TRIPLE NET LEASE AGREEMENT
THIS LEASE AGREEMENT (the "Lease") is entered into this 1st day of
January, 2000 by and among K.E.B. Enterprises, L.P., a Utah limited partnership,
located at 000 Xxxx Xxxxxx, Xxxx, Xxxx 00000 ("Lessor") and SENTO CORPORATION, a
Utah corporation, located at 000 Xxxx Xxxx Xxxxxx Xxxxx, Xxxxxxxx Xxxx, Xxxx
00000 ("Lessee").
1. LEASED PREMISES. The Lessor hereby leases to the Lessee and
the Lessee hereby leases from the Lessor those certain premises (the "Leased
Premises") known as the Pamida Building, located at 000 Xxxxxx Xxxxx Xx.,
Xxxxxxxx, Xxxxxxx. The Leased Premises are comprised of 33,000 square feet of
rentable commercial space.
2. LEASEHOLD IMPROVEMENTS. In preparing the Leased Premises for
occupancy by the Lessee, the Lessee shall be responsible for all interior tenant
improvement cost and exterior improvement cost. In particular, Tenant shall be
responsible for all costs associated with or incurred in connection with
installation of wire and cable for data, telephone and power transmission.
Tenant shall also be responsible for construction of any upgrades to the HAVC
system. All tenant improvements shall be approved in writing by the Lessor,
which approval shall not be unreasonably withheld. Lessor has approved in
concept Lessee's intention to lower the ceiling, install windows and skylights,
and to install new flooring and paint to the Leased Premises; however, Lessor
specifically reserves the right to review constructions and plans for such
improvements prior to granting or withholding approval.
3. LEASE TERM. The initial Term of this Lease is sixty six (66)
months commencing upon the execution of this Lease ("Commencement Date"). The
Term of the Lease, unless renewed pursuant to Section 5 below, or terminated
earlier in accordance with the terms hereof, shall expire on the last day of
the 66th month hereafter.
a. DELIVERING POSSESSION. Lessor shall deliver possession and
Lessee agrees that if the Lessor for any reason is unable to deliver
possession of the Leased Premises to the Lessee on the Commencement
Date set forth above, the Lessor shall not be liable for any damage
thereby nor shall such inability effect the validity of the Lease or
the obligations of the Lessee hereunder, but in such case the Lessee
shall not be obligated to pay rent or other monetary sums until
possession of the Leased Premises is tendered to the Lessee; provided
that if the delay in delivery of possession exceeds fifteen days (15),
then Lessee shall have the election to terminate this Agreement
without penalty, and Lessor shall return to Lessee any deposits made
hereunder. In the event Lessee elects to continue with the Lease
Agreement if the delay in delivery exceeds thirty (30) days, then the
expiration date of the Term of the Lease shall be extended to 66
months following the date possession is tendered.
b. CANCELLATION CONTINGENCY. Nothwithstanding the foregoing
provisions or anything to the contrary herein, Tenant shall have the
absolute right to cancel the lease
without penalty or payment prior to the expiration of one hundred
eighty (180) days following the Commencement Date if, and only if, the
City of Evanston, Wyoming or the State of Wyoming should fail to
finalize a low interest loan agreement with Lessee. In the event
Lessee exercises its right to cancel the lease hereunder, any and all
improvements made by Lessee on the Leased Premises shall remain with
the real property of the Leased Premises, without cost or obligation
to the Lessor, and shall become the property of the Lessor.
4. RENEWAL. Upon expiration of the Term hereof, Lessor hereby
grants to Lessee and Lessee acknowledges and accepts the automatic renewal of
this Lease for an additional two (2) year period under the terms and
conditions as herein set forth except that rent during the renewal period
shall be adjusted and increased to $4.50 per rentable square foot. This
adjustment shall be made on the first day of the first month of each renewal
period and shall apply throughout the renewal period. Lessee may give written
notice to Lessor no later than ninety (90) days prior to the expiration of
the initial Term hereof if Lessee does not want to renew the Lease following
the expiration of the initial Term.. In the absence of such written notice,
Lessee shall be bound for an additional two year term.
Upon expiration of the two year renewal term, Lessor hereby grants to
Lessee and Lessee acknowledges and accepts the automatic renewal of this Lease
for an additional two (2) year period under the terms and conditions of the
first two year renewal term, as herein set forth. Lessee may give written notice
to Lessor no later than ninety (90) days prior to the expiration of the first
two year renewal term if Lessee does not want to renew the Lease following the
expiration of the first two year renewal term. In the absence of such written
notice, Lessee shall be bound for an additional two year term.
5. RENT. Rent shall be computed and paid as follows:
a. RENT DURING INITIAL TERM. Commencing 180 days after the
Commencement Date, and during the balance of the initial Term of the
Lease, Lessee shall pay rent to Lessor calculated at the rate of $3.50
per rentable square foot per year. Rent shall be payable in equal
monthly installments of Nine Thousand Six Hundred Twenty Five Dollars
($9,625.00) in advance on the first day of each month without
deduction, set off or counter claim for each month of the initial
term.
b. RENT DURING EXTENDED TERM(S). During any extended term of
this Lease, following the expiration of the initial Term, the Lessee
shall pay rent to the Lessor calculated at the rate of $4.50 per
rentable square foot per year. Rent shall be payable in equal monthly
installments of Twelve Thousand Three Hundred Seventy Five Dollars
($12,375.00) in advance on the first day of each month without
deduction, set off or counter claim for each month of any renewal
term.
c. HOLDOVER TERM. In the event Lessee becomes a holdover
tenant following the
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expiration of the initial Term or any renewal term hereunder, the rent
shall be Twelve Thousand Three Hundred Seventy Five Dollars
($12,375.00) per month during each month of the holdover period.
d. DEPOSIT. Upon execution of this Agreement, Lessee shall
pay the sum of Five Thousand Dollars ($5,000.00) as a deposit for
repair of any damages caused by Lessee during the initial Term or any
renewal term hereof. Said damage deposit shall be paid directly to
Lessor and held by Lessor during any such term hereof.
e. PAYMENT. After the damage deposit is paid, rents shall be
paid monthly in advance of the first day of the month in accordance
with the terms hereof (commencing 180 days following the Commencement
Date), at a place designated by the Lessor and herein stated. If any
rental payment due on the first of any month has not been paid in full
on or before the tenth (10th) day of the month, the Lessee shall pay a
late fee of ten percent (10%) of the then due rental payment. In the
event rent plus the late fee are not paid by the twentieth (20th) day
of the month, the rent due plus the late fee will incur interest at
eighteen percent (18%) per annum until paid in full.
6. USE OF LEASED PREMISES. The Lessee agrees to use the Leased
Premises for any lawful purposes, consistent with the local zoning ordinances.
Lessee shall undertake reasonable efforts to prevent any illegal activities from
occurring at or in the Leased Premises.
7. TRIPLE NET LEASE. This Lease is a triple net Lease. Lessee
shall pay all costs associated with or arising in connection with Lessee's
occupancy of the Lease, including without limitation, the following costs,
charges and assessments:
a. UTILITIES. Lessee shall pay, when due, all gas, water,
sanitary sewer, electricity, telephone and other utilities used and
consumed by Lessee with regard to the Leased Premises and shall hold
Lessor harmless therefrom.
b. TAXES AND ASSESSMENTS. Lessee shall pay all real property
taxes and assessments on the Leased Premises when due and payable.
Lessor shall deliver or provide to Lessee all notices of taxes or
assessments pertaining to the Leased Premises. Any personal property
taxes assessed on personal property belonging to the Lessee or on any
fixtures, improvements, or equipment in the Leased Premises, including
upon the Lessee's leasehold interest, shall be the responsibility of
the Lessee, who agrees to pay the personal property taxes when due and
payable. Lessee shall be entitled to take tax deductions for all such
taxes paid by Lessee. Lessor shall not claim any deductions for taxes
paid by Lessee hereunder.
8. INSURANCE AND INDEMNIFICATION.
a. LESSEE'S OBLIGATION. Lessee, at Lessee's sole cost and
expense, shall obtain
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and maintain in effect throughout the term hereof insurance policies providing
the following coverage:
(1) During the term of this Lease, Lessee shall pay for and
maintain all risk property insurance against fire, theft, vandalism,
malicious mischief, sprinkler leakage and such additional perils as now
are or hereafter may be included in a standard extended coverage
endorsement from time to time in general use in the State of Utah, in
such amounts and coverages and with such special endorsements as Lessor
shall reasonably determine are necessary from time to time, insuring
the Leased Premises,
(2) All risk property insurance insuring Lessee's merchandise,
trade fixtures, furnishings, equipment and all items of personal
property of Lessee located on or in the Leased Premises,
(3) A comprehensive general liability policy naming K.E.B.
Enterprises, L.P. and all Mortgagees of the Leased Premises as
additional insureds, protecting against any and all claims for injury
to persons or property occurring in or about the Leased Premises and
protecting against assumed or contractual liability under this Lease
with respect to the Leased Premises and the operations in, on or about
the Leased Premises with such policy to be in the minimum amount of
$1,000,000 single limit coverage,
(4) Workers' compensation coverage as required by law,
(5) With respect to alterations, improvements and the like
required or permitted to be made by Lessee hereunder, contingent
liability and builders' risk insurance in amounts satisfactory to
Lessor.
All insurance policies herein to be procured by Lessee shall:
(1) Be issued by insurance companies reasonably satisfactory
to Lessor and authorized to do business in the State of Wyoming,
(2) Be written as primary policy coverage and non-contributing
with respect to any coverage that Lessor may carry,
(3) Insure and name Lessor as an additional insured, as their
respective interests may appear (except with respect to workers'
compensation insurance) and,
(4) Contain an express waiver of any right of subrogation by
the insurance company against Lessor and its agents, employees and
representatives.
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b. MUTUAL INDEMNIFICATION. Lessee and Lessor agree tomutually
indemnify and hold one another harmless from any and all claims,
losses, liability, damages, or expenses (including reasonable
attorney's fees) arising out of the use of the Leased Premises, where
such claim or damage is caused by the negligence or misconduct of the
Lessee, on the one hand, or Lessor, on the other hand, or any agent,
employee, or invitee of such parties, or where such injury or damage
is the direct result of the Lessee's violation of any applicable law,
ordinance, or regulation of any governmental entity, except for
liability directly caused by Lessee, on the one hand, or Lessor, on
the other hand.
9. ALTERATIONS. The Lessee will not make or allow to be made any
alterations, additions, or improvements to the Leased Premises without the
Lessor's prior written consent, which shall not be unreasonably withheld. The
Lessor will have the right to approve the materials used and the manner of
making any alteration, addition, or improvement and cause them to be made in a
good workmanlike manner, consistent with the quality, style, and design of the
Leased Premises, which right of approval shall not be unreasonably withheld. Any
alteration, addition, or improvement approved by the Lessor will be made at the
Lessee's sole expense, including but not limited to any partitions, counters,
shelving, fixtures, fittings, machinery, and equipment.
The Lessee shall keep the Leased Premises and the Building free from
any liens arising out of work performed, materials furnished, or obligations
incurred by the Lessee and shall indemnify, hold harmless and defend the Lessor
from any liens and encumbrances arising out of any work performed or materials
furnished by or at the direction of the Lessee.
At any time before the expiration or earlier termination of this Lease,
the Lessee may remove such of the alterations, additions, or improvements as
will not damage the Leased Premises or which can be restored at the Lessee's
expense, and may remove any equipment and other personal property of the Lessee.
10. SIGNS. Lessee shall have the right to place new signage at the
Leased Premises at its own expense with the written consent of the Lessor, which
consent Lessor will not unreasonably withhold.
11. MAINTENANCE AND REPAIRS OF LEASED PREMISES. The Lessee shall
maintain, at its expense, the exterior and interior of the Leased Premises and
the Building containing the Leased Premises in a neat, clean and sanitary
condition, and shall, at its expense, keep the exterior and interior in good
repair, reasonable wear and tear excepted, including but not limited to, snow
removal, trash removal, landscape maintenance and repair, walls, ceilings,
paint, wall coverings, carpeting, floor coverings, doors, windows, and door and
window moldings. The Lessee shall, at its expense, maintain in good repair the
electrical, plumbing, heating, air conditioning and ventilation systems of the
Leased Premises and the Building containing the Leased Premises. The Lessee
shall be responsible for replacing light bulbs and fluorescent tubes within the
Leased Premises and the Lessee, at its expense, shall be responsible for the
maintenance and repair of the
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fixtures and other personal property belonging to the Lessee. The Lessee shall
be responsible for the maintenance of any and all improvements or alterations
made by the Lessee on buildings adjacent to the Building of which the Leased
Premises is a part. All repairs and replacements will be at least equal to the
original work in style, quality, and class. Lessee's obligation to maintain the
premises herein shall not be deemed an obligation for additional rents or direct
payments to Lessor.
12. LESSOR'S RESPONSIBILITIES TO MAINTAIN THE LEASED PREMISES.
Lessor, during the term of the Lease, shall be responsible to maintain and
repair the roof, foundation and structural integrity of the Leased Premises.
Lessor warrants that the heating, plumbing, HVAC, fire sprinkler and
electrical system are in good working order on the date of this Lease.
13. RIGHT OF ENTRY. The Lessor will have the right to enter the
Leased Premises at all reasonable times to examine and inspect the Leased
Premises.
14. ASSIGNMENT AND SUBLETTING.
a. LESSOR'S CONSENT REQUIRED. The Lessee shall not assign,
transfer, mortgage, pledge, hypothecate or encumber this Lease or any interest
therein, and shall not sublet the Leased Premises or any part thereof or any
right or privilege pertinent thereto to a third party, or suffer any other third
party (the agents and employees of the Lessee accepted) to occupy or use the
Leased Premises, or any portion thereof, without the prior written consent of
the Lessor.
b. REASONABLE CONSENT. If the Lessee is not in default under
the terms of this Lease, the Lessor shall not unreasonably withhold its consent
to the subletting of the Leased Premises or any portion thereof or the
assignment of this Lease. No consent by Lessor to any assignment or subletting
shall relieve the Lessee from any of the provisions, covenants, and conditions
of this Lease on the part of the Lessee to be kept and performed. The consent by
the Lessor to any assignment or subletting shall not relieve the Lessee from the
obligation to obtain the consent of the Lessor to any other subsequent
assignment or subletting.
15. QUIET ENJOYMENT. Upon Lessee paying the rent reserved hereunder
and observing and performing all of the covenants, and provisions on Lessee's
part to be observed and performed hereunder, Lessee shall have quiet enjoyment
of the Leased Premises for the entire Lease Term, subject to all provisions of
this Lease.
16. PARKING. Lessor shall provide 150 parking spaces for use by
Lessee and Lessee's business guests and invitees. Lessee, at Lessee's
expense, shall maintain and keep clean all parking areas associated with the
Leased Premises.
17. DEFAULTS AND REMEDIES.
a. DEFAULT CONDITIONS AND CONSEQUENCES. Lessee shall be in
material default of
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the Lease if one or more of the following events occurs:
(1) The Lessee defaults in the payment of any rent
or other payment of money provided to be paid in this Lease
and the default continues for fifteen (15) days after written
notice that amounts are due; or
(2) The Lessee defaults in the observance or
performance of any other covenant, term, or condition hereof
and the Lessee fails to remedy the default within thirty (30)
days after receipt of notice from the Lessor specifying the
nature of the default.
(3) The Lessee is adjudged bankrupt or becomes
insolvent or a receiver is appointed for the benefit of
Lessee or Lessee makes an assignment for the benefit of
creditors.
(4) The Lessee vacates the Leased Premises.
In the event or occurrence of default, in any such case as specified
above, in addition to any other rights or remedies that the Lessor may have,
including, but not limited to, the right to terminate this Lease, and the rents
due under the Lease for the balance of the initial Term, or any renewal term if
the initial Term has expired, shall be immediately accelerated and become due
and payable in full. Lessor shall have the right to exclude the Lessee from the
Leased Premises, and to re-enter the Leased Premises and to remove the Lessee's
property therefrom. Such property may be stored by the Lessor at the expense of
the Lessee. No such re-entry will be considered or construed to be a forcible
entry.
18. UNLAWFUL DETAINER AND ATTORNEY FEES. If suit is brought for an
unlawful detainer of the Leased Premises, for the recovery of any rent due under
the provisions of this Lease, or because of the breach of any other covenant
contained herein, the prevailing party will be entitled to an award of its
reasonable attorney's fee against the other party, and such attorney's fee shall
be deemed to have accrued at the commencement of the action.
19. NOTICES. Any notice that must, under the terms of this Lease or
under any law, ordinance or regulation, be given by the parties will be in
writing and will be given by personal delivery or by mailing by certified mail,
return receipt requested, addressed as follows:
1. One copy to: LESSOR:
KEB ENTERPRISES, L.P.
000 Xxxx Xxxxxx
XX Xxx 0000
Xxxx, Xxxx 00000
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2. One copy to: LESSEE:
SENTO CORPORATION
Attention: Xxxx Xxxxxx
000 Xxxx Xxxx Xxxxxx Xxxxx
Xxxxxxxx Xxxx, Xxxx 00000
Any party may from time to time designate a change in address by
notice in writing to the other party.
20. BROKER FEES AND SIMILAR PAYMENTS: CONFIRMATION OF AGENCY
DISCLOSURE. Lessor shall pay any brokerage fees which are due to any broker or
agent with whom Lessor has contracted in connection with the lease of the Leased
Premises. Lessee shall pay any brokerage fees which are due to any broker or
agent with whom Lessee has contracted in connection with the lease of the Leased
Premises. Each party shall bear their own costs in negotiating and documenting
this transaction.
21. SURRENDER OF PREMISES. HOLDING OVER.
a. SURRENDER. Upon the termination of this Lease, by expiration
or otherwise, the Lessee will surrender the Leased Premises to the
Lessor in as good condition and repair as when delivered by the
Lessor, reasonable wear and tear excepted.
b. HOLDING OVER TERMS. Any holding over with the written or
oral consent of the Lessor shall constitute a month to month lease
under which rent shall be payable at the rate of $4.50 per rentable
square foot, payable on or before the first day of each month of the
holdover period, and shall otherwise be on the terms and conditions
set forth in this Lease. Any hold-over term shall be subject to
termination by Lessor immediately upon written notice from Lessor.
22. SUCCESSORS AND ASSIGNS. The covenants and agreements of this
Lease will apply to, be to the benefit of, and be binding upon the parties,
their heirs, distributees, administrators, legal representatives, assigns (to
the extent that assignment is permitted by the Lessor), and successors in
interest, except as otherwise expressly provided herein.
23. MISCELLANEOUS.
a. AUTHORITY. The laws of the State of Utah will govern the
validity, performance, and enforcement of this Lease. Any dispute
arising under this Lease shall be submitted to binding, compulsory
arbitration in accordance with the Utah Arbitration Act, and the
commercial arbitration rules of the American Arbitration Association.
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b. SEVERABILITY. The invalidity or unenforceability of any
provision of this Lease will not affect or impair any other provision
of this Lease.
c. ENTIRE AGREEMENT. This Lease, with its exhibits and
attachments, sets forth the full agreement between the parties as of
the date hereof.
d. WAIVER. This Lease can be modified or altered only by
agreement in writing between the parties. No failure to insist on
strict performance or to exercise any right, power, or remedy in one
circumstance shall operate as a waiver thereof in any other
circumstance.
e. NO RIGHTS IN THIRD PARTIES. Except as expressly set forth
herein, this Lease does not create any rights in third parties.
f. GOOD FAITH. Each party agrees to carry out its obligations
hereunder in good faith.
g. FORCE MAJEURE. Either party shall be excused for a period
of any delay in the performance of any of its obligations hereunder
when prevented from doing so by a cause beyond its control, including
without limitation, strikes and labor disputes, civil commotion, war,
governmental restrictions or control, fire or other casualty,
inability to obtain any material (or a reasonable substitute
therefore), labor or services, acts of God, or failure or slowness of
governmental entities to take action.
i. TIME. Time is of the essence in this Lease and each any
every provision hereof.
j. FINANCIAL STATEMENT. In the event Lessor has reasonable
cause to question the solvency of Lessee, then upon Lessee's written
request, Lessee shall furnish Lessor with an accurate financial
statement.
The parties have caused this Lease to be executed as of the day and
year first above written.
LESSOR: LESSEE:
K.E.B. ENTERPRISES, L.P. SENTO CORPORATION
By By
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Xxxxxxx X. Xxxxxxxxxx Xxxx Xxxxxx
General Partner Its: Chief Financial Officer
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