EXHIBIT 10.2
OFFICE LEASE
LEASE entered into by and between XXXXX BUILDING, INC., a New Mexico
Corporation ("Lessor"), whose address for any notice under this Lease is
XXXXX BUILDING, XXXXX 000, 000 XXXX XX, XXXXXXXXXXX, XXX XXXXXX 00000 and
Xxxx Xxxxx Corporation ("Lessee"), whose address for any notice required
under this Lease is XXXXX 000 , 000 XXXX XX, XXXXXXXXXXX, XXX XXXXXX 00000.
Lessor and Lessee agree that:
1. PREMISES: Lessor leases to Lessee that portion of office space referred to
as Suite 750 indicated on EXHIBIT "A" attached hereto and incorporated
herein (the "Premises") located in the XXXXX BUILDING situated at 400 Gold
SW, Albuquerque, New Mexico, (the `Building"). The Premises consists of
approximately 4,237 square feet of net rentable area (3,684 square feet of
usable area), including "Lessee's Proportionate Share" of the common areas
of the Building. Lessee may use the Premises only for a BUSINESS OFFICE, or
for such other purposes as are approved by Lessor in writing.
2. TERM OF LEASE: The term of this Lease will commence March 1, 2004, and
end February 28, 2007. Lessee shall have the option of extending this lease
for an additional 3 year period; with 90 days written notice, The rent
shall be market rate at the time, but all other terms and conditions shall
remain the same.
3. RENT: Lessee agrees to pay Lessor, as rental for the Premises, for the
Term, without prior notice or demand, the sum of $162,000 (the "Rent"),
plus consumer price index (CPI) adjustments. Rent for the first month in
the amount of 54,500 will be due and payable upon signing of the Lease.
Thereafter, each monthly installment will be due on the first (1st) day of
each month, in advance. throughout the Term. Lessee will pay a late charge,
each month, equal to ten percent (10%) of the amount of any monthly
installment which is not paid before the tenth (10th) day of the month.
Rent FOR any period during the initial Term which is for less than one (1)
month will be prorated. All rent will be paid to Lessor, without deduction
or offset, at the address of Lessor at XXXXX BUILDING, INC., 000 XXXX XX,
XXXXX 000, XXXXXXXXXXX, XXX XXXXXX 00000, or to such other person or at
such other place as Lessor may from time to time designate in writing.
4. RENT ADJUSTMENT: The rent is subject to annual adjustment by the published
consumer price index (CPI) for all urban consumers, on the anniversary date
of the lease. The base CPI will be the published index for the month of
January, 2004.
5. SECURITY DEPOSIT: Contemporaneously with the execution of this Lease,
Lessee will deposit with Lessor the sum of $4,500 as security for Lessee's
faithful performance of its obligations under this Lease (the "Security
Deposit"), Lessor may commingle the Security Deposit with other funds of
Lessor, and Lessor will have no obligation to pay interest on the Security
Deposit. Lessor may apply any portion of the Security Deposit to any Rent
or other amount under this Lease which is not paid when due or to any
damage suffered by Lessor as a result of any breach of Lessee, all without
prejudice to any other remedy of Lessor under this Lease, at law, or at
equity. If Lessor so applies any portion of the Security Deposit, Lessee
will immediately restore the Security Deposit to the full amount originally
deposited, with interest at twenty percent (20%) per year until paid.
Lessor will return any remaining Security Deposit to Lessee within fifteen
(15) days after the Term. Without limiting Lessor's rights hereunder to
cure defaults of Lessee, the Security Deposit will not be construed as
prepayment of Rent If Lessor transfers its interest in this Lease and the
Security Deposit the Lessor will thereupon be relieved of any further
liability with respect to the Security Deposit.
6. TAXES AND CHARGES: Lessor will pay, before delinquency, all property taxes
and assessments levied or assessed against the Premises by any governmental
authority. Lessor will pay all customary charges for water, electricity,
gas, sewer, janitorial service and supplies, power, rubbish removal and
other public utilities. Lessor may, at its expense, contest any such tax,
assessment or charges. If Lessor's actual cost of property taxes or
assessments or any single utility in any calendar year exceed the actual
cost of that item in the prior year by more than 20%, then Lessee will pay
its prorata share of such increase. Lessee will be responsible for any
extraordinary or additional taxes or charges pertaining to any personal
property placed by Lessee on Premises, including, but not limited to,
charges for telephone service.
7. FIRE INSURANCE: Lessor, at its expense, will during the Term maintain in
force an insurance policy insuring the Premises against loss or damage by
fire, theft and the perils covered by extended coverage, in such amounts as
Lessor deems appropriate. Lessee will be responsible for maintaining
insurance covering any additions, alterations, or improvements placed on
Premises or covering Lessee's personal property located on Premises.
8. LIABILITY INSURANCE: Lessee, at its expense, will during the Term maintain
in force an insurance policy naming Lessor and Lessee as insureds against
all liability resulting from injury to or death of any person or persons
and damage to property on the Premises. The policy will be in an amount not
less than $1,000,000.00 combined liability policy. Lessee will maintain in
force all employees' compensation insurance on its employees required under
the applicable Worker's Compensation Act.
9. MAINTENANCE OF PREMISES:
a) Lessor will, at its expense, keep the Premises in as good a condition
as existed at the start of the Term, except for reasonable wear and
tear or damage to the Premises caused by Lessee. Lessee will repair any
damage to any additions, alterations, or improvements placed on, the
Premises and any damage caused by Lessee. Lessor or Lessee, as
applicable, will make all repairs in compliance with applicable laws.
Lessee's taking possession of the Premises will be conclusive evidence
that, as of the date of possession, the Premises was in good order and
satisfactory condition. Lessor and its agents have made no promise to
alter, remodel, repair, or improve the Premises or the Building, other
than as expressly contained herein or in a separate agreement signed by
the Lessor.
b) Lessee will not make any additions, alterations, or improvements to the
Premises without the prior written consent of Lessor, which will not be
unreasonably withheld. Lessor's consent may be conditioned upon such
requirements as Lessor may deem necessary. Unless their removal is .
required by Lessor prior to or upon the expiration of the Term, any
additions, alterations or improvements made to the Premises will become
the property of the Lessor upon the expiration of the Term.
c) Lessor will provide heating/cooling five (5) days a week, Monday
through Friday from seven o'clock (7:00 A.M.) in morning till six
o'clock (6:00 P.M.) in the evening. Lessor may arrange to provide
heating/cooling during other hours at an hourly rate to be agreed to
prior to such provision.
10. INDEMNIFICATION: Lessor will not be liable for any injury or damage to any
person or property arising from any cause on the Premises, except for
injury or damage resulting from Lessor's intentional misconduct. Lessee
will indemnify and defend Lessor against any loss, liability or expense
arising out of any damage to any person or property occurring on the
Premises, except to the extent caused by Lessor's intentional misconduct.
11. DESTRUCTION OR DAMAGE:
a) If the Premises or the portion of the Building necessary for Lessee's
occupancy is damaged by fire, earthquake, act of God, the elements or
other casualty, other than damage caused by Lessee, Lessor will
promptly repair the damages, if such repairs can, in Lessor's opinion,
be completed within ninety (90) days. If Lessor determines that repairs
can be completed within ninety (90) days, this Lease will remain in
full force and effect, except that the Rent will be abated to the
extent Lessee's use of the Premises is impaired, commencing with the
date of damage and continuing until completion of the repairs.
b) If, in Lessor's opinion, the repairs to the Premises or portion of the
Building necessary for Lessee's occupancy cannot be completed within
ninety (90) days, Lessor may elect, upon notice to
Lessee given within, thirty (30) days after the date of the fire or
other casualty, to terminate this Lease as of the date of such fire or
other casualty and the Rent will be prorated to the date of
termination. If Lessor does not so elect to terminate this Lease,
Lessor will repair the damage and this Lease will continue in fall
force and effect but the Rent will be partially abated as provided in
subparagraph 11 (a).
c) If any portion of the Building other than the Premises is totally
destroyed or damaged to the extent that, in Lessor's opinion, repair
thereof cannot be completed within ninety (90) days, Lessor may elect,
upon notice to Lessee given within thirty (30) days after the date of
such fire or other casualty, to terminate this Lease as of the date of
such fire or other casualty and the Rent will be prorated to the date
of termination. Lessor will not be liable for any loss of business,
inconvenience or allowance arising from any repair or restoration of
any portion of the Premises or Building as a result 'of any damage
d) Notwithstanding anything to the contrary contained herein, in the event
the holder of any indebtedness, secured by a mortgage or deed of trust
covering the Premises or Building, requires, after any damage from fire
or other casualty, that any insurance proceeds with respect thereto be
applied to such indebtedness, then Lessor will have the right to
terminate this Lease by delivering written notice of termination to
Lessee.
12. EMINENT DOMAIN:
a) If the whole of the Building is lawfully taken by condemnation or in
any other manner for any public or quasi-public purpose, this Lease
will terminate as of the date of such taking and the Rent will be
prorated to the date of termination. If less than the whole of the
Building is so taken, this Lease will be unaffected by such taking,
provided that (i) Lessee will have the right to terminate this Lease by
notice to Lessor given within thirty (30) days after the date of such
taking if twenty percent (20%) or more of the Premises is taken and the
remaining area of the Premises is not reasonably sufficient for Lessee
to continue operation of its business and (ii) Lessor will have the
right to terminate this Lease by notice to Lessee, given within ninety
(90) days after the date of such taking, if the remaining area of the
building is not reasonably sufficient for the Lessor to continue
operation of the Building. If either Lessor or Lessee elects to
terminate this Lease, the Lease will terminate as of the date of the
taking and the Rent will be prorated to the date of termination. If
this Lease continues in force upon such partial taking, the Rent will
be equitably adjusted.
b) In the event of any taking, partial or whole, all of the proceeds of
any award, judgment or settlement, payable by the condemning authority,
will be exclusive property of Lessor and Lessee
hereby assigns to Lessor all of its right, title and interest in any
award, judgment or settlement from the condemning authority. Lessee,
however, will have the right, to the extent that Lessor's award is not
reduced or prejudiced, to claim from the condemning authority (but not
from Lessor) such compensation as may be recoverable by Lessee in its
own right for relocation expenses and damage to Lessee's personal
property.
13. ASSIGNMENT AND SUBLETTING: Lessee may not sublease any of the Premises or
assign this Lease, without the written consent of Lessor, which will not be
unreasonably withheld. If the Lessee is an entity other than a natural
person, any transfer of any ownership interest in the Lease will constitute
a prohibited assignment. A sublease, or assignment of this Lease, will not
relieve Lessee from any of its obligations pursuant to this Lease whether
or not Lessor consents to the sublease or assignment. Lessor may transfer
its interest under this Lease without Lessee's consent and, in the event of
such transfer, Lessor will not be liable to Lessee for any facts or
circumstances occurring after such transfer.
14. LESSOR'S ACCESS TO PREMISES: Lessor will have free access to the Premises
at all reasonable times for the purpose of examining the Premises, to
exhibit the Premises to Lessor's prospective purchasers or mortgagees of
the Premises, to determine if Lessee is performing this Lease and to post
such reasonable notices as Lessor may desire to protect the rights of
Lessor.
15. DEFAULT: If Lessee fails to perform the duties of Lessee under this Lease
when the duties are to be performed, the Lessee will be in default under
this Lease. If the default is not cured within ten. (10) days after written
notice of the default is given to Lessee, then Lessor may, at its election,
(i) declare the Term ended, enter and retake the premises with or without
process, expel any occupants, and recover from Lessee the amount of unpaid
Rent up to the date of termination or (ii) without ending the Term, take
possession of the Premises, expel any occupants, attempt to re-lease, or
re-. lease the Premises, and recover from Lessee the amount of unpaid Rent
for the Term. The failure of Lessor to exercise any remedy of this Lease
for any uncured default will not be a waiver of any right to exercise any
remedy on this Lease for any prior or subsequent uncured default. All of
Lessor's remedies will be cumulative.
16. COSTS:
a) If Lessee fails to perform any of its duties under this Lease, Lessor
may do so on Lessee's behalf. Lessee will pay the costs, including
attorneys' fees, of Lessor incurred in enforcing this Lease or in
performing any of Lessee's duties under this Lease.
b) Any amounts expended by Lessor in performing Lessee's duties or
enforcing this Lease will bear interest at twenty percent (20%) per
year and will be payable by Lessee to Lessor on demand.
Any monthly installment of Rent not paid when due will bear interest at
twenty percent (20%) per year from the first day of the month during
which such monthly installment is due until paid.
17. HOLD-OVER: If Lessee holds over after the end of the Term, the holding-over
will be considered a forcible entry and detainer by Lessee with rental
payable for the period of such holding-over as though a tenancy from month
to month had been created in the amount to one hundred fifty percent (150%)
of the monthly rental payable just preceding the period of holding-over.
Holding-over will be subject to all the terms of this Lease but will not be
construed as a renewal of this Lease.
18. RETURN OF PREMISES:
a) Lessee will return the Premises to Lessor at the end of the Term in as
good a condition as when the Term began, loss by ordinary wear
excepted.
b) Lessee will remove from the Premises all shelving, movable furniture,
trade fixtures, and any additions, alterations, or improvements made by
Lessee, whose removal is required by Lessor, and Lessee will repair any
damage caused by the removal.
19. PARKING : Lessee will have the right to 8 parking spaces, located in the
parking structure of the Building, for which Lessee will pay the monthly
rate being charged for comparable spaces depending upon location. Lessee
will be required, prior to using the space, to sign a Parking Agreement
included as EXHIBIT "B" attached hereto. Lessor may, from time to time,
change the terms and conditions of the Parking Agreement.
20. SUBORDINATION AND ATTORNMENT:
a) Upon written request of Lessor, any mortgagee or deed of trust
beneficiary of Lessor or ground lease of Lessor, Lessee will, in
writing, subordinate its rights under this Lease to the lien of any
mortgage or deed of trust or to the interest of any lease in which,
Lessor is Lessee and to all advances made or hereafter to be made
thereunder. However, before signing any subordination, Lessee will have
the right to obtain, from any lender or lessor of Lessor requesting
such subordination, an agreement in writing providing that, as long as
Lessee is not in default hereunder, this Lease will remain in effect
for the full Tenn.
b) In the event of any foreclosure, sale or transfer in lieu of
foreclosure, Lessee will attorney to the purchaser, transferee or
lesser, as the case may be, and recognize that party as lesser under
this Lease, provided such party acquires and accepts the Premises
subject to this Lease.
21. TENANT ESTOPPEL CERTIFICATES: Within ten (10) days after written request
from Lessor, Lessee will execute and deliver to Lessor or Lessor's designee
a written statement certifying; (a) that this Lease is unmodified and in
full force and effect or is in full force and effect as modified and
stating the modifications; (b) the amount of the Rent and the date to which
Rent has been paid in advance; (c) the amount of any security deposited
with Lessor and (d) that Lessor is not in default hereunder or, if Lessor
is claimed to be in default, stating the nature of any claimed default. Any
such statement may be relied upon by a purchaser, assignee or lender.
Lessee's failure to execute and deliver such statement within the time
required will be conclusive upon Lessee that: (1) this Lease is in full
force and effect and has not been modified except as represented by Lessor;
(2) there are no uncured defaults in Lessor's performance and that Lessee
has no right to offset, counterclaim or deduction against Rent and (3) not
more than one month's Rent has been paid in advance.
22. RULES AND REGULATIONS: Lessee agrees to comply with all rules and
regulations promulgated by Lessor with respect to the Building as stated
but not limited to EXHIBIT "C", which may be revised from time to time..
Lessee may not post or erect any sign on the exterior portion of the
Premises or elsewhere in or on the Building without the prior written
consent of Lessor.
23. SECURITY INTEREST: In addition to any statutory or common law landlord's
lien or right to distress, Lessee hereby grants to Lessor a security
interest in any personal property of Lessee now or hereafter located on the
Premises to secure all of Lessee's obligations under this Lease. Upon any
default of Lessee under, this Lease, Lessor will have all rights of a
secured party under the New Mexico Uniform Commercial Code. Ten (10) days
notice of any sale or other disposition of the collateral referred to
herein will constitute reasonable notice.
24. QUIET ENJOYMENT: Lessor represents that, upon Lessee's paying the Rent and
performing its covenants under this Lease, Lessee may peaceably and quietly
have, hold, and enjoy the Premises subject to the terms of this Lease.
Lessor has the option to relocate the Premises anywhere in the Building to
comparable space, at the expense of Lessor, by giving Lessee ninety (90)
days written notice. Lessee may approve the new location and continue this
Lease in force or, at its option, terminate this Lease.
25. BROKERS: Lessor and Lessee agree that Xxxxxx Xxxxxxxxx of Xxxxxxxxx
Properties, Inc. is involved in the origination, negotiation and execution
of this Lease and each party warrants and represents to the other that no
other agent, finder or salesman has been involved in the origination,
negotiation or execution of this Lease. Lessor will pay all fees,
commissions or similar payments due to the Broker as a result of the
execution of this Lease. Lessor and Lessee will each defend, indemnify and
hold the other party harmless from and against any and all loss, cost or
expense (including attorneys fees and expenses) resulting from any claim
for any fee, commission or similar payment by any broker, agent, finder or
salesman as a result of any action of Lessor or Lessee, as applicable,
related to the origination, negotiation or execution of this Lease.
26. TENANT IMPROVEMENTS: Lessor and Lessee agree that any tenant improvements
will be constructed by Lessor in accordance with the terms set out on
EXHIBIT "D", attached hereto and incorporated herein, which must be
executed by both Lessor and Lessee to be effective. Lessee hereby agrees to
pay $ 0 toward tenant improvement, prior to Lessor starting the tenant
improvements.
27. BINDING EFFECT AND GOVERNING LAW: This Lease will benefit and bind the
parties, their successors, transferees, personal representatives,
sublessees and heirs; will be governed by the laws of New Mexico;
constitutes the entire agreement of the parties and may be modified only in
writing signed by Lessor and Lessee. If any provision of this Lease is
determined to be void or unenforceable, the remainder of the Lease will
nevertheless continue in full force and effect. Time is of the essence in
this Lease.
28. Notices: Whenever, under this Lease, a provision is made for notice of any
kind, it shall be deemed sufficient notice and service thereof if such
notice to Lessee is in writing addressed to Lessee at:
Xxxx Xxxxx Corporation
Xxxxx 000
000 Xxxx XX
Xxxxxxxxxxx, XX 00000
(or at such other address as may be designated by Lessee from time to time)
sent by registered or certified mail with postage prepaid. It shall be
deemed sufficient notice and service thereof if such notice to Lessor is in
writing addressed to Lessor at:
Xxxxx Building, Inc.
Xxxxx 000
000 Xxxx XX
Xxxxxxxxxxx, XX 00000
(or such other address as may be designated by Lessor from time to time)
sent by registered or certified mail with postage prepaid. Notice need be
sent to only one tenant where tenant is more than one person.
29. GUARANTEE: Each Lessee, and guarantor, agrees, jointly and severally, to
guarantee full performance of Lessee's obligation under this Lease,
including, but not limited to, payments of rent and damages.
30. ENTIRE AGREEMENT: This Lease constitutes the entire agreement between
Lessor and Lessee and supersedes and replaces any and all prior and
contemporaneous written and oral agreements, promises, representations or
conditions.
