ARISTA PLACE OFFICE LEASE ARISTA PLACE, LLC LANDLORD AND ARCA DISCOVERY, INC. TENANT LEASE

Exhibit 10.9

ARISTA PLACE

OFFICE LEASE

ARISTA PLACE, LLC

LANDLORD

AND

ARCA DISCOVERY, INC.

TENANT

LEASE

THIS LEASE (this “Lease”) is entered into by Landlord and Tenant as described in the following Basic Lease Information on the Date which is set forth for reference only in the following Basic Lease Information.

Landlord and Tenant agree:

ARTICLE 1

Basic Lease Information

1.1 Terms . In addition to the terms which are defined elsewhere in this Lease, the following defined terms are used in this Lease:

(a) DATE: February 8, 2008.

(b) LANDLORD: Arista Place, LLC, a Colorado limited liability company.

(c) TENANT: ARCA DISCOVERY, INC., a Delaware corporation.

(d) BUILDING: The building known as 8001 Arista Place, Broomfield, Colorado 80021 as shown on the site plan attached hereto as Exhibit A and of which the Premises are a part.

(e) LAND: The real property legally described on Exhibit B .

(f) RENTABLE AREA: The “Rentable Area” of the Premises and any other space in the Building shall be determined pursuant to the Standard Method for Measuring Floor Area in Office Buildings, ANSI/BOMA Z65.1-1996, as modified for specific application for the Building.

(g) PREMISES: A portion of the second (2nd) floor of the Building comprising approximately 15,000 square feet of Rentable Area as depicted on Exhibit A-1 together with the dedicated, non-exclusive parking in the Parkade parking structure garage adjacent to the Building; provided , however , that the Rentable Area of the Premises shall be subject to adjustment based on the actual measurements made by Landlord’s Building architect and pursuant to a certificate executed by Landlord’s Building architect certifying such adjustment.

(h) TERM: Five (5) years, beginning on the Commencement Date and expiring on the Termination Date. Tenant has the right to extend the Term pursuant to the terms of Exhibit C attached hereto and incorporated herein by this reference, and any Extended Terms (as defined in Exhibit C) that are properly exercised by Tenant shall be deemed part of the “Term” for all purposes hereof

(i) COMMENCEMENT DATE: The later of (a) March 19, 2008, or (b) the date that Landlord delivers to Tenant, and Tenant accepts from Landlord, the Premises with Landlord’s Work (as hereinafter defined) Substantially Completed (as hereinafter defined).

(j) RENT COMMENCEMENT DATE: The earlier of (a) the date that is seventy-five (75) days after the Commencement Date, and (b) the date that Tenant (or any person claiming by, through or under Tenant) occupies any portion of the Premises for the conduct of its business. Once the Rent Commencement Date is determined, the parties shall, at the request of either Landlord or Tenant, execute a certificate memorializing the Commencement Date, the Rent Commencement Date, the Termination Date, the Rentable Area, and the Fixed Monthly Rent schedule.

(k) TERMINATION DATE: The last day of the month in which the Fifth (5th) anniversary of the Rent Commencement Date occurs.

(l) BASE RENT:

 

(m) SECURITY DEPOSIT: An amount equal to three months of the Base Rent payable by Tenant on the first Lease Year, and due upon the execution of this Lease.

(n) PROPERTY: The Land and the improvements and the Building located on the Land.

(o) TENANT’S SHARE: For costs attributable to the Building and the Project (as reasonably determined by Landlord and evidenced by appropriate documentation), the quotient obtained by dividing the Rentable Area of the Premises by the Rentable Area of the Building, and estimated to be $9.50 per rentable square foot on an annual basis for the first Lease Year (as hereinafter defined).

(p) PERMITTED USE: Operation of an office for conducting the business activities incident to general office use, and all uses ancillary to such business, and for no other purpose.

(q) LANDLORD’S BROKER: CB Richard Ellis.

(r) TENANT’S BROKER: Catalyst Planning Group, LLC.

(s) RENT: Base Rent, Additional Rent and any other amounts which Tenant is required to pay under this Lease.

(t) COMMON AREAS: Those areas defined as such in Section 8.1.

(u) LANDLORD’S ADDRESS (for notices pursuant to Section 17.1):

Arista Place, LLC

Attention: David Hostetler

555 Eldorado Blvd., Suite 200

Broomfield, CO 80021

(v) TENANT’S ADDRESS (for notices pursuant to Section 17.1):

Before the Commencement Date:

Area Discovery, Inc.

Attention: Pat Wheeler

1200 17th Street, Suite 620

Denver, CO 80202

After the Commencement Date:

At the Premises

Attention: Pat Wheeler, Vice President Finance

(w) PROJECT: Arista, of which the Building is a part.

 

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(x) GUARANTOR: None.

(y) LEASE YEAR: A twelve (12) month period, except for the first Lease Year, which shall include any partial month occurring at the beginning of the Term. The first Lease Year commences on the Rent Commencement Date, the second Lease Year commences on the first day of the month following the first anniversary of the month in which the Rent Commencement Date occurs, and each subsequent Lease Year commences on the day after the end of the previous Lease Year.

(z) LANDLORD’S WORK: The work as described on Exhibit D-1 attached hereto.

(aa) SUBSTANTIAL COMPLETION: “Substantial Completion,” “Substantially Completed” or words of similar import means that Landlord’s Work has been completed in accordance with the provisions of Exhibit D-1, attached hereto except for details or adjustments that do not interfere with Tenant’s construction of Tenant’s Improvements (as hereinafter defined) in such a manner as to delay Tenant’s Improvements as reasonably determined by Tenant’s project manager in conjunction with Landlord’s project manager. Substantial Completion, for purposes of achieving the targeted Commencement Date and the Rent Commencement Date shall exclude (a) those areas of work that might be impaired by and which are not essential to Tenant’s Improvements, including but not limited to finish work in the lobby, elevators, bathrooms and security, and (b) other items of Landlord’s work which, if delayed, would benefit or improve Tenant’s scheduling of Tenant’s Work, including. without limitation, delivering the Premises drywalled.

1.2 Exhibits . The following exhibits are attached to this Lease and are made part of this Lease:

 

ARTICLE 2

Demise and Commencement

2.1 Demise; Tender . Landlord hereby leases to Tenant and Tenant hereby leases and hires from Landlord the Premises, for the Term, at the rental, and upon all of the conditions set forth in this Lease. No easement for light, view or air is included in the lease of the Premises hereby made. Landlord will tender the Premises to Tenant upon the Commencement Date.

2.2 Term . The duration of this Lease shall be the Term. The Term will commence on the Commencement Date and expire on the Termination Date.

2.3 Right of First Refusal . Provided that Tenant is not in default under this Lease beyond any applicable cure period, Tenant shall have a right of first refusal to lease all or any portion of approximately 8,400 square feet of contiguous space on the second floor of the Building (the “Second Floor Additional Space”), subject to the following terms and conditions:

(a) Prior to Landlord entering into a lease for all or any part of the Second Floor Additional Space with a third party (the “ROFR Space”), Landlord shall first offer in writing such ROFR Space for lease to Tenant on the same terms and conditions quoted to such third party (“Landlord’s Offer”).

 

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(b) Within ten (10) business days after Tenant receives said offer from Landlord, Tenant shall either accept or reject such offer by written notice to Landlord. Failure by Tenant to deliver to Landlord a written acceptance thereof within such period shall be deemed a rejection by Tenant of such offer.

(c) If Tenant rejects or is deemed to have rejected said offer, this right of first refusal with respect to the ROFR Space shall be deemed to have terminated and Landlord shall thereafter be entitled to lease all or any portion of the ROFR Space to such third party upon the same terms and conditions as specified in Landlord’s Offer: provided , however , that: (i) said right of first refusal shall remain in effect if Landlord does not consummate a lease with the third party within ninety (90) days after Tenant receives Landlord’s Offer; (ii) Landlord shall have no right to consummate a lease with a third party for all or any portion of the ROFR Space on terms and conditions that are different than those in Landlord’s Offer; and (iii) nothing shall affect Tenant’s right of first refusal to any Second Floor Additional Space not part of the ROFR Space.

(d) If Tenant accepts said offer in accordance with the provisions hereof, Landlord and Tenant shall thereupon execute an amendment to this Lease adding the ROFR Space to this Lease in accordance with the terms and conditions of Landlord’s Offer plus a tenant improvement allowance of up to Thirty-Five Dollars ($35) per rentable square foot of the ROFR Space for completion of wall to wall improvements by Tenant pursuant to a work letter agreement reasonable acceptable, in form and substance, to Landlord and Tenant. If Tenant fails to execute said amendment within ten (10) business days after Landlord furnishes same to Tenant, the acceptance of Landlord’s offer shall be deemed to have been rejected by Tenant and thereupon the provisions of subparagraph (c) above shall apply. If Tenant rejects Landlord’s offer, or if Tenant is deemed to have rejected such offer, Tenant’s right of first refusal to lease the ROFR Space shall immediately terminate and shall be of no further force or effect.

(e) Prior to Landlord’s execution of the Lease amendment, Tenant shall furnish to Landlord current financial statements of Tenant prepared by a certified public accountant prepared in accordance with generally accepted accounting principles. As a condition of Landlord’s adding the ROFR Space to the Lease, Landlord shall have the right to approve the financial condition of Tenant which approval Landlord shall not unreasonably withhold, condition or delay; provided , however , that Landlord’s approval shall not be required if the financial condition of Tenant at such time is equal or greater than the financial condition of Tenant as of the Date. If the Landlord has the right to approve the financial condition of Tenant pursuant to the immediately preceding sentence and the Landlord does not approve the financial condition of Tenant with respect to such ROFR Space, then Tenant’s right of first refusal with respect to such ROFR Space shall terminate and immediately be of no further force or effect with respect to such ROFR Space; provided , however , that nothing shall affect Tenant’s right of first refusal to any Second Floor Additional Space not part of the ROFR Space.

2.4 Right of First Offer .

(a) Provided that Tenant is not in default of its obligations under this Lease, during the Term hereof, Tenant shall have the right of first offer to lease 100% of the space in the 8181 Arista Place Building, with the exception of the first floor retail space (the “Additional Space”). Landlord shall give Tenant written notice of the availability of any portion of the Additional Space (such portion, the “ROFO Space”) and Landlord’s good-faith estimate of the market net effective rent at which such space will be offered. Tenant shall have ten (10) business days from the receipt of Landlord’s notice to notify Landlord in writing whether it will lease the ROFO Space at the rent specified in Landlord’s notice. In the event Tenant declines the offer to lease the ROFO Space or fails to notify Landlord within said ten (10) business days, Tenant’s right of first offer with respect to that ROFO Space shall be null and void and of no further force and effect, and Landlord shall be free to lease such ROFO space to any person or entity upon any terms and for any purpose; provided , however , that: (i) said right of first offer shall remain in effect if Landlord does not consummate a lease with a third party within ninety (90) days after “Tenant receives Landlord’s notice; and (ii) if Landlord desires to lease the ROFO Space at a rental that is less than that specified in Landlord’s notice to Tenant (or Landlord provides such monetary incentives to such other tenant as to make such rental on a net basis less than that specified in Landlord’s notice to Tenant), then Landlord shall be obligated to present a new offer to Tenant and Tenant shall have the same time period to accept such new offer as Landlord’s original offer,

(b) If Tenant accepts said offer in accordance with the provisions hereof, Landlord and Tenant shall thereupon execute an amendment to this Lease adding the ROFO Space to this Lease in accordance

 

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with the terms and conditions of Landlord’s notice plus a tenant improvement allowance of up to Thirty-Five Dollars ($35) per rentable square foot of the ROFO Space for completion of wall to wall improvements by Tenant pursuant to a work letter agreement reasonably acceptable, in form and substance, to Landlord and Tenant.

(c) Prior to Landlord’s execution of the Lease amendment, Tenant shall furnish to Landlord current financial statements of Tenant prepared by a certified public accountant prepared in accordance with generally accepted accounting principles, As a condition of Landlord’s adding the ROFO Space to the Lease, Landlord shall have the right to approve the financial condition of Tenant which approval Landlord shall not unreasonably withhold, condition or delay; provided , however , that Landlord’s approval shall not be required if the financial condition of Tenant at such time is equal or greater than the financial condition of Tenant as of the Date. If the Landlord has the right to approve the financial condition of Tenant pursuant to the immediately preceding sentence and the Landlord does not approve the financial condition of Tenant with respect to such ROFO Space, then Tenant’s right of first refusal with respect to such ROFO Space shall terminate and immediately be of no further force or effect with respect to such ROFO Space; provided , however , that nothing shall affect Tenant’s right of first offer to any Additional Space not part of the ROFO Space.

2.5 Landlord’s Work .

(a) On the Commencement Date, Landlord shall deliver to Tenant, subject to Tenant’s acceptance, the Premises with Landlord’s Work Substantially Completed. Landlord shall give Tenant at least ten (10) days prior written notice prior to the date on which Landlord intends to deliver the Premises to Tenant with Landlord’s Work Substantially Completed.

(b) Notwithstanding anything to the contrary contained in this Lease, if:

(i) the Commencement Date has not occurred because Landlord has not Substantially Completed Landlord’s Work and delivered the Premises to Tenant by March 19, 2008, (the “Delivery Date”), then the Rent Commencement Date shall be extended by one day for each day occurring during the period commencing on the Delivery Date through and including the occurrence of the Commencement Date;

(ii) Landlord has not delivered to Tenant a certificate of occupancy on the core shell of the Building from the appropriate governmental agency (the “Certificate”) by June 2, 2008 (the “Outside Delivery Date”), then the Rent Commencement Date shall be extended by two (2) days for each day occurring during the period commencing on the Outside Delivery Date through and including the date that Landlord delivers to Tenant such Certificate;

(iii) Landlord has not delivered to Tenant the Certificate by June 12, 2008, then Landlord shall be responsible for, and hereby agrees to indemnify and hold Tenant harmless against: (A) any and all claims, costs and liabilities, including attorneys’ fees, court costs, and other expenses of litigation, arising out of or in connection with Tenant’s holdover in Tenant’s current space; (B) any and all expenses incurred by Tenant on account of Tenant’s expedited move to the Premises which are in excess of normal moving expenses; and (C) if Tenant has notified Landlord by May 25, 2008 that Tenant will be required to relocate from its current space to temporary space after May 31, 2008, then Landlord shall be responsible for all costs and expenses incurred by Tenant in connection with such temporary space after June 12, 2008, including, without limitation, rent and moving costs; and

(iv) Landlord has not delivered to Tenant the Certificate or Landlord has not delivered the Premises with Landlord’s Work Substantially Completed by June 30, 2008, then Tenant shall have the right, in addition to any other rights hereunder, to terminate this Lease upon written notice to Landlord.

(c) Landlord and Tenant acknowledge and agree that if Landlord is unable to meet any of the dates set forth in Section 2.5(b) above as a result of a delay caused solely (i) by Tenant, or (ii) Tenant’s contractor (“Tenant Delay”), then Landlord shall be afforded additional time to meet such dates in the exact proportion to the delay caused by Tenant or Tenant’s contractor. If any date called for herein falls upon a Saturday, Sunday or legal holiday, such date shall be moved to the next immediately following business day.

 

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2.6 Hours . During the term, Landlord shall furnish heating, ventilating and air conditioning to the Premises between the hours of 7:00 a.m. and 6:00 p.m. Monday through Friday (holidays excepted) and 8:00 a.m. to 12:00 p.m. on Saturdays. Landlord, at Tenant’s sole cost and expense, shall provide overtime air conditioning to the Premises as requested by Tenant in advance during the Term and Tenant shall reimburse Landlord for Landlord’s reasonable costs for the supply of such overtime air conditioning, which reasonable costs shall be billed to Tenant on a monthly basis. For purposes of the preceding sentence, “reasonable costs” shall not include amortization or depreciation of any equipment that provides such overtime air conditioning. Landlord shall provide Tenant with reasonable documentation evidencing such costs. The Building will offer a 24 hour card key access to lobby entries and elevators.

ARTICLE 3

Base Rent, Additional Rent, Taxes and Security Deposit

3.1 Base Rent . On or before the first day of each and every month during the Term, commencing on the Rent Commencement Date, Tenant agrees to pay to Landlord the Base Rent, without notice or demand, in advance. Base Rent for any period of less than 1 month shall be prorated based upon the total number of days in the month in which such period occurs. Base Rent and all other Rent due hereunder shall be paid to Landlord, without deduction or offset, in lawful money of the United States of America at Landlord’s Address or at such other place as Landlord may from time to time designate in writing.

3.2 Additional Rent . In addition to the Base Rent, Tenant shall pay to Landlord Tenant’s Share of Common Area Expenses, Taxes, and Insurance Costs (as reasonably determined by Landlord) for each Lease Year, or portion thereof (such costs being collectively referred to herein as “Additional Rent”).

3.3 Additional Rent Payment . Tenant shall pay to Landlord each month of each Lease Year of the Term 1/12th of the estimated amount of Additional Rent owed by Tenant for such Lease Year pursuant to Section 3.2. During the final month of each Lease Year during the Term, or as soon thereafter as practicable, Landlord shall give Tenant written notice of the Additional Rent for the ensuing Lease Year in additional to reasonable documentary evidence to Tenant of such Additional Rent (Upon Tenant’s request, Landlord shall provide Tenant such documentary evidence for the first Lease Year prior to Tenant being obligated to pay Additional Rent for such first Lease Year). On or before the first day of each month during the ensuing Lease Year, Tenant shall pay to Landlord 1/12th of such Additional Rent; provided , however , that if such notice is not given during the final month of the Lease Year, Tenant shall continue to pay on the basis of the prior Lease Year’s Additional Rent until the month after such notice is given. In the month Tenant first makes a payment based upon the new Additional Rent, Tenant shall pay to Landlord the difference between the amount payable based on the new Additional Rent and the amount actually paid by Tenant for each month which has elapsed since the end of the prior Lease Year. Within one hundred twenty (120) days after the end of each Lease Year, or a reasonable time thereafter, Landlord shall deliver to Tenant a statement of Additional Rent for such Lease Year, along with reasonable documentary evidence to Tenant, and Tenant shall pay Landlord or Landlord shall credit Tenant (or, if such adjustment is at the end of the Term, pay Tenant), within thirty (30) days of receipt of such statement, the amount of any excess or deficiency in Tenant’s payment of its portion of Additional Rent for the Lease Year.

3.4 Common Area Expenses . The term “Common Area Expenses” means, with respect to any given Lease Year during the Term, all of Landlord’s costs and expenses that are reasonably incurred and directly attributable to the operation, maintenance, management, and repair of the Building, alleyways, parking facilities and Common Areas as determined under generally accepted accounting principles consistently applied, and calculated on an accrual basis, including, without limitation, reasonable and out-of-pocket expenses and fees imposed by any governing owners or building association (i.e. the Arista Master Association), as well as reasonable and out-of-pocket costs of cleaning, window washing, maintaining window coverings, landscaping, elevator maintenance, lighting, heating, air conditioning, paving, painting, and repairing the Building or any portion of it, maintaining any associated or adjoining alleyways or parking facilities, removing snow and ice, trash removal, providing security, management fees paid to third-party contractors, providing seasonal holiday decorations, providing public liability, property damage, fire and extended coverage and such other insurance as Landlord deems appropriate (but

 

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excluding terrorism insurance), wages, salaries and compensation of employees who are not above the level of building manager, consulting, accounting, legal, janitorial, maintenance, guard, fire protection, fire hydrant and other services, the actual cost, without profit, of power (as to Common Areas only), water, waste disposal and other utilities, if such utilities are not separately metered, licenses and permit fees, the total amounts paid by Landlord in satisfaction of any assessment made by any building or property owners’ association for the purpose of providing any services or benefits to the Premises or, to the extent enjoyed by Tenant or its occupants, the Building generally, depreciation on personal property and equipment used in the operation or maintenance of the Building and rent paid for leasing such equipment, real and personal property taxes and assessment (and any tax levied in whole or in part in lieu of or in addition to such property taxes) on the Building, the related real property or Landlord’s personal property used in the operation or maintenance of the Building (except for Taxes or as otherwise specified below), the pro-rata share of costs of maintenance or operation of the Project, and any other costs, charges and expenses which are reasonably regarded as management, maintenance and operating expenses of Landlord for the Building, plus all reasonable costs (depreciated over the useful life of the item as Landlord will reasonably determine in accordance with sound management accounting principles, together with market interest thereon) of any capital improvements which arc made to the Building by Landlord (a) for the purpose of reducing the costs described in this paragraph, or (b) after the date of this Lease and which are required under any governmental law or regulation. Notwithstanding the foregoing, Common Area Expenses will not include:

(a) costs of a capital nature including capital improvements, capital repairs, capital equipment, and capital tools, as determined under generally accepted accounting principles consistently applied;

(b) rentals and other related expenses incurred in leasing air conditioning systems, elevators, or other equipment ordinarily considered to be of a capital nature;

(c) depreciation and amortization on the Building or any portion of it (other than depreciation on personal property and equipment as described above);

(d) costs, disbursements and other expenses (including permit, license, and inspection fees) incurred for leasing, renovating, decorating or redecorating, painting or improving space for tenants or potential tenants of the Building;

(e) Landlord’s cost of electricity or any other service sold to tenants for which Landlord is to be reimbursed as a charge over the rent payable under the lease with that specific tenant;

(f) principal or interest payments on loans secured by mortgages or deeds of trust on the Building or lease rentals paid or payable on any ground or underlying lease;

(g) financing or refinancing costs and mortgage interest and mortgage amortization payments, all penalties, fines and damages payable under any mortgage or deed of trust and legal and other professional fees incurred in connection with such financing or refinancing;

(h) costs incurred with respect to a sale of all or any portion of the Building or the land or the Property or any interest therein or of any interest in Landlord or any entity comprising Landlord;

(i) all expenses for which Landlord has received any reimbursement to the extent of such reimbursement, other than indirect reimbursement by the payment of any tenant of Base Rent or its share of Common Area Expenses, or for which Tenant has paid to third parties or items or services that Landlord provides selectively to one or more tenants of the Building other than Tenant;

(j) repairs or other work needed because of fire, windstorm, or other casualty or cause insured against by Landlord to the extent Landlord’s insurance provides insurance coverage, or any other costs recoverable by Landlord under its insurance, excluding the cost of deductibles paid by Landlord for insurance;

(k) expenses (including, without limitation, leasing commissions, rents payable for a leasing office, architectural, space planning or engineering services) incurred in leasing or procuring tenants;

 

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(l) to the extent any cost is includable in Common Area Expenses and incurred with respect to both the Building and other properties (including, without limitation, salaries, fringe benefits and other compensation of Landlord’s personnel who provide services to both the Building and other properties), there shall be excluded from Common Area Expenses a fair and reasonable percentage thereof which is properly allocable to such other properties;

(m) the cost of the acquisition of the Property or the construction of improvements to the Building in connection with an expansion thereof;

(n) professional fees (including legal and accounting fees) not allocated to the operation or management of the Property and professional fees (including legal and accounting fees) allocable to disputes with, or preparation of leases for, tenants and prospective tenants or in enforcing any lease or in renewing, extending or amending any lease for a tenant in the Building;

(o) Any penalty charges incurred by Landlord due to the violation of any law unless such charges result from the violation of law by any tenant or such tenant’s failure to pay for the same, which shall be paid for and billed directly to such tenant;

(p) cost of repairs or other work occasioned by the exercise of the right of eminent domain;

(q) Advertising and promotional expenditures;

(r) federal, state, or local income taxes, franchise, gift, transfer, excise, capital stock, estate, succession, or inheritance taxes, and penalties or interest for late payment of Taxes (as hereinafter defined);

(s) costs incurred because Landlord or another tenant violated the terms of any lease;

(t) overhead and pro fit paid to subsidiaries or affiliates of Landlord for management or other services on or to the Property or for supplies or other materials, to the extent that the costs of the services, supplies, or materials were higher than the cost thereof if they had not been provided by a subsidiary or affiliate;

(u) fines or penalties incurred because Landlord violated any governmental rule or authority due to Landlord’s actions or omissions;

(v) costs or expenses of a partnership, or other entity, which constitutes Landlord not directly related to the Property (such as accounting fees, tax returns and income taxes of such entity), expenses incurred by Landlord not directly related to the land, the Property, the Building and/or its operations including, without limitation, compensation paid to officers, executives, or partners of Landlord; nor

(w) other expenses that under generally accepted accounting principles consistently applied would not be considered normal maintenance, repair, management, or operation expenses.

Tenant may review Landlord’s records of Tenant’s Share of Common Area Expenses, at Tenant’s sole cost and expense, upon reasonable prior notice at the place Landlord normally maintains such records during Landlord’s normal business hours. Tenant shall have a qualified CPA, unrelated to Tenant or Tenant’s business, which CPA shall not be paid on a contingency basis, perform the audit. If the audit reveals that Tenant’s actual payments for Common Area Expenses exceed Tenant’s Share of Common Area Expenses, Landlord shall apply any overpayment to the next payment of Common Area Expenses due. In the event that the audit reveals that Tenant’s actual payments for Common Area Expenses are less than Tenant’s Share of Common Area Expenses, Tenant shall pay Landlord the deficiency within ten (10) days,

3.5 Taxes . The term “Taxes” shall include, for any calendar year or applicable tax year or period, the total amount incurred or accrued during such calendar year or tax year or period for that portion of the following items that is allocable to that taxable parcel of property of which the Premises is a part (“Tenant’s Tax Parcel”): all ad valorem real property taxes and assessments, special or otherwise, fees or other charges levied upon or with

 

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respect to Tenant’s Tax Parcel, and the rents and additional charges payable by tenants of Tenant’s Tax Parcel, and imposed by any city, county, special/metropolitan district or other taxing authority having jurisdiction, including, but not limited to the Arista Metropolitan District, the Arista Local Improvement District and the Broomfield Urban Renewal Authority; all taxes, levies, fees and charges which may be assessed, levied or imposed in replacement of, or in addition to, all or any part of ad valorem real property taxes or assessments as revenue sources, and which in whole or in part are measured or calculated by or based upon Tenant’s Tax Parcel (including the Common Areas), the leasehold estate of the owners or tenants of Tenant’s Tax Parcel, or the rents and other charges payable by such tenants; capital and place-of-business taxes, and other similar taxes assessed relating to the Common Areas; and any reasonable expenses incurred by Landlord or the other owners of retail premises within Tenant’s Tax Parcel in attempting to reduce or avoid an increase in Taxes, including, without limitation, reasonable legal fees and costs. Notwithstanding anything in this Lease to the contrary, Taxes will not include the following (the “Excluded Taxes”): (i) any (a) taxes on Landlord’s income, or profit or corporate taxes, (b) franchise taxes, (c) estate, inheritance, succession, capital stock, mortgage recording, gains, transfer or gift taxes, or (d) similar taxes imposed on Landlord; (ii) any ad valorem real property taxes and assessments levied upon or with respect to any separately assessed premises; and (iii) any interest or penalties incurred as a result of Landlord’s late payment of Taxes, excepting if such interest or penalty, if any, is due to the actions of Tenant,

3.6 Landlord’s Insurance Costs . The term “Insurance Costs” shall include the costs of all policies of insurance carried by Landlord in accordance with Article 10.

3.7 Other Taxes . As Additional Rent, Tenant shall reimburse Landlord upon demand for any and all taxes payable by Landlord (other than the Excluded Taxes), whether or not now customary or within the contemplation of Landlord and Tenant, within thirty (30) days after receipt of written demand therefore:

(a) upon, measured or reasonably attributable to the cost or value of Tenant’s equipment, furniture, fixtures and other personal property located in the Premises or Alterations (defined in Section 6.1), made in or to the Premises by or for Tenant, regardless of whether title to such improvements is in Tenant or Landlord;

(b) upon or measured by Rent, including without limitation, any gross income tax or excise tax levied by the federal government or any other governmental body with respect to the receipt of Rent;

(c) upon or with respect to the possession, leasing, operating, management, maintenance, alteration, repair, use or occupancy by Tenant of the Premises or any portion of the Premises; and

(d) upon this transaction or any document to which Tenant is a party creating or transferring an interest or an estate in the Premises.

Tenant shall pay promptly when due all sales, merchandise and personal property taxes on Tenant’s personal property in the Premises and any other taxes payable by Tenant, the non-payment of which might give rise to a lien on the Premises or Tenant’s interest in the Premises.

3.8 Security Deposit . On or before the Commencement Date, Tenant shall deposit with Landlord the Security Deposit. The Security Deposit shall be held by Landlord as security for the timely and faithful performance by Tenant of all the terms, covenants, and conditions of this Lease to be kept and performed by Tenant during the Term. If Tenant defaults with respect to any provision of this Lease, including, but not limited to, the provisions relating to the payment of Base Rent, Tenant’s Share of Common Area Expenses or any other Rent, Landlord may (but shall not be required to) use, apply or retain all or any part of the Security Deposit for payment of Base Rent, Tenant’s Share of Common Area Expenses or any other Rent due, or for the payment of any amount which Landlord may spend or become obligated to spend by reason of Tenant’s default, or to compensate Landlord for any other loss or damage, including reasonable attorneys’ fees, which Landlord may suffer by reason of Tenant’s default. If any portion of the Security Deposit is so used or applied, Tenant shall, within five (5) days after receipt of written demand therefor, deposit cash with Landlord in an amount sufficient to restore the Security Deposit to its original amount, and Tenant’s failure to do so shall be an Event of Default under this Lease. Landlord shall not be required to keep the Security Deposit separate from its general funds, and Tenant shall not he entitled to interest on the Security Deposit. If Tenant shall fully and faithfully perform every provision of this Lease to be performed by it, the Security Deposit or any balance thereof shall be returned to Tenant (or, at Landlord’s option, to the last assignee of Tenant’s

 

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interest hereunder) within thirty (30) days following expiration of the Term and Tenant’s vacation of the Premises in accordance with Section 20.1, less any amount reasonably withheld by Landlord for repairs under this Lease, which repairs shall not include ordinary wear and tear.

ARTICLE 4

Parking

4.1 Subject to applicable codes and ordinances, and any recorded documents now or hereafter affecting the Building, Tenant shall be entitled to the non-exclusive and non-reserved use of 4 parking spaces per 1,000 square feet of rentable area in the Premises in the Grand Parkade (the “Tenant’s Parking Ratio”) during the hours of 6:00 am to 6:00 pm Monday through Friday (the “Guaranteed Parking Hours”); provided , however , that Landlord shall have the right to temporarily curtail Tenant’s Parking Ratio during Guaranteed Parking Hours solely in the event that Landlord requires the use of such parking spaces in connection with its development of the Building provided that Landlord shall work with Tenant to make reasonable accommodations for Tenant’s parking needs during such development. In addition to Tenant’s rights to Tenant’s Parking Radio during Guaranteed Parking Hours, Tenant shall also be entitled to: (i) Tenant’s Parking Ratio during such times other than Guaranteed Parking Hours so long as the parking spaces used by Tenant are occupied on or prior to 6:00 pm on Monday through Friday and then during such time as such parking spaces remain occupied, and (ii) such parking spaces as may be available during such times other than Guaranteed Parking Hours. Tenant’s use of parking in the Property shall at all times be at no cost to Tenant.

ARTICLE 5

Signage

5.1 Signs . Tenant shall have the right to signage on the lobby directory at Landlord’s cost and on the main entry door to the Premises and on the Building at Tenant’s cost, subject to Landlord’s standards and approval as to the design, location, size, color and type of all such signage (which approval by Landlord shall not be unreasonably withheld, conditioned or delayed), and subject to Tenant receiving all necessary and required approvals from any relevant governmental authority or governing body. All signage shall be installed and maintained at Tenant’s sole expense in accordance with the plans submitted to and approved by Landlord (which approval by Landlord shall not be unreasonably withheld, conditioned or delayed) and all Applicable Laws.

ARTICLE 6

Alteration, Care, Repair and Liens

6.1 Alterations, Additions and Improvements . Tenant shall not make or allow to be made any alteration, addition or improvement in or to the Premises (“Alterations”, and each an “Alteration”) without the prior written consent of Landlord, which consent shall not be unreasonably withheld, conditioned or delayed if such Alterations do not affect the structural, exterior, mechanical, electrical or plumbing components of the Building or Premises, except that Landlord’s consent shall not be required for any: (i) purely decorative alterations such as painting, plastering, carpeting and similar decorative items; (ii) nonstructural interior alterations costing, for each respective project, Fifty Thousand Dollars ($50,000.00) or less; and (iii) the Tenant Improvements and other initial alterations in connection with Tenant’s initial occupancy of the Premises. Landlord’s consent to any Alteration requiring Landlord’s consent or Landlord’s approval of any plans or specifications therefor will not create any responsibility or liability on the part of Landlord for the completeness, design sufficiency or compliance with any Applicable Laws, rules or regulations of governmental agencies or authorities of such Alteration, plans or specifications. In the event Landlord consents to the making of any Alteration, such Alteration shall be made by Tenant at Tenant’s sole cost and expense. Landlord may impose, as a condition to granting such approval, reasonable requirements, including without limitation, requiring that plans and specifications be submitted for Landlord’s approval, which approval shall not be unreasonably withheld, conditioned or delayed, that reasonable insurance in light of the proposed Alteration be maintained by Tenant, and that construction be accomplished during a reasonable specified time period. All Alterations shall be done in accordance with all Applicable Laws, regulations, ordinances; and rules of all governmental or other authorities. In undertaking any Alteration, Tenant shall not make or permit any defacement, injury or waste in, to or about the Premises or any part of the Building. Any Alterations, including, but not limited to, wall coverings, paneling and built-in shelving or cabinet work, but excepting movable furniture and trade fixtures, shall, at the option of Landlord, become a part of the Premises and Landlord’s property and shall

 

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be surrendered with the Premises. Notwithstanding the foregoing, upon the expiration or sooner termination of the Term, Tenant shall at Tenant’s sole cost and expense, forthwith and with all due diligence, remove any Alterations made by Tenant and designated by Landlord in writing to Tenant at the time of approval by Landlord of such Alterations that same must be so removed. Tenant shall repair any damage to the Premises caused by such removal and restore the Premises to their condition at the commencement of this Lease, ordinary wear and tear and damage by casualty excluded.

6.2 Tenant’s Care and Repair . Except for those items expressly required to be maintained and repaired by Landlord pursuant to Section 8.3, Tenant will maintain and repair the Premises (including, without limitation, Tenant’s equipment, personal property and trade fixtures located in the Premises, and all mechanical, plumbing and electrical equipment after the point of connection to the Premises and which exclusively serve the Premises), in good working order and in good, clean and sanitary condition, reasonable wear and tear and damage by casualty excluded. Tenant will immediately advise Landlord of any damage to the Premises or the Building. At Landlord’s option, and subject to the provisions of Section 10.6 below, all damage or injury to the Premises or the Building, or the fixtures, appurtenances and equipment in the Premises or Building which is caused by Tenant, its agents, employees, or invitees, may be repaired, restored or replaced by Landlord, and Tenant shall be responsible for Landlord’s out-of-pocket expenses incurred by Landlord, plus five (5%) percent thereof on account of Landlord’s overhead and related expenses, which will be collectible as Rent and will be paid by Tenant within ten (10) days after delivery of a statement for such expense along with documentary evidence reasonably acceptable to Tenant of such expenses. All repairs made by Tenant shall be made using contractors approved by Landlord, which approval shall not be unreasonably withheld, conditioned or delayed.

6.3 Mechanic’s Liens . Tenant agrees to pay when due all sums of money that may become due for, or purporting to be due for, any labor, services, materials, supplies or equipment alleged to have been furnished or to be furnished to or for Tenant in, upon or about the Premises and/or Landlord’s interest therein.

If any mechanic’s lien shall be filed or threatened against the Premises, the Property or the Building based upon any act of Tenant or anyone claiming by, through or under Tenant, Tenant, after notice thereof from Landlord, promptly shall commence such action by bonding over, payment or otherwise, as will remove or satisfy such lien within thirty (30) days. In the event Tenant does not remove or satisfy said lien within said thirty (30) day period, Landlord shall have the right to do so by posting a bond or undertaking and Tenant agrees to reimburse Landlord for any and all expenses incurred by Landlord in connection therewith within ten (10) days after receipt by Tenant of Landlord’s invoice therefor. These expenses include, but are not limited to, filing fees, legal fees and bond premiums.

In addition to any other requirements set forth in this Lease, prior to the commencement of any construction or the furnishing of any materials within the Premises by or at the direction of Tenant, Tenant shall post and keep posted in a conspicuous place upon the Premises a notice pursuant to Colorado Revised Statutes § 38-22-105 (as amended) and any appropriate notice wider any similar law or regulation, notifying all laborers and materialmen providing labor or materials to the Premises that the Premises, Building, and Landlord’s interest therein are not subject to any lien for the same.

However, nothing in this Section 6.3 shall he deemed or construed as (a) Landlord’s consent to any person, firm or corporation for the performance of any work or services or the supply of any materials to the Premises, or (b) giving Tenant or any other person, firm or corporation any right to contract for or to perform or supply any work, services or materials that would permit or give rise to a lien against the Premises or the Building.

ARTICLE 7

Use of Premises

7.1 General . The Premises will be used only for the Permitted Use and for no other purpose. In addition, Tenant will not: (i) do or permit to be done in or about the Premises, nor bring to, keep or permit to be brought or kept in the Premises, anything which is prohibited by or will in any way conflict with any law, statute, ordinance or governmental rule or regulation which is now in force or which may be enacted or promulgated after the date of this Lease; (ii) permit anything to be done in or about the Premises which will in any way obstruct or interfere with the rights of other occupants or users of the Building, or injure or unreasonably annoy them; (iii) use or allow the Premises to be used for any improper, immoral, unlawful or objectionable purpose; or (iv) cause, maintain or permit any nuisance in, on or about the Premises or commit or allow to be committed any waste in, on or about the Premises.

 

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7.2 Applicable Laws . “Applicable Laws” shall mean all laws, statutes, ordinances, and governmental rules, regulations or requirements now in force or in force after the date of this Lease, the governing documents, rules, regulations or requirements of any governing association, whether now in force or in force after the date of this Lease, the requirements of any board of fire underwriters or other similar body constituted on or after the date of this Lease, any direction or permanent occupancy certificate issued pursuant to any law by any public officer or officers, as well as the provisions of all recorded documents affecting the Premises. At its sole cost and expense, Tenant will promptly comply with all Applicable Laws insofar as they relate to (i) Tenant’s use, occupancy or alteration of the Premises, (ii) the condition of the Premises resulting from Tenant’s use, occupancy or alteration of the Premises, or (iii) alterations to the Premises required as a result of Tenant’s status under Applicable Laws. Tenant will not be required to perform structural changes or changes outside the Premises required by Applicable Laws unless such requirement arises by virtue of (a) Tenant’s use or occupancy of the Premises, or (b) improvements or alterations made by or for Tenant.

7.3 Operation of Tenant’s Business . Tenant hereby acknowledges that it has investigated whether its proposed use of the Premises and its proposed manner of operation will comply with all Applicable Laws, and Tenant assumes the risk that its proposed use of the Premises and its proposed manner of operation are, and will continue to be, in compliance with all Applicable Laws, including, without limitation, all zoning laws regulating the use and enjoyment of the Premises. Tenant hereby waives any defense to its obligations hereunder based upon the legal doctrines of frustration, impossibility or other defenses based on its inability to use the Premises for the purposes for which they are leased hereunder. Tenant acknowledges that neither Landlord nor any agent of Landlord has made any representation or warranty as to the suitability of the Premises to the conduct of Tenant’s business.

7.4 Hazardous Materials . As used in this Section 7.4, the term “Hazardous Materials” shall mean any hazardous or toxic substances, materials or wastes which are regulated, or become regulated, by the United States Government or by any State of Colorado, local, or other governmental authority. Tenant shall not store, use or dispose of any Hazardous Materials in, on or about the Premises or any portion of the Building in violation of applicable laws. Tenant will be solely responsible for and will defend, indemnify and hold Landlord, its agents and employees harmless from and against all claims, costs and liabilities, including attorneys’ fees, court costs. and other expenses of litigation (i) arising out of or in connection with Tenant’s breach of its obligations contained in this Section 7.4, or (ii) arising out of or in connection with the removal, clean-up and restoration work and materials required under applicable law to return the Premises or any portion of the Building to the condition existing prior to the appearance of Hazardous Materials stored, used or disposed in or about the Premises by Tenant in violation of applicable laws. Without limiting the foregoing, if Tenant is not in compliance with this Section 7.4 after ten (10) days after receipt by Tenant of written notice from Landlord of Tenant’s breach of this Section 7.4, Landlord shall have the right, but not the obligation, to enter upon the Premises and take whatever actions are reasonably necessary to effectuate compliance including, but not limited to, the removal of any such Hazardous Materials. Tenant’s obligations under this Section 7.4 will survive the expiration or other termination of this Lease.

7.5 Rules and Regulations . The Tenant agrees to comply with the rules and regulations set forth in Exhibit E and with such reasonable modifications thereof and additions thereto as the Landlord may hereafter from time to time make for the Building. The Landlord shall not be responsible for the non observance by any other tenant of any said rules and regulations.

ARTICLE 8

Common Areas and Services

8.1 Definition . The term “Common Areas” is defined to mean all areas and facilities within or adjoining the Building that are provided and designated from time to time by Landlord for the general, nonexclusive use and convenience of all tenants of the Building and their respective employees, invitees, licensees and other visitors, including, without limitation, alleyways, lobbies, hallways, entry ways, loading areas, toilet facilities, elevator facilities, shafts, driveways, parking areas, mechanical and electrical rooms, janitors’ and storage closets, stairways, lighting facilities, trash facilities, utility lines, sidewalks, covered walkways, terraces, loading areas, underground walkways, plazas, courts, retaining walls, access drives, truck serviceways and landscaped areas.

 

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8.2 Right of Use . Landlord grants Tenant, its employees, invitees, customers, licensees and other visitors a nonexclusive license for the Term to use the Common Areas, subject to the terms and conditions of this Lease. Without advance notice to Tenant (except with respect to matters covered by subsection (a) below) and without any liability to Tenant in any respect, Landlord will have the right to:

(a) establish and enforce reasonable rules and regulations concerning the maintenance, management, use and operation of the Common Areas;

(b) close off any of the Common Areas to whatever extent required in the opinion of Landlord and its counsel to prevent a dedication of any of the Common Areas or the accrual of any rights by any person or the public to the Common Areas, provided such closure does not deprive Tenant of the beneficial use, access to or enjoyment of the Premises in any material respect;

(c) temporarily close any of the Common Areas for maintenance, alteration or improvement purposes, provided such closure does not deprive Tenant of the beneficial use, access to or enjoyment of the Premises in any material respect;

(d) change the size, use, shape or nature of any such Common Areas, or change the arrangement and/or location of or regulate or eliminate the use of any concourse, or any elevators, stairs, toilets or other public conveniences in the Common Areas, provided such changes does not deprive Tenant of the beneficial use, access to or enjoyment of the Premises in any material respect;

(e) expand the Building or convert any portion of the Building (excluding the Premises) to Common Areas, provided such expansion or conversion does not deprive Tenant of the beneficial use, access to or enjoyment of the Premises in any material respect, In the event of any such changes in the Building, Landlord may make an appropriate adjustment in Tenant’s Share;

(f) limit or prohibit Tenant’s access to certain Common Areas, such as, by way of example but not limitation, the roof, access shafts, storage closets, janitor closets, and other areas necessary for Building operations, but not generally open to tenants, provided such limited or prohibited’ access does not deprive Tenant of the beneficial use, access to or enjoyment of the Premises in any material respect.

8.3 Landlord’s Maintenance and Services .

(a) Repair and Maintenance . Landlord will maintain, repair and restore or cause to be maintained, repaired and restored the Common Areas, including, but not limited to lobbies, elevator(s), stairs, roof, walkways, driveways and restrooms, if any; the mechanical, plumbing and electrical equipment serving the Building and the Premises; and the structural components of the Building, in reasonably good order and condition; provided , however , that such obligations shall be subject to the provisions of Article 11 and Article 12.

(b) Services . Landlord will keep or cause to be kept the Common Areas in clean and orderly condition, free of debris and properly lighted and landscaped. Landlord will also provide or cause to be provided electricity, heating, ventilation and air-conditioning (as required by the seasons), lighting, restroom supplies, window washing and janitorial services to the Premises and to the interior Common Areas sufficient for their normal use. Landlord will not be in default under this Lease or be liable for any damages directly or indirectly resulting from, nor will the Rent be abated by reason of the following (each, an “Interruption”) (a) the installation, use or interruption of use of any equipment in connection with the furnishing of any of such services, (b) the failure to furnish, or delay in furnishing, any such services when such failure or delay is caused by accident or any condition beyond the reasonable control of Landlord or by the making of necessary repairs or improvements to any portion of the Building, (c) any limitation, rationing or restrictions on use of water, electricity, gas or any other form of energy serving the Building; (d) the completion of construction surrounding the Building, including construction of parks, adjacent buildings or improvements relating to either, or (e) any interruption in access to the Common Areas caused by any activities conducted by or at the direction of governmental or quasi-governmental authorities within the public right-of-ways or alley adjacent to the Land; provided , however , if such Interruption is caused by or due to the gross negligence or willful acts or omissions of Landlord, its agents, servants or employees, contractors, or

 

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Landlord’s default under this Lease, then, and without being obligated or waiving Landlord’s default, Tenant shall have the right to do any or all of the following: (i) abate all Base Rent and Additional Rent from the date of such Interruption; (ii) if such Interruption is not resolved within seven (7) days, take all actions to resolve such Interruption and in such case, Landlord shall reimburse Tenant the amounts incurred by Tenant in resolving such Interruption within thirty (30) days after delivery to Landlord of any invoices or expenses from Tenant and if Landlord shall fail to reimburse Tenant, then Tenant may offset the reimbursements due Tenant against any payment becoming due under this Lease or any other payment obligations under this Lease (provided nothing herein shall limit any other rights and remedies available to Tenant at law, in equity, and/or under this Lease); and/or (iii) if such Interruption is not resolved within thirty (30) days, then Tenant may elect to terminate this Lease by providing Landlord with written notice and this Lease shall terminate effective as of the date of such notice.

(c) Limitation on Liability . Landlord will not be liable to Tenant or any other person, for direct or consequential damages, or otherwise, for any failure to supply any heat, air conditioning, elevator, cleaning, lighting, or other service which Landlord has agreed to supply during any period when Landlord uses reasonable diligence to supply such services; provided , however , if such service is caused by or due to the gross negligence or willful acts or omissions of Landlord, its agents, servants or employees, contractors, or Landlord’s default under this Lease, then, in addition to any remedies available by law, and without being obligated or waiving Landlord’s default, Tenant shall have the cumulative right to do any or all of the following: (i) abate all Base Rent and Additional Rent from the date of such service interruption; (ii) if such service interruption is not resolved within seven (7) days, take all actions to resolve such service interruption and in such case, Landlord shall reimburse Tenant the amounts incurred by Tenant in resolving such service interruption within thirty (30) days after delivery to Landlord of any invoices or expenses from Tenant and if Landlord shall fail to reimburse Tenant, then Tenant may offset the reimbursements due Tenant against any payment becoming due under this Lease or any other payment obligations under this Lease (provided nothing herein shall limit any other rights and remedies available to Tenant at law, in equity, and/or under this Lease). Landlord shall not be responsible for any electrical current surges, unless any increase is cause by or due to the gross negligence or willful acts or omissions of Landlord, its agents, servants or employees, contractors, or Landlord’s default under this Lease. Landlord reserves the right temporarily to discontinue such utilities and services, or any of them, at such times as may be necessary by reason of accident, repairs, alterations or improvements, strikes, lockouts, riots, acts of God, governmental preemption in connection with a national or local emergency, any law, rule, order or regulation of any governmental agency, conditions of supply and demand which make any product unavailable, Landlord’s compliance with any mandatory governmental energy conservation or environmental protection program, or any voluntary governmental energy conservation program at the request of or with consent or acquiescence of Tenant, or any other happening beyond the control of Landlord. Landlord will not be liable to Tenant or any other person or entity for direct or consequential damages resulting from the admission to or exclusion from the Building or Common Areas of any person. Landlord will not he liable for damages for injury to persons or property or interruption of business for any discontinuance permitted under this Section 8.3(c), nor will such discontinuance in any way be construed as an eviction of Tenant, cause an abatement of Rent, or operate to release Tenant from any of Tenant’s obligations under this Lease, unless such injury, interruption of business or discontinuance of services is caused by or due to the