7050 South 2000 East (Salt Lake City, UT) Lease Agreement – Robert D. Kaufman, Dale E. Kaufman and Network Computer Inc.
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WILLOWCREEK MEDICAL BUILDING
LEASE AGREEMENT
Suite 300
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Tenant Name: NETWORK COMPUTER INC.
Date: APRIL 1, 1999
TABLE OF CONTENTS
I. PREMISES
II. TERM COMMENCEMENT
2.1 Term of Lease
2.2 Commencement of Term
III. MONTHLY RENT
3.1 Base Monthly Rent
IV. SECURITY DEPOSIT
V. LATE CHARGES
VI. INSURANCE
6.1 Tenant's Insurance Coverage
6.2 Insurance Policies
6.3 Payment of Increased Premiums
VII. UTILITIES AND JANITORIAL SERVICE
7.1 Utilities and Services
7.2 Electricity and Natural Gas Use
7.3 Meters
7.4 Interruption of Service
7.5 Additional Power
VIII. USE OF PREMISES
8.1 Use
8.2 Suitability
8.3 Prohibited Use
IX. FIXTURES AND ALTERATIONS
9.1 Alterations
9.2 Signs, Posters, Window Coverings on Premises
9.3 Conditions and Limitations
9.4 Contractors and Materialmen
9.5 Additional HVAC
X. MAINTENANCE AND REPAIRS
10.1 Landlord's Obligations
10.2 Tenant's Obligations
XI. DAMAGE OR DESTRUCTION
11.1 Partial Damage - Insured
11.2 Partial Damage - Uninsured
11.3 Total Destruction
11.4 Landlord's Obligations
11.5 Tenant's Claims Against Landlord
XIII. CONDEMNATION
XIII. ASSIGNMENT AND SUBLETTING
13.1 Landlord's Consent Required
13.2 Reasonable Consent
13.3 No Release of Tenant
13.4 Increased Expenses
13.5 Assignment and Subletting
XIV. SUBORDINATION, QUIET ENJOYMENT AND ATTORNMENT
14.1 Subordination
14.2 Subordination Agreement
14.3 Quiet Enjoyment
14.4 Attornment
XV. DEFAULT AND REMEDIES
15.1 Default
15.2 Nonexclusive Remedies
15.3 Additional Remedies, Costs and Expenses
15.4 Default by Landlord
XVI. ENTRY BY LANDLORD
XVII. INDEMNITY
17.1 Indemnity
17.2 Attorney's Fees and Costs
XVIII. ESTOPPEL CERTIFICATES
18.1 Requirements
18.2 Failure to Deliver
XIX. PARKING
XX. MISCELLANEOUS
20.1 Transfer of Landlord's Interest
20.2 Captions
20.3 Entire Agreement
20.4 Severability
20.5 Cost of Suit
20.6 Times and Remedies
20.7 Binding Effect, Successors and Choice of Law
20.8 Waiver
20.9 Surrender of Premises
20.10 Holding Over
20.11 Signs
20.12 Rules and Regulations
20.13 Notice
20.14 No Partnership
20.15 Force Majeure
20.16 Tenant Authorization
20.17 Special Provisions
EXHIBIT A: DESCRIPTION OF PREMISES
EXHIBIT B: DESCRIPTION OF BUILDING
RULES AND REGULATIONS
LEASE AGREEMENT
THIS LEASE (the 'Lease') is made and entered into this ____day of
_________ 1999, by and between ROBERT D. KAUFMAN & DALE E. KAUFMAN, as
individuals, (hereinafter referred to as 'Landlord') and NETWORK COMPUTER
INC. (hereinafter referred to as 'Tenant').
W I T N E S S E T H:
In consideration of the rents, covenants and agreements hereinafter
set forth, Landlord and Tenant mutually agree as follows:
ARTICLE I: PREMISES:
Landlord hereby leases and demises to Tenant and Tenant hereby leases
from Landlord those certain premises described on Exhibit 'A', attached
hereto and incorporated herein by reference (hereinafter referred to as the
'Premises') and located in that certain office building complex (hereinafter
referred to as the 'Building') situated in Salt Lake City, Salt Lake County,
Utah, commonly known as Willowcreek Medical Building on the property more
particularly described on Exhibit 'B,' attached hereto and incorporated
herein by reference (hereinafter referred to as the 'Land').
ARTICLE II: TERM COMMENCEMENT
2.1 TERM OF LEASE. The term of this Lease shall be for a period of
THREE (3) years commencing on the Commencement Date (as hereinafter defined
in Section 2.2) and ending at midnight on the day THREE years following the
commencement date, unless otherwise earlier terminated pursuant to the terms,
covenants and conditions of this Lease or pursuant to law.
2.2 COMMENCEMENT OF TERM. The commencement date shall be the later of
(a) substantial completion of the improvements, or
(b) APRIL 1, 1999
ARTICLE III: MONTHLY RENT
3.1 BASE MONTHLY RENT. Tenant shall pay Landlord as rent for the
Premises in advance on the first day of each calendar month for the TERM of
the lease term without deduction, offset, prior notice or demand, the sum of
FIVE THOUSAND FOUR HUNDRED SIXTY-
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EIGHT AND 69/100 DOLLARS ($5,468.69) per month. If the Commencement Date is
not on the first day of the month, or if this Lease terminates on a day other
than the last day of the month, then the Base Monthly Rent, shall be prorated
at the then current rate for the fractional month or months, if any, during
which this Lease commences or terminates (hereinafter referred to as the
'Base Monthly Rent.')
ARTICLE IV: SECURITY DEPOSIT
Concurrently with Tenant's execution of this Lease, Tenant shall
deposit with Landlord the sum of ______________ ($5,468.69) (hereinafter
referred to as the 'Security Deposit.') The Security Deposit shall be held by
Landlord for the faithful performance by Tenant of the terms, covenants, and
conditions of this Lease. If Tenant defaults with respect to any provision of
this Lease, including but not limited to the provisions relating to the
payment of Base Monthly Rent, expenses and charges payable under the
provisions of this Lease, Landlord may, but shall not be obligated to use,
apply or retain all or a part of the Security Deposit for the payment of any
amount which Landlord may spend reasonably by reason of Tenant's default or
to compensate Landlord for any other loss or damage which Landlord may suffer
by reason of Tenant's default. If any portion of the Security Deposit is so
used or applied, Tenant shall, within ten (10) days after written demand,
deposit with Landlord an amount sufficient to restore the Security Deposit to
its original amount; and Tenant's failure to do so shall constitute a
material breach of this Lease. Landlord shall not be required to keep the
Security Deposit separate from Landlord's general funds, and Tenant shall not
be entitled to interest on the Security Deposit. If Tenant shall fully and
faithfully perform every provision of this Lease to be performed by Tenant,
the Security Deposit or any balance thereof shall be returned to Tenant or,
at Landlord's option, to the last permitted assignee of Tenant's interest
under this Lease at the expiration of the term of this Lease and after Tenant
or Tenant's permitted assignee has vacated the Premises. In the event of
termination of Landlord's interest in this Lease, Landlord shall transfer the
Security Deposit to Landlord's successor in interest, whereupon Tenant shall
release Landlord from liability for the return of the Security Deposit or any
accounting therefor.
ARTICLE V: LATE CHARGES
If Tenant fails to pay any Base Monthly Rent (as may be adjusted in
accordance with Article III of this Lease or if Tenant fails to pay any
additional amounts or charges of any character which are payable under this
Lease, such unpaid amounts shall bear interest from the date such payment is
due to the date of payment at the rate of eighteen percent (18%) per annum.
In addition, Landlord, at Landlord's election, may assess and collect a late
fee charge equal to five percent (5%) of each payment of Base Monthly Rent
(as may be adjusted in accordance with Section 3.2) not received within ten
(10) days from the date such payment is due.
ARTICLE VI: INSURANCE
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6.1 TENANT'S INSURANCE COVERAGE. Tenant shall, at all times during the
term of this lease, and at Tenant's own cost and expense, procure and
continue in force bodily injury and property damage liability insurance with
a single limit of not less than One Million Dollars ($1,000,000.00) per
occurrence insuring against any and all liability of the insured with respect
to the Premises or arising out of the maintenance, use or occupancy thereof,
and for the protection of the Tenant to maintain in force Fire Legal
Liability insurance in the amount of no less than Three Hundred Thousand
Dollars ($300,000.00) All such bodily injury liability insurance and property
damage liability insurance shall specifically insure the performance by
Tenant of the indemnity provision contained in Article XVII of this Lease as
to liability for injury to or death of persons, and injury or damage to
property. Tenant shall also maintain glass insurance to provide replacement
for any glass broken within the Premises.
6.2 INSURANCE POLICIES. The insurance policies shall name Landlord as
an additional insured and shall be with companies having a rate of not less
than 'A' company rating and a Financial Rating of Class VI in 'Best's
Insurance Reports.' Tenant shall furnish from the insurance companies or
cause the insurance companies to furnish to Landlord certificates of
coverage. No such policy shall be cancelable or subject to reduction of
coverage or other modification or cancellation except after thirty (30) days
prior to written notice to Landlord by the insurer. All such policies shall
be written as primary policies, not contributing with and not in excess of
any coverage which Landlord may carry. Tenant shall at least twenty (20) days
prior to the expiration of such policies furnish Landlord with renewals or
binders. If Tenant does not procure and maintain such insurance, Landlord
may, but is not obligated to, procure such insurance on Tenant's behalf and
all sums paid by Landlord shall bear interest at the annual rate of eighteen
percent (18%) until paid and shall be immediately due and payable.
6.3 PAYMENT OF INCREASED PREMIUMS. Tenant shall pay to Landlord upon
demand the amount of any increase in premiums for insurance against loss by
fire or other casualty that may be charged during the term of this Lease on
the amount of the insurance to be carried by Landlord on the Premises or the
Building resulting from Tenant doing any act in or about the Premises which
increases the insurance rates, whether or not Landlord shall have consented
to such act on the part of Tenant.
ARTICLE VII: UTILITIES AND JANITORIAL SERVICE
7.1 UTILITIES AND SERVICES.
(a) Landlord shall furnish to the Premises during reasonable
hours of generally recognized business days, as determined in Landlord's
reasonable discretion, from 7:00 a.m. until 6:00 p.m., Mondays through
Fridays and from 8:00 a.m. until 12:00 noon on Saturdays, water, electricity
and natural gas suitable for the intended use of the Premises; heat and air
conditioning; window washing services and elevator services to the extent
required, in Landlord's reasonable discretion for the comfortable use and
occupancy of the Premises.
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Landlord shall maintain, repair, clean, and keep lighted the common stairs,
entries, restrooms and other areas used in common by the tenants of the
Building. At the request of Tenant, Landlord shall provide the Premises with
after hours HVAC and utilities. Tenant shall be liable to Landlord for
Landlord's actual costs of supplying such services.
(b) Tenant shall be responsible for janitorial services within
the confines of the demised Premises.
7.2 ELECTRICITY AND NATURAL GAS USE. Tenant shall reimburse Landlord
its proportionate share of all electricity and natural gas used on the
premises. The percentage of participation is determined by the square footage
of the premises as compared to the total area of the Building. Tenant will
not, without the written consent of Landlord, use any apparatus or device in
the Premises, including without limitation electronic data processing
machines, punch card machines, vending, printing, and other types of machines
using current in excess of 110 volts, which will in any way increase the
amount of electricity usually furnished or supplied for use of the Premises
as a general business office space; nor connect any apparatus or device with
electrical current except through existing electrical outlets in the Premises.
7.3 METERS. If Tenant shall require water or electrical current in
excess of that usually furnished or supplied for use of the Premises as
GENERAL OFFICE, SOFTWARE DEVELOPMENT AND OTHER LEGAL RELATED USES space,
Tenant shall first procure the consent of Landlord for the use thereof, which
consent Landlord shall not unreasonably delay or withhold. If Landlord
consents, Landlord may calculate the cost of such service or may cause a
water meter or electric current meter to be installed in the Premises, so as
to measure the amount of water and electrical current consumed for any such
other use. The cost of such meters and of installation, maintenance, and
repair thereof shall be paid by Tenant, and Tenant shall pay Landlord
promptly upon demand by Landlord for all such water and electrical current
consumed as calculated by Landlord or as shown by the meters, at the rates
charged for such services by the local public utility furnishing the same,
plus any additional expense incurred in keeping account of the water and
electric current so consumed.
7.4 INTERRUPTION OF SERVICE. Landlord, except for acts of gross
negligence or willful negligence, shall not be liable in the event of any
interruption in the supply of utilities or services to Tenant, to the
Premises, or to the Building.
7.5 ADDITIONAL POWER. Notwithstanding anything to the contrary
contained in this Lease, Tenant shall have the option and Landlord hereby
consents to Tenant's installation of additional electrical capacity to and
within the Premises at Tenant's sole cost and expense. If Tenant so improves
the current electrical systems, Tenant shall also cause to be installed at
its sole cost and expense an electrical submeter or other device in order to
accurately have measured Tenant's electricity consumption. If Tenant does not
contract directly with the appropriate utility, which Tenant may do at its
sole option, then Landlord shall bill Tenant
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for the actual electricity used, at the rates charged by the local utility,
plus any reasonable additional expense incurred in keeping account of the
electricity so used by Tenant.
ARTICLE VIII: USE OF PREMISES
8.1 USE. The Premises shall be used and occupied by Tenant as a
GENERAL OFFICE, SOFTWARE DEVELOPMENT AND OTHER LEGAL RELATED USES and for no
other purpose without the prior written consent of Landlord. Tenant shall
have access to the Building and the Premises 24 hours per day, 7 days per
week.
8.2 SUITABILITY. Tenant acknowledges that neither Landlord nor any
agent of Landlord has made any representation or warranty with respect to the
Premises or the Building or with respect to the suitability of either for the
conduct of Tenant's business, nor has Landlord agreed to undertake any
modification, alteration or improvement to the Premises except as provided in
this Lease. The taking of possession of the Premises by Tenant shall
conclusively establish that the Premises and the Building are at the date of
possession in satisfactory condition. Landlord shall not be responsible for
any latent defects or deficiencies in the construction of the Premises or the
Building or any improvements or fixtures therein, unless Tenant shall, within
one (1) year from the Commencement Date, provide Landlord with written notice
which specifies in reasonable detail the nature and character of the defect
or deficiency. Landlord shall, within ninety (90) days from the date of
notice from Tenant, compete reasonable repairs and changes to eliminate such
defects and deficiencies; provided, however, that if such repairs cannot be
completed within ninety (90) days in the opinion of a registered architect or
engineer appointed by Landlord, Landlord, at Landlord's election, may give
notice to Tenant terminating this Lease as of the date specified in the
notice, which date shall not be less than thirty (30) days after giving
notice. This Lease shall continue in full force and effect during any period
of repair; provided, however, that the rent shall be reduced by a
proportionate reduction based upon the extent, if any, to which the defects
or deficiencies interfere with the use and occupancy of Tenant.
Notwithstanding anything to the contrary in this Lease:
(a) Landlord at its sole cost and expense shall recarpet and
repaint the Premises to landlord's building standard quality and design.
Landlord shall also replace damaged ceiling tiles, replace lights as needed
and clean light lens covers and replace damaged lens.
(b) To the best of Landlord's knowledge at the commencement of
the Lease term the Premises comply with all regulations, local, state and
federal laws, ordinances and codes, and the electrical, plumbing, HVAC, and
roof system are in good working condition.
In the event of any breach of any of the foregoing warranties, Landlord shall
promptly rectify the same at its sole cost and expense and shall indemnify,
defend, and hold Tenant harmless from and against any damages, liability,
suits, losses, claims, actions, costs or expense (including attorneys' and
consultants' fees and costs) suffered by Tenant in connection with any such
breach.
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8.3 PROHIBITED USES.
(a) Tenant shall not do or permit anything to be done in or
about the Premises, nor bring or keep anything therein which will in any way
increase the existing premium rate or affect any fire or other insurance upon
the Building or any of the Building's contents, unless Tenant shall pay any
increased premium as a result of such use or acts, or cause a cancellation of
any insurance policy covering the Building or any part of the Building or any
of the Building's contents, nor shall Tenant sell or permit to be kept, used
or sold in or about the Premises any articles which may be prohibited by a
standard form policy of fire insurance.
(b) Tenant shall not do or permit anything to be done in or
about the Premises which will in any way unreasonably obstruct or interfere
with the rights of other tenants or occupants of the Building or injure or
annoy them, or use or allow the Premises to be used for any unlawful or
objectionable purpose, nor shall tenant cause, maintain or permit any
nuisance in or about the Premises. Tenant shall not commit or suffer to be
committed any waste in or upon the Premises.
(c) Tenant shall not use the Premises or permit anything to be
done in or about the Premises which will in any way conflict with any law,
statute, ordinance or governmental rule or regulation or requirement of duly
constituted public authorities now in force or which may hereafter be
enacted, promulgated or created. Tenant shall, at Tenant's sole cost and
expense, promptly comply with all laws, statutes, ordinances and governmental
rules, regulations or requirements now in force or which may hereafter be in
force and with the requirements of force or which may hereafter be in force
and with the requirements of any board of fire underwriters or other similar
body now or hereafter constituted relating to or affecting the use or
occupancy of the Premises, excluding structural changes not relating to or
affecting the use or occupancy of the Premises, or not related or afforded by
Tenant's improvements or acts. Notwithstanding the foregoing or anything to
the contrary contained in this Lease, Tenant shall not be responsible for
compliance with any laws, codes, ordinances or other governmental directives
where such compliance is not related specifically to Tenant's use and
occupancy of the Premises. For example, if any governmental authority should
require the Building or the Premises to be structurally strengthened against
earthquake, or should require the removal of asbestos from the Premises and
such measures are imposed as a general requirement applicable to all tenants
rather than as a condition to Tenant's specific use or occupancy of the
Premises, such work shall be performed by and at the sole cost of Landlord.
ARTICLE IX: FIXTURES AND ALTERATIONS
9.1 ALTERATIONS. Tenant shall not make any physical alterations in the
Premises or any of the fixtures located therein or install or cause to be
installed any trade fixtures, exterior signs, floor coverings, interior or
exterior lighting, plumbing fixtures, shades or awnings or make any changes
to the Premises or Building without first obtaining the written consent of
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Landlord, which consent shall not be unreasonably withheld. Tenant shall present
to Landlord plans and specifications for the installation of any improvements or
fixtures at the time approval is sought from Landlord. Any physical change and
all rearrangements which are made by Tenant with the approval of Landlord shall
be made at Tenant's expense. Such alternations, decorations, additions and
improvements shall not be removed from the Premises during the term of this
Lease without the prior written consent of Landlord. Upon expiration of this
Lease all such alterations, decorations, additions and improvements shall at
once become the Property of landlord, without payment to Tenant. Notwithstanding
the provisions of Paragraph 9.1:
(a) Tenant shall be entitled to make alterations, additions, improvements
and utility installations in or to the Premises, without the prior consent of
Landlord, so long as each of the same (i) that the total cost of any single
alterations, additions, improvements and utility installations do not exceed the
sum of $2,500 in cost, (ii) do not affect any structural or exterior portions of
the Building or adversely affect the Building electrical, plumbing or HVAC
systems, and (iii) Tenant will not permit mechanics' liens to be filed against
the Building or Premises, and if a lien is filed then the Tenant will remove
lien or post a bond for at lease 2-times the amount of the lien within ten (10)
days from written notice of Landlord.
(b) Tenant shall not be required to remove any alterations, additions,
improvements or Utility Installations for which Tenant has obtained Landlord's
consent, unless Landlord has indicated at the time of granting such consent,
that such removal will be required at the end of the Lease term.
(C) At the expiration, or at any time during the term of this Lease,
Tenant shall be entitled to remove, in addition to its furniture, trade
fixtures, and other personal property, any fixtures, alterations additions and
improvements including but not limited to any Tenant installed HVAC systems,
provided that Tenant repairs any damage caused by such removal.
9.2 SIGNS, POSTERS, WINDOW COVERINGS ON PREMISES. Tenant shall not
affix any signs, posters, window coverings, or other materials to the inside
surface of the exterior windows of the premises, or to any glass partitions,
if any, separating the Premises from the Common Areas of the building without
first obtaining the written consent of Landlord.
9.3 CONDITIONS AND LIMITATIONS. Landlord may impose as a condition to
granting any consent required by Section 9.1, such reasonable requirements,
restrictions and limitations as Landlord may deem necessary in Landlord's
reasonable discretion, and as agreed upon in Section 9.1, including without
limitation, the manner in which the work is done, the contractors by whom it is
performed, and the time during which the work is accomplished.
9.4 CONTRACTORS AND MATERIALMEN. If any fixtures, alterations or
improvements are allowed by Landlord, Tenant shall promptly pay all contracts
and materialmen, so as to eliminate the possibility of a lien attaching to the
Building or the Land, and should any such lien be made or filed, for any reason,
Tenant shall discharge the same within ten (10) days after written request by
Landlord or, with the written consent of the Landlord, Tenant may obtain a bond,
in an amount satisfactory to Landlord, insuring the discharge of any mechanic's
lien or liens for labor or materials arising out of work by Tenant upon the
Premises, and further indemnifying and holding Landlord harmless from any
actions, proceedings, claims, demands, losses, outlays, damage or expenses,
including legal fees, which may in any way arise out of or be caused by the lien
or liens. Landlord shall have the right, but not the obligation, to pay
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and discharge any such lien that attaches to the Premises or the Land, and
Tenant shall reimburse Landlord for any such sums paid, together with
interest at the rate of eighteen percent (18%) [per annum] within ten (10)
days after written demand by Landlord.
9.5 ADDITIONAL HVAC. Subject to Sections 9.3 and 9.4, Landlord
hereby consents to Tenant's installation at Tenant's sole cost and expense of
additional HVAC systems to service the Premises.
ARTICLE X: MAINTENANCE AND REPAIRS
10.1 LANDLORD'S OBLIGATIONS. Landlord shall maintain in good order,
condition and repair the Building, the Common Areas, the Land and all
portions of the Premises which are not the obligation of Tenant or any other
tenant in the Building, including, but not limited to, the roof, bearing
walls or supports, exterior surfaces and foundation of the Building, window
frames, gutters and downspouts, heating, refrigeration, air
conditioning, central electrical, plumbing and sewage systems, elevators,
landscaping, real estate taxes, fire and liability insurance and common area
janitorial services.
10.2 TENANT'S OBLIGATIONS. Tenant's obligations shall include,
but are not limited to, the following:
(a) In addition to all other payments by Tenant to Landlord
required by this Lease, Tenant shall pay to Landlord, for each year or
portion thereof after the 'Base Year' during the term of this Lease, Tenant's
Proportionate Share of annual Common Area, Building and Land Expenses,
described in item 10.1, over the amount incurred in the 'Base Year.' As used
herein, the 'Base Year' shall mean the calendar commencing January 1 and
ending December 31 of the year in which the Commencement Date occurs and the
'Base Year Expense' shall mean the total amount of Common Area, Building and
Land Expenses incurred in such Base Year. Notwithstanding anything to the
contrary contained in this Lease, the following shall not be included within
Common Area, Building and Land Expenses:
Leasing commissions, attorneys' fees, costs, disbursements, and
other expenses incurred in connection with negotiations or disputes with
tenants, or in connection with leasing, renovating, or improving space for
tenants or other occupants or prospective tenants or other occupants of the
Building.
The cost of any service sold to any tenant (including Tenant) or
other occupant for which Landlord is entitled to be reimbursed as an additional
charge or rental over and above the basic rent and escalations payable under the
lease with that tenant.
Any depreciation on the Building or Property.
Costs of a capital nature, including but not limited to capital
improvements and alterations, capital repairs, capital equipment, and capital
tools as determined in accordance with generally accepted accounting principles.
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Expenses in connection with services or other benefits of a type
that are not provided to Tenant but which are provided another tenant or
occupant of the Building or Property.
Costs incurred due to Landlord's violation of any terms or
conditions of this Lease or any other lease relating to the Building or
Property.
Overhead profit increments paid to Landlord's subsidiaries or
affiliates for management or other services on or to the building or for
supplies or other materials to the extent that the cost of the services,
supplies, or materials exceeds the cost that would have been paid had the
services, supplies, or materials exceeds been provided by unaffiliated parties
on a competitive basis.
All interest, loan fees, and other carrying costs related to any
mortgage or deed of trust or related to any capital item, and all rental and
other payable due under any ground or underlying lease, or any lease for any
equipment ordinarily considered to be of a capital nature (except janitorial
equipment which is not affixed to the Building.)
Any compensation paid to clerks, attendants, or other persons in
commercial concessions operated by Landlord.
Advertising and promotional expenditures.
Costs of repairs and other work occasioned by fire, windstorm, or
other casualty of an insurable nature.
Any costs, fines, or penalties incurred due to violations by
Landlord of any governmental rule or authority, this Lease or any other lease in
the Property, or due to Landlord's negligence or willful misconduct.
Management costs to the extent they exceed management costs
charged for similar facilities in the area and in any event, to the extent they
exceed 5% of all other Common Area, Building and Land Expenses.
Costs for sculpture, paintings, or other objects of art (nor
insurance thereon or extraordinary security in connection therewith).
Wages, salaries, or other compensation paid to any executive
employees above the grade of building manager.
The cost of correcting any building code or other violations which
were violations prior to the Commencement Date.
The cost of containing, removing, or otherwise remediating any
contamination of the Property (including the underlying land and ground
water) by any toxic or hazardous materials (including, without limitations,
asbestos and 'PCB's') where such contamination was not caused by Tenant.
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Any other expense that under generally accepted accounting
principles and practice consistently applied would not be considered a normal
maintenance or operating expense.
(b) Tenant, at Tenant's sole cost and expense, shall maintain
the Premises in good order, condition and repair including the interior
surfaces of the ceilings, walls and floors, along with all doors, windows,
fixtures, furnishings and equipment including electrical and plumbing. Tenant
shall also replace all light bulbs and florescent tubes as necessary and
shall be responsible for janitorial service within the leased premises.
(c) The cost of any maintenance and repair, janitorial or other
services which become necessary as a result of any wrongful or negligent act or
omission of Tenant or Tenant's employees, invitees or licensees shall be borne
by Tenant.
(d) Upon the expiration or earlier termination of this Lease,
Tenant shall surrender the Premises in the same condition as received,
ordinary wear and tear and damage due to acts of God; strikes, lockouts, or
other industrial disturbances; acts of public enemy, blockades, wars,
insurrections, or riots; epidemics; landslides, earthquakes, fires, storms,
floods, or washouts; arrests, title disputes, or other litigation;
governmental restraints, either federal or state, civil or military; civil
disturbances; explosions; inability to obtain necessary materials, supplies,
labor, or permits due to existing or future rules, regulations, orders, laws,
or proclamations, either federal or state, civil or military; and other
causes beyond the control of such party or condemnation excepted, and shall
promptly remove or cause to be removed at Tenant's expense from the Premises
and the Building any signs, notices and displays placed by Tenant.
(e) Tenant shall repair any damage to the Premises or the
Building caused by or in connection with the removal of any articles of
personal property, machinery, equipment, or furniture, including, without
limitation thereto, repairing the floor and patching and painting the walls
where required by Landlord to Landlord's reasonable satisfaction, all at
Tenant's cost and expense. Tenant shall indemnify Landlord against any loss
or liability resulting from delay by Tenant in so surrendering the Premises,
including without limitation any claims made by any succeeding tenant founded
on such delay.
(f) In the event Tenant fails to maintain the Premises in good
order, condition and repair, Landlord shall give Tenant notice to do such
acts as are reasonably required to so maintain the Premises. In the event
Tenant fails to promptly commence such work and diligently prosecute it to
completion, then Landlord shall have the right to do such acts and expend
such funds at the expense of Tenant as are reasonably required to perform
such maintenance. Any amount so expended by Landlord shall be paid by Tenant
together with interest thereon at the rate of eighteen percent (18%) per
annum from the date of such repairs or maintenance upon written demand from
Landlord. Landlord shall have no liability to Tenant for any damage,
inconvenience or interference with the use of the Premises by Tenant as a
result of performing any such maintenance.
ARTICLE XI: DAMAGE OR DESTRUCTION
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11.1 PARTIAL DAMAGE - INSURED. In the event the Premises or the Building
are damaged by any casualty which is covered under fire and extended coverage
insurance carried by Landlord, then Landlord shall restore the Building,
provided insurance proceeds are available to pay eighty percent (80%) or more
of the cost of restoration and provided such restoration can be completed within
ninety (90) days after the commencement of the restoration in the opinion of a
registered architect or engineer appointed by Landlord. In such event, this
Lease shall continue in full force and effect, except that Tenant shall be
entitled to a proportionate reduction of rent while such restoration takes
place. Such proportionate reduction of rent shall be based upon the extent to
which the damaged portion of the Premises or the restoration efforts interfere
with Tenant's business in the Premises.
11.2 PARTIAL DAMAGE - UNINSURED. In the event the Premises or the
Building are damaged by a risk not covered by the Landlord's fire and
extended coverage insurance or if the proceeds of the available insurance are
less than eighty percent (80%) of the cost of restoration, or if the
restoration cannot be completed within ninety (90) days after the
commencement of the restoration, in the opinion of the registered architect
or engineer appointed by Landlord, then Landlord shall have the option either
to (1) repair or restore such damage, and if Landlord so elects to repair,
this Lease shall continue in full force and effect, but the rent shall be
proportionately abated as provided in Section 11.1 of this Lease, or (2)
terminate this lease by giving written notice to Tenant, at any time within
thirty (30) days after such damage. In the event Landlord give Tenant the
notice of termination required by this Section 11.2, this Lease shall expire
and all interest of Tenant in the Premises shall terminate on the date
specified in the notice, and the rent, reduced by a proportionate reduction
based upon the extent, if any, to which such damage interfered with the use
and occupancy of Tenant, shall be paid to the date of termination. Landlord
shall refund to Tenant any rent paid in advance for any period of time
subsequent to the date of termination. Notwithstanding anything to the
contrary contained herein, if Tenant's use of the Premises is substantially
impaired for a period of more than 90 days after the date of casualty, Tenant
shall have the right to terminate this Lease by written notice to Landlord at
any time thereafter until Tenant's use of the Premises is substantially
restored.
11.3 TOTAL DESTRUCTION. In the event the Premises are totally destroyed
or the Premises cannot be restored as required in this Lease, or as required
under applicable laws, notwithstanding the availability of insurance proceeds,
this Lease shall terminate as of the date of damage.
11.4 LANDLORD'S OBLIGATIONS. Landlord shall not be required to repair any
injury or damage by fire or other cause, or to make any restoration or
replacement of any panelings, decorations, partitions, railing, floor covering,
office fixtures or any other improvements or property installed in the Premises
by Tenant or at the direction or indirect expense of Tenant.
11.5 TENANT'S CLAIMS AGAINST LANDLORD. Except for abatement of rent, if
any, Tenant shall have no claim against Landlord for any damage suffered by
reason of any such damage, destruction repair or restoration unless such damage
is caused by the intentional act or negligence of Landlord or Landlord's
designated agents or employees.
ARTICLE XII: CONDEMNATION
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If all or any part of the Premises is taken or appropriated for public
or quasi-public use by right of eminent domain with or without litigation or
transferred by agreement in connection with such public or quasi-public use,
Landlord and Tenant shall each have the right within thirty (30) days of
receipt of notice of taking, to terminate this Lease as of the date
possession is taken by the condemning authority; provided, however, that
before Tenant may terminate this Lease by reason of taking or appropriation,
such taking or appropriation shall be of such an extent and nature as to
substantially handicap, impede or impair Tenant's use of the Premises. If any
part of the Building other than the Premises shall be so taken or
appropriated, Landlord shall have the right at Landlord's option to terminate
this Lease. No award for any entire taking shall be apportioned, and Tenant
hereby assigns to Landlord any award which may be made in such taking or
condemnation, together with any and all rights of Tenant now or hereafter
arising in or to the award of any portion thereof; provided, however, that
nothing contained herein shall be deemed to give Landlord any interest in or
to require Tenant to assign to Landlord any award made to Tenant for the
taking of personal property belonging to Tenant, and for the interruption of
or damage to Tenant's business. In the event of a partial taking which does
not result in a termination of this Lease, the Base Monthly Rent shall be
abated in the proportion which the part of the Premises so made unusable
bears to the rented area of the Premises; and any award made to Tenant by
reason of any such temporary taking shall belong entirely to Tenant, and
Landlord shall not be entitled to any portion thereof.
ARTICLE XIII: ASSIGNMENT AND SUBLETTING
13.1 LANDLORD'S CONSENT REQUIRED. Tenant shall not assign, transfer,
mortgage, pledge, hypothecate or encumber this Lease or any interest therein
either voluntarily or involuntarily by operation of law or otherwise, and Tenant
shall not sublet the Premises or any part thereof, without the prior written
consent of Landlord, and any attempt to do so shall be wholly void and shall, at
Landlord's election constitute a default under this Lease.
13.2 REASONABLE CONSENT. If Tenant complies with the following
conditions, Landlord shall not unreasonably withhold Landlord's consent to the
subletting of the Premises or any portion thereof or the assignment of this
Lease. Tenant shall submit in writing to Landlord (a) the name and legal
composition of the proposed subtenant or assignee; (b) the nature of the
business proposed to be carried on in the Premises; (c) the terms and provisions
of the proposed sublease; and (d) such reasonable financial information as
Landlord may request concerning the proposed subtenant or assignee.
13.3. NO RELEASE OF TENANT. No consent by Landlord to any assignment
or subletting by Tenant shall relieve Tenant of any obligation to be
performed by Tenant under this Lease, whether occurring before or after such
consent, assignment or subletting. The consent by Landlord to any assignment
or subletting shall not relieve Tenant from the obligation to obtain
Landlord's express written consent to any other assignment or subletting. The
acceptance of rent by Landlord from any other person or legal entity shall
not be deemed to be a waiver by assignment, subletting or other transfer.
Consent to one assignment, subletting or other transfer shall not be deemed
to constitute consent to any subsequent assignment, subletting or other
transfer.
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13.4 INCREASED EXPENSES. Tenant shall pay Landlord the amounts of any
increase in costs or expenses incident to the occupancy of the Premises by
such assignee or subtenant, including but not limited to, any increase in
Landlord's insurance premiums and reasonable attorney's fees incurred in
connection with giving such consent.
13.5 ASSIGNMENT AND SUBLETTING. Tenant may not assign this Lease or
sublet the Premises, or any portion thereof, without Landlord's prior written
consent, except to any entity which controls, is controlled by, or is under
common control with Tenant; to any entity which results from a merger of,
reorganization of, or consolidation with Tenant; to any entity engaged in a
joint venture with Tenant; or to any entity which acquires substantially all
of the stock or assets of Tenant, as a going concern, with respect to the
business that is being conducted in the Premises (hereinafter each a
'Permitted Transfer'). In addition, a sale or transfer of the capital stock
of Tenant shall be deemed a Permitted Transfer if (1) such sale or transfer
occurs in connection with any BONA FIDE financing or capitalization for the
benefit of Tenant, or (2) Tenant is or becomes a publicly traded corporation.
Landlord shall have no right to terminate the Lease in connection with, and
shall have no right to any sums or other economic consideration resulting
from any Permitted Transfer. Anything to the contrary notwithstanding Tenant
shall remain jointly or severly liable for the Lease.
ARTICLE XIV: SUBORDINATION, QUIET ENJOYMENT AND ATTORNMENT
14.1 SUBORDINATION. Subject to Tenant's receipt of a reasonably
satisfactory non-disturbance agreement the approval of which shall not be
unreasonably withheld or delayed, this Lease at Landlord's option shall be
subject and subordinate to the lien of any mortgages or deed of trust in any
amount or amounts whatsoever now or hereafter placed on or against the Land,
the Building, on or against Landlord's interest or estate therein, without
the necessity of the execution and delivery of any further instruments on the
part of Tenant to effectuate such subordinations.
14.2 SUBORDINATION AGREEMENT. Subject to Tenant's receipt of a
reasonably satisfactory non-disturbance agreement the approval of which shall
not be unreasonably withheld or delayed, Tenant shall execute and deliver
upon demand, without charge therefor, such further instruments evidencing
such subordination of this Lease to the lien of any such mortgages or deeds
of trust as may be required by Landlord. Tenant hereby irrevocably appoints
Landlord as Tenant's attorney-in-fact, coupled with an interest (which power
shall not be affected by the disability of Tenant) to execute and deliver any
such agreements, instruments, releases or other documents.
14.3 QUIET ENJOYMENT. Upon paying rent and other sums or amounts due
under the Lease, and performing Tenant's covenants and conditions under the
Lease, Tenant shall and may peaceably and quietly have, hold and enjoy the
Premises for the term of this Lease, subject, however, to the terms,
covenants and conditions of this Lease and of any mortgage or deed of trust
described in Section 14.1.
14.4 ATTORNMENT. In the event of foreclosure or the exercise of the
power of sale under any mortgage or deed of trust made by Landlord covering the
Premises or the Building, Tenant shall attorn to the purchaser upon any such
foreclosure or sale and recognize such
13
purchaser as the Landlord under this Lease, provided said purchaser expressly
agrees in writing to be bound by the terms of this Lease.
ARTICLE XV: DEFAULT AND REMEDIES
15.1 DEFAULT. The occurrence of any of the following shall constitute
a material default and breach of this Lease by Tenant:
(a) Any failure by Tenant to pay the Base Monthly Rent, Base
Monthly Rent Adjustments or any other monetary sums required to be paid under
this Lease, where such failure continues for five (5) business days after
written notice thereof by Landlord to Tenant:
(b) The abandonment of the Premises by Tenant;
(c) A failure by Tenant to observe and perform any other terms,
covenants or condition of this Lease to be observed or performed by Tenant,
where such failure continues for twenty (20) days after written notice
thereof by Landlord to Tenant; provided, however, that if the nature of the
default cannot reasonably be cured within the twenty (20) days period, Tenant
shall not be deemed to be in default if Tenant shall within the twenty (20)
day period commence action to cure the default and thereafter diligently
prosecutes the same to completion;
(d) The making by Tenant of any general assignment or general
arrangement for the benefit of creditors; the filing by or against Tenant or
a petition to have Tenant adjudged a bankrupt or of a petition for
reorganization or arrangement under any law relating to bankruptcy (unless,
in the case of a petition filed against Tenant, the same is dismissed within
sixty (60) days); the appointment of a trustee or receiver to take possession
of substantially all of Tenant's assets located at the Premises or of
Tenant's interest in this Lease, where possession is not restored to Tenant
within sixty (60) days; or the attachment, execution, or other judicial
seizure of substantially all of Tenant's assets located at the Premises or of
Tenant's interest in this Lease, where such seizure is not discharged within
sixty (60) days.
15.2 NONEXCLUSIVE REMEDIES. In the event of any such material default by
Tenant, Landlord shall have the right to continue this Lease in full force and
effect and to collect all Base Monthly Rent, Base Monthly Rent Adjustments, and
other fees to be paid by Tenant under this Lease as and when due. During any
period that Tenant is in default, Landlord shall have the right, pursuant to
legal proceedings or pursuant to any notice provided for by law, to enter and
take possession of the Premises, without terminating this Lease, for the purpose
of reletting the Premises or any part thereof and making any alterations and
repairs that may be necessary or desirable in connection with such reletting.
Any such reletting or relettings may be for such term or terms (including
periods that exceed the balance of the term of this Lease), and upon such other
terms, covenants and conditions as Landlord may in Landlord's sole discretion
deem advisable. Upon each and any such reletting , the rent or rents received by
Landlord from such reletting shall be applied as follows: (1) to the payment of
any indebtedness (other than rent) due hereunder from Tenant to Landlord; (2) to
the payment of costs and expenses of such reletting, including brokerage fees,
attorney's fees, court costs, and costs of any alterations or repairs; (3) to
the payment of Base Monthly Rent, Base Monthly
14
Rent Adjustments and other amounts due and unpaid hereunder; and (4) the
residue, if any, shall be held by Landlord and applied in payment of future
Base Monthly Rent, Base Monthly Rent Adjustments and other amounts as they
become due and payable hereunder. If the rent or rents received during any
month and applied as provided above shall be insufficient to cover all such
amounts including the Base Monthly Rent, Base Monthly Rent Adjustments and
other amounts to be paid by Tenant pursuant to this Lease for such month,
Tenant shall pay to Landlord any deficiency; such deficiencies shall be
calculated and paid monthly. No entry or taking possession of the Premises by
Landlord shall be construed as an election by Landlord to terminate this
Lease, unless Landlord gives written notice of such election to Tenant or
unless such termination shall be decreed by a court of competent
jurisdiction. Notwithstanding any reletting by Landlord without termination,
Landlord may at any time thereafter terminate this Lease for such previous
default by giving written notice thereof to Tenant.
(b) Terminate Tenant's right to possession by notice to Tenant,
in which case this Lease shall terminate and Tenant shall immediately
surrender possession of the Premises to Landlord. In such event Landlord
shall be entitled to recover from Tenant all damages incurred by Landlord by
reason of Tenant's default, including without limitation the following: (1)
all unpaid rent which has been earned at the time of such termination
(together with interest thereon at the rate of eighteen (18%) per annum to
the time of award) plus (2) the amount by which the unpaid rent which would
have been earned after termination until the time of award (together with
interest thereon at the rate of eighteen percent (18%) per annum) exceeds
the amount of such rental loss that is proved could have been reasonably
avoided; and (3) any other amount necessary to compensate Landlord for all
the detriment proximately caused by Tenant's failure to perform Tenant's
obligations under this Lease as may be permitted form time to time. Upon any
such re-entry, Landlord shall have the right to make any reasonable repairs,
alterations or modifications to the Premises which Landlord in Landlord's
reasonable discretion deems reasonable and necessary.
15.3 ADDITIONAL REMEDIES, COSTS AND EXPENSES. In addition to the
nonexclusive remedies provided in Section 15.2 above, Landlord shall have all
remedies now or hereafter provided by law for enforcing the provisions of
this Lease and Landlord's rights hereunder. In the event of any default under
this Lease, Landlord shall be entitled to recover from Tenant all costs and
expenses, including reasonable attorney's fees and court costs, incurred by
Landlord (with or without suit and before or after judgment) in obtaining
possession of the Premises, in collecting any Base Monthly Rent and any
adjustments thereto or other amounts due under the terms of this Lease and in
enforcing the provisions of this Lease or any right of Landlord under this
Lease.
15.4 DEFAULT BY LANDLORD. Landlord shall not be in default unless
Landlord fails to perform obligations required of Landlord within a
reasonable time, but in no event later than thirty (30) days after written
notice by Tenant to Landlord, specifying the nature of Landlord's default;
provided, however, that if the nature of the Landlord's obligation is such
that more than thirty (30) days are required for performance, then Landlord
shall not be in default if Landlord commences performance within the thirty
(30) day period and thereafter proceeds with reasonable diligence and in good
faith to complete the required performance.
15
ARTICLE XVI: ENTRY BY LANDLORD
Landlord shall, during the term of this Lease, have the right to enter
the Premises to inspect the same at reasonable time and upon reasonable
notice to Tenant (taking into consideration the nature of Tenant's business),
to submit the Premises to prospective purchasers or tenant (but only after
Tenant's normal business hours) and to alter, improve or repair the Premises
and any portion of the Building without abatement of rent. Landlord may for
that purpose erect scaffolding and other necessary structures where
reasonably required by the character of the work to be performed; provided
however, that the entrance to the Premises shall not be blocked thereby, and
further provided that the business of Tenant shall not be interfered with
unreasonably. For each of the aforesaid purposes, Landlord shall at all times
have and retain a key with which to unlock all of the doors in, upon and
about the Premises, excluding Tenant's vaults and safes. Landlord shall have
the right to use any and all means which Landlord may deem proper to open the
doors in an emergency, in order to obtain entry to the Premises, and any
entry to the Premises obtained by Landlord by such means or otherwise shall
not under any circumstances be construed or deemed to be a forcible or
unlawful entry into, a detainer of the Premises, or any eviction of Tenant
from the Premises or any portion thereof. Notwithstanding the provisions of
Article XVI, Landlord shall provide Tenant with at least 48 hours' prior
actual notice before entering the Premises. In the event of an emergency, the
determination of which shall require Landlord to be reasonable, Landlord
shall use its best efforts to provide Tenant with notice reasonable in such
situation.
ARTICLE XVII: INDEMNITY
17.1 INDEMNITY. Tenant shall indemnify and hold Landlord harmless from
any and all claims of liability for any injury or damage to any person or
property whatsoever (a) occurring in, on or about the Premises or any part
thereof; and (b) occurring in, on or about any common area, including, but
not limited to, all elevators, stairways, passageways, hallways and parking
areas, and the use of which Tenant may have in conjunction with other tenants
of the Building, when such injury or damage is caused in part or in whole by
the negligence or willful misconduct of Tenant, Tenant's agents, contractors,
employees, licensees or invitees. Tenant shall further indemnify and hold
Landlord harmless from and against any and all claims arising from any breach
or default in the performance of any obligation on Tenant's part to be
performed under the terms of this Lease, or arising from any negligence of
Tenant, or any of Tenant's agents, contractors, employees, licensees or
invitees and from and against all costs, attorney's fees, expenses and
liabilities incurred in the defense of any such claim or any action or
proceeding brought thereon. Tenant shall not, however, be liable for damage
or injury occasioned by the negligence or intentional acts of Landlord and
Landlord's designated agents or employees, or a breach of this Lease by
Landlord.
17.2 ATTORNEY'S FEES AND COSTS. The obligation to indemnify shall include
reasonable legal and investigation costs and all other reasonable costs,
expenses and liabilities from the first notice that any claim or demand is to be
made or may be made.
ARTICLE XVIII: ESTOPPEL CERTIFICATES
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18.1 REQUIREMENTS. Tenant shall, within ten (10) days from receipt or
prior written notice from Landlord, execute, acknowledge and deliver to Landlord
a statement in writing (a) certifying that this Lease is unmodified and in full
force and effect or, if modified, stating the nature of such modification and
certifying that this Lease, as so modified, is in full force and effect and the
date to which the rent and other charges have been paid, and if to Tenant's
knowledge, there are any uncured defaults on the part of Landlord hereunder, or
specifying such defaults if any are claimed. Any such statement may be
conclusively relied upon by any prospective purchaser or encumbrancer of the
Premises or the Building.
18.2 FAILURE TO DELIVER. If Tenant fails to deliver such statement within
the time period referred to in Section 18.1, it shall be deemed conclusive upon
Tenant (a) that this Lease is in full force and effect, without modification
except as may be represented by Landlord, (b) that there are no uncured defaults
in Landlord's performance, and (c) that not more than one month's rent has been
paid in advance.
ARTICLE XIX: PARKING
Tenant shall have the right to use free of charge and in common with
other tenants or occupants of the Building its pro-rata share of the parking
facilities of the Building, if any, subject to the rules and regulations of
Landlord for such parking facilities which may be established or altered by
Landlord at any time or from time to time during the term thereof.
ARTICLE XX: MISCELLANEOUS
20.1 TRANSFER OF LANDLORD'S INTEREST. In the event of a sale or
conveyance by Landlord of Landlord's interest in the Premises or the Building
other than a transfer for security purposes only, Landlord shall be relieved
from and after the date specified in any such notice of transfer of all
obligations and liabilities accruing after such sale or conveyance on the part
of Landlord, provided that any funds in the possession of Landlord at the time
of transfer in which Tenant has an interest shall be delivered to the successor
of Landlord.
20.2 CAPTIONS. The captions of the Articles and Section of this Lease
are for convenience only and shall not be deemed to be relevant in resolving any
question of interpretation or construction of any Section of this Lease.
20.3 ENTIRE AGREEMENT. This Lease constitutes the entire agreement
between Landlord and Tenant relative to the Premises, and this Lease may be
altered, amended or revoked only by an instrument in writing signed by both
Landlord and Tenant. All prior or contemporaneous oral agreements between and
among the Landlord and Tenant and their agents or representatives relative to
the leasing of the Premises are merged in or revoked by this Lease. This Lease
is the product of negotiations between the parties.
20.4 SEVERABILITY. If any term or provision of this lease shall, to any
extent, be determined by a court of competent jurisdiction to be invalid or
unenforceable, the remainder of this Lease shall not be affected thereby, and
each term and provision of this Lease shall be valid and be enforceable and to
the fullest extent permitted by law.
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20.5 COST OF SUIT.
(a) If Tenant or Landlord shall bring any action for any relief
against the other, declaratory or otherwise, arising out of this Lease,
including any suit by Landlord for the recovery of rent or possession of the
Premises, the losing party shall pay the successful party a reasonable sum for
attorney's fees and costs whether or not such action is prosecuted to judgment.
(b) Should Landlord, without fault on Landlord's part, be made a
party to any litigation instituted by Tenant or by any third party against
Tenant, or by or against any person holding under or using the Premises by
license or Tenant, or for the foreclosure of any lien for labor or material
furnished to or for Tenant or any such other person or otherwise arising out of
or resulting from any act or transaction of Tenant or of any such person, Tenant
shall save and hold Landlord harmless from any judgment rendered against
Landlord, the Land or the Building or any apart thereof, and all costs and
expenses, including reasonable attorneys' fees and costs, incurred by Landlord
in or in connection with such litigation.
20.6 TIMES AND REMEDIES. Time is of the essence of this Lease and every
provision hereof, except as to the conditions relating to the delivery of
possession of the Premises to Tenant. All rights and remedies of the parties
shall be cumulative and nonexclusive of any other remedy at law or in equity.
20.7 BINDING EFFECT, SUCCESSORS AND CHOICE OF LAW. Subject to any
provisions restricting assignment or subletting by Tenant, all of the terms
hereof shall bind and inure to the benefit of the parties hereto and their
respective heirs, legal representatives, successors and assigns. This Lease
shall be governed by the laws of the State of Utah.
20.8 WAIVER. No term, covenant or condition of this Lease shall be deemed
waived, except by written consent of the party against whom the wavier is
claimed, and any waiver of the breach of any covenant, term or condition shall
not be deemed to be a waiver of any preceding or succeeding breach of the same
or any other term, covenant or condition. Acceptance by Landlord of any
performance by Tenant after the time the same shall have become due shall not
constitute a waiver by Landlord of the breach or default of any term, covenant
or condition unless otherwise expressly agreed to by Landlord in writing.
Acceptance by Tenant of any performance by Landlord after the time the same
shall have become due, shall not constitute a waiver by Tenant of the breach by
default of any term, covenant or condition unless otherwise expressly agreed to
by Tenant in writing.
20.9 SURRENDER OF PREMISES. The voluntary or other surrender of this
Lease by Tenant, or a mutual cancellation of this Lease shall, at Landlord's
election, terminate all or any existing subleases or subtenancies, or may, at
Landlord's election, operate as an assignment to Landlord of any or all such
subleases or subtenancies provided, however, that such surrender, cancellation
or termination shall not relieve Tenant of any obligation under this Lease.
20.10 HOLDING OVER. If Tenant remains in possession of all or any part of
the Premises after the expiration of the term of this Lease, with or without the
express or implied consent of Landlord, such tenancy shall be from month to
month only, and not a renewal hereof or
18
an extension for any further term, and in such case, the rent and other sums
due hereunder shall be payable in an amount equal to one hundred twenty-five
percent (125%) of the adjusted annual rental specified in the lease
immediately prior to the expiration and at the time specified in this Lease
and such month-to-month tenancy shall be subject to every other term,
covenant and condition contained in this Lease.
20.11 SIGNS. Landlord reserves the right in Landlord's sole discretion to
place and locate on the roof, exterior of the Building, and in any area of the
Building not leased to Tenant such signs, notices, displays and similar items as
Landlord deems appropriate in the proper operation of the Building. Landlord
shall at its sole cost and expense provide signage on the Building directory, in
the lobby, on the floor on which the Premises are located, and a door plate for
Tenant's entry door.
20.12 RULES AND REGULATIONS. Tenant and Tenant's agents, servants,
employees, visitors and licensees shall observe and comply fully and faithfully
with all reasonable and nondiscriminatory rules and regulations adopted by
Landlord for the care, protection, cleanliness and operation of the Building,
and any modification or addition thereto adopted by Landlord, provided Landlord
shall give written notice thereof to Tenant. Landlord shall not be responsible
to Tenant for the non-performance by any other tenant or occupant of the
building of any rule or regulation.
20.13 NOTICE. Any notice required to be given under this Lease shall be
given in writing and shall be delivered in person or by mail, postage prepaid,
and addressed to the following:
If to Landlord:
Robert D. Kaufman and Dale E. Kaufman
P.O. Box 17346
Salt Lake City, Utah 84107
and
Prowswood Management, a division of Prowswood
4885 South 900 East, Suite 101
Salt Lake City, Utah 84117
If to Tenant: (SEND TO BOTH)
1) NETWORK COMPUTER INC.
7050 SOUTH 2000 EAST, SUITE 300
SALT LAKE CITY, UTAH 84121
2) ATTN: FACILITIES MANAGER
NETWORK COMPUTER INC.
1000 BRIDGE PARKWAY
REDWOOD SHORES, CA 94065
Such notice shall be deemed delivered when actually delivered or upon deposit of
the notice in the United States mail.
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20.14. NO PARTNERSHIP. Landlord does not, as a result of entering into
this Lease, in any way or for any purpose become a partner of Tenant in the
conduct of Tenant's business, or otherwise, or joint venturer or a member of a
joint enterprise with Tenant.
20.15 FORCE MAJEURE. In the event that either party hereto shall be
delayed or hindered in or prevented from the performance of any act required
hereunder by reason of strikes, lockouts, 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 the terms of this Lease, then performance of such act
shall be excused for the period of the delay and the period for the performance
of any such act shall be extended for a period equivalent to the period of such
delay. The provisions of this section shall not operate to excuse Tenant from
prompt payment of rent or any other payments required by the terms of this
Lease.
20.16 TENANT AUTHORIZATION. In the event Tenant is a corporation, then
Tenant represents and warrants that this Lease is made and entered into with
full and complete authorization and approval of said corporation's board of
directors. Further, Tenant represents and warrants that the individual signing
and executing this Lease for said corporation is fully authorized and empowered
by said corporation to so sign.
20.17 SPECIAL PROVISIONS. Special Provisions numbered one (1) through N/A
are attached hereto and made a part hereof. If none, so state in the following
space: NONE.
IN WITNESS WHEREOF, Landlord and Tenant have executed this lease the date
and year first above written.
LANDLORD:
ROBERT D. KAUFMAN
---------------------------------
DALE E. KAUFMAN
---------------------------------
TENANT:
NETWORK COMPUTER INC.
---------------------------------
20
EXHIBIT 'A'
DESCRIPTION OF PREMISES
The premises consist of suite known as 300 of the Willowcreek
Medical Building, 7050 South 2000 East; Salt Lake City, Utah, with
a combined leased area of 5,147 rentable square feet.
21
EXHIBIT 'B'
DESCRIPTION OF BUILDING
The following described real property situated in the County of
Salt Lake, State of Utah, more particularly described as follows:
Beginning at a point 53 feet West and 22.09 rods South from the
Northeast corner of Section 28. Township 2 South, Range 1 East,
Salt Lake Base and Meridian, and running thence South 4.25 rods;
thence West 211 feet; thence North 10.894 rods; thence East 211
feet to the West boundary line of Highland Drive extended; thence
South along the West boundary line of Highland Drive extended
6.644 rods to the point of beginning.
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RULES AND REGULATIONS
1. ADVERTISING. Landlord shall have the right to prohibit any advertising
by any Tenant which, in Landlord's reasonable opinion, tends to impair
the reputation of the building or its desirability as a building for
offices, and upon written notice from Landlord, such Tenant shall
refrain from or discontinue such advertising.
2. HALLWAYS AND STAIRWAYS. The sidewalks, passages, elevators, and
stairways shall not be obstructed by any of the Tenants or used by them
for any purpose other than for ingress and egress from their respective
premises. The halls, passages, entrances, elevators, stairways,
balconies, and roof are not for the use of the general public, and
Landlord shall in all cases retain the right of control and prevent
access thereto of all persons whose presence, in the reasonable
judgement of the Landlord, shall be prejudicial to the safety,
character, reputation, and interests of the building and its Tenants,
provided that nothing herein contained shall be construed to prevent
such access to persons with whom Tenants normally deal in the ordinary
course of Tenants' business unless such persons are engaged in illegal
activities. No Tenant and no employee of any Tenant shall go upon the
roof of the building without the written consent of the Landlord.
3. STEREO SYSTEMS, ETC. No Tenant shall install or operate any stereo, loud
speaker system, or similar device in the building in such manner as to
disturb or annoy other tenants of the building or the neighborhood. No
Tenant shall install any antennae, aerial wires, or the equipment
outside the building without the prior written approval of Landlord.
4. WINDOW SHADES. No Tenant will install blinds, shades, awnings, or other
form of inside or outside window covering, or window ventilators or
similar devices without the prior written consent of Landlord.
5. OBSTRUCTING LIGHT, DAMAGE. The sash doors, sashes, windows, glass doors,
lights, and skylights that reflect or admit light into the halls or
other places of the building shall not be covered or obstructed. The
toilets and urinals shall not be used for any purpose other than those
for which they were constructed, and no rubbish, newspapers or other
substance of any kind shall be thrown into them. Waste and excessive or
unusual use of water shall not be allowed. No Tenant shall mark, drive
nails, screw or drill into, paint, or in any way deface the walls,
ceilings, partitions, floors, wood, stone or iron work. The expense of
any breakage, stoppage, or damage resulting from a violation of this
rule by a Tenant shall be borne by such Tenant. Tenants shall be
permitted to hang pictures on the walls of Tenant's offices, but it must
be done in a workmanlike manner and in such a way as not to damage or
deface such walls in an abnormal manner.
6. SIGNS. Except for signs approved by Landlord if provided in this Lease,
no sign, advertisement, notice, or other lettering shall be inscribed,
painted, exhibited, or affixed on or to any part of the outside or
inside of the building.
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7. SAFES, MOVING, FURNITURE, ETC. Landlord shall reasonably prescribe the
weight, size, and position of all safes and other property brought into
the building, and also the times of moving the same in and out of the
building, and all such moving must be done under the supervision of
Landlord. Landlord will not be responsible for any loss of or damage to
any such safe or property from any cause; but all damage done to the
building by moving or maintaining any such safe or property shall be
repaired at the expense of such Tenant. Nor furniture, package, or
merchandise will be received in the building or carried up or down in
the elevators, except between such hours, in such elevators, and in such
a manner as shall be reasonably designated by landlord.
8. WIRING. Electric wiring of every kind shall be introduced and connected
as directed by Landlord and no boring or cutting for wires shall be
allowed except with the prior consent of Landlord. The location of
telephone, call boxes, and similar equipment shall be subject to
approval by Landlord.
9. REQUIREMENTS OF TENANTS. The requirements of Tenants will be attended
to only upon application at the office of Landlord. Landlord's employees
shall not perform any work nor do anything outside of their regular
duties unless under special instruction from the office and shall not
admit any persons (Tenants or otherwise) to any office without
instruction from the office of Landlord.
10. ACCESS TO BUILDING. Landlord reserves the right to close and keep locked
all entrances and exit doors of the building during hours Landlord may
deem advisable for the adequate protection of the property. Use of the
building and the premises before or after normal business hours or at
any time during Saturdays, Sundays, and legal holidays shall be
permissive and subject to the rules and regulations Landlord may
prescribe. Tenants, Tenant's employees, agents or associates, or other
persons entering or leaving the building at any time, when it is so
locked, may be required to sign a building register, and the watchman or
Landlord's agent in charge shall have the right to refuse admittance to
any person into the building without satisfactory identification showing
such person's right to access the building at such time. Landlord
assumes no responsibility and shall not be liable for any loss or damage
resulting from the admission of any authorized or unauthorized person to
the building.
11. IMPROPER CONDUCT. Landlord reserves the right to exclude or expel from
the building any person, including any Tenant, who in the judgement of
Landlord is intoxicated or under the influence of liquor or drugs, or
who shall do any act in violation of the rules and regulations of the
building.
12. STORAGE. No tenant shall conduct any auction or store goods, wares, or
merchandise on the premises. Articles of unreasonable size and weight
shall not be permitted in the building.
13. VEHICLES, ANIMALS, REFUSE. Tenants shall not allow anything to be placed
on the outside window ledges of the premises or to be thrown out of any
outside opening of the building. No bicycles or other vehicles, and no
animal shall be brought into the offices, halls, corridors, elevators
or any other part of the building by Tenants or the
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agents, employees or invitees of Tenants, and Tenants shall not place or
permit to be placed any obstruction of refuse in any public part of the
building.
14. EQUIPMENT DEFECTS. Tenants shall give Landlord prompt notice of any
accidents to or defects in the water pipes, electric lights and
fixtures, heating apparatus, or any other service equipment.
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