Space License Agreement CREATIVE SPACE LICENSE SHARE AGREEMENT
Coworking is still relatively new and, with that, comes some legal ambiguity around the relationship you hold with your member in relationship to the lease you hold with your landlord.
Space License Agreement CREATIVE SPACE LICENSE SHARE AGREEMENT
We went with a Space License agreement as opposed to a sublease agreement, as most lease agreements don’t allow you to charge more for the space than you are paying to your landlord. We explain more about that decision in detail on our blog at blog.desktimeapp.com.
Carefully read the following terms and conditions regarding your membership in the Creative Coworking. By clicking the I Accept button you acknowledge your acceptance of the terms and conditions of this License Share Agreement (“Agreement”), effective as of the date of your acceptance of these terms and conditions. If you do not agree to the terms and conditions of this Agreement, then click the Cancel button to terminate your application.
Ask your lawyer about the particulars of your locale and space. But for all the reasons listed above, we found using a Space License agreement to be a smart option.
Your access to and membership in the Creative Coworking is on the terms and conditions set forth below, and upon the terms set forth on the Desktime website (“Invitation”). The terms of the Invitation are deemed incorporated herein and you are hereby bound by them.
People often ask the legality of using “I Agree” on agreements. If done properly, “I Agree” is legally binding. A valid contract requires offer, acceptance and the exchange of consideration. In this instance, the Coworking Space is making an OFFER to provide services/space available on certain terms and conditions. As long as the terms are clearly communicated, and the user cannot secure the services without clicking “I Agree,” then clicking on “I Agree” constitutes ACCEPTANCE of the offer. CONSIDERATION is what each parties get out of the transaction (and it must be bilateral). In this instance, the Coworking Space receives monetary consideration, and the User receives access to the space/services.
By clicking the I Accept button, you acknowledge that your use of the Desk, as hereinafter defined, is not a lease. As such, you expressly acknowledge that you have not acquired any real property interest in the Premises and/or the Building as those terms are hereinafter described. This License Share Agreement is made as of the date of acceptance by and between Creative Coworking (“Licensor”) having offices known as the second floor, and a portion of the fifth floor, 123 Happy Road, Chicago, IL 12345 (the “Premises”) and you who Accepts the Invitation (“Licensee”). Upon acceptance, Licensee becomes a member of the Creative Coworking. In consideration of the foregoing, the parties agree as follows: 1. Space to be Provided a. Licensor hereby agrees to provide Licensee with the privilege to use one (1) desk and chair within the Premises (“Desk”) and to shared use of the reception area, kitchen pantry and common areas of the Premises for a term commencing on the date selected on the Desktime website Invitation (“the Commencement Date") and ending when Licensee terminates your use of the Desk or upon such other termination event as set forth herein (“the Termination Date”) and subject to the conditions and covenants set forth herein.
We opted to limit the access that a member can have in this document to a desk and other common areas in this agreement. We’ll get to other amenities in a minute.
b. Licensor makes no warranty or representation as to the fitness of purpose or suitability of the Premises for the Licensee's use, or as to the safety thereof, or as to the other occupants of the Premise or Building, it being irrefutably presumed that Licensee has satisfied itself thereof, and that the Licensee shall use the Premises at its sole risk. Licensee has inspected the Premises and the building and accepts the same “as is” and “where is” and agrees that Licensor is under no obligation to perform any work or provide any materials to prepare the Premises or the building for Licensee. Licensee further acknowledges that Licensor shall not maintain any insurance for the benefit of Licensee.
This agreement makes no promises to the safety or condition of the building and makes sure that the member of the space agrees to the space “As Is.”
c. Additional Services Subject to Licensee complying with the terms and conditions set forth herein, Licensor hereby agrees to provide Licensee with the following amenities in connection with the privilege to use the Premises:
This includes amenities that are generally provided to members. This isn’t limited to the HVAC or the Internet, but can include access to shared transportation, equipment, etc. Make sure to separately identify what services or amenities are only available at an additional cost.
• HVAC during normal business hours • Internet access to Desktime wireless network • Utilities (not including phone) • Receipt of mail and packages • Wireless printer and paper • Conference room (subject to scheduling) d. Monthly members are entitled to twenty-four (24) hour access, seven (7) days a week. 2. Use a. The Desk shall be used by Licensee solely for general executive office use in connection with the operation of their business and such other normal incident uses and for no other purpose. Licensee also shall not make nor permit to be made any use of the Premises which would violate any of the terms of this Agreement or which, directly or indirectly, is forbidden by the lease agreement (“Lease”) between Licensor and LANDLORD CORP, LLC (the “Landlord”) or any applicable statute, ordinance or government regulations, or which may be dangerous to life, limb or property or which shall in any way impair or tend to impair the quality character, reputation or appearance of the Premises.
This section binds the member of the space to the landlord’s lease agreement. You should make a copy of the lease (with financial terms redacted) available for review by members.
b. Licensee acknowledges that the Desk is located in a shared workspace and that any items of Licensee’s personal property are brought into and maintained in the Premises at Licensee’s sole risk. Licensor is not responsible for lost, stolen, damaged or moved personal property of Licensee.
Accidents happen and so does theft. While this section of the agreement helps absolve your responsibility to items that are damaged or stolen, most of your members will ignore it. Make sure to go over this in person with your members and make sure that they know that, while you do your best to secure your space, they are responsible for securing their own equipment. You should also discuss appropriate coverage with your insurance provider.
c. Licensee further acknowledges and agrees that the space is occasionally used for hosting events. Licensee agrees that Licensee shall remove all of their personal items at the end of each day that Licensor is hosting an event and store such items in a storage area provided by Licensor.
We regularly hosted events at our space and while it was rarely an issue, sometimes it was distracting to our members. While it’s a manager’s responsibility to make this possibility clear and communicate with their members, this section protects your right to use the space for these events. You may also want to specify how much advance notice members will receive when there is an event scheduled in the space.
d. Licensee is not guaranteed the same desk or desk location from day to day and shall be moved at Licensor’s discretion.
Members get connected to their spot in your space. In the process of managing a space, furniture will change, folks will need to be rearranged and so spaces need the right to move things and people when necessary.
3. Services and License Fee a. The monthly Services and License Fee is set forth in the Invitation. b. In the event Licensee chooses to purchase a monthly membership as set forth in the Invitation, you, as Licensee, shall pay the License Fee, in advance prior to each license month. If any payment of Services and License Fee or other charges due under this License is not received within ten (10) calendar days after its due date, the Licensee will also pay, in addition to the Services and License Fee, a late payment charge which shall be an amount equal to five (5%) percent of any amount owed to Licensor. Notwithstanding the foregoing and in addition to, Licensor may immediately suspend providing any and all Additional Service set forth in paragraph 1(c) upon Licensee’s failure to tender its Monthly Services and License Fee. All Fees shall be payable by credit card only.
These terms are specific to Desktime Space Management software and the language that we use on the site. This articulates that we charge for monthly membership in advance of the month. This also specifies a late fee if members are late in paying their Fees. This also specifies that all payments are due via credit card. From a practical standpoint, it is difficult to suspend the use of “Additional Services” to just one Member.
c. In the event Licensee chooses to purchase a prepaid punch card, Licensee is entitled to a Desk on a first come first served basis and as assigned by Licensor.
Our space sold many prepaid bookings (we call them punch cards.) We specify that these members are offered desks on a first come, first served basis and that a space is not guaranteed even if a punch card is paid for.
d. Licensee may also choose to license the use of a Desk for the day, on terms set forth on the Invitation. e. Credit/Debit Card Authorization. Licensee will provide Licensor with a credit card or debit card number from a card issuer acceptable to Licensor in order to activate your use of the Service. Licensee hereby authorize Licensor to charge and/or place a hold on your credit card or debit card with respect to any charges for the Services and License Fee based upon the Licensor fee schedule then in effect. Licensee authorizes the issuer of the credit card to pay any amounts described herein without requiring a signed receipt, and Licensee agrees that the Agreement and Invitation are to be accepted as authorization to the issuer of the credit card or debit card to pay any amounts described herein without requiring a signed receipt, and Licensee agree that this Agreement and the Invitation are to be accepted as authorization to the issuer of the credit card to pay all such amounts.
This section gives our space permission to charge a member’s credit card for any services without a signed receipt. This helps us quickly cover incidentals and book members into their space without having to get a signed receipt.
Licensee authorizes Licensor to continue to attempt to charge and/or place holds with respect to all sums described herein, or any portion thereof, to Licensee’s credit card until such amounts are paid in full. Licensee agrees to provide Licensor with updated credit card or debit card information upon request and any time the information Licensee previously provided is no longer valid. Licensee acknowledges and agrees Licensor will not have any liability whatsoever for any non-sufficient funds or other charges incurred by Licensee as a result of such attempts to charge, and/or place holds on, Licensee’s credit card or debit card.
This section makes sure that your members will cover any fees or charges that are incurred as a result of failed payment.
In the event Licensee is enrolled, or later enrolls, in an automatic payment or electronic funds transfer plan, Licensee agrees that all sums described herein may be charged, at Licensor’s option, to the account number provided for such automatic payment or electronic funds transfer plan. When payment is made by credit card or debit card, payment will also be subject to the terms and conditions established by the creditor debit card issuer. The Licensee shall promptly receive information confirming the License Fee and/or order of Services and the charge processed therefor. If there is any dispute as to an order or charge, Licensee shall promptly bring such to the attention of Licensor, but in no event later than maximum number of days permitted by the credit or debit card processing agreement (and if none is stated then sixty (60) days after the earlier of written confirmation from Licensor or posting on Licensee’s credit card statement), and otherwise in compliance with applicable law and credit and debit card agreements if such provide more favorable rights to the Licensee.
If a member has a dispute regarding a charge, they have no more than the maximum number of days that their card processor allows to dispute the charge. You want to find out about disputes as soon as possible, when the facts and circumstances surrounding such are fresh.
f. If a Licensee’s Services and License Fee cannot be processed through Licensee’s credit card or debit card or your bank draft or electronic transfer is returned for any reason, Licensee will pay an additional charge of $100.00 per incident and, for the purpose of considering default and/or late charges it will be as if the payment had never been made.
We created a fee (that we rarely enforced) that added $100 per incident that a member’s payment is not able to be made.
4. Refundable Retainer a. Licensee shall deposit with Licensor the sum of $50.00 as a refundable retainer to be held as security for the faithful performance by Lessee of all of its obligations under this License, including timely return of the elevator key and key fob. Nothing contained in this paragraph shall be construed to permit the Licensor to use the refundable retainer to replace any furniture, fixtures and/or equipment which are rendered unusable by reason of obsolescence, age, or other defect not related to the Licensees’ misuse and or/damage to same.
Our space had an elevator key that was costly (and annoying) to order from our landlord. We created a deposit as a retainer for this elevator key which ensured that we got most keys returned to us.
b. The refundable retainer (less any sums used by Licensor in accordance with the terms and conditions of this License) will be returned within thirty (30) days after the expiration of the term hereof, subject to Section 4(c). The refundable retainer shall not under any circumstance be applied in lieu of be the final payment(s) of Monthly Services and License Fee or service charges under this License.
We pay back that deposit within one month and it is never used in lieu of a final payment. You may not realize that need to apply it for a lost keycard, etc. until after they stop using the space. If you have already applied their deposit to the last session, you will have little or no practical recourse against that member if you are unable to process a charge under the following paragraph.
c. In the event that, by reason of the Licensee’s default in its obligations pursuant to this License or otherwise, Licensor shall be entitled to apply any of the refundable retainer deposited pursuant to this License to any outstanding sums due or owing to the Licensor. Licensor shall have the right to charge the Licensee, in addition to any Services and License Fee, such sums as are necessary to replenish any and all amounts applied so as to cause the refundable retainer to be returned to its entire original amount. The failure to pay such amounts as are necessary to replenish the refundable retainer shall be considered a breach of this License and shall entitle the Licensor to exercise any of its rights pursuant to this License, applicable law or otherwise. 5. Licensee’s Additional Expenses a. Telecommunications. Licensee shall be responsible for providing its own cellular telecommunications service, Licensor shall provide access to its wi-fi internet access/connections. All charges for the installation and fees associated with providing Licensee’s telecommunications services shall be at Licensee’s sole cost and expense. Licensor shall not be liable for any interruption or error in the performance of Licensee’s telecommunications or internet services to Licensee under this Section, including but not limited to any claim for business interruption and/or for consequential damages. b. Lost Elevator Key. A charge of Fifty Dollars ($50.00) will be assessed to a lost elevator key or key fob.
This was specific to our space, but might be handy to recoup key or equipment costs.
6. Waiver of Claims Licensee shall indemnify and hold Licensor harmless from and against any loss, damage or liability of any sort whatsoever resulting from (i) any default in observing the terms and conditions of this License and/or (ii) any willful or negligent act on the part of the Licensee, its agents, employees, or invitees, or persons permitted on the Premises by Licensee. Licensee expressly agrees to waive, and agrees not to make any claim against Licensor for damages, direct, consequential or otherwise, arising out of (i) any failure to furnish any service of Premises, any error or omission with respect thereto, any delay or interruption of same, (ii) injury to or death of persons in or about the Premises, (iii) loss or damage to Licensee’s property in or about the Premises, and (iv) claims arising by reason of the foregoing.
This provision puts responsibility on the Licensee for any damages they cause to the space, as well as any costs or expenses you incur as a result of their failure to comply with the terms of this Agreement. This section further limits your liability to the Licensee; it clarifies that they are basically using the space at their own risk and absolves you from liability for anything bad that happens to them while using the space. From a legal standpoint, you cannot escape liability for your own gross negligence or willful misconduct, but this does protect you from liability for accidents or damages caused by other users of the space.
7. Operating Standards The Operating Standards posted at the Premises are made an integral part of this License. Licensee, its employees, agents, guests, invitees, visitors and/or any other persons caused to be present in and around the Premises by the Licensee shall perform and abide by the rules and regulations set forth in the Operating Standards and any amendments or additions to said rules and regulations as Licensor or Landlord may make. In Licensor's sole discretion, should it determine that Licensee has failed to observe and/or comply with any of the Operating Standards, Licensee shall be in breach of this License and Licensor shall be entitled to exercise any of Licensor's remedies pursuant to this License or otherwise. 8. Assignment and Sublicensing
A member cannot sublicense or rent out a part of their space without consent of space. You need to retain control of who is using the space, as you are ultimately responsible to your Landlord for the space. You also do not want your members competing with you.
No assignment or sublicensing of the Premises, this License or any part thereof, shall be made by Licensee without Licensor's prior written consent, which consent shall not be unreasonably withheld, and the consent of the Landlord. 9. Surrender, Restoration and Holdover
Here we specify that a member must return specific property of the space upon leaving including keys, equipment, etc.
a. On expiration of the term, or sooner termination of this License, Licensee shall, without demand, promptly surrender and deliver the Desk, elevator key and key fob, to Licensor. b. If Licensee is in default of the terms of this License and/or vacates the Desk and leaves behind any property whatsoever, said property will be deemed abandoned by Licensee and may be disposed of by Licensor at Licensee's expense. 10. Default and Remedies
This section specifies what is considered “default” of your licensing agreement as well as what happens in that case.
a. Licensee shall be deemed to be in default of this License if Licensee shall fail to fulfill any of its terms, conditions, covenants or provisions of this License, including but not limited to: This section explains what constitutes a default to the licensing agreement. i. Payment of Monthly Services and License Fee and/or any other charges hereunder is not made within ten (10) days of the date such charges become due; ii. Failure to fulfill or abide by any of the terms, conditions, covenants or provisions of this License; iii. Abandons and/or vacates the Premises; iv. Licensee’s breach and/or non-observance, in Licensor or Landlord’s sole discretion, of any of the Operating Standards. b. In case of such default is not cured within five (5) days of notice to Licensee, the Licensor may, at its sole discretion, terminate this License. Upon termination for default, Licensee shall quit and surrender the Desk, elevator key and key fob to the Licensor. Should Licensee fail to quit and surrender the Desk, the Licensor may:
This section explains what action the space can take upon default.
i. Take possession (including but not limited to the right to change the locks) of the Desk and remove all persons and property therefrom; and/or ii. Immediately cease supplying Licensee with the amenities and Monthly Services described in Paragraph “1c” hereof as well as any other services provided by the Licensor, all without any liability whatsoever to Licensee by Licensor; and/or iii. Pursue all available remedies and damages available at law and/or equity in a court of appropriate jurisdiction. 11. Notices Any notice under this License shall be in writing and shall be either delivered by hand or by overnight mail to the party at the address set forth below. Licensor hereby designates its address as: Creative Coworking 123 Happy Road Chicago, IL 60600 Attn: Manager James
Don’t forget to update all this information and other highlighted sections!
Licensee hereby designates its address as set forth in the Invitation. If such mail is properly addressed and mailed as above, it shall be deemed notice for all purposes, given when sent or delivered, even if returned as undelivered. 12. Landlord's Election Under This License Upon early termination of the Licensor’s Lease, this License shall terminate unless the Landlord under the Lease elects to have this License assigned to the Landlord or another entity as provided in the Lease.
This point protects you in the event that your master lease with your landlord is terminated.
13. Execution by Licensee The party or parties executing this License on behalf of the Licensee warrant(s) and represent(s) that such executing party (or parties) has (or have) complete and full authority to execute this License on behalf of Licensee; and that Licensee shall fully perform its obligations hereunder. 14. Miscellaneous
There are a lot of legal crossing t’s and dotting i’s that follow.
a. Failure of the Licensor not to insist upon the strict performance of any term or condition of this License or to exercise any right or remedy available for a breach thereof, and no acceptance of full or partial payment during the continuance of any such breach shall constitute a waiver of any such breach or any such term or condition. b. No term or condition of this License required to be performed by Licensee and no breach thereof shall be waived, altered or modified, except by a written instrument executed by Licensor. c. Each term, provision and obligation of this License shall be construed as both a covenant and condition. d. This License embodies the entire understandings between the parties relative to its subject matter, and shall not be modified, changed or altered in any respect except in writing signed by all parties. e. This License is subject and subordinate to the Lease governing the Premises, under which Licensor (or its affiliate) is bound as tenant; and the provisions of the Lease, other than as to the payment of Rent, Monthly Services and License Fee or other monies, are incorporated into this License as if completely herein rewritten. Licensee shall comply with and be bound by all provisions of the Lease (except that the payment of Monthly Services and License Fee shall be governed by the provisions of this License), and Licensee shall indemnify and hold Licensor harmless from and against any claim or liability under the Lease of Licensor arising from Licensee’s breach of the Lease or this License. Licensor covenants and warrants that the use of the Premises as a business office is consistent with and does not violate the terms of the Lease.
This protects your commitment to your landlord and binds your member to the same rules that you have agreed to under your master lease. If your member breaks rules created in your lease, they’re independently responsible for their actions. Savvy members might ask to look at your lease before signing this agreement so, as we mentioned earlier, have a copy with financial information redacted easily accessible.
f. Licensor covenants and agrees with Licensee that upon Licensee paying all the Monthly Services Fees hereunder and all other charges due under this License and observing and performing all the terms, covenants and conditions of this License, Licensee may peaceably enjoy the Premises, subject to the terms of this License and the share arrangement contemplated hereby and the terms of the Lease. g. This License shall be governed by the laws of the State of Illinois. The parties agree that any legal proceeding concerning the enforcement or interpretation of this License shall be exclusively venued in Cook County.
No one ever wants things to get to a point of litigation. But it’s super important that you establish the correct jurisdiction to efficiently protect yourself, your time, your investment and your energy