E-73
Exhibit No. 10
Form 10-▇▇
▇▇▇, Inc.
COMMERCIAL LEASE (10-21-98)
THIS LEASE (the "Lease") dated this 4 day of November, 1998,
is entered into by and between DRAPER LAND LIMITED PARTNERSHIP
No.2, a Utah limited partnership ("Landlord"), and BUYERS UNITED
INTERNATIONAL, a Utah Corporation ("Tenant").
1. PREMISES.
(a) Description. Landlord hereby leases to Tenant, and
Tenant hereby leases from Landlord, for the term and subject to
the terms and conditions hereinafter set forth, to each and all
of which Landlord and Tenant hereby mutually agree, those certain
premises (the "Premises"), highlighted on Exhibit A attached
hereto, which include approximately 2,602 Rentable square feet of
office space (the exact Rentable square footage and location to
be determined by final space plan). The location of the Premises
is commonly known as: ▇▇▇▇▇▇▇▇ ▇, ▇▇▇▇▇ ▇▇▇, ▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇ Drive, Draper, Utah 84020.
(b) Additional Use. In addition, the Premises shall include
the appurtenant right to use, in common with others, the site,
parking and landscaped areas. Landlord shall provide Tenant, at
no additional charge, the use of 5 non-reserved parking stalls
per every 1,000 square feet of usable space.
(c) Acceptance of Premises. Unless otherwise notified by
Tenant within thirty (30) days of taking possession, by entry
hereunder Tenant accepts the Premises as being in the condition
in which Landlord is obligated to deliver the Premises. Tenant
shall at the end of the term and any extension herein surrender
to Landlord the Premises and all alterations, additions and
improvements thereto in the same condition as when received;
ordinary wear and tear, damage by fire, earthquake, or act of God
excepted. Landlord has no liability and has made no
representation to alter, improve, repair, or paint the Premises
or any part thereof, except as specified in Article 2(c), 2(d) &
6 herein.
2. TERM, OPTION, TENANT IMPROVEMENTS.
(a) Lease Term. The initial Lease Term shall be 66 months
and shall commence on December 20, 1998 ("Commencement Date"),
which Commencement Date is subject to the substantial completion
of Tenant Improvements. If Landlord is solely responsible for not
delivering possession of the Premises to Tenant within forty-five
(45) days of the Commencement Date, Tenant may upon ten (10) days
written notice terminate the Lease. In the event of Tenant's
termination due to late delivery, Landlord shall not be liable to
tenant for any damage of any kind resulting from such late
delivery or failure to deliver possession of the Premises.
(b) Option. Provided that Tenant is not in default under
the Lease (either at the time of exercise of the option or at the
time of the commencement of the option period), Tenant shall have
the option to extend the term of the Lease for one 5-Year period,
by delivering written notice to Landlord exercising this option
no later than one hundred fifty (150) days prior to the
expiration of the existing Lease Term. Tenant shall possess the
Premises during the option period upon same terms and conditions
of the Lease except that Base Rent under Article 4(a) herein will
be increased
for the first year of the option period to 95% of the then
current effective market rate for similar space in similar
condition in the surrounding area. In no event will the Base Rent
for the option period be less than the Base Rent during the final
year of the initial Lease Term.
(c) Base Building Improvements. At Landlord's sole cost and
expense, Landlord shall design, construct and install the
Building's roof and structural elements ("Shell"), shall provide
basic utility access to and an initial HVAC unit for the
Premises, and shall design and construct the common areas of the
Premises and Building, as more specifically outlined in Exhibit B
- Base Building Improvements (collectively "Base Building
Improvements"). Any improvements made to Building at the request
of Tenant beyond those specified in Exhibit B shall be considered
Tenant Improvements.
(d) Tenant Improvements. At execution of the Lease, Tenant
shall commence the building design, construction and installation
of agreed-upon Tenant Improvements as provided for in Exhibit C -
Tenant Improvements Construction With Tenant Improvement
Allowance (collectively "Tenant Improvements").
3. NON-OCCUPANCY OF IMPROVED SPACE.
In the event Tenant does not occupy the Premises, except as
provided for in the event of termination, and fails to pay Rents
as required in Article 4 of the Lease, all costs for Tenant
Improvements become due and payable upon invoicing by Landlord.
Further, such invoicing by Landlord does not waive any other
rights or remedies Landlord may have against Tenant for failure
to occupy.
4. RENT.
4.1 Base Rent. Total Base Rent shall be $12.50 per Rentable
square foot or $32,525.00+ subject to an annual increase as
provided below, payable as follows: $2,710.42+ per month payable
in advance on or before the 1st day of each month during the
duration of the Lease, with the first such monthly rental
payments, plus the one month's security deposit per Section 31,
being due upon the execution of the Lease. This Base Rent is
estimated herein since the square footage is approximated. The
exact Base Rent will be determined according to the square
footage stated in the final space plan. Any partial months shall
be prorated accordingly. Base Rent under this Article shall be
increased by 3.5% per year after the twelfth (12) month of the
Lease Term and each year thereafter including during any option
period (after adjustment to fair market value at the beginning of
the option period) as provided in section 2b. All Base Rent and
Additional Rent (collectively "Rents") shall be paid as follows,
unless otherwise directed in writing, to Prime Commercial
Management, ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇, Attn: ▇▇▇▇▇ ▇▇▇▇.
4.2 Operating Expenses. Tenant shall pay to Landlord during the
term hereof, in addition to the Base Rent, Tenant's Share, as
hereinafter defined, of all Operating Expenses, as hereinafter
defined, during each calendar year of the term of this Lease, in
accordance with the following provisions:
(a) "Tenant's Share" is defined, for purposes of this
Lease, as a fraction in which the numerator is the number of
rentable square feet in the Premises and the denominator is the
total number of rentable square feet in the Building. Based on
the approximate square footage of the Premises, Tenant's Share is
2.602 SF, or 3.8 %. The exact Tenant's Share will be calculated
when the exact square footage of the Premises is known.
(b) "Operating Expense" is defined, for purposes of
this Lease, as all costs incurred by Landlord, if any, for:
(i) The operation, repair and maintenance, in neat,
clean, good order and condition, of the following:
(aa) All common areas in or around the Building,
including parking areas, loading and unloading areas, trash
areas, roadways, sidewalks, walkways, parkways, driveways,
landscaped areas, striping, bumpers, irrigation systems, common
area lighting facilities and fences and gates;
(bb) Trash disposal services;
(cc) Tenant directories;
(dd) Fire detection systems including sprinkler
system maintenance and repair;
(ee) Security services;
(ft) Any expense allocated to the Building for
the maintenance, repair, insurance or taxes
applicable to ▇▇▇▇▇▇▇▇▇ Park Drive or other
common areas of the ▇▇▇▇▇▇▇▇▇ Industrial Park;
(gg) Any other service to be provided by
Landlord that is elsewhere in this Lease stated
to be an "Operating Expense;"
(ii) The cost of water, gas and electricity to service
common areas in or around the Building;
(iii) The cost of any property and/or liability
insurance obtained by Landlord pursuant to Article 13
hereof.
(iv) The cost of real estate property taxes for the
building.
(c) The inclusion of the improvements, facilities and
services set forth in Section 4.2(b)(i) of the definition of
Operating Expenses shall not be deemed to impose an obligation
upon Landlord to either have said improvements or facilities or
to provide those services unless Landlord already provides the
services, or Landlord has agreed elsewhere in this Lease to
provide the same or some of them.
(d) Tenant's Share of Operating Expenses shall be payable
by Tenant within ten (10) days after a reasonably detailed
statement of actual expenses is presented to Tenant by Landlord.
At Landlord's option, however, an amount may be estimated by
Landlord from time to time of Tenant's Share of annual Operating
Expenses and the same shall be payable monthly orquarterly, as
Landlord shall designate, during each twelve-month period of the
Lease term, on the same day as the Base Rent is due hereunder. In
the event that Tenant pays Landlord's estimate of Tenant's Share
of Operating Expenses as aforesaid, Landlord shall deliver to
Tenant within sixty (60) days after the expiration of each
calendar year a reasonably detailed statement showing Tenant's
Share of the actual Operating Expenses incurred during the
preceding year. If Tenant's payments under this paragraph during
said preceding year exceed Tenant's share as indicated on said
statement, Tenant shall be entitled to credit the amount of such
overpayment against Tenant's Share of Operating Expenses next
falling due. If Tenant's payments under this paragraph during
said preceding year were less than Tenant's Share as indicted on
said statement, Tenant shall pay to Landlord the amount of the
deficiency within ten (10) days after delivery by Landlord to
Tenant of said statement.
4.3 Additional Rent. All obligations payable by Tenant under
the Lease other than Base Rent are called "Additional Rent" and
shall include but not be limited to the costs of any Tenant
Improvements to be paid by Tenant, over the allowance given by
the Landlord, excess Operating Expenses and actual costs
associated with the usage of HVAC system and lights other than
during ordinary business hours and Insurance and Taxes.
Additional Rent shall be paid monthly with Base Rent pursuant to
the Lease, unless otherwise invoiced by Landlord.
4.4 Interest Late Charges Costs and Attorneys' Fees. If Tenant
fails to pay within ten (10) days of the date due any Rents which
Tenant is obligated to pay under the Lease, the unpaid amount
shall bear interest at twelve (12%) percent per annum. Tenant
acknowledges that any late payments of Rents shall cause Landlord
to lose the use of that money and incur costs and expenses not
contemplated under the Lease, including without limitation
administrative, collection and accounting costs, the exact amount
of which is difficult to ascertain. Therefore, in addition to
interest, any late payments shall be accompanied by a payment of
a late charge equal to five (5%) percent of the late Rents.
Further, as Additional Rent, Tenant shall be liable to Landlord
for costs and attorneys fees incurred as a result of late
payments or non-payments. Acceptance of any interest, late
charge, costs or attorneys' fees shall not constitute a waiver of
any default by Tenant nor prevent Landlord from exercising any
other rights or remedies under the Lease or at law.
5. USE.
(a) The Premises shall be used for general office space and
any other lawful purpose incidental to Tenant's business, and no
other, unless consented to in writing by Landlord. Tenant shall
not do or permit to be done in or about the Premises or Building
anything which is prohibited by or in any way in conflict with
any and all laws, statutes, ordinances, rules and regulations now
in force or which may hereafter be enacted or promulgated or
which is prohibited by the standard form of fire insurance
policy, or which will increase the existing rate of or affect any
fire or other insurance upon the Premises or Building or any of
its contents, or cause a cancellation of any insurance policy
covering the Premises or Building or any part thereof or any of
its contents. Tenant shall not handle, use, store or otherwise
put any hazardous material on the Premises, without first
notifying Landlord of its intention to do so and identifying the
hazardous material and safety plan which shall ensure that any
such hazardous material is properly controlled, safeguarded, and
disposed of, and obtaining Landlord's prior written consent,
which consent may be reasonably withheld and may be conditioned
upon absolute indemnification by Tenant and accompanying bond.
Tenant shall not do or permit anything to be done in or about the
Premises or Building which will in any way violate Rules or
Regulations reasonably promulgated by Landlord throughout the
Lease, obstruct or interfere with the rights of other tenants, or
injure them, or use or allow the Premises or Building to be used
for any improper, immoral, or unlawful purpose, nor shall Tenant
cause, maintain or permit any nuisance, in, on or about the
Premises or Building or commit or suffer to be committed any
waste in, on or about the Premises or Building.
(b) Tenant shall not use the name of the Building in which
the Premises are located, in connection with any business carried
on in said Premises (except as Tenant's address) without written
consent of Landlord.
(c) Tenant shall not manufacture, assemble or store
materials inside the common areas outside of Building.
6. LANDLORD AND TENANT SERVICES.
(a) Landlord is responsible to maintain the Premises and
Building (including the roof and structure). All Operating
Expenses, including but not limited to repairs, maintenance,
sewer, garbage, insurance, taxes, property management, common
area utilities and common area janitorial, and other operating
expenses ("Operating Expenses") on the Premises, Building, and
common areas shall be coordinated by Landlord but are the
financial responsibility of the Tenant through prorated ▇▇▇▇▇▇▇▇.
Proration shall be on a square footage basis with all other
tenants and Tenant's proration shall be calculated by multiplying
the Operating Expenses by an equation, the numerator being the
Rentable square feet of the Premises and the denominator being
the total Rentable square feet of the Building. As soon as is
reasonably possible, but in any event within ninety (90) days
following the end of each calendar year, Landlord shall furnish
to Tenant a statement showing the Premises' and Building's actual
Operating Expenses for the preceding calendar year. In the case
of excess Operating Expenses, Tenant shall promptly remit its
prorata share of such excess to Landlord. Tenant may review at
his sole cost and expense any Operating Expenses prorated to
Tenant by Landlord, including assessed Real Estate Taxes as may
be statutorily allowed. Landlord shall make available the
applicable Operating Expenses' invoices and statements. However,
any such review must be requested and completed within sixty (60)
days of receipt of the annual statement.
(b) Tenant shall be responsible for the costs associated
with premises utilities, janitorial and usage of the HVAC and
lighting systems during times other than Ordinary Business Hours
as set forth in the Rules and Regulations including the costs of
installing and maintaining meters or other devices to record
after hour usage. Landlord may separately meter all utility usage
of Tenants premises.
7. ALTERATIONS.
(a) Tenant will not make or suffer to be made any
alterations, additions or improvements in excess of $1,000.00,
excluding the initial Tenant Improvements, (collectively
"Alterations") to or upon the Premises, Building, or any part
thereof, or attach any fixtures or equipment thereto, without
first obtaining Landlord's written approval, which shall not be
unreasonably withheld or delayed. Any Alterations to or upon the
Premises shall be made by Tenant at Tenant's sole cost and
expense and any contractor selected by Tenant to make the same
shall be subject to Landlord's reasonable prior written approval.
All such Alterations permanent in character, made in or upon the
Premises either by Tenant or Landlord, may at the option of
Landlord, become Landlord's property and, at the end of the term
or any extension hereof, shall remain on the Premises without
compensation to Tenant unless Landlord requests that Tenant
remove any such Alterations. Notwithstanding the above, Tenant's
work stations and other items of personal property shall remain
Tenant's property.
(b) Any Alterations shall, when completed, be of such a
character as not to lessen the value of the Premises or such
improvements as may be then located thereon. Any Alterations
shall be made promptly and in a good workmanlike manner and in
compliance with all applicable permits and authorizations and
building and zoning laws and with all other laws, ordinances,
orders, rules, regulations and requirements of all federal, state
and municipal governments, departments, commissions, boards and
offices. The costs of any such Alterations shall be paid by
Tenant, so that the Premises be free of liens, for services
performed, labor and material supplied or claimed to have been
supplied. Before any Alterations shall be commenced, Tenant shall
pay any increase in premiums on insurance policies (provided for
herein) or ensure adequate coverage is in place for all risks
related to the construction of such Alterations and the increased
value of the Premises.
8. LIENS.
Tenant shall keep the Premises and the Building free from
any mechanics' and/or materialmen's liens or other liens arising
out of any work performed, materials furnished or obligations
incurred by Tenant. Tenant shall notify Landlord in writing at
least seventy-two (72) hours before any work or activity is to
commence on the Premises which may give rise to such liens to
allow Landlord to post and keep posted on the Premises any
notices which Landlord may deem to be proper for the protection
of Landlord and the Premises from such liens.
9. DESTRUCTION OR DAMAGE.
(a) If the Premises is partially damaged by fire,
earthquake, or other Act of God, Landlord shall repair the same
at Landlord's expense, subject to the provisions of this Article
and provided such repairs can, in Landlord's reasonable opinion,
be made within sixty (60) days. During such repairs, the Lease
shall remain in full force and effect, except that if there shall
be damage to the Premises and such damage is not the result of
the negligence or willful misconduct of Tenant,Tenant1s
employees, agents, or invitees, an abatement of Rents shall be
allowed Tenant for such portion of Premises and period of time as
the Premises was unusable by Tenant.
(b) If in Landlord's reasonable opinion the partially
damaged Premises can be repaired, but not within sixty (60) days,
the Landlord may elect, upon written notice to Tenant within
thirty (30) days of such damages, to repair such damages over a
longer time period and continue the Lease in full force and
effect, but with Rents partially abated as provided in Article
9(a). In the event such repairs cannot be made within sixty (60)
days, Tenant shall have the option to terminate the Lease
provided that written notice is given to Landlord within thirty
(30) days of receipt of Landlord's notice stated in this
paragraph.
(c) If the partially damaged Premises is to be repaired
under this Article, Landlord shall repair such damages to the
Premises itself, and to the Tenant Improvements supplied by
Landlord herein. Except in the event of Landlord's gross
negligence or willful misconduct, Tenant shall be responsible.
for Tenant's equipment, furniture and fixtures, and other
alterations, additions and improvements made by Tenant to the
Premises and Building.
10. SUBROGATION.
Landlord and Tenant shall each, prior to Tenant's taking
possession or immediately after the execution of the Lease,
procure from each of the insurers under all policies of fire,
theft, public liability, workmen's compensation and other
insurance now or hereafter existing during the term and any
extension hereof and purchased by either of them insuring or
covering the Premises and/or Building or any portion thereof or
operations therein, a waiver of all rights of subrogation which
the insurer might otherwise, if at all, have against the other.
11. INDEMNIFICATION.
Tenant and Landlord hereby agree to indemnify and hold the
other party harmless from any damage to any property, including
the release of any hazardous materials, or injury to or death of
any person arising from the use of the Premises, Building, or
common areas by Tenant or the ownership, management or
maintenance of the Premises, Building, or common areas by
Landlord, except such as is caused by reason of the negligent or
willful act of the other party, its agents, employees or
contractors. The foregoing indemnity obligation of Tenant and
Landlord shall include reasonable fees, investigation costs and
all other reasonable costs and expenses incurred by Landlord or
Tenant from the first notice that any claim or demand is made,
except in the event of the other parry's negligence or willful
misconduct. The provisions of this Article shall survive the
Lease's termination with respect to any damage, injury or death
occurring prior to such termination.
12. COMPLIANCE WITH LEGAL REQUREMENTS.
Tenant shall, at its sole cost and expense, promptly comply
with all laws, statutes, ordinances and governmental rules,
regulations or requirements now in force or which may hereafter
by in force, the requirements of any board of fire underwriters
or other similar body now or hereafter constituted, any direction
or occupancy certificate issued pursuant to any law by any public
officer or officers, as well as the provisions of all recorded
documents affecting the Premises, (collectively the "Applicable
Laws"), insofar as any thereof relate to or affect the use or
occupancy of the Premises, Building, or common areas, excluding
requirements of structural changes now related to or affected by
improvements made by or for Tenant.
Landlord shall, at its sole cost and expense, promptly
comply with all Applicable Laws, including the American with
Disabilities Act ("ADA"), insofar as any thereof relate to or
affect Landlord's obligations under the Lease, or its ownership
of the Premises, Building, or common areas, except for Tenant's
requirements in the immediately preceding paragraph herein.
13. INSURANCE.
(a) Commercial General Liability. Tenant shall, maintain a
Commercial General Liability policy including all coverage's
normally provided therein. Such policies shall specifically name
Landlord as an additional insured, with a cancellation period of
thirty (30) days prior written notice of an cancellation. A
Certificate of Insurance shall be provided to Landlord. All
polices of insurance shall be issued by responsible insurance
companies licensed to do business in the State of Utah.
The minimum limits of coverage acceptable are:
(i) $1,000,000 Each Occurrence Combined Single Limit
for Bodily Injury and Property Damage
and
(ii) $2,000,000 Annual Aggregate
(b) Premises and Building Insurance. Landlord shall insure
the Premises and Building, including Landlord supplied Core and
Shell and Tenant Improvements as deemed necessary in Landlord's
reasonable discretion. Tenant shall pay its prorata share for
such insurance as outlined in Article 6 herein, involving
Tenant's prorated share of Operating Expenses. All policies of
insurance shall be issued by responsible insurance companies
licensed to do business in the State of Utah.
(c) Tenant's Additional Insurance. Tenant may, at its sole
cost and expense, cause all equipment, machinery, furniture and
fixtures, personal property, and Tenant Improvements supplied by
Tenant from time to time used or intended to be used in
connection with the operation and maintenance of the Premises, to
be insured by Tenant against loss or damage. Tenant may, at its
sole cost and expense, obtain appropriate business interruption
coverage. Except for losses caused by Landlord's gross negligence
or willful misconduct, Landlord is in no way liable for any
uninsured Tenant's property.
14. ASSIGNMENT AND SUBLETTING.
In the event Tenant should desire to assign the Lease or
sublet the Premises, Tenant shall give Landlord written notice of
such desire at least thirty five (35) days in advance of the date
on which Tenant desires to make such assignment or sublease.
Landlord shall then have a period of twenty-one (21) days
following receipt of such notice within which to notify Tenant in
writing that Landlord elects either (i) to terminate the Lease as
of the date so specified by Tenant, in which event Tenant will be
relieved of all further obligations hereunder, or (ii) to permit
Tenant to assign or sublet such space, subject to prior written
approval of the proposed assignee by Landlord, such consent not
to be unreasonably withheld or delayed, so long as the use of the
Premises by the proposed assignee would be a permitted use and
the proposed assignee is of sound financial condition at least
equal to Tenant as determined in Landlord's reasonable
discretion. Landlord may refuse to consent to any assignment or
subletting if Landlord believes that the new Tenant would have a
negative impact on the Premises or the Building's other tenants.
If Landlord should fail to notify Tenant in writing of such
election within said twenty-one (21) day period, Landlord shall
have deemed to have waived option (i) above, but written approval
by Landlord of the proposed assignee shall still be required.
Failure by Landlord to approve a proposed assignee shall not
cause a termination of the Lease. Any rents or other
consideration realized by Tenant under any such sublease and
assignment in excess of the Rents hereunder, after amortization
of the reasonable costs of extra tenant improvements for which
Tenant has paid and reasonable subletting and assignment costs,
shall at Landlord's option, (i) be paid ninety percent (90%) to
Landlord and ten percent (10%) to Tenant, or (ii) be paid to the
Tenant. No assignment or subletting by Tenant shall relieve
Tenant of any obligation under the Lease. Any assignment or
subletting which conflicts with the provisions hereof shall be
void.
15. RULES.
Tenant shall faithfully observe and comply with all Rules
and Regulations reasonably promulgated by Landlord, in writing
and after reasonable notice, during the Term or any Option period
herein. Landlord must apply rules equitably against all Tenants,
but shall not be responsible to Tenant for the non-performance by
other Building tenants, or adjacent buildings' tenants, of any of
said Rules and Regulations. A copy of the Rules and Regulations
are attached as Exhibit D.
16. ENTRY BY LANDLORD.
The Landlord may enter the Premises or Building at
reasonable hours, upon 24 hours notice to Tenant to (a) inspect
the same, (b) show the same to prospective purchasers, lenders or
tenants, (c) determine whether Tenant is complying with all of
Tenant's obligations hereunder, (d) post notices of non-
responsibility or (e) make repairs required of Landlord under the
Lease, repairs to adjoining space or utility service, or make
repairs, alterations or improvements to the Building, provided
that all such work shall be done as promptly as possible and with
as little interference to Tenant as reasonably possible. Tenant
hereby waives any claim for damages for any inconvenience to or
interference with Tenant's business, any loss of occupancy or
quiet enjoyment of the Premises occasioned by such entry.
Landlord shall at all times have and retain a key to unlock all
doors in, on or about the Premises (excluding Tenant's vaults,
safes and similar areas designated in writing by Tenant). In the
event of an emergency, Landlord shall have the right to use any
and all means which Landlord may deem proper to enter the
Premises, without notice, for the limited purpose of abating as
possible said emergency. Such emergency entrance shall not be
construed or deemed to be a forcible or unlawful entry into or a
detainer of the Premises or an eviction, actual or constructive,
of Tenant from the Premises, or any portion thereof.
17. EVENTS OF DEFAULT.
The occurrence of any one or more of the following events
("Events of Default") shall constitute a breach of the Lease by
Tenant: (a) if Tenant fails to pay Rents when and as the same
becomes due and payable and such failure continues for more than
ten (10) days after written notice thereof, or (b) if Tenant
fails to pay any other sum when and as the same becomes due and
payable and such failure continues for more than ten (10) days
after written notice thereof; or (c) if Tenant fails to perform
or observe any material term or condition of the Lease, such
failure continues for more than thirty (30) days after written
notice from Landlord, and Tenant does not within such period
begin with due diligence and dispatch the curing of such default,
or, having so began, thereafter fails or neglects to complete
with due diligence and dispatch the curing of such default; or
(d) if Tenant shall make a general assignment for the benefit of
creditors, or shall admit in writing its inability to pay its
debts as they become due or shall file a petition in bankruptcy,
or shall be adjudicated as bankrupt or insolvent, or shall file a
petition seeking any reorganization, arrangement, composition,
readjustment, liquidation, dissolution or similar relief under
any present or future statute, law or regulation, or shall file
any answer admitting or shall fail timely to contest the material
allegations of a petition filed against it in any such
proceeding, or shall seek or consent to or acquiesce in the
appointment of any trustee, receiver or liquidator of Tenant or
any material part of its properties; or (e) if within sixty (60)
days after the commencement of any proceeding against Tenant
seeking any reorganization, arrangement, composition,
readjustment, liquidation, dissolution or similar relief under
any present or future statute, law or regulation, such proceeding
shall not have been dismissed, or if; within sixty (60) days
after the appointment without the consent or acquiescence of
Tenant, of any trustee, receiver or liquidator of Tenant or of
any material part of its properties, such appointment shall not
have been vacated; or (f) vacation or abandonment of the Premises
for a continuous period in excess of fifteen (15) days after
initial occupancy, or (g) if the Lease or any estate of Tenant
hereunder shall be levied upon under any attachment or execution
and such attachment or execution is not vacated within thirty
(30) days of receipt thereof by Tenant.
18. TERMINATION UPON TENANT'S DEFAULT.
If an Event of Default shall occur, Landlord at any time
thereafter may give. a written
termination notice to Tenant, and on the date specified in such
notice (which shall not be less than three (3) days after
service) Tenant's right to possession shall terminate and the
Lease shall
terminate, unless on or before such date all Rents, arrearages
and other sums due by Tenant under the Lease, including
reasonable costs and attorneys' fees incurred by or on behalf of
Landlord, shall have been paid by Tenant and all other Events of
Default by Tenant shall have been fully cured to the satisfaction
of Landlord. Upon such termination, Landlord may recover from
Tenant:
(a) the worth at the time of award of the unpaid Rents
which had been earned at the time of termination; plus
(b) the worth at the time of award of the amount by which
the unpaid Rents which would have been earned after termination
until the time of award exceeds the amount of such Rents loss
that Tenant proves could have been reasonably avoided; plus
(c) the worth at the time of award of the amount by which
the unpaid Rents for the balance of the term of the Lease after
the time of award exceeds the amount of such Rents loss that
Tenant proves could be reasonably avoided; and plus
(d) any other amount reasonably necessary to compensate
Landlord for all the detriment proximately caused by Tenant's
failure to perform its obligations under the Lease or which in
the ordinary course of things would be likely to result
therefrom; and/or
(e) at Landlord's elections, such other amounts in addition
or in lieu of the foregoing as may be permitted from time to time
herein or by applicable law.
The "worth at the time of award" of the amounts referred to
in clauses (a) and ~) above is computed by allowing interest at
the rate of 10% per annum. The "worth at the time of award" of
the amount referred to in clause (c) above means the monthly sum
of the Rents under the Lease. Failure of Landlord to declare any
default immediately upon occurrence thereof, or delay in taking
any action in connection therewith, shall not waive such default,
but Landlord shall have the right to declare any such default at
any time thereafter.
19. CONTINUATION AFTER DEFAULT.
Even though Tenant has defaulted the Lease and abandoned the
Premises, the Lease shall continue in effect as long as Landlord
does not terminate Tenant's right to possession, and Landlord may
enforce all of its rights and remedies under the Lease, including
the right to recover the Rents as they become due under the
Lease. Acts of maintenance or preservation or efforts to relet
the Premises or the appointment of a receiver upon initiative of
Landlord to protect Landlord's interest under the Lease shall not
constitute a termination of Tenant's right to possession. If any
fixture, equipment, improvement, installation or appurtenance
shall be required to be removed from the Premises and/or Building
by Tenant, then Landlord (in addition to all other rights and
remedies) may, at its election by written notice to Tenant, deem
that the same has been abandoned by Tenant to Landlord, or
Landlord may remove and store the same and restore the Premises
to its original condition at the reasonable expense of Tenant, as
Additional Rent to be paid within ten (10) days after written
notice to Tenant of such expense.
20. LANDLORD'S DEFAULT.
If Landlord fails to perform or observe any of its material
Lease obligations herein and such failure continues for thirty
(30) days after written notice from Tenant, or such additional
time, if any, that is reasonably necessary to promptly and
diligently cure such failure after receiving written notice,
Landlord shall be in breach of the Lease (a "Default"). If
Landlord commits a Default, Tenant may pursue any remedies given
in the Lease or under law including terminating the lease and
seeking the return of any unused portion of the security deposit.
21. LANDLORD'S RIGHT TO CURE DEFAULTS.
All terms and provisions to be performed by Tenant under the
Lease shall be at Tenant's sole cost and expense and without any
abatement of Rents. If Tenant fails to pay any sum of money,
other than Rents, required hereunder or fails to perform any
other act required hereunder and such failure continues for
thirty (30) days after notice by Landlord, Landlord may, but
shall not be obligated, and without waiving or releasing Tenant
from any obligations of Tenant, make any such payment or perform
any such act on Tenant's part to be made or performed as provided
in the Lease. All sums paid by Landlord and all incidental costs
shall be deemed Additional Rent hereunder and shall be payable
within ten (10) days of written notice of such sums paid.
22. OTHER RELIEF.
Should any parry breach any of the covenants or agreements
made by that party herein, the parry committing the breach shall
pay all costs, expenses, expert witness fees, and reasonable
attorneys' fees which the other parry may incur in enforcing or
terminating this Lease, or in pursuing any other remedy provided
for hereunder or by applicable law, whether such remedy is
pursued by filing suit or otherwise, including, without
limitation, costs, expenses and fees incurred in successfully
defending against counterclaims or third parry claims and in any
successful appeals. In addition, should either parry hereto file
bankruptcy or be subject to involuntary bankruptcy proceedings,
that parry shall pay all costs, expenses, expert witness fees,
and reasonable attorneys fees incurred by other party hereto in
protecting its rights or remedies hereunder in said bankruptcy
proceeding.
The remedies provided for in the Lease are in addition to
any other remedies available to Landlord at law or in equity by
statute or otherwise.
23. ATTORNEYS' FEES.
Should either party breach any of the covenants or
agreements made by that party herein, the party committing the
breach shall pay all costs, expenses, expert witness fees, and
reasonable attorneys' fees which the other parry may incur in
enforcing or terminating this Lease, or in pursuing any other
remedy provided for hereunder or by applicable law, whether such
remedy is pursued by filing suit or otherwise, including, without
limitation, costs, expenses and fees incurred in successfully
defending against counterclaims or third party claims and in any
successful appeals. In addition, should either parry hereto file
bankruptcy or be subject to involuntary bankruptcy proceedings,
that parry shall pay all costs, expenses, expert witness fees,
and reasonable attorneys fees incurred by the other parry hereto
in protecting its rights or remedies hereunder in said bankruptcy
proceeding.
24. EMINENT DOMAIN.
If all or any part of the Premises shall be taken or
conveyed as a result of the exercise of the power of eminent
domain, the Lease shall terminate as to the part so taken as of
the date of taking, and, in the case of a partial taking, either
Landlord or Tenant shall have the right to terminate the Lease as
to the balance of the Premises by written notice to the other
within thirty (30) days after such date; provided, however, that
a condition to the exercise by Tenant of such right to terminate
shall be that the portion of the Premises taken or conveyed shall
be of such extent and nature as substantially to handicap, impede
or impair Tenant's use of the balance of the Premises. In the
event of any taking, Landlord shall be entitled to any and all
compensation, damages, income, rent awards or any interest
therein whatsoever which may be paid or made in connection
therewith, and Tenant shall have no claim against Landlord for
the value of any unexpired term of the Lease or otherwise,
provided that Tenant shall be entitled to any and all
compensation, damages, income, rent or awards paid for or on
account of Tenant's moving expenses, trade fixtures, equipment
and any leasehold improvements in the Premises, the cost of which
was borne by Tenant, to the extent of the then unamortized value
of such improvements for the remaining term of the Lease. In the
event of a taking of the Premises which does not result in a
termination of the Lease, the monthly rental herein shall be
apportioned as of the date of such taking so that thereafter the
rent to be paid by Tenant shall be in the ratio that the area of
the Premises not so taken bears to the total area of the Premises
prior to such taking.
25. SUBORDINATION, ATTORNMENT & NONDISTURBANCE; AND ESTOPPEL
CERTIFICATE.
At Landlord's request, Tenant agrees to execute,
acknowledge, and deliver within ten (10) days to Landlord a
Subordination, Attornment & Nondisturbance Agreement
("Subordination Agreement"), subject to Landlord's reasonably
proposed form(s). Such Subordination Agreement shall subordinate
the Lease to any ground lease, mortgage, deed of trust, or any
other hypothecation for security now or hereafter placed upon the
Premises, Building or common areas, or any part thereof, to any
and all advances made on the security, and to all renewals,
modification, consolidations, replacements and extensions
thereof, whether the Lease is dated prior or subsequent to the
date of said ground lease, mortgage, deed of trust or other
hypothecation or the date of recording thereof. Further, at
Landlord's request, Tenant agrees to execute, acknowledge, and
deliver within ten (10) days to Landlord an Estoppel Certificate,
subject to Landlord's reasonably proposed form(s). Such
Subordination Agreement and Estoppel Certificate may be relied
upon by any prospective purchaser, mortgagee, or beneficiary
under any ground lease, mortgage, deed of trust, or any other
hypothecation of the Premises, Building, or common areas, or any
part thereof. Notwithstanding such Subordination Agreement,
Tenant's right to quiet possession of the Premises shall not be
disturbed so long as Tenant is not in default under the Lease,
unless the Lease is otherwise terminated pursuant to its terms.
In the event that Tenant fails to execute, acknowledge, and
deliver to Landlord such Subordination Agreement and Estoppel
Certificate within ten (10) days of Landlord's request, the
parties herein expressly agree that Tenant shall be deemed in
default of the Lease without further notice. In such event, the
parties herein further expressly agree that the Subordination
Agreement and Estoppel Certificate are deemed to have been
executed by Tenant.
26. NOMERGER.
The voluntary Qr other surrender of the Lease by Tenant, or
a mutual cancellation thereof, shall not work a merger, and
shall, at the option of Landlord terminate all or any existing
subleases or subtenancies, or may, at the option of Landlord,
operate as an assignment to it of any or all such subleases or
subtenancies.
27. SALE.
In the event the original Landlord hereunder, or any
successor owner of the Premises, Building, and common areas shall
sell or convey the Premises, Building, and common areas, and the
purchaser assumes the obligations of Landlord under the Lease,
all liabilities and obligation on the part of the original
Landlord, or such successor owner, under the Lease accruing after
such Sale shall terminate, and thereupon all such liabilities and
obligations shall be binding upon the new owner. Tenant agrees to
attorn to such new owner.
28. NO LIGHT OR VIEW EASEMENT.
Any diminution or shutting off of light or view by any
structure erected on lands adjacent to the Building shall in no
way affect the Lease or impose any liability on Landlord.
29. HOLDING OVER.
If, without objection by Landlord, Tenant holds possession
of the Premises after expiration of the Term or any Option period
6f the Lease, Tenant shall become a tenant from month to month
upon the terms herein specified, but at a monthly Base Rent
equivalent to 125% of the Base Rent at the end of the term or
extension period pursuant to Article 4, payable in advance on or
before the 1st day of each month. All Additional Rent shall also
apply. Each party shall give the other notice at least one month
prior to the date of termination of such monthly tenancy of its
intention to terminate such tenancy.
30. ABANDONMENT.
If Tenant shall abandon or surrender the Premises, or be
dispossessed by process of law or otherwise, any personal
property belonging to Tenant and left on the Premises shall be
deemed to be abandoned, at the option of Landlord, except such
property as may be mortgaged to Landlord.
31. SECURITY DEPOSIT.
Tenant shall deposit with Landlord upon execution of the
Lease a security deposit in an amount equal to one month's Base
Rent during the last year of the Lease Term ("Security Deposit").
The Security Deposit shall be held by Landlord as security for
the faithful performance by Tenant of all of the provisions of
the Lease to be performed or observed by Tenant. In the event
Tenant fails to perform or observe any of the provisions of the
Lease to be performed or observed by it, then, at the option of
the Landlord, Landlord may (0ut shall not be obligated to do so)
apply the Security Deposit, or so much thereof as may be
necessary to remedy such default or to repair damages to the
Premises caused by Tenant. In the event Landlord applies any
portion of the Security Deposit to remedy any such default or to
repair damages to the Premises caused by Tenant, Tenant shall pay
to Landlord, within thirty (30) days after written demand for
such payment by Landlord, all monies necessary to restore the
Security Deposit up to the original amount. Any portions of the
Security Deposit remaining upon termination of the Lease shall be
returned.
32. WAIVER.
All waivers by either parry herein must be in writing and
signed by such parry. The waiver of any term or conditions herein
shall not be deemed to be a waiver of any subsequent breach of
the same or any other agreement, condition or provision herein
contained, nor shall any custom or practice which may grow upon
between the parties in the administration of the terms hereof be
construed to waive or to lessen the right of either parry to
insist upon the performance by the other parry in strict
accordance with said terms. The subsequent acceptance of Rents
hereunder by Landlord shall not be deemed to be a waiver of any
breach by Tenant of any term or condition of the Lease,
regardless of Landlord's knowledge of such breach at the time of
acceptance of such Rents.
33. NOTICES.
All notices and demands which may or are required to be
given by either parry to the other under the Lease shall be in
writing and shall be deemed to have been fully given when
deposited in the United States mail, certified or registered,
postage prepaid, and addressed as follows: to Tenant at ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, or to such other
place as Tenant may from time to time designate in a notice to
Landlord; to Prime Commercial Management, ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, Attn: ▇▇▇▇▇ ▇▇▇▇, or
to such other place as Landlord may from time to time designate
in a notice to Tenant, or in the case of Tenant, delivered to
Tenant at the Premises. Tenant hereby appoints as its agent to
receive the service of all dispossessory or distraint proceedings
and notices hereunder the person in charge of or occupying the
Premises at the time, and if no person shall be in charge of or
occupying the same, then service may be made by attaching same on
the main entrance of the Premises.
34. COMPLETE AGREEMENT.
There are no oral agreements between Landlord and Tenant
affecting the Lease, and the Lease supersedes and cancels any and
all previous negotiations, arrangements, brochures, agreements
and understandings, if any, between Landlord and Tenant with
respect to the subject matter of the Lease. The Lease may not be
altered, changed or amended, except by an instrument in writing
signed by both parties hereto.
35. AUTHORITY.
The person(s) executing the Lease on behalf of the parties
herein hereby covenants and warrants that (a) such party is a
duly authorized and validly existing entity under the laws in
which it was formed, (b) such parry has and is qualified to do
business in Utah, (c) such entity has full right and authority to
enter into the Lease, and (d) each person executing the Lease on
behalf of such entity is authorized to do so.
36. GUARANTEE OF LEASE.
Tenant guarantees, upon execution of the Lease, to occupy
the Premises. Any failure to occupy the Premises does not release
the Tenant from the obligation of paying Rents or any other terms
set forth herein.
37. MISCELLANEOUS.
(a) The words "Landlord" and "Tenant" as used herein shall
include the plural as well as the singular. If there be more than
one Tenant, the obligations hereunder imposed upon Tenant shall
be joint and several.
(b) Time is of the essence on the Lease and each and all of
its terms and conditions.
(c) The terms and conditions herein shall apply to and
bind the heirs, executors, administrators, successors and assigns
of the parties hereto.
(d) The captions of the Lease are solely to assist the
parties and are not a part of the terms or conditions of the
Lease.
(e) The Lease shall be governed by and construed in
accordance with the laws of the State of Utah, and is deemed to
be executed within the State of Utah.
38. SEVERABILITY.
If any term provision of the Lease, or the application
thereof to any person or circumstance, shall to any extent be
invalid or unenforceable, the remainder of the Lease, or the
application of such provision to persons or circumstances other
than those as to which it is invalid or unenforceable, shall not
be affected thereby, and each provision of the Lease shall be
valid and shall be enforceable to the extent permitted by law.
39. BROKERS.
Landlord is represented by ▇▇▇ ▇▇▇▇▇▇▇▇▇ and Tenant is
represented by ▇▇▇▇▇▇▇ ▇▇▇▇▇ of ▇▇▇▇▇▇▇▇ Banker Commercial.
Agreed-upon commissions shall be due and payable in two separate
payments. The first payment, consisting of 50% of the commission,
shall be due and payable upon execution of the lease. The-second
payment shall be due and payable upon occupancy of the space by
the tenant.
40. OPTION OF EXPANSION OR TERMINATION OF LEASE.
(a) Provided Tenant is not in default under the Lease,
Tenant shall, by written notice to Landlord no later than (180)
one hundred and eighty days prior to the Tenants expected date of
expansion, given written notification to Landlord of the
additional space requirement. Upon receipt of written notice
Landlord will try, to the best of his abilities, within reason,
to accommodate the needed expansion space either within ▇▇▇▇▇▇▇▇▇
Business Park or in another development owned by Landlord. In the
event the Landlord is successful in accommodating the expansion
space this lease, at the option of the Tenant, may be terminated
upon the Commencement Date of the new expansion lease.
(b) If the Landlord is unable to accommodate the
expansion space, Tenant may terminate this Lease but only after
the first anniversary of the Lease's commencement date. If the
Lease is terminated Tenant is required to pay Landlord the next
six months of rent, in a lump sum payment, at the time of
termination.
(c) Reimbursement for Portion of Commissions and
Tenant Improvement Costs. In the event that this Lease is
terminated prior to the end of the lease, Tenant shall reimburse
to Landlord the unamortized balance of the Tenant Improvement
Allowance and of any fees or commissions paid by Landlord to any
broker or agent in connection with this Lease plus interest
thereon at the rate of 10% per annum from Commencement Date of
this lease until the date paid. In calculating the unamortized
portion of said costs, it shall be assumed that they are
amortized over the Lease Term on a straight line basis. Payment
of the unamortized balance shall be due immediately upon
termination of this Lease.
IN WITNESS WHEREOF, the parties have executed the Lease
dated the day and year first above written.
TENANT, LANDLORD,
BUYERS UNITED INTERNATIONAL. ▇▇▇▇▇▇ LAND LIMITED
PARTNERSHIP NO.2
/s/ /s/