Mou/Moa - 2013 - Idaho Council Of Governments - 4/9/2013 - MEMORANDUM OF UNDERSTANDING AGREEMENT
BETWEEN THE CITY OF EAGLE
AND
THE IDAHO COUNCIL OF GOVERNMENTS
THIS MEMORANDUM OF UNDERSTANDING AGREEMENT ("Agreement") is
made and entered into this day of Ayr/ / , 2013, by and between the City of Eagle,
Idaho, an Idaho municipal corporation, whose address is 660 E. Civic Lane, Eagle, ID 83616
("City") and the Idaho Council of Governments, an Idaho non-profit corporation, whose address
is 125 E. 50th St., Garden City, ID 83714 ("ICG").
WHEREAS, the City is an Idaho municipal corporation operating under the laws of the
state of Idaho; and
WHEREAS, ICG is an Idaho non-profit corporation whose purposes include economic
development through education,policies and programs; and
WHEREAS, ICG has entered into those certain agreements entitled "Real Estate Lease"
and "Agreement Regarding Sublease," attached hereto as Exhibits A and B, respectively, for the
lease of certain real property within the City of Eagle located at 82 East State Street, Suites D
and F, Eagle, Idaho 83617 (collectively, the "Lease Agreements"), for the purpose of
establishing a business incubator within the City in furtherance of its purposes and goals; and
WHEREAS, the City, by and through its Mayor and City Council, has determined that it
is in the interest of the general welfare of the citizens of the City to support and assist ICG with
the establishment of the business incubator in the City of Eagle by paying the monthly lease
payment for fiscal year 2013 and subsequent years, if the City's budget allows.
NOW, THEREFORE, in consideration of the foregoing recitals, which are incorporated
into this Agreement, the City and ICG agree as follows:
1. Lease Payment; Security Deposit. The City hereby agrees to pay one-half of the
monthly lease payments under the Lease Agreements ($350.00 per month) for fiscal year 2013.
Subject to Section 2 herein, the City further agrees to pay the monthly lease payments for each of
the Lease Agreements for subsequent fiscal years. The City further agrees to pay one-half of the
security deposit under the Lease Agreements ($175.00).
2. Non-Appropriation; Notice. In the event funds are not budgeted and
appropriated in any fiscal year for payments due under this Agreement pursuant to Section 1
herein for the succeeding fiscal year, this Agreement shall impose no obligation on the City as to
such succeeding fiscal year and shall become null and void except as to payments herein agreed
upon for which funds will have been budgeted and appropriated, and no right of action or
damage shall accrue to the benefit of ICG, its successors and assigns, for any further payments.
The City agrees to provide ICG notice and verification of non-appropriation not less than sixty
(60) days prior to the end of its then-current fiscal year at the address identified herein.
MEMORANDUM OF UNDERSTANDING BETWEEN THE CITY OF EAGLE THE IDAHO COUNCIL OF
GOVERNMENTS- 1
3. Indemnification and Hold Harmless. ICG understands and agrees that by
entering into this Agreement, the City does not hereby accept any obligation or liability arising
out of or from the Lease Agreements, except as provided herein. ICG agrees to indemnify,
defend, save and hold the City, its employees, representatives and agents harmless from and
against any and all claims, demands, suits, causes of action or other proceedings arising from
ICG's breach or default of the Lease Agreements, and any and all accidents and/or incidents that
result in injury, death, damage or loss to any party or the personal property of any party that
occur on the leased premises during the terms of the Lease Agreements, and during any
extensions or renewals thereof, which directly or indirectly arise out of any actions, activities or
omissions of or by ICG, or any ICG invitee.
4. Severability. In the event any provision or section of this Agreement conflicts
with applicable law, or is otherwise held to be unenforceable, the remaining provisions shall
nevertheless be enforceable and be carried into effect.
5. Assignment. This Agreement may not be assigned in whole or in part by either
of the parties hereto without the prior express written consent of the other party, and nothing
contained herein shall create any relationship, contractual or otherwise, with, or any rights in
favor of, a third party.
6. Governing Law. This Agreement and its performance shall be construed in
accordance with and governed by the laws of the State of Idaho, with venue for any action
brought pursuant to this Agreement to be in the Fourth Judicial District, State of Idaho.
7. Modification. This Agreement may be modified or amended only by a writing
duly executed by both parties.
8. Termination. The parties shall have the right to terminate this Agreement upon
thirty(30) days written notice to the other party.
IN WITNESS WHEREOF, the parties have hereunto executed this Agreement and made
it effective as herein provided.
City of Eagle, Idaho Idaho Council of Governments
By:h6._, ��� � By:
a. es D. Reynolds R1 yor Kendra Kenyon, President
ATTEST:
w,,enue,e�ei��
I _
Bergmann, MMC
City Clerk/Treasurer ° ":;A
MEMORANDUM OF UNDERSTANDING BETWEEN THE`GI Y blA L,• +THE IDAHO COUNCIL OF
GOVERNMENTS-2 a6.a,a,a�•
IIT__
Page 1 of 4
Real Estate Lease
This Lease Agreement is made effective as of March 1,2013 by and between Schaal,Inc.,Landlord and
The Idaho Council of Governments,Tenant. The parties agree as follows:
1.Premises. Landlord,in consideration of the Lease payments provided in this Agreement,Leases to
Tenant property known as:
82 East State Street Eagle Idaho,Suites F.
2.Term. The lease term shall commence on March 1,2013 and shall terminate on February 28,2014
3.Holdover. If the tenant maintains possession of the premises for any period after the termination of this
Lease(holdover period),Tenant shall pay to Landlord a lease payment for the holdover period based on the
monthly rental amount contained herein.
4.Lease Payments. Tenant shall pay to the Landlord monthly rental payments of$350.00,payable,in
advance,on the first day of each month. Such rent shall become$450 per month effective September
1,2013 and continue throughout the remainder of the term of the Lease.
Payments shall be made to the Landlord at 316 East Main Street Emmett,Idaho 83617,or at such address
that may be changed from time to time.
5.Late Payments. Tenant shall also subject to a late charge of$35 for each monthly payment that is not
received by the Landlord by the tenth calendar day of each month.
6.Security Deposit. At the time of execution of this Lease,Tenant shall pay to Landlord,in trust,the sum
of$350,to be held and disbursed for Tenant damages to the premises,if any,as provided by law.
7.Possession. Tenant shall be entitled to possession on the first day of the term of this Lease and shall
yield possession to Landlord on the last day of the term of this Lease,unless otherwise agreed by both
parties in writing.Tenant is taking possession of the Suite as is and shall be responsible for any cost to re-
key the Suite.Landlord shall be provided one key to the Suite.
8.Use of Premises. Tenant may only use the premises for General and Administrative Activities only.
Any other use of the premises must be approved,in writing,by the Landlord prior to engaging in such other
use.
9.Remodeling or Structural Improvements. Tenant shall have the obligation to conduct any
construction or remodeling(at Tenant's expense)that may be required to use the premises as specified
above,and may construct such fixtures on the premises(at Tenant's expense)that appropriately facilitate
its use for such purposes. Such construction shall be undertaken and such fixtures may be erected only
with the prior written consent of Landlord.Such consent shall not be unreasonably withheld.At the end of
the Lease Term,Tenant shall be entitled to remove(or at the request of Landlord shall remove)such
fixtures,and shall restore the premises to substantially the same condition of the premises at the
commencement of the Lease.
10, Maintenance. Landlord shall have the obligation to maintain the premises in good repair at all times.
11.Access by Landlord to Premises. Subject to Tenant's consent(which shall not be unreasonably
withheld),Landlord shall have the right to enter the premises to make inspections,repairs,provide
necessary services,or show the property to prospective buyers,mortgagees,tenants and workmen. As
provided by law,in the case of an emergency,Landlord may enter the premises without the consent of the
Tenant.
Page 2 of 4
12.Utilities and Services. Tenant shall be responsible for the following utilities and services in
connection with the premises:
A. Electricity,gas,heating,janitorial services and telephone service and fees.
B. Replacement of light bulbs and tubes.
Landlord shall be responsible for.
A. Water,sewer,outside trash container
B. Snow removal.
13.Signage. Tenant is permitted to place the following signage stating the name of the business
conducted on the premises:
A. A rustic sign on the designated area(upright posts)as you enter the parking lot from State Street.
B. Decal type on any window of Tenant's premises.
Signage to be approved by Landlord in advance if not in keeping with the format present at the time
Tenant begins Lease period.
14.Property Insurance. Landlord and Tenant shall each be responsible to maintain appropriate
insurance for their respective interests in the premises and personal property located on the premises.
15.Liability Insurance. Tenant shall maintain a combined single limit insurance policy with limits of no
less than$1,000,000.00 per occurrence and a$2,000,000.00 aggregate.Tenant shall deliver to Landlord
appropriate proof of insurance and shall also name Landlord as additional insured on the policy. Landlord
shall have the right to receive any notices relating to termination of such required insurance coverage.
16.Indemnity Regarding Use of Premises. Tenant agrees to indemnify,hold harmless and defend
Landlord from and against any and all losses,claims,liabilities and expenses,including reasonable
attorney fees,if any,which the Landlord may suffer or incur in connection with Tenant's use of the
premises.
17.Taxes. Taxes attributable to the premises or use of the premises shall be allocated as follows:
A. Real Estate Taxes and Assessments. Landlord.
B. Personal Taxes attributable to use of premises. Tenant.
18.Destruction or Condemnation of Premises. If the leased premises are partially destroyed in a
manner that prevents the conducting of Tenant's use of the premises in a normal business manner,and if
the damage is reasonably reparable within sixty days after the occurrence of the damage,and if the cost of
the repair is less than$10,000.00,Landlord shall repair the premises and lease payments shall abate during
the period of repair. However,if the damage is not reparable within sixty days,or the cost of the repair is
more than$10,000.00,or if the Landlord is prevented from repairing the damages by forces beyond
Landlord's control,or if the property is condemned,this Lease shall terminate upon twenty days written
notice of such event or condition of the property.
19. Mechanics Liens. Neither the Tenant nor anyone claiming through the Tenant shall have the right to
file mechanics liens or any other kind of lien on the premises. Further,Tenant agrees to give actual
advance notice to any contractors,subcontractors or suppliers of goods,labor,or services that such liens
will not be valid.
Page 3 of 4
20. Defaults. Tenant shall be in default of this Agreement if Tenant fails to fulfill any obligation or term
under the Agreement by which Tenant is bound. Subject to any governing provisions of the law to the
contrary,if Tenant fails to cure any financial obligation within three days(or any other obligation within
ten days)after written notice of such default is provided by the Landlord to Tenant,Landlord may take
possession of the premises without further notice,and without prejudicing Landlord's right to damages.
In the alternative,Landlord may elect to cure any default and the cost of such action shall be added to
Tenant's financial obligations under this Agreement. Tenant shall pay all costs,damages and expenses
suffered by Landlord by reason of Tenant's default(s).
21.Cumulative Rights. The rights of the parties under this Lease are cumulative,and shall not be
construed as exclusive unless otherwise required by law.
22.Assignability/Subletting. Tenant may not assign or sublease any interest in the premises without the
prior written consent of Landlord which shall not be unreasonably withheld.
23.Notice. Notices under this Lease shall not be deemed valid unless given or served in writing and
forwarded by mail,postage prepaid,and addressed as follows:
Landlord 316 East main Street Emmett,Idaho 83617
Tenant 82 East State Street Suite F Eagle,Idaho 83616
24.Entire Agreement/Amendment. This Agreement contains the entire agreement of the parties,and
there are no other promises or conditions in any other agreement whether oral or written. The Agreement
may be modified or amended in writing,so long as the writing is signed by the party obligated under the
amendment.
25.Severability. If any portion of this Lease shall be held to be invalid or unenforceable for any reason,
the remaining provisions shall continue to be valid and enforceable. If a court finds that any provision of
the Lease is invalid and unenforceable,but that by limiting such provision it would become valid or
enforceable,then such provision shall be deemed to be written,construed and enforced as so limited.
26.Subordination of Lease. This Agreement is subordinate to any mortgage that now exists,or may be
given later by Landlord,with respect to the premises.
27. Option to Renew Lease. Tenant shall have the right to extend the lease under terms contained herein
for an additional three year period to commence on March 1,2014. Such extension shall be granted so
long as tenant is not in default for any terms existing under this Agreement and notice to exercise this
option is received in writing by the Landlord sixty days prior to expiration of this Lease. The monthly
rental amount will be agreed to by the Landlord and Tenant thirty(30)days prior to expiration of the
current Lease period.
28.Application of Funds Received
The Tenant has placed$1,400.00 with the Landlord as of March 1,2013.It is agreed by the parties that
such funds shall be applied as follows:
March 2013 rent $350.00
April 2013 rent 350.00
May 2013 rent 350.00
Security Deposit 350.00
Total $1,400.00
Page 4 of 4
29.Charkabk Receipt
Tenant agrees that fire Suite has a fair market rent value of$750 per month and shall provide a
Contribution Receipt,in the Landlords name for the difference between the Fair Market Value of the Suite
and the actual amount paid for the Suite for each calendar year.Such Receipt shall be provided to the
Landlord by January 31 of each year.
juntistoreAvtatman;pmedh ---
4
Read,Understood and Agreed to this 1°day of March,2013
Walt B
Schaal,Inc.
President
Kendra Kenyon
Idaho Council of Governments
EXHIBIT
AGREEMENT REGARDING SUBLEASE
Agreement effective March 11, 2013 between the Landlord and Tenant identified below.
1. BACKGROUND.
1.1 Master Lease. The Landlord and the Tenant are parties to a lease dated February
15, 2011 covering certain premises located at 82 East State Street, Eagle, ID, Suite D
("Master Lease"). A true and correct copy of the Master Lease is attached as Exhibit A.
A third party, not a party to this Agreement, has also leased a portion of the premises;
such portion is not included in this Agreement for lease by the Subtenant.
1.2 Consent to Sublease. Pursuant to an email dated March 7, 2013, the Landlord
has consented to a sublease of the premises on the terms and conditions set forth in
this Agreement.
1.3 Defined Terms. Terms that are defined in the Master Lease shall have the same
meaning when set forth in this Agreement unless the term is expressly defined
differently in this Agreement.
2. BASIC PROVISIONS AND DEFINITIONS. The following basic provisions and
definitions shall be construed in conjunction with, and limited by, the provisions of this
Agreement:
2.1 Landlord: Schaal, Inc., an Idaho corporation, whose mailing address is 316 E.
Main St., Emmett, ID 83617.
2.2 Tenant: Evans Realty, LLC, an Idaho limited liability company, whose mailing
address is PO Box 611, Emmett, ID 83617.
2.3 Subtenant: Idaho Council of Governments, Inc., an Idaho corporation, whose
mailing address is 125 E 50th St., Garden City, ID 83714.
2.4 Term and Commencement Date. The Term of this Sublease shall commence on
March 11, 2013 ("Commencement Date") and terminate on February 14, 2014, unless
terminated earlier as provided in the Master Lease ("Term").
2.5 Rent. The Subtenant shall pay to the Tenant the monthly rent of Three Hundred
Fifty Dollars ($350.00) ("Rent").
2.6 Permitted Use. The permitted use is general and administrative activities
("Permitted Use").
3. RIDERS. This Agreement includes the following rider which shall constitute a part
of this Agreement:
• Additional Terms
4. GENERAL RIGHTS AND OBLIGATIONS OF TENANT AND SUBTENANT. Except as
expressly provided otherwise in this Agreement, (i) the Tenant, with respect to the Subtenant,
shall have all of the rights and assume all of the obligations that the Landlord has with respect
to the Tenant set forth in the Master Lease, and (ii) the Subtenant, with respect to the Tenant,
SUBLEASE- 1
shall assume, fully perform, and be subject to all of the representations, covenants,
conditions, and agreements of the Tenant to the Landlord set forth in the Master Lease.
5. GENERAL PROVISIONS.
5.1 Notices. All notices or other communications under this Agreement shall be in writing
and shall be deemed to be delivered on the date of delivery if delivered in person or on the date
of receipt indicated on the return receipt if delivered by U.S. Mail, certified or registered,
return receipt requested, postage prepaid and addressed to the relevant address set forth
above (or at such other address as one party may give to another party by written notice).
5.2 Assignment and Subletting. Subtenant may not, without the prior written consent of
Landlord and Tenant, (i) assign this Agreement or any interest in this Agreement, (ii) permit or
suffer any assignment of this Agreement by operation of law, (iii) further sublet all or any
portion of the demised premises, or (iv) permit the use of the demised premises by any party
other than the Subtenant and its officers and employees. Landlord's and Tenant's consent to
any proposed assignment or subletting may be withheld for any reason or no reason. If
Landlord or Tenant decide to consent, such consent may require that (i) the credit history,
financial strength, and business reputation of the subtenant or assignee is acceptable to the
Landlord and Tenant, (ii) the Subtenant demonstrates to the satisfaction of the Landlord and
Tenant that the business of any subtenant will not detract from the efficient and profitable
operation of the Subtenant's or Tenant's business, and (iii) the Subtenant pays the reasonable
costs (including attorney fees) incurred by the Landlord and the Tenant in such subletting or
assignment. No assignment or subletting shall release the Subtenant from any of the
obligations set forth in this Agreement.
5.3 Governing Law, Jurisdiction, and Forum. This Agreement shall be construed and
interpreted in accordance with the laws of the State of Idaho. The parties agree that the
courts of Idaho shall have exclusive jurisdiction and agree that Ada County is the proper
venue.
5.4 Attorney Fees and Costs. The parties agree that if a party is in default under this
Agreement, then such party shall pay to the other party (a) reasonable attorney fees and other
costs and expenses incurred by the other party after default and referral to an attorney, (b)
reasonable attorney fees and other costs and expenses incurred by the other party in any
settlement negotiations, (c) reasonable attorney fees and other costs and expenses incurred by
the other party in preparing for and prosecuting any suit, action, or other proceeding, and (d)
all costs and attorney fees incurred in preparing for and prosecuting any appeal of any suit,
action, or other proceeding ("Collection Costs"). Collection Costs shall be immediately due and
payable.
5.5 Non-recording. Without prior consent of the other parties, all parties agree not to record
this or any memorandum of this Agreement.
5.6 Time of the Essence. Time is of the essence with respect to the obligations to be
performed under this Agreement.
5.7 Entire Agreement. All Schedules and Exhibits to this Agreement constitute a part of
this Lease. This Lease, together with the accompanying Schedules and Exhibits, constitutes
the entire agreement among the parties and supersedes all prior memoranda, correspondence,
conversations and negotiations.
SUBLEASE-2
6. SIGNATURES.
TENANT
Evans Realty, LLC
Dated: I ( - x'013
, 2013
Otani-.1
Teena Turner, Manager
SUBTENANT
Idaho Council of Governments, Inc.
Dated: II /aD! , 2013
Kendra Kenton, President
SUBLEASE- 3
Additional Terms
1. On-site copier. The copier currently on the premises shall remain. Subtenant shall pay
Tenant One Dollar ($1.00) per month for use of such copier. Subtenant shall contract service
and maintenance of the copier and provide Tenant with accounting codes to the copier for
Tenant's use of copier services and scanning. Tenant shall supply its own paper for copier
use, to be secured separate from Subtenant's paper supplies. Subtenant shall be allocated
five hundred (500) copies per month; any unused portion shall not be carried over to the next
month. Tenant shall be financially responsible for copier use over such five hundred (500)
maximum.
2. Conference Room. Tenant shall be entitled to book the conference room sixteen (16)
hours per month during regular business hours 8 to 5 Monday thru Friday and unlimited use
after business hours; such schedule to be coordinated through Subtenant. Subtenant shall
provide Tenant with a separate key to access the conference room.
3. Agents on premises. Tenant shall not permit more than five (5) of its agents on the
premises at any one time so as not to interfere with Subtenant's business.
4. Common Areas. With the exception of Suite F, Tenant shall be entitled to use the
premises' common areas. Common areas include upstairs patio, upstairs open space, and
downstairs large sitting meeting room with sofa/tables. Tenant shall also be allowed to use the
TVs and projectors on site for presentations to be coordinated through Subtenant.
5. Utilities. Subtenant shall be responsible for electricity, gas, heating,janitorial service and
fees, phones, and internet and the replacement of light bulbs and tubes. Landlord shall be
responsible for Water, Sewer, outside trash container, and snow removal. Tenant shall have
no utility responsibility but shall be entitled to use the wireless internet services and phone for
local calls. Tenant's existing phone line shall be forwarded to its Emmett office.
6. Signage. Tenant's existing street sign shall remain and an office sign shall be placed in
the premises'window to denote Tenant's business presence.
7. Rent Adjustment. Subtenant's Rent shall remain unchanged during the Term. As to the
portion of the premises not being subleased, but still subject to the Master Lease, Subtenant
shall not be entitled to an adjustment of Master Lease rent; such adjustment shall remain for
the benefit of the Tenant.
8. Early Termination. Subtenant expressly acknowledges section 29 of the Master Lease,
and agrees to pay Tenant any payment required therein if Subtenant terminates this
Agreement prior to the Term.
9. Security Deposit. No Security Deposit shall be required.
10. Maintenance. Tenant shall not have the obligation to maintain the premises.
11. Option to Renew. Subtenant shall have no right to extend or renew this Agreement or the
Master Lease.
SUBLEASE- 4
Page 1 of 4
Real Estate Lease
This Lease Agreement is made effective as of February 15,2011 by and between Schaal,Inc.,Landlord
and,Evans Realty,LLC,Tenant. The parties agree as follows:
1.Premises. Landlord,in consideration of the Lease payments provided in this Agreement,Leases to
Tenant property known as:
82 East State Street Eagle Idaho Suite D.
2.Term. The lease term shall commence on February 15,2011 and shall terminate on February 14,
2014..
3.Holdover. If the tenant maintains possession of the premises for any period after the termination of this
Lease(holdover period),Tenant shall pay to Landlord a lease payment for the holdover period based on the
monthly rental amount contained herein.
4.Lease Payments. Tenant shall pay to the Landlord monthly rental payments of$675,payable,in
advance,on the first day of each month. The initial payment is prorated for the month of February
and shall be$313. Rent for year 2 shall be$1,099 and rent for year 3 shall be$1,135
Such payments shall be made to the Landlord at 316 East Main Street Emmett,Idaho 83617,or at such
address that may be changed from time to time.
5. Late Payments. Tenant shall also pay a late charge of$40.00 for each monthly payment that is not
received by the Landlord by the tenth calendar day of each month.
6.Security Deposit. At the time of execution of this Lease,Tenant shall pay to Landlord,in trust,the sum
of$1,065,to be held and disbursed for Tenant damages to the premises,if any,as provided by law.
7.Possession. Tenant shall be entitled to possession on the first day of the term of this Lease and shall
yield possession to Landlord on the last day of the term of this Lease,unless otherwise agreed by both
parties in writing.
8. Use of Premises. Tenant may only use the premises for General and Administrative Activities only.
Any other use of the premises must be approved,in writing,by the Landlord prior to engaging in such other
use.
9.Remodeling or Structural Improvements. Tenant shall have the obligation to conduct any
construction or remodeling(at Tenant's expense)that may be required to use the premises as specified
above,and may construct such fixtures on the premises(at Tenant's expense)that appropriately facilitate
its use for such purposes. Such construction shall be undertaken and such fixtures may be erected only
with the prior written consent of Landlord. Such consent shall not be unreasonably withheld.At the end of
the Lease Term,Tenant shall be entitled to remove(or at the request of Landlord shall remove)such
fixtures,and shall restore the premises to substantially the same condition of the premises at the
commencement of the Lease.
10. Maintenance. Landlord shall have the obligation to maintain the premises in good repair at all times.
11.Access by Landlord to Premises. Subject to Tenant's consent(which shall not be unreasonably
withheld),Landlord shall have the right to enter the premises to make inspections,repairs,provide
necessary services,or show the property to prospective buyers,mortgagees,tenants and workmen. As
provided by law,in the case of an emergency, Landlord may enter the premises without the consent of the
Tenant.
EXHIBIT A - 1
Page 2 of 4
12.Utilities and Services. Tenant shall be responsible for the following utilities and services in
connection with the premises:
A. Electricity,gas,heating,janitorial services and telephone service and fees.
B. Replacement of light bulbs and tubes.
Landlord shall be responsible for:
A. Water,sewer,outside trash container
B. Snow removal.
13.Signage. Tenant is permitted to place the following signage stating the name of the business
conducted on the premises:
A. A rustic sign on the designated area(upright posts)as you enter the parking lot from State Street.
B. Decal type on any window of Tenant's premises.
Signage to be approved by Landlord in advance if not in keeping with the format present at the time
Tenant begins Lease period.
14.Property Insurance. Landlord and Tenant shall each be responsible to maintain appropriate
insurance for their respective interests in the premises and personal property located on the premises.
15.Liability Insurance. Tenant shall maintain a combined single limit insurance policy with limits of no
less than$1,000,000.00 per occurrence and a$2,000,000.00 aggregate.Tenant shall deliver to Landlord
appropriate proof of insurance and shall also name Landlord as additional insured on the policy. Landlord
shall have the right to receive any notices relating to termination of such required insurance coverage.
16.Indemnity Regarding Use of Premises. Tenant aggress to indemnify,hold harmless and defend
Landlord from and against any and all losses,claims,liabilities and expenses,including reasonable
attorney fees,if any,which the Landlord may suffer or incur in connection with Tenant's use of the
premises.
17.Taxes. Taxes attributable to the premises or use of the premises shall be allocated as follows:
A. Real Estate Taxes and Assessments. Landlord.
B. Personal Taxes attributable to use of premises. Tenant.
18.Destruction or Condemnation of Premises. If the leased premises are partially destroyed in a
manner that prevents the conducting of Tenant's use of the premises in a normal business manner,and if
the damage is reasonably reparable within sixty days after the occurrence of the damage,and if the cost of
the repair is less than$10,000.00,Landlord shall repair the premises and lease payments shall abate during
the period of repair. However,if the damage is not reparable within sixty days,or the cost of the repair is
more than$10,000.00,or if the Landlord is prevented from repairing the damages by forces beyond
Landlord's control,or if the property is condemned,this Lease shall terminate upon twenty days written
notice of such event or condition of the property.
19. Mechanics Liens. Neither the Tenant nor anyone claiming through the Tenant shall have the right to
file mechanics liens or any other kind of lien on the premises. Further,Tenant agrees to give actual
advance notice to any contractors,subcontractors or suppliers of goods, labor,or services that such liens
will not be valid.
EXHIBITA - 2
Page 3 of 4
20. Defaults. Tenant shall be in default of this Agreement if Tenant fails to fulfill any obligation or term
under the Agreement by which Tenant is bound. Subject to any governing provisions of the law to the
contrary,if Tenant fails to cure any financial obligation within three days(or any other obligation within
ten days)after written notice of such default is provided by the Landlord to Tenant,Landlord may take
possession of the premises without further notice,and without prejudicing Landlord's right to damages.
In the alternative,Landlord may elect to cure any default and the cost of such action shall be added to
Tenant's financial obligations under this Agreement. Tenant shall pay all costs,damages and expenses
suffered by Landlord by reason of Tenant's default(s).
21.Cumulative Rights. The rights of the parties under this Lease are cumulative,and shall not be
construed as exclusive unless otherwise required by law.
22.Assignability/Subletting. Tenant may not assign or sublease any interest in the premises without the
prior written consent of Landlord which shall not be unreasonably withheld.
23.Notice. Notices under this Lease shall not be deemed valid unless given or served in writing and
forwarded by mail,postage prepaid,and addressed as follows:
Landlord 316 East main Street Emmett,Idaho 83617
Tenant 82 East State Street Suite D Eagle,Idaho 83616
24.Entire Agreement/Amendment. This Agreement contains the entire agreement of the parties,and
there are no other promises or conditions in any other agreement whether oral or written. The Agreement
may be modified or amended in writing,so long as the writing is signed by the party obligated under the
amendment.
25.Severability. If any portion of this Lease shall be held to be invalid or unenforceable for any reason,
the remaining provisions shall continue to be valid and enforceable. If a court finds that any provision of
the Lease is invalid and unenforceable,but that by limiting such provision it would become valid or
enforceable,then such provision shall be deemed to be written,construed and enforced as so limited.
26.Subordination of Lease. This Agreement is subordinate to any mortgage that now exists,or may be
given later by Landlord,with respect to the premises.
27. Personal Liability. By signing this Agreement,John Evans and Teena Turner,further agree that if,
for any reason,the Tenant fails to perform the financial obligations under this Agreement,John Evans and
Teena Turner shall be personally responsible to perform all such obligations.
28. Option to Renew Lease. Tenant shall have the right to extend the lease under terms contained herein
for an additional three year period to commence on February 15,2014. Such extension shall be granted so
long as tenant is not in default for any terms existing under this Agreement and notice to exercise this
option is received in writing by the Landlord sixty days prior to expiration of the three year period covered
under this Lease. Monthly rental amount will be adjusted by the cost of living increase for the area
occurring in the third year of the initial lease period.
EXHIBIT A - 3
Page 4 of 4
29. Early termination of Lease Term. The Tenant may terminate this Agreement in advance of the term
contained under Section 2 of this Agreement,so long as all other provisions of the Agreement have been
performed. A payment will accompany Tenant's written request for early termination. The payment ids
determined as follows:
Date of notice given(must be thirty
prior to effective date)
Cancellation Payment Amount
Month one through twelve Four Months Rent
Month thirteen through twenty four
Month twenty five through thirty four Two o e Moonths nths Three R Rent
Read,Understood and Agreed to this 28th day of January,2011:
Walt B Schaal for
Schaal,Inc.
President
John Evens Tenant
Teena Turner Tenant
EXHIBIT A - 4