STANDARD INDUSTRIAL LEASE
THIS LEASE, made this day of April 2000, by and between Mesilla Valley
Business Park, LLC (hereinafter "Landlord") and Frontier Airlines, Inc.
(hereinafter "Tenant").
W I T N E S S E T H:
In consideration of the rents, covenants and agreements herein set
forth, Landlord and Tenant enter into the following agreement:
1. Definitions and Key Provisions. The following terms shall be defined in
this Lease as follows:
Premises: The space in the Building outlined on Exhibit "A" consisting
of approximately * square feet of interior building space plus
the approximately * of an acre (for * additional automobile
parking spaces) designated as parking for Tenant's use as
identified on the Site Plan attached hereto as Exhibit "B" (said
acreage and any changes thereto as provided herein being called
the "Additional Parking Area").
Premises Area: * square feet.
Project: The real estate and improvements including the approximately
* square foot building (the "Building") as shown on Exhibit "A"
and municipally numbered as 1630 Hickory Loop, Las Cruces, NM.
The "Project" includes the Additional Parking Area.
Tenant's Share: * (*) of the Operating Expenses attributable to the
Project exclusive of the Additional Parking Area and * (*%) of
the Operating Expenses attributable to the Additional Parking
Area.
Use: Airline Call and Reservation Center and/or any other lawful
office use.
Term:* (*) months unless terminated earlier as provided herein
commencing on the Rent Commencement Date.
Rent Commencement Date: The earlier of the date Tenant opens for
business in the Premises or Substantial Completion of Landlord's
Work as provided in Section 31.
Base Rent: Months * and * $ * per month
Months * through * $ * per month
Months * through * $ * per month
Months * through * $ * per month
Security Deposit: $*
Broker: CB Richard Ellis - Chris Hook
2. Granting Clause. In consideration of the obligation of Tenant to pay rent
as herein provided and in consideration of the other terms, covenants and
conditions hereof, Landlord leases to Tenant, and Tenant takes from
Landlord, the Premises for the Term hereof.
3. Quiet Enjoyment. Notwithstanding the fact that the Rent Commencement Date
is subsequent to the effective date of this Lease, it is the intention of
Landlord and Tenant that each have vested rights hereunder and that this
Lease constitutes a binding and valid obligation of each as of the date
this Lease is fully executed. Tenant shall peaceably and quietly have, hold
and enjoy the Premises for the term, for the Use specified in Section 1
hereof subject, however, to all of the terms hereof and to all reservations
in favor of Landlord, all zoning ordinances and other laws and regulations
governing or regulating the use of the Premises, and all easements,
rights-of-way, and recorded instruments which affect the Premises. Landlord
represents and warrants that it has full right and authority to enter into
this Lease.
4. Security Deposit. Concurrently with Tenant's execution of this Lease,
Tenant shall deposit with Landlord the Security Deposit referenced in
Section 1 which shall be held by Landlord, without obligation for interest
or segregation, as security for performance of Tenant's covenants and
obligations under this Lease, it being expressly understood and agreed that
the Security Deposit is not an advance rental deposit or a measure of
Landlord's damages in case of Tenant's default. Upon the occurrence of any
default by Tenant, Landlord may, without prejudice to any other available
remedy, use such fund to make good any rent arrearage or any other damage,
injury, expense or liability caused by such event of default, and Tenant
shall pay the Landlord within * (*) business days of written demand
therefore, the amount so applied in order to restore the Security Deposit
to its original amount. If Tenant is not then in default hereunder, any
remaining balance of such deposit shall be returned by Landlord to Tenant *
(*) days after the termination of this Lease.
5. Rent.
5.1 Base Rent. Tenant shall pay Base Rent to Landlord for the Premises in the
amounts set forth in Section 1. Said Base Rent shall be paid in advance on
the first day of each month of the Term, with proration to occur for any
partial month if the Rent Commencement Date is other than on the first day
of a calendar month. Payments received by Landlord within the first * (*)
days of any month shall not constitute an event of default hereunder.
Simultaneous with Tenant's execution of this Lease, it shall prepay the
Base Rent for Month * (*) (*). All rentals to be paid by Tenant to Landlord
shall be in lawful money of the United States of America and shall be paid
without deduction or offset, prior notice or demand, on or before the first
day of each and every month during the Term, and at such place or places as
may be designated from time to time by Landlord. Tenant's obligation to pay
rent under this Lease is an independent covenant and no act or
circumstance, regardless of whether such act or circumstance constitutes a
breach of this Lease by Landlord, shall release Tenant of its obligation to
pay rent as required by this Lease. Notwithstanding the fact that the Rent
Commencement Date may be subsequent to the effective date of the Lease, it
is the intention of Landlord and Tenant that each have vested rights
hereunder and that this Lease constitutes a binding and valid obligation of
each as of the date this Lease is fully executed. Payments received by
Landlord within the first * (*) days of any month shall not constitute an
event of default hereunder.
5.2 Operating Expense Payments. It is the intention of Landlord and Tenant that
Landlord receive the Base Rent "net" of all other charges except as
expressly provided herein; accordingly, beginning on the Rent Commencement
Date, Tenant shall pay as additional rent Tenant's Share of the "Operating
Expenses" for the Project. The term "Operating Expenses" shall mean all
reasonable costs and expenses incurred by Landlord with respect to the
ownership, maintenance and operation of the Project, including but not
limited to: Taxes (as provided in Section 11); Insurance (as provided in
Section 14); utilities; maintenance, repair and replacement of all portions
of the Project, including without limitation, signs, fire suppression
systems (if any), repair or replacement of exterior surfaces, including but
not limited to painting, cleaning and graffiti removal, paving of parking
areas and roads, roof (routine maintenance and repair only), alleys,
landscaping, line painting, utility lines, lighting, electrical systems;
amounts paid to contractors and subcontractors for work or services
performed in connection with the foregoing; reasonable property management
fees (not to exceed *% of gross rent payments) (which, at Landlord's
option, may be payable to itself, an affiliate or third party manager);
deductibles on insurance loss; security services, if any; trash collection
and sweeping and compliance with laws, rules, regulations and orders of
governmental authorities. Operating Expenses do not include debt service
under mortgages; depreciation on the building; costs of restoration to the
extent of net insurance proceeds received by Landlord with respect thereto;
leasing commissions; or the cost of renovating space for other tenants of
the Project or capital expenditures unless incurred by Landlord with a
principal purpose to: (i) effect a reduction in the Operating Expenses; and
(ii) keep the Project in compliance with applicable laws, rules,
regulations and orders of governmental authorities; or any other expenses
which, in accordance with generally accepted accounting principles,
consistently applied, would not be treated as operating costs by comparable
landlords of comparable buildings or projects. The costs of additions or
alterations which are required to be capitalized for federal income tax
purposes shall be amortized on a straight line basis over a period equal to
the lesser of the useful life thereof for federal income tax purposes or *
(*) years. The portion of Operating Expenses attributable to the Additional
Parking Area shall be determined by Landlord in its reasonable discretion.
For purposes of allocating taxes on the land, the Additional Parking Area
will be treated as consisting of * (*) of an acre. Landlord may at its
option increase Tenant's Share of the Operating Expenses (or any portion
thereof) if in Landlord's reasonable opinion a disproportionate allocation
is necessary because of Tenant's use or operation.
Landlord shall furnish Tenant, at the inception of the Lease and on an
annual basis or upon any significant change in operating expenses, a written
statement estimating Tenant's Share of the Operating Expenses for the current
calendar year (herein the "Estimate"). Beginning on the Rent Commencement Date
and on the first day of each month during the Term, Tenant shall pay Landlord as
additional rent * (*) of the Estimate. After Tenant's receipt of notice of any
change in the estimate, Tenant shall have * (*) days to pay Landlord any amounts
due to Landlord for the cumulative difference between the amount paid by Tenant
based upon the previous estimate and the amount due Landlord based upon the new
estimate which has accrued since the date of Tenant's receipt of the prior
notice. As soon as practical after the end of each calendar year, Landlord shall
furnish Tenant a written statement showing Tenant's Share of the total Operating
Expenses actually due for the calendar year ended (the "Actual Expenses"). If
the Actual Expenses exceed the Estimate, then Tenant agrees to pay within * (*)
business days of receipt of said statement, the difference between Tenant's
Share of the Actual Expenses and the Estimate. If the Estimate exceeds the
Actual Expenses, then Landlord agrees to refund the difference at the time that
such statement is furnished, provided Tenant is not then in default in the
performance of any of its obligations under this Lease. The provisions of this
Section shall apply for any partial calendar year during which this Lease is
effective, subject to a pro rata adjustment based upon the number of calendar
months or portions thereof that this Lease is in effect. Tenant's obligation to
pay and Landlord's obligation to reimburse such difference shall survive the
termination or expiration of this Lease.
For purposes of this Section, a year shall mean a calendar year except for
the first year of this Lease, which shall begin on the Rent Commencement Date
and the last year which shall end at the expiration of the Lease.
Tenant shall have the right to audit Landlord's books and records detailing
Operating Expenses for the Project for the prior year. Any such audit will be
scheduled on reasonable prior notice to Landlord and shall occur at Landlord's
address as provided on the signature page of this Lease. Tenant will conduct any
such audit within * (*) days of Landlord's delivery of the statement of Actual
Expenses. Tenant shall provide Landlord with a copy of such audit. If the audit
discloses an underpayment by Tenant, it shall promptly pay said amount to
Landlord. If the audit correctly reflects an overpayment by Tenant, Landlord
shall promptly refund such overpayment to Tenant. If the overpayment is more
than * (*), Landlord shall pay to Tenant the reasonable costs of such audit.
5.3. Late Charges. Tenant agrees to pay a late charge of * (*) as additional
rent for each payment due hereunder that remains unpaid for more than * (*)
days after the due date to cover Landlord's administrative costs of
processing such late payment. In addition to said late charge, any rental
or other amount due from Tenant under this Lease which is more than * (*)
days delinquent shall bear interest from the date such rental or other
amount was due at the lesser of the rate of * (*) per year or the then
maximum nonusurious rate under applicable law, (the lesser of said amounts
being herein referred to as the "Maximum Rate.") In the event the late
charge is ever deemed to be "interest" the amount of interest on past due
amounts shall be automatically reduced so that the combination of said late
charge and the interest on past due amounts, if any, does not exceed the
Maximum Rate. Any amount collected which exceeds the Maximum Rate will be
deemed credited to other amounts owed by Tenant to Landlord under this
Lease, and any remaining excess after such credit shall be refunded to
Tenant. It is the intent of both Landlord and Tenant to at all times comply
with the applicable law regarding the maximum nonusurious amount or rate of
interest which may be contracted for, charged, taken, reserved or received
by Landlord. Any rental and/or other payments due hereunder returned to
Landlord marked "Insufficient Funds" will entitle Landlord to collect an
additional $* from Tenant for each such payment.
6. Conduct of Business of Tenant.
6.1. Use of Premises. The Premises shall be occupied and used by Tenant solely
for the purpose of conducting therein the Use authorized in Section 1 and
for no other purpose without Landlord's prior written consent, which will
not be unreasonably withheld. Tenant's acceptance of occupancy from
Landlord shall constitute acknowledgment by Tenant that Tenant has
inspected the Premises and the Project of which the Premises are a part and
that same are suitable for Tenant's intended use thereof as stated in this
Paragraph. Tenant recognizes and agrees that Landlord is making no
warranties, expressed or implied, as to the suitability of the Premises or
the Project for any particular use. Unless otherwise expressly set forth in
this Lease, Tenant accepts the space "AS IS" with all faults.
6.2. Operation by Tenant. Tenant covenants and agrees to the following:
(a) Tenant, at Tenant's expense, shall comply with all present and future
laws, rules, orders, ordinances, directions, regulations and
requirements of federal, state, county and municipal authorities
regardless of when they become effective, pertaining to Tenant's use
or occupancy of the Premises and with any recorded covenants,
conditions and restrictions (copies of said covenants conditions &
restrictions will be provided to Tenant by Landlord prior to the
execution hereof), all applicable federal, state and local laws,
regulations or ordinances pertaining to air, soil and water quality,
Hazardous Materials (as defined in Section 29.3 hereof), waste
disposal, air emissions and other environmental, health and safety,
zoning and land use matters, the Americans with Disabilities Act or
similar laws and with any directive or order of any public officer or
officers, pursuant to law, which impose any duty upon Landlord or
Tenant with respect to the use or occupancy of the Premises;
(b) Tenant shall comply with all requirements of any authority or agency
having jurisdiction over the insurance rates with respect to the use
or occupancy of the Premises;
(c) Landlord shall have the exclusive right to use the roof, side and rear
walls of the Premises for any purpose, including but not limited to
erecting signs or other structures on or over all or any part of the
same, erecting scaffolds and other aids to the construction and
installation of the same, and installing, maintaining, using,
repairing, and replacing pipes, ducts, conduits and wires leading
through, to or from the Premises and serving other parts of the
Project in locations which do not materially interfere with Tenant's
use of the Premises. Tenant shall have no right whatsoever to the
exterior or exterior walls, or the roof of the Premises or any portion
of the Project outside the Premises, except as otherwise provided in
this Lease. Notwithstanding the foregoing, Tenant shall have the right
to install satellite antennas and other related communications
equipment on the roof, immediately above Tenant's premises, at
Tenant's sole cost and expense, provided that (1) such antennas and
equipment comply with all applicable laws, ordinances and rules and
regulations; (2) Landlord shall have the right to approve the plans
therefore, which Landlord will not unreasonably withhold provided any
roof penetrations will not void Landlord's warranties on the roofing
system; and (3) such antennas and equipment do not overload the load
bearing capacity of the walls or roofing system. (d) Tenant agrees
that it shall not use or permit the Premises to be used for an adult
book store, adult motion picture theater, nude or semi-nude
entertainment club, or similar adult entertainment establishment.
7. Rules and Regulations. Tenant and Tenant's agents, employees, and invitees
shall faithfully observe and comply with all reasonable, uniform rules and
regulations promulgated by Landlord from time to time for the safety, care
or cleanliness of the Project for the preservation of good order therein.
Provided, however, Landlord has no obligation to promulgate such rules or
regulations. Landlord shall not be responsible to Tenant for the
nonperformance by any other tenant or occupant of the Project of any of the
rules and regulations. Landlord will use commercially reasonable efforts to
enforce the rules and regulations.
7.1 A. Any rules and regulations imposed by Landlord after the date of this
Lease shall be: (i) reasonable and consistent with rules and regulations
imposed on similar properties; (ii) no more burdensome than the rules and
regulations attached hereto; (iii) subject to the other provisions of this
Lease; (iv) related only to common areas, not the Premises; (v) uniformly
enforced; and (vi) effective only after Tenant has had at least thirty (30)
days prior written notice of their enactment.
8. Parking and Use of Common Area and Facilities.
8.1. Common Area. All parking areas, access roads and facilities furnished, made
available or maintained by Landlord on the Project for the general use in
common of tenants of the Project and their invitees in the Project or the
Premises, including the Additional Parking Area, truck ways, driveways,
loading docks and areas, delivery areas, pickup stations, pedestrian
sidewalks, courts and ramps, landscaped areas, retaining walls, stairways,
hallways, common restrooms, lighting facilities, and other similar areas
and improvements provided by Landlord for the general use in common of
tenants of the Project and their customers (herein collectively called the
"Common Area") shall at all times be subject to the control and management
of Landlord. Tenant acknowledges that it does not have an exclusive
interest in the Common Area. Subject to the terms and conditions of this
Lease concerning the Additional Parking Area, Landlord reserves the right
to grant such easements and other rights in the Common Area as Landlord may
from time to time deem necessary, including without limitation, easements
for mutual ingress and egress, truck turning, utilities, and similar
matters for the benefit of adjacent properties. Landlord may, at its sole
option, modify the Common Areas or make such changes thereto as Landlord
deems reasonably necessary, as long as such modifications do not prevent
Tenant's reasonable access to or use of the Premises as permitted herein.
8.2. Use of Common Area. Subject to the Terms and conditions of this Lease
concerning the Additional Parking Area, Tenant and Tenant's business
invitees, employees and customers shall have the nonexclusive right, in
common with Landlord and all others to whom Landlord has granted or may
hereafter grant rights, to use the Common Area, subject to such reasonable,
uniform rules and regulations as Landlord may from time to time impose and
the rights of Landlord set forth above. Landlord may at any time close
temporarily all or any part of the Common Area to make repairs or changes,
to prevent the acquisition of public rights therein or for any other
reasonable purpose as long as such modifications do not prevent Tenant's
reasonable access to or use of the Premises as permitted herein.. Tenant
shall not interfere with the other tenants' right to use any part of the
Common Area. Landlord shall not be responsible for enforcing Tenant's
parking rights against any third parties. Nothing herein shall obligate
Landlord to maintain or provide any security services or systems for the
Project. Tenant agrees that Landlord shall not be liable to Tenant for, and
Tenant waives any claim against Landlord with respect to, any loss by theft
or any other damage suffered or incurred by Tenant in connection with any
unauthorized entry into the Premises or other criminal or willful acts of
third parties.
8.3. Parking. The "Premises" includes the area identified on Exhibit "B" as the
"Additional Parking Area." Provided Tenant is operating in the Premises for
the Use specified in Section 1, Landlord agrees to make available to Tenant
a total of * (*) exclusive parking spaces (including handicap spaces) as
initially designated on the attached Site Plan as Exhibit "B". Parking
spaces will be marked "Frontier Parking only." Tenant agrees to only use
those exclusive parking spaces marked Frontier Parking, and no other spaces
within the Project or parking areas shown on Exhibit "B". Landlord reserves
the right to reconfigure or relocate the Additional Parking Area and other
parking areas within the Project from time to time provided that parking
available to Tenant within the Project is not diminished to less than *
parking spaces in reasonably close proximity to the Premises, without
Tenant's consent. In the event the square footage of the Additional Parking
Area is reduced as the result of such a reconfiguration, the Additional
Parking Area will nevertheless be treated as consisting of * (*) of an acre
for allocation of real property taxes.
9. Maintenance of Premises.
9.1. Maintenance by Landlord. Landlord shall keep or cause to be kept the
foundations, roof (except for the HVAC System portions thereof as provided
in Section 9.2) and structural portions of the walls of the Premises in
good order, repair and condition except for damage thereto due to the acts
or omissions of Tenant, its agents, employees, contractors or invitees.
Landlord shall commence required repairs as soon as reasonably practicable
after receiving written notice from Tenant thereof. Except as provided in
this Paragraph, Landlord shall not be obligated to make repairs,
replacements or improvements of any kind upon the Premises, or to any
equipment, merchandise, stock in trade, facilities or fixtures therein, all
of which shall be Tenant's responsibility. Without limitation on the
foregoing, Tenant agrees that Landlord shall have no obligation to provide
any janitorial service to the Building.
9.2. Maintenance by Tenant. Tenant shall at all times keep all parts of the
Premises not required herein to be maintained by Landlord in good order,
condition and repair and in a clean, orderly, sanitary and safe condition,
damage by unavoidable casualty excepted. Without limitation on the
foregoing, Tenant's repair and maintenance obligations shall include all
glass, signage, windows, doors, fixtures, equipment and appurtenances
thereof; lighting, electrical and plumbing appurtenances; and all interior
and exterior heating, ventilation and air-conditioning equipment "HVAC
System." Tenant's obligations shall include but not be limited to doing
such things as necessary to cause the Premises to comply with applicable
laws, rules, regulations and orders of governmental and public bodies and
agencies. If replacement of equipment, fixtures and appurtenances thereto
are necessary, Tenant shall replace the same with equipment, fixtures and
appurtenances of the same quality, and shall repair all damages caused by
such replacement. At the termination of this Lease, Tenant shall surrender
the Premises in the same condition as they were on the Commencement Date,
reasonable wear and tear excepted, and deliver all keys for and all
combinations on locks, safes and vaults in the Premises to Landlord.
Notwithstanding the above, Landlord reserves the right upon notice to
Tenant to enter into a maintenance contract with a third party for the
maintenance and repair of all or any portion of the HVAC System. If
Landlord enters into such a contract, Tenant agrees to reimburse Landlord
for all costs associated with such contract within * (*) business days of a
billing therefore.
9.3. Fire Equipment. Tenant agrees to supply and maintain at its own expense any
fire extinguishers required by local ordinance or other fire protection
equipment required as a result of Tenant's use. Landlord to supply and
install any other fire protection equipment required by law or local
ordinance or as desired by Landlord, if such equipment is required for the
building independent of Tenant's use.
9.4. No Consent. Tenant's maintenance and other obligations under this Lease
shall not be construed as granting authority or consent to the Tenant to
create any mechanic's or materialman's lien upon the Property or to
subordinate Landlord's or Landlord's lenders rights.
10. Alterations, Liens and Signs.
10.1.Alterations. Tenant will not paint, decorate or change the architectural
treatment of any part of the exterior of the Premises or construct any
changes to the interior of the Premises, without Landlord's prior written
approval thereto, which approval will not be unreasonably withheld
conditioned or delayed, and will promptly remove any paint, decoration,
alteration, addition or changes applied or installed without Landlord's
approval or take such other action with respect thereto as Landlord
reasonably directs. Tenant shall not make any structural alterations,
additions or changes to the Premises. Tenant may, at its own cost and
expense erect shelves, bins, racks and removable (i.e., not permanently
attached to the realty) trade fixtures (collectively "Trade Fixtures") in
the ordinary course of its business provided such items do not alter the
basic character of the Premises, do not damage the Premises, may be removed
without injury to the Premises and the construction, erection and
installation thereof complies with all legal requirements and other
provisions of this Lease. If Landlord grants consent to any requested
alterations, the alterations shall be performed in a good, workmanlike and
lien free manner in accordance with all applicable legal requirements and
any restrictions which may be imposed by Landlord as a condition to its
consent. All alterations, changes, additions and all leasehold improvements
made by Tenant or made by Landlord on Tenant's behalf and all fixtures
installed by Tenant which are not Trade Fixtures are herein collectively
referred to as "Tenant Additions", and shall be the property of Landlord.
Such Tenant Additions shall not be removed by Tenant on, before or
following expiration or termination of the Lease without Landlord's consent
except as may be required pursuant to Section 27.1.
10.2.Liens. Tenant shall promptly pay all contractors and materialmen, and not
permit or suffer any lien to attach to the Premises or Project or any part
thereof, and indemnify and save harmless Landlord against the same.
Landlord shall have the right to require Tenant to furnish a bond or other
indemnity satisfactory to Landlord prior to the commencement of any work by
Tenant on the Premises costing in excess of $*. If any lien attaches or is
claimed, Tenant, within * (*) days following the imposing of any such lien,
shall cause the same to be released of record by payment or by petition to
cancel the lien and posting such security as is required. Tenant has no
express or implied authority to create or place any lien or encumbrance of
any kind upon, or in any manner to bind the interest of Landlord in the
Premises or Project or to charge the rentals payable hereunder for any
claim in favor of any person dealing with Tenant, including, without
limitation, those who may furnish materials or perform labor for any
construction or repairs.
10.3.Signs. Tenant will not place or permit on any exterior door or window or
any exterior wall of the Premises any sign, awning, canopy, advertising
matter, decoration, lettering or other thing of any kind which does not
comply with the existing Sign Criteria for the Project as set forth in
Exhibit "C" attached hereto. Landlord has installed, at its expense, four
(4) permanent sign(s) in compliance with said Sign Criteria. Tenant agrees
within thirty (30) days of the Rent Commencement Date to have Tenants logo
or lettering placed on existing said box sign(s) on the facade of the
Premises. Tenant shall, at its expenses, maintain such signage. Such
maintenance shall include without limitation, the replacing of light bulbs
and other lighting materials and any broken panels or the like. Tenant
shall keep said sign lit during the operating hours of the Project as such
hours are determined by Landlord regardless of whether Tenant's business is
open during this time. Tenant shall remove such sign upon termination of
this Lease. Such installation and removal shall be done in such a manner as
to avoid injury, defacement or overloading of the Premises. Tenant shall
not be permitted to individually install a street-side sign on its behalf.
11. Real Estate Taxes. Landlord has the sole right to render the Project, land
and any improvements thereon to any appropriate taxing authorities. Tenant,
as additional rent, agrees to pay Tenant's Share of all taxes (both general
and special), assessments, or governmental charges (hereinafter "Taxes")
lawfully levied or assessed against the Premises, Project or any portion
thereof, including without limitation any gross receipts or similar tax and
all taxes on the Additional Parking Area, but specifically excluding
Landlord's income taxes, excess profit taxes, franchise taxes, or similar
taxes on Landlord's business. Tenant's Share of the taxes shall be payable
as additional rent in accordance with Section 5.2. Additionally, Tenant
shall pay to Landlord upon demand, Tenant's Share of all reasonable costs
(including tax consultant and/or attorney's fees) incurred by Landlord in
connection with any protest or contest of the valuation of taxes imposed on
the Project or land. Provided, however, Landlord shall have no obligation
to take any such action. Tenant shall have the right to inspect, at
Landlord's business office during regular business hours and upon
reasonable notice to Landlord, the tax bills which Landlord receives from
the applicable taxing authorities.
12. Personal Property Taxes. During the Term of this Lease, Tenant shall pay
prior to delinquency all taxes assessed against and levied upon fixtures,
furnishings, equipment and all other personal property of Tenant contained
in the Premises. When possible, Tenant shall cause its personal property to
be assessed and billed separately from the real property of Landlord. If
any of Tenant's personal property shall be assessed with Landlord's real
property, Tenant shall pay Landlord the taxes attributable to Tenant within
* (*) business days after receipt of a written statement therefor or, at
Landlord's option as provided in Section 11.
13. Utilities. Tenant agrees to pay before delinquency all charges for all
utilities (including but not limited to gas, water, heat, sewer,
electricity, telephone, garbage removal, water meter charges and all hookup
or connection fees or charges) which may accrue with respect to the
Premises during the Term of this Lease. Additionally, Tenant shall pay to
Landlord, as additional rent, upon demand, Tenant's Share of any utilities
which are not separately metered based upon usage as reasonably determined
by Landlord. Landlord shall in no event be liable to Tenant for any
interruption in the service of any such utilities to the Premises,
howsoever such interruption may be caused and this Lease shall continue in
full force and effect despite any such interruptions. Tenant agrees to
limit use of water and sewer to normal restroom use. Tenant acknowledges
that it has inspected the utilities available to the Premises and that it
has determined that such utilities are sufficient for all anticipated uses
of the Premises. Tenant shall not install any equipment or make any use of
the Premises which overloads the utilities available to the Premises and if
Landlord deems Tenant's use of equipment to be in violation of this
provision, Landlord may, in addition to such other remedies which Landlord
has hereunder, require Tenant, at Tenant's expense, to upgrade such utility
lines and related equipment including without limitation transformers.
14. Insurance; Waiver; Indemnification.
14.1.Landlord's Obligation. During the Term of this Lease and any extension or
renewal hereof, Landlord shall procure and maintain such "all risk property
and general liability" insurance coverage on the Project as Landlord deems
appropriate, but not less than full replacement cost coverage, as
reasonably determined by Landlord, including, if Landlord so elects, loss
of rental insurance in an amount of one or more year's annual rental.
14.2. Tenant's Obligations.
14.2.1. All Risk Property and General Liability. Tenant, as additional rent,
shall pay to Landlord an amount equal to Tenant's Share of all premiums
paid by Landlord for the insurance coverage described in Section 14.1.
Tenant's Share of such premiums is payable as additional rent in accordance
with Section 5.2.
14.2.2. Liability. Tenant shall procure and maintain a policy or policies of
insurance insuring both Landlord and Tenant against all claims, damages or
actions arising out of or in connection with Tenant's use or occupancy of
the Premises or by the condition of the Premises, the limits of such policy
or policies to be in an amount not less than $* per occurrence, and in an
amount not less than $* in the general aggregate for bodily injury and
property damage. Said policy or policies shall additionally include "Fire
Legal Liability" insurance coverage in the maximum allowable amount. Tenant
shall also maintain workman's compensation insurance on its employees in
the required statutory amounts.
14.2.3. Personalty Coverage. Tenant also agrees to carry insurance against fire
and such other risks as are from time to time included in standard extended
coverage insurance, for the full insurable value, covering all of Tenant's
merchandise, trade fixtures, furnishings, wall covering, floor covering,
carpeting, drapes, equipment and all items of personal property of Tenant
located on or within the Premises. All property in the Premises will be
kept at Tenant's risk.
14.2.4. Construction Liability. Tenant, at its own cost and expense, shall
obtain and maintain at all times when demolition, excavation, or
construction work is in progress being done by Tenant (specifically
excluding any of the "Landlord Work" as designated herein) on the Premises,
construction liability insurance with limits of not less than $* and $*
combined single limit in the general aggregate for bodily injury and
property damage, protecting Landlord and Tenant as well as such other
person or persons as Tenant may designate against any and all liability for
injury or damage to any person or property in any way arising out of such
demolition, excavation, or construction work.
14.2.5. Form of Insurance. All policies required of Tenant hereunder shall: (i)
be issued by a reputable insurance company qualified to do business in the
State of New Mexico and with an A.M. Best rating company of not less than
"A-" according to the most recent rating thereof acceptable to Landlord;
(ii) name Landlord as an additional insured and Tenant as a named insured;
(iii) provide that they cannot be canceled for any reason unless Landlord
is given * (*) days prior written notice by the insurer; (iv) state that
such insurance is primary over any insurance carried by Landlord; (v)
contain an endorsement in favor of Landlord, waiving such insurance
company's right of subrogation against Landlord; and (vi) contain a
statement that the current installment of the premium for such policy has
been paid in advance. A duly executed certificate of insurance shall be
delivered to Landlord prior to Tenant's occupancy and will be attached
hereto as Exhibit "D." All renewals shall be delivered to Landlord at least
* (*) days prior to the expiration of the respective policy terms. Landlord
shall have the right to review said insurance amounts at least yearly
during the Term of this Lease and require Tenant to increase said insurance
policies to provide coverage in such amounts as Landlord, in its sole, but
reasonable discretion, deems necessary. Moreover, should Tenant's use of
the Premises (or any vacancy by Tenant) result in an increased insurance
rate, Landlord may, in its discretion allocate such amount of the insurance
premium to Tenant as Landlord deems reasonable to pass the cost of such
increased premium through to Tenant rather than other tenants of the
Project. Tenant agrees to procure and maintain said increased insurance
coverage. The insurance required of Landlord hereunder may be maintained
under a blanket or master policy which includes properties other than the
Project.
14.3.Mutual Waiver of Subrogation Rights. Landlord and Tenant and all parties
claiming under them mutually release and discharge each other and their
respective officers, directors, partners, employees and agents from all
claims and liabilities arising from or caused by any casualty or hazard to
the extent covered by valid and collectible insurance on the Project; and
waive any right of subrogation which might otherwise exist in or accrue to
any person on account thereof; provided that such release shall not operate
in any case where the effect is to invalidate such insurance coverage. This
release shall apply even if the loss or damage shall be caused by the fault
or negligence of a party hereto or for any person for which such party is
responsible.
14.4.Waiver. Landlord, its agents and employees, shall not be liable for, and
Tenant waives all claims for damage (except claims caused by or resulting
from the negligence or willful misconduct of Landlord, its agents or
employees), including but not limited to consequential damages, to person,
property or otherwise, sustained by Tenant or any person claiming through
Tenant resulting from any accident or occurrence in or upon any part of the
Premises or the Project, including but not limited to, claims for damage
resulting from: (a) any equipment or appurtenances becoming out of repair;
(b) injury done or caused by wind, water, or other natural elements; (c)
any defect in or failure of plumbing, heating or air-conditioning
equipment, electric wiring or installation thereof, gas, water, and steam
pipes, stairs, porches, railings or walks; (d) broken glass; (e) the
backing up of any sewer pipe or downspout; (f) the bursting, leaking or
running of any tank, tub, washstand, water, snow or ice upon the Premises
or the Project; (g) the falling of any fixture, plaster or stucco; (h)
damage to or loss by theft or otherwise of property of Tenant or others;
(i) acts or omissions of other persons in the Premises, other tenants in
the Project, occupants of nearby properties, or any other persons; and (j)
any act or omission of owners of adjacent or contiguous property. All
property of Tenant kept in the Premises shall be so kept at Tenant's risk
only and Tenant shall indemnify, defend and save Landlord harmless from
claims arising out of damage to the same, including subrogation claims by
Tenant's insurance carrier.
14.5. Indemnification. Intentionally omitted.
15. Right of Entry. Landlord, its agents and employees, shall have the right to
enter the Premises from time to time at reasonable times to examine, to
show them to prospective purchasers and other persons, and to make such
repairs, alterations, improvements or additions as Landlord deems desirable
as long as Tenant's use of the Premises is not materially disrupted
thereby. Rent shall not abate during any such entry by Landlord, including
without limitation, during the period of any such repairs, alterations,
improvements, or addition unless Tenant's use of the Premises is materially
disrupted thereby and then only to the extent of such disruption. During
the last * (*) months of the Term of this Lease, Landlord may exhibit the
Premises to prospective tenants and maintain upon the Premises notices
deemed advisable by Landlord. In addition, during any apparent emergency,
Landlord, its agents and employees, may enter the Premises forcibly without
liability therefor and without in any manner affecting Tenant's obligations
under this Lease. Nothing herein contained, however, shall be deemed to
impose upon Landlord any obligation, responsibility or liability
whatsoever, for any care, maintenance or repair except as otherwise herein
expressly provided.
16. Subordination and Attornment. Tenant accepts this Lease subject and
subordinate to any mortgage, deed of trust, or other lien presently
existing on the Project or the Land or subsequently created on the Project,
and to any renewals and extensions thereof, but Tenant agrees that any such
mortgagee shall have the right at any time to subordinate such mortgage,
deed of trust, or other lien to this Lease. Landlord is hereby irrevocably
vested with full power and authority to subordinate this Lease to any
mortgage, deed of trust, or other lien hereafter placed on the Project or
the Land, and Tenant agrees on demand to execute such further instruments
subordinating this Lease as Landlord may request, provided such
subordination shall be on the express condition that this Lease shall be
recognized by the mortgagee, and that the rights of Tenant shall remain in
full force and effect during the Term of this Lease so long as Tenant shall
continue to perform all of the covenants and conditions of this Lease. No
such mortgagee shall be required to assume any liabilities for defaults
occurring prior to its ownership of the Project. Tenant covenants and
agrees that upon foreclosure of any deed of trust, mortgage or other
instrument of security and the sale of the Project or the Land pursuant to
any such document, to attorn to any purchaser at such a sale and to
recognize such purchaser as the Landlord under this Lease. The agreement of
Tenant to attorn to any purchaser pursuant to such a foreclosure sale or
trustee's sale in the immediately preceding sentence shall survive any such
sale.
17. Estoppel Certificate. Tenant shall at any time, upon the request of
Landlord, execute, acknowledge and deliver to Landlord a statement in
writing certifying that this Lease is unmodified and in full force and
effect (or if modified stating the nature of such modification and
certifying that the Lease as modified is in full force and effect), the
dates to which the rent and other charges are paid in advance, if any, and
acknowledging that there are not, to Tenant's knowledge, any uncured
defaults on the part of Landlord hereunder, or specifying such defaults if
any are claimed. The parties hereto agree that any such statement may be
relied upon by any prospective purchaser or encumbrancer of all or any
portion of the Project or the Land. Tenant's failure to deliver such
statement within * (*) business days after Landlord's request for the same,
shall be conclusive upon Tenant that: (i) this Lease is in full force and
effect; (ii) this lease has not been modified or amended other than
expressly stated; (iii) there are no uncured defaults in Landlord's
performance; and (iv) not more than one month's rent or other charge has
been paid in advance.
18. Damage and Destruction. If the Premises are hereafter damaged or destroyed
or rendered partially unuseable by Tenant for their accustomed use by fire
or other casualty and such fire or other casualty is not caused directly or
indirectly by the fault or negligence of Tenant, its agents, employees,
contractors or invitees, Landlord shall, unless the Lease is terminated as
below, promptly repair the same to substantially the condition which they
were in immediately prior to the happenings of such casualty (excluding
stock in trade, fixtures, furniture, furnishings, carpeting, floor
covering, wall covering, drapes and equipment), and from the date of such
casualty until the Premises are so repaired and restored, the monthly Base
Rent payments hereunder shall abate in such proportion as the part of said
Premises thus destroyed or rendered unuseable by Tenant bears to the total
Premises. Provided, however, Landlord shall not be obligated to expend for
such repair or restoration an amount in excess of the insurance proceeds
received by Landlord as a result of such damage. Landlord's obligation to
rebuild is contingent upon its receipt of insurance proceeds sufficient to
make such repairs. In the event any mortgagee or lender requires such sums
to be applied to any debt, Landlord will not be deemed to have received the
proceeds. Notwithstanding the above, if the Premises or any portion in
excess of *% of the Building is wholly or partially damaged, destroyed or
rendered unuseable by Tenant for their accustomed use by fire or other
casualty then Landlord or Tenant shall have the right to terminate this
Lease effective as of the date of such casualty by giving to the other
party, within * (*) days after the happening of such casualty, written
notice of such termination. If such notice is given, this Lease shall
terminate and provided Tenant is not in default hereunder, Landlord shall
promptly repay to Tenant any rent theretofore paid in advance which was not
earned at the date of such casualty. If said notice is not given and
Landlord is required or elects to repair or restore the Premises as herein
provided, then Tenant shall promptly repair or replace its stock in trade
fixtures, furnishings, furniture, carpeting, wall covering, floor covering,
drapes and equipment to the same condition as they were in immediately
prior to the casualty. If the Premises or any portion of the Project are
damaged by fire or other casualty caused directly or indirectly by the
fault or negligence of Tenant or its agents, employees, contractors, or
invitees, the rent under this Lease will not abate and Tenant shall be
liable to Landlord for the cost and expense of the repair and restoration
of the Premises or the Project caused thereby to the extent that such cost
and expense is equal to or less than the deductible amount covered by the
insurance proceeds described in Section 14.1.
19. Eminent Domain.
19.1.Eminent Domain. If any material portion of the Premises shall be acquired,
condemned or damaged as a result of the exercise of any power of eminent
domain, condemnation or sale under threat thereof or in lieu thereof to the
extent that the remainder becomes unuseable for its intended purpose, then
Landlord or Tenant at its election may terminate this Lease by giving
notice to the other party of its election, within 180 days of the date the
condemning authority shall have the right to possession of the Premises or
portion of the Project condemned. Moreover, if any material portion of the
Project is taken and in Landlord's judgment such taking would materially
interfere with or impair its ownership or operation of the Project,
Landlord may terminate this Lease. If the Lease shall not be terminated as
aforesaid, then it shall continue in full force and effect, and Landlord
shall within a reasonable time after possession is physically taken by the
condemning authority (subject to delays due to shortage of labor, materials
or equipment, labor difficulties, breakdown of equipment, governmental
restrictions, fires, other casualties or other causes beyond the reasonable
control of Landlord) restore the remaining portion of the Premises to the
extent reasonably possible, to render it reasonably suitable for the Use
permitted by Section 1. Provided, however, Landlord shall not be obligated
to expend an amount greater than the proceeds received from the condemning
authority less all expenses incurred in connection therewith (including
attorney's fees) for the restoration. Base Rent as provided in Section 5.1,
shall be reduced in the proportion that the area of the Premises so taken
bears to the total Premises. No taking of the Common Area shall entitle
Tenant to an abatement of rent, but operating expenses shall be adjusted
accordingly.
19.2.Damages. Landlord reserves and Tenant assigns to Landlord, all rights to
damages on account of any taking or condemnation or sale under threat or in
lieu thereof or any act of any public or quasi-public authority for which
damages are payable. Tenant shall execute such instruments of assignment as
Landlord requires, join with Landlord in any action for the recovery of
damages if requested by Landlord, and turn over to Landlord any damages
recovered in any proceeding. If Tenant fails to execute instruments
required by Landlord, or undertakes such other steps as requested, Landlord
shall be deemed the duly authorized irrevocable agent and attorney-in-fact
of Tenant to execute such instruments and undertake such steps on behalf of
Tenant. However, Landlord does not reserve any damages payable for trade
fixtures installed by Tenant at its own cost which are not part of the
realty, moving expenses and business interruption expense incurred by
Tenant, provided that such items are separately awarded to Tenant.
20. Assignment and Subletting. Tenant shall not assign this Lease or any
interest therein, whether voluntarily, by operation of law, or otherwise,
and shall not sublet the Premises or any part thereof except by written
permission and consent of Landlord being first had and obtained. Consent of
Landlord to any such assignment or subletting shall not be unreasonably
withheld if: (i) at the time of such assignment or subletting Tenant is not
in default in the performance and observance of any of the covenants and
conditions of this Lease; (ii) the assignee or subtenant of Tenant shall
expressly assume in writing all of Tenant's obligations hereunder; (iii)
Tenant shall provide proof to Landlord that the assignee or subtenant has a
financial condition which is satisfactory to Landlord and Landlord's
lender; (iv) the Premises continue to be used solely for the Use set forth
in Section 1, and (v) Landlord is furnished with and approves the form of
the proposed sublease. In connection with any such assignment or sublease,
Tenant or the assignee or subtenant of Tenant shall pay to Landlord any
legal and administrative costs incurred by Landlord in approving such
assignment or subletting, not to exceed $*. Any such assignment or
sublease, even with the approval of Landlord, shall not relieve Tenant from
liability for payment of all forms of rental and other charges herein
provided or from the obligations to keep and be bound by the terms,
conditions and covenants of this Lease. The acceptance of rent from any
other person shall not be deemed to be a waiver of any of the provisions of
this Lease, or a consent to the assignment or subletting of the Premises.
Consent to any assignment or subletting shall not be deemed a consent to
any future assignment or subletting. Any merger, consolidation or transfer
of corporate shares of Tenant, if Tenant is a corporation, so as to result
in a change in the present voting control of the Tenant by the person or
persons owning a majority of said corporate shares on the date of this
Lease, shall constitute an assignment and be subject to the conditions of
this Paragraph. If Tenant is a general partnership having one or more
corporations as partners or if Tenant is a limited partnership having one
or more corporations as general partners, the provisions of the preceding
sentence shall apply to each of such corporations as if such corporation
alone had been the Tenant hereunder. If Tenant is a partnership, the
withdrawal of a general partner shall be an assignment subject to the
provisions hereof. Moreover, in the event that the rental due and payable
by a sublessee or assignee, or a combination of the rental payable under
such sublease or assignment plus any bonus or other consideration therefor
or incident thereto exceeds the rental payable under this Lease, or if with
respect to an assignment, sublease, license or other transfer by Tenant
permitted by Landlord, the consideration payable to Tenant by the assignee,
subtenant, licensee or other transferee exceeds the rental payable under
this Lease, then Tenant shall be bound and obligated to pay Landlord, in
addition to all rental required hereunder, * (*) of such excess rental and
other excess consideration within * (*) days following receipt thereof by
Tenant from such sublessee, assignee, licensee or other transferee, as the
case may be. Finally, in the event of any assignment or subletting it is
understood and agreed that all rentals paid to Tenant by an assignee or
sublessee shall be received by Tenant in trust for Landlord, to be
forwarded immediately to Landlord without reduction of any kind, and upon
election by Landlord such rentals shall be paid directly to Landlord.
Without limitation of Landlord's approval rights as provided above, Tenant
shall provide a copy of any executed sublease to Landlord within * (*) days
of the execution thereof.
20.1 Notwithstanding anything contained in this Lease to the contrary, Tenant
may without the prior consent of Landlord, but with notice to Landlord
within * (*) days of any assignment or sublease, assign or sublease all or
part of the premises, to an affiliate of Tenant, or to any company into
which Tenant may be merged or consolidated, or that acquires substantially
all of the assets of Tenant. Any such assignee shall have a similar right
to assign this Lease to an affiliate of Tenant or to any company into which
Tenant may be merged or consolidated, without the prior consent of
Landlord, but with notice to Landlord within * (*) days of any assignment
or sublease. An "Affiliate" of Tenant shall mean any corporation which
directly or indirectly, controls or is controlled by or is under common
control with Tenant, or a successor corporation to Tenant by merger,
consolidation, or non-bankruptcy reorganization. For purpose of the
definition of "affiliate," the word "control" (including "controlled by"
and under common control with"), with respect to any corporation,
partnership or association, shall mean the possession, directly or
indirectly, of the power to direct or cause the direction of the management
and policy of a particular corporation, partnership or association, whether
through the ownership of voting securities or by contract or otherwise.
Notwithstanding the foregoing, if any such affiliate has a net woth less
than that of Tenant at the time of such proposed assignment, Landlord may
require as a condition to such assignment a guarantee from Frontier
Airlines Inc., or its successor, in a form acceptable to Landlord.
21. Default by Tenant.
21.1.Events of Default. The following shall be considered for all purposes to
be events of default under and a breach of this Lease: (a) any failure of
Tenant to pay any rent or other amount when due hereunder after expiration
of any applicable grace periods therefore as provided in the Lease; (b) any
failure by Tenant to perform or observe any of the other terms, provisions,
conditions and covenants of this Lease for more than * (*) days after
written notice of such failure or if such performance is of a type which
will require more than * (*) days to correct using reasonable diligence,
Tenant fails to commence such cure within * (*) days after notice and
diligently proceed to cure same; (c) Tenant shall become bankrupt or
insolvent, or file or have filed against it a petition in bankruptcy or for
reorganization or arrangement or for the appointment of a receiver or
trustee of all or a portion of Tenant's property, or Tenant makes an
assignment for the benefit of creditors; (d) if Tenant abandons the
Premises; (e) this Lease, Tenant's interest herein or in the Premises, any
improvements thereon, or any property of Tenant is executed upon or
attached; or (f) the Premises come into the hands of any person other than
expressly permitted under this Lease.
21.2.Landlord's Remedies. Upon the occurrence of any event of default specified
in this Lease, Landlord, without grace period, demand or notice (the same
being hereby waived by Tenant), and in addition to all other rights or
remedies Landlord may have for such default, shall have the right to pursue
any one or more of the following remedies:
(a) Terminate this Lease in which event Tenant shall immediately surrender
the Premises to Landlord, and if Tenant fails to do so, Landlord may,
without prejudice to any other remedy which it may have for possession
or arrearages in rent, enter upon and take possession of the Premises
and expel or remove Tenant and any other person who may be occupying
said Premises or any part thereof, by force if necessary, without
notice or the need to resort to legal process and without being deemed
guilty of trespass or becoming liable for any loss or damage
occasioned thereby; and Landlord may recover from Tenant the amount of
all loss and damage which Landlord may suffer by reason of such
termination, including, without limitation, all costs of retaking the
Premises and the total present value (using a discount factor of * (*)
percent) of the total rent and charges reserved in this Lease for the
remainder of the Term of this Lease (i.e., the duration of this Lease
had it not been terminated) all of which shall be immediately due and
payable by Tenant to Landlord; and/or
(b) Without terminating this Lease, enter upon and take possession of the
Premises, and expel or remove Tenant and any other person who may be
occupying said Premises, or any part thereof, by force if necessary,
without notice or the need to resort to legal process and without
being deemed guilty of trespass or becoming liable for any loss or
damage occasioned thereby. Landlord may make such alterations and
repairs as it deems advisable to relet the Premises, and relet the
Premises or any part thereof for such term or terms (which may extend
beyond the Term of this Lease) and at such rentals and upon such other
terms and conditions as Landlord in its sole discretion deems
advisable. Upon each such reletting all rentals received by Landlord
therefrom shall be applied: first, to any indebtedness other than rent
due hereunder from Tenant to Landlord; second, to pay any costs and
expenses of reletting, including brokers' and attorneys' fees and
costs of alterations and repairs; third, to rent due hereunder; and
fourth, the residue, if any, shall be held by Landlord and applied in
payment of future rent as it becomes due hereunder. No such reletting
shall relieve Tenant or any guarantors from their obligations
hereunder. If rentals received from such reletting during any month
are less than that to be paid during that month by Tenant hereunder,
Tenant shall immediately pay any such deficiency to Landlord. In no
event shall Tenant be entitled to any excess rent obtained by
reletting the Premises over and above the rent reserved herein.
No re-entry or taking possession of the Premises by Landlord shall be
construed as an election to terminate this Lease unless a written notice of such
termination is given by Landlord to Tenant. Notwithstanding any such reletting
or re-entry or taking possession, without termination, Landlord may at any time
thereafter terminate this Lease for any prior breach or default. Pursuit of any
of the foregoing remedies shall not preclude pursuit of any of the other
remedies herein provided or any other remedies provided by at law or in equity,
nor shall pursuit of any remedy herein provided constitute a forfeiture or
waiver of any rent due to Landlord hereunder or of any damages accruing to
Landlord. Notwithstanding anything herein to the contrary, Landlord shall have
no obligation to relet or attempt to relet the Premises or any portion thereof
following termination of this Lease, re-entry or repossession of the Premises.
Provided, however, in the event Landlord is ever held to have such a duty,
Tenant agrees that Landlord shall, in connection with such efforts, not be
required to do anything more than list the Premises for lease with a licensed
real estate broker of Landlord's choosing (which may be an affiliate of
Landlord) for a period of * (*) months. If no party acceptable to Landlord
executes a lease with Landlord on terms reasonably acceptable to Landlord within
this * (*) month period, Tenant agrees that Landlord shall conclusively have
satisfied any such duty to release or mitigate. In no event will Landlord have
any duty to lease the Premises before Landlord leases other vacant space which
it has in the Project or other buildings owned by Landlord nor shall Landlord
have any duty to lease to and Landlord will not be considered to be acting
unreasonably in refusing to lease to any party if: (i) the prospective lessee
has a financial condition which is unacceptable to Landlord or Landlord's
lenders; (ii) the prospective lessee requires any alterations which are
unacceptable to the Landlord or Landlord's lenders; (iii) the prospective lessee
requires tenant improvements to be paid by Landlord; or (iv) the prospective
lessee requires terms different from this Lease or which are otherwise
unacceptable to Landlord or Landlord's lender.
21.3.Lockout Provisions. Upon the occurrence of an uncured event of default
under the Lease, Landlord shall be entitled to change the locks at the
Premises after three (3) days prior written notice to Tenant. Tenant agrees
that entry may be gained for that purpose through use of a duplicate or
master key or any other means, that same may be conducted out of the
presence of Tenant if Landlord so elects, that no notice shall be required
to be posted at the time of such entry by the Landlord on any door to the
Premises (or elsewhere) disclosing the reason for such action or any other
information, and that Landlord shall not be obligated to provide a key to
the changed lock to Tenant unless Tenant shall have first: (a) brought
current all payments due to Landlord under this Lease; provided, however,
that if Landlord has theretofore formally and permanently repossessed the
Premises, or has terminated this Lease, then Landlord shall be under no
obligation to provide a key to the new lock(s) to Tenant regardless of
Tenant's payment of past-due rent or other past-due amounts, damages, or
any other payment or amounts of any nature or kind whatsoever; (b) fully
cured and remedied to Landlord's satisfaction all other defaults of Tenant
under this Lease (but if such defaults are not subject to cure, such as
early abandonment of the Premises, then Landlord shall not be obligated to
provide the new key to Tenant under any circumstances); and (c) given
Landlord security and assurances satisfactory to Landlord that Tenant
intends to and is able to meet and comply with its future obligations under
this Lease, both monetary and nonmonetary.
21.4.Landlord's Performance for Account of Tenant. If the Tenant shall continue
in default in the performance of any of the covenants or agreements herein
contained after the time limit for the curing thereof then Landlord may
perform the same for the account of Tenant. Any amount paid or expense or
liability (together with interest thereon at the Maximum Rate from the date
upon which any such expense shall have been incurred) incurred by Landlord
in the performance of any such matter for the account of Tenant shall be
deemed to be additional rent and the same (together with interest thereon
at the Maximum Rate from the date upon which any such expense shall have
been incurred) may, at the option of Landlord, be added to any rent then
due or thereafter falling due hereunder or shall be payable by Tenant to
Landlord on demand.
21.5.Application of Payments Received From Tenant. Landlord shall have the
right to apply any payments made by Tenant to the satisfaction of any debt
or obligation of Tenant to Landlord according to Landlord's sole discretion
and regardless of the instructions of Tenant as to application of any such
sum, whether such instructions be endorsed upon Tenant's check or
otherwise, unless otherwise agreed upon by both parties in writing. The
acceptance by Landlord of a check or checks drawn by a party other than
Tenant shall not affect Tenant's liability hereunder nor shall it be deemed
an approval of any assignment or sublease of this Lease by Tenant.
21.6.Waiver of Rights of Redemption. To the extent permitted by law, Tenant
waives any and all rights of redemption granted by or under any present or
future laws if Tenant is evicted or dispossessed for any cause, or if
Landlord obtains possession of the Premises due to Tenant's default
hereunder or otherwise.
21.7.No Waiver. No delay or omission in the exercise of any right or remedy of
Landlord on any default by Tenant shall impair such a right or remedy or be
construed as a waiver. The receipt and acceptance by Landlord of delinquent
rent shall not constitute a waiver of any other default; it shall
constitute only a waiver of timely payment for the particular rent payment
involved. No act or conduct of Landlord, including, without limitation, the
acceptance of the keys to the Premises, shall constitute an acceptance of
the surrender of the Premises by Tenant before the expiration of the term.
Only a notice from Landlord to Tenant shall constitute acceptance of the
surrender of the Premises and accomplish a termination of the Lease.
Landlord's consent to or approval of any act by Tenant requiring Landlord's
consent or approval shall not be deemed to waive or render unnecessary
Landlord's consent to or approval of any subsequent act by Tenant. Any
waiver by Landlord or any default must be in writing and shall not be a
waiver of any other default concerning the same or any other provision of
the Lease.
22. Landlord's Lien. Intentionally omitted.
23. Default by Landlord. Except in the event of emergency repairs required to
be made by the Landlord to the Premises, which will be commenced at the
earliest reasonable opportunity by Landlord after receipt of notice of the
need therefore, Landlord shall in no event be charged with default in any
of its obligations hereunder unless and until Landlord shall have failed to
perform such obligations within * (*) days (or such additional time as is
reasonably required to correct any such default) after written notice to
Landlord by Tenant, specifically describing such failure. All obligations
of Landlord hereunder shall be construed as covenants, not conditions; and,
except as may be otherwise expressly provided in this Lease, Tenant may not
terminate this Lease for breach of Landlord's obligations hereunder. All
obligations of Landlord under this Lease will be deemed binding upon
Landlord only during the period of its ownership of the Project and not
thereafter. The term "Landlord" in this Lease shall mean only the owner,
for the time being of the Project, and in the event of the transfer by such
owner of its interest in the Project, such owner shall thereupon be
released and discharged from all obligations of Landlord thereafter
accruing, but such obligations shall be binding during the Lease Term upon
each new owner for the duration of such owner's ownership. Any liability of
Landlord under this Lease shall be limited solely to its interest in the
Project, and in no event shall any personal liability be asserted against
Landlord in connection with this Lease nor shall any recourse be had to any
other property or assets of Landlord.
24. Application of Payments Received From Tenant. Landlord shall have the right
to apply any payments made by Tenant to the satisfaction of any debt or
obligation of Tenant to Landlord according to Landlord's sole discretion
and regardless of the instructions of Tenant as to application of any such
sum, whether such instructions be endorsed upon Tenant's check or
otherwise, unless otherwise agreed upon by both parties in writing. The
acceptance by Landlord of a check or checks drawn by a party other than
Tenant shall not affect Tenant's liability hereunder nor shall it be deemed
an approval of any assignment or sublease of this Lease by Tenant.
25. Notices. All notices required to be given hereunder shall be in writing,
and shall be served in person upon the party to be notified or upon its
agent, or shall be mailed by certified or registered mail or deposited with
a nationally recognized overnight carrier, postage prepaid, to the
appropriate address shown on the signature page of this Lease. Either party
shall have the right to change its address for notice by notifying the
other party of such change in accordance with this paragraph. Notice shall
be deemed given * (*) days after deposit in the U.S. Mail or sent as
otherwise provided in the manner provided herein. Either party shall have
the right to change its address for notice by notifying the other party of
such change in accordance with this Paragraph.
26. Sale of Project or Land by Landlord. In the event of any sale of the
Project or Land by Landlord, or any part thereof, Landlord shall be and is
hereby entirely freed and relieved of all liability under any and all of
its covenants and obligations contained in or derived from this Lease
arising out of any act, occurrence or omission occurring after the
consummation of such sale; and the purchaser, at such sale or any
subsequent sale of the Project or Land shall be deemed, without any further
agreement between the parties or their successors in interest or between
the parties and any such purchaser, to have assumed and agreed to carry out
any and all of the covenants and obligations of the Landlord under this
Lease. Furthermore, in the event of a sale or conveyance by Landlord of the
Project or Land, this Lease shall not be affected by any such sale, and
Tenant agrees to attorn to the purchaser thereof.
27. Surrender, Holding Over and Successors.
27.1.Surrender. Upon the expiration or earlier termination of this Lease,
whether by forfeiture, lapse of time, or otherwise, or upon the termination
of Tenant's right to possession of the Premises, Tenant will at once
surrender and deliver up the Premises, to Landlord in good and broom-clean
condition and repair, reasonable wear and tear and loss by fire or other
casualty excepted. All Tenant Additions will, following the expiration or
termination of this Lease, remain in the Premises as Landlord's property
unless Landlord directs Tenant to remove all or any portion of same in
writing at the time Landlord approves the plans and specifications relating
to such Tenant Additions, provided however, that Tenant must request
Landlord's determination, whether said improvements will remain in the
Premises or be required to be removed, at the time Tenant is requesting
approval of the plans and specifications, whereupon Tenant agrees that it
shall, at its expense, remove such Tenant Additions (or portion thereof
directed by Landlord). Provided Tenant is not in default, it will remove
its Trade Fixtures, inventory, and other personal property upon the
expiration of the Term. . Tenant shall repair any damage to the Premises
caused by the removal of such Tenant Additions, Trade Fixtures, or other
items. In no event will any fire sprinklers, fire suppression equipment,
HVAC System components, floor tiles, carpeting, ceiling tiles, plumbing
fixtures, or similar building system items or any equipment or fixtures
attached to the realty be considered "Trade Fixtures" or be removed unless
directed by Landlord to do so. Tenant agrees that following an Event of
Default, Landlord may, at its option, allow any party claiming to be a
lessor of Tenant or a holder of a security interest in such trade fixtures
or equipment to remove equipment, Trade Fixtures, and similar items leased
from such lessor. Landlord shall have no liability to Tenant therefor.
Landlord may condition its consent upon such lessor or a holder of a
security interest in such trade fixtures or equipment agreeing to repair
any damage to the Premises caused by such removal and providing adequate
financial assurances of its ability to pay for any such damages. Provided,
however, no such agreement by any such lessor, or Landlord's failure to
obtain such an agreement, shall relieve Tenant of its obligations hereunder
including without limitation, Tenant's obligation to repair said damage
even if the damage is caused by said lessor or its contractors or agents.
Tenant shall remove all Hazardous Materials. Any Trade Fixtures or Tenant
Additions not removed by Tenant as required herein shall be deemed
abandoned and may be stored, removed and disposed of by Landlord at
Tenant's expense, and Tenant waives all claims against Landlord for any
damages resulting from Landlord's retention or disposal of same. Moreover,
any period following the termination or expiration of this Lease during
which there is Hazardous Material, Tenant Alterations or Trade Fixtures
which are not removed as herein required shall be considered a holdover by
Tenant and, in addition to all other remedies available to Landlord
hereunder, shall obligate Tenant to the increased rental payments pursuant
to Section 27.2. Tenant shall be entitled to no payment or offset for the
value of any such property (even if sold by Landlord) and shall pay on
demand all costs incurred by Landlord in connection with such removal or
disposal. No retention, disposal or sale of such items shall limit remedies
otherwise available to Landlord hereunder for a breach by Tenant. All
obligations of Tenant hereunder not full performed as of the termination or
expiration of the Lease shall survive such termination or expiration.
27.2.Holding Over. If Tenant holds over or occupies the Premises beyond the
Term of this Lease (it being agreed there shall be no such holding over or
occupancy without Landlord's written consent), Tenant shall pay Landlord
for each day of such holding over a sum equal to * the daily rent
applicable hereunder at the expiration of the Term (including Operating
Expenses), prorated for the number of days of such holding over. In such
event, Tenant shall occupy the Premises as a Tenant at sufferance, and all
of the terms and provisions of this Lease shall be applicable, with the
exception of the rent applicable during such holding over period, which
shall be increased as aforesaid. Tenant agrees that Landlord may institute
a forcible detainer or similar action against Tenant or any other party in
possession of the Premises without serving any demand for possession,
demand to vacate, notice of termination or similar demand or notice upon
Tenant or such party in possession.
27.3.Successors. All rights and liabilities herein given or imposed upon the
respective parties hereto shall bind and inure to the several respective
heirs, successors, administrators, executors and assigns of the parties and
if Tenant is more than one person, they shall be bound jointly and
severally by this Lease. No rights, however, shall inure to the benefit of
any assignee of Tenant unless the assignment is approved by Landlord as
required herein.
28. Brokers or Finders. Tenant represents and warrants to Landlord, that it has
engaged no broker or finder other than the Broker listed in Section 1 of
this Lease and that no claims for brokerage commissions or finders' fees
will arise in connection with the execution of this Lease and agrees to
indemnify, defend and hold Landlord harmless from any liability or expense
(including attorney's fees) arising from any such claim. Landlord agrees to
pay Broker a commission upon Tenant accepting occupancy and commencing
payment of Base Rent hereunder as provided in a separate agreement between
Landlord and said Broker.
29. Environmental Issues.
29.1.Tenants Compliance with Environmental Laws. Tenant shall not cause or
permit any Hazardous Material to be brought upon, kept or used in or about
the Premises by Tenant, its agents, employees, contractors or invitees
without the prior written consent of Landlord, which Landlord shall not
unreasonably withhold provided Tenant demonstrates to Landlord's
satisfaction that such Hazardous Material is necessary or useful to
Tenant's business. All Hazardous Materials will be used, kept and stored in
a manner that complies with all laws regulating any such Hazardous Material
so brought upon or used or kept in or about the Premises.
29.2.Indemnification. In addition to, and without limitation on the general
indemnity obligations of Tenant under this Lease, Tenant specifically
agrees that it shall indemnify, defend and hold Landlord harmless from any
and all claims, judgments, damages, penalties, fines, costs, liabilities or
losses (including, without limitation, diminution in value of the Premises
or the Project, damages for the loss or restriction on use of rentable or
usable space or of any amenity of the Premises, and sums paid in settlement
of claims, attorneys' fees, consultant fees and expert fees) which arise
during or after the Lease Term as a result of any breach by Tenant of its
obligations under this Paragraph or any contamination of the Premises
resulting from the presence of Hazardous Materials on or about the Premises
caused or permitted by Tenant. This indemnification of Landlord by Tenant
includes, without limitation, costs incurred in connection with any
investigation of site conditions or any clean-up, remedial, removal or
restoration work required by any federal, state or local governmental
agency or political subdivision because of Hazardous Material present in
the soil or ground water on or under the Premises. Without limiting the
foregoing, if the presence of any Hazardous Material on the Premises caused
or permitted by Tenant results in any contamination of the Premises, Tenant
shall promptly take all actions at its sole expense as are necessary to
return the Premises to the condition existing prior to the introduction of
any such Hazardous Material to the Premises, provided that Landlord's
approval of such actions shall first be obtained. Tenant further agrees to
defend Landlord, its agents, employees, and assigns in any administrative
or judicial proceeding commenced by private individuals or governmental
entities seeking recovery of damages for personal injury or property
damage, or recovery of civil penalties or fines arising out of, connected
with, or relating to any breach by Tenant of its obligations under this
Paragraph or any contamination of the Premises resulting from the presence
of Hazardous Materials on or about the Premises caused or permitted by
Tenant. The foregoing indemnity shall survive the expiration or earlier
termination of this Lease.
29.3.Hazardous Material. As used herein, the term "Hazardous Material" means
any pollutant, toxic substance, hazardous waste, hazardous material,
hazardous substance, oil hydrocarbon, asbestos or similar item as defined
in or pursuant to the Resource Conservation and Recovery Act, as amended,
the Comprehensive Environmental Response, Compensation, and Liability Act,
as amended, the Federal Clean Water Act, as amended, the Safe Drinking
Water Act, as amended, the Federal Water Pollution Control Act, as amended,
or any other federal, state or local environmental or heath and safety
related law, regulation, ordinance, rule, or bylaw, whether existing as of
the date hereof, previously enforced or subsequently enacted (collectively
the "Environmental Laws").
29.4.Notice of Certain Events. Tenant shall immediately advise Landlord in
writing of (a) any governmental or regulatory actions instituted or
threatened under any Environmental Law affecting the Tenant or the
Premises, (b) all claims made or threatened by any third party against
Tenant or the Premises relating to damage, contribution, cost recovery,
compensation, loss or injury resulting from any Hazardous Materials, (c)
the discovery of any occurrence or condition on any real property adjoining
or in the vicinity of the Premises that could cause the Premises or the
Project or Land to be classified in a manner which may support a claim
under any Environmental Law, and (d) the discovery of any occurrence or
condition on the Premises, the Project or Land or any real property
adjoining or in the vicinity of the Premises, the Project or Land which
could subject Tenant, the Premises, the Project or Land to any restrictions
in ownership, occupancy, transferability or use of the Premises, the
Project or the Land under any Environmental Law. Landlord may elect to join
and participate in any settlements, remedial actions, legal proceedings or
other actions initiated in connection with any claims under any
Environmental Law caused or alleged to have been caused by Tenant, it
agents, employees, contractors or invitees and to have its reasonable
attorney's fees paid by Tenant. At its sole cost and expense, Tenant agrees
when applicable or upon request of Landlord to promptly and completely cure
and remedy every violation of an Environmental Law caused by Tenant, its
agents, employees, contractors or invitees.
29.5.Environmental Review. In the event reasonable evidence exists of the
occurrence or existence of the violation of any Environmental Law or the
presence of any Hazardous Material on the Premises, the Project or the
Land, caused by Tenant, its agents, employees, contractors, or invitees,
Landlord (by its officers, employees and agents) at any time and from time
to time may contract for the services of persons (the "Site Reviewers") to
perform environmental site assessments ("Site Assessments") on the
Premises, the Project, Land or neighboring properties for the purpose of
determining whether there exists on the Premises, the Project, Land or
neighboring properties any environmental condition which could reasonably
be expected to result in any liability, cost or expense to Landlord. The
Site Reviewers are hereby authorized to enter upon the Premises for
purposes of conducting Site Assessments. The Site Reviewers are further
authorized to perform both above and below the ground testing for
environmental damage or the presence of Hazardous Materials and such other
tests on the Premises, the Project, Land or neighboring properties as may
be necessary to conduct the Site Assessments in the reasonable opinion of
the Site Reviewers. Tenant agrees to supply to the Site Reviewers such
historical and operational information regarding the Premises as may be
reasonably requested by the Site Reviewers to facilitate the Site
Assessments and will make available for meetings with the Site Reviewers
appropriate personnel having knowledge of such matters. The results of Site
Assessments shall be furnished to Tenant upon request. The cost of
performing such Site Assessments shall be paid by Tenant.
30. Miscellaneous.
30.1.Partial Invalidity. If any term, covenant, condition or provision of this
Lease is held by a court of competent jurisdiction to be invalid, void or
unenforceable, the remainder of the provisions hereof shall remain in full
force and effect and shall in no way be affected, impaired or invalidated
thereby.
30.2.Captions. The various headings and numbers herein and the grouping of the
provisions of this Lease into Paragraphs are for the purpose of convenience
only and shall not be considered a part hereof unless expressly stated to
the contrary.
30.3.Gender; Number. Words of any gender used in this Lease shall be held and
construed to include any other gender, and words in the singular number
shall be held to include the plural, and vice versa, unless the context
otherwise requires.
30.4.Applicable Law. This Lease shall be governed by the laws of the State of
New Mexico.
30.5.Corporation as Tenant. If a corporation executes this Lease as Tenant, it
shall promptly furnish Landlord with certified corporate resolutions, a
secretary's certificate or other evidence reasonably acceptable to Landlord
attesting to the authority of the officers executing this Lease on behalf
of such corporation.
30.6.Time. Time is of the essence of this Lease.
30.7.Joint and Several Liability. If Tenant is a partnership or other business
organization, the members of which are subject to personal liability, the
liability of each such member shall be deemed to be joint and several.
30.8.Accord and Satisfaction. Landlord is entitled to accept, receive and cash
or deposit any payment made by Tenant for any reason or purpose or in any
amount whatsoever, and apply the same at Landlord's option to any
obligation of Tenant and the same shall not constitute payment of any
amount owed except that to which Landlord has applied the same. No
endorsement or statement on any check or letter of Tenant shall be deemed
an accord and satisfaction or otherwise recognized for any purpose
whatsoever. The acceptance of any such check or payment shall be without
prejudice to Landlord's right to recover any and all amounts owed by Tenant
hereunder and the Landlord's right to pursue any other available remedy.
30.9.Entire Agreement. There are no representations, covenants, warranties,
promises, agreements, conditions or undertaking, oral or written, between
Landlord and Tenant other than herein set forth. Except as otherwise
provided herein, no subsequent alteration, amendment, change or addition to
this Lease shall be binding upon Landlord or Tenant unless in writing and
signed by them. The normal rule of construction to the effect that any
ambiguities are to be resolved against the drafting party shall not be
employed in the interpretation of the Lease or any exhibits or addendums
hereto.
30.10No Partnership. Landlord does not, in any way or for any purpose, become
a partner, employer, principal, master, agent or joint venturer of or with
Tenant.
30.11. Force Majeure. If either party hereto shall be delayed or hindered in or
prevented from the performance of any act required hereunder by reason of
acts of God, unavoidable casualties, the elements, inclement weather
preventing work, strikes, lockouts, labor troubles, inability to procure
material, failure of power, restrictive governmental laws or regulations,
riots, insurrection, war or other reason of a like nature, not the fault of
the party delayed in performing work or doing acts required under this
Lease, the period for the performance of any such act shall be extended for
a period equivalent to the period of such delay. Tenant shall not be
excused from any obligations for payment of rent, percentage rent,
additional rent or any other payments required by the terms of this Lease
when same are due, and all such amounts shall be paid when due, unless
otherwise expressly set forth herein.
30.12. Attorney's Fees and Waiver of Jury Trial. In the event of any litigation
regarding this Lease, the losing party shall pay to the prevailing party
reasonable attorney's fees. Without limitation on the foregoing, Tenant
agrees that should Landlord ever file a forcible detainer action or a
forcible entry and detainer action, Landlord shall be entitled to its
reasonable attorney's fees and costs in such action, and Landlord shall not
be required to give Tenant written notice to vacate or any other notice in
order to recover such attorney's fees and costs. Landlord and Tenant
acknowledge the delay, expense and uncertainty associated with a jury trial
involving a complex commercial lease of this nature, and in recognition of
these inherent problems hereby waive their rights to a jury trial and agree
that any litigation regarding this Lease will be tried without a jury.
30.13. Limitation of Liability. To the extent Section 56-7-1 N.M.S.A. 1978 may
be applicable to this Lease, any indemnity agreement contained herein shall
not extend to liability, claims, damages, losses or expenses, including
attorney's fees, arising out of:
(a) the preparation or approval of maps, drawings, opinions, reports,
surveys, change orders, designs or specifications by the indemnitee;
or
(b) the giving or the failure to give directions or instructions by the
indemnitee, or the agents or employees of the indemnitee, where such
giving or failure to give directions or instructions is the primary
cause of bodily injury to persons or damage to property.
30.14. Exhibits. The following Exhibits are attached to this Lease and are
incorporated herein by reference:
Exhibit A = Premises/Site Plan
Exhibit B = Additional Parking Area
Exhibit C = Sign Criteria
Exhibit D = Certification of Tenant's Insurance
Exhibit E1 = Overall Floor Plan of the Building
Exhibit E2 = Clarifications to the Approved Building Plan Set
Exhibit E3 = List of the Approved Building Plan Set
31. Construction of Improvements. Landlord agrees to construct certain
improvements to the Premises as herein provided. Attached to this Lease is
the Overall Floor Plan of the Building (Exhibit "E1"), the Clarifications
to the Approved Building Plan Set (Exhibit "E2") and List of the Approved
Building Plan Set (Exhibit "E3") which consists of Sheet A1.1 prepared by
Alvidrez and Associates dated April 13, 2000 and sheets MP-1 and E-1
through E-3 dated April 10, 2000 and demolition plans MP-1 and E-1 dated
April 1988 (reflecting demolition only) prepared by Mustang Mechanical &
Electrical and have been approved by Tenant, all of which are herein
collectively referred to as the "Approved Landlord's Work Plans." As soon
as practical after execution of this Lease, the Landlord, at its cost and
expense, agrees to undertake construction of improvements in and to the
Premises in accordance with the Approved Landlord's Work Plans attached
hereto (the "Landlord's Work") and to complete the same in a good and
workmanlike manner in compliance with all applicable laws in place at the
time of issuance of the building permit and in substantial accordance with
such Approved Landlord's Work Plans, free of any mechanic's and
materialman's liens relating to Landlord's Work which could impair Tenant's
right to possession. In no event will Landlord's Work include, and Tenant
will be responsible for: (i) any items designed on the Approved Landlord
Work Plans as "Tenant's Work" or "to be provided by Tenant" or words to
that effect or (ii) without limitation, any of the following: security
system, fire extinguishers, generators, computers, fixtures, furnishings,
furniture, vending machines, telephone systems and related wiring, computer
cabling and wiring.
31.1.Tenant's Work. Following Landlord's Substantial Completion of the
Landlord's Work, Tenant, at its cost and expense, agrees to undertake
construction of improvements in and to the Leased Premises as set forth in
the Approved Tenant Plans (as defined below) (herein the "Tenant's Work")
to complete the same in a good and workmanlike manner in compliance with
Approved Tenant Plans and all applicable regulations of Federal, State and
local governmental bodies. Prior to commencement of the Tenant's Work, the
Tenant will deliver to the Landlord plans and specifications for the
Tenant's Work. The Landlord will have the right to promptly approve or
disapprove the same by written notice to the Tenant, specifying the
corrective action required in the case of any disapproval. Landlord will
not unreasonably withhold, condition or delay its consent to such plans
provided they do not create a Design Problem. If Landlord disapproves of
any such items, Tenant will revise the plans and specifications and
resubmit to Landlord and this process will be repeated until the plans and
specifications for the Tenant's Work are approved by Landlord and Tenant at
which point such plans will be referred to as the "Approved Tenant Plans."
As used herein a "Design Problem" shall mean: (i) an adverse effect on the
structural integrity of the Building; (ii) possible damage to the building
systems; and (iii) noncompliance with applicable codes, rules, laws and
regulations. No approval by Landlord of the Plans and specifications for
Tenant's Work shall relieve Tenant of its obligations hereunder or be
deemed a warranty by Landlord with respect thereto.
31.2.Completion of Landlord's Work. Landlord agrees that the Landlord's Work
will, subject to Tenant Delays as described below and Force Majeure Events
as described in Section 30.11, be substantially completed in accordance
with Approved Landlord's Work Plans on or before June 23, 2000 ("Target
Completion Date"). As used herein, "Substantially Complete" and
"Substantial Completion" shall mean completion of Landlord's Work to the
point where in the reasonable opinion of Landlord's architect, the work is
complete in accordance with the Approved Landlord's Work Plans to the point
where Tenant may commence Tenant's Work except for punchlist items which do
not materially interfere with or prevent Tenant's Work, which punchlist
items shall be promptly and diligently completed by Landlord. Tenant's
contractor (and its various subcontractors) may enter upon the Premises
prior to the June 23, 2000 provided that they work in harmony with the
Landlord's contractor and do not cause the Landlord's contractor any delays
or interfere with necessary inspections. During any such entry prior to
June 23, 2000, Tenant shall maintain insurance in amounts not less than and
of the type required of Tenant as specified in section 14 of this Lease,
such insurance shall name Landlord as an additional insured. . Tenant's
acceptance of occupancy from Landlord shall constitute acknowledgment by
Tenant that the Premises are then in the condition called for in the Lease
and that Landlord has satisfactorily completed Landlord's work hereunder.
As used herein, "Tenant Delay" shall mean any delay in Landlord's Work
caused by Tenant or its contractors, agents or employees, including without
limitation: (i) any failure to respond to items submitted for Tenant's approval
within the time limit specified by Landlord or, if no time limits are specified,
within * (*) business days; (ii) any changes to Landlord's Work caused by
Tenant's design of the Tenant's Work; or (iii) any failure of Tenant to pay any
amounts due hereunder when due or to otherwise perform as herein required. The
Target Completion Date and Outside Completion Date will be extended one (1) day
for each day or partial day of Tenant Delay or Force Majeure Event.
31.3.Failure to Complete. Landlord shall not be liable in damages and Tenant
may not terminate this Lease or pursue any remedies against Landlord if
Landlord fails to achieve Substantial Completion on or before the Target
Completion Date. If, however, Landlord fails to achieve Substantial
Completion of Landlord's Work for any reason other than Tenant Delay or
delay caused by Force Majeure Event on or before * (*) days following the
issuance of a building permit for the Premises (herein the "Outside
Completion Date"), then Tenant may, as its sole and exclusive remedy for
such delay, delay the Rent Commencement Date for * (*) day for each day
after the Outside Completion Date that Substantial Completion is not
achieved. If the failure to complete is caused by Tenant Delay, Base Rent
and other sums shall commence not later than June 15, 2000, regardless of
whether the Landlord's Work is Substantially Complete.
31.4.Substitutions and Change Orders. Tenant agrees that when the Approved
Landlord's Work Plans designate a particular brand of materials or
equipment, Landlord may substitute a different brand of substantially equal
quality (as determined by Landlord's architect) as availability may
dictate. Tenant will have no right to require changes to the Approved
Landlord's Work Plans without Landlord's consent, which consent Landlord
may withhold pending (i) Tenant's payment for any costs associated
therewith and (ii) Tenant's agreement for an extension of time to complete
Landlord's Work. In no event will Landlord be obligated to reduce the Base
Rent because of any savings achieved by a change.
32. Renewal Option.
(a) Provided that as of the time of the giving of the Extension Notice and
on the Commencement Date of the Renewal Term, no event of default
exists then Tenant shall have the right to extend the Lease Term for *
(*) additional term of * (*) years (hereinafter"Renewal Term"),
commencing on the day following the expiration of the Initial Term as
applicable (hereinafter referred to as the "Commencement Date of the
Renewal Term"). Tenant shall give Landlord notice (hereinafter called
the "Extension Notice") of its election to extend the Term at least *
(*) months prior to the scheduled expiration date of the applicable
Term.
(b) Base Rent during the Renewal Term will be the greater of (i) * (*) of
the then Market Rental Rate for comparable space, improvements and
parking as determined pursuant to Section 32(d) or (ii) $* per square
foot.
(c) Except for the Base Rent as determined above, Tenant's occupancy of
the Premises during the Renewal Term shall be on the same terms and
conditions as are in effect immediately prior to the expiration of the
expiring Term, provided, however, Tenant shall have no further right
to any allowances, credits or abatements relating to inducements
regarding the Initial Term and the Right of First Refusal shall not
apply. If Tenant does not give the Extension Notice within the period
set forth in Section (a) above, Tenant's right to extend the Lease
Term shall automatically terminate. Time is of the essence as to the
giving of the Extension Notice. Landlord shall have no obligation to
refurbish or otherwise improve the Premises for the Renewal Term. The
Premises shall be tendered on the Commencement Date of the Renewal
Term in "AS IS" condition. If the Lease is extended for the Renewal
Term, then Landlord shall prepare and Tenant shall execute an
amendment to the Lease confirming the extension of the Lease Term and
the other provisions applicable thereto (the "Amendments"). If Tenant
exercises its right to extend the term of the Lease for the Renewal
Term pursuant to this Addendum, the term "Lease Term" as used in the
Lease shall be construed to include, the Renewal Term. Tenant's
Extension Notice is irrevocable once given.
(d) Calculation of Market Rental Rate by Agreement. The "Market Rental
Rate" as herein so called shall be determined (i) by mutual written
agreement reached between Landlord and Tenant on or before * (*) days
after Tenant shall have provided the Extension Notice, or (ii) if
Landlord or Tenant cannot so mutually agree on or before the
expiration of such *-day period, by means of the appraisal procedure
set forth below.
(i) Appraiser. If Landlord and Tenant cannot agree on the Market
Rental Rate within such *-day period, Landlord and Tenant shall,
within * (*) days after the expiration of the above-referenced
*-day period, attempt to agree in writing on an appraiser (who
shall in all events be a member of the American Institute of Real
Estate Appraisers with at least * (*) years experience appraising
properties of the same type as the Premises in the area where the
Premises is located (the "Appraiser Qualifications"), such
appraiser, an "MAI Lease Appraiser"). If Landlord and Tenant
agree on an appraiser within the required period, the Market
Rental Rate shall be determined by such single appraiser (which
appraiser shall render its appraisal within * (*) days after its
appointment).
(ii) Appointment of Appraisers. In the event that Landlord and Tenant
cannot so mutually agree on an appraiser within the required time
period, the Market Value shall be determined by two appraisers,
one appointed by Tenant and one appointed by Landlord, each of
which shall satisfy the Appraiser Qualifications and each of
which shall be appointed within * (*) days after the expiration
of the time period set forth in Section 34.2 above. In the event
that Landlord or Tenant fails to so appoint an appraiser within
such time period, the other party hereto shall, upon prior
written notice to the other party, appoint the second appraiser
on behalf of such party.
(iii)Delivery of Appraisals. The appraisals of these two appraisers
must be completed and submitted to Landlord and Tenant within *
(*) days after their appointment.
(iv) Averaging of Appraisals - Selection of Third Appraiser. The
appraisals of these two appraisers shall be averaged to determine
the Market Value, unless the higher of the two appraisals exceeds
the lesser by * (*) or more, in which case the first two
appraisers shall appoint a third appraiser within * (*) days
after the submission of the first two appraisals. If the first
two appraisers are unable to agree within such period upon the
third appraiser, they shall give immediate written notice to
Landlord and Tenant of such failure to agree, and, if Landlord
and Tenant fail to agree upon the selection of such third
appraiser within * (*) days after the two appraisers give notice
as aforesaid, then, within * (*) days thereafter, either Landlord
or Tenant, upon notice to the other, may request such appointment
by the American Arbitration Association (or any successor
organization thereto), or, in the event of the absence, refusal,
failure or inability to act of such organization, may apply for a
court appointment of such appraiser (which third appraiser shall
in all events satisfy the Appraiser Qualifications).
(v) Delivery of Third Appraisal. The third appraiser shall have the
right to participate in all meetings of the first two appraisers
following its appointment and shall receive copies of all
reports, memoranda and other materials exchanged between the
first two appraisers. The third appraiser shall conduct such
hearings and investigations as it may deem appropriate and shall
render its appraisal within * (*) days after its appointment.
Upon submission of the appraisal report of the third appraiser
(which appraisal report shall be submitted to Landlord and
Tenant), the two appraisals closest to each other shall be
averaged and such average shall be the Market Value.
(vi) Cost and Scope of Appraisals. Tenant and Landlord in equal shares
shall bear all costs incurred by any appraiser whether appointed
by Landlord or Tenant. All appraisal reports shall be in writing.
In rendering their respective appraisals, the appraisers shall
not add to, subtract from or otherwise modify the provisions of
this Section.
(vii)Appraisals Conclusive. The determination of the appraisers, as
aforesaid, shall be conclusive and binding upon both Landlord and
Tenant.
33. Right of First Refusal. Provided no Event of Default then exists, Tenant
shall have a right of first refusal to lease the space within the Building
adjacent to the Premises at the same lease price offered by any bona fide
third party offer received by Landlord during the Initial Term of the
Lease, which offer Landlord desires to accept. If Tenant desires to
exercise such right, it must do so by written notice to Landlord ("Election
Notice") within * (*) business days after Landlord's notice to Tenant
setting forth the exact terms of the third party offer ("Offer Notice").
Tenant will within * (*) days of delivery from Landlord execute an
amendment to this Lease to include the additional space which was the
subject of such third party offer in the "Premises", to adjust Tenant's
Share and to make such other modifications to this Lease as Landlord deems
reasonably necessary to be effective upon the later of (i) the date of the
amendment or (ii) substantial completion of any finish work as required by
such third party offer if relevant to Tenant's business.
This Right of First Refusal shall not apply to space in the Building which
does not immediately abut the Premises. Moreover, this Right of First Refusal
does not apply to space in any new building constructed adjacent to the Premises
or in the existing building adjacent to the Premises. If Tenant does not so
exercise its option to lease the adjacent space, this Right of First Refusal
shall not survive a lease to said third party offeree. No broker's commission
shall be owed in connection with the lease by Tenant of any space in the
Building pursuant to the Right of First Refusal.
This right is personal to Tenant and may not be assigned separate from this
Lease.
If Tenant provides the Election Notice as herein provided and fails to
execute the Amendment, then: (i) Tenant will be in breach hereunder; (ii) this
Right of First Refusal shall expire, and not apply to any future leases; and
(iii) the ability to terminate the Lease as provided in Section 34 shall, if not
already terminated, expire. If Tenant elects not to exercise this Right of First
Refusal, Tenant shall provide such reasonable assurances of same as Landlord or
said third party offeree may require.
34. Early Termination.
Provided Tenant is not in default hereunder, it shall have the option of
terminating this Lease ("The Option") during the primary term. The Option shall
be effective after the end of the * (*) month following the Rent Commencement
Date. To exercise The Option, Tenant must provide written notice to Landlord,
the ("Termination Notice") anytime after the * (*) month following the Rent
Commencement Date. The Termination Notice shall specify a date which shall be no
less than * (*) months following the date of the Termination Notice the
("Termination Date"). As consideration for The Option, Tenant shall pay a
termination fee to Landlord the ("Termination Fee"), which fee must accompany
the Termination Notice, in the applicable amount set forth on Exhibit "E"
attached hereto. The Termination Fee shall be determined by calculating the
number of complete months elapsed in the Lease Term between the Rent
Commencement Date and the Termination Date and using the applicable Termination
Fee shown on Exhibit "E".
All payments due under this Lease for the remaining * (*) months after the
Termination Notice will be paid when due and all provisions regarding the
surrender of the Premises shall apply. Once exercised, The Option is
irrevocable.
35. Exclusivity.
Provided (i) Tenant is operating in the Premises for the Use provided in
Section 1, (ii) is not in default hereunder and (iii) Landlord is the owner of
the buildings currently municipally numbered as 1630 and 1680 Hickory Loop (if
any), Landlord agrees not to lease space in such buildings for use as a customer
service/call center, without the prior written consent of Tenant.
36. Landlord's Warranties.
36.1 Compliance with Laws. Landlord warrants to Tenant that the Premises
(excluding, any improvements or alterations performed by Tenant) in the
state existing on the date that this Lease commences, but without regard to
the use for which Tenant will occupy the Premises, does not violate any
covenants or restrictions of record, or any applicable building code,
regulation or ordinance in effect on the date upon which Lease commences.
In the event that it is determined that this warranty has been violated,
then it shall be the obligation of Landlord, after written notice from
Tenant, to promptly, at Landlord's sole cost and expense, rectify any such
violation. In the event Tenant does not give to Landlord written notice of
the violation of this warranty within one year from the date upon which
this Lease commences, the correction of same shall no longer be the
obligation of Landlord. Landlord shall comply with and shall cause the
Building throughout the Term of this Lease, to be in compliance with all
applicable Laws (as herinafter defined). Landlord shall be solely
responsible for all changes to the Project (excluding the interior of the
Premises) required to comply with all Laws, except for changes required to
comply with Laws which are due solely to Tenant's occupancy, use or manner
of use of the Project. As used herein, "Laws" shall mean all federal,
state, county and local laws, statutes, codes, ordinances, rules,
regulations, decrees, orders and other such requirements now or hereafter
imposed, including, but not limited to, the Americans with Disabilities Act
and any and all Environmental Laws.
36.2 No Latent Defects Landlord warrants to Tenant that there are no latent
defects in the Premises. If such latent defects are discovered by Tenant,
Tenant shall provide immediate written notice to Landlord of same and shall
allow Landlord a period of * (*) days to correct such latent defects or
initiate actions to correct such latent defects if the same cannot be
reasonably completed within * (*) days. In the event Tenant does not give
Landlord written notice of latents defects within * (*) days from the date
upon which this Lease commences, Landlord shall no longer have the
obligation to correct the same.
36.3 Hazardous Materials. Landlord to the best of Landlord's knowledge and after
reasonable inquiry, hereby represents to Tenant that, as of the date of
this Lease, no Hazardous Materials are located in, on, under or about the
Premises and that the Premises is not currently and has not been the
subject of any investigation or remedial action imposed by federal state or
local regulatory authorities with jurisdiction concerning Hazardous
Materials.
IN WITNESS WHEREOF, Landlord and Tenant have signed this Lease as of the
day and year first above written.
LANDLORD:
Mesilla Valley Business Park, LLC
BY: Mesita Investors, L.L.C.
ITS: General Partner
BY: Meyer Marcus
ITS: Manager
ADDRESS: 6500 Montana Avenue
El Paso, Texas 79925
TENANT:
Frontier Airlines, Inc., A Colorado
Corporation
BY: _________________________
ITS: _________________________
ADDRESS: 12015 East 46th Avenue
Denver, Colorado 80239
Phone Number: ___________________
Fax Number: ___________________
<PAGE>
RULES AND REGULATIONS FOR MESILLA VALLEY BUSINESS PARK
(a) Tenant shall not place or maintain any merchandise, vending machines or
other articles in any vestibule or entry of the Premises or outside the
Premises;
(b) Tenant shall store garbage, trash, rubbish and other refuse in rat-proof
and insect-proof containers inside the Premises or at such other location
as directed by Landlord. Tenant shall remove the same frequently and
regularly, subject to the direction of Landlord by such means and methods
and at such times and intervals as are designated by Landlord, all at
Tenant's cost;
(c) Tenant shall not permit any audible sound system or objectionable visible
advertising medium outside the Premises;
(d) Tenant shall keep all mechanical equipment free of vibration and noise, and
in good working order and condition;
(e) Tenant shall not commit or permit waste or a nuisance on the Premises,
including, without limitation, any noxious, toxic or corrosive emissions
from the Premises or the placing of any upon the Premises, and shall not
permit or cause odors to emanate or be dispelled from the Premises;
(f) Tenant shall not solicit business in the Common Area nor distribute
advertising matter in or upon the Common Area;
(g) Tenant shall not permit the loading or unloading or the parking or standing
of delivery vehicles outside any area designated therefor, nor permit any
use of vehicles which will interfere with the use of the Common Area in the
Project nor permit its employees to park anywhere in the Project other than
those areas designated from time to time by Landlord as "Additional Parking
Area";
(h) Tenant shall not place a load on any floor in the Project which exceeds the
floor load per square foot which such floor was designed to carry;
(i) Subject to the rights granted to Tenant in the Lease, Landlord shall have
the exclusive right to use all or part of the roof, side and rear walls of
the Premises for any purpose, including but not limited to erecting signs
or other structures on or over all or any part of the same, erecting
scaffolds and other aids to the construction and installation of the same,
and installing, maintaining, using, repairing, and replacing pipes, ducts,
conduits and wires leading through, to or from the Premises and serving
other parts of the Project in locations which do not materially interfere
with Tenant's use of the Premises;
(j) Subject to the rights to Tenant in the Lease, Tenant shall have no right
whatsoever to the exterior walls or the roof of the Premises or any portion
of the Project outside the Premises, except as otherwise provided in this
Lease; and
(k) Tenant shall make no use of the Premises or the Project which would cause
the premiums on the insurance carried by Landlord, if any, to be increased
or which would cause such insurance to be canceled.
