Exhibit
10.17


 


LEASE AGREEMENT


 


THIS LEASE (this “Lease”) is made as of 3/28, 2005 by and between Genesis
Partners, LLC of Bozeman, Montana, herein referred to as “Landlord”, and Right
Now Technologies, Inc., a Montana corporation, of Bozeman, Montana, hereinafter
referred to as “Tenant”.


 


WITNESSETH:


 


1. Leased Property. Landlord hereby leases
to Tenant the office building located on the real property in Gallatin County,
Montana whose address is 77 Discovery Drive, Bozeman, Montana, consisting of
approximately 9184 square feet as depicted on the attached Exhibit A,
together with (i) the non-exclusive right of ingress and egress for Tenant
and its employees, agents, invitees and contractors between the building and
the nearest public streets, and (ii) the exclusive right to use the parking
lot surrounding the building for its employees, agents, invitees and
contractors (the “premises”). Landlord represents and agrees that the parking
lot will provide, at all times during the term of this Lease, a parking ratio
of not less than five spaces per 1000 square feet of rentable square footage in
buildings whose tenants are or will be using the parking lot.


 


2. Terms of Lease.
The primary term of this Lease shall be for sixty (60) months commencing on the
1st day of April, 2005, and ending on the 31st day of March, 2010,
both dates inclusive, unless sooner terminated as herein provided.


 


3. Option to Extend. Upon expiration
of the primary term of this Lease, Tenant is granted an option to extend the
term of this Lease for two (2) additional sixty (60) month periods, each
(each an “extension term”) upon the same terms and conditions as are included
in this Lease, subject, however, to renegotiation of the rent provided in
paragraph 4 of this Lease. The primary term and the extension terms will be
collectively referred to in this Lease as the “term.” Tenant shall notify Landlord
within not less than one hundred twenty (120) days prior to the expiration of
the primary term of this Lease or prior to the expiration of each extension
term of Tenant’s exercise of its option to extend this Lease, provided that in
the circumstances described in paragraph 13, the options to extend the term may
be exercised earlier as provided in paragraph 13, and if the option to extend
is exercised earlier as provided in paragraph 13, nevertheless, the rental
payable as provided in


 





















 


paragraph 4 shall be determined at the time and in
the manner provided in paragraph 4 and this paragraph 3. During the following
sixty (60) day period, Tenant and Landlord shall negotiate and arrive at an
agreement or disagreement of the amount of rent to be paid during the
applicable extension term. If Landlord and Tenant agree upon the rent to be
paid during the applicable extension term, Landlord and Tenant shall at the end
of the sixty (60) day period enter into a new written lease or an amendment
agreement setting forth the amount of rental Tenant shall be required to pay
pursuant paragraph 4 for the applicable extension term and any other additional
terms to which Landlord and Tenant have agreed. If Tenant and Landlord fail to
agree upon the rent to be paid during the applicable extension term during the
sixty (60) day period of negotiations, a fair market appraisal comparison of
comparable properties will be completed by an independent party upon which the
Landlord and Tenant may use to negotiate the amount of rent to be paid during
the applicable extension term. If Tenant and Landlord fail to agree upon the
rent to be paid during the applicable extension term during the sixty (60) day
period of negotiations, either Landlord or Tenant may, by written notice to the
other party given within the ensuing thirty (30) day period, elect to invoke
the arbitration provisions of this Lease to determine the rent Tenant shall be
required to pay pursuant to paragraph 4 for the applicable extension term.


 


4. Rent. Tenant shall pay as rental
for the premises for the first year of the primary term of the Lease the sum of
$133,260 computed at the rate of $14.51 per square foot on 9184 square feet of office
space, payable monthly, in advance on the first day of each month, in
installments of $11,105 per month. On each anniversary date of this Lease,
beginning on April 1st, 2007, the annual rent shall be
increased by 2%. Rent shall be paid without notice or demand by Landlord to
Landlord at 895 Technology Blvd, Suite 101, Bozeman, Montana 59718 or at
such other place as Landlord may direct in writing.


 


5. Covenants. Tenant hereby acknowledges
and agrees:


 


A. Tenant is familiar with the premises.
Tenant’s taking of possession of the premises shall be conclusive evidence that
the premises were in good, clean and sanitary condition, are in all respects
satisfactory and acceptable to Tenant, and are in the condition in which
Landlord represented the premises to be.


 


B. Tenant will keep the premises in a clean
and sanitary condition during the term of this Lease. Landlord shall have no
obligation to make any alterations or improvements of any kind in or


 





















 


about
the premises other than as set forth in this Lease. Tenant shall repair or
replace promptly all damages to the premises due to acts of Tenant, its agents,
employees, invitees, or subtenants, reasonable wear and tear excepted. Tenant
also shall not cause any waste to be committed in or about the premises; Tenant
will keep the premises free and clear of any and all refuse and debris; and
Tenant agrees to observe all rules and regulations of the County of
Gallatin and State of Montana in any way relating to maintenance, use and
occupancy of the premises.


 


C. Tenant will not use or permit anything to be
used upon the premises which is likely to deface or damage the premises, or do
anything that will increase the rate of insurance thereof (unless Tenant first
agrees to pay any increased premiums), or permit anything to be done upon the premises
or in the areas, sidewalk or streets adjacent to the premises, which will
amount to or create a nuisance.


 


D. Tenant shall make no alterations in or
additions to the premises without first obtaining Landlord’s written consent,
which consent will not be unreasonably withheld, delayed or conditioned. Tenant
shall not erect or permit to be erected upon the premises any signs without written
consent of Landlord, which consent will not be unreasonable withheld, delayed
or conditioned.


 


E. Tenant agrees, with respect to all
alterations or improvements to the premises or any part thereof, which Tenant
undertakes with written consent of Landlord, that Tenant shall in all instances
save Landlord and the premises forever harmless and free from all damages, loss
and liability of every kind and character which may be claimed, asserted or
charged, including liability to adjacent owners or tenants, based upon the acts
or negligence of Tenant or its agents, contractors or employees, for any
negligence, or for the failure of any of them to observe and comply with the
requirements of the law, including the regulations and the authorities in the
City of Bozeman, and Tenant will preserve and hold Landlord and the premises free
and clear from all liens or encumbrances for labor and materials furnished. Any
and all alterations, additions, and improvements made by Tenant to or upon the
premises (with the exception of furnishings, equipment, and removable trade
fixtures installed by Tenant) shall, upon installation, be deemed attached and
part of the premises, provided however, that if prior to termination of this
Lease, or within fifteen (15) days thereafter, Landlord so directs by written
notice to Tenant, promptly following said termination of this Lease, Tenant
shall remove such of the said additions,


 





















 


improvements,
fixtures, and installations placed upon the demised premises by Tenant as shall
by designated in said notice from Landlord, and Tenant shall repair any damages
occasioned by such removal. Further, in this regard, Tenant hereby agrees that
it will, during the continuance of this Lease, keep the premises and interior
of the premises in good condition and repair, reasonable wear and tear
excepted.


 


F. Tenant may use and occupy the premises
for the purpose of a business office and all activities incidental thereto,
including the manufacture of software, and not otherwise. Tenant shall not use
or knowingly permit any part of the premises to by used for any unlawful purposes
and shall comply with all applicable laws and regulations of the County of
Gallatin, State of Montana, and the United States of America.


 


G. Tenant agrees that Landlord shall not be
liable for any damage or injury to persons or property or for the loss of
property sustained by Tenant or by any other person or persons on the premises
due to any act of negligence of Tenant.


 


H. Tenant agrees that it will not assign
this Lease or sublease any portion of the premises or permit this Lease to
transferred by operation of law or otherwise without the written consent of
Landlord, which consent shall not be unreasonably withheld, delayed or
conditioned; provided, however, that any merger and reorganization of Tenant
for the purpose of incorporating under another state law shall not be deemed to
be an assignment for purposes of this paragraph and shall not require Landlord’s
consent, or that any merger or change in control of the Tenant shall not be
deemed to be an assignment for the purposes of this paragraph and shall not
require Landlord’s consent. Tenant shall remain responsible under this Lease
for any portion of the premises sublet by Tenant (even if Landlord approved the
subletting), unless Landlord shall agree otherwise. Any subtenant to whom any
portion of the property is sublet shall agree to abide by the provisions of
this Lease which are applicable to the sublet portion of the premises, before
Landlord will be required to consent to the proposed subleasing of any portion
of the premises.


 


I. Tenant will permit Landlord, at all
reasonable times and after reasonable notice to Tenant at Landlord’s sole risk
and expense and in a manner that causes the least practical disruption to
Tenant, to enter upon the premises (i) to inspect their condition and to
make reasonable and necessary repairs for the protection and preservation of
the premises, (ii) to ascertain whether Tenant has performed its covenants
under this Lease, and (iii) to show the premises to persons who


 





















 


may
wish to rent the premises after the expiration of the term of this Lease or to
purchase the premises, provided that any showing of the premises to persons who
may wish to rent the premises shall be only during the last year of the term of
the Lease.


 


J. Tenant, upon leaving the premises, shall
at its own expense, remove all dirt, rubbish, and refuse and upon failure to do
so, Landlord may immediately, without further notice, do so at Tenant’s
expense. Tenant shall immediately pay Landlord’s expenses upon receipt of a
bill for the same from Landlord.


 


6. Default and Landlord’s Rights. If
the premises shall be deserted or vacated, or if a trustee or receiver of a
substantial portion of Tenant’s property is appointed, or if an order is
enetered against Tenant for relief under Title 11 of the United States Code, or
there shall be a default in payment of any rent for more than five (5) days
after written notice of such default from Landlord, or there shall be a default
in the performance or any other covenant, agreement, condition, rule or
regulation herein contained, or hereafter established with Tenant’s consent,
which shall continue for more than thirty (30) days (or, if the default is not
curable within thirty (30) days and if Tenant begins to cure the default within
such thirty (30) day period and diligently pursues curing the same, then for
such for additional period as shall be reasonably necessary to cure the
default) after Tenant’s receipt of written notice of such default from
Landlord, Tenant’s rights in this Lease (if Landlord so elects, and such
election is reserved) shall thereupon terminate and end without the necessity
for any further notice, and Landlord shall have the right to re-enter and
repossess the premises in the manner permitted by law and dispossess or remove
there from Tenant or other occupants thereof and their effects without being
liable to any prosecution or action therefore. Landlord may likewise, at
Landlord’s option, and in addition to any other remedies which Landlord may
have upon default, let and relet the premises in whole or in part, altering,
changing or subdividing the same as in its reasonable judgment may accomplish
the best rental results, and upon such terms and for such length of time,
whether lesser or greater than the unexpired portion of the term of this Lease,
as Landlord may reasonably see fit, and Tenant shall be liable to Landlord for
any deficiency between the remaining unpaid rental and the rental so procured
by Landlord for the period of said letting or reletting which is during the
remaining term of this Lease and shall further be liable for the reasonable
costs of reletting and alterations or changes required to enable Landlord to
let and relet the premises, the deficiency and costs not to exceed, however,
the balance of the


 





















 


unpaid rental due from tenant for the remaining
term of the Lease. Landlord any institute action for the whole of any such
deficiency immediately upon effecting a letting or reletting and shall not
thereafter be precluded from further like action in the event such letting or
relettng shall not cover the entire unexpired portion of the term hereof, or
Landlord may monthly, or at such greater intervals as it may see fit, require
Tenant to pay said deficiency then existing, and Tenant agrees to pay said
deficiency to Landlord from time to time when called upon by Landlord to do so.
Should this Lease not be terminated, Landlord may, notwithstanding such letting
or reletting, at any time thereafter elect to terminate it. Tenant, upon
termination as herein provided, will yield quiet and peaceful possession to
Landlord, subject to any letting or reletting Landlord has effected of the
premises. If Landlord shall give the notice of termination as herein provided,
then, at the expiration of such period, this Lease shall terminate as completely
as if that were the date herein fixed for the expiration of the term of this
Lease, and Tenant shall then surrender the premises to Landlord.


 


7. No Waiver of Breach. Tenant agrees that
no consent, expressed or implied, by Landlord to any breach of Tenant’s
covenants or agreements shall be deemed a waiver of any succeeding breach.


 


8. Notice. It is agreed that all notices
herein required to be given shall be effective upon mailing, postage prepaid,
addressed to Landlord at 895 Technology Blvd, Suite 101 Bozeman, Montana
59718 or addressed to Tenant at 45 Discovery Drive, Bozeman, Montana or such
other place as either may designate in writing to the other. In addition, any
notice from Landlord to Tenant relating to this Lease or the premises shall be
deemed duly served if personally delivered to an officer of Tenant at the
premises.


 


9. Surrender Upon Termination. Tenant
shall, upon termination of the term, peacefully and quietly surrender the
premises to Landlord in as good condition as it was at the beginning, reasonable
use and wear and damage by the elements excepted. Tenant shall remove all of
its personal property and trade fixtures (repairing any damage to the premises
such removal causes) so that Landlord can repossess and enjoy the premises not
later than noon on the day upon which the term ends, whether upon notice or by
holdover or otherwise. Landlord shall have the right to enforce this covenant
by ejectment, for damages, or for breach of any other condition or covenant of this
Lease.


 





















 


10. Peaceful Possession. Landlord covenants and
agrees, at its sole expense, that the exterior, structure, the roof and the
heating, ventilating, air conditioning, electrical, plumbing and all utility
systems on or in the premises shall be maintained in good repair and tenantable
condition, excepting damage resulting from neglect or intentional acts of
Tenant, its agents, employees, contractors and invitees. So long as Tenant pays
the rent and performs the covenants and agreements herein contained, Tenant
shall peacefully and quietly hold the premises for the primary term and any
extensions thereof.


 


11. Time of Essence. Time is of the essence
of this Lease with respect to the performance by Tenant and Landlord of their
obligations hereunder.


 


12. Attorney’s Fees. In the event any
action to enforce any of the terms of this Lease is brought, the prevailing
party shall be entitled to its reasonable attorney’s fees as provided in paragraph
25.


 


13. Liability - Premises. Landlord shall
not be responsible or liable (i) for any personal injury to Tenant or any
other person on the premises, or for injury or damage to personal property or improvements
of Tenant or of any third party on the premises unless such injury or damage is
caused by the neglect or omissions of Landlord, its agents or employees; (ii) for
injury or damage caused by the neglect or omissions of Tenant or its agents,
contractors, invitees or employees; or (ii) on account of any inconvenience or
annoyance or damage caused by fire, explosion, earthquake, flood or other
causes beyond the control of Landlord. Tenant will obtain general liability
insurance in an amount of not less than $1,000,000 on which Landlord shall be
named as an additional insured. If Tenant shall sublet any portion of the
premises, the subtenant shall also furnish the general liability insurance
required of Tenant or be covered under Tenant’s policy.


 


In addition, Tenant will
at all times hold Landlord harmless from any claim or damages by reason of any
personal injury, property damage, or otherwise, arising from its operation or
use of the premises or any of Tenant’s equipment used in connection therewith,
provided the claim or damage is not caused by negligence or omission of
Landlord, its agents, contractors or employees.


 


Landlord shall carry, at its sole expense,
all risk casualty insurance, covering the premises, in the amount equal to the
full replacement cost of the premises. The policy shall be endorsed so that it
may be terminated or amended only upon not less than thirty (30) days prior
written notice to Tenant. The policy shall contain no co-insurance clause, a
deductible amount not exceeding $5,000,


 


 





















 


and
the insurance company’s consent to the waivers of subrogation set forth in the
next sentence. Landlord waives any claims it may have against Tenant and any
rights to grant subrogation rights to others for any loss, damage or claim
which is covered by Landlord’s insurance. In the event that the premises shall
be rendered wholly or partially untenantable by fire, explosion, earthquake,
Act of God, or any other cause beyond the control of Landlord (collectively,
the “casualties”), Landlord (i) shall rebuild and restore the premises as
soon as reasonably practicable to the premises’ former condition and use but
only (A) to the extent of the insurance proceeds Landlord receives, and (B) if
the casualties do not occur during the last two (2) years of the term (and
for this purpose the term shall include all extension terms Tenant notifies
Landlord it will exercise on or before thirty (30) days after the occurrence of
any of the casualties), or (ii) in circumstances not described in clause (ii) may,
at its option, either terminate this Lease by written notice given to Tenant
within sixty (60) days after the casualty or commence to repair the premises
within sixty (60) days after the casualty. If Landlord shall elect or be
required to repair the premises, the rental hereunder shall be abated in
proportion to the part of the premises that are untenantable, and no rental
shall be payable hereunder for the period that said premises shall be wholly
untenantable, provided that in the event any of the casualties is caused by
carelessness, negligence or improper conduct of Tenant, or of Tenant’s agents,
employees, contractors or invitees, the rental shall not be so abated.


 


All fixtures or improvements placed on the
premises by Tenant, which shall be damaged or destroyed, shall be repaired and
replaced by Tenant at its own expense and not at the expense of Landlord.


 


If any of the glass or plate glass in the
premised shall be damaged or become broken from the inside, Tenant shall
replace, at Tenant’s own cost and expense, all such glass or plate glass
broken. If the glass is damaged or broken from the outside, Landlord shall
replace the same at its own cost and expense.


 


14. Repairs and Maintenance.
Landlord shall bear the entire expense of all repairs, maintenance,
alterations, or improvements to the basic structure (exterior walls, roof,
heating, ventilating, air conditioning, electrical, plumbing and other systems
on the premises). Landlord shall, in addition, bear the entire expense for the
repair and maintenance of the parking area, including landscaping and keeping
the parking area free of rubbish, ice and snow. Tenant shall pay


 





















 


at its own expense, all repairs, maintenance, and
alterations of Tenant installed fixtures or improvements and utilities.


 


15. Utilities. Taxes Etc. Tenant shall pay
for all telephone, water/sewer, electricity, natural gas, fire system
monitoring, security systems, and janitorial services used in the operation of
the premises. Tenant agrees to pay for replacement of light bulbs. Landlord
shall pay for all real property taxes and assessments levied and assessed
against the premises and for snow removal and lawn maintenance.


 


16. No Smoking Policy. There will be no
smoking allowed anywhere in the premises by anyone. It will be Tenant’s
responsibility to convey to and enforce this policy by its employees, agents
and all other invitees.


 


17. Paragraph Headings. The paragraph headings
in this instrument are for convenience only and do not limit or construe the
contents or any paragraphs.


 


18. Severability. It is the intent of the
parties that if a part of this Lease is invalid, all valid parts that are
severable from the invalid part shall remain in effect. If a part of this Lease
is invalid in one or more of it applications, that part remains in effect in
all valid applications that are severable from the invalid applications.


 


19. Landlord’s Liability. The term “Landlord”
as used herein shall mean only the owner or owners at the time in question of
the premises. In the event of any transfer of such title or interest, Landlord
herein named (and in case of any subsequent transfers the then grantor) shall
be relieved from and after the date of such transfer of all liabilities as
respects Landlord’s obligations thereafter to be performed, provided that any
funds in the hands of Landlord or the then grantor at time of such transfer in
which Tenant has an interest shall be delivered to the grantee, who shall
assume the obligations of Landlord or the then grantor to Tenant with respect
to those funds. The obligations contained in this Lease to be performed by
Landlord shall, subject to the foregoing provisions of this paragraph 19, be binding
on Landlord’s successors and assigns.


 


20. Supersedes. This Lease supersedes all
prior agreements between the parties.


 


21. Exercise of Rights. The omission of
Landlord or Tenant to exercise any right provided for on the default of the
other at any time shall not preclude Landlord or Tenant from the exercise of such
right at any subsequent default of the other or be deemed a waiver thereof or
the right to do so.


 





















 


22. Binding Effect. This Lease shall be
binding upon and inure to the benefit of the heirs, successors, administrators,
and permitted assigns of the parties hereto.


 


23. Security Deposit. The parties
acknowledge that at the execution of this Lease, Landlord holds the sum of
$10,000 as a security deposit in connection with a prior lease of the premises.
Landlord shall continue to hold and use the security deposit as security for
Tenant’s performance of its obligations under this Lease. At the termination of
this Lease and if at that time Tenant has fully complied with all of its
obligations under this Lease, Landlord shall return the security deposit, without
interest (or the part of the security deposit which Landlord has not applied to
satisfy Tenant’s obligations under this Lease), to Tenant


 


24. Governing Law. This Agreement and all
matters relating thereto shall be governed by the laws of Montana..


 


25. Arbitration. Any dispute under this
Lease shall be decided by binding arbitration initiated and conducted in
accordance with the commercial arbitration rules of the American Arbitration
Association (“AAA”). The parties shall decide upon the arbitrator. If the
parties are unable to decide upon the arbitrator within ten (10) days
after a notice from one party to the other that a dispute exists under this
Lease, the AAA shall select the arbitrator. The decision of the arbitrator
shall be binding. All costs of arbitration shall be borne by the party the
arbitrator determines to be the non-prevailing party. Such costs shall include
the costs and reasonable attorneys’ fees of the prevailing party.


 





















 


IN
WITNESS WHEREOF, the parties have hereunto set their hands as of the date and
year first written above.


 


 


	
  GENESIS
  PARTNERS, LLC – Landlord

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ Steve Daines

  	
   

  	
  3/24/05

  	
   

  
	
  Steve Daines, member – Landlord

  	
   

  	
  date

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  /s/
  Clair Daines

  	
   

  	
  3/28/05

  	
   

  
	
  Clair
  Daines, member – Landlord

  	
   

  	
  date

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  /s/ Greg Gianforte

  	
   

  	
  3/28/05

  	
   

  
	
  Greg Gianforte, member – Landlord

  	
   

  	
  date

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Right Now Technologies, Inc. – Tenant

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By

  	
  /s/ Alan Rassaby

  	
   

  	
  3/17/05

  	
   

  
	
   

  	
  Alan Rassaby

  	
   

  	
  date

  	
   

  
	
   

  	
  Company Secretary