Exhibit 10.61
TERMINATION AND SETTLEMENT AGREEMENT
This Termination and Settlement Agreement ("Agreement") is entered into as
of this 8th day of April, 2003 by and between A.H. Root, Limited Liability,
("Landlord"), and Integrated Information Systems, Inc., a Delaware corporation
("Tenant"), in consideration of the mutual covenants contained herein and the
benefits to be derived therefrom.
WITNESSETH:
WHEREAS, Tenant and Landlord entered into an assignment and assumption of
a certain Lease (the "Lease") dated August 14, 1999 on November 15, 2001,
pursuant to which Landlord leased to Tenant certain premises containing
approximately 5,830 square feet of space on the third (3rd) floor of a certain
building located at 0000 Xxxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxx; and
WHEREAS, Tenant desires to terminate the term of the Lease prior to the
scheduled expiration date thereof; and
WHEREAS, Landlord is willing to terminate the term of the Lease prior to
the scheduled expiration date thereof, subject to the terms and conditions
hereinafter set forth;
NOW THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Landlord and the Tenant agree
as follows:
1. Defined Terms.
Any capitalized terms used but not defined in this Agreement shall have
the meaning assigned to them in the Lease.
2. Termination of Term of Lease.
Subject to Third Party Settlements having been obtained, Tenant's
performance of its Surrender Obligations and Tenant's conveyance of Personal
Property to Landlord, the Lease Term shall be terminated effective as of the
later of (a) the date of Landlord's execution and delivery of this Agreement to
Tenant, and (b) the date of Tenant's execution and delivery to Landlord of the
Xxxx of Sale, together with possession of the Personal Property (each as
hereinafter defined) (the date on which the later of the foregoing (a) and (b)
occurs is hereinafter, the "Effective Termination Date").
3. Application of Portion of Security Deposit Against Amounts Due Through
Effective Termination Date.
On the Effective Termination Date, Landlord shall apply the remaining
Security Deposit against any and all amounts due under the Lease through the
Effective Termination Date.
4. Landlord's Damages; Settlement Amount.
In consideration of the early termination of the Lease, Tenant shall: (a)
convey Tenant's Personal Property to Landlord pursuant to Section 5, below; and
(b) any Security Deposit not previously applied by Landlord (collectively, the
"Settlement Amount") prior to the date hereof
or as provided in Section 3 hereof (to be satisfied by Landlord retaining such
amount and having no obligation to return any portion of the Security Deposit to
Tenant, with the date of conveyance of such portion of the Settlement Amount to
be deemed the date of payment of the Settlement Amount).
5. Tenant's Conveyance of Personal Property to Landlord.
In consideration of the early termination of the Lease, Tenant shall
transfer, sell, assign and convey to Landlord all of the furniture, systems,
equipment and other personal property listed on Exhibit A attached hereto,
(collectively, the "Personal Property"), and in furtherance thereof, Tenant
shall contemporaneously with the execution and delivery of this Agreement
execute and deliver to Landlord a xxxx of sale with respect to the Personal
Property in the form attached hereto as Exhibit B (the "Xxxx of Sale"). Tenant
hereby represents and warrants to Landlord that the Personal Property is being
delivered in "as is" condition to the Landlord; that, subject to the Third Party
Settlements, which shall be released contemporaneously with the execution of
this document by Landlord in the form attached hereto as Exhibit C, Tenant, is
the lawful owner of the Personal Property; that Tenant has made no prior sale,
assignment, conveyance or transfer of any right, title or interest in any of the
Personal Property or granted or suffered any restriction, lien or encumbrance
therein or thereon; that Tenant has paid for all of the Personal Property in
full and that none of the Personal Property is subject to any purchase money
security interest, or any other lien or security interest of any kind or nature,
except those that are waived as provided in the Third Party Settlements in
Exhibit C attached hereto; and that Tenant hereby warrants title to the Personal
Property and will defend the same against the lawful claims of all persons
whomsoever.
6. Third Party Settlements.
Conveyance of the Settlement Amount is subject to the Tenant's settlement
of a certain equipment and furniture lease with BSB Leasing, Inc. (the "Third
Party Settlements"). Such Third Party Settlements have been negotiated and will
be closed prior to or contemporaneously with the signing of this Agreement. The
substance and form of such Third Party Settlements are attached as Exhibit C.
7. Surrender Obligations.
On or prior to the Effective Termination Date, the Tenant shall surrender
the Premises to the Landlord with the Personal Property, but otherwise vacant
and in broom clean condition and otherwise in compliance with the terms and
conditions of the Lease (collectively, the "Surrender Obligations"). Tenant has
removed certain items of Tenant's personal property, and all remaining personal
property of Tenant at the Premises is hereby conveyed to Landlord.
8. Operating Expenses and Taxes.
Tenant shall have no further liability for Operating Expenses and Property
Taxes, and Landlord shall have no obligation to refund any overpayment of
Operating Expenses or Property Taxes to Tenant.
9. Release.
Tenant, for itself, its legal successors and assigns, its agents, servants
and employees, and each of them, does hereby release and forever discharge the
Landlord, and their respective legal
2
successors and assigns, shareholders, partners, agents, servants and employees
(all of the foregoing, collectively, the "Landlord Parties"), of and from any
and all claims, demands, damages, debts, liabilities, actions, and causes of
action of every kind and nature whatsoever, whether now known or unknown, which
Tenant ever had, now has or hereafter may have against the Landlord Parties or
any of them, arising out of, based in whole or in part upon, or relating to, any
act, omission, event, matter or thing occurring at any time up to the date of
this Agreement; provided, however, that nothing in this Agreement is intended to
release Landlord from its obligations to be performed hereafter under the Lease
prior to the Effective Termination Date.
10. Lease Still in Effect.
Except as modified hereby, all terms and conditions of the Lease shall
remain in full force and effect until the Effective Termination Date, after
which date neither Landlord nor Tenant shall have any further obligations to
each other under the Lease, except for any provisions which by their terms
survive the expiration or prior termination of the Lease Term.
11. Delivery of Draft of this Agreement Not an Offer.
The submission of this Termination and Settlement Agreement in a draft
form to Tenant or its agent does not constitute an offer to Tenant to enter into
this Agreement. This Termination and Settlement Agreement shall have no force or
effect until: (a) it is executed and delivered by Tenant to Landlord; and (b) it
is executed and delivered by Landlord to Tenant.
12. Entire Agreement.
This Termination and Settlement Agreement represents the entire
understanding of the parties hereto with respect to the subject matter hereof
and there are no understandings or agreements between Landlord or Tenant
relating to the Lease or the Premises not set forth herein. No party has relied
on any representation, warranty, or understanding not set forth herein, wither
oral or written, as an inducement to enter into this Agreement.
13. Governing Law.
This Agreement shall be governed by and construed in accordance with the
laws of the State of Colorado and is intended to take effect as a sealed
instrument. Each party hereto submits to the jurisdiction of the courts of the
State of Colorado for all purposes related to this Agreement.
3
EXECUTED as of the date first above written.
TENANT:
Integrated Information Systems, Inc.
By:/s/ /Xxxxxx X. Xxxxxxx
-----------------------------------------
Name: Xxx Xxxxxxx
Title: SVP & CFO
--------------------------------------
Duly Authorized
LANDLORD:
A.H. Root Limited Liability Company
By: /s/ Xxxxxxx X. Xxxxxx
-----------------------------------
Name: Xxxxxxx X. Xxxxxx
--------------------------------
Title: Managing Member
--------------------------------
Duly Authorized
4
TENANT ACKNOWLEDGEMENT
State of Oregon )
) ss.
County of Multnomah )
On this 11th day of April, 2003, before me, a Notary Public in and for the
State of Arizona personally appeared Xxxxxx Xxxxxxx, the tenant of Integrated
Information Systems, Inc., the Delaware corporation that executed the within and
foregoing instrument, and acknowledged said instrument to be the free and
voluntary act and deed of said corporation, for the uses and purposes therein
mentioned, and on oath stated that she/he was authorized to execute said
instrument.
In Witness Whereof, I have hereunto set my hand and affixed my official
seal the day and year first above written.
Name: /s/ Xxxxxxxx Xxxxxxxx
--------------------------------------
NOTARY PUBLIC in and for State of
Arizona, residing at Portland
---------------------
My appointment expires: October 11, 2005
------------------
[NOTARIAL SEAL]
5
LANDLORD ACKNOWLEDGEMENT
State of Colorado )
) ss.
)
On this 11th day of April, 2003, before me personally appeared Xxxxxxx X.
Xxxxxx, to me known to be a Managing Member of A.H. Root Limited Liability
Company and acknowledged said instrument to be the free and voluntary act and
deed of A.H. Root Limited Liability Company, for the uses and purposes therein
mentioned, and on oath stated that he was authorized to execute said instrument.
In Witness Whereof, I have hereunto set my hand and affixed my official
seal the day and year first above written.
Name: /s/ Xxxx X. Xxxxx
------------------------------------
NOTARY PUBLIC in and for the State of
Colorado, residing at 0000 X. 00xx
---------------
Xxxxxx, Xxxxx Xxxxx, Xxxxxxxx
------------------------------------------
My appointment expires: 10/28/06
------------------
6
Exhibit A
Description of Personal Property
A representative of the management team of Assignor was on the leased premises
during the week of March 3 - 7, 2003. The following list of personal property is
based on that representative's observations at that time. While Assignor
believes that the list is, in the aggregate, materially accurate, Assignor does
not warrant that each item is on still on the leased premises. Assignor agrees
not to remove any additional personal property from the leased premises, and
Assignee agrees not to bring a claim or avoid the related settlement of claims
between Assignor and Assignee for any item or set of items which, individually
or in the aggregate, account for less than 15% of the fair market value of the
personal property, in the aggregate.
ONE LARGE CONFERENCE ROOM TABLE.
30 ALERION CHAIRS (SIC)
ONE ELECTRONIC PROJECTOR AND SCREEN
ONE WHITE EASLE
ONE PROJECTOR CABINET
EIGHTEEN GREY STEEL CUBES
EIGHT BLUE FABRIC CHAIRS
FOUR BLACK WORK STATIONS
THREE-PIECE RECEPTION FURNITURE
TWO RECEPTION TABLES
ONE RECEPTION LAMP
TWO EXECUTIVE OFFICE FURNITURE SYSTEMS COMPLETE
FOUR FILE CABINETS IN MIDDLE OFFICE
TWO BLUE CUSHONED CHAIRS
SIX GREY STEEL TABLES (MATCHES THE AFOREMENTIONED CUBES)
ONE ROUND TABLE WITH TWO BLUE CHAIRS
COMPUTER RACKS IN COMPUTER FILE SERVER ROOM
KITCHEN TABLE WITH FIVE CHAIRS
BLACK REFRIGERATOR
ALL KITCHEN APPLIANCES AS ARE PRESENT ON THE EXECUTION OF THE SETTLEMENT
AGREEMENT
SIX BLACK SIDE CHAIRS
SEVEN TRIANGLE TABLES
ONE LaserJet 8100 DN PRINTER
ONE XEROX COPY MACHINE
ONE BROTHER FAX MACHINE
ONE PAPER SHREADER
7
TWO BLACK LATERAL FILE CABINETS
ALL TRASHCANS AND CHAIR PADS AS ARE PRESENT ON THE EXECUTION OF THE SETTLEMENT
AGREEMENT
FOUR CLOCKS MOUNTED ON WALL
NINE BLACK UNDERCOUNTER FILE CABINETS
A TELEPHONE SYSTEM AND ASSOCIATED HANDSETS TWO CISCO ROUTERS
Other Tenant Personal Property that is left in the Premises, as Defined in this
Settlement Agreement, as of the date of the signing of the Settlement Agreement
is also conveyed in the Xxxx of Sale.
8
Exhibit B
XXXX OF SALE
This Xxxx of Sale ("Xxxx of Sale") made and entered into as of this 8th
day of April, 2003, by and between by and between Integrated Information
Systems, Inc., a Delaware corporation ("Assignor"), and A.H. Root, Limited
Liability Company ("Assignee").
W I T N E S S E T H:
WHEREAS, Tenant and Landlord entered into an assignment and assumption of
a certain Lease (the "Lease") dated August 14, 1999 on November 15, 2001,
pursuant to which Landlord leased to Tenant certain premises containing
approximately 5,830 square feet of space on the third (3rd) floor of a certain
building located at 0000 Xxxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxx; and
WHEREAS, Assignor desires to terminate the Lease prior to the expiration
of the term thereof, and Assignee is willing to terminate the Lease, subject to
and in accordance with the provisions of a certain Termination and Settlement
Agreement of even date herewith (the "Settlement Agreement").
WHEREAS, as a condition to Assignee's agreement to execute and deliver the
Settlement Agreement, Assignor is required to bargain, sell, assign, transfer
and convey to Assignee all of Assignor's right, title and interest in and to the
Personal Property (as hereinafter defined).
NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein, the receipt and sufficiency of which are hereby acknowledged,
the parties hereto do hereby agree as follows:
1. Assignor hereby grants, sells, assigns, transfers, conveys and delivers
to Assignee, and Assignee does hereby purchase, acquire and accept, all right,
title, and interest of Assignor in, to and under the Personal Property. As used
herein, the term "Personal Property" shall mean all of the furniture, systems,
equipment and other personal property listed on Exhibit A attached hereto and
incorporated herein by reference, and any and all warranties and guaranties made
to or in favor of the Assignor, or in which Assignor has any rights or
interests, directly or indirectly, with respect to the Personal Property.
TO HAVE AND TO HOLD all of the Personal Property unto the Assignee, its
successors and assigns, for its own use and behalf forever.
2. Assignor does hereby make, constitute and appoint Assignee, or any
officer or agent designated by Assignee, Assignor's true and lawful
attorney-in-fact, with power of substitution, to enforce every such contract,
permit, license, claim, demand or right, to collect the moneys which become due
and payable at any time on or after the date hereof under such contract and in
respect of every such claim, demand or right; hereby granting unto Assignor's
said attorney full power to do any and all things necessary to be done in and
about the premises as fully and effectually as Assignor might or could do, and
hereby ratifying all that said attorney shall do or cause to be done by virtue
hereof. This power of attorney, being coupled with an interest, shall be
irrevocable.
9
3. It is the intention of the Assignor to irrevocably transfer the
absolute right, title and interest in and to the Personal Property to the
Assignee.
4. Assignor covenants and agrees with Assignee that Assignor is and shall
remain responsible for and agree to perform, discharge, fulfill and observe all
obligations, covenants, conditions and provisions first accruing or arising or
required prior to the date hereof with respect to the Personal Property.
Assignor hereby indemnifies and agrees to defend (with counsel reasonably
satisfactory to Assignee) and hold Assignee harmless from and against any loss,
cost, expense, damage, claim, action, cause of action, suit or other liability
asserted against Assignee (i) arising out of, or based upon, Assignor's failure
to perform, discharge, fulfill and observe all obligations, covenants,
conditions and provisions first accruing or arising or required prior to the
date hereof with respect to the Personal Property, or (ii) resulting from any
inaccuracy or misrepresentation of any of the representations and warranties of
Assignor herein.
5. Assignor represents and warrants that:
Subject to the Third Party Settlements as defined in the Settlement
Agreement, it has the full corporate power and authority to execute and deliver
this Xxxx of Sale and to consummate the transactions hereby effected, that the
execution, delivery and consummation of this Xxxx of Sale have been duly
authorized by all corporate action on the part of Assignor and that this Xxxx of
Sale is the valid and binding obligation of Assignor, enforceable against
Assignor in accordance with its terms.
Subject to the Third Party Settlements as defined in the Settlement
Agreement, Assignor is the lawful owner of the Personal Property; Assignor has
made no prior sale, assignment, conveyance or transfer of any right, title or
interest in any of the Personal Property or granted or suffered any restriction,
lien or encumbrance therein or thereon; Assignor has paid for all of the
Personal Property in full and none of the Personal Property is subject to any
purchase money security interests, or other security interests, liens or claims
of any kind or nature; and Assignor hereby warrants title to the Personal
Property and will defend the same against the lawful claims of all persons
whomsoever.
All representations, warranties, indemnifications and agreements
herein shall survive the delivery and acceptance of the Personal Property and
this Xxxx of Sale.
6. From time to time after the date hereof, at Assignee's request and
without further consideration from Assignee, Assignor agrees to execute and
deliver such other instruments of conveyance and transfer and to take such other
action as Assignee may reasonably require to more effectively convey, transfer
to and vest in Assignee all of the Personal Property. Without limiting the
generality of the foregoing, Assignor covenants and agrees that from time to
time at the request of Assignee and without further consideration, it will
execute, deliver, acknowledge (or cause to be executed, delivered and
acknowledged), all such other instruments, documents and agreements and take, do
and perform all such other acts as may reasonably be required in order to vest
in and confirm to Assignee the title of Assignor to, and its right to use and
enjoy, the Personal Property hereby agreed to be and intended to be conveyed to
Assignee.
7. This Xxxx of Sale together with the Termination and Settlement
Agreement constitutes the entire agreement between the parties in connection
with the Personal Property and may be amended only by a writing signed by an
authorized representative of each party. This Xxxx of Sale may be executed in
two or more counterparts, each of which shall be deemed an original, but all of
which together will constitute one and the same instrument. This Xxxx of Sale
shall be binding upon and shall inure to the benefit of the parties hereto and
their respective
10
successors and assigns. This Xxxx of Sale shall be governed by and construed in
accordance with the laws of the State of Colorado.
8. If Assignee shall have any cause of action or other claim against any
Assignor arising from or by reason of any matter or thing concerning this Xxxx
of Sale or the subject matter hereof, including, without limitation, (i) any
misrepresentation or breach of any warranty or representation contained in this
Xxxx of Sale or in any document executed in connection herewith or (ii) any
breach of any covenant or agreement made or to be performed by Assignor under or
pursuant to this Xxxx of Sale or any document executed in connection herewith,
then without limitation as to any damages for which Assignor may be liable in
connection therewith, Assignor shall be liable to Assignee for, and shall pay to
Assignee on demand, all reasonable attorneys' fees and expenses incurred by
Assignee in connection with the successful enforcement of its rights and
remedies hereunder, whether or not a suit or other action or arbitration is
brought or instituted.
IN WITNESS WHEREOF, the parties hereto have caused this Xxxx of Sale to be
duly executed as an instrument under seal the day and year first set forth
above.
Assignor:
Integrated Information Systems, Inc.
By: /s/Xxxxxx X. Xxxxxxx
---------------------------------
Name: Xxx Xxxxxxx
Title: SVP & CFO
------------------------------
Duly Authorized
Assignee:
A.H. Root Limited Liability Company
By: /s/ Xxxxxxx X. Xxxxxx
---------------------------------
Name: Xxxxxxx X. Xxxxxx
------------------------
Title: Managing Member
Duly Authorized
11
Exhibit C
Third Party Settlements
12
