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EXHIBIT 10
OFFICE BUILDING LEASE
SORRENTO WEST PROPERTIES, INC.
AND
OCEANIC EXPLORATION COMPANY
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ARTICLE 1 DEFINITIVE LEASE TERMS..........................................................................1
Section 1.01 Office Building........................................................................1
Section 1.02 Premises...............................................................................1
Section 1.03 Term...................................................................................1
Section 1.04 Commencement Date......................................................................1
Section 1.05 Minimum Rent...........................................................................2
Section 1.06 Grant..................................................................................2
Section 1.07 Additional Rent........................................................................2
Section 1.08 Use....................................................................................2
ARTICLE 2 ALTERATIONS AND ADDITIONS.......................................................................3
Section 2.01 Alterations by Tenant..................................................................3
ARTICLE 3 OPERATING COST..................................................................................4
Section 3.01 Additional Rent........................................................................4
Section 3.02 Base Year..............................................................................4
Section 3.03 Proportionate Share....................................................................4
Section 3.04 Estimates and Payments.................................................................4
Section 3.05 Extra Charges..........................................................................5
Section 3.06 Operating Expenses Defined.............................................................5
A. Taxes..................................................................................5
B. Insurance..............................................................................5
C. Common Area Maintenance Costs..........................................................6
D. Other Maintenance .....................................................................7
ARTICLE 4 TENANT COVENANTS................................................................................8
Section 4.01 Care of Premises.......................................................................8
Section 4.02 Compliance with Law....................................................................8
Section 4.03 Tenant's Insurance.....................................................................8
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Section 4.04 Tenant's Indemnification.............................................................. 9
Section 4.05 Utilities.............................................................................10
Section 4.06 Personal Property Taxes...............................................................10
Section 4.07 Liens.................................................................................10
Section 4.08 Security Deposit......................................................................10
Section 4.09 First Month's Rent....................................................................11
Section 4.10 Signs.................................................................................11
Section 4.11 Surrender.............................................................................11
Section 4.12 Telephone Service.....................................................................11
ARTICLE 5 LANDLORD'S COVENANTS AND RIGHTS................................................................12
Section 5.01 Subordination.........................................................................12
Section 5.02 Estoppel............................................................................. 12
Section 5.03 Landlord's Services...................................................................12
A. Services to Premises..................................................................12
B. Services to Building..................................................................14
C. Limitations...........................................................................14
Section 5.04 Alterations by Landlord...............................................................15
Section 5.05 Entry by Landlord.....................................................................15
ARTICLE 6 GENERAL PROVISIONS.............................................................................15
Section 6.01 Parking...............................................................................15
Section 6.02 Assignment and Subletting ............................................................16
A. Tenant's Covenants....................................................................16
B. Operations of Consent.................................................................16
C. Effectiveness of Assignment or Sublease...............................................18
D. Certain Transfers.....................................................................18
E. Rights of Landlord....................................................................18
F. Survival..............................................................................18
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Section 6.03 Eminent Domain........................................................................18
A. Taking................................................................................18
B. Partial Taking of Building............................................................18
C. Surrender.............................................................................19
D. Partial Taking of Premises............................................................19
E. Awards................................................................................19
Section 6.04 Default/Remedies......................................................................19
A. Events of Default.....................................................................19
B. Deliberate Default....................................................................21
C. Remedies..............................................................................21
(1) Repossession without Termination.....................................22
(2) Repossession with Termination........................................23
Section 6.05 Damage by Fire or Other Casualty......................................................24
Section 6.06 Landlord's Lien and Security Interest.................................................25
Section 6.07 Waivers of Claims.....................................................................26
Section 6.08 Bankruptcy............................................................................26
ARTICLE 7 MISCELLANEOUS PROVISIONS.......................................................................27
Section 7.01 Late Charges..........................................................................27
Section 7.02 Holding Over..........................................................................27
Section 7.03 Notices...............................................................................27
Section 7.04 Authority of Tenant...................................................................28
Section 7.05 Financial Statements..................................................................28
Section 7.06 Venue.................................................................................29
Section 7.07 Statutory Remedies Waiver.............................................................29
Section 7.08 Authorities for Action................................................................29
Section 7.09 Brokerage.............................................................................29
Section 7.10 Definition of Landlord................................................................29
Section 7.11 Entire Agreement......................................................................29
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Section 7.12 Jury Trial Waiver.....................................................................30
Section 7.13 Force Majeure.........................................................................30
Section 7.14 Severability..........................................................................30
Section 7.15 No Offer, Option, Etc.................................................................30
Section 7.16 Relationship of Parties...............................................................30
Section 7.17 Name of Building......................................................................30
Section 7.18 Successors Bound......................................................................30
Section 7.19 Interpretation........................................................................31
Section 7.20 Restrictive Covenants.................................................................31
Section 7.21 Time of Essence.......................................................................31
Section 7.22 Easements.............................................................................31
Section 7.23 Enlarging the Building................................................................31
Section 7.24 Limitation of Landlord Liability......................................................32
Section 7.25 No Recordation; Notice to Mortgagee...................................................32
Section 7.26 Rules and Regulations.................................................................32
Section 7.27 Sale, Conveyance and Assignment.......................................................33
Section 7.28 Relocation............................................................................33
Section 7.29 Inability to Perform; Covenants Independent...........................................33
Section 7.30 Cumulative Remedies...................................................................33
Section 7.31 Attorneys' Fees.......................................................................34
Section 7.32 Continuing Liability..................................................................34
Section 7.33 No Merger.............................................................................34
Section 7.34 Definition of Lease...................................................................34
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OFFICE BUILDING LEASE
THIS LEASE is entered into the 1st day of September, 2000,
between Sorrento West Properties, Inc., a Delaware corporation ("Landlord"),
whose address is 7800 East Dorado Place, Englewood, CO 80111 and Oceanic
Exploration Company, a Delaware corporation ("Tenant").
WITNESSETH:
For and in consideration of the mutual promises, covenants
and agreements herein contained, the receipt and sufficiency of which are
hereby acknowledged, Landlord and Tenant agree as follows:
ARTICLE 1
DEFINITIVE LEASE TERMS
SECTION 1.01 OFFICE BUILDING. The building, which together
with the land and all related facilities, is located at 7800 East Dorado Place,
Englewood, CO 80111 and more fully described in Exhibit A, attached hereto and
made a part hereof, the "Building." For the purposes of this Lease, the
Building shall be deemed to contain 68,900 square feet and the parties hereto
agree to be bound by such square footage whether the same shall be more or less
in actuality.
SECTION 1.02 PREMISES. For the purposes of this Lease, the
Premises shall be Suite number 250 defined as that space shown on Exhibit B
attached hereto, the "Drawing." The Premises shall be deemed to contain 4,990
rentable square feet and the parties hereto agree to be bound by such rentable
square footage whether the same shall be more or less in actuality. Tenant
accepts the Premises in its current "as is" condition.
SECTION 1.03 TERM. This Lease shall commence on the
Commencement Date (hereinafter defined) and shall end on the Termination Date
(hereinafter defined) and such period shall be defined as the "Term" of this
Lease. The Termination Date shall be the date 5 years after the Commencement
Date.
SECTION 1.04 COMMENCEMENT DATE. Unless otherwise agreed in
writing, the Commencement Date of this Lease shall be September 1, 2000.
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SECTION 1.05 MINIMUM RENT. Tenant agrees to pay to Landlord
as Minimum Rent, without notice or demand on the first day of each successive
month, during the Term of this Lease in the following monthly installments:
MONTHS PAYMENTS RENT PER
------ -------- --------
SQUARE FEET
-----------
1 to 36 $ 7,485.00 $18.00
37 to 60 $ 7,692.92 $18.50
__ to __ $ ________ $_____
__ to __ $ ________ $_____
__ to __ $ ________ $_____
__ to __ $ ________ $_____
SECTION 1.06 GRANT. Subject to the terms, covenants,
conditions and provisions of this Lease, Landlord does hereby demise and lease
to Tenant and Tenant does hereby rent and take from Landlord and shall
peaceably and quietly hold and enjoy the Premises, together with the right of
non-exclusive use, in common with others, of automobile parking areas and other
common areas and facilities which may be furnished by Landlord.
SECTION 1.07 ADDITIONAL RENT. Tenant agrees to pay as
Additional Rent its pro rata share of expenses as defined in Article 3 hereof
on the first day of each month during the Term in the same manner as Minimum
Rent. Tenant agrees that the amounts indicated below are the specific amounts
due as Additional Rent, but are subject to change annually as provided for
within said Article.
Initial Monthly Payments: Insurance: $ 0
----
Taxes: $ 0
----
Common Area Maintenance: $ 0
----
Other Maintenance: $ 0
----
Other Charges
(to be defined): $ 0
----
Other Charges
(to be defined): $ 0
----
Total Monthly Additional Rent Due: $ 0
----
SECTION 1.08 USE. The Premises shall be used and occupied by
Tenant (and any permitted and approved subtenants and/or assignees of Tenant)
only for general office use and Tenant shall not use or permit the Premises to
be used for any other purpose without the prior written consent of Landlord.
Such consent shall be at Landlord's sole discretion.
2
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ARTICLE 2
ALTERATIONS AND ADDITIONS
SECTION 2.01 ALTERATIONS BY TENANT. Tenant shall not make or
allow to be made any alterations, additions or improvements (hereinafter
referred to as "Alterations") to or of the Premises or any part thereof without
first obtaining the written consent of Landlord. All Alterations to or of the
Premises, including, but not limited to, carpet, wallcovering, paneling and
built-in cabinet work, but excepting movable furniture and trade fixtures,
shall become the property of Landlord and shall be surrendered with the
Premises. All Alterations to or of the Premises by Tenant, shall be at Tenant's
sole cost and expense.
All Alterations under this Section 2.01 shall be performed in
a good and workmanlike manner, shall be at least equal in quality, utility and
usefulness to the original work, shall be of the first class, modern character,
and shall not diminish the overall value of the Building. Tenant shall submit
detailed plans and specifications to Landlord for approval prior to the
commencement of any Alterations.
All Alterations shall be done by contractors and/or mechanics
approved by Landlord.
All Alterations shall, upon installation, become the property
of Landlord and shall remain upon and be surrendered with the Premises, unless
Tenant by notice to Landlord no later than thirty (30) days prior to the
Termination Date or any renewal or extension thereof requests Landlord's
consent to remove the same. If Landlord so consents, the same shall be removed
from the Premises by Tenant prior to the Termination Date or at the end of any
renewal or extension at Tenant's sole expense. Nothing in this Article shall be
construed to give Landlord title to or to prevent Tenant's removal of trade
fixtures or moveable office furniture and equipment, but upon removal of any
such from the Premises or upon removal of any other installation as may be
permitted by Landlord, Tenant shall immediately and at its expense, repair and
restore the Premises to the condition existing prior to such removal. Tenant
shall repair any damage to the Premises or the Building incurred during such
removal. All property permitted or required to be removed by Tenant at the end
of the Term or any renewal or extension remaining on the Premises after the
Termination Date or the renewal or extension thereof shall be deemed abandoned
and may, at the election of Landlord, either be retained as Landlord's property
or may be removed from the Premises by Landlord at Tenant's expense.
3
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ARTICLE 3
OPERATING COST
SECTION 3.01 ADDITIONAL RENT. All Operating Expenses as
defined within this Article 3 shall be paid by Tenant to Landlord as Additional
Rent as specified in Section 1.07 hereof and this Article 3.
SECTION 3.02 BASE YEAR. In the event that Operating Expenses
(as hereinafter defined) of any Operating Year (defined as a calendar year),
other than the Base Operating Year (as hereinafter defined), during the Term or
any renewal or extension thereof, exceed an amount equal to the total of the
Operating Expenses for the calendar year 2001 (hereinafter referred to as the
"Base Operating Year") Tenant shall pay to Landlord as additional rent Tenant's
pro rata share of such excess Operating Expenses.
SECTION 3.03 PROPORTIONATE SHARE. Tenant's pro rata share of
expenses or other amount shall be computed by multiplying said excess Operating
Expenses by a fraction, the numerator of which shall be the number of rentable
square feet in the Premises, and the denominator of which shall be the total
number of rentable square feet of the Building.
SECTION 3.04 ESTIMATES AND PAYMENTS. Landlord will estimate
the amount of Operating Expenses to be incurred for the ensuing calendar year
and Tenant's pro rata share of same. Landlord will give Tenant notice of such
estimated amounts and Tenant shall pay said amounts monthly to Landlord in the
same manner as Minimum Rent. Within one hundred twenty (120) days after the end
of each calendar year, Landlord will submit to Tenant a statement showing in
reasonable detail the Operating Expenses for the preceding calendar year along
with a reconciliation of estimated payments made by Tenant compared to Tenant's
actual pro rata share. Failure by Landlord to provide to tenant such statement
within said one hundred twenty (120) days shall not constitute a waiver by
Landlord of its right to collect the amounts due to Landlord under this Section
3.04. Within thirty (30) days of receipt of such statement and reconciliation
Tenant shall pay to Landlord any additional amounts owed to Landlord. Any
monies owed Tenant by Landlord as a result of said reconciliation shall be
applied by Landlord against the next accruing monthly installment(s) of
Additional Rent due by Tenant under the terms of this Lease. Tenant or its
representative shall have the right, at its expense during normal business
hours and at the location of Landlord's books and records, to audit Landlord's
books and records with respect to Operating Expenses at any time within fifteen
(15) days following the delivery by Landlord to Tenant of the statement and
reconciliation. Unless Tenant shall take written exception to any item
contained therein within twenty (20) days after delivery of the statement and
reconciliation, such shall be considered final and accepted by Tenant. If
Tenant disputes such statement and reconciliation, Tenant shall pay the monies
set forth thereon and any other monies owed by Tenant under this Lease as a
condition precedent to contesting said obligation. Any payments due under this
Article 3 shall be prorated for the final year of the Term on the per diem
basis in such proportion as Tenant's tenancy of the Premises bears to 365 days.
Tenant's obligation to pay any amounts due under this Article 3 and Landlord's
obligation to refund any overpayments made by Tenant under this Article
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3, for the final year of the Term shall survive the Termination Date or earlier
termination as herein provided.
SECTION 3.05 EXTRA CHARGES. If any expenses are incurred
either due to Tenant's occupancy of the Premises or as a special request of
Tenant and to the extent such expense benefits only the Tenant or the Premises,
then any such expense shall be the sole obligation of Tenant and shall not be
shared on a pro rata basis with the other tenants of the Building. Any such
"Extra Charges" shall be due and payable by Tenant within ten (10) days of
receipt of invoice for same by Tenant from Landlord.
SECTION 3.06 OPERATING EXPENSES DEFINED. "Operating Expenses"
shall consist of all expenditures or obligations made or incurred by Landlord
associated with the ownership, maintenance and operation of the Building as may
be determined by Landlord to be necessary. Without limiting the generality of
the foregoing, Operating Expenses shall include, but not be limited to, the
following:
A. Taxes. Taxes shall mean all taxes and assessments
and governmental charges levied, including but not limited to federal,
state, county, or municipal or other taxing districts or authorities
presently taxing the Building or by others, subsequently created or
otherwise, and any other taxes or assessments attributable to the
Building or its operation. Taxes shall further mean all rental taxes,
real estate taxes and assessments or substitutes therefor or
supplements thereto, upon, applicable, attributable or reasonably
allocated to the Building or any part thereof, or any improvement
thereon, for any tax year or other tax period or partial tax year or
period during the Term hereof. If and to the extent that due to a
change in the method of taxation or assessment, any franchise, capital
stock, capital, rent, income, profit or other tax or charge shall be
deemed a substitute, supplement or addition to the same, then all such
items shall be included in the term Taxes for the purposes of this
Lease. Should Landlord dispute and contest the Taxes all costs
associated with such dispute or a review for reasonableness shall be
considered Taxes for the purposes of this Lease.
B. Insurance. Insurance shall mean all insurance of
any type that Landlord, in its sole discretion, shall deem necessary
or advisable to carry in order to protect the Building or its interest
therein. Landlord shall have the right and option but shall not be
obligated to maintain Insurance, during the Term, including, but not
limited to, the types and amounts that follow:
(i) Comprehensive public liability and
property damage insurance and products liability insurance
(where there is an exposure) insuring against claims for
personal injury, sickness, disease or death and property
damage, in or about the Building, including independent
contractor coverage, with a combined single limitation of
coverage in an amount not less than Three Million Dollars
($3,000,000), or with split limits of bodily injury not less
than Two Million Dollars ($2,000,000) per occurrence and
limits of property damage liability of not less than One
Million Dollars ($1,000,000).
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(ii) Fire and extended coverage insurance
covering the Building, against loss or damage by fire,
windstorm, hail, explosion, riot, damage from aircraft and
vehicles, smoke damage, vandalism, malicious mischief and
such other risks as are from time to time covered under
"extended coverage" endorsements and special extended
coverage endorsements commonly known as "all risks"
endorsements, flood and earthquake insurance in an amount
equal to the greater of the full replacement value or that
required by Landlord's mortgagee from time to time, and
including builder's risk coverage as such applies to
Landlord's Work.
(iii) If the nature of Landlord's
undertakings with respect to this Lease and the Building
requires that any or all of its employees be provided
coverage under state Worker's Compensation Insurance or
similar statutes, Landlord shall keep in force such statutory
coverage containing statutorily prescribed limits.
Landlord shall have the right and option,
but shall not be obligated, to change, cancel, decrease or
increase the foregoing insurance, or add additional forms of
insurance as Landlord shall deem necessary or desirable;
and/or to obtain the foregoing forms of insurance directly
and through umbrella policies or policies covering both the
Building and other assets owned by or associated with
Landlord.
C. Common Area Maintenance Costs. Common Area
Maintenance Costs shall mean the maintenance of all common areas of
the Building including, without limitation, all parking areas,
(whether temporary or permanent), access roads, driveways, curbs,
truckways, loading areas and docks, retaining walls, lighting
facilities, service corridors, comfort stations, pedestrian sidewalks,
stairways, plazas, corridors, lobbies, foundations, exterior and
demising walls, roofs over the entire Building including the Premises,
curbs, escalators, elevators, courts and ramps, decorative walls,
vacant, landscaped, and planting areas and facilities, gas, water,
electric, sewage, heating, ventilating, air conditioning, lighting,
music and intercom, and fire suppression and warning systems, conduits
and appurtenances for use by Tenant in common with other tenants, and
such other areas and facilities, whether within or outside the
Building, as may be designated by Landlord. Maintenance and operation
of the common areas shall include, but not be limited to, the
following:
(i) All expenses in connection with making
available for use by Tenant and others the parking facilities
for the Building including, but not limited to, any rent or
additional rent that Landlord may be required to pay for such
use, resurfacing, repainting, restripping, removal and
replacement of pavement, curbs and car stops, and snow and
ice removal;
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(ii) Wages and salaries for all employees
engaged in operating and maintaining, or providing security
for, the Building and personnel who may provide traffic
control relating to ingress and egress to and from the
parking facilities to the adjacent public streets. All taxes,
insurance and benefits relating to such employees shall be
included;
(iii) All supplies and materials used in
the operation and maintenance of the Building including, but
not limited to, uniforms, paper products, sales or use taxes
on supplies or services, painting and replacement of worn out
mechanical or damaged equipment;
(iv) Cost of all utilities, including but
not limited to, the cost of water, power, heating, lighting,
air conditioning and ventilation.
(v) Cost of all maintenance agreements
including, but not limited to, janitorial service, alarm
service, window cleaning, litter control, elevator
maintenance, exterminating and landscape maintenance of any
kind;
(vi) Amortization and interest of the cost
of installation of capital investment items which result in
or are intended to result in a reduction in Common Area
Maintenance Costs, as herein defined, or which are required
under any governmental law, regulation or authority. All such
costs shall be amortized over the reasonable life of the
capital investment items, with the reasonable life and
amortization schedule being determined in accordance with
generally accepted accounting principles and in no event to
extend beyond the reasonable life of the Building. Interest
shall be computed at the rate of twelve percent (12%) per
annum on the unamortized balance;
(vii) Landlord's legal fees, management
fees, central accounting costs and other professional
services associated with the operation and maintenance of the
Building; and
(viii) Cost of maintenance, repair and
replacements of roofs, ceilings and exterior walls, gutters,
glass, plate glass, show windows, plumbing, pipes and
fixtures, and other equipment; and
(ix) cost of all licenses, permits and
other governmental charges.
D. Other Maintenance. Other Maintenance shall
mean any maintenance required for the Building, the Premises or on the grounds
not part of or included in Common Area Maintenance Costs.
7
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ARTICLE 4
TENANT COVENANTS
SECTION 4.01 CARE OF PREMISES. Tenant shall take good care of
the Premises throughout the Term and preserve same in the condition delivered
to Tenant on the Commencement Date, except for normal wear and tear and to the
extent Landlord is specifically responsible therefor under this Lease. Tenant
shall be responsible for all injury or damage of any kind or character to the
Building, including the windows, floors, walls, ceilings, lights, electrical
equipment and heating, ventilating and air conditioning equipment, caused by
Tenant, its agents, servants, independent contractors or by anyone using or
occupying the Premises by, through or under the Tenant. Landlord shall repair
the same and Tenant shall pay the cost incurred therefor to Landlord
immediately upon demand.
SECTION 4.02 COMPLIANCE WITH LAW. Tenant shall not use the
Premises, or permit anything to be done in or about the Premises, which will in
any way conflict with any law, statute, ordinance or governmental rule or
regulation now in force or which may hereafter be enacted or promulgated.
Tenant shall not do or permit anything to be done in or about the Premises nor
bring or keep anything therein which is not within the permitted use of the
Premises, which will in any way increase the existing rate of or affect any
fire or other insurance upon the Building or any of its contents, or cause a
cancellation of any insurance policy covering the Building or any part thereof
or any of its contents.
SECTION 4.03 TENANT'S INSURANCE. Tenant shall at all times
during the Term of the Lease keep in full force and effect, at its sole cost
and expense, including, but not limited to, the types and amounts of insurance
that follow:
A. Comprehensive public liability and property
damage insurance and products liability insurance (where there is
exposure) insuring against claims for personal injury, sickness,
disease or death and property damage, in or about the Premises,
including independent contractor coverage, with a combined single
limitation of coverage in an amount not less than Three Million
Dollars ($3,000,000.00) or with split limits of bodily injury not less
than Two Million Dollars ($2,000,000.00) per occurrence and property
damage liability not less than One Million Dollars ($1,000,000.00).
B. Fire and extended coverage insurance covering
Tenant's merchandise, personal property, fixtures, improvements, wall
coverings, floor coverings, window coverings, alterations, furniture,
equipment, lighting, ceilings, heating, ventilation and air
conditioning equipment, interior plumbing and plate glass, against
loss or damage by fire, windstorms, hail, earthquakes, explosion,
riot, floods, damage from aircraft and vehicles, smoke damage,
vandalism and malicious mischief and such other risks as are from time
to time covered under "extended coverage" endorsements and special
extended coverage endorsements commonly known as "all risks"
endorsements in an amount equal to the greater of the full replacement
value or that required by Landlord's mortgagee from time to time.
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C. Business interruption insurance, which will
include coverage for Tenant's total rental obligation for twelve (12)
full months including Minimum and Additional Rents.
D. If the nature of Tenant's use of the Premises
requires that any or all of its employees be provided coverage under
State Workers' Compensation Insurance or similar statutory coverage
containing statutorily prescribed limits.
It is expressly understood and agreed that the foregoing
minimum limits of insurance coverage shall not limit the liability of Tenant
for its acts or omissions as provided in this Lease. All of the foregoing
insurance policies (with the exception of Workmen's Compensation Insurance to
the extent not available under statutory law) shall name Landlord (and such
other interested parties as Landlord shall from time to time designate) as an
additional insured and shall provide that any loss be payable to Landlord (and
any other interested parties as Landlord shall designate). All insurance
required hereunder shall be placed with companies approved by Landlord and
licensed to do business in the State of Colorado. All such policies shall be
written as primary policies, non-contributing with and in excess of coverage
which Landlord may carry. Tenant shall deliver copies of all such policies and
all endorsements thereto, certified as true and complete by the issuer thereof,
prior to the Commencement Date, together with evidence from the insurer that
such policies are fully paid for, and that no cancellation, material change or
non-renewal thereof shall be effective except upon thirty (30) days' prior
written notice from the insurer to Landlord and its designees. If Tenant shall
fail to procure and/or maintain said insurance, Landlord may, but shall not be
obligated to do so, and without waiving any other rights under this Lease,
procure and maintain any one or more portions of Tenant's required insurance
policies, at the expense of Tenant; and Tenant shall reimburse Landlord
therefor within ten (10) days of invoice.
SECTION 4.04 TENANT'S INDEMNIFICATION. Tenant shall indemnify
and hold Landlord harmless from and against any and all claims arising from
Tenant's use of the Premises or from the conduct of its business or from any
activity, work, or other things done, permitted or suffered by the Tenant in or
about the Premises; any breach or default in the performance of any obligation
on Tenant's part to be performed under the terms of this Lease or arising from
any act or negligence of the Tenant, or any officer, agent, employee, guest, or
invitee of Tenant; and, from all costs, attorneys' fees, and liabilities
incurred in the defense of any such claim or any action or proceeding brought
against, out of, or in anyway related to, this Lease. Tenant, upon notice from
Landlord, shall defend the same at Tenant's expense by counsel reasonably
satisfactory to Landlord. Tenant, as a material part of the consideration to
Landlord, hereby assumes all risk of damage to property or injury to persons
in, upon or about the Premises, from any cause excepting only Landlord's
negligence or intentional misconduct and, to the extent hereof, Tenant waives
all claims against Landlord. Tenant shall give prompt notice to Landlord in
case of casualty or accidents in the Premises.
Landlord or its agents shall not be liable for any loss or
damage to persons or property resulting from fire, explosion, falling plaster,
steam, gas, electricity, water or rain which may leak from any part of the
Building or from the pipes, appliances or plumbing works therein or
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from the roof, street or subsurface or from any other places resulting from
dampness or any other cause whatsoever, except personal injury, caused by or
due to the negligence of Landlord, its agents, servants or employees. Landlord
or its agents shall not be liable for interference with the lights, air or for
any latent defect in the Premises.
SECTION 4.05 UTILITIES. Without Landlord's prior written
consent, Tenant shall not install any equipment (such as tabulating or
computing equipment) in the Premises that requires an electrical current other
than 120 volt, single phase, or equipment which (singly) consumes more than 0.5
kilowatts at rated capacity, and, in any event, the cost of special electrical
installations approved by Landlord shall be paid by Tenant. Notwithstanding
anything contained herein to the contrary and notwithstanding any approval
thereof by Landlord, all costs for extraordinary, unusual or excessive demand
for electrical or other utility service and all cost of submetering or
monitoring of such use shall be borne by Tenant and Landlord reserves the right
to impose an additional charge on Tenant for such extraordinary, unusual or
excessive demand for electrical or other utility service in an amount
reasonably determined by Landlord to be due for such extraordinary, unusual or
excessive demand. These unusual costs include, but are not limited to, 24-hour
service, high consumption equipment, high concentration lighting, additional
HVAC supplements for equipment or lighting induced heat build-up and
installation of metering equipment. Landlord reserves the right to install, at
Tenant's sole cost and expense, submeters and related equipment, relating to
Tenant's use of electrical or other utility services.
SECTION 4.06 PERSONAL PROPERTY TAXES. Tenant shall pay, or
cause to be paid, before delinquency any and all taxes levied or assessed and
which become payable during the term hereof upon all Tenant's leasehold
improvements, equipment, furniture, fixtures, and any other personal property
located in the Premises.
SECTION 4.07 LIENS. Tenant shall keep the Premises and the
property in which the Premises are situated free from any liens arising out of
any work performed, materials furnished or obligations incurred by or on behalf
of Tenant. Landlord may require, at Landlord's sole option, that Tenant shall
provide to Landlord, at Tenant's sole cost and expense, a lien and completion
or payment and/or performance bonds in an amount equal to one and one-half (1
1/2) times the estimated cost of any improvements, additions or alterations in
the Premises which the Tenant desires to make, to insure Landlord against any
liability for mechanic's and materialmen's liens and to insure completion of
the work. Further, Tenant shall post the property or take whatever actions are
required to avail itself and Landlord of any statutory protections offered by
the laws and statutes of the State of Colorado.
SECTION 4.08 SECURITY DEPOSIT. Concurrently with the
execution of this Lease, Tenant shall deposit with the Landlord, and will keep
on deposit (without interest) at all times during the Term, the sum of Seven
Thousand Four Hundred Eighty-Five and No/100 Dollars ($7,485.00), as security
for the faithful performance by Tenant of all the terms, conditions and
covenants hereof. If, at any time during the Term, Tenant does not fulfill any
of the provisions of this Lease, Landlord shall have the right to use said
deposit, or so much thereof as necessary, to fulfill said provisions. In such
event, Tenant shall, on written demand of Landlord, forthwith remit to Landlord
a sufficient
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amount of cash to restore said deposit to its original amount. In the event
said deposit has not been utilized as aforesaid, said deposit, or as much
thereof as has not been utilized for said purposes, shall be refunded to
Tenant, without interest, upon full performance of this Lease by Tenant.
Landlord shall have the right to commingle said deposit with other funds of
Landlord. Landlord may deliver the funds deposited herein by Tenant to the
purchaser of Landlord's interest in the Premises in the event such interest be
sold, and thereupon, Landlord shall be discharged from further liability with
respect to such deposit. Said deposit shall not be considered as liquidated
damages, and if claims of Landlord exceed said deposit, Tenant shall remain
liable for the balance of such claims. Tenant's deposit shall be returned
within thirty (30) days of the expiration of this Lease, so long as Tenant is
not in default under the terms of this Lease.
SECTION 4.09 FIRST MONTH'S RENT. Landlord acknowledges
receipt of Seven Thousand Four Hundred Eighty-Five Dollars ($7,485.00), to be
applied toward the payment of the Minimum Rent for the first full month of
Tenant's occupancy of the Premises.
SECTION 4.10 SIGNS. Tenant shall not erect or install any
signs, without first having obtained the prior written consent and approval of
the Landlord. Such approval shall be in Landlord's sole discretion. Tenant
shall pay all costs of causing its permitted signs to be erected and
maintained.
SECTION 4.11 SURRENDER. Upon the Termination Date or other
termination of the Term, and without further notice, Tenant shall peaceably and
quietly quit and surrender to Landlord the Premises, broom clean, in as good as
condition as they were on the Commencement Date, ordinary wear and tear, loss
by fire, casualty and other causes beyond Tenant's control excepted. Tenant's
obligation to observe or perform this covenant shall survive the Termination
Date or other termination of the Term. The voluntary or other surrender of this
Lease by Tenant or the cancellation of this Lease by mutual agreement of Tenant
and Landlord shall not work a merger, and shall at Landlord's option terminate
all or any subleases and subtenancies or operate as an assignment to Landlord
of all or any subleases or subtenancies. Landlord's option hereunder shall be
exercised by notice to Tenant and to all known sublessees or subtenants in the
Premises or any part thereof.
SECTION 4.12 TELEPHONE SERVICE. Tenant shall separately
arrange with the applicable local public authorities or utilities as the case
may be, and directly pay for the furnishing, installation and maintenance of
all telephone services and equipment as may be required by Tenant in the use of
the Premises. Landlord shall not be liable for any damage resulting from
Tenant's inability to receive such services and any such inability shall not
relieve Tenant of any of its obligations under this Lease.
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ARTICLE 5
LANDLORD'S COVENANTS AND RIGHTS
SECTION 5.01 SUBORDINATION. Landlord covenants and agrees
that upon performance by Tenant of all of the covenants, agreements and
provisions hereof on Tenant's part to be kept and performed, Tenant shall have,
hold and enjoy the Premises, subject and subordinate to the rights set forth
herein, provided, however, that no diminution or abatement of payments due
hereunder shall be claimed by or allowed to Tenant for inconvenience or
discomfort arising from the making of any repairs or improvements to the
Premises or the Building, nor for any space taken to comply with any law,
ordinance or other governmental authority, except as provided for herein. The
obligation of Tenant to pay rent of all kinds hereunder is an independent
covenant and an absolute obligation. Tenant's rights hereunder and this Lease
are subject and subordinate to: (1) any reciprocal easement agreements or any
other easement and (2) the lien of any mortgage, which Landlord may now or
hereafter place upon the Premises and the Building. Tenant agrees to attorn to
the mortgagee or such other person, upon all the terms, covenants and
agreements set forth in this Lease. Tenant agrees to do and does hereby appoint
Landlord as its attorney-in-fact to execute or obtain execution of such
instruments as may be necessary to effect said subordination and attornment.
Such instruments may require Tenant to notify the mortgagee of defaults by
Landlord hereunder, to make rental payments to the mortgagee upon proper
notice, and to allow the mortgagee a reasonable time to cure defaults hereunder
if Landlord has not done so.
SECTION 5.02 ESTOPPEL. Tenant shall at any time and from time
to time upon not less than ten (10) days prior written request by Landlord,
execute, acknowledge and deliver to Landlord an estoppel certificate certifying
that this Lease is unmodified and in full force and effect (or, if there have
been modifications, that the same are in full force and effect as modified) and
stating the modifications and the dates to which the Base Rent and Additional
Rent have been paid in advance, if any, it being intended that any such
statement delivered pursuant to this paragraph may be relied upon by a
prospective purchaser of Landlord's interest or a mortgagee of Landlord's
interest or assignee of any mortgage upon Landlord's interest in the Building
or any other party which Landlord wishes to receive said estoppel certificate.
Tenant hereby constitutes and appoints Landlord as Tenant's attorney-in-fact to
execute any such estoppel certificate or certificate if Tenant does not execute
and deliver the same.
SECTION 5.03 LANDLORD'S SERVICES. Landlord shall operate and
maintain the Building in accordance with all applicable laws and regulations.
Subject to Tenant's payment of its Minimum Rent and such additional charges as
are set forth in this Lease, including without limitation, Operating Costs,
Landlord shall provide the following services:
A. Services to Premises: Landlord shall
provide to the Premises:
(i) Heated and refrigerated air
conditioning in season at such temperature and in such
amounts as shall be considered by Landlord to be standard
during the usual and customary business hours of 8:00 a.m. to
6:00 p.m., Monday through Friday, and 9:00 a.m. to 12:00 noon
on Saturday. Sundays, legal holidays, and any hours outside
those herein defined are not considered usual and customary
business hours, and such service will be provided at these
times only at the written request of Tenant, who shall pay,
upon demand, for such services a reasonable rate
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to be determined from time to time by Landlord. Any such
charge shall be subject to a minimum usage fee based on the
cost of three (3) hours service. Whenever machines,
equipment, or nonstandard lighting that generate abnormal
heat are used in the Premises which affect the temperature
otherwise maintained by the air conditioning system, Landlord
shall have the right to install supplemental air conditioning
equipment in or about the Premises, and the cost thereof,
including the cost of installation, operating, use,
maintenance, and metering, shall be paid by Tenant to
Landlord on demand together with interest at the highest
lawful rate per annum from the due date until paid.
(ii) Throughout the Term, Landlord shall
redistribute electrical energy to the Premises (not exceeding
the present electrical capacity of the Building) upon the
following terms and conditions:
(1) Landlord shall not be liable in
any way to Tenant for any loss, damage, failure,
effects or change in the quantity or character of
electricity furnished to the Premises or if such
quantity or character of electricity furnished to
the Premises is no longer available or suitable for
Tenant's requirements or due to any cessation,
diminution or interruption of the supply thereof;
(2) Landlord shall be responsible
for replacing all light bulbs, fluorescent lamps,
and all ballasts used by the Tenant in the Premises
except that Tenant shall be responsible for
replacing all lamps, bulbs, and ballasts in
nonbuilding standard fixtures;
(3) All meters and additional panel
board transformers, feeders, risers, wiring and
other conductors and equipment which may be required
to obtain additional electric energy, from the
public utility company for Tenant's purposes shall
be installed and maintained at Tenant's sole
expense; and
(4) Landlord shall not be liable in
the event of any interruption in the supply of
electricity, or of any other utility, including but
not limited to, air conditioning, heat or water, and
Tenant agrees that such supply may be interrupted
for inspection, repairs, replacement and in
emergencies. The failure to furnish or the
interruption of the same shall not be construed as a
constructive eviction of Tenant, and shall not
excuse Tenant from failing to perform any of its
obligations hereunder.
(iii) Janitor service on a five (5) day
week basis at no extra or additional charge; provided,
however, if Tenant's floor covering or other improvements is
other than building standard, Tenant shall pay the additional
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cleaning cost attributable thereto. Tenant's failure to pay
such charges shall constitute default hereunder.
B. Services to Building: Landlord shall provide in the
Building:
(i) Water (hot, cold and refrigerated) at
those points of supply provided for general use of tenants in
the Building;
(ii) Elevator service in common with other
tenants, if needed and already existing, for ingress to and
from the Premises; and
(iii) Heat, ventilation, cooling, lighting,
electric, power and domestic running water, in those areas of
the Building as may, from time to time, be designated by
Landlord for use during normal business hours by Tenant in
common with all tenants and other persons in the Building but
under exclusive control of Landlord.
C. Limitations: Landlord shall operate, maintain,
repair and replace the systems, facilities and equipment directly
necessary for the provision of Landlord's services under this Section
5.03 (except as such may be installed by or be the property of
Tenant), and shall be responsible for and shall expeditiously maintain
and repair the foundations, structure and roof of the Building
provided that;
(i) If all or part of such systems,
facilities, and equipment are destroyed, damaged or impaired,
Landlord shall have a reasonable time in which to complete
the necessary repair or replacement, and during that time
shall be required only to maintain such services as are
reasonably possible under the circumstances;
(ii) Landlord may temporarily discontinue
such services or any of them at such times as may be
necessary due to causes (except lack of funds) beyond the
reasonable control of Landlord or for purposes of
maintenance, repair, replacement, testing or examination;
(iii) Landlord shall use reasonable
diligence in carrying out its obligations under this Section
5.03 but shall not be liable under any circumstances for any
consequential damage to any person or property for any
failure to do so;
(iv) No reduction or discontinuance of such
services under this Section 5.03 shall be construed as an
eviction of Tenant or (except as specifically provided in
this Lease) release Tenant from any obligation of Tenant
under this Lease; and
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(v) Nothing contained herein shall derogate
from the provisions of Section 6.05 entitled Damage by Fire
or Other Casualty.
SECTION 5.04 ALTERATIONS BY LANDLORD. Landlord may from time
to time:
A. Make repairs, replacements, changes or
additions to the structure, systems, facilities and equipment in the
Premises where necessary to service the Premises or other parts of the
Building;
B. Make changes in or additions to any part of
the Building not in or forming part of the Premises; and
C. Change or alter the location of any areas
of the Building which may, from time to time, be designated by
Landlord for use during normal business hours by Tenant in common to
all tenants and other persons in the Building but under the exclusive
control of Landlord.
In connection therewith, Landlord and/or its representatives
may enter on or about the Premises and other areas of the Building with such
material as Landlord may deem necessary, and may erect scaffolding and all
other necessary structures on or about the Premises or the Building. Tenant
waives and releases any claims for damage including loss of business resulting
therefrom; provided, however, that in the exercise of its rights hereunder,
Landlord shall not unreasonably interfere with the conduct of Tenant's
business.
SECTION 5.05 ENTRY BY LANDLORD. Landlord reserves, and shall
at any and all times have the right to enter the Premises to inspect the same,
to submit said Premises to prospective purchasers or tenants, and to post
notices of non-responsibility. For each of the aforesaid purposes, Landlord
shall at all times have and retain a key with which to unlock all of the doors
in, upon and about the Premises, excluding Tenant's vaults, safes and files,
and Landlord shall have the right to use any and all means which Landlord may
deem proper to open said doors in an emergency, in order to obtain entry to the
Premises without liability to Tenant except for any failure to exercise due
care for Tenant's property. Any entry to the Premises obtained by Landlord by
any of said means, or otherwise, shall not under any circumstances be construed
or deemed to be forcible or unlawful entry into, or a detainer of, the
Premises, or an eviction of Tenant from the Premises or any portion thereof.
ARTICLE 6
GENERAL PROVISIONS
SECTION 6.01 PARKING. Tenant warrants that it has inspected the area
and size of the parking areas, and that they are sufficient for its needs.
All parking areas furnished by Landlord shall be subject to
the reasonable control and management of the Landlord who shall have the right,
but not the obligation, from time to time to
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establish, modify and enforce reasonable rules and regulations with respect
thereto. The Tenant agrees to abide by all such rules and regulations. Landlord
further reserves the right to change the area, to rearrange the area, and to
restrict or eliminate the use of any parking areas and do such other acts in
and to said areas as Landlord shall, in its sole discretion, determine. All
such actions, including such action or inaction as to rules and regulations for
the parking areas, shall not be deemed an eviction of Tenant or a disturbance
of Tenant's use of the Premises. Landlord may, at its sole and exclusive
discretion, designate areas for parking by Tenant's employees, and Tenant shall
thereafter be responsible to ensure that its employees park in the designated
areas.
SECTION 6.02 ASSIGNMENT AND SUBLETTING.
A. Tenant's Covenants. Tenant for itself, its
heirs, distributees, successors and assigns, expressly covenants that
it shall not by operation of law or otherwise assign, sublet, encumber
or mortgage this Lease, or any part thereof, or permit the Premises to
be used by others without the prior written consent of Landlord. Any
attempt by Tenant to assign, sublet, encumber or mortgage this Lease,
without obtaining Landlord's prior written consent, shall be null and
void. The consent by Landlord to any assignment, mortgage,
encumbrance, subletting or use of the Premises by others, shall not
constitute a waiver of Landlord's right to withhold its consent to any
other assignment, mortgage, encumbrance or use by others of the
Premises. Without the prior written consent of Landlord, this Lease
and the interest therein or any assignees of Tenant herein, shall not
pass by operation of law, and shall not be subject to garnishment or
sale under execution in any suit or proceeding which may be brought
against or by Tenant or any assignee of Tenant. Consent to any such
assignment or subletting shall in no way relieve Tenant of any
liability under this Lease. Notwithstanding anything to the contrary,
Tenant agrees not to enter into any agreement to lease or sublease any
portion of the Premises to any tenant or other occupant of any portion
of the Building. The absolute and unconditional prohibitions in this
Section 6.02 and Tenant's agreement thereto are material inducements
to Landlord to enter into this Lease with Tenant and any breach or
attempted breach thereof shall constitute a material default hereunder
permitting Landlord to exercise all remedies provided for herein or in
law or in equity on a default by Tenant.
B. Operations of Consent. If Tenant requests
Landlord's consent to any assignment of this Lease or a subletting of
all or any part of the Premises, Tenant shall submit to Landlord:
(i) the name of the proposed assignee
or subtenant;
(ii) the terms of the proposed
assignment or subletting;
(iii) the nature of the proposed
assignee or such subtenant's business and its proposed use of
the Premises; and
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(iv) such information as to its financial
responsibility and general reputation as Landlord may
require.
Landlord shall then have the following options, to
be exercised by notice ("Landlord's Notice") given to Tenant within
thirty (30) days after receipt of Tenant's request for consent (or
thirty (30) days after receipt of additional financial and credit
information requested by Landlord, whichever is later):
(1) Landlord may require Tenant to
surrender the Premises to Landlord and to accept a
termination of this Lease as of a date to be designated by
Landlord in the Landlord's Notice, which date shall not be
less than sixty (60) days nor more than one hundred twenty
(120) days following the date of Landlord's Notice, and this
Lease shall expire on such date as if that date had been
originally fixed as the Termination Date;
(2) Landlord may elect to consider Tenant's
request, provided that no Event of Default is in existence
and further provided that the following further conditions
shall be fulfilled:
(a) The subletting or assignment
shall be to a tenant whose occupancy will be in
keeping with the dignity and character of the then
use and occupancy of the Building and whose
occupancy will not be more objectionable or more
hazardous than that of Tenant herein or impose any
additional burden upon Landlord in the operation of
the Building;
(b) Tenant shall not receive any
money from the assignee, whether in the form of
monthly rentals, key money, fixture fees or
otherwise, in excess of the rent being paid to
Landlord under this Lease. If any such money is paid
to Tenant, Tenant shall promptly pay over such
amount to Landlord;
(c) The proposed sublessee or
assignee shall be a reputable party whose financial
net worth and financial responsibility is,
considering the obligations undertaken, reasonably
satisfactory to Landlord; and
(d) The subletting or assignment
shall be expressly subject to all of the obligations
of Tenant under this Lease and the further condition
that the Lease and Premises shall not be assigned,
encumbered, transferred, or subleased, in whole or
in part, or any part thereof suffered or permitted
by the sublessee to be used or occupied by others,
without the prior written consent of Landlord in
each instance.
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C. Effectiveness of Assignment or Sublease. No
permitted or consented to assignment or subletting shall be effective
or valid for any purpose whatsoever unless and until a counterpart or
copy of the assignment or sublease shall have been first delivered to
Landlord, and, in the event of an assignment, until Tenant has
delivered to Landlord a written agreement executed and acknowledged by
Tenant and such assignee wherein such assignee shall assume jointly
and severally with Tenant the due performance of Tenant's obligations
under this Lease to the Termination Date, notwithstanding any other or
further assignment.
D. Certain Transfers. Any transfer by operation of
law or otherwise, of (i) Tenant's interest in this Lease; (ii) a 50%
or greater equity, capital, profits or voting interest in Tenant
(whether stock, partnership interest or otherwise, and aggregating the
current transfer with previous transfers); or (iii) practical control
of Tenant and its affairs, shall be deemed an assignment of this Lease
for purposes of this Section 6.02.
E. Rights of Landlord. If Tenant's interest in this
Lease is assigned, whether or not in violation of the provisions of
this Lease, Landlord may collect all rent paid by the assignee; if the
Premises or any part thereof are sublet to, or occupied by, or used
by, any person other than Tenant, whether or not in violation of this
Lease, Landlord, after default by Tenant under this Lease, may collect
all rent paid by the subtenant, user or occupant. In either case,
Landlord shall apply the net amount collected to the rent reserved in
his Lease, but neither any such assignment, subletting, occupancy, or
use, nor any such collection or application shall be deemed a waiver
of any term, covenant or condition of this Lease or the acceptance by
Landlord of such assignee, subtenant, occupant or user as a tenant.
Tenant agrees to pay to Landlord any reasonable attorneys' fees and
other expenses incurred by Landlord in connection with any proposed
assignment of Tenant's interest in this Lease or any proposed
subletting of the Premises or any part thereof.
F. Survival. In no event shall any assignment or
subletting to which Landlord may consent, release or relieve Tenant
from its obligations to fully perform all of the terms, covenants and
conditions of the Lease on its part to be performed. Any subtenant
entering into occupancy of the Premises shall be deemed to have
consented to Landlord's ability to commence legal proceedings against
it, with or without naming Tenant as a party to such proceedings.
SECTION 6.03 EMINENT DOMAIN.
A. Taking. If during the Term all of the Premises
shall be taken for any public or quasi-public use under any statute or
by right of eminent domain, or purchased under threat of such taking,
this Lease shall automatically terminate on the date on which the
condemning authority takes possession of the Premises, "Date of such
Taking."
B. Partial Taking of Building. If during the Term
only part of the Building is taken or purchased as set out in this
Section 6.03, then;
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(i) if in the reasonable opinion of
Landlord substantial alteration or reconstruction of the
Building is necessary or desirable as a result thereof,
whether or not the Premises are or may be affected, Landlord
shall have the right to terminate this Lease by giving the
Tenant at least thirty (30) days written notice of such
termination; and
(ii) if more than one third (1/3) of the
number of square feet in the Premises is included in such
taking or purchase, Tenant shall have the right to terminate
this Lease by giving Landlord at least thirty (30) days'
written notice thereof and this Lease shall terminate upon
the Date of such Taking.
If either party exercises its right of termination hereunder,
this Lease shall terminate on the date stated in the notice; provided, however,
that no termination pursuant to notice hereunder may occur later than sixty
(60) days after the Date of such Taking.
C. Surrender. On any such date of termination under
this Section 6.03, Tenant shall immediately surrender to Landlord the
Premises and all interests therein under this Lease. Landlord may
re-enter and take possession of the Premises and remove Tenant
therefrom. In the event that the entire Premises are taken, Minimum
Rent and other charges shall abate on the date that Tenant no longer
has possession of the Premises. After such termination, and on notice
from Landlord stating the Minimum Rent and other charges then owing,
Tenant shall forthwith pay Landlord such Minimum Rent and other
charges.
D. Partial Taking of Premises. If any portion of the
Premises (but less than the whole thereof) is so taken, and no rights
of termination herein conferred are timely exercised, the Term of this
Lease shall expire with respect to the portion so taken on the Date of
such Taking. In such event the Minimum Rent and other charges payable
hereunder with respect to such portion so taken shall abate on such
date, and the Minimum Rent and other charges thereafter payable with
respect to the remainder not so taken shall be adjusted pro rata by
Landlord in order to account for the resulting reduction in the number
of square feet in the Premises.
E. Awards. Upon any such taking or purchase,
Landlord shall be entitled to receive and retain the entire award or
consideration for the affected lands and improvements. Tenant shall
not advance any claim against Landlord for the value of its property
or its leasehold estate or the unexpired Term of the Lease, or for
costs of removal or relocation, or business interruption expense or
any other damages arising out of such taking or purchase.
SECTION 6.04 DEFAULT/REMEDIES.
A. Events of Default. If any one or more of the
following acts or occurrences (any one of such being hereinafter
called an "Event of Default") shall happen
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then Landlord may exercise the rights and remedies hereinafter
provided, in addition to those otherwise provided in law or in equity:
(i) Tenant shall fail to pay any Minimum
Rent, Additional Rent, or other sums payable by Tenant under
this Lease as and when the same shall be due and payable;
(ii) Tenant shall default in the
performance of or compliance with any of the other covenants,
agreements, terms or conditions of this Lease to be performed
by Tenant (other than any default curable by payment of
money), and such default shall continue for a period of
fifteen (15) days after written notice thereof from Landlord
to Tenant, or, in the case of a default which cannot with due
diligence be cured within fifteen (15) days, Tenant shall
fail to proceed promptly after the giving of such notice and
with all due diligence to cure such default; or
(iii) Tenant or any Guarantor shall become
insolvent or unable to pay its debts as they become due, or
Tenant or any Guarantor notifies Landlord that it anticipates
either condition; Tenant or any Guarantor takes any action
to, or notifies Landlord that Tenant intends to file a
petition under any section or chapter of the Bankruptcy Code,
as amended from time to time, or under any similar law or
statute of the United States or any state thereof; or a
petition shall be filed against Tenant or any Guarantor under
any such statute or Tenant, any Guarantor or any creditor of
Tenant or any Guarantor notifies Landlord that it knows that
such petition will be filed; or a receiver or other custodian
shall be appointed for Tenant or any Guarantor, whether or
not the same shall relate to their interests in the
leasehold; or
(iv) if, within sixty (60) days after the
filing of an involuntary petition in bankruptcy against
Tenant or any Guarantor of this Lease or the commencement of
any proceeding against Tenant or any Guarantor of this Lease
seeking any reorganization, composition, readjustment or
similar relief under any law, such proceeding shall not have
been dismissed, or if, within sixty (60) days after the
appointment, without consent or acquiescence of Tenant or
Guarantor of this Lease, or any trustee, receiver or
liquidator of Tenant or of any Guarantor of this Lease, or of
all or any substantial part of the properties of Tenant or of
any Guarantor of this Lease or of all or any part of the
Premises, such appointment shall not have been vacated or
stayed on appeal or otherwise, or if, within sixty (60) days
after the expiration of any such stay, such appointment shall
not have been vacated, or if within sixty (60) days after the
taking of possession, without the consent or acquiescence of
Tenant or any Guarantor of this Lease, by any governmental
office or agency pursuant to statutory authority for the
governmental office or agency pursuant to statutory authority
for the dissolution or liquidation of Tenant or any Guarantor
of this Lease, such taking shall not have been vacated or
stayed on appeal or otherwise; or
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(v) the Premises have the appearance of
abandonment for a continuing period of ten (10) days; or
(vi) a tax lien or a mechanic's and/or
materialmen's lien shall be filed against any property of
Tenant; or
(vii) Tenant or any Guarantor of this Lease
shall default under any other lease or sublease with Landlord
or Landlord's agent; or
(viii) Tenant makes a bulk sale of its
goods or moves or commences, attempts or threatens to move
its goods, chattels and equipment out of the Premises (other
than in the normal course of its business) or ceases to
conduct business from the premises.
B. Deliberate Default. If an Event of Default occurs
two (2) times in any period of six (6) months, then, notwithstanding
that each such Event of Default shall have been cured, any further
default shall be deemed to be deliberate, and Landlord may exercise
the remedies provided herein or at law or in equity upon giving notice
as provided in this Lease or as may be required by law and without
affording Tenant an opportunity to cure such Event of Default.
C. Remedies. Upon the occurrence of any Event or
Events of Default by Tenant, whether enumerated within this Section
6.04 or not, Landlord shall have the option to pursue any one or more
of the following remedies without any notice except as provided for
herein or demand for possession whatsoever (and without limiting the
generality of the foregoing, Tenant hereby specifically waives notice
and demand for payment of rent or other obligations due and waives any
and all other notices of demand requirements imposed by applicable
law):
(i) terminate this Lease in which event
Tenant shall immediately surrender the Premises to Landlord;
(ii) terminate Tenant's right to occupy the
Premises and re-enter and take possession of the Premises
(without terminating this Lease);
(iii) enter upon the Premises and do
whatever Tenant is obligated to do under the terms of this
Lease; and Tenant agrees to reimburse Landlord on demand for
any expense which Landlord may incur in effecting compliance
with Tenant's obligations under this Lease, and Tenant
further agrees that Landlord shall not be liable for any
damages resulting to the Tenant from such action; and
(iv) exercise all other remedies available
to Landlord at law or in equity, including, without
limitation, injunctive relief of all varieties.
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(1) Repossession without
Termination. In the event Landlord does not elect to
terminate this Lease, but to the contrary, elects to
re-enter and take possession of the Premises without
terminating this Lease as permitted in subparagraph
(ii) of the immediately preceding paragraph of this
Section 6.04, such re-entry shall not relieve Tenant
of its liabilities and obligations under this Lease,
whether or not the Premises shall be relet. In the
event Landlord re-enters the Premises, or the
Premises are abandoned or become vacant for any
reason, Landlord may in its own name but as agent
for Tenant if this Lease not be terminated (or if
this Lease be terminated, on its own behalf), relet
the Premises for such term or terms (which may be
greater or less than the period which would
otherwise have constituted the balance of the term
of this Lease) and on such conditions (which may
include concessions of free rent and alterations of
the Premises) as Landlord, in its sole discretion
may determine and may collect and receive the rents
therefor. Landlord shall in no way be responsible or
liable for any failure to relet the Premises or any
part thereof, or for any failure to collect any rent
due upon such reletting.
In the event Landlord elects to re-enter or
take possession of the Premises after Tenant's
default, in no way shall the re-entry, possession or
reletting of the Premises by Landlord be construed
as an election by Landlord to terminate this Lease
unless written notice of such intention has been
given to Tenant, the Landlord and Tenant intending
by these presents to memorialize their intent that
in such event Tenant shall remain liable for future
rent and all other charges, notwithstanding said
re-entry, possession or reletting of the Premises.
Tenant hereby waives notice of such re-entry or
repossession and of Landlord's intent to re-enter or
retake possession. Landlord may, without prejudice
to any other remedy which it may have for possession
or arrearages in rent, expel or remove Tenant and
any other person who may be occupying said Premises
or any part thereof. All Landlord's remedies shall
be cumulative and not exclusive. Forbearance by
Landlord to enforce one or more of the remedies
herein provided upon an Event of Default shall not
be deemed or construed to constitute a waiver of
such default.
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Without limiting Landlord in the exercise
of any right or remedy which Landlord may have and
regardless of whether this Lease shall have been
earlier terminated, Landlord, at its sole election
and in either event, may recover from Tenant all
damages incurred by Landlord by reason of Tenant's
default including, without limitation, rent as it
becomes due or the worth at the time of an award of
the unpaid rent and all other charges remaining
unpaid for the remainder of the Term, any costs or
expenses incurred by Landlord in maintaining or
preserving the Premises after such default, the cost
of recovering possession of the Premises after such
default, the cost of maintaining or preserving the
Premises after such default, the cost of recovering
possession of the Premises, expenses of reletting,
including necessary renovation and alteration of the
Premises, Landlord's reasonable attorneys' fees,
free rent and any real estate commission paid or
payable and any other amount necessary to compensate
Landlord for all the detriment proximately caused by
Tenant's failure to perform.
(2) Repossession with Termination.
In the event that Landlord shall have terminated
this Lease then, in that event and in addition to
the foregoing and whatsoever other remedies Landlord
may have, Landlord shall be entitled to recover from
Tenant all damages incurred by Landlord by reason of
Tenant's default including: the worth at the time of
the award of unpaid Minimum Rent, Additional Rent,
and other charges which have been earned at the time
of the termination; the worth at the time of the
award of the amount by which the unpaid Minimum
Rent, Additional Rent, and other charges which would
have been earned after termination until the time of
the award exceeds the amount of such rental loss
that Tenant proves could have been reasonably
avoided; the worth at the time of the award of the
amount by which the unpaid Minimum Rent, Additional
Rent, and other charges which would have been paid
for the balance of the term after the time of award
exceeds the amount of such rental loss that Tenant
proves could have been reasonably avoided; and any
other amount necessary to compensate Landlord for
all the detriment proximately caused by Tenant's
failure to perform its obligations under the Lease
or which in the ordinary course of things would be
likely to result therefrom, including, but not
limited to any costs or expenses incurred by
Landlord in maintaining or preserving the Premises
after such default, the cost of recovering
possession of the Premises, expenses of reletting,
including necessary renovation or alteration of the
Premises, Landlord's reasonable attorneys' fees
incurred in connection therewith, free rent and any
real estate commission paid or payable.
In no event shall Tenant be entitled to
receive the benefit of Landlord having relet the
Premises at a greater rental rate than hereunder.
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No payments of money by Tenant to Landlord
after the expiration or other termination of the
Term after the giving of any notice by Landlord to
Tenant shall reinstate, continue to extend the Term
or make ineffective any notice given to Tenant prior
to the payment of such money. After the service of
notice or commencement of a suit, or after final
judgment granting Landlord possession of the
Premises, Landlord may receive and collect any sums
due under the Lease, and the payment thereof shall
not make ineffective any notice, or in any manner
affect any pending suit or judgment theretofore
obtained.
SECTION 6.05 DAMAGE BY FIRE OR OTHER CASUALTY. If the
Premises shall be damaged by fire or other casualty not arising from the fault
or negligence of Tenant or its servants, agents, employees, invitees or
licensees, except as otherwise provided in this Section 6.05, the damages shall
be repaired by and at the expense of Landlord with reasonable promptness,
provided always, however, and upon the express condition that there are funds
available to Landlord from casualty insurance policy proceeds actually paid to
and received by Landlord for such repair work; and provided further that such
duty to repair by Landlord shall at all times be subject to the obtaining of
all necessary government approvals and subject to the approval and consent of
the then mortgagee and the willingness of such mortgagee to make the proceeds
of casualty insurance policies payable to such mortgagee available to Landlord
for such purposes. The Minimum Rent and any other charges until such repairs
shall be made shall be equitably abated according to the part of the Premises
which is usable by Tenant. Tenant shall repair or replace its own furniture,
furnishings and equipment. Landlord shall not be liable for any delay caused by
Force Majeure (hereinafter defined). If the Premises are totally damaged or are
rendered wholly untenantable by fire or other casualty, or if Landlord's
architect certifies that it cannot be repaired within one hundred eighty (180)
days of the casualty or if Landlord shall decide not to repair the same, or
shall decide to demolish the Building or not to rebuild it, then Landlord
shall, within one hundred eighty (180) days after such fire and other casualty,
give Tenant a notice of such decision, and thereupon the Term shall expire ten
(10) days after such notice is given and Tenant shall vacate the Premises and
surrender the same to Landlord.
If Landlord does not substantially complete the repair and
restoration of the Premises within twelve (12) months from the date of the
casualty (subject to Force Majeure) then Tenant shall have the right to cancel
and terminate this Lease upon the delivery of a notice to Landlord delivered
not less than thirty (30) days after the expiration of the aforesaid twelve
(12) month period.
Tenant waives the benefit of any statutes of the State of
Colorado allocating insurance proceeds or requiring application thereof in
specific ways or relieving Tenant of rental obligations and agrees that Tenant
will not be relieved of the obligations to pay the Minimum Rent or any other
charges in case of damage to or destruction of the Building, or the Premises,
except as provided by this Lease.
Anything contained in this Lease to the contrary
notwithstanding, Landlord shall not be obligated to expend any funds in
connection with any repair or restoration work in excess of the
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<PAGE> 31
proceeds of insurance policy payments which are made available to Landlord by
insurance carriers and by any mortgagee of the Building or Premises. Landlord's
obligations in connection with such repair and/or restoration work shall be and
are hereby strictly limited to the replacement of the basic building area as
demised by Landlord to Tenant as of the Commencement Date of the term hereof
and in no event shall Landlord be obligated to replace, repair or restore any
improvements to the Premises or alterations thereof installed therein by or on
behalf of Tenant nor shall Landlord be obligated in any event whatsoever to
replace, repair, or restore Tenant's leasehold improvements, personal property,
furniture, fixtures, equipment or the like.
SECTION 6.06 LANDLORD'S LIEN AND SECURITY INTEREST. In
addition to the statutory landlord's lien, Landlord shall have at all times a
valid security interest to secure payment of all rentals and other sums of
money becoming due hereunder from Tenant and to secure payment of any damages
or loss which Landlord may suffer by reason of the breach by Tenant of any
term, covenant or conditions contained herein, upon all property of Tenant
presently, or which may hereafter be situated on the Premises, and all proceeds
therefrom, and such property shall not be removed therefrom without the consent
of Landlord until all arrearages in rent as well as any and all other sums of
money then due to Landlord hereunder shall first have been paid and discharged
and all the terms, covenants, and conditions hereof have been fully complied
with and performed by Tenant.
Upon the occurrence of an Event of Default by Tenant,
Landlord may, in addition to any other remedies provided herein, enter upon the
Premises and take possession of any and all goods, wares, equipment, fixtures,
furniture, improvements, and sell the same at public or private sale, with or
without having such property at the sale, giving Tenant reasonable notice of
the time and place of any public sale or of the time after which any private
sale is to be made, at which sale Landlord or its assigns may purchase unless
otherwise prohibited by law. Unless otherwise provided by law, and without
intending to exclude any other manner of giving Tenant reasonable notice, the
requirement of reasonable notice shall be met if such notice is given in the
manner prescribed in this Lease ten (10) days before the time of sale. Any sale
made pursuant to the provisions of this paragraph shall be deemed to have been
a public sale conducted in a commercially reasonable manner if held in the
Premises or where the property is located after the time, place and method of
sale and a general description of the types of property to be sold have been
advertised in a newspaper of general circulation in Arapahoe County, State of
Colorado for five (5) consecutive days before the date of the sale. The
proceeds from any such disposition, less any and all expense connected with the
taking of possession, holding and selling of the property (including reasonable
attorneys' fees and legal expenses) shall be applied as a credit against the
indebtedness secured by the security interest granted in this paragraph. Any
surplus shall be paid to Tenant or as otherwise required by law; Tenant shall
pay any deficiencies forthwith. Landlord acknowledges that the lien created
under this paragraph shall be subordinate to any purchase money security
interest relating to such goods, wares, equipment, fixtures, furniture,
improvements and other personal property of Tenant.
The provisions of this Section relating to said lien and
security interest shall constitute a security agreement under the Uniform
Commercial Code and Tenant agrees to execute as debtor such financing statement
or statements as Landlord may now or hereafter reasonably request in order that
such security interest or interest may be protected pursuant to said Code.
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Landlord may at its election at any time file a copy of this Lease as a
financing statement. Landlord, as secured party, shall be entitled to all the
rights and remedies afforded a secured party under said Code in addition to and
cumulative of the Landlord's Liens and rights provided by law or by the other
terms and provisions of this Lease.
SECTION 6.07 WAIVERS OF CLAIMS. Landlord and Tenant hereby
waive any and all rights to recover against the other and against other tenants
or occupants of the Building, and against their respective officers, directors,
stockholders, partners, employees, agents, representatives, customers or
business visitors, for damage to such waiving party or loss of its property or
the property of others under its control arising from any cause covered by any
property insurance required to be carried by such waiving party hereunder or
actually carried by such waiving party, to the extent of the limits of such
property insurance. The foregoing waiver shall be effective only so long as it
does not invalidate any insurance coverage carried by the waiving party and
only so long as it is permitted by such party's insurance carrier without
payment of an additional premium, but if such waiver is available at an
additional premium, the party benefiting therefrom shall have the right to pay
the additional premium for such waiver.
SECTION 6.08 BANKRUPTCY. Landlord and Tenant understand that
notwithstanding certain provisions to the contrary contained herein, a trustee
or debtor in possession under the Bankruptcy Code of the United States (the
"Bankruptcy Code") may have certain rights to assume or assign this Lease.
Landlord and Tenant further understand that in any event Landlord is entitled
under the Bankruptcy Code to adequate assurances of future performance of any
such assumption or assignment. The parties hereto agree that the term "adequate
assurance" shall include at least the following:
A. In order to assure Landlord that the proposed
assignee will have the resources with which to pay the rent called for
herein, any proposed assignee must have demonstrated to Landlord's
satisfaction a net worth (as defined in accordance with generally
accepted accounting principles consistently applied) at least as great
as the net worth of Tenant on the date this Lease became effective
increased by seven percent (7%) for each year from the effective date
of the Lease through the date of the proposed assignment. The
financial condition and resources of Tenant were a material inducement
to Landlord in entering into this Lease.
B. Any proposed assignee must have been engaged in
the permitted use for at least five (5) years prior to any such
proposed assignment.
C. In entering into this Lease, Landlord considered
extensively the permitted use and determined that such permitted use
would add substantially to Landlord's tenant balance and that if it
were not for Tenant's agreement to make only the permitted use of the
Premises, Landlord would not have entered into this Lease. Landlord's
overall operation will be substantially impaired if the trustee in
bankruptcy or any assignee of this Lease makes any use of the Premises
other than the permitted use.
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D. Any proposed assignee of this Lease must assume
and agree to be personally bound by the terms, provisions, and
covenants of this Lease.
ARTICLE 7
MISCELLANEOUS PROVISIONS
SECTION 7.01 LATE CHARGES. In addition to all other remedies
provided Landlord, any and all payments, whether for rentals due or other
charges, adjustments or assessments, which shall remain unpaid by the fifth
(5th) day of the month in which such payments shall be due shall bear interest
at the rate of 18% annually.
SECTION 7.02 HOLDING OVER. If, with Landlord's written
consent, Tenant remains in possession of the Premises after the expiration or
other termination of the Term, Tenant shall be deemed to be occupying the
Premises on a month-to-month tenancy only, at a monthly rental equal to one and
one-half times the Minimum Rent as determined in accordance with the terms of
this Lease or such other rental as may be agreed to in writing, and such
month-to-month tenancy may be terminated by Landlord or Tenant on the last day
of any calendar month by delivery of at least ten (10) days advance notice of
termination to the other.
If, without Landlord's written consent, Tenant remains in
possession of the Premises after the expiration or other termination of the
Term, Tenant shall be deemed to be occupying the Premises upon a tenancy at
will only, at a monthly rental equal to two times the Minimum Rent determined
in accordance with the terms of this Lease. Such tenancy at will may be
terminated by Landlord at any time by notice of termination to Tenant, and by
Tenant on the last day of any calendar month by at least three (3) days advance
notice of termination to Landlord.
Any month-to-month tenancy or tenancy at will hereunder shall
be subject to all other terms and conditions of this Lease, except that any
rights of renewal, extension or expansion contained in this Lease shall all
automatically and immediately terminate and be void and of no further force or
effect, and nothing contained in this Section shall be construed to limit or
impair any of Landlord's rights of re-entry or eviction or constitute a waiver
thereof. In addition, Landlord shall be entitled to the benefit of all legal
remedies that may be in force or may be hereinafter enacted relating to the
speedy repossession of the Premises.
SECTION 7.03 NOTICES.
A. All rent and other payments required to be made
by Tenant shall be payable to Landlord, as required below, at the
appropriate address set forth below.
B. All payment required to be made by Landlord to
Tenant shall be payable to Tenant in the manner and at the address set
forth below.
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C. Any notice or document required or permitted to
be delivered by this Lease shall be deemed to be delivered (whether or
not actually received) when deposited in the United States Mail,
postage prepaid, certified mail, return receipt requested, addressed
to the parties at the respective addresses for notices set out below
or when delivered in person to same.
D. Either party hereto may change either the payment
or notice address at any time by giving notice thereof to the other
party in accordance with C. above.
<TABLE>
<CAPTION>
LANDLORD: TENANT:
<S> <C> <C>
Sorrento West Properties, Inc. Oceanic Exploration Company
FOR PAYMENTS: FOR PAYMENTS:
Payable To: Payable To:
Sorrento West Properties, Inc. Oceanic Exploration Company
Address To: Address To:
7800 East Dorado Place, Suite 250 7800 East Dorado Place, Suite 250
Englewood, CO 80111 Englewood, CO 80111
FOR NOTICES: FOR NOTICES:
Name: Name:
Sorrento West Properties, Inc. Oceanic Exploration Company
Address: Address:
7800 East Dorado Place, Suite 250 7800 East Dorado Place, Suite 250
Englewood, CO 80111 Englewood, CO 80111
</TABLE>
SECTION 7.04 AUTHORITY OF TENANT. If Tenant is a corporation,
each individual executing this Lease on behalf of said corporation represents
and warrants that he is duly authorized to execute and deliver this Lease on
behalf of said corporation in accordance with a duly adopted resolution of the
Board of Directors of said corporation or in accordance with the By-Laws of
said corporation, and that this Lease is binding upon said corporation in
accordance with its terms. In addition, Tenant shall, within thirty (30) days
after the execution of this Lease, deliver to Landlord a certified copy of a
resolution of the Board of Directors of said corporation authorizing or
ratifying the execution of this Lease.
SECTION 7.05 FINANCIAL STATEMENTS. Tenant shall furnish, from
time to time when requested by Landlord, a statement of financial condition of
Tenant in form reasonably satisfactory to Landlord.
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SECTION 7.06 VENUE. All monetary obligations of Landlord and
Tenant (including, without limitation, any monetary obligation of Landlord or
Tenant for any breach of the respective covenants, duties, or obligations of
Landlord or Tenant hereunder) are performable exclusively in Arapahoe County,
State of Colorado and Landlord and Tenant agree that the venue for all actions
or causes of actions relating to this Lease shall be in Arapahoe County, State
of Colorado. Each party waives all rights to claim that venue for any such
action or cause of action lies in any place other than Arapahoe County, State
of Colorado.
SECTION 7.07 STATUTORY REMEDIES WAIVER. Tenant hereby waives
and releases each and all rights it may not or in the future have under civil
statutes, including, but not limited to, any rights Tenant may have had to a
lien against Landlord's property or rents due under the Lease in the event of a
breach by Landlord of the terms of this Lease.
SECTION 7.08 AUTHORITIES FOR ACTION. Landlord may act in any
matter provided for herein by its Property Manager and any other person who
shall from time to time be designated by Landlord by notice to Tenant. Tenant
shall designate in writing one or more persons to act on its behalf in any
matter provided for herein and may from time to time change, by notice to
Landlord, such designation. In the absence of any such designation, the person
or persons executing this Lease for Tenant shall be deemed to be authorized to
act on behalf of Tenant in any matter provided for herein.
SECTION 7.09 BROKERAGE. Tenant warrants that it has had
dealings only with N/A ("Broker") and/or with Landlord and its direct
employees, and no other broker or agent, in connection with the negotiation or
execution of this Lease and Tenant agrees to indemnify Landlord and hold
Landlord harmless from and against any and all costs, expenses or liability for
commissions or other compensation or charges with respect to this Lease claimed
by any broker or agent, other than Broker, who claims to have dealt with Tenant
or Tenant's agents. Landlord will pay Broker a commission in connection with
this Lease pursuant to separate agreement between Landlord and Broker.
SECTION 7.10 DEFINITION OF LANDLORD. The term "Landlord" as
used in this Lease means only the owner for the time being of the Building or
the owner of a lease of the entire Building. In the event of any transfer of
title to or lease of the Building, the Landlord shall be and hereby is entirely
freed and relieved of all covenants and obligations of Landlord hereunder.
SECTION 7.11 ENTIRE AGREEMENT. This Lease contains the entire
agreement between the parties, and any attempt hereafter made to change,
modify, discharge or effect an abandonment of it in whole or in part shall be
void and ineffective unless in writing and signed by the party against whom
enforcement of the change, modification, discharge or abandonment is sought.
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SECTION 7.12 JURY TRIAL WAIVER. Landlord and Tenant do hereby
waive trial by jury in any action, proceeding or counterclaim brought by either
of the parties hereto against the other on any matter whatsoever arising out of
or in any connection with this Lease, the relationship of Landlord and Tenant,
Tenant's use or occupancy of the Premises, and/or any claim, injury or damage,
or any emergency or statutory remedy.
SECTION 7.13 FORCE MAJEURE. If, by reason of a strike, labor
troubles or other cause beyond Landlord's control, including, but not limited
to, governmental preemption in connection with a national emergency or any
rule, order or regulation or any action or lack thereof of any governmental
authority, or conditions of supply and demand or acts of God, Landlord shall be
unable to fulfill its obligations under this Lease or shall be unable to supply
any service which Landlord is obligated to supply, this Lease and Tenant's
obligation to pay Minimum Rent and other charges hereunder shall in no way be
affected, impaired or excused.
SECTION 7.14 SEVERABILITY. If any term or provision of this
Lease or the application thereof to any person or circumstances shall, to any
extent, be invalid or unenforceable, the remainder of this Lease, or the
application of such term or provision to persons or circumstances other than
those to which it is held invalid or unenforceable, shall not be affected
thereby and all other terms and provisions of this Lease shall be valid and
enforced to the fullest extent permitted by law.
SECTION 7.15 NO OFFER, OPTION, ETC. The submission of this
Lease to Tenant for examination does not constitute by Landlord a reservation
of, or option to Tenant for, the Premises, or an offer to lease on the terms
set forth herein, and this Lease shall become effective as a Lease Agreement
only upon execution and delivery thereof by Landlord and Tenant.
SECTION 7.16 RELATIONSHIP OF PARTIES. Nothing contained in
this Lease shall create any relationship between the parties hereto other than
that of Landlord and Tenant, and it is acknowledged and agreed that Landlord
does not in any way or for any purpose become a partner of Tenant in the
conduct of its business, or a joint venture or a member of a joint or common
enterprise with Tenant.
SECTION 7.17 NAME OF BUILDING. Landlord shall have the right,
after thirty (30) days' notice to Tenant, to designate or change the name or
numbers of the Building, during the Term without liability to Tenant.
SECTION 7.18 SUCCESSORS BOUND. Except as otherwise
specifically provided, the covenants, terms and conditions contained in this
Lease shall apply to and bind the heirs, successors, executors, administrators
and assigns of the parties hereto.
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SECTION 7.19 INTERPRETATION.
A. If, and to the extent that, any of the provisions
of any Exhibit to this Lease conflict or are otherwise inconsistent
with any of the other provisions of this Lease, or conflict with the
Rules and Regulations appended to this Lease, whether or not such
inconsistency is expressly noted in the Exhibit, the provisions of the
Exhibit shall prevail.
B. The parties mutually agree that the headings and
captions contained in this Lease are inserted for convenience of
reference only, and are not to be deemed part of or to be used in
construing this Lease.
C. This Lease has been executed and delivered in the
State of Colorado and shall be construed in accordance with the laws
of the State of Colorado, and Landlord and Tenant acknowledge that all
of the applicable statutes of the State of Colorado are superimposed
on the rights, duties and obligations of Landlord and Tenant hereunder
and this Lease shall not otherwise provide that which said statutes
prohibit.
D. Landlord has made no representations or promises
with respect to the Premises or the Building except as expressly
contained herein. Tenant has inspected the Premises and agrees to take
the same in an "as is" condition, except as otherwise expressly set
forth. Landlord shall have no obligation, except as herein set forth,
to do any work in and to the Premises to render them ready for
occupancy and use by Tenant.
SECTION 7.20 RESTRICTIVE COVENANTS. This Lease is subject to
the terms of, and Tenant's use of the Premises is controlled by any restrictive
covenants which appear of record. In the event of a conflict between this Lease
and said instruments, the terms of the instruments shall control. Tenant shall
execute any documents reasonably required to evidence the priority of such
instruments.
SECTION 7.21 TIME OF THE ESSENCE. Time is of the essence
hereof, and each party shall perform its obligations and conditions hereunder
within the time hereby required.
SECTION 7.22 EASEMENTS. The Landlord shall have the right to
grant any easements on, over, under and above the Premises for such purposes as
Landlord determines, provided that such easements will not materially interfere
with Tenant's business.
SECTION 7.23 ENLARGING THE BUILDING. Tenant acknowledges that
the Landlord hereby reserves the right from time to time to enlarge the
Building by constructing other buildings on portions of the Property with or
without any new parking or common areas, and by including within the existing
Building other properties now or hereafter owned by Landlord adjacent to the
Property, and constructing on such additional property buildings and parking
areas and common areas. In this event, such new buildings, properties, common
areas and parking areas shall be treated as though they were originally a part
of the Building and at the election of Landlord all common expenses, utility
costs, real property taxes and other pro rata payments herein required of
Tenant
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shall be applicable to such enlarged area and all improvements now or hereafter
thereon; provided that in such event Tenant's pro rata share shall be
appropriately adjusted to include any additional square footage contained in
such new buildings or comprising additional properties added to the Building.
Until Landlord makes such election, Tenant's pro rata share shall continue as
though such enlargement had not occurred.
SECTION 7.24 LIMITATION OF LANDLORD LIABILITY. In no event
shall Landlord be liable to Tenant for any failure of any other tenant in the
Building to operate its business. Notwithstanding anything to the contrary
provided in this Lease, it is specifically understood and agreed, such
agreement being a primary consideration for the execution of this Lease by
Landlord, that there shall be absolutely no personal liability on the part of
Landlord, or any owners of an interest in Landlord's business, their
successors, assigns, legally appointed representatives, or any mortgagee in
possession (for the purposes of this paragraph collectively referred to as
"Landlord") with respect to any of the terms, covenants and conditions of this
Lease, and that Tenant shall look solely to the equity of Landlord in the
Building of which the Premises are a part for the satisfaction of each and
every remedy of Tenant in the event of any breach by Landlord of any of the
terms, covenants and conditions of this Lease to be performed by Landlord, such
exculpation of liability to be absolute and without any exception whatsoever.
Landlord's liability shall be further limited in that, Landlord shall be liable
only to the extent of its insurance and no event or circumstance shall obligate
Landlord to expend funds in excess of such insurance.
SECTION 7.25 NO RECORDATION; NOTICE TO MORTGAGEE. Tenant
agrees not to place this Lease or any memorandum of this Lease of record.
Tenant agrees to an assignment by Landlord of rents and of the Landlord's
interest in this Lease to a mortgagee, if the same be made by Landlord. Tenant
further agrees that Tenant will give to said mortgagee a copy of any requests
for performance by Landlord or notice of default by Landlord; and in the event
Landlord fails to cure such default, the Tenant will give said mortgagee a
reasonable period in which to cure the same. Said period shall begin with the
last day on which Landlord could cure such default, before Tenant has the right
to exercise any remedy by reason of such default.
SECTION 7.26 Rules and Regulations. The Rules and Regulations
in Exhibit F have been adopted by Landlord for the safety, benefit, and
convenience of all tenants and other persons in the Building. Tenant shall at
all times comply with, and shall cause its employees, agents, licensees and
invitees to comply with, the Rules and Regulations from time to time in effect.
Landlord may from time to time, for the purpose set out in this Article, amend,
delete from, or add to the Rules and Regulations, provided that any such
modification:
A. shall not be in conflict with any other provision
of this Lease;
B. shall be reasonable and have general application
to all tenants in the Building; and
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C. shall be effective only upon delivery of a copy
thereof to Tenant at the Lease Premises or posting the same upon a
conspicuous place within the Building or Property upon which the
Building is situate.
Landlord shall use its best efforts to secure compliance by
all tenants and other persons with the Rules and Regulations from time to time
in effect, but shall not be responsible to Tenant for failure of any person to
comply with such Rules and Regulations.
SECTION 7.27 SALE, CONVEYANCE AND ASSIGNMENT. Subject only to
Tenant's rights under this Lease, nothing in this Lease will restrict
Landlord's right to sell, convey, assign or otherwise deal with the Building or
Landlord's interest under this Lease. A sale, conveyance or assignment of the
Building will automatically release Landlord from liability under this Lease
from and after the effective date of the transfer, except for any liability
relating to the period prior to such effective date; Tenant will look solely to
landlord's transferee for performance of Landlord's obligations relating to the
period after such effective date. This Lease will not be affected by any such
sale, conveyance or assignment, and Tenant will attorn to Landlord's
transferee.
SECTION 7.28 RELOCATION. If the Premises contain less than
10,000 square feet of area, Landlord shall have the right, at its option, upon
at least sixty (60) days' written notice to Tenant, to relocate Tenant and to
substitute for the Premises other space in the Building containing at least as
much Area as the original Premises, which space thereafter shall be the
Premises demised by this Lease. Such substituted Premises shall be improved by
Landlord at its expense, with decorations and improvements at least equal in
quantity and quality to those in the original Premises. Landlord shall pay the
expenses reasonably incurred by Tenant in connection with such substitution of
Premises, including, but not limited to, costs of moving, door lettering and
telephone relocation.
In the event of such relocation, this Lease shall continue in
full force and effect without any change in terms or other conditions, but with
the new location, square footage (area) and percentage share substituted for
that set forth in this Lease.
SECTION 7.29 INABILITY TO PERFORM; COVENANTS INDEPENDENT.
This Lease and the obligations of Tenant hereunder shall not be affected or
impaired because Landlord is unable to fulfill any of its obligations hereunder
or is delayed in doing so. It is the intent of the parties that this Lease be
construed as if the covenants herein between Landlord and Tenant are
independent and are not dependent and that rent shall be payable without
offset, reduction or abatement for any cause except as otherwise specifically
provided in this Lease. In the event that Landlord shall be liable to Tenant
for any sums or other matters, either arising out of this lease or otherwise,
Tenant shall not have the right to offset or deduct such liability of Landlord
to Tenant against or from the rent due to Landlord or others pursuant to the
terms of this Lease.
SECTION 7.30 CUMULATIVE REMEDIES. No remedy or election of or
by Landlord hereunder shall be deemed exclusive but shall, whenever possible,
be cumulative with all other remedies at law or in equity.
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SECTION 7.31 ATTORNEY'S FEES. In the event any action or
proceeding is brought by either party against the other under this Lease, the
prevailing party, whether by judgment or out of court settlement, shall be
entitled to recover the fees of its attorneys in such action or proceeding,
including costs of appeal, if any, plus court costs and other expenses of
litigation. In addition, should it be necessary for Landlord to employ legal
counsel to enforce any of the provision herein contained, Tenant agrees to pay
all attorneys' fees, court costs, and other expenses of litigation reasonably
incurred by Landlord.
SECTION 7.32 CONTINUING LIABILITY. No termination or
expiration of this Lease shall relieve Tenant of any obligation to pay or
reimburse sums to Landlord or to indemnify or hold Landlord harmless from any
damage or liability, where such obligation accrues or arises prior to such
termination or expiration of this Lease, and Tenant shall be required to
perform such obligations notwithstanding such termination or expiration.
SECTION 7.33 NO MERGER. The voluntary or other surrender of
this Lease by Tenant, or a mutual cancellation hereof, shall not work a merger
of this Lease, unless Landlord otherwise elects, and shall either terminate any
or all existing sublease or concessions, or operate as an assignment thereof to
landlord, whichever Landlord shall elect.
SECTION 7.34 DEFINITION OF LEASE. "Lease" or "this Lease"
shall mean and consist of this Lease Agreement and the following Exhibits which
by this reference are incorporated herein:
Exhibit A: Legal Description
Exhibit B: Drawing
Exhibit C: Rules and Regulations
TENANT: LANDLORD:
OCEANIC EXPLORATION COMPANY SORRENTO WEST PROPERTIES, INC.
By: By:
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Name: Janet A. Holle Name: Charles N. Haas
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Title: Vice President Title: Vice President
-------------------- --------------------
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