LEASE AGREEMENT
between
DOVE VALLEY BUSINESS CENTER, LLLP,
as Landlord
and
KOALA CORPORATION,
as Tenant
March 16, 2000
TABLE OF CONTENTS
(continued)
TABLE OF CONTENTS
Page
1. PREMISES, TERM, RENEWAL OPTIONS AND CONSTRUCTION...............1
2. RENT AND SECURITY DEPOSIT......................................3
3. USE AND COMPLIANCE.............................................4
4. TAXES AND OTHER ASSESSMENTS....................................4
5. REPAIRS AND MAINTENANCE........................................4
6. ALTERATIONS....................................................5
7. SIGNS..........................................................5
8. INSPECTION.....................................................5
9. UTILITIES......................................................5
10. ASSIGNMENT AND SUBLETTING......................................5
11. INSURANCE: FIRE AND CASUALTY DAMAGE...........................6
12. LIABILITY......................................................7
13. CONDEMNATION...................................................7
14. HOLDING OVER...................................................8
15. QUIET ENJOYMENT................................................8
16. EVENTS OF DEFAULT..............................................8
17. REMEDIES.......................................................9
18. MORTGAGES.....................................................10
19. LANDLORD'S DEFAULT............................................11
20. ASSIGNMENT BY LANDLORD........................................11
21. FORCE MAJEURE.................................................11
22. MECHANIC'S LIENS..............................................11
23. NOTICES.......................................................11
24. MISCELLANEOUS.................................................12
25. HAZARDOUS MATERIALS...........................................13
26. BROKERAGE.....................................................14
27. SECURITY......................................................14
28. WARRANTIES....................................................14
29. SATELLITE DISH................................................14
30. CONFIDENTIALITY...............................................14
31. EXPANSION OPTION..............................................15
32. PURCHASE AND LEASE OF SOUTHERN LAND...........................16
EXHIBIT "A" Legal Description of the Land.............................A-1
EXHIBIT "B" Preliminary Plans.........................................B-1
LEASE AGREEMENT
STATE OF COLORADO, COUNTY OF ARAPAHOE
THIS LEASE AGREEMENT, made and entered into by and between DOVE VALLEY BUSINESS
CENTER, LLLP, a Colorado limited liability limited partnership, hereinafter
referred to as "Landlord", and KOALA CORPORATION, a Colorado corporation,
hereinafter referred to as "Tenant";
WITNESSETH:
1. PREMISES, TERM, RENEWAL OPTIONS AND CONSTRUCTION.
------------------------------------------------
(a) In consideration of the obligation of Tenant to pay rent as herein provided,
and in consideration of the other terms, provisions and covenants hereof, and in
accordance with such terms, provisions and covenants, Landlord agrees to
construct an industrial office manufacturing/warehouse building (the
"Building"), consisting of approximately one hundred and twenty-nine thousand
square feet (129,000) square feet, on the land consisting of approximately 6.936
acres located in the Dove Valley Business Park in Arapahoe County, Colorado, and
more particularly described on Exhibit "A" attached hereto and incorporated
herein by reference (the "Land," the Building and the Land, together with all
rights, privileges, easements, appurtenances and immunities belonging to or in
any way pertaining thereto and together with any other improvements situated or
to be situated upon said Land are hereinafter collectively referred to herein as
the "Premises"), and Landlord hereby leases to Tenant, and Tenant hereby leases
from Landlord, the Premises for the term described below and upon all of the
terms, provisions and conditions set forth herein.
The Premises shall be improved and include the features generally
described in the plans identified in, and the specifications set forth on,
Exhibit "B" attached hereto and incorporated herein by reference (the
"Preliminary Plans").
TO HAVE AND TO HOLD the same for a term commencing on the "Commencement
Date", as hereinafter defined, and ending one hundred and twenty (120) months
thereafter, provided, however, that in the event the Commencement Date is a date
other than the first day of a calendar month, said term shall extend for said
number of months in addition to the remainder of the calendar month following
the Commencement Date (and rent will be payable for such partial month in which
the Commencement Date occurs at the same rate per month, prorated on a per diem
basis, as will be payable for the first full month of the term as set forth in
Paragraph 2(a) below). Tenant will have two options to extend the term of this
Lease for five (5) years each, first at the end of one hundred and twenty (120)
months and, if Tenant elects to extend the term of this Lease for the first such
five-year renewal period, then again at the end of one hundred and eighty (180)
months, provided that if Tenant desires to so extend the term of this Lease at
either such time, Tenant will notify Landlord in writing of Tenant's election to
do so at least twelve (12) months prior to the expiration of the then-current
termination date. Either of such five-year renewal periods with respect to which
Tenant exercises its renewal option hereunder will be deemed a part of the
"term" of this Lease for all purposes hereunder.
(b) Based upon the Preliminary Plans, Landlord shall prepare and submit
architectural and engineering plans sufficient for permitting and construction
of the Building and other improvements to the Premises ("Final Plans") to Tenant
for approval as soon as practical. Tenant shall have ten (10) days from its
receipt of Final Plans to approve or, in good faith, disapprove of same. Any
disapproval must be limited to a failure of the Final Plans to conform with the
Preliminary Plans in any material respect, and must specify in reasonable detail
the reasons for the disapproval. If Tenant fails to approve or disapprove of the
Final Plans, as applicable, in writing within said ten (10) day period, Tenant
will be deemed to have approved such plans in all respects. Landlord and Tenant
agree to work together in good faith to finalize the Final Plans. In the event
of any dispute over whether the Final Plans conform in all material respects
with the Preliminary Plans, the parties shall submit such dispute to an
architect, the identity of whom shall be jointly agreed by the parties. Said
architect shall determine whether or not the Final Plans conform in all material
respects with the Preliminary Plans. The Building and all of the other
improvements to be constructed on the Land are hereinafter collectively referred
to as the "Improvements".
Landlord agrees to construct the Improvements at its sole cost and
expense, provided that Tenant will be responsible for the additional cost, if
any, resulting from any changes to the Final Plans requested by Tenant, as
evidenced by written change order or work order approved by Tenant (unless the
change was necessary to make the Final Plans conform to the Preliminary Plans or
unless necessitated by the error of Landlord or its architect). Within thirty
(30) days after the Commencement Date (as defined below), Landlord will submit
to Tenant a detailed statement, certified as true and complete by an officer of
Landlord, setting forth a Landlord's total cost of designing and constructing
the Improvements and acquiring the Land.
Initials: __________ __________
Landlord Tenant
2
Landlord shall be responsible for the procurement, payment for and
delivery of all materials required, necessary or appropriate for construction of
the Improvements, and Landlord shall cause the Improvements to be constructed in
a good and workmanlike manner, in accordance with the Final Plans and free and
clear of any mechanics' liens or claims therefor.
(c) Landlord and Tenant acknowledge that in order for Landlord to complete its
acquisition of the Land and construction of the Improvements, Landlord must
obtain the approval of the required officials of Arapahoe County, Colorado of
(i) a subdivision plat creating the Land and the "Expansion Area" (as defined in
Paragraph 31(b) below) as two lawfully subdivided lots (the "Plat"); and (ii) a
site improvement plan or other appropriate zoning document causing the Land to
be properly zoned for the construction and use of the Improvements as
contemplated by this Lease (the "Zoning"). Landlord will notify Tenant promptly
upon obtaining the Plat and promptly upon obtaining the Zoning. In the event
Landlord has not obtained the Plat and the Zoning by December 31, 2000 (and
notwithstanding any delays caused by force majeure as described in Paragraph
21), Tenant will have the right to terminate this Lease by notice to Landlord
given at any time thereafter until Landlord has notified Tenant that Landlord
has obtained both the Plat and the Zoning, at which time Tenant will have no
further right to terminate this Lease pursuant to this sentence. If Tenant
terminates this Lease pursuant to the preceding sentence, then Landlord will
refund to Tenant the first month's rent paid pursuant to Paragraph 2(a) and the
deposit paid pursuant to Paragraph 2(b) and any other amounts then paid by
Tenant under this Lease and both parties will be relieved of any further
obligations hereunder. If the Plat and the Zoning have not been obtained by
December 31, 2000 and Tenant does not terminate this Lease in accordance with
this Paragraph 1(c), then (A) the "Projected Commencement Date" (as defined in
Paragraph 1(e) below) will be automatically extended from August 1, 2001 by the
number of days from and after December 31, 2000 to the day on which the Plat is
recorded; and (B) the two additional deadlines set forth in Paragraph 1(e) below
(i.e., August 31, 2001 and January 31, 2002) will also be automatically extended
by the same number of days. Notwithstanding any other provisions hereof, if the
Zoning and the Plat have not been obtained by June 1, 2001, then this Lease will
terminate, Landlord will refund to Tenant the first month's rent paid pursuant
to Paragraph 2(a) and the deposit paid pursuant to Paragraph 2(b) and any other
amounts then paid by Tenant under this Lease and both parties will be relieved
of any further obligations hereunder. Upon recording of the Plat, the legal
descriptions set forth in this Lease for the Land and the Expansion Area will be
deemed replaced with the legal descriptions for the Land and the Expansion Area
made by reference to their respective lot numbers on the recorded Plat and
either party will, upon the other's request, execute a memorandum and amendment
to this Lease in recordable form giving notice hereof and setting forth such
substituted legal descriptions.
(d) As used herein the terms "Substantially Completed," "Substantially
Complete," or "Substantial Completion" means that:
1. Landlord's architect has certified that the construction of
the Improvements has been completed in substantial
accordance with the Final Plans, subject only to completion
of the Punchlist (hereafter defined).
2. The Premises, including all Improvements necessary for
Tenant's occupancy (e.g., HVAC systems, lobbies, stairways,
parking areas), are in good and operational condition.
3. A certificate of occupancy or temporary approval for
occupancy has been issued.
4. The Building is broom-clean and free from debris,
No less than thirty (30) days prior to the date Landlord estimates that
the Improvements will be Substantially Complete, Landlord will notify Tenant of
the estimated date the Improvements will be Substantially Completed, and
schedule with the Tenant a walk-through inspection of the Premises. Upon the
occurrence of Substantial Completion, representatives of Landlord and Tenant
shall conduct a walk-through inspection of the Premises to mutually determine
what items of construction require completion or repair (the "Punchlist") to be
completed or repaired by Landlord within thirty (30) days after the date of
Substantial Completion. At the conclusion of the walk-through inspection, Tenant
will be deemed to have acknowledged that subject to completion of the Punchlist
that Tenant has inspected and accepts the Premises, and Tenant agrees to execute
an Acceptance of Premises Memorandum, whereupon possession of the Premises will
be delivered to Tenant. Upon Tenant's acceptance of the Premises, and to the
extent assignable, Landlord will assign to Tenant the right to enforce all
warranties Landlord receives in connection therewith on a non-exclusive basis
(i.e. Landlord will also have the right to enforce such warranties).
The "Commencement Date" shall be the date upon which the Improvements
have been Substantially Completed as defined above, in accordance with the Final
Plans, or the date on which the Improvements would have been Substantially
Completed but for any Tenant Delays. As used herein, "Tenant Delays" shall mean
any delay in the completion of the Improvements to the Premises caused by
Tenant, its agents, employees, officers or contractors, provided however, that
(i) any delays caused by changes requested by Tenant necessary to make the Final
Plans conform to the Preliminary Plans or necessitated by the error of Landlord
or its architect or contractor will not constitute Tenant Delays; and (ii) in
order to claim any
Initials: __________ __________
Landlord Tenant
3
act or occurrence as a Tenant Delay, Landlord must notify Tenant thereof within
ten (10) days after such act or occurrence and any period of delay attributable
to an act or occurrence of which Landlord so notified Tenant but which occurred
before such ten (10) day notice period will not constitute a Tenant Delay. The
Acceptance of Premises Memorandum described above will also confirm the date on
which the Commencement Date occurs.
(e) The "Projected Commencement Date" shall mean August 1, 2001. The term of
this Lease and Tenant's obligation to pay rent hereunder will not commence until
the Commencement Date. If Landlord fails to Substantially Complete the
Improvements by thirty (30) days after the Projected Commencement Date (i.e., if
the Commencement Date does not occur by August 31, 2001), then (i) Landlord will
pay to Tenant delay damages in an amount equal to $946.30 per day for each day
of the period after August 31, 2001 to the actual Commencement Date, less any
portion of that period attributable to Tenant Delays or a force majeure event as
described in Paragraph 21 (which delay damages will be payable in monthly
installments due on the thirtieth (30th) of each month until the Commencement
Date, with any damages outstanding on the Commencement Date due on such date);
and (ii) if Landlord does not tender possession of the Premises to Tenant with
the Improvements Substantially Completed on or before January 31, 2002, plus any
period of delay caused by Tenant Delays but without extension for any delays
caused by any other force majeure event as described in Paragraph 21 (the
"Tender Deadline"), Tenant will have the right to terminate this Lease by
delivering written notice of termination to Landlord not more than thirty (30)
days after the Tender Deadline. Upon a termination under clause (ii) above,
Landlord will pay to Tenant an amount equal to any outstanding delay damages due
pursuant to clause (i) above; each party will, upon the other's request, execute
and deliver an agreement in recordable form containing a release and surrender
of all right, title and interest in and to this Lease; all Improvements to the
Premises will become and remain the property of Landlord; Landlord will refund
to Tenant any sums paid to Landlord by Tenant in connection with this Lease
(such as the deposit and first month's rent); and the parties will be relieved
of any further obligations hereunder. If Landlord delivers possession of the
Premises with the Improvements Substantially Completed prior to the Projected
Commencement Date, then Tenant will accept such delivery (and the date of such
delivery will be the Commencement Date hereunder), but Tenant's rent for the
period from the Commencement Date to the Projected Commencement Date will be
reduced as provided in Paragraph 2(a). Tenant's remedies set forth above for
Landlord's delay in tendering the Premises to Tenant with the Improvements
Substantially Completed are in lieu of any other remedies which might otherwise
be available to Tenant at law or in equity.
2. RENT AND SECURITY DEPOSIT.
-------------------------
(a) As part of the consideration for the execution of this Lease, and for the
Lease and use of the Premises, Tenant covenants and agrees and promises to pay
as rental to Landlord, or Landlord's assignees, the following monthly amounts:
First Renewal Term Second Renewal Term
Months: 1-30 31-60 00-00 00-000 000-000 000-000 000-000 000-000
------ ---- ----- ----- ------ ------- ------- ------- -------
Rent: $50,111 $52,491 $54,984 $57,596 $60,332 $63,198 $66,200 $69,345
One such monthly installment of fifty thousand one hundred eleven
dollars ($50,111.00), constituting rent for the first full calendar month of the
term, shall be due and payable on the date hereof and subsequent monthly
installments for an amount as indicated in above in this Paragraph 2(a), shall
be due and payable in advance, without demand, deduction or set off (except as
expressly provided to the contrary in this Lease), on or before the first day of
each calendar month succeeding the Commencement Date, except that if the
Commencement Date occurs on other than the first day of a month, payment due for
the month in which the Commencement Date occurs will be prorated and such
prorated amount will be due on the Commencement Date.
Notwithstanding the foregoing, in the event the Commencement Date
occurs prior to the Projected Commencement Date, then the rent payable pursuant
to this Paragraph 2(a) for each month or portion thereof during the period from
the Commencement Date until the Projected Commencement Date will be reduced by
the amount that Tenant is obligated to pay, for such month or portion thereof,
for the lease of its three existing premises located at 00000 Xxxx 00xx Xxxxxx,
Xxxxxx, Xxxxxxxx 00000, 0000 Xxxxxx, Xxxxxx, Xxxxxxxx 00000 and 0000 Xxxxxx
Xxxxxx, Xxxxxxxx Xxxx, Xxxxxxxx 00000; provided, however, that the total amount
of such offset does not exceed $14,194.50 per month.
(b) In addition, Tenant agrees to deposit with Landlord the sum of Fifty
thousand one hundred eleven dollars ($50,111.00), which shall be held by
Landlord, without obligation for interest, as security for the performance of
Tenant's covenants and obligations under this Lease, it being expressly
understood and agreed that such deposit is not an advance rental deposit or a
measure of Landlord's damages in case of Tenant's default. Upon each occurrence
of an "Event of Default" (as defined in Paragraph 16) by Tenant, Landlord may,
from time to time, without prejudice to any other remedy provided herein or
provided by law, use such fund to the extent necessary to make good any arrears
of rent or other payments due Landlord hereunder, and any other damage, injury,
expense or liability caused by such Event of Default. On demand, Tenant shall
pay to Landlord the amount that will restore the security deposit to its
original amount. Any remaining balance of such deposit shall be returned by
Landlord to Tenant within thirty (30) days after termination of this Lease.
Initials: __________ __________
Landlord Tenant
4
(c) In addition to the rent described above, Tenant agrees to directly pay for
all of the following to the extent the same accrue during the term of this
Lease: (i) Taxes (hereinafter defined) pursuant to Paragraph 4(a) below, (ii)
the cost of insurance required to be maintained by Tenant pursuant to Paragraph
11(a) below, (iii) the cost of all repairs and maintenance required to be
performed by Tenant pursuant to Paragraphs 5(a) and (b) below, and (iv) the cost
of all utilities consumed at the Premises pursuant to Paragraph 9 below.
3. USE AND COMPLIANCE.
------------------
(a) The Premises may be used for any lawful use including, without limitation,
the following intended uses by Tenant ("Tenant's Intended Use") (i) general
office use; (ii) light manufacturing, including, without limitation, the
molding, painting, and assembly of plastic products; and (iii) warehouse use.
Tenant shall, at its own cost and expense, obtain any and all licenses and
permits necessary for such use. Landlord warrants that Tenant's Intended Use is
permitted under the zoning laws and any private restrictive covenants applicable
to the Premises.
(b) Tenant at its expense shall at all times comply with all governmental laws,
codes, ordinances and regulations, including, without limitation, the Americans
with Disabilities Act, 42 U.S.C. 12101 et seq., applicable to Tenant's use and
occupancy of Premises and shall keep those portions of the Premises which Tenant
is obligated to maintain and repair pursuant to Paragraphs 5(a) and (b) in a
condition that complies with all applicable laws, codes, ordinance and
regulations, including, without limitation, the Americans with Disabilities Act,
42 U.S.C. 12101 et seq. Tenant shall be responsible, at Tenant's sole expense,
for the correction, prevention and abatement of nuisances in or upon the
Premises. Tenant will not permit the Premises to be used for any purpose which
would render the property or liability insurance thereon void.
(c) Landlord at its expense shall keep those portions of the Premises which
Landlord is obligated to maintain and repair pursuant to Paragraph 5(c) in a
condition that complies with all applicable governmental laws, codes, ordinances
and regulations, including, without limitation, the Americans with Xxxxxxxxxxxx
Xxx, 00 X.X.X. 00000 et seq.
4. TAXES AND OTHER ASSESSMENTS.
---------------------------
(a) Tenant agrees to pay all taxes, assessments or governmental charges of any
kind and nature whatsoever levied or assessed against the Premises, the Land or
Improvements (hereinafter collectively referred to as "Taxes") during the term
of this Lease. Taxes for the years in which the lease term commences and end
shall be prorated between Landlord and Tenant. Tenant may contest the amount of
Taxes levied against the Property at its own expense. Landlord shall not finance
the Improvements through a tax increment or similar scheme pursuant to which
Tenant will be required to pay for such Improvements through the payment of
additional taxes, and taxes resulting from such a scheme will not be included in
Taxes.
(b) If at any time during the term of this Lease, there shall be levied,
assessed or imposed on Landlord a capital levy or other tax directly on the
rents received from the Premises, the Land or Improvements and/or a franchise
tax, assessment, levy or charge measured by or based, in whole or in part, upon
such rents, then all such taxes, assessments, levies or charges, or the part
thereof so measured or based, shall be deemed to be included within the term
"Taxes" for the purposes hereof, provided that (i) in such event, for purposes
of determining the amount of Taxes for which Tenant is responsible, the
Premises, Land and Improvements shall be deemed to be Landlord's only property;
and (ii) in no event will Taxes include the income taxes of Landlord.
(c) Tenant shall be liable for all taxes levied or assessed against any personal
property or fixtures placed in the Premises.
5. REPAIRS AND MAINTENANCE.
-----------------------
(a) Subject to Paragraphs 11, 13 and 28, and except with respect to those
portions of the Premises which Landlord is obligated to maintain, repair and
replace pursuant to Paragraph 5(c) below, Tenant, at its own cost and expense,
shall (i) maintain all parts of the Premises in good condition, (ii) promptly
make all necessary repairs and replacements, including, but not limited to,
windows, glass and plate glass, exterior doors, nonstructural portions of
interior and exterior walls and finish work, interior doors and floor covering,
utility connections, downspouts, heating and air conditioning systems, light
bulbs and ballasts, truck doors, dock bumpers, paving, plumbing work and
fixtures, termite and pest extermination, regular removal of trash and debris,
and maintenance of dedicated sewer lines, and (iii) keep the parking areas,
driveways, truck aprons, and grounds of the Premises surrounding the Building in
a clean and sanitary condition.
(b) Tenant shall, at its own cost and expense, provide regularly scheduled
preventive maintenance/service for all hot water, heating and air conditioning
systems and equipment within the Premises. The maintenance must include all
services suggested by the equipment manufacturer within the
operation/maintenance manual.
Initials: __________ __________
Landlord Tenant
5
(c) Landlord agrees, at its expense, to maintain, repair and replace as
necessary, throughout the term of this Lease, the roof, gutters and structural
elements of the Building, including, without limitation, the foundations,
structural columns and beams and load-bearing walls. However, if Tenant, in
making any alterations pursuant to Paragraph 6 or installing equipment on the
roof pursuant to Paragraph 29 or otherwise, takes any action that causes
Landlord's warranty on the roof to become void or unenforceable with respect to
any required repairs, then Tenant will be required to make such repairs at its
expense.
6. ALTERATIONS. Tenant shall not make alterations, additions or improvements to
the Premises (i) that affect the Building's structure or exterior appearance, or
(ii) that would change any of the leasehold improvements installed by Landlord
at Landlord's expense for Tenant (the "Initial Leasehold Improvements") in any
manner that would materially reduce their value, without in either case
obtaining the prior written consent of Landlord, which consent will not be
unreasonably withheld. If Landlord consents to Tenant's contractors doing any
alteration exceeding $100,000 in cost, Landlord may require that Tenant provide,
at Tenant's expense, a lien and completion bond in an amount equal to 115% of
the estimated costs of improvements, additions or alterations in the Premises to
insure Landlord against any liability or mechanic's and materialmen's liens
which may arise in accordance with Paragraph 23 of this Lease and to insure
completion of the work. Tenant may, with prior notice to Landlord but without
obtaining Landlord's consent, at its own cost and expense and in a good
workmanlike manner, (i) make such nonstructural alterations, additions or
improvements that do not affect the Building's exterior appearance and that will
not change any Initial Leasehold Improvements in any manner that would
materially reduce their value, or (ii) erect, remove or alter such partitions,
or erect such shelves, bins, machinery and trade fixtures it may deem advisable,
without altering the basic character of the building or improvements and without
overloading or damaging such building or improvements, and in each case
complying with all applicable governmental laws, ordinances, regulations, and
other requirements. All alterations, additions, improvements and partitions
erected by Tenant (i.e., excluding the Initial Leasehold Improvements) shall be
and remain the property of Tenant provided, however, that, subject to the next
paragraph, Tenant shall, if Landlord so elects, remove all such alterations,
additions, improvements, and partitions erected by Tenant and repair any damage
caused by such removal by the date of termination of this Lease; otherwise such
improvements shall become the property of the Landlord as of the date of the end
of the term of this Lease (as such term may be extended pursuant to any
renewals, extensions or holdover period) and shall be delivered up to the
Landlord with the Premises. All shelves, bins, machinery and trade fixtures
installed by Tenant may be removed by Tenant prior to the termination of this
tease if Tenant so elects, and shall be removed if required by Landlord; upon
any such removal Tenant shall repair any damage caused by such removal. All such
removals and restoration shall be accomplished in good workmanlike manner so as
not to damage the primary structure or structural qualities of the building and
other improvements situated on the Premises.
Notwithstanding the foregoing, if Tenant asks Landlord, prior to
installing any alterations, if Tenant will be required to remove the same at the
end of the lease term, then Tenant will only be required to so remove such
alterations if Landlord so states within 30 days after the request.
7. SIGNS. Tenant shall have the right to install a sign upon the exterior of the
building only when first approved in writing by Landlord, not to be unreasonably
withheld. Such signage shall be subject to any applicable governmental laws,
ordinances, regulations, deed restrictions and architectural standards
reasonably set forth by Landlord. Tenant shall remove all such signs upon the
termination of this Lease. Such installations and removals shall be made in such
manner as to avoid injury to or defacement of the building and other
improvements. Tenant shall repair any injury or defacement caused by such
installation and/or removal, if so required by Landlord.
8. INSPECTION. Landlord and Landlord's agents and representatives shall have the
right to enter and inspect the Premises at any reasonable time during business
hours, for the purpose of ascertaining the condition of the Premises, after
reasonable prior notice to Tenant. Tenant may have a representative present
during any inspection by the Landlord, and may require a reasonable
confidentiality agreement be signed for access to areas where trade secrets are
readily apparent. During the period that is six (6) months prior to the end of
the term hereof, Landlord and Landlord's agents and representatives shall have
the right to enter the Premises at any reasonable time during business hours for
the purpose of showing the Premises and shall have the right to erect on the
Premises a suitable sign indicating that the Premises are available. Tenant
shall give written notice to Landlord at least thirty (30) days prior to
vacating the Premises and shall arrange to meet with Landlord for a joint
inspection of the Premises prior to vacating for the purpose of determining
Tenant's responsibility for repairs and restoration.
9. UTILITIES. Landlord agrees to provide the water, sewer, electricity, natural
gas, and telephone service connections to the Premises called for by the
Preliminary Plans upon the Commencement Date hereof, which connections shall
thereafter be maintained by Tenant. Tenant shall pay for all water, gas, heat,
light, power, telephone, sewer, sprinkler charges and other utilities and
services used on or at the Premises during the term, and any maintenance or
inspection charges for utilities. Landlord shall not be liable for any
interruption or failure of utility services on the Premises, unless caused by
Landlord.
10. ASSIGNMENT AND SUBLETTING. Tenant shall have the right to assign this Lease
or to sublet the whole or any part of the Premises upon notice to Landlord but
without the consent of the Landlord, provided that notwithstanding any
assignment or subletting, Tenant shall at all times remain directly, primarily
and fully responsible and liable for the payment of the rent herein specified
and for compliance with all of Tenant's other obligations under the terms,
provisions and covenants of this Lease (except that Tenant shall not remain so
responsible and liable in the event Tenant assigns this lease to the surviving
Initials: __________ __________
Landlord Tenant
6
entity in a merger or consolidation transaction with Tenant and Tenant ceases to
exist following such transaction). Upon the occurrence of an Event of Default,
if the Premises or any part thereof are then assigned or sublet, Landlord, in
addition to any other remedies herein provided or provided by law, may at its
option collect directly from such assignee or subtenant all rents becoming due
to Tenant under such assignment or sublease and apply such rent against any sums
due to Landlord from Tenant hereunder, and no such collection shall be construed
to constitute a novation or a release of Tenant from the further performance of
Tenant's obligations hereunder. Tenant may upon an assignment of Tenant's rights
under this Lease request that Landlord (and Landlord's mortgagee, if applicable)
release Tenant from all of its obligations arising hereunder from and after the
assignment in which event Landlord (and its mortgagee, if applicable) will not
unreasonably withhold such release, provided that the assignee assumes in
writing all of Tenant's obligations arising hereunder from and after the
assignment and provided further that the assignee has a credit rating, in the
case of a publicly-traded assignee, or a credit-worthiness, in the case of a
privately-held assignee, equal to the better of Tenant's credit rating (i) at
the time of execution of this Lease; or (ii) at the time of the assignment.
11. INSURANCE: FIRE AND CASUALTY DAMAGE.
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(a) Tenant agrees to maintain property insurance covering the Building,
Improvements and all alterations, additions, partitions and improvements erected
by, or on behalf of, Tenant in, on or about the Premises in an amount not less
than 100% of the "replacement cost" thereof as such term is defined in the
Replacement Cost Endorsement to be attached thereto (but excluding excavations,
foundations and footings), insuring against the perils of Fire, Lightning,
Vandalism and Malicious Mischief, extended by Special Extended Coverage
Endorsement to insure against all other risks of direct physical loss, such
coverages and endorsements to be as defined, provided and limited in the
standard bureau forms prescribed by the insurance regulatory authority for the
State of Colorado for use by insurance companies admitted in Colorado for the
writing of such insurance on risks located within Colorado. Such insurance shall
cover those risks of loss that a reasonable and prudent property owner of a like
or similar building located in Denver, Colorado would insure against, including
liability and loss of rents coverage. Landlord and its mortgagee will be named
as loss payees in the policy providing such property insurance on the
Improvements. All such policies shall be procured by Tenant from responsible
insurance companies reasonably satisfactory to Landlord and licensed in the
State of Colorado. Certificates of Insurance for each such policy of such
insurance, together with receipt evidencing payment of the premiums thereof or
shall be delivered to Landlord prior to the Commencement Date of this Lease. Not
less than fifteen (15) days prior to the expiration date of any such policies,
new Certificates of Insurance (bearing notations evidencing the payment of
renewal premiums) shall be delivered to Landlord. Such policies shall further
provide that not less than thirty (30) days written notice shall be given to
Landlord before such policy may be canceled or changed to reduce insurance
provided thereby. If requested by the holder of any indebtedness secured by a
mortgage or Deed of Trust covering the Premises, certified copies of the
insurance policies will need to be furnished in lieu of the certificates of
insurance.
(b) If the Improvements are damaged or destroyed by fire or other casualty at
any time subsequent to the ninth (9th) anniversary of the Commencement Date to
such an extent that a contractor selected by Tenant and reasonably approved by
Landlord reasonably determines that it will take longer than one hundred eighty
(180) days from the date of damage to complete the repairs and restoration
necessary to return the Premises to their condition immediately preceding such
casualty, then provided Tenant has maintained the insurance required by
Paragraph 11(a) and there will be no diminution in proceeds payable under such
insurance as a result of Tenant's election not to repair and restore the
Improvements, Tenant may elect to terminate this Lease by notice to Landlord
given not later than forty-five (45) days after the date on which such casualty
occurs. If Tenant so elects to terminate this Lease, then (A) this Lease will
terminate on a date selected by Tenant and set forth in such notice of
termination, which date must be no earlier than twenty (20) days after, and no
later than sixty (60) days after, the date of such notice; (B) prior to such
termination date, Tenant will demolish the Building and all other Improvements
that cannot function properly without the Building and return the Land to a
level, safe and sightly condition that complies with all applicable laws, unless
Landlord, within 10 days after receipt of Tenant's notice of termination
notifies Tenant that Landlord desires that Tenant not demolish the Building, in
which case Tenant will not demolish the Building; (C) all rent and other charges
payable hereunder by Tenant will be prorated to such termination date; and (D)
all proceeds of the insurance required to be maintained pursuant to Paragraph
11(a) that are payable as a result of such casualty will be paid to and become
the sole property of Landlord, except that Tenant will be entitled to
reimbursement from Landlord out of such proceeds for the reasonable costs
incurred by Tenant in performing such demolition and for all personal property
that is located on the Premises at the time of such casualty that is owned by
Tenant and that is covered by such property insurance.
(c) If the Improvements are damaged or destroyed by fire or other casualty and
Tenant does not terminate this Lease pursuant to Paragraph 11(b) or Tenant does
not have the right to terminate this Lease pursuant to Paragraph 11(b), then
this Lease will remain in full force and effect, Tenant will, at Tenant's cost
and expense, proceed with reasonable promptness and diligence to carry out any
necessary demolition and to repair and restore the Improvements to the condition
thereof that existed immediately prior to such casualty, and Tenant will be
entitled to an abatement of rent from the date of damage until such repairs and
restoration are substantially completed (but in no event will such abatement
exceed the proceeds of the loss of rents insurance to which Landlord is entitled
as a result of such casualty).
(d) Except as provided in Paragraph 11(b), the proceeds of the insurance
required to be maintained by Tenant pursuant to Paragraph 11(a) will be used by
Tenant to repair and restore the Improvements following a fire or other
casualty. If such proceeds are $50,000 or less, Landlord will execute such
endorsements or other instruments as may be necessary to cause
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the same to be paid to Tenant. If such proceeds exceed $50,000, they will be
paid to a trustee reasonably satisfactory to Landlord (Landlord and Tenant
acknowledge that a title insurance company of good reputation and reasonable
financial strength or Landlord's mortgagee will be acceptable as a trustee)
under instructions to disburse the same to Tenant in progress payments as the
repairs and restoration proceed upon application by Tenant for payment,
accompanying by (i) an architect's certificate (or other reasonably acceptable
evidence) that all labor for which payment is sought has been performed and all
materials for which payment is sought have been delivered to or incorporated in
the Premises; (ii) a waiver of mechanics' liens for all labor and materials paid
by the prior disbursement, if any; and (iii) reasonable evidence that the
remaining insurance proceeds will be sufficient to pay for the remaining work to
be completed (and if there are insufficient proceeds, then Tenant will pay for
all costs of repair and restoration until the remaining insurance proceeds will
cover the remaining costs, at which time progress payments may resume).
(e) Tenant and Landlord each hereby releases the other from any and all
liability or responsibility to the releaser or anyone claiming through or under
them by way of subrogation or otherwise for any loss or damage to property
caused by fire or any other perils insured in policies of insurance covering
such property, even if such loss or damage shall have been caused by the fault
or negligence of Tenant or Landlord, or anyone for whom such party may be
responsible, provided, however, that this release shall be applicable and in
force and effect only with respect to loss or damage occurring during such times
as the policy(ies) covering the releaser's property shall contain a clause or
endorsement to the effect that any such release shall not adversely affect or
impair said policy(ies) or prejudice the right of the releaser to recover
thereunder and then only to the extent of the insurance proceeds payable under
such policy(ies). Tenant agrees that it will request its insurance carriers to
include in its policies such a clause or endorsement.
12. LIABILITY. Landlord shall not be liable to Tenant or Tenant's employees,
agents, patrons or visitors, or to any other person whomsoever, for any injury
to person or damage to property on or about the Premises, caused by the
negligence or misconduct of Tenant, its agents, servants or employees, or of any
other person entering upon the Premises under express or implied invitation of
Tenant, or caused by the buildings and improvements located on the Premises
becoming out of repair, or caused by leakage of gas, oil, water or steam or by
electricity emanating from the Premises, or due to any cause whatsoever, unless
such injury or damage results from the negligence or willful misconduct of, or
breach of this Lease by, Landlord, and Tenant agrees to indemnify Landlord and
hold it harmless from any loss, expense or claims including attorneys' fees,
arising out of any such damage or injury to the extent caused by Tenant' s
negligence, misconduct or breach of this Lease. Tenant shall procure and
maintain throughout the term of this Lease a general liability policy or
policies of insurance, at its sole cost and expense, insuring both Landlord (as
an additional insured as respects Tenant's liability under the Lease) and Tenant
against all claims, demands, or actions arising out of or in connection with:
(i) the Premises; (ii) the condition of the Premises; and (iii) Tenant's
operations in and maintenance and use of the Premises. The limits of such policy
or policies should have a combined single limit of not less than $1,000,000 per
person and per occurrence in respect of injury to persons (including death) and
not less than $500,000 per occurrence in respect of property damage or
destruction, including loss of use thereof. All such policies shall be procured
by Tenant from responsible insurance companies reasonably satisfactory to
Landlord. Certificates of Insurance for each such policies, together with
receipts evidencing payment of premiums therefor, shall be delivered to Landlord
prior to the Commencement Date of this Lease, not less than fifteen (15) days
prior to the expiration date of any such policies, new Certificates of Insurance
(bearing notations evidencing the payment of renewal premiums) shall be
delivered to Landlord. Such policies shall further provide that not less than
thirty (30) days written notice shall be given to Landlord before such policy
may be canceled or changed to reduce insurance provided thereby. If requested by
the holder of any indebtedness secured by a mortgage or deed of trust covering
the Premises, certified copies of the insurance policies will need to be
furnished in lieu of the Certificates of Insurance.
From and after the Commencement Date, Tenant specifically agrees to
look solely to Landlord's interest in the Premises for the recovery of any
judgment from Landlord, it being agreed that Landlord or any of the joint
venture partners, including any successor or assignee of Landlord or the joint
venture partners, shall never be personally liable for any such judgment.
13. CONDEMNATION.
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(a) If the whole of the Premises should be taken for any public or quasi-public
use under governmental law, ordinance or regulation, or by right of eminent
domain, or by private purchase in lieu thereof, this Lease shall terminate and
the rent shall be abated during the unexpired portion of this Lease, effective
when the physical taking of said Premises shall occur. In addition, if more than
ten percent (10%) of the Building or more than twenty-five percent (25%) of the
paved area available on the Premises for use by Tenant should be so taken, then
Tenant will have the right to terminate this Lease by notice to Landlord given
within thirty (30) days after the physical taking of said Premises shall occur,
in which case this Lease shall terminate as provided above.
(b) If any portion of the Premises shall be taken for any public or quasi-public
use under any governmental law, ordinance or regulation, or by right of Eminent
Domain, or by private purchase in lieu thereof, and this Lease is not terminated
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pursuant to Paragraph 13(a), then this Lease shall remain in full force and
effect, but the rent payable hereunder during the unexpired portion of this
Lease shall be reduced by an amount proportional to the amount of building
square footage taken, in the case of a taking affecting the Building, and
proportional to the reduction in the fair market value of the Land, in the case
of a taking affecting any portion of the Land outside of the Building.
(c) All compensation awarded in connection with or as a result of any of the
foregoing proceedings shall be the property of Landlord and Tenant hereby
assigns any interest in any such award to Landlord; provided, however, Landlord
shall have no interest in any award made to Tenant for loss of business or
goodwill, the granting of a moving allowance, or for the taking of Tenant's
fixtures and improvements, if a separate award for such items is made to
Landlord. If the Premises are subject to any of the foregoing proceedings and
this Lease is not terminated, Landlord shall restore the Premises to the extent
practicable to their condition existing immediately prior to the taking,
provided that Landlord will not be required to expend more in doing so than the
amounts granted in the award for restoration of the Premises.
14. HOLDING OVER. At the termination of this Lease by expiration or otherwise,
Tenant immediately shall deliver possession to Landlord with all repairs and
maintenance required herein to be performed by Tenant completed. If, for any
reason, Tenant retains possession of the Premises after the expiration or
termination of this Lease, unless the parties hereto otherwise agree in writing,
such possession shall be subject to termination by either Landlord or Tenant at
any time upon not less than ten (10) days advance written notice, and all of the
other terms and provisions of this Lease shall be applicable during such period,
except that Tenant shall pay Landlord from time to time, upon demand, as rental
for the period of any hold over, an amount equal to 125% of the rent in effect
on the expiration or termination date, computed on a daily basis for each day of
the hold over period. No holding over by Tenant, whether with or without consent
of Landlord, shall operate to extend this Lease except as otherwise expressly
provided. The preceding provisions of this Paragraph 14 shall not be construed
as Landlord's consent for Tenant to hold over.
15. QUIET ENJOYMENT. Landlord covenants that it now has, or will acquire before
Tenant takes possession of the Premises, good title to the Premises, free and
clear of all liens and encumbrances, excepting only the lien for current taxes
not yet due, such mortgage or mortgages as are permitted by the terms of this
Lease, zoning ordinances and other building and fire ordinances and governmental
regulations relating to the use of such property, and easements, restrictions
and other conditions of record. Landlord represents and warrants that it has
full right and authority to enter into this Lease and that Tenant upon paying
the rental herein set forth and performing its other covenants and agreements
herein set forth, shall peaceably and quietly enjoy the Premises for the term
hereof, subject to the terms and provisions of this Lease.
16. EVENTS OF DEFAULT. The following events shall be deemed to be "Events
----------------- of Default" by Tenant under this Lease:
(a) Tenant shall fail to pay any installment of the rent hereby reserved when
due, or any other payment or reimbursement to Landlord required herein, and such
failure shall continue for a period of ten (10) days after the date of written
notice.
(b) Tenant shall become insolvent, or shall make a transfer in fraud of
creditors, or shall make an assignment for the benefit of creditors.
(c) Tenant shall file a voluntary petition under any section or chapter of the
National Bankruptcy Act, as amended, or under any similar law or statute of the
United States or any State thereof, or a petition shall be filed against Tenant
in any proceedings thereunder and shall not be discharged within sixty (60) days
or Tenant shall be adjudged bankrupt, or insolvent in proceedings filed against
Tenant thereunder.
(d) A receiver or trustee shall be appointed for all or substantially all of the
assets of Tenant and such receiver shall not be discharged within sixty (60)
days after his or her appointment.
(e) Tenant shall fail to comply with any term, provision or covenant of this
Lease (other than the foregoing in this Paragraph 16), and shall not cure such
failure within thirty (30) days after written notice thereof to Tenant, or such
longer time as may be reasonably necessary, provided that Tenant commences to
cure the same within ten (10) days after notice and diligently prosecutes such
curing to completion.
17. REMEDIES. Upon the occurrence of an Event of Default described in
-------- Paragraph 16 hereof, Landlord shall have the option to
pursue any one or more of the following remedies without any notice or demand:
(a) Terminate this Lease, in which event Tenant shall immediately surrender the
Premises to Landlord, and if Tenant fails so to do, Landlord may, with process
of law but without prejudice to any other remedy which it may have for
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possession or arrearages in rent, enter upon and take possession of the Premises
and expel or remove Tenant or any other person who may be occupying such
Premises or any part thereof, without being liable for prosecution or any claim
of damages therefor; and Tenant agrees to pay to Landlord on demand the amount
of any loss and damage which Landlord may suffer by reason of such termination,
whether through inability to relet the Premises on satisfactory terms or
otherwise.
(b) With process of law, enter upon and take possession of the Premises and
expel or remove Tenant and any other person who may be occupying such Premises
or any part thereof, without being liable for prosecution or any claim of
damages therefor; and relet the Premises and receive the rent therefor; and
Tenant agrees to pay to the Landlord on demand any deficiency that may arise by
reason of such reletting (provided that in determining any such deficiency, all
costs incurred by Landlord to put the replacement tenant into possession, such
as brokerage fees or the costs of alterations to the Premises, will be amortized
on a straight-line basis over the term of the new lease). In the event Landlord
is successful in reletting the Premises at a rental in excess of that agreed to
be paid by Tenant pursuant to the terms of this Lease, Landlord and Tenant each
mutually agree that Tenant shall not be entitled, under any circumstances, to
such excess rental, and Tenant does hereby specifically waive any claim to such
excess rental.
(c) Terminate this Lease and treat the Event of Default as an entire breach of
this Lease and Tenant immediately shall become liable to Landlord for damages
for the entire breach in the amount equal to the amount by which the total rent,
as adjusted by the amount of additional rent which would be payable by Tenant
during the unexpired balance of their term of this Lease and all other payments
due for the balance of the term is in excess of the fair market rent value of
the Premises for the balance of the term as of the time of default, both
discounted to the then present value on a monthly basis at a discount rate equal
the rate of the U.S. Treasury securities offered at the time of the award having
a maturity closest to the date on which the term would have ended but for the
early termination. Such amount shall be due and payable upon landlord's notice
to Tenant of termination of the Lease and shall bear interest until paid at the
rate provided by law for interest on judgments.
(d) Enter upon the Premises, without being liable for prosecution or any claim
of damages therefor, and do whatever Tenant is obligated to do under the terms
of this Lease; and Tenant agrees to reimburse Landlord on demand for any
expenses which Landlord may incur in thus effecting compliance with Tenant's
obligations under this Lease, and Tenant further agrees that Landlord shall not
be liable for any damages resulting to the Tenant from such action, whether
caused by the negligence of Landlord or otherwise.
(e) Receive payment from Tenant, in addition to any sum provided to be paid
above, for any and all of the following expenses for which Tenant shall be
considered liable (provided that in the case of any of the costs described in
items 1 and 3 below that are incurred in connection with a reletting of the
Premises, such costs shall be amortized over the life of the new lease on a
straight-line basis and Tenant shall only be responsible for the portion of such
costs attributable to the portion of such new term that falls within the
original term of this Lease and then only to the extent that in any month the
rent received from such reletting is less than the sum of such amortized cost
for such month and the amount of rent that would have been due under this Lease
for such month):
1 Broker's fees incurred by Landlord in connection with
reletting the whole or any part of the Premises;
2 The cost of removing and storing Tenant's or other
occupant's property;
3. The cost of repairing, altering, remodeling or otherwise
putting the Premises into condition, acceptable to a new
tenant or tenants, plus a reasonable charge to cover
Landlord's overhead; and
4. All reasonable expenses incurred by Landlord in enforcing
Landlord's remedies.
In the event Tenant fails to pay any installment of rent or other
payment due hereunder within five (5) days as and when such installment is due,
to help defray the additional cost to Landlord for processing such late payments
Tenant shall pay to Landlord on demand a late charge in an amount equal to five
percent (5%) of such installment; and the failure to pay such late charges
within ten (10) days after demand therefor shall be an Event of Default
hereunder; provided, however, that no such late charge will be due for the first
such late payment made by Tenant within any twelve (12) consecutive month
period. The provision for such late charge shall be in addition to all of
Landlord's other rights and remedies hereunder or at law and shall not be
construed as liquidated damages or as limiting Landlord's remedies in any
manner.
Pursuit of any of the foregoing remedies shall not preclude pursuit of
any of the other remedies herein provided or any other remedies provided by law,
nor shall pursuit of any remedy herein provided constitute a forfeiture or
waiver of any rent due to Landlord hereunder or of any damages accruing to
Landlord by reason of the violation of any of the terms, provisions and
covenants herein contained. No act or thing done by the Landlord or its agents
during the term hereby granted shall be deemed a termination of this Lease or an
acceptance of the surrender of the Premises, and no agreement to terminate this
Lease or to accept
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a surrender of said Premises shall be valid unless in writing and signed by
Landlord, no waiver by Landlord of any violation or breach of any of the terms,
provisions and covenants herein contained shall be deemed or construed to
constitute a waiver of any other violation or breach of any of the other terms,
provisions and covenants herein contained. Landlord's acceptance of the payment
of rental or other payments hereunder after the occurrence of an Event of
Default shall not be construed as a waiver of such default, unless Landlord so
notifies Tenant in writing or unless the default was a failure to pay such rent
or other payment. Forbearance by Landlord to enforce one or more of the remedies
herein provided upon an Event of Default shall not be deemed or construed to
constitute a waiver of such default or of any subsequent default. In the event
of any litigation between Landlord and Tenant concerning either party's rights
or obligations under this Lease, the prevailing party (meaning the party that
obtains substantially all of the relief it is seeking) will be entitled, in
addition to such relief, to an award for its reasonable attorneys' fees and
expenses incurred in connection with such litigation.
18. MORTGAGES.
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(a) This Lease shall be subordinate to any deed of trust, mortgage, or other
security instrument (a "Mortgage"), that now or hereafter covers all or any part
of the Premises, provided that the holder of such Mortgage agrees, within in the
Mortgage or in a separate agreement with Tenant, that, so long as no Event of
Default has occurred and is continuing hereunder, no foreclosure or deed in lieu
of foreclosure with respect to such Mortgage will result in termination of this
Lease or disturbance of Tenant's rights hereunder. The mortgagee under any
Mortgage is referred to herein as "Landlord's Mortgagee".
(b) Tenant shall attorn to any party succeeding to Landlord's interest in the
Premises, whether by purchase, foreclosure, deed in lieu of foreclosure, power
of sale, termination of lease, or otherwise, upon such party's request, and
shall execute such agreements confirming such attornment as such party may
reasonably request. In the event of such request and upon Tenant's attornment as
aforesaid, Tenant will automatically become the tenant of the successor to
Landlord's interest without change in the terms or provisions of this Lease;
provided, however, that such successor to Landlord's interest shall not be bound
by (i) an payment of Rent for more than one month in advance (except prepayments
for security deposits, if any), (ii) any amendments or modifications of this
Lease made without the prior written consent of Landlord's Mortgagee if Tenant
was advised on the interest of the same, or (iii) any credits, offsets, defenses
or claims which Tenant may have against Landlord, except for matters that are
continuing.
(c) Tenant shall not seek to enforce any remedy it may have for any default on
the part of the Landlord without first giving written notice by certified mail,
return receipt requested, specifying the default in reasonable detail, to any
Landlord's Mortgagee, whose address has been given to Tenant, and affording such
Landlord's Mortgagee a reasonable opportunity to perform Landlord's obligations
hereunder. Subject to the provisions of Paragraph 12 hereof, Landlord reserves
the right, without notice to or consent of the Tenant, to assign this Lease
and/or any and all rents hereunder as security for the payment of any Mortgage.
(d) Tenant and Landlord agree at any time and from time to time during the Term
to execute, acknowledge and deliver to the other party within ten (10) days of
any request by the other party, a statement or statements, in writing,
certifying (if such be true) that a copy of this Lease and any amendments hereto
are true and correct copies, this Lease is unmodified and in good standing (or
if modified, then in good standing as modified, stating the modification), the
date to which all rent and other charges hereunder have been paid in advance,
and any other items reasonably requested. From time to time, Tenant shall
furnish to any Landlord's Mortgagee, within ten (10) days after a request
therefor, such estoppel certificates, subordination, non-disturbance and
attornment agreements, or other certificates as Landlord's Mortgagee may
reasonably request.
(e) Landlord acknowledges that Tenant has acquired equipment, inventory and
other personal property and may acquire additional equipment, inventory and
other personal property (collectively, the "Equipment") under the terms of one
or more credit agreements with one or more lenders pursuant to which such
lenders finance Tenant's purchase of all or a portion of the Equipment. Landlord
further acknowledges that a portion of the Equipment will be installed in or
located at the Premises. Landlord hereby disclaims any interest in the
Equipment. Landlord further (i) waives, disclaims and releases any claim of
ownership of or lien on or security interest in all or any part of the
Equipment, whether consensual, statutory or otherwise; (ii) to the fullest
extent permitted by law, waives all rights granted by or under any present or
future law to levy or distraint on the Equipment, for any sums due to Landlord;
(iii) acknowledges that, regardless of the mode or manner of installation of the
Equipment, the Equipment is and will continue to be personal property of Tenant
or the vendor of the Equipment, as the case may be; (iv) acknowledges that the
lenders under the credit agreements have (or may have) financed Tenant's
purchase of all or portion f the Equipment and, to the extent that any of the
Equipment has been so financed, the lenders have a security interest in such
Equipment; and (v) agrees that the lenders and their agents may, form time to
time in accordance with the credit agreements, enter the Premises for the
purposes of inspection, repairing, removing and/or conducting a sale or sales of
the Equipment.
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19. LANDLORD'S DEFAULT.
------------------
(a) In the event Landlord should default in any of its obligations hereunder,
Tenant shall simultaneously give Landlord and Landlord's Mortgagee written
notice specifying such default and Landlord shall thereupon have thirty (30)
days (plus an additional reasonable period as may be required in the exercise by
Landlord of due diligence) in which to cure any such default. In addition,
Landlord's Mortgagee shall have the right (but not the obligation) to cure or
remedy such default during the period of thirty (30) days (plus an additional
reasonable period as may be required in the exercise by Landlord's Mortgagee of
due diligence) following Landlord's Mortgagee's receipt of written notice of
default, and Tenant will accept such curative or remedial action taken by
Landlord's Mortgagee with the same effect as if such action had been taken by
Landlord.
(b) Upon the failure of Landlord or Landlord's Mortgagee to cure such default in
accordance with the provisions of Paragraph 19(a) hereof, Tenant shall be
authorized and empowered to take such action as may be necessary to cure the
default, and the amount paid by Tenant in curing such default for and on behalf
of Landlord, together with interest thereon at the rate of twelve percent (12%)
per annum from the date paid by Tenant until the date reimbursed to Tenant with
interest, shall be payable on demand by Landlord to Tenant. If Landlord fails to
pay any such amount within ten (10) days after notice, then Tenant may offset
the amount due from Landlord to Tenant against the next ensuing installments of
rent due hereunder; provided, however, that Tenant will only be permitted to
offset against each monthly installment rent hereunder an amount not exceeding
twenty-five percent (25%) of the amount of such installment of rent and, if such
monthly offset does not total the aggregate amount of Tenant's expenses which
are allowable for offset, the remaining balance thereof may be carried forward
and offset against future installments of rent, but Tenant may never offset more
than twenty-five percent (25%) of any monthly installment of rent.
(c) Pursuit of any of the foregoing remedies shall not preclude pursuit of any
of the other remedies herein provided or any other remedies provided by law, nor
shall pursuit of any remedy herein provided constitute a forfeiture or waiver of
any damages accruing to Tenant by reason of the violation of any of the terms,
provisions and covenants herein contained. No waiver by Tenant of any violation
or breach of any of the terms, provisions and covenants herein contained shall
be deemed or construed to constitute a waiver of any other violation or breach
of any of the other terms, provisions and covenants herein contained.
Forbearance by Tenant to enforce one or more of the remedies herein provided
upon an Event of Default by Landlord shall not be deemed or construed to
constitute a waiver of such default or of any subsequent default. In the event
of any litigation between Landlord and Tenant concerning either party's rights
or obligations under this Lease, the prevailing party (meaning the party that
obtains substantially all of the relief it is seeking) will be entitled, in
addition to such relief, to an award for its reasonable attorneys' fees and
expenses incurred in connection with such litigation.
20. ASSIGNMENT BY LANDLORD. Landlord shall have the right to assign or transfer,
in whole or in part every feature of its rights and obligations hereunder and
the Premises provided such assignee or transferee recognizes and agrees to be
bound by the terms of this Lease. Such assignments or transfers may be made to a
corporation, trust, trust company, individual or group of individuals, and
howsoever made shall be in all things respected and recognized by Tenant. Prior
to the Commencement Date, Landlord may assign or transfer its rights hereunder
only to entities in which InSite Realty Partners L.P. and Urban Construction
have a controlling interest and are serving as the developer and general
contractor.
21. FORCE MAJEURE. Whenever a period of time is herein prescribed for action to
be taken by either party, such party will not be liable or responsible for, and
there will be excluded from the computation of any such period of time, any
delays due to strikes, riots, acts of God, shortages of labor or materials, war,
governmental laws, regulations or restrictions or any other causes of any kind
whatsoever which are beyond the reasonable control of such party. Nothing set
forth herein will in any event excuse the late payment of any rent or other
charges due from one party to the other pursuant to this Lease.
22. MECHANIC'S LIENS. Tenant shall have no authority, express or implied, to
create or place any lien or encumbrance, of any kind or nature whatsoever, upon,
or in any manner to bind, the interest of Landlord in the Premises for any claim
in favor of any person dealing with Tenant, including those who may furnish
materials or perform labor for any construction or repairs, and each such claim
shall affect and each such lien shall attach to, if at all, only the leasehold
interest granted to Tenant by this instrument. Tenant covenants and agrees that
it will pay or cause to be paid all sums legally due and payable by it on
account of any labor performed or materials furnished in connection with any
work performed on the Premises on which any lien is or can be validly and
legally asserted against its leasehold interest in the Premises or the
improvements thereon, and that it will save and hold Landlord harmless from any
and all loss, cost or expense based on or arising out of asserted claims or
liens against the leasehold estate, or against the right, title and interest of
the Landlord in the Premises or under the terms of this Lease.
23. NOTICES. Each provision of this instrument or of any applicable governmental
laws, ordinances, regulations and other requirements with reference to the
sending, mailing, or delivery by courier or otherwise of any notice or the
making of any payment by Landlord to Tenant or with reference to the sending,
mailing or delivery of any notice or the making of any payment by Tenant to
Landlord shall be deemed to be complied with when and if the following steps are
taken:
Initials: __________ __________
Landlord Tenant
11
(a) All rent and other payments required to be made by Tenant to Landlord
hereunder shall be payable to Landlord at the address hereinbelow set forth or
at such other address as Landlord may specify from time to time by written
notice delivered in accordance herewith. Tenant's obligation to pay rent and any
other amounts to Landlord under the terms of this Lease shall not be deemed
satisfied until rent and other amounts have been actually received by Landlord.
(b) All payments required to be made by Landlord to Tenant hereunder shall be
payable to Tenant at the address hereinbelow set forth, or at such other address
within the continental United States as Tenant may specify from time to time by
written notice delivered in accordance herewith.
(c) Any notice or document required or permitted to be delivered hereunder shall
be deemed to be delivered whether actually received or not (i) three (3)
business days after deposited in the United States Mail, postage prepaid,
Certified or Registered Mail, or (ii) one (1) business day after deposited for
next business day delivery with Federal Express or another nationally-recognized
overnight courier service that provides evidence or receipt, in either case
addressed to the parties hereto at the respective addresses set out below, or at
such other address as they have theretofore specified by written notice
delivered in accordance herewith:
LANDLORD: TENANT:
DOVE VALLEY BUSINESS CENTER, LLLP KOALA CORPORATION
c/o InSite Realty Partners L.P. 00000 Xxxx 00xx Xxxxxx, Xxxx X
0000 Xxxxxxx, Xxxxx 000 Xxxxxx, Xxxxxxxx 00000-0000
Xxxxxxx, Xxxxx 00000 Attention: Xxxx Xxxxxx
Attention: Xxxx X. Xxxxxxxxx and Xxx Xxxxxxxx
If and when included within the term "Landlord", as used in this
instrument, there are more than one person, firm or corporation, all shall
jointly arrange among themselves for their joint execution of such a notice
specifying some individual at some specific address for the receipt of notices
and payments to Landlord; if and when included within the term "Tenant", as used
in this instrument, there are more than one person, firm or corporation, all
shall jointly arrange among themselves for their joint execution of such a
notice specifying some individual at some specific address within the
continental United States for the receipt of notices and payments to Tenant. All
parties included within the terms "Landlord" and "Tenant", respectively, shall
be bound by notices given in accordance with the provisions of this Paragraph to
the same effect as if each had received such notice.
24. MISCELLANEOUS.
-------------
(a) Words of any gender used in this Lease shall be held and construed to
include any other gender and words in the singular number shall be held to
include the plural, unless the context otherwise requires.
(b) The terms, provisions, covenants and conditions contained in this Lease
shall apply to, inure to the benefit of, and be binding upon, the parties hereto
and upon their respective heirs, legal representatives, successors and permitted
assigns except as otherwise herein expressly provided.
(c) This Lease shall be treated as an offer with the Premises being subject to
prior lease and such offer subject to withdrawal or non-acceptance by Landlord
or to other use of the Premises without notice, and this Lease shall not be
valid or binding unless and until accepted by Landlord in writing and a fully
executed copy delivered to both parties.
(d) The captions inserted in this Lease are for convenience only and in no way
define, limit or otherwise describe the scope or intent of this Lease, or any
provision hereof, or in any way affect the interpretation of this Lease.
(e) All obligations of Tenant hereunder not fully performed upon the expiration
or earlier termination of the term of this Lease shall survive the expiration or
earlier termination of the term hereof, including, without limitation, all
payment obligations with respect to taxes and insurance and all obligations
concerning the condition of the Premises. Upon the expiration or earlier
termination of the term hereof, and prior to Tenant vacating the Premises,
Tenant shall pay to Landlord any amount reasonably estimated by Landlord as
necessary to put the Premises, including, without limitation, all heating and
air conditioning systems and equipment therein, in good condition and repair.
Tenant shall also, prior to vacating the Premises, pay to Landlord the amount,
as estimated by Landlord, of Tenant's obligation hereunder for real estate taxes
and insurance premiums for the portion of the year in which the Lease expires or
terminates that falls within the term. All such amounts shall be used and held
by Landlord for payment of such obligations of Tenant hereunder, with Tenant
being liable for any additional costs therefor upon demand by Landlord, or with
any excess to be returned to Tenant after all such obligations have been
determined and satisfied, as the case may be. Any security deposit held by
Landlord shall be credited against the amount payable by Tenant under this
Paragraph 24(e).
Initials: __________ __________
Landlord Tenant
12
(f) If any clause or provision of this Lease is illegal, invalid or
unenforceable under present or future laws effective during the term of this
Lease, then and in that event, it is the intention of the parties hereto that
the remainder of this Lease shall not be affected thereby, and it is also the
intention of the parties to this Lease that, in lieu of each clause or provision
of this Lease that is illegal, invalid or unenforceable, there be added as a
part of this Lease contract a clause or provision as similar in terms to such
illegal, invalid or unenforceable clause or provision as may be possible and be
legal, valid and enforceable.
(g) All references in this Lease to "the date hereof" or similar references
shall be deemed to refer to the last date, in point of time, on which all
parties hereto have executed this Lease.
(h) This Lease may not be altered, changed or amended except by an instrument in
writing signed by both parties hereto.
(i) Landlord and Tenant acknowledge and agree that this Lease shall be
interpreted and enforced in accordance with the laws of the State of Colorado.
(j) Each party agrees to furnish to the other, promptly upon demand, a corporate
resolution, proof of due authorization by partners, or other appropriate
documentation evidencing the due authorization of such party to enter into this
Lease.
(k) This Lease may be signed in any number of counterparts, each of which shall
be an original for all purposes, but all of which taken together shall
constitute only one agreement. The production of any executed counterpart of
this Lease shall be sufficient for all purposes without producing or accounting
for the other counterparts hereof.
25. HAZARDOUS MATERIALS.
-------------------
(a) At all times during the term of this Lease, Tenant covenants and agrees that
Tenant shall not cause or permit any Hazardous Material (hereinafter defined) to
be brought upon, kept, or used in or about the Premises by Tenant, its agents,
employees, customers, clients, invitees, licensees, or contractors without the
express prior written consent of Landlord, except that Tenant may transport to
and from and store and use on the Premises normal quantities of Hazardous
Material customarily used for Tenant's Intended Use, provided that all of such
transportation, storage and use shall be accomplished in accordance with
Environmental Law (hereinafter defined) . As used herein, the term "Hazardous
Material" means any pollutant, toxic substance, hazardous waste, hazardous
material, hazardous substance, or oil as defined in or pursuant to the Resource
Conservation and Recovery Act, as amended, the Comprehensive Environmental
Response, Compensation, and Liability Act, as amended, the Federal Clean Water
Act, as amended, or any other federal, state, or local environment law,
regulation, ordinance, rule, or bylaw, whether existing as of the date hereof,
previously in force, or subsequently enacted governing the transportation, use,
generation or storage of such materials ("Environmental Law").
(b) Tenant shall indemnify, defend and hold the Premises and Landlord, its
directors, officers, employees, agents, partners, assigns and successors to
Landlord's interest in the Premises, free and harmless from and against any and
all loss, cost, damage, expense (including attorney's fees), claim, cause of
action, judgment, penalty, fine or liability (including, without limitation
diminution in the value of the Premises or any portion thereof, damages for the
loss or restriction on use of rentable or usable space within the Premises), or
of any amenity of the Premises and damages arising from any adverse impact on
the marketing of space within the Premises, arising from the use, generation,
storage, transportation, handling or disposal of Hazardous Materials by Tenant
or any of Tenant's agents, in, on or about the Premises during the term of this
Lease or any extension thereof. Tenant's obligations pursuant to the foregoing
indemnity shall survive the expiration or sooner termination of this Lease and
shall bind Tenant's successors and assigns and insure to the benefit of
Landlord's successors and assigns. Tenant's indemnification shall include and
cover without by way of limitation, any and all costs incurred in connection
with any investigation of site conditions or any clean-up, remedial removal or
restoration work required by federal, state or local government agency or
political subdivision because of the use, generating, storage, transportation,
handling or disposal of Hazardous Materials by Tenant or Tenant's agents in, on
or about the Premises. Any costs or expenses incurred by Landlord for which
Tenant is responsible or for which Tenant has indemnified Landlord shall be
reimbursed by Tenant upon demand as additional rent.
(c) Landlord represents to Tenant that, except as disclosed in the Phase I
environmental assessment report concerning the Land obtained by Landlord and a
copy of which has been delivered to Tenant ("Landlord's Phase I Report"), to the
best of Landlord's knowledge the Land has not been used for the storage,
generation or use of Hazardous Materials and there are no Hazardous Materials
present on the Land in any quantity or matter that violates or gives rise to
liability under any Environmental Law. Landlord covenants that it will not
incorporate any Hazardous Materials into the Improvements constructed by
Landlord pursuant to this Lease (other than such Hazardous Materials as are
customarily incorporated into improvements of the same type as the Building as
of the time of construction thereof and, in any event, in compliance with all
Environmental
Initials: __________ __________
Landlord Tenant
13
Law). Landlord will indemnity, defend and hold Tenant harmless from and against
any all loss, cost, damage, expense (including attorney's fees), claim, cause of
action, judgment, penalty, fine or liability arising from the breach by Landlord
of its representations and covenants set forth in this Paragraph 25(c).
Landlord's obligations pursuant to the foregoing indemnity shall survive the
expiration or sooner termination of this Lease and shall bind Landlord's
successors and assigns and insure to the benefit of Tenant's successors and
assigns.
(d) At Tenant's sole cost and expense, Tenant may conduct an environmental
assessment of the Premises in order to establish a "base-line" of the
environmental condition of the Premises as of Tenant's commencement of occupancy
of the Premises ("Tenant's Phase I Report"). Tenant agrees to deliver to
Landlord a written copy of Tenant's Phase I Report within fifteen (15) days of
Tenant's receipt of same. Tenant agrees to maintain the results of such
environmental assessment in confidentiality and not to disclose or release the
results of such environmental assessment to any third parties or governmental
agencies without Landlord's prior written consent unless such disclosure is
required by applicable law or regulation or in the event of a dispute between
Landlord and Tenant relating to the environmental condition of the Premises;
provided, however, Tenant shall notify Landlord of such disclosure at the time
of such disclosure. If Tenant does not elect to obtain Tenant's Phase I Report,
then Landlord's Phase I Report will serve as such a "base-line," except as to
any Hazardous Materials introduced by Landlord prior to the Commencement Date.
26. BROKERAGE. Tenant and Landlord represent and warrant that they have dealt
with no broker, agent or other person in connection with this transaction and
that no broker, agent or other person brought about this transaction, other than
Xxxxx Xxxxxx of CB Xxxxxxx Xxxxx, and each party agrees to indemnify and hold
the other harmless from and against any claims by any other broker, agent or
other person claiming a commission or other form of compensation by virtue of
having dealt with the indemnifying party with regard to this leasing
transaction. The provisions of this Paragraph shall survive the termination of
this Lease.
27. SECURITY. Any and all security of any kind for Tenant, Tenant's agents,
employees or invitees, the Premises, or any personal property thereon
(including, without limitation, any personal property of any sublessee) shall be
the sole responsibility and obligation of Tenant, and shall be provided by
Tenant at Tenant's sole cost and expense. Tenant acknowledges and agrees that
Landlord shall have no obligation or liability whatsoever with respect to the
same. Tenant shall indemnify and hold Landlord harmless from and against any and
all loss, cost, damage or other liability arising directly or indirectly from
security measures or the absence thereof with respect to the Premises and the
building of which the Premises are a part. Tenant may, at Tenant's sole cost and
expense, install alarm systems in the Premises provided such installation
complies with the provisions of Paragraph 6 hereof. Removal of such alarm
systems shall be Tenant's sole responsibility and, at Tenant's sole cost and
expense, shall be completed prior to Lease termination and all affected areas of
the Premises shall be repaired and/or restored in a good and workmanlike manner
to the condition that existed prior to such installation.
28. WARRANTIES. Landlord shall correct or complete all punchlist items as soon
as reasonably possible, but in no event longer than 60 days from the
Commencement Date (subject to extension for force majeure). Landlord agrees to
correct, at its expense, any and all latent defects of which Tenant notifies
Landlord within one year from the Commencement Date. Landlord warrants that the
building and all leasehold improvements installed by Landlord for Tenant will be
completed in a good and workmanlike manner, in compliance with the applicable
permitting agencies requirements, including the ADA, in effect as of the
commencement date. Landlord warrants that the natural gas service installed by
Landlord to serve the Premises will have capacity equal to at least 2.0 lbs.
pressure for 60,000 C.F.H. load.
29. SATELLITE DISH. Tenant shall have the right to install, at its expense and
in compliance with all applicable laws, a satellite dish or similar type of
antenna on or about the roof of the Building. Landlord shall not charge Tenant
any additional fees for said dish or antenna. Tenant shall be solely responsible
and pay for any damage as a result of said installation and/or removal. Prior to
installation, Tenant will obtain Landlord's approval as to the location and
manner of installation, which approval will not be unreasonably withheld,
provided that neither the proposed location nor the proposed manner of
installation would in any way void or make unenforceable the warranty covering
the roof.
30. CONFIDENTIALITY. Landlord and Tenant each agrees that it will not issue
--------------- any public statements or issue any press releases
concerning the transaction contemplated by this Lease without first obtaining
the other party's written approval.
31. EXPANSION OPTION.
----------------
(a) Landlord grants Tenant an option (the "Expansion Option") to cause the
Building to be expanded by between 50,000 and 100,000 square feet (the
"Expansion") in accordance with the provisions of this Paragraph 31. If at any
time during the first sixteen (16) full calendar months of the term of this
Lease, Tenant desires the Expansion, Tenant will notify Landlord in writing of
such desire (the "Expansion Notice"). Tenant's Expansion Notice must (i) be
given prior to the expiration of the sixteenth (16th) full calendar month of the
term; (ii) be given before the termination of the Expansion Option pursuant to
Initials: __________ __________
Landlord Tenant
14
Paragraph 31(b) below; (iii) describe in reasonable detail the Expansion
requested by Tenant, including the size in square feet and proposed use of each
type of space to be included in the Expansion (such as, for example, 5,000
square feet of office space and 60,000 square feet of warehouse/manufacturing
space), the level of finish required in each type of space, and any site
improvements or other special requirements that are to be included in the
Expansion; and (iv) call for an Expansion having at least 50,000 square feet and
not more than 100,000 square feet.
(b) The parties acknowledge that Landlord has an option to purchase a parcel of
land consisting of approximately 4.63 acres that is located adjacent to and
north of the Land (the "Expansion Area"). If Tenant exercises its Expansion
Option, the Expansion will be constructed on the Expansion Area. Such option to
purchase the Expansion Area will expire one year from the date on which Landlord
closes on its acquisition of the Land (the "Land Acquisition Date"), unless
prior to the first anniversary of the Land Acquisition Date, Landlord extends
such option for a one-year period by paying an extension payment of $9,148 (the
"First Extension Payment"), in which case such option will expire on the second
anniversary of the Land Acquisition Date unless, prior to such anniversary,
Landlord extends such option for an additional one-year period by paying an
additional extension payment of $9,148 (the "Second Extension Payment"), in
which case such option will expire on the third anniversary of the Land
Acquisition Date. If the "Expansion Amendment" (as defined below) has not then
been signed, at least sixty (60) days prior to the first anniversary of the Land
Acquisition Date, Landlord will notify Tenant of the date on which such first
anniversary will occur and Tenant, if Tenant desires to keep its Expansion
Option in effect, must pay to Landlord the amount of the First Extension Payment
at least thirty (30) days prior to the first anniversary of the Land Acquisition
Date. If Tenant fails to do so, then Tenant's Expansion Option under this
Paragraph 31 will terminate. If the Expansion Amendment has not then been signed
and Tenant's Expansion Option is still then in effect, at least sixty (60) days
prior to the second anniversary of the Land Acquisition Date, Landlord will
notify Tenant of the date on which such second anniversary will occur and
Tenant, if Tenant desires to keep its Expansion Option in effect, must pay to
Landlord the amount of the Second Extension Payment at least thirty (30) days
prior to the second anniversary of the Land Acquisition Date. If Tenant fails to
do so, then Tenant's Expansion Option under this Paragraph 31 will terminate.
(c) Within two (2) weeks after timely delivery of Tenant's Expansion Notice,
Landlord will prepare and deliver to Tenant sketch plans and specifications for
the proposed Expansion and a proposed budget for all costs of its design and
construction (including the cost of acquiring the Expansion Area and financing
the construction of the Expansion). During the two (2) week period following
Landlord's delivery of such sketch plans and specifications and budget, Landlord
will cooperate with Tenant to refine such plans and specifications to produce
preliminary plans and specifications for the Expansion (the "Preliminary
Expansion Plans") that are acceptable to Tenant and of a level of detail similar
to the Preliminary Plans for the Building attached hereto as Exhibit "B" and
develop a final budget for the Expansion, as shown on the Preliminary Expansion
Plans (the "Expansion Budget"). If Tenant fails to approve in writing the
Preliminary Expansion Plans and the Expansion Budget within two (2) weeks after
Landlord's delivery of the sketch plans and proposed budget, then Tenant will be
deemed to have withdrawn its Expansion Notice and the same will have no further
force or effect. If Tenant does so approve the Preliminary Expansion Plans and
the Expansion Budget, then, within one (1) month thereafter, the parties will
execute an amendment to this Lease (the "Expansion Amendment") that provides for
the following:
1. Landlord will prepare construction plans and specifications
for the Expansion which will be subject to Tenant's review
and approval, which will not be unreasonably withheld or
delayed and will be limited in scope to confirming that the
same conform to the Preliminary Expansion Plans;
2. Landlord will construct the Expansion in accordance with the
construction plans and specifications approved by Tenant
within a reasonable construction period projected by
Landlord at the time the Expansion Amendment is signed
(subject to delays caused by force majeure);
3. Upon Substantial Completion of the Expansion, Landlord and
Tenant will prepare a punchlist of items in the Expansion
requiring completion or correction and Landlord will
complete or correct the same within thirty (30) days;
4. Landlord will provide a warranty with respect to the
Expansion for a period of one year from its Substantial
Completion like the warranty provided with respect to the
original Building pursuant to this Lease; and
Initials: __________ __________
Landlord Tenant
15
5. Upon Substantial Completion of the Expansion, (a) the
Premises will be deemed amended to include the Expansion
Area and the Expansion; (b) the term of this Lease will be
extended to be a full ten (10) years from the date of such
Substantial Completion (plus, if the date of Substantial
Completion is other than the first day of a month, the
period from such date to the first day of the next month);
(c) the rent for the original Premises will continue on the
schedule set forth in Paragraph 2(a) and for the extended
portion of the term (i.e., the extension necessary to make
the term a full ten (10) years from Substantial Completion
of the Expansion) the rent for the original Premises will be
payable at the same amount per month as is payable for the
original Premises during months 91 through 120, as shown in
such schedule (and the rent for the renewal terms, if Tenant
should exercise the same, will remain unchanged as to the
original Premises); (d) the rent for the Expansion and
Expansion Area for each of the first full thirty (30) months
following the Substantial Completion thereof (with proration
of any partial month from the Substantial Completion date to
the next month) will be equal to one-twelfth (1/12) of the
amount obtained by multiplying the total Expansion Budget
approved by Tenant by (i) 10.5%, if the Expansion Amendment
is signed during the first twelve (12) months following
execution of this Lease; (ii) 10.65%, if the Expansion
Amendment is signed during the second twelve (12) months
following the execution of this Lease; and (iii) 10.8%, if
the Expansion Amendment is signed after the first
twenty-four (24) months following the execution of this
Lease; and (e) the rent for the Expansion and Expansion Area
will increase by 4.75% every thirty (30) months thereafter,
including the renewal terms if Tenant exercises its option
with respect thereto.
32. PURCHASE AND LEASE OF SOUTHERN LAND. Landlord has disclosed to Tenant that
the owner of the land consisting of approximately two (2) acres located adjacent
to and south of the Land (the "Southern Land"), may offer to sell the same to
Landlord. Landlord agrees to immediately deliver to Tenant a copy of any
correspondence received by Landlord concerning the Southern Land and to keep
Tenant informed of any communications Landlord has concerning the availability
or sale of the Southern Land. If the Southern Land becomes available for
purchase within one (1) year after the Commencement Date, and if the purchase
price which the owner thereof is willing to accept does not exceed $100,000,
then Landlord will, upon written notice from Tenant instructing Landlord to do
so, purchase the Southern Land for the price set forth in Tenant's notice. Upon
delivery of such notice, the parties will enter into an amendment to this Lease
that (a) adds the Southern Land to the Land demised hereunder as of the date of
Landlord's acquisition of title thereto; and (b) as of such acquisition date,
increases the monthly rent payable hereunder during the remainder of the initial
ten (10) year term by an amount sufficient to amortize Landlord's out-of-pocket
cost of acquiring the Southern Land over such period, together with interest
thereon at the rate of eleven percent (11%) per annum.
EXECUTED as of March 16, 2000.
LANDLORD: TENANT:
DOVE VALLEY BUSINESS CENTER, LLLP KOALA CORPORATION
BY: /s/ Xxxx X. Xxxxxxxxx BY: /s/ Xxxx X. Xxxxxx
---------------------------- ------------------------------------
NAME: Xxxx X. Xxxxxxxxx NAME: Xxxx X. Xxxxxx
---------------------------- ------------------------------------
TITLE: General Partner TITLE: Chairman and Chief Executive Officer
Initials: __________ __________
Landlord Tenant
16
EXHIBIT "A"
Legal Description of the Land
Approximately 6.936 acres of land located at South Wheeling Court on Xxx 00 &
Xxx 00 xx xxx Xxxx Xxxxxx Business Park in Arapahoe County, Colorado, as
depicted on the Preliminary Plans.
Initials: __________ __________
Landlord Tenant
A-1
EXHIBIT "B"
Preliminary Plans
The Preliminary Plans consist of the specifications set forth below and the
following-described plans: Five (5) plan sheets entitled "Koala Dove Valley
Business Center" and prepared by Xxxxxx Xxxxxx, consisting of (1) floor plan
dated 9/22/99; (2) enlarged floor plan dated 9/22/99; (3) site plan dated
1/24/00; (4) landscape plan dated 1/24/00; and (5) elevations dated 1/19/00.
The following are the construction specifications for the office/warehouse
building to be constructed for the Tenant. Industrial buildings may vary in some
details as indicated on the specific working drawings. The Landlord reserves the
right to change these specifications with written notice and Tenant approval.
PROJECT DATA:
------------
1.01 Land Area: Approximately 6.936 acres
1.02 Building Size:
Office 15,000 square feet
Mezzanine 15,000 square feet (unfinished above office)
Warehouse 99,000 square feet
------------------------------------
TOTAL 129,000 square feet
1.03 Clear Height: 2 4' clear minimum to bottom bar joists.
1.04 Building Description: Conventionally framed building structural system
utilizing tube columns, open web joists and girders, metal roof deck,
and site cast concrete tilt wall panels. Roof system shall be modified
bitumen roof including all cants and base flashings over rigid
insulation on 22 gauge painted, rolled metal deck. All site
improvements, such as sidewalks, auto and truck parking are as shown on
the accompanying schematic site plan.
GENERAL REQUIREMENTS:
--------------------
1.05 Construction shall meet all applicable building codes, ordinances,
rules and regulations of the County of Arapahoe, and restrictive
covenants of the Dove Valley Business Park.
SITEWORK:
2.01 Pavement:
A. Asphalt paving to be installed in accordance with soil and civil
engineering design.
B. Concrete paving to be 6" thick, 4000 PSI, and otherwise per soil
engineer's recommendations.
C. Expansion joints located per soil engineer's recommendations. All
joints to be sealed with hot pour sealant.
2.02 Miscellaneous Site
A. 4" steel painted pipe bollards 42" above pavement and set 2'-6"
below pavement.
B. Striping to be 4" yellow or white to divide parking spaces.
Handicap symbols and signs to meet ADA requirements.
C. Pipe rails at exterior stairs and ramps to be 1-1/2 steel pipe
red oxide primed and painted in compliance with ADA.
D. Dock bumpers, 2 each per overhead door opening standard rubber
tread type. (Approximately 14" x 10" in size).
Initials: __________ __________
Landlord Tenant
B-1
2.04 Site Walks
All sidewalks to be 4" thick with 3000 PSI concrete and wire mesh
reinforcing. Finish to be light broom finish.
2.05 Testing
All soil and material testing will be done by an independent testing
lab, cost of which is included in proposal.
2.06 Landscape and Irrigation
Complete landscaping and automatic irrigation system to meet all
Arapahoe County and deed requirements.
FOUNDATION:
3.01 Structural Foundation
A. Drilled Piers
Reinforced concrete drilled piers, sized and excavated to
proper bearing strata in accordance with recommendations of
soil investigation report.
B. Slab on Grade
Building slab on 6" thick concrete with 4000 PSI concrete and
reinforcing per structural engineer's recommendations. Control
joints or construction joints to be located at column grid
lines and at mid points of all bays.
3.02 Miscellaneous Foundation
Stair pans to be concrete filled at an interior stair.
STRUCTURES:
4.01 Slab on Metal Deck Concrete
Mezzanine floor slab shall be 3" concrete on galvanized steel deck with
wire mesh, 6 x 6 - W4 x W4 weld flat sheet.
4.02 Structural Steel
A. Structural steel system to be conventional design with round or
tubular columns, I-beams and bar joists to support the main
structure of the building. Mezzanine floor structural system is
based on columns, beams and bar joist systems. All tilt-wall
panel embeds, miscellaneous angle supports have been included.
B. The color of all Structural Steel shall be manufacturer's xxxx.
4.03 Exterior Walls
A. Tilt-wall panels based on a minimum 7" thick smooth panels with
Painted exterior finish.
B. Reinforcing at wall panels will be a minimum of #4 at 12" O.C. as
designed by structural engineer.
ENCLOSURES:
5.01 Modified Bitumen Roof
A. TAMKO modified bitumen roof system including all cants and base
flashings over ridged insulation on 22 gauge painted, rolled
metal deck. Color of deck shall be manufacturer's white.
Initials: __________ __________
Landlord Tenant
B-2
B. Furnish twelve (12) year full value manufacturer's warranty on
roofing system (labor and material).
C. Coping, downspouts, collector heads and scuppers will be
galvanized.
D. Steel downspout guards will be provided as required on
downspouts.
5.02 Caulk and Waterproofing
A. Caulking of tilt-wall panels with xxxxxx xxx sealants.
B. Caulking of roofing, glazing related items - by the individual
trades.
5.03 Roof Blocking
A. All roof blocking at perimeter of building to be pressure treated
material.
5.04 Glass and Glazing, Entry Doors and Framing
A. One (1) double 6' x 7' medium style Clear Aluminum storefront
doors with related hardware and weather-stripping.
B. Storefront frame system to be clear anodized 1-3/4 x 4" with
tinted Xxxx Insulated Glass.
C. Interior Glazing: 1/4" thick clear. (if required.)
5.05 Paint
Exterior painting consist of the tilt-wall panels around the building,
pipe bollard, pipe rails, and exterior hollow metal doors and frames.
Tilt-wall panel will be of highest quality elastomeric finish system.
5.06 Exterior Hollow Metal Doors and Frames
Based on 14 gauge frames and 16 gauge doors galvanized.
5.07 Threshold & Weather-Stripping/Finish Hardware
A. All exterior doors to receive aluminum threshold and
weather-stripping.
B. Finish hardware at personnel doors to receive cylinder passage
set, dead bolt, closure and panic alarms as required by code.
5.08 Building Insulation
A. R-19 Insulation at the roof deck.
B. Sound xxxxx located at restroom walls and ceilings.
C. All perimeter walls of the office area, etc. to be insulated with
3-1/2" unfaced batt insulation to achieve a thermal envelope
around the A/C areas.
5.09 Overhead Sectional Doors
8' x 9' and 10' x 14' insulated sectional doors, 24 gauge steel. Doors
will have a weather seal across the bottom of the door and equipped
with side lock. Manual operated.
Initials: __________ __________
Landlord Tenant
B-3
INTERIOR FINISHES:
-----------------
6.01 Drywall Partitions
A. Exterior perimeter walls - 2-1/2" 25 gauge metal studs 16" O.C.,
from floor to deck, one layer 5/8" gypsum board on one side, batt
insulation from floor to ceiling, tape, float and prepare for
finishes scheduled.
B. Interior walls - 2-1/2" 25 gauge metal studs 16" O.C., from floor
to ceiling one layer 5/8" gypsum board on each side, tape, float
and prepare for finishes scheduled each side. A sound attenuation
blanket is to be provided in between the gypsum board.
C. Provide full height separation walls to separate production and
warehouse areas from the office.
6.02 Door Units
A. Interior - full height flush 3' x 9' x 1-3/4", plastic laminate
solid core doors, with brushed aluminum finish hardware, lever
handle, cylindrical passage latches and hinges, closers at
restrooms, wall stops at all doors, in pre-finished aluminum
frames by "Raco" or equal.
B. Exterior - flush door 3' x 7' x 1-3/4", galvanized hollow metal
door 18 gauge, with brush aluminum finish hardware, cylindrical
keyed lockset, closer, weather-stripping, in hollow metal frame,
galvanized 16 gauge.
6.03 Resilient Floor
Vinyl composition tile will be 12" x 12" x 1/8" equal to Azrock
Architectural Series.
6.04 Carpet
Carpeting shall be level looped Olefin/Nylon, 28 oz. pile weight,
ActionBac, direct glue down.
6.05 Wall Base
Rubber base, 4" high with topset cove. Location - Areas scheduled to
receive resilient floor and carpet.
6.06 Painting
A. Painted drywall surfaces shall be covered with one coat of primer
and two finish coats of flat latex equal to Pittsburg Paint's,
with a smooth finish. Ferrous metal shall be covered with two
coats semi-gloss enamel finish over primer, with tool dry film
thickness not less than 2.5 mils.
B. Location Drywall - office areas only.
6.07 Acoustical Ceiling
A. Ceilings shall be equal to Xxxxxxxxx Class "A" 2' x 4' Cortega
fissured lay-in tiles laid into an exposed pre-finished white
T-bar 15/16" suspension grid.
B. Location - office area.
6.08 Millwork
A. Lavatory counter at restrooms, 3/4": plywood substrates, plastic
laminate finish, 4" high back and side splashes.
B. Base and upper cabinets to be plastic laminate exterior with
white melamine interior finish, (standard colors by Xxxxxx-Art.)
Initials: __________ __________
Landlord Tenant
B-4
DOCK EQUIPMENT:
--------------
7.01 Dock Levelers
SERCO "W" Series, Mechanical pit style dock levelers, standard capacity
(25,000 lbs.). High tensile 50,000 p.s.i. deck, lip plat and beams.
Torsionally capable box beams; unlimited float Posi-Trac hold-down.
SPECIALTIES:
9.03 Toilet room accessories equal to Xxxxxxx.
9.04 Fire Extinguisher
Fire extinguisher equal to X.X. Industries #1015-FIL with 10 lb. fire
extinguisher multi-purpose.
FIRE PROTECTION SPRINKLER SYSTEM:
--------------------------------
10.01 A. Provide fire department connections at exterior points per local
requirements.
B. A Class IV wet, ESFR sprinkler system will be installed.
C. Chrome pendant heads with chrome escutcheon in finished spaces,
brass upright heads in unfinished areas.
HVAC:
11.01 A. Provisions for roof mounted fans are included to provided make
up air at four (4) air changes per hour. Heaters and package roof
top air conditioning units and associated gas piping shall be
part of Tenant Improvements.
B. Materials: The following equipment manufacturers shall be
utilized.
Roof Top Units - Carrier, Trane, Lennox or equal.
Heating Units - Cambridge or equal
ELECTRICAL:
12.01 Power Distribution: Provide a complete building power distribution
system from a utility furnished 480/277V, 3 phase service.
LIGHTING:
13.01 A. Office fixture shall be 2' x 4', fluorescent lay in troffers with
acrylic lenses.
B. Warehouse/manufacturing area shall be 400W metal halide fixtures
to maintain 30 f.c. on average in the warehouse. Light fixtures
are to be mounted to the bottom of the joist. All fixture will be
provided initially with lamps and ballasts as required to meet
energy code requirements.
C. Parking: Auto areas will have metal halide wall mounted fixtures.
Initials: __________ __________
Landlord Tenant
B-5
