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EXHIBIT 10.34
LEASE AGREEMENT
THIS LEASE AGREEMENT is entered into this 7th day of September, 1999
between Cottonwood Land and Farms, Ltd., hereinafter called "Lessor," and Ecrix
Corporation, hereinafter called "Lessee." 1. Introduction. The Lessor has the
legal right to lease the real property and improvements (hereinafter called
"Premises") described in Exhibit "A," which exhibit is attached hereto and
incorporated by reference. The Premises comprise all of 2108 55th Street,
Boulder, Colorado. The parties now desire to enter into an agreement providing
for the Lessee's lease of the Premises, and this document sets forth in writing
the terms of their agreement.
2. Premises, Term of Lease, Rental. The Lessor hereby leases the
Premises to the Lessee, and the Lessee hereby leases the Premises from the
Lessor, for a term commencing at 12:01 A.M. on the 15th day of September, 1999
and ending at 11:59 P.M. on the 31st day of December, 2006 unless sooner
terminated as herein set forth. Occupancy will be phased as described in Exhibit
"C". The Lessee agrees to pay Lessor as rent for the Premises according to the
terms of the RENT SCHEDULE in paragraph 31 of this lease. Said rent is payable,
in advance, by 12:00 noon on the first day of each and every month of the term
hereof at the office of the Lessor.
In the event that the tenancy commences on a date other than the first
day of a month, the rent for the first and last months of the tenancy shall be
prorated and paid on the date of commencement and the first day of the last
month, respectively.
3. Condition of Premises. The Lessor, shall deliver the Premises to
Lessee clean and free of debris on the Lease commencement date (unless the
Lessee is already
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in possession) and the Lessor warrants to the Lessee that the plumbing,
lighting, air-conditioning, and heating in the Premises shall be in good
operating condition on the Lease commencement date. Lessee shall have forty five
(45) days after the Lease commencement date to give Lessor written notice of any
defective condition or "punch-list" items of unfinished or deficient
construction in the Premises, and Lessor shall make reasonable efforts to
correct the same within a reasonable time after such notice. The Lessee's
failure to give such written notice within forty five (45) days after the Lease
commencement date shall cause the conclusive presumption that the Lessor has
complied with all of the Lessor's obligations hereunder. The warranty contained
in this paragraph shall be of no force or effect if, prior to this date, the
Lessee was an occupant of the Premises. Nothing herein shall be deemed to limit
or exclude any rights Lessee may have under contractor warranties or
manufacturer warranties relating to materials or equipment incorporated into the
Premises. Except as otherwise set forth in this paragraph, the Lessee accepts
the Premises in the condition existing as of the Lease commencement date or the
date that the Lessee takes possession of the Premises, whichever is earlier, and
the Lessee hereby waives any and all warranties of condition or habitability,
suitability for occupancy, use, or habitation, merchantability or fitness for a
particular purpose, whether express or implied, relating to the Premises.
4. Use of Premise. Lessee acknowledges that its use of the Premises is
subject to all applicable zoning, municipal, county and state laws, ordinances
and regulations governing and regulating the use of the Premises, and further
subject to any covenants or restrictions of record (a copy of such covenants are
attached as Exhibit "B"
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and incorporated by reference). Lessee covenants and agrees that it will abide
by all such laws, ordinances and regulations and all such covenants and
restrictions of record. Lessee shall have no right to grant utility easements or
rights of way on the Premises or to permit the construction or location on the
Premises of utility equipment or infrastructure without Lessor's prior written
consent. Lessee further agrees that no materials (including toxic chemicals)
other than trash and rubbish in sanitary containers approved by Lessor will be
placed outside the building. No vehicles of any kind will be parked on the
Premises except in the designated parking areas. No vehicles will be parked at
the loading docks other than while being actively loaded or unloaded. No
vehicles, trailers, or other equipment of Lessee or its agents, employees, or
invitees shall be parked overnight on the Premises without the written
permission of Lessor.
5. Assignment. It is expressly understood and agreed by the Lessee that
the Lessee's leasehold interest may not be assigned or sublet in whole or in
part without in each case having first obtained the written consent of the
Lessor. Such consent will not be unreasonably withheld.
6. Access to Premises. It is expressly understood and agreed by the
Lessee that the Lessor or their agents shall have, upon reasonable advance
notice except in the case of an emergency, free access at all reasonable hours
to the Premises for the purpose of examining the same or exhibiting the same to
prospective buyers or lessees or for making repairs on the Premises which the
Lessor may desire to make, or for accessing, servicing or installing utility
equipment, transmission lines, or other infrastructure on the Premises. Lessor
shall have the right to use any and all means that Lessor may
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deem necessary and proper to enter any portion of the Premises in an emergency,
and such entry shall not under any circumstances be construed or deemed to be a
forcible or unlawful entry into, or a detainer of, the Premises or an eviction,
actual or constructive, of the Lessee from the Premises.
7. Alterations. Lesser shall not make any alterations, additions, or
improvements including, but not limited to painting and signs, in or to the
Premises without Lessor's prior written consent, which may be withheld without
cause. Subject to the limitations of this paragraph, if Lessor fails to respond
to a request for alterations, additions, or improvements within five (5)
business days after receiving the materials described below, then Lessor shall
be deemed to have granted its consent. In particular, and not by way of
limitation, Lessee agrees that: (a) Lessee will submit to Lessor all plans for
signs to be erected, substituted, changed or modified on the Premises, including
color, site, location, height, and lighting; (b) No temporary structure, tent,
or trailer shall be constructed or permitted to remain on the Premises; (c) No
apparatus of any kind may be added to the exterior of the building by Lessee;
and (d) No locks may be changed on the Premises without Lessor's consent. Any
alterations, or improvements that the Lessee shall desire to make and which
require the consent of the Lessor shall be presented to the Lessor in written
form with scaled, detailed plans showing modifications of all electrical,
heating, ventilating, air-conditioning, plumbing and other systems as well as
modifications to walls, permanent partitions, doors and other structures, and
the Lessee shall furnish as-built scaled plans upon the completion of the
modifications. Lessee agrees that it shall be
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solely responsible for all costs and expenses incurred in connection with any
alterations, additions, or improvements desired by Lessee, including, without
limitation, the cost of any additional construction, modifications, or
improvements mandated under federal, state, or local law as a result of Lessee's
alterations, additions, or improvements. Notwithstanding anything to the
contrary herein, Lessee shall not be required to obtain Lessor's prior consent
or approval to non-structural, non-mechanical alterations or improvements of
less than $1,000 total aggregate cost in any one year period. Lessee shall not
be required to obtain Lessor's prior consent or approval for phone or data
cabling. If requested by Lessor, Lessee agrees to remove any improvements or
alterations installed under this paragraph.
8. Landlord Not Liable. Lessor shall not be liable for any damages
occasioned by failure to keep the Premises in repair, and shall not be liable
for any damage done or occasioned by or from electrical current, plumbing, gas,
water, steam, or sewage, or the bursting, leaking, running or failure of
operation of any radiator, tank, water closet, wash stand, waste pipe, air
conditioning, or any other apparatus, above, upon, or about the Premises or the
Building, nor the damage occasioned by water, snow, or ice being upon any
sidewalk or entrance way, or being upon or coming through the roof, sky light,
trap door or any other opening in the Premises or the Building, nor from loss
suffered by fire, regardless of origin, wind, rain, flood or other elements, nor
from any damage arising from the action or negligence of Lessee or other
occupants of the Building or of any owners or occupants of its adjacent or
contiguous property, unless the same shall have been caused by Lessor's gross
negligence or willful
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misconduct. Lessee hereby releases, discharges, and agrees to indemnify Lessor
of and from any and all claims, demands, and liability for any loss, damage,
injury, or other casualty to property, whether it be that of either of the
parties hereto or of third persons, whether they be third persons of Lessee or
agents or employees of Lessee, caused by, arising from, or happening in
connection with Lessee's use or occupancy of the Premises or Lessee's use of any
equipment, facilities, or property in, on, or adjacent to the Premises or the
Building, unless the same shall have been caused by Lessor's gross negligence or
willful misconduct. Nothing herein shall be construed as limiting or reducing
Lessor's obligations under paragraph 16 hereof.
9. Additional Areas. It is expressly understood and agreed by Lessee
that if the Lessor shall furnish any automobile parking spaces, common areas, or
any other facilities, equipment or appliances outside of and in addition to the
Lessee's Premises, the same shall be deemed gratuitously furnished by the Lessor
and that if any person shall use the same, such person does so at his or her own
risk and upon the express understanding and stipulation that the Lessor shall
not be liable for any loss of property through theft, casualty, or otherwise, or
for any damage or injury whatsoever to person or property. Maintenance of such
additional areas for normal wear and tear shall be the responsibility of Lessor,
but Lessee agrees to be responsible for any additional damage caused by its
agents, employees, guests or invitees.
10. Additional Rent.
10.1 Utilities. Whenever possible, all utility services to the
leased premises, including, without limitation, gas, electricity,
telecommunications, water, and sewer, shall be contracted directly in the name
of the Lessee, and the Lessee shall be
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solely responsible for the direct payment of all utility fees and service
charges for such utilities. If, for any reason, it is not possible for the
Lessee to contract directly for any utility service, and the cost of such
service is billed to the Lessor, the Lessee shall pay Lessor additional annual
rent equal to the full amount of such utility fees and service charges paid by
Lessor. Where such a utility service is metered by a common meter, the Lessor
shall apportion the total cost among the tenants serviced by such meter, taking
into account the area leased, type of business conducted, and any other factors
deemed relevant by the Lessor. Such apportionment shall be made in the Lessor's
sole, good faith judgment, and shall be final and binding upon Lessee.
10.2 Operating Expenses. In addition, the Lessee shall pay Lessor
additional annual rent equal to the cost of all operating expenses for the
Building multiplied by 100% percent. Operating expenses shall include, but not
be limited to: (a) taxes, assessments and governmental taxes, whether federal,
state, county or municipal, which are levied on or charged against the Premises
and any other taxes and assessments attributable to the Premises and its
operation excluding, however, federal and state income taxes; (b) all insurance
premiums paid by the Lessor attributable to the Premises; (c) all expenses
incurred in connection with the maintenance, operation, and repair of the
Building, associated equipment, adjacent walks, parking areas, and landscaped
areas; (d) Building and cleaning supplies and materials; (e) the cost of all
charges for cleaning, maintenance and service contracts, trash collection, snow
removal, and other services with independent contractors; (f) the reasonable
amortization of any capital improvements which are made or installed by Lessor
after the commencement of this Lease for the purpose of saving labor or
otherwise reducing applicable operating
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expenses; (g) all other costs and expenses reasonably necessary in the operation
and maintenance of a first class Building; (h) the cost of all common area
utility and service charges for the Premises, including, without limitation,
gas, electricity, water, and sewer. Operating costs shall not include the cost
of any work or service performed specially by the Lessor for any lessee at the
cost of such lessee.
10.3 Payment of Additional Rent. Such additional rent shall be paid
at monthly intervals in advance upon receipt of statements of charges and/or
estimated charges from Landlord. At the end of each calendar year, or, at
Lessor's option, at any other more frequent interval, Lessor shall provide an
accounting of the utility fees and service charges for the leased premises paid
by Lessor, if any, total operating expenses for the Building, Lessee's share of
operating expenses, and Lessee's payments toward such amounts during the year or
interval. During the thirty-day period following such accounting, Lessor shall
pay any excess to the Lessee if payments exceed expenses, and the Lessee shall
pay additional rent to Lessor if expenses exceed payments.
11. Personal Property Taxes. The Lessee shall pay and discharge all
personal property taxes which are levied, assessed, imposed or charged upon its
personal property and inventory or which arise out of or result from the
activities carried on by the Lessee at or upon the leased Premises.
12. Insurance. The Lessee shall, at its expense, acquire a general
liability insurance policy effective as of the date of this Lease Agreement.
Said policy shall be acquired from a company qualified and permitted to do
business in the State of Colorado. Said policy shall be in the minimum total
amounts of $1,000,000.00 combined single limits for bodily injury and property
damage. Said policy shall be
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maintained in full force and effect during the entire lease term and shall
contain a provision prohibiting cancellation thereof without at least ten (10)
days' notice to the Lessor, who shall be named as an additional insured. A copy
of the Policy and Current Declaration of coverage shall be provided to the
Lessor within ten (10) days after commencement of the lease and each renewal
date.
The Lessor shall maintain on the Building and other improvements (but
not Lessee's personal property, fixtures, equipment, and tenant improvements) in
which the Premises are located a policy of standard fire and extended coverage
insurance to the extent of at least ninety percent (90%) of full replacement
value. The insurance policy shall be issued in the names of Lessor and Lessor's
lender, as their interest appear, and any proceeds shall be made payable to
Lessor. The cost of such insurance shall be passed on to the Lessee as part of
the operating expenses for the Building.
The parties release each other, and their respective authorized
representatives, from any claims for damages arising out of or incident to the
perils insured against or under the insurance policies carried by the parties
and in force at the time of such damage, whether due to the negligence of Lessor
or Lessee or their agents, employees, or invitees. The parties shall, upon
obtaining the policies of insurance required herein, give notice to the
insurance carrier or carriers that the foregoing mutual waiver of subrogation is
contained in this Agreement.
13. Indemnification. The Lessee agrees to indemnify and hold the Lessor
harmless from any claims, damages, liens, or judgments that may be filed,
entered or asserted against it by virtue of the Lessee's use of the Premises or
by virtue of any act of the Lessee, its agents, servants or employees.
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14. Condemnation. If all or a substantial part of the Premises is taken
or condemned for a public or quasi-public use (or any transfer is made in lieu
thereof), and the part thereof which remains is not suitable for the Lessee's
business use, then this Lease shall, upon written notice from Lessee, terminate
as of the date that title is taken by the condemnor. Lessor shall, after the
taking of all or any portion of the Premises, provide the same amount of square
feet of compatible building space for Lessee's operations in the immediate
vicinity of the Premises, and, in the event Lessor cannot do so, Lessee shall
have the right to terminate this Lease, but shall not receive payment in any
form of compensation. All compensation awarded upon any such condemnation or
taking shall go to the Lessor except that the Lessee shall be entitled to that
part of the total award, if any, specifically allocated to the value of the
Lessee's fixtures so taken.
15. Release of Liens. Lessee expressly covenants and agrees that it
will, during the term hereof, promptly remove or release, by the posting of a
bond or otherwise, as required or permitted by law, any lien attached to or upon
the Premises or any portion thereof by reason of any act or omission on the part
of the Lessee, and it hereby expressly agrees to save and hold harmless the
Lessor from or against any such lien or claim of lien. In the event any such
lien does attach, or any claim of lien is made against the Premises, which may
be occasioned by any act or omission upon the part of the Lessee, and it is not
thus released within thirty (30) days after notice thereof, Lessor, in its sole
discretion, (but nothing herein contained shall be construed as requiring it so
to do) may pay and discharge the said lien and relieve the said demised Premises
from any such lien, and the Lessee agrees to pay and reimburse Lessor upon
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demand for or on account of any expense which may be incurred by Lessor in
connection with such lien of claim, including reasonable attorney's fees. Lessor
covenants and agrees that it will not cause any mechanic's lien or materialman's
lien to attach to or remain a lien against the Premises in a manner that
adversely affects Lessee's rights hereunder.
16. Repair and Maintenance. The Lessor shall be responsible for all
repair, maintenance, and replacements required to maintain and keep the Building
in good condition and shall receive reimbursement of such costs as part of the
operating expenses for the Building; provided, however, that the Lessee shall be
wholly responsible for replacement of cracked or broken glass, replacement of
all incandescent and fluorescent lights and maintenance of all light fixtures on
the Premises and all damage to the Building resulting from acts or omissions of
the Lessee, its agents, employees or invitees. The Lessee shall not be
responsible for maintenance or repair resulting from acts or omissions
(including vandalism) of other tenants, their agents, employees, or invitees.
17. Compliance With Laws and Regulation. The Lessee shall comply with
all laws and regulations of governmental entities, agencies or authorities
having jurisdiction over the Premises and the uses made therein. The Lessee
shall not permit a nuisance to exist on the leased Premises.
18. Payments to Lessor. Until notice to the contrary is given to the
Lessee, all payments to be made to the Lessor hereunder shall be made by
delivering the same
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at the address of the Lessor as set forth in Paragraph 19 hereof so that payment
is received by the Lessor on or before the due date.
19. Notice. Whenever notice is required to be given to a party
hereunder, said notice shall be in writing and shall be given to the party
entitled thereto by delivering a copy thereof to the party entitled thereto or
by mailing a copy thereof to the party entitled thereto by registered or
certified mail, return receipt requested. If such notice is given by delivering
a copy to the person entitled thereto, said notice shall be complete and
effective on the date of such delivery. If such notice is given by mailing a
copy to the person entitled thereto, said notice shall be complete and effective
on the date it is deposited in the mail to the following persons at the
addresses indicated:
Lessor: Cottonwood Land and Farms, Ltd.
c/o Flatiron Park Company
5540 Central Avenue
Boulder, Colorado 80301
Lessee: Ecrix Corporation
5525 Central Avenue
Boulder, Colorado 80301
20. Surrender of Premises. The Lessee shall, upon the termination of
this lease, whether said termination occurs due to the expiration of the lease
term or otherwise, surrender the Premises in as good a condition as when entered
upon, subject only to ordinary wear and tear. Upon the surrender of the
Premises, the Lessee shall, if
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it is not then in default hereunder, have the right to remove its inventory,
furnishings, equipment and trade fixtures from the leased Premises provided that
it repair all damage done to the leased Premises in accomplishing said removal
so as to leave the Premises in the same condition as when entered upon, ordinary
wear and tear excepted.
21. Removal of Lessee's Property. Lessee hereby grants Lessor a
security interest in all its inventory, equipment, furnishings, and trade
fixtures located on the Premises to secure Lessee's obligations hereunder. If
Lessee defaults in any payment obligation of this lease, or if Lessee fails to
remove such property from the Premises within five days after termination of
this lease, or if Lessee abandons the Premises as defined in Paragraph 23, then
Lessor shall have the right and option to remove such property from the Premises
and exercise all rights granted by Article 9 of the Colorado Uniform Commercial
Code, without any liability for damage or injury caused to the property by any
removal, restoration of Premises, or storage, even if Lessor is negligent.
The Lessee shall be responsible for the cost incurred in said removal,
storage and restoration, including any reasonable attorney's fees. The Lessor
shall give notice of removal to the Lessee in the manner provided for in this
agreement and the Lessee shall have three (3) days after the effective date of
such notice to recover such property by paying all monies owed and fulfilling
all other obligations hereunder. If the Lessee does not take such actions,
Lessor may retain such property as its sole and separate property or may sell
such property in any commercially reasonable fashion and apply the proceeds to
Lessee's obligations hereunder.
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Lessor hereby subordinates its lien pursuant to this paragraph to any
existing or future UCC lien relating to bank or institutional financing
(including equipment leases) granted by Lessee in the ordinary course of its
business.
22. Premises Damages or Destroyed. In the event the Premises are
damaged or rendered wholly or partially unusable by fire, flood, windstorm,
explosion or any other casualty, then the rights and obligations of the parties
shall be as follows:
Lessor shall promptly repair or replace the damaged Premises, and if
reasonably possible the repair or replacement shall be completed within 90 days
from date of the damage (plus any time period required to obtain City of Boulder
permits and approvals). In the event the repairs or replacements are not
completed within such time period, the Lessee may at its option terminate this
lease, and all the Lessee's obligation for further rent payments shall cease as
of the date of said termination. Rent shall not be abated unless more than 10
percent of the interior floor space in the Premises is rendered untenantable and
the total repairs are not completed in 30 days, in which event there shall be an
abatement of rent in proportion to the portion of the interior floor space
rendered untenantable. In no event shall there be an abatement of rent if the
damage is caused by any casualty on the Premises as a result of acts or
omissions of the Lessee.
The parties recognize that the Lessee on most occasions will be storing
valuable materials and equipment within the Premises. In the event the Premises
are so damaged by such casualty that Lessee's property would be endangered by
exposure to the elements, and in the further event that Lessee desires to
complete emergency repairs, the restoration of any alterations to the Premises
occasioned by emergency repairs shall
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also be borne by the Lessee. Lessor shall have no obligation to make such
emergency repairs nor any liability for damage directly or indirectly caused to
Lessee's property by such casualty.
23. Default and Abandonment. If the Lessee defaults in any of its
obligations hereunder and fails to correct said default within three days after
written notice thereof from the Lessor, or, if such breach is not in payment of
money, has not within said three-day period of time commenced substantial
efforts to cure said breach and thereafter continued its efforts to cure said
breach with due diligence, then the Lessor shall have the right to declare this
agreement terminated and to re-enter and take immediate possession of the
demised Premises, or, without in any way being obligated so to do, the Lessor
may elect to retake possession of said Premises and rent the same for such rent
and pursuant to such conditions as the Lessor believes best, making such changes
and repairs as may be required, and giving credit for the amount of rent so
received less all expenses for reletting, advertising, cleaning, removal or
storage of Lessee's property, and repairs, and in such event, said Lessee shall
be liable for the balance of the rent herein reserved until the expiration of
the term of this lease.
The Lessee shall pay unto the Lessor additional rent for late rent
payments as to all rental payments not made on or before the fifth (5th) day of
the month in which they are due, said additional rent to be five percent (5%) of
the rent payment so delinquent for each month or fraction, thereof that such
payment is late. The parties agree that this late charge is reasonable
liquidated damages taking into account the time spent by Lessor, its agents and
employees because of such late rent payments, processing and
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accounting charges, and late charges that may be imposed on Lessor under the
trust deed covering the Premises.
In the event of a default by the Lessee in the performance of any of
its duties and obligations hereunder, the Lessee shall pay all costs incurred by
the Lessor in the enforcement of the provisions of this lease (including this
provision) as against said Lessee, said costs to include reasonable attorneys'
fees whether or not litigation is commenced.
24. Holding Over. If Lessee remains in possession of the Premises after
the expiration of this lease and without the execution of a new lease, it shall
be deemed to be occupying said Premises as Lessee from month to month at a rent
equal to two times the monthly rental being paid by it at the time of said
expiration of lease.
25. Bankruptcy. If at any time during the term hereof the Lessee shall
file a voluntary petition in Bankruptcy, or if an involuntary petition in
Bankruptcy shall be filed against Lessee if the same shall not be dismissed
within thirty (30) days, or if the Lessee makes an assignment for the benefit of
creditors, or if a receiver shall be appointed for Lessee, then the Lessor may,
at its option, in any of such events, immediately take possession of the demised
Premises and terminate this lease. Upon such termination, all installments of
rent earned to the date of termination and unpaid shall at once become due and
payable, and in addition thereto Lessor shall have all rights provided by the
Bankruptcy Code relative to the proof of claims on an anticipatory breach on an
executory contract.
26. Rent Regulations. If the rent to be paid by the Lessee to the
Lessor hereunder, whether pursuant to Paragraph 2 or Paragraph 24, is subject to
regulation by
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law, then the rent to be so paid shall be the maximum rental permitted by said
laws but in no event in excess of the rent provided for or determined in
accordance with the applicable provisions of this Lease Agreement.
27. Meaning of Words. Unless the context clearly indicates a contrary
intention, all words used herein in one gender shall extend to and include the
other gender; all words in the singular number shall extend to and include the
plural; and all words used in the plural number shall extend to and include the
singular.
28. Remedies Not Exclusive. It is agreed that each and every one of the
rights, remedies and benefits provided by this lease shall be cumulative, and
shall not be exclusive of any other of said rights, remedies and benefits, or of
any other rights, remedies and benefits allowed by law.
29. Waiver. One or more waivers of any covenant or condition by the
Lessor shall not be construed as a waiver of a further breach of the same.
30. Lease Binding. The covenants, conditions and agreements contained
in this lease shall bind and inure to the benefit of the Lessor and Lessee and
their respective heirs, personal representatives and successors, and except as
otherwise provided in this lease, their assigns.
31. Rent Schedule.
September 15, 1999 through September 30, 1999 $4,407.00 per month
October 1, 1999 through October 31, 1999 $8,263.00 per month
November 1, 1999 through November 30, 1999 $14,901.00 per month
December 1, 1999 through December 31, 1999 $17,314.00 per month
January 1, 2000 through December 31, 2000 $36,366.00 per month
January 1, 2001 through December 31, 2001 $38,184.00 per month
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January 1, 2002 through December 31, 2002 $40,094.00 per month
January 1, 2003 through December 31, 2003 $42,098.00 per month
January 1, 2004 through December 31, 2004 $44,203.00 per month
January 1, 2005 through December 31, 2005 $46,413.00 per month
January 1, 2006 through December 31, 2006 $48,734.00 per month
32. Quiet Enjoyment. Subject to the terms and conditions of this lease,
Lessor covenants that so long as the rental is current for the demised Premises
and there is no default in any of the covenants to be performed by Lessee, the
Lessee shall peaceably and quietly hold and enjoy the demised Premises for the
entire term of this lease and any renewals thereof.
33. Subordination. This lease is and shall be subordinate to any
encumbrance now of record or recorded after the date of this lease affecting the
Premises. Such subordination is effective without any further act of Lessee.
Lessee shall from time to time on request from Lessor execute and deliver any
documents that may be required by a lender to effectuate any subordination. If
Lessee fails to execute and deliver such documents within fifteen (15) days
after written request by Lessor, Lessee irrevocably constitutes and appoints
Lessor as Lessee's special attorney-in-fact to execute and deliver such
documents on Lessee's behalf.
34. Security Deposit. Upon occupancy of the Premises, Lessee shall
deposit with Lessor $36,366.00, to be held by Lessor without liability for
interest, as a security deposit for the performance by Lessee of all its
obligations under this lease. If Lessee is in default, Lessor can use the
security deposit, or any portion of it, to cure the default or to compensate
Lessor for all damage sustained by Lessor resulting from Lessee's default.
Lessee shall immediately on demand pay such amount to Lessor as is necessary
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to restore the security deposit to the amount set forth above. At the expiration
or termination of this lease, Lessor shall return to Lessee that portion of the
security deposit remaining after application of such amounts as are necessary to
compensate Lessor for Lessee's defaults, if any.
35. Additional Rent and Interest. Any monetary obligations of Lessee to
Lessor under the terms of this lease shall be deemed to be rent. Any amount due
to Lessor under any of the provisions of this lease shall bear interest from the
date due at fifteen (15%) percent per annum, provided, however, that interest
shall not be payable on late charges nor any amounts upon which late charges are
paid. Payment of such interest shall not cure or excuse any default by Lessee.
36. Severability. The invalidity of any provision of this Lease as
determined by a court of competent jurisdiction shall in no way affect the
validity of any other provision hereof.
37. Prohibition on Animals. Lessee, its employees, authorized
representatives, and invitees shall not permit any access to or use of the
Premises or any part of the Premises by any animals, whether domestic or
agricultural, other than qualified "service" animals used by persons with
disabilities covered by the Americans with Disabilities Act or any similar law.
Any such use shall constitute a default under this lease, and Lessee shall be
fully responsible for any damages caused thereby.
38. Environmental Matters.
38.1 Definitions.
38.1.1 Hazardous Material. Hazardous Material means any substance:
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(a) which is or becomes defined as a "hazardous material,"
"hazardous waste," "hazardous substance," "regulated substance," pollutant or
contaminant under any federal, state or local statute, regulation, rule, order,
or ordinance or amendments thereto; or
(b) the presence of which on the Premises causes or
threatens to cause a nuisance upon the Premises or to adjacent properties or
poses or threatens to pose a hazard to the health or safety of persons on or
about the Premises or requires investigation or remediation under any federal,
state or local statute, regulation, rule, order, or ordinance or amendments
thereto.
38.1.2 Environmental Requirements. Environmental Requirements
means all applicable present and future statutes, regulations, rules,
ordinances, codes, licenses, permits, orders, approvals, plans, authorization,
concessions, franchises, and similar items, of all governmental agencies,
departments, commissions, boards, bureaus, or instrumentalities, of the United
States, states and political subdivisions thereof and all applicable judicial,
administrative, and regulatory decrees, judgments, and orders relating to the
protection of human health or the environment.
38.1.3 Environmental Damages. Environmental Damages means all
claims, judgments, injuries, damages (including without limitation damages for
diminution in the value of the Premises and adjoining property and for the loss
of business from the Premises and adjoining property), losses, penalties, fines,
liabilities (including strict liability), encumbrances, liens, costs, and
expenses of investigation and defense of any claim, and of any good faith
settlement of judgment, of whatever kind or nature, contingent or otherwise,
matured or unmatured, foreseeable or unforeseeable,
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including without limitation reasonable attorneys' fees and disbursements and
consultants' fees, any of which are incurred at any time as a result of the
existence of "Hazardous Material" upon, about, beneath the Premises or migrating
or threatening to migrate to or from the Premises or the existence of a
violation of "Environmental Requirements" pertaining to the Premises.
38.2 Obligation To Indemnify, Defend And Hold Harmless.
38.2.1 Lessee, its successors, assigns and guarantors, agree to
indemnify, defend, reimburse and hold harmless the following persons from and
against any and all "Environmental Damages" arising from activities of Lessee or
its employees, agents, or invitees which (a) result in the presence of
"Hazardous Materials" upon, about or beneath the Premises or migrating to or
from the Premises, or (b) result in the violation of any "Environmental
Requirements" pertaining to the Premises and the activities thereon:
(i) Lessor;
(ii) any other person who acquires a portion of the
Premises in any manner, including but not limited to through purchase, at a
foreclosure sale or otherwise through the exercise of the rights and remedies of
Lessor under this Agreement; and
(iii) the directors, officers, shareholders, employees,
partners, agents, contractors, subcontractors, experts, licensees, affiliates,
lessees, mortgagees, trustees, heirs, devisees, successors, assigns and invitees
of such persons.
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38.2.2 This obligation shall include, but not be limited to, the
burden and expense of defending all claims, suits and administrative proceedings
(with counsel reasonably approved by the indemnified parties), and conducting
all negotiations of any description, and paying and discharging, when and as the
same become due, any and all judgments, penalties or other sums due against such
indemnified persons. Lessee, at its sole expense, may employ additional counsel
of its choice to associate with counsel representing Lessor.
38.2.3 The obligations of Lessee in this section shall survive the
expiration or termination of this Lease.
38.3 Notification.
38.3.1 If Lessee shall become aware of or receive notice or other
communication concerning any actual, alleged, suspected or threatened violation
of "Environmental Requirements," or liability of Lessee for "Environmental
Damages" in connection with the Premises or past or present activities of any
person thereon, or that any representation set forth in this Agreement is not or
is no longer accurate, then Lessee shall deliver to Lessor, within ten days of
the receipt of such notice, or communication or correcting information by
Lessee, a written description of such information or condition, together with
copies of any documents evidencing same.
38.4 Negative Covenants.
38.4.1 No Hazardous Material on Premises. Except in strict
compliance with all Environmental Requirements, Lessee shall not cause, permit
or suffer any "Hazardous Material" to be brought upon, treated, kept, stored,
disposed of, discharged, released, produced, manufactured, generated, refined or
used upon, about or
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beneath the Premises or any portion thereof by Lessee, its agents, employees,
contractors, tenants or invitees, on any other person without prior written
consent of Lessor.
38.4.2 No Violations of Environmental Requirements. Lessee shall
not cause, permit or suffer the existence or the commission by Lessee, its
agents, employees, contractors, or invitees, or by any other person of a
violation of any "Environmental Requirements" upon, about or beneath the
Premises or any portion thereof.
38.5 Right To Inspect.
38.5.1 Lessor shall have the right in its sole and absolute
discretion, but not the duty, to enter and conduct an inspection of the Premises
at any reasonable time to determine whether Lessee is complying with the terms
of this Agreement, including but not limited to the compliance of the Premises
and the activities thereon with "Environmental Requirements" and the existence
of "Environmental Damages." Lessee hereby grants to Lessor the right to enter
the Premises and to perform such tests on the Premises as are reasonably
necessary in the opinion of Lessor to conduct such reviews and investigations.
Lessor shall use its best efforts to minimize interference with the business of
Lessee but Lessor shall not be liable for any interference caused thereby.
38.6 Right To Remediate.
38.6.1 Should Lessee fail to perform or observe any of its
obligations or agreements pertaining to "Hazardous Materials" or "Environmental
Requirements," then Lessor shall have the right, but not the duty, without
limitation
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upon any of the rights of Lessor pursuant to this Agreement, to enter the
Premises personally or through its agents, consultants or contractors and
perform the same. Lessee agrees to indemnify Lessor for the costs thereof and
liabilities therefrom as set forth in Section 38.2.
39. Monitoring Equipment. Should equipment for monitoring fire systems
and/or security systems be deemed necessary by the Lessee or be required for the
Premises by Federal, State, or Local Governing Agencies because of Lessee's
equipment, the nature of Lessee's business, or Lessee's modification of the
Premises, Lessee shall be responsible for installation of such monitoring
system, for any required building permits, and monthly monitoring fees. Should
such monitoring systems be otherwise required by Federal, State, or Local
Governing Agencies, Lessor shall be responsible for installation of such
monitoring systems, but Lessee shall pay for monthly monitoring fees as
additional rent.
40. Force Majeure. In the event that Lessor shall be delayed or
hindered in, or prevented from, the performance of any act required hereunder by
reason of strikes, lock-outs, labor troubles, inability to procure materials,
the inability to obtain building inspections, approvals, or permits, stop work
orders, the inability to obtain a certificate of occupancy, failure of power or
unavailability of utilities, riots, insurrection, war or other reason of like
nature not the fault of Lessor or not within its control, the performance of
such acts shall be excused for the period of delay, and the period for the
performance of any such act shall be extended for a period equivalent to the
period of such delay (including extension of both the commencement and
termination dates of this Lease); provided, however, that if Lessee is not in
any way responsible for the delay
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and does not have use or occupancy of the Premises during the period of delay,
the rent payable hereunder shall be abated for such period of delay.
Other 41. The occupancy dates described in Exhibit "C", for this Lease,
are contingent upon successfully obtaining timely building permits from the City
of Boulder and the execution of this Lease Agreement by September 8, 1999. In
the event that Lessor is unable to obtain timely permits by the City of Boulder
to meet occupancy dates outlined in Exhibit "C, it is agreed that this Lease
shall be modified by changing the occupancy dates and rent schedules to reflect
a new commencement date accounting for the resulting delay, for each phase of
occupancy. All other terms of the Lease shall remain in full force and effect.
Tenant Improvements and occupancy dates for each phase of work are
described in the attached "Exhibit C."
It is agreed that Lessor will amortize $291,900.00 over the term of the
lease for tenant improvements to the Premises, in the form of a separate
Promissory Note, and Lessee agrees to make payments per the Promissory Note.
This amount will be billed with the rent invoice each month and shall be
considered due and payable by the 1st of each month. The monthly amount due for
amortized tenant improvements will be $4,623.00 per month. Any default by Lessee
under the Promissory Note shall also be a default under this Lease.
Additionally, Lessee agrees to pay directly $200,000.00 to Quinlan Construction
for addition tenant improvements requested by Lessee, on terms and conditions
agreeable to Lessee and Quinlan Construction.
Lessee understands that Lessor intends to add an addition to the
existing facility, sometime in the next twenty four months. Lessee agrees to
provide Lessor access to the
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Premises from time to time, as necessary, during normal business hours with
reasonable notice to perform task associated with the construction of the
addition. Lessor understands Lessee is running a business and will take
reasonable precautions to prevent interruption to Lessee's day to day business
routine.
This agreement does not include the payment of any broker commissions
and Lessor will not pay any commission in connection with this Lease. All real
estate and or broker commissions, if any, shall be the responsibility of Lessee.
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IN WITNESS WHEREOF, the parties have hereunto set their hands and seals
this date and year above written.
LESSOR: Cottonwood Land and Farms, Ltd.
BY: /s/ Richard L. Hedge
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LESSEE: Ecrix Corporation
BY: /s/ Craig G. Lamborn
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ITS: V.P. Finance
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EXHIBIT 10.34
The Registrant hereby agrees to furnish supplementally a copy of the following
omitted Attachments and Exhibits:
Attachment Notary Public signatures
Exhibit A Floor Plans
Exhibit B Declaration of Protective Covenants
Exhibit C Occupancy Schedule