LEASE
305 INTERLOCKEN PARKWAY
INTERLOCKEN ADVANCED TECHNOLOGY ENVIRONMENT
BOULDER COUNTY
BROOMFIELD, COLORADO
TABLE OF CONTENTS
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ARTICLE I - DEMISE......................................... 1
1.1 Demise............................................ 1
1.2 Construction Date................................. 1
ARTICLE II - TERM.......................................... 2
2.1 Term.............................................. 2
2.2 Supplemental Agreement............................ 2
2.3 Landlord's Work................................... 2
2.4 Landlord's Failure to Complete.................... 2
ARTICLE III - RENT......................................... 3
3.1 Base Rent......................................... 3
3.2 Estimated Base Rent............................... 3
3.3 Additional Rent................................... 3
3.4 Interest on Late Payments and Late Payment Charge. 3
ARTICLE IV - TAXES AND OPERATING EXPENSE ADJUSTMENT........ 4
4.1 Definitions....................................... 4
4.2 Payments of Taxes and Operating Expenses.......... 6
4.3 Reimbursement Survives Termination................ 7
4.4 Direct Payment.................................... 8
ARTICLE V - BUILDING SERVICES.............................. 8
5.1 Standard Services................................. 8
5.2 Interruption of Services.......................... 8
5.3 Services Paid by Tenant........................... 9
5.4 HVAC Requirements................................. 9
5.5 Cleaning.......................................... 9
5.6 Re-▇▇▇▇▇▇▇........................................ 9
5.7 Maintenance by Landlord........................... 9
ARTICLE VI - TENANT REPAIR................................. 9
6.1 Damage by Tenant.................................. 9
6.2 Maintenance....................................... 10
6.3 Good Condition.................................... 10
6.4 Surrender......................................... 10
6.5 Broken Glass...................................... 10
ARTICLE VII - ASSIGNMENT AND SUBLETTING.................... 10
7.1 Limitations....................................... 10
7.2 Acceptance of Performance......................... 11
7.3 Document Review................................... 11
ARTICLE VIII - TRANSFER BY LANDLORD AND LIMITED LIABILITY.. 11
8.1 Transfer of Landlord's Interest................... 11
8.2 Limited Liability of Landlord..................... 11
8.3 Pre-Construction Date Liability................... 12
ARTICLE IX - USE OF PREMISES............................... 12
9.1 Use............................................... 12
9.2 Compliance with Rules and Regulations............. 12
ARTICLE X - INSURANCE...................................... 13
10.1 Tenant's Insurance................................ 13
10.2 Landlord's Insurance.............................. 14
10.3 Subrogation....................................... 14
ARTICLE XI - OBSERVANCE OF LAW............................. 14
11.1 Law............................................... 14
11.2 Taxes............................................. 15
ARTICLE XII - WASTE AND NUISANCE........................... 15
12.1..................................................... 15
ARTICLE XIII - ENTRY BY LANDLORD........................... 15
13.1..................................................... 15
ARTICLE XIV - INDEMNIFICATION.............................. 16
14.1 Tenant's Indemnity................................ 16
14.2 Landlord's Indemnity.............................. 16
14.3 Comparative Negligence............................ 16
ARTICLE XV - ALTERATIONS................................... 16
15.1 Alterations by Tenant............................. 16
15.2 Alterations by Landlord........................... 17
ARTICLE XVI - SIGNS AND ADVERTISING........................ 18
16.1..................................................... 18
ARTICLE XVII - SUBORDINATION TO MORTGAGES AND
DEEDS OF TRUST........................................ 18
17.1..................................................... 18
ARTICLE XVIII - ESTOPPEL CERTIFICATE/FINANCIAL INFORMATION..19
18.1 Initial Estoppel Certificate...................... 19
18.2 Additional Estoppel Certificates.................. 19
18.3 Financial Information............................. 19
ARTICLE XIX - QUIET ENJOYMENT.............................. 19
19.1..................................................... 19
ARTICLE XX - FIXTURES...................................... 19
20.1..................................................... 19
ARTICLE XXI - DAMAGE OR DESTRUCTION........................ 20
21.1 Casualty.......................................... 20
21.2 Casualty Caused by Tenant......................... 20
ARTICLE XXII - CONDEMNATION................................ 20
22.1 Eminent Domain.................................... 20
22.2 Damages........................................... 21
22.3 Restoration....................................... 21
ARTICLE XXIII - LOSS AND DAMAGE AND DELAY.................. 21
23.1 Loss and Damage................................... 21
23.2 Delays............................................ 21
ARTICLE XXIV - DEFAULT AND REMEDIES........................ 22
24.1 Default by Tenant................................. 22
24.2 Remedies of Landlord.............................. 22
24.3 Landlord's Default................................ 24
24.4 Personal Property Lien............................ 24
ARTICLE XXV - HOLDING OVER................................. 25
25.1..................................................... 25
ARTICLE XXVI - NOTICE...................................... 25
26.1 Notice............................................ 25
26.2 Change of Address................................. 25
ARTICLE XXVII - SECURITY DEPOSIT........................... 25
27.1..................................................... 25
ARTICLE XXVIII - MISCELLANEOUS PROVISIONS.................. 26
28.1 Captions.......................................... 26
28.2 Waiver............................................ 26
28.3 Entire Agreement.................................. 26
28.4 Severability...................................... 26
28.5 Modification...................................... 26
28.6 Governing Law..................................... 26
28.7 Successors and Assigns............................ 26
28.8 Authorization to Execute.......................... 26
28.9 Guaranty of Lease................................. 27
28.10 Approval of Documents............................. 27
28.11 Financing Contingency............................. 27
ARTICLE XXIX - SUBSTITUTION OF PREMISES.................... 27
29.1..................................................... 27
ARTICLE XXX - RECORDING.................................... 27
30.1..................................................... 27
ARTICLE XXXI - REAL ESTATE BROKER.......................... 28
31.1..................................................... 28
ARTICLE XXXII - RENT PREPAYMENT............................ 28
32.1..................................................... 28
ARTICLE XXXIII - OTHER PROVISIONS.......................... 28
33.1 Budget............................................ 28
33.2 Single Tenant Building............................ 29
33.3 Abandonment and Vacation.......................... 29
33.4 Option to Renew................................... 29
33.5 Option to Expand.................................. 30
EXHIBIT A - LEGAL DESCRIPTION.............................. 33
EXHIBIT B - INTENTIONALLY DELETED.......................... 34
EXHIBIT C - TENANT WORK LETTER............................. 35
EXHIBIT D - COMPONENTS OF TENANT WORK...................... 38
EXHIBIT E - TENANT ESTOPPEL CERTIFICATE.................... 39
EXHIBIT F - INTENTIONALLY DELETED.......................... 41
EXHIBIT G - INTENTIONALLY DELETED.......................... 42
EXHIBIT H - COMPONENTS OF SITE, SHELL, AND CORE............ 43
EXHIBIT I - SUPPLEMENTAL AGREEMENT......................... 44
EXHIBIT J - BASE RENTAL RATE (NNN)......................... 46
EXHIBIT K - EXPANSION PREMISES............................. 48
EXHIBIT 10(nn)
LEASE
CIRRUS LOGIC, INC. FACILITY
305 INTERLOCKEN PARKWAY
INTERLOCKEN ADVANCED TECHNOLOGY ENVIRONMENT
BOULDER COUNTY
BROOMFIELD, COLORADO
THIS LEASE is made this 5th day of July, 1995, by and between Prime West
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Development, Inc. Company, a Colorado corporation ("Landlord") and Cirrus Logic,
Inc., a California Corporation ("Tenant").
W I T N E S S E T H :
ARTICLE I
DEMISE
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1.1 Demise. Landlord does hereby lease to Tenant and Tenant hereby leases from
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Landlord that certain one-story office building (the "Building") consisting of
approximately 50,400 gross square feet (the "Gross Area"), which Building shall
be known as the Cirrus Logic, Inc. Facility, located at ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇,
Interlocken Advanced Technology Environment, Boulder County, Broomfield,
Colorado, which Building shall be situated on that certain real Property (the
"Property") legally described in Exhibit A, attached hereto, together with a
right subject to the provisions hereof, to use all appurtenances thereto,
including, but not limited to, any plazas, common areas, walkways or other areas
in Building or on Property, all of which inclusive of Building are hereinafter
collectively called the "Building Complex" or the "Premises".
Such letting and hiring is upon and subject to the terms, conditions and
covenants herein set forth, and Tenant covenants as a material part of the
consideration for this Lease to keep and perform each and all of said terms,
conditions and covenants by it to be kept and performed and that this Lease is
made upon the condition of such performance.
For purposes hereof, "gross square feet" shall be determined in accordance
with BOMA standards for single tenant buildings.
1.2 Construction Date. Landlord shall commence construction of Building
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("Construction Date") on or before eight (8) months after execution of the Lease
by ▇▇▇▇▇▇. Landlord shall thereafter prosecute the completion of such Building
in a diligent manner. The Construction Date and Landlord's obligations hereunder
are subject to matters outside of Landlord's reasonable control, including
Tenant Delay, delays attributable to compliance with applicable laws and delays
in issuance of permits by the respective regulatory authority and subject to the
terms and conditions of the Tenant Work Letter.
If Landlord has not commenced construction by the Construction Date, as same
may be extended by reason of the above-referenced delays, then Tenant may elect
by written notice to Landlord to terminate this Lease, which notice of
termination must be received by Landlord within thirty (30) days after the
Construction Date (as same may be extended), time being of the essence. In the
event of the termination of this Lease pursuant to the terms of this Section
1.2, neither party shall have any liability or obligation whatsoever to the
other except that any rent or deposit of Tenant shall be promptly refunded,
without interest except as specifically set forth herein, by Landlord.
1
ARTICLE II
TERM
----
2.1 Term. The term of this Lease and ▇▇▇▇▇▇'s obligation to pay rent shall
----
commence on the earlier of (a) the day after the day which is the later to occur
of the date that a certificate of occupancy is issued for the Building or the
day Landlord issues its certificate of substantial completion in accordance with
the Tenant Work Letter attached hereto as Exhibit C, unless any delay in issuing
said certificate of occupancy or certificate of substantial completion is caused
by those matters set forth in Section 7 of Exhibit C, in which event the date of
issuance of the respective certificate of substantial completion shall be deemed
----------
to be the date that the respective certificate would have been issued but for
the Tenant Delay, as hereinafter defined, or (b) the date upon which ▇▇▇▇▇▇
takes occupancy of the Building (the "Commencement Date") and shall end at
twelve (12) p.m. on the last day of the one hundred and eightieth (180th) month
thereafter, unless sooner terminated as herein provided (the "Term").
2.2 Supplemental Agreement. Within five (5) days after the commencement of the
----------------------
Term of this Lease, ▇▇▇▇▇▇ agrees to execute a Supplemental Agreement in the
form attached as Exhibit I to become a part hereof, setting forth the
commencement and termination dates of the term of this Lease and such other
information as set forth therein.
2.3 Landlord's Work. Other than as set forth specifically in this Lease and in
---------------
the Tenant Work Letter, Landlord shall have no further obligation for the
completion of Premises and Tenant shall accept Premises in its "AS IS" condition
as of the date Landlord delivers possession thereof in accordance with the
provisions of the Tenant Work Letter, subject to (i) any punch list items
identified by Tenant prior to its acceptance of the Premises which items are
uncompleted items, material defects in design or defects in construction or are
otherwise in violation of the Landlord's obligation to deliver the Premises in
the condition required by Exhibit C, (ii) any latent defects in the Premises
which ▇▇▇▇▇▇ identifies in writing to Landlord no later than eleven months
subsequent to the Commencement Date and (iii) violations of law relating to
construction of the Building including Building Code violations and failure to
comply with the then applicable standards of Title III of the Americans with
Disabilities Act. Landlord shall promptly correct items (i)-(iii) after receipt
of notice thereof and the cost of correction shall not be borne by Tenant
directly or indirectly, or as a part of Base Rent, Additional Rent, or as an
Operating Expense. Furthermore, Landlord shall continue to have the obligations
set forth in Section 5.7 hereof regarding the structural integrity of the
Building.
2.4 Landlord's Failure to Complete. Notwithstanding anything to the contrary
------------------------------
herein, should the Commencement Date occur on or subsequent to the date which is
the earlier of (i) March 1, 1997 or (ii) the date which is eighteen (18) months
after execution of this Lease by ▇▇▇▇▇▇, unless such delay in the Commencement
Date arises from those matters set forth in Section 7 of Exhibit C, then, within
thirty (30) days from such date, Tenant shall have the option to terminate this
Lease upon written notice to Landlord, the effective date of termination to be
at least sixty (60) days after the date of delivery of Tenant's notice;
provided, that should Landlord meet all requirements set forth in Exhibit C for
the issuance of the certificate of substantial completion prior to the effective
termination date specified in Tenant's notice, such termination notice shall be
of no force and effect and this Lease shall continue in full force and effect
between the parties. However, if this Lease has not commenced on or before two
(2) years from the date hereof, then this Lease shall be automatically
terminated without notice. In the event of the termination of this Lease
pursuant to the terms of this Section 2.4, neither party shall have any
liability or obligation whatsoever to the other except that any rent or deposit
of Tenant shall be promptly refunded, without interest except as specifically
set forth herein, by Landlord.
2
ARTICLE III
RENT
----
3.1 Base Rent. Tenant agrees to pay as base annual rent (the "Base Rent")
---------
during the Term of the Lease the sums as calculated pursuant to Exhibit J
attached hereto. Once determined, Base Rent shall be payable without notice,
deduction, set-off or abatement to Landlord at Building, or such other address
as Landlord may notify the Tenant of in writing, in lawful money of the United
States payable in advance on the first day of each month. If Term commences or
terminates on a day other than the first or last day of a calendar month
respectively, then the installments of Base Rent for such month or months shall
be prorated and the installments so prorated shall be paid in advance. The term
"Lease Year" shall mean each twelve month period subsequent to the Commencement
Date.
3.2 Estimated Base Rent. Tenant acknowledges that Landlord may not be able to
-------------------
calculate Base Rent as of the Commencement Date. As of the Commencement Date,
▇▇▇▇▇▇ agrees to pay monthly Base Rent as reasonably estimated by Landlord. If
the actual Base Rent is greater than the estimated Base Rent, Tenant shall pay
the difference within thirty (30) days of receipt of written notice. If the
actual Base Rent is less than the estimate, then Landlord shall offset such
difference against the next monthly installment of Base Rent and Additional
Rent.
3.3 Additional Rent. Any other sums of money or charges to be paid by the
---------------
Tenant pursuant to the provisions of this Lease may be designated as "Additional
Rent". A failure to pay Additional Rent shall be treated in all events as the
failure to pay rent.
3.4 Interest on Late Payments and Late Payment Charge. Any rent (whether Base
-------------------------------------------------
Rent or Additional Rent) or other amount due from Tenant to Landlord under this
Lease not paid when due shall bear interest from the date due until the date
paid at the rate of one and one-half percent (1-1/2%) per month, but the payment
of such interest shall not excuse or cure any default by Tenant under this
Lease. Failure to charge or collect such interest in connection with any one or
more such late payments shall not constitute a waiver of Landlord's right to
charge and collect such interest in connection with any other or similar or like
late payments. Notwithstanding the above, ▇▇▇▇▇▇▇▇ agrees that it shall, twice
during any calendar year, give written notice of such late payment and if Tenant
pays the late payment within ten (10) days of receipt of written notice,
Landlord will waive the interest for such payment.
Notwithstanding the above, in the event any rent or other amounts owing
hereunder are not paid within five (5) days after the due date, then Landlord
and Tenant agree that Landlord will incur additional administrative expenses,
the amount of which will be difficult if not impossible to determine.
Accordingly, in addition to such required payment, Tenant shall pay to Landlord
an additional one time late charge for any such late payment in the amount of
five percent (5%) of the amount of such late payment; provided, however,
Landlord agrees that it shall, twice during any calendar year, give written
notice of such late payment due and if Tenant pays the late payment within five
(5) days of receipt of written notice, Landlord will waive the late charge for
such payments.
3
ARTICLE IV
TAXES AND OPERATING EXPENSE ADJUSTMENT
--------------------------------------
In addition to Base Rent, Tenant shall reimburse Landlord for Real Estate
Taxes and Operating Expenses (which sum may be adjusted pursuant to Section 4.2)
for Building Complex as hereinafter set forth in this Section.
4.1 Definitions. The following terms shall have the following meanings with
-----------
respect to the provisions of this Section 4.1:
(a) "Tenant's Proportionate or Prorata Share" shall mean one hundred
percent (100%).
(b) "Real Estate Taxes" shall include (a) any form of assessment
(including any so-called "special" assessments), license tax, business license
fee, business license tax, commercial rental tax, levy, charge, penalty or tax,
imposed by any authority having the direct power to tax, including any city,
county, state or federal government, or any school, agricultural, lighting,
water, drainage or other improvement or special district thereof, against
Premises, Building or Property or any legal or equitable interest of Landlord
therein; (b) any tax on Landlord's right to rent or other income from Premises
or against Landlord's business of leasing Premises; and (c) any assessments,
tax, fee, levy or charge in substitution, partially or totally, of or in
addition to any assessment, tax, fee, levy or charge previously included within
the definition of Real Estate Taxes which may be imposed by governmental
agencies for such services as fire protection, street, sidewalk and road
maintenance, refuse removal and for other governmental services formerly
provided without charge to property owners or occupants. It is the intention of
Landlord and the Tenant that all such new and increased assessments, taxes,
fees, levies and charges be included within the definition of Real Estate Taxes
for purposes of this Lease. The following shall also be included within the
definition of Real Estate Taxes for purposes of this Lease, provided, however,
that the Tenant shall pay Landlord the entire amount thereof: (i) any tax
allocable to or measured by the area of Premises or the rental payable
hereunder, including without limitation, any gross income, privilege, sales or
excise tax levied by the State, any political subdivision thereof, city,
municipal or federal government, with respect to the receipt of such rental, or
upon or with respect to the possession, leasing, operating, management,
maintenance, alteration, repair, use or occupancy by the Tenant of Premises or
any portion thereof; and (ii) any tax upon this transaction or any document to
which the Tenant is a party, creating or transferring an interest or an estate
in Premises. "Real Estate Taxes" shall not include Landlord's federal or state
income, franchise, inheritance or estate taxes. "Real Estate Taxes" included in
this definition mean taxes or assessments in the year assessed, without regard
to the year in which same become due or payable. Furthermore, if the Building
Complex excludes any portion of the Real Property as disclosed on Exhibit A,
then the Real Property Taxes shall be equitably reduced on the basis that the
portion of the undeveloped land bears to the appraisal for the total land value.
There shall be no apportioning of improvements unless such parcel is later
improved and is not part of the Building Complex.
(c) "Operating Expenses" shall mean all maintenance and operating costs
of any kind or nature with respect to the operation, ownership and maintenance
of Building Complex in a manner consistent with a "Class A," suburban single-
tenant office building and shall include, but not be limited to, the cost of
building supplies, window cleaning, costs incurred in connection with all energy
sources for Building such as propane, butane, natural gas, steam, electricity,
solar energy and fuel oil; the costs of water and sewer service, janitorial
services, both interior and exterior, general maintenance and repair of Building
Complex including the heating and air conditioning systems and structural
4
components of Building; landscaping, maintenance, repair and striping of all
parking areas; insurance, including fire and extended coverage and public
liability insurance and any rental insurance and all risk insurance carried by
Landlord pursuant to Section 10.2; labor costs incurred in the operation and
maintenance of Building Complex, including wages and other payments; costs to
Landlord for Workmen's Compensation and disability insurance; payroll taxes and
welfare fringe benefits, including professional building management fees, legal,
accounting, inspection and consultation fees incurred in connection with
Building Complex; any expense attributable to costs incurred by Landlord for any
capital improvements or structural repairs to Building or Property required by
any change in the laws, ordinances, rules, regulations or otherwise which were
not in effect on the date Landlord obtained its building permit to construct
Building required by any governmental or quasi-governmental authority having
jurisdiction over Building which costs shall be amortized over the useful life
of the capital improvements or structural repair; and any costs incurred by
Landlord in making capital improvements or other modifications to Building or
any part thereof, which costs shall be amortized over the useful life of such
improvement or modification, in accordance with reasonable life and amortization
schedules and shall be determined by Landlord in accordance with generally
accepted accounting principles. Operating Expenses shall expressly exclude:
(a) any ground lease rental;
(b) depreciation, amortization and interest payments, except as
specifically provided herein, and except on materials, tools, supplies and
vendor-type equipment purchased by Landlord to enable Landlord to supply
services Landlord might otherwise contract for with a third party, where such
depreciation, amortization and interest payments would otherwise have been
included in the charge for such third party's services, all as determined in
accordance with standard accounting practices;
(c) interest, principal, points and fees on debt or amortization on any
mortgage, deed of trust or other debt encumbering the Building or Building
Complex;
(d) costs of Landlord's general corporate overhead in lieu of management
(such as salaries for executives of Landlord and any and all affiliated or
related entities and contributions to employee pension plans);
(e) that portion of any item and service for which Tenant reimburses
Landlord directly as Additional Rent (other than through Operating Expense
pass-through provisions);
(f) electric power and other utility costs if Tenant directly contracts
with the local public utility companies;
(g) costs arising from Landlord's charitable or political contributions;
(h) any depreciation on the Building, or the Building Complex;
(i) any costs related to leasing or selling the Building or any portion
thereof to any tenant or purchasers; provided that leasing and/or management
office rental fees may be included in Operating Expenses so long as (i) such
office is not over 500 square feet in area, and (ii) such fees are equitably
prorated to the extent such office is used for leasing or sales at buildings
other than the Building;
(j) costs relating to the removal or other disposition of any hazardous
materials from any soil or groundwater contamination at the Building Complex or
any portion thereof or any amounts expended by Landlord or its affiliates to
indemnify Tenant or third parties for any liability concerning the presence of
5
hazardous materials in, on or about the Building Complex which relate to any
soil or groundwater contamination, except to the extent caused or contributed to
by Tenant, its agents, employees, contractors or invitees;
(k) any payments for supplies, materials or services provided or
rendered by any affiliates of Landlord to the extent that the costs of such
supplies, materials and services exceed the costs that would have been paid had
the supplies, materials and services been provided or rendered by parties
unaffiliated with Landlord on a competitive basis;
(l) advertising, art, sculpture, and promotional costs except holiday
decorations;
(m) all costs of repair or replacement of any item covered by a warranty
to the extent recoverable on the warranty;
(n) any fines, penalties or interest, or costs resulting from negligence
or willful misconduct of Landlord or its agents, employees and/or independent
contractors; and
(o) capital improvement costs attributable to maintaining, replacing or
maintaining the integrity of structural components of the Building and the costs
of replacing the roof;
(p) management fees in excess of two percent (2%) of annual gross
revenues which Landlord collects from Tenant (specifically excluding those
janitorial costs which are being paid directly by Tenant);
(q) costs of construction to comply with applicable law to the extent
that the Building was constructed in violation of then applicable laws including
Building Code violations and then applicable standards of Title III of the
Americans with Disabilities Act;
(r) insurance deductibles in excess of $1,000.00; and
(s) amounts in excess of insurance policy coverage.
Furthermore, commencing with the second full calendar year of the Term and
thereafter, the controllable costs paid by ▇▇▇▇▇▇ as a part of Operating
Expenses shall not increase by more than three percent (3%) per calendar year of
the Term, cumulative. For purposes hereof, controllable costs are those service
costs contracted for on an hourly basis by Landlord or its managing agent.
4.2 Payments of Taxes and Operating Expenses. It is hereby agreed that
----------------------------------------
during each Lease Year of Term hereof, the Tenant shall pay to Landlord Tenant's
Prorata Share of the amount of the Operating Expenses and Real Estate Taxes for
Building Complex as set forth above. It is agreed that the Tenant shall, during
each calendar year in which the term of this Lease commences pay to Landlord an
estimate of the Tenant's Prorata Share of Real Estate Taxes and Operating
Expenses, if any, as hereinafter set forth. Beginning with the first calendar
year following the year in which this Lease commenced, the Tenant shall pay to
Landlord each month on the first day of the month an amount equal to one-twelfth
(1/12) of Tenant's Prorata Share of the Real Estate Taxes and Operating Expenses
for the new calendar year as reasonably estimated by Landlord, with an
adjustment to be made between the parties at a later date as hereinafter
provided. Furthermore, Landlord may from time to time but no more than three (3)
times during any Lease Year furnish Tenant with notice of a re-estimation of the
Real Estate Taxes and Operating Expenses and Tenant shall commence paying its
re-estimated prorata share on the first day of the month following receipt of
said notice. As soon as practicable following the end of any calendar year, but
in no event later than March 1 of the following calendar year, Landlord shall
submit to the Tenant a statement setting forth the exact amount of the Tenant's
Prorata Share of the Real Estate Taxes and Operating Expenses for the calendar
year just
6
completed and the difference, if any, between the Tenant's actual Prorata Share
of the Real Estate Taxes and Operating Expenses for the calendar year just
completed and the estimated amount of the Tenant's Prorata Share of the Real
Estate Taxes and Operating Expenses (which were paid in accordance with this
subparagraph) for such year. Such statement shall also set forth the amount of
the estimated Real Estate Taxes and Operating Expenses reimbursement for the new
calendar year computed in accordance with the foregoing provisions. To the
extent that the Tenant's Prorata Share of the actual Real Estate Taxes and
Operating Expenses for the period covered by such statement are higher than the
estimated installments which the Tenant previously paid during the calendar year
just completed, the Tenant shall pay to Landlord the difference within thirty
(30) days following receipt of said statement from Landlord. To the extent that
the Tenant's Prorata Share of the actual Real Estate Taxes and Operating
Expenses for the period covered by the Statements are less than the estimated
installments which the Tenant previously paid during the calendar year just
completed, Landlord may at its option either refund said amount to Tenant or
credit the difference against the Tenant's estimated reimbursement for such Real
Estate Taxes and Operating Expenses for the current year. In addition, with
respect to the monthly reimbursement, until the Tenant receives such statement,
the Tenant's monthly reimbursement for the new calendar year shall continue to
be paid at the then current rate, but the Tenant shall commence payment to
Landlord of the monthly installments of reimbursement on the basis of the
statement beginning on the first day of the month following the month in which
▇▇▇▇▇▇ receives such statement.
The Tenant's obligation with respect to its Prorata Share of the Real
Estate Taxes and Operating Expenses shall survive the expiration or early
termination of this Lease and Landlord shall have the right to retain the
Security Deposit, or so much thereof as it deems necessary, to secure payment of
the Tenant's Prorata Share of the actual Real Estate Taxes and Operating
Expenses for the portion of the final calendar year of the Lease during which
the Tenant was obligated to pay such expenses. If the Tenant occupies Premises
for less than a full calendar year during the first or last calendar years of
the term hereof, the Tenant's Prorata Share for such partial year shall be
calculated by proportionately reducing the Real Estate Taxes and Operating
Expenses to reflect the number of days in such year during which Tenant occupied
Premises. The Tenant shall pay its Prorata Share of any such amounts within
thirty (30) days following receipt of notice thereof.
The Tenant shall have the right but not more than twice per annum, at
any time within thirty-six (36) months after a statement of actual Real Estate
Taxes and Operating Expenses for a particular calendar year has been rendered by
Landlord as provided herein, at Tenant's sole cost and expense, to examine
▇▇▇▇▇▇▇▇'s books and records during normal business hours, at Landlord's office
relating to the determination of such Real Estate Taxes and Operating Expenses.
Unless Tenant objects to the statement provided by Landlord, within said forty-
five (45) day period, such statement and adjustment shall be deemed conclusive.
If the audit discloses that Landlord overstated the Real Estate Taxes and
Operating Expenses by five percent (5%) or more then Landlord shall reimburse
Tenant for the reasonable costs of the audit.
4.3 Reimbursement Survives Termination. In the event of the termination
----------------------------------
of this Lease by expiration of the stated term or for any other cause or reason
whatsoever prior to the determination of rental adjustment as hereinafter set
forth, the Tenant's agreement to reimburse Landlord up to the time of
termination shall survive termination of the Lease and the Tenant shall pay any
amount due to Landlord within thirty (30) days after being billed therefor. In
the event of the termination of this Lease by expiration of the stated term or
for any other cause or reason whatsoever, except default by the Tenant of any of
the terms or provisions of this Lease, prior to the determination of rental
7
adjustments as hereinabove set forth, Landlord's agreement to refund any excess
additional rental paid by the Tenant up to the time of termination shall survive
termination of the Lease and Landlord shall pay the amount due to the Tenant
within thirty (30) days of Landlord's determination of such amount, but in no
event later than April 30 of the calendar year following the year of
termination. This covenant shall survive the expiration or termination of this
Lease.
If the last year of the term of this Lease ends on any day other than
the last day of December, any payment of Real Estate Taxes and Operating Costs
due to Landlord shall be prorated on the basis by which the number of days in
such partial year bears to 365.
Any failure of Landlord to furnish Tenant with an estimate of its
Prorata Share of Real Estate Taxes and Operating Expenses or any statements as
set forth in this Section 4 shall not act to relieve Tenant of its liability
therefor; and with respect to any deficiencies, ▇▇▇▇▇▇ agrees to pay same within
thirty (30) days of written demand from Landlord.
4.4 Direct Payment. Provided Tenant is not in default hereunder and
--------------
further provided that Landlord under any mortgage or deed of trust has no escrow
requirement for taxes and/or insurance, then Tenant may, upon written notice to
Landlord given thirty (30) days prior to the expiration of any calendar year,
elect to pay Real Estate Taxes and Landlord's insurance for the following
calendar year directly when due (see example below). Evidence of such payments
shall be delivered to Landlord within ten (10) business days of the earlier of
the date payment was made or the date due. Failure to make such payments when
due shall be deemed an event of default. Tenant shall be fully liable for all
penalties, interest or other damages arising or related to such failure to pay.
If Landlord is required to escrow funds for Real Estate Taxes and Landlord's
insurance then the monthly installment of funds (allocable to Real Estate Taxes
and Landlord's insurance) received by Landlord from Tenant will be put into an
interest-bearing account, interest to accrue for Tenant, to be paid annually.
For example, notice for payment of Real Estate Taxes for calendar year 1997, due
and payable in 1998, Tenant would give notice of its election to pay taxes
directly on or before December 1, 1997. In such event Landlord would not collect
for Real Estate Taxes during calendar year 1998.
ARTICLE V
BUILDING SERVICES
-----------------
5.1 Standard Services. [INTENTIONALLY DELETED.]
-----------------
5.2 Interruption of Services. Tenant agrees that Landlord shall not be
------------------------
liable for failure to supply any heating, air conditioning ("HVAC") during any
period when Landlord uses reasonable diligence to restore or to supply such
services, it being further agreed that Landlord reserves the right to
temporarily discontinue such service or any electric current at such times as
may be necessary by reason of accident, repairs, alterations, or improvements,
or whenever by reason of strikes, lockouts, riots, acts of God or any other
happening or occurrence beyond the reasonable control of Landlord. If Landlord
is unable to furnish such service, Landlord shall not be liable for damages to
persons or property for any such discontinuance, nor shall such discontinuance
in any way be construed as a constructive or actual eviction of Tenant or cause
an abatement of rent or operate to release Tenant from any of Tenant's
obligations hereunder. Landlord's obligation to furnish HVAC service shall be
conditioned upon the availability of adequate energy sources from the public
utility companies presently serving Building Complex. Tenant shall comply with
any laws or governmental regulations to reduce heating, cooling or lighting
required by mandatory energy-saving program. Furthermore, due to energy code
design requirements as promulgated from time to time, Tenant hereby acknowledges
8
that it may on certain days experience discomfort with the heating and air
conditioning cycle due to abnormal weather conditions, and Landlord shall have
no responsibility or liability therefor.
5.3 Services Paid by Tenant. Tenant shall separately arrange with the
-----------------------
applicable local public authorities or utilities, as the case may be, for the
furnishing of and payment for all utilities including telephone services as may
be required by Tenant in the use of Premises. Tenant shall directly pay for such
utilities, including the establishment and connection of all telephone services,
at the rates charged for such services by said authority or utility, and the
failure of Tenant to obtain or to continue to receive such services for any
reason whatsoever shall not relieve Tenant of any of its obligations under this
Lease.
5.4 HVAC Requirements. If heat-generating machines or equipment,
-----------------
including telephone equipment, cause the temperature in Premises, or any part
thereof, to exceed the temperatures Building's air conditioning system were
designed to meet pursuant to the specifications Tenant gave to Landlord prior to
construction, then to the extent that Tenant has changed the use or demands for
which the system was designed, Tenant may either, at Tenant's expense, subject
to the provisions of Article XV, install additional HVAC or Tenant shall reduce
its demands to the level for which the HVAC system was designed.
Tenant shall not, without the written consent of Landlord which shall
not be unreasonably withheld provided Tenant complies with the provisions of
Article XV, connect with electric current (except through existing electrical
outlets in Building) or water pipes any apparatus or device for the purposes of
using electric current, other energy or water.
5.5 Cleaning. Subject to the prior written approval of the Landlord,
--------
Tenant shall provide at its own expense janitorial or cleaning services for the
Building. ▇▇▇▇▇▇▇▇'s written consent shall not be unreasonably withheld or
delayed.
5.6 Re-▇▇▇▇▇▇▇. [INTENTIONALLY DELETED.]
----------
5.7 Maintenance by Landlord. Subject to casualty, ▇▇▇▇▇▇▇▇ agrees to
-----------------------
keep and maintain in good condition and repair that portion of the Building
Complex shown on Exhibit A which is not designated as the Tenant's Usable
Premises (as defined in Article XV), the roof and structural portions of the
Building Complex. All such costs may be included as "Operating Expenses" to the
extent provided in Article IV hereof. Furthermore, ▇▇▇▇▇▇▇▇ agrees at its own
cost and expense (without reimbursement by ▇▇▇▇▇▇) to maintain the integrity of
the structural components of the Building and to replace the roof, if and when
such replacement is necessary.
ARTICLE VI
TENANT REPAIR
-------------
6.1 Damage by Tenant. Subject to section 10.3 hereof, if Building
----------------
Complex or any portion thereof including but not limited to the elevators,
boilers, engines, pipes and other apparatus, or members of elements of Building
(or any of them) used for the purpose of climate control of Building or
operating the elevators, or if the water pipes, drainage pipes, electric
lighting or other equipment of Building or the roof or outside walls of Building
or parking facilities and also the Tenant Finish including but not limited to
the carpet, wall covering, doors and woodwork, become damaged or are destroyed
through the negligence, carelessness or misuse of the Tenant, its servants,
agents, employees or anyone permitted by Tenant to be in Building, or through it
or them, then the cost of the necessary repairs, replacements or alterations
shall be borne by the Tenant as an Operating Expense. Landlord shall have the
exclusive right, but not the obligation, to make any repairs necessitated by
such damage.
9
6.2 Maintenance. Tenant shall keep the Usable Premises in as good order,
-----------
condition and repair as when they were entered upon, reasonable wear and tear
for normal office use excepted and loss by casualty pursuant to Article XXI
excepted. If Tenant fails to keep the Usable Premises in such good order,
condition and repair as required hereunder to the satisfaction of Landlord,
Landlord may restore the Usable Premises to such good order and condition and
make such repairs without liability to Tenant for any loss or damage that may
accrue to Tenant's property or business by reason thereof, and upon completion
thereof, Tenant shall pay to Landlord, as Additional Rent, upon demand, the cost
of restoring the Usable Premises to such good order and condition and of the
making of the repairs.
6.3 Good Condition. [INTENTIONALLY DELETED.]
--------------
6.4 Surrender. Except as set forth in Article XXI, Tenant shall deliver,
---------
at the expiration of the Term hereof or upon sooner termination of the Term,
Premises in good repair as aforesaid reasonable wear and tear excepted and in a
clean and orderly condition including all waste removed and floors vacuumed.
6.5 Broken Glass. Tenant shall pay on demand the cost of replacement
------------
with identical quality, size and characteristics of glass broken on Premises,
including outside windows and doors of the perimeter of Premises (including
perimeter windows in the exterior walls) during the continuance of this Lease,
unless the glass shall be broken by Landlord, its servants, employees or agents
acting on its behalf.
ARTICLE VII
ASSIGNMENT AND SUBLETTING
-------------------------
7.1 Limitations. Tenant shall not assign or in any manner transfer this
-----------
Lease or any estate or interest therein or sublet Premises or any part thereof,
or grant any license, concession or other right to occupy any portion of
Premises without the prior written consent of Landlord as set forth herein.
Landlord shall not unreasonably withhold consent to any subletting or assignment
provided Tenant requests such consent in writing at least fifteen (15) days
prior to the proposed assignment or subletting and (i) Tenant is not in default
of this Lease as "default" is set forth in Section 24.1 hereof, unless Tenant
fully cures the default prior to such assignment or subletting and Landlord has
not terminated the Lease or commenced any legal proceeding arising from the
default (ii) the use of the Premises to be made by the assignee or subtenant is
within the uses permitted by this lease, (iii) the proposed sublessee or
assignee has a good business reputation, (iv) Tenant submits audited current
financials (or such other financial information as is available) for such
sublessee or assignee, and (v) Tenant submits the form of assignment or sublease
for Landlord's prior reasonable review and approval. In no event shall Tenant
have any right to sublet or assign if there exists any default under this Lease
as "default" is set forth in Article XXV hereof. Consent by Landlord to one or
more assignments of this Lease or to one or more sublettings of Premises shall
not operate as a waiver of Landlord's rights under this section. Any such
assignment or subletting without ▇▇▇▇▇▇▇▇'s consent shall be deemed void and
confer no rights upon a third party. Notwithstanding any assignment or
subletting, Tenant and any guarantor of Tenant's obligations under this Lease
shall at all times remain fully responsible and liable for the payment of the
rental herein specified and for compliance with all other terms and conditions
of this Lease.
Notwithstanding the above provisions, Tenant may sublet or assign this
Lease in accordance with the provisions of this Article VII even if Tenant is in
10
default hereunder if (i) the default is nonmonetary and it is impossible to cure
the default, and Landlord has not elected to terminate the Lease by reason of
such default or otherwise exercise its legal remedies arising from such default
or (ii) Tenant prior to Landlord terminating this Lease submits to Landlord a
subtenant or assignee willing to sublet or take an assignment of the balance of
the lease term of the Premises on the same terms as the Lease, and such
subtenant or assignee is otherwise acceptable pursuant to the terms hereof.
Nothing herein shall (adversely to Tenant's interest) affect Landlord's
obligation to mitigate damages as set forth in subsection 24.2 hereof.
Tenant may, without Landlord's prior written consent and without any
participation by Landlord in assignment and subletting proceeds, sublet the
Premises or assign the Lease to: (i) a subsidiary, affiliate, division or
corporation controlled or under common control with Tenant; (ii) a successor
corporation related to Tenant by merger, consolidation, nonbankruptcy
reorganization, or government action; (iii) a purchaser of substantially all of
Tenant's assets located in the Premises (collectively, Permitted Assignees").
Tenant acknowledges warrants and agrees that the Permitted Assignee shall assume
all liabilities and obligations of Tenant under the Lease. Tenant shall notify
Landlord of all Permitted Assignee(s) within thirty (30) days of such assignment
or subletting. For the purpose of this Lease, sale or transfer of Tenant's
capital stock, including without limitation, a transfer in reorganization of
Tenant and any sale through any public exchange, shall not be deemed an
assignment, subletting, or any other transfer of the Lease or the Premises,
provided that the surviving entity in such transfer assumes the Lease by
operation of law.
7.2 Acceptance of Performance. If this Lease be assigned or if Premises
-------------------------
or any part thereof be sublet or occupied by anybody other than Tenant, Landlord
may, after default by ▇▇▇▇▇▇, collect the rent from the assignee, subtenant or
occupant and apply the net amount collected to the rent herein reserved
retaining the remainder, if any, for the account of Landlord, but no such
assignment, subletting, occupancy or collection shall be deemed an acceptance of
the assignee, subtenant or occupant as the Tenant hereof, or constitute a
release of Tenant from further performance by Tenant of the covenants on the
part of Tenant herein contained.
7.3 Document Review. All documents utilized by Tenant to evidence any
---------------
subletting or assignment for which ▇▇▇▇▇▇▇▇'s consent has been requested, shall
be subject to prior approval by Landlord, which approval shall not be
unreasonably withheld or delayed.
ARTICLE VIII
TRANSFER BY LANDLORD AND LIMITED LIABILITY
------------------------------------------
8.1 Transfer of Landlord's Interest. In the event of a sale, conveyance,
-------------------------------
or assignment by Landlord of Landlord's interest in Building Complex (other than
a transfer for security purposes only), Landlord shall be relieved from all of
Landlord's obligations and liabilities accruing on the part of Landlord after
the date specified in any such notice of transfer or assignment, and ▇▇▇▇▇▇
agrees to look only toward such assignee or transferee of ▇▇▇▇▇▇▇▇'s interest.
If Landlord sells or otherwise conveys its interest in the Premises, Landlord
shall not be relieved of its obligation under this Lease until it has
transferred or credited any prepaid rent of Tenant to Landlord's successor and
its successor assumes in writing the obligations to be performed by ▇▇▇▇▇▇▇▇ in
and after the effective date of transfer.
8.2 Limited Liability of Landlord. Anything contained in this Lease to
-----------------------------
the contrary notwithstanding, ▇▇▇▇▇▇ agrees that Tenant shall look solely to the
11
estate of Landlord in Building Complex and any insurance proceeds collected by
Landlord in conjunction with such claim of Tenant, for the collection of any
judgment (or other judicial process) requiring the payment of money by Landlord
in the event of any default or breach by Landlord with respect to any of the
terms and provisions of this Lease to be observed or performed by Landlord,
subject, however, to the prior rights of the holder of any mortgage covering
Building Complex, and no other assets of Landlord, its agents, employees or
officers, shall be subject to levy, execution or other judicial process for the
satisfaction of ▇▇▇▇▇▇'s claim and Landlord shall not be liable for any such
default or breach except to the extent of Landlord's estate in Building Complex.
8.3 Pre-Construction Date Liability. Notwithstanding the above, prior to
-------------------------------
the Commencement Date, in the event of any default or breach of Landlord not
cured within any applicable cure period, if the estate of Landlord in Building
Complex and insurance proceeds (to the extent applicable) are less than Tenant's
damages sustained by such breach or default of Landlord, then Tenant may look to
Landlord for recovery of damages against the amount of development fees received
to date by Landlord under the Construction Loan. As of the Commencement Date
this Section 8.3 shall terminate and be of no further force and effect.
ARTICLE IX
USE OF PREMISES
---------------
9.1 Use. Except as expressly permitted by prior written consent of the
---
Landlord, Premises shall not be used other than for general office purposes or
such other purposes permitted by zoning and permitted by any restrictive
covenants. Such uses must be consistent with the design specifications for the
Building and shall not use, dispose of, create emissions, store or generate any
hazardous, toxic, infectious or other substance(s) or emission regulated by any
law or in violation of law, ordinance, rule or regulation including all laws
pertaining to the environment (the "Law") except for de minimis amounts which
are not in violation of the Law and consistent with general office use. All use
of Premises shall comply with the terms of this Lease and all applicable laws,
ordinances, regulations or other governmental ordinances from time to time in
existence.
9.2 Compliance with Rules and Regulations. Tenant and employees and all
-------------------------------------
persons visiting or doing business with the Tenant in Premises shall be bound by
and shall observe the reasonable Rules and Regulations as set forth in Exhibit
F, attached hereto and made a part hereof, which may, at Landlord's reasonable
discretion, be promulgated, amended, or expanded from time to time during Term
by the Landlord relating to Building, Building Complex and/or Premises of which
notice in writing shall be given to the Tenant within thirty (30) days of such
clause at which time they will become effective and all such rules and
regulations as changed from time to time shall be deemed to be incorporated into
and form a part of this Lease. Any default in the performance or observance of
such rules and regulations shall be a default hereunder and Landlord shall have
all remedies provided for in this Lease in the event of default by Tenant.
Landlord shall not be responsible to Tenant for nonobservance by any other
tenant or person of any tenant or person of any such rules and regulations.
12
ARTICLE X
INSURANCE
---------
10.1 Tenant's Insurance. Tenant shall, during the entire term hereof, at
------------------
its sole cost and expense, obtain, maintain and keep in full force and effect,
and with the Tenant, the Landlord and its mortgagees of the Landlord named as
beneficiaries additional insured therein as their respective interests may
appear, the following types and kinds of insurance:
(a) Upon property of every description and kind owned by the Tenant and
located in Building Complex or for which the Tenant is legally liable or
installed by or on behalf of the Tenant, including, without limitation,
furniture, fittings, installations, alterations, additions, partitions, fixtures
and anything in the nature of a leasehold improvement in an amount not less than
the full replacement cost thereof, with a minimum coverage including sprinkler
leakage (where applicable).
(b) Commercial general liability including bodily liability, property
damage and public liability insurance including personal liability, contractual
liability, non-owned automobile liability, tenants' legal liability for the full
replacement costs of Premises, and owners' and contractors' protective insurance
coverage and a cross-liability clause with respect to the Tenant's use of any
part of the Premises and which coverage shall include the business operations
conducted by the Tenant and any other persons on Premises. Such policies shall
be written on a comprehensive basis with limits of not less than $3,000,000.00
with respect to injuries or death of one or more persons, and not less than
$1,000,000.00 with respect to property damage and not less than $2,000,000.00
for any one occurrence and such higher limits as the Landlord or the mortgagees
of the Landlord may reasonably require from time to time. Deductibles are not to
exceed $5,000.00.
(c) Any other form or forms of insurance as the Landlord or the
mortgagees of the Landlord may reasonably require from time to time in form, in
amounts and for insurance risks against which a prudent tenant would protect
itself, which are commonly carried by landlords of similar properties.
(d) If Tenant performs any work on Premises, prior to the commencement
of any such work, Tenant shall deliver to Landlord certificates issued by
insurance companies qualified to do business in the State of Colorado,
evidencing that workmen's compensation and public liability insurance and
property damage insurance, all in amounts reasonably satisfactory to Landlord,
are in force and effect and maintained by all contractors and subcontractors
engaged by Tenant to perform such work.
All policies shall be primary and non-contributory and taken out with
insurers reasonably acceptable to the Landlord and in form reasonably
satisfactory from time to time to the Landlord. All policies shall be with
insurers that have a Best Rating of "A" or better. The Tenant agrees that
certificates of insurance, or, if required by the Landlord or the mortgagees of
the Landlord, certified copies of each such insurance policies will be delivered
to the Landlord, if policies are required by Landlord's mortgagee or if not so
required then Tenant will deliver certificates of insurance, as soon as
practicable after the placing of the required insurance, but in no event later
than ten (10) days after Tenant takes possession of all or any part of Premises.
To the extent copies of policies are required, then if such policies are blanket
policies then a binder together with a certified copy of the form of the policy
shall be delivered to Landlord. All policies shall contain an undertaking by the
insurers to notify the Landlord and the mortgagees of the Landlord in writing
not less than thirty (30) days prior to any material change, cancellation or
sooner termination thereof.
The Tenant covenants and agrees that in the event of damage or
destruction to the leasehold improvements in Premises covered by insurance as
13
required to be taken out by the Tenant herein, and if the Landlord or Tenant do
not terminate this Lease pursuant to Section 21.1 herein, the Tenant may use the
proceeds of such insurance for the purpose of repairing or restoring such
leasehold improvements which were paid by the Tenant. If Tenant elects not to
repair or restore, Landlord shall have no responsibility or liability therefor.
10.2 Landlord's Insurance. Landlord agrees to carry or cause to be
--------------------
carried during the term hereof public liability insurance on Building Complex
providing coverage of not less than Three Million and No/100 Dollars
($3,000,000.00) for personal injury or death arising out of any one occurrence.
▇▇▇▇▇▇▇▇ also agrees to carry during the term hereof insurance for fire,
extended coverage, vandalism and malicious mischief, insuring Building Complex
(excluding land, foundations, excavations and other non-insurable items) for the
full insurable value thereof. Landlord may, but shall not be obligated to, take
out and carry any other form or forms of insurance as it or the mortgagees of
Landlord may reasonably determine to be advisable. Notwithstanding any
contribution by Tenant to the cost of insurance premiums, as provided in Article
IV, Tenant acknowledges that it has no right to receive any proceeds from any
such insurance policies carried by Landlord, and that such insurance will be for
the sole benefit of Landlord, with no coverage for Tenant for any risk insured
against. Deductibles are not to exceed $1,000.00, unless requested or approved
by Tenant in which event such additional amount of deductible shall be included
as an Operating Expense. If Tenant requests a higher deductible materially in
excess of deductibles carried by other landlords of similar office buildings in
the County of Boulder, or in excess of the deductible permitted by Landlord's
lender for the Premises, then Landlord shall not be required to obtain such
higher deductible.
10.3 Subrogation. The parties hereto agree that any and all fire,
-----------
extended coverage and/or property damage insurance which is required to be
carried by either shall be endorsed with a subrogation clause, substantially as
follows: "This insurance shall not be invalidated should the insured waive, in
writing prior to a loss, any and all right of recovery against any party
including other parties to the Lease and persons under the insured's control,
its invitees or licensees for loss occurring to the property described therein";
and each party hereto waives all claims for recovery from the other party, its
officers, agents or employees for any loss or damage (whether or not such loss
or damage is caused by negligence of the other party), and notwithstanding any
provisions contained in this Lease to the contrary to any of its real or
personal property insured under valid and collectible insurance policies to the
extent of the collectible recovery under such insurance.
ARTICLE XI
OBSERVANCE OF LAW
-----------------
11.1 Law. Tenant shall comply with all provisions of law, including
---
without limitation, federal, state, county and city laws, ordinances and
regulations and any other governmental, quasi-governmental or municipal
regulations, which shall impose any duty upon Landlord or Tenant, and which
relate to the partitioning, equipment operation, alteration, occupancy and use
of Premises, and to the making of any repairs, replacements, alterations,
additions, changes, substitutions or improvements of or to Premises. Moreover,
Tenant shall comply with all police, fire and sanitary regulations imposed by
any federal, state, county or municipal authorities, or made by insurance
underwriters, and to observe and obey all governmental and municipal regulations
and other requirements governing the conduct of any business conducted in
Premises. Notwithstanding the above, Tenant shall have no responsibility for the
costs of remedying violations of laws pertaining to (i) the construction of the
14
Building Complex which violations were in existence as of the Commencement Date
of this Lease and (ii) any costs for remediation of hazardous substances in the
soil or groundwater except to the extent caused or contributed to by Tenant, its
agents, employees, invitees or contractors. Any costs incurred for such
compliance shall be borne by Landlord and shall not be included as Operating
Expenses.
11.2 Taxes. Tenant shall fully and timely pay all business and other
-----
taxes, charges, rates, duties, assessments and license fees levied, rates
imposed, charged or assessed against or in respect of the Tenant's occupancy of
Premises or in respect of the personal property, trade fixtures, furniture and
facilities of the Tenant or the business or income of the Tenant on and from
Premises, if any, as and when the same shall become due, and to indemnify and
hold Landlord harmless from and against all payment of such taxes, charges,
rates, duties, assessments and license fees and against all loss, costs, charges
and expenses occasioned by or arising from any and all such taxes, rates,
duties, assessments and license fees, and to promptly deliver to Landlord for
inspection, upon written request of the Landlord, evidence satisfactory to
Landlord of any such payments.
ARTICLE XII
WASTE AND NUISANCE
------------------
12.1 Tenant shall not commit, suffer or permit any waste or damage or
disfiguration or injury to Premises or the fixtures and equipment located
therein or thereon, or permit or suffer any overloading of the floors thereof
and shall not place therein any safe, heavy business machinery, computers, data
processing machines, or other heavy things without first obtaining the consent
in writing of the Landlord and, if requested, by ▇▇▇▇▇▇▇▇'s superintending
architect and Landlord's structural engineer, and not use or permit to be used
any part of Premises for any dangerous, noxious or offensive trade or business,
and shall not cause or permit any nuisance, noise or action in, at or on
Premises. Tenant shall not store, produce, maintain or dispose of any materials
or substances in or about Building Complex which are regulated, toxic, hazardous
or infectious material or substance under any environmental statute, rule,
regulation, or ordinance of any governmental authority, except for de minimis
amounts consistent with general office use, including janitorial which are at
all times in compliance with applicable law.
ARTICLE XIII
ENTRY BY LANDLORD
-----------------
13.1 Upon twenty-four (24) hour prior verbal notice to Tenant, Landlord
and its agents shall have the right to enter Premises at all reasonable times
for the purpose of examining or inspecting the same, and any other services to
be provided by Landlord to Tenant hereunder and to make such alterations,
repairs, improvements or additions, whether structural or otherwise, to Premises
as Landlord may deem necessary or desirable. In no event shall prior notice be
required if Landlord reasonably believes that there is an emergency. Landlord
may enter by means of a master key without liability to Tenant except for any
failure to exercise due care for Tenant's property and without affecting this
Lease. Landlord may show the Premises to prospective purchasers, investors or
lenders upon twenty-four (24) hour prior verbal notice to ▇▇▇▇▇▇. Tenant may
provide Landlord with an escort for any inspection.
15
ARTICLE XIV
INDEMNIFICATION
---------------
14.1 Tenant's Indemnity. Subject to the provisions of Section 10.3 of
------------------
this Lease and Section 14.3 below, Tenant shall indemnify the Landlord and save
it harmless from and against any and all loss (including loss of rentals payable
by the Tenant or other tenants in the event of loss either directly or
indirectly caused by any act or omission or Tenant), claims, actions, damages,
liability and expenses in connection with loss of life and personal injury
arising from any occurrence in, upon or at Premises during the term of this
Lease or any part thereof, or occasioned wholly or in part by any act or
omission of the Tenant, its agents, contractors, employees, servants, licensees,
or concessionaires or invitees or by anyone permitted to be on Premises by the
Tenant; however in no event shall Tenant indemnify Landlord or hold it harmless
from any negligence or misconduct of Landlord, its agents, employees or
contractors or Landlord's invitees. In case the Landlord shall be made a party
to any litigation commenced by or against the Tenant (except litigation where
the Tenant is seeking relief from or a remedy against Landlord, its agents,
employees, or contractors), then the Tenant shall protect and hold the Landlord
harmless and shall pay all costs, expenses and reasonable attorney's fees
incurred or paid by the Landlord in connection with such litigation whether or
not such action is contested or prosecuted to judgement. All personal property
on Premises shall be at the Tenant's sole risk, and Landlord shall not be liable
for any damage done to or loss of such personal property or for damage or loss
suffered by Tenant.
14.2 Landlord's Indemnity. Subject to the provisions of Section 10.3 and
--------------------
Section 14.3 below, Landlord shall indemnify and hold Tenant harmless from and
against any and all loss, claims, actions or damages, liability and expenses in
connection with loss of life and personal injury arising from any occurrence
occasioned wholly or in part by any act or omission of the Landlord, its agent,
employees or contractors, except as set forth herein, however in no event shall
Landlord indemnify Tenant or hold it harmless from any negligence of Tenant, its
agents, employees or contractors. If Landlord has any liability pursuant to
Article 23, then this indemnity shall apply to any claims or expenses of Tenant
arising in conjunction with such liability, however this indemnity shall not
change or increase Landlord's liability under Article 23.
14.3 Comparative Negligence. Subject to the provisions of Section 10.3
----------------------
but notwithstanding any indemnity provision or other provisions contained in
this Lease to the contrary, if both the Landlord's and the Tenant's negligence
(which shall include the agents, contractors, invitees and employees of either,
as applicable) caused or contributed to any claim for damages for injury to
person or property then neither party shall indemnify the other for such
negligence and each party shall be responsible for such claims pursuant to the
provisions of C.R.S. (S) ▇▇-▇▇-▇▇▇ pertaining to comparative negligence, as
amended from time to time.
ARTICLE XV
ALTERATIONS
-----------
15.1 Alterations by Tenant. Tenant may not make any alterations,
---------------------
additions or changes to the structural portions of the Premises, the exterior of
the Building or the exterior portion of the Building Complex, the roof, the
mechanical systems, HVAC, elevator or plumbing systems, without consent of
Landlord, which consent shall not be unreasonably withheld or delayed. The
balance of the Premises for which ▇▇▇▇▇▇▇▇'s consent is not required prior to
making such alterations is hereafter called the "Usable Premises". In no event
shall Landlord be deemed to be unreasonable in withholding consent if the
changes, additions, or alterations would directly, indirectly or potentially
cause Landlord to incur expenses or costs now or in the future which expenses or
costs would be borne by Landlord, unless ▇▇▇▇▇▇ agrees to bear such expenses.
16
Tenant shall not make, install or erect in or to the any other portion of the
Premises any installations, alterations, additions or partitions without
submitting the drawings and specifications to the Landlord and to the extent
such alteration which constitutes a single integrated work of improvement equals
or exceeds $25,000.00 in cost, Tenant shall first obtain the Landlord's prior
written consent in each instance, which consent shall not be unreasonably
withheld. Furthermore, the Tenant shall obtain the Landlord's prior written
consent to any change or changes in such drawings or specifications submitted as
aforesaid, subject to the payment of the cost to the Landlord of having its
architects and appropriate consulting engineers review such plans and changes
thereto prior to proceeding with any work based on such drawings or
specifications. All such work shall be performed free and clear of all
mechanic's liens and Landlord shall have no liability for the performance of
such work, notwithstanding its consent to any plans and specifications. All such
work shall be performed free and clear of all mechanic's liens and Landlord
shall have no liability for the performance of such work, notwithstanding its
consent to any plans and specifications. Any work performed by or for the Tenant
shall be performed by competent workmen whose labor union affiliations are not
incompatible with those of any workmen who may be employed in Building Complex
by the Landlord, its contractors or subcontractors. The Tenant covenants that
the Tenant will not suffer or permit during the Term hereof any mechanics' or
other liens for work, labor, services or materials ordered by the Tenant or for
the cost of which the Tenant may be in any obligated, to attach to Premises and
that whenever and so often as any such liens shall attach or claims therefor
shall be filed, the Tenant shall, within thirty (30) days after the Tenant has
notice of the claim for lien, procure the discharge thereof by payment or by
giving security or in such other manner as is or may be required or permitted by
law or which shall otherwise satisfy Landlord. The Tenant shall, at its own cost
and expense, take out or cause to be taken out any additional insurance or bonds
reasonably required by the Landlord to protect the Landlord's and the Tenant's
interest during the period of alteration. Tenant, at least twenty (20) days
prior to installation of any alteration and subsequent to review and approval of
any plans and specifications by Landlord, may request Landlord to advise Tenant
in writing whether Landlord reserves the right to require Tenant to remove any
Alterations from the Premises upon termination or expiration of the Lease which
notice shall be delivered to Tenant within fifteen (15) days of receipt of such
request from Tenant.
At least five (5) days prior to the commencement of any work permitted
to be done by persons requested by the Tenant on the Usable Premises, the Tenant
shall notify the Landlord of the proposed work and the names, addresses, phone
numbers, fax numbers and tax I.D. numbers of the persons supplying labor and
materials for the proposed work so that the Landlord may avail itself of the
provisions of statutes such as Section 38-22-105(2) of the Colorado Revised
Statutes (1982). During any such work on Premises, the Landlord, or its
representatives, shall have the right to go upon and inspect Premises at all
reasonable times, and shall have the right to post and keep posted thereon
notices such as those provided for by Section 38-22-105(2) C.R.S. (1982) or to
take any further action which the Landlord may deem to be proper for the
protection of the Landlord's interest in Premises.
15.2 Alterations by Landlord. Landlord hereby reserves the right at any
-----------------------
time and from time to time to make changes in, additions to, subtractions from
or rearrangements of the Building Complex (excluding the Building), at any time
thereof, all entrances and exits thereto, and to grant, modify and terminate
easements or other agreements pertaining to the use and maintenance of all or
parts of the Building Complex (excluding the Building), provided that Landlord
may not make any such alterations of the Building Complex or grant to third
parties any parking rights or exclusive rights to use the exterior portions of
the Building Complex or nonexclusive rights which impair Tenant's use of the
Premises in any material way.
17
ARTICLE XVI
SIGNS AND ADVERTISING
---------------------
16.1 Tenant shall not install, paint, display, inscribe, place or affix
any sign, picture, advertisements, notice, lettering or direction on any part of
Building Complex or in the interior of Building which is visible from the
exterior without Landlord's prior written consent. All signage must be in
compliance with zoning and applicable covenants and restrictions for the
Building Complex.
ARTICLE XVII
SUBORDINATION TO MORTGAGES AND DEEDS OF TRUST
---------------------------------------------
17.1 This Lease and the rights of Tenant hereunder shall be and are
hereby made subject and subordinate to the lien of any mortgages or deeds of
trust now or hereafter existing against Building Complex and to all renewals,
modifications, consolidations, replacements and extensions thereof and to all
advances made, or hereafter to be made, upon the security thereof, and Tenant
hereby attorns to the mortgagee , provided, however, (i) that ▇▇▇▇▇▇'s rights
under this Lease shall not be disturbed so long as there is no default by ▇▇▇▇▇▇
and (ii) that the mortgagee perform and fulfill all of the obligations of
Landlord under this Lease arising after the date that such mortgagee succeeds to
Landlord's interest. Although such subordination, attornment and nondisturbance
shall be self-operating, Tenant, or its successors in interest, shall upon
Landlord's request, execute and deliver upon the demand of Landlord any and all
reasonable subordination, attornment and nondisturbance instruments desired by
Landlord, in the manner reasonably requested by Landlord, subordinating this
Lease to any such mortgage or deed of trust and to which Tenant shall not
unreasonably withhold or delay its consent and execution thereof.
Should any mortgage or deed of trust affecting Building Complex be
foreclosed, then:
(a) the liability of the mortgagee, at such foreclosure sale shall exist
only so long as such mortgagee, is the owner of Building Complex and such
liability shall not continue or survive after further transfer of ownership; and
(b) this Lease shall continue in full force and effect as a direct lease
between and binding upon both the Tenant and mortgagee.
As used in this Article XVII, the terms "mortgagee" and "beneficiary"
shall include successors and assigns of any such party, whether immediate or
remote, the purchaser of any mortgage or deed of trust, whether at foreclosure
or otherwise, and the successors, assigns and mortgagees and beneficiaries of
such purchaser, whether immediate or remote.
In the event the parties are unable to agree upon the form of any
subordination, attornment and nondisturbance agreement or proposed language to
such form, then Landlord may elect to retain an independent third party Colorado
licensed attorney with at least ten (10) years prior institutional real estate
lending experience and experience representing both landlords and tenants in
Colorado and Tenant agrees that such attorney's opinion as to whether the form
and/or the proposed language is commercially reasonable shall be binding on
Tenant and Landlord cannot declare Tenant in default so long as Tenant complies
with the decision of such third party.
18
ARTICLE XVIII
ESTOPPEL CERTIFICATE/FINANCIAL INFORMATION
------------------------------------------
18.1 Initial Estoppel Certificate. Tenant agrees within five (5)
----------------------------
business days of receipt of written request to execute and deliver to Landlord
to and for the benefit of Landlord, any purchaser or lender the Initial Estoppel
Certificate attached hereto as Exhibit E. To the extent that any matter set
forth thereon is incorrect then Tenant shall specify in detail any such
inaccuracy.
18.2 Additional Estoppel Certificates. Tenant agrees that it will from
--------------------------------
time to time, upon request by ▇▇▇▇▇▇▇▇, execute and deliver to Landlord within
five (5) business days after demand therefor an estoppel certificate in
Landlord's form certifying that this Lease is unmodified and in full force and
effect (or if there have been modifications, that the same is in full force and
effect as so modified).
18.3 Financial Information. Tenant shall, from time to time at
---------------------
reasonable intervals upon Landlord's request, deliver to Landlord a copy of
Tenant's most recent audited Financial Statements, which statements shall be
requested by Landlord for the purposes of meeting any investor's, lender's or
prospective purchaser's request.
ARTICLE XIX
QUIET ENJOYMENT
---------------
19.1 Subject to the terms and provisions of this Lease, Landlord
covenants and agrees that Tenant shall peaceably and quietly enjoy Premises and
▇▇▇▇▇▇'s rights hereunder during the term hereof, without hindrance by Landlord,
its agents and employees.
ARTICLE XX
FIXTURES
--------
20.1 Any or all installations, alterations, additions, partitions and
fixtures which are affixed to or upon Premises, if placed there by the Landlord
or as an alteration made by the Tenant, shall, immediately upon such placement,
become the property of the Landlord without compensation therefor to the Tenant
to the extent that it is not personalty or trade fixtures owned by Tenant and is
characterized under applicable law as real property, including without
limitation carpets, walls, electrical and plumbing. Notwithstanding anything
herein contained, the Landlord shall be under no obligation to repair, maintain
or insure any installations, alterations, additions, partitions and fixtures or
anything in the nature of a leasehold improvement made or installed by the
Tenant. Subject to the provisions of Section 15.1, the Landlord may elect that
any or all installations made or installed by or on behalf of the Tenant be
removed at the end of Term (exclusive of the initial tenant improvements
installed prior to the Commencement Date) and, if the Landlord so elects, it
shall be the Tenant's obligation to restore Premises to the condition it was in
previous to such alterations, installations, partitions and fixtures on or
before the termination of this Lease. Such removal and restoration shall be at
the sole expense of the Tenant. Furthermore, all personal property, alterations
and trade fixtures installed and paid for by Tenant (Tenant's Property) shall at
all times remain Tenant's property, shall be insured by Tenant, and Tenant shall
be entitled to all depreciation, amortization and other tax benefits with
respect thereto. Tenant may from time to time remove any personal property or
trade fixtures which were installed and/or paid for by ▇▇▇▇▇▇ provided Tenant
19
repairs all damage to the Building Complex caused by such removal. Provided
Tenant is not in default hereunder, ▇▇▇▇▇▇▇▇ agrees to execute within fifteen
(15) business days of receipt a landlord lien waiver, in form satisfactory to
Landlord, waiving any lien of Landlord in Tenant's personal property., trade
fixtures and other alterations installed and paid for by Tenant which do not
become Landlord's property upon expiration or termination of the Lease.
ARTICLE XXI
DAMAGE OR DESTRUCTION
---------------------
21.1 Casualty. In the event that Building should be totally destroyed by
--------
fire, tornado or other casualty, or should be so damaged that rebuilding or
repairs cannot be completed within nine months from issuance of building
permit(s) after the date of such damage, Landlord or Tenant may, at its option,
terminate this Lease in which event the rent shall be abated during the
unexpired portion of this Lease effective with the date of such damage, or
Landlord may proceed to rebuild Building and Premises. In the event Building
should be damaged by fire, tornado or other casualty, but only to such extent
that rebuilding or repairs in Landlord's reasonable estimation can be completed
within nine months of issuance of building permit(s) after the date of such
damage, or if the damage cannot be repaired within such time frame but neither
Tenant nor Landlord elect to terminate this Lease, in either such event,
Landlord shall, within ninety (90) days after the date of such damage commence
to rebuild or repair Building and shall proceed with reasonable diligence to
restore Building to substantially the same condition in which it was immediately
prior to the happening of the casualty, except that the Landlord shall not be
required to rebuild, repair or replace any part of the partitions, fixtures and
other improvements which may have been placed by the Tenant within Building. In
the event any mortgagee under a deed of trust, security agreement or mortgage on
Building should require that the insurance proceeds be used to retire the
mortgage debt (notwithstanding Landlord's reasonable efforts to obtain the right
to use proceeds to rebuild) then Landlord shall have no obligation to rebuild
and if Landlord so elects, this Lease shall terminate upon notice to Tenant.
Unless otherwise provided in this Lease, any insurance which may be carried by
the Landlord or the Tenant against loss or damage to the Building Complex shall
be for the sole benefit of the party carrying such insurance and under its sole
control. Furthermore, if the casualty occurs during the last twenty-four (24)
months of the Lease Term and any damage cannot be repaired within 180 days or
alternatively if upon completion of the repair there would be less one hundred
and eighty (180) days remaining in the Lease Term then, Tenant may within ten
(10) days of receipt of written notice from Landlord of Landlord's election to
repair, terminate this Lease by written notice to Landlord.
21.2 Casualty Caused by Tenant. [INTENTIONALLY DELETED.]
-------------------------
ARTICLE XXII
CONDEMNATION
------------
22.1 Eminent Domain. If all or any part of the Building is taken by
--------------
eminent domain, or by conveyance in lieu thereof or if a portion of the total
parking is taken by eminent domain resulting in a zoning violation and no
reasonable alternative parking is made available, then this Lease, at the option
of either party evidenced by notice to the other given within thirty (30) days
from such taking or conveyance, shall forthwith cease and terminate entirely. In
the event of such termination of this Lease, then rental shall be due and
payable to the actual date of such termination. If this Lease does not otherwise
terminate, this Lease shall cease and terminate as to that portion of Premises
so taken as of the date of such taking, and the rental thereafter payable under
20
this Lease shall be abated pro rata from the date of such taking in an amount by
which that portion of Gross Area of Premises so taken shall bear to Gross Area
of Premises prior to such taking. If any part of Building Complex shall be taken
by eminent domain, or by conveyance in lieu thereof, and if such taking
substantially interferes with the Landlord's ownership or use of Building
Complex, the Landlord, at its option, may upon thirty (30) days' notice to the
Tenant, terminate this Lease as of the date of such taking.
22.2 Damages. All compensation awarded for any taking (or the proceeds
-------
of private sale in lieu thereof) of Premises shall be the property of Landlord
and Tenant hereby assigns its interest in any such award to Landlord; provided,
however, Landlord shall have no interest in any award made to Tenant for the
taking of Tenant's fixtures and other personal property or moving expenses if a
separate award for such items is made to Tenant.
22.3 Restoration. If both Landlord and Tenant elect not to terminate
-----------
this Lease, Tenant shall remain in that portion of Premises which shall not have
been appropriated or taken as herein provided, and Landlord agrees, at
Landlord's sole cost and expense, to, as soon as reasonably possible, restore
the remaining portion of Premises to a complete unit of like quality and
character as existed prior to such appropriation or taking.
ARTICLE XXIII
LOSS AND DAMAGE AND DELAY
-------------------------
23.1 Loss and Damage. The Landlord shall not be liable or responsible in
---------------
any way for:
(a) any death or injury arising from or out of any occurrence in, upon
or at Building Complex or for damage to property of the Tenant or others located
on Premises, nor shall it be responsible in any event for damage to any property
of the Tenant or others from any cause whatsoever, except to the extent such
damage, loss, injury or death results from the intentional misconduct or
negligence of the Landlord, its agents, servants or employees. Without limiting
the generality of the foregoing, the Landlord shall not be liable for any injury
or damage to persons or property resulting from fire, explosion, falling
plaster, steam, gas, electricity, water, rain, snow or leaks from any part of
Premises or from the pipes, appliances, plumbing works, roof, street, or
subsurface of any floor or ceiling or from any other place or because of
dampness or climatic conditions from any other cause of whatsoever kind. The
Landlord shall not be liable for any damage whatsoever caused by any other
persons in or about Building Complex, or by an occupant of adjacent property
thereto, or the public, or construction of any private, public or quasi-public
work. All property of the Tenant kept or stored on Premises shall be kept or
stored at the risk of the Tenant only and the Tenant shall indemnify the
Landlord in the event of any claims arising out of damages to the same,
including any subrogation claim by the Tenant's insurers;
(b) loss or damage, however caused, to money, securities, negotiable
instruments, papers or other valuables of the Tenant.
23.2 Delays. Whenever and to the extent that the Landlord or Tenant
------
(except for nonpayment of any sums due Landlord from Tenant) shall be unable to
fulfill, or shall be delayed or restricted in the fulfillment of, any obligation
hereunder in respect to the supply of or provision for, any service or utility
or the doing of any work or the making of any repairs by reason of being unable
to obtain the material, goods, equipment, service, utility or labor required to
enable it to fulfill such obligation or by reason of any statute, law or any
regulation or order passed or made pursuant thereto or by reason of the order or
direction of any administrator, controller or board, or any governmental
21
department or officer or other authority, or by reason of not being able to
obtain any permission or authority required thereby, or by reason of any other
cause beyond its control (other than financial inability), whether of the
foregoing character or not, the Landlord or Tenant, as applicable, shall be
entitled to extend the time for fulfillment of such obligation by a time equal
to the duration of such delay or restriction, and the Tenant shall not be
entitled to compensation for any inconvenience, nuisance or discomfort thereby
occasioned.
ARTICLE XXIV
DEFAULT AND REMEDIES
--------------------
24.1 Default by Tenant. The following events shall be deemed to be
-----------------
events of default by Tenant under this Lease:
(a) Tenant shall fail to pay any installment of rent or any other sum
due to Landlord as herein provided and such failure shall continue for a period
of five (5) days after receipt of written notice thereof to Tenant.
(b) Tenant shall fail to comply with any term, provision or covenant of
this Lease, other than payment of rent or other sums due to Landlord, and shall
not cure such failure within thirty (30) days after written notice thereof to
Tenant. However to the extent that such covenants cannot reasonably be cured
within thirty (30) days then Tenant shall not be deemed in default if it has
commenced to cure such default within thirty (30) days and is diligently
prosecuting same to completion.
(c) Tenant or any guarantor of Tenant's obligations under this Lease
shall die, cease to exist as a corporation or partnership (except as expressly
permitted pursuant to Article VII), or be otherwise dissolved or liquidated, or
shall make a transfer in fraud of creditors, or shall make an assignment for the
benefit of creditors.
(d) Unless discharged within sixty (60) days, Tenant or any guarantor of
Tenant's obligations under this Lease shall file a petition under any section or
chapter of the national bankruptcy act as amended or under any similar law or
statute of the United States or any state thereof; or Tenant or any guarantor of
Tenant's obligations under this Lease shall be adjudged bankrupt or insolvent in
proceedings filed against Tenant or any guarantor of Tenant's obligations under
this Lease.
(e) Unless removed within sixty (60) days, a receiver or trustee shall
be appointed for all of Premises or for all or substantially all of the assets
of Tenant or any guarantor of Tenant's obligations under this Lease.
(f) Tenant shall abandon or vacate any portion of Premises, in whole or
in part in violation of Section 33.3 hereof.
24.2 Remedies of Landlord. Upon the occurrence of any such events of
--------------------
default as set forth in Section 24.1, Landlord shall have the option to pursue
any one or more of the following remedies without any notice or demand
whatsoever:
(a) Terminate this Lease, in which event Tenant shall immediately
surrender Premises to Landlord, and if Tenant fails to do so, Landlord may,
without prejudice to any other remedy which it may have for possession or
arrearages in rent, enter upon and take possession of Premises and expel or
remove Tenant and any other person who may be occupying such Premises or any
part thereof, by force if necessary, without being liable for prosecution of any
claim of damages therefor.
(b) Enter upon and take possession of Premises and expel or remove
Tenant and any other person who may be occupying such Premises or any part
22
thereof, by force if necessary, without being liable for prosecution or any
claim for damages therefor, and relet Premises and receive the rent therefor.
(c) Enter upon Premises, by force if necessary, without being liable for
prosecution or any claim for damages therefor, and do whatever Tenant is
obligated to do under the terms of this Lease; and ▇▇▇▇▇▇ agrees to reimburse
Landlord on demand for any expenses which Landlord may incur in thus effecting
compliance with ▇▇▇▇▇▇'s obligations under this Lease, and ▇▇▇▇▇▇ further agrees
that Landlord shall not be liable for any damages resulting to the Tenant from
such action, whether caused by the negligence of Landlord or otherwise.
(d) Alter all locks and other security devices at Premises without
terminating this Lease.
Exercise by Landlord of any one or more of the remedies hereunder
granted or otherwise available shall not be deemed to be an acceptance of
surrender of Premises by ▇▇▇▇▇▇, whether by agreement or by operation of law, it
being understood that such surrender can be effected only by the written
agreement of Landlord and ▇▇▇▇▇▇. No such alteration of locks or other security
devices and no removal or other exercise of dominion by Landlord over the
property of Tenant or others at Premises shall be deemed unauthorized or
constitute a conversion, Tenant hereby consenting, after any event of default,
to the aforesaid exercise of dominion over Tenant's property within Premises.
All claims for damages by reason of such reentry and/or repossession and/or
alteration of locks or other security devices are hereby waived, as all claims
for damages by reason of any distress warrant, forcible detainer proceedings,
sequestration proceedings or other legal process, to the extent permitted by
law. ▇▇▇▇▇▇ agrees that any reentry by Landlord may be pursuant to judgment
obtained in forcible detainer proceedings or other legal proceedings or without
the necessity for any legal proceedings, as Landlord may elect, and Landlord
shall not be liable in trespass or otherwise.
In the event Landlord elects to terminate the Lease by reason of an
event of default then notwithstanding such termination, Tenant shall be liable
for and shall pay to Landlord, at the address specified for notice to Landlord
herein, the sum of (i) all rental and other indebtedness accrued to date of such
termination, plus, as damages, (ii) an amount equal to the total rental
hereunder for the remaining portion of Term (had such term not been terminated
by Landlord prior to the date of expiration as stated herein) less reasonable
rental value, reduced to then present value based upon the discount rate of the
Federal Reserve Bank of San Francisco, California, plus one percent. Such sum
shall accrue interest at the rate for late payments, until paid.
In the event that Landlord elects to repossess Premises without
terminating the Lease, then Tenant shall be liable for and shall pay to Landlord
at the address specified for notice to Landlord herein, all rental and other
indebtedness accrued to the date of such repossession, plus rent required to
paid by Tenant to Landlord during the remainder of Term until the date of
expiration of the term as stated herein diminished by any net sums thereafter
received by Landlord through reletting Premises during such period (after
deducting expenses incurred by Landlord as provided below). In no event shall
Tenant be entitled to any excess of any rental obtained by reletting over and
above the rental herein reserved. Actions to collect amounts due by Tenant to
Landlord under this subparagraph may be brought from time to time, on one or
more occasions, without the necessity of Landlord's waiting until expiration of
Term. In the event that Landlord relets the Premises without terminating the
Lease Tenant's liability for Base Rent and Additional Rent hereunder shall not
include any liability for the wrongful acts, breaches or indemnity of such
subsequent tenant other than nonpayment of Base Rent and Additional Rent
attributable to Operating Expenses and Real Estate Taxes.
23
In the event of any default or breach by Tenant, or threatened or
anticipatory breach or default, Tenant shall also be liable and shall pay to
Landlord, in addition to any sums provided to be paid above, broker's fees
incurred by Landlord in connection with reletting the whole or any part of
Premises; the costs of removing and storing Tenant's or other occupants'
property; the costs of repairing, altering, remodeling, or otherwise putting
Premises into condition acceptable to a new tenant or tenants; and all
reasonable expenses incurred by Landlord in enforcing or defending Landlord's
rights and/or remedies, including reasonable attorney's fees whether suit was
actually filed or not. In no event shall Tenant be liable for additional damages
(exclusive of rent) for any nonmonetary default arising by, through, or under
any tenant under any subsequent reletting including but not limited to damages
caused by hazardous materials generated by any subsequent tenant.
In the event of termination or repossession of Premises for an event of
default, Landlord shall not have any obligation (except set forth below) to
relet or attempt to relet Premises or any portion thereof, or to collect rental
after reletting; and in the event of reletting, Landlord may relet the whole or
any portion of Premises for any period to any Tenant and for any use or purpose.
Landlord shall use reasonable efforts to mitigate its damages, but Landlord
shall not be obligated to expend sums to lease the Premises nor required to
lease at below market rates.
If Tenant shall fail to make any payment or cure any default hereunder
within the time herein permitted, Landlord, without being under any obligation
to do so and without thereby waiving such default, may make such payment and/or
remedy such other default for the account of Tenant (and enter the Premises for
such purpose), and thereupon Tenant shall be obligated to, and hereby agrees to
pay Landlord upon demand all costs, expenses and disbursements, including
reasonable attorney's fees incurred by Landlord in taking such remedial action.
Landlord is entitled to accept, receive in cash or deposit any payment
made by Tenant for any reason or purpose or in any amount whatsoever, and apply
the same at Landlord's option to any obligation of Tenant and the same shall not
constitute payment of any amount owed except that to which Landlord has applied
the same. No endorsement or statement on any check or letter of Tenant shall be
deemed an accord and satisfaction or recognized for any purpose whatsoever. The
acceptance of any such check or payment shall be without prejudice to Landlord's
rights to recover any and all amounts owed by Tenant hereunder and shall not be
deemed to cure any other default nor prejudice Landlord's rights to pursue any
other available remedy. Nothing herein shall bar or limit ▇▇▇▇▇▇'s right to
submit evidence that ▇▇▇▇▇▇▇▇ failed to reasonably mitigate damages by not
attempting to relet the Premises or by not accepting a reasonable subletting or
assignment submitted by ▇▇▇▇▇▇.
24.3 Landlord's Default. Landlord shall not be deemed in default
------------------
hereunder unless Tenant shall have given Landlord written notice of such default
specifying such default with particularity and Landlord shall thereupon have
thirty (30) days in which to cure any default unless such default cannot
reasonably be cured within such period wherein Landlord shall not be in default
if it commences to cure the default within the thirty (30) day period and
diligently pursues completion of same. In the event of any default, ▇▇▇▇▇▇
agrees that its exclusive remedy shall be an action for damages.
24.4 Personal Property Lien.
----------------------
24
ARTICLE XXV
HOLDING OVER
------------
25.1 If the Tenant shall continue to occupy and continue to pay rent for
Premises after the expiration of this Lease with or without the consent of the
Landlord, and without any further written agreement, the Tenant shall be a
tenant from month to month at a monthly Base Rent equal to one hundred twenty-
five percent (125%) of the last full monthly Base Rent payment due hereunder,
and subject to all of the additional rentals, terms and conditions herein set
out except as to expiration of Term. Such holding over may be terminated by the
Landlord or the Tenant upon thirty (30) days' notice. In the event that the
Tenant fails to surrender Premises upon termination or expiration of this Lease
or such month to month tenancy, then the Tenant shall indemnify the Landlord
against loss or liability resulting from any delay of the Tenant in not
surrendering Premises, including, but not limited to, any amounts required to be
paid to third parties who were to have occupied Premises and any attorney's fees
related thereto.
ARTICLE XXVI
NOTICE
------
26.1 Notice. Any notice, request, statement or other writing pursuant to
------
this Lease shall be deemed to have been given if personally delivered, sent by
registered or certified mail, postage prepaid, return receipt requested or by
recognized overnight express receipted delivery service, or delivered by hand to
the party at the addresses set forth below;
TENANT: Cirrus Logic, Inc.
(PRIOR TO ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
DATE) Attn: ___________________
TENANT: Cirrus Logic, Inc.
(AS OF 305 Interlocken Parkway
COMMENCEMENT Broomfield, CO 80021
DATE AND Attn: ______________________
THEREAFTER)
LANDLORD: Prime West Development
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: President
▇▇▇▇ to: Director of Property
Management
and such notice shall be deemed to have been received by the Landlord or the
Tenant, as the case may be, on the date on which it shall have been so mailed
actually received.
26.2 Change of Address. Any party may, by notice to the other, from time
-----------------
to time, designate another address in the United States, which notices mailed
more than ten (10) days thereafter shall be addressed.
ARTICLE XXVII
SECURITY DEPOSIT
----------------
27.1 Tenant has deposited with Landlord the sum of (-0-) as security for
the performance by ▇▇▇▇▇▇ of all of the terms, covenants, and conditions
required to be performed by it hereunder. Such sum shall be returned to Tenant
after a reasonable period after the expiration of Term and delivery of
possession of the Premises to Landlord if, at such time, ▇▇▇▇▇▇ has fully
25
performed all such terms, covenants and conditions. Prior to the time when
▇▇▇▇▇▇ is entitled to the return of the security deposit, Landlord shall be
entitled to intermingle such deposit with its own funds and to use same for such
purposes as Landlord may determine. Tenant shall not be entitled to any interest
on the security deposit. In the event of default by ▇▇▇▇▇▇ in performing any of
its obligations under this Lease, Landlord may, in addition to any other right
or remedy available to Landlord hereunder, use, apply, or retain all or any part
of this security deposit for the payment of any unpaid rent or for any other
amount which Landlord may be required to expend by reason of the default of
Tenant, including any damages or deficiency in the reletting of the Premises or
any attorney's fees associated therewith, regardless of the whether the accrual
of such damages or deficiency occurs before or after an eviction. If a portion
of the security deposit is used or applied by Landlord during the term hereof,
Tenant shall, upon five (5) days written demand, deposit with Landlord an amount
sufficient to restore the security deposit to its original amount.
ARTICLE XXVIII
MISCELLANEOUS PROVISIONS
------------------------
28.1 Captions. The captions used herein are for convenience only and do
--------
not limit or amplify the provisions hereof. Whenever the singular is used the
same shall include the plural, and words of any gender shall include the other
gender.
28.2 Waiver. One or more waivers of any covenant, term or condition of
------
this Lease by either party should not be construed as a waiver of a subsequent
breach of the same covenant, term or condition. The consent or approval by
either party shall not be construed as a waiver of a subsequent breach of the
same covenant, term or condition. The consent or approval by either party to or
of any act by the other party requiring such consent or approval should not be
deemed to waive or render unnecessary consent to or approval of any subsequent
similar act.
28.3 Entire Agreement. This Lease contains the entire agreement between
----------------
the parties and no agreement shall be effective to change, modify or terminate
this Lease in whole or in part unless such agreement is in writing and duly
signed by the parties hereto.
28.4 Severability. The invalidity or unenforceability of any provision
------------
hereof shall not affect or impair any other provision.
28.5 Modification. Should any mortgagee or beneficiary under a deed of
------------
trust require a modification of this Lease, which modification (i) will not
bring about any increased cost or expense to Tenant and (ii) will not in any way
substantially change the rights and obligations of Tenant hereunder, then and in
such event, ▇▇▇▇▇▇ agrees that this Lease may be so modified.
28.6 Governing Law. This Lease shall be governed by and construed
-------------
pursuant to the laws of the State of Colorado.
28.7 Successors and Assigns. The covenants and conditions herein
----------------------
contained shall inure to and bind the respective heirs, permitted successors,
executors, administrators and assigns of the parties hereto, and the terms
"Landlord" and "Tenant" shall include the permitted successors and assigns of
either such party, whether immediate or remote, except as otherwise specifically
set forth in this Lease to the contrary.
28.8 Authorization to Execute. In the event that Landlord or Tenant
------------------------
hereunder shall be a corporation, the parties executing this Lease on behalf of
such entity hereby covenant and warrant that such entity is a duly qualified
corporation and all steps have been taken prior to the date hereof to qualify
such entity to do business in the State of Colorado; all franchise and corporate
26
taxes have been paid to date, and all future forms, reports, fees and other
documents necessary to comply with applicable laws will be filed.
28.9 Guaranty of Lease. [INTENTIONALLY DELETED.]
-----------------
28.10 Approval of Documents. Unless such work is performed by Landlord
---------------------
or by Landlord's contractor, agents or employees, ▇▇▇▇▇▇▇▇'s approval of
Tenant's plans for work performed by Landlord or Tenant in the Premises shall
create no responsibility or liability on the part of Landlord for their
completeness, design, sufficiency, or compliance with any laws, rules, or
regulations of governmental agencies or authorities. If Landlord or its
contractor, agents, or employees perform such work, then Landlord will be
responsible for obtaining the applicable permits which will be deemed compliance
with law.
28.11 Financing Contingency. Tenant acknowledges that this Lease is
---------------------
subject to the condition subsequent that Landlord obtain a construction and
acquisition loan for Building Complex on or before the date which is sixty (60)
days after ▇▇▇▇▇▇'s final approval of the Construction Drawings subject to
extensions for Tenant caused or contributed to delays. ▇▇▇▇▇▇▇▇ acknowledges and
agrees that it will apply for a construction loan with (a) a maximum interest
rate not to exceed three hundred basis points over the prime rate quoted by such
lender, as the rate floats over the term of the loan (b) a minimum term of not
less than eighteen (18) months and (c) a principal amount of not less than
eighty percent (80%) of all costs attributable to the construction, inclusive of
loan fees and interest payments permitted to be made with loan proceeds. In the
event of the termination of this Lease pursuant to the terms of this Section
28.11, neither party shall have any liability or obligation whatsoever to the
other except that any rent or deposit of Tenant shall be promptly refunded,
without interest except as specifically set forth herein, by Landlord.
ARTICLE XXIX
SUBSTITUTION OF PREMISES
------------------------
29.1 [INTENTIONALLY DELETED.]
ARTICLE XXX
RECORDING
---------
30.1 Tenant may place a memorandum of this Lease of record on a form
previously approved by Landlord which approval shall not be unreasonably
withheld. Landlord or Tenant shall also execute a reasonable memorandum of lease
in recordable form if requested by the other, which may be placed of record. In
addition, if requested by the Landlord, the Tenant will execute a memorandum of
lease to be filed with the Colorado Department of Revenue on such form as may be
prescribed by said department within ten (10) days after the execution of this
Lease or any other such memorandum so that the Landlord may avail itself of the
provisions of the statutes such as Section 39-22-604(7)(c) of the Colorado
Revised Statutes (1993).
Any recording by Tenant without ▇▇▇▇▇▇▇▇'s prior written consent shall
at Landlord's option be deemed a default pursuant to Article XVII hereof and
Landlord shall have all of the rights and remedies set forth therein. ▇▇▇▇▇▇
agrees if requested by ▇▇▇▇▇▇▇▇ to execute a quitclaim deed, releasing any
interests in the lease as set forth in the memorandum, which deed will be held
in escrow and recorded upon termination or expiration of the Lease.
27
ARTICLE XXXI
REAL ESTATE BROKER
------------------
31.1 Tenant represents and warrants that Tenant has dealt directly with
(and only with) The Colorado Group, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇ and ▇.▇. ▇▇▇▇ and
Associates, as brokers (the "Brokers") in connection with this Lease, and that
insofar as ▇▇▇▇▇▇ knows, no other broker negotiated or participated in the
negotiations of this Lease, or submitted or showed the Premises, or is entitled
to any commission in connection herewith and ▇▇▇▇▇▇ agrees to indemnify Landlord
against any liability arising from anyone claiming by or through Tenant,
including reasonable attorney's fees.
Landlord represents and warrants to Tenant that Landlord has dealt only
with the Brokers and that Landlord shall pay pursuant to its written agreement
with ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇ the commission set forth therein when same becomes due
and payable. All other commissions due the Brokers shall be payable by ▇▇▇▇▇▇▇ &
▇▇▇▇▇▇▇▇▇ and The Colorado Group pursuant to its separate agreement(s) with such
Brokers.
ARTICLE XXXII
RENT PREPAYMENT
---------------
32.1 Simultaneous with the satisfaction of the condition subsequent set
forth in Section 28.11, Tenant shall deposit with Landlord the sum of one month
of estimated Base Rent plus one-twelfth of estimated Real Estate Taxes and
Operating Expenses, which shall be applied to the first month's Base Rent and
Additional Rent as same becomes due and payable. Prior to the application of
said payment, in the event the Tenant defaults in its performance of any of the
terms and conditions hereof, ▇▇▇▇▇▇ hereby agrees that the rent prepayment shall
be treated as a security deposit, and Landlord may use, apply, or retain said
sum in accordance with Article 27.1. Landlord agreed to deposit the rent
prepayment into a segregated interest-bearing account and Tenant, provided there
is no default by Tenant, shall be entitled to the interest earned on such
amounts where (i) the Lease is terminated prior to the Commencement Date and the
prepayment is returned, or (ii) prepaid rent is applied to the first month's
Base Rent and Additional Rent in accordance with the above. To the extent
Landlord is taxed on the interest earned on such prepaid rent, then Landlord may
deduct from any interest to be paid to Tenant the amount of tax required to be
paid by Landlord.
ARTICLE XXXIII
OTHER PROVISIONS
----------------
33.1 Budget. Landlord shall disclose to Tenant all costs associated with
------
the development of Building Complex. Landlord will provide a budget ("Budget")
projecting all costs associated with the construction of the shell and core as
well as all costs associated with the tenant finish within the Premises. The
Budget, when mutually agreed to by Landlord and Tenant as hereinafter set forth,
shall be attached to this Lease as Exhibit K. On or before April 1, 1995,
Landlord and Tenant shall mutually review and approve the Budget. The Budget
will also contain a provision whereby Landlord will supply Tenant with a "not to
exceed" Base Rental Rate, which "not to exceed" Base Rental Rate shall be
calculated pursuant to the agreed upon Budget. If for any reason the Landlord
and the Tenant cannot agree on the Budget to be attached as Exhibit K to the
Lease, then the Lease shall be deemed terminated by written notice of either
party to the other and the rent prepayment shall be promptly returned by
Landlord to Tenant.
Ninety (90) days subsequent to the completion of the Building Complex by
Landlord, Landlord will provide a final accounting of all of the costs for the
28
Building Complex, in order to establish the Base Rental Rate, which Base Rental
Rate shall be based upon the actual costs incurred for the Building Complex and
shall be calculated pursuant to the provisions of Section 3.1 herein, but in no
event shall the Base Rental Rate exceed the "not to exceed" Base Rental Rate,
except as specifically provided in Exhibit K.
33.2 Single Tenant Building. Landlord and Tenant hereby acknowledge and
----------------------
agree that this Lease is intended as a lease for Tenant, as the sole and single
tenant, and to the extent any provisions provide for rights and/or obligations
of other tenants or otherwise is inconsistent with the rights or obligations of
Tenant as the sole and single tenant, then the lease shall be construed
consistent with the rights and obligations of the Tenant as the sole and single
tenant. Nothing herein shall prohibit Tenant from subletting in accordance with
Article VII hereof.
33.3 Abandonment and Vacation. Tenant may abandon or vacate all or any
------------------------
portion of the Building Complex, provided Tenant keeps and performs all other
obligations under the Lease including payment of Rent and maintenance of
insurance.
33.4 Option to Renew. Tenant shall have an option to renew the Lease for
---------------
two (2) additional terms of five (5) years each. In order to exercise each such
option, Tenant shall notify Landlord in writing at least 180 days prior to the
expiration of the respective lease term of its election to exercise option, upon
which time Landlord shall submit in writing within 30 days a proposal for the
then current Market Base Rental Rate (per rentable square foot per annum, "NNN")
for the applicable renewal option. Tenant shall have thirty (30) days from the
receipt of said notice to (i) accept the proposed Base Rental Rate in writing to
Landlord (ii) to reject the Base Rental Rate and elect the appraisal process set
forth below or (iii) elect not to extend. If Tenant elects not to extend or
fails to timely exercise its option, time being of the essence, the option shall
automatically terminate and be of no further force and effect and this Lease
shall terminate upon expiration of the then Lease term. The Base Rental Rate
during the respective renewal term shall be at ninety-five percent (95%) of the
then current Market Base Rental Rate. Any such renewal shall be upon all of the
terms, conditions and covenants of this Lease except as to (i) the amount of
Base Rent, (ii) options to renew or expand and (iii) Tenant finish or other
allowances or concessions. As used herein, "Market Base Rental Rate" shall mean
the then Base Rental Rate for comparable first class single tenant office
buildings of comparable size, location and age in the County of Boulder,
Colorado, at such time, taking into account the following factors (1) rent per
rentable square foot; (2) operating expenses and real estate tax payments; (3)
current rental escalators and (4) rental concessions, if any. If any portion of
the Market Base Rental Rate is attributable to improvements made by Tenant at
Tenant's expense, then the Market Base Rental Rate shall specifically exclude
any adjustment made by reason of such alterations.
If Tenant, by written notice delivered no later than thirty (30) days
after the date Landlord notifies Tenant of the Market Base Rental Rates, objects
to the Market Base Rental Rate determined by Landlord and elects to submit the
rate determination to appraisal, then, within seven (7) days of the date of
Tenant's objection, each party shall appoint a non-affiliated certified M.A.I.
Appraiser that has at least five (5) years' full-time commercial appraisal
experience in Boulder County to determine the Market Base Rental Rate, such
process to be completed within twenty (20) days after the date of the
appointment of the last appraiser. If a party does not appoint a qualified
appraiser within five (5) days after the other party has given notice of the
name of the appraiser then the single appraiser shall be the sole appraiser and
shall set the Market Base Rental Rate. The appraisers appointed by the parties
shall meet promptly and attempt to set the Market Base Rental Rate. If they are
unable to agree on the Market Base Rental Rate within twenty (20) days after the
date the second appraiser has been appointed, they shall elect a third appraiser
29
meeting the qualifications stated in this paragraph within seven (7) days after
the last day the two (2) appraisers are to set the Market Base Rental Rate. If
the appraisers are unable to agree on the third appraiser, either of the parties
to this Lease, after giving five (5) days' prior written notice to the other
party, may apply to the then president of the real estate board of Denver,
Colorado for the selection of a third appraiser who meets the qualifications
stated in this Section, which selection shall be made within three (3) days.
Each of the parties shall pay for the appraiser appointed by it and shall bear
one-half of the cost of appointing the third appraiser and of paying the third
appraiser's fee. The third appraiser, however selected, shall be a person who
has not previously acted in any capacity for either party. The appraisers shall
be instructed to consider the criteria above stated in determining the Market
Base Rental Rate.
Within twenty (20) days after the selection of the third appraiser, the
third appraiser shall determine the Market Base Rental Rate and all three of the
appraiser's Market Base Rental Rates shall be averaged excluding any single
Market Base Rental Rate which is either ten percent (10%) higher or lower than
the middle appraisal of Market Base Rental Rate and the remaining appraisals
shall then be averaged.
If the Market Base Rental Rate is not established for the respective
extended term prior to its commencement, Tenant shall continue to pay the
applicable Base Rent required for the last full month of the respective Lease
term until the appraisers have made their determination. The Market Base Rental
Rate in question, when finally determined by the appraisers, shall be
retroactive to the commencement of the extension term, and the first Base Rent
payment becoming due after the determination of the applicable Market Base
Rental Rate shall include the retroactive amounts of monthly Base Rent
installments accrued and unpaid. In no event may either Landlord or Tenant elect
not to extend the Lease based upon the Market Base Rental Rate established in
accordance herewith.
This option to renew may not be exercised and the Lease shall not be
renewed if Landlord has given Tenant notice of default which default is not
cured within any applicable cure periods or waived by Landlord.
33.5 Option to Expand. Tenant may, upon written notice to Landlord
----------------
received not later than the day which is forty-two months after the date that
Landlord acquires the real property portion of the Premises (the "Acquisition
Date"), elect to have Landlord acquire the real property designated on Exhibit
L hereto (the "Expansion Land") and build certain improvements thereon as
---
shown on Exhibit K (the "Expansion Building") (collectively the Expansion Land
and the Expansion Building hereinafter called the "Expansion Premises").
Landlord and Tenant acknowledge that the Acquisition Date shall be as set forth
in Exhibit I, Supplemental Agreement.
Provided there is no uncured default of Tenant, as set forth below then
the Landlord shall exercise the option to purchase and shall purchase the
Expansion Land pursuant to the terms of that certain option to purchase by and
between Interlockers, Ltd. and Prime West Development, Inc. (the "Option"). If
-------------
Landlord fails to acquire the Expansion Land due to (i) default of Seller or
(ii) a Material Problem (defined below) which arises during any due diligence
period with respect to which Landlord follows the Resolution Procedure (defined
below) and such Material Problem is not resolved to Landlord's reasonable
satisfaction or waived by Landlord, then Landlord shall have no further option
to acquire the Expansion Land, and upon Landlord's written notice to Tenant,
this expansion option shall become null and void. The term "Material Problem"
shall mean a problem with the Expansion Land itself which would make it
commercially unreasonable for Landlord to acquire the Expansion Land, such as a
material title problem which is not curable on or before the closing (e.g., lis
pendens), environmental problems (e.g., groundwater contamination), and changes
in zoning or building ordinances which would materially interfere with the
construction of the Expansion Premises as outlined in Exhibit K. If any
Material Problem arises during a due diligence period available to Landlord with
respect to the Expansion Land, Landlord shall immediately notify Tenant of such
Material Problem by telephone and in writing. Tenant shall have the right, at
Tenant's option, to work with Landlord to determine whether or not a reasonable
cure for such Material Problem can be effected at no cost or expense to
Landlord. Landlord shall cooperate with Tenant to effect such reasonable cure
and shall not disapprove any cure proposed by Tenant which is commercially
reasonable and can be effected on or before the expiration of Landlord's due
diligence period (as it may be extended as set forth hereafter). If Tenant so
requests, ▇▇▇▇▇▇▇▇ will request an extension of any such due diligence period.
If the seller of the Expansion Land requires the payment of a fee or an
increased purchase price as a condition to granting an extension to the due
diligence period, Landlord will not be required to agree to such condition
unless Tenant agrees to pay such fee or such increased purchase price.
Landlord and Tenant agree to use the procedures, appraisal process and
time frames outlined on Exhibit C for the Expansion Premises. If Landlord is not
30
Prime West Development, Inc., Landlord may retain a developer for the
construction of the Expansion Premises, which developer shall work directly with
Tenant subject to the written direction and approval of the Landlord.
The Base Rental Rate for the Expansion Premises shall be calculated in
the same manner, using the same methods as the Base Rental Rate for the Premises
as described in Exhibit J. Exhibits E and H shall be applicable to the Expansion
Premises. The time frames for the Construction Date, the Financing Contingency,
and defined dates for construction and completion shall be calculated for the
Expansion Premises using the same time frames as presently set forth in the
Lease. Tenant acknowledges that the Landlord's option price for the Expansion
Land is $4.00 per square foot and escalates by five percent (5%) per annum,
compounded from the Acquisition Date. Except as set forth below with respect to
the Term and the adjustments to Base Rental Rate, the Expansion Premises shall
be deemed for all other purposes a portion of the Premises and subject to all
other terms and conditions of the Lease including payments of Operating Expenses
and Real Estate Taxes, and renewal rights.
As of the Commencement Date for the Expansion Premises the Lease Term
for the Premises inclusive of the Expansion Premises shall be extended for a
period equal to fifteen (15) years from such Commencement Date. The Base Rental
Rate shall adjust every five (5) years thereafter. For the existing Premises,
the five-year adjustment shall continue on its present schedule and will
continue to adjust every five years for the remainder of the Lease Term as
extended. The parties hereto acknowledge that this may result in staggered
adjustments in the Base Rental Rate for the existing Premises and the Expansion
Premises.
This Option may not be exercised by Tenant and the Premises shall not be
expanded if Landlord has given Tenant notice of default which default is not
cured within any applicable cure periods or waived by Landlord.Failure to
exercise the Option in accordance herewith shall render this Option null and
void. The parties agree to promptly execute a Supplemental Agreement for the
Expansion Premises upon completion of the Expansion Premises, in accordance with
the terms hereof.
IN WITNESS WHEREOF, the parties hereto have executed this Lease this
5th day of July, 1995.
LANDLORD:
Prime West Development, a Colorado corporation
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Its: President & CEO
TENANT:
CIRRUS LOGIC, INC., a __________ corporation
By:
-----------------------------------
Title: Controller
31
STATE OF COLORADO )
) ss.
CITY AND COUNTY OF DENVER )
The foregoing instrument was acknowledged before me this 22nd day
of June, 1995, by ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ as President and CEO of Prime West.
WITNESS my hand and official seal.
My commission expires:
My address is:
[NOTARY PUBLIC SIGNATURE APPEARS
HERE] [ILLEGIBLE]
--------------------------------
Notary Public
My Commission Expires July 6, 19??
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
STATE OF COLORADO )
) ss.
CITY AND COUNTY OF DENVER )
The foregoing instrument was acknowledged before me this _____ day of
_______________, 19__, by _________________________________
as ___________________ of ____________________________________.
WITNESS my hand and official seal.
My commission expires:
My address is:
--------------------------------
Notary Public
32
EXHIBIT A
CIRRUS LOGIC, INC. FACILITY
305 INTERLOCKEN PARKWAY
LEGAL DESCRIPTION
(To Be Determined Based Upon Final Survey)
A portion of
Lot 1
Final Plat
Interlocken, Filing #2
Consisting of approximately 4.6 Acres
Known as 305 Interlocken Parkway
Interlocken Advanced Technology Environment
Broomfield, Colorado
33