OFFICE LEASE

Basic Lease Terms.

A.
REFERENCE DATE OF LEASE:
October 16, 2014
     
B.
TENANT:
CANNASYS, INC.,
   
a Colorado corporation
       
Address (For Notices):
1720 S. Bellaire Street, Suite 325
   
Denver, CO  80222
       
Email (For Notices):
dan@cannasys.com & chad@cannasys.com
     
C.
LANDLORD:
Denver Tower Equities LLC,
   
a Delaware limited liability company
       
Address (For Notices):
c/o Newmark Grubb Knight Frank
   
1720 S. Bellaire Street, Suite 106
   
Denver, CO   80222
   
Attn:  Tower Colorado Manager
 
Facsimile No.:
(303) 759-5684
       
With copy to:
c/o Felton Properties
   
520 SW 6th Ave, Suite 610
   
Portland, OR 97204
 
Facsimile No.:
(503) 227-2463
       
Address (For Rent Payments):
Denver Tower Equities LLC
   
c/o Newmark Grubb Knight Frank
   
PO Box 13797
   
Denver, CO  80201

D.           PREMISES AREA:  Approximately 1,786 rentable square feet (See
Exhibit “A”) with address of: 1720 S. Bellaire Street, Suite 325, Denver, CO
80222.  If desired by Tenant, rentable square footage of the Premises to be
verified by Tenant prior to Lease execution.

E.           TENANT’S PROPORTIONATE SHARE:  1.40%.  The percentage is obtained
by dividing the rentable square feet of the Premises by the total number of
rentable square feet of the Building.  Landlord may modify Tenant’s
Proportionate Share if the Building size is increased or decreased, as the case
may be.  The “Building” is the building commonly known as Tower Colorado.

F.           TENANT’S PERMITTED USE OF PREMISES:  General office use, and for no
other purpose.

G.
TERM OF LEASE:
Anticipated Commencement Date:  November 1, 2014
   
Expiration Date:  Last day of the month that is forty (40) months after the
Commencement Date of the Lease.

H.           BASE RENT:

Period (Months)
Annual Rate Per Square Foot
Monthly Base Rent
01 -- 04
$19.00
$0.00
05 -- 16
$19.00
$2,827.83
17 -- 28
$20.00
$2,976.67
29 -- 40
$21.00
$3,125.50

 
Page 1
 
 

--------------------------------------------------------------------------------

 

 
As reflected above, Tenant shall have no obligation to pay monthly Base Rent for
the first four (4) full months of the term, commencing with the Commencement
Date (the “Free Rent Period”) resulting in an abatement of monthly Base Rent in
the amount of $2,827.83 per month.  If the Lease is terminated during such Free
Rent Period, Tenant shall not be entitled to any such rent abatement after the
date of termination nor shall Tenant be entitled to assert any right to rent
abatement after such termination against any sums due Landlord.  The rent
abatement granted under this Section is solely for the benefit of the entity
executing this Lease as tenant and is not transferable to any assignee or
subtenant.  In the event of a default by Tenant under the terms of the Lease
which results in early termination pursuant to the provisions hereof, then as a
part of the recovery to which Landlord shall be entitled shall be included a
portion of such rent which was abated under the provisions of this Section,
which portion shall be determined by multiplying the total amount of rent which
was abated under this Section by a fraction, the numerator of which is the
number of months remaining in the term of the Lease at the time of such default
and the denominator of which is the number of months during the term of the
Lease that Tenant is obligated to pay monthly Base Rent.

I.             BASE YEAR:  REAL PROPERTY TAXES AND EXPENSES - 2014.

J.             PREPAID RENT:  $2,827.83, applicable to month five (5).

K.            SECURITY DEPOSIT: $12,502.00.

L.             MOVING ALLOWANCE:  Tenant shall receive a moving allowance equal
to $2.00 per rentable square foot of space in the Premises in accordance with
Exhibit B.

M.           BROKERS:  W. Ryan Stout, Nathan J. Bradley and Zachary T. Williams
of Cushman & Wakefield representing, Landlord.  Nathan Stern of The Zall
Company, representing Tenant.

For valuable consideration, Landlord and Tenant covenant and agree as follows:

1.1          Lease of Premises.
Landlord leases to Tenant the Premises described in the Basic Lease Terms and
shown on Exhibit “A” (the “Premises”) subject to the terms and conditions of
this Lease.

1.2          Delivery of Possession and Commencement.
Should Landlord be unable to deliver possession of the Premises on the
Anticipated Commencement Date stated in the Basic Lease Terms, Landlord shall
have no liability to Tenant for delay in delivering possession.  The term of the
Lease shall commence on the date the Premises are delivered to Tenant in the
condition required under this Lease (the “Commencement Date”).  The Expiration
Date of this Lease shall be the date stated in the Basic Lease Terms.  The
Premises shall be delivered to Tenant in “as is” condition and without any
representation or warranty, subject to any improvements to be performed by
Landlord in accordance with Exhibit “B.”  The existence of any “punch list” type
items shall not postpone the Commencement Date.  Tenant’s occupancy of the
Premises shall constitute conclusive acceptance of the amount of square footage
stated herein, and of the condition of the Premises.  If requested by Landlord,
Tenant shall confirm in writing the date of the Commencement Date and the
Expiration Date.

Page 2
 
 

--------------------------------------------------------------------------------

 

2.1          Rent Payment.
Tenant shall pay to Landlord the Base Rent for the Premises and any additional
rent provided herein, without deduction or offset.  At the same time as
execution of the Lease, Tenant shall pay any prepaid rent stated in the Basic
Lease Terms.  Rent is payable in advance on the first day of each month
commencing on the commencement date of this Lease.  Rent for any partial month
during the Lease term shall be prorated to reflect the number of days during the
month that Tenant occupies the Premises.  Additional rent means amounts
determined under Section 19 of this Lease and any other sums payable by Tenant
to Landlord under this Lease.  Rent not paid when due shall bear interest at the
rate of 1 1/2 percent per month, or if less the maximum applicable rate of
interest permitted by law, until paid.  Landlord may at its option impose a late
charge of the greater of $.05 for each $1 of rent or $50 for rent payments made
more than ten (10) days late in lieu of interest for the first month of
delinquency.  Tenant acknowledges that late payment by Tenant to Landlord of any
rent or other sums due under this Lease will cause Landlord to incur costs not
contemplated by this Lease, the exact amount of such costs being extremely
difficult and impracticable to ascertain, and that such late charge represents a
fair and reasonable estimate of the costs that Landlord will incur by reason of
any such late payment and is not a penalty.  Neither imposition nor collection
nor failure to impose or collect such late charge shall be considered a waiver
of any other remedies available for default.

3.1          Security Deposit.
Upon execution of the Lease, Tenant shall pay to Landlord the amount stated in
the Basic Lease Terms as a Security Deposit.  Provided that Tenant has not been
in default during the term of the Lease, Landlord shall apply $2,976.67 of the
Security Deposit to the seventeenth (17th) month of Base Rent then due and
payable and $3,125.50 of the Security Deposit to the twenty-ninth (29th) month
of Base Rent then due and payable, with the remaining balance of the Security
Deposit held by Landlord through the remainder of the Lease term.  Landlord may
apply the Security Deposit to pay the cost of performing any obligation which
Tenant fails to perform within the time required by this Lease, but such
application by Landlord shall not waive Landlord’s other remedies nor be the
exclusive remedy for Tenant’s default.  If the Security Deposit is applied by
Landlord, Tenant shall on demand pay the sum necessary to replenish the Security
Deposit to its original amount.  In no event will Tenant have the right to apply
any part of the Security Deposit to any rent or other sums due under this Lease,
except as expressly provided in this Section.  Landlord’s obligations with
respect to the Security Deposit are those of a debtor and not of a trustee, and
Landlord can commingle the Security Deposit with Landlord’s general
funds.  Landlord shall not be required to pay Tenant interest on the Security
Deposit.  If Landlord sells its interest in the Premises during the term hereof
and deposits with or credits to the purchaser the unapplied portion of the
Security Deposit, thereupon Landlord shall be discharged from any further
liability or responsibility with respect to the Security Deposit.

4.1          Use.
Tenant shall use the Premises for the Tenant’s Permitted Use stated in the Basic
Lease Terms and for no other purpose.  Tenant shall at its expense promptly
cause the Premises to comply with all applicable laws, ordinances, rules, and
regulations (“Laws”) and shall not annoy, obstruct, or interfere with the rights
of other tenants.  Tenant shall not allow any objectionable fumes, noise, light,
vibration, radiation, or electromagnetic waves to be emitted from the
Premises.  If any such sound or vibration is detectable outside of the Premises,
Tenant shall provide such insulation as is required to muffle such sound or
vibration and render it undetectable at Tenant’s cost.  Tenant shall not conduct
any activities that will increase Landlord’s insurance rates.  Tenant shall pay
before delinquency all taxes, assessments, license fees and public charges
levied, assessed or imposed upon its business operations and all trade fixtures,
leasehold improvements, merchandise and other personal property in or about the
Premises.

Page 3
 
 

--------------------------------------------------------------------------------

 

4.2          Equipment.
Tenant shall install in the Premises only such equipment as is customary for
Tenant’s Permitted Use and shall not overload the floors or electrical circuits
of the Premises or Building or alter the plumbing or wiring of the Premises or
Building.  Landlord must approve in advance the location of and manner of
installing any wiring or electrical, heat generating, climate sensitive, or
communication equipment or exceptionally heavy articles.  All telecommunications
equipment, conduit, cables and wiring, additional dedicated circuits, and any
additional air conditioning required because of heat generating equipment or
special lighting installed by Tenant shall be installed and operated at Tenant’s
expense and, at Landlord’s written request shall be removed by Tenant at
Tenant’s sole cost.  Tenant shall have no right to install any equipment on or
through the roof of the Building, or use or install or store any equipment or
other items outside of the interior boundary of the Premises.

4.3          Signs and Other Installations.
No signs, awnings, or other apparatus shall be painted on or attached to the
Building or anything placed on any glass or woodwork of the Premises or
positioned so as to be visible from outside the Premises, including any window
covering (e.g., shades, blinds, curtains, drapes, screens, or tinting materials)
without Landlord’s written consent.  All signs installed by Tenant shall comply
with Landlord’s standards for signs and all applicable codes and all signs and
sign hardware shall be removed upon termination of this Lease with the sign
location restored to its former state.  Tenant may not install any alarm boxes,
foil protection tape, or other security equipment on the Premises without
Landlord’s prior written consent.  Any material violating this provision may be
removed and disposed by Landlord without compensation to Tenant, and Tenant
shall reimburse Landlord for the cost of the same upon request.

4.4          Parking.
If Landlord provides parking spaces to all of the tenants of the Building,
Tenant may, at no additional cost to Tenant, use a proportionate share of
undesignated vehicle parking spaces, unreserved and unassigned, on those areas
designated by Landlord for such parking on the top deck of the Building or
across the street from the Building (four (4) parking spaces based on a ratio of
2.33 parking spaces per 1,000 rentable square feet of space in the
Premises).  Tenant shall not use more parking spaces than such number.  Such
parking spaces shall be used only for parking by vehicles no larger than full
sized passenger automobiles or pick-up trucks.  Tenant shall not permit or allow
any vehicles that belong to or are controlled by Tenant or Tenant’s employees,
suppliers, shippers, customers or invitees to be loaded, unloaded or parked in
areas other than those designated by Landlord for such activities.  If Tenant
permits or allows any of the prohibited activities described herein, then
Landlord shall have the right, without notice, in addition to such other rights
and remedies that it may have, to remove or tow away the vehicle involved and
charge the cost to Tenant, which cost shall be immediately payable as additional
rent upon demand by Landlord.  For all other parking spaces used by Tenant and
to the extent such parking spaces are made available by Landlord, Tenant shall
be required to pay as rental the established parking rates for the Building or
lot (as the case may be), as adjusted from time to time, and such sum shall be
additional rent payable under this Lease (such rates are currently
$75/space/month for covered reserved parking spaces, $55/space/month for covered
unreserved parking spaces, and $35/space/month for uncovered unreserved parking
spaces).

Page 4
 
 

--------------------------------------------------------------------------------

 

5.1          Utilities and Services.
Landlord shall operate or cause the operation of the heating, ventilating and
air-conditioning (“HVAC”) system serving the Premises during ordinary business
hours of Monday through Friday from 7:00 am to 6:00 pm and 8:00 am to 1:00 on
Saturday (“Ordinary Business Hours”) at such temperatures and in such amounts as
Landlord determines are reasonably required for the comfortable occupancy of the
Premises.  During other than Ordinary Business Hours, if Tenant so requests,
Landlord shall provide HVAC service to the Premises at Tenant’s sole cost and
expense in an amount equal to Landlord’s then scheduled hourly charge of
supplying HVAC to the Premises.  Janitorial service will be provided in
accordance with the regular schedule of the Building, which schedule and service
may change from time to time.  Tenant shall promptly pay when due all charges
for utility services used in the Premises and for all other services required
for Tenant’s use of the Premises.  Tenant shall comply with all government laws
or regulations regarding the use or reduction of use of utilities on the
Premises.  Interruption of services or utilities shall not be deemed an eviction
or disturbance of Tenant’s use and possession of the Premises, render Landlord
liable to Tenant for damages, or relieve Tenant from performance of Tenant’s
obligations under this Lease.  Landlord shall take all reasonable steps to
correct any interruptions in service caused by defects in utility systems within
Landlord’s reasonable control.  Tenant shall provide its own surge protection
for power furnished to the Premises.  Tenant shall cooperate with Landlord and
the utility service providers at all times as reasonably necessary, and shall
allow Landlord and utility service providers, reasonable access to the pipes,
lines, feeders, risers, wiring, and any other machinery within the
Premises.  Tenant shall not contract or engage any other utility provider
without prior written approval of Landlord.

5.2          Security.
Landlord may (but shall have no obligation) adopt security measures regarding
the Premises, and Tenant shall cooperate with all such security
measures.  Landlord may modify the type or amount of security measures provided
at any time without notice.  Tenant may install a security system within the
Premises with Landlord’s written consent (not to be unreasonably
withheld).  Landlord shall be given an access code to any security system and
shall not have any liability for accidentally setting off Tenant’s security
system.

6.1          Maintenance and Repair.
6.1.1           Subject to reimbursement under Section 19, Landlord shall
maintain and repair in good condition the Building structure, roof, exterior
walls and doors, exterior windows, and common areas of the Building, and the
electrical, mechanical, plumbing, heating and air conditioning systems,
facilities and components located in the Building that are used in common by all
tenants of the Building.  Tenant shall maintain and repair the Premises in good
condition, including, without limitation, maintaining and repairing all walls,
floors, and ceilings, all interior doors, partitions, and windows, and all
Premises systems, fixtures, and equipment that are not the maintenance
responsibility of Landlord, as well as damage caused by Tenant, its agents,
employees, contractors, or invitees.

6.1.2           Landlord shall have no liability for failure to perform required
maintenance and repair unless written notice is given by Tenant and Landlord
fails to commence efforts to remedy the problem in a reasonable time.  Landlord
shall have the right to erect scaffolding and other apparatus necessary for the
purpose of making repairs or alterations to the Building, and Landlord shall
have no liability for interference with Tenant’s use because of such work.  Work
may be done during normal business hours.  Tenant shall have no claim against
Landlord for any interruption of services or interference with Tenant’s
occupancy caused by Landlord’s maintenance and repair or any claim of
constructive or other eviction of Tenant.

Page 5
 
 

--------------------------------------------------------------------------------

 

6.2          Alterations.
Tenant shall not make any alterations to the Premises that affect the structure
of the Building or any Building system (electrical, plumbing, mechanical or life
safety), or install any wall or floor covering without Landlord’s prior written
consent which may be withheld in Landlord’s sole discretion.  With respect to
any other alteration requested by Tenant, Landlord’s consent shall not be
unreasonably withheld.  Should Landlord consent in writing to Tenant’s
alteration of the Premises, Tenant shall contract with a contractor approved by
Landlord for the construction of such alterations, shall secure all appropriate
governmental approvals and permits, and shall complete such alterations with due
diligence in compliance with the plans and specifications approved by
Landlord.  All such construction shall be performed in a manner which will not
interfere with the quiet enjoyment of other tenants of the Building.  Any such
alterations, wiring, cables, or conduit installed by Tenant shall at once become
part of the Premises and belong to Landlord except for removable machinery and
unattached movable trade fixtures.  Landlord may at its option require that
Tenant remove any alterations, wiring, cables or conduit installed by or for
Tenant and restore the Premises to the original condition upon termination of
this Lease.  Landlord shall have the right to post notices of nonresponsibility
in connection with work being performed by Tenant in the Premises.  Work by
Tenant shall comply with all laws then applicable to the Premises.  Tenant shall
not allow any liens to attach to the Building or Tenant’s interest in the
Premises as a result of its activities or any alterations.  Landlord may perform
alterations to or change the configuration of the Building, the Building, the
parking area, and other common areas.

7.1          Indemnity.
Tenant shall indemnify, defend, and hold harmless Landlord and its managing
agents and employees from any claim, liability, damage, or loss occurring in,
on, or about the Premises, or any cost or expense in connection therewith
(including attorney fees), arising out of (a) any bodily damage to any person or
damage to property occurring in, on, or about the Premises, (b) use by Tenant or
its agents, invitees or contractors of the Premises and/or the Building, and/or
(c) Tenant’s breach or violation of any term of this Lease.  This indemnity
obligation shall survive the expiration or sooner termination of this Lease.

7.2          Insurance.
Tenant shall carry liability insurance on an “occurrence” basis with limits of
not less than Three Million Dollars ($3,000,000) combined single limit bodily
injury and property damage which insurance shall have an endorsement naming
Landlord and Landlord’s managing agent, if any, as an additional insured, cover
the liability insured under Section 7.1 of this Lease, shall have deductibles of
not more than $2,500.00 and shall be in form and with companies reasonably
acceptable to Landlord.  Such insurance shall provide that it is primary
insurance and not “excess over” or contributory with any other valid, existing
and applicable insurance in force for or on behalf of Landlord.  The policy
shall not eliminate cross-liability and shall contain a severability of interest
clause.  Tenant, at its cost, shall maintain on all of its personal property,
tenant improvements (whether constructed by Landlord or Tenant), in, on, or
about the Premises, a policy of “Broad Form” insurance, to the extent of at
least full replacement value without any deduction for depreciation.  No policy
of insurance shall be written such that the proceeds thereof will produce less
than the minimum coverage required hereunder by reason of co-insurance
provisions or otherwise.  Tenant, at its cost, shall maintain such other
insurance as Landlord may reasonably require from time to time.  Not more
frequently than once each year, if, in the opinion of Landlord’s lender or of
the insurance consultant, the amount of public liability and property damage
insurance coverage at that time is not adequate, Tenant shall increase the
insurance coverage as required by either Landlord’s lender or Landlord’s
insurance consultant.  Prior to occupancy, Tenant shall furnish a certificate
evidencing such insurance which shall state that the coverage shall not be
canceled or materially changed without thirty (30) days’ advance notice to
Landlord and Landlord’s managing agent, if any.  Tenant shall furnish to
Landlord a renewal certificate at least thirty (30) days prior to expiration of
any policy.

Page 6
 
 

--------------------------------------------------------------------------------

 

8.1          Fire or Casualty.
“Major Damage” means damage by fire or other casualty to the Building or the
Premises which causes the Premises or any substantial portion of the Building to
be unusable, or which will cost more than 25 percent of the pre damage value of
the Building to repair, or which is not covered by insurance.  In case of Major
Damage, Landlord may elect to terminate this Lease by notice in writing to the
Tenant within thirty (30) days after such date.  If this Lease is not terminated
following Major Damage, or if damage occurs which is not Major Damage, Landlord
shall promptly restore the Premises to the condition existing just prior to the
damage.  Tenant shall promptly restore all damage to tenant improvements or
alterations installed or paid for by Tenant or pay the cost of such restoration
to Landlord if Landlord elects to do the restoration of such
improvements.  Unless the casualty was caused by Tenant, rent shall be reduced
from the date of damage until the date restoration work being performed by
Landlord is substantially complete, with the reduction to be in proportion to
the area of the Premises not usable by Tenant.

8.2          Waiver of Subrogation.
Tenant shall be responsible for insuring its personal property and trade
fixtures located on the Premises and any alterations or tenant improvements it
has made to the Premises.  Neither Landlord, its managing agent nor Tenant shall
be liable to the other for any loss or damage caused by water damage, sprinkler
leakage, or any of the risks that are covered by property insurance or could be
covered by a customary broad form of property insurance policy, or for any
business interruption, and there shall be no subrogated claim by one party’s
insurance carrier against the other party arising out of any such loss.

9.1          Eminent Domain.
If a condemning authority takes title by eminent domain or by agreement in lieu
thereof a portion sufficient to render the Premises unsuitable for Tenant’s use,
then either party may elect to terminate this Lease effective on the date that
possession is taken by the condemning authority.  If this Lease is not
terminated, then rent shall be reduced for the remainder of the term in an
amount proportionate to the reduction in area of the Premises caused by the
taking.  All condemnation proceeds shall belong to Landlord, and Tenant shall
have no claim against Landlord or the condemnation award because of the taking.

10.1        Assignment and Subletting.
Tenant shall not assign or encumber its interest under this Lease or sublet all
or any portion of the Premises without first obtaining Landlord’s consent in
writing.  This provision shall apply to all transfers by operation of law, and
to all mergers and changes in control of Tenant, all of which shall be deemed
assignments for the purposes of this Section.  No assignment shall relieve
Tenant of its obligation to pay rent or perform other obligations required by
this Lease, and no consent to one assignment or subletting shall be a consent to
any further assignment or subletting.  If Tenant proposes a subletting or
assignment for which Landlord’s consent is required, Landlord shall have the
option of terminating this Lease and dealing directly with the proposed
subtenant or assignee, or any third party.  Notwithstanding the
foregoing,  Landlord may at its sole discretion withhold consent to the
subletting or assignment of the Premises to an existing occupant of the
Building, to any prospective tenant with which the Landlord or Landlord’s agents
have negotiated within the previous six (6) months, or where any sublease will
require any changes to any building systems.  Tenant shall not advertise at a
rate which is less than the Building’s listed rate.  If Landlord does not
terminate this Lease, Landlord shall not unreasonably withhold its consent to
any assignment or subletting provided the effective rental paid by the subtenant
or assignee is not less than the current scheduled rental rate of the Building
for comparable space and the proposed Tenant is compatible with Landlord’s
normal standards for the Building.  If an assignment or subletting is permitted,
any cash net profit, or the net value of any other consideration received by
Tenant as a result of such transaction shall be paid to Landlord promptly
following its receipt by Tenant.  Tenant shall pay any costs incurred by
Landlord in connection with a request for assignment or subletting, including
reasonable attorney fees.
 
Page 7
 
 

--------------------------------------------------------------------------------

 

11.1        Default.
Any of the following shall constitute an Event of Default by Tenant under this
Lease (time of performance being of the essence of this Lease):

11.1.1        Tenant’s failure to pay rent or any other charge under this Lease
when due.

11.1.2        Tenant’s failure to comply with any other term or condition within
ten (10) days following written notice from Landlord specifying the
noncompliance.  If such noncompliance cannot be cured within the ten (10) day
period, this provision shall be satisfied if Tenant commences correction within
such period and thereafter proceeds in good faith and with reasonable diligence
to complete correction as soon as possible but not later than ninety (90) days
after the date of Landlord’s notice.

11.1.3        Assignment or subletting by Tenant in violation of Section 10.1.

11.2        Remedies for Default.
Upon occurrence of an Event of Default as described in Section 11.1, Landlord
shall have the right to the following remedies, which are intended to be
cumulative and in addition to any other remedies provided under applicable law
or under this Lease:

11.2.1         Landlord may at its option terminate this Lease, without
prejudice to its right to damages for Tenant’s breach.  With or without
termination, Landlord may retake possession of the Premises and may use or relet
the Premises without accepting a surrender or waiving the right to
damages.  Following such retaking of possession, efforts by Landlord to relet
the Premises shall be sufficient if Landlord follows its usual procedures for
finding tenants for the space at rates not less than the current rates for other
comparable space in the Building.  If Landlord has other vacant space in the
Building, prospective tenants may be placed in such other space without
prejudice to Landlord’s claim to damages or loss of rentals from Tenant.

11.2.2.        Landlord may recover all damages caused by Tenant’s default which
shall include an amount equal to rentals lost because of the default, Lease
commissions paid for this Lease, and the unamortized cost of any tenant
improvements installed by or paid for by Landlord.  Landlord may sue
periodically to recover damages as they occur throughout the Lease term, and no
action for accrued damages shall bar a later action for damages subsequently
accruing.  Landlord may elect in any one action to recover accrued damages plus
damages attributable to the remaining term of the Lease.  Such damages shall be
measured by the difference between the rent under this Lease and the reasonable
rental value of the Premises for the remainder of the term, discounted to the
time of judgment at the prevailing interest rate on judgments.

11.3        Landlord’s Right To Cure Default.
Landlord may, but shall not be obligated to, make any payment or perform any
obligation which Tenant has failed to perform under this Lease.  All of
Landlord’s expenditures shall be reimbursed by Tenant upon demand with interest
from the date of expenditure at the rate of 1 1/2 percent per month.  Landlord’s
right to correct Tenant’s failure to perform is for the sole protection of
Landlord and the existence of this right shall not release Tenant from the
obligation to perform all of the covenants herein required to be performed by
Tenant, or deprive Landlord of any other right which Landlord may have by reason
of default of this Lease by Tenant, whether or not Landlord exercises its right
under this Section.

Page 8
 
 

--------------------------------------------------------------------------------

 

12.1        Surrender; Holdover.
On expiration or early termination of this Lease, Tenant shall deliver all keys
to Landlord and surrender the Premises vacuumed, swept, and free of debris and
in the same condition as at the commencement of the term subject only to
reasonable wear from ordinary use.  Tenant shall remove all of its furnishings
and trade fixtures that remain its property and any alterations, cables, or
conduits if required by Section 6.2, and shall repair all damage resulting from
such removal.  Failure to remove shall be an abandonment of the property, and,
following ten (10) days’ written notice, Landlord may remove or dispose of it in
any manner without liability, and recover the cost of removal and other damages
from Tenant.  If Tenant fails to vacate the Premises when required, including
failure to remove all its personal property, Landlord may elect either:  (i) to
treat Tenant as a tenant from month to month, subject to the provisions of this
Lease except that rent shall be one and one half times the total rent being
charged when the Lease term expired, and any option or other rights regarding
extension of the term or expansion of the Premises shall no longer apply; and/or
(ii) to eject Tenant from the Premises (using self-help or otherwise) and
recover damages caused by wrongful holdover.

13.1        Rules and Regulations.
Landlord shall have the right to make, revise and enforce rules and regulations
for the Building.  All such rules and regulations including those, if any,
attached to this Lease, shall be complied with as if part of this Lease and
failure to comply shall be a default.

14.1        Access.
Tenant shall have access to the Building twenty-four (24) hours a day, seven (7)
days a week; provided that Tenant’s officers and employees or those having
business with Tenant may be required to identify themselves or show passes in
order to gain access to the Building.  Landlord shall have no liability for
permitting or refusing to permit access by anyone.  Landlord may regulate access
to any Building elevators.  Landlord shall have the right to enter upon the
Premises at any time by passkey or otherwise to determine Tenant’s compliance
with this Lease, to perform necessary services, maintenance and repairs or
alterations to the Building or the Premises, to post notices of
nonresponsibility, or to show the Premises to any prospective tenant or
purchasers.  Except in case of emergency, such entry shall be at such times and
in such manner as to minimize interference with the reasonable business use of
the Premises by Tenant.

14.2        Furniture and Bulky Articles.
Tenant shall move furniture and bulky articles in and out of the Building or
make independent use of any elevators only at times approved by Landlord
following at least 24 hours’ written notice to Landlord.

15.1        Notices.
Notices between the parties relating to this Lease shall be in writing,
effective when delivered during business hours by facsimile transmission, hand
delivery, private courier, or first class or certified U.S. mail.  Notices shall
be delivered postage prepaid, to the address or facsimile number for the party
stated in the Basic Lease Terms or to such other address as either party may
specify by notice to the other.  Notice to Tenant may always be delivered to the
Premises.  Rent shall be payable to Landlord at the same address and in the same
manner, but shall be considered paid only when received.

Page 9
 
 

--------------------------------------------------------------------------------

 

16.1        Subordination and Attornment.
This Lease shall be subject to and subordinate to any mortgages, deeds of trust,
ground lease, master lease, or land sale contracts (hereafter collectively
referred to as encumbrances) now existing against the Building.  At Landlord’s
option this Lease shall be subject and subordinate to any future encumbrance,
ground lease, or master lease hereafter placed against the Building (including
the underlying land) or any modifications of existing encumbrances, and Tenant
shall execute such documents as may reasonably be requested by Landlord or the
holder of the encumbrance to evidence this subordination within 10 days of
request therefor.  If any encumbrance is foreclosed, then if the purchaser at
foreclosure sale gives to Tenant a written agreement to recognize Tenant’s
Lease, Tenant shall attorn to such purchaser and this Lease shall continue.

16.2        Transfer of Building.
If the Building is sold or otherwise transferred by Landlord or any successor,
Tenant shall attorn to the purchaser or transferee and recognize it as the
landlord under this Lease, and, provided the purchaser or transferee assumes all
obligations under this Lease thereafter accruing, the transferor shall have no
further liability hereunder.

16.3        Estoppels.
Either party will within ten (10) days after notice from the other execute,
acknowledge, and deliver to the other party a certificate certifying whether or
not this Lease has been modified and is in full force and effect; whether there
are any modifications or alleged breaches by the other party; the dates to which
rent has been paid in advance, and the amount of any security deposit or prepaid
rent; and any other facts that may reasonably be requested.  If requested by the
holder of any encumbrance, or any underlying lessor, Tenant will agree to give
such holder or lessor notice of and an opportunity to cure any default by
Landlord under this Lease.

17.1        Attorney Fees.
In any litigation arising out of this Lease, including any bankruptcy
proceeding, the prevailing party shall be entitled to recover attorney fees at
trial and on any appeal or petition for review.  If Landlord incurs attorney
fees because of a default by Tenant, Tenant shall pay all such fees whether or
not litigation is filed.  If Landlord employs a collection agency to recover
delinquent charges, Tenant agrees to pay all collection agency and other fees
charged to Landlord in addition to rent, late charges, interest, and other sums
payable under this Lease.

18.1        Quiet Enjoyment.
Landlord warrants that as long as Tenant complies with all terms of this Lease,
it shall be entitled to possession of the Premises free from any eviction or
disturbance by Landlord or parties claiming through Landlord.

18.2        Limitation on Liability.
Notwithstanding any provision in this Lease to the contrary, neither Landlord
nor its managing agent or employees shall have any liability to Tenant for loss
or damages to Tenant’s property from any cause, nor arising out of the acts of
other tenants of the Building or third parties, nor any liability for
consequential damages, nor liability for any reason which exceeds the value of
its interest in the Building.

Page 10
 
 

--------------------------------------------------------------------------------

 

19.1        Additional Rent:  Operating Expense Adjustment.
Tenant shall pay as additional rent Tenant’s Proportionate Share of the amount
by which operating expenses and real property taxes for the Building increase
over those experienced by Landlord during the Base Year for expenses stated in
the Basic Lease Terms.  Effective January 1 of each year Landlord shall estimate
the amount by which operating expenses and real property taxes are expected to
increase, if any, over those incurred in the base year.  Monthly rent for that
year shall be increased by one twelfth of Tenant’s Proportionate Share of
operating expenses and real property taxes, provided that Landlord may revise
its estimate during any year with reasonable cause and the additional estimate
shall be payable as equal additions to rent for the remainder of the calendar
year.  Following the end of each calendar year, Landlord shall compute Tenant’s
actual Proportionate Share of operating expenses and real property taxes and
bill Tenant for any deficiency or credit Tenant with any excess
collected.  Tenant shall pay any such deficiency within thirty (30) days after
Landlord’s billing, whether or not this Lease shall have expired or terminated
at the time of such billing.  As used herein “real property taxes” as used
herein shall mean all taxes and assessments of any public authority against the
Building and the land on which it is located, the cost of contesting any tax and
any form of fee or charge imposed on Landlord as a direct consequence of owning
or leasing the Premises, including but not limited to, rent taxes, gross receipt
taxes, leasing taxes, or any fee or charge wholly or partially in lieu of or in
substitution for ad valorem real property taxes or assessments, whether now
existing or hereafter enacted.  If a separate assessment or identifiable tax
increase arises because of improvements to the Premises, then Tenant shall pay
100 percent of such increase.  As used herein, “operating expenses” shall mean
all costs of operating, maintaining, managing, replacing and repairing the
Building as determined by standard real estate accounting practice, including,
but not limited to:  all water and sewer charges; the cost of natural gas and
electricity provided to the Building; janitorial and cleaning supplies and
services; administration costs and management fees; superintendent fees;
security services, if any; insurance premiums; licenses, permits for the
operation and maintenance of the Building and all of its component elements and
mechanical systems; ordinary and emergency repairs and maintenance, and the
annual amortized capital improvement cost (amortized over such a period as
Landlord may select but not shorter than the period allowed under the Internal
Revenue Code and at a current market interest rate) for any capital improvements
to the Building.  “Operating expenses” shall also include all assessments under
recorded covenants or master plans and/or by owner’s associations.

“Operating expenses” additional rent shall exclude: (a) costs or expenses of
providing or performing improvements, work, renovations, decorating, painting,
or repairs to or within any portion of the premises of any other tenants or
occupants of the Building or Project; (b) costs or expenses incurred as a result
of disputes or negotiations with other tenants or occupants of the Property,
including, but not limited to attorney’s fees; (c)  any costs or expenses
incurred in negotiating, amending, administering or terminating leases, any
brokerage commissions, or construction or planning expenses; (d) fines, interest
and penalties incurred due to the late payment of Taxes by Landlord; (e)
salaries of personnel of Landlord above the level of building manager; (f) the
cost of any environmental remediation of the Project or the Building, including
without limitation any costs incurred to test, survey, cleanup, contain, abate,
remove, or otherwise remedy hazardous wastes or asbestos-containing materials
from the Building or Project; (g) costs incurred in connection with the sale,
financing or refinancing of the Building or Project; and (h) depreciation and
amortization, including but not limited to depreciation of structures or
buildings located in the Project, including the Building.

Page 11
 
 

--------------------------------------------------------------------------------

 

19.2        Disputes.
If Tenant disputes any computation of additional rent Section 19.1, it shall
give notice to Landlord not later than thirty (30) days after the notice from
Landlord describing the computation in question, but in any event not later than
(thirty) 30 days after expiration or earlier termination of this Lease.  If
Tenant fails to give such a notice, the computation by Landlord shall be binding
and conclusive between the parties for the period in question.  If Tenant gives
a timely notice, the dispute shall be resolved by an independent CPA selected by
Landlord whose decision shall be conclusive between the parties.  Each party
shall pay one-half of the fee of such CPA for making such determination except
that if the adjustment in favor of Tenant does not exceed 10 percent of the
escalation amounts for the year in question, Tenant shall pay (i) the entire
cost of any such third-party determination; and (ii) Landlord’s out-of-pocket
costs and reasonable expenses for personnel time in responding to the
audit.  Nothing herein shall reduce Tenant’s obligations to make all payments as
required by this Lease.  In no event shall Landlord have any liability to Tenant
based on its calculation of additional rent or rent adjustments except and only
the obligation to cause any correction to be made pursuant to this Section
19.2.  Tenant shall maintain as strictly confidential the existence and
resolution of any dispute regarding rent charges hereunder.

20.1        Hazardous Materials.
Neither Tenant nor Tenant’s agents or employees shall cause or permit any
Hazardous Material, as hereinafter defined, to be brought upon, stored, used,
generated, released into the environment, or disposed of on, in, under, or about
the Premises, except reasonable quantities of cleaning supplies and office
supplies necessary to or required as part of Tenant’s business that are
generated, used, kept, stored, or disposed of in a manner that complies with all
laws regulating any such Hazardous Materials and with good business
practices.  Tenant covenants to remove from the Premises (or the Building, if
applicable), upon the expiration or sooner termination of this Lease and at
Tenant’s sole cost and expense, any and all Hazardous Materials brought upon,
stored, used, generated, or released into the environment during the term of
this Lease.  To the fullest extent permitted by law, Tenant hereby agrees to
indemnify, defend, protect, and hold harmless Landlord, Landlord’s managing
agent and their respective agents and employees, and their respective successors
and assigns, from any and all claims, judgments, damages, penalties, fines,
costs, liabilities, and losses that arise during or after the term directly or
indirectly from the use, storage, disposal, release, or presence of Hazardous
Materials on, in, or about the Premises which occurs during the term of this
Lease.  Tenant shall promptly notify Landlord of any release of Hazardous
Materials in, on, or about the Premises that Tenant or Tenant’s agents or
employees become aware of during the Term of this Lease, whether caused by
Tenant, Tenant’s agents or employees, or any other persons or entities.  As used
herein, the term “Hazardous Materials” shall mean any hazardous or toxic
substance, material, or waste which is or becomes regulated by any local or
state governmental authority or the United States Government.  The term
“Hazardous Materials” shall include, without limitation, any material or
substance that is (i) defined as a “hazardous waste,” “extremely hazardous
waste,” “restricted hazardous waste,” “hazardous substance,” “hazardous
material,” or “waste” under any federal, state, or local law, (ii) petroleum,
and (iii) asbestos.  The provisions of this Section 20, including, without
limitation, the indemnification provisions set forth herein, shall survive any
termination of this Lease.

21.1        Complete Agreement; No Implied Covenants.
This Lease constitutes the entire agreement of the parties and supersedes all
prior written and oral agreements and representations and there are no implied
covenants or other agreements between the parties except as expressly set forth
in this Lease.  Neither Landlord nor Tenant is relying on any representations
other than those expressly set forth herein.

Page 12
 
 

--------------------------------------------------------------------------------

 

21.2        Nonwaiver.
Failure by Landlord to promptly enforce any regulation, remedy, or right of any
kind under this Lease shall not constitute a waiver of the same and such right
or remedy may be asserted at any time after Landlord becomes entitled to the
benefit thereof notwithstanding delay in enforcement.

21.3        Force Majeure.
If performance by Landlord of any portion of this Lease is made impossible by
any prevention, delay, or stoppage caused by governmental approvals, war, acts
of terrorism, strikes, lockouts, labor disputes, acts of God, inability to
obtain services, labor, or materials or reasonable substitutes for those items,
governmental actions, civil commotions, fire or other casualty, or other causes
beyond the reasonable control of Landlord, performance by Landlord for a period
equal to the period of that prevention, delay, or stoppage is excused.

21.4        Commissions.
Each party represents that it has not had dealings with any real estate broker,
finder, or other person with respect to this Lease in any manner, except for the
brokers identified in the Basic Lease Terms.  Landlord shall pay a leasing
commission in accordance with a separate agreement between Landlord and broker.

21.5        Successors.
Subject to Section 10.1, this Lease shall bind and inure to the benefit of the
parties, their respective heirs, successors, and permitted assigns.

21.6        Financial Reports.
In no manner will Tenant provide to Landlord Tenant’s financial statements
outside of what is legally allowed by the Securities and Exchange Commission
(SEC), unless court ordered or approved by SEC.  Tenant’s financials are public
record and conform with SEC filing requirements.  If at any time Tenant’s
financials are not part of the public record, then within ten (10) days after
Landlord’s request, Tenant will furnish Tenant’s most recent financial
statements to Landlord.  Landlord will not disclose any aspect of Tenant’s
financial statements except (1) to Landlord’s lenders or prospective purchasers
of the Building who have executed a sales contract with Landlord, (2) in
litigation between Landlord and Tenant, or (3) if required by court order.

21.7        Waiver of Jury Trial.
To the maximum extent permitted by law, Landlord and Tenant each waive right to
trial by jury in any litigation arising out of or with respect to this Lease.

21.8        Executive Order 13224.
Tenant hereby certifies all persons or entities holding any legal or beneficial
interest whatsoever in Tenant are not included in, owned by, controlled by,
acting for or on behalf of, providing assistance, support, sponsorship, or
services of any kind to, or otherwise associated with any of the persons or
entities referred to or described in Executive Order 13224 - Blocking Property
and Prohibiting Transactions with Persons Who Commit, Threaten to Commit, or
Support Terrorism, as amended.

Page 13
 
 

--------------------------------------------------------------------------------

 

21.9        Relocation.
Landlord shall have the right at any time during the Term of this Lease to
require the Tenant to relocate to other space in the Building (hereinafter
referred to as “Substitution Space”).  The Substitution Space shall have
approximately the same rentable square footage as the Premises.  If Landlord
desires to exercise such right, Landlord shall give Tenant not less than sixty
(60) days prior written notification that Tenant is to relocate to another
space.  Landlord shall pay for all reasonable costs directly related to such
relocation, including all reasonable costs and expenses related to improving the
space with leasehold improvements equal to those then in Tenant’s
Premises.  After such relocation, all terms, covenants, conditions, provisions,
and agreements of this Lease shall continue in full force and effect and shall
apply to the Substitution Space except that if the Substitution Space contains
more square footage than the presently leased Premises, the monthly rental shall
be increased proportionately.  If Tenant shall retain possession of the Premises
or any part thereof following the date set for relocation or termination, Tenant
shall be liable to Landlord, for each day of such retention, for double the
amount of the daily rental for the last period prior to the date of such
expiration or termination, plus actual damages incurred by Landlord resulting
from delay by Tenant in surrendering the Premises, including, without
limitation, any claims made against Landlord by any succeeding tenant to the
Premises and Landlord’s costs in taking any action to evict Tenant from the
Premises.

21.10      Confidentiality.
Landlord and Tenant shall keep the content and all copies of this Lease, all
related documents and amendments, and all proposals, materials, information
(including but not limited to rental terms, rent abatement, construction
allowance, and any other concessions or terms of the business deal), and matters
relating hereto strictly confidential and shall not disclose, divulge,
disseminate or distribute any of the same, or permit the same to occur, except
to the extent reasonably required for proper business purposes by Landlord’s or
Tenant’s employees, attorneys, agents, insurers, auditors, lenders and permitted
successors and assigns (and Landlord shall obligate any such parties to whom
disclosure is permitted to honor the confidentiality provisions hereof) and
except as may be required by law or court proceedings.  This confidentiality
provision shall be binding upon the parties hereto and their respective
successor and assigns and shall survive the expiration of this Lease.  Tenant
and its representatives shall be prohibited from issuing any press release(s) or
communicating with the media regarding the proposed or agreed to transaction, in
which the Tenant has not received prior written authorization from Landlord.

21.11      Signs.
Landlord shall include Tenant’s name on the Building directory signage and shall
provide Tenant with standard suite entry signage at Landlord’s cost.

21.12.     Exhibits.
The Exhibits A (Premises), B (Work Agreement), and C (Rules and Regulations) are
attached hereto and incorporated as a part of this Lease.

Page 14
 
 

--------------------------------------------------------------------------------

 

IN WITNESS WHEREOF, the duly authorized representatives of the parties have
executed this Lease as of the day and year first written above.

LANDLORD:
DENVER TOWER EQUITIES LLC, a Delaware limited liability company
     
By: Denver Tower SPE LLC, a Delaware limited liability company, its sole Member
     
By: Denver Tower Holding LLC, a Delaware limited liability company,
its Managing Member
     
By: /s/ Jeffrey Borlang
 
Jeffrey Borlang, Authorized Signatory
   
TENANT:
CANNASYS, INC., a Colorado corporation
     
By: /s/ Brandon Jennewine
 
Brandon Jennewine, CEO

Page 15
 
 

--------------------------------------------------------------------------------

 

EXHIBIT “A”

Premises

[suite325.jpg]
 
 

Page 16
 
 

--------------------------------------------------------------------------------

 

EXHIBIT “B”

Work Agreement

Except as provided below, Tenant is leasing the Premises in its “as is”
condition and Landlord shall have no obligation to make any improvements to the
Premises; provided, however, Landlord shall provide Tenant with a moving
allowance in the amount equal to $2.00 per rentable square foot of space in the
Premises for actual third party moving costs incurred by Tenant, which moving
allowance shall be paid to Tenant within thirty (30) days of delivery to
Landlord of paid invoices for such actual third party moving costs.   Using such
standard Building materials as Landlord deems reasonably necessary or
appropriate, Landlord shall:

1.           Install one (1) sink in the break room;
2.           Paint the Premises; and
3.           Install new carpet.

Page 17
 
 

--------------------------------------------------------------------------------

 

EXHIBIT “C”

Rules & Regulations

1.           The driveways, parking lots, sidewalks, halls, passages, exits,
vestibules, entrances, public areas, elevators and stairways of the Building
shall not be obstructed by any Tenants or used by them for any purpose other
than ingress to and egress from their respective Premises.  No Tenant and no
employee or invitee of any Tenant shall go upon the roof of the Building.  If
the Premises are situated on the ground floor with direct access to the street,
then Tenant shall, at Tenant’s expense, keep the sidewalks and curbs directly in
front of the Premises clean and free from dirt, refuse and other obstructions.

2.           No sign, placard, picture, name, advertisement or notice visible
from the exterior of any Tenant’s Premises shall be inscribed, painted, affixed
or otherwise displayed by any Tenant on any part of the Building without the
prior written consent of Landlord.  Landlord shall, at Landlord’s cost, place
Tenant’s name on the directory in the lobby of the Building and on the
individual floor directory, if available.  Landlord reserves the right to
restrict the amount of directory space utilized by Tenant.  Tenant shall not
have the right to have additional names placed on the directory without
Landlord’s prior written consent.  If such consent is given, the addition of
such names shall be at Tenant’s expense.

3.           The Premises shall not be used for the storage of merchandise held
for sale to the general public, for lodging or sleeping.  No cooking shall be
done or permitted by any Tenant on the Premises, except the use by the Tenant of
Underwriter’s Laboratory approved microwave oven or equipment for brewing
coffee, tea, hot chocolate and other similar beverages which shall be permitted,
provided that the power required by such equipment shall not exceed that amount
which can be provided by a 30-amp circuit and that such use is in accordance
with all applicable federal, state and city laws, codes, ordinances, rules and
regulations.  Repair and maintenance of garbage disposals, dishwashers,
icemakers and other similar equipment shall be at Tenant’s expense.  If the
Premises or any part of the Building become infested with vermin as a result of
Tenant’s use, Tenant shall reimburse Landlord for the expense of extermination.

4.           No Tenant shall employ any person or persons other than the janitor
of Landlord for the purpose of cleaning the Premises, unless otherwise agreed to
by Landlord in writing.  Except with the written consent of Landlord, no person
or persons other than those approved by Landlord shall be permitted to enter the
Building for the purpose of cleaning the same.

5.           No Tenant shall use or keep in the Premises or the Building any
kerosene, gasoline or flammable or combustible fluid or material other than
limited quantities thereof reasonably necessary for the operation or maintenance
of office equipment; or without Landlord’s prior written approval, use any
method of heating or air conditioning, including, without limitation, portable
floor heaters and fans, other than that supplied by Landlord.  No Tenant shall
use or keep or permit to be used or kept any hazardous or toxic materials or any
foul or noxious gas or substance in the Premises or permit or suffer the
Premises to be occupied or used in a manner offensive or objectionable to
Landlord or other occupants of the Building by reason of noise, odors,
vibrations, or interfere in any way with other tenants or those having business
therein.

Page 18
 
 

--------------------------------------------------------------------------------

 

6.           Any Tenant and its employees, agents or associates or other persons
entering or leaving the Building after ordinary business hours may be required
to sign the building register.  The security officer in charge reserves the
right, on behalf of the Landlord, to refuse to admit Tenant or any of Tenant’s
employees, agents, or associates or any other person to the Building after
ordinary business hours without prior notification from the Tenant or other
satisfactory identification demonstrating such person’s right to access to the
Building.  Each Tenant shall be responsible for all persons for whom it requests
after-hours access and shall be liable to Landlord for all acts of such
persons.  Landlord shall, in no case, be liable for damages for any error with
regard to the admission to or exclusion from the Building of any person.  In the
case of invasion, mob, riot, public excitement or other circumstances rendering
such action advisable in Landlord’s opinion, Landlord reserves the right to
prevent access to the Building during the continuance of the same by such action
as Landlord may deem appropriate including closing doors.  Landlord also
reserves the right to exclude or expel from the Building any person who, in
Landlord’s judgment, is intoxicated or under the influence of liquor or drugs or
who is in violation of any of the Rules and Regulations of the Building.

7.           No curtains, draperies, blinds, shutters, shades, screens or other
coverings hangings or decorations shall be attached to, hung or placed in, or
used in connection with any window of the Building without the prior written
consent of Landlord.  No files, cabinets, boxes, containers or similar items
shall be placed in, against or adjacent to any window of the Building so as to
be visible from the outside of the Building.  Tenant shall cooperate fully with
Landlord in obtaining maximum effectiveness of the cooling system of the
Building by closing draperies and other window coverings when the sun’s rays
fall upon windows of the Premises.  Tenant shall not obstruct, alter or in any
way impair the efficient operation of Landlord’s heating, ventilating, air
conditioning, electrical, fire safety or lighting systems, nor shall Tenant
tamper with or change the setting of any thermostat or temperature control
valves in the Building other than room thermostats installed for Tenant’s
use.  Landlord reserves the right to install solar film on the windows of the
Building to aid the efficiency of the HVAC system and to reduce energy
costs.  Tenant shall not remove solar film from any window.  Tenant shall also
cooperate with Landlord to comply with any governmental energy-saving rules,
laws or regulations.  No bottles, parcels or other articles may be placed in the
halls or in any other part of the Building, nor shall any article be thrown out
of the doors or windows of the Premises.

8.           Each Tenant shall see that the doors of its Premises are closed and
locked, that all water faucets, water apparatus, equipment, lights and other
utilities are shut off before Tenant or Tenant’s employees leave the Premises,
so as to prevent waste or damage; and for any default or carelessness in this
regard, Tenant shall make good all injuries sustained by other Tenants or
occupants of the Building or by Landlord.  On multiple tenancy floors all
Tenants shall keep the doors to the Building corridors closed at all times
except for ingress and egress.

9.           The lavatory rooms, toilets, urinals, wash bowls and other
apparatus shall not be used for any purpose other than that for which they were
constructed; no foreign substance of any kind whatsoever shall be thrown therein
and the expense of any breakage, stoppage or damage resulting from the violation
of this rule shall be home by the Tenant who, or whose employees or invitees,
shall have caused it.

10.         No Tenant shall install any radio or television antenna, loud
speaker or other device on the roof or the exterior walls of the Building
without the prior written consent of Landlord.  No awnings, air conditioning
units or other projections shall be attached to the outside walls or windowsills
of the Building or otherwise project from the Building, without prior written
consent of Landlord.

Page 19
 
 

--------------------------------------------------------------------------------

 

11.         Each Tenant shall store all its trash and garbage within its
Premises.  No material shall be placed in the trash boxes or receptacles if such
material is of such nature that it may not be disposed of in the ordinary and
customary manner of removing and disposing of trash and garbage in the city
where the Building is located without being in violation of any law or ordinance
governing such disposal.  All garbage and refuse disposal shall be made only
through entry ways and elevators provided for such purposes and at such times as
Landlord shall designate.

12.         Each Tenant shall participate in any recycling program for the
Building.

13.         Canvassing, peddling, soliciting and distribution of handbills or
any other written materials in the Building are prohibited and each Tenant shall
cooperate to prevent the same.

14.         Tenant and its authorized representative and invitees shall not make
or permit any noise in the Building that is annoying, unpleasant or distasteful,
interfering in any way with other tenants or those having business with them.

15.         Tenant shall not mark, drive nails, screw or drill into the
partitions, woodwork or plaster or in any way deface the Premises or any part
thereof, except to install normal wall hangings.  Tenant shall repair any damage
resulting from non-compliance with this rule.

16.         Landlord shall direct licensed electricians as to where and how
telephone and electrical wires are to be introduced.  No cutting or boring for
wires shall be allowed without Landlord’s consent.  The location of telephones,
call boxes and office equipment affixed to the Premises shall be subject to
Landlord’s approval.  Neither Tenant, its subtenants, assignees, agents,
employees nor contractors shall have access to or make any changes, alterations,
additions, improvements, repairs or replacements (collectively, “work”) to the
telephone closets, telephone lines or any other communications facilities or
equipment (collectively, the “telephone lines”) within the Building without the
prior written authorization of Landlord, which authorization may be withheld in
Landlord’s sole discretion.  All contractors designated by Tenant to perform
work on the telephone lines shall be licensed and shall be subject to Landlord’s
prior written approval, which approval may be withheld by Landlord in its sole
discretion.  Contractors performing work shall be required to provide evidence
of insurance coverage satisfactory to Landlord, including, without limitation
naming Landlord as an additional insured on all liability policies.  Any costs,
expenses and liabilities incurred by Landlord as a result of Tenant or Tenant’s
contractor performing work on the telephone lines shall be included in Tenant’s
indemnification obligations under the Lease.

17.         Tenant shall not lay linoleum tile, carpet or any other floor
covering to the floor of the Premises, except as approved by Landlord.

18.         Tenant shall comply with all safety, fire protection and evacuation
procedures and regulations established by Landlord or any governmental agency.

19.         Tenant assumes any and all responsibility for protecting its
Premises from theft, robbery and pilferage, which includes keeping doors and
other means of entry to the Premises closed and locked when the Premises are
unattended.

20.         Neither Tenant nor its employees shall park their vehicles in any
parking area designated by Landlord as areas for parking by visitors to the
Building.  Neither Tenant nor its employees shall leave vehicles in the Building
parking areas overnight nor park any vehicles other than automobiles,
motorcycles, motor driven or non-motor driven bicycles or four-wheeled trucks in
the Building parking areas.  Landlord may, in its sole discretion, designate
separate areas for bicycles and motorcycles.  Landlord may establish additional
Rules and Regulations that apply to the parking areas.

Page 20
 
 

--------------------------------------------------------------------------------

 

21.         There shall be no smoking in the Building.  Smoking shall mean
carrying or holding of a lighted pipe, cigar or cigarette of any kind, or any
other lighted smoking equipment or the lighting thereof or emitting or exhaling
the smoke of a pipe, cigar or cigarette of any kind.  Each Tenant shall
cooperate to enforce this prohibition, including giving notice of such to its
employees.

22.         Landlord may waive any one or more of these Rules and Regulations
for the benefit of any particular tenant or tenants, but no such waiver by
Landlord shall be construed as a waiver of such Rules and Regulations in favor
of any other tenant or tenants, nor prevent Landlord from thereafter enforcing
any such rules and regulations against any or all of the tenants of the
Building.

23.         These Rules and Regulations are in addition to, and shall not be
construed to in any way modify or amend, in whole or in part, the terms,
covenants, agreements and conditions of any lease of Premises in the Building.

24.         Landlord reserves the right to make such other reasonable Rules and
Regulations as, in its judgment, may from time to time be needed for the safety,
care and cleanliness of the Building, and for the preservation if the order
therein.

25.         Landlord shall not be responsible to Tenant or to any other person
for the non-observance or violation of these Rules and Regulations by any other
tenant or other person.  Tenant shall be deemed to have read these rules and to
have agreed to abide by them as a condition to its occupancy of the space
leased.

Page 21