Lease - EsNet Properties LC and Caldera Inc.
LEASE AGREEMENT BETWEEN
EsNET PROPERTIES, L.C.,
A Utah limited liability Company, as
DATED
Landlord
and
CALDERA, INC.,
A Utah corporation, as
Tenant's
Dated 10/9/97
LEASE AGREEMENT
THIS LEASE AGREEMENT (this "LEASE") is entered as of the 10th day of October
1997, by, between and among EsNET PROPERTIES, L.C., a Utah limited liability
company, as LANDLORD, AND CALDERA, INC., a Utah corporation, as TENANT.
ARTICLE I: 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 II: PREMISES
Subject to the provisions of this Lease, Landlord hereby leases to
Tenant, and Tenant hereby leases from Landlord, the Building, which contains
16,960 square feet of Gross Floor Area (the "Premises"). In connection with such
demise, Landlord hereby grants to Tenant the non-exclusive right to use during
the Term all Common Areas designed for the use of all tenants in the Complex, in
common with all tenants in the Complex 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 III: TERM
The Term of this Lease shall commence on the Commencement Date and shall expire
at 5:00 p.m. on the fifth anniversary of the Commencement Date, unless extended
or earlier terminated as provided herein (the "TERM").
ARTICLE IV: USE
Tenant shall occupy and use the Premises solely for lawful, general
business office, sales, and product fulfillment purposes in connection with a
computer software development and distribution company, and otherwise in strict
compliance with the such rules and regulations for the entire Complex as may be
adopted from time to time by Landlord, 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.
ARTICLE V: RENT
<PAGE> 2
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:
<TABLE>
<CAPTION>
MONTHLY ANNUAL
TERM AMOUNT AMOUNT
---- ---------- -----------
<S> <C> <C>
Year 1 $17,101.33 $205,216.00
Year2 $17,614.37 $211,372.48
Year 3 $18,142.80 $217,713.65
Year 4 $18,687.09 $224,245.06
Year 5 $19,247.70 $230,972.42
</TABLE>
5.2 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
address recited in Section 26.7, 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
5.3 DELINQUENT PAYMENTS AND HANDLING CHARGE. All Rent, if not paid
within five (5) days after the date due, shall bear interest from and after the
fifth day after being due until paid and all other payments required of Tenant
hereunder shall bear interest from the date due until the date paid at the rate
of interest specified in Section 26.13. In addition to interest, if any such
Rent or other payment is not received within ten (10) days from the date it is
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 5.3 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.
5.4 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 XMV 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
paid in full all amounts payable by Tenant 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, and 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
terminations shall immediately inure to the benefit of Landlord ac partial
compensation for the costs and expenses incurred by Landlord in connection with
this Lease.
ARTICLE VI: 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 COMMENCEMENT 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 Commencement Date (and such entry alone shall not constitute Tenant's
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 Commencement Date shall conduct itself so
as to not interfere with Landlord or other occupants of the Complex. Landlord
may withdraw any permission granted under this Section 6.2 upon twenty-four (24)
hours' notice to Tenant 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 or
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 result of any prior entry.
<PAGE> 3
6.3 COMMENCEMENT DATE: ADJUSTMENTS TO COMMENCEMENT DATE. For purposes of
this Lease, the "COMMENCEMENT DATE" shall mean 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 Tenant 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 (iii) any other
action or inaction of Tenant, or any person or firm employed or retained by
Tenant, or (c) the date on which Tenant takes possession of the Premises. If by
the scheduled Commencement Date specified in Section 3, the Landlord's Work has
not been substantially completed, and such failure to substantially complete
renders the Premises unsuitable for the commencement of Tenant's business on the
Premises as reasonably determined by Landlord and Tenant, then the Commencement
Date (and the commencement of payment of Base Rent and Additional Rent) shall be
postponed until the Landlord's Work is substantially completed as reasonably
determined by Landlord and Tenant 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 equal 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 VII: UTILITIES AND SERVICE TO BE FURNISHED BY LANDLORD
7.1 UTILITIES. Tenant shall be solely responsible for, and pay when due,
all charges for all utilities supplied to or used in the Premises other than
water, including, but not limited to, gas, heat, light, power, telephone, and
other utilities or services used by or supplied to Tenant or to the Premises,
together with any taxes thereon, during the term of this Lease.
7.2 SERVICES PROVIDED BY LANDLORD. 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
water at those points of supply common to the entire Premises for lavatory and
drinking purposes only. If water service or other services provided by Landlord
pursuant to other provisions of 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,
except in cases of gross negligence by Landlord, or be construed as an eviction
of Tenant, or work an abatement of Rent or relive Tenant from fulfilling any of
its other obligations hereunder. If not previously installed, Landlord may cause
a water meter to be installed in the Premises in order to measure the amount of
water consumed for any such use.
7.3 KEYS. Landlord shall furnish Tenant, at Landlord's expense, with two
keys, and at Tenant's expense with such additional keys as Tenant may request,
to unlock each exterior door entering the Premises. Tenant may, at Tenant's
expense and subject to the provisions of this Section 7.3 and Article XI,
install a card-key access system. Landlord shall, however, be entitled at all
times to possession of a duplicate of all keys and/or access cards to all
exterior doors to the Premises. All keys and/or access cards referred to in this
Section 7.3 shall constitute the property of the Landlord. Upon the expiration
or termination of the Term, Tenant shall surrender to Landlord all keys and/or
access cards to all exterior and interior doors to the Premises 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 on or about the exterior of the Premises
and the Complex which monitor, by closed circuit television or otherwise, all
persons leaving or entering the Complex and the Premises.
7.4 TENANT IDENTITY. Subject to the provisions of Article XI and this
7.4 and subject to Tenant's complying, at Tenant's expense with all applicable
Legal Requirements, Tenant shall have the right to install, at Tenant's expense,
a monument sign advertising Tenant's location in the Complex at a location in
the Common Areas of the Complex reasonably acceptable to Landlord. 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 Tenant, 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 OPERATING HOURS. Subject to such rules and regulations regarding the
use of the Common Areas as Landlord may from time to time adopt, the Complex
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 VIII: REPAIR AND MAINTENANCE
8.1 BY LANDLORD. Landlord shall maintain the structural components of
the Building, the roof of the Building, elevator, HVAC System and other Major
Equipment ~ a~ the roof of the Building 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 Section XlV 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.
8.2 BY TENANT. Except as provided otherwise in Section 8.1 above,
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, windows, doors, and locks, furnishings, trade fixtures,
signage, leasehold improvements, equipment and other personal
<PAGE> 4
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 Landlord's
direction and supervision, any damage to the Building and/or the Complex
(including the structural components and the roof of the Building) caused by
Tenant or Tenant's 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 this
Section) pursuant to this Section 8.2 or Article XI shall be approved by
Landlord prior to the commencement of any such work.
8.3 HAZARDOUS SUBSTANCES. Tenant (a) shall at all times comply with, or
cause to be complied with, any "Environmental Law" governing the Premises or the
use thereof by Tenant or any of Tenant's employees, agents, contractors,
invitees, licensees, customers, or clients, (b) shall not use, store, generate,
treat, transport, or dispose of, or permit any of Tenant's employees, agents,
contractors, invitees, licensees, customers, or clients to use, store, generate,
treat, transport, or dispose of, any "Hazardous Substance" on the Premises
without first obtaining Lessor's written approval, (c) shall promptly and
completely respond to and cleanup any release or presence of any Hazardous
Substances upon the Premises in accordance with applicable laws and regulations
and (d) shall pay all costs incurred as a result of the environmental state,
condition and quality of the Premises, including, but not limited to, the costs
of any Environmental Cleanup Work (hereinafter defined) and the preparation of
any closure or other required plans (all of the foregoing obligations of Tenant
under this Section 8.3 are hereinafter collectively "Tenant's Environmental
Obligations"). Tenant shall indemnify, defend and hold Landlord harmless from
and against any and all claims, actions, damages, penalties, fines, liabilities
and expenses, including reasonable attorneys' fees, which are directly or
indirectly, in whole or in part, caused by or arise out of Tenant's
Environmental Obligations. Tenant shall promptly deliver to Landlord true and
complete copies of any and all notices or correspondence or request from any
governmental authority or third parties relating to the presence, release, use,
storage, treatment, transportation, or disposal of Hazardous Substances, which
notices, correspondence, or requests relate, in any way, to the Premises. Tenant
shall permit Landlord and Landlord's agents to enter into and upon the Premises,
without notice, at all reasonable times for the purpose of inspecting the
Premises and verifying Tenant's compliance with these covenants. The provisions
of this Section 8.3 shall survive the expiration or other termination of this
Lease.
ARTICLE IX: TAXES ON TENANT'S PROPERTY
Tenant shall be liable for and shall pay, before they become delinquent,
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 IX
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 X: TRANSFER BY TENANT.
10.1 GENERAL. Without the prior written consent of Landlord, which
consent shall not be unreasonably withheld, 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 whether
Landlord elects (a) to refuse to consent to the Transfer and to terminate this
Lease as to the space proposed to be Transferred as of the 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 l 0.1(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 hereunder, but such collection and
application shall not constitute a waiver of the provisions 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 Lease, 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 agrees to use and occupy the Transferred space solely
for the purpose specified in Article IV and otherwise in strict accordance with
this Lease, and (3) 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).
<PAGE> 5
(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.
ARTICLE XI: 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 permits and licenses, (c) is made with prior written
consent of Landlord, (d) is made pursuant to plans and specifications 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
liens 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 Landlord's election, be (1) surrendered with the Premises as part
thereof at the termination or expiration of the Term, without any payment,
reimbursement or compensation therefore, 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, claims, damages,
losses, liabilities and expenses, including attorneys' fees, which may arise out
of, or be connected in any 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 XII: 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 Complex, (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 Complex, 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
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
structural integrity of the Building in any way, or (e) commit 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 extended 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
therefore by Landlord.
ARTICLE XIII: ACCESS BY LANDLORD
Except as provided below in this Article XIII, 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, maintain, repair, replace or alter the
Premises, (b) to show the Premises to prospective purchasers (or, during the
last twelve (12) months of the Term, to prospective tenants), (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 therefore. Entry into the Premises by Landlord or any
other person or firm named in the first sentence of this Article XIII 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 Tenant's business, for loss
of occupancy or quiet enjoyment, or for consequential damages. Notwithstanding
anything to the contrary in this Article XIII, Tenant may designate certain
areas of the Premises as "Secured Areas" should Tenant require such areas for
the purpose of securing certain valuable property or confidential information.
Landlord may not enter Secured Areas without providing Tenant with forty-eight
(48) hours' prior written notice of the specific date and time of entry by
Landlord.
ARTICLE XIV: CONDEMNATION
If all of the Premises is taken, or if so much of the Premises is Taken
that, in Landlord's opinion, the remainder cannot be restored to an economically
viable, quality office building, or if the awards payable to Landlord as a
result of any Taking are, in Landlord's opinion, inadequate to restore the
remainder to an economically viable,
<PAGE> 6
quality office building, Landlord may, at its election, exercisable 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 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 XIV, 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 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 Tenant's moving and relocation
expenses, and depreciation to and 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 XV: 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
Premises are partially destroyed but in Landlord's opinion they cannot be
restored to an economically viable, quality office building complex, 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 shall be abated to the extent the Premises
are rendered untenantable and, after the period of restoration, Base Rent 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, and except in cases of gross
negligence on the part of Landlord, Tenant shall have no claim against Landlord
for any loss suffered 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. The proceeds of all insurance carried by Tenant
on Tenant's 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, partners, employees, contractors, agents,
invitees or representatives, (a) Tenant's obligation to pay Rent and to perform
its other obligations under this Lease shall 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 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 Landlord's Mortgagee.
ARTICLE XVI: 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 this
Lease, and the aforesaid leasehold estate and rights, titles and interests,
superior to any Mortgage. Upon the written request by Landlord or 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 Landlord'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 XVI 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
<PAGE> 7
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 the needs or requirements of any lender that is
considering making or that has made a loan secured by all or any portion of the
Complex.
ARTICLE XVII: INSURANCE.
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 injury and property damage of not less than One Million Dollars
($1,000,000) per occurrence, including, without limitation, contractual
liability coverage for the performance by Tenant of the indemnity agreements set
forth in Article XVIII.
(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 replacement 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 worker's 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 Complex.
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:X1I in the most
recent issue of Best's Key Rating Guide. Propertv-Casualty. All liability
policies 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.
Tenant 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, not contributing with
and not in excess of the coverage which Landlord may carry, and shall 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 ventures, employees, agents, customers, invitees
or business visitors of each other, or of any other tenant or occupant of the
Complex, 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 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's 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 willful 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 XVIII: TENANT'S INDEMNITY
Subject to Section 17.2, Tenant shall defend, indemnify 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
injures to or death of any person or damage to any property occurring during the
Term in the Premises, on the Complex, and/or in the Common Areas.
<PAGE> 8
ARTICLE XIX: 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,
except, with respect to both (d) and (e) in the case of gross negligence by
Landlord.
ARTICLE XX: 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 adopt and/or modify rules and regulations
regarding the use thereof
ARTICLE XXI: 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 XXII: DEFAULT BY TENANT.
22.1 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 five (5) days after written notice
from Landlord to Tenant specifying the failure; provided, however, after
Landlord has seven Tenant written notice pursuant to this Section 22.1(a) on two
separate occasions, Landlord shall not be required to give Tenant any further
notice under this Section 22.1(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 term "Tenant"
also meaning, for the purpose of this Section 22.1 (d), any guarantor of the
named Tenant's obligations hereunder) (1) in any bankruptcy or other 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.
22.2 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 an 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 ~is 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 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 amounts 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 Lease for such previous default by giving written notice thereof to Tenant.
<PAGE> 9
(b) Terminate Tenant's right to possession by notice to Tenant, in which
case this Lease shall terminate and Tenant shall immediately surrender
possession of the Premises to Landlord. In such event Landlord shall be entitled
to recover from Tenant all damages incurred by Landlord by reason of Tenant's
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. Upon any such re-entry Landlord shall have the right to make
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 22.1 (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.
22.3 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 obtaining
possession of the Premises, (b) removing and storing Tenant's or an other
occupant's property, (c) repairing, restoring, altering, remodeling or otherwise
puking 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.
22.4 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 Term, 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 Complex. 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.
22.5 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 purpose.
22.6 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 an other 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.
ARTICLE XXIII: 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 giving the name and address of
Landlord's Mortgagee) Landlord's Mortgagee written notice thereof specifying,
with reasonable particularity, the nature of Landlord's 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 judgment shall be limited to Tenant's actual direct, but no
consequential, damages therefore 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 XXIV: RIGHT OF RE-ENTRY
<PAGE> 10
24.1 SURRENDER OF PREMISES. Upon the expiration or termination of the
Term for whatever cause, or upon the exercise by Landlord of its right to
re-enter 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 a lien on such personal property, trade fixtures and other
property as set forth in Section 38-3-1, et ~9,., of the Utah Code Ann. (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 shall not be
released from Tenant's obligations under this Lease in connection 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.
24.2 HAZARDOUS SUBSTANCES. No spill, deposit, emission, leakage or other
release of Hazardous Substance in the soils, groundwaters or waters shall be
deemed to result in either (a) wear and tear that would be normal for the term
of the Lease; or (b) a casualty to the Premises. Tenant shall be responsible to
promptly and completely cleanup any such release as shall occur on the Premises
during the term of the Lease and shall surrender the Premises free of any
contamination or other damage caused by such occurrence during the term of the
Lease. Tenant's obligation to cleanup the Premises pursuant to the provisions of
this Article XMV shall survive the expiration or other termination of this
Lease.
ARTICLE XXV: TENANT'S RIGHT TO TERMINATE LEASE
Subject to the provisions of this Article XXV and provided that no Event
of Default has occurred and is then continuing and no event has occurred and is
then continuing which, with the giving of notice or lapse of time, or both,
would become an Event of Default, Tenant shall have the option exercisable at
any time after the third anniversary of the Commencement Date to terminate this
Lease and Tenant's rights in and to the Premises (hereinafter the "Termination
Option"). The Termination Option shall only be exercisable by (a) Tenant giving
Landlord at least one hundred and eighty (180) days prior written notice of (1)
Tenant's intention to exercise the Termination Option and (2) the date on which
the Lease and Tenant's rights in and to the Premises are to terminate
(hereinafter the "Termination Date") and (b) Tenant paying to Landlord
concurrently with the giving of such notice, in cash or other immediately
available funds, an amount equal to the unamortized cost of Landlord's Work as
of the Termination Date. For purposes of this Article XXV, the unamortized cost
of Landlord's Work shall be determined by amortizing the total cost of
Landlord's Work on a straight line basis over a term of five years, with such
five year period commencing on the Commencement Date. The total cost of
Landlord's Work shall be equal to the sum of the Construction Allowance and the
Excess Tenant Improvement Costs.
ARTICLE XXVI: GENERAL PROVISIONS
26.1 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, unless a default by Landlord hereunder remains uncured for
longer than sixty (60) days after written notice of such default from Tenant to
Landlord.
26.2 TIME OF ESSENCE. Time is of the essence with respect to each date
or time specified in this Lease by which an event is to occur.
26.3 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
26.4 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.
26.5 ESTOPPEL CERTIFICATES: FINANCIAL STATEMENTS. Tenant shall, from
time to time and within ten (10) days of written request from either Landlord or
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 expiration date; (c)
that this Lease is in full 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 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
<PAGE> 11
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 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; 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 (10) 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.
26.6 SIGNS. COMPLEX 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 Complex for any purpose other than as the address of the
building for the business to be conducted by Tenant from the Premises
26.7 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 26.7, 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 Complex manager's office at the Complex, 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 26.7.
26.8 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 26.8 shall not
negate, diminish or alter the restrictions on Transfer applicable to Tenant set
forth elsewhere in this Lease 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 26.8 shall not
negate, diminish or alter the restrictions on Transfer applicable to Tenant set
forth elsewhere in this Lease.
26.9 SEVERABILITY. This Lease is intended 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 invalidity 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.
26.10 NUMBER AND GENDER. CAPTIONS AND REFERENCES. As the context of this
Lease may require, pronouns shall include natural 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. Whenever 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.
26.11 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 attorneys" 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 judgment 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 proceeding or contested matter, or an other actions taken by the
non-bankrupt 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).
26.12 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 Cottonwood Realty, which payment shall by paid by Landlord. Each party
shall defend, indemnify and hold the other harmless from 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.
26.14 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 perform this Lease,
(c) the person executing this Lease on
<PAGE> 12
behalf of Tenant was authorized to do so, 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.
26.15 RECORDING. Neither this Lease (including any Exhibit hereto) nor
any memorandum hereto shall be recorded without the prior written consent of
Landlord.
26.16 RENEWAL OPTION. Tenant shall have the right to renew the Term of
the Lease for an additional period of thirty-six months in accordance with the
provisions of Exhibit D attached hereto and by this reference made a part
hereof.
26.17 RIGHT OF FIRST REFUSAL.. Tenant shall have a right of first
refusal with respect to other space located in the Complex in accordance with
the provisions of Exhibit E attached hereto and by this reference made a part
hereof.
26.18 EXHIBITS. All Exhibits and written addenda hereto are incorporated
herein for any and all purposes.
26.19 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
26.20 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.
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 EXPRESS OR IMPLED, AND LANDLORD AND TENANT
EXPRESSLY DISCLAIM ANY IMPLIED WARRANTY THAT THE PREMISES ARE SUITABLE FOR
TENANT'S INTENDED COMMERCIAL PURPOSE, AND TENANT'S OBLIGATION TO PAY RENT
HEREUNDER IS NOT DEPENDENT UPON THE CONDITION OF THE PREMISES FOR 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.
TENANT: CALDERA, INC.
BY: /s/ Douglas S. Cooper
--------------------------------------
TITLE: Controller
--------------------------------------
NAME: Douglas S. Cooper
--------------------------------------
DATE: October 9, 1997
--------------------------------------
ADDRESS: 633 South 550 East, Provo, Utah 84606
--------------------------------------
LANDLORD: ESNET PROPERTIES, L.C., a Utah
limited liability company
BY: /s/ Daniel W. Campbell
--------------------------------------
TITLE: Managing Member
--------------------------------------
NAME: Daniel W. Campbell
--------------------------------------
DATE: October 10, 1997
--------------------------------------
<PAGE> 13
ADDRESS: 5152 North Edgewood Drive, Suite 350 Provo, Utah 84604
----------------------------------------------------------