Exhibit 10.7
INDUSTRIAL LEASE
THIS LEASE is made this 21st day of July, 2004, by and between WDCI, INC., a
Hawaii corporation ("Landlord") and Rubicon Medical Inc., a Utah corporation
("Tenant"):
1. BASIC TERMS.
1.01 Basic Terms.
(A) Landlord: WDCI, INC., a Hawaii corporation.
(B) Tenant: Rubicon Medical, Inc., a Utah corporation.
(C) Address of Tenant: 0000 Xxxx 0000 Xxxxx, Xxxx Xxxx
Xxxx, Xxxx 00000
(D) Premises: Space in the industrial building located at
0000 Xxxx 0000 Xxxxx, Xxxx Xxxx Xxxx, Xxxx, which
Premises are outlined on Exhibit A attached hereto
for the purposes of identification.
(E) Building: The Building in which the Premises are
located.
(F) Project: A warehouse complex including all
improvements and appurtenances thereto known as
"Centennial Plaza" and located in Salt Lake City,
Utah, such complex depicted and described on Exhibit
A attached hereto.
(G) Lease Term: Twenty Four (24) months.
(H) Rent: All sums, moneys, or payments are required to
be paid by Tenant to Landlord pursuant to the terms
of this Lease, including Sections 5, 21.01, 21.02,
and 21.03.
(I) Base Rent: Base Rent shall be in accordance with the
following schedule:
Months Monthly Base Rent
------ -----------------
1 - 12 $9,675.00
13 - 24 $10,295.00
(J) Security Deposit: $10,295.00
(K) Tenant's Proportionate Share: 12.90%.
(L) Estimated Initial Monthly Common Expenses: $1,365.00
(M) Estimated Initial Monthly Real Estate Tax Charge:
$1,181.25
(N) Permitted Use: Office and General Manufacturing.
1.02 Effect of Reference to Basic Terms. Effect of Reference to Basic Terms.
Each reference in this Lease to any of the Basic Terms contained in
Section 1.01 shall be construed to incorporate into such reference the
respective definition for such Basic Term set forth in Section 1.01
above.
2. PREMISES.
2.01 Lease. In consideration of the rents, covenants, agreements, and
conditions hereinafter provided to be paid, kept, performed, and
observed, Landlord leases to Tenant and Tenant hereby hires from
Landlord the Premises described in Section 1.01D.
2.02 Reservations by Landlord. Landlord excepts and reserves the roof and
exterior walls of the Building, and further reserves the right to
place, install, maintain, carry through, repair, and replace such
utility lines, pipes, wires, appliances, tunneling, and the like in,
over, through, and upon the Premises as may be reasonably necessary or
advisable for the servicing of the Premises or any other portions of
the Project.
Notwithstanding any provision in this Lease to the contrary, it is agreed that
Landlord reserves the right, without invalidating this Lease or modifying any
provision thereof, at any time, and from time to time, (i) to make alterations
changes, and additions to the Building and other improvements in the Project
(including, without limitation, the Building in which the Premises are located),
(ii) to add additional areas and buildings to the Project and/or to exclude
areas therefrom, (iii) to construct additional buildings and other improvements
in the Project, (iv) to remove or relocate the whole or any part of any building
or other improvement in the Project, and (v) to relocate any other tenant in the
Project. It is further understood that the existing layout of the buildings,
walks, roadways, parking areas, entrances, exits, and other improvements shall
not be deemed to be a warranty, representation, or agreement on the part of
Landlord that the Project shall remain exactly as presently built, it being
understood and agreed that Landlord may change the number, dimensions, and
locations of the walks, buildings, and parking spaces as Landlord shall deem
proper.
3. USE.
The Premises hereby leased shall be used by Tenant for the purpose specified in
Section 1.01N and for no other purposes. Landlord makes no representation to
Tenant that the use limited in this Section 3 constitutes a lawful use under
applicable zoning regulations, or that the lawful uses for the Premises as of
the date of this Lease shall not change during the Lease Term. Tenant shall, at
its own expense, comply promptly with all applicable statutes, ordinances,
rules, regulations, orders, and requirements in effect during the Term or any
part of the Term hereof regulating the use by Tenant or condition of the
Premises. Tenant shall not use or permit the use of the Premises in any manner
that will tend to create waste or a nuisance, or which will tend to unreasonably
disturb other tenants in the Project. Tenant shall not place a load upon the
floor of the Building which exceeds that load per square foot which such floor
was designed to carry or which is allowed by law. Tenant, its employees, and all
persons visiting or doing business with Tenant in the Premises shall be bound by
and shall observe the Rules and Regulations attached to this Lease as Exhibit B,
and such further and other reasonable Rules and Regulations made hereafter by
Landlord relating to the Project or the Premises, of which notice in writing
shall be given to Tenant, and all such Rules and Regulations shall be deemed to
be incorporated into and form a part of this Lease. Tenant shall be solely
responsible for providing security for the Premises, and for Tenant, its agents,
employees, contractors, customers, invitees, and others within the Premises.
Landlord shall have no responsibility therefor.
4. TERM.
4.01 Term of Lease. To have and to hold the leased Premises for and during
the Lease Term described in Section 1.01G, commencing on the
Commencement Date (defined in Section 4.02 below), subject to the
payment of the Rent and the full and timely performance by Tenant of
the covenants and conditions hereinafter set forth.
4.02 Commencement Date. As used in this Lease, the term "Commencement Date"
shall mean the date the Premises are Ready for Occupancy (as defined in
Section 4.04 below). If the Commencement Date occurs on other than the
first day of a month, Tenant shall pay Base Rent at the same monthly
rate for such partial month (also in advance), any periods for rent
adjustments shall be measured from the first day of the calendar month
in which the Commencement Date falls and all other terms and conditions
of this Lease shall be in force and effect during such partial month.
As soon as the Commencement Date is established Landlord and Tenant
shall execute a Commencement Date Memorandum in the form of attached
Exhibit C, which may be requested by either party, setting forth the
exact Commencement Date and the Expiration Date to provide for the full
term referenced in Section 1.01G from the Commencement Date.
Notwithstanding anything contained in this Section 4.02 to the
contrary, it is understood and agreed that at such time as Tenant
occupies all or any portion of the Premises for the purposes permitted
or allowed in this Lease, its Rental obligation shall commence.
4.03 Landlord's Work. Landlord agrees to perform the work described in
Exhibit D hereto ("Landlord's Work"). Other than Landlord's Work,
Landlord shall have no obligation for the completion or repair of the
Premises and Tenant shall accept the Premises in its "as is" condition
on the date Landlord delivers possession of the Premises to Tenant in
accordance with the provisions of this Lease.
4.04 Ready for Occupancy; Delay in Delivery. Landlord shall deliver and
Tenant shall accept possession of the Premises at such time as the
Premises is Ready for Occupancy. If the Premises, or any portion, is
not "Ready for Occupancy" on the Commencement Date, Rent and other sums
owing under this Lease attributable to the Premises shall not commence
until the Premises is Ready for Occupancy. The postponement of Rent and
other sums herein provided to be paid by Tenant attributable to such
space for any period prior to the delivery to Tenant of such space
Ready for Occupancy shall be in full settlement of all claims which
Tenant might otherwise have by reason of such space not being Ready for
Occupancy on the Commencement Date. "Ready for Occupancy" as used
herein shall mean the date that Landlord shall have substantially
completed Landlord's Work, subject only to the completion of "punch
list" items of a minor nature. The issuance of a temporary certificate
of occupancy for such space (or its equivalent), or certification by
Landlord's contractor, architect or space planner verifying substantial
completion of Landlord's Work shall conclusively control the date upon
which the space is Ready for Occupancy and the commencement of Tenant's
obligation to pay Rent. In the event Tenant's acts or omission delay
the completion of Landlord's Work, Landlord's Work shall be deemed
Ready for Occupancy on the date Landlord's Work would have been
substantially completed in the absence of Tenants acts or omission that
caused the delay. Notwithstanding anything in the foregoing to the
contrary, should Landlord fail to have the Premises Ready for Occupancy
within one hundred eighty (180) days after the date of this Lease (such
date extended if failure to have the Premises Ready for Occupancy is
due to Force Majeure, as referenced in Section 14), then Tenant shall
have the option to terminate this Lease upon written notice (which
shall be delivered if at all within fifteen (15) days after the date
Tenant is entitled to terminate the Lease pursuant to this Section and
if not timely delivered, then Tenant's termination right shall lapse),
the effective date of termination to be at least thirty (30) days after
the date of delivery of Tenant's notice; provided, however, should
Landlord have the Premises Ready for Occupancy prior to the date set
forth in Tenant's notice then such termination notice shall be of no
force and effect and this Lease shall continue in full force and effect
between the parties. In the event this Lease is terminated as provided
immediately above, then neither Landlord nor Tenant shall have any
claim or obligation to the other by reason of this Lease or the
termination thereof.
4.05 Early Possession. Tenant shall be permitted to enter the Premises after
the later of (i) full execution and delivery of this Lease or (ii) the
vacation of the Premises by the existing tenant, and prior to the
Commencement Date without the obligation for payment of rent for the
purpose of installing fixtures and equipment; provided that (a) Tenant
will not interfere with Landlord's construction of the Landlord's Work,
(b) Tenant first provides Landlord with all insurance required by the
terms of this Lease, and (c) all construction by Tenant shall be
performed in accordance with the terms of this Lease. Without limiting
any other provision of this Lease, Landlord shall not be responsible
for damages or loss to any work performed by Tenant or to Tenant's
personal property or the personal property of Tenant's contractor's,
employees or agents which occurs during such period of early access.
5. BASE RENT.
Tenant agrees to pay Landlord the Base Rent set out in Section 1.01I
for the full Term. The first full monthly installment of Base Rent shall be
payable upon the execution of this Lease by Tenant. Thereafter, each succeeding
monthly installment shall be due and payable on or before the first day of each
and every successive calendar month during the Term. In the event the Term of
this Lease ends on a date other than the last day of a month, the last monthly
payment of Base Rent shall be in a pro rata portion of the then applicable Base
Rent for such partial month based on the number of days in such partial month
prior to and including the last day of the Term of this Lease.
The Base Rent and all other Rent or other charges provided for herein
shall be paid to Landlord without deduction or offset, and in lawful money of
the United States of America to such persons and at such place as Landlord may
from time to time designate in writing. For purposes of rent adjustment under
the Lease, the number of months is measured from the first day of the calendar
month in which the Commencement Date falls. Landlord and Tenant agree for tax
reporting purposes that none of the Base Rent due in periods in which the Base
Rent is not being abated shall be allocated to any other period.
6. UTILITIES AND SERVICES.
Tenant shall contract in its own name and pay for all charges for
water, sewer, electricity, gas, fuel, telephone, trash hauling, and any other
services or utilities used in, servicing, or assessed against the Premises,
unless otherwise herein expressly provided.
7. QUIET ENJOYMENT.
Landlord covenants that Tenant, on paying the Rent herein provided, and
on keeping, performing, and observing the covenants, agreements, and conditions
herein required of Tenant, shall peaceably and quietly hold and enjoy the
Premises for the Term aforesaid, subject, however, to the terms of this Lease.
8. ASSIGNMENT AND SUBLETTING.
8.01 No Assignments. Except as expressly permitted in this paragraph, Tenant
shall not, without the prior written consent of Landlord, which
Landlord agrees will not unreasonably be withheld, assign or
hypothecate this Lease or any interest herein or sublet the Premises or
any part thereof, or permit the use of the Premises by any party other
than Tenant. Any of the foregoing acts without such consent shall be
void and shall, at the option of Landlord, terminate this Lease. This
Lease shall not, nor shall any interest herein, be assignable as to the
interest of Tenant by operation of law without the written consent of
Landlord, which consent shall not be unreasonably withheld. A transfer
of a majority interest or control of the stock or capital or member
interest of Tenant shall be deemed an assignment under this Lease
requiring Landlord's consent.
8.02 Limits on Subletting. No sublease shall be made without the prior
written consent of Landlord, which consent Landlord agrees will not
unreasonably be withheld. If at any time or from time to time during
the term of this Lease, Tenant desires to sublet all or any part of the
Premises, Tenant shall give notice to Landlord setting forth the terms
of the proposed subletting and the space so proposed to be sublet and
such additional information concerning the subtenant as Landlord may
request, including, without limitation, the name of the proposed
subtenant; the nature of the proposed subtenant's business to be
carried on in the Premises; the terms and provisions of the proposed
sublease and a copy of the proposed sublease form; and such financial
information, including financial statements, as Landlord reasonably may
request concerning the proposed subtenant. Landlord shall have the
option, exercisable by notice given to Tenant within ninety (90) days
after Tenant's notice is given, either to sublet from Tenant such space
at the rental and other terms set forth in Tenant's notice, or, if the
proposed subletting is for the entire Premises and for the substantial
balance of the Term of this Lease, to terminate this Lease. If Landlord
does not elect to terminate and has consented to such sublease, Tenant
shall be free to sublet such space to any third party subject to the
following conditions:
1. The sublease shall be on the same terms set forth in the
notice given to Landlord;
2. No sublease shall be valid and no sublessee shall take
possession of the Premises subleased until an executed
counterpart of such sublease has been delivered to Landlord;
3. No sublessee shall have a right further to sublet; and
4. One hundred percent (100%) of any sums or other economic
consideration received by Tenant as a result of such
subletting (excluding brokerage commissions amortized over the
term of the sublease and rental or other payments received by
Tenant which are attributable to the amortization of the costs
of leasehold improvements, other than building standard tenant
improvements, made by Tenant to the sublet portion of the
Premises) whether denominated as rentals under the sublease or
otherwise and which exceed, in the aggregate, the total sums
which Tenant is obligated to pay Landlord under this Lease
(prorated to reflect Tenant's obligation to pay rent under
this Lease allocable to that portion of the Premises subject
to such sublease) shall be payable to Landlord.
8.03 Permitted Assignment/Subletting. Notwithstanding the provisions of
Sections 8.01 and 8.02 above, Tenant may assign this Lease or sublet
the Premises or any portion thereof, without Landlord's consent and
without extending any option to Landlord, to any corporation which
controls, is controlled by or is under common control with Tenant, or
to any corporation resulting from the merger or consolidation with
Tenant or Tenant's Parent, or to any person or entity which acquires
all the stock or assets of Tenant or Tenant's Parent provided that said
assignee (i) assumes each and every obligation of Tenant under this
Lease and (ii) such assignee has a tangible net worth that equals or
exceeds Tenant's tangible net worth on the date of this Lease or on the
date of the transfer, whichever is greater.
8.04 Tenant Not Released. Regardless of Landlord's consent, no subletting or
assignment shall release Tenant of Tenant's obligations hereunder or
alter the primary liability of Tenant to pay the Rent and to perform
all other obligations to be performed by Tenant hereunder. The
acceptance of Rent by Landlord from any other person shall not be
deemed to be a waiver by Landlord of any provision hereof. Consent to
one assignment or subletting shall not be deemed consent to any
subsequent or different assignment or subletting. In the event of
default by any assignee of Tenant or any successor of Tenant in the
performance of any of the terms hereof, Landlord may proceed directly
against Tenant without the necessity of exhausting remedies against
such assignee or successor.
8.05 Attorney Fees. In the event Tenant shall assign or sublet the Premises
or request the consent of Landlord to any assignment or subletting or
if Tenant shall request the consent of Landlord for any act that Tenant
proposes to do, then Tenant shall pay Landlord's actual attorney fees
incurred in connection therewith.
9. DAMAGE OR DESTRUCTION.
9.01 Definitions.
"Premises Partial Damage" shall herein mean damage or
destruction to the Premises to the extent that the cost of repair is
less than fifty percent (50%) of the then replacement cost of the
Premises.
"Premises Building Partial Damage" shall herein mean damage or
destruction to the Building of which the Premises are a part to the
extent that the cost of repair is less than fifty percent (50%) of the
then replacement cost of such Building as a whole.
"Premises Total Destruction" shall herein mean damage or
destruction to the Premises to the extent that the cost of repair is
fifty percent (50%) or more of the then replacement cost of the
Premises.
"Premises Building Total Destruction" shall herein mean damage
or destruction to the Building of which the Premises are a part to the
extent that the cost of repair is fifty percent (50%) or more of the
then replacement cost of such Building as a whole.
"Insured Loss" shall herein mean damage or destruction which
was caused by an event required to be covered by insurance carried by
Landlord and the proceeds payable under such insurance policy are
sufficient to pay in full the cost to repair and restore such damage
and destruction.
9.02 Partial Damage - Insured Loss. Subject to the provisions of Section
9.04, 9.05, and 9.06 hereof, if at any time during the term of this
Lease there is damage which is an Insured Loss and which falls into the
classification of Premises Partial Damage or Premises Building Partial
Damage, then Landlord shall, at Landlord's expense, repair such damage,
but not Tenant's fixtures, equipment or tenant improvements unless the
same have become a part of the Premises pursuant to the terms of the
Lease as soon as reasonably practicable and this Lease shall continue
in full force and effect.
9.03 Partial Damage - Uninsured Loss. Subject to the provisions of Section
9.04, 9.05 and 9.06 below, if at any time during the term of this Lease
there is damage which is not an Insured Loss and which falls within the
classification of Premises Partial Damage or Premises Building Partial
Damage, unless caused by a negligent or willful act of Tenant (in which
event Tenant shall make the repairs at Tenant's expense), Landlord may
at Landlord's option either (i) repair such damage as soon as
reasonably possible at Landlord's expense, in which event this Lease
shall continue in full force and effect, or (ii) give written notice to
Tenant within thirty (30) days after the date of the occurrence of such
damage of Landlord's intention to cancel and terminate this Lease, as
of the date of the occurrence of such damage. In the event Landlord
elects to give such notice of Landlord's intention to cancel and
terminate this Lease, Tenant shall have the right within ten (10) days
after the receipt of such notice to give written notice to Landlord of
Tenant's intention to repair such damage at Tenant's expense, without
reimbursement from Landlord, in which event this Lease shall continue
in full force and effect, and Tenant shall proceed to make such repairs
as soon as reasonably possible. If Tenant does not give such notice
within such ten (10) day period this Lease shall be canceled and
terminated as of the date of the occurrence of such damage.
9.04 Total Destruction. If at any time during the term of this Lease there
is damage, whether or not an Insured Loss (including destruction
required by any authorized public authority), which falls into the
classification of Premises Total Destruction or Premises Building Total
Destruction, this Lease shall automatically terminate as of the date of
such total destruction.
9.05 Damage Near End of Term. If at any time during the last six (6) months
of the term of this Lease there is damage, whether or not an Insured
Loss, which falls within the classification of Premises Partial Damage,
Landlord may at Landlord's option cancel and terminate this Lease as of
the date of occurrence of such damage by giving written notice to
Tenant of Landlord's election to do so within thirty (30) days after
the date of occurrence of such damage.
9.06 Abatement of Rent; Tenant's Remedies. In the event of damage described
in Sections 9.02, or 9.03 hereof, and Landlord or Tenant repairs or
restores the Premises pursuant to the provisions of this Section 9, the
Rent payable hereunder for the period during which such damage, repair
or restoration continues shall be abated in proportion to the degree to
which Tenant's use of the Premises is impaired. Except for abatement of
Rent, if any, Tenant shall have no claim against Landlord for any
damage suffered by reason of any such damage, destruction, repair or
restoration. If Landlord shall be obligated to repair or restore the
Premises under the provisions of this Section 9 and shall not commence
such repair or restoration within thirty (30) days after such
obligations shall accrue, Tenant may, at Tenant's option, cancel and
terminate this Lease by giving Landlord written notice of Tenant's
election to do so at any time prior to the commencement of such repair
or restoration. In such event this Lease shall terminate as of the date
of such notice.
9.07 Termination - Advance Payments. Upon termination of this Lease pursuant
to this Section 9, an equitable adjustment shall be made concerning
advance rent and any advance payments made by Tenant to Landlord.
Landlord shall, in addition, return to Tenant so much of Tenant's
Security Deposit as has not theretofore been applied by Landlord.
9.08 Waiver. Landlord and Tenant waive the provisions of any statutes which
relate to termination of leases when leased property is destroyed and
agree that such event shall be governed by the terms of this Lease.
10. LANDLORD'S RIGHTS.
Landlord reserves the following rights:
1. To change the name of the Building or the Project without
notice or liability of Landlord to Tenant;
2. At any time during the last ninety (90) days of the Term of
this Lease or any renewal hereof or any part hereof, if during
or prior to that time, Tenant has vacated the Premises, to
decorate, remodel, repair, alter, or otherwise prepare the
Premises for occupancy;
3. To exhibit the Premises to others and to display "For Rent"
signs on the Premises during the last ninety (90) days of the
Term of this Lease or any renewal hereof;
4. To remove from the parking lot abandoned or unlicensed
vehicles and vehicles that are unreasonably interfering with
the use of said parking lot by others and to charge the
responsible tenant for the expense of removing said vehicles;
and
5. To take any and all measures, including making inspections,
repairs, alterations, additions, and improvements to the
Premises or Project as may be necessary or desirable for the
safety, protection, or preservation of the Premises or the
Project or Landlord's interests, or as may be necessary or
desirable in the operation of the Premises or the Project.
Landlord may enter upon the Premises for the purpose of exercising any or all of
the foregoing rights hereby reserved without being deemed guilty of an eviction
or disturbance of Tenant's use or possession of the Premises and without being
liable in any manner to the Tenant.
11. HOLDING OVER.
In the event of a holding over by Tenant after the expiration or termination of
this Lease without the written consent of Landlord, Tenant shall be deemed a
month to month tenant upon all of the provisions of the Lease pertaining to the
obligations of Tenant excepting, however, any option to renew extend or expand
contained in this Lease, at 150% of the Base Rent for the entire holdover
period, and all attorney fees and other expenses incurred by Landlord in
enforcing its rights hereunder. Any holding over with the consent of Landlord
shall constitute Tenant a month-to-month Tenant at the same Base Rent and all
other Rent paid or payable by Tenant for the last full month of this Lease or
any renewal or extension hereof.
12. SIGNS AND ADVERTISEMENTS.
Tenant shall not put upon nor permit to be put upon or affixed to any
part of the Premises or Project any signs, billboards, or advertisements of
whatsoever kind or nature, except as Landlord has specifically approved in
writing. Landlord hereby approves the signs of Tenant currently located on the
Premises.
13. EMINENT DOMAIN.
If the Premises or any portion thereof (including parking spaces
allotted thereto) are taken under the power of eminent domain, or sold under the
threat of the exercise of said power (all of which are herein called
"condemnation"), this Lease shall terminate as to the part so taken as of the
date the condemning authority takes title or possession, whichever first occurs.
If more than ten percent (10%) of the floor area of the Premises, or more than
twenty five percent (25%) of the land area of the Project which is not occupied
by any building, is taken by condemnation and such taking materially interferes
with the conduct of or access to Tenant's business, Tenant may, at Tenant's
option, by written notice to Landlord within ten (10) business days after
Landlord shall have given Tenant written notice of such taking (or in the
absence of such notice, within ten (10) business days after the condemning
authority shall have taken possession) terminate this Lease as of the date the
condemning authority takes possession. If Tenant does not terminate this Lease
in accordance with the foregoing, this Lease shall remain in full force and
effect as to the portion of the Premises remaining, except that the Base Rent
shall be reduced in the proportion that the floor area of the Premises taken
bears to the total floor area of the Premises prior to such taking. No reduction
of Base Rent shall occur if the only area in the Project which is taken is that
which does not have a Building located thereon. Any award of the taking of all
or any part of the Premises under the power of eminent domain or any payment
made under threat of the exercise of such power shall be the property of
Landlord, whether such award shall be made as compensation for diminution in
value of the leasehold or for the taking of the fee, or as severance damages;
provided, however, that Tenant shall be entitled to any award for loss of or
damage to Tenant's trade fixtures and removable personal property, moving
expense and interruption of business so long as any such award does not diminish
Landlord's award. In the event that this Lease is not terminated by reason of
such condemnation, Landlord shall to the extent of severance damages received by
Landlord in connection with such condemnation, repair any damage to the Premises
caused by such condemnation except to the extent that Tenant has been reimbursed
therefor by the condemning authority. Tenant shall pay any amount in excess of
such severance damages required to complete such repair.
14. LANDLORD'S INABILITY TO PERFORM.
If, by reason of inability to obtain and utilize labor, materials, or
supplies; circumstances directly or indirectly the result of a state of war, act
of terrorism or national or local emergency; laws, rules, orders, regulations,
or requirements of any governmental authority now or hereafter in force; strikes
or riots; or by reason of any other cause beyond the reasonable control of
Landlord (collectively "Force Majeure"), Landlord shall be unable to perform or
shall be delayed in the performance of any covenant to supply any service, such
nonperformance or delay in performance shall not render Landlord liable in any
respect for damages to either person or property, constitute a total or partial
eviction (constructive or otherwise), work an abatement of Rent, or relieve
Tenant from the fulfillment of any covenant or agreement contained in this
Lease.
15. ASSIGNMENT TO TRUSTEE.
Neither this Lease nor any interest herein nor any estate hereby
created shall pass to any trustee or receiver in bankruptcy or to any other
receiver or assignee for the benefit of creditors, or otherwise by operation of
law during the term of this Lease or any renewal or extension of the term
hereof.
16. COMMON AREAS.
The term "Common Areas" means all the areas of the Project not intended
for renting and, instead, designed for the common use and benefit of Landlord
and all of the tenants, their employees, agents, customers, and invitees. The
Common Areas include, but not by way of limitation, parking lots, truck courts,
landscaped and vacant areas, driveways, walks, and curbs, with facilities
appurtenant to each, as such areas may exist from time to time. Landlord
expressly reserves the right to add additional Common Area to the Project from
time to time. Landlord shall operate and maintain the Common Areas of the
Project, and the cost of same shall be reimbursed by Tenant to Landlord as
provided for in Section 21. Landlord may delegate its rights with regard to the
Common Area to an independent contractor or management company, which may be an
affiliate of Landlord. Landlord hereby grants the non-exclusive, revocable right
to use the Common Areas to Tenant, Tenant's employees, agents, customers, and
business invitees, which use shall be subject at all times to such reasonable,
uniform, and nondiscriminatory rules and regulations as may from time to time be
established by Landlord.
17. ACCEPTANCE OF PREMISES.
Except as otherwise provided in this Lease, Tenant hereby accepts the
Premises in their condition existing as of the Commencement Date or the actual
date that Tenant takes possession of the Premises, whichever is earlier. Tenant
acknowledges that neither Landlord nor any agent of Landlord has made any
representation or warranty as to the present or future suitability of the
Premise for the conduct of Tenant's business.
18. MAINTENANCE, REPAIRS AND ALTERATIONS.
18.01 Maintenance and Care by Tenant. Tenant shall be responsible for all
maintenance and repair to the Premises of whatsoever kind or nature
that is not hereinafter set forth specifically as the obligation of
Landlord. Tenant shall take good care of the Premises and fixtures, and
keep them in good repair, free from filth, overloading, danger of fire,
or any pest or nuisance, and shall repair any damage or breakage done
by Tenant or its agents, employees, or invitees, including damage done
to the Premises by Tenant's equipment and/or installations. Tenant
shall be responsible for the repair and replacement of all glass and
plate glass on the Premises. Tenant shall maintain and pay for a
service contract with a licensed contractor for the upkeep,
maintenance, repair, and periodic servicing of the heating,
ventilating, and air conditioning systems servicing the Premises.
Tenant shall supply Landlord, from time to time, such information as
Landlord reasonably requests to verify the services being performed
under the service contract. The Landlord, at Landlord's option, may
elect to enter into a service contract with a firm reasonably
acceptable to Tenant for the maintenance and periodic inspection of the
heating, ventilating, and air conditioning equipment in which event
Tenant shall within thirty (30) days of billing therefore, reimburse
Landlord for the costs of such service contract allocated to the
Premises. Notwithstanding any provision to the contrary contained
herein, if the heating, ventilating and air conditioning equipment
should cease to function and not be capable of repair, Landlord shall
reimburse Tenant 50% of the cost to replace the same. In the event that
Tenant fails to maintain the Premises as required herein, Landlord
shall have the right, but not the obligation, to perform such
maintenance and/or repairs, and Tenant shall, within thirty (30) days
of the billing by Landlord, reimburse Landlord for Landlord's costs in
providing such maintenance and/or repairs, together with a fifteen
percent (15%) charge for Landlord's overhead. Upon termination of the
Lease Tenant shall deliver the Premises to Landlord in a broom-clean
condition.
18.02 Maintenance and Repair by Landlord. During the Term of this Lease,
Landlord shall keep and maintain the roof, exterior walls (excluding
glass or plate glass), gutters, and downspouts of the Building in good
condition and repair. Landlord shall be under no obligation and shall
not be liable for any failure to make repairs that are Landlord's
responsibility as designated herein until and unless Tenant notifies
Landlord in writing of the necessity therefor, and Landlord shall have
a reasonable time after such notice to make such repairs. Landlord
reserves the right to the exclusive use of the roof and exterior walls
of the Building. If any portion of the Premises which Landlord is
obligated to maintain or repair is damaged through the fault or
negligence of Tenant, its agents, employees, or invitees, then repairs
necessitated by such damage shall be paid for by Tenant on Landlord's
demand. Except for the obligations of Landlord under Section 18.02
(relating to the condition of the Premises), Section 9 (relating to
destruction of the Premises) and under Section 13 (eminent domain), and
Landlord's obligation to reimburse Tenant 50% of the cost of replacing
the heating, ventilating and air conditioning system if it should cease
to function and be incapable of repair, it is intended by the parties
hereto that Landlord have no obligation, in any manner whatsoever, to
repair and maintain the Premises nor the Building located thereon nor
the equipment therein, whether structural or nonstructural, all of
which obligations are intended to be that of Tenant under Section 18.01
hereof. Tenant expressly waives the benefit of any statute now or
hereinafter in effect which would otherwise afford Tenant the right to
make repairs at Landlord's expense or to terminate this Lease because
of Landlord's failure to keep the Premises in good order, condition and
repairs.
18.03 Alterations and Additions. Tenant shall not make any alterations,
improvements, or additions to the Premises without Landlord's prior
written consent and approval of the plans and specifications.
Alterations, improvements, or additions so made by either of the
parties upon the Premises, except movable furniture and equipment
placed in the Premises at the expense of Tenant, shall become the
property of Landlord and shall remain upon and be surrendered with the
Premises as a part thereof at the termination of this Lease, without
disturbance, molestation, injury, or damage. In the event damage to the
Building shall be caused by moving said furniture and/or equipment in
or out of the Premises, such damage shall be repaired at the expense of
Tenant. Any such alterations shall be made in compliance with all
applicable laws, rules and regulations (including without limitation
the Americans with Disabilities Act and other disabled person access
requirements) to the extent applicable to such alterations or as may be
required by any governmental authority in connection with such
alterations. Tenant shall not make any installations or penetrations on
the roof of the Building, except with Landlord s prior written consent
and in strict compliance with the reasonable requirements of Landlord's
roofing contractor. Landlord's consent to or approval of any
alterations, additions or improvements (or the plans therefor) shall
not constitute a representation or warranty by Landlord, nor Landlord's
acceptance, that the same comply with sound architectural and/or
engineering practices or with all applicable laws, and Tenant shall be
solely responsible for ensuring all such compliance.
18.04 Mechanic's Liens. Tenant shall not permit any mechanic's liens or other
liens to be placed upon the Premises, the Building, or the Project
during the Term of this Lease, and in the case of the filing of any
such lien, Tenant shall promptly pay same; however, Tenant shall have
the right to contest the validity or amount of any such lien upon
Tenant's prior posting of security with Landlord, which security, in
Landlord's sole judgment, must be adequate to pay and discharge any
such lien in full, plus Landlord's reasonable estimate of its legal
fees. Tenant agrees to pay all legal fees that might be incurred by
Landlord because of any mechanic's liens or other liens placed upon the
Premises.
19. INSURANCE.
19.01 Coverages Required. Tenant hereby agrees to maintain in full force and
effect at all times during the term of this Lease, at its own expense,
for the protection of Tenant and Landlord, as their interest may
appear, policies of insurance issued by a responsible carrier or
carriers licensed to do business in the State of Utah and which are
rated A and have a financial size category of at least VIII in the most
recent Best's Key Rating Guide, or any successor thereto (or if there
is none, an organization having a national reputation), which afford
the following coverages:
(A) commercial general liability insurance, including contractual
liability (specifically covering this Lease), fire legal
liability, and premises operations, with the following minimum
limits: General Aggregate $2,000,000.00; Products/Completed
Operations Aggregate $2,000,000.00; Each Occurrence
$1,000,000.00; Personal and Advertising Injury $1,000,000.00;
Medical Payments $5,000.00 per person;
(B) Umbrella/Excess Liability on a following form basis with the
following minimum limits: General Aggregate $10,000,000.00;
Each Occurrence $10,000,000.00;
(C) Workers' Compensation with statutory limits;
(D) Employer's Liability insurance with the following limits:
Bodily injury by disease per person $1,000,000.00; Bodily
injury by accident policy limit $1,000,000.00; Bodily injury
by disease policy limit $1,000,000.00;
(E) A "causes of loss, special form of insurance" policy, commonly
referred to in the industry as an "all risk, fire and extended
coverage" policy, with vandalism and malicious mischief
endorsements, covering Tenant's furniture, equipment, and
personal property, to the extent of not less than their full
replacement value.
(F) Loss of income/business interruption insurance in such amounts
as will reimburse Tenant for direct or indirect loss of
earnings attributable to all perils commonly insured against
under an extended coverage property insurance policy or
attributable to prevention of access to or use of the Premises
or the Building as a result of such perils but in no event in
an amount less than the Base Rent and all additional rent
payable hereunder for six (6) months.
19.02 Deductibles. Tenant may, with the written consent of Landlord, elect to
have reasonable deductibles in connection with coverages required in
Section 19.01 above.
19.03 Certificates. Tenant shall deliver to Landlord at least thirty (30)
days prior to the time such insurance is first required to be carried
by Tenant, and thereafter at least thirty (30) days prior to expiration
of such policy, Certificates of Insurance evidencing the above coverage
with limits not less than those specified above. Such Certificates,
with the exception of Workers Compensation, shall name Landlord,
Landlord's property manager and such other persons as Landlord may
reasonably designate as additional insureds as their interests may
appear and shall expressly provide that the interest of each shall not
be affected by a breach by Tenant of any policy provision for which
such Certificates evidence coverage. All Certificates of Insurance
shall provide not less than thirty (30) days' prior written notice to
Landlord in the event of material alteration to or cancellation of the
coverage evidenced by such Certificates of Insurance.
19.04 Mutual Waiver of Subrogation. Landlord and Tenant do each hereby
release the other from any and all liability or responsibility (to the
other or to anyone claiming through or under the other by way of
subrogation or otherwise) for any loss or damage to the property caused
by fire, any of the extended coverage perils, or any other insured
peril, even if such fire or other casualty shall have been caused by
the negligence of the other party or anyone who shall be covered under
such policy, to the extent of coverage under the relevant policy. Such
waiver of subrogation shall be effective with respect to loss or damage
occurring only during such time as Landlord's and Tenant's policies
shall be in force and effect with respect to such loss or damage and
shall contain a clause or endorsement to the effect that any such
release shall not adversely affect or impair said policies or prejudice
the right of the releasing party to recover thereunder. Landlord and
Tenant each agree that their policies shall include such a clause or
endorsement.
19.05 Indemnification of Landlord. Tenant shall indemnify, protect and defend
Landlord, Landlord's property manager and their respective agents,
contractors and employees (collectively, the Indemnified Parties ) and
save them harmless from and against any and all loss , and against all
claims, actions, damages, liability, costs, fees and expenses
(including, without limitation, attorneys and consultants fees) in
connection with loss of life, bodily and personal injury, or damage to
property (real or personal) arising from any occurrence in, upon, or at
the Premises or any part thereof, or occasioned by the active or
passive negligence or willful misconduct of Tenant, its agents,
contractors, employees, servants, licensees, concessionaires, or
invitees or by anyone permitted to be on the Premises by Tenant. Tenant
assumes all risks of and Landlord shall not be liable for injury to
person or damage to Tenant's property (real or personal) or the
property of Tenant's agents, servants, or employees resulting from the
condition of the Premises, or from the bursting or leaking of any and
all pipes, utility lines, connections, or air conditioning,
ventilating, or heating equipment in, on, or about the Premises, or
from water, rain, or snow which may leak into, issue from, or flow from
any part of the roof or the Building. Tenant agrees, at all times, to
indemnify and hold the Indemnified Parties harmless against all
actions, claims, demands, costs, damages, or expenses of any kind which
may be brought against or made against the Indemnified Parties or which
the Indemnified Parties may pay or incur by reason of Tenant's
occupancy of the Premises or Tenant's negligent performance or failure
to perform any of its obligations under this Lease. In the event that
Landlord shall, without fault on its part, be made a party to any
litigation commenced by or against Tenant, Tenant shall protect and
hold the Indemnified Parties harmless and shall pay all costs,
expenses, and reasonable attorney fees incurred or paid by the
Indemnified Parties in connection with such litigation. Notwithstanding
the foregoing, Landlord shall indemnify, protect and defend Tenant, and
its respective agents, contractors and employees and save them harmless
from and against any and all loss, and against all claims, actions,
damages, liability, costs, fees and expenses (including, without
limitation, attorneys and consultants fees) in connection with loss of
life, bodily and personal injury, or damage to property (real or
personal) arising from any occurrence in, upon, or at the Premises or
any part thereof, which is occasioned by the active or passive
negligence or willful misconduct of Landlord, its agents, contractors,
employees, servants, licensees, or invitees or by anyone permitted to
be on the Premises by Landlord. The obligations of this Section 19.05
shall survive the expiration or earlier termination of the Lease.
19.06 Increased Insurance Risk. Tenant shall not permit the Premises to be
used for any purpose which would render the insurance thereon void or
the insurance risk more hazardous or cause the State Board of
Insurance, any other insurance authority or Landlord's insurance
carrier to disallow any of Landlord's sprinkler credits. If any
penalty, surcharge or increase in Landlord's insurance premiums is
imposed because of Tenant's original or subsequent placements or use of
storage racks or bins, Tenant's method of storage, the nature of
Tenant's inventory, Tenant's abandonment of the Premise or any other
act of Tenant, Tenant shall pay as additional Rent, the increase in
Landlord's insurance premiums, and, upon demand by Landlord, Tenant
agrees to correct at Tenant's expense the cause of such penalty,
surcharge or increase to the satisfaction of the particular insurance
authority or carrier.
20. HAZARDOUS MATERIALS.
20.01 Lessor's Prior Consent. Notwithstanding anything contained in this
Lease to the contrary, Tenant shall not cause or permit any Hazardous
Materials (as defined in Section 20.02 below) to be brought upon, kept,
stored, discharged, released or used in, under or about the Premises by
Tenant, its agents, employees, contractors, subcontractors, licensees
or invitees, without the prior written consent of Landlord, which
Landlord may grant or withhold in Landlord's sole discretion.
20.02 Compliance with Hazardous Materials Laws. Tenant shall at all times and
in all respects comply with all federal, state and local laws,
ordinances and regulations relating to or involving the use,
generation, manufacture, storage, discharge, release, disposal or
transportation of any materials, substances or wastes which are
considered to be or may be hazardous to human health or safety or to
the environment due to their radioactivity, ignitability,
corrositivity, reactivity, carcinogenicity, infectiousness or other
harmful or potential harmful properties and which are defined as or
included within the definition of "hazardous materials," "toxic
substances" or "chemicals known to cause cancer or reproductive
toxicity" under any Hazardous Materials Laws (collectively, "Hazardous
Materials"). All laws, ordinances and regulations relating to
industrial hygiene, environmental protection or the use, analysis,
generation, manufacture, storage, discharge, release, disposal or
transportation of Hazardous Materials are collectively referred to
herein as "Hazardous Materials Laws".
Tenant shall handle, treat, deal with and manage any and all Hazardous
Materials in, on, under or about the Premises in total conformity with all
applicable Hazardous Materials Laws and prudent industry practices regarding
management of such Hazardous Materials. Upon expiration or earlier termination
of this Lease, Tenant shall, at Tenant's sole cost and expense, cause all
Hazardous Materials brought or allowed on the Premises during the Lease Term to
be removed from the Premises and transported for use, storage or disposal in
accordance and in compliance with all applicable Hazardous Materials Laws.
Tenant shall not take any remedial action in response to the presence of any
Hazardous Materials in or about the Premises or enter into any settlement
agreement, consent decree or other compromise in respect to any claims relating
to any Hazardous Materials in any way connected with the Premises, without first
notifying Landlord of Tenant's intention to do so and affording Lessor ample
opportunity to appear, intervene or otherwise appropriately assert and protect
Landlord's interests with respect thereto.
20.03 Notices. Tenant shall immediately notify Landlord in writing of: (i)
any enforcement, cleanup, removal or other governmental or regulatory
action threatened, instituted, or completed pursuant to any Hazardous
Materials Laws; (ii) any claim made or threatened by any person against
Tenant or the Premises relating to damage, contribution, cost recovery
compensation, loss or injury resulting from or claimed to result from
any Hazardous Materials; and (iii) any reports made to any
environmental agency arising out of or in connection with any Hazardous
Materials on or removed from the Premises, including any complaints,
notices, warnings or asserted violations in connection therewith.
Tenant shall also supply to Landlord as promptly as possible, and in no
event later than five (5) business days after Tenant first receives or
sends the same, copies of all claims, reports, complaints, notices,
warnings or asserted violations relating in any way to the Premises or
Tenant's use thereof. Tenant shall maintain copies of hazardous waste
manifests reflecting the legal and proper disposal of all Hazardous
Materials removed from the Premises and supply Landlord with copies of
same on request.
20.04 Indemnification of Landlord. Tenant shall indemnify, protect, defend
and hold the Indemnified Parties harmless from any and all damages,
losses, expenses, liabilities, obligations, costs, fees and expenses
(including without limitation attorneys and consultants fees), in any
way arising out of or related to the use, generation, storage,
handling, transportation, release, discharge or disposal of Hazardous
Materials on or about the Premises during the term of this Lease. The
obligations of this Section 20.04 shall survive the expiration or
earlier termination of the Lease.
20.05 Landlord's Right to Order Environmental Studies. From time to time
during the term of this Lease, if Landlord shall have reasonable cause
to believe that a release of Hazardous Materials has occurred at the
Premises, or from the Premises into the Common Areas or the
environment, Landlord may retain a qualified environmental consultant
(a "Consultant") to conduct an environmental investigation of the
Premises, Common Areas, or other areas that may be affected by the
suspected release of Hazardous Materials (1) for Hazardous Materials
contamination in, about or beneath such areas and (2) to assess the
compliance of Tenant with the provisions of this Section 20 of the
Lease. Additionally, Landlord shall have the right within the last one
hundred twenty (120) days of the term of this Lease to order an
environmental assessment to determine whether the Premises, Common
Areas or the environment surrounding the Premises contain any Hazardous
Materials that may be attributable to Tenant's use of the premises. In
the event Landlord's Consultant determines that a release of Hazardous
Materials attributable to Tenant's use of the Premises has occurred at
the Premises, or from the Premises into the Common Areas or the
environment, Tenant shall pay the cost of any such environmental
assessment and comply with all reasonable recommendations of the
Consultant as to any precautions to be taken with respect to the
storage, use, disposal, handling or emission of Hazardous Materials.
Landlord will provide Tenant with written notice five (5) days prior to
any proposed investigation to be undertaken hereunder. Tenant shall
cooperate with the Consultant to allow entry and reasonable access of
the Consultant to all portions of the Premises for the purposes of the
investigation.
21. ADDITIONAL RENT.
21.01 Real Estate Taxes.
1. Tenant shall pay to Landlord, as additional Rent, Tenant's
Proportionate Share of Landlord's Real Estate Taxes for the
Project for each Tax Year during the Term of this Lease or any
renewal, extension, or holding over hereof. Such additional
Rent payments by Tenant shall be due and payable on the first
day of each month during each Tax Year, each such payment in
an amount equal to one-twelfth (1/12) of Tenant's
Proportionate Share of Landlord's obligation for Real Estate
Taxes for the applicable Tax Year. The sum set out in Section
1.01M shall be the monthly charge for the first Tax Year. For
each subsequent Tax Year the amount payable under Section
1.01M shall be adjusted to reflect Landlord's estimate of
Tenant's obligation for Real Estate taxes for that Tax Year.
In the event the sum of such monthly payments by Tenant for a
particular Tax Year exceeds Tenant's Proportionate Share of
Landlord's Real Estate Taxes for the applicable Tax Year,
provided Tenant is not in default, Landlord shall refund or
credit such excess payment to Tenant. In the event the sum of
Tenant's monthly payments for a particular Tax Year is less
than Tenant's Proportionate Share of Landlord's Real Estate
Taxes for the applicable Tax Year, Tenant shall pay such
deficiency upon demand. "Tax Year", as used herein, shall mean
each calendar year during the Term of the Lease or any
renewal, extension, or holding over hereof in which Real
Estate Taxes are billed against the Project regardless of the
Year in which the assessment for Real Estate Taxes occurs. For
the purposes of this Section, the first Tax Year shall be the
calendar year in which the Lease Term commences. Upon receipt
of written request Landlord shall provide Tenant with copies
of the applicable tax notices and Landlord's calculation of
Tenant's share of Landlord's Real Estate Taxes.
2. "Real Estate Taxes" shall mean: (a) all ad valorem Real Estate
Taxes on the Project (adjusted after protest or litigation, if
any) for any part of the Term of this Lease, exclusive of
penalties; (b) any taxes which shall be levied in lieu of any
such ad valorem Real Estate Taxes; (c) any special assessments
for benefits on or to the Project paid or payable in annual
installments by Landlord; (d) occupational taxes or excise
taxes levied on rentals derived from the operation of the
Project for the privilege of leasing property; and (e) the
expense of protesting, negotiating, or contesting the amount
or validity of any such taxes, charges, or assessments, such
expense to be applicable to the Tax Year of the item
contested, protested, or negotiated.
3. If the Term of this Lease shall end during a Tax Year of which
only part is included in the Term hereof, the amount of such
additional Rent shall be prorated on a per diem basis and
shall be paid on or before the last day of the Term. If the
Term of this Lease ends during any Tax Year before the amount
of the Real Estate Taxes is established and the amount payable
by Tenant has not been finally determined under the provisions
of this Section, an amount payable for that portion of the
Lease Term during the Tax Year shall be reasonably estimated
by Landlord, and the estimated amount shall be promptly paid
by Tenant should such estimated amount paid by Tenant exceed
its actual obligation under this Section then Landlord shall
refund such excess amount.
21.02 Common Expenses.
1. During the Term of this Lease or any renewal, extension, or
holding over hereof, Tenant shall pay to Landlord, as
additional Rent, Tenant's Proportionate Share of the Common
Expenses.
2. For the purpose of this Section, the "Common Expense" means
Landlord's total costs and expenses incurred during each Lease
year in connection with owning, operating, maintaining, and
repairing the Project, herein defined, including, but without
limitation by enumeration: costs for all management fees,
electrical current, gas, water, sewer, or fuels used in
connection with the operation, maintenance, and repair of the
Common Areas or the Building; the amount paid for all
electricity furnished to the Common Area to light the parking
lots or for any other common purpose; the amount paid for all
labor and/or wages and other payments, including costs to
Landlord of worker's compensation and disability insurance,
payroll taxes, and welfare and fringe benefits, made to
janitors, employees, contractors, and subcontractors of
Landlord who are involved in the operation and maintenance of
the Common Areas and the Project; charges of any independent
contractors employed in the care, operation, maintenance,
cleaning, and landscaping of the Common Areas; the amount paid
for all supplies, tools, replacements parts or components,
equipment, and necessities which are occasioned by everyday
wear and tear; the premiums for all insurance maintained by
Landlord for the Project; and the pro rata costs of machinery
and equipment purchased and/or leased by Landlord in order to
perform Common Area maintenance. To the extent that Landlord
provides services which are not separately metered or directly
billed to Tenant the costs of such services shall be included
in the Common Expenses. Common Expenses shall not include
interest on debt, capital retirement of debt and depreciation;
however Common Expenses shall include Landlord's capital
expenditures incurred for the purpose of reducing Common Area
or Building operating costs and capital expenditures incurred
by Landlord that are required by changes or amendments in laws
or regulations governing the Premises or the Project, plus
interest on the unamortized costs of each such capital
expenditure at the rate of 10% per annum or such higher rate
as Landlord may have incurred on funds borrowed to construct
such improvements, amortized over the useful life of the
respective improvements of a capital nature. If Landlord
elects to self-insure or includes the Project under blanket
insurance policies covering multiple properties, then the term
"Common Expenses " shall also include the portion of the cost
of such self-insurance or blanket insurance allocated by
Landlord to this Project.
3. For the purposes of this Section, the term "Lease Year" shall
mean in the case of the first Lease Year, that period from the
Commencement Date of the Term to the first succeeding December
31; thereafter, "Lease Year" shall mean each successive twelve
(12) calendar month period following the expiration of the
first Lease Year except that should the Expiration Date be any
day other than on December 31, then the last Lease Year shall
be the period from the end of the preceding Lease Year to the
Expiration Date.
21.03 Payment of Common Expense. Tenant's obligation for the Common Expenses
for each Lease Year during the Lease Term shall be paid in monthly
installments on the first day of each calendar month in advance. The
first Lease Year's monthly installment amount is set out in Section
1.01L above. Within a reasonable period after the end of the first
Lease Year and within a reasonable period after the end of each Lease
Year thereafter, Landlord shall notify Tenant of Tenant's monthly
obligation for Common Expenses which Landlord estimates it will incur
for the then current Lease Year and the Common Expenses provided for in
Section 1.01L shall be adjusted accordingly on the first day of the
first month following such notice. Within a reasonable period after the
end of each Lease Year, Landlord shall furnish Tenant with a statement
of the actual amount of Tenant's obligation for Common Expenses for
such period, together with Landlord's calculation of the amount of
Tenant's obligation. In the event the total of Tenant's monthly
installments paid for any Lease Year does not equal Tenant's
Proportionate Share as shown on such statement, then Tenant shall,
within ten (10) days of the mailing of the statement, pay Landlord any
deficiency, or Landlord upon receipt of such annual statement shall
issue to Tenant a credit invoice for such excess, as the case may be.
Upon request delivered by Tenant within thirty (30) days after the date
that Landlord delivers Landlord s statement, Landlord shall provide
additional detail to Tenant regarding the calculation of Common
Expenses for the year in question. The statement of Common Expenses
shall be presumed correct and shall be deemed final and binding upon
Tenant unless Tenant in good faith objects in writing thereto within
thirty (30) days after delivery of the statement to Tenant (which
writing shall state, in reasonable detail, all of the reasons for the
objection); and Tenant pays in full, within thirty (30) days after
delivery of the statement to Tenant, the amount shown on the statement
as being owed by Tenant, regardless of whether such amount is in
dispute. Tenant's dispute of any amount shown on Landlord's statement
shall not excuse Tenant from promptly paying such amount as required
above, provided however if it is determined that the amount specified
in Landlord's statement as being payable by Tenant was over stated and
Tenant has otherwise complied with the requirements of this Section,
then Landlord shall pay or credit to Tenant the amount of such
overcharge. Tenant's failure to pay the amount shown on Landlord's
statement within thirty (30) days after delivery thereof or Tenant's
failure to pay in a timely manner the revised estimate of Landlord's
determination of Common Expenses shall be deemed an irrevocable waiver
of Tenant s right to contest and/or receive any credit or reimbursement
for an overcharge of Common Expenses shown on the Landlord's statement
under which payment is required at that time.
22. DEFAULT AND REMEDIES.
22.01 Events of Default. The occurrence of any of the following events shall
constitute an Event of Default on the part of Tenant.
(A) Tenant shall at any time fail to pay Rent when due; or
(B) Tenant shall fail to keep, perform, or observe any other
covenant, agreement, condition, or undertaking described
hereunder and shall fail to remedy such default within thirty
(30) days after written notice thereof has been mailed by
Landlord to Tenant; or if such default is one that will take
longer than thirty (30) days to remedy, Tenant fails to
commence the cure of such default within said thirty (30) day
period and/or fails to diligently pursue such cure to
completion; or
(C) This Lease or the Premises or any part thereof shall be taken
upon execution or by other process of law directed against
Tenant or shall be taken upon or subject to any attachment at
the instance of any creditor of or claimant against Tenant and
said attachment shall not be discharged or disposed of within
thirty (30) days after the levy thereof; or
(D) There is a filing of any petition or commencement of any case
or proceeding by Tenant under any provision or chapter of the
Federal Bankruptcy Act or any other federal or state law
relating to Tenant's insolvency, bankruptcy, or
reorganization; or
(E) There is a filing of any petition or commencement of any case
or proceeding described in subparagraph (D) above against
Tenant, unless such petition and all proceedings initiated
thereby are dismissed within sixty (60) days from the date of
such filing; or
(F) The Premises shall be vacated or abandoned by Tenant,
regardless or whether or not Tenant continues to pay Rent, and
such vacation or abandonment continues for five (5) days after
written notice of such condition from Landlord to Tenant..
22.02 Remedy. Upon the occurrence of an Event of Default Landlord shall have
the right, without further notice to or demand upon Tenant, to re-enter
and take exclusive possession of the Premises, with or without force or
legal process; to refuse to allow Tenant to enter the same or have
possession thereof; to change the locks on the doors to the Premises;
to take possession of any furniture or other property in or upon the
Premises (Tenant hereby waiving the benefit of all exemptions by law)
and to sell the same at public or private sale without notice and apply
the proceeds thereof to the costs of sale, payment of damages, and
payment of the Rent due under this Lease; all without Landlord being
liable to Tenant for any damages or any prosecution therefor; and
Landlord shall have the right;
(i) As an agent of Tenant, to relet the Premises for the balance
of the Term of this Lease or for a shorter or longer Term,
with or without the granting of free rent or other market
concessions, and to receive the rents therefor; applying them
first to the payment of all of Landlord's expenses of such
reletting, such as, repairs, improvements, broker's
commissions and, second, to the payment of remedying all
damages suffered to the Premises and, third, to all Rent due
and thereafter becoming due under this Lease, with Tenant
remaining liable for and hereby agreeing to pay Landlord any
such deficiency on a monthly basis during the Lease Term on
the days Rent would be due hereunder; or
(ii) To cancel and terminate the remaining Term of this Lease,
regardless of whether Landlord has previously elected to relet
or has relet the Premises as permitted in (i) above, to
re-enter and take possession of the Premises free of this
Lease, and thereafter this Lease shall be null and void, and
the Rent in such case shall be apportioned and paid on and up
to the date of such entry and possession by Landlord.
Thereafter Tenant shall be liable for and pay all Rents
accrued, due or owing as of the date or termination, as well
as the costs to repair damage to the Premises incurred by
Landlord by reason of Tenants breach or default of this Lease;
or
(iii) To treat such default as a breach of this Lease and terminate
this Lease by written notice to Tenant and recover from Tenant
as damages for such breach:
(a) the worth at the time of award of any unpaid Rent
which had been earned at the time of such
termination; plus
(b) the worth at the time of award of the amount by which
the unpaid Rent which would have been earned after
termination until the time of award exceeds the
amount of such rental loss Tenant proves could have
been reasonably avoided; plus
(c) the worth at the time of award of the amount by which
the unpaid Rent for the balance of the term after the
time of award exceeds the amount of such rental loss
that Tenant proves could be reasonably avoided; plus
(d) any other amount necessary to compensate Landlord for
all the detriment proximately caused by Tenant
failure to perform its obligations under this Lease
or which in the ordinary course of things would be
likely to result therefrom; plus
(e) such reasonable attorneys' fees incurred by Landlord
as a result of such default, and costs in the event
suit is filed by Landlord to enforce such remedy; and
(f) at Landlord's election, such other amounts in
addition to or in lieu of the foregoing as may be
permitted from time to time by applicable law.
As used in subparagraphs (a) and (b) above, the "worth at the time of
award" is computed by allowing interest at the rate of ten percent (10%) per
annum. As used in subparagraph (c) above, the "worth at the time of award" is
computed by discounting such amount at the discount rate of the Federal Reserve
Bank of San Francisco at the time of award, plus one percent (1%).
All rights and remedies expressly provided in the Lease for Landlord's
protection shall be cumulative and shall be in addition to any other rights and
remedies provided by law. Landlord shall be entitled to recover from Tenant
reasonable attorneys' fees and costs incurred by Landlord in enforcing its
rights hereunder. In the event Landlord elects to re-enter or take possession of
the Premises, Tenant agrees to quit and peaceably surrender the Premises and
possess and repossess itself thereof, and may have, hold, and enjoy the Premises
and the right to receive all rental income of and from the same. No such
re-entry and taking of possession by Landlord shall be construed as an election
on Landlord's part to terminate or surrender this Lease unless Landlord gives
notice to Tenant specifically terminating the Lease. Unless a written notice of
such intention is served on Tenant, any service of demand for the payment of
rent or possession required under applicable law to recover the Premises does
not constitute an election on the part of Landlord to terminate this Lease, nor
shall such notice or re-entry by Landlord or forfeiture by Tenant relieve Tenant
of its continuing liability for unaccrued rent.
A waiver by Landlord of any breach or default by Tenant under the terms
and conditions of this Lease shall not be construed to be a waiver of any
subsequent breach or default or of any other term or condition of this Lease,
and a failure of Landlord to assert any breach or to declare a default by Tenant
shall not be construed to constitute a waiver thereof, so long as such breach or
default continues unremedied.
22.03 Landlord's Default. Landlord shall not be deemed to be in default in
the performance of any obligation required to be performed by Landlord
hereunder unless and until Landlord has failed to perform the
obligation within thirty (30) days after receipt of written notice by
Tenant to Landlord specifying wherein Landlord has failed to perform
the obligation; provided, however, that if the nature of Landlord's
obligation is such that more than thirty (30) days are required for its
performance, then Landlord shall not be deemed to be in default if
Landlord shall commence the performance within the thirty (30) day
period and thereafter shall diligently prosecute the same to
completion.
22.04 Landlord's Right to Perform Tenant's Covenants. If Tenant shall at any
time fail to make any payment or perform any other act on its part to
be made or performed under this Lease, Landlord may, but shall not be
obligated to, make the payment or perform any other act to the extent
Landlord may deem desirable and, in connection therewith, pay expenses
and employ counsel. Any payment or performance by Landlord shall not
waive or release Tenant from any obligations of Tenant under this
Lease. All sums so paid by Landlord, and all penalties, interest and
costs in connection therewith, shall be due and payable by Tenant on
the next day after any payment by Landlord, together with interest
thereon at the Interest Rate (as defined in Section 32), from that date
to the date of payment thereof by Tenant to Landlord, plus collection
costs and attorneys' fees. Landlord shall have the same rights and
remedies for the nonpayment thereof as in the case of default in the
payment of Rent.
23. NOTICES.
Except as other wise herein provided, whenever by the terms of this
Lease notice shall or may be given either to Landlord or to Tenant, such notice
shall be in writing and shall be deemed to have been properly served if
delivered personally, sent by Federal Express or other national overnight
courier or through the U.S. Postal Service, certified mail, postage prepaid, to
Landlord at the addresses set forth below or such other person or place as
Landlord may designate in writing and to Tenant at the Premises. The date of
personal delivery or receipt of the notice, one (1) business day after deposit
with such overnight courier or three (3) business days after mailing, whichever
is earlier shall be deemed the date of service of notice. Notice may also be
served by Landlord or Tenant in the same manner as provided for personal service
under the Rules of Civil Procedure in the State of Utah. Landlord's addresses
for notice are as follows:
Landlord: WDCI, Inc.
ATTN: Vice President - Property Management
000 Xxxxxx Xxxxxx
Xxxxxxxx, XX 00000
With a copy to: WDCI, Inc.
ATTN: General Counsel
000 Xxxxxx Xxxxxx
Xxxxxxxx, XX 00000
Tenant: Rubicon Medical Corporation
ATTN:
0000 Xxxx 0000 Xxxxx
Xxxx Xxxx Xxxx, Xxxx 00000
24. PERSONS BOUND.
The agreements, covenants, and conditions of this Lease shall be
binding upon and shall insure to the benefit of the heirs, legal
representatives, successors, and assigns of each of the parties hereto, except
that no assignment, encumbrance, or subletting by Tenant, unless permitted by
the provisions of this Lease, without the prior written consent of Landlord,
shall vest any right of an assignee, encumbrance, or sublessee of Tenant. The
singular herein, in referring to either Landlord or Tenant, shall be deemed to
include the plural where the context so requires. If there be more than one
Tenant herein named, the provisions of this Lease shall be applicable to and
binding upon such Tenant jointly and severally.
25. SECURITY DEPOSIT.
Tenant herewith deposits with Landlord the sum referenced in the Basic
Terms as a Security Deposit for the performance by Tenant of every covenant and
condition of this Lease. Said deposit may be commingled with other funds of
Landlord and shall bear no interest. If Tenant shall default with respect to any
covenant or condition of this Lease, Landlord may apply the whole or any part of
such Security Deposit to the payment of any sum in default or any sum which
Landlord may be required to spend by reason of Tenant's default, including, but
not limited to, applying the Security Deposit first to the costs of any
restoration and/or cleanup made necessary by reason of above normal wear and
tear of the Premises. It is agreed that the Security Deposit is not to be
considered as the last month's Rent under this Lease. Should Tenant comply with
all of the covenants and conditions of this Lease, the Security Deposit or any
balance thereof shall be returned to Tenant within a reasonable time after the
expiration of the Term hereof. If Landlord uses or applies all or any portion of
the deposit, Tenant shall within ten (10) days after written demand therefore
deposit cash with Landlord in an amount sufficient to restore the deposit to the
full amount hereinabove stated and Tenant's failure to do so shall be a material
breach of this Lease.
26. [INTENTIONALLY OMITTED]
27. SUBORDINATION/FINANCIAL DISCLOSURE.
Landlord shall have the right to transfer, mortgage, pledge or
otherwise encumber, assign or convey in whole or in part the Premises, building,
Project, this Lease and all rents and amounts payable by Landlord under the
provisions hereof, and Tenant shall continue its performance hereunder
notwithstanding any such transfer. At Landlord's option, or at the option of any
mortgagee or ground lessee of Landlord, this Lease shall be made subordinate to
any ground lease, mortgage, deed of trust or any other hypothecation or security
now or hereafter placed upon or affecting real property of which the premises
are a part and to any and all advances made on the security thereof and to all
renewals, modifications, consolidations, replacements and extensions thereof
pursuant to a written subordination agreement between Tenant and any such ground
lessee or mortgagee. Notwithstanding the foregoing, the subordination of
Tenant's interest pursuant to the terms hereof shall be conditional on such
mortgagee or ground lessee entering into a commercially reasonable
non-disturbance agreement with Tenant, which shall provide for the continuation
of the Lease for the remaining term hereof on the terms and conditions hereof,
notwithstanding the termination of any relevant ground lease or a foreclosure,
deed in lieu of foreclosure or other transfer under any mortgage or deed of
trust affecting the Project or the Premises, so long as Tenant shall have paid
rent and all other sums required to be paid under this Lease and shall otherwise
be in compliance with the terms hereof. Tenant agrees to execute any documents
required to effectuate an attornment or subordination pursuant to the terms
hereof and Tenant hereby irrevocably appoints Landlord as its agent and attorney
to execute and deliver any such instrument for and in the name of Tenant if
Tenant fails to do so within ten (10) days after written notice by Landlord or
any ground lessee or mortgagee. Any mortgagee, trustee or ground lessor may
elect to have the Lease prior to the lien of its mortgage, deed of trust or
ground lease and upon written notice to Tenant this lease shall be deemed prior
to such mortgage, deed of trust or ground lease whether this Lease is dated
prior subsequent to the date of said mortgage, deed of trust or ground lease or
the date of recording thereof.
If Landlord desires to finance, refinance, or sell the Premises or any
part thereof, Tenant hereby agrees to deliver to any lender or purchaser
designated by Landlord such financial statements of Tenant as may be reasonably
requested by such lender or purchaser. Such statements shall include the past
three (3) years' consolidated financial statements of Tenant as filed with the
Securities and Exchange Commission. All such financial statements shall be
received by Landlord and such lender or purchaser in confidence and shall only
be used for the purposes herein set forth.
28. ATTORNEY'S FEES.
If either party brings an action to enforce the terms hereof or declare
rights hereunder, the prevailing party in any such action, on trial or appeal,
shall be entitled to its reasonable attorney's fees to be paid by the losing
party as fixed by the court.
29. PARKING.
Tenant's employees, customers, invitees and visitors shall park only in
areas designated for parking of vehicles.
30. EXAMINATION OF LEASE.
Submission of this document for examination or signature by Tenant does
not constitute a reservation of or option for space and it is not effective as a
lease or otherwise until execution by both Tenant and Landlord.
31. Broker's Commissions.Tenant and Landlord each represent and warrant to the
other that neither has had any dealings with any person, firm, broker or finder
(other than those persons, if any, whose names are set forth in this Paragraph
31) in connection with the negotiation of this Lease and/or the consummation of
the transaction contemplated hereby, and no other broker or other person, firm
or entity is entitled to any commission or finder's fee in connection with said
transaction and Tenant and Landlord do each hereby indemnify and hold the other
harmless from and against any costs, expenses, attorneys' fees or liability for
compensation, commission or charges which may be claimed by any such unnamed
broker, finder or other similar party by reason of any dealings or actions of
the indemnifying party. Named brokers:
Landlord's Broker: CB Xxxxxxx Xxxxx
Tenant's Broker: None.
The commission payable to Landlord's Broker with respect to this Lease shall be
pursuant to the terms of the separate commission agreement in effect between
Landlord and Landlord's Broker. Landlord's Broker shall pay a portion of its
commission to Tenant's Broker, if so provided in any agreement between
Landlord's Broker and Tenant's Broker. Nothing in this Lease shall impose any
obligation on Landlord to pay a commission or fee (a) to any party other than
Landlord's Broker or (b) to any party with respect to (i) the exercise by Tenant
of any option or right of first refusal pursuant to this Lease, or (ii) any
extension or renewal of this Lease.
32. LATE PAYMENT/INTEREST.
Tenant's failure to pay Rent or any other payment required of Tenant
hereunder within ten (10) days of the due date therefor shall result in the
imposition of a service charge for such late payment in the amount of five
percent (5%) of such required payment to cover Landlord's administrative costs
to handle late payments. Imposition of and/or payment of a service charge for
late payment shall not constitute a cure or waiver for such default in payment.
In addition, any amount which is not paid when due shall bear interest from the
date due until the date paid at the rate ("Interest Rate") which is the lesser
of fifteen percent (15%) per annum or the maximum rate permitted by law.
33. ESTOPPEL CERTIFICATE.
Tenant shall upon not less than ten (10) day's prior written notice
from Landlord execute, acknowledge and deliver to Landlord a statement in
writing (i) certifying that this Lease is unmodified and is full force and
effect (or, if modified, stating the nature of such modification and certifying
that this Lease, as so modified, is in full force and effect) and the date to
which the Rent and other charges are paid in advance, if any; (ii) acknowledging
that there are not, to Tenant's knowledge, any uncured defaults on the part of
Landlord hereunder, or specifying such defaults if any are claimed; and (iii)
stating the correctness or incorrectness of any other fact related to Tenant's
use and occupancy of the Premises or either or both Landlord's and Tenant's
rights and obligations under this Lease as may be reasonably requested. Any such
statement may be conclusively relied upon by any prospective purchaser or
encumbrancer of the Premises.
At Landlord's option, Tenant's failure to deliver such statement within
such time shall be a material default under this Lease or shall be conclusively
entitle Landlord or any third party to rely on the facts (i) that this Lease is
in full force and effect, without modification except as may be represented by
Landlord, (ii) that there are no uncured defaults in Landlord's performance, and
(iii) that not more than one month's rent has been paid in advance.
34. PARTIAL INVALIDITY.
If any term, covenant, condition or provision of this Lease or the
application thereof to any person or circumstance shall, to any extent, be
invalid or unenforceable, or violate a party's legal rights, then such term,
covenant, condition or provision shall be deemed to be null, void, and
unenforceable; however, all provisions of this Lease, or the application of such
term or provision to persons or circumstances other than those to which are held
invalid, unenforceable, or violative of legal rights, shall not be affected
thereby, and each and every other term, covenant, condition or provision of this
Lease shall be valid and shall be enforced to the fullest extent permitted by
law.
35. CAPTIONS.
The captions used throughout this Lease are for convenience and
reference only and shall in no way be held to explain, modify, amplify, or aid
in the interpretation, construction, or meaning of any provisions in this Lease.
36. ENTIRE AGREEMENT.
This Lease, together with the referenced Rider and Exhibits (which are
incorporated herein by this reference), contains the entire agreement between
the parties, and no modification of this Lease shall be binding upon the parties
unless evidenced by an agreement, in writing, signed by Landlord and Tenant
after the date hereof. No prior agreements or understandings pertaining to this
Lease prior to the date hereof shall be effective.
37. LANDLORD'S LIABILITY.
37.01 Transfer of the Project. Upon transfer of the Project and assignment of
this Lease, Landlord shall be entirely freed and relieved of all
liability under any and all of its covenants and obligations contained
in or derived from this Lease occurring after the consummation of the
transfer and assignment, and from all liability for the Security
Deposit. Tenant shall attorn to any entity purchasing or otherwise
acquiring the Premises at any sale or other proceeding.
37.02 Landlord's Exculpation. In the event of default, breach or violation by
Landlord of any of Landlord's obligations under this Lease, Landlord's
liability to Tenant shall be limited to its ownership interest in the
Building and Project or the proceeds of a public sale of the ownership
interest pursuant to the foreclosure of a judgment against Landlord.
Landlord shall not be personally liable, or liable in any event, for
any deficiency beyond its ownership interest in the Building and
Project.
38. SURRENDER OF PREMISES.
On the expiration or early termination of this Lease, Tenant shall
surrender the Premises to Landlord "broom-clean", in its condition as of the
Commencement Date, normal wear and tear excepted. Tenant shall remove from the
Premises all of Tenant's personal property, trade fixtures and any alterations
required to be removed by Landlord. Tenant shall repair damage or perform any
restoration work required by the removal. If Tenant fails to remove any personal
property, trade fixtures or alterations after the end of the Term as required by
Landlord, Landlord may remove the property and store it at Tenant's expense,
including interest at the Interest Rate. If the Premises are not so surrendered
at the termination of this Lease, Tenant shall indemnify Landlord against all
loss or liability resulting from delay by Tenant in so surrendering the
Premises, including, without limitation, any claims made by any succeeding
tenant, losses to Landlord due to lost opportunities to lease to succeeding
tenants, and attorneys' fees and costs.
39. MORTGAGEE PROTECTION.
In the event of any default on the part of Landlord, Tenant will give
notice by registered or certified mail to any beneficiary of a deed of trust or
mortgagee of a mortgage covering the Building and shall offer the beneficiary or
mortgagee a reasonable opportunity to cure the default, including time to obtain
possession of the Building or the Premises by power of sale or a judicial
foreclosure, if such should prove necessary to effect a cure.
40. OPTION TO EXTEND LEASE.
Landlord hereby grants to the Tenant the one (1), two (2) year option
to extend the term of the Lease, provided that no monetary default of the lease
occurred during the current term of the Lease, and at the time the option is
exercised, this Lease shall be in full force and effect. The Tenant must provide
written notice to Landlord of its intention to exercise the option not later
than one hundred and eighty (180) days prior to the expiration of the current
term of the Lease. Additionally, once the business terms and conditions have
been mutually agreed upon Tenant agrees to return an executed amendment
documenting the terms of the option within fifteen (15) days after its receipt
from Landlord.
The base annual rent rate for the Premises during the Renewal term
shall be at fair market value as mutually agreed upon by Tenant and Landlord,
but in no case less than the Base Rent in effect for the existing Lease. Any
such renewal of this Lease shall be upon the same terms and conditions of this
Lease, except (a) the base rent during the extension term shall be as provided
as above; and (b) Tenant shall not have the right to assign its renewal rights
to a subtenant under this Lease.
41. WAIVER OF TRIAL BY JURY.
LANDLORD AND TENANT HEREBY WAIVE TRIAL BY JURY AND CONSENT TO TRIAL
WITHOUT A JURY IN THE EVENT OF ANY ACTION, PROCEEDING OR COUNTERCLAIM BROUGHT BY
EITHER LANDLORD OR TENANT AGAINST THE OTHER IN CONNECTION WITH THIS LEASE.
IN WITNESS WHEREOF the parties have signed triplicate copies hereof.
TENANT: LANDLORD:
Rubicon Medical, Inc., a Utah corporation WDCI, INC., a Hawaii corporation
By: /s/ Xxxxx X. Xxxxx By: /s/ X.X. Xxxxxx
Name: Xxxxx X. Xxxxx Name: X.X. Xxxxxx
Its: CFO Its: Executive V.P.
By: /s/ Xxxxxxx X. Xxxxxx
Name: Xxxxxxx X. Xxxxxx
Its: Assistant Secretary
