Exhibit 10.43
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LEASE AGREEMENT BETWEEN
EsNET PROPERTIES L.C.,
A Utah limited liability Company, as
Landlord
and
CAPTUREQUEST, INC., as
Tenant
DATED May 8. 2001
TABLE OF CONTENTS
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Page
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TABLE OF CONTENTS 2
LEASE AGREEMENT 6
ARTICLE 1: DEFINITIONS 6
ARTICLE 2: PREMISES 6
ARTICLE 3: TERM 6
ARTICLE 4: USE 6
ARTICLE 5: RENT 7
5.2 Additional Rent 7
5.3 Parking Charge 8
5.4 Payment of Rent 8
5.5 Delinquent Payments and Handling Charge 8
5.6 Security Deposit 8
ARTICLE 6: CONSTRUCTION OF IMPROVEMENTS 9
6.1 General 9
6.2 Access by Tenant Prior to Landlord's Work Completion Date 9
6.3 Commencement Date; Adjustment to Commencement Date 9
ARTICLE 7: SERVICE TO BE FURNISHED BY LANDLORD 10
7.1 General 10
7.2 After Hours Heating and Air Conditioning 11
7.3 Keys 11
7.4 Tenant Identity 12
7.5 Charges 12
7.6 Operating Hours 12
ARTICLE 8: REPAIR AND MAINTENANCE 12
8.1 By Landlord 12
8.2 By Tenant 13
ARTICLE 9: TAXES ON TENANT'S PROPERTY 13
ARTICLE 10: TRANSFER BY TENANT 13
10.1 General 13
10.2 Conditions 14
10.3 Liens 14
ARTICLE 11: ALTERATIONS 15
ARTICLE 12: PROHIBITED USES 15
ARTICLE 13: ACCESS BY LANDLORD 16
ARTICLE 14: CONDEMNATION 16
ARTICLE 15: CASUALTY 17
15.1 General 17
15.2 Acts of Tenant 17
ARTICLE 16: SUBORDINATION AND ATTORNMENT 18
16.1 General 18
16.2 Attornment 18
ARTICLE 17: INSURANCE 19
17.1 General 19
17.2 Waiver of Subrogation 20
ARTICLE 18: TENANT'S INDEMNITY 20
ARTICLE 19: THIRD PARTIES; ACTS OF FORCE MAJEURE 21
ARTICLE 20: SECURITY INTEREST 21
ARTICLE 21: CONTROL OF COMMON AREAS 21
ARTICLE 22: RIGHT TO RELOCATE 21
ARTICLE 23: QUIET ENJOYMENT 22
ARTICLE 24: DEFAULT BY TENANT 22
24.1 Events of Default 22
24.2 Remedies of Landlord 22
24.3 Payment by Tenant 24
24.4 Reletting 24
24.5 Landlord's Right to Pay or Perform 24
24.6 No Waiver; No Implied Surrender 24
ARTICLE 25: DEFAULT BY LANDLORD 25
ARTICLE 26: RIGHT OF RE-ENTRY 25
ARTICLE 27: GENERAL PROVISIONS 26
27.1 Independent Obligations; No Offset 26
27.2 Time of Essence 26
27.3 Applicable Law 26
27.4 Assignment by Landlord 26
27.5 Estoppel Certificates; Financial Statements 26
27.6 Signs, Building Name and Building Address 27
27.7 Notices 27
27.8 Entire Agreement, Amendment and Binding Effect 27
27.9 Severability 27
27.10 Number and Gender, Captions and References 28
27.11 Attorney's Fees 28
27.12 Brokers 28
27.13 Interest on Tenant's Obligations 28
27.14 Authority 29
27.15 Recording 29
27.16 Exhibits 29
27.17 Multiple Counterparts 29
27.18 Miscellaneous 29
(SIGNATURES) 30
EXHIBIT A: GLOSSARY OF DEFINED TERMS 31
1. Addendum 31
2. Affiliate 31
3. Building 31
4. Building Operating Hours 31
5. Building Rules and Regulations 31
6. Building Standard 31
7. Commencement Date 31
8. Common Area 31
9. Complex 31
10. Fiscal Year 32
11. Force Majeure 32
12. Holidays 32
13. HVAC 32
14. Impositions 32
15. Land 32
16. Landlord's Mortgagee 32
17. Landlord's Work 33
18. Landlord's Work Completion Date 33
19. Legal Requirements 33
20. Net Rentable Area 33
21. Net Usable Area 33
22. Operating Expenses 33
23. Parking Facility 35
24. Permitted Use 35
25. Premises 35
26. Rent 35
27. Security Deposit 35
28. Taking or Taken 35
29. Tenant's Share 35
30. Transfer 35
31. Work Letter 36
EXHIBIT B: PREMISES 37
EXHIBIT C: RULES AND REGULATIONS 38
EXHIBIT D: DESCRIPTION OF LAND 42
EXHIBIT E: WORK LETTER AGREEMENT 43
(SIGNATURES) 46
SCHEDULE E-1 47
I. Floors 47
II. Base 47
III. Partitions 47
IV. Ceilings 48
V. Doors, Frames Interior Windows 48
VI. Painting 48
VII. Graphics 49
VIII. Hardware 49
IX. HVAC Outline Specifications 49
X. Electrical Outline Specifications 50
XI. Fire Sprinkling 50
XII. Construction Allowance 51
EXHIBIT F: RENEWAL OPTION 52
LEASE AGREEMENT
This LEASE AGREEMENT (this "Lease") is entered as of the 8th day of
May, 2001, by, between and among EsNet PROPERTIES, L.C., a Utah limited
liability company, as Landlord, and CAPTUREQUEST, INC., a Utah corporation, as
Tenant.
ARTICLE 1: DEFINITIONS
The definitions of certain of the capitalized terms used in this Lease
are set forth in the Glossary of Defined Terms attached as Exhibit A and by this
reference made a part hereof.
ARTICLE 2: PREMISES
Subject to the provisions of this Lease, Landlord hereby leases to
Tenant, and Tenant hereby leases from Landlord, approximately Three Thousand
Five Hundred Seventy-Eight (3,578) square feet of Net Rentable Area in the
Building, which space is outlined on the floor plan attached hereto as Exhibit B
and by this reference made a part hereof (the "Premises"). In connection with
such demise, Landlord hereby grants to Tenant the non-exclusive right to use
during the Term all Common Areas designated for the use of all tenants in the
Building, in common with all tenants in the Building and their invitees, for the
purposes for which the Common Areas are designed and in accordance with the
requirements of this Lease and all Legal Requirements. By occupying the
Premises, Tenant Accepts the Premises as being suitable for Tenant's intended
use of the Premises.
ARTICLE 3: TERM
The Term of this Lease shall commence on the Commencement Date (which
is scheduled to be September 1, 2001) and shall
expire at 5:00 p.m., on the date
which is Thirty-Six (36) months after the Commencement Date unless earlier
terminated as provided herein (the "Term").
ARTICLE 4: USE
Tenant shall occupy and use the Premises solely for lawfu1, general
business office purposes in strict compliance with the Building Rules and
Regulations from time to time in effect and all other Legal Requirements. Tenant
shall not use or occupy the Premises for any other use or purpose without the
prior written consent of Landlord, which consent can be withheld by Landlord in
Landlord's sole discretion. Tenant's occupancy of the Premises shall comply with
all local codes and ordinances.
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ARTICLE 5: RENT
5.1 Base Rent
In consideration of LandLord's leasing the Premises to Tenant, Tenant
shall pay to Landlord, as "Base Rent" for the Premises, the following amounts:
MONTHLY ANNUAL
TERM AMOUNT AMOUNT
---- ------- ------
Year 1 $4,472.50 $53,670.00
Year 2 $4,606.68 $55,280.16
Year 3 $4,744.88 $56,938.56
5.2 Additional Rent. For purposes of this Lease, Tenant's "Additional
Rent" for any Fiscal Year (or portion thereof) shall mean the product of (a) Net
Rentable Area of the Premises multiplied by (b) the Opening Expenses, divided by
the Net Rentable Area of the Building, all as applicable for the period in
question. By the Commencement Date, Landlord shall estimate the Additional Rent
to be due by Tenant for the balance of the Fiscal Year in which the Commencement
Date occurs. Thereafter, unless Landlord delivers to Tenant a revision of the
estimated Additional Rent, Tenant shall pay to Landlord, coincident with
Tenant's payment of Base Rent, an amount equal to the estimated Additional Rent
for the remainder of such year divided by the number of months remaining in such
year. From time to time during any Fiscal Year, Landlord may estimate and
re-estimate the Additional Rent to be due by Tenant for that Fiscal Year and
deliver a copy of the estimate or re-estimate to Tenant. Thereafter, the monthly
installments of Addition Rent payable by Tenant will be appropriately adjusted
in accordance with the estimation so that, by the end of the Fiscal Year, Tenant
shall have paid all of the Additional Rent as estimated by Landlord. After the
conclusion of each Fiscal Year during the Term, and after the termination or
expiration of the Term, Landlord shall deliver to ▇▇▇▇▇ a statement of actual
Additional Rent due by Tenant for the Fiscal year (or, with respect to
termination or expiration, the portion of the Fiscal Year) just ended: Within
thirty (30) days thereafter, Tenant shall pay to Landlord or Landlord shall
credit against the next installment of Additional Rent due by Tenant (or
Landlord shall refund to Tenant, if the Term has expired and all payments due by
Tenant to Landlord have been paid in full) the difference between the actual
Additional Rent due for such year and the estimated Additional Rent paid by
Tenant during such year.
5.3 Parking Charge. Tenant shall at all times during the Term lease
from Landlord two (2) assigned automobile parking spaces in the Parking
Facility, at a cost of Forty Dollars ($40.00) per month per space.
5.4 Payment of Rent. Except as otherwise expressly provided in this
Lease, all Rent shall be due in advance monthly installments on the first day of
each calendar month during the Term. Rent shall be paid to Landlord at its
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address recited in Section 27.7, or to such other person or at such other
address as Landlord may from time to time designate in writing. Rent shall be
paid without notice, demand, abatement, deduction or offset in legal tender of
the United States of America. If the Term commences or ends on other than the
first or the last day of a calendar month, the Rent for the partial month shall
be prorated on the basis of the number of days during such month for which the
Term was in effect. If fee Term commences or ends on other than the first or the
last day of a fiscal Year, the Additional Rent for the partial Fiscal Year shall
be prorated on the basis of the number of days during the fiscal Year for which
the Term was in effect.
Notwithstanding anything to the contrary in this lease, in the event
that Tenant fails to pay any payment of Base Rent when due, Tenant shall,
immediately upon demand from Landlord, issue and deliver to Landlord stocking
Tenant in lieu of Base Rent, with Tenant agreeing to deliver three (3) shares of
stock in Tenant for each dollar ($1.2O) of Base Rent then due. The immediately
preceding sentence shall not apply to Additional Rent, which shall only be
payable in cash.
5.5 Delinquent Payments and Handling Charge. All Rent and over payments
required of Tenant hereunder shall bear interest from the date due until the
date paid at the rate of interest specified in Section 27.13. In addition to
interest, if any such Rent or other payment is not received when due, Tenant
shall pay to Landlord a late charge equal to five (5%) percent of the amount of
such rent or other payment to reimburse Landlord for its cost and inconvenience
incurred as a consequence of Tenant's delinquency. In no event, however, shall
the charges permitted under this Section 5.5 or elsewhere in this Lease to the
extent the same are considered to be interest under applicable law, exceed the
maximum rate of interest allowable under applicable law.
5.6 Security Deposit. On the date of this Lease, Tenant shall deposit
with Landlord the Security Deposit as security for the faithful performance by
Tenant under this Lease. The Security Deposit shall be returned (without
interest) to Tenant (or, at Landlord's option, to the last permitted assignee of
Tenant's interest under this Lease) after the expiration of the Term, or sooner
termination of this Lease and delivery of possession of the Premises to Landlord
in accordance with Article 26 if, at such time, Tenant is not in default under
this Lease. If Landlord's interest in this Lease is conveyed, transferred or
assigned Landlord shall transfer or credit the Security Deposit to Landlord's
successor in interest, and Landlord shall be released from any liability for the
return of the Security Deposit. Landlord may intermingle the Security Deposit
with Landlord's own funds, and shall not be deemed to be a trustee of the
Security Deposit. If Tenant fails to timely pay or perform any obligation under
this Lease, Landlord may, prior to, concurrently with or subsequent to
exercising any other right or remedy, use, apply or retain all or any part of
the Security Deposit for the payment of any monetary obligation due under this
Lease, or to compensate Landlord for any other expense, loss or damage which
Landlord may incur by reason of Tenant's failure, including any damage or
deficiency in the reletting of the Premises, If all or any portion of the
Security Deposit is so used, applied or retained, Tenant shall immediately
deposit with Landlord cash in an amount sufficient to restore the Security
Deposit to the original amount. Landlord may withhold the Security Deposit after
the expiration of the Term or sooner termination of this Lease until Tenant has
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paid the full Tenant's Operating Expenses for the Fiscal Year in which such
expiration or sooner termination occurs and all other amounts payable under this
Lease. The Security Deposit is not a limitation on Landlord's damages or other
rights under this Lease, a payment of liquidated damages or prepaid Rent, end
shall not be applied by Tenant to the Rent for the last (or any) month of the
Term, or to any other amount due under this Lease. If this Lease is terminated
due to any default of Tenant, any portion of the Security Deposit remaining at
the time of such termination shall immediately inure to the benefit of Landlord
as partial compensation for the costs and expenses incurred by Landlord in
connection with this Lease.
ARTICLE 6: CONSTRUCTION OF IMPROVEMENTS
6.1 General. Subject to events of Force Majeure, Landlord shall
install, furnish, perform and apply, at its expense, the Landlord's Work as
specified in the Work Letter. Performance of the Landlord's Work shall
constitute Landlord's sole construction obligation to Tenant under this Lease.
6.2 Access by Tenant Prior to Landlord's Work Completion Date. Provided
that Tenant obtains and delivers to Landlord the certificates of policies of
insurance called for in Section 17.1, Landlord, in its sole discretion, may
permit Tenant and its employees, agents, contractors and suppliers to enter the
Premises before the Landlord's Work Completion Date (and such entry alone shall
not constitute Tenants taking possession of the Premises for the purpose of
Section 6.3), to prepare the Premises for Tenant's occupancy. Tenant and each
other person or firm who or which enters the Premises before the Landlord's Work
Completion Date shall conduct itself so as to not interfere with Landlord or
other occupants of the Building. Landlord may withdraw any permission granted
under this Section 6.2 upon twenty-four (24) hours' notice to Tentant if
Landlord, in its sole discretion, determines that any such interference has been
or may be caused. Any prior entry shall be under all the terms of this Lease
(other than the obligation to pay Base Rent and Additional Rent) and at Tenant's
sole risk. Landlord shall not be liable in any way for personal injury, death or
property damage (including damage to any personal property which Tenant may
bring into, or any work which Tenant may perform in, the Premises) which may
occur in or about the Complex by Tenant or such other person or firm as a resu1t
of any prior entry.
6.3 Commencement Date; Adjustments to Commencement Date. For purposes
of this Lease, the "Commencement Date" shall moan the earliest of (a) the date
on which Landlord substantially completes the Landlord's Work and tenders
possession of the Premises to Tenant, (b) the date on which Landlord would have
substantially completed the Landlord's Work and tendered possession of the
Premises to Tenant but for (i) the delay or failure of Tent to furnish
information or other matters required in the Work Letter, (ii) Tenant's request
for changes in the plans or non-Building Standard items, or (3) any other action
or inaction of Tenant, or any person or firm employed or retained by Tent, or
(c) the date on which Tenant takes possession of the Premises. If by the
scheduled Commencement Date specified in Article 3, the Landlord's Work has not
been substantially completed, and such failure to substantially complete renders
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the Premises unsuitable for the commencement of Tenant's business on the
Premises as reasonably determined by Landlord, then the Commencement Date (and
the commencement of payment of Base Rent and Additional Rent) shal1 be postponed
until the Landlord's Work is substantially completed as reasonably determined by
Landlord or until possession of the Premises is tendered to Tenant, as the case
may be. Such postponement shall extend the scheduled expiration of the Term for
a number of days equa1 to the postponement. The postponement of the payment of
Base Rent and Additional Rent under this Section 6.3 shall be Tenant's exclusive
remedy for Landlord's delay in completing the Landlord's Work or tendering
possession of the Premises to Tenant.
ARTICLE 7: SERVICE TO BE FURNISHED BY LANDLORD
7.1 General. Subject to applicable Legal Requirements, the provisions
of this Lease, and Tenant's performance of its obligations hereunder, landlord
shall use all reasonable efforts to furnish the following services:
(a) Air conditioning and heating to the Premises during Building
Operating Hours, at such temperatures and in such amounts as are
considered by Landlord to be suitable and standard (thus excluding air
conditioning or heating, for electronic data processing or other
specialized equipment). Air conditioning and heating of any areas which
require special treatment because of excessive heat from machines;
lights, or other sources, shall, upon Landlord's written consent, be
installed and paid for by Tenant and the additional electrical
consumption paid for by the Tenant at the then current utility rate.
(b) Hot and cold water at those points of supply common to all
floors for lavatory and drinking purposes only.
(c) Janitorial services shall be provided by Landlord for all
common areas in the Building in the manner consistent with other first
class buildings.
(d) Elevator service during Building Operating Hours, if
necessary, to provide access to and egress from the Premises.
(e) Electricity (for normal business usage) for wall plugs and for
lighting during Building Operating Hours, Tenants use of electric
energy in the Premises shall not at any time exceed the capacity of any
of the electrical conductors and equipment in or otherwise serving the
Premises. To insure that such capacity is not exceeded and to avert
possible adverse effect upon the Buildings electric service, Tenant
shall not, Without Landlord's prior written consent in each instance,
connect any additiom1 fixtures, equipment, or appliances (other than
lamps, typewriters and similar small office machines or personal
computers which singly consume not more than 0.5 kilowatts per hour at
rated capacity and use a voltage of 120 volts single phase) to the
Bui1ding's electric distribution system or make any alteration or
addition to the electric system of the Premises existing on the
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Commencement Date. Should Landlord grant such consent, and should such
additional capacity exceed 4.5 ▇▇▇▇▇ per square foot of Net Rentable
Area of the Premises, all additional risers or other equipment required
therefore, shall be provided by Landlord and the cost thereof shall be
paid by ▇▇▇▇▇ upon Landlord's demand. As a condition to granting such
consent Landlord may require Tentant to agree to an increase in the
Base Rent by an amount which will reflect the value to Tenant of the
additional service to be finished by Landlord; that is, the potential
additional electrical energy to be made available to Tenant based upon
the estimated additional capacity of such additional risers or other
equipment.
(f) Replacement of fluorescent lamps in Building Standard light
fixtures installed by Landlord and of incandescent bulbs or fluorescent
lamps all public restrooms, stairwells and other Common Areas n the
building.
If any of the services described above or elsewhere in this Lease are
interrupted, Landlord shall use reasonable diligence to promptly restore the
same. However, neither the interruption nor cessation of such services, nor the
failure of Landlord to restore same, shall render Landlord liable for damages to
person or property, or be construed as an eviction of Tenant, or work an
abatement of Rent or relieve Tenant from fulfilling any of its other obligations
hereunder. If not previously installed, Landlord may cause an electric and/or
water meter(s) to be installed in the Premises in order to measure the amount of
electricity and/or water consumed for any such use.
7.2 After Hours Heating Air Conditioning. Heating and air conditioning
shall be provided to the Premises during times other than Building Operating
hours by Tenant activating the after-hours switch in Premises provided, however,
that Tenant shall pay Landlord an hourly fee determined by and from time to
time adjusted by Landlord for providing such additional services.
7.3 Keys. Landlord shall furnish Tenant at Landlord's expense, with two
keys, and at Tenants expense with such additional keys as Tenant may request, to
unlock each corridor door entering the Premises. Tenant shall not install, or
permit to be installed, any additional lock on any door into or in the Premises
or make or permit to be made, any duplicates of key, to the Premises. Landlord
shall be entitled at all times to possession of a duplicate of all keys to all
doors to or inside of the Premises. All keys referred to in this Section 7.3
shall remain the property of the Landlord. Upon the expiration or termination of
the Term, Tenant shall surrender all such keys to Landlord and shall deliver to
Landlord the combination to all locks on all safes, cabinets, and vaults which
will remain in the Premises. Landlord shall be entitled to install, operate and
maintain security systems in or about the Premises and the Complex which
monitor, by closed circuit television or otherwise, all persons leaving or
entering the Complex, the Building and the Premises.
7.4 Tenant Identity. Landlord shall provide and install, in Building
Standard graphics, letters or numerals identifying Tenant's name and suite
number on entrance doors to the Premises. Without Landlord's prior written
consent, no other signs, numerals, letters, graphics, symbols, or marks
identifying Tenant shall be placed on the exterior, or in the interior if they
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are visable from the exterior, of the Premises. Landlord shall install one (1)
directory strip, listing the name and suite number of Tenant on the Building
directory board to be placed in the main lobby of the Building. Tenant shall not
place or suffer to be placed on any exterior door, wall or window of the
Premises, on any part of the inside of the Premises which is visible from the
outside of the Premises, or elsewhere on the Complex, any sign decoration,
lettering, attachment, advertising matter or other thing of any kind, without
first obtaining Landlord's written approval. Landlord may, at Tenant's cost, and
without notice or liability to Tenants enter the Premises and remove any item
erected in violation of this Section. Landlord may establish rules and
regulations governing the size, type and design of all such items and Tenant
shall abide by such rules and regulations. All approved signs or letterings on
doors shall be printed, painted and affixed at the sole cost of Tenant by a
person approved by Landlord, and shall comply with all Legal Requirements. At
Tenant's sole cost Tenant shall maintain all permitted signs and shall, on the
expiration, of the Term or sooner termination of this Lease remove all such
permitted signs and repair any damage caused by such removal.
7.5 Charges. Tenant shall pay to Landlord monthly as billed, as
Additional Rent such charges as may be separately metered or as Landlord may
compute for (a) any utility services utilized by Tenant for computers, data
processing equipment or other electrical equipment in excess of that agreed to
be furnished by Landlord pursuant to Section 7.1(e), (b) lighting installed in
the Premises in excess of Building Standard lighting, (c) air conditioning,
heating and other services in excess of that stated in Section 7.1(a) or
provided at times other than Building Operating Hours, and (d) janitorial
services required with respect to non-Building Standard Items within the
Premises. Landlord may elect to estimate the charges to be paid by Tenant under
this Section 7.5 and ▇▇▇▇ such charges to Tenant monthly in advance, in which
event Tenant shall promptly pay the estimated charges. When the actual charges
are determined by Landlord, and appropriate cash adjustment shall be made
between Landlord and Tenant to account for any underpayment or overpayment by
Tenant.
7.6 Operating Hours. Subject to Building Rules and Regulations and such
security standards as Land1ord may from time to time adopt, the Building shall
be open to the public during the Building Operating Hours and the Premises shall
be open to Tenant during hours other than Building Operating Hours.
ARTICLE 8~ REPAIR AND MAINTENANCE
8.1 By Landlord. Landlord shall maintain the Building, excepting the
premises and portions of the Building leased by persons not affiliated with
Landlord, in a good and operable condition, and shall make such repairs and
replacements as may be required to maintain the Building in such condition. This
Section 8.1 shall not apply to damage resulting from a Taking (as to which
Article 14 shall apply), or damage resulting from a casualty (as to which
Section 15.1 shall apply), or to damage for which Tenant is otherwise
responsible under this Lease.
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8.2 By Tenant. Tenant, at Tenant's sole cost, shall maintain the
Premises and every part of the Premises (including, without limitation, all
floors, walls and ceilings and their coverings, doors, and locks, furnishings,
trade fixtures, signage, leasehold improvements, equipment and other personal
property from time to time situated in or on the Premises) in good order,
condition and repair, and in a clean, safe, operable, attractive and sanitary
condition. Tenant will not commit or allow to remain any waste or damage to any
portion of the Premises. Tenant shall repair or replace, subject to Landlords
direction and supervision, any damage to the Complex caused by Tenant or Tenants
agents, contractors or invitees. If Tenant fails to make such repairs or
replacements, Landlord may make the same at Tenant's Cost. Such cost shall be
payable to Landlord by Tenant on demand as Additional Rent. All contractors,
workmen, artisans and other persons which or whom Tenant proposes to retain to
perform work in the Premises (or the Complex, pursuant to the third sentence of
this Section) pursuant to this Section 8.2 or Article 11 shall be approved by
Landlord prior to the commencement of any such work.
ARTICLE 9: TAXES ON TENANTS PROPERTY
Tenant shall be liable for and shall pay, before they become deliquent,
all taxes and assessments levied against any personal property placed by Tenant
in the Premises (even if same becomes a fixture by operation of law or the
property of Landlord by operation of this Lease), including any additional
Impositions which may be assessed, levied, charged or imposed against Landlord
or the Building by reason of non-Building Standard items in the Premises. Tenant
may withhold payments of any taxes and assessments described in this Article 9
so long as Tenant contests its obligation to pay in accordance with applicable
law and non-payment thereof does not pose a threat of loss or seizure of the
Building or any interest of Landlord therein.
ARTICLE 10: TRANSFER BY TENANT
10.1 General. Without the prior written consent of Landlord, Tenant
shall not effect or suffer any Transfer. Any attempted Transfer without such
consent shall be void. If Tenant desires to effect a Transfer, it shall deliver
to Landlord written notice thereof in advance of the date on which Tenant
proposes to make the Transfer, together with all the terms of the proposed
Transfer and the identity of the proposed Transferee. Landlord shall have
thirty (30) days following receipt of the notice and information within which to
notify Tenant in writing wether Landlord elects (a) to refuse to consent to the
Transfer and to terminate this Lease as to the space proposed to be subject to
Transfer as of thee date so specified by Tenant, in which event Tenant will be
relieved of all further obligations hereunder as to such space, (b) to refuse to
consent to the Transfer and to continue this Lease in full force as to the
entire Premises, or (c) to permit Tenant to effect the proposed Transfer. If
Landlord fails to notify Tenant of its election within said thirty (30) day
period, Landlord shall be deemed to have elected the option specified in Section
1O.1 (b). The consent by Landlord to a particular Transfer shall not be deemed a
consent to any other Transfer. If a Transfer occurs without the prior written
consent of Landlord as provided herein, Landlord may nevertheless collect rent
from the Transferee and apply the net amount collected to the Rent payable
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hereunder, but such collection and application shall not constitute a waiver of
the provision hereof or a release of Tenant from the further performance of its
obligations hereunder. No consent by Landlord to any Transfer shall relieve
Tenant of any obligation to be performed by Tenant under this Leases whether
such obligation arises prior to or after such consent.
10.2 Conditions. The following conditions shall automatically apply to
each Transfer, without the necessity of same being stated or referred to in
Landlord's written consent;
(a) Tenant shall execute, have acknowledged and deliver to
Landlord, and cause the Transferee to execute, have acknowledged and
deliver to Landlord, an instrument in form and substance acceptable to
Landlord in which (1) the transferee adopts this Lease and agrees to
perform, jointly and severally with Tenant all of the obligations of
Tenant hereunder, as to the space transferred to it, (2) the Transferee
grants Landlord an express first and prior security interest all its
personal property brought into the transferred space to secure its
obligations to Landlord hereunder, (3) Tenant subordinates to
Landlord's statutory lien and security interest any liens, security
interests or other rights which Tenant may claim with respect to any
such property of the Transferee, (4) Tenant agrees with Landlord that,
if any rent or other consideration payable by the Transferee to Tenant
exceeds the Rent for the transferred space, then Tenant shall pay
Landlord as Additional Rent hereunder all such excess rent and other
consideration immediately upon Tenant's receipt thereof, (5) Tenant and
the Transferee agree to provide to Landlord, at their expense, direct
access from a public corridor in the Building to the transferred space,
(6) The Transferee agrees to use and occupy the transferred space
solely for the purpose specified in Article 4 and otherwise in strict
accordance with this Lease, and (7) Tenant acknowledges that,
notwithstanding the Transfer, Tenant remains directly and primarily
liable for the performance of all the obligations of Tenant hereunder
(including, without limitation, the obligation to pay all Rent), and
Landlord shall be permitted to enforce this Lease against Tenant or the
Transferee, or both, without prior demand upon or proceeding in any way
against any other persons; and
(b) Tenant shall deliver to Landlord a counterpart of all
instruments relative to the Transfer executed by all parties to such
transaction (except Landlord).
(c) If Tenant requests Landlord to consent to a proposed Transfer,
Tenant shall pay to Landlord, whether or not consent is given,
Landlord's reasonable attorney's fees incurred in connection with such
request.
10.3 Liens. Without in any way limiting the generality of the
foregoing, Tenant shall not grant, place or suffer, or permit to be granted,
placed or suffered, against the Complex or any portion thereof, any lien,
security interest, pledge, conditional sale contract, claim, charge or
encumbrance (whether constitutional, statutory, contractual or otherwise) and,
if any of the aforesaid does arise or is asserted, Tenant will, promptly upon
demand by Landlord and at Tenant's expense, cause the same to be released.
14
ARTICLE 11: ALTERATIONS
Tenant shall not make (or permit to be made) any change, addition or
improvement to the Premises (including, without limitation, the attachment of
any fixture or equipment) unless such change, addition or improvement (a) equals
or exceeds the Building Standard and utilizes only new and first-grade
materials, (b) is in conformity with all legal requirements, and is made after
obtaining any required permit and licenses, (c) is made void prior written
consent of Landlord, (d) is made pursuant to plans and specification approved in
writing in advance by Landlord and prepared by an architect approved in writing
in advance by Landlord, (e) is made after Tenant has provided to Landlord such
indemnification, insurance, and/or bonds requested by Landlord, including,
without limitation, a performance and completion bond in such form and amount as
may be satisfactory to Landlord to protect against claims and lien for labor
performed and materials furnished, and to insure the completion of any change,
addition or improvement, (f) is carried out by persons approved in writing by
Landlord who, if required by Landlord, deliver to Landlord before commencement
of their work proof of such insurance coverage as Landlord may require, with
Landlord named as an additional insured, and (g) is done only at such time and
in such manner as Landlord may reasonably specify. All such alterations,
improvements and additions (including all articles attached to the floor, wall
or ceiling of the Premises) shall become the property of Landlord and shall at
Landlords election, be (1) surrendered with the Premises as part thereof at the
termination or expiration of the Term, without any payment, reimbursement or
compensation therefor, or (2) removed by Tenant, at Tenant's expense with all
damage caused by such removal repaired by Tenant. Tenant may remove Tenant's
trade fixtures, office supplies, movable office furniture and equipment not
attached to the Building, provided such removal is made prior to the expiration
of the term, no uncured Event of Default has occurred and Tenant promptly
repairs all damage caused by such removal, Tenant shall indemnify, defend and
hold harmless Landlord from and against all liens, claim, damages, losses,
liabilities and expenses, including attorneys' fees, which may arise out of, or
be connected in way with, any such change, addition or improvement. Within ten
(10) days following the imposition of any lien resulting from any such change,
addition or improvement, Tenant shall cause such lien to be released of record
by payment of money or posting of a proper bond.
ARTICLE 12: PROHIBITED USES
Tenant will not (a) use, occupy or permit the use or occupancy of the
Premises for any purpose or in any manner which is or may be, directly or
indirectly, violative of any Legal Requirement, or dangerous to life or
property, or a public or private nuisance, or disruptive of obstructive of any
other tenant or of the Building, (b) keep or permit to be kept any substance in,
or conduct or permit to be conducted any operation from, the Premises which
might emit offensive odors or conditions into other portions of the building, or
make undue noise or create undue vibrations, (c) commit or permit to remain any
waste to Premises, (d) install or permit to remain any improvements to the
Premises (other than window coverings which have first been approved by
15
Landlord) which are visible from the outside of the Premises, or exceed the
structural loads of floors or walls of the Building, or adversely affect the
mechanical, plumbing or electrical systems of the Building, or affect the
structure integrity of the Building in any way, (e) install any food soft drink
or other vending machine in the Premises, or (f) commitment or permit to be
committed any action or circumstance in or about the Building which, directly or
indirectly, would or might justify any insurance carrier in canceling or
increasing the premium on the fire and extend coverage Insurance policy
maintained by Landlord on the Building or contents, and if any increase results
from any act of Tenant then Tenant shall pay such increase promptly upon demand
therefor by Landlord.
ARTICLE 13: ACCESS BY LANDLORD
Landlord, its employees, contractors, agents, and representatives,
shall have the right (and Landlord, for itself and such persons and firms,
hereby reserves the right) to enter the Premises at all hours (a) to inspect,
clean, maintain, repair, replace or alter the Premises or the Building, (b) to
show the Premises to prospective purchasers (or, during the last twelve (12)
months of the Term, to prospective tenant(s), (c) to determine whether Tenant is
performing its obligations hereunder and, if it is not, to perform same at
Landlord's option and Tenant's expense or (d) for any other purpose deemed
reasonable by Landlord. In an emergency, Landlord (and such persons and firms)
may use any means to open any door into or in the Premises without any liability
therefor. Entry into the Premises by Landlord or any other person, or firm named
in the first sentence of this Article 13 for any purpose permitted herein shall
not constitute a trespass or an eviction (constructive or otherwise), or entitle
Tenant to any abatement or reduction of Rent, or constitute grounds for any
claim (and Tenant hereby waives any claim) for damages for any injury to or
interference with Tenants business, for loss of occupancy or quiet employment,
or for consequential damages.
ARTICLE 14: CONDEMNATION
If all of the Complex is Taken, or if so much of the Complex is Taken,
that in the landlord's opinion, the remainder cannot be restored to and
economically viable, quality office building, or if the awards payable to
Landlord as a result of any Taking mean landlord's opinion, inadequate to
restore the remainder to an economically viable, quality office building,
Landlord may, at its election exercisab1e by the giving of written notice to
Tenant within sixty (60) days after the date of the Taking, terminate this Lease
as of the date of Taking or the date Tenant is Deprived of possession of the
Premises (whichever is later). If this Lease is not terminated as a result of a
Taking, Landlord shall restore the Premises remaining after the Taking to a
Building Standard condition. During the period of restoration, Base Rent shall
be abated to the extent the Premises are rendered untenantable and, after the
period of restoration, Base Rent and Tenant's Share shall be reduced in the
proportion that the area of the Premises Taken or otherwise rendered
untenantable bears to the area of The Premises just prior to the Taking. If any
portion of Base Rent is abated under this Article 14, Landlord may elect to
extend the expiration date of the Term for the period of the abatement. All
awards, proceeds, compensation or other payments from or with respect to any
Taking of the Complex or any portion, thereof shall belong to Landlord, and
Tenant hereby assigns to Landlord all of its right, title, interest and Claim to
same. Whether or not this Lease is terminated as a consequence of a Taking, all
damages or compensation awarded for a partial or total Taking, including any
award for severance damage and any sums
16
compensating for diminution in the value of or deprivation of the
leasehold estate under this Lease, shall be the sole and exclusive property of
Landlord. Tenant may assert a claim for and recover from the condemning
authority, but not from Landlord, such compensation as may be awarded on
account of Tenants moving and relocation expenses, and depreciation to end loss
of Tenant's moveable personal property. Tenant shall have no claim against
landlord for the occurrence of any taking, or for the termination of this Lease
or a reduction in the Premises as a result of any Taking.
ARTICLE 15: CASUALTY
15.1 General. Tenant shall give prompt written notice to Landlord of
any casualty to the Complex of which Tenant is aware and any casualty to the
Premises. If the Complex or the Premises are totally destroyed, or if the
Complex or the Premises are partially destroyed but in Landlord's opinion they
cannot be restored to an economically viable, quality office building, or if the
insurance proceeds payable to Landlord as a result of any casualty are, in
Landlord's opinion inadequate to restore the portion remaining to an
economically viable' quality office building, Landlord may, at its election
exercisable by the giving of written notice to Tenant within sixty (60) days
after the casualty, terminate this Lease as of the date of the casualty or the
date Tenant is deprived of possession of the Premises (whichever is later). If
this Lease is not terminated as a result of a casualty, Landlord shall (subject
to Section 15.2) restore the Premises to a Building Standard condition. During
the period of restoration, Base Rent 5hall be abated to the extent the Premises
are rendered untenantable and, after the period of restoration, Base Rent and
Tenants Share shall be reduced in the proportion that the area of the Premises
remaining tenantable after the casualty bears to the area of the Premises just
prior to the casualty. If any portion of Base Rent is abated under this Section
15.1, Landlord may elect to extend the expiration date of the Term for the
period of the abatement. Except for abatement of Base Rent, if any, Tenant shall
have no clean against Landlord for any loss by reason of any such damage,
destruction, repair or restoration, nor may Tenant terminate this lease as the
result of any statutory provision in effect on or after the date of this Lease
pertaining to the damage and destruction of the Premises or the Building. The
proceeds of a11 Insurance carried by Tenant on Tenants furnishings, trade
fixtures, leasehold improvements, equipment, merchandise and other personal
property shall be held in trust by Tenant for the purpose of the repair and
replacement of the same. Landlord shall not be required to repair any damage to
or to make any restoration of any furnishings, trade fixtures, leasehold
improvements, equipment, merchandise and other personal property installed in
the Premises by Tenant or at the direct or indirect expense of Tenant
15.2 Acts of Tenant. Notwithstanding any provisions of this Lease to
the Contrary, if the Premises or the Complex are damaged or destroyed as a
result of a casualty arising from the acts or omissions of Tenant, or any of
Tenant's officers, directors, shareholders, partner, employees, contractors,
agents, invitees or representatives, {a) Tenant's obligation to pay Rent and to
perform its other obligations under this Lease stroll not be abated, reduced or
Altered in any manner, (b) Landlord shall not be obligated to repair or restore
the Premises or the Complex, and (c) subject to Section 17.2, Tenant shall be
obligated, at Tenant's cost, to repair and to restore
17
the Premises or the Complex to the condition they were in just prior to
the damage or destruction under the direction and Supervision of, and to the
satisfaction of, Landlord and any Landlords Mortgage.
ARTICLE l6: SUBORDINATION AND ATTORNMENT
16.1 General. This Lease, Tenant's leasehold estate created hereby, and
all Tenant's rights, titles and interests hereunder and in and to the Premises
are subject and subordinate to any Mortgage presently existing or hereafter
placed upon all or any portion of the Complex. However, Landlord and Landlord's
Mortgagee may, at any time upon the giving of Written notice to Tenant and
without any compensation or consideration being payable to Tenant, make his
Lease, and the aforesaid leasehold estate and rights, titles and interests,
Superior to an Mortgage. Upon the written request by Landlord and by Landlord's
Mortgagee to Tenant, and Within five (5) days of the date of such request, and
without any compensation or consideration being payable to Tenant, Tenant shall
execute, have acknowledged and deliver a recordable instrument confirming that
this Lease, Tenant's leasehold estate in the Premises and all of Tenant's
rights, titles and interests hereunder are subject and subordinate (or, at the
election of Landlord or Landlord's Mortgagee, superior) to the Mortgage
benefiting Landlord's Mortgagee.
16.2 Attornment: Upon the written request of any person or party
succeeding to the interest of Landlord under this Lease, Tenant shall
automatically become the tenant of and attorn to such successor in interest
without any change in any of the terms of this Lease. No successor in interest
shall be (a) bound by any payment of Rent for more than one month in advance,
except payments of security for the performance by Tenant of Tenant's
obligations under this Lease, or (b) subject to any offset, defense or damages
arising out of a default or any obligations of any preceding Landlord. Neither
Landlord's Mortgagee nor its successor in interest shall be bound by any
amendment of this Lease entered into after Tenant has been given written notice
of the name and address of Land1ord's Mortgagee and without the written consent
of Landlord's Mortgagee or such successor in interest. The subordination,
attornment and mortgagee protection clauses of this Article 16 shall be
self-operative and no further instruments of subordination attornment or
mortgagee protection need be required by any Landlord's Mortgagee or successor
in interest thereto. Nevertheless, upon the written request therefor and without
any compensation or consideration being payable to Tenant, Tenant agrees to
execute, have acknowledged and deliver such instruments as may be requested to
confirm the same. Tenant shall from time to time, if so requested by Landlord
and if doing so will not materially and adversely affect Tenant's economic
interests under this Lease, join with Landlord in amending this Lease so as to
meet thee needs or requirements of any lender that is considering making or that
has been made a loan secured by all or any portion of thee Complex.
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ARTICLE 15: CASUALTY
17.1 General. Tenant shall obtain and maintain throughout the Term the
following policies of insurance:
(a) Commercial general liability insurance with a combined single
limit for bodily injure and property damage of not less than One
Million Dollars ($l,OOO,0OO) per occurrence and Two Million Dollars
($2,000,000.00) aggregate, including, without limitation, contractual
liability coverage for the performance by Tenant of the indemnity
agreements set forth in Article l8.
(b) Hazard insurance with special causes of loss, including theft
coverage, insuring against fire, extended coverage risks, vandalism and
malicious mischief, and including boiler and sprinkler leakage
coverage, in an amount equal to the full replacements cost (without
deduction for depreciation) of all furnishings, trade fixtures,
leasehold improvements, equipment, merchandise and other personal
property from time to time situated in or on the Premises.
(c) Worker's compensation insurance satisfying Tenant's
obligations under the workers compensation laws of the State of Utah.
(d) Such other policy or policies of insurance as Landlord may
reasonably require or as Landlord is then requiring from one or more
other tenants in the Building.
Such minimum limits shall in no event limit the liability of Tenant
under this Lease. Such liability insurance shall name Landlord, and any other
person specified from time to time by Landlord, as an additional insured; such
property insurance shall name Landlord as a loss payee as Landlord's interests
may appear; and both such liability and property insurance shall be with
companies acceptable to Landlord, having a rating of not less than A:XII in the
most recent issue Best Key Rating Guide, Property-Casualty. All liability
po1icis maintained by Tenant shall contain a provision that Landlord and any
other additional insured, although named as an insured, shall nevertheless be
entitled to recover under such policies for any loss sustained by Landlord and
Landlord's agents and employees as a result of the acts or omissions of Tenant.
Tent shall furnish Landlord with certificates of coverage. No such policy shall
be cancelable or subject to reduction of coverage or other modification except
after thirty (30) days' prior written notice to Landlord by the insurer. All
such policies shall be written as primary policies, noncontributing with and not
in excess of the coverage which Landlord may carry, and shal1 only be subject to
such deductibles as may be approved in writing in advance by Landlord. Tenant
shall, at least ten (10) days prior to the expiration of such policies, furnish
Landlord with renewals of, or binders for, such policies. Landlord and Tenant
waive all rights to recover against each other, against any other tenant or
occupant of the Complex, and against the officers, directors, shareholders,
partners, joint venturers, employees, agents, customers, invitees or business
visitors of each other, or of any other tenant or occupant of the Building, for
any loss or damage arising from any cause covered by any insurance carried by
the waiving party, to the extent that such loss or damage is actually covered.
Tenant shall cause all other occupants of the Premises claiming by, through or
19
under Tenant to execute and deliver to Landlord a waiver of claims similar to
the waiver contained in this Section and to obtain such waiver of subrogation
rights endorsements. Any Landlord' Mortgagee may, at Landlord's option, be
afforded coverage under any policy required to be secured by Tenant under this
Lease by use of a mortgagee's endorsement to the policy concerned.
17.2 Waiver of Subrogation. Landlord hereby waives all claims, rights
of recovery and causes of action that Landlord or any party claiming by, through
or under Landlord May now or hereafter have by subrogation or otherwise against
Tenant or against any of Tenant's officers, directors, shareholders, members,
partners or employees for any loss or damage that may occur to the Complex, the
Premises, Tenant's improvements or any of the contents of any of the foregoing
by reason of fire or other casualty, or by reason of any other cause except
gross negligence, willful misconduct, or the failure by Tenant to observe any of
Tenant's obligations under this Lease (thus including simple negligence of the
Tenant or Tenant's officers, directors, shareholders, members, partners or
employees), that could have been insured against under the terms of the standard
fire and extended coverage insurance policies available in the state where the
Complex is located at the time of the casualty; provided, however, that the
waiver set forth in this Section 17.2 shall not apply to any deductibles on
insurance policies carried by Landlord or to any coinsurance penalty which
Landlord might sustain. Tenant hereby waives all claims, rights of recovery and
causes of action that Tenant or any party claiming by, through or under Tenant
may now or hereafter have by subrogation or otherwise against Landlord or
against any of Landlord's officers, directors, members, shareholders, members,
partners or employees for any loss or damage that may occur to the Complex, the
Premises, Tenant's improvements or any of the contents of any of the foregoing
by reason of fire or other casualty, or by reason of any other cause except
gross negligence or willfull misconduct (thus including simple negligence of the
Landlord or Landlord's officers, directors, shareholders, members, partners or
employees), that could have been insured against under the terms of the fire and
extended coverage insurance policies required to be obtained and maintained
under Section 17.1, Landlord and Tenant shall cause an endorsement to be issued
to their respective insurance policies recognizing this waiver of subrogation.
ARTICLE 18: TENANT'S INDEMNITY
Subject to Section 17.2, Tenant shall defend, indemnity and hold
harmless Landlord and Landlord's officers, directors, shareholders, members,
partners and employees from and against liabilities, obligations, losses,
damages, penalties, claims, actions, suits, costs, expenses and disbursements
(including court costs and reasonable attorneys' fees) resulting from any
injuries to or death of any person or damage to any property occurring during
the Term in or about the Premises.
20
ARTICLE l9: THIRD PARTIES; ACTS OF FORCE MAJEURE
LandLord shall have no liability to Tenant, or to Tenant's officers,
directors, shareholders, partners, employees, agents, contractors or invitees,
for bodily injury, death, property damage, business interruption, loss of
profits, loss of trade secrets or other tenant or such other direct or
consequential damages occasioned by (a) the acts or omissions of any other
Tenant's officers, directors, shareholders, partners, employees agents,
contractors or other invitees within the Complex, (b) Force Majeure, (c)
vandalism, theft, burglary and other criminal acts (other than those committed
by Landlord and its employees), (d) water leakage, or (e) the repair,
replacement, maintenance, damage, destruction or relocation of the Premises.
ARTlCLE 2O: SECURITY INTEREST
As security for Tenant's payment of Rent and performance of all of its
other obligations under this Lease, Tenant hereby grants to Landlord a security
interest in all property of Tenant now or hereafter placed in the Premises.
Landlord, as secured party, shall be entitled to all of the rights, remedies and
recourse afforded to a secured party under the Utah Uniform Commercial Code,
which rights, remedies and recourse shall be cumulative of all other rights,
remedies, recourse, liens and security interests afforded Landlord by law,
equity or this Lease. Contemporaneously with the execution of this Lease, Tenant
shall execute and deliver, as debtor, promptly upon request and without any
compensation or consideration being payable to Tenant, such additional financing
statement or statements as Landlord may request. However, Landlord may at any
time file a copy of this Lease as a financing statement.
ARTICLE 21: CONTROL OF COMMON AREAS
Landlord shall have the exclusive controL over the Common Areas.
Landlord may, from time to time, create different Common Areas, close or
otherwise modify the Common Areas, and modify the Building Rules and Regulations
with respect thereto.
ARTICLE 22: RIGHT TO RELOCATE
Landlord retains the right and power, to be exercised reasonably and at
Landlord's expense, to relocate Tenant within the Building in space which is
comparable in size to the Premises and is suited to Tenant's use. Instances when
the exercise of Landlord's right and power to relocate Tenant shall be deemed
reasonable include, but shall not be limited to, instances where Landlord
desires to consolidate the rentable area in the Building to provide Landlord's
services more efficiently, or to provide contiguous vacant space for a
prospective tenant, Landlord shall not be liable to Tenant for any claims
arising in connections with a relocation permitted under this Article 22.
21
ARTICLE 23: QUIET ENJOYMENT
Provided Tenant has performed all its obligations under this Lease,
Tenant shall and may peaceably and quietly have, hold, occupy, use and enjoy the
Premises during the term subject to the provisions of this Lease. Landlord shall
warrant and forever defend Tenant's right to occupancy of the Premises against
the claims of any and all persons whosoever lawfully claiming the same or any
part thereof, by, through or under Landlord, but not otherwise, subject to the
provisions of this Lease.
ARTICLE 24: DEFAULT BY TENANT
24.1 Events of Default. Each of the following occurrences shall
constitute Event of Default (herein so called):
(a) The failure of Tenant to pay Rent as and when due hereunder
and continuance of such failure for a period of three days after
written notice from Landlord to Tenant specifying the failure;
provided, however, after Landlord has given Tenant written notice
pursuant to this Section 24.1(a) on two separate occasions, Landlord
shall not be required to give ▇▇▇▇▇ any further notice under this
Sector 24.l(a);
(b) The failure of Tenant to perform, comply with or observe any
other agreement, obligation or undertaking of Tenant, or any other
term, condition or provision in this Lease, and the continuance of such
failure for a period of ten (10) days after written notice from
Landlord to Tenant specifying the failure;
(c) The abandonment of the Premises by Tenant or the failure of
Tenant to occupy the Premises or any significant portion thereof;
(d) The filing of a petition by or against Tenant (the teen
"Tenant" also meaning for the purpose of this Section 24.1(d), any
guarantor of the named Tenant's obligations hereunder) (1) in any
bankruptcy or over insolvency proceeding, (2) seeking any relief under
the Bankruptcy Code or any similar debtor relief law, (3) for the
appointment of a liquidator or receiver for all or substantially all of
Tenant's property or for Tenant's interest in this Lease, or (4) to
reorganize or modify Tenant's capital structure; and
(e) The admission by Tenant in writing that it cannot meet its
obligations as they become due or the making by Tenant of an assignment
for the benefit of its creditors.
24.2 Remedies of Landlord. Upon any Event of Default, Landlord may, at
Landlord's option and in addition to all other rights, remedies and recourse
afforded Landlord hereunder or by law or equity, of any one or more of the
following:
(a) At Landlord's option and without waiving any default by
Tenant, Landlord shall have the right to continue this Lease in full
force and effect and to collect all Base Rent, Additional Rent, and any
other amounts to be paid by Tenant under its Lease as and when due.
During any period that Tenant is in default, Landlord shall have the
right, pursuant to legal proceedings or pursuant to any notice provided
for by law, to enter and take possession of the Premises, without
22
terminating this Lease, for the purpose of reletting the Premises or
any part thereof and making any alterations and repairs that may be
necessary or desirable in connection with such reletting. Any such
reletting or relettings may be for such term or terms (including
periods that exceed the balance of the term of this Lease), and upon
such other terms, covenants and conditions as Landlord may in
Landlord's sole discretion deem advisable. If the rent or rents
received during any month and applied as provided above shall be
insufficient to cover all such mounts including the Base Rent and any
other amounts to be paid by Tenant pursuant to this Lease for such
month, Tenant shall pay to Landlord any deficiency; such deficiencies
shall be calculated and paid monthly. No entry or taking possession of
the Premises by Landlord shall be construed as an election by Landlord
to terminate this lease, unless Landlord gives written notice of such
election to Tenant or unless such termination shall be decreed by a
court of competent jurisdiction. Notwithstanding any reletting by
Landlord without termination, Landlord may at any time thereafter
terminate this Leash for such previous default by giving written notice
thereof to Tenant.
(b) Terminate Tenant's right to possession by notice to Tenant,
which case this Lease shall terminate and Tenant shall immediately
surrender possession of the Premises to Land1ord. In such event
Landlord shall be entitled to recover from Tenant all damages incurred
by Landlord by reason of Tenants default, including without limitation
the following; (1) all unpaid Rent which has been earned at the time of
such termination plus (2) the amount by which the unpaid Rent which
would have been earned after termination until the time of award
exceeds the amount of such rental loss that is proved could have been
reasonably avoided; plus (3) any other amount necessary to compensate
Landlord for all the detriment proximately caused by Tenant's failure
to perform Tenant's obligations under this Lease, or in addition to or
in lieu of the foregoing such damages as may be permitted from time to
time under applicable State law. Upon any such re-entry Landlord shall
have the right to makes any reasonable repairs, alterations or
modifications to the Premises, which Landlord in Landlord's sole
discretion deems reasonable and necessary.
(c) If an Event of Default specified in Section 24.1(c) occurs,
Landlord may remove and store any property that remains on the Premises
and, if Tenant does not claim such property within ten (10) days after
Landlord has delivered to Tenant notice of such storage, Landlord may
appropriate, sell, destroy or otherwise dispose of the property in
question without notice to Tenant or any other person and without an
obligation to account for such property.
24.3 Payment by Tenant. Upon any Event of Default, Tenant shall also
pay to Landlord all costs and expenses incurred by Landlord, including court
costs and reasonable attorneys' fees, in (a) retaking or otherwise obeying
23
possession of the Premises, (b) removing and storing Tenant's or another
occupant's property, (c) repairing, restoring, altering, remodeling or otherwise
putting the Premises into condition acceptable to a new tenant or tenants, (d)
reletting all or an part of the Premises, (e) paying or performing the
underlying obligation which Tenant failed to pay or perform, and (f) enforcing
any of Landlord's rights, remedies of recourse arising as a consequence of the
Event of Default.
24,4 Reletting. Upon termination of this Lease or upon termination of
Tenant's right to possession of the Premises, Landlord shall use reasonable
efforts to relet the Premises on such terms and conditions as Landlord in its
sole discretion may determine (including a term different than the Terms, rental
concession, and alterations to and improvements of the Premises); however,
Landlord shall not be obligated to relet the Premises before leasing other
portions of the Building. Landlord shall not be liable for, nor shall Tenant's
obligations hereunder be diminished because of, Landlord's failure to relet the
Premises or collect rent due with respect to such reletting. If Landlord relets
the Premises, rent Landlord receives from such reletting shall be applied to the
payment of; first, any indebtedness from Tenant to Landlord other than Rent (if
any); second, all costs, including for maintenance and alterations, incurred by
Landlord in reletting; and third, Rent due and unpaid. In no event shall Tenant
be entitled to the excess of any rent obtained by reletting over the Rent herein
reserved.
24.5 Landlord's Right to Pay or Perform. Upon an Event of Default,
Landlord may, but without obligation to do so and without thereby waiving or
curing such Event of Default, pay or perform the underlying obligation for the
account of Tenant, and enter the Premises and expend the Security Deposit, if
any, and any other sums for such propose.
24.6 No Waiver, No Implied Surrender. Provisions of this Lease may only
be waived by the party entitled to the benefit of the provision evidencing the
waiver in writing. Thus, neither the acceptance of Rent by Landlord following an
Event of Default (whether known to Landlord or not), nor any other custom or
practice followed in connection with this Lease, shall constitute a waiver by
Landlord of such Event of Default or another Event of Default. Further, the
failure by Landlord to complain of any action or inaction by Tenant, or to
assert that any action or inaction by Tenant constitutes (or would constitute,
with the giving of notice and the passage of time) an Event of Default,
regardless of how long such failure continues, shall not extinguish, waive or in
any way diminish the rights, remedies and recourse of Landlord with respect to
such action or inaction. No waiver by Landlord of any provision of this Lease or
of any breach by Tenant of any obligation of Tenant hereunder shall be deemed to
be a waiver of any other provisions hereof, or of any subsequent breach by
Tenant of the same or any other provision hereof. Landlord's consent to any act
by Tenant requiring Landlord's consent shall not be deemed to render unnecessary
the obtaining of Landlord's consent to any subsequent act of Tenant. No act or
omission by Landlord (other than Landlord's execution of a document
acknowledging such surrender) or Landlord's agents, including the delivery of
the keys to the Premises, shall constitute an acceptance of a surrender of the
Premises.
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ARTICLE 25: DEFAULT BY LANDLORD
Landlord shall not be in default under this Lease, and Tenant shall not
be entitled to exercise any right, remedy or recourse against Landlord or
otherwise as a consequence of any alleged default by Landlord under this Lease,
unless Landlord fails to perform any of its obligations hereunder and said
failure continues for a period of thirty (30) days after Tenant gives Landlord
and (provided that Tenant shall have been given the name and address of
Landlord's Mortgagee) Landlord's Mortgagee written notice thereof specifying,
with reasonable particularity, the nature of Landlords failure. If, however, the
failure cannot reasonably be cured within the thirty (30) day period, Landlord
shall not be in default hereunder if Landlord or Landlord's Mortgagee commences
to cure the failure within the thirty (30} days and thereafter pursues the
curing of same diligently to completion. If Tenant recovers a money judgment
against Landlord for Landlord's default of its obligations hereunder or
otherwise, the judgement shall be limited to Tenant's actual direct, but no
consequential, damages therefor and shall be satisfied only out of the interest
of Landlord in the Complex as the same may then be encumbered, and Landlord
shall not otherwise be liable for any deficiency. In no event shall Tenant have
the right to levy execution against any property of Landlord other than its
interest in the Complex. The foregoing shall not limit any right that Tenant
might have to obtain specific performance of Landlord's obligations hereunder.
ARTICLE 26: RIGHT OF RE-ENTRY
Upon the expiration or termination of the Term for whatever cause, or
upon the exercise by Landlord of its right to reenter the Premises without
terminating this Lease, Tenant shall immediately, quietly and peaceably
surrender to Landlord possession of the Premises in "broom clean" and good
order, condition and repair, except only for ordinary wear and tear, damage by
casualty not covered by Section 15.2 and repairs to be made by Landlord
pursuant to Section 15.1. If Tenant is in default under this Lease, Landlord
shall have alien on such personal property, trade fixtures and other property as
set forth in Section 38-3-1, et seq., of the Utah Code ▇▇▇. (Or any replacement
provision). Landlord may require Tenant to remove any personal property, trade
fixtures, other property, alterations, additions and improvements made to the
Premises by Tenant or by Landlord for Tenant, and to restore the Premises to
their condition on the date of this Lease. All personal property, trade fixtures
and other property of Tenant not removed from the Premises on the abandonment of
the Premises or on the expiration of the Term or sooner termination of this
Lease for any cause shall conclusively be deemed to have been abandoned and may
be appropriated, sold, stored, destroyed or otherwise disposed of by Landlord
without notice to, and without any obligation to account to, Tenant or any other
person. Tenant shall pay to Landlord all expenses incurred in connection with
the disposition of such property in excess of any amount received by Landlord
from such disposition. Tenant stall not be released from Tenant's obligations
under this Lease in correction with surrender of the Premises until Landlord has
inspected the Premises and delivered to Tenant a written release. While Tenant
remains in possession of the Premises after such expiration, termination or
exercise by Landlord of its re-entry right. Tenant shall be deemed to be
occupying the Premises as a tenant-at-sufferance, subject to all of the
obligations of Tenant under this Lease, except that the daily Rent shall be
twice the per-day Rent in effect immediately before such expiration, termination
or exercise by Landlord. No such holding over shall extend the Term. If Tenant
fails to surrender possession of the Premises in the condition herein required,
Landlord may, at Tenant's expense, restore the Premises to such condition.
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ARTICLE 27: GENERAL PROVISIONS
27.1 Independent Obligations; No Offset. The obligations of Tenant to
pay Rent and to perform the other undertakings of Tenant hereunder constitute
independent unconditional obligations to be performed at the times specified
hereunder, regardless of any breach or default by Landlord hereunder. Tenant
shall have no right, and Tenant hereby waives and relinquishes all rights which
Tenant might otherwise have, to claim any nature of lien against the Complex or
to withhold, deduct form or offset against any Rent or other sums to be paid to
Landlord by Tenant.
27.2 Time of Essence. Time is of the essence with respect to each date
or tine specified in this Lease by which an event is to occur.
27.3 Applicable Law. THIS LEASE SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF UTAH. ALL MONETARY AND OTHER
OBLIGATIONS OF LANDLORD AND TENANT ARE PERFORMABLE IN THE COUNTY WHERE THE
COMPLEX IS LOCATED.
27.4 Assignment by Landlord. Landlord shall have the right to assign,
in whole or in part, any or all of its rights, titles or interests in and to the
Complex or this Lease and, upon any such assignment, Landlord shall be relieved
of all unaccrued liabilities and obligations hereunder to the extent of the
interest so assigned.
27.5 Estoppel Certificates; Financial Statements. Tenant shall, from
time to time and within ten (10) days of written request from either Landlord of
Landlord's Mortgagee, and without compensation or consideration execute, have
acknowledged and deliver a certificate setting forth the following: (a) a
ratification of this Lease; (b) the Commencement Date and expiation date, (c)
that this lease is in fill force and effect and has not been assigned,
modified, supplemented or amended (except by such writing as shall be stated)
(d) that this Lease, as modified, supplemented or amended (if such is the case)
constitutes the complete agreement between Landlord and Tenant with respect to
the Premises, the Building, and the Complex and that Tenant does not hold an
option to purchase the Complex or any interest therein, (e) that all conditions
under this Lease to be performed by Landlord have been satisfied or, in the
alternative, those claimed by Tenant to be unsatisfied; (f) that no defenses or
offsets exist against the enforcement of this Lease by Landlord or, in the
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alternative, those claimed by Tenant to exist; (g) whether within the knowledge
of Tenant there are any existing breaches or defaults by Landlord hereunder
and, if so, stating the defaults with reasonable particularity; (h) the amount
of advance Rent, if any (or none if such is the case), paid by Tenant, (i) the
date to which Rent has been paid; (j) the amount of the Security Deposit, if
any, and {k) such other information as Landlord or Landlord's Mortgagee may
Request. Landlord's Mortgagee and purchasers from either Landlord's Mortgagee or
Landlord shall be entitled to rely on any estoppel certificate executed by
Tenant. Tenant shall, within ten (1O) days after Landlord's request, furnish to
Landlord current financial statements for Tenant, prepared in accordance with
generally accepted accounting principles consistently applied and certified by
Tenant to be true and correct.
27.6 Signs, Building Name and Building Address. Landlord may, from time
to time at its discretion, maintain any and all signs anywhere in the Complex,
and may change the name and street address of the Complex. Tenant shall not use
the name of the Building for any purpose other than as the address of the
building for the business to be conducted by Tenant from the Premises.
27.7 Notices. All notices and other communications given pursuant to
this Lease shall be in writing and shall either be mailed by first class United
States mail, postage prepaid registered or certified with return receipt
requested, and addressed as set forth in this Section 27.7, or delivered in
person to the intended addressee, or sent by prepaid telegram, cable or telex
followed by a confirmatory letter. Notice mailed in the aforesaid manner shall
become effective three (3) business days after deposit; notice given in any
other manner, and any notice given to Landlord, shall be effective only upon
receipt by the intended addressee. For the purposes of notice, the address of
(a) Landlord shall be at the Building manager's office at the Buildings
manager's office at ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, and
(b) Tenant shall be, prior to the Commencement Date, the address recited on the
signature page hereof, and after the Commencement Date, the Premises. Each party
shall have the continuing right to change its address for notice hereunder by
the giving of fifteen (15) days' prior written notice to the other party in
accordance with this Section 27.7.
27.8 Entire Agreement, Amendment and Binding Effect. This Lease
constitutes the entire agreement between Landlord and Tenant relating to the
subject matter hereof, and all prior agreements relative hereto which are not
contained herein are terminated. This Lease may be amended only by a written
document duly executed by Landlord and Tenant (and, if a Mortgage is then in
effect, by the Landlord's Mortgagee entitled to the benefits thereof), and any
alleged amendment which is not so documented shall not be effective as to either
party. The provision of this Lease shall be binding upon and inure to the
benefit of the parties hereto and their heirs, executors, administrators,
successors and assigns, provided, however, that this Section 278 shall not
negate diminish or alter the restrictions on Transfer applicable to Tenant set
for elsewhere in this Lease.
27.9 Severability. This Lease is intend to be performed in accordance
with and only to the extent permitted by all Legal Requirements. If any
provision of this Lease or the application thereof to any person or
circumstances shall, for any reason and to any extent, be invalid or
unenforceable, but the extent of the validity or unenforceability does not
destroy the basis of the bargain between the parties as contained herein, the
remainder of this Lease and the application of such provision to other persons
or circumstances shall not be affected thereby, but rather shall be enforced to
the greatest extent permitted by law.
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27.10 Number and Gender, Captions and References. As the context of
this Lease may require, pronoun shall include nuteral persons and legal entities
of every kind and character, the singular number shall include the plural, and
the neuter shall include the masculine and the feminine gender. Section headings
in this Lease are for convenience of reference only and are not intended, to any
extent and for any purpose, to limit or define any section hereof. Whatever the
terms "Hereof," "hereby," "herein," "hereunder" or words of similar import are
used in this Lease, they shall be construed as referring to this Lease in its
entirety rather than to a particular section or provision unless the context
specifically indicates to the contrary. Any reference to a particular "Section"
shall be construed as referring to the indicated section of this Lease.
27.11 Attorney's Fees. In the event either party commences a legal
proceeding to enforce any of the terms of this Lease, the prevailing party in
such action shall have the right to recover reasonable attorney fees and costs
from the other party, to be fixed by the court in the same action. "Legal
proceedings" includes appeals from a lower court judgement as well as
proceedings in the Federal Bankruptcy Court ("Bankruptcy Court'], whether or not
they are adversary proceedings or contested matters. The "prevailing party" (a)
as used in the context of proceedings in the Bankruptcy Court means the
prevailing party in an adversary proceedings or contested matter, or in other
actions taken by the non-bankruptcy party which are reasonably necessary to
protect its rights under this Lease, and (b) as used in the context of
proceedings in any court other than the Bankruptcy Court, means the party that
prevails in obtaining a remedy or relief which most nearly reflects the remedy
or relief which the party sought; so that, for example, the prevailing party may
be a party which is ordered to pay One Hundred Dollars ($100) where the
obligation to pay Eighty Dollars ($80) was undisputed and the claiming party
alleged that it was entitled to One Thousand Dollars ($1,000).
27.12 Brokers. Tenant and Landlord hereby warrant and represent unto
the other that it has not incurred or authorized any brokerage commission,
finder's fees or similar payments in connection with this lease, other than that
which is due to NA, which payment shall by paid by NA. Each party shall defend,
indemnify and hold the other harmless from and against any claim for brokerage
commission, finder's, fees or similar payment arising by virtue of authorization
of such party, or any affiliate of such party, in connections with this Lease.
27.13 Interest on Tenant's Obligations. Any amount due from Tenant to
Landlord which is not paid when due shall bear interest at the lesser of
eighteen percent (18%) per annum or the maximum rate allowed by law from the
date such payment is due until paid, but the payment of such interest shall not
excuse or cure the default in payment.
27.14 Authority. The person executing this Lease on behalf of Tenant
personally warrants and represents to Landlord that (a) Tenant is a duly
organized and existing legal entity, in good standing in the State of Utah, (b)
Tenant has full right and authority to execute, deliver and preform this Lease,
(c) the person executing this Lease on behalf of Tenant was authorized to do so,
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and (d) upon request of Landlord, such person will deliver to Landlord
satisfactory evidence of his or her authority to execute this Lease on behalf of
Tenant.
27.15 Recording. Neither this Lease (including any Exhibit hereto) nor
any memorandum hereto shall be recorded without the prior written consent of
Landlord.
27.16 Exhibits. All Exhibit and written addenda hereto are incorporated
herein for any and all purposes.
27.17 Multiple Counterparts. This Lease may be executed in two or more
counterparts, each of which shall be an original, but all of which shall
constitute but one instrument.
27.18 Miscellaneous, Any guaranty delivered in connection with this
Lease is an integral part of this Lease and constitutes consideration given to
Landlord to enter into this Lease. No amendment to this Lease shall be binding
on Landlord or Tenant unless reduced to writing and signed by both parties. Each
provision to be performed by Tenant shall be construed to be both a covenant and
a condition. Venue on any action arising out of this Lease shall be proper only
in the District Court of Utah County, State of Utah. Landlord and Tenant waive
trial by jury in any action, proceeding or counterclaim brought by either of
them against the other on all matters arising out of this Lease or the use and
occupancy of the Premises. The submission of this Lease to Tenant is not an
offer to lease the Premises for Tenant. Landlord shall not be bound to Tenant
until Tenant has duly executed and delivered duplicate original copies of this
Lease to Landlord and Landlord has duly executed and delivered one of those
duplicate original copies to Tenant.
EXECUTED as of the date and year above first written.
TENANT ACKNOWLEDGES THAT LANDLORD HAS MADE NO WARRANTIES TO TENANT AS
TO THE CONDITION OF THE PREMISES, EITHER EXPRESSED OR IMPLIED, AND LANDLORD AND
TENANT EXPRESSLY DISCLAIM ANY IMPLIED WARRANTY THAT THE PREMISES ARE SUITABLE
FOR TENANTS INTENDED COMMERCIAL PURPOSE, AND TENANT'S OBLIGATION TO PAY RENT
HEREUNDER IS NOT DEPENDENT UPON THE CONDITION OF THE PREMISES OR THE PERFORMANCE
BY LANDLORD OF ITS OBLIGATIONS HEREUNDER, AND TENANT SHALL CONTINUE TO PAY THE
RENT, WITHOUT ABATEMENT (EXCEPT AS OTHERWISE EXPRESSLY PROVIDED HEREIN), SET OFF
OR DEDUCTION, NOTWITHSTANDING ANY BREACH BY LANDLORD OF ITS DUTIES OR
OBLIGATIONS HEREUNDER, WHETHER EXPRESS OR IMPLIED.
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