SUBLEASE AGREEMENT
SUBLESSOR:
XXXXX FARGO BANK, N.A.,
A NATIONAL BANKING ASSOCIATION
SUBLESSEE:
GREASE MONKEY INTERNATIONAL, INC.,
A COLORADO CORPORATION
PREMISES LOCATED AT:
000 00XX XXXXXX
XXXXXX, XXXXXXXX
SUBLEASE AGREEMENT
THIS SUBLEASE AGREEMENT (this "Sublease") is made and entered
into as of the 10th day of April, 1998, by and between XXXXX FARGO BANK,
N.A., a national banking association ("Sublessor"), and GREASE MONKEY
INTERNATIONAL, a Colorado corporation ("Sublessee").
RECITALS
A. Sublessor is presently the lessee of certain office
premises (the "Master Premises") consisting of the basement and the first
through twelfth floors of that certain office building commonly known as 000
00xx Xxxxxx, Xxxxxx, Xxxxxxxx (the "Building") pursuant to an Indenture of
Lease dated as of January 25, 1973 (the "Original Lease"), between
U.I.D.C.-Denver, Inc. ("UIDC"), as landlord, and The First National Bank of
Denver ("FNB"), as tenant. The Original Lease was amended by instruments
dated as of July 15, 1974, January 1, 1975, April 21, 1978, April 10, 1981,
November 30, 1981, January 1, 1985, May 1, 1985 and February 3, 1987, and as
so amended is hereinafter referred to as the "Master Lease"). Prudential
Insurance Company of America ("Master Lessor") has succeeded to the interests
of UIDC as the landlord under the Master Lease, and Sublessor has succeeded
to the interests of FNB as the tenant under the Master Lease.
B. Sublessor desires to sublease a portion of the Master
Premises (the "Sublease Premises") to Sublessee, and Sublessee desires to
sublease the Sublease Premises from Sublessor, pursuant to the terms,
covenants and conditions set forth below.
C. Except as expressly set forth below, all capitalized
terms used below without definition shall be as defined in the Basic Sublease
Information contained in Article 1 below.
AGREEMENT
NOW, THEREFORE, FOR GOOD AND VALUABLE CONSIDERATION, the
receipt and sufficiency of which are hereby acknowledged, and intending to be
legally bound hereby, the parties hereby agree as follows:
1. BASIC SUBLEASE INFORMATION. The information set
forth in this Section (the "Basic Sublease Information") is intended to
supplement or summarize the provisions set forth in the balance of this
Sublease. Each reference in this Sublease to any of the terms set forth
below shall mean the respective information set forth next to such term as
amplified, construed or supplemented by any particular section of the
Sublease pertaining to such information. In the event of a conflict between
the provisions of this Section and the balance of the Sublease, the balance
of the Sublease shall control.
Sublessor: XXXXX FARGO BANK, N.A., a national banking association
Sublessor's Xxxxx Fargo Bank, N.A.
Address: Corporate Properties Group
000 Xxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attn: Lease Administration
with copy to:
Xxxxx Fargo Bank, N.A.
Corporate Properties Group
000 Xxxxx Xxxxx Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attn: Manager
Sublessee: GREASE MONKEY INTERNATIONAL, INC., a Colorado corporation
Sublessee's
Tax ID No.: 00-0000000
Sublessee's Prior to the Commencement Date:
Address:
Grease Monkey International, Inc.
000 Xxxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxxxxx 00000
Attn: Xxxx Xxxxx
Following the Commencement Date:
Grease Monkey International, Inc.
000 00xx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxx 00000
Attn: Xxxx Xxxxx
Sublease
Premises: That portion of the Master Premises consisting of the entire
fourth floor of the Building, comprising approximately 17,907
square feet of "Rentable Area" (as hereinafter defined), as
delineated on EXHIBIT A attached hereto. The actual rentable
square footage ("Rentable Area") of the Sublease Premises shall
be determined based on the approved "Space Plan" (as defined in
the "Work Letter") in accordance with the Standard Method for
Measuring Floor Area in Office Buildings, ANSI Z65.1-1996, as
promulgated by the Building Owners and Managers Association
(BOMA) International for calculating rentable area in office
buildings
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Permitted
Use: Business and professional offices consistent with the character
of the Building as a "Class-A" office building
Monthly
Base Rent: The Monthly Base Rent shall be as set forth in Section 5.2 of
this Sublease.
Security
Deposit: $55,000.00, payable contemporaneously with the execution of this
Sublease by Sublessee
Sublessee's
Share: 8.27%, representing the ratio that the Rentable Area of the
Sublease Premises bears to the Rentable Area of the Master
Premises
Term: Approximately ten years and four months, commencing as of the
Commencement Date and expiring, unless earlier terminated in
accordance with the terms of this Sublease, on the Expiration
Date
Commence-
ment Date: The latter of June 27, 1998 or upon tender of possession of the
Sublease Premises to Sublessee in accordance with the "Work
Letter" (as hereinafter defined)
Expiration
Date: The last day of the calendar month in which the day which is ten
years and four months after the Commencement Date occurs
2. SUBLEASE.
2.1 PREMISES. Sublessor hereby subleases to
Sublessee, and Sublessee hereby subleases from Sublessor, the Sublease
Premises upon all of the terms, covenants and conditions in this
Sublease.
2.2 SUBLEASE SUBJECT TO MASTER LEASE. This Sublease
is and shall be at all times subject to all of the terms, covenants and
conditions of the Master Lease, attached hereto as EXHIBIT B, and shall
in all respects be limited to the estate granted to Sublessor by Master
Lessor pursuant to the Master Lease. Excluding only the obligations
with regard to the payment of basic rental and excluding any rights, if
applicable, with regard to extension options, expansion options, options
to purchase, or rights of first refusal contained in the Master Lease,
Sublessee assumes and agrees to be bound by the terms of and to perform
all of the obligations and duties of Sublessor under the Master Lease
with respect to the Sublease Premises, as if Sublessee were the tenant
named thereunder. Sublessee shall not commit or permit to be committed
any act or omission which shall violate any terms, covenants or
conditions of the Master Lease. Sublessee agrees that it shall promptly
forward to Sublessor any and all notices or other communications
received by Sublessee from the Master Lessor under the Master Lease.
Sublessee acknowledges that Sublessor has no duty or obligation to
Sublessee under the
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Master Lease other than to maintain the Master Lease in full force
and effect during the Term of this Sublease. In the event that the
Master Lease shall terminate for any reason prior to the Expiration
Date of this Sublease through no fault of Sublessor, this Sublease
shall also terminate and the parties hereunder shall have no further
obligations or liabilities to each other; provided that any such
termination shall not impair the rights of Sublessor under Section 17
hereof. Where any approval or consent shall be required of Master
Lessor pursuant to the provisions of the Master Lease, Sublessor may,
without limitation, condition its approval or consent upon
Sublessee's obtaining the approval or consent of the Master Lessor.
To the extent that the terms of this Sublease are more restrictive
than the terms of the Master Lease, the terms of this Sublease shall
prevail.
2.3 DELIVERY OF POSSESSION. The parties contemplate
that the Sublease Premises shall be remodeled and improved as set forth
in the Work Letter (the "Work Letter") attached hereto as EXHIBIT C.
Sublessor shall deliver the Sublease Premises to Sublessee upon
substantial completion of the Improvements, as defined in, and in the
manner required by, the Work Letter. Upon delivery of possession, the
Sublease Premises shall be in broom clean condition and, except for the
Improvements, in substantially the same condition as the Sublease
Premises are in as of the date of this Sublease, reasonable wear and
tear excepted. Sublessor shall use commercially reasonable efforts to
complete the Improvements on or before June 27, 1998; provided, that in
no event shall failure by Sublessor to complete the Improvements and
deliver the Sublease Premises to Sublessee by such date result in
termination of this Sublease or liability to Sublessor. Notwithstanding
anything to the contrary herein, if Sublessor fails to deliver the
Sublease Premises to Sublessee on or before September 1, 1998 (which
date shall be extended by any period of delay caused by an event of
"Force Majeure" (as hereinafter defined) or the acts or omissions of
Sublessee), Sublessee may by 30 days advance written notice to Sublessor
terminate this Sublease, provided that if Sublessor shall tender
possession of the Sublease Premises to Sublessee within such 30-day
period, such termination notice shall not be effective and this Sublease
shall not terminate. In the event of any such termination, this
Sublease shall be of no force or effect and the parties shall have no
further rights, obligations or liabilities to each other with regard to
the subject matter hereof.
2.4 PARKING. So long as no "Event of Default" (as
hereinafter defined) exists, Sublessee shall have the non-exclusive
right to rent and use, on a monthly basis, up to one parking space in
the parking facility serving the Building commonly known as the "Plaza
Parking Garage" (the "Garage") for every 1,000 square feet of Rentable
Area within the Sublease Premises. In addition, Sublessee shall have
the non-exclusive right to use in common with other tenants of the
Building on an "as-available" basis short-term or daily parking spaces
within the Garage. Sublessee's right to use such parking spaces shall
be subject to all rules and regulations applicable thereto from time to
time imposed by Master Lessor or any third party operator of the Garage,
including, without limitation, payment of parking rent and other fees
assessed for the use of such parking spaces.
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3. CONDITION OF SUBLEASE PREMISES.
3.1 DUE DILIGENCE INVESTIGATION. As of the date of
this Sublease, Sublessee acknowledges that Sublessee has conducted or
has had the opportunity to conduct a comprehensive investigation ("Due
Diligence Investigation") of the Sublease Premises and all other matters
which in Sublessee's judgment may affect the value or suitability of the
Sublease Premises for Sublessee's purposes or which may influence
Sublessee's willingness to enter this Sublease, including, without
limitation, an inspection or examination of (i) the physical condition,
size and configuration of the Sublease Premises, including access,
parking, location or accessibility of utilities, the condition of the
improvements, or the existence of any hazardous materials; (ii) the
Master Lease; (iii) title; (iv) taxes, (v) income and expense data, (vi)
insurance costs, (vii) permissible uses and zoning or development
entitlements; (viii) any applicable covenants, conditions and
restrictions; and (ix) compliance with any federal, state or local law,
statute, rule or regulation now or hereafter in effect, including,
without limitation, the Americans With Disabilities Act of 1990, 42
U.S.C. Section 12101 (the "ADA").
3.2 REPRESENTATIONS AND WARRANTIES; DISCLAIMER.
Sublessor represents and warrants to Sublessee that: (i) to the best of
Sublessor's knowledge, without investigation, there are no hazardous
substances present upon the Sublease Premises in violation of any
applicable law or regulation; and (ii) upon completion of the Base
Building Improvements (as defined in the Work Letter), the Sublease
Premises will, to the best of Sublessor's knowledge, comply with all
applicable requirements of the ADA. Sublessee acknowledges that
Sublessor would not sublease the Sublease Premises except on an "AS-IS"
basis, and agrees that (i) subject to completion of the Improvements,
Sublessee accepts the Sublease Premises "AS-IS" and with all faults;
(ii) except as expressly set forth in this Section 3.2, neither
Sublessor nor any of its officers, agents, employees or representatives
has made any representations or warranties of any kind or nature,
whether express or implied, with respect to the Sublease Premises or any
of the matters relating thereto (including without limitation the
matters referred to in Section 3.1 above); (iii) Sublessor has no duty
to make any disclosures concerning the condition of the Sublease
Premises and/or the fitness of the Sublease Premises for Sublessee's
intended use, and Sublessee expressly waives any duty which Sublessor
might have to make any such disclosures; (iv) Sublessee is relying
solely on Sublessee's own Due Diligence Investigation; (v) neither
Sublessor nor Master Lessor (except as expressly provided in the Master
Lease) shall be required to perform any work of construction,
alteration, repair or maintenance of or to the Sublease Premises, except
as expressly provided in the Work Letter; and (vi) in the event
Sublessee subleases all or any portion of the Sublease Premises or
assigns its interest in this Sublease, Sublessee shall indemnify and
defend Sublessor (in accordance with Section 17 below) for, from and
against any matters which arise as a result of Sublessee's failure to
disclose any relevant information about the Sublease Premises to any
subtenant or assignee of Sublessee. If Sublessor obtains or has
obtained or provides to Sublessee any services, opinions, or work
product of surveyors, architects, soil engineers, environmental
auditors, engineers, title insurance companies, governmental authorities
or any other person or entity with respect to the Sublease Premises,
Sublessee and Sublessor agree that
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Sublessor does so only for the convenience of the parties, Sublessor
does not vouch for the accuracy or completeness of any such items and
the reliance of Sublessee upon any such items shall not create or
give rise to any liability of or against Sublessor.
3.3 RELEASE. Except as to the representations and
warranties expressly set forth in this Article 3, Sublessee hereby fully
releases and discharges Sublessor, and its officers, directors,
employees and agents, from and relinquishes all rights, claims and
actions that Sublessee may have against Sublessor, or its officers,
directors, employees or agents which arise out of or are in any way
connected with the condition of the Sublease Premises and the matters
addressed in this Article 3, including but not limited to the matters
referred to in Section 3.1 above. This release applies to all described
rights, claims, and actions, whether known or unknown, foreseen or
unforeseen, present or future.
4. TERM.
4.1 TERM. All obligations of Sublessee hereunder
shall commence on the Commencement Date. Promptly after the
Commencement Date, Sublessor shall deliver to Sublessee written notice
of such date. Within ten days after Sublessee's receipt of such written
notice, Sublessee shall either confirm or object to such date in
writing. If Sublessee should fail to respond to such written notice
within the time prescribed, Sublessee shall be deemed to have confirmed
that the date set forth in such notice is the Commencement Date.
4.2 OPTION TO EXTEND THE TERM. Sublessee shall have
the option to extend the Term for an additional term ending on June 30,
2011 (the "Extended Term") upon the same terms, covenants and conditions
set forth in this Sublease, except that the minimum Monthly Base Rent
for the Extended Term shall be an amount equal to the greater of (i) the
Monthly Base Rent for year 9 through the end of the Term, or (ii) an
amount equal to ninety-five percent (95%) of the Fair Rental Value (as
defined in Section 5.2 below) of the Sublease Premises as of the date on
which Sublessee delivers the "Exercise Notice" (as hereinafter defined).
Sublessee's option to extend the Term may be exercised only by delivery
to Sublessor of written notice (the "Exercise Notice") of such exercise
by Sublessee no earlier than one year and no later than six months prior
to the expiration of the initial Term. Notwithstanding the above,
Sublessee's right to extend the Term shall be conditioned upon Sublessee
not being (i) in default (whether or not subsequently cured) under the
Sublease more than one time per year during the Term; or (ii) in default
either at the time of Sublessee's exercise of the option or at the time
of the commencement of the Extended Term. In the event of any such
default or any purported exercise of the option to extend the Sublease
delivered prior to one year or later than six months before the
expiration of the Term, such purported exercise shall be null and void
and the term of this Sublease shall expire at the end of the Term. Fair
Rental Value shall be determined in accordance with the procedures of
Section 5.3 of this Sublease, with the thirty-day period referred to in
subsection 5.3.1. commencing on the date of the Exercise Notice.
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4.3 SURRENDER. Upon the expiration or earlier
termination of the Term of this Sublease, Sublessee shall surrender the
Sublease Premises, together with any personal property therein belonging
to Sublessor, and any Alterations (as defined in Section 11 below) made
thereto (other than any such Alterations which Sublessee is required to
remove as set forth in Section 11 below), broom clean and free of
debris, and in good working order, repair and condition, except for
reasonable wear and tear. All furniture, trade fixtures and other
personal property of Sublessee shall be removed from the Sublease
Premises on or before such expiration or earlier termination, if such
removal can be undertaken without material damage to the Sublease
Premises, and Sublessee shall immediately repair any damage resulting
from such removal. In no event shall the heating, ventilating and air
conditioning equipment (the "HVAC equipment"), plumbing or sprinkler
system components, air lines, power panels, electrical distribution
systems, lighting fixtures, fencing or any other component from any
major building system be removed from the Sublease Premises.
4.4 HOLDING OVER. Subject to the terms of the
Master Lease, if Sublessee shall, with Sublessor's written consent,
remain in possession of the Sublease Premises or any part thereof after
the expiration of the Term hereof, such occupancy shall constitute a
tenancy from month to month, terminable upon 30 days notice by either
party, upon all of the terms, covenants and conditions of this Sublease,
except that the Monthly Base Rent shall be increased to 150% of the
amount last due under this Sublease. Otherwise, any such occupancy
shall constitute a tenancy at sufferance, and Sublessee shall be liable
to Sublessor for any and all claims, damages, liabilities, costs and
expenses (including attorneys' fees and expenses) incurred by Sublessor
and arising out of Sublessee's failure to timely surrender the Sublease
Premises in accordance with the requirements of this Sublease.
5. RENT.
5.1 DEFINITION. As used in this Sublease, the term
"Rent" shall include: (i) the Monthly Base Rent; and (ii) all other
amounts which Sublessee is obligated to pay under the terms of this
Sublease.
5.2 MONTHLY BASE RENT. The Monthly Base Rent for
each month of the first five years of the Sublease Term shall be as set
forth in the table below, in each case based on the annual rate per
square foot of Rentable Area set forth in the table below multiplied by
the estimated number of square feet of Rentable Area of the Sublease
Premises. The actual Monthly Base Rent shall be adjusted, as
appropriate, upon determination of the actual Rentable Area of the
Sublease Premises. Month one of the Sublease shall begin on the
Commencement Date and each subsequent month of the Sublease shall begin
on the same day of each subsequent month.
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MONTHLY ANNUAL RATE PER
MONTHS BASE RENT SQUARE FOOT
Months 1-4 0 N/A
Months 5-12 17,907.00 12.00
Months 13-24 18,653.13 12.50
Months 25-36 19,399.25 13.00
Months 37-48 20,145.38 13.50
Months 49-60 20,891.50 14.00
Commencing on the fifth anniversary of the Commencement Date (the "Adjustment
Date"), and subject to the condition stated below, the Monthly Base Rent for
each month of the remainder of the Sublease Term shall be adjusted to the Fair
Rental Value. (as hereinafter defined) of the Sublease Premises as of the
Adjustment Date. For the purposes of this Section 5.2 the term "Fair Rental
Value" means the fair market rental rate for the Sublease Premises calculated
based on the following criteria: Fair Rental Value shall be based upon the
square footage of the Sublease Premises and market conditions in Denver,
Colorado, for space similar to the Sublease Premises in comparable buildings;
shall take into account the fact that Sublessor has already provided a tenant
improvement allowance and free rent and other rental concessions, and paid
brokerage commissions and leasing fees based upon the full term of the Sublease
which includes the period for which the Fair Rental Value is being determined;
and any calculation of Fair Rental Value shall take into account Sublessee's
obligations under Section 6.2 of this Sublease to pay a share of the costs and
expenses which Sublessor is required to pay under the Master Lease and a
comparison of such obligation with the amount of operating costs and expenses
which tenants in comparable buildings are required to pay. Fair Rental Value
shall be determined in accordance with the provisions of Section 5.3 of this
Sublease. If Sublessee shall have achieved on or before the first anniversary
of the Commencement Date an EBITDA Coverage Ratio (as defined below) of not less
than 1.25 to 1 and shall have maintained such EBITDA Coverage Ratio throughout
the first five years of the Lease, then the Monthly Base Rent shall not adjust
to the Fair Rental Value on the Adjustment Date. In such event, Sublessor and
Sublessee shall execute an amendment to this Sublease to reflect that the
Monthly Base Rent for each month of the remainder of the Sublease Term shall be
as set forth in the table below, in each case based on the annual rate per
square foot of Rentable Area set forth in the table below multiplied by the
estimated number of square feet of Rentable Area of the Sublease Premises. The
actual Monthly Base Rent shall be adjusted, as appropriate, upon determination
of the actual Rentable Area of the Sublease Premises. "EBITDA" shall mean net
profits before tax plus interest expense (net of capitalized interest expense),
depreciation expense, amortization expense and leasehold expense under this
Sublease. "EBITDA Coverage Ratio" shall be calculated annually at Sublessee's
fiscal year end and shall mean EBITDA divided by the aggregate of total interest
expense plus the prior period current maturity of long-term debt, the prior
period current maturity of subordinated debt and the prior period leasehold
expense under this Sublease (and in the first year of the Sublease, under the
prior lease for Sublessee's administrative offices).
MONTHLY ANNUAL RATE PER
MONTHS BASE RENT SQUARE FOOT
Months 61-72 21,637.63 14.50
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Months 73-84 22,383.75 15.00
Months 85-96 23,129.88 15.50
Month 97 through end of Term 23,876.00 16.00
5.3 PROCEDURE TO DETERMINE FAIR RENTAL VALUE. The
procedure to determine the Fair Rental Value as of the Adjustment Date
shall be as follows:
5.3.1 No sooner than 210 days and no later
than 180 days prior to the Adjustment Date, Sublessor
shall give Sublessee notice of the impending Adjustment
Date, and upon the giving of that notice, Sublessor and
Sublessee shall meet and attempt in good faith to reach
a mutual written agreement as to the Fair Rental Value
of the Sublease Premises as of the upcoming Adjustment
Date. If Sublessor and Sublessee agree in writing as to
the Fair Rental Value, such agreement shall constitute
the Fair Rental Value for the Adjustment Date. In the
event Sublessor and Sublessee are unable to reach
written agreement within thirty (30) days following
Sublessor's notice, the Fair Rental Value shall be
determined in accordance with the appraisal procedures
set forth in this Section 5.3.
5.3.2 Within ten (10) days following
expiration of the thirty (30) day period described in
subsection 5.3.1 above, Sublessor shall appoint a senior
commercial real estate broker with at least ten (10)
years experience in leasing properties similar to the
Building in the downtown Denver, Colorado area (a
"Qualified Broker"; a Qualified Broker selected by
Sublessor shall be referred to herein as "Sublessor's
Broker"). Sublessor shall give Sublessee notice of the
identity of Sublessor's Broker contemporaneously with
his appointment. Within thirty (30) days after such
appointment, Sublessor's Broker shall render his
appraisal of the Fair Rental Value of the Sublease
Premises for the ensuing remainder of the Sublease Term
and shall give Sublessor and Sublessee written notice of
such determination.
5.3.3 If Sublessee agrees with the
determination of the Fair Rental Value of the Sublease
Premises rendered by Sublessor's Broker, the Monthly
Base Rent hereunder for the remainder of the Term
following the Adjustment Date shall be as determined
therein, and Sublessor and Sublessee shall execute an
amendment to this Sublease evidencing such Monthly Base
Rent. If Sublessee does not so agree, Sublessee shall
have the right to appoint its own Qualified Broker
("Sublessee's Broker") to determine Fair Rental Value of
the Premises, which appointment shall be made within ten
(10) days after Sublessee receives the appraisal of
Sublessor's Broker. Sublessee shall give Sublessor
written notice identifying Sublessee's Broker
contemporaneously with his appointment. Within thirty
(30) days after being appointed by Sublessee,
Sublessee's Broker shall render an appraisal of the Fair
Rental Value of the Premises
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for the ensuing Extension Term and shall give Sublessor
and Sublessee written notice of such determination.
5.3.4 If the appraisals of Sublessor's Broker
and Sublessee's Broker vary from one another, then the
two Appraisers shall meet and attempt to reach a written
agreement on the Fair Rental Value of the Premises for
the ensuing Extension Term; if such written agreement is
made, the same shall be binding upon Sublessor and
Sublessee. If the two Brokers are unable to so agree in
writing on the Fair Rental Value within fifteen (15)
days after Sublessee's Broker gives the notice of its
appraisal, then within ten (10) days after the
expiration of that 15-day period, the two Brokers shall
agree upon and select a third Qualified Broker (the
"Third Broker"). If the two Brokers are unable to agree
upon a Third Broker, either Sublessor or Sublessee may
petition the District Court for the City and County of
Denver, Colorado, to appoint the Third Broker, provided
that ten (10) days prior written notice is given to the
other party hereto. Within ten (10) days after being
appointed, the Third Broker shall, pursuant to an
exercise of his best professional judgment, choose one
or the other of the appraisals rendered by Sublessor's
Broker and Sublessee's Broker as being the more accurate
reflection of the Fair Rental Value of the Premises for
the ensuing Extension Term. Upon making this choice,
the Third Broker shall immediately give the parties
hereto written notice thereof, the appraisal that is so
selected by the Third Broker shall determine the Fair
Rental Value and the Monthly Base Rent hereunder for the
remainder of the Term following the Adjustment Date,
and Sublessor and Sublessee shall execute an amendment
to this Lease evidencing such Monthly Base Rent.
5.4 PAYMENT. Upon execution of this Sublease,
Sublessee shall pay to Sublessor the Security Deposit. Commencing on
the date which is four months after the Commencement Date and continuing
on the first day of each calendar month thereafter during the Term of
this Sublease, Sublessee shall pay to Sublessor the Monthly Base Rent
(prorated if the payment is for a portion of a month) in advance. Rent
for any portion of a month shall be prorated on the basis of a 30-day
month. Monthly Base Rent and all other amounts owing hereunder shall be
payable to Sublessor at Xxxxx Fargo Bank, N.A., 000 Xxxxx Xxxxx Xxxxxx,
Xxx Xxxxxxx, Xxxxxxxxxx 00000, Attention: Asset Manager, or such other
address as Sublessor may specify in accordance with the provisions of
Section 19.1 of this Sublease. It is understood that Sublessor shall
receive the Monthly Base Rent set forth above free and clear of any and
all impositions, taxes, liens, charges or other expenses of any nature
whatsoever required to be paid with regard to the Sublease Premises or
Sublessee's use or occupancy thereof. In addition to the Monthly Base
Rent reserved above, Sublessee shall pay to the parties respectively
entitled thereto all impositions, insurance premiums, operating charges,
maintenance charges, construction costs, and other charges, costs and
expenses which arise or may be contemplated under any provisions of this
Sublease during the term hereof. All such charges, costs and expenses
shall constitute additional Rent, and upon the failure of
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Sublessee to pay any of such costs, charges or expenses, Sublessor
shall have the same rights and remedies as otherwise provided in this
Sublease for the failure of Sublessee to pay Monthly Base Rent. It
is the intention of the parties hereto that, except as expressly
provided herein, this Sublease shall not be terminable for any reason
by Sublessee, and Sublessee shall in no event be entitled to any
abatement of or reduction in rent payable under this Sublease. All
Rent payable hereunder shall be paid in lawful money of the United
States and without prior notice or demand, deduction or offset for
any cause whatsoever. Any delay or failure of Sublessor in computing
or billing for any of the rental adjustments or additional Rent as
provided in this Sublease shall not constitute a waiver of or in any
way impair the continuing obligation of Sublessee to pay any and all
Rent.
5.5 LATE CHARGE AND INTEREST. Sublessee
acknowledges that its late payment of Rent will cause Sublessor to incur
certain costs and expenses not contemplated by this Sublease, including
without limitation administrative and collection costs and processing
and accounting expenses, the exact amount of which is extremely
difficult or impractical to fix. Accordingly, if any installment of
Rent is not paid within five days after the date such Rent is due,
Sublessee shall pay to Sublessor, in addition to the installment of Rent
then owing, a late payment charge equal to 5% of the amount of the
delinquent installment, regardless of whether a notice of default or
notice of termination has been given by Sublessor. The parties agree
that this late charge represents a reasonable estimate of the costs and
expenses incurred by Sublessor from, and is fair compensation to
Sublessor for its loss suffered by, such nonpayment by Sublessee. In
addition to the 5% late charge, any Rent or other amounts owing under
this Sublease which are not paid within five days after the date they
are due shall thereafter bear interest at the rate (the "Interest Rate")
which is the lesser of (a) that rate per annum announced from time to
time by Sublessor as its prime or reference rate plus 5% per annum, or
(b) the maximum rate permitted by law. Notwithstanding the foregoing,
for one installment of Rent per calendar year, no late charge shall be
assessed until such time as Sublessor has provided written notice of the
failure to pay Rent to Sublessee and such failure has continued for a
period of two business days following such notice, but such failure
shall still constitute an Event of Default under Section 16.1(i) of this
Sublease. Nothing in this Section shall relieve Sublessee of its
obligation to pay any Rent at the time and in the manner provided by
this Sublease or constitute a waiver of any default of Sublessee with
regard to any nonpayment of Rent.
5.6 LETTER OF CREDIT. In order to secure
Sublessee's obligations under this Sublease, on or before May 5, 1998,
Sublessee shall cause to be issued and delivered to Sublessor a letter
of credit, for the account of Sublessee and the benefit of Sublessor,
issued by a financial institution reasonably acceptable to Sublessor, in
the face amount of $200,000.00 and otherwise meeting the requirements of
this Section 5.6 (which together with any replacements required by this
Section 5.6 shall be referred to as the "Letter of Credit"). Each
Letter of Credit shall provide that it may be drawn by presentation of a
sight draft of Sublessor to the issuer. If any Letter of Credit, has an
expiry date prior to the second anniversary of the Commencement Date,
Sublessee shall on or before the date that is fifteen (15) days prior to
the expiry cause to be delivered to Sublessor a
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replacement Letter of Credit meeting the requirements of this Section
5.6. Any replacement Letter of Credit issued after the first
anniversary of the Commencement Date shall be in the face amount of
$100,000.00. On the second anniversary of the Commencement Date,
Sublessor shall surrender the Letter of Credit if it has not
previously been drawn and there then exists no Event of Default or
event which with the giving of notice, passage of time or both would
constitute an Event of Default.
6. TAXES, UTILITIES AND SERVICES.
6.1 PERSONAL PROPERTY TAXES. Sublessee shall pay
prior to delinquency any and all taxes and assessments against and
levied upon trade fixtures, furnishings, equipment, and personal
property (including any personal property leased by Sublessor to
Sublessee hereunder) contained in the Sublease Premises. Whenever
possible, Sublessee shall cause such items to be assessed and billed
separately from the real property portion of the Sublease Premises.
Sublessee shall be responsible for any taxes and assessments
attributable to any such items assessed against the real property
portion of the Sublease Premises.
6.2 COSTS AND EXPENSES UNDER MASTER LEASE.
Excluding only the monthly rent owed under the Master Lease, Sublessee
shall pay Sublessee's Share of all costs and expenses of every kind and
nature for which Sublessor is responsible under the Master Lease over
the amount of such costs and expenses paid or payable by Sublessor for
the Sublease Premises for calendar year 1998. Such costs and expenses
shall (i) be paid by Sublessee to Sublessor within ten days after
Sublessor's written demand therefor; and (ii) include, without
limitation, the cost of all taxes and assessments, utilities and
services, parking charges, insurance, sewer charges, janitorial and
disposal services. To the extent not provided under the Master Lease,
Sublessee shall procure, at its sole cost and expense, any and all
facilities necessary to supply the Sublease Premises with water, sewer,
gas, electricity, telephone and all other services required for its use
and occupancy of the Sublease Premises hereunder. Sublessee shall make
payment for any such services directly to the person or entity supplying
such services.
7. MASTER LESSOR'S OBLIGATIONS. It shall be the obligation
of Master Lessor to provide to the Sublease Premises all services and utilities
to be provided by Master Lessor under the terms of the Master Lease, and
Sublessee acknowledges that Sublessor shall be under no obligation to provide
any such services and utilities. Sublessor, upon written notice by Sublessee,
shall diligently attempt to enforce all obligations of Master Lessor under the
Master Lease; provided, that Sublessor shall not be required to initiate or
otherwise participate in any legal action in connection with such enforcement.
If Sublessor is prevented from performing any of its obligations under this
Sublease by a breach by Master Lessor of the Master Lease, then Sublessor's sole
obligation under this Sublease shall be to cooperate with Sublessee, at
Sublessee's sole cost and expense, in pursuing the correction or cure of Master
Lessor's default and in enforcing the terms of the Master Lease. Sublessor
shall not be liable for any claims, costs or damages, including, without
limitation, loss or injury to person or property, and Sublessee shall not be
entitled to any reduction or abatement of rent or other charges hereunder, on
account of any failure of Master Lessor to deliver the services and utilities
described above.
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8. SECURITY DEPOSIT. The Security Deposit shall secure
Sublessee's obligations under this Sublease to pay Rent and any other monetary
amounts, to maintain the Sublease Premises and repair damages thereto, to
surrender the Sublease Premises to Sublessor in the condition required by
Section 4.3 above and to discharge Sublessee's other obligations hereunder.
Notwithstanding the above, Sublessee acknowledges and agrees that the amount of
the Security Deposit shall not in any way be deemed to be a limitation of
Sublessee's liability under this Sublease. Sublessor may use and commingle the
Security Deposit with other funds of Sublessor. If Sublessee fails to perform
Sublessee's obligations hereunder, Sublessor may, but without any obligation to
do so, apply all or any portion of the Security Deposit towards fulfillment of
Sublessee's unperformed obligations. If Sublessor does so apply any portion of
the Security Deposit, Sublessee shall immediately remit to Sublessor cash in an
amount to restore the Security Deposit to its original amount. If Sublessee
fails to restore the Security Deposit to its original amount within five days
after receipt of Sublessor's written demand to do so, Sublessee shall be in
default of this Sublease. Upon termination of this Sublease, if Sublessee has
then performed all of Sublessee's obligations under this Sublease, Sublessor
shall return the Security Deposit, or whatever amount remains of the Security
Deposit after Sublessor applied all or a portion of the Security Deposit to
perform Sublessee's obligations hereunder, to Sublessee without payment of
interest.
9. USE; COMPLIANCE WITH LAWS; PERMITS.
9.1 USE. The Sublease Premises are to be used for
operation of business and professional offices, including any and all
related activities, and for no other purpose or business.
9.2 COMPLIANCE WITH LAW; PROHIBITED ACTIVITIES.
Sublessee shall observe and comply with the requirements of all
covenants, conditions and restrictions of record regarding the Sublease
Premises and all federal, state and local laws, statutes, rule and
regulations now or hereafter in effect (the "Laws"), including but not
limited to the ADA, which apply to the Sublease Premises or the use or
occupancy thereof by Sublessee, including, but not limited to, the
obligation to alter, maintain, repair, improve or restore the Sublease
Premises, and all parts thereof structural and otherwise, in compliance
and conformity with all such Laws. Sublessee shall not commit, or
suffer to be committed or exist, any waste or nuisance on the Sublease
Premises. Sublessee shall not use, store, generate, transit or dispose
of any hazardous substances upon, in about, or under the Sublease
Premises, except any use or storage of any such hazardous substances
customarily used in Sublessee's business, provided that such use or
storage complies with all applicable laws. As used herein, hazardous
substances means any and all hazardous, ultra-hazardous, or toxic
substances, wastes or materials regulated under any laws or regulations
applicable to the environment or the protection of human health.
9.3 PERMITS AND LICENSES. Sublessee shall apply for
and obtain, at its sole expense, all permits, licenses, consents,
permissions or other approvals of any governmental or quasi-governmental
authorities which may be required in order that Sublessee may do any of
the things that Sublessee is required or permitted to do under the
provisions of this Sublease. Sublessor agrees that in all such cases,
whenever reasonably
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requested by Sublessee, Sublessor shall cooperate with Sublessee in
obtaining such permits, licenses, consents, permissions and other
approvals, provided that Sublessor shall not be required to incur any
direct or indirect cost or expense as a result of such cooperation.
10. ASSIGNMENT AND SUBLETTING.
10.1 SUBLESSOR'S CONSENT. Sublessee shall not
transfer or assign this Sublease, or any right or interest hereunder, or
sublet the Sublease Premises or any part thereof (a "Transfer"), without
first obtaining the prior written consent and approval of Sublessor,
which consent shall not be unreasonably withheld or delayed so long as
(i) such Transfer is permissible pursuant to the terms and conditions of
the Master Lease, and (ii) as a result of such Transfer, the Sublease
Premises will not be used for the conduct of any business activities
which would be competitive with any activity which a bank or other
financial institution may lawfully engage in, including, without
limitation, consumer and commercial lending and banking activities,
sales of securities or insurance products or other financial services.
If Sublessee desires to sublease or assign all or a portion of the
Sublease Premises, it shall first provide Sublessor notice that it
intends to undertake marketing efforts and identify the portion of the
Sublease Premises it desires to assign or sublet. Sublessor shall have
the right, to be exercised upon written notice to Sublessee within 45
days following receipt of Sublessee's notice, to terminate this Sublease
as to the portion of the Sublease Premises designated in Sublessee's
notice, such termination to be effective as of 60 days from the date of
Sublessee's notice. If Sublessor does not exercise the right to
terminate, then Sublessee may market the portion of the Sublease
Premises identified in its notice. No later than 30 days prior to the
date of a proposed sublet or assignment, Sublessee shall deliver to
Sublessor written notice of the proposed sublet or assignment, the
identity and legal composition of the proposed assignee or sublessee,
audited financial statements of the proposed sublessee or assignee for
the past three years, the terms (including the intended use of the
Sublease Premises) of the proposed sublet or assignment and, if a
sublet, the portion of the Sublease Premises involved, and any other
information reasonably requested by Sublessor. Sublessor shall notify
Sublessee of its consent or denial of consent within 15 days after
Sublessee has provided Sublessor the information specified in the
preceding sentence. Sublessor shall not unreasonably withhold its
consent to the proposed sublet or assignment. If Sublessor consents to
a proposed Transfer of this Sublease, Sublessee shall pay to Sublessor a
transfer fee of $500.00. If Sublessor's withholding of consent is found
to be unreasonable by a court of competent jurisdiction, Sublessee's
sole remedy shall be to have the proposed Transfer declared valid as if
Sublessor's consent had been given, and Sublessee waives any other
remedy at law or in equity. Sublessee shall deliver to Sublessor
complete, fully executed documentation with regard to the transfer,
assignment or sublease upon execution and delivery of the same.
Sublessor and Sublessee agree that the options to extend the Term hereof
are personal to Sublessee and may not be assigned by Sublessee to any
other party, whether or not in conjunction with a Transfer by Sublessee
of its interest in this Sublease.
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10.2 INVALID TRANSFERS. No Transfer, whether
voluntary or involuntary, by operation of law or under legal process or
proceedings, shall be valid or effective without Sublessor's prior
written consent and approval. The transfer, assignment or hypothecation
of any assets, stock or other ownership interest in Sublessee which in
the aggregate exceeds 50% shall be deemed an assignment within the
meaning of this Section. Should Sublessee attempt to make or suffer to
be made any Transfer of this Sublease without Sublessor's prior written
consent and approval, or should any of Sublessee's rights under this
Sublease be sold or otherwise transferred by or under court order or
legal process or otherwise, or should Sublessee be adjudged insolvent or
bankrupt, then and in any of the foregoing events Sublessor may, at its
sole option, terminate this Sublease upon written notice thereof to
Sublessee.
10.3 NO WAIVERS. Should Sublessor consent to any
transfer, assignment or subletting, such consent shall not constitute a
waiver of any of the requirements or restrictions of this Section, and
the same shall apply to each successive transfer, assignment or
subletting of this Sublease, if any.
10.4 RENTS. If the rents or other payments or
consideration received by Sublessee pursuant to any transfer, sublease
or assignment of this Sublease exceed the Rent due under this Sublease,
or in the case of a sublease of a portion of the Sublease Premises, in
excess of such Rent fairly allocable to such portion, Sublessee shall,
within five days after Sublessee's receipt of same, pay to Sublessor as
additional Rent 1/2 of such excess rents. For purposes of this Section,
"consideration" shall include, without limitation, all monies or other
economic consideration of any kind, if such monies or economic
consideration are related (whether directly or indirectly) to
Sublessee's interest in this Sublease, the Sublease Premises or any
improvements or other property thereon, including without limitation,
bonus money or payments (in excess of book value thereof) for
Sublessee's assets, accounts, good will, general intangibles, personal
property or equity interests in Sublessee.
10.5 NO RELEASE OF SUBLESSEE. Under no circumstances
shall any sublease or assignment of this Sublease by Sublessee in any
way modify, affect or limit the liability of Sublessee under this
Sublease.
11. ALTERATIONS. Sublessee shall not make or suffer to be
made any alterations, additions or improvements (collectively "Alterations") in,
on, or to the Sublease Premises without the prior written consent of Sublessor,
which consent may be granted or withheld in Sublessor's sole discretion. In the
event that Sublessor consent to any such Alterations, Sublessee shall strictly
comply with each and every term or condition applicable thereto contained in the
Master Lease.
12. REPAIRS AND MAINTENANCE. Subject to Master Lessor's
obligations under Article VI of the Master Lease, Sublessee shall during the
term and at Sublessee's sole cost and expense keep the Sublease Premises in as
good order, condition and repair as they were at the time Sublessee took
possession of the Sublease Premises, reasonable wear and tear and damage from
time and other casualties excepted. Sublessee shall keep the Sublease Premises
in a neat and sanitary condition and shall not (a) commit any nuisance or waste
on the Sublease Premises,
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or in, on, or about the Building, (b) dispose of sweepings, rubbish, rags,
coffee grounds or other similar substances in the plumbing facilities, nor
(c) waste any utilities provided by Master Lessor. In addition, Sublessee
shall, at Sublessee's sole expense, immediately repair any damage to the
Sublease Premises or Building caused by Sublessee, Sublessee's agents,
employees, licensees, invitees and visitors. All maintenance, repairs and
replacement by Sublessee hereunder shall be undertaken in accordance with,
and shall be governed by, the requirements of Section 11 above. Sublessor
shall use its best efforts to cause Master Lessor to comply with its
obligations under Article VII of the Master Lease. Sublessee acknowledges
that other than the Improvements, Sublessor is under no duty to make any
repairs or improvements to the Sublease Premises. Sublessee hereby waives
the benefit of any statute or principle of law or equity, now or hereinafter
in effect, which would afford Sublessee the right to make repairs at
Sublessor's expense or to terminate this Sublease because of Sublessor's
failure to keep the Sublease Premises in good order, condition and repair.
13. INSURANCE POLICIES. During the Term, Sublessee shall
procure and maintain in full force and effect and at Sublessee's sole cost
and expense each of the policies of insurance required by the Master Lease.
Each policy of insurance required to be maintained by Sublessee hereunder
shall be issued by an insurance company authorized to do business in the
State of Colorado, with a rating classification of at least an A-, Class VIII
status as rated from time to time in the most current edition of Best's
Insurance Reports and shall provide for only such deductibles as are
reasonably acceptable to Sublessor. Such policies shall be primary and
non-contributing and shall name Sublessor (and Master Lessor, to the extent
required by the Master Lease) as an additional named insured.
13.1 WAIVER OF SUBROGATION. Any policy or policies
of insurance, which either party obtains in connection with the Sublease
Premises, shall, to the extent the same can be obtained without undue
expense, include a clause or endorsement denying the insurer any rights
of subrogation against the other party to the extent rights have been
waived by the insured prior to the occurrence of injury or loss.
Sublessee and Sublessor waive any rights of recovery against the other
for injury or loss due to hazards covered by insurance containing such a
waiver of subrogation clause or endorsement to the extent of the injury
or loss covered thereby.
13.2 INSURANCE CERTIFICATES. Prior to the
Commencement Date (and from time to time, no later than 30 days prior to
the expiration of each insurance policy), Sublessee shall furnish to
Sublessor a certificate of insurance issued by the insurance carrier of
each policy of insurance carried by Sublessee pursuant hereto. Such
certificates of insurance shall reflect (i) that Sublessor (and Master
Lessor, if required by the Master Lease) is an additional named insured;
and (ii) that such insurance policies shall not be cancelable, subject
to reduction of coverage or any other material amendment without a
minimum of 30 days prior written notice to Sublessor and any other
additional named insureds.
14. DAMAGE AND DESTRUCTION.
14.1 TERMINATION OF MASTER LEASE. If as the result
of any damage or destruction, Master Lessor or Sublessor either mutually
agree or exercise any option
17
either may have to terminate the Master Lease as to all or any portion
of the Sublease Premises, this Sublease shall terminate to the same
extent, effective as of the date of such termination of the Master
Lease.
14.2 CONTINUATION OF SUBLEASE. If this Sublease is
not terminated following any damage or destruction as provided above,
this Sublease shall remain in full force and effect. Sublessor shall
use its best efforts to cause Master Lessor to comply with its repair
obligations under Article VI, Section F of the Master Lease. To the
extent Sublessor receives any abatement of rent under the Master Lease
on account of damages to the Sublease Premises, Sublessee's obligation
to pay rent under the Sublease shall be reduced in the same proportion
(i.e., the proportion which the reduction attributable to the Sublease
Premises bears to the total rent attributable to the Sublease Premises
under the Master Lease. Subject to the Master Lessor's obligations
under the Master Lease, Sublessee shall diligently repair, restore or
rebuild the Sublease Premises as nearly as practicable to substantially
the condition in which the Sublease Premises existed immediately prior
to such damage or destruction; provided, that Sublessor shall make
available to Sublessee for such purpose any insurance proceeds actually
received by Sublessor as a result of such damage or destruction.
Sublessee waives the provisions of any statute or other principle of law
or equity which relate to the right to terminate a lease when the thing
leased is destroyed and agrees that such event shall be governed by the
terms hereof. Unless this Sublease shall terminate as provided in
Section 14.1 above and except as set forth above, there shall be no
abatement of Rent payable by Sublessee hereunder by reason of any damage
or destruction of the Sublease Premises. If this Sublease is terminated
as a result of any damage or destruction as provided in Section 14.1
above, or if Sublessee shall fail to promptly and diligently repair,
restore or rebuild the Sublease Premises after any such damage or
destruction as required hereby, all proceeds of insurance resulting from
such damage or destruction shall be paid to Sublessor, and Sublessee
hereby assigns such proceeds to Sublessor in any such event. Payment
and assignment to Sublessor of any such insurance proceeds shall not be
construed as a waiver of any right or remedy Sublessor may have against
Sublessee arising from any breach of this Section.
15. EMINENT DOMAIN.
15.1 TERMINATION OF MASTER LEASE. If as the result
of any condemnation by eminent domain, inverse condemnation or sale in
lieu of condemnation, for any public or a quasi-public use or purpose
("Condemned" or "Condemnation"), Master Lessor or Sublessor either
mutually agree or exercise any option either may have to terminate the
Master Lease as to all or any portion of the Sublease Premises, this
Sublease shall terminate to the same extent, effective as of the date of
such termination of the Master Lease. If all of the Sublease Premises
(or such part thereof that Sublessee cannot reasonably operate in the
remainder substantially the same business being conducted in the
Sublease Premises) is Condemned, Sublessee may terminate this Sublease.
18
15.2 PARTIAL CONDEMNATION. If this Sublease is not
terminated following any such Condemnation as set forth above, this
Sublease shall remain in full force and effect. In such event,
Sublessor shall use its best efforts to cause Master Lessor to comply
with its obligation to repair, alter or restore the Sublease Premises
under Article XI of the Master Lease. Subject to Master Lessor's
obligations under the Master Lease, Sublessee shall repair, restore or
rebuild the Sublease Premises as nearly as practicable to substantially
the condition in which the Sublease Premises existed immediately prior
to such Condemnation, provided that Sublessor shall make available to
Sublessee for such purpose that portion of the Condemnation award
allowed for physical damage to that portion of the Sublease Premises not
taken in such Condemnation. Sublessee hereby waives the provisions of
any applicable statute or principal of law or equity permitting
termination this Sublease upon Condemnation. To the extent Sublessor
receives any rental reduction under the Master Lease attributable to the
Sublease Premises, the Monthly Base Rent shall be reduced in the same
proportion (i.e., the proportion which the reduction attributable to the
Sublease Premises bears to the total rent attributable to the Sublease
Premises under the Master Lease). Unless this Sublease shall terminate
as a result of any Condemnation, there shall be no abatement of Rent
payable by Sublessee hereunder as a result of any Condemnation.
15.3 SUBLESSEE'S AWARD. Sublessor reserves all
rights to damages to the Sublease Premises and Sublessor 's interest in
the subleasehold created by this Sublease hereafter accruing by reason
of any Condemnation. However, as between Sublessor and Sublessee, and
subject to all rights of the Master Lessor under the Master Lease,
Sublessee reserves the right to the equitable portion of any award for
damages for the value to Sublessee of any unexpired term of this
Sublease (in the event such Condemnation causes a termination of the
Sublease). Article XI of the Master Lease sets forth procedures for
determining the value of Sublessor's rights to a share of any
Condemnation award attributable to early termination of the Master
Lease. Sublessee shall be entitled to a share of a Condemnation award
for the unexpired term of the Sublease only if Sublessor receives a
share of such Condemnation award for the value of the unexpired term of
the Master Lease and then only the equitable share of such Condemnation
award received by Sublessor as is attributable to the Sublease Premises
for the term of this Sublease. If Sublessor and Sublessee cannot agree
upon the share of any Condemnation award attributable to the Sublease
Premises for the term of the Sublease, the matter shall be determined by
arbitration in accordance with the provisions set forth in the Master
Lease.
16. DEFAULT.
16.1 EVENTS OF DEFAULT. The occurrence of any one or
more of the following events shall constitute an "Event of Default" on
the part of Sublessee with or with-out notice from Sublessor (except as
required by Section 16.1(ii) below):
(i) Payment. Sublessee's failure to pay any
installment of Rent on or before five days after such payment is due;
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(ii) Performance. Sublessee's failure to perform any
of Sublessee's covenants, agreements or obligations here-under (other
than the nonpayment of Rent which shall be governed by Section 16.1(i)
above or to provide any required Letter of Credit which shall be
governed by Section 16.1(viii) below) on or before 30 days after written
notice thereof from Sublessor;
(iii) Assignment. A general assignment by Sublessee
for the benefit of creditors;
(iv) Bankruptcy. The filing of a voluntary petition
by Sublessee, or the filing of an involuntary petition by any of
Sublessee's creditors seeking the rehabilitation, liquidation or
reorganization of Sublessee under any law relating to bankruptcy,
insolvency or other relief of debtors;
(v) Receivership. The appointment of a receiver or
other custodian to take possession of substantially all of Sublessee's
assets or of this lease-hold;
(vi) Insolvency, Dissolution, Etc. Sublessee shall
become insolvent or unable to pay its debts, or shall fail generally to
pay its debts as they be-come due; or any court shall enter a decree or
order directing the winding up or liquidation of Sublessee or of
substantially all of its assets; or Sublessee shall take any action
toward the dissolution or winding up of its affairs or the cessation or
suspension of its use of the Sublease Premises;
(vii) Attachment. Attachment, execution or other
judicial seizure of substantially all of Sublessee's assets or this
leasehold; or
(viii) Letter of Credit. Sublessee's failure to
provide any Letter of Credit required pursuant to Section 5.6 of this
Sublease on the date required.
16.2 SUBLESSOR'S REMEDIES.
(i) Abandonment. If Sublessee vacates or abandons
the Sublease Premises, this Sublease shall continue in effect unless and
until terminated by Sublessor in writing, and Sublessor shall have all
of the rights and remedies provided by applicable laws.
(ii) Termination. Following the occurrence of any
Event of Default, Sublessor shall have the right, so long as the default
continues, to terminate this Sublease by written notice to Sublessee
setting forth: (i) the default; (ii) the requirements to cure it; and
(iii) a demand for possession, which shall be effective three days after
it is given. Sublessor shall not be deemed to have terminated this
Sublease other than by delivering written notice of termination to
Sublessee.
(iii) Possession. Following termination of the
Sublease, without prejudice to any other remedies Sublessor may have by
reason of Sublessee's default or of such termination, Sublessor may then
or at any time thereafter (i) peaceably reenter the
20
Sublease Premises, or any part thereof, upon voluntary surrender by
Sublessee, or, expel or remove Sublessee and any other persons
occupying the Sublease Premises, using such legal proceedings as may
be available; (ii) repossess and enjoy the Sublease Premises, or
relet the Sublease Premises or any part thereof for such term or
terms (which may be for a term extending beyond the Term), at such
rental or rentals and upon such other terms and conditions as
Sublessor in Sublessor's sole discretion shall determine, with the
right to make reasonable alterations and re-pairs to the Sublease
Premises; and (iii) remove all personal property from the Sublease
Premises.
(iv) Recovery. Following termination of the
Sublease, Sublessor shall have all the rights and remedies of a
Sublessor provided by applicable law, including the right to recover (i)
the worth at the time of the award of the unpaid rent which had been
earned at the time of termination; (ii) the worth at the time of the
award of the amount by which the unpaid rent which would have been
earned after termination until the time of the award exceeds the amount
of such rental loss that Sublessee proves could have been reasonably
avoided; (iii) the worth at the time of the award of the amount by which
the unpaid rent for the balance of the Term after the time of award
exceeds the amount of such rental loss that Sublessee proves could be
reasonably avoided; and (iv) any other amount necessary to compensate
Sublessor for all detriment proximately caused by Sublessee's failure to
per-form Sublessee's obligations under the Sublease or which in the
ordinary course of things would be likely to result therefrom. The
"worth at the time of award" of the amounts referred to in (i) and (ii)
of this subsection, shall be computed by allowing interest at the
Interest Rate. The "worth at the time of the award" of the amount
referred to in (iii) above shall be computed by discounting such amount
at the discount rate of the Federal Reserve Bank of San Francisco at the
time of award plus one percent (1%).
(v) Other. If Sublessee causes or threatens to
cause a breach of any of the covenants, terms or conditions contained in
this Sublease, Sublessor shall be entitled to retain all sums held by
Sublessor, any trustee or in any account provided for herein, to enjoin
such breach or threatened breach, and to invoke any remedy al-lowed at
law, in equity, by statute or otherwise as though re-entry, summary
proceedings and other remedies were not provided for in this Sublease.
(vi) Cumulative. Each right and remedy of Sublessor
provided for in this Sublease shall be cumulative and shall be in
addition to every other right or remedy pro-vided for now or hereafter
existing at law, in equity, by statute or otherwise. The exercise or
beginning of the exercise by Sublessor of any one or more of the rights
or remedies provided for in this Sublease, or now or hereafter existing
at law, in equity, by statute, or otherwise, shall not preclude the
simultaneous or later exercise by Sublessor of any or all other rights
or remedies provided for in this Sublease or now or here-after existing
at law, in equity, by statute, or otherwise.
(vii) No Waiver. No failure by Sublessor to insist
upon the strict performance of any term hereof or to exercise any right
or remedy consequent upon a breach thereof, and no acceptance of full or
partial payment of rent during the
21
continuance of any such breach shall constitute a waiver of any such
breach or of any such term. Efforts by Sublessor to mitigate the
damages caused by Sublessee's breach of this Sublease shall not be
construed to be a waiver of Sublessor's right to recover damages
under this Section.
(viii) Sublessor's Right to Perform. Upon Sublessee's
failure to perform any obligation of Sublessee hereunder, including,
without limitation, payment of Sublessee's insurance premiums and
charges of contractors who have supplied materials or labor to the
Sublease Premises, Sublessor shall have the right, but not the
obligation, to perform such obligations of Sublessee on behalf of
Sublessee or to make payment on behalf of Sublessee to such parties, or
both. Upon demand, Sublessee shall reimburse Sublessor for the cost of
Sublessor's performing such obligations on Sublessee's behalf,
including, without limitation, reimbursement of any amounts that may be
expended by Sublessor and Sublessor's reasonable attorneys' fees, plus
interest at the Interest Rate, from the date of any such expenditure
until the same is repaid.
(ix) Additional Remedies. In addition to the
foregoing remedies and so long as this Sublease is not terminated,
Sublessor shall have the right to maintain or improve the Sublease
Premises without terminating this Sublease; to incur expenses on behalf
of Sublessee in seeking a subtenant or assignee, including, without
limitation, brokers' commissions, expenses of remodeling the Sublease
Premises, and any other inducements which Sublessor determines, in
Sublessor's sole discretion, are necessary; to cause a receiver to be
appointed to administer the Sublease Premises and any new or existing
subleases; and to add to the Rent payable hereunder all of Sublessor's
costs in so doing, including reasonable attorneys' fees, with interest
at the Interest Rate from the date of such expenditure until the same is
repaid.
(x) Additional Rent. For purposes of any unlawful
detainer action by Sublessor against Sublessee, Sublessor shall be
entitled to recover as Rent not only such sums specified as the Monthly
Base Rent which may then be overdue, but also any and all additional
sums of money as may then be overdue.
(xi) Indemnification. Sublessor's exercise of any
one or more of the remedies set forth in this Section shall not affect
the rights of Sublessor or the obligations of Sublessee under the
indemnification set forth in Section 17 hereof.
(xii) After Default. Sublessor shall be under no
obligation to observe or perform any covenant of this Sublease on its
part to be observed or performed which accrues after the date of any
Event of Default, and for so long as the Event of Default continues.
(xiii) Letter of Credit. Sublessor may draw upon the
Letter of Credit and apply the proceeds thereof to any of Sublessee's
obligations under this Sublease in any order or manner as Sublessor
deems appropriate or, after termination, to any amounts Sublessor is
entitled to recover under subsection 16.2(iv) above.
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17. EXCULPATION AND INDEMNIFICATION OF SUBLESSOR.
17.1 EXCULPATION. Sublessor shall not be liable to
Sublessee, and Sublessee hereby waives all claims arising from any loss,
injury, or other damage to any person or property (including, but not
limited to, Sublessee or Sublessee's property), in or about the Sublease
Premises from any cause (including, but not limited to, defects in the
Sublease Premises or any equipment or other personal property in the
Sublease Premises; fire, explosion, or other casualty; damage to or
defects in any telephone wiring or cabling; or bursting, rupture,
leakage, or overflow of any plumbing or other pipes, piping, tubes,
tubing, lines, sprinklers, tanks, drains, drinking fountains, or wash
basins or stands), except to the extent that such claims arise by the
willful misconduct or grossly negligent acts or omissions of Sublessor.
In no event, however, shall Sublessor be liable to Sublessee for any
punitive or consequential damage or damages for loss of business by
Sublessee.
17.2 INDEMNIFICATION BY SUBLESSEE. Sublessee shall
indemnify, defend with counsel reasonably acceptable to Sublessor, and
hold Sublessor, and its officers, directors, employees and agents,
harmless from and against any and all liabilities, penalties, losses,
damages, costs and expenses, demands, causes of action, claims or
judgments (including, without limitation, attorneys' fees and expenses)
(collectively referred to as the "Claims") arising, claimed or incurred
against or by Sublessor, or its officers, directors, employees or
agents, from any matter or thing arising from (i) the use or occupancy
of the Sublease Premises by Sublessee or any of its partners, employees,
agents, licensees and invitees, the conduct of Sublessee's business, or
from any activity, work or other thing done, permitted or suffered by
Sublessee in or about the Sublease Premises; (ii) any accident, injury
to or death of Sublessee or its partners, employees, agents, invitees or
licensees or any other person or loss of or damage to property of
Sublessee or any such persons occurring on or about the Sublease
Premises or any part thereof during the term hereof; or (iii) any breach
or default in the performance of any obligation on Sublessee's part or
to be performed under the terms of this Sublease or the Master Lease.
Sublessee shall have no obligation to indemnify, defend and hold
Sublessor harmless from and against any Claims resulting solely from
Sublessor's breach of this Sublease or from the negligence or willful
misconduct of Sublessor. Notwithstanding any provision hereof to the
contrary, the indemnification provided in this Section shall survive any
termination of this Sublease or expiration of the Term hereof.
Sublessee shall give prompt notice to Sublessor in case of casualty or
accidents known to Sublessee on or about the Sublease Premises.
17.3 INDEMNIFICATION BY SUBLESSOR. Sublessor shall
indemnify, defend with counsel reasonably acceptable to Sublessee, and
hold Sublessee, and its officers, directors, employees and agents,
harmless from and against any and all Claims arising, claimed or
incurred against or by Sublessee or its officers, directors, employees
or agents, from any matter or thing arising from any breach or default
in the performance of any obligation on Sublessor's part to be performed
under the terms of this Sublease or the Master Lease. Sublessor shall
have no obligation to indemnify, defend and hold Sublessee harmless from
and against any Claims resulting solely from Sublessee's breach
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of this Sublease or from the negligence or willful misconduct of
Sublessee. Notwithstanding any provision hereof to the contrary, the
indemnification provided in this Section shall survive a termination
of this Sublease or expiration of the term hereof.
18. BROKERAGE COMMISSION. Sublessee represents and warrants
to Sublessor that except for The Staubach Company, which has represented
Sublessee in connection with the sublease of the Sublease Premises contemplated
hereby, no other broker or finder can properly claim a right to a commission or
a finder's fee based upon contacts between the claimant and Sublessee with
respect to Sublessor, this Sublease or the Sublease Premises. Sublessee shall
indemnify, defend (with counsel reasonably acceptable to Sublessor) and hold
Sublessor harmless from and against any loss, cost or expense, including, but
not limited to, attorneys' fees and court costs, resulting from any claim for a
fee or commission by any other broker or finder in connection with the Sublease
Premises and this Sublease.
19. GENERAL PROVISIONS.
19.1 NOTICES. All notices or demands of any kind
required or desired to be given hereunder shall be in writing and mailed
postage prepaid by certified or registered mail, return receipt
requested, or by personal delivery, to the appropriate address indicated
in the Basic Sublease Information, or at such other place or places as
either Sublessor or Sublessee may, from time to time, designate in a
written notice given to the other. Notices shall be deemed to be
delivered two business days after the date of mailing thereof, or upon
earlier receipt.
19.2 ENTRY BY SUBLESSOR. Sublessor and its
authorized representatives shall have the right to enter the Sublease
Premises at all reasonable times and upon reasonable notice (provided
that in the event of an emergency, notice need not be given) for the
purpose of inspecting the same or taking any action or doing any work
permitted hereunder (but nothing herein contained in this Lease shall
create or imply any duty on the part of Sublessor to make any such
inspection or to take any such action or do any such work). No such
entry shall constitute an eviction of Sublessee. In connection with any
such entry, Sublessor will use reasonable efforts not to disrupt or
interfere with the normal operation of Sublessee's business.
19.3 ESTOPPEL CERTIFICATES. Each party shall, from
time to time upon not less than 30 days prior written notice from the
other execute, acknowledge and deliver to the other a statement in
writing (a) certifying that this Sublease is unmodified and in full
force and effect (or, if modified, stating the nature of such
modification), and the date to which the Rent and other charges are paid
in advance, if any, (b) acknowledging that there are not, to such
party's knowledge, any uncured defaults on the part of the other
hereunder, or specifying such defaults if any are claimed, and (c)
setting forth the date of expiration of the term hereof.
19.4 LIENS. Sublessee covenants that it will not,
during the Term hereof, suffer or permit any lien to be attached to or
upon the Sublease Premises, or any portion thereof, by reason of any act
or omission on the part of Sublessee, and hereby agrees to save and hold
harmless Sublessor from or against any such lien or claim of lien.
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In the event any such lien does attach or any claim of lien is made
against the Sublease Premises which may be occasioned by any act or
omission upon the part of Sublessee, and shall not be released
within 30 days after notice from Sublessor to Sublessee so to do,
Sublessor in its sole discretion, except as provided below, may pay
and discharge the same and remove any such lien from the Sublease
Premises. Sublessee agrees to repay and reimburse Sublessor, upon
demand, for any amount which may have been paid by Sublessor in
discharging such lien, together with interest at the Interest Rate
from the date of the expenditure by Sublessor to the date of
repayment by Sublessee.
19.5 TIME. Time is of the essence of this Sublease.
If any date set forth for the performance of any obligation or for the
delivery of any instrument or notice should be on a Saturday, Sunday or
legal holiday, compliance with such obligations or delivery shall be
deemed acceptable on the next business day following such Saturday,
Sunday or legal holiday. As used herein, the term "legal holiday" means
any state or federal holiday for which financial institutions and post
offices are generally closed in the State of Colorado for observance
thereof. Except as expressly provided to the contrary in this Sublease,
all references to days shall mean calendar days.
19.6 ENTIRE AGREEMENT. This Sublease contains all of
the covenants, conditions and agreements between the parties concerning
the Sublease Premises, and shall supersede all prior correspondence,
agreements and understandings concerning the Sublease Premises, both
oral and written. No addition or modification of any term or provision
of this Sublease shall be effective unless set forth in writing and
signed by both Sublessor and Sublessee.
19.7 SUCCESSORS AND ASSIGNS. Subject to the
provisions of this Sublease relating to assignment, mortgaging and
subletting, this Sublease is intended to and does bind the heirs,
executors, administrators, successors and assigns of any and all of the
parties hereto.
19.8 AUTHORITY. Each individual executing this
Sublease on behalf of Sublessee represents and warrants that he or she
is duly authorized to execute and deliver this Sublease on behalf of
Sublessee, and that this Sublease is binding upon Sublessee in
accordance with its terms. As a condition precedent to the legal
effectiveness of this Sublease, Sublessor may, at Sublessor's option,
require corporate or partnership resolutions as are reasonably necessary
to establish the authority of Sublessee to execute this Sublease.
19.9 EXHIBITS. The exhibits attached hereto are made
a part of this Sublease by this reference.
19.10 ATTORNEYS' FEES; WAIVER OF JURY TRIAL. If any
party commences an action against the other party arising out of or in
connection with this Sublease, (a) the prevailing party shall be
entitled to recover from the losing party the cost and expenses of such
action, including reasonable collection fees, attorneys' fees (including
without limitation the allocated cost of in-house counsel) and court
costs; and (b) the parties agree
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that the matter shall be tried by the court without a jury, and each
party specifically waives the right to a jury trial in any such
action.
19.11 GOVERNING LAW. This Sublease shall be governed
by and construed in accordance with the laws of the State of Colorado
applicable to contracts to be performed in such State.
19.12 CAPTIONS. All captions and headings in this
Sublease are for the purposes of reference and convenience and shall not
limit or expand the provisions of this Sublease.
19.13 MASTER LESSOR'S CONSENT. This Sublease is
conditioned upon Master Lessor's written approval of this Sublease. If
for any reason Master Lessor does not consent to this Sublease within
the 30 days after the full execution of this Sublease, then this
Sublease shall terminate, Sublessor shall return to Sublessee the
Security Deposit (if previously delivered to Sublessor) and any prepaid
rent, and neither party shall have any other continuing obligation to
the other with respect to the Sublease Premises or this Sublease.
19.14 DEFINITION OF SUBLESSOR. As used in this
Sublease, the term "Sublessor" means only the current owner of the
leasehold interest of the lessee under the Master Lease at the time in
question. Each Sublessor is obligated to perform the obligations of the
Sublessor hereunder only during the time such Sublessor owns such
leasehold interest. Any Sublessor who transfers title to its leasehold
interest in the Sublease Premises is relieved of all liabilities of
Sublessor under this Sublease to be performed on or after the date of
such transfer.
19.15 FORCE MAJEURE. As used in this Sublease, the
term "Force Majeure" as applied to the obligations of Sublessor shall
mean strikes, lockouts or labor unrest, shortages of labor or materials,
disease, pestilence or epidemic, acts of God, governmental actions or
restrictions, war, enemy action, riot, civil commotion, fire, accident
or unavoidable casualty, or other causes beyond the reasonable control
of Sublessor.
19.16 JOINT AND SEVERAL LIABILITY. If more than one
person and/or entity is Sublessee, the obligations imposed under this
Sublease shall be joint and several.
19.17 WAIVERS. No provision of this Sublease shall be
deemed to have been waived, unless such waiver is in writing signed by
the party against whom the waiver is sought to be enforced and addressed
to the other party, nor shall any custom or practice which may evolve
between the parties in the administration of the terms hereof be
construed to waive either party's right to require the obligations of
the other party be performed in strict accordance with the terms of this
Sublease.
19.18 QUIET USE AND ENJOYMENT. So long as Sublessee
is not in default hereunder, Sublessee's quiet use and enjoyment of the
Sublease Premises shall not be disturbed.
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IN WITNESS WHEREOF, the parties shall be deemed to have executed
this Sublease as of the date first set forth above.
SUBLESSOR:
XXXXX FARGO BANK, N.A.
By: /s/ Xxx X. Xxxxxx
Name: Xxx X. Xxxxxx
Title: Vice President
By: /s/ Xxxx X. Xxxxxx
Name: Xxxx X. Xxxxxx
Title: SVP
SUBLESSEE:
GREASE MONKEY INTERNATIONAL, INC.,
a Colorado corporation
By: /s/ Xxxx Xxxxxxx Xxxxx
Name: Xxxx Xxxxxxx Xxxxx
Title: Vice President
By:
-----------------------------
Name:
---------------------------
Title:
--------------------------
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CONSENT OF MASTER LESSOR
The undersigned, Master Lessor of the Sublease Premises, hereby consents
to the foregoing Sublease.
"MASTER LESSOR"
PRUDENTIAL INSURANCE COMPANY OF
AMERICA, a ______________________
By:
-----------------------------
Name:
---------------------------
Title:
--------------------------
By:
-----------------------------
Name:
---------------------------
Title:
--------------------------
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