing of
documents necessary to the giving of such consent.
9.4 Sublease and Assignments Rights The above paragraphs of this
Section 9 not withstanding, Tenant shall have the right to sublet or assign
all or part of the Leased Premises without Landlord's prior consent to any
and all affiliates, subsidiaries, sister companies, or any entity in which
Tenant or Tenant's parent company has a controlling interest, provided
Tenant is not relieved of its obligations under the lease.
For non-affiliated companies, Landlord shall not unreasonably
withhold, condition or delay the approval of any and all proposed sublease
or assignment, provided proposed sublessor has the same or better financial
condition as Tenant. Tenant shall retain any and all profits from a
sublease or assignment. Tenant's foregoing Rights of Sublease and
Assignment shall apply to the initial lease term and any renewal terms.
9.5 Right to Sublet and Retain Profit. Any profits from subleasing
shall be retained by Tenant. Landlord may not withhold its consent on the
grounds that the proposed assignee or sublessee is an occupant of the
building or office park. Landlord shall
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provide sublessee and/or assignees all rights and services provided for in
Tenant's Lease. Landlord shall not be entitled to any sublease profits nor
shall Landlord have a right of recapture.
X. INDEMNITY
10.1 Indemnification By Landlord and Tenant. From and after the
Commencement Date, Landlord and/or Tenant shall defend and indemnify the
other and save the other harmless from and against any and all suits,
actions, damage and claims, liability and expense in connection with loss
of life, bodily or personal injury, or property damage arising from or out
of any occurrence in, upon, at or from the Leased Premises, or occasioned
wholly or in part by any act or omission of the other or its agents,
contractors, employees, servants, invitees, licensees or concessionaires.
All insurance policies carried by Tenant and/or Landlord shall include a
waiver of subrogation endorsement which specifies that the insurance
carrier(s) will waive any right of subrogation against Tenant and/or
Landlord arising out of any insurance claim.
10.2 Release of Landlord. Landlord shall not be responsible or
liable at any time for any loss or damage to Tenant's personal property or
to Tenant's business, including any loss or damage to either the person or
property of Tenant that may be occasioned by or through the acts or
omissions of persons occupying adjacent, connecting, or adjoining space.
Tenant shall store its property in and shall use and enjoy the Leased
Premises and all other portions of the Building and Improvements at its own
risk, and hereby releases Landlord, to the full extent permitted by law,
from all claims of every kind resulting in loss of life, personal or bodily
injury, or property damage.
10.3 Notice. Tenant shall give prompt notice to Landlord in case of
fire or accidents in the Leased Premises or in the Building of which the
Leased Premises are a part or of defects therein or in any fixtures or
equipment.
10.4 Litigation. In case Landlord or Tenant, without fault on its
part, shall be made a party to any litigation commenced by or against
Tenant or Landlord, then Tenant or Landlord shall protect and hold the
other party harmless and shall pay all costs, expenses, and reasonable
attorneys' fees.
XI. INSURANCE
11.1 Insurance on Tenant's Personal Property and Fixtures. At all
times during the term of this Lease, Tenant shall keep in force at its sole
cost and expense, hazardous insurance with special causes of loss including
theft coverage, insuring against fire and extended coverage risks
(including vandalism and malicious mischief) in companies acceptable to
Landlord, equal to the replacement cost of Tenant's fixtures, furnishings,
equipment, and contents upon the Leased Premises and all improvements or
additions made
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by Tenant to the Leased Premises. The Landlord shall be named as a loss
payer on all such policies.
11.2 Property Coverage. Landlord shall obtain and maintain in force
"All Risk" insurance, including vandalism and malicious mischief, required
to cover any loss or destruction that the Leased Premises herein may
experience during the Lease period and any extension thereof, and
including, at Landlord's discretion, flood and earthquake coverage if
commercially available at reasonable rates. Such insurance shall also
include coverage against loss of rents. Tenant shall pay Landlord, as a
separate consideration, all reasonable costs to purchase the insurance
called for in this paragraph on the Leased Premises.
11.3 Liability Insurance. Tenant shall, during the entire term
hereof, keep in full force and effect a policy of public liability and
property damage insurance with respect to the Leased Premises and the
business operated by Tenant in the Leased Premises, with a combined single
limit for personal or bodily injury and property damage of not less than
$1,000,000.00. The policy shall name Landlord, any person, firms, or
corporations designated by Landlord, and Tenant as insureds, and shall
contain a clause that the insurer will not cancel or materially change the
insurance pertaining to the Leased Premises without first giving Landlord
ten (10) days' written notice. Tenant shall at all times during the term
hereof provide Landlord with evidence of current insurance coverage. All
public liability, property damage, and other liability policies shall be
written as primary policies, not contributing with coverage which Landlord
may carry. All such policies shall contain a provision that Landlord,
although named as an insured, shall nevertheless be entitled to recover
under said policies for any loss occasioned to it, its servants, agents,
and employees by reason of the negligence of Tenant. All such insurance
shall specifically insure the performance by Tenant of the indemnity
agreement as to liability for injury to or death of persons or injury or
damage to property contained in Part X.
11.4 Waiver of Subrogation. Landlord and Tenant waive all rights to
recover against each other, against any other tenant or occupant of the
Building and against the officers, directors, shareholders, partners, joint
venturers, employees, agents, customers, invitees or business visitors of
each other or of any other tenant or occupant of the Building, for any loss
or damage arising from any cause covered by any insurance carried by the
waiving party, to the extent that such loss or damage is actually covered.
No party shall have any right or claim against any of Landlord's
agents for any property damage (whether caused by negligence or the
condition of the Leased Premises or the Building or any part thereof) by
way of subrogation or assignment, Tenant hereby waiving and relinquishing
any such right. Tenant shall obtain a valid certificate of insurance or
similar document from its insurance company verifying this waiver of
subrogation for that property that Tenant chooses to insure. Landlord
hereby waives and relinquishes any right or claim against Tenant from
damages to the Leased Premises or Building by way of subrogation or
assignment by Landlord. At Tenant's request, Landlord
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shall obtain a valid certificate of insurance verifying this waiver of
subrogation for that property Landlord chooses to insure.
11.5 Lender. Any mortgage lender interest in any part of the
Building or Improvements may, at Landlord's option, be afforded coverage
under any policy required to be secured by Tenant hereunder, by use of a
mortgagee's endorsement to the policy concerned.
XII. DESTRUCTION
If the Leased Premises shall be partially damaged by any casualty insured
against under any insurance policy maintained by Landlord, Landlord shall,
upon receipt of the insurance proceeds, repair the Leased Premises and
until repair is complete the Basic Annual Rent and Additional Rent shall
be abated proportionately as to that portion of the Leased Premises
rendered untenantable. Notwithstanding the foregoing, if: (a) the Leased
Premises by reason of such occurrence are rendered wholly untenantable, or
(b) the Leased Premises should be damaged as a result of a risk which is
not covered by insurance, or (c) the Leased Premises should be damaged in
whole or in part during the last six (6) months of the term or of any
renewal hereof, or (d) the Leased Premises or the Building (whether the
Leased Premises are damaged or not) should be damaged to the extent of
fifty percent (50%) or more of the then-monetary value thereof, then and
in any such events, Landlord may either elect to repair the damage or may
cancel this Lease by notice of cancellation within sixty (60) days after
such event and thereupon this Lease shall expire, and Tenant shall vacate
and surrender the Leased Premises to Landlord. Tenant's liability for rent
upon the termination of this Lease shall cease as of the day following
Landlord's giving notice of cancellation. In the event Landlord elects to
repair any damage, any abatement of rent shall end five (5) days after
notice by Landlord to Tenant that the Leased Premises have been repaired.
In the event Landlord elects to repair any damage, Landlord shall give
notice to Tenant within sixty (60) days of the occurrence and such notice
shall include a schedule for the completion of the repairs. Unless this
Lease is terminated by Landlord, Tenant shall repair and refixture the
interior of the Leased Premises in a manner and in at least a condition
equal to that existing prior to the destruction or casualty and the
proceeds of all insurance carried by Tenant on its property and fixtures
shall be held in trust by Tenant for the purpose of said repair and
replacement. During the repair of the Leased Premises, Landlord shall
grant Tenant access to refixture and install furniture as needed.
XIII. CONDEMNATION
13.1 Total Condemnation. If the whole of the Leased Premises shall
be acquired or taken by condemnation proceeding, then this Lease shall
cease and terminate as of the date of title vesting in such proceeding.
13.2 Partial Condemnation. If any part of the Leased Premises shall
be taken as aforesaid, and such partial taking shall render that portion
not so taken unsuitable for the
19
business of Tenant, then this Lease shall cease and terminate as aforesaid.
If such partial taking is not extensive enough to render the Leased
Premises unsuitable for the business of Tenant, then this Lease shall
continue in effect except that the Basic Annual Rent and Additional Rent
shall be reduced in the same proportion that the portion of the Leased
Premises (including basement, if any) taken bears to the total area
initially demised and Landlord shall, upon receipt of the award in
condemnation, make all necessary repairs or alterations to the Building in
which the Leased Premises are located, provided that Landlord shall not be
required to expend for such work an amount in excess of the amount received
by Landlord as damages for the part of the Leased Premises so taken.
"Amount received by Landlord" shall mean that part of the award in
condemnation which is free and clear to Landlord of any collection by
mortgage lenders for the value of the diminished fee.
13.3 Landlord's Option to Terminate. If more than twenty percent
(20%) of the Building shall be taken as aforesaid, Landlord may, by written
notice to Tenant, terminate this Lease. If this Lease is terminated as
provided in this Section, rent shall be paid up to the day that possession
is so taken by public authority and Landlord shall make an equitable refund
of any rent paid by Tenant in advance.
13.4 Award. Tenant shall not be entitled to and expressly waives all
claim to any condemnation award for any taking, whether whole or partial
and whether for diminution in value of the leasehold or to the fee,
although Tenant shall have the right, to the extent that the same shall not
reduce Landlord's award, to claim from the condemnor, but not from the
Landlord, such compensation as may be recoverable by Tenant in its own
right for damages to Tenant's business and fixtures.
13.5 Definition. As used in this Part XIII the term "condemnation
proceeding" means any action or proceeding in which any interest in the
Leased Premises is taken for any public or quasi-public purpose by any
lawful authority through exercise of eminent domain or right of
condemnation or by purchase or otherwise in lieu thereof.
XIV. LANDLORD'S RIGHTS TO CURE
14.1 General Right. In the event of breach, default, or
noncompliance hereunder by Landlord, Tenant shall, before exercising any
right or remedy available to it, give Landlord written notice of the
claimed breach, default, or noncompliance. If prior to its giving such
notice Tenant has been notified in writing (by way of Notice of Assignment
of Rents and Leases, or otherwise) of the address of a lender which has
furnished any of the financing referred to in Part XV hereof, concurrently
with giving the aforesaid notice to Landlord, Tenant shall, by certified
mail, return receipt requested, transmit a copy thereof to such lender. For
the thirty (30) days following the giving of the notice(s) required by the
foregoing portion of this section (or such longer period of time as may be
reasonably required to cure a matter which, due to its nature, cannot
reasonably be rectified within thirty (30) days, Landlord shall have the
right to cure the breach, default, or noncompliance involved. If Landlord
has failed to cure a default within said period, any such lender shall
20
have an additional thirty (30) days within which to cure the same or, if
such default cannot be cured within that period, such additional time as
may be necessary if within such thirty (30) day period said lender has
commenced and is diligently pursuing the actions or remedies necessary to
cure the breach default, or noncompliance involved (including, but not
limited to, commencement and prosecution of proceedings to foreclose or
otherwise exercise its rights under its mortgage or other security
instrument, if necessary to effect such cure), in which event this Lease
shall not be terminated by Tenant so long as such actions or remedies are
being diligently pursued by said lender. Following the thirty (30) day
notice period to Landlord, Tenant may perform such obligation(s) for or on
behalf of the Landlord or make good any such default after three (3)
business days written notice to Landlord, and any cost incurred by Tenant
shall be repaid by Landlord to Tenant, within 30 days after receipt of an
invoice.
14.2 Mechanic's Lien. Should any mechanic's or other lien be filed
against the Leased Premises or any part thereof by reason of Tenant's acts
or omissions or because of a claim against Tenant, Tenant shall cause the
same to be canceled and discharged of record by bond or otherwise within
ten (10) days after notice by Landlord.
XV. FINANCING; SUBORDINATION
15.1 Subordination. Tenant acknowledges that it might be necessary
for Landlord or its successors or assigns to secure mortgage loan financing
or refinancing affecting the Leased Premises. Tenant also acknowledges that
the lender interested in any given loan may desire that Tenant's interest
under this Lease be either superior or subordinate to the mortgage then
held or to be taken by said Lender. Accordingly, Tenant agrees that at the
request of Landlord at any time and from time to time Tenant shall execute
and deliver to Landlord an instrument, in form reasonably acceptable to
Landlord, whereby Tenant subordinates its interest under this Lease and in
the Leased Premises to any first mortgage or deed of trust covering the
Leased Premises (a "Mortgage"); provided, however, that any such instrument
or subordination executed by Tenant shall provide that so long as Tenant
continues to perform all of its obligations under this Lease its tenancy
shall remain in full force and effect notwithstanding Landlord's default in
connection with the Mortgage concerned or any resulting foreclosure or sale
or transfer in lieu of such proceedings. Tenant shall not subordinate its
interests hereunder or in the Leased Premises to any lien or encumbrance
other than the Mortgages described in and specified pursuant to this
Section 15.1 without the prior written consent of Landlord and of the
lender interested under each Mortgage then affecting the Leased Premises.
Any such unauthorized subordination by Tenant shall be void and of no force
or effect whatsoever.
15.2 Amendment. Tenant recognizes that Landlord's ability from time
to time to obtain construction, acquisition, standing, and/or permanent
mortgage loan financing for the Building and/or the Leased Premises may in
part be dependent upon the acceptability of the terms of this Lease to the
lender concerned. Accordingly, Tenant agrees that from time to time it
shall, if so requested by Landlord and if doing so will not substantially
and adversely
21
affect Tenant's economic interests hereunder join with Landlord in amending
this Lease so as to meet the needs or requirements of any lender which is
considering making or which has made a loan secured by a Mortgage affecting
the Leased Premises.
15.3 Attornment. Any sale, assignment, or transfer of Landlord's
interest under this Lease or in the Leased Premises including any such
disposition resulting from Landlord's default under a Mortgage, shall be
subject to this Lease and also Tenant shall attorn to Landlord's successor
and assigns and shall recognize such successor or assigns as Landlord under
this Lease, regardless of any rule of law to the contrary or absence of
privity of contract.
15.4 Financial Information. As a condition to Landlord's acceptance
of this Lease, Tenant shall provide financial information sufficient to
verify to Landlord the financial condition of Tenant. Tenant hereby
represents and warrants that none of such information contains or will
contain any untrue statement of material fact, nor will such information
omit any material fact necessary to make the statements contained therein
misleading or unreliable.
15.5 Non-Disturbance Agreement. Landlord shall obtain a Non-
Disturbance Agreement for the benefit of Tenant from the holders of any
current or future encumbrances against the Building, including but not
limited to, mortgages, deeds or trusts and ground leases and any holders of
interests superior to Tenant. Such non-disturbance agreement shall be in
form and content then used by such holder, but shall provide, among other
things, that so long as Tenant is not in default in the payment of rent or
any other material covenant or condition of this lease, (i) its rights as
Tenant hereunder shall not be affected or terminated, (ii) its possession
of the demised premises shall not be disturbed, (iii) no action or
proceeding shall be commenced to remove or evict Tenant, and (iv) this
lease shall continue in full force and effect notwithstanding the
foreclosure of the mortgage prior to the expiration or termination of this
lease.
XVI. EVENTS OF DEFAULT; REMEDIES OF LANDLORD
16.1 Default by Tenant. Upon the occurrence of any of the following
events, Landlord shall have the remedies set forth in Section 16.2:
(a) Tenant fails to pay any installment of Basic Annual Rent or
Additional Rent or any other sum due hereunder within ten (10) days after
Tenant receives written notice of rent due.
(b) Tenant fails to perform any other term, condition, or covenant
to be performed by it pursuant to this Lease within ten (10) days after
written notice of such default shall have been given to Tenant by Landlord
or, if cure would reasonably require more than ten (10) days to complete,
if Tenant fails to commence
22
performance within the ten (10) day period or fails diligently to pursue
such cure to completion.
(c) Tenant or any guarantor of this Lease shall become bankrupt or
insolvent or file any debtor proceedings or have taken against such party
in any court pursuant to state or federal statute, a petition in
bankruptcy or insolvency, reorganization, or appointment of a receiver or
trustee; or Tenant petitions for or enters into an arrangement; or suffers
this Lease to be taken under a writ of execution.
16.2 Remedies. In the event of any default by Tenant hereunder,
Landlord may at any time, without waiving or limiting any other right or
remedy available to it, terminate Tenant's rights under this Lease by
written notice, reenter and take possession of the Leased Premises by any
lawful means (with or without terminating this Lease), or pursue any other
remedy allowed by law. Tenant agrees to pay to Landlord the cost of
recovering possession of the Leased Premises, all costs of reletting, and
all other costs and direct damages arising out of Tenant's default,
including reasonable attorneys' fees. Notwithstanding any reentry, the
liability of Tenant for the rent reserved herein shall not be extinguished
for the balance of the Term, and Tenant agrees to compensate Landlord upon
demand for any deficiency arising from reletting the Leased Premises at a
lesser rent than applies under this Lease.
16.3 Past Due Sums; Penalty. If Tenant fails to pay, when the same
is due and payable, any Basic Annual Rent, Additional Rent, or other sum
required to be paid by it hereunder, such unpaid amounts shall bear
interest from the due date thereof to the date of payment at a fluctuating
rate equal to two percent (2%) per annum above the prime rate of interest
charged by First Security Bank of Utah, Salt Lake City, Utah. In addition
thereto, Tenant shall pay a sum of five percent (5%) of such unpaid
amounts as a service fee. Notwithstanding the foregoing, however,
Landlord's right concerning such interest and service fee shall be limited
by the maximum amount which may properly be charged by Landlord for such
purposes under applicable law. Twice each calendar year, Landlord shall
grant Tenant a five (5) day grace period in case of late payment of Basic
Annual Rent and Additional Rent.
XVII. PROVISIONS APPLICABLE AT TERMINATION OF LEASE
17.1 Surrender of Premises. At the expiration of this Lease, except
for changes made by Tenant that were approved by Landlord, Tenant shall
surrender the Leased Premises in the same condition, less reasonable wear
and tear, as they were in upon delivery of possession thereto under this
Lease and shall deliver all keys to Landlord. Before surrendering the
Leased Premises, Tenant shall remove all of its personal property and
trade fixtures and such property or the removal thereof shall in no way
materially damage the Leased Premises, and Tenant shall be responsible for
all costs, expenses and damages incurred in the removal thereof. If Tenant
fails to remove its personal property and fixtures
23
upon the expiration of this Lease, the same shall be deemed abandoned and
shall become the property of Landlord.
17.2 Removal of Trade Fixtures and Improvements. At the expiration
of the term, Tenant may remove movable walls, Tenant's trade fixtures,
furniture, rooftop satellite equipment, A/V equipment (including screen,
monitors, projectors) and Tenant's interior security system.
17.3 Holding Over. Any holding over after the expiration of the term
hereof or of any renewal term with the prior written consent of Landlord
shall be construed to be a tenancy from month to month. Tenant shall pay
holdover rent equal to the then current Basic Annual Rent for three
months, and thereafter the Basic Annual Rent shall be increased by 25%.
XVIII. ATTORNEYS' FEES
In the event that at any time during the term of this Lease either
Landlord or the Tenant institutes any action or proceeding against the other
relating to the provisions of this Lease or any default hereunder, then the
unsuccessful party in such action or proceeding agrees to reimburse the
successful party for the reasonable expenses of such action including reasonable
attorneys' fees, incurred therein by the successful party.
XIX. ESTOPPEL CERTIFICATE
19.1 Landlord's Right to Estoppel Certificate Tenant shall, within
fifteen (15) days after Landlord's request, execute and deliver to
Landlord a written declaration, in form and substance similar to Exhibit
"D", in recordable form: (1) ratifying this Lease; (2) expressing the
Commencement Date and expiration date hereof; (3) certifying that this
Lease is in full force and effect and has not been assigned, modified,
supplemented or amended (except by such writing as shall be stated); (4)
that all conditions under this Lease to be performed by Landlord have been
satisfied; (5) that there are no defenses or offsets against the
enforcement of this Lease by the Landlord, or stating those claimed by
Tenant; (6) the amount of advance rental, if any, (or none if such is the
case) paid by Tenant; (7) the date to which rental has been paid; (8) the
amount of security deposited with Landlord; and (9) such other information
as Landlord may reasonably request. Landlord's mortgage lenders and/or
purchasers shall be entitled to rely upon such declaration.
19.2 Effect of Failure to Provide Estoppel Certificate. Tenant's
failure to furnish any Estoppel Certificate within fifteen (15) days after
request therefor shall be deemed a default hereunder and moreover, it
shall be conclusively presumed that: (a) this Lease is in full force and
effect without modification in accordance with the terms set forth in the
24
request; (b) that there are no unusual breaches or defaults on the part of
the Landlord; and (c) no more than one (1) month's rent has been paid in
advance.
XX. COMMON AREAS
20.1 Definition of Common Areas. "Common Areas" means all areas,
space, equipment and special services provided for the joint or common use
and benefit of the tenants or occupants of the Building and Property or
portions thereof, and their employees, agents, servants, patients,
customers, and other invitees (collectively referred to herein as
"Occupants") including without limitation, parking, access roads,
driveways, retaining walls, landscaped areas, serviceways, loading docks,
pedestrian walks; courts, stairs, ramps, and sidewalks; common corridors,
rooms and restrooms; air-conditioning, fan, janitorial, electrical and
telephone rooms or closets; and all other areas within the Building which
are not specified for exclusive use or occupancy by Landlord or any tenant
(whether or not they are leased or occupied).
20.2 License to Use Common Areas. The Common Areas shall be
available for the common use of all Occupants and shall be used and
occupied under a revocable license. If any such areas shall be changed or
diminished, and provided the changes do not materially affect Tenant's
ability to conduct its normal business in the Leased Premises, Landlord
shall not be subject to any liability nor shall Tenant be entitled to any
compensation or diminution or abatement of rent nor shall revocation or
diminution of such areas be deemed constructive or actual eviction. All
Common Areas shall be subject to the exclusive control and management of
Landlord. Landlord shall have the right to construct, maintain, and operate
lighting and other facilities on all said areas and improvements; to police
the same; to change the area, level, location, and arrangement of parking
areas and other facilities; to restrict parking by non-tenants; to close
all or any portion of said areas or facilities to such extent as may be
legally sufficient to prevent a dedication thereof or the accrual of any
right to any person or the public therein; and to close temporarily any
portion of the parking areas to discourage non-occupant parking. Landlord
shall operate and maintain the Common Areas in such manner as Landlord in
its discretion shall determine, shall have full right and authority to
employ and discharge all personnel with respect thereto, and shall have the
right, through reasonable rules, regulations, and/or restrictive covenants
promulgated by it from time to time, to control use and operation of the
Common Areas in order that the same may occur in a proper and orderly
fashion.
20.3 Parking. Automobiles of Tenant and all Occupants (as defined
above) associated with Tenant shall be parked only within parking areas not
otherwise reserved by Landlord. Landlord or its agents shall, without any
liability to Tenant or its Occupants, have the right to cause to be removed
any automobile that may be wrongfully parked in a prohibited or reserved
parking area, and Tenant agrees to indemnify, defend and hold Landlord
harmless from and against any and all claims, losses, demands, damages and
liabilities asserted or arising with respect to or in connection with any
such removal of an automobile.
25
XXI. SIGNS, AWNINGS, AND CANOPIES
21.1 General Rights. Tenant shall not place or suffer to be placed
or maintained on any exterior door, wall, or window of the Leased
Premises, or elsewhere in the Building, any sign, awning, marquee,
decoration, lettering, attachment, or canopy, or advertising matter or
other thing of any kind, and will not place or maintain any decoration,
lettering, or advertising matter on the glass of any window or door of the
Leased Premises without first obtaining Landlord's written approval.
Tenant further agrees to maintain such sign, awning, canopy, decoration,
lettering, advertising matter, or other things, as may be approved, in
good condition and repair at all times. Landlord may, after five (5)
business days notice to Tenant, at Tenant's cost, and without liability to
Tenant, enter the Leased Premises and remove any item erected in violation
of this Section. Landlord may establish rules and regulations governing
the size, type, and design of all signs, decorations, etc., and Tenant
agrees to abide thereby.
21.2 Exclusive Rights. Tenant shall have exclusive building and
monument signage rights for the Building. Tenant shall have non-exclusive
signage rights on the Jordan Valley Technology Center monument sign
located on the easternmost part of the property.
XXII. MISCELLANEOUS PROVISIONS
22.1 No Partnership. Landlord does not by this Lease, in any way or
for any purpose, become a partner or joint venturer of Tenant in the
conduct of its business or otherwise.
22.2 Force Majeure. Landlord shall be excused for the period of any
delay in the performance of any obligations hereunder when prevented from
so doing by cause or causes beyond Landlord's control, including labor
disputes, civil commotion, war, governmental regulations or controls, fire
or other casualty, unforeseen material shortages, or acts of God.
22.3 No Waiver. Failure of Landlord to insist upon the strict
performance of any provision or to exercise any option hereunder shall not
be deemed a waiver of such breach. No provision of this Lease shall be
deemed to have been waived unless such waiver be in writing signed by
Landlord.
22.4 Notice. Any notice, demand, request, or other instrument which
may be or is required to be given under this Lease shall be delivered in
person or sent by United States certified or registered mail, postage
prepaid and shall be addressed (a) if to Landlord, at the place specified
for payment of rent, which is set forth below, and (b) if to Tenant,
either at the Leased Premises or at any other current address for Tenant
which is known to Landlord,
26
including the address set forth below. Either party may designate such
other address as shall be given by written notice.
Landlord: Xxxxx Xxxxxx Xxxxxx 0, X.X.
c/o The Xxxxx Company
000 Xxxxx 000 Xxxx, Xxxxx 000
Xxxx Xxxx Xxxx, Xxxx 00000
(000) 000-0000
Tenant: TenFold Corporation
000 Xxxx Xxxxxxxx Xxxx
Xxxxxx, Xxxx 00000
(000) 000-0000
22.5 Captions; Attachments; Defined Terms
(a) The captions to the section of this Lease are for convenience of
reference only and shall not be deemed relevant in resolving questions of
construction or interpretation under this Lease.
(b) Exhibits referred to in this Lease, and any addenda and
schedules attached to this Lease shall be deemed to be incorporated in this
Lease as though part thereof.
22.6 Recording. Tenant may not record this Lease or a memorandum
thereof without the written consent of Landlord, which consent shall not be
unreasonably withheld. Landlord, at its option and at any time, may file
this Lease for record with the Recorder of the County in which the Building
is located.
22.7 Partial Invalidity. If any provision of this Lease or the
application thereof to any person or circumstance shall to any extent be
invalid, the remainder of this Lease or the application of such provision
to persons or circumstances other than those as to which it is held invalid
shall not be affected thereby and each provision of this Lease shall be
valid and enforced to the fullest extent permitted by law.
22.8 Broker's Commissions. Tenant represents and warrants that other
than Xxxxx & Xxxxx and Colliers Commerce CRG there are no claims for
brokerage commissions or finder's fees in connection with this Lease and
agrees to indemnify Landlord against and hold it harmless from all
liabilities arising from any other such claims, including any attorneys'
fees connected therewith.
22.9 Tenant Defined. Use of Pronouns. The word "Tenant" shall be
deemed and taken to mean each and every person or party executing this
document as a Tenant herein. If there is more than one person or
organization set forth on the signature line as the Tenant, their liability
hereunder shall be joint and several. If there is more than one Tenant,
any
27
notice required or permitted by the terms of this Lease may be given by
or to any one thereof, and shall have the same force and effect as if given
by or to all thereof. The use of the neuter singular pronoun to refer to
Landlord or Tenant shall be deemed a proper reference even though Landlord
or Tenant may be an individual, a partnership, a corporation, or a group of
two or more individuals or corporations. The necessary grammatical changes
required to make the provisions of this Lease apply in the plural sense
where there is more than one Landlord or Tenant and to corporations,
associations, partnerships, or individuals, males or females, shall in all
instances be assumed as though in each case fully expressed.
22.10 Provisions Binding, Etc. Except as otherwise provided, all
provisions herein shall be binding upon and shall inure to the benefit of
the parties, their legal representative, heirs, successors, and assigns.
Each provision to be performed by Tenant shall be construed to be both a
covenant and a condition, and if there shall be more than one Tenant, they
shall all be bound, jointly and severally, by such provisions. In the
event of any sale or assignment (except for purposes of security or
collateral) by Landlord of the Building, the Leased Premises, or this
Lease, Landlord shall, from and after the Commencement Date (irrespective
of when such sale or assignment occurs), be entirely relieved of all of its
obligations hereunder.
22.11 Entire Agreement, Etc. This Lease and the Exhibits, Riders,
and/or Addenda, if any, attached hereto, constitute the entire agreement
between the parties. Any guaranty attached hereto is an integral part of
this Lease and constitutes consideration given to Landlord to enter in this
Lease. Any prior conversations or writings are merged herein and
extinguished. No subsequent amendment to this Lease shall be binding upon
Landlord or Tenant unless reduced to writing and signed. Submission of
this Lease for examination does not constitute an option for the Leased
Premises and becomes effective as a lease only upon execution and delivery
thereof by Landlord to Tenant. If any provision contained in the rider or
addenda is inconsistent with a provision in the body of this Lease, the
provision contained in said rider or addenda shall control. It is hereby
agreed that this Lease contains no restrictive covenants or exclusives in
favor of Tenant. The captions and Section numbers appearing herein are
inserted only as a matter of convenience and are not intended to define,
limit, construe, or describe the scope or intent of any section or
paragraph.
22.12 Governing Law. The interpretation of this Lease shall be
governed by the laws of the State of Utah. Tenant hereby expressly and
irrevocably agrees that Landlord may bring any action or claim to enforce
the provisions of this Lease in the State of Utah, County of Salt Lake, and
the Tenant irrevocably consents to personal jurisdiction in the State of
Utah for the purposes of any such action or claim. Tenant further
irrevocably consents to service of process in accordance with the
provisions of the laws of the State of Utah. Nothing herein shall be
deemed to preclude or prevent Landlord from bringing any action or claim to
enforce the provisions of this Lease in any other appropriate place or
forum.
28
22.13 Recourse by Tenant. Anything in this Lease to the contrary
notwithstanding, Tenant agrees that it shall look solely to the estate and
property of Landlord in the land, Buildings and Improvements thereto, and
subject to prior rights of any mortgagee, for the collection of any
judgment (or other judicial process) requiring the payment of money by
Landlord in the event of any default or breach by Landlord with respect to
any of the terms, covenants, and conditions of this Lease to be observed
and/or performed by Landlord, and no other assets of Landlord or any of its
partners, shareholders, successors, or assigns shall be subject to levy,
execution, or other procedures for the satisfaction of Tenant's remedies.
22.14 Choice of Law. This Lease shall be governed by and construed
in accordance with the laws of the State of Utah.
22.15 Waiver of Right to Jury Trial. Landlord and Tenant waive their
respective rights to trial by jury of any contract or tort claim,
counterclaim, cross-complaint, or cause of action in any action,
proceeding, or hearing brought by either party against the other on any
matter arising out of or in any way connected with this Lease, the
relationship of Landlord and Tenant, or Tenant's use or occupancy of the
Leased Premises, including any claim of injury or damage or the enforcement
of any remedy under any current or future law, statue, regulation, code, or
ordinance.
22.16 Arbitration. Where arbitration provisions apply, arbitration
procedures shall be "baseball" where the arbitrator accepts one of the
parties' claims without modification and rejects the other party's claim
entirely.
22.17 Tenant's Personal Property. Notwithstanding anything in this
Lease to the contrary under no circumstances shall Landlord have any lien
or possessory interest in Tenant's equipment and personal property.
22.18 Hazardous Substances. Landlord represents and warrants, as of
the date of commencement of this Lease that the Leased Premises will be
free of asbestos and all hazardous materials as described by Federal, State
and Local regulations and on behalf of itself and its successors and
assigns hereby covenants and agrees to use and operate the Building and
Property at all times during the term hereof, or any extensions, under and
in compliance with any and all laws or rules, regulations, or other legal
requirements regarding hazardous substances or other environmental matters
and shall indemnify, defend and hold Tenant harmless from and against any
and all loss, cost, liability, damage or expense, including reasonable
attorney's fees, which Tenant may incur, sustain or which may be asserted
against Tenant by reason of Landlord's failure to comply with all such laws
or regulations.
Notwithstanding the above, Tenant shall indemnify, defend and
hold Landlord harmless from and against any and all loss, cost liability,
damage or expense including reasonable attorney's fees, which Landlord may
incur or sustain or which may be asserted against Landlord by reason of any
liability Landlord may incur for clean up,
29
restoration costs, fines, or penalties resulting from the violation of any
environmental law or regulation caused by Tenant, its employees, agents and
contractors, arising out of Tenant's use of the Premises. Tenant shall
operate its business in the Leased Premises in compliance with all
environmental laws or regulations including but not limited to obtaining
all required permits or licenses, if any, when required.
IN WITNESS WHEREOF, the Landlord and Tenant have executed this Lease on the
date first set forth above.
LANDLORD: XXXXX XXXXXX VALLEY 1, L.C., BY
ITS MANAGING PARTNER,
THE XXXXX COMPANY, L.C.
By: /s/ Xxx X. Xxxxxxx
------------------------------
Xxx X. Xxxxxxx
President and Manager
TENANT: TENFOLD CORPORATION
By: /s/ Xxxxxx X. Xxxxxx
------------------------------
Xxxxxx X. Xxxxxx
Its: Chief Financial Officer
30
NOTARY
STATE OF UTAH )
) ss
COUNTY OF SALT LAKE )
On this 28 day of April, 2000, personally appeared before me XXX X.
XXXXXXX, who duly acknowledged to me that he executed the foregoing Lease as the
PRESIDENT AND MANAGER of XXXXX XXXXXX VALLEY 1, L.C., BY ITS MANAGING PARTNER,
THE XXXXX COMPANY, L.C., A UTAH LIMITED LIABILITY COMPANY.
My commission Expires: /s/ Xxxxxxxx Xxxxxx
---------------------------------
Notary Public
4/28/01 Residing at SALT LAKE COUNTY
[SEAL]
STATE OF UTAH )
) ss
COUNTY OF UTAH )
On this 28 day of April, 2000, personally appeared before me XXXXXX X.
XXXXXX, who being duly sworn, did say that he is the CHIEF FINANCIAL OFFICER of
Tenfold Corporation, a Delaware Corporation, and that said instrument was signed
in behalf of said corporation by authority of its by-laws or a resolution of its
Board of Directors, and said XXXXXX X. XXXXXX acknowledged to me that said
corporation executed the same.
My Commission Expires: /s/ Xxxxxx Xxxxxxx
---------------------------------
Notary Public
3-15-2004 Residing at Sandy, UT
---------------------- ---------------------
[SEAL]
31
EXHIBIT "A"
LEGAL DESCRIPTION OF PROPERTY
-----------------------------
Jordan Valley Technology Center
LOT No. 1 Boundary
Beginning at a point which lies South 89?32'26" East 183.61 feet and South
00?27'34" West perpendicular to the north line of the southwest quarter of
section 12, T3S., R1W., S.L.B.&M., 75.67 feet, from the West quarter corner of
said section 12, ( a found brass cap ),
said point also lies on the westerly boundary of the Pheasant Hollow Business
Park; thence along said boundary line the following (7) seven courses:
1.) South 10?46'37"East 407.04 feet to a found rebar,
2.) Xxxxx 00?00'00" Xxxx 407.94 feet to a found rebar,
3.) Xxxxx 00?00'00" Xxxx 192.46,
4.) South 27?32'55" East 114.91 feet,
5.) Xxxxx 00?00'00" Xxxx 29.65 feet,
6.) South 83?32'07" East 128.83 feet
7.) Xxxxx 00?00'00" Xxxx 375.76 feet to a point which lies on the Northerly
right of way line of the proposed 00000 Xxxxx xxxxxx; thence along said
boundary line the following (6) six courses:
1.) North 89?46'10" West 406.21 feet to the beginning of a 2.) curve to the
right having a central
of 35?13'30", radius of 667.00 feet, (chord bears North 72?09'25" West 403.64
feet), thence along the Arc of said curve 410.07 feet; 3.) thence North
54?32'40" West 259.04 feet to the beginning of a 4.) curve to the right, having
a central angle of 15?39'15", radius of 967.00 feet, ( chord bears North
46?43'02" West 263.38 feet), thence along the Arc of said curve 264.20 feet;
5.) thence North 38?53'25" West 119.58 feet to the beginning of a 6.) Curve to
the left, having a central angle of 7?56'11", radius of 508.00 feet, (chord
bears North 42?51'30"West 70.31 feet ), thence along the Arc of said curve 70.37
feet to a point which lies on the Phase Boundary line of the Jordan Valley
Technology Center; thence along said phase line North 32?53'27" East 729.04 feet
to the Point of Beginning.
Said Tract of land contains 14.925 acres more or less.
A-1
EXHIBIT "B"
Floorplan of Leased Premises
----------------------------
[FLOOR PLAN APPEARS HERE]
B-1
SECOND FLOORPLAN
----------------
[FLOOR PLAN APPEARS HERE]
B-2
THIRD FLOORPLAN
---------------
[FLOOR PLAN APPEARS HERE]
B-3
FOURTH FLOORPLAN
----------------
[FLOOR PLAN APPEARS HERE]
B-4
FIFTH FLOORPLAN
---------------
[FLOOR PLAN APPEARS HERE]
B-5
EXHIBIT "C"
WORK LETTER
-----------
CONSTRUCTION AND/OR FINISHING OF
IMPROVEMENTS TO LEASED PREMISES
In accordance with the provisions of the body of the Lease to which this
Exhibit "C" is attached, the improvements to the Leased Premises shall be
constructed and/or finished (as the case may be) in the manner described, and
upon all of the terms and conditions contained in the following portion of this
Exhibit "C."
I. GENERAL DESCRIPTION OF WORK:
---------------------------
A. LANDLORD'S CONSTRUCTION OBLIGATION: Landlord's construction obligation
----------------------------------
respecting improvements to the Leased Premises shall consist of the following
described items or elements of work (where more than one type of material,
structure, or method is indicated, Landlord shall have the option of selecting
or employing any thereof):
1. STRUCTURAL:
----------
(a) Frame: The building shall be of steel or concrete frame,
-----
reinforced concrete, or bearing wall construction designed in
accordance with the applicable building code.
(b) Exterior Walls: Insulated exterior walls of the building shall
--------------
be of masonry, concrete, or such other material(s) as may be selected
by Landlord's architect.
(c) Floor: Floor shall be of concrete slab.
-----
2. BASE BUILDING: The Landlord shall provide the Tenant a building
-------------
shell consistent with a Class "A" multi-tenant office building including the
following as part of the base building shell and parking: Landscaping, site
identification, elevators, elevator lobbies, toilets, stairwells, elevator
machine rooms, mechanical rooms, electrical rooms, main lobby, loading
docks, and janitorial closets on Leased Premises floors. Landlord warrants
that the Building and the Leased Premises are being constructed in
compliance with the current 1989-62 ASHRAE Air Quality Standards.
3. UTILITIES:
---------
(a) Water and Sewer: Water and sewer service shall be furnished to
---------------
the toilet rooms on the floors of the Leased Premises.
C-1
(b) Electricity: Electrical service shall be provided to panels on
-----------
the floors of the Leased Premises, capable of providing 7 xxxxx per
rentable square foot over the entire area.
4. HEATING, AIR CONDITIONING, AND SPRINKLERS:
-----------------------------------------
(a) Air Conditioning and Heating: HVAC trunk lines shall be
----------------------------
provided to the floor area. No distribution or controls shall be
provided by Landlord.
(b) Sprinklers: Automatic sprinkler system, if and to the extent
----------
required by the applicable code, shall be installed in the Leased
Premises.
B. TENANT'S LEASEHOLD IMPROVEMENT REQUEST: The work to be performed by
--------------------------------------
Landlord in satisfying its obligations respecting construction of improvements
to the Leased Premises shall be limited to that described in the foregoing
Section. The Landlord, as Tenant's agent, shall construct the Tenant
Improvements in accordance with drawings and specifications prepared by the
Tenant and reasonably approved by the Landlord ("Tenant's Plans"). Tenant may
elect to negotiate with the Base Building contractor or bid the Tenant
Improvements. If directed by Tenant, the Landlord shall competitively bid the
Approved Plans to not less than three (3) qualified general contractors. The
Tenant shall have the right to review the list of qualified general contractors
prior to bidding and to remove from the list any general contractor which the
Tenant reasonably believes is unsatisfactory to perform the work. The Tenant
and Landlord shall open the bids together and adjust the bids for
inconsistencies and/or qualification, and the Tenant shall select the contractor
("Tenant Contractor") with the lowest responsive bid. Subject to Tenant's right
to modify the scope of the Tenant Improvements set forth in Section 3 of this
Exhibit "C," Tenant's Leasehold Improvement Request respecting improvements to
the Leased Premises shall include, but not necessarily be limited to, the
purchase, installation, and/or performance (as the case may be) of the following
described items or elements of work:
1. Tenant's Electric Fixtures and Equipment: All electrical work and
----------------------------------------
distribution related to Tenant's Improvements from Base Building panels.
2. Tenant's Telephone: All arrangements for telephone service and all
------------------
conduits for telephone wires in the Leased Premises.
3. Walls: All interior partitioning and drywall on all party or the
-----
walls surrounding the Leased Premises.
4. Doors: All interior doors and door frames.
-----
5. Floor Covering: All floor covering and floor materials other than
--------------
concrete.
6. Alarm System: Any alarm systems or other protective devices within
------------
the Leased Premises.
C-2
7. Demising Walls: Demising walls (i.e., walls dividing the Leased
--------------
Premises for areas, if any, in the same building occupied by other lessees)
shall be of steel stud or masonry.
8. Special Plumbing and Water Heater: All extra plumbing (either
--------------------------------
roughing-in or fixtures) required for Tenant's special needs and any water
heater required.
9. Special Ventilation: All ventilation and related equipment not
------------------
installed under Landlord's Construction Obligation.
10. Special Equipment: All special equipment such as conveyors,
-----------------
lifts, etc.
11. Painting: All interior painting.
--------
12. Ceiling: The following shall be furnished and installed:
-------
suspended type ceiling using pre-formed panels; drywall blown acoustical
tile ceilings; light coves and specially hung or furred ceiling.
13. Tenant's Distribution System: All low pressure ducting
----------------------------
distribution, controls and diffusers.
II. PLANS
-----
A. LANDLORD'S PLANS: Landlord shall furnish, construct and install the
----------------
items and elements comprising Landlord's Construction Obligation substantially
in accordance with the plans, specifications, and working drawings applicable
thereto (hereinafter referred to as "Landlord's Plans") prepared by the
architectural firms of Studios Architecture and MHTN Architects as Landlord's
Plans may be changed or modified from time to time.
B. TENANT'S PLANS: Landlord and Tenant shall collaborate in preparation
--------------
of complete plans and specifications (hereinafter referred to as "Tenant's
Plans") detailing the work and elements comprising Tenant's Leasehold
Improvement Request. Tenant shall submit such Plans to Landlord for written
approval (not to be unreasonably withheld.) The approval by Landlord of
Tenant's Plans for work to be performed in the Leased Premises shall in no way
create any responsibility or liability on the part of Landlord for their
completeness, design sufficiency or compliance with any and all laws, rules and
regulations of federal, state, county and municipal agencies or authorities.
Any objections by Landlord to the Tenant's Plans and the reason therefore shall
be given to Tenant within ten (10) business days of receipt of Tenant's Plans.
Tenant shall complete or cause to have completed the Tenant's Plans within
ninety (90) days of receipt of complete and accurate Base Building plans and
specifications. If Tenant fails within the ninety (90) day period after
receiving the necessary Base Building information from Landlord to furnish to
Landlord Tenant's Plans, Landlord shall have the right to terminate the Lease
five (5) days after written notice to Tenant (without prejudice to any right
Landlord may have against Tenant for damages arising out of Tenant's failure).
C-3
III. CONSTRUCTION
------------
A. COMPETITIVE BIDDING: At Tenant's option Landlord shall either (i)
--------------------
have no less than three (3) general contractors reasonably approved by Tenant
and Landlord provide competitive bids to construct the Leased Premises or (ii)
select a general contractor of Tenant's choice (with Landlord's reasonable
approval) to negotiate a Cost Plus Fee Contract and to procure three competitive
bids on all trades of subcontractor work.
B. COMPLETION BY LANDLORD: Landlord shall construct and complete all the
----------------------
items or elements or work entering into Landlord's Construction Obligation as
soon as reasonably possible, but in no event later than Eighteen (18) months
after the date of the Lease. In the event Landlord's Construction Obligations
have not been fulfilled upon the expiration of said Eighteen (18) month period,
Tenant shall have the right to exercise any right or remedy available to it
under applicable law, except that under no circumstances shall Landlord be
liable to Tenant for any incidental or consequential loss or damage to Tenant
resulting from delay in construction. All of the items or elements of work
entering into Landlord's Construction Obligation shall be furnished,
constructed, and installed substantially in accordance with those portions of
Tenant's Plans applicable thereto. Landlord shall not be liable for any latent,
patent, or observable defects in such improvements after such acceptance by
Tenant. Landlord does, however, warrant the work performed hereunder by
Landlord against latent defects discovered at any time during the one (1) year
period following the time of such acceptance by Tenant.
C. TENANT'S LEASEHOLD IMPROVEMENT REQUEST: At such time as construction
-------------------------------------
has progressed to a suitable point, Landlord, or Landlord's architect or
supervising contractor, shall notify Tenant in writing that work on the items or
elements entering into Tenant's Leasehold Improvement Request may begin. Upon
receipt of such notice, Tenant shall promptly commence and thereafter shall
diligently pursue to completion all of the matters entering into Tenant's
Leasehold Improvement Request, and such matters shall be performed or
accomplished in accordance with the applicable law, in a good and workmanlike
manner, by contractors approved in writing by Landlord, and in such manner as to
maintain harmonious and suitable labor relations and working conditions. Tenant
shall timely obtain all licenses or permits required for the work performed by
Tenant.
Tenant's Leasehold Improvement Request shall include, but not be
limited to telephone and data cabling, security system, furniture, telephone and
data equipment, audio/visual wiring and equipment, white noise system, signage
and computers.
Tenant shall, at Landlord's request, furnish Landlord with a bond or
bonds assuring payment to all those furnishing labor, materials, or services in
connection with Tenant's Leasehold Improvement Request. Any work or change
which Tenant desires to accomplish and which is not reflected by Tenant's Plans
shall be subject to Landlord's prior written approval (not to be unreasonably
withheld). Upon completion of Tenant's Leasehold Improvement Request, Tenant
shall furnish to Landlord a complete set of "as built" plans and specifications
for the items and elements entering into Tenant's Leasehold Improvement Request.
C-4
D. INTERRELATIONSHIP OF WORK: In performing its Leasehold Improvement
-------------------------
Request, Tenant shall comply with all directions of Landlord or Landlord's
contractor so as to coordinate its construction activities with those being
pursued by others (whether on the Leased Premises or elsewhere in the Building,
and whether by Landlord or by other tenants). Any improvements or items of
equipment installed by Tenant which are to be visible from outside of the Leased
Premises shall be finish painted by Tenant in accordance with Landlord's
standard paint schedule. All work performed by Tenant shall leave Landlord's
structure as strong or stronger than original design and with finishes
unimpaired. Any roofing or flashing work accomplished by Tenant shall conform
to original work and shall be performed at Tenant's expense by Landlord's
roofing subcontractor who installed the original roof. Either party hereto may
examine and inspect the work of the other at any reasonable time and shall
promptly give notice of any observed defects.
1. TENANT'S CONTRACTORS/VENDORS: Tenant shall have the right to
----------------------------
retain its own contractors or vendors to perform any portion of the work
necessary to construct and outfit the Leased Premises (which will not be
part of the general contractor's scope of work nor shall a xxxx-up be
added). The Tenant's contractors'/vendors' work shall include, but not be
limited to: data cabling, telephone and data equipment, security,
audio/visual equipment, white noise, and furniture systems. Tenant's
contractors/vendors and Landlord's Building and Tenant Improvement
contractor(s) shall work in harmony during the construction of the Tenant
Improvements. Tenant and Tenant's contractors/vendors shall have access to
the Leased Premises during the construction to install cabling and for the
purpose of inspecting the work in progress.
2. ROOF PENETRATIONS: Tenant agrees that neither it nor its
-----------------
contractors or employees will, during the construction of the Leased
Premises or at any time during the term of this Lease, make or cause to be
made in the roof of the Premises any penetration whatsoever without first
obtaining the prior written approval from Landlord. Tenant acknowledges
that Landlord may require Tenant to use Landlord's designated roofing
contractor to perform or supervise any roof cuts or penetrations to which
Landlord may agree or give its consent.
In the event Tenant fails to observe this condition, Landlord may
hire a roofing contractor of its choice to inspect any penetrations in the
roofing material over the Demised Premises and to perform any needed
modifications or corrections to the roof surface or its components in order
to preserve the integrity of the roof structure. Landlord may xxxx Tenant
for the expenses of any such roof inspection and/or repairs, plus a 20%
overhead fee for such work. Tenant agrees to pay for said inspection and/or
repairs immediately upon presentation of said invoice.
3. HEATING/VENTILATING/AIR CONDITIONING DISTRIBUTION AND CONTROL
-------------------------------------------------------------
WORK: In order to insure that the rooftop mechanical equipment, originally
-----
provided by the Landlord, will work efficiently and effectively to provide
the specified heating, ventilating and/or cooling to the Leased Premises,
Tenant agrees and
C-5
covenants that prior to its installation of any duct work, distribution
equipment, controls or other related components of the mechanical system, it
will first obtain from Landlord or from Landlord's designated mechanical
contractor, written approval of its plans for same.
E. PAYMENT: Landlord shall furnish, construct, and complete all of the
-------
matters entering into Landlord's Construction Obligation at its own cost and
expense. Landlord, as Tenant's agent, shall furnish, construct and complete all
of the matters entering Tenant's Leasehold Improvement Request at its own cost
and expense up to the amount of the Tenant Allowance specified below. All fees
of Tenant's architect or engineer shall be paid by Tenant.
1. Landlord agrees to provide a Tenant Allowance of $843,000 based on
$5.00 per rentable square foot times 168,600 rentable square feet.
2. This Tenant Allowance shall be provided in accordance with the
following conditions:
(i) All items of work specifically listed or implied under
Tenant's Leasehold Improvement Request shall be certified complete by
Landlord and Tenant;
(ii) Any such invoices with the necessary certification shall be
forwarded to the Landlord for consideration and payment;
(iii) If such work is found to be complete as certified, Landlord
shall remit to the supplier of all such certified materials and/or
labor thus invoiced, a total amount due within thirty (30) days.
(iv) The above notwithstanding, Landlord shall not be obligated to
remit final payment prior to its receipt of the following documents:
l. A Certificate of Occupancy from the municipality
involved;
2. A signed copy of Exhibit "D" of this Lease as defined in
Section 2.2, or an equivalent document provided by Landlord and as
required by lender;
3. A copy of Liability Insurance or Certificate of Insurance
as defined in Section 11; and
4. All copies of necessary lien waivers involved with any
general or subcontractors involved with Tenant's Leasehold
Improvement Request.
(v) No personal property shall be included as part of the Tenant
Allowance.
C-6
3. Subject to the last sentence of this Section 3, all expenses arising
by reason of Tenant's Leasehold Improvement Request in excess of the Tenant
Allowance shall be borne exclusively by the Tenant. Not later than May 15,
2000, Tenant shall deposit into an escrow account reasonably acceptable to
Landlord, an additional sum of Fifteen Dollars ($15.00) per rentable square
foot or Two Million Five Hundred Twenty Nine Thousand Dollars
($2,529,000.00) for a portion of the cost of Tenant's Leasehold Improvement
Request. Subject to the last sentence of this Section 3, Tenant shall pay
or cause the payment from the escrow account to the Landlord any excess
costs related to Tenant Improvements that exceed the Tenant Allowance on a
pro-rata basis with each Tenant Improvement monthly construction draw.
Landlord shall provide Tenant with an anticipated schedule of monthly draw
amounts. To the extent that at any time the cost of Tenant's Leasehold
Improvement Request, as modified pursuant to the next sentence, is less
than the sum of the Tenant Allowance plus amounts disbursed from escrow to
pay the cost of Tenant's Leasehold Improvement Request, the balance shall
immediately be returned to Tenant. Tenant may reduce the cost or scope of
Tenant's Leasehold Improvement Request with the consent of Landlord, which
consent shall not be withheld if the Tenant's Improvements comply with
applicable law and reasonable engineering and design practices for a Class
"A" office building, but any reduction shall not affect Tenant's obligation
to open for business in the Leased Premises or to pay Basic Annual Rent,
Additional Rent or other rents and charges. If, however, Tenant defaults in
performing any obligation under the Lease prior to full disbursement of the
escrow account, Landlord shall have a security interest in any amounts
remaining in escrow to secure payment of any damages finally determined to
be owing by Tenant. Except to the extent more extensive Tenant Improvements
are approved by Tenant, Tenant shall not be responsible to pay more than
Two Million Five Hundred Twenty-Nine Thousand Dollars ($2,529,000.00) for
its portion of the Tenant Leasehold Improvement Request and Landlord shall
not be obligated to pay more than Eight Hundred Forty-Three Thousand
Dollars ($843,000.00) for Tenant Improvements. In no event shall Tenant be
obligated to pay any amount of cost overruns for items other than Tenant
Leasehold Improvement Requests.
F. ACCURATE DRAWINGS: Landlord shall supply to Tenant a full set in both
-----------------
hard copy and on electronic media in a format acceptable by Tenant, of accurate
as-built architectural and engineering drawings.
G. PUNCH LIST PENALTY: If the punch list items are not completed within
------------------
thirty (30) days, then landlord shall collect a penalty from the Tenant
Contractor in the amount of $300.00 for each day thereafter until the punch list
items are completed, and credit Tenant for the amount collected against any
excess Tenant Improvement costs or pay such amount to Tenant.
C-7
EXHIBIT "D "
ACKNOWLEDGMENT OF COMMENCEMENT DATE
AND TENANT ESTOPPEL CERTIFICATE
TO: DATE:
RE:________________________________________________________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
Gentlemen:
The undersigned, as Tenant, has been advised that the Lease has been or
will be assigned to you as a result of your financing of the above-referenced
property, and as an inducement therefor hereby confirms the following:
1. That the space leased by Tenant is ________________ rentable square feet.
2. That the Basic Annual Rent is $ ($ per rentable square foot).
3. That it has accepted possession and is in full occupancy of the Premises,
that the Lease is in full force and effect, that Tenant has received no
notice of any default of any of its obligations under the Lease, and that
the Lease Commencement Date is _______________________________________.
4. That other than the attached punch list items, the improvements and space
required to be furnished according to the Lease have been completed and
paid for in all respects, and that to the best of its knowledge, Landlord
has fulfilled all of its duties under the terms, covenants and obligations
of the Lease and is not currently in default thereunder.
5. That the Lease has not been modified, altered, or amended, and represents
the entire agreement of the parties, except as follows:
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
D-1
6. That there are no offsets, counterclaims or credits against rentals, nor
have rentals been prepaid or forgiven, except as provided by the terms of the
Lease.
7. That said rental payments commenced or will commence to accrue on
_____________, and the Lease term expires ___________________________. The
amount of the security deposit and all other deposits paid to Landlord is
$__________________.
8. That Tenant has no actual notice of a prior assignment, hypothecation or
pledge of rents of the Lease, except: ____________________________________
___________________________________________________________________________
______________________.
9. That this letter shall inure to your benefit and to the benefit of your
successors and assigns, and shall be binding upon Tenant and Tenant's
heirs, personal representatives, successors and assigns. This letter shall
not be deemed to alter or modify any of the terms, covenants or obligations
of the Lease.
The above statements are made with the understanding that you will rely on
them in connection with the purchase of the above-referenced property.
Very truly yours,
____________________________________
Date of Signature: _____________ By:_________________________________
D-2
E X H I B I T "E"
------------------
COST TO CONSTRUCT LEASED PREMISES
---------------------------------
TENANT: TENFOLD CORPORATION
SQUARE FOOTAGE: 168,600
ITEM COST ESTIMATE
---- -------------
1.0 General Conditions--Clean up _____________
6.1 Rough Carpentry _____________
6.2 Millwork _____________
7.1 Insulation _____________
7.2 Caulking & Sealants _____________
8.1 Hollowmetal Doors & Frames _____________
Lobby Door Access Controls _____________
8.2 Glazing _____________
9.0 Drywall/Painting/Wall Coverings _____________
9.1 Acoustical _____________
9.2 Flooring _____________
10.0 Specialties _____________
15.0 HVAC _____________
Plumbing _____________
15.1 Fire Protection _____________
16.0 Electrical _____________
17.0 Controls _____________
17.2 Tax _____________
17.3 Fee _____________
TOTAL COST $ 3,372,000
-------------
SOURCES OF FUNDS:
LANDLORD ALLOWANCE
(Section 2.3) $ 843,000
-------------
TENANT ESCROW ACCOUNT $2,529,000
-------------
E-1
E X H I B I T "F"
MINIMUM BUILDING STANDARD FINISHES
----------------------------------
A. FLOORCOVERINGS:
--------------
1. 30 ounce face-weight carpet cut-pile on pad, color to be selected by
Tenant.
2. Designated areas to receive vinyl composite tile made by Xxx Tile,
Avanti type, rubber base on all walls.
X. XXXXX: All interior walls shall be sheetrock 5/8" on metal studs, taped
-----
and ready for paint.
C. DOORS/HARDWARE/GLASS: Doors shall be twenty-minute rated, solid core, oak
--------------------
veneer faced, 7' in height, 3' in width.
Hardware shall be a one-hour rated assembly to include a closure and lock
set on the hallway doors. All other doors to receive passage hardware,
building standard. Exterior doors shall have heavy duty hardware.
Door frames to be 2" face hollow metal frames; frames must comply with
U.B.C. requirements for fire rating.
All interior glass shall be wired, clear. Glass put in by Tenant shall
conform to U.B.C. and C.P.S.C. requirements.
D. LEVELORS: All exterior windows to receive Levelor, Riviera window blinds,
--------
building standard color.
E. PAINT: All sheetrock interior walls and core walls to receive one coat
------
prime, two coats Ameritone; color to be selected by Tenant.
F. PLUMBING/CABINETRY: Laminate base cabinet only with shelving; laminate
------------------
color
F-1
to be selected by Tenant.
G. ELECTRICAL:
----------
1. 2X4 four-tube, recessed, florescent light fixtures with parabolic lens
to produce a lighting level of not less than 75 foot candles lighting
at desk level.
2. One telephone outlet per 200 square feet of usable space.
3. One duplex outlet per 75 square feet of usable space.
4. One light switch per 200 square feet of usable space.
H. HVAC: The Landlord shall provide heating, ventilation and air
----
conditioning on a year-round basis throughout the premises and common
areas. The equipment shall maintain a uniform indoor temperature of 75
degrees F.D.B. in summer and 72 degrees F.D.B. in the winter. Temperature
control shall be automatic and shall maintain temperature set point
plus/minus 2 degrees F. A thermostat control system with no more than
l,000 square foot exterior zones and 3,000 square foot interior zones.
All systems shall conform to local and national codes. HVAC design and
systems selected shall be submitted for review and approval by the Tenant.
Approval by the Tenant does not release the Landlord from his strict
responsibility to ensure furnishing design conditions as stated herein.
I. CEILING TILE: 2x2 Acoustical tile 5/8" fissured tile.
------------
F-2
EXHIBIT "G"
"RENT FORMULA"
--------------
It is the intent of Landlord and Tenant that the Basic Annual Rent
specified is Section 3.1 of the Lease will be adjusted upon project completion.
The Basic Annual Rent specified in Section 3.1 of this Lease is established by
application of the "Rent Formula" to the Initial Project Budget (Exhibit "G-1").
Specifically, the Rent Formula is derived as follows:
1. Multiply the Initial Project Budget by the Tenant's pro-rata share
of the Building as identified in Section 4.1(d) of this Lease.
2. Multiply the product obtained in Subsection 1 by the 13% rate of return
to obtain the Basic Annual Rent.
3. Divide the Basic Annual Rent obtained in subsection (2) by the Tenant's
rentable square feet to obtain the per square foot triple net lease
rate.
No later than ninety (90) days following the Commencement Date, Tenant and
Landlord shall jointly review the actual construction/development costs for the
project and establish the "Final Project Cost".
The Rent Formula shall then be applied to the "Final Project Cost" to
derive the adjusted Basic Annual Rent to be paid by Tenant to Landlord.
Retroactive to the Commencement Date this Basic Annual Rent shall be paid in
lieu of the amount specified in Section 3.1 of the Lease.
G-1
EXHIBIT "G-1"
INITIAL PROJECT BUDGET
----------------------
TENFOLD CORPORATION 4/20/00
SITE 00.00 XXXXX
XXXXXX FEET BLDG 1 3 FLOORS @ 31,630 SQ FT 94,890
BLDG 2 5 FLOORS @ 21,022 SQ FT 105,110
----------
000,000
XXXXXXX XXXXXX FEET 84.30% 168,600
AVAILABLE SQUARE FEET 15.70% 31,400
PARKING 4 STALLS PER 1000 800
LAND 21.43 ACRES $ 4.56 / SQ FT $ 4,257,530
SHELL 200,000 SQ FT $ 65.00 / SQ FT $ 13,000,000
SITE $ 3,088,480
A & E FEES 6.0% $ 965,309
TENANT FINISH 200,000 SQ FT $ 20.00 / SQ FT $ 4,000,000
CONTINGENCY 3% $ 631,614
--------------
HARD COST SUB TOTAL $ 25,942,933
LEGAL, TITLE, PROPERTY TAXES, MISC $ 433,000
CITY IMPACT FEES $ 2.00 / SQ FT $ 400,000
LEASING COMMISSION $ 5.00 / SQ FT $ 1,000,000
CONSTRUCTION LOAN POINTS 0.5% $ 151,730
CONSTRUCTION INTEREST 8.5% 16 MONTHS $ 1,599,764
PERMANENT LOAN POINTS 1% $ 303,460
SET UP FEE 1% $ 303,460
CONSTRUCTION MGMT FEE $ 83,365
CONTINGENCY 3% $ 128,243
--------------
SOFT COST SUB TOTAL $ 4,403,021
--------------
TOTAL COST $ 30,345,954
LESS:
TENFOLD TENANT ESCROW ACCOUNT $ 15.00 X 168,600 $ (2,529,000)
SOUTH JORDAN WAIVER OF IMPACT FEES $ (400,000)
SOUTH JORDAN SPECIAL IMPROVEMENT DISTRICT $ (1,166,429)
UTAH POWER & LIGHT FINANSWER PROGRAM $ (250,000)
--------------
INITIAL PROJECT BUDGET $ 26,000,525
MULTIPLY BY PRO-RATA SHARE 84.30%
MULTIPLY BY RATE OF RETURN 13%
--------------
BASIC ANNUAL RENT $ 2,849,398
DIVIDE BY TENFOLD SQUARE FEET 168,600
--------------
TRIPLE NET LEASE RATE $ 16.90
==============
EXHIBIT "H"
CLEANING SPECIFICATIONS
SCHEDULE OF JANITORIAL SERVICES
-------------------------------
OFFICE AREAS:
------------
1. Empty, clean and damp dust all waste receptacles and remove waste
paper and rubbish from the Premises nightly; wash receptacles as
necessary.
2. Empty and clean all ash trays, screen all sand urns nightly and supply
and replace sand as necessary.
3. Vacuum all rugs and carpeted areas in offices, lobbies and corridors
nightly. Spot clean carpets as needed.
4. Hand dust and wipe clean with damp or treated cloth all office
furniture, files, fixtures, paneling, window xxxxx and other
horizontal surfaces nightly; wash window xxxxx when necessary.
5. Damp wipe and polish all glass furniture tops nightly.
6. Remove all finger marks and smudges from vertical surfaces, including
doors, door frames, around light switches, private entrance glass and
partitions nightly.
7. Wash clean all water coolers nightly.
8. Sweep all stairways nightly, vacuum if carpeted.
9. Police all stairwells throughout the entire building daily and keep in
clean condition.
10. Damp mop spillage in office and public areas as required.
11. Damp dust all telephones as necessary.
WASHROOMS:
---------
1. Mop, rinse and dry floors nightly.
2. Scrub floors weekly.
3. Clean all mirrors, bright work and enameled surfaces nightly.
H-1
4. Wash and disinfect all basis, urinals and bowls nightly, using non-
abrasive cleaners to remove stains and clean underside of rim on
urinals and bowls nightly.
5. Wash both sides of all toilet seats with soap and water and disinfect
nightly.
6. Damp wipe nightly, wash all partitions, tile walls and outside surface
of all dispensers and receptacles.
7. Empty and sanitize all receptacles and sanitary disposals nightly;
thoroughly clean and wash at least once per week.
8. Fill toilet tissue, soap, towel and sanitary napkin dispensers
nightly.
9. Clean flushometers, piping, toilet seat hinges and other metal work
nightly.
10. Wash and polish all wall, partitions, tile walls and enamel surfaces
from trim to floor monthly or as needed.
11. Vacuum all louvers, ventilating grills, and dust light fixtures
monthly.
FLOORS:
------
1. Ceramic tile, marble and terrazzo floors to be swept and buffed
nightly and washed or scrubbed as necessary.
2. Vinyl asbestos, asphalt, vinyl, rubber or other composition floors and
bases to be swept nightly; such floors in public areas on multiple
tenancy floors to be waxed and buffed as needed.
3. Tile floors in office areas will be washed and buffed monthly.
4. All vinyl floors stripped and rewaxed as necessary.
5. All carpeted areas and rugs to be vacuumed clean nightly.
6. Detail vacuuming shall be performed as necessary.
RAISED COMPUTER FLOORS:
----------------------
1. Dry mop and spot clean all computer flooring nightly.
2. West mop all computer flooring at least once weekly. Mopping may be
performed on separate sections of the computer flooring on successive
nights, as long as entire raised flooring is mopped once during each
one-week period.
H-2
3. Buff all computer flooring monthly.
4. Computer sub-flooring shall be cleaned annually by contractor, or as
necessary.
GLASS:
-----
1. Clean glass entrance doors, adjacent glass panels, and any common area
glass nightly.
HIGH DUSTING (as needed):
------------
1. Dust and wipe clean all closet shelving when empty and carpet sweep or
dry mop all floors in closets if such are empty.
2. Dust all picture frames, charts, graphs, and similar wall hangings.
3. Dust clean all verticals such as walls, partitions, doors, door bucks,
and other surfaces above shoulder height.
4. Damp dust all ceiling air conditions diffusers, wall grilles,
registers and other ventilating louvers.
5. Dust the exterior surfaces of lighting fixtures, including glass and
plastic enclosures.
6. Dust all mini blinds.
ELEVATORS:
---------
1. Carpets will be vacuumed daily and spot cleaned as necessary.
2. Exterior and interior doors and trim will be dusted nightly.
3. Cabinets will be dusted nightly.
4. Control and dispatch panels will be dusted and polished as necessary.
5. Elevator thresholds will be cleaned nightly.
6. Hardwood surfaces will be kept clean.
7. Telephones will be kept dust free.
H-3
GENERAL:
-------
1. Wipe all interior metal window frames, mullions, and other unpainted
interior metal surfaces of the perimeter walls of the building each
time the interior of the window is washed (as requested by the
Manager).
2. Keep slopsink rooms in a clean, neat and orderly condition at all
times.
3. Wipe clean and polish all metal hardware fixtures and other bright
work nightly.
4. Dust and/or wash all directory boards as required, remove fingerprints
and smudges nightly.
5. Maintain building lobby, corridors and other public areas in a clean
condition.
6. Dust fire extinguishers and cabinets nightly (interior and exterior);
wash as necessary.
7. All baseboards (resilient flooring and carpeted areas) will be washed
and wiped clean as necessary.
8. Vacuum entrance mats nightly.
9. Perform special cleaning needs of individual tenants only as
authorized and directed by the Manger.
10. Properly maintain exterior of building at ground level by ensuring
that curtain wall, glass, marble, etc., is kept in a clean condition.
Exterior stainless steel is to be cleaned or polished weekly.
11. Polish standpipes and sprinkler siamese connections as necessary.
12. Wash all interior windows semi-annually.
13. Police parking lot, paying particular attention to drains, corners,
curbs and general policing of grounds.
14. Janitors will change out florescent lights as necessary. Janitors
will order and receive shipments.
15. All cleaning equipment will be provided by janitorial contractor.
Paper products will be ordered and received by janitors. Landlord
will provide janitor with supply vendor.
H-4
LIABILITY INSURANCE
-------------------
1. Contractors shall at all times during this contract maintain in force
a policy of liability and property damage insurance of at least
$200,000, and shall name The Xxxxx Company as an additional insured in
said policy. Contractors shall provide evidence of such coverage to
The Xxxxx Company.
H-5
EXHIBIT "I"
BUILDING RULES AND REGULATIONS
The following rules and regulations shall apply, where applicable, to the
Premises, the Building, the parking garage (if any), the Property and the
appurtenances. Capitalized terms have the same meaning as defined in the Lease.
1. Sidewalks, doorways, vestibules, halls, stairways and other similar areas
shall not be obstructed by Tenant or used by Tenant for any purpose other
than ingress and egress to and from the Premises. No rubbish, litter,
trash, or material shall be placed, emptied, or thrown in those areas. At
no time shall Tenant permit Tenant's employees to loiter in Common Areas or
elsewhere about the Building or Property.
2. Plumbing fixtures and appliances shall be used only for the purposes for
which designed, and no sweepings, rubbish, rags or other unsuitable
material shall be thrown or placed in the fixtures or appliances. Damage
resulting to fixtures or appliances by Tenant, its agents, employees or
invitees, shall be paid for by Tenant, and Landlord shall not be
responsible for the damage.
3. No signs, advertisements or notices shall be painted or affixed to windows,
doors or other parts of the Building, except those of such color, size,
style and in such places as are first approved in writing by Landlord. All
tenant identification and suite numbers at the entrance to the Premises
shall be installed by Landlord, at Tenant's cost and expense, using the
standard graphics for the Building. Except in connection with the hanging
of lightweight pictures and wall decorations, no nails, hooks or screws
shall be inserted into any part of the Premises or Building except by the
Building maintenance personnel.
4. Landlord may provide and maintain in the first floor (main lobby) of the
Building an alphabetical directory board or other directory device listing
tenants, and no other directory shall be permitted unless previously
consented to by Landlord in writing.
5. Tenant shall not place any lock(s) on any door in the Premises or Building
without Landlord's prior written consent and Landlord shall have the right
to retain at all times and to use keys to all locks within and into the
Premises. A reasonable number of keys to the locks on the entry doors in
the Premises shall be furnished by Landlord to Tenant at Tenant's cost, and
Tenant shall not make any duplicate keys. All keys shall be returned to
Landlord at the expiration or early termination of this Lease.
6. All contractors, contractor's representatives and installation technicians
performing work in the Building shall be subject to Landlord's prior
approval and shall be required to comply with Landlord's standard rules,
regulations, policies and procedures, which may be revised from time to
time.
I-1
7. Movement in or out of the Building of furniture or office equipment, or
dispatch or receipt by Tenant of merchandise or materials requiring the use
of elevators, stairways, lobby areas or loading dock areas, shall be
restricted to hours designated by Landlord. Tenant shall obtain Landlord's
prior approval by providing a detailed listing of the activity. If
approved by Landlord, the activity shall be under the supervision of
Landlord and performed in the manner required by Landlord. Tenant shall
assume all risk for damage to articles moved and injury to any persons
resulting from the activity. If equipment, property, or personnel of
Landlord or of any other party is damaged or injured as a result of or in
connection with the activity, Tenant shall be solely liable for any
resulting damage or loss.
8. Landlord shall have the right to approve the weight, size, or location of
heavy equipment or articles in and about the Premises. Damage to the
Building by the installation, maintenance, operation, existence or removal
of Tenant's Property shall be repaired at Tenant's sole expense.
9. Corridor doors, when not in use, shall be kept closed. Nothing shall be
swept or thrown into the corridors, halls, elevator shafts or stairways.
No birds or animals (other than seeing-eye dogs) shall be brought into or
kept in, on or about any tenant's leased premises. No portion of any
tenant's leased premises shall at any time be used or occupied as sleeping
or lodging quarters.
10. Tenant shall not: (1) make or permit any improper, objectionable or
unpleasant noises or odors in the Building, or otherwise interfere in any
way with other tenants or persons having business with them; (2) solicit
business or distribute, or cause to be distributed, in any portion of the
Building, handbills, promotional materials or other advertising; or (3)
conduct or permit other activities in the Building that might, in
Landlord's sole opinion, constitute a nuisance.
11. Tenant shall cooperate with Landlord's employees in keeping its leased
premises neat and clean. Tenants shall not employ any person for the
purpose of such cleaning other than the Building's cleaning and maintenance
personnel.
12. No flammable, explosive or dangerous fluids or substances shall be used or
kept by Tenant in the Premises, Building or about the Property. Tenant
shall not, without Landlord's prior written consent, use, store, install,
spill, remove, release or dispose of, within or about the Premises or any
other portion of the Property, any asbestos-containing materials or any
solid, liquid or gaseous material now or subsequently considered toxic or
hazardous under the provisions of 42 U.S.C. Section 9601 et seq. or any
other applicable environmental Law which may now or later be in effect.
Tenant shall comply with all Laws pertaining to and governing the use of
these materials by Tenant, and shall remain solely liable for the costs of
abatement and removal.
13. Tenant shall not use or occupy the Premises in any manner or for any
purpose which might injure the reputation or impair the present or future
value of the Premises or the
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Building. Tenant shall not use, or permit any part of the Premises to be
used, for lodging, sleeping or for any illegal purpose.
14. Tenant shall not take any action which would violate Landlord's labor
contracts or which would cause a work stoppage, picketing, demonstration,
labor disruption or dispute, or interfere with Landlord's or any other
tenant's or occupant's business or with the rights and privileges of any
person lawfully in the Building ("Labor Disruption"). Tenant shall take
the actions necessary to resolve the Labor Disruption, and shall have
pickets removed and, at the request of Landlord, immediately terminate any
work in the Premises that gave rise to the Labor Disruption, until Landlord
gives its written consent for the work to resume. Tenant shall have no
claim for damages against Landlord or any of the Landlord Related Parties,
nor shall the Commencement Date of the Term be extended as a result of the
above actions.
15. Tenant shall not install, operate or maintain in the Premises or in any
other area of the Building, electrical equipment that would overload the
electrical system beyond its capacity for proper, efficient and safe
operation as determined solely by Landlord. Tenant shall not furnish
cooling or heating to the Premises, including, without limitation, the use
of electronic or gas heating devices, without Landlord's prior written
consent. Tenant shall not use more than its proportionate share of
telephone lines and other telecommunication facilities available to service
the Building.
16. Tenant shall not operate or permit to be operated a coin or token operated
vending machine or similar device (including, without limitation,
telephones, lockers, toilets, scales, amusement devices and machines for
sale of beverages, foods, candy, cigarettes and other goods), except for
machines for the exclusive use of Tenant's employees.
17. Bicycles and other vehicles are not permitted inside the Building or on the
walkways outside the Building, except in areas designated by Landlord.
18. Landlord may from time to time adopt systems and procedures for the
security and safety of the Building, its occupants, entry, use and
contents. Tenant, its agents, employees, contractors, guests and invitees
shall comply with Landlord's systems and procedures.
19. Landlord shall have the right to prohibit the use of the name of the
Building or any other publicity by Tenant that in Landlord's sole opinion
may impair the reputation of the Building or its desirability. Upon
written notice from Landlord, Tenant shall refrain from and discontinue
such publicity immediately.
20. Tenant shall not canvass, solicit or peddle in or about the Building or the
Property.
21. Neither Tenant nor its agents, employees, contractors, guests or invitees
shall smoke or permit smoking in the Common Areas, unless the Common Areas
have been declared a designated smoking area by Landlord, nor shall the
above parties allow smoke from the Premises to emanate into the Common
Areas or any other part of the Building. Landlord
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shall have the right to designate the Building (including the Premises) as
a non-smoking building.
22. Landlord shall have the right to designate and approve standard window
coverings for the Premises and to establish rules to assure that the
Building presents a uniform exterior appearance. Tenant shall ensure, to
the extent reasonably practicable, that window coverings are closed on
windows in the Premises while they are exposed to the direct rays of the
sun.
23. Deliveries to and from the Premises shall be made only at the times, in the
areas and through the entrances and exits designated by Landlord. Tenant
shall not make deliveries to or from the Premises in a manner that might
interfere with the use by any other tenant of its premises or of the Common
Areas, any pedestrian use, or any use which is inconsistent with good
business practice.
24. The work of cleaning personnel shall not be hindered by Tenant after 5:30
p.m., and cleaning work may be done at any time when the offices are
vacant. Windows, doors and fixtures may be cleaned at any time. Tenant
shall provide adequate waste and rubbish receptacles to prevent
unreasonable hardship to the cleaning service.
25. Landlord will not be responsible for lost or stolen personal property,
money or jewelry from tenant's leased premises or public or common areas
regardless of whether such loss occurs when the area is locked against
entry or not.
26. No tenant may enter into phone rooms, electrical rooms, mechanical rooms,
or other service areas of the Building unless accompanied by Landlord or
the Building manager.
27. All vehicles are to be currently licensed, in good operating condition,
parked for business purposes having to do with Tenant's business operated
in the Premises, parked within designated parking spaces, one vehicle to
each space. No vehicle shall be parked as a "billboard" vehicle in the
parking lot. Any vehicle parked improperly may be towed away. Tenant,
Tenant's agents, employees, vendors and customers who do not operate or
park their vehicles as required shall subject the vehicle to being towed at
the expense of the owner or driver. Landlord may place a "boot" on the
vehicle to immobilize it and may levy a charge of $50.00 to remove the
"boot." Tenant shall indemnify, hold and save harmless Landlord of any
liability arising from the towing or booting of any vehicles belonging to a
Tenant Party.
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