Document:

Memorandum of Agreement

     

      
        

      

    

    
      EXHIBIT
        10.2

      

      MEMORANDUM
        OF AGREEMENT 

       

      This
        Memorandum of Agreement is dated the 30th day of August, 2006 and is entered
        into between CLEARONE
        COMMUNICATIONS, INC.,
        a Utah
        corporation (the “Company”), and KEN-A-VISION
        MFG. CO., INC.,
        a
        Missouri corporation (the “Buyer”), who agree as follows:

      

      WHEREAS,
        the
        Company and the Buyer have entered into that certain Asset Purchase Agreement
        dated August 23, 2006 (the “APA”); and 

      

      WHEREAS,
        a
        dispute has arisen at the Closing contemplated in the APA as to the amount
        of
        the Purchase Price (as defined in the APA); and 

      

      WHEREAS,
        the
        Company and the Buyer wish to amend certain provisions of the APA as described
        below, capitalized terms not otherwise defined herein having the meanings
        ascribed thereto in the APA. 

      

      NOW
        THEREFORE,
        for
        good and valuable consideration, the receipt and sufficiency of which is
        hereby
        acknowledged by each of the Company and the Buyer; the parties hereto agree
        as
        follows: 

      

      1. Adjustment
        in Purchase Price.
        The APA
        is hereby amended to change the Purchase price to $635,000. 

      

      2. The
        Down Payment.
        The APA
        is hereby amended to change the amount of the Down Payment to $317,500.

      

      3. The
        Note.
        The APA
        is hereby amended to change the amount of the Note to $317,500, to change
        the
        amount of the monthly payment under the Note to $14,360.00 and the date of
        the
        first payment due under the Note is changed to October 1, 2006. 

      

      4. Waiver
        of Conditions.
        Buyer
        waives the assignment to Buyer of the NeoSci agreement and the T2 supply
        agreement. Furthermore, each party hereto agrees to cooperate in the preparation
        and delivery following Closing of a Form 8594 in respect of the sale and.
        purchase of the Assets. 

      

      5. The
        APA
        remains unamended except as set forth above. 

       

      IN
        WITNESS WHEREOF, the Company and the Buyer have each executed this Memorandum
        of
        Agreement this 30th day of August, 2006. 

       

      

        
          	
                  CLEARONE
                    COMMUNICATIONS, INC.

                   

                   

                  Per:
                    /s/
                    Craig E. Peeples

                	
                  KEN-A-VISION
                    MFG. CO., INC.

                   

                   

                  Per:
                    /s/
                    Steven M.
                    DunnLease Agreement

    
      

    

    EXHIBIT
      10.3

    

    LEASE
      AGREEMENT

    

    

    This
      Lease made and entered into this ___ Day of SEPTEMBER,
      2006 by
      and between ALDER CONSTRUCTION COMPANY, hereinafter referred to as Lessor,
      and
CLEAR
      ONE INC
      hereinafter referred to as Lessee.

    

    

    WITNESSETH:

    

    Whereas
      Lessor desires to let and the Lessee desired to take and occupy those certain
      premises in Salt Lake County; State of Utah known as:

    

    2740
      W California Ave Suite#5

    SLC
      UT 84104

    Consisting
      of:

    15,635
      Sq. Ft. of Warehouse plus 1,420 Sq. Ft. of Office w/mezzanine
      above.

    

    Lessor
      grants to Lessee an option to extend the lease for 2 years at
      $7,500.00/month.

    

    Lessor
      agrees to warrant that all functions of the facility (i.e. power, light
      fixtures, HVAC system, unit heaters, etc.) are in proper working condition
      for
      one (1) year.

    

    Lessor
      will sweep clean the warehouse and clean the office windows inside and
      outside.

    

    Rent
      commences on December 1, 2006. September thru November Rent will be free to
      offset move in costs.

    

    Security
      Deposit of $7,000.00 is due upon signing of lease agreement and is never to
      be
      considered as last months rent.

    

    TERMS:

    

    The
      parties hereby covenant and agree that this lease will become effective:
September
      15, 2006 and continue for a period of 37 months through October 15, 2009. Tenant
      may cancel this lease after 18 months if Lessor receives a prior 6 months
      written notice. Lessor will keep the security deposit if this clause is
      exercised. 

     

    RENTAL:

    

    Lessee
      shall pay to Lessor, or its order, in Salt Lake City, Utah $7,000.00*
      per
      month, in Advance for each month. Payments received after the fifteenth day
      of
      the month shall include a 5% late charge. *Year
      2 is $7150.00/month & year 3 is $7300.00/month

    
      
        
        

      

      
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    USE
      OF PREMISES:

    

    It
      is
      understood and agreed that the premises herein let shall be used by the Lessee
      for the operation and conduct of warehouse and office use and any other lawful
      related respective interests are concerned, that business shall be conducted
      in
      accordance with all laws, rules, regulations, requirements and ordinances
      enacted or imposed by any governmental unit having jurisdiction over Tenant
      or
      Tenants’ business and only for the Permitted Use. Tenant shall not use or occupy
      the Lease premises nor permit the use or occupancy for any unlawful use or
      purpose.

    

    a) During
      the term of this Lease including all renewals or extensions thereto, both
      Landlord and Tenant agree to comply with all federal, state and local statutes,
      regulations, executive orders and ordinances concerned with the emission, spill,
      release, discharge or disposal of any hazardous or solid waste treatment,
      storage or disposal system servicing the Lease Premises (collectively
      Environmental Law”) respectively applicable to each.

    

    b) Landlord
      represents and warrants to Tenant that (1) it has not received any notice of
      any
      alleged violation of the Leased Premises of any Environmental Laws; and (2)
      to
      the best of Landlords’ knowledge, information and belief with respect to the
      Leased Premises and the Building, there are no violation of any Environmental
      Laws, Landlord and Tenant shall promptly notify the other of any discussions
      between it or its agents, employees or attorneys and any federal, state or
      local
      officials concerning any alleged violation at the Leased Premises or the
      Building of any Environmental Laws.

    

    c) In
      event
      either Landlord or Tenant fails to comply with any Environmental Laws applicable
      to it, or with any order or judgment issued against it for failure to comply
      with such right, but not the obligation, to enter the Leased Premises and take
      such actions as deemed reasonably necessary to comply with any statute,
      regulation, executive order, ordinance, order or judgment or protect the Leased
      Premises; provided, however, neither Landlord nor Tenant shall have the right
      to
      take any actions specified in this Section while the alleged violator is
      involved in good faith negotiations with any federal, state or local officials
      concerning any environmental obligation it may have at the Lease
      Premise.

    

    d) Nothing
      in this Section shall be used to prevent Tenant from storing on or about, and
      transporting from the Lease Premises any Hazardous Substance utilized by Tenant
      in the conduct of its normal business activity. As used in this Section,
“hazardous substance” shall be defined as any Environmental Response,
      Compensation and Liability Act, as amended, 42 W.S.C. Section 9601,et. Seq.;
      the
      Resource Conservation and Recovery Act, as amended 42U.S.C. Section 9601,et.
      Seq.; The Federal Water Pollution Control Act, as amended 33 U.S.C. Section
      1251, et. Seq.; The Federal Air Pollution Prevention and Control Act (the “Clean
      Air Act”), as amended 42 U.S.C. Section 7410 et. Seq.; any rules or regulations
      promulgated thereunder; or any other applicable federal, state or local statute,
      regulation or commercial product which through its use becomes a hazardous
      substance.

    

    e) Landlord
      and Tenant each agree to indemnify and hold harmless the other from and against
      any all liabilities, damages, judgments, causes of action, claims and expenses
      which may be incurred by Landlord or Tenant, as the case may be, relating to
      or
      arising out of any breach of the covenants set forth in the subsections (a)
      through (e) hereof.

    
      
        
        

      

      
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    UTILITIES:

    

      Lessor
      shall
      not
      (shall,
      shall not) pay for Electric Power and Natural Gas Service. Lessor shall
      (shall,
      shall not) pay for Building Water and Sewer Charges.

    

    TAXES:

    

    Lessor
      shall
      (shall,
      shall not) be responsible for and pay all real property taxes presently levied
      upon said building. Lessee shall be responsible for any increases in property
      taxes assessed after 2006
      Pro-Rated Basis.
      Lessee
      shall be responsible for taxes levied upon the business and for any taxes levied
      upon personal property in or upon said premises belonging to
      Lessee.

    

    MAINTENANCE:

    

    Lessee
      shall promptly make all repairs necessary to maintain the premises and building
      in as good order and repair as when delivered to it. Allowing for reasonable
      use; provided that exterior and structural repairs and repairs to the roof,
      and
      skylights, repairs to asphalt parking and drives, repairs to all mechanical,
      electrical, and plumbing distribution components of the building, damage by
      fire, the elements, casualty or other cause or happening not due to the
      negligence of the Lessee shall be made by the Lessor. Lessee is responsible
      for
      and agrees to pay for any damage caused by the acts of its agents, customers,
      or
      employees.

    

    Lessee (Lessor,
      Lessee) shall be responsible for janitorial and cleaning services, interior
      maintenance, and waste removal. Lessee agrees to promptly replace all broken
      window glass in the premises with like grade and quality, and shall remove
      snow
      and ice from the sidewalk in front of the premises. Lessor shall
      (shall,
      shall not) clear snow from parking lot area. Lessee or its agents will remove
      litter from parking lot and landscaped area. Routine maintenance and repair
      of
      heating and air conditioning, including bi-annual service checks and normal
      change of furnace filters, shall be the responsibility and be done at the cost
      of the Lessee
      (Lessor,
      Lessee). Lessee shall maintain a preventive maintenance contract to service
      the
      HVAC system including all evaporative cooling units, if any, on a bi-annual
      basis. Lessor will pay and assume all costs of major repairs in excess of Five
      Hundred Dollars ($500.00) per repair, and costs of replacement for HVAC
      equipment only.

    

    Lessee
      agrees to leave the premises in “as delivered” condition upon vacating the
      facility at the conclusion of the lease; normal wear and tear excepted.
“Reasonable use” does not included nail holes in walls, or damage to sheetrock
      walls or doors. Lessee agrees to clean the premises upon vacating and remove
      all
      accumulated dirt and debris from the Leased premises and site, and remove and
      or
      repair any racking fasteners and damage caused to the warehouse floor and
      walls.

    

    Lessor
      does not agree to repair damage caused by Lessee in excess of its reasonable
      use
      of the premises.

    
      
        
        

      

      
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    ALTERATIONS
      AND IMPROVEMENTS:

    

    No
      alterations, changes in, or improvements shall be made to the premises by Lessee
      without the prior consent of the Lessor thereto, which consent shall not be
      unreasonably withheld, conditioned or delayed.

    

    The
      Lessor shall be responsible for improvements to the building or premises to
      comply with future building codes or legislation imposed against said facility.
      Lessee shall be responsible for their specific use of the facility and for
      accommodations required for their specific use of the facility and
      accommodations required for their customers or employees.

    

    KEY:

    

    Any
      changes of keys for their suite must be made only after notice and approval
      of
      Lessor. Changes made without Lessor approval will be re-keyed at Lessees
      expense. Lessee agrees to provide Lessor with two (2) copies of key for any
      lock
      re-keyed.

    

    INSURANCE:

    

    Lessor
      will carry fire insurance on the building, including insurance for glass damage
      caused by fire at Lessors’ expense. Lessee is required to carry fire insurance
      on contents and also third party liability insurance to protect and save
      harmless Lessor from any and all liability arising from conduct of Lessees’
business. Lessor is not responsible for fire rules, regulations and requirements
      of the Board of Fire Underwriters.

    

    The
      Lessor and Lessee hereby waive any rights each may have against the other on
      account of any loss or damage covered by fire and extended coverage insurance
      and the Lessor and Lessee each, on behalf of their insurance companies, waive
      any right of subrogation that they may have against the Lessor or the Lessee.
      Lessee shall be responsible for any increase in the Lessors insurance cost
      incurred after 2006 and for the total cost of any additional insurance requested
      by the Lessee.

    

    Increase
      in risk. The Tenant shall not do or permit to be done any act or thing as a
      result of which (1) Any policy of insurance of any kind covering either any
      or
      all of the Property or covering the Landlord may become void or suspended,
      or
      (2) the insurance risk under any such policy would (in the opinion of the
      insurer thereunder) be made greater. The Tenant shall pay as Additional Rent
      the
      amount of any increase in any premium for such insurance resulting from any
      breach of such covenant, within fifteen (15) days after the Landlord notifies
      the Tenant in writing of such increase.

    

    The
      Tenant shall maintain at its expense, throughout the term, insurance against
      loss or liability in connection with bodily injury, death, property damage
      or
      destruction, occurring within the premises or arising out of the use thereof
      by
      the Tenant or its agents, employees, officers, subtenants, invitees, visitors
      and guests, under one or more policies of Commercial General Liability insurance
      having a combined single limit of not less than One Million Dollars ($1,000,000)
      per occurrence; Two Million Dollars ($2,000,000) aggregate, (which limit if
      such
      policy is carried on a “blanket” basis, shall be written on a per location
      basis).

    
      
        
        

      

      
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    Each
      such
      policy shall (a) name as additional insured with respect to this Lease only
      thereunder the Landlord and the Landlords’ directors, officers, agents, and
      employees (b) by its terms, be considered primary and non-contributory with
      respect to any other insurance carried by the Landlord or its successors and
      assigns, (c) by its terms, be cancelable only on at least thirty (30) days
      prior
      written notice to the Landlord (and, at the Landlords request, any such Senior
      Holder), and (d) be issued by an insurer of recognized responsibility licensed
      to issue such policy in the state which the property is located.

    

    The
      Tenant, at its sole cost and expense, shall also maintain throughout the Term
      a
      policy insuring against damage to or destruction of the Tenant’s leasehold
      improvements, furniture, fixtures, equipment and other personal property
      installed in or otherwise located on the premises.

    

    At
      least
      five (5) days before the Commencement Date, the Tenant shall deliver to the
      Landlord an original or a signed duplicate copy of each policy of insurance
      required to be maintained by the Tenant hereunder (certificate evidencing such
      insurance), and at least ten (10) days before any such policy expires, the
      Tenant shall deliver to the Landlord an original or a signed duplicate copy
      of a
      replacement policy therefore (or a certificate evidencing such replacement).
      Pursuant to the above, if a certificate only is presented, the Landlord retains
      the right to request and obtain copy of such policy.

    

    Insurance
      to be maintained by Landlord. The Landlord shall maintain throughout the term,
      All-Risk or Fire and Extended Coverage Insurance upon the building in such
      amounts and with such insurers as the Landlord may elect in its reasonable
      judgment.

    

    Waiver
      of
      subrogation. If either party hereto is entitled to be paid any proceeds under
      any policy or insurance naming such party as an insured, on account of any
      loss
      or damage, (or would be so entitled if such party had maintained the insurance
      coverage it agrees to maintain under this Lease, whether or not so maintained)
      then such party hereby releases the other party hereto, to and only to the
      extent of the amount of such proceeds, from any and all liability for such
      loss
      or damage, notwithstanding that such loss, damage or liability may arise out
      of
      the negligent or intentionally tortuous act or omission of the other party,
      its
      agents or employees/

    

    Liability
      of parties. Except if and to the extent that such party is released from
      liability to the other party hereto pursuant to the provisions of the previous
      paragraph.

    

    The
      Landlord (a) shall be responsible for, and shall defend, indemnify and hold
      harmless the Tenant against and from any and all liability or claim of liability
      arising out of, any injury to or death of any person or damage to any property,
      occurring anywhere upon the property, if, and only if and to the extent that
      such injury to or death of any person or damage is caused solely by the grossly
      negligent or intentionally tortuous act or omission of the Landlord or its
      agents, officers or employees, but (b) shall not be responsible for or be
      obligated to defend, indemnify or hold harmless the Tenant against or from
      any
      liability for any such injury, death or damage occurring anywhere upon the
      property (including the Premises), (1) by reason of the Tenants occupancy or
      use
      of the Premises or any other portion of the property, or (2) because of fire,
      windstorm, act of God or other cause unless caused by such grossly negligent
      or
      intentionally tortuous act or omission of the Landlord; and excluding those
      situations in which the Landlord is obligated to indemnify and hold harmless
      the
      Tenant under the provisions previously stated in this paragraph, the Tenant
      shall be responsible for, and shall defend, indemnify and hold

    

    
      
        
        

      

      
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    harmless
      the Landlord against and from any and all liability, or claim of liability
      arising out of (a) the use or occupancy of, or the conduct, operation or
      management of the Tenants business in, the Premises during the Term, or (b)
      any
      breach or default by the Tenant in performing any of its obligations under
      the
      provisions of this Lease or applicable law, or (c) any negligent, intentionally
      tortuous or other act of omission of the Tenant or any of its agents,
      contractors, servants, employees, subtenants, licensees or invitees during
      the
      Term, or (d) any injury to or death of any person or damage to any property
      occurring on the Premises during the Term.

    

    ABATEMENT
      OF RENT:

    

    If
      said
      building, or any portion thereof, shall be damaged or destroyed by fire,
      rendering said leased portion reasonably unfit for use by Lessee, or if same
      is
      damaged to such extent by other elements or acts of God so that same cannot
      be
      repaired within ninety (90) days from the date of damage or destruction, then
      either party may cancel this agreement by giving written notice of cancellation,
      said cancellation to be effective from date of such damage or destruction.
      In
      the event any such damage or destruction can be repaired or replaced within
      the
      ninety-day period, Lessor shall promptly proceed to repair or replace same.
      Lessee’s rental and other herein specified charges to be paid to Lessor should
      permanently be abated during the period of replacement or repair. However,
      in
      the event Lessee deems a part of its premises to be reasonably usable for the
      conduct of its business, such abatement shall be proportional to the usable
      portion of the premises. It is understood that if any of said repair or
      replacement can be made within a ninety (90) day period and Lessor shall fail
      to
      commence said repair or replacement by thirty (30) days after such damage or
      destruction, the Lessee may commence and finish such replacement or repair
      and
      pay for same and apply such reasonable sum so paid as advance rental hereunder.
      

    

    DEFAULT
      AND ABANDONMENT:

    

    In
      the
      event of failure of payment of monthly rental herein reserved within the time
      specified, or failure to keep or perform any other covenants or agreements,
      after 15 days written notice to Lessee from Lessor, Lessor may re-inter and
      proceed with such legal remedies as it may desire, given it under the terms
      of
      this agreement Lessor may at its option make every reasonable effort to re-let
      the same for the best rent obtainable. If the total amount received by Lessor
      from such re-letting, after deducting the expenses of re-letting and necessary
      repairs does not equal or exceed the unpaid balance of the rent herein provided
      for, Lessee shall pay as damages all such deficiency, or Lessor may at its
      option, declare this agreement void and terminated. Lessor reserves and is
      accorded same rights in the event of abandonment by Lessee.

    

    It
      is
      agreed however, that prior to the exercise by Lessor of any of its rights or
      remedies given for breach of this agreement, except failure to pay rental sums
      when due or within the provided grace period, the Lessor will, in writing,
      specify the breach complained of and accord to Lessee fifteen (15) days from
      date of notice to cure or rectified this agreement shall not be deemed in
      default.

    
      
        
        

      

      
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    OPTION
      TO RENEW: 

    

    Lessor
      hereby grants unto Lessee the first right and option to renew this agreement
      at
      the end of the term herein specified, subject to renegotiating of rent. Lessee
      shall notify Lessor in writing of its intention to renew or not to renew; said
      notice to be mailed ninety (90) days prior to expiration date, and a renewal
      lease shall be negotiated to become effective upon the expiration of this
      lease.

    

    HOLDING
      OVER:

    

    Unless
      Lessor and Lessee otherwise agree in writing, any holdover by Lessee after
      the
      expiration of this lease, or any written extension, shall constitute a tenancy
      from month to month. The lease rate during the hold over period will be at
      the
      then current rate, as determined by Lessor with sufficient information from
      commercial real estate agency, and in accordance with the terms and conditions
      of this lease. 

    

    SUB-LEASE:

    

    Lessee
      shall not sub-lease or transfer any interest under this lease, or sub-let the
      premises or any part thereof, without prior written consent of Lessor, which
      consent will not be reasonably withheld.

    

    ENFORCEMENT:
      

    

    The
      acceptance by Lessor of partial payments of rent due shall not, under any
      circumstance, constitute a waiver of any rights of Lessor at law under this
      lease, nor affect any notice or legal proceedings, theretofore given or
      commenced.

    

    INDEMNITY:
      

    

    Landlord
      agrees to indemnify and hold tenant, its successors and assigns, harmless from
      any claim, obligation, liability, loss, damage, or expense including attorneys
      fees of whatever kind of nature, contingent or otherwise, known or unknown,
      incurred or imposed based upon any provision of federal, state or local law
      or
      regulations, or common law or pertaining to health, safety or environmental
      protection and arising out of the environmental condition of the premises
      existing as of the commencement of the Lease.

    

    Tenant
      agrees to indemnify and hold Landlord, its successors and assigns, harmless
      from
      any claim, obligation, liability, loss, damage or expense, including attorneys
      fees of whatever kind or nature, contingent or otherwise, known or unknown,
      incurred or imposed based upon safety or environmental protection and arising
      out of environmental condition of the Premises arising subsequent to the
      commencement of this Lease and as the operation of Tenant on the lease Premises.
      The phrase “environmental condition” includes the surface or groundwater,
      drinking water supply, land, surface or sub-surface strata and the ambient
      air.

    

    PROPERTY
      OF LEASE: TITLE

    

    At
      all
      times during the term of this lease, Lessee shall retain title to all property
      stored or located in or on the Leased Premises.

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

    

    ENTIRE
      AGREEMENT MODIFICATION AND SEVERABILITY: 

    

    This
      lease contains the entire agreement between the parties and shall not be
      modified in any manner except by an instrument in writing executed by the
      parties if any provision of this lease shall be declared invalid or
      unenforceable, the remainder of the lease shall continue in full force and
      effect.

    

    SUCCESSORS
      IN INTEREST: 

    

    The
      covenants, terms, conditions, provisions and undertakings in this lease or
      any
      renewals thereof shall extend to and be binding upon the heirs, executors,
      administrators, successors, and assigns of the respective parties hereto, as
      if
      they were in every case named and expressed, and should be construed as
      covenants running with the land; wherever reference is made to either of the
      parties hereto, it shall be held to include and apply also to the heirs,
      executors, administrators, successors and assigns of such part, as if in each
      and every case so expressed.

    

    NOTICE:
      The
      addresses given below shall be the addresses designated to receive any notice
      required under this lease. Any notice delivered to this address via U.S. Mail
      or
      a commercial delivery service or by facsimile shall be considered delivered
      under the terms of this lease. These addresses can be changed by written
      notification.

    

    
      	
              Lessor:
                

            	
              Alder
                Construction Company

            	
              Lessee:
                

            	
              ClearOne
                Communications, Inc.

            
	 	
              3939
                South 500 West

            	 	
              5225
                Wiley Post Way, Suite 500

            
	 	
              Salt
                Lake City, UT 84123

            	 	
              Salt
                Lake City, UT 84116

            
	 	 	 	 
	 	
              Fax
                (801) 266-2947

            	 	
              Fax
                (801) 977-0087

            

    

    

    ADDENDUM:

    

    The
      following Addendums are incorporated into this lease: NONE

    

    

    
      	
              ACCEPTED
                FOR LESSEE

            	
              CLEAR
                ONE INC.

              By:
                Marthes Solamuthu

              Title:
                Vice President of Operations

               

            
	
              ACCEPTED
                FOR LESSOR

            	
              ALDER
                CONSTRUCTION COMPANY

              By:
                Greg Alder

              Title:
                Property Management

            

    

    

    8

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