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Home My WebLink About2009 Resolution No. 077• RESOLUTION NO . f"/'7 SERIES OF 2009 -- • A RESOLUTIO N SUPPORTING A LEASE AGREEMENT BY THE ENGLEWOOD / MCLELLAN RESERVOIR FOUND ATION (EMRF) FOR THE LEASE OF A PORTION OJ' n-lE MCLELLAN PROPERTY TO TT OF DENVER , INC . WHEREAS, the Eng lewood/McLellan Reservoir Fo undat io n (EMRF) was fanned to overs ee the devel opment of the Mclellan Reservoir property ; and WHEREAS, the Lease is fo r eppro ximately 12 .79 ac res of the Englewood/McLellan Reservoir Foundation property; and WHEREAS , City Council reviewed the Lener of Intent and pa ssed Resolution No. 40 , Series of 2008 supporting the negotiation of a lease agreement ; and WHEREAS , the EMRF Board of Directors has unanimously approved th e lea se with TT of Denver, Inc .; NOW, THEREFORE , BE IT RESOLVED BY "!"HE CITY COUNCIL OF THE CITY OF ENGLEWOOD, COLORADO , THAT: ~-The City Council of the City of Englewood, Colorado, hereby supports the "Lease Agreement" between the Englcwood/McLellan Reservoir Foundation and TT of Denve r, Inc. for the lease of a portion of the Mclellan property, attached as Exhibit A. ADOPTED AND APPROVED this 19th day of October, 2009 . James K. Woodward, Mayor I, Lo ucris hia A. Ellis , Ci ty Clerk for J!l~ity of Englewood , above is a true co py of Resolution No . ':.£L_, Series of 200 o, here by ce rtify the • • • GROUND LEASE between IT OF DENVER, INC., as Tenant and ENGLE;WOOD/MCLELLAN RESERVOffi FOUNDATION as Landlord dated as of ____ _ HMM 10/08/09 • TABLE OF CONTENTS Article I Fundamental Lease Term s Article 2 Ground Lea se of Premises 2 I. Defi niti ons 2. Premises 3. Condition of Premises; Tenant Release 4. Improvements 5. Easements Article 3 Lease Term and Conditions Precedent 5 I. Tenn; Effective Date ; Commencement Date 2. Extension Option 3. Tenant's Conditions Precedent, Early Tennination Article 4 Rent 8 I. Constn•ction Rent 2. Base Ri:llt 3. Rent Adjustments • 4 . Net Lease Article S Taxes 10 I. Real Estate Taxes 2. Proration of Taxes 3. Personal Prop erty Taxes Article 6 Utilities 12 I. Utility Usage Article 7 Use, Subletting and Ass "omen, 12 I. Use 2. Assignment and Subletting 3. Recognition Agreement Article 8 [Intentionally Omitted) 13 Article 9 Mechanics Liens 14 I. Liens 2. Protecti on of Landlord's Interest in Premises Article 10 Indemnity and Insurance 14 • I. Indemnity 2. Appear and Defend 3. In surance Article 11 Damage or Destruction 17 18 • Article 12 Eminent Domain I. Definition ofTaking and Substantial Taking 2. Tenant's Rights Upon Taking or Substantial Taking 3. Tenant 's Rights Upon less Than Substantial Taking 4. Rights Upon Temporary Taking 5. Award 19 Article 13 Default I. Events of Tenant's Default 2. Landlord's Remedies 3. Landlord's Default 4. Attorneys' Fees 5. Waiver of Consequential Damages Article 14 Covenant of Quiet Enjoyment 24 Article 15 S1:!,,Q;-dination; Landlord's Right to Mortgage and Convey Premises 24 Article 16 Transfers by Landlord 24 25 Article 17 Miscellaneous 1. Non-Waiver of Default • 2. Recording 3. Notice 4. Successors and Assigns 5. Partial Inv alid it y 6. Interpretation 7. Headings, Captions and Rcforcnce s 8. Governing Law 9. Execution of Documents 10. Force Majeure II. Reasonable Consent 12 . Authority 13 . Estoppel Certificate 14. Holding Over Article 18 Leasehold Financing 27 I. Mortgage by Tenant 2. Notice To and Rights of Leasehold Mortgagees Article 19 Representations of Landlord and Tenant 30 I. Representati ons of Landlord 2. Representations of Tenant Article 20 Right of First Offer 34 • Exhibit A-1 Legal Description of Premises A-1 -ii- • • • Exhibit A-2 Exhibit B Exhibit C Site Pl an of Premi ses Ex ceptions to Title Memorandum of Le ase A-2 B-1 C-1 • • • HMM 10 /8 /09 GROUND LEASE This GROUND LEASE (the "Lease") is made as of the __ day of ___ __, 200 , by and between ENGLEWOOD/MCLELLAN RESERVOIR FOUNDATION , a Colorado nonprofit corporati on ("Landlord "), and TT of DENVER, INC. ("Te nant"). The date this Lease ts exec utro and deli vered by both parties hereto shall be referred to hereinafter as the "Effective Date." WITNESSETH: For and in consideration of the mutual covenants here in conta ined and other goo d and val uable cons id eration , the recei pt and suffi ciency of which are hereby acknowledged, the parties hereto agree to the terms and co nditions as hereinafter provided : Article 1 Fundamenta l Lease Terms For conveni ence , this Article 1 summarizes certain fundamental economic and business term s of this Lease . Effective Date : 2009 Premises: That certain real property described on Exhibit A attached hereto and incorporated herein by this referen ce, consis ting of approxima tel y 12.79 acres at the Northwest corner ofC-470 and Luc en t Bou lev ard, Highlands Ranch , CO. Landlord ENGLEWOOD/MCLELLAN RESERVOIR FOUNDATION 1000 Englewood Parkway Englewood , Colorado 80 I 10 Attention: President Tenant TT of Denver, Inc. 5077 South Wadsworth Boulevard Littleton, Co lorad o 80 I 23 Attention : Michael Ward Guarantor: Michael Ward 5077 South Wadsworth Boulevard Littleton , Colorado 80 123 Term: Twenty (20) years from the Commencement Date Option: One ( 1) renewal op ti on of ten ( I 0) years and thereafter nine (9) renewal options of fi ve (5) years each I Rent: Pre-Devlopment Rent of$ I 0,00 0 per month , co mmencing up on exec ution of lease and continuing until the start of Construction rent as pro vided in Section 3.3 .A. Annual amount of$214,496, as Cons tructirn Rent commencing as prov ided in Article 4. Annual amount of $428,992 as Base Rent commencing as provided in Article 4, increased ten percent (I 0%) every five (5) years during the Initial Term and First Extension Option , and thereafter adjusted with the Consumer Price Index every five (5) years as provided in Article 4. This is a Net Lease. Deposit $200,000, as provided in Section 4.5 Article 2 Gro und Lease of Pre mises I. Definiti ons . For purposes of thi s Lease, the following terms shall have the following meanings: A. "Adjustment Date" shall have the meaning set forth in Article 4.3 .D. B. "A pproval Period " shall hcve the meanin g set forth in ,.,ticle 3.3.F. C. "Approved Sublease" shall have the meaning set forth in Article 7.3. D. "Assessments" shall have the meaning set forth in Article 19 .1.K. E. "Base Rent " shall have the meaning set forth in Article 4.1. F. "Base Rent Start Date" shall liave the meaning set forth in Arti cle 4.1. G. "Buildings" shal! '.nean the buildings which may be constructed by the Ten ant on tr.~ Prem ises. H. "Casualty" shall have the meaning set forth in Article 11 .1. I. "Commencement Date" shall have the meaning ~et forth in Article 3.1 . J . "Construction Rent" shall be the monthly amount of$) 7,875 as provided in Article 4.1. K. "Default " or "Eve nt of Default " shall have the meaning set forth in Article 13 .1. 2 • • • • • • L. "Default Rat e" shall me an interest acc ruin g at th e rate equ al to th e Prime Rate plu s three percent (3%), which rat e shall be adju sted with ,:ach chan ge in th e Prime Rate . However, in no even t shall th e Defa ult Rate be less limn ten percent ( I 0%) per annum .. -0r purp oses of thi s Lease , "Prime Rate" shall mean the prime rate as pu':>li shed in the Walt Street Journ al. If the prime rate publi sherl by th e Wall Street Journal becomes una vai lable, Landlord shall use the prime rat e as announ ce or publi shed by such other organi zatio n or publication as reaso nabl y determined by Landlord to be co mparabl e to the prime rate now publi shed in th e Wall Street Journ al.. M. "Depo sit" shall mean the sum of$200,000 which Tenant ha s deposited in escrow with Security Title Guaranty Company, together \\~th interest acc rued thereon. N. "Effective Date " shall mean the date thi s Lease is signed by both Parties. 0. "Environmental Law" shall have the meaning set forth in Section 19 .1.J . P. "Ex cusable Dela y" shall mean any of the following events that pre vents, delays , retards or hinders a party's perfonnance of its duties hereunder: ~ct of God ; fire ; earthquake; flood; explosion ; war; invasion; insurrection ; riot ; mob violence; sabotage ; vandalism; inability to proc ure or general shortage oflabor, equipment, facilities, materials or supplies in the open market; failure of transportation ; strikes; lockouts ; any material delay caused by Landlord without fault of Tenant ; or any delays due to causes beyond the control of Landlord and without its fault or negligen ce . Q. "First Exten sion Option" shall have the meaning set forth in Article 3.2. R. "Improvements" shall mean th e Buildin gs and any other improvements co nstructed on the Premi ses . S. "Initial Term " shall mean the fir st 20 Lease Years as more spec ificall y described in Article 3.1. T. "Landlord" is Englewood/McLellan Reservo ir Foundatior,. U. "Leasehold Mortgage" shall have the meaning set forth in Article 18. V. "Leasehold Mortgagee ' sha ll have the meaning set forth in Article 18 . W. "Lease Year'· shall have the meani ng set fo rth in Article 3.1. X. "Memorandum of Le ase" shall have th e meaning set forth in Article 17 .2. Y. "Monetary Default" shall have the meaning se t forth in Article 13 .1. Z. "Non-Monetary Default" shall have the meaning set forth in Article 13 .1 . AA. "Perm itted Exception ~" shal l have the meaning set forth in Article 3.3.H . BB . "Pre-Development Rent" sha ll have the me aning set forth in Article 3.3 .A. CC. "Premises" shall have the meaning set fort h in Article 2.2.A. DD . "Real Estate Taxes" sha ll mean all taxes , however named , assessed , le vied, or co llected, whether on an ad valo rem basis or other taxing method on the Premises , Impro vements , Buildings , and asses sments for land , betterment s, and improvements that are levied or assessed on the Premises or the lmp rovemcn ts by any lawfu l authority, as finally determined in accordance with law, net of any applicable abatements, refunds, or rebates .. EE . "Rent" shall mean the ar -ount se 1 forth in Article 4. FF . "Site Plan" as referred to .l Arti cl-.2 .2.A and attachr.d hereto as Exhlhit GG. "S uitability Period" shall mean the period expiring January 31, 2010 as provided in Article 3.3.D . HH . "Tenant" 1s TT of Denver, Inc., and its p~rmitted successo rs or assigns. II . "Title Commitment shall have the meaning se-for ·~. in ~ .• :icle 3.3.H JJ . "T itl e Company" shall mean Security Title Guaw ,,ty r,.,,, .pany as agent fu Fidelity National Title In su rance Company , or such other tid~ company mutually a~·ecd upon by Landlord and Tenant. A. Leas e of Premises. For th e term , uses, rent, and in consideration of the covenants and agreements contained herein, and for other valuable consideration, Landlord hereby leases to Tenant and Tenant hereby leases from Landlord, upon the following terms, stipulations, provi sions , and conditions, that certain real property consisting of approximately 12. 79 acres at the northwest comer of the intersection of Highway 470 and Lucent Boulevard, located near Highlan s Ranch , Colorado, more particularly described in Exhibit A-1 attached hereto and incorporated herein by this reference ("Premi ses"). The location of the Premises is shown on Exhibit A-2 hereto (the "Site Plan"), B. Title. Landlord hereby warrants to Tenant that it has good, marketable and insurable title to the Premi ses, free and clear of any mortgages , pledges, liens , and othe r encumbrances, subject only to the Permitted Exce ptions . 3. Condition of Premises: Tenant Release. Except as otherwise expressly provide<! • • herein, the Premises are being leased in their as-is condition. Except for Landlords representations and warranties expressly set forth in this Lease, Tenant hereby waives, releases, • acq uit s ,11d forever discharges Landlord and its officers , directors , shareholders, employees, 4 • age nt s, succe sso rs and ass ign s, of and fro m an y and all suit s, ca uses of action , claim s, dema nd s, dam ages (a ctual and puniti ve), loss es , cos ts, li abilitie s, and expenses , includin g attorneys' fees , of an y kind or nature , in law or in equi ty, know n or unkn ow n, wlli ch Tenant shall or ma y have or acquire or possess in an y way directl y or indir ec tly connected wi th , ba sed upon, or arising out of Landlord 's use, maintenance, leas ing, ownership , operation , and demolition of impro vement s upon th e Premi ses pri or to the Effecti ve Date of thi s Lease; or (i,) the co ndition (including en,~ronmental co nditi on and stru ctural fitne ss), status , quality, or nature of the Premi ses . Except as otherw is e exp ressly provided herein , it is th e intention of this Lease that any and all re sponsibilities and obligations of Landlord , and any and all rights or claims of Tenant against Landlord its successors and assigns and affiliates , ari sing "> virtu e of the physi cal condition of the Premi ses, are by this release declared null and void e111l of no prese nt or future effect as to such parties. • • 4. Impro vements . Tenant, at its so le cost aud expens e, with its own force s or th ose of its contractors, may construct Improvement s on th e r n•rnises. All of the Improvements shall comply in all respects wi th all applicable govemmental re,1uirements. Landlord acicnowledges that Tenant may sublease portions of the Premi ses to subtt:11 0,,ts to th e extent pennitted hereunder, who may construct their own Improvements . However, the partjes agree th at notwith stan ding such arrangements , Tenant shall remain responsible to Landlord to satis fy the obligations of Tenant under the Lease with respect to such portions of the Premises. 5. Easements . Land lord and Tenant agree, upon the reasonable request of either part y to thi s Lease, th e applicab le governmental agency, or a public utility, to execute documentJ which are reasonab ly required to create utiF.ty easements , temporary construction easements , or other easements required to r,onstruct the Improvements, maintai n and serv ice the Improvements or any other impro vements to be developed on the adjoining lands own ,d by La;:dlord, pro~ded such easement s do not unreasona bly interfere with either party's use oft 1eir property . Each party will unde.rtake to obt ai n the co nsent of its mortgagee, if any, to any easement s required under this paragraph. 6. Possession. Landlord shall deliver po ss es sion of the Premi ses to Tenant on the Commencemen t Date (as herein after defined). Article 3 Lease Term and Conditions Precedent I. Term : Effectiv e Date; Commencement Date . This Lease shall become legally binding on the Effective Date . However, th e lease term ("I nitial Term ") shall commence on th e earlier of I) the date Tenant commen ces co nstruction of the Impro vements , or 2) June 1, 20 1 O; such date shall be the "Commencement Date ." For purposes of thi s Lease , "evmmences construction" shall mean the date when Tenant begin s co nstruction of the foundation for an y Improvements . Unless extended as provided below , the Initial Term shall expire at I I :59 p.m. on th e las t day of the calendar month of the twentieth (20th) year Lease Year . For purposes of this Lease , the tenn "Lease Year" shall mean each twelve (12) month period beginning on th e first day of the ca lendar month subsr,quent to the commencement of the Ini tial Tenn if the Initi al Term do es not co mm ence on the fir st day of a ca lendar month . 2. Extension Option . Tenant sha ll have an op ti on to extend the lease tenn for an • additional ten (10) years ("First Extension Op tion "). if the First Extension Option is exercised, Tenant shall have an optiue to extend the lease for nine additio nal consecutive tenns , each co nsisting of five (5) years. The First Ex tensio n Option and each additio nal extension option shall be on the same tenns and conditions as set forth he.rei n (there shall be no optio ns beyond the options granted in this Section 2), except th e Base Rent at the commencem en t of the First Ex tension Option, and at the first day of the twenly sixth (26th) Lease Year, shall be increased by I 0% of th e Base Rent app li cab le to the year imm ed iat ily preceding the increa se. The rent during each of the addi ti onal five (5) year options shall be adj.isled at the commencement o f each additio nal option period for increases in the Consumer l'iice index as provi ded in Article 4.2 . Tenant shall hive the right to exercise its options by pro, 'din g Landlord written notice exercising its optio n to extend not less than one hundred e1;,Jity (180) days prior to the expiration of the then current tenn . As a condition of Tenant right to e,ercise one or more options to extend the tem1 , at the time of the giving of its notice of exercise th·~e shal l be no 1,ncured Event of Default. 3. Co nditi ons Precedent, Early Termination. A. Non-refu~dahle monthly payments. Upon mutual execution of this Lease, Tenant sha ll pay to Landlord an initial payment of I 0,000. Thereafter, Tenant shall pay Landlord an additional payment of$ I 0,000 each month (the initial$ I 0,000 payment and all additional monthly$ I 0,000 payments made under terms of this Paragraph A arc herein referred to as th e "Pre-Development Rent"). Payment of P,·e- Development Rent shall continu e until thi s Lease is tenninated or the commencement of Cons tru ction Rent. Except as expressly pro vided below in this Paragraph, all Pre- Development Rent shall be non-refundable and shall be the sole property of Landlord , free of any claim by Tenant ; provided however, in the even this Lease has not previously terminated, upon payment of the fir st monthly Co nstruction Rent payment, all Pre-De vdopmen t Rent shall be applied to Construction Rent. In th e event Tenant fails to make any monthly Pre -Development Rent payment when due, and such failure conti nues for ten (I 0) days following written notice from Landlord, this Lease shall be dee med term inated without further notice to Tenant, and Landlord shall have the right to rc:ain, free of any claim of Tenant, all Pre-Development Rent paid prior \o such tcnnin atio n. Landlord acknowledges and agrees that the Pre-Development Rent shall be refundable to Tenant and this Lease ~hall terminate upon the occu rrence, and only upon such occurrence of the followit. g events prior to the Commencement Date : (i) a Taking of Subs tanti ally All of the Premises as provided in Article 12, (ii) Tenant 's ele ction to terminate this lease as a result ofan uncured default by Landlord as provided in Secti0n 13 .3, (iii) Tenant's election to termit'ate this Lea se as a resu lt of Landlord's fail ure to cure a title defect as permitted under the provisions of Sectio n 3.3.H an d the occurrence of a violation of an applicab le Env ironmental Law re sultin g from an environmental co ndition of the Premises aris ing sub seq uent to th e Effective Dat e. B. Tenant's Right of Entry . Tenant, its agents, employees, contractors, or sub contractors, prospecti ve lend c-s and inves tors ma y, upon reasonable not ice to Landlord, at all times after the date her wf, and until th e earlier of the commencement of th e Initial Term or the termination of this Lease , have the right of 6 • • • • • access to the Premises to test, inspect, and evaluate the Premises as Tenant deems appropriat e, including without limitation drilling, sampling or other testing procedures, and a Phase I Environmental Audit and any subsequent emironmental testing required or recommended from such audit. Tenant shall promptly rest ore any alterations made to the Premises by Tenant, or at Tenant's instance or request, and Tenant shall pay for all work perfo11I1ed by Tenant, or at Tenant's instance or request Any and all liens on any portion of the Premises resulting from the actions or requests or otherwi se at the instance of Tenant shall be removed by Tenant at its expense within thirty (30) days after notice thereof is given to Tenant Tenant shall, at Tenant's expense, defend, indemnify, and bold harmless Landlord from and against any and all obligations , claims , loss , and damage, including costs and attorneys' fees, to the extent the same are caused by ''enant's entry upon or inspection of the Premises . Tenant shall provide Landlord in a commercially reasonable timeframe with copies oftest and reports obtained by Tenant during the Suitability Period and Approval Period. Tenant's obligations under this subsection to restore, to pay for all work, to remove liens, and to defend indemnify and bold Landlord bannless shall survive the termination of this Lease. C. Landlord De)jyeries . Landlord represents to Tenant that Landlord bas prior to the Effective Date delivered to Tenant .copies of all surveys and reports in Landlord's possession and pertaining to the Premises including but not limited to all engineering, environmental , and soils reports . D. Sujtabi)jty Period. Tenant sball have until 5:00 P.M on January 31, 2010 ("SqltabWty Period") to inspect and evaluate the Pnmises to determine its suitaliility for Tenant's intended use. Tenant may, for any reason and in its sole discretion, terminate this Lease by written notice to Landlord given on or before the last day of the Suitability Period. In the event Tenant delivers the termination notice, during the Suitability Period, the Pre-Development Rent due and payable prior to the tellilination notice shall be retained by the Landlord, and any remaining portion of the Deposit, including ·accrued interest, shall be paid to Tenant Upon Tenant giving such tellilination notice, and except to the extent Tenant's obligations survive as provided above in subsection 3 .B, this Lease shall terminate and be of no further force and effect and each party shall be relieved of all further obligations hereunder. If Tenant does not deliver to Landlord written notice oftCllilination resulting from its inspection prior to the expiration of the Suitability Period, Tenant shall be deemed to have waived its right of termination under this Paragraph D, and this Lease shall continue in full force and effect. E. ~-Tenant shall have until June I , 2010 to obtain financing for di;vdopment of the Premises or a portion thereof as an automobile dealership . In the event Tenant fails to obtain such financing on terms and conditions reasonably satisfactory to Tenant by June l, 2010, Tenant shall have the right to terminate this Lease by giving Landlord written notice of such termination on or prior to June I, 2010, and such notice shall include a certification by Mike Ward that Tenant was unable to obtain such financing. In the event Tenant delivers the termination notice under the terms of this Paragraph E, the Pre-Development Rent due and payable prior to the termination notice shall be retained by the Landlord, and any remaining portion of the 7 Depos it, including accrued interest , shall be paid to Tenant. Upo n Tenant givin g its • noti ce of tenninati on of this Lease for fail ure to ob tain sucl t fin:::i cing as provid ed in this paragraph , except to the extent Tenant 's obligations survive as provi ded above in sub section 3.8 , each party shall be relieved of all furth er obligatio ns hereunder. If Te nant does no t deliver to La ndl ord wri tt en no ti ce often ,i matio n as provid ed in thi s Paragraph on or before Jun e I , 20 I 0, Tenan t shall be dc ,:.;icd to have waived it s right of tennin ati on under thi s Para1,'l'aph E, and thi s Lease shall continue in full force and effec t. F. Approval Period. Te nant shall have until 5:0 0 P.M . on June I , 2010 ("Approval Period "), subj ec t to extension as hereinafter provide , in which to obtain at its so le cost the agreements , and go vernmental approvals , including bid ding pennits, which are necessary for Tenant's propo sed development of the Prerni 5c-s as a first-class lnfiniti new car dealership . Tenant shal l submit its application for all necessary permit s together with all supporting documentation required in connection with such application in a timely manner; and thereafter Tenant shall diliger tly pursue such applications with commerciall y reaso nable effort and diligen ce 10 i,htai ,, ,ssuance of all such permits. During the Approval Peri od, Tenant shall pre , ic; :. i... j)o.rd written reports as to its progress and th e status of rezoning and ap plicati Oh, IN approvals required by Tenant fo r its intended development of the Premi ses and such other infonn ation which Tenant reasonably detennin es is relevant to Landl ord about the Prem ises. In the event Tenant is unabl e to ol:tain an y agreem ent or approval reasonably accep table to Tenant and necessary fo r its development of the Premises , Tenant ma y termin ate this L~ase by wri tten notice to Llnd lord , specifying th e agreement or approval Tenant failed to obtain , • given on or before the last day of th e Approval Period . In the event Ten ant delivers the descri bed tennination notice during th e Approval Period , the Pre-De velopm ent Rent due and paya ble pri or to the tenn iration notice sha ll be retained by the Landlord, and any remaining porti on of the Deposit , in cluding accrued interest, shall be paid to Tenant. Upon Tenant 1,~ving such tennination notice , and except to the extent Tenant's ob li gat ions survi ve as provided above in sub secti on 3.8 , this Lease shall termin ate and be of no further fo rce and effect an d each party shall be re lieved of all further obli gations hereund er. If T enant does not deliver to Landlord a termination notice pri or to the ex piration of the Approval Period , Tenant sha ll be deemed to have waived its right oftennination under thi s Paragra ph F, and thi s Lease shall continue in full force and effect. G. flntentionally Delet ed ). H. Within 10 days fo ll owing mutu al exec uti on of this Lease, Land lord shall furnish to Ten ant a title commitment for a leaseho ld ti tl e policy covering th e Prem ises (the "Title Commitment") iss ued by the Title Com pany, with said commitm en t to insure, subj ect to the requirements and excep ti ons set forth therein, a lease hold estate in th e Premi ses in Tenant in the amount of $5 ,228,000 . La ndl ord shall ca use th e Title Co mpany to furn ish Tenant co pi es of all recorded in struments referred to in the Ti tl e Commitment. Landlord shall cause th e Title Co mpan y to issue to Tenant, within th irty days following the expiration of th e Approval Period m1 ALTA leasehold titl e insurance • policy insuring Tenant's lea sehold estate in the Premi ses, subj ect onl y to the Pennitted Excep tions. Landlord shall pay th e cos t of th e leaseho ld ti tl e insurance poli cy, and shall • • • have th e right 10 use a portion of the Depo sit to make such payment. Landlord shall also cooperate with Tenant , at Tenant 's expen se, in obtaining a simultaneous iss uance of a Lender 's Policy for Tenant 's mortgagee, and if desired by Tenan t, a leasehold poli cy for Tenant in excess of$5 ,228 ,000 to take into acco unt the improvements to be co nstructed . Tenant shall pay the premium fo r any coverage in excess ofSS,228,000 for the leaseho ld policy, and shall als o pay the cost of the Lender 's Poli cy, based cm r. simultaneous iss ue rate, if avail ab le . In the event Tenant wants an updaterl si.:v ey, it shall be re spo nsible for doing so and Landlord shal l reimburse Ten ent for th e cos t, up to a maximum of $5 ,000 , by crediting such amount against the first r ental payment due . The Permitted Exceptions shall not include stan dard printed exceptions I through : on Schedule 8-2 of th e Title Commitment, and Landlorr. shall cooperate on obt,inmg th e deletion of such except ions , including the execution of an indemnification and ai 1davit in fonn reasonably satisfactory to Landlord . On or before DecerP.her I , 2009 , Ten ant shall give Landlord noti ce of all title defects shown in the Title Commitment which are not consented to by Tenant as Permitted Exceptions. Tenant ackn owledges and agrees that it has reviewed and approved th e exceptions to title set fo ct~ nn Exibit B atl":'>e,J here,o , and suc h exceptions, together with any and all other m. ~·s affecti ng all or any porti on of the Premises disclosed by the Title Commitment (as ax ceptions, requirements , or otheiwise) which are not the subject of a timel y notice from Tenant to Landlord shall be deemed accepted by Tenant ar,d are herein referred to as the "Permitted Exceptions". If Tenant noti fies Landlord of any title or survey defects to which it objects, then within twenty (20) days after Landlord receives such title or survey objection notice , Landlord shall ad vise Tenant what, if anything, it will do to address the obj ection . Landlord shall use reasonable efforts to cure any title <'bjections , provided , however, in th e event the cost lo cure such objection exceeds the sum of $5 ,000 , Landlord shall have the option of declinin g to cure such objection. If Landlord notifies Tenant prior lo th e end of the Suitability Period that it is not able to rea sonab ly cure each defect objected to , or that the co st of such C\lre exceeds $5 ,000 and Landlord decli.t ,~s tu cure such objectio n, Ter.ant may, by wri tten notice to Landlord, tenninate this Agre~ment and obta in a full refund of any Deposit , or, if it fails ·., give such notice, Tenant shall be deemed to have waived such defects and shal l accept the same as Permitted Exception s. The notice of tennin ati on shall be given no later than (i) twenty (20) days following the notice that Landlord will not cure any defect. If Tenant does not notify Landlord of its deci sion to tenninate or waive within th e time required , Tenant shall be deemed to have waived its objectio n lo such defects and to have accepted such defects as Perm it! Exception s. In the event Landlord notifies Tenant that it will cure a 1itl1; objection , and thereafter fai ls to do so, Tenant by written notice to Landlord no later than sixty (60 ) days fo llowing Landlord's notification that it will cure , may termin ate thi s Agreement and obtain a full refund of any Deposit, or, if it fails to give such notice , Tenant shall be deemed to have wa ived such defects and shall accept th e sam e as Permitted Exceptions . In the event ofa termination of this Lease by Tenant pu rs uant to thi s subparagraph , the Dc posil shall paid to Tenant and both parties shall thereu po n be relie ved of all further ()b !i gation s. Notw ith standing any other provision to the co ntrary, Landlord agrees to pay in full and dischr.rge any lien secu rin g a monetary indebtedness incurred by Landlord. I. In the event the Tenant defaults (a fter th e expiration of any ap pli,,able • notice and cure period) under the terms of this Lease prior to the Commencement Date , the Depos it shall be paid to Landlord as liquidated damages . Pro vid ed Tenan t is no t then in default hereunder , the Depos it shall be paid to Landl ord upon th e Co mmen cement Date an d shall be applied to th e Base Rent. Article 4 Rent I . Constructi on Rent. Tenant shall pay to Landlord , in United States Dollars, rent ("Construction Rent ") in the annual am ount of$214 ,496 (bas'!<! on $0 .385 per square foo t a:;d 12.79 acres), payabl e monthly in the amount of $17 ,875 . Con striction Rent shall be payable in equal monthly installments, commenci'!g on the Commencement Date, and continuing until the "Base Rent Start Date, as hereinafter defined . The "Base Rent Start Date " shall be the earlier of (i) the date Tenant opens for business to the public on th e L1111d or (ii) April I , 201 1. Commencing on the Base Rent Start Date, Tenant shall pay rent ("B ase Rent") in the annual initial amount of seventy nine cents ($0.77) per square foot of the Land as certified on the Survey (being appro ximately $428,992), in equal monthly installments . Construction Rent an d Base Ren t shal l b e payable in advance on the first day of each calend ar month , with appropriate proration for an y partial calendar month er Lease Year, at the addr ess giv<:n for Landl ord in Paragraph 31 hereof, unl ess and until thirty (30) day s after Landl o:·d give ; Tenant written noti ce of a change of address or of the party or parties (but not more th an two parties) to whom such rents shall be payable . 2. Base Rent. Ten ant shall pay to Lan dl ord , in Uni ted States Doll ars, beginning on the Bas e Rent St art Date, Base Rent in the annual amount of$428 ,992 (based on $0 .77 per square foot and 12.79 acre s), payable monthly in th e amount of $35,7 49 . Ba se Rent shall be paya ble in monthly installments , in advance on the fir st day of each ca lendar mo nth , with appropriate prorati on for any partial calendar month or Lease Year, at the ad dres s given for Landl ord in Article 17 hereof, as such address may be change c! n :,·:co; done,: wi th Article 17,. The Base Rent shal l be adjusted as provided in Paragraph 3 of thi s Article 4. Land lord shall apply the Deposit (including accruei. interest), including the amount app!1ed to the cost of the Title Poli cy as provided in Article 3.3 .H, first to the Co nstruction Rent and any excess to the Base Rent. 3. R cnt Adju stment s. A. Base Rent shall be adjusted during th e Initi al Term as fo llows : i. LeaseYear6 thru 10-annualrentof $47 1,89 1. ii. Lease year 11 thru 15-annual rent of $519 ,080. iii. Lease Year 16 thru 20-annual rent of $570 ,988. B. In the event Tenant exerci ses the First Option the rent shall be : i. Leas e Year 2 1 thru 25-annu al rent of$628,087. 10 • • • • • ii. Lea se Y car 26 thru 30-annu al rent of $69 0 ,89 6. C. In the event Tenant exerci ses one or mor e additi onal opti ons, th e rent shall be adju sted effe ctive on the first day of each additi onal opti on peri od, (in each case , the "Adjustment Date"). On the first Adjustment Dat e, being the fir st day of Lea se Year 31 , the Base Rent shall be increas ed by an amount equ al to th e l·••.-.cnta ge in creas e in th e CPI Index (a s defined below) from th e Co mm encement Date of thi s Lease to the current Adju stment Dat e, but in 11 :., r vrpl shall the Ban· r. ·.,n t,-_.~;;,ni11 .i; ihc fir st da y of Lease Year 3 I (i) be less than the Bas e Rent for Li e pr:.,d ,n1 ~~.a., Year, nor (ii) more than thirty percent (30 %) more than the Base Rent for th r; ;•'c" ,1t ng L.case Year. On each additional Adjustment Date, the Base Rent shall be incrr.a,;eo y a,, amount equal to the increase in the CPI Ind ex from the commencement of im mediscel y preceding option period; µrovided, however, in no event shall the increast sub sequent to the first Adjustment Date be more than twenty percent (20%) of annual rent for the year immediately preceding such adjustment. D. As use herein, the CPI Index shall mean : i The Consumer Price Index for all Urban Consumers Denver, Boulder, Metro Area -All Items Index (CPI-U , I 982-84 equals 100), published by the United States Department of Labor , Bureau of Labor Statistics. If the CPI Index is published with numbers issued other than on a monthly basis , the CPI Index shall be the CPI Index number published for the date closest to th e Commencement Date or the applicable Adjustment Date . ii. If the CPI Index is discontinued, the CPI Index adjustment shall be made using comparable statistics on the cost of li ving for the Denver, Boulder metropolitan area as computed and published by ~y agency of the United States Government or by a responsible financial periodical or recognized authority selected in the reasonable discretion of Landlord . 4. Net Lease . This Lease is a net lease. Except as may be expressly provided otherwi se ir this Lease , all costs in curred in co nnection with the construction , operation , maintenan ce and lea sing of the Improvements and all costs incurred in connection with and in relati on to the Premi ses shall be paid by Tenant. Landlord shall have no o bligation to make an y rep airs , replacem ents or renewals of any kind , nature or description whatsoever to the Improvement s or th e Premi ses. 5. Security Depos it. Simultaneou sly with the execution of this Lease by Landlord and Tenant , Tenant shall del iver to Security Title Guaranty Company, as Escrow Agent , the Dep os it (as defined in Section 1.1 .N), and Escrow Agent shall invest th e Deposit in an interest bearing account. Esc row Agent , upon receipt of the escrow fund s, shall pa y to Landlord th e Pre- II Devel opment Rent fo r th e current month , and sha ll co nt inu e si.ch m nthly paymen ts until the • fir ;t paym ent of Construction Rent is due (after app lying the cret!lt for all Pre-Development Rent ). Thereafter, escrow agent shal l con tinu e to pa y to th e Land i,,•d the Construction Rent until such time as the escrow fund , including accru ed interest is exha usted . In the event Tenant defaults under the terms of this Lease , the balance of the escrow fund, incl ud ing accrued interes t shall be paid to Landlord, to apply against any and all amount s due as a re sult of such defattlt, in cluding any damages , anomeys' fee s or other co sts du e Landl ord. I. Real Estate Taxes . Article 5 Taxes A. During the term of this Lease , Tenant shalJ as sume, pay, bear, and discharge any and all Real Estate Taxes with respect to th e Premis es, or any part thereof, and all other taxes in any manner applicable to or assessed against the Premises or Buildings or any part thereof, or against any of the machinery , fixtures, equipment, or other property or items . Tenan t shall pay all Real Estate Taxes directly to the taxing authorities and Tenant shall be credited all reimbursements on acco unt of abatements, refunds, or rebates of Rea l Estate Taxes during the term of this Lease . Landlo rd hereb y auth orizes Tenant to file and purs ue any protest of the va luation of the Premises an d abatement petitions fo r abatement of taxes for any reason , as Tenant may deem to be appropriate, Landlord agrees to execute any form of agreement as may be necessary in • connection therewith . B. In the event the Premises are now included in a larger tax parce l owned by Landlord , Landlord shall take such action s as may be necessary to make the Premi ses a separate Tax Parcel. Tenant shall cooperate wit h Landlord in such action . C. In the event there is a specia l a! .es sment which is included within the definiti on of Real Estate Taxes herein, and such as sessment may be paid in periodic installments, Tenant sh all pay such in such periodic installments or may prepay or retire the principal indebtedn ess on any special assessment and T tmant shall be responsible only for those installments relating to the peri od included within the term of this Lease, based upon the maximum number of installments in which the same may be paid. In the event of any proposed special assessment would provide for payment extend in g beyond the term of this Lease (excluding and extension period), unless Tenant agrees to pay for all of such assessment, Landlord sha ll have the right to participate in the proces s of approving or rejecting such assessment. D. Landlord shall cooperate with Tenant so that all invoi r.es fo r Real Estate Taxes shall be sent directly by the taxing authority to Tenant. E. Landlord agrees to submit to Tenant any invoices for Real Estate Taxes and notices of special assessments wi th respect to the Premises which are sent to Landlord within thirty (30) days after receipt by Landlord . Landlord shall furnish • Tenant with copies of all Notices of Valuation of the Premises whi ch are sent to 12 • • • Landlord within te n (10) day s after receipt thereof and in suffi cient ti me to all ow Tenant to determin e whether or not to co nt est any in crease in Rea l Esta te Taxes or val uat ion. If Tenant de si res to contest such increase, Tenant shall protest such va lu ation or fi le an abatement petiti on within ap pli cable statutory time periods. Landlord shall fully cooperat e witl1 Tenant in any such proc ee ding . 2. Prorati on of Taxes . If the T, rm shall ex pire on any dat e other th an Decemb er 3 I st of an y year, th e amoun t payab le by Tenant during th e calend ar year in which such termin ation occ urs sha ll be prorat ed on th e basis which th e number of days from tl1e commencement of said tax fi scal year to and includin g sa id term ination date bears to 365. A similar proration shall be made fo r th e tax fiscal year in whi ch th e Term commences. 3. Personal Prop ertv Taxes. Tenan t shall pa y all taxes charged agai nst trade fixtures , furni shings , equipment or any oth er personal pro perty belonging to Tenant. Lessee may co ntest any such personal property taxes, assessments or val uati ons; pro vided, how ever, Tenan t shal l do so withi n tl1 e time peri od permitted by appli ca ble statutes. Article 6 Utilities 1. Utility Usa ge . Tenan t shall assume, bear, pay, and discharge as its so le and se parate ob li ga tio all of the applicable charges for all utilities consumed on th e Premises . Except in the event of an emergency, neith er Landl ord nor Tenant shall take any action which shall interrupt or interfere wi th any electric, 6as , wa ter, sewage , or telephone service to th e Premi ses or to the adjo ining property owned by Landlord. Article 7 Use, Subletting, and Ass ignment I . Use. Tenant may use and occupy the Prem ises during th e Term of the Lea se for all law ful uses in acco rd ance wi th th e req uirement s of th is Lease. 2. Assignment and Subletting. A. Tenant shall ha ve tl,e right to sublet al l or any part of th e Prem ises or ass ign this Lease up on Landl ord 's prior wri tt en co nse nt which shall not be unreaso nabl y withhe ld . In the eve nt Tenant ass igns thi s Lease in connection with the sa le of its aut omobile dealership bu sin ess, Land lord 's co nse nt to such ass ib'llme,,. slid ll not be required pro vi ded I) no un cured Event of Defa ult th en exists , and no event has occ urred whic h, with th e passage oftim e or th e giving of noti ce , would constit ute an Event of Default, 2) tl1 e ass ign ee has been npproved by lnfiniti or the applicable automobile man ufactu rer granting the dealers hip right s to the assignee, and th e assignment otherwi se compli es with tl,e provi sions of th is subparagraph 2. In th e event La ndl ord fails to respo nd to a req ue st to co nsent to an ass ignm ent within thirty (30) days fo llowin g receipt of a written request for such co nsent , Landlord shall be deemed to have given its co nsent. B. In the eve nt (i) Tenant subleases part or all of the Premi ses , (ii ) such subl ease does not in clud e any buildin g(s) on the Pr emi ses or a req uirement ihat Tenant 13 construct any building(s) with the cost to be included in the rent and such porti on of th e rent is not separately identifiable from the rent for the vacant land only, and (iii) the rent or oth er consideration payable und er such suble ase wi th respect to the vacan t land is 1,oreater th an the Base Rent due hereunder, then Tenant shall pa y to Landlord one half (1/2) of such exc es s amou nt , after first re covering Tenant's Tran sacti on Costs as hereinafter provided . Any excess amou nt pa yab le to Land lord shall be pa ya ble from time to lime only as when Tenant receives the rent fi-om it s sub-t en•nt. If Tenant ass igns thi s Lease, and ther e are no buildings on the Premises at th e time of such assignme nt , and Tenant receives compensat ion in addition to the ass ign ee's agreement to make the payments due under thi s Lease, Tenant sha ll pay to Landlord one half (1 /2) of such compe nsation . In ca lculating any excess rent or compensation for an assignment under this Paragraph B, Tenant shall first be reimbursed for its costs ("Tenant's Transaction Cos ts") in connection with such sublease or ass ignment and the Premises covered thereunder, including but not limited to any site work, any approvals obtained from governmental agencies, and engineering or survey work, any development fees paid to any governmental agency and any commis sions or marketing costs. If such costs relate to both a porti on of the Premises which is subject to Landlord's right to payment under thi s Paragr aph Band also to other portion s of the Premises , the costs shall be equ itabl y apportioned. Notwithstanding anything contained herei n to the contrary, in no event shall Tenant h~ve any obligation to make any payment to Landlord for the first sublease of portions of the Premises entered into by Tenant on or before December 31 , 2014. C. Any assi1,'llment or subletting shall be effective on ly upon delivery to Landlord ofan instrument effecting an assignment or subletting of this Lease by Tenant , executed by Tenant and the assignee or sub lessee. Each assi1,'llee sha ll agree to assume, be bound by , and perform all tenns, cove nants, and cond itions of thi s Lease to be kept and perfonned by Tenant and which arise after th e effective date of the assignment. Aller execution of the ass ignment or sublease, Tenant wi ll forward a com pleted co py thereof to Landlord. D. In the event T .nt subleases or assigns this Lease , Tenant shall remain li ab le for all of Tenant's obligations to Landlord arising hereunder, unless, with regard to an assignment of this Lease, the assi1,'llee or a substitute guarantor has a net worth of not less than Six Million Dollars ($6,000,000), including un enc umbered liquid assets of not le ss than One Million Doll ars ($1 ,000,000), or unle ss Landlord otherwise consents in writing to a release of Tenant, which co nsent shall be in the sole discretion of Landlord . 3, Recognition A1.,orecment. Upon the request of Tenant , Landlord shall enter int o a r~cognition agreement with a sub less ee under an "Appro ved Sublease" (as hereinbelow defined) to the effe ct that, notwith stan din g the termination of this Lease by Landlord , such subl ease and the rights of the sub les see thereunder shall not be disturbed by Landlord but shall continue in full forc e and effect as a direct agreement between Landlord and such sub lessee so long as such subl essee shall contin ue to observe and perfonn for Landlord's benefit all of its obligation s under such sublease. A sublease shall be considered an "Approved Sublease" it (i) the sublessee • • thereunder is an entity that is unrelated to Tenant , (ii) if the subl ease covers the land shown on • the Site Plan as Parcel I, there is only one sublea se of all Parcel I, or if the sublease covers all or a portion of Parcel 2, ther~ are no more than three subl eas es, (iii) the sublease either (a) obligates 14 • th e suble ssee to pa y Base Rent in a per square fo ot am ount not less than the per squar e foo t Base Rent paya bl e und er thi s Lease (in cluding escalati ons thereof as they occ ur) as well as all other charges payabl e by Tenant under thi s Lease, or (b ) obligates the subless ee to agree with Landlord in th e recognition agreement that if the subl es see's monetary obligati ons to Tenant are less than that described in th e clau se (a), then upon tennination of thi s Leas e sublessee 's monetary obligation s to Landlord shall equal Tenant 's per square foot rental obli gations under this Lease , (i v) the sublessee co venants , upon any termination of thi s Lease, to cure any defaults of Tenant that are nonrnonetary and are otherwise susceptible to cure by the subless ee, (v) Landlord is not bound by any rent pai d by the subless ee more than thirty (30) days in advance, and is not responsible for an y security deposit posted by the sublessee that was not received by Landlord , (vi) Landlord is not liable for any default by the sublessor under the su::e .. se {provided that Landlord shall perform tho se obligations arising or newly accruing after the date of termination of this Lease), and (vii) Landlord shall not be requir ed to perform any er mants undertaken by the sublessor under the sublease that are not co venants of Landlord under this Lease . Tenant shall reimburse Landlord for its attorneys' fees and any other direct out of pocket costs incurred in connection with the r~:o_gnition agreement. • • Article 8 [intentionally Omitted] !.rticle9 Mechanics Liens 1. Liens . Tenant shall pro mptly pay when due the entire cost of all work done to the Premises by or at the reque st of Tenant and Tenant shall keep the Premises free ofliens for labor or materials . Should mechanics', materialmen's , or other liens be filed against the Premises , Tenant shall cause th e lien to be canceled and di scharged of record , or shall file a bond in sub stitution of the mech ;nic's lien in accordance with the provisions of Colorado Revised Statute 38-22-131 , et. seq., within forty-five (45) days ofTenant's receipt of notice of such lien. Notwithstanding the foregoing , Tenant may contest, in good faith and with reasonable diligence, the validity of any such lien or claimed lien , provided that Tenant shall give to Landlord such security as Landlord may reasonably request ensure the payment of any amounts claimed . If the Tenant contests a lien or cl aimed lien , then on final determination of the lien or claimed lien , the Tenant shall cause the li en to be released and , in the event of an adverse judgment, satisfy such judgment. 2. Protection of Landl ord 's Interest in Premi se,;. Nothing in this Lease shall be construed as gi,i.,e Tenant or any other person an y right, power or authority to act as agent of or to contract for , c,r pern,it the rendering of, any services or the furnishing of any mdterials in such mann er as would give ri se to the filing of any mechanic s' liens or other claims against the fee of the Premises or the improvements thereon. Landlord shall have t"e right at all reasonabl e times to po st, and keep posted, on the Premises any notices which Landlord may deem necessary for the protection of Landlord and it interest in the Premises and the improvements thereon from mechanic s' liens or other claims . 15 Article JO Indemnity and Insurance I . lnd emnit,l', From and after th e Effecti ve Date and contin uin g at all tim es th erea fte r durin g the Tenn hereof: A. Tenant as sum es all ri sk of loss, damage, or destruction to the Premi ses, Improve men ts, Buildings and co nt ent s, or to any other pro perty brought upon th e Premi ses , Imp roveme nts , and Building by Ten ant, or by any other perso n, with or without !he consent or know ledge of Tenant. Tenant hereby in~e,nnifies and agrees to protect and defend Landlord from all such lo ss, damage , or de strnctio n including clai ms and causes of actio n ass erted against Landlord . B. Tenant shall indemnify and save hannless Landlord from any and all ;!aims, losses, damages , or expenses, on acco unt of injuries to or death of any and all person s whomsoever while on the Premi ses, and any and al l loss or de 5tru ction of or damage to the Premises , the Improvements , the Building and any contents and personal property located upon the Premises and ow ned by, rent ed to, or in the care, custody, or control of the parties hereto, or any of Tenant 's subten ant s, arising or owing o:.i t of, or in any manner conn ected with : (i) any use and occup ancy of the Premises by Tenant or any subtenants for a Pennittcd Use or otherwise; (ii) caused or occas ion ed, in who le or in part, by reason of or arising durin g the pres~nce upon the Premises of the person or the property of the Tenant , it s officers, employees, agents, subt enants , renters , customers, invitees, licen sees, servants, contracto rs , sub co ntractors , materi alrn en , sup pliers, workmen , laborers, and the empl oyees and age nts of each of the foregoing , or any and all other persons, in vited or ot he rw ise , with or without Tenant's consent, whil e on the Premi ses; (iii ) arising out of or re sulting from Tenant's devel opment, sa le or marketing o f th e Premises an d/or the Improv ement s; and (iv) any plan s or de sign s for th e Improvements prepared by or on behalf of Tenant or Guarantor. C,. Tenant hereby indemnifies and saves ham1less La ndlord and any of its offic ers , mem bers, contractors an d agents from any an d all claims , los ses, dam age s, or expenses , on acco unt of injuri es to or death of any and all persons whomsoever, and any and all loss or destructi on of or dam age to any real or personal property adjacent to the Premi ses , ca used by Tenant or any of its employees, managers , members, officers , co ntract ors , sub co ntract ors , materialmen, s1J ppliers , workmen, laborers , subtenants, ren ters, li ce nsees, serv ant s or agents. D. The foregoing indemnitie s shall not apply to any injuries, death , claims, losses , damages and expenses lo the extent ari sing as a res ult of any negligence or intenti ona l acts of Landlord or its officers , em pl oyees, contractors or agent s. E. Land1 ord hereby ind emn ifi es " d saves hannle ss Tenant , to the i;x tent • • permitted b) law, from any an d all claim s, los ses, damages, or ex penses, on acco unt c,r injuri es to or death of any and all person s whomsoever while on the Premises, an d any and all lo ss or de structio n of or damage to th e Premi ses, the Improvements , th e Buildin g • and any contents and personal property located upon th e Premises and owned by, rented 16 • • • to , or in the care , custody, or contro l of the parties hereto, or an y of Tenant 's subtenant s, arising from the negligence or wil lful misco nduct of Land lord, its officers , employees, or agents. 2. Appear and Defend . Landlord and Tenant further agree, that if it is the indemnifying party, that it will appear and defend at its own expense, in the name and on behalf of the indemnified party, all claims or suit s for injuri es to or death of perso ns or loss or destruction of or damage ta property arising or growing out of or in any manner connected with or caused or occasioned by or in co nnection with its indemnities set forth in Article I 0.1 above. A. Property Damage. During the period of construction , Te,tant shall keep or require its general contractor to keep , a policy of builders ri sk in su rance coveting lo ss or damage to the Improvements for the full replacement cost of ali such construction. During the Term and all option periods , Tenant shall keep in full force and effect a poli cy of all risk , special form or equivalent form property insurance covering lo ss or damage to the Premises in the amount of the full replacement cost of the Building and other improvements on the Property, in an amount at least equal to the hard costs of construction, with a deductible that is commercially reasonable in light of Tenant's financial strength . B. Liability Insurance . During the Term, Tenant shall keep in full force co mmercial general liability in surance or garage liability insurance (collt!Clively, "CGI)'), with bodily injury and property damage coverage with respect to the Premises and business operated by Tenant, which shall name Landlord and, at Landlord's written request, Landlord's first Mortgagee as additional insureds as their respective interests may appear. The limits of such CGL policy shall be not less than $2,000,000.00 combined single limit for bodily injury and property damage, with a deductible that is commercially reasonable in light ofTenant 's financial strenb>th. The CGL poli cy combined si ngle limit for bodily injury and property damage requirement may be increased by Landlord , but not more than once in any three (3) year period, to a commercially p1udent and reasonab le amount, based upon the then current general liability in surance con ditions prevailing in the metropolitan Denver market. C. Workers' Compen sation In surance . To the extent required by law, Tenant shall maintain workers' compensation inslll1lll ce covering its employees in s.a tutory limits. D. Automobile Liabi lity. Tenant shal l maintain al all times during the Term garage liab ility insurance coveting liability arising out of the use of (i) all Tenant owned vehicles , (ii) all vehicles hired or leased by Tenant anc! (iii) all non-owned and borrowed vehicles. E. Form of Policies. All insurance required by thi s Section shall be with insurers li censed or otherwi se permitted to conduct busi ness in the state in which the Premi ses are loca•.ed. Any inslll1lllce hereund~-r may be provid ed under blanket polic ies of insurance. All pmpcrty in surance mau,tained by Tenant pursuant to subparagrap hs (a) and 17 (b) of this Section shall name Tenant as insured and Landlord as additional insured , as their • , . .terests may appear , and , so long as the Premises are mortgaged pursuant to a mortgage of which Tenant has received written notice , shal l 1,e s'tlbjec! to a standard mortgagee clause in favor of Landlord's first mortgagee . F. Policy Provis ions . All policies of in surance (other than self-ins•Jra11ce) enumerated above shall be provided by insurance carriers having at policy commencement a Best rating of not less than A-Vlll; provideci, however, that iftheratingofany such insurer falls below such level, such rating reduction shall not constitute a default hereunder provided all renewals of such policies shal! b-: with cartiers with a Best rating of not less than A-VIII at the time of such renewal. An increased coverage or "umbrella " policy may be provided and utilized by either party to increase the coverage provicied by individual or blanket policies in lower amounts, and the aggregate coverage provided by all such policie.; with respect to the Premises and Tenant's liability hereunder shall be satisfactory provided that such policies otherwise comply with the provisions of this Section 11 . G. ~•-;,ver of Right of Recovery and Subrogation . With respect to any loss covered by insu:• ,ice or required to be covered by insurance hereunder, Landlord and Tenant hereby waive any and all rights of recovr.ry against each other for any loss or damage to the Premises or the contents contai , . ·herein, or for loss of income on account of fire or other casuai'y, and each party's aforesaid policies of insurance shall, to the extent available, contain appropriate provisions recognizing this mutual release and waiving all tights of subrogation by the respective insurance cartiers. H. Evidence oflnsurance . On or before the Commencement Date, Tenant shall cause to be issued to Landlord certificates of insurance evidencing compliance with the applicab le covenants of this Article I 0. Each such certificate shall provide that at least thirty (30) days' notice of cancellation shall be given to the certifica te holder. Article 11 Damage or Destruction 1. If the Premises or any of the Improvements are damaged or destroyed during the Ini tial Tenn or First Extension Option by a fire or other casualty ("Casu alty"), this Lease shall continue in effect, and Tenant shall continue to pay the Rent without abatement. Tenant shall remove and dispose of all hazardous materials in accordance with applicable legal requi rement s and take such action as may be required und er applicable municipal ordinances and other laws, rules and regulations with respect to any damage or destl'Uction of the Tenant's lmprovemenls Tenant shall not have any obligation to repair and/or rebuild the Tenant's Improvements damaged by fire or other c.,,ualty or cause . Tenant shal l promptly provide a sightly barrier "~-~ shall remo v~ all debris from the dam11ged portion of the Tenant's Improvements and use diligent efforts to place the Premises in an orc,erly and safe conditio n. lfreque;ted by Landlon.l ~hould Tenant elect not to rebuild , Tenant shall, at its sole cost and expense, raze and remove a,,y • remaining portion of the Tenant's Improvements and fill and grade the Premises in a safe and • sightly manner. "i'enant s'.1all retain any excess insurance proceeds . 18 • • • 2. In the event Tenant ele c:s 10 repair and/or rebuild the Imp rove ment s, if the cost of such repair or rest oration shall be less th an the insuran ce proceeds paid as a result of the Casualty, Tenant shail be entitled to retain the bal ance of such pro ceeds to th e extent not required to be applied to any Leasehold Mongage Tenant shall complete all work promptly after the occurrence of the Casualty. All repair and/or restoration work shall be perfonned in a good and workmanlike manner and shall be subject to all provi sions of this Lease applicable to construction of the Improvement s. 3. In the event the Casualty occurs during the last two lease years of any exten sion following the expiration of the First Extension Option , if Tenant elects not to repair and/or rebuild and gives written notice to Landlord within one hundred twenty (120) days of the 1)•te of the Cas ualty of such election , Landlord shall have the option , exercised by written notice t Tenant on or before the earlier of (a) one hundred twenty (120) days following written no tice frorn Tenant of its election not to repair and/or rebuild, or (b) two hundred forty (240) day ~ following the date oftbe Casualty, to (a) continue the Lease to the end of the then current term, in which case there shall be no abatement of rent, and the insurance proceeds shall be paid to Tenant except to the extent required to payoff and discharge any Leasehold Mortgage, or (b) to terminate the Lease effecti·;e as of one hundred twenty ( 120) days following the date of the Casualty, in which case the insurance proceeds shall be paid to Landlord except to the extent required to payoff and discharge any Lea sehold Mortgage. Promptly following the Casualty, Tenant shall promptly provide a sightly barrier and shall remove and dispose of all hazardous materials in accordance with applicable legal requirements, take such action as may be required under applicable municipal ordinances and other laws, rules and regulations with respect to any damage or destruction of the Tenant's Improvements , and shall use diligent efforts to place Lie Premises in an orderl ·:, clean and safe condition. If Tenant does not elect to repair and/or rebui ld, if requested by Land lord , Tenant at its sole expense (using any insurance proceeds to the extent applicable) shall remove and raze the portion of the Premises which is damaged, remove and disp ose of all hazardous materials in accordance with applicable legal requirements , and, at Landlord's election , fill and grade the Premises in a safe, clean and sightly manner as existed on the Co mmencement Date , or seed such portion of the Premises as designated by Landlord. Any remaining insurance proceeds shall then be used to pay off and discharge any Leaseho ld Mortgage, and the balance, if any, shall be paid to Landlord. 1n the event Landlord enters into a subordination agreement with Tenant's leaseho ld mortgagee, notwithstanding any provision in the agreement to the contrary, in no event shall the right ofLan,'J.,·d or Tenant to use insurance proceeds to remove and raze the darnaged porti on or remove and dispose ofhazar.Jous materials be deemed subordinated to the right s of s'llch lease:,old mortgagee. Article 12 Eminent Domain 1. Definition of Taking and Substantial Taking . For the purpose of this Lease, a "Taking" shall mean any condemnation or exercise of the power of eminent domain by any authority vested with such power or any other taking for public use , in cl uding a private purchase in lieu of condemnation by an authority veste with the power of eminent domain ; the "Date of Taking" shall mean the earlier of the date upon which title to th e Premises or any portion thereof or any right appurtenant thereto so taken is vested in the condemning authority or the date upon whi ch possessio n of the Premi ses or any portion th ereof is taken by the condemnin g authority ; 19 and "S ubstantially All of th e Premises " shall mean so much of the Prem ises or the rights • ap purtenant th ereto as , whe n taken , leaves the untak en portio n unsuitable in Tenant's reasonabl e opi nion for the con ti nued feas ible and economi c operation of the Premi ses by Tenant for the same purposes as immediately prior to such Taki ng or as contempl ated herei n. 2. Tenant's Right s Upo n Taking or Sub stantial Taking . Each party agrees to furnish th e other a copy of any noti ce of a threatened or proposed Taking received by such party. !n the eve nt of a Taking of Sub stantiall y All of the Premi ses , thi s Lease shall terminate and beth Land lord and Ten ant shall be reli eved fro m all further obli gations hereun der from and after the Date of Taking . All Base Re nt and other sums payable by Tenant hereunder shall be ap porti oned and paid throu gh and includin g the Date of Taking , and neither Landlord nor Tenant shall have any ri ghts in any compensation or damages payabl e to the other in connection with such Taking . 3. Tenant's Rights Upon Less Than Sub stant ial Taking. In the event of a Taking of less th an , · ubstantially All of the Premises , Base Rent and other charges shall be reduced fairly and eq11 1t, ,'i,ly in accordance with the portion condemned or taken, effective as of the Date of Takin11, u 1 i Ten ant shall make all necessary restoration s to the Improvements so that the porti G~:l i the Improvemen ts not taken co nstitute a com plete architectural unit, and the proceed s of the award attributable to the val,:•: of the Improvem ents Taken shall be retained by Tenant. If any Taking occurs following the exp iration of the First Extension Option and has a material impact on T enant's abil ity to co ndu ct busi ness as reasonably determined by Tenan t, thi s Lea£e shall termin ate r t Tenant's option , such option to be exercis ~d by Tenant giving not less than thirt y (30) day s' pri or wri tlen notice to Land.lord , such notice to be given not more th an sixty '.60) days after Ten ant's receipt of notice of the imp ending Tak ing. 4. Rights Upon Temporary Taking. Notwi th stan ding th e foregoing , in the event of a Tak ing of th e Premi ses or any pmtion thereof, for temporary use (specifically one not exceeding on~ hundred eighty (180) days in durat ion), with out the tak in g of the fee si mpl e title thereto , thi s Lease shall remain in full fo rce and effect, and there shall be no abatement of Rent during such perio d. All awards, damages, com pensatio n and proceeds payable by the co ndernn or by reason of such Tak ing relat ing to the Premi ses for periods prior to th e expiration of the Lease shall be payable to T enant. All such award s, damages , co mpensati on and proceeds for periods after the ex piration of the Lease shall be payable to Landlord. Anything contai ned in this subparagraph (d ) to the contrary notwithstanding, a temporary Taking for any period in ex cess of one hundred eight y (180) days ma y, at Tenant's option, be deemed a perm anent Taking and shall be governed by subp aragraph (b) or (c) above , as ap pli cable . 5. Awa rd . 'nie .ward paid by the co ndemning auth ori ty shall be all ocated as fo li o vs: A. Firs t to the Landlord in an amount eq ual to the va lu e of th e Premises (o n the ba sis of unimpro ved land not encumbered by th i Lease) B. Nex t to the Tenan t in amount equal th e value of th e Tenant's leasehold int erest and Imp rovem ents , subject to the ri ghts of any Leasehold Mortgagee. If thi s Lease is not term inated , the award for th e cost ofrestming the Imp rovements shall be payab le to Tenant , subject to the rights of any Leasehold Mortga3ee. C, • C. Any oth er award pennined by law sha ll be payab le to Landl ord and Tenant as their re spective int eres ts may ap pear. Landlord and Tenan t shall each have the right to repre sent th eir resp ec tive int erests in each proc ee ding or nego ti atio n with respect to a laki ng or intended taking by power of condemn at ion and to make foll proof of their claims. Tenant shall ha ve the sole right lo control the defen se, prose cution and settlement of its claim to th e ex lent the condemnati on proceer.ing or negoti ation affects Tenant's lease hold intere st hereund er and/or the Improvements, subj ec t to the co nsent of any Lea sehold Mortgagee. Lan dl ord shall have the sole right to control the defense, prosecution and se ttlement of its claim to the extent th e co ndemn at ion pro ceeding or neFotiation affects Landlord's reversionary interest in the Premises and/or Improvements . Landlord and Tenant each agrees to execute and deliver to th e other any instrum ents that may be reaso nabl y required to effectuate or facilitate the provisions of thi s Leas e rel ati ng to con demn ati on. Article 13 Default I . Events of Tenant's Default. Any of th e following occ urrences, conditions ur acts by Tenant shall con stitute an "Event of Default" under this Lease : A. Failure to Pay Rent: Breach. (i) Tenant's failure to make any payment of money required by thi s Lease (including without limi tation Base Rent or Real Estate Taxes) (s ubj ect to Tenant's right of good faith contest with respect to Real Estate Taxes, as set forth in and as limited by Article 5), within ten (10) days after the receipt of written notice from Landlord to Tenant that same is overdue ("Monetary Default"), ir, which event such delinquent am ount shall accrue interes1 at th e Default Rate : or (ii ) Tenant's failure to observe or perfonn any other material provision of this Lease within thirty (30) days after receipt of written noti ce fr om Landlord to Tenant specifying such default and demanding that the same be cured ("N on-Monetarv Default "): provided that, if such defa ult cannot with due dili gence be wholly cured w,thin such thirty (30) day peri od, Tenant shall have such longer period as is reaso nably necessary to cure the defau lt, so long as Tenant proceeds promptl y to commenc e the cure of same within such thirty (30) day perio ~ and diligently prosecutes th e cure to completi on. In no event shall Lan dlord be requ ired to give more than one notice of a monetary default during any twelve (12) month period , and in th e event one such noti ce has been given , Tenant shall be in default if any payment is not made when du e, no noti ce shall be required , and interest shall accrue al the Default Rate from th e date such payment was due until paid. B. Bankruptcy . Any petition is fi led by or agai nst Tenant under any section or chap ter of the Federal Bankruptcy Code, and, in the case of a petition fi led against Tenant, such petition is not dismiss ed within six ~/ (6 0) days after the date of such filing. C. Inso lvency. Tenant becomes insolvent or transfers property in fraud of creditors . D. Ass igmnenl fo r Be nefi t of Cred itors. Tenant makes an assignment fo r th e benefit of cr edi tors. 21 E. Receivership. A receiver is appo inted for any of Tenant's assets. F. Attachment. This Lease or Tenant's interest in the Premises or any part thereof is taken by attacl un ent, exec uti on or other process oflaw, and such attachm ent, exec uti on or other process has not been re leased with in sixty (nO) days thereafter. G. Lien. Tenan t fa il s to obtai n a release of any li en against tl1 e Prem ises as required under tl1e term s of this Lease. In the even t th e Tenant cont inu es to pay Rent required under the terms of thi s lea se, no Eve nt of Defa ult shall occur so lely as a result of Tenant's bankruptcy, insolvency, assignment for benefit of its cred it or.;, or the appointment of a receiver for any of Tenant's assets. 2. Landlord's Remedies . After th e occ urrence of an Event of Defa ult by Tenant, Land lord shall have the right to institute from time to time an action or actions (i) to reco ver damages (excl usive of consequential or special damages), (ii ) for injunctive and/o r other equitable reli ef, and (iii) in th e event of Monet&ry Default only, to recover possession of the Premi ses and termin ate thi s Lease. A. In the event of a Monetary Default: • (i) OJntin ue Lease . La ndl ord ma y, at its option, continue this Lease in full force and effect, with out terminating Tenant's rigl-• to possession of the Premises, in which • event Landlord sha l', have the right to co ll ect Base Rent and oth er charges when due, including any sums du e for any opti on period for which an extension option has been exercised , together with Landlord 's reaso nable attorneys' fee s and interest at th e Default Rate from th e dat e such payment was due un til the date paid by Tenant. In the alternative, Landlord shall have the right, at its optio n to make any payment , such as taxes, otherwise req uired to be made by Tenant, in which event such payment shall not be deemed a cure of Tenant's default, and Tenant shall reimburse Landlord for an} such payment, together with reasona ble attorneys' fees and interest at th e Default Rate from the date Landlord notifies Tenant that Landlord made such payment to th e date Landlord receives such reimbur.;ernent. Landlord shal l bave the right to peaceably re-ent er the Premises, without such re-en try bei ng deemed a term'mation of the Lease or an acceptance by Landlord of a surrender thereo f. Landlord shall also have th e right, at its option , from time to time, without terminating this Lease, to relel. the Premises, or any part thereof, wi th or wi thout legal process, as th e agent, and for th e accoun t, ofTcnant upo n such term s and cond itions as Land lord may deem advisable , in which event th e ren ts received or. ~ueh relettin g sha ll be applied (i) first to th e reasonab le and actu al expenses of such relett ·.,,i; and co ll ectio n, including without limitation necessm; renovation w1d alterati ons of the Premi ses, reasonable and actua l attorneys' fees and any reasonable and actual real estate commi ssio ns and consulting fees paid , nnd (ii ) thereafter toward payment of all sum s du e or to become due to Landlord hereunder. If a sufficient wnount to pay such expenses and su ms st.all not be realized , in Landlord 's exercise of commercial ly reasonable effo rts to mitigate its dwnages (which Landl ord hereby • agrees to make), then Tenant shall pay Landlord any such defi ciency monthly, and Landlord may bring an action or action s th:refo r as such monthly deficiency shal l anse and accru e. 22 • • • Landlord shall not, in any event, be required to pay Tenant any sums received by Landlord on a rel etting of the Premises in excess of th e ren t provided in this Lease, but such excess shall redu ce any accrued present or futur e obli gati ons of Tenant hereunder. Landlord's re- entry and reletting of the Premises wi thout termin atio n of thi s Lease shall not preclud e Landlord from sub seq uentl y terminating thi s Lease as set forth below. (ii) Terminate Lease . Landlord may terminate thi s Lease by written notice to Tenant specifying a date tl1erefor, which shall be no soo ner than thirty (30) days following rece ipt of such notice by Tenant, and thi s Lease shall then terminate on the date so specified as if su ch date had been originally fixed as the expiration date of d:ie Term. In the event of such termination, Landlord shall be entitled to recover fro m Tenant all of th e following as drn1ag es: (A) The "worth at the time of the award payment" (defined below) of any obligation which has accrued prior to the date of termination . (B) To, "worth at the time of the award payment " of the amount by which the unpaid Bas~ Rent and all other charges which would have accrued after termination until the time of award payment exceeds the amount of any sums (net of reletting costs and expenses) actually received by Landlord from the Premises after termi.'lation . Landlord shall have an affirmative obligation to attempt to mitigate its damages following termination , until the time of the award payment. (C) The "wo rth at th e time of the award payment" of the amount by which the Base Rent and all other charges which would have accrued after the time of the award , ent for the remaining term of thi s Lease exceeds the Fair Market Rent ("FMR"), det emu ned in the manner set forth below, for the remaining term of this Lease . The FMR , as used in this Leas e, shall be the fair market re ,1t of the Premi ses, net of market brokerage commissions and consulting'fees, as of Lie tin•.e of the award for a term equ al to the remainin g term of this Lease subsequent to the tir,,e of the award payment (assuming this lease had not been terminated) on an "as is'' basis, as determined by a li censed MAI appraiser selected by Landlord . At Tenant 's option, Tenant may select an additional licec ·-.d MAI appraiser to es tima:,· FMR and Tenant 's appraiser and Landlord 's appraiser shall select a third MAI apprai ser to estimate the FMR, in which case th e FMR shall be the median of th e three ap praisal s. Tenant shall bear the cost of the appraissl process. As used in thi s Article 13, Paragraph 2, the term , "worth at the time of the award payment", shall be computed by allowing simple interest at an acerual rate equal to the Default Rate for pas t due obligations, and a discount rate to net pre1ent value at the time of the award payment of eight percent (8%) pet annum on anticip ated future obligations or revenues , and mitigation amounts, with no interest or discount, on the amount of the obligation s payable on the date of such calculation. In the event t.us Lease shall be terminated as provided above, by sun,mary pro ceedings or otherwi se, Landlord, its agents, servants or representatives may immediatel y or at any time thereafter peaceably re-enter and resume possessio n of the Premises an d, at Tenant's expense, remove all perso ns and 23 property therefrom, by summ ary dispossession proceedings. La ndl ord shall never be • entitled to dispossess Tenant of the Premi ses purs uant to any "lock -out " or other nonjudicial remed y. (iii) Reimbursement of Landlord's Costs in Exercising Remedies. Landl ord may re cover from Tenant , and Tenant shall pay to Landlord upon demand , as Additional Rent, such reasonable and actu al ex pen ses as Landlord may incur in recovering possession of the Premi ses , pl acing the sam e in good order and condition and repairing tl1 e same fo r reletti ng, and all other reasonabl e an d actual expenses, commissions and charges incurred by Landl ord in exercising any remedy provided herein or as a result of an y Event of Default by Tenant hereund er (i nclud ing without limitation reasonable attorn eys' fees), provided that in no event shall Tenant be obligated to compensate Lan<l b rd for any speculativ e or consequential damages caused by Tenant's failur e to perfonu its ob ligati on s under thi s Lease. B. Remedi es Are Cumul ative. The va--ious rights and remed ies res erved l(l Landlord her~n are cumulative, and Landlord ma y pursue any and a,I B. "\l; rights and remedies , in addition to any other rights or remedies available at law or in equity, wh cth io ~t the same time or otherwise (to the exteP.t not inconsi stent with specific provisions of thi s Leas e). Notwi thstt.nding an)1hing herein to the contrary, Landl ord expressly waives its right to forcibly dispo ssess Tenant from the Premi ses, whether peaceably or otherwise, wi thout ju dicial process , r:Jch that Landlord shall not be <· •"•!ed to any "commercial locko ut" or any oth er provi sions of applicabl e law which pet .nit landlords to di spossess • tenan ts from commercia l pro perti es without th e benefit of judicial review. C. Mitigation of Dam ages . In the event Landlord elects to termin ate the Lease and seek damages from Tenant as provided herein, Landlord will use reasonable efforts to mitigate its dam ages . Landlord shall have th e opti on but not tl1e obligat ion to li st the Premises for leas e with a real estate broker. In th e event Landlord elects not to so list the property but instead elects to itself market the Property for lease, such election shall not be deemed to constitute a failure by Landlord to mitigate . Landlord will not be obligated to accept less than the then current market rent for the Premises ; deviate from its then established guidelines for tenants including without limitation use, experience, reputation , and creditworthiness; lease less than all of the Premises ; extend the term of thi s Lease; or expend any money on behalf of a new tenant. Tenant will not have any independent, affi rmati ve claim against Landlord on acco unt of Landlo~d's failure to miti ga te its dam ages ; however, such failure to miti gate may be asserted by Ten ant as a defen se to a claim by Landlord to tl1 e extent allowed by law. D. .Waiver of Landlord 's Lien . Landlord hereby waives any statutory lien s and any rights of di stress with respect to tl1e Tenant's Prop erty (as defined below) from time to time located on the Premi ses. This Lease does not grant a co ntractu al lien or any other sec urity interest to Landlord or in fav or of Landlord with respect to Tenant's Property. Landlord further agrees, without cost to Tenant , to execute and deliver such in struments reaso nabl y reque sted by Tenant from time to time to evidence the aforesaid waiver of • Landlord. As used herein the term "Tenant's Property" shall mean all mo vab le partiti ons, 24 • • • business and trad e fixtures , mac hbery and equipment , automobil es, compu ters , funtiture , satellite dish (s), si gn age, co mmuriications equipment and office equipment, and all furniture , furni shings and other articles of personal property owned by Tenant and lo cated in the Premis es. 3. Landlord 's Default. In the event Landlord shall at an y time be in default in the observance or performance of any of the coven ants and agreement s required to be performed and observed by Landlord hereunder and any such default shall continue for a period of sixty (60) days after written notice to Landlord (or if such default is incapable of being cured in a reasonable manner within sixty (60) days and if Landlord has not commenced to cure the same within said si xty (60) day period and thereafter diligently prosecutes the same to completion), and Landlord shall no t thereafter cure such default, Tenant shall be entitled , at its election, to bring suit for the collection of any amounts for which Landl ord may be in default, or for the performance of any other covenant or agreement devolving upon Landlord, in addition to all remedies otherwise provided in this Lease and otherwise available at law or in equity under the laws of the United States or the State of Colorado . 4. Attorneys ' Fe:s In the event that either Landlord or Tenant commences any suit for the collection of any amounts for which the other may be in default or for the performance of any other covenant or agreement hereunder, the prevailing party in any such action shall be awarded its r.osts and expenses, including, but not lintited to , all attorneys' fees and expenses incurred in enforcing such obligations and/or ::ollecting such amounts , from the other party to such action , 5. Waiver of Consequential Damages. In no event shall either Landlord or Tenant have the right to recover consequential damages of any kind from the other. Except as limited hereinabove, all rights and remedies may be exercised and enforced concurrently and whenever and as often as Landlord or Tenant shall deem necessary . In the event of a default by Tenant, nothing contained herein shall preclude , or be deemed a waiver, of Landlord 's right to recover damages arising from its ownership or operation of the property owned byit adjacent to the Premises . Article 14 Covenant of Quirt Enjoyment Landlord agrees that Tenant shall quietly and peaceably hold, possess, and enjoy the Premises, without any hindra.~,;e or molestation by the agents or employees of Land lord, and further , Landlord shall, and any additional exceptions created by Tenant or created by Landlord and approved by Tenant, d. '::nd the title to the Premises and the use and occupancy of the same by Tenant against the lawful cl aim s Jf all person s whosoever, except those claiming by or through Ten ant. Article IS Subordination; Landlord's Right to Mortgage and Convey Premises Landlord may mortgage its interest in the Premises , pro vided such mortgage expre ss ly pro vides that the rights and interests of the mortgagee thereund er are subject and .,5 subordinate to th e rights and interests of Tenant hereund er a11d the ri ght s of ,my Len:•ch old • Mortgagee under any Leasehold Mortgage then or thereafter exi sting. Sh o.,d Lnnd lord sell , co nvey , or transfor it s int eres t in the Premises or shoul d any mortga gee of La ndl ord s•Jccced to Land lord's intere ,t through fo reclosure or de ed in lieu thereo f, Ten ant shnll 1111 0 m to s:1ch succeeding party as its landlord und er this Leas e promptly upon any s'Je h :;occess ion, provi<lr,<l such succeeding party ass umes all of Landlord's duties and obligation s und er th is Lc ns e, Su ch succ eedin g pnrty shall not be li able for any of La ndl ord's obligati ons aml duti es hereunder pri or to its ass umpti on of Landlord's duties nn d ob li gat ions hereunder. Article 16 Transfers by Landlord No transfer or sale ofLandlod's intere st here under shall release Land lord from any of its ob ligations or duties hereundet prior thereto . Landl ord shall be released of any ongoing ob ligation s hereunder from and after the date of such t.>-ansfer and onl y upo n the assumption of all such obligations and duties by the transfe ree ot Landl ord , Notwithstandins anything co ntain ed herein to the contrary, in no event shall Landlord have the right to tran sfer, in any manner whatsoever, or to sell it s interest here under pri or to delivery of posses sion of th e Premi ses to Tenant. Article 17 Miscellaneous I, Non -Waiver of Default. No acq uiescence by ei ther party to 1my default hy th e • ot her party shall opemte as a waiver of its rights with respect to any other breach or dcfo ult , whet her of th e same or any oth er coven an t or condit ion . 2. Recording. This Lea se shall not be recorded . At such time ns Tenant make s the Securi ty Deposit and the Approva l Period ha s expired, th e parties shall execute , acknow ledge, an d deliver to each other dupli ca•e originals of a short form or memorandum o f thi s Lease ("Memora n dum of Lease ") in sub stanti all y the fo rm of Exhibit C attached hereto und incorporated herein, describing the Premi ses and setting fo rth the Term of this Lea se. The Memorandum of Lease shall be recorded onl y after Tenant makes the $200 ,000 Securit y Deposit and th e Approval Peri od has cx.pired , The recording shall be at Tenant 's ex pen se . In the event Tenant records this Lease , thl:1 Lease shall automatically be deemed termin ated and of no further force or effect. If Tenant te1,·r,nates thi s Lea se, upon requ est of Landlord, Tenant will execute and deliver to Landlord a te m,:no t;:~ of the Memorandum of Lease su itabl e for recording . 3. Notice. Any noti ce, requ est, offer, approval , consent, or other co mmu nica ti on required or permitted to be given by or on beha lf of either party to th e oth er sha ll be given or co mmuni cated in writing by perso nal delivery, repu tab le ave.night courier serv ice whi ch kc-cp s receipts of d eliveries (i .e., Federal Expres s), or Unit ed Sta tes certified mai l (ret urn receipt requ ested with postage fully prepaid ' or ex press mail se rv ice address ed to the oth e• pa rt y as follo ws: lfto Tenant: TT of Denver, In c. 5077 So uth Wadsworth Boulevard 26 • • • • With copie s to: With copies to: Ifto Landlord: With copies to: Littleton , Colorado 801 23 Attention : ~lichael Ward 1T of Denver, In c. c/o Automoti ve Managemc ,ll Services , In c. 575 North Flagler Drive, Suit e P-400 West Palm Beach, Florida 33401 Attention: Terry Taylor Greenberg Traurig, P.A. Fort Lauderdale, Florida 3330 1 Attention: Peter L. Tunis , Esq. Englewo od/McLellan Reservoir Foundation 1000 Englewood Parkway Englewood, Co lorad c 80110 Attention: President Ci ty of Englewood 1000 Englewood Parkway Englewood, Colorado 80 I I 0 Attention: City Attorney or at such other ad dress as may be specified from time to time in writing by either party . All such notices hereunder shall be deemed to have been given on .,,e date personally delivered or the date marked on the return receipt, unless delivery is refu sed or cannot be made, in which case th e date of postmark sha ll be deemed the date notice has been given. 4. Successors and Assigns. All covenants, promi ses, co nditi ons , representations , and agreements herein contained sha ll be binding upon, apply to , and inure to the benefit of the Parties heret o and their resp ectiv e heirs , executors, administrators , successo rs (i ncludin g su btenant s), and permitted assigns. 5. Parti al Inv aliditv. If any provision of this Lease or th e application thereof to an y person or circumstance shall to any extent be held invali d, the reniainder of this Lease or the application of such provision to persons 0r circ umstanc es other than th ose as to which it is held invalid shall not be affected thereby, and each provision of this Lease shall be valid and enforceab le to the fttllest extent permitted by law. 6. Interpretation . In interpreting this Lease in its enti rety, any additions written or typed thereon sha ll be given eq ual weight, and Lliere shall be no inference, by operation of law or otherwi se, that any provision of this Lease shall be constrn ed against either party hereto. This Lease shall be co nstrued without regard to any presumption or other rule requiring construction against the Parties cau sing this Lease to be drafted . 7. Headings, Captions, and References. TI1e section captions contai ned in this Le1se arc for convenience only and do not in any way limit or amplify any term or pro,·ision hereof. The use of the tem,s "hereof," "hereunder," and "herein" shall refer to this Lea se as a who le, 27 inclus ive of the Exhibit s, except when noted other wise . The tenn s "incl ud e," "include s," and • "i ncludin g" in corporate the meani ng "w ith out limitat ion ." The use of the masc ulin e or neu ter genders herein shall include th e masculine , feminine , and neuter genders and the singular form shall include the plu ra l whe n th e co nt ex t so requires. 8. Governing Law . Thi s Lease shall be co nstru ed under the law s of th e State of Co lorado . 9. Exec uti on of Do cument s. Landlord and T~nant shall eac h coo perate with the oth er an d execute such doc um ent s as .'ie other party may reaso nably require or req uest so as to enab le it to conduct its operat ions, so long as the requested conduct or execution of doc uments does not derogate or alter the powers, right s, duties, and responsibilities of the respective Parties. I 0. Force Maje·Jre . Whenever a party is required to perform an act under this Lease by a ce rta in time , unless specifically provided otherwi se in thi s Lease , such party may extend the deadline in the event of Excusable De'ay. In the event a party elects to so extend a de adline, such party shai! fir st give written notice tr the other party within twenty (20) days following the commencement of the Excusable Del ay setting forth the event giving ri se to the Excu sa ble Delay . The part y elect ing to ex tend the deadline shall within twenty (20) days following the end of the Excusabl e Dela y give an additional written notice to the other party sett ing fort h the number of days the peri od has been extended as a result of the Excu sa blr De lay an d the deta ils of such delay. 11 . Reaso nabl e Con sent. No twith standing anything to the contrary contained in this • Lease , in all ca ses where co nsent or ap prova l shall be requ ired pursuant to thi s Lea se, the giving of each consent or approv al shall not be unreaso nab ly withheld or delayed by the party from whom such consen t is required or reque sted. 12. Authority . No agreement , including but not limited to an agreement to amend or modify this Lease or to accept surrender of the Premises, shall be deem ed binding upon either party, unl ess in writing and signed by an officer of the party against whom the agreerne1 ·,t is to be enforced or by a person designated in writing by such party as so authorized to act. No payment by Tenant or receipt by Landlord of a lesser amount than th e Rent herein stipulated shall be deemed to be other than on account of the earliest stipulated Rent, nor shall any endorsement or statement on any check or any letter accompanying any check or payment of Rent be deer,1ed an acco rd and sati sfaction unless expressly agreed to by Landlord acting thru its authorized represent ative , and Landlord may accept such checl: or payment without prejudice to Lru ,dlord's ri ght to re cove r the bal ance of such Rent or pursue any other remedy then available to Landlord. 13. Es toppel Certificate. Each party agrees, fr om time to time, within tw enty (20) days fo ll ow in g wri tten request from the other party, Landlord, to execute and del h·r an estoppel stating that thi s Lease is in full force and effect, and if modified or amended , setting forth such modificati on or amendment, that no de fo ult ex ists, or if a default, setting forth the same, and such other fact ual matters regarding the Lease as may be reaso nabl y requested , provided such estoppel does not obligate the party to acknow ledge or consent to any modifi cati ons or interpretation s of thi s Lease not previously agreed upon by both partie s in writing. • 28 • 14. Holding Over . hould Tenant ho ld vcr, wi th out Landl ord 's consent , after th e • • Lease term has expired and co ntinue to puy Rent . Te nant shull beco me a month to month tenant only. In no even t shall such hold over c.in stitutc an ex ten sion of th e tem1 of thi s Lease. During such hold over, the Rer,, shall be an amount equnl 10 one hundred fifty percent ( 150%) of the Rent du ri ng the las t month of the term of th e Leu se, toge th er with nil other amoun ts payab le by Tenant under the terms of th e Lease. No ne of the tenn s of th is Paragraph or the holding over by Tenant shall cons titute a waiver of any ri ght s of Land lord to tem1in 111e the Lease at any tim e and to re -ent er and take pos session of the Premi se s. Tt'lln nt shu ll reimburse Landlord and indemnify Landlord against all damage s incurred by La ndlord re sulti ng fr om any de lay by Tenan t in surrendering possession of the Premises . Article 18 Leasehold Financing I. Mortgage by Tenant. Tenant ma y, from tim e to tim e, hypothecate , mort gage , pledge, or alienate the Improvements an d/or Tenan t's leasehold es tat e and ri ghts hereun der. Such lien shall be referred to herein as a "Leasehold Mortgage" and the hold er or holders of any such lien shall be referred to herein as a "Leasehold Mortgagee ." The Leasehold Mortgagee's interest in the Premises and thi s Lease shall be subordinate , junior and subject to Landl ord· ownershi p of the Premi ses and interest in thi s Lease. A Leasehold Mortgage shall encumber no interest in the Premi ses other th an Tenant 's interes t in the Lease and the Impro vements lo cated on the Premises, includin g any persona l pro perty ofTcnant, an d any subleases of portion s of the Premises. A Lea sehold Mortga gee or it s assign s may enfo rce such lien and acqu ire title to the leaseho ld estate in any lawfu l way and , pending foreclo sure of such lien , th e Leasehold Mortgagee may take possession of and operate the Premise s, pc-rforming all ob li ga tion s performable by Tenan t, and upon foreclosure of such lien by power of sale, judi cia l foreclosure , or acq ui sition of th e leasehold estate by deed in lieu of forec los ure, the Lc use hold Mortgagee may se ll and assign the leasehold estate hereby created. Notwi th stundi ng ·,nythin g herein co ntained to th e contrary , th e Leasehold Mortgagee or any perso n or en tity ~-;qu iring such leaseho ld estate shall be li abl e to perform the obli gati ons impo sed on Tenant by thi s Lease onl y durin g the period such person has ownership of sai d lease hold estate or pos sess ion of the Premises ; pro vided further tha t, except as expre ssly provided herein , in no even t shu ll La ndl ord 's rights be impaired to exerc ise it s remedies fo ll ow ing an Event of Defa ult pri or to Lease hold Mortgagee's possessio n or ow nership. Landlord agrees to provide an es toppe l lo uny Leasehold Mo rt gagee upo n written reque st there for , provided such es toppel doc s not ob li ga te Lund lord to acknow ledge or consent to any modification s or interpretation s of thi s Lensc not previo usly agreed upon by both parties in writin g. 2. No tice To and Rights Of Leasehold Mortgagees . A. When giv ing notice to Tenant with respect to any default hereunde r, Landlord shai l also serve a r,opy of such notice up on any Leasehold Mortgagee wh o shall have given Landlord a wri lten notice specifyi ng its name and address . No such noti ce sha ll be effective aga in st any Leasehold Mortgagee unless and until served 011 any Leasehold Mo rt gagee as herein provi ded. ln the event Tenant shall cl cfnu lt in the 29 perfo nnan ce of any of th e tenns , covenants, agreements, and condi tions of thi s Lea se to • be perfonned on Tenant's part, any Leasehold Mortgagee shall have the right, within th e grace period avail able to Tenant for curing such default or such additional time as may be -b>ranted to any Leasehold Mortgagee herein , to cure or make goo d, such de fa ult or to cause the same to be cured or made good, whether th e same consists of the failure to pay rent or the failure to perform any other obligati on, and Landlord shall acce pt such perfonnances on the part of any Leasehold Mortgagee as th ough the same had been don e or perfonned by Tenant. B. In the case of a Monetary Default by Tenant, Landlord will take no action to effect a tenninati on of this Lease by reason (hereof unless such default has continued beyond forty-five (45) days after Landlord shall have serv ed a copy of such notice upon Tenant and any Leasehold Mortgagee who has given Landlord notice as pro vi ded in Article 18 .2.A above, it being the intent hereof and the understanding of th e part ies that an y Leasehold Mortgagee shall be allowed not less than fifteen (15) days in addition to the thirty (30) days granted to Tenant to cure any Monetary Default of Tenant. L. In the case of any Non -Monetary Default by Tenant, a Leasehold Mortgai;ae shall be allowed, in addition to any grace period granted to Tenant, an additional time as hereinafter specified to cure such Non-Monetary Default within whi ch either: a) if such defa ul t is a mo netary default or is otherwis e susceptib le of • being cured by the Leasehold Mortgagee without obtaining pos sess ion of the Premises, to commence and diligently proceed to cure such Non-Monetary De fa ult within th irty (30) days following the ex pira ti on of any grace period granted to Tenant , or if such default can not rea so nably be cured within thirty (30) days , to commence such cure within thirt y (30) days fo llowing the expiration of any grace period granted to Ten ant and to diligently pro secute the cure to completion; b) if such default is a non-monetary default and is not susceptible of being cured by the Leasehold Mortgagee without obtaining possession of th e Premises, to commence proceedings to obtain pos sess ion of the Premises within thirty (30) days following the expiration of any grace period granted to Tenant and diligently prosecute such action to completion (including po ssession by a rec eiver) an d lo cure such default withi n tl1irty (30) days following po ssess ion or the appointment of a receiver in the case of a default which is susreptible of being cured within thirty (30) day s when the Leasehold Mortgagee has ob tai ned possession thereof. If such default can not reaso nabl y be cured within thirty (30) day s follo wing possession or appoinbnent of a receiv er, to commence such cure within thirty (30) days following possess ion or appointmen' of a receiver and to diligently prosecute the cure to completion . D. In the event that this Lease '·; cenninated by Lar.,dlord on Recount of any • default, Landlord shall give prompt noti ct d-,ereof to each Le8'1ehold Mortgagee who 30 • • • has given no1ice 10 be notified . Landlorci , within lhirty (30) days after receiving a written requesl therefor, which sha ll be giver, wilhin sixty (60) days afte r such 1erminn1i 0 n, will exec ut e and deliver a new le ,se of the Premises lo the Leasehold Mortgagee or it s nominee or to the purchaser, ,ssignee , or transferee , as the case may be , for the remainder of the lerm of tlti s Lease , co ntainin g the same cove nants, agreements , terms , provisions , and limilations as are con tained herein , provided that the Leasehold Mort r.;rgee sha ll (i) pay to Landlord , simultaneou sly with the delivery of such new lease, all unpaid rental due under this Lease up to and including tl1e date of the commencemenl of the term of such new le ase and all expenses including, without limitation , reasonable attorneys' fees and di sbursements an d court costs incurred by Landlord in connection with the default by Tenant and the terminati on and the preparation of the new leas e, and (ii) the Leasehold Mortgagee shall commence and diligently proceed to cure all defaults existing under this Lease which are susceptible to cure . E. The time available to a Leasehold Mortgagee to initiate foreclosure proceedings as aforesaid shall be deemed extended by the number of days of del ay of occas ioned by judicial restriction against such initiation or occasioned by other circumstances beyond the Leasehold Mortgagee's control. F. During the period that a Leasehold Mortgagee shall be in possessi on of the Premises and/or during the pendency of any foreclosure proceedings in sti tuted by a Leasehold Mortgagee, the Leasehold Mortgagee shal l pu y or cause to be paid all charges of whatsoever nature payable by Tenant hereunder which have been accrued and are unpaid and which will thereafter acc ru e during said period. Following the acq uisition of Tenant's leasehold est~te by th e Leasehold Mortgagee nr its designee, either as a result of foreclosure or acceptance of an assignment in lieu of foreclosure , the Leasehold Mortgagee or party acq uiring title to Tenant's leaseho ld estate, whereon Landlord's right to effect a termination of this Lea£e based up;m the default in question shall be deemed waived. Any default not suscepti ble of being cured by the Leasehold Mortgage,e or party acquiring title to Tenant's leasehold estate shal l be and shall be deemed to have been waived by Landlord upon completion of the foreclosure proceedings or acquisition of Tenant's interest in this Lease by any purchaser (who may, but need not be, the Leasehold Mortgagee) at the foreclosure sale, or who otherwise acquires Tenant's intere-.c from the Leasehold Mortgagee or by virtue of a Leasehold Mortgagee's Exercise of ii! remedies . Any such purchaser, or successor of purchaser, shall not be liable to perlorrn the ob li gations imposed on Tenant by this Lease incurred or accruing after such purchaser or successor no lon ger has ownership of th e leasehold estate or po ssessio n of the Premises. G. Notlting herein shal l preclude Landlord from exercising any of Land lord's rights or remedie s with respect to any other default by Tenant during any period of any such forbearance, subject lo the rights of any Leasehold Mortgagee as herein provided . H. In the evcn l two or rr.ore Leaseh old Mort gagees each exercise their rights hereunder and there is a conflict which i'~s rl..,-~ ;; imposs ible to comp ly wi th all such 31 requests, tl1e Le asehold Mortgagee whose leasehold mortgage would be senior in • priority if there were a foreclosure shall prevail. In the event any Leasehold Mortgagee pays an y rental or other sums due hereunder which relate to periods othe: than during its actual ow nership of the leaseh old estate , such Leasehold Mortgagee shall be subrogated to any and all rights which may be asserted aga inst Landlord with res pect to such period of time . I. Upon the rea so nab le reques t of any Leasehold Mortga gee , Landlord and Tenant shall cooperate in including in this Lease by suitable amendment from time •c time any prov ision for the purpose of implementing the protective pro• ;-,ions .:o ntained in this Lease for the benefit of such Leasehold Mortgagee in allowing•,, . :, Leasehol d Mortgagee reasonable means to protect or preserve the lien of its proposed Leasehold Trust Deed on the occurrence of a default under the terms of the Lease . Landlord and Tenant shall execute, deliver, and acknowledge any amendment reasonably necessary to affect any such requirement ; proviC:cd , however, that any such amendment shall not in any way affect the term or rental under UJ~ Lease nor otherwise in any material respect adversely affect any rights of Landlord under this Lease. J. Tenant shall reimburse Landl ord any atto rneys' fee s or other direct out of pocket costs incurred in connecti on with any lease amendments or other docwnentation or review in connection wi th Tenant's proposed Leasehold Mortgage . Article 19 Representations of Landlnrd and Tenant I. Representation s of Landlord . Exce pt as otherwi se disclosed on Schedule I attac hed hereto, Landlord repr ese nts and warrants to Tenant that , as of the Effective Date : A . Landlord is a non-prof!• 1>oration va lidl y organi zed an d existing under th e laws of the State of Colorado. Lanot ord has the full right, power and authority to enter into this Agreement and to perform Landl ord 's obligation s hereunder. B. This Agreement (i) has been dul y authori zed, executed, and delivered by Landlord; and (ii) is the binding obligation of Landlord ; C. Landlord has not granted , other than to Tenant, any outstanding option , righ t of firs t refu sal or any preemptive right with re spect to the purchase of all or any porti on of the Premi ses. D. To the best of Landlord 's kn owledge , the Premises and use and occ upan cy thereo f is 1. )t in violation of any laws and no written noti ce of such vio latio n has been received by Landlord and is not the subj ect of any existing, pending, or threatened investigation or inquiry by any gove rnmental authority or subject to any remedial ob ligation s under any law s pertaining to or relating to hazardou s materials or other environmental conditions . 32 • • • • • E. There arc no un recorded easement.< or ri ght s-of-wa y affe ctin g any or all of the Pre mi se s excep t the sanitary sewer int erce pt or line s as pre viously disclosed by Lan dl ord to Te nant. F. o lawsuit has been fi led agai nst Landlord regarding th e Premi ses. G. Th ere arc no other leases, 3!,'Teemc nts or co ntrac ts in ex istence relatin g to Lh c Premises, includin g, wiLh out li mit ati on, tenan t leas es, serv ice co ntracts , or manag em ent agreem ent s. H. Lan dl ord has received no notice fro m an y in surance compan y with respect to th e can ce ll atio n of any polic y concern ing the Premi ses or refu sal of th e in surance co mpan y to in sure th e Premi ses. I. Th ere are no oral agreement s affe ctin g the Premi ses . .I. There is no litigation pending with res pec t to the Premi ses relating to any Enviro nmental Law viol ations . Except as dis clo sed in writ in g by Landl ord , no noti ce of an Environmental Law violation or oth er writt en co mmuni cati on has been recei ved by Landlord from a governm ental agenc y or any other person or enti ty all egin g or sugge stin g an Environmental Law violati on on the Premi ses. Th e tenn "Environmental Law ," as used in thi s Agreement, shall include : (I) Compreh ensive En viro nm ental Re sponse, Comp ensati on, an d Liability Act of 198 0, as amend ed by the Sup erfund Amendm ent s and Rea uth ori za ti on Ac t of 1986 , 42 U.S.C.A. §96 01 , et seq. ("CERCLA "); (2) Solid Waste Di spos al Act, as amend ed by th e Reso urce Co nservation and Reco very Act of 1976, as am end ed by th e Hazard ous and Solid Was te Amendm ents of 198 4, 42 U.S.C.A . §69 01 , et seq .; (3) Fe deral Wat er Polluti on Co ntro l Act of 19 72, as am ended by th e Clean Water Act of 1977 , as amended , 33 U.S.C .A. §125 1, et seq.; (4) Tox ic Sub stan ces Co ntro l Act of 1976, as am ended , 15 U.S.C.A. §260 1, et seq.; (5) Emerg en cy Plann ing and Co mm um:y Right -to-Kn ow Ac t of 1986, 42 U.S .C.A. § 11 00 1, et seq.; (6 ) Clean Air Act of 1966, as amended by the Clean Air Act Am endm ents of 199 0, 42 U.S.C.A. §740 1, ct seq.; (7) National Environm ent al Poli cy Act of 197 0, as amended , 42 U.S.C .A. §432 1, et seq.; (8) Ri vers and Harb ors Act of 1899, as amended , 33 U.S.C.A. §401, ct seq .; (9) End angered Speci es Act of 197 3, as am end ed, 16 U.S.C.A.§153 1, ct seq.; (10) Occup ati onal Safety and Health Act of 1970, as amend ed, 29 U.S.C.A. §65 1, ct seq.; (11 ) Sa fe Drinking Water Act of 1974. as amended , 42 U.S.C.A . §300(0, et seq .; and (12) al: appli ca ble stand ard s, rul es , pol icies and other govern ment al requirement s. ·niere are no agree ments, co mmitmen ts or und erstandin gs by or betw ee n Landl ord and any third party pursuant to whi ch (i ) Landl ord agrees to make th e Premi ses part of any spec ial assessment s, spec ial di stri ct, or taxi ng di stri ct ("Ass essments"), or (ii ) Lan dl ord or its successo rs in int eres t arc required to se ll , grant c,r ded icate any part e,f th e Premi ses or to grant an y easement , water rights, right s-of- way , road or li cense for in gress and egress or oth er use in res pec t to an y part of th e Premi ses , wh ether on acco unt of th e deve lopm ent of adj ace nt or nearby real pro pe rt y or oth erwi se. La ndl ord has no know ledge of any Ass essme nt s be in g co nt empl ated. 33 that: L. Landlord has no knowledge of any fact , condition , or action, present, • contemplated , or threatened , which would or may result in the termination or impairment of access to and from the Premises as such access presently exists, and Landlord is not in , olation of any easements , righ ts-of-way, conditions, covenants and restrictions, licenses , or other agreements burdening the Premises. M. Landlord owns the Premises free and clear of any mortgage or deed of trust. 2. Represent atio ns of Tenant. Tenant represents , warrants and covenants to Landlord A. Tenant's Authority. Tenant is a duly constituted corporation organized under the laws of the State of Colorado, it has the power to enter into this Lease and perform Tenant's obligations hereunder; and the petwn executing thi s Lease on Tenant's behalf has the right and lawful authority to do so. B. Tenant's Covenant as to Hazardous ~•· Toxic Mat erials . i. Tenant hereby covenants that Tenant shall not cause or ;,ermit any "Hazardous Substances" (as hereinafter defined) to be placed, held, located or disposed of fo, on or at the Premi ses or any part thereof except in accordance with all appl :cable laws, statutes, ordinances , and regulations. ii. Tenant hereby agrees to indemnify Landlord and hold Landlord harmles s from and ag 11st any and all lo sses , li ab iliti es , damages, injuries, expenses, including reasonab le atturneys' fees , costs of any sett lement or judgment and claims of any and every kind whatsoever paid, incurred or suffered by, or asserted against, Landlord by any person or entity or governmental age ncy as a result of the escape, seepage, leakage, spillage, discharge, emission, discharging or release from, the Premises of any Hazardou s Substance , provided , however, that th e foregoing indemnity is limited to matters arising solely from Tenant's violation of the covenant contained in the preceding subparagraph 2.8.i. 111 . For purpo ses of this Lease, "Hazardous Substances" shall mean and include those elements or compounds which are contained in the list of hazardous substances now or hereafter adopted by the United States Environmental Protection Agency (the "EPA") or the list of toxic pollutants designated by Congress or the EPA or which are now or hereafter defined as hazardo us, toxic, pollutants, infectious or radi oactive by any other Federal , state or local statut e, law , ordinance, code, rule, rei,'lllation, order or decree regulating, relating to , or impo sing liabili ty or standJrd s of conduct concern in g, any hazardous, toxic or dangerou s waste, sub stance or material, as now or at any time hereafter in effect. "Hazardous Substances," for the purposes of thi ~ Paragraph 16 , shall include petroleum products, P.:;oes:os , and po lychlorinated biphenyls , and underground storage tanks unless installo<i, maintained, and closed in compliance with all applicable laws. 34 • • • • • iv. In th e event Hazardou s Substances are prese nt on the Premi es in violati on of Tenant 's covenant in subparagraph 2.B.i hereof, and Tenant fails to clean up , remove , resolve , minimi ze the impact of, or otherwise remediate such contamination in co mpliance with all applicable laws and rC!,'lllations and lo obtain a "no further action" or si milar closure letter from the governmen tal authorities with jurisdiction over such Hazardous Substances permitting the development and use of the Premi ses as contemp lated herein without further remediation (collectively, "Rernediate," which term sha ll includ e obtaining such approvals as are required from applicable governmental authorities prior to the commencement of Remediation activities on the Premises), then Landlord shall have th e right, but not the obligation, thirty (30) days after notice to Tenant and Tenant's failure to Rernediate , or, if Tenant cannot Rernediate within thirty (30) days, then upon Tenant's fai lure to commence preparation of a plan to Rernediate within such thirty (30) day period and diligently pursue the approval of such plan and the completiun of the remediation work authorized by the approved plan to completion , to enter upon the Premises to Remediate such contamination. Notwithstanding the foregoing, in no event shall Tenant be afforded more than two (2) years after the approval of Tenant's remediation plan by the appropriate governmental &gency or agencies, or any shorter time required fo r the completio n of such remediation by the agenci es in granting such approval , to comp lete such remediation . Tenant agrees to commence preparation of su ch plan promptly upon receipt of notice that such Hazardous Substances are present, to apply for approval of such plan promptly, and to pursue such approval diligently. All reasonable costs and expenses incurred by Landlord in the exercise of any such rights, which costs and expenses result from Tenant's violation of the covenants co ntained herein, shall be deemed Additional Rent under this Lease and shall be payable by Tenant upon demand . C. Douglas County Deposit. Tenant acknowledges that Landlord has made a refundable security deposit with Douglas County , Colorado in the amount of SJ 7,534.60 to secure that grading, erosion and storm sewer control is maintained according to the applicable governmental requirements ("GESC Deposit''). All refunds of the GESC Deposit shall be paid to Landlord. In there event there is a loss , in whole or in part, of the GESC Deposi t as a result of Tenant 's failure to maintain the Premises as required for a full refund of the GESC Depo sit, Tenant shall reim ,,urse Landlord for the amount of such loss. D. Broker . Tenant acknowledges that it has retained Fuller and Company as its real estate agent and broker an d agrees to pay Fuller and Company any and all compen sa.tion due it as a result of this transaction. Except for Fu ller and Company, each party hereby indemnifi es and agrees to hold the other party harmless from all damages, claims, liabiliti es or expenses, including reasonable and actual attorneys' fees (through al l levels of pro~eedings), resulting from any claims that may be asserted against the other party by any real es tate broker or finder with whom the indemnifying party either has or is purported to have dealt. Article 20 Ri gh! of First Offer 35 While this Lease is in effect and pro vided there is then no uncured De fa ult, in the event • Landlord desires to sell part or all of the Premises (which sale would otherwise be subject to thi s Ground Lease), Landlord hereby grants to Tenant a first right ("Right of First Offer") to purchase the Premises subject to and in accordance with the following provi sions : A. In the event Landlord desires to sell all or any portion of th e Premi ses , Lan dl ord sha ll first deliver to Tenant a written notice ("Offer Notice"). In the event Landlord desires t0 se ll less than all of the Premi ses, the Offer Notice shall include a description of the portion of the Premises it desires to sell. Tenant agrees to keep the infonnation contained in the Offer Notice confidential except to the extent necessary to disclo se to its lenders, accountants, attorneys and consultants in connection with Tenant 's response to the Offer Notice. B.. Tenant shall have twenty (20) days from receipt of the Offer Notice to give Landlord written notice (''Negotiation Notice'') of its desire to purchase such land . Within fifteen (I 5) days following receipt oftl1e Negotiation Notice, Landlord and Tenant shall enter into good faith negotiations for the purchase of the land described in the Offer Notice . If the parties are w1able to agree upon the terms of such and execute a purchase and sale agreement within thirty (30) days following receipt of the Negotiation Notice, the Right of First Offer shall expire and Landlord shall be free to sell such land to any other party, subject to the following additi onal terms and conditions contained in the follo :ving Par:..;raphs C and D. C. In the event Landlord receive s an offer within two (2)years following the Offer Notice which it desires to accept fr om a bona fide third party for a purch ase price of less than ninety percent (90%) of tt.e last price offered by Tenant during their prior negotia tion s held pursuant to this Article 20, prior to Landl ord entering into any binding agreement with such third party Landlord shall deliver to Tenant 3 written notice to Tenant, including a proposed purchase and sa le or lease agreement or Jetter of intent which Landlord is willing to accept from such third party, and Tenant shall have thirty (30) days , by written notice to Landlord ("Tenant's Purchase Notice"), to agree to pU!chase the such land on the same terms and conditions as set forth in the offer from such third party. Within twenty (20) days following Tenant's Purchase Notice, Landlord and Tenant shall enter into a binding purchase and sale agreement containing the agreed upon terms , including the same earnest money deposit and closing date . In the event Tenant fails to give Tenant's Purchase Notice within the required 30 days , Landlord shall have the right to complete the purchase and sale to the third party on substantially the same economic terms offered to Tenant , free of any claim by Tenant, but said purchase shall be subject to this Lease . D. In the event Landlord has failed to enter into a purchase and sale agreement for the sale of such land within two (2) year.; follo wing the Offer Notice and thereafter to consummate the sale of such land, the Right of Fi rs t Offer shall again be in full force and effect and any subsequent sale shall be subject to Tenant's prior Right of First Offer. 36 • • • • • E.. In no event shall a transfer of the Premi ses by Landlord to a party or an entity con tr olled by or con trollin g Land lord, or to a party or entit y affi liated with Landlord be subject to Tenant's Right of First Offer ; however such Right of First Offer shall rem ain in full fo rce and effect following such transfer .. F. During the term of thi s Lease, Tenant shall have the right , at Tenant 's so le cost, to repl at the Premis es from time to time into more than one lot, and including such other matters as reasonably approved by Landlord. Landlord agrees to reasonably coo perate with Tenant in such replating, provided there is no additional cost or liability to Landlord. [Remainder of thi s page intentional ly left blank] 37 IN WITNESS WHEREOF , th is Lease has been executed as of th e date writt en above. • LAN DLORD : CNGLEWOOD/MCLELLAN RESEVOIR FOUNDAT ION A Colorado non profit corporatio n By: President TENANT : TT DEN VE R, INC. a Co lorado corporation By : President 38 • • • EXl-l!BIT A-1 LEGAL DESCRil'TlO OF PREMJSES • • EXHIBIT A-2 • SITE PLAN OF PREMISES • • • • • EXHIBITS EXISTING TITLE EXCEPTIONS B•I EXHIBIT C MEMORANDUM OF LEASE • • • • • • COUNCIL COMMUNICATION Date : Agenda Item: Subject: October 19, 2009 11 Ci Resolution of Support to the Engl ewoo d/Mclellan Reservoir Foundation (EMRF) for Lease of Property to TT of Den ver, In c. Initiated By: I Staff Source: Englewood /Mclellan Reservoir Foundation Frank Grygl ew icz, EMRF Direc tor COUNCIL GOAL AND PREVIOUS COUNCIL ACTION In 1999, City Council authoriz~d the cr ea tion of the Englewood/Mclellan Reservoir Foundation (EM~'F.) On December 17, 2007, Council supported EMRF in th e sale of approximately 11 acres of PA85 to RTD for $3 .2 million . During an Executive Session of June 2, 2008, City Council reviewed the teoms of a Letter of Intent from TT of Denver to lease approximately 12.79 acres of Planning Area 84 (PA 84), and instructed EMRF to proceed with lease nego tiations . RECOMMENDED ACTION EMRF recommends Coun cil approve a resolution supporting the agreement between EMRF ard TT of Denver for lease of appro xi matel y 12.79 acres of PA84 . BACKGROUND In 1999, City Council authorized, through Ordinance 41 , the creation of the Englewood/Mclellan Reservoir Foundation , a non-profit corporation charged with furthering the development of the Mclellan Reservoir property and transferred the property to EMRF . Th e following goals for de velopment were established by City Council in Ordinance 41. I. Protect the quality of the City's stored wa ter at Mclellan Reservoir. 2. Protect the reservoir ecosystem . 3. Establish and maximiz e a future long-term incom e stream to benefit th e City. 4 . Maintain the quality of the Highline Canal recre ationa l facilities and the wetlands between C-470 and County Line Road. 5. Minimize deve lopment impacts on th e reservoir . 6. Enhance the quality of life of the neighborh oo d of which it is a part. 7. Enhance the quality of life for resi dents of the City of Englewood . With the recent development of the Ralph Schamp auto dealership east of the subject parcel , interest in EMRF property has focus ed on auto us es . EMRF has had on-going discus sions with TT of Den ver for lease of the subject parcel since January of 2008. TT of Denver is the parent co mpan y of lnfiniti of Littlet o n, which is seeking to relocate and approached EMRF regarding lease of th e subject parcel . At the prev ious Coun cil session, EMRF informed Council of th e terms of a Lett er of Intent and Council. by res olution, inst ructed EMRF to begi n neg otiations of final lease terms . Those negotia tion s ha ve been completed, ba se d on the ter ms of the Lett er of Int ent, with some additions whi ch will benefit EMR F and the City on a long-term ba sis . FINANCIAL IMPACT • Term: Initial term of tw enty years, wi th one renewa l opti on of ten ye ars and nine ren ewal • opti ons of fiv e years each thereafter. (Total poter,tial lease term of 75 years .) • Initial Dep osit : $200,000 , applicabl e to futu re rental pa yments . • Pre-D ev el opm ent Rent: Non-refundable monthl y payments of $10/''lO per month , commen ci ng upon executio n of le ase and co ntinuing until th e star of Constru ction Rent. • Constru cti on Ren t: $1 7,875 per month , co mm enci ng on June 1, 20 10. • Bas e Rent: Annual am ount of $428,992 commencing on the earlier of April 1, 2011 , or the date of opening to the public . Base rent shall increase by ten percent every five (5) years during th e inln.I20 year term and first (10 year) option period . At Lease Year 31 , the Base Rent shall be increased by the percentage Increase in the Consumer Price Index (CPI) from the lease commencement date to the current date, but in no event shall the rent be less than the Base Rent for the preceding lease year, nor more than 30% more than the Base Rent for the preceding lease year. Thereafter, rent will be adjusted with the CPI every five (5 ) years . UST OF ATTACHMENTS Res olution • •