Exhibit 10.7
LEASE AGREEMENT
This Lease Agreement (the "Agreement") is entered into this 16 day of
March, 1998, to be effective January 1, 1998, between KSL, a division of
Bonneville International Corporation, a Utah corporation, with its principal
place of business at Xxxxxxxxx Xxxxx, 00 Xxxxx 000 Xxxx, X. O. Xxx 0000, Xxxx
Xxxx Xxxx, Xxxx 00000-0000 ("Lessor"), and KRSP, Inc., a Utah corporation, with
its principal place of business at 00 Xxxx Xxxxx Xxxxxx, Xxxxx 000, Xxxx Xxxx
Xxxx, Xxxx 00000 ("Lessee").
RECITALS
Lessor owns certain radio and television transmission facilities situated
in the Oquirrh mountain range in Salt Lake and Tooele Counties, Utah at a
location commonly known as Xxxxxxxxxx Peak (the "Site").
Lessee owns and operates a commercial radio station identified by the call
letters KRSP(FM) located at 103.5 MHz on the FM radio dial (the "Station"), and
has been licensed by the Federal Communications Commission (the "FCC") to
transmit the signal of the Station from the Site.
Lessee desires to lease from Lesser certain space and equipment at the Site
in accordance with the terms and conditions described herein.
AGREEMENT
In consideration of the foregoing recitals and in exchange for good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties agree as follows:
1. LEASED PREMISES. Lessor hereby leases to Lessee, and Lessee hereby
accepts from Lessor, that certain space and equipment at the Site identified on
Schedule A to this Agreement (collectively, the "Premises") for the location and
operation of radio transmitting and receiving equipment for the Station. A
complete list of Lessee-owned equipment located on the Premises (the
"Equipment") is attached to this Agreement as Schedule B.
2. LESSOR FURNISHED ITEMS. During the term of this Agreement, Lessor shall
furnish Lessee with the following:
A. Access to the Site over the access road available to Lessor for
that purpose. Lessee understands that it will be subject to the same
restrictions on the use of such road as may be imposed on Lessor from
time to time by the entities controlling the property upon which the
road is located, including the Kennecott Copper Corporation, Alpha
Communications and Hercules Corporation;
B. Heat, light and toilet facilities at the Site;
C. The right to connect to the power load center at the Site for the
operation of the Equipment. Lessee's use of electricity will be
separately metered by Lessor. Lessor shall invoice Lessee monthly for
such electrical usage at the established commercial rates of the Utah
Power and Light Company, plus the lesser of ten percent of Lessee's
monthly statement or $30.00 for administration and general expenses.
Invoices shall be payable within twenty days of the date of billing.
In the event an invoice is more than ten days delinquent, Lessor, upon
five days written notice, shall be entitled to cease supplying Lessee
with electricity;
D. Upon Lessee's request, emergency service, if available, for the
Equipment. Rates for emergency service are set forth in Schedule O to
this Agreement and may be adjusted from time to time as determined by
Lessor;
E. The right to make reasonable alterations, attach fixtures and erect
additions to the Premises as reasonably required to operate the
Equipment, but only so long as plans for such alterations, attachments
or additions are submitted, along with a list of added and/or replaced
materials, to Lessor for approval, which approval shall not be
unreasonably withheld. In no event shall any of Lessee's alterations,
attachments or additions interfere with the operation or work of
Lessor or of other tenants at the Site;
F. The right to transmit its signal from the Site through the use of
Lessor's FM Combiner system (the "Combiner"). Lessee acknowledges and
agrees that the Combiner must be maintained in order to ensure its
continued effectiveness. Lessor shall be responsible for general
maintenance of the Combiner in accordance with good engineering
practices; provided, however, that if Lessor incurs any cost, fee or
expense in maintaining the body of the Combiner to the end of the
plumbing joint where the tower transmission line exits the Combiner,
Lessor shall provide Lessee with an invoice setting forth the nature
of the maintenance and Lessee's proportionate share thereof and Lessee
shall pay Lessor such amount within twenty days of the date of
invoice. Lessee further acknowledges and agrees that despite regular
maintenance, the effectiveness of the Combiner will deteriorate over
time and it may need to be replaced during the term of this Agreement
or any extension thereof, If Lessor, in the exercise of its judgment,
determines that the Combiner should be replaced during the term of
this Agreement or any extension thereof, Lessee shall be responsible
for a portion of the costs incurred by Lessor in purchasing and
installing any FM combiner system. Lessee's share of such costs shall
be determined by dividing the total cost of purchasing and installing
the new FM combiner system by the number of FM
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radio stations operating on the Combiner immediately prior to its
replacement. Lessee shall pay Lessor such amount within twenty days of
the date of invoice.
G. Other services, such as the use of tools and parts owned by Lessor,
at the rates listed on Schedule O, as such may be adjusted from time
to time as determined by Lessor; and
H. General maintenance of the Site in good operating order.
3. MONTHLY PAYMENTS BY LESSEE. In exchange for the right to occupy the
Premises and operate the Equipment, Lessee shall pay to Lessor the monthly
rental payment and other fees set forth in Schedule C to this Agreement. The
monthly rental payment shall be payable in advance on or before the first day of
each calendar month at Lessors principal place of business or at such other
place or in such other manner as Lessor may from time to time direct; provided,
however, that in the event the term of this Agreement shall commence on other
than the first day of a calendar month or terminate on other than the last day
of a calendar month, the monthly rental payment shall be prorated on a daily
basis for such partial calendar month. Unless otherwise specifically set forth
elsewhere in this Agreement, all other payments required to be made by Lessee to
Lessor shall be paid by within twenty days of the date of invoice.
4. OTHER COSTS. Lessee recognizes that additional expenses may be incurred
by Lessor from time to time for the benefit of Lessee and other tenants at the
Site, such as the cost of transporting various government inspectors, tax
assessors, state and/or county officers/officials and the like to and from the
Site. Lessee agrees to pay its share of such costs on a prorata basis as
calculated by Lessor. Upon request, Lessor shall provide Lessee with proof of
such costs, along with the calculations used to determine the amount charged to
Lessee.
5. COMPLIANCE. Lessee's operations at the Site shall be conducted in full
compliance with all applicable laws, statutes, ordinances, rules and regulations
of any governmental authority having jurisdiction over Lessor, Lessee or the
Site, including, but not limited to, the FCC. Lessee shall bear the cost and
responsibility for all matters pertaining to its operations at the Site,
including, but not limited to, applications, renewals, regular or special
reports, discrepancy citations, inspections or any changes in equipment and/or
operating procedures which may be required from time to time by the FCC or
standards of good engineering practice.
Lessee shall protect all persons at the Site at all times from exposure to
excessive non-ionizing radiation (as determined by the FCC, the Occupational
Safety and Health Agency, the Environmental Protection Agency or any other
governmental authority) which may be generated as a result of Lessee's
operations. In the event Lessee's operations appear to be causing excessive
non-ionizing radiation, Lessor shall have the right, but not the obligation, to
take whatever action Lessor deems appropriate to immediately reduce the amount
of such radiation, including, but not limited to, the interruption of Lessee's
operations or the reduction of Lessee's transmission
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power. Lessor shall invoice Lessee for the costs of any such action and Lessee
shall pay such amount within twenty days of the date of invoice.
6. INTERFERENCE. Lessee acknowledges that Lessor reserves the right to
grant space, premises, facilities and/or rights to third parties at the Site
that are the same as or similar to those granted herein to Lessee. Lessee shall
endeavor in good faith to conduct its activities in accordance with sound
electronic and engineering practices and applicable FCC standards and will
cooperate with Lessor and other tenants at the Site so as to anticipate and
prevent Interference, as that term is defined below. A list of Tenants at the
Site as of the commencement of this Agreement is attached hereto as Schedule S.
If Lessee's operations cause Interference, Lessee shall, at its sole cost
and expense and without recourse to Lessor, cause any such Interference to be
corrected within ten days following written notice thereof to Lessee. Pending
correction, Lessee shall immediately cease the activity or remove the equipment
causing the Interference. If Lessee fails to act in a timely manner, Lessor may
cause the required corrections to be made. Lessor shall invoice Lessee for the
costs of any such action and Lessee shall pay such amount within twenty days of
the date of invoice.
"Interference" shall be deemed to exist if (A) a final determination to
that effect is made by an authorized representative of the FCC pursuant to its
rules and regulations; (B) Lessor determines, in the exercise of its judgment,
that a condition exists which constitutes interference within the meaning of the
provisions of the roles and regulations of the FCC/n effect at the time; or (C)
Lessor makes a good faith determination that its technical operations or the
technical operations of any other tenants at the Site are being adversely
affected by Lessee's activities.
7. LESSOR IMPROVEMENTS. Lessor reserves the right to replace or install
additional equipment necessary or desirable for its own operations or the
operations of other tenants at the Site. Lessor shall not be liable for any
disruption of or interference to Lessee's operations by reason of such
replacement or installation, but Lessor agrees to cooperate with Lessee and to
use reasonable efforts to resolve in advance any problems that might arise in
connection with these activities.
8. ASSIGNMENT OR SUBLEASE. Lessee may not assign or transfer this Agreement
or any interest therein, sublease any interest covered by this Agreement or
encumber, hypothecate or otherwise give as security this Agreement or any
interest therein without the prior written consent of Lessor, which consent
shall not be unreasonably withheld. No assignment, transfer or sublease shall be
effective as against Lessor for any purpose unless Lessor shall have consented
thereto in writing prior to such assignment, transfer or sublease and unless all
sums due from Lessee, together with any costs to Lessor to cover reasonable
legal and other expenses of Lessor in connection with such assignment, transfer
or sublease, shall have been paid to Lessor.
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Each and every attempt to assign, transfer, sublease, encumber or
hypothecate this Agreement or any interest therein in a manner contrary to that
set forth herein may be deemed a default by Lessee hereunder.
Lessor's consent to one assignment, transfer or sublease by Lessee or
acceptance of performance from an assignee, transferee or sublessee shall not be
deemed a waiver by Lessor of the restrictions of this paragraph as to subsequent
attempts to assign, transfer or sublease by Lessee or Lessee's heirs,
successors, assigns, transfers or sublessees. As used herein, the terms Lessor
and Lessee shall be deemed to include their respective heirs, successors,
assigns, transferees and sublessees.
The terms, conditions and covenants contained in this Agreement shall apply
to, inure to the benefit of and be binding upon the parties hereto and their
respective heirs, successors. assigns, transferees and sublessees.
Nothing contained herein shall limit Lessor's right to transfer and/or
assign in any manner whatsoever, in whole or in part, all of its rights and
obligations hereunder and in the Site, and in such event Lessor shall be
released from any further obligations hereunder and the successor-in-interest of
Lessor shall have all the rights and obligations hereunder and in the Site with
respect to Lessee.
9. TERM. The initial term of this Agreement shall be deemed to have
commenced on January 1, 1998 and shall end on December 31, 2007. This Agreement
shall thereafter be renewed for up to two additional ten year periods (from
January 1, 2008 through December 31, 2017 and from January 1, 2018 through
December 31, 2027, respectively) upon the same terms and conditions set forth
herein unless one party provides the other party with written notice at least
ninety days prior to the expiration of the then current term.
10. DEFAULT BY LESSEE. The following events shall be deemed to be events of
default by Lessee under this Agreement (each such event of default is
hereinafter referred to as an "Event of Default"):
A. Lessee shall fail to timely pay any monthly rental payment as
referenced in paragraph 3 above or any other sum of money due
hereunder and such failure shall continue for a period of ten days;
B. Lessee shall fail to comply with any provision of this Agreement
not requiring the payment of money, all of which provisions shall be
deemed material, and such failure shall continue for a period of
twenty days after written notice of such default is delivered to
Lessee;
C. Lessee shall become insolvent or fail to pay its debts as they
become due or Lessee notifies Lessor that it anticipates either
condition;
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D. Lessee takes any action to file a petition under any section or
chapter of the United States Bankruptcy Code or under any similar law
or statute of the United States or any state thereof or a petition
shall be filed against Lessee under any such statute or Lessee or may
creditor of Lessee notifies Lessor that it knows such a petition will
be filed or Lessee notifies Lessor that it expects such a petition to
be filed; or
E. A receiver or trustee shall be appointed for Lessee's leasehold
interest in the Premises or for all or a substantial part of Lessee's
assets.
Upon the occurrence of an Event of Default, Lessor may at its option and
without further notice to Lessee, and in addition to all other remedies given
hereunder or by law or in equity, do any one or more of the following: (A)
terminate this Agreement, in which event Lessee shall immediately surrender
possession of the Premises to Lessor; (B) enter upon the Premises and expel or
remove Lessee and/or Lessee's Equipment therefrom, with or without having
terminated this Agreement; and (C) change or re-key all locks to entrances to
the Site and Lessor shall have no obligation to give Lessee notice thereof or to
provide Lessee with a new key to the Site.
The exercise by Lessor of any one or more remedies hereunder shall not
constitute an acceptance of the surrender of the Premises by Lessee. Lessee
acknowledges that a surrender of the Premises can be effected only by a written
agreement between Lessor and Lessee.
If Lessor terminates this Agreement by reason of an Event of Default,
Lessee shall pay to Lessor the sum of (A) the cost of recovering the Premises;
(B) the unpaid monthly payments and all other indebtedness accrued hereunder to
the term of such termination; (C) to the extent the same were not paid, the cost
of repairing, altering or otherwise putting the Premises into a condition
acceptable to a new tenant or tenants (if Lessor elects to so relet)
(collectively, the "Reletting Expenses"); (D) all expenses incurred by Lesser in
enforcing Lessor's remedies, including attorneys' fees and court costs; (B) the
total monthly payments and other benefits which Lessor would have received under
this Agreement for the remainder of the term, minus any net sums thereafter
received by Lessor through reletting the Premises during such period; and (F)
any other damages or relief which Lessor may be entitled to at law or in equity.
Lessee shall not be entitled to any excess rent obtained by Lessor reletting the
Premises.
If Lessor repossesses the Premises without terminating this Agreement by
reason of an Event of Default, then Lessee shall pay to Lessor the sum of (A)
the cost of recovering the Premises; (B) the unpaid monthly payments and all
other indebtedness accrued hereunder to the date of such repossession; (C) the
Reletting Expenses; (D) all expenses incurred by Lessor in enforcing Lessor's
remedies, including attorneys' fees and court costs; (B) the total monthly
payments and other benefits which Lessor would have received under this
Agreement for the remainder of the term, minus any net sums thereafter received
by Lessor through reletting the Premises during such period; and (F) any other
damages or relief which Lessor may be entitled to at law or in equity. Re-entry
by Lessor will not affect the obligations of Lessee for the unexpired
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term of this Agreement. Lessee shall not be entitled to any excess rent obtained
by Lessor reletting the Premises, Actions to collect amounts due by Lessee may
be brought on one or more occasions without the necessity of Lesson's waiting
until the expiration of the term of this Agreement.
Upon termination of this Agreement or repossession of the Premises due to
an Event of Default, Lessor shall not be obligated to relet or attempt to relet
the Premises or any portion thereof or to collect rent after reletting, but
Lessor shall have the option to relet the whole or any portion of the Premises
for any period to any tenant and for any use and purpose.
11. INSURANCE. Lessee shall at its own cost and expense procure and
maintain general liability insurance coverage and automobile coverage in the
face amount of at least $1,000,000.00 per occurrence and worker's compensation
insurance as prescribed by Utah state law. A certificate of insurance naming
Lessor as an additional insured shall be attached to this Agreement as Schedule
I. In addition, Lessee shall use only certified and insured helicopter carriers
for trips to and from the Site. Such carriers shall carry liability insurance in
the face amount of at least $5,000,000.00 per occurrence. All such insurance
shall cover Lessee's employees, agents and invitees while in, on or about the
Site and while traveling to and from the Site, including losses attributable to
the presence of the Equipment, Lessee's employees, agents or invitees while in,
on or about the Site. Lessee shall be solely responsible for procuring and
maintaining property insurance on the Equipment.
12. INDEMNIFICATION. Lessee shall indemnify, defend and hold harmless
Lessor and any officer, director, employee, contractor, agent or affiliate of
Lessor (collectively, a "Lessor Related Party") From and against any and all
liabilities, obligations, damages, claims, suits, losses, causes of action,
liens, judgments and expenses (including court costs, attorneys' fees and costs
of investigation) of any kind, nature or description resulting from any injuries
to or death of any person or any damage to the Site which either (A) arises from
or is claimed to arise from any act, omission or negligence of Lessee or any
officer, director, employee, contractor, agent, subtenant, guest, licensee or
Invitee of Lessee; (B) arises from a breach, violation or nonperformance of any
term, provision, covenant or agreement of Lessee hereunder or a breach or
violation by Lessee of any court order or any law, regulation or ordinance of
any federal, state or local authority; or ((2) arises from the activities of
Lessee in and around the Site or the operations or conduct of Lessee's business
upon the Site (collectively, the "Claims"), except to the extent such Claims are
directly caused by the gross negligence or willful misconduct of Lessor. If any
such Claim is made against Lessor, Lessee shall at its sole cost and expense
defend such Claim by or through attorneys satisfactory to Lessor. In resolving
or settling any Claim, Lessee shall obtain a release of such Claim made against
Lessor or any Lessor Related Party. The Indemnity obligations of Lessee are in
addition to Lessee's obligations to obtain and maintain insurance as otherwise
provided herein.
Lessee specifically agrees to look solely to Lessor's interest in the Site
for the recovery of any judgment against Lessor.
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13. LIMITS ON LIABILITY. Lessor shall have no liability to Lessee or any
other party for any loss allegedly occasioned by (A) the nontransmission or
partial transmission of Lessee's signal and/or data; (B) damage to the Equipment
by reason of the physical collapse of a tower or antennas; (C) breakdown of a
transmitter or its components; (D) failure or inability of Utah Power and Light
Company to supply electrical power to the Site; (E) failure of Lessor's
emergency generator; (F) acts of God, sabotage, earthquake, fire, theft,
burglary, windstorm or any other hazard (natural or man-made); (G) strikes or
walkouts; (H) cancellation of Lessee's licenses; or (I) any other cause beyond
Lessor's control. Lessor shall have no liability to Lessee or any other party
and Lessee shall indemnify Lessor from and against all claims, costs and
expenses for non-ionizing radiation claimed to originate as a result of Lessee's
operations at the Site.
14. LESSORS' FACILITIES. Lessor shall have first call on its personnel and
equipment at the Site, which personnel and/or equipment may be temporarily
limited by reason of personnel or power shortage and/or demand for
reconstruction following a general breakdown caused by acts within or beyond
Lessor's control. Lessor's emergency power supply equipment at the Site will not
be available to Lessee in the event of a Utah Power and Light Company failure,
except as otherwise provided in Schedule O.
15. PROPERTY TAX. Lessee shall be responsible for any property taxes which
arise from the operation of the Equipment at the Site. Lessee acknowledges that
the Equipment may be located in Salt Lake and/or Tooele Counties.
16. LATE CHARGES. Any amount owing to Lessor from Lessee under this
Agreement that is thirty days past due shall be assessed a late charge of $50.00
per invoice per month for each invoice totaling less than $500.00 and a late
charge of $200.00 per invoice per month for each invoice that is equal to or
greater than $500.00.
17. ROAD MAINTENANCE CHARGE. Lessee acknowledges and agrees that an annual
charge shall be assessed by Lessor to Lessee to cover access roadway maintenance
and repairs. This cost shall be prorated among the various users of the
Xxxxxxxxxx Peak/Little Xxxxxxxxxx Peak areas and is due and payable from Lessee
on or before July 1st annually.
18. NOTICES. All notices to be given under this Agreement shall be in
writing and shall be deemed to have been given if delivered personally, mailed
by certified mail, return receipt requested, or delivered by recognized
commercial courier to the other party at its last known business address.
19. GOVERNING LAW. This Agreement shall be interpreted under and governed
by the laws of the State of Utah.
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20. ENVIRONMENTAL REPRESENTATIONS AND WARRANTIES. Neither Lessee nor
Lessee's agents, contractors, authorized representatives or employees shall
engage in any of the following prohibited activities in, on or about the Site:
A. Cause or permit any releases, discharges or spills of Hazardous
Material on or from the Site;
B. Cause or permit any manufacturing, holding, handling, retaining,
transporting spilling, leaking, treating, disposing or dumping of
Hazardous Material in or on any potion of the Site;
C. Cause or permit to be located on the Site any underground or
above-ground tanks for the storage of fuel oil, gasoline and/or other
petroleum products or by-products;
D. Cause or permit any releases, discharges or spills of fuel oil,
gasoline and/or other petroleum products or by-products; or
E. Otherwise place, keep, or maintain, or allow to he placed, kept or
maintained, any Hazardous Material on any portion of the Site.
For purposes of this paragraph, "Hazardous Material" means any radioactive,
hazardous or toxic substance, material, waste or similar terms, including,
without limitation, petroleum and petroleum products, the presence of which at
the Site or the discharge or emission of which from the Site or the collection,
storage, treatment or disposal of which is regulated by governmental
requirements or regulations.
21. WAIVER. The parties agree that the waiver of any breach of this
Agreement by either party shall in no event constitute a waiver as to any
further breach.
22. HEADINGS. Headings on each paragraph of this Agreement are for
reference purposes only and shall not be deemed to have any substantive effect.
23. ENTIRE AGREEMENT CONSTRUCTION. This Agreement constitutes the entire
agreement between the parties with respect to the subject matter hereof and
supersedes all prior agreements, contracts or other arrangement. Lessee
represents and warrants that it has all right, title and interest necessary to
execute this Agreement. No amendments, modifications or supplements to this
Agreement shall be binding unless executed in writing by the parties hereof.
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In witness whereof, the parties have executed this Agreement as of the date
first listed above.
KSL, a Division of Bonneville
International Corporation
By: /s/ XXX
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Its: VP & GM
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Xxxxxxx Family, Inc.
By: /S/ G. Xxxxx Xxxxxx
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Its: EXEC. V. P.
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