EXHIBIT 10.9


OLD MILL CORPORATE
CENTER


THIS LEASE AGREEMENT (the “Lease”) is dated the 27th day of November,
2001, between HOLLADAY BUILDING EAST L.L.C., (“ Lessor”) and Overstock.com
(“Lessee”).


WITNESSETH:



ARTICLE I


Section 1.1             Premises.  The Lessor hereby leases to Lessee, and
Lessee leases from Lessor, upon the terms and conditions of this Lease, those
premises outlined on a floor plan attached hereto as Exhibit “A” and made a
part hereof (the “Premises”), and containing approximately 3,095 rentable
and 2,623 usable square feet located on the First floor, suite #105
of the building known as Old Mill Corporate Center (the “Building”)
located at 6322 South 3000 East, Salt Lake City, Utah 84121.  The term “Property” shall refer to the
Building and real property, the entire site, together with any and all
appurtenances, rights, privileges and easements pertaining thereto including
but not limited to the elevators, stairways, corridors, entranceways, rest
rooms, walkways, roadways, driveways, loading docks, cafeteria, parking
facilities and other similar or related facilities (collectively “Common
Areas”) as may exist in and about the Building and Property.


Lessor and Lessee are aware and acknowledge that the foregoing area
contains Lessee’s allocated share of the common area of the building.


Section 1.2             Term.  This Lease shall commence on the date Lessor
delivers to Lessee possession of the Premises in substantially complete
condition (as defined in Section 2.1 hereinafter) (the “Commencement
Date”) and shall terminate on the date two (2) years following the
Commencement Date.


ARTICLE II


Section 2.1             Possession.


I.              The
parties intend for Lessor to deliver possession of the Premises to Lessee in
substantially complete condition on January 1, 2002.  Nevertheless, Lessee is aware and
acknowledges that Lessor may be unable to deliver possession of the Premises on
such date due to causes beyond the reasonable control of Lessor.  In such event, this Lease shall remain in
full force and effect; and Lessor shall have no liability to Lessee whatsoever
as a result of the delay in delivery of possession.


II.            In
the event Lessor is able to deliver to Lessee possession of the Premises in
substantially complete condition prior to January 1, 2002, Lessee
may but shall not be required to take possession of the Premises at any time
prior to January 1, 2002.


 

















 


III.           In
the event Lessor is unable to deliver to Lessee possession of the Premises in
substantially complete condition on January 1, 2002, rent shall
abate until Lessor is able to deliver to Lessee possession of the Premises in
substantially complete condition.


IV.           For
purposes of this Lease, the term “substantially complete condition” shall mean
that Lessor has completed the improvements in accordance with the plans set
forth in the Addendum, with the exception of minor punch-list items, and has
received a certificate of occupancy for the Premises.


V.            Should
the Commencement Date be other than the first day of a month, rent shall be
prorated for such month based upon the date Lessor deliver possession of the
Premises to Lessee.


VI.           Lessee’s
square footage has been calculated using the architect’s estimates of what the
size will be when built.  Lessor and
Lessee agree to measure the “as-built” space during or after construction when
the fixed demising walls are in place. 
In the event there is a change in the size of the suite from the plans
to the “as-built” space, Lessor and Lessee agree to amend the Lease consistent
therewith, including any change in the amount of rent resulting from the change
in size.


ARTICLE III


Section 3.1             Base
Rental.  Lessee agrees to pay Lessor
at 6322 South 3000 East, Suite #120 Salt Lake City, Utah 84121 or such other
place as the Lessor may from time to time designate, an annual rental for the
use of the Premises in the amount of $24,000.00 (the “Base Rental”),
payable in equal monthly installments $2,000.00 each, the monthly
installments of rental to be paid in advance, without demand, deduction or
offset, on the first day of each and every calendar month during the term
hereof (the “Due Date”).  Rental
payments shall commence on the 1st day of January, 2003, or on
the date the Lessee occupies the Premises, whichever occurs first.  If such commencement day for the payment of
rentals occurs on a day other than the first day of a calendar month, Lessee
shall pay rent for the fractional calendar month involved on a per diem basis
(calculated on the basis of a thirty (30) day month).


Section 3.2             Late
Charge and Interest.  Lessee
acknowledges that late payment by Lessee to Lessor of rent will cause Lessor to
incur costs not contemplated by this Lease, the exact amount of such costs
being extremely difficult and impracticable to fix.  Such costs include, without limitation, processing and accounting
charges and late charges that may be imposed on Lessor by the terms of any
encumbrance and note secured by any encumbrance covering the Premises.  Therefore, if any installment or rent due
from Lessee is not received by Lessor within five (5) days following the Due
Date, Lessee shall pay to Lessor an additional sum of five percent (5%) of the
overdue rent as a late charge.  The
parties agree that this late charge represents a fair and reasonable estimate
of the costs that Lessor will incur by reason of late payment by Lessee.  Acceptance of any late charge shall not
constitute a waiver of Lessee’s default with respect to the overdue amount or
prevent Lessor from exercising any of the other rights and remedies available
to Lessor.


 


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Rent not paid when due also shall bear interest at the rate of twelve
percent (12%) per annum from the Due Date until paid.  Any late charge also shall bear interest at the rate set forth
above, commencing five (5) days following the Due Date.


Section 3.3             Returned
Checks.  In the event a check comes
back due to insufficient funds, a service charge of $25 will be assessed to the
Lessee.


[Sections 3.4, 4.1, 4.2, 4.3, 4.3(A), 4.3(B), 4.3(C), 4.4(A), 4.4(B),
4.4(B)a-k, 4.5, 4.5(A), 4.5(B), 4.5(C), 4.6, and 4.7 appear with
strike-throughs in original document.]


ARTICLE V


Section 5.1             Use.  Lessee shall use the Premises only for general
office purposes and for no other business or purpose, without the prior
written consent of Lessor.


Section 5.2             Building
Rules.  Attached hereto are the
rules and regulations relating to the Premises and the entire Property of which
the Premises are a part.  Lessor shall
have the right, at any time or times hereafter, to adopt other or additional
rules and regulations, and to rescind or amend all 


 


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or any o the attached rules and regulations or of
amendments to any of the rules and regulations attached.  The Lessee shall faithfully observe and
strictly comply with and abide by all such rules and regulations from time to
time in force and shall cause Lessee’ employees, guests and invitees to observe
and comply with the same.


(a)           Section VIII
of Building Rules states that, in compliance with the Utah Clean Air Act, it is
our policy to have tenants refrain from smoking in the buildings.


(b)           Section IX
of Building Rules states that chair mats are required under all rolling chairs.


Section 5.3             Use
Prohibited.  Lessee shall not do or
permit anything to be done in or about the Premises nor bring or keep anything
therein which will in any way increase the rate of or affect any fire or other
insurance upon the Building or any of its contents, or cause a cancellation or
any insurance policy covering said Building or contents.  Lessee shall not do or permit anything to be
done in or about the Premises which will in any way obstruct or interfere with
the rights of other tenants or occupants of the Building or injure or annoy
them, or use or allow the Premises to be used for any immoral, unlawful or
objectionable purpose, nor shall Lessee cause, maintain or permit any nuisance
in, or about the Premises.  No loud
speakers or other similar device, system or apparatus which can be heard or
experienced outside the Premises shall, without the prior written approval of
Lessor, be use in or at the Premises. 
Lessee shall not commit or suffer to be committed any waste in or upon
the Premises.  The provision of this
Section 5.3 are for the benefit of Lessor only and are not nor shall they
be construed to be for the benefit of any tenant or occupant of the Building.


ARTICLE VI


Section 6.1             Utilities.  Lessor agrees to furnish reasonable amounts
of heat and air conditioning during generally recognized business hours and
during the usual and appropriate season, and to furnish electricity and water
in reasonable amounts; but Lessor shall not be liable for any loss or damage
caused by or resulting from any variation, interruption or failure of such
services due to any cause other than the gross negligence or willful misconduct
of Lessor; and no temporary interruption or failure of such services incident
to the making of repairs, alterations or improvements or due to accidents or
strikes or conditions or events not under Lessor’s control shall be deemed as
an eviction of Lessee or relieve Lessee from any of Lessee’s obligations
hereunder.  If there are separate
utility meters for the Premises, Lessee will pay all costs associated with said
utility meters.  If there are not
separate utility meters, Lessee will pay their proportionate share of the
associated utility costs.


Section 6.2             Excess
Consumption of Utilities.  Lessee
must have prior written consent of the Lessor to add any equipment to, or in
any other way make use of, the Premises which may cause or result in a larger
than normal use of heat, air conditioning, electricity, gas, water, sewer,
refuse removal or other services.  In
the event Lessor consents to the installation of such equipment, or such use,
Lessor may assess the estimated additional expense to the Lessee and Lessee
shall pay said amount at the same time he pays his monthly rental installment.


 


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Section 6.3             Janitorial
and Other Services.  Lessor agrees
to supply janitorial service for all interior and exterior common areas.  Lessor shall provide janitorial
service for the interior portion of the leased unit.  If Lessee requires janitorial services above and beyond services
required for a standard, 40-hour-work-week tenant, Lessee shall be
responsible for all associated additional costs.


(a)           Janitorial
service includes vacuuming and dumping of trash cans.


(b)           Lessee
shall be responsible for carpet cleaning, blind cleaning, window cleaning and,
when applicable, stripping and waxing of floors.


(c)           Lessor
shall be responsible for normal repairs to the basic plumbing, heating, air
conditioning and electrical systems.


(d)           Lessor
shall be responsible for the purchase, replacement, and installation of all
light bulbs within leased premises.


(e)           In
the event of negligence or willful destruction by Lessee or Lessee’s clients,
Lessee shall be responsible for plumbing and electrical repairs, the
replacement of carpets, draperies, wall coverings, floor tile, light fixtures
and related attachments, and any other hardware items within the Premises.


(f)            Lessee
further agrees that any redecorating done during the term of this Lease shall
be at the expense of Lessee.


ARTICLE VII


Section 7.1             Right
of Entry.  Lessor shall have the
right of access to the Premises at all reasonable times for the purposes of,
including, without limitation, inspecting, cleaning and repairing the same, or
to exhibit the Premises at any time before the expiration of this Lease.


Section 7.2             Maintenance
and Repair.  Lessee shall maintain
and repair the interior of the Premises in the same condition as delivered to
it, ordinary wear and tear excepted. 
Lessee shall not damage or destroy the Premises.  In the event Lessee shall fail to comply
with its obligations hereunder, Lessor shall have the right to enter onto the
Premises and effect such repair and maintenance and charge the costs thereof to
the Lessee together with twelve percent (12%) interest per annum on the costs
so expended, said amounts to be considered as additional rent hereunder.


Section 7.3             Improvements.  Lessee hereby accepts the Premises in its
present condition without any obligation upon Lessor to make any repairs or
restoration thereto except as provided on Addendum “A” attached hereto and made
a part hereof.  It is further agreed
that this Lease is made by the Lessor and accepted by the Lessee under the
distinct understanding and agreement that the Lessor shall have the right and
privilege to make and build additions to the Building as it may deem wise and
advisable without any liability to the Lessee therefor.


 


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(a)           Lessee
shall not make any alterations, additions or improvements in or to the Premises
without first obtaining the prior written consent of Lessor.  Lessee hereby waives all rights to make
repairs at the expense of Lessor as provided by any law or statute or ordinance
now or hereafter in effect.


(b)           All
alterations, additions of improvements to the Premises, installed at the
expense of Lessor or Lessee, except movable office furniture, Lessee’s trade
fixtures and equipment, shall, unless Lessor elects otherwise in writing,
become the building of Lessor upon the installation thereof, and shall be
surrendered with the Premises at the expiration or termination of this Lease.


Section 7.4             Liens.  Lessee shall not permit any mechanics’,
materialmen’s or other liens arising out of work performed by Lessee or on
Lessee’s behalf, to be filed against the building, the Building, or the
Premises, nor against Lessee’s leasehold interest in the Premises.  Lessor shall have the right at all
reasonable times to post and keep posted on the Premises any notices which it
deems necessary for protection from such liens.  If any such liens are so filed, Lessor may, upon thirty (30) days
written notice to Lessee, without waiving its rights based on such breach by
Lessee and without releasing Lessee from any obligations, pay and satisfy the
same and in such event the sums so paid by Lessor, with interest at the rate of
twelve percent (12%) per annum from the date of payment, shall be due and
payable by Lessee at once without notice or demand.


Section 7.5             Taxes.  Lessee agrees to pay, before delinquency,
any and all taxes levied or assessed and which become payable during the term
hereof upon Lessee’s equipment, furniture, fixtures, and other personal
property located in the Premises, including carpeting installed by Lessee even
though said carpeting has become a part of the Premises; and any and all taxes
or increases therein levied or assessed on Lessor or Lessee by virtue of
alterations, additions, or improvements to the Premises made by Lessee.  In the event said taxes are charged to or
paid or payable to Lessor, Lessee, forthwith upon demand therefor, shall
reimburse Lessor for all of such taxes paid by Lessor.  Any taxes paid by Lessor on behalf of Lessee
shall bear interest at the annual rate of twelve percent (12%) per annum from
the date of payment by Lessor thereof.


ARTICLE VIII


Section 8.1             Damage
or Destruction.  If the Premises or
the Building shall be damaged by fire or other casualty, the damage (exclusive
of any improvements or other changes made to the Premises and paid for by
Lessee), may, at the option of Lessor, be repaired by and at the expense of
Lessor to as near condition which existed immediately prior to such damage or
destruction as reasonably possible; provided, however, that if as a result of
damage by fire or other casualty more than fifty percent (50%) of the net
rental area of the Building is rendered untenantable, then and in such even
either Lessor or Lessee shall have the right and option (exercised, if at all,
by giving written notice to the other party within thirty (30) days of such
destruction or casualty) to terminate this Lease as of the date of such
casualty.  Subject to the foregoing, the
Lessor shall commence such repair within sixty (60) days after such casualty
and shall complete the same within a reasonable time thereafter, subject to
acts of God, strikes and other occurrence not within the control of
Lessor.  In the event Lessor fails to
commence such repair or restoration within such period or shall fail to 


 


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prosecute
such repair and restoration in a timely manner, then Lessee shall have the
right and option (exercised, if at all, by giving written notice within fifteen
(15) days of such failure) to terminate this Lease.  In the event this Lease is terminated for any of the reasons
aforesaid, any rents or other payments shall be prorated as of the effective
date of such termination and proportionately refunded to the Lessee or paid to
Lessor as the case may be.  During any
period in time which the Premises or any portion thereof is rendered untenantable
by fire or other casualty, the rent shall abate proportionately to the area
rendered untenantable for the period of time during which this condition
exists.


Section 8.2             Eminent
Domain.  If all or any part of the
Premises are taken by any public or quasi-public authority under the power of
eminent domain, or conveyed to such authority in lieu of such condemnation,
then either party, at its option, shall have the right to terminate this Lease
as of the day possession shall be taken by such authority.  If, as a result of any such taking, or conveyance
in lieu of condemnation, more than fifty percent (50%) of the net rentable area
of the Building is rendered untenantable, then the Lessor shall have the right
and option (exercised, if at all, by giving written notice within thirty (30)
days of such taking or conveyance) to terminate this Lease as of the date of
such taking or conveyance.


If all or any part of the Building in which the Premises are located
shall be taken by any such authority, or conveyed in lieu of condemnation, then
Lessor shall have the right and option to terminate this Lease.  In the event this Lease is terminated for
any of the reasons aforesaid, any rents or other payments shall be prorated as
of the effective date of such termination and proportionately refunded to the
Lessee or paid to the Lessor as the case may be, and Lessee shall have no claim
against Lessor for the value of any unexpired term of the Lease.  All damages awarded for such taking under
the power of eminent domain, or conveyance in lieu thereof, shall belong to and
be the building of Lessor irrespective of the basis upon which they were
awarded; provided, however, that Lessee shall be entitled to receive any
damages specifically awarded for its share of moving expenses.


ARTICLE IX


Section 9.1             Multiple
Parties Tenant.  If there is or
comes to be more than one party that constitutes Tenant hereunder
(a) Their obligations shall be joint and several; and (b) Any notice
required or permitted to be given to Tenant may be given by or to any one of
such parties and shall have the same force and effect as if given by or to all
on such parties.


Section 9.2             Assignment.  Lessee may not assign, mortgage, pledge,
hypothecate, or encumber this Lease or sublet the Premises or any part thereof,
nor allow any other person (the agents and servants of Lessee excepted) to
occupy or use the Premises, or any part thereof, or any right or privilege
appurtenant thereto, without first obtaining Lessor’s written consent;
provided, however, if Lessor consents to one or more assignments of this Lease
or consents to the subletting from time to time of the Premises or parts
thereof, the Lessee shall nevertheless remain liable for its performance of
this Lease on its part of be performed, including the payment of the rentals
and other charges assumed by Lessee hereunder. 
Lessor shall not withhold consent unreasonably.


 


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Section 9.3             Subletting.  Notwithstanding anything in Section 9.1
above to the contrary, in the event at any time during the term of this Lease,
Lessee desires to sublet the Premises, Lessor reserves the prior right and
option (a) to require the Lessee to sublet the Premises to a sublessee
approved by Lessor at the same rent as Lessee is required to pay to Lessor
under this Lease; however should Lessee choose to sublease at a reduced rate,
Lessee shall continue to pay to Lessor the full amount due, or (b) to
terminate this Lease.  Lessee shall
notify Lessor in writing not less than sixty (60) days in advance if
Lessee proposes to sublet the Premises, designating the terms of the proposed
subletting.  Lessor shall be allowed
thirty (30) days after receipt of Lessee’s notice within which to approve
the sub-tenant identified in Lessee’s notice. 
In the event lessor approves the sub-tenant identified in Lessee’s
notice, all of the provisions of Section 9.1 above respecting subletting
shall continue to be in full force and effect; and nothing contained in this
Section (9.3) shall be construed as a waiver by Lessor of any of its rights
under Section 9.1 above.


ARTICLE X


Section 10.1           Signs.  The Lessee shall not place or maintain or
permit to be placed or maintained any signs for advertising of any kind
whatsoever on the exterior of the Building or on any exterior windows in the
Building or elsewhere within the Premises so as to be visible from the exterior
of the Building, or on the interior walls, including doorways of the Premises,
so as to be visible from the public hallways or other public areas of the
Building, except such numerals and lettering on doorways as may be approved and
permitted by Lessor in writing.


Section 10.2           Parking.  Lessee shall have the right to use three and
one half (3.5) parking spaces per 1,000 usable square feet.  In the event Lessee regularly uses more
parking spaces, Lessor shall have the right to charge Lessee for such excess
use at the rates specified below. 
Lessor shall have the sole and exclusive right to designate, and from
time to time in its discretion, redesignate, the parking space or spaces
available for the use of Lessee, its employees, its agents, officers and
customers.  Such parking facilities
shall at all times be under the exclusive control and management of Lessor, and
Lessor shall have the right from time to time to establish, modify and enforce
rules and regulations with respect to such parking facilities.  The parking lot may not be used to store
vehicles or to work on vehicles.  No
vehicle shall be parked in the parking lot for more than eighteen (18)
consecutive hours without prior approval from Lessor.  The tenant agrees to assume responsibility for compliance by its
employees with the parking provisions contained herein.  If the Tenant or its employees park in other
than such designated parking areas the Landlord may charge the Tenant, as
additional rent, Ten Dollars ($10.00) per day for each day or partial day each
such vehicle is parked in any part of the parking lot, or in a fire lane or
handicapped area.  Any vehicles parked
in the parking lots in breach of these terms may be towed away at Lessee’s
expense.  Lessee releases, indemnifies
and holds harmless Lessor and Lessor’s officers, employees and agents from any
claims arising from or relating to such towing of vehicles including any
consequential damages or loss of property of loss of the use of the vehicle or
other property.  The right to tow a
vehicle in addition to Lessor’s rights under the Lease for default or breach of
any of the terms hereof.


Other than parking, egress and ingress, Lessee has no right to use the
common areas, and Lessee shall not obstruct the common areas, including the
sidewalks, landscaped areas, paved areas, parking lots, or driveways.


 


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ARTICLE XI


Section 11.1           Breach
or Default.  Lessee shall have
breached this Lease and shall be considered in default hereunder if
(a) Lessee files a petition in bankruptcy or insolvency or for
reorganization under any bankruptcy act, or makes an assignment for the benefit
of creditors; (b) involuntary proceedings are instituted against Lessee
under any bankruptcy act; (c) Lessee assigns this Lease for the benefit of
creditors; (d) Lessee fails to pay any rent when due and does not make the
delinquent payments within five (5) days after receipt of notice thereof from
Lessor; or (e) Lessee fails to perform or comply with any of the covenants
or conditions of this Lease and such failure continues for a period of
thirty (30) days after receipt of notice thereof from Lessor.


Section 11.2           Effect
of Breach or Default.  In the event
of a breach of this Lease as set forth in Section 11.1 above, the rights
of Lessor shall be as follows:


(a)           Lessor
shall have the right to cancel and terminate this Lease, as well as all of the
right, title, and interest of Lessee hereunder, by giving to Lessee not less
than ten (10) days notice of the cancellation and termination.  On expiration of the time fixed in the
notice, this Lease and the right, title and interest of Lessee shall terminate
in the same manner and with the same force and effect, except as to Lessee’s
liability, as of the date fixed in the notice of cancellation and termination
were the end of the term herein originally determined.


(b)           Lessor
may elect, but shall not be obligated, to make any payment required by Lessee
herein or comply with any agreement, term, or condition required hereby to be
performed by Lessee, and Lessor shall have the right to enter the Premises for
the purpose of correcting or remedying such default and to remain until the
default has been corrected, or remedied, but any expenditure for the correction
by Lessor shall not be deemed to waive or release Lessee’s default or Lessor’s
right to take any action as may be otherwise permissible hereunder or under the
law in the case of any default.


(c)           Lessor
may re-enter the Premises immediately and remove the building and personnel of
Lessee, and store the building in a public warehouse or at a place selected by
Lessor, at the expense of lessee.  After
re-entry, Lessor may terminate this Lease on giving ten (10) days written
notice of termination to Lessee. 
Without such notice, re-entry will not terminate this Lease.  On termination, Lessor may recover from
Lessee all damages resulting from the breach, including the cost of recovering
the Premises and the worth of the balance of this Lease over the reasonable
rental value of the Premises for the remainder of the Lease term, which such
sum shall be immediately due Lessor from Lessee.


After re-entry, Lessor may relet the Premises or any part thereof for
any term without terminating this Lease, at the rent and on the terms as Lessor
may choose.  Lessor may make alterations
and repairs to the Premises.  The duties
and liabilities of the parties if the Premises are relet as provided herein
shall be as follows:


(I)            In
addition to Lessee’s liability to Lessor for breach of the Lease, Lessee shall
be liable for all expenses of the reletting, for the alterations and repairs
made, 


 


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and for the difference between the rent received by
Lessor under the new lease agreement and the rent installments that are due for
the same period under this Lease;


(II)           Lessor
shall have the right to apply the rent received from reletting the Premises
(a) to reduce Lessee’s indebtedness to Lessor under this Lease, not
including indebtedness for rent; (b) to expenses of the reletting and
alterations and repairs made; (c) to rent due under this Lease; or
(d) to payment of future rent under this Lease as it becomes due.


If the new lessee does not pay a rent installment promptly
to Lessor, and the rent installment has been credited in advance of payment to
the indebtedness of Lessor as provided herein, and during any rent installment
period, are less than the rent payable for the corresponding installment period
under this Lease, Lessee shall pay Lessor the deficiency, separately for each
rent installment deficiency period and before the end of that period.  Lessor may at any time after a reletting
terminate the Lease for the breach on which Lessor had based the re-entry and
subsequently relet the Premises.


(d)           After
re-entry, Lessor may procure the appointment of a receiver to take possession
and collect rents and profits of Lessee, and, if necessary, to collect the
rents and profits, the receiver may take possession of the personal property
used in the business of Lessee, including inventory, trade fixtures and
furnishing, and use them without compensating Lessee.  Proceedings for appointment of a receiver by Lessor shall not
terminate and forfeit this Lease unless the Lessor has given written notice of
termination to Lessee as provided herein.


(e)           In
addition to the remedies provided in this Section 11.2, the Lessor shall
have all remedies now or hereafter provided by law for the enforcement of the
provisions of this Lease and the Lessor’s rights hereunder.


Section 11.3           Abandonment.  Lessee shall not vacate or abandon the
Premises at any time during the term hereof, and if Lessee shall abandon,
vacant or surrender the Premises, or be dispossessed by process of law, or
otherwise, any personal property belonging to Lessee and left on the Premises
shall be deemed to be abandoned, at the option of Lessor, except such property
as may be mortgaged to Lessor.  However,
Lessee reserves the right to vacate the premises at any time and continue to
pay monthly rental obligation.


Section 11.4           Lessor’s
Lien.  As security for the payment
and performance by the Lessee of all terms, covenants and conditions on the
part of the Lessee to be paid or performed hereunder, the Lessee hereby grants
to the Lessor a security interest in all furniture, equipment, fixtures,
furnishings, and other personal property of the Lessee now or hereafter
situated in the Premises.  During any
time that the Lessee is in default under this Lease, the Lessee shall not have
the right to remove from the Premises any such furniture, equipment, fixtures,
furnishings, or other personal property. 
In the event of any default hereunder by the Lessee, the Lessor shall
have all rights and remedies of a secured party under the Utah Uniform
Commercial Code, as now in force or as hereafter amended.  Such security interest of the Lessor shall
be in addition to any statutory lien or other security interest now or
hereafter exiting.


 


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ARTICLE XII


Section 12.1           Subordination.


(a)           This
Lease, at Lessor’s option, shall be subordinate to any ground lease, mortgage,
deed of trust, or any other hypothecation for security now or hereafter placed
upon the building and to any and all advances made on the security thereof and
to all renewals, modifications, consolidations, replacements and extensions
thereof.  If Lessor or any mortgagee,
trustee, or ground lessor shall elect to have this Lease prior to the lien of a
mortgage, deed of trust or ground lease, and shall give written notice thereof
to Lessee, this Lease shall be deemed prior to any such mortgage, deed of trust
or ground lease or the date of recording thereof.


(b)           Lessee
agrees to execute any documents required to effectuate such subordination or to
make this Lease prior to the lien of any mortgage, deed of trust or ground
lease, as the case may be (including, without limitation, a Subordination,
Non-Disturbance and Attornment Agreement in the standard form used by Lessor’s
lender), and failing to do so within ten (10) days after written demand, does
hereby make, constitute, and irrevocably appoint Lessor as Lessee’s attorney in
fact and in Lessee’s name, place and stead, to do so.  Upon Lessee’s written request to Lessor, Lessor shall request
that it’s lender issue to Lessee a non-disturbance agreement on such lender’s
standard form; provided, however, the failure of such lender to issue such a
non-disturbance agreement shall in no way affect Lessee’s obligations under
this Lease, including this Section 12.1.


Section 12.2           Mortgagee
Protection.


(a)           If,
in connection with obtaining financing for the building or any portion thereof,
Lessor’s lender shall request reasonable modifications to this Lease as a
condition to such financing, Lessee shall not unreasonably withhold, delay or
defer its consent to such modifications, provided such modifications do not
materially adversely affect Lessee’s rights or increase Lessee’s obligations
under this Lease.


(b)           Lessee
agrees to give to any trust deed or mortgage holder (“Holder”).  by prepaid certified mail, return receipt
requested, at the same time as it is given to Lessor, a copy of any notice of
default given to Lessor, provided that prior to such notice Lessee has been
notified, in writing, (by way of notice of assignment of rents and leases, or
otherwise) of the address of such Holder. 
Lessee further agrees that if Lessor shall have failed to cure such
default within the time period provided for in this Lease, then the Holder
shall have an additional thirty (30) days after expiration of such period, or
after receipt of such notice from Lessee (if such notice to the Holder is
required by this section), whichever is last to occur, within which to cure
such default or if such default cannot be cured within that time, then such
additional time as may be necessary to cure such default (including but not
limited to commencement of foreclosure proceedings, if necessary, to effect
such cure), in which event this Lease shall not be terminated.


 


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ARTICLE XIII


Section 13.1           Indemnification.  Lessee agrees to indemnify and save the
Lessor harmless from expenses, actions, costs of actions (including attorneys’
fees), for injury (including death), to any person or persons which may occur
in, on or about the Premises.  Lessee
agrees to pay all sums of money in respect of any labor, services, materials,
supplies or equipment furnished or alleged to have been furnished to Lessee in
or about the Premises which may be secured by any mechanic’s, materialman’s or
other lien against the Premises or the Lessee’s interest therein and will cause
each such lien to be discharged, if filed, provided that Lessee may contest
such lien upon delivery to Lessor of cash or marketable securities having a
face amount not less than one and one-half (1 1/2) times the face amount of any
such lien.  If such lien is reduced to
final judgment, then and in such event Lessee shall forthwith pay and discharge
said judgment.


Section 13.2           Assumption
of Risk.  The Lessee assumes all
risk of damage of Lessee’s property within the Premises which may be caused by
water leakage, fire, windstorm, explosion, falling plaster or other cause, or
by the act or omission of any other tenant in the Building, unless caused by
Lessor’s negligence.


ARTICLE XIV


Section 14.1           Notices.  Any notice given to Lessor shall be in
writing and forwarded to the Lessor at Lessor’s office by registered or
certified mail.  Any notices given to
the Lessee shall be in writing and forwarded to the Lessee at the Premises by
registered or certified mail.  Either
Party may designate another place for service or notices by written direction
served on the other party by registered or certified mail.  Any such notice shall be deemed to have been
received four (4) days after its mailing.


ARTICLE XV


Section 15.1           Relocation
of Premises.  Lessor reserves the
right to relocate the Lessee in substitute Premises of equivalent square
footage and configuration within the building upon sixty (60) days written
notice to Lessee.  If this right is
exercised, Lessor shall, at its own expense, provide Lessee with paint, wall
covering and carpeting at the new location, comparable to those in the original
location, and shall, at Lessor’s own expense, move Lessee’s office furnishing
to the new location.  If the current
rental rate at the new location is less than at the original location, Lessee’s
rent hereunder shall be reduced accordingly. 
However, if the current rental rate at the new location is higher than
at the original location, the Lessee’s rent shall not be increased for the
remainder of the term hereof, except as provided in ARTICLE IV hereof.


 


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ARTICLE XVI


Section 16.1           Notice
of Surrender.  At least ninety (90)
days before the last day of the term hereof, Lessee shall give to Lessor a
written notice of intention to surrender the Premises on that date, but nothing
contained herein shall be construed as an extension of the term hereof or as
consent of Lessor to any holding over by Lessee.


Section 16.2           Surrender
at End of Term.  Upon the expiration
of the term hereof or sooner termination of this Lease, Lessee agrees to
surrender and yield possession of the Premises to the Lessor peacefully and in
good order and condition, subject only to ordinary wear and reasonable use
thereof, and subject to such damage, destruction or condition as Lessee is not
required to restore or remedy under other terms and provisions of this Lease.  Lessee shall promptly surrender all keys for
the Premises to Lessor at the place then fixed for payment of rent and shall
inform Lessor of combinations on any locks and safes on the Premises.  Any property left in the Premises after the
expiration or termination of this Lease shall be deemed to have been abandoned
by Lessee and the building of Lessor to dispose of as Lessor deems
expedient.  Lessee agrees that, if
Lessee does not surrender to Lessor, at the expiration of the term of this
Lease or upon any termination thereof, then Lessee will pay to Lessor all
damages that Lessor may suffer on account of Lessee’s failure to surrender
possession to Lessor, and will indemnify and save Lessor harmless from and
against all claims made by any succeeding lessee of the Premises against Lessor
on account of such delay.


Section 16.3           Surrender
of premises.  The voluntary or other
surrender of this Lease by Lessee or a mutual cancellation thereof shall not
work a merger, and, at the option of Lessor, shall terminate all or any
existing subleases or subtenancies, or at the option of Lessor, may operate as
an assignment to Lessor of any or all such subleases or subtenancies.


Section 16.4           Holding
Over.  In the event Lessee, with
Lessor’s consent, remains in possession of the Premises after the expiration of
this Lease and without the execution of a new lease, such tenancy shall be
deemed to be from month to month, subject to all the conditions, provisions and
obligations of this Lease, at a rental equal to the last rental paid under this
Lease, plus annual increases as more particularly set forth in ARTICLE IV of
this Lease.


Section 16.5           Quiet
Enjoyment.  The Lessor covenants and
agrees with Lessee that upon Lessee paying said rent and other charges and
performing all of the covenants and provisions aforesaid on Lessee’s part to be
observed and performed, the Lessee shall and may peaceably and quietly have,
hold and enjoy the Premises in accordance with this Lease.


Section 16.6           Light
and Air.  Lessee covenants and
agrees that no diminution of light, air or view by any structure which may
hereafter be erected (whether or not by Lessor) shall entitle Lessee to any
reduction of rent hereunder, result in any liability of Lessor to Lessee, or in
any other way affect this Lease.


 


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ARTICLE XVII


Section 17.1           Insurance.  Lessee agrees to keep in force during the
term hereof, at Lessee’s expense, public liability insurance with limits in the
amount of $1,000,000 for injuries to or death of persons occurring on or about
the Premises and property damage insurance with limits of $500,000.  The limit of any such insurance shall not
however, limit the liability of Lessee hereunder.  Said policy shall name Lessor as an additional insured, and shall
insure Lessor against liability as respects acts, or omissions of Lessee; shall
be issued by an insurance company licensed to do business in the State of Utah;
and shall provide that said insurance shall not be canceled unless ten (10)
days prior written notice to Lessor is first given.  Insurance required hereunder shall be in companies holding a
“General Policyholders Rating” of at least B plus, or such other rating as may
be required by a lender having a lien on the Premises, as set forth in the most
current issue of “Best’s Insurance Guide”.


Said policy or a certificate thereof shall be delivered to lessor by
lessee upon commencement of the term and upon such renewal of such insurance.


Section 17.2           Subrogation.  As long as their respective insurers so
permit, Lessor and Lessee hereby mutually waive their respective rights of
recovery against each other for any loss insured by fire, extended coverage and
other property insurance policies existing for the benefit of the respective
parties.  Each party shall obtain any
special endorsements, if required by their insurer to evidence compliance with
the aforementioned waiver.


ARTICLE XVIII


Section 18.1           Obedience
to Laws.  Lessee shall, at Lessee’s
sole cost and expense, promptly comply with all statutes, ordinances, rules,
orders, regulations and/or requirements of all county, municipal, state,
federal, and other applicable governmental authorities now in force, or which
may hereinafter be in force, pertaining to the Premises.  Lessee shall not use or permit anything to
be done in or about the Premises which will in any way conflict with any
statutes, ordinances, rules, orders, regulations and/or requirements of all
county, municipal, state, federal, and other applicable governmental
authorities now in force, or which may hereinafter be in force.


Section 18.2           Governing
Law.  This Lease shall be construed
and governed by the laws of the State of Utah. 
Should any provision of this Lease be illegal or not enforceable under
such laws, it or they shall be considered severable and this Lease and its
conditions shall remain in force and be binding upon the parties as though the
said provisions had never been included.


Section 18.3           Waiver
of liability.  Lessor shall not be
liable to Lessee, or those claiming through or under Lessee, for injury, death
or property damage occurring in, on or about the Building and appurtenances
thereto, and Lessee shall indemnify Lessor and hold it harmless from any claim
arising out of any injury, death or property damage occurring in, on or about
the Premises to Lessee or any employee, customer or invitees of Lessee.


Section 18.4           Time.  Time is of the essence of this Lease and
each and all of its provisions.


 


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Section 18.5           Attorneys’
Fees.  If either Lessor or Lessee
shall obtain legal counsel or bring an action against the other by reason of
the breach of any covenant, warranty or condition hereof, or otherwise arising
out of this Lease the unsuccessful party shall pay to the prevailing party
reasonable attorneys’ fees, which shall be payable whether or not any action is
prosecuted to judgment.  The term
“prevailing party” shall include, without limitation, a party who obtains legal
counsel or brings an action against the other by reason of the other’s breach
or default and obtains substantially the relief sought, whether by compromise,
settlement or judgment.


Section 18.6           Waiver.  No waiver of any condition or covenant of
this Lease by Lessor shall be deemed to imply or constitute a further waiver by
Lessor of any other condition of this Lease. 
The rights and remedies created by this Lease are cumulative and the use
of one remedy shall not be taken to exclude or waive the right to the use of
another.


Section 18.7           Severability.  If any provision of this Lease or the
application thereof to any person or circumstance shall be invalid or
unenforceable to any extent, the remainder of this Lease and the application of
such provisions to other persons or circumstances shall not be affected thereby
and shall be enforced to the greatest extent permitted by law.


Section 18.8           Addenda.  Clauses, additional conditions, plats and
riders, if any, signed by Lessor and Lessee and endorsed on or affixed to this
Lease are a part hereof, and in the event of variation or discrepancy the duplicate
original hereof, including such clauses, additional conditions, plats and
riders, if any, held by Lessor shall control.


Section 18.9           Entire
Agreement.  This Lease constitutes
the entire agreement between Lessor and Lessee and no representations, express
or implied, either written or oral, not herein set forth shall be binding upon
and inure to the benefit of Lessor or Lessee. 
This Lease shall not be modified by any oral agreement, either express
or implied, and all modifications shall be in writing and signed by both Lessor
and Lessee.  No surrender of the
Premises, or of the remainder of the term of this Lease shall be valid unless
accepted by Lessor in writing.


Section 18.10         No
Waiver.  Failure of Lessor to
insist, in any one or more instances, upon strict performance of any term,
covenant, or condition of this Lease, or to exercise any option herein
contained, shall not be construed as a waiver or relinquishment for the future
of such term, covenant, condition or option, but the same shall continue and
remain in full force and effect.  The
receipt by Lessor of rents with knowledge of a breach in any of the terms,
covenants or conditions of this Lease to be kept or performed by Lessee shall
not be deemed a waiver of such breach and Lessor shall not be deemed to have
waived any provisions of this Lease unless expressed in writing and signed by
Lessor.


Section 18.11         Heirs
and Assigns.  This Lease and all
provisions, covenants and conditions thereof shall be binding upon and inure to
the benefit to the heirs, legal representatives, successors and assigns of the
parties hereto, except that no person, firm, corporation or court officer
holding under or through Lessee in violation of any of the terms, provisions or
conditions of this Lease shall have any right, interest or equity in or to this
Lease, the terms of this Lease or the Premises covered by this Lease.


 


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Section 18.12         Sale
by Lessor.  In the event of a sale
or conveyance by Lessor of the Building, the same shall operate to release
Lessor from any future liability upon any of the covenants or conditions,
express or implied, herein contained in favor of Lessee, and in such event
Lessee agrees to look solely to the responsibility of the successor in interest
of Lessor in and to this Lease.  If any
security be given by Lessee to secure the faithful performance of all or any of
the covenants of this Lease on the part of Lessee, Lessor may transfer and/or
deliver the security, as such, to the successor in interest of Lessor, and
thereupon Lessor shall be discharged from any further liability in reference
thereto.  Except as set forth in this
Section 18.12 this Lease shall not be affected by any such sale or conveyance.


Section 18.13         Estoppel
Certificates.  At any time and from
time to time, upon not less than ten (10) days prior to request by Lessor,
Lessee shall execute, acknowledge and deliver to Lessor a statement certifying
the date of commencement of this Lease, stating without limitation that (a) this
Lease is unmodified and in full force and effect (or if there have been
modifications, that this Lease is in full force and effect as modified and the
date and nature of such modifications); (b) the dates to which the rent has
been paid; (c) Lessee has no claims against Lessor, (d) neither Lessor nor
Lessee is in default under this Lease; and (e) setting forth such other matters
as may reasonably be requested by Lessor. 
Lessor and Lessee intend that by such statement delivered pursuant to
this Section 18.13 may be relied upon any mortgagee or the beneficiary of
any Deed of Trust or by any purchaser as prospective purchaser of the Building.


Section 18.14         Defined
Terms:  Headings.  The words “Lessor” and “Lessee” as used
herein shall include the plural as well as the singular.  Words used in masculine gender include the
feminine and neuter.  If there be more
than one Lessee, the obligation hereunder imposed upon Lessee shall be joint
and several.  The headings to the
paragraphs of this Lease are not a part of this Lease and shall have no effect
upon the construction or interpretation of any part hereof.


IN WITNESS WHEREOF, the parties hereto have executed this Lease as of
the day and year first above written.


	
  LESSOR:  HOLLADAY BUILDING EAST L.L.C.

  	
   

  	
   

  	
  LESSEE:  OVERSTOCK.COM

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By and through its
  Manager Holladay Building East Management Corporation

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Jeff Peck

  	
   

  	
  By:

  	
  /s/ Doug Greene

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Its:

  	
  Vice President

  	
   

  	
   

  	
  Its:

  	
  Doug Greene

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  CTO

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  (Please print
  signature)

  



 


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ADDENDUM A


TENANT
IMPROVEMENTS:


Lessee accepts the
Premises in “as is” condition.  Any
additional tenant improvements shall be at the sole expense of Lessee and must
be pre-approved by Lessor.


SIGNAGE:


Lessee shall have the
option to install its name on the Property monument sign located at the
entrance of the property, the building lobby directory, and by Lessee’s main
suite door entrance.  All signage shall
conform to the building shall be at Lessee’s expense.


SECURITY
ACCESS CARDS:


Lessor shall provide
Lessee with the first 10 (ten) security access cards, for Lessee and its
employees, at no cost to Lessee.  Should
Lessee or its employees lose said access cards or should Lessee require
additional access cards, Lessee shall be responsible for the replacements cost
(approximately $11.00 each access card).


BROKERAGE:


Lessor and Lessee warrant
and represent that they have had no dealings with any outside real estate
broker or agent, and know of no one who is entitled to a commission for this
Lease.


FREE
RENT:


Lessor shall provide
Lessee with 12 (twelve) months of free rent (January 1, 2002 through
December 31, 2002).


 


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OLD MILL CORPORATE
CENTER


BUILDING RULES


I.              RENT


A.            Rent is due on the first (1st) of the month.


B.            Rent shall be paid to Beckstrand and Associates at P.O.
Box 712320, Salt Lake City, UT 84171-2320.


C.            Checks returned due to insufficient funds will be
assessed a $25 service fee.


II.            PROPERTY MANAGEMENT


A.            Old Mill Corporate Center is owned by Holladay Building
East L.L.C. (“Landlord”).


B.            Beckstrand & Associates is the Property Management
Company (“Property Manager”).  Should
you have any maintenance questions or concerns please call (801) 944-7722 and
give the information to whomever answers the phone and the message will be
relayed.


C.            In the event of an emergency after hours, please call
801-267-2054, which is a digital pager. 
Please reserve calls regarding normal repairs to the Property Manager’s
normal business hours, M-F 8:00 am — 5:00 pm.


III.           SIGNS


A.            Standard signs must be used on all office doors and
entrances.  The Property Manager will
order signs and bill the tenant for the purchase price.


B.            All signs are the property of the building and are not to
be removed without the express approval of the Landlord.


IV.           PARKING


A.            In order to leave the most convenient space for
customer’s parking, tenants and their employees are not to park directly in
front of the building or in reserved visitor parking stalls.


B.            Please refrain from parking in the spaces reserved for
the handicapped.  Unauthorized vehicles
parked in these spaces will be towed away at the owner’s expense.


C.            Vehicles should not be left in the parking lot
overnight.  Any vehicle left overnight
without prior consent will be towed away at the owner’s expense.


 


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D.            Any vehicle parked on the premises for the purpose of
selling that vehicle will be towed away at the owner’s expense.


E.             The storage, repairs, or cleaning of vehicles will not
be permitted on the premises.


V.            SECURITY


A.            There is a “No Soliciting” sign posted on the
building.  Please notify the Property
Manager if there is any soliciting on the premises.


B.            The distribution or posting of handbills on the premises
is expressly prohibited.  We would
appreciate being notified if handbills are distributed or posted.


C.            All buildings are equipped with fire extinguishers.  Please familiarize yourself with the
location of them.


D.            When you leave at the end of the day please make sure
that all windows are closed and that all doors are locked.


E.             Please make sure you turn off your coffee makers and
misc. equipment each night to prevent fire. 
We strongly recommend that all coffee makers be equipped with an
automatic shutoff.


VI.           TRASH DISPOSAL


A.            Tenant may utilize available dumpsters for office trash
can waste only.  Packing skids, boxes,
or garbage from the office or home are not to be placed in or around dumpsters,
Landlord reserves the right to bill Tenant for extra trash pick-ups as a
result.  It is the sole responsibility
of the Tenant to dispose of excessive trash and packaging material somewhere
else.


VII.         SMOKING


A.            Due to the Utah Clean Air Act, tenants must refrain from
smoking in the building, or within 25 feet of the building.  Smoking is permitted only in the designated
smoking area(s) for the building.


VIII.        MISCELLANEOUS


A.            Chair mats are required under all rolling chairs to
protect the carpet.


B.            Any burning of candles is prohibited.


IX.           SECURITY ACCESS CARD


A.            Upon request from Tenant’s authorized representative,
security access cards will be individually programmed and given to Tenant and
its employees.  Tenant will be charged
$11.00 for each lost card or card that is not returned to Landlord.


 


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X.            REKEYING


A.            Tenant must obtain Landlord’s permission before rekeying
any lock(s).  Rekeying of locks shall be
to the building’s grand master system. 
Rekeying of locks will be at the expense of the Tenant.  Landlord reserves the right to rekey the
Premises and bill Tenant if Tenant rekeys lock(s) without Landlord’s consent,
or off of building’s grand master system.


XI.           ANIMALS, REFUSE


A.            Tenants shall not allow anything to be placed on the
window of the Premises or to be thrown out of any outside opening of the
Building.  Tenants shall not place or
permit to be placed any obstruction of refuse in any public part of the
Building.


B.            No animal shall be brought into the office, halls,
corridors, elevators or any other part of the Building by Tenants or the
agents, employees or invitees of the Tenants.


XII.         INVOICING


A.            Landlord does not invoice for monthly rents.  Tenant is responsible for keeping track of
annual increases.  As files are audited,
Tenant may be notified as a courtesy, but Landlord is not obligated to do so.


 


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