Style Lease Short Limited Duration Tenancy
[PARTY 1] and [PARTY 2] LEASE [Description]

Table Of Contents

Clause	Page No.

1	DEFINITIONS	1

2	INTERPRETATION	3

3	GRANT OF SHORT LIMITED DURATION TENANCY	4

4	RENT	4

5	COMMENCEMENT AND TERM	5

6	TENANTS’ OBLIGATIONS	5

7	LANDLORDS OBLIGATIONS	14

8	NOTICES	15

9	RESERVATIONS IN FAVOUR OF THE LANDLORD	15

10	DEDUCTION FROM PAYMENTS	18

11	NOTICES	18

12	IRRITANCY	18

13	EXPENSES OF LEASE	20

14	GOVERNING LAW AND JURISDICTION	20

15	CONSENT TO REGISTRATION	20

SCHEDULE	22

Part 1 – LIST OF AREAS	22

Part 2 – FIXED EQUIPMENT	23

Part 3 – RENT REVIEW (EXAMPLE)	24

LEASE

between

[PARTY 1], a Company incorporated under the Companies Acts (Registered Number [ ]) and having its registered office at [ ] (hereinafter called the “Landlords” which expression shall, wherever the context so admits, include their successors in title to the interest of the Landlords herein); and

[PARTY 2], a Company incorporated under the Companies Acts (Registered Number [ ]) and having its registered office at [ ] (hereinafter called the “Tenants” which expression shall, wherever the context so admits, include their permitted successors and assignees).

IT IS CONTRACTED AND AGREED between the Landlords, and the Tenants in the manner following:

DEFINITIONS

In this Lease, unless the context otherwise requires, the following expressions shall have the following meanings:

“ARED” means the Agriculture and Rural Economy Directorate (or any superseding body or directorate);

“Base Rate” means the Base Rate for the time being of The Royal Bank of Scotland plc or some other United Kingdom clearing bank nominated from time to time by the Landlords, or, in the event of Base Rate being abolished, some other comparable rate of interest as the Landlords shall determine;

“BFPS Entitlements” means the Basic Farm Payment Scheme as set out in Regulation 1307/2013 of the European Parliament, as supplemented by Commission Delegated Regulation 639/2014 or its predecessors or its predecessors [which shall include all payments under the Less Favoured Area Support Scheme];

“Initial Rent” means [ ] (£[ ]) STERLING per annum;

“Insurers” means such reputable insurance company or underwriters as the Landlords shall from time to time nominate;

“Fixed Equipment” means the Fixed Equipment to be specified in the schedule of fixed equipment to be agreed between the Landlords and the Tenants with reference to section 16(2) of the 2003 Act together with any other new or replacement items of fixed equipment as may be added by amendment to such schedule or in a substitution of such schedule but declaring for the avoidance of doubt that no cottage or house on the Property forms part of the Fixed Equipment and that the Tenants are satisfied that no accommodation for any employees of the Tenants are required as part of this Lease;

“Landlords” means the party hereinbefore named as ‘Landlords’ and includes, in substitution therefor, their successors in title to the interest of landlords under this Lease;

“Lease” means this Lease and any document which is made supplemental hereto, or which is entered into pursuant to or in accordance with the terms hereof;

“LBTT” means land and buildings transaction tax as defined in the Land and Buildings Transaction Tax (Scotland) Act 2013;

“Plan [ ]”, “Plan [ ]” and “Plan [ ]” mean respectively the plans numbered Plan [ ], Plan [ ] and Plan [ ] annexed and executed as relative hereto;

“Prescribed Rate” means four per cent per annum above Base Rate;

“Property” means the property known as [ ] and shown for identification purposes only delineated in [ ] on Plan [ ];

“Quarter Days” means 28 February, 28 May, 28 August, and 28 November and “Quarter Day” shall be construed accordingly;

“Quota” means any quotas relative to farm produce;

“Review Dates” means the [ ] day of [ ] in each of the following years [ ];

“Rules of Good Husbandry” means the rules of good husbandry as contained in the Sixth Schedule of the 1948 Act;

“Schedule” means the Schedule (comprising Parts [ ] to [ ] inclusive) annexed and executed as relative hereto and which Schedule is deemed to form part of this Lease;

“Tenants” means the party hereinbefore named as “Tenants” and includes the Tenants’ permitted successors in title and assignees and, in the case of an individual, his personal representatives but not any person who has been entitled to the tenants’ interest under this Lease after completion of a permitted assignation of this Lease by such a person;

“Tenancy” means the short limited duration tenancy created by this Lease;

“Term” means the period from the Term Commencement Date to [ ] (inclusive) and includes the period of any extension or continuation, whether by statute or common law;

“Term Commencement Date” means [ ];

“Termination Date” means the date of expiry of the Term or the date of earlier termination of this Lease howsoever terminated (albeit lawfully) whether prior to the date specified in the definition of the Term (but not the Term Commencement Date) or after such date, if lawfully continued;

“VAT” means Value Added Tax and includes any similar tax from time to time replacing it or of a similar fiscal nature;

“1948 Act” means The Agriculture (Scotland) Act 1948

“1991 Act” means the Agricultural Holdings (Scotland) Act 1991 as amended;

“2003 Act” means the Agricultural Holdings (Scotland) Act 2003 as amended.

INTERPRETATION

Unless there is something in the subject or context inconsistent therewith:

where two or more persons are included in the expression the “Tenants”, the obligations which are expressed to be by the Tenants shall be deemed to be made by such persons jointly and severally without the necessity of discussing them in their order.

in the event that the Tenants are a firm or a partnership, the obligations of the Tenants hereunder shall be binding jointly and severally on all persons who are or become partners of the firm or partnership at any time during the currency of this Lease and their respective executors and representatives as well as on the firm or partnership and its whole stock, funds, assets and estate without the necessity of discussing them in their order and such obligations shall subsist and remain in full force and effect notwithstanding any changes which may take place in the name of the firm or the partnership whether by the assumption of a new partner or partners or by the retiral, bankruptcy or death of any individual partner but the Landlords’ consent will not be unreasonably withheld to the removal of liability from a retiring or resigning partner or the estate of a deceased partner where an assignation would be permitted to the remaining partners under Clause 6.19 of this Lease;

words importing persons shall include firms, companies and corporations and vice versa;

any undertaking by the Tenants not to do any act or thing shall include an obligation not to permit or suffer such act or thing to be done;

references to any right of the Landlords to have access to or entry upon the Property or any other part of the Development shall be construed as extending to all persons authorised by the Landlords, including without prejudice to that generality agents, professional advisers, contractors, workmen and others;

any reference to a statute (whether specifically named or not) shall include any amendment or re-enactment of such statute for the time being in force and all instruments, orders, notices, regulations, directions, bye-laws, permissions and plans for the time being made, issued or given thereunder or deriving validity therefrom, provided that any reference to the Town and Country Planning (Use Classes) (Scotland) Order 1997 shall mean the said Order as at the Term Commencement Date;

the titles or headings appearing in this Lease are for reference only and shall not affect its construction; and

any reference to a clause shall mean a clause of this Lease.

GRANT OF SHORT LIMITED DURATION TENANCY

The Landlords in consideration of the Initial Rent and other prestations and of the whole conditions and others herein contained HEREBY LET the Property to the Tenants (but always excluding assignees, legal or voluntary, and creditors and managers for creditors in any form except as and to the extent permitted in terms of Sections 6 and 21 of the 2003 Act) TOGETHER WITH all existing rights and wayleaves for water supply and drainage and all rights of access to the Property over existing access tracks and roads or routes for the Term;

The tenancy established hereunder is a short limited duration tenancy in terms of Section 4 of the Agricultural Holdings (Scotland) Act 2003.

The Tenants accept that the Property, and the Fixed Equipment are in good and tenantable repair and condition and is in all respects suitable for the purposes for which the Property is let in terms of this Lease save as may be otherwise be implied or expressly stated in this Lease.

RENT

The Tenants shall pay to the Landlords throughout the Term the following:

yearly, and proportionately for any fraction of a year, the Initial Rent and from and including each Review Date such yearly rent as shall become payable under and in accordance with the provisions of the Schedule Part 3, in each case to be paid by equal quarterly payments (by Banker's Standing Order or Direct Debit if required by the Landlords in which case the Tenants shall deliver the appropriate standing order or Direct Debit to the Landlords for delivery to the Tenants' bank and shall not, without the prior written consent of the Landlords vary, amend or cancel any Banker's Standing Order or Direct Debit form completed by it in pursuance of this provision) in advance on the Quarter Days in every year without any retention, deduction, set-off, or counterclaim whatsoever, unless withheld in terms of Section 12 of the 2003 Act, the first payment being a proportionate sum in respect of the period from and including the Term Commencement Date to the day before the Quarter Day following the Term Commencement Date to be paid on the Term Commencement Date;

VAT to be paid pursuant to Clause 6.3; and

any other moneys which are stated by this Lease to be due by the Tenants.

The Landlords and the Tenants agree that the yearly rent under Clause 4.1.1 shall be reviewed in accordance with the Schedule Part 3.

COMMENCEMENT AND TERM

The Lease shall commence on the Term Commencement Date and shall be for a period of [ ] years unless earlier terminated in terms of Clause 12 of this Lease.

TENANTS’ OBLIGATIONS

The Tenants HEREBY bind and oblige themselves to observe and perform throughout the Term the following conditions, obligations and others:

Rents and Other Sums Due

To pay the rent and all other sums payable under this Lease on the days and in the manner specified in Clause 4 and for value on the date of receipt of payment and in each case without any retention, deduction, set-off or counterclaim.

Interest on arrears

Without prejudice to any other right or remedy otherwise available to the Landlords, if any of the rents or any other sum due under this Lease (whether formally demanded or not) or any other sum payable by the Tenants under this Lease shall remain unpaid (for whatever reason (including where the Landlords have declined to accept rent so as not to waive any breach or alleged breach of covenant)) after the date when payment was due, to pay interest thereon at the Prescribed Rate from and including the date on which payment was due to the date of payment to the Landlords (both before and after any judgment).

Value Added Tax

To pay to the Landlords on demand and to indemnify the Landlords on demand against any VAT in respect of any payments made or consideration provided by the Tenants under the provisions of this Lease or supplies made by the Landlords to the Tenants under the terms of, or in connection with, this Lease including without limitation any VAT arising as a result of the Landlords exercising an option to tax in respect of the Property pursuant to paragraph 2 Schedule 10 Value Added Tax Act 1994 and, in default of payment, the same shall be recoverable as rent in arrear;

Good Husbandry

At all times to cultivate and/or stock and manage the whole of the Property in accordance with the Rules of Good Husbandry so as not to impoverish or devalue the Property and to keep and leave the same clean and in good heart and condition at the Termination Date;

At all times to ensure that whilst making adequate provision for water supply for consumption by any stock on the Property not to cause a diminution of any existing water supply serving other properties;

To take all reasonable and practicable steps to keep the Property free from infestation by insects and other pests and to destroy rabbits moles rats and other vermin declaring that the Landlords shall have no liability for compensating the Tenants in respect of any damage or destruction caused by such vermin;

To cut grub up and keep the Property free from harmful or noxious weeds;

To take all reasonable steps to prevent the outbreak of any notifiable pest or disease and to notify the Landlords in writing forthwith of any outbreak or suspected outbreak of any notifiable pest or disease of crops or stock on the Property;

[To take all reasonable precautions to prevent the introduction of potato cyst eelworm on the Property and in particular not to grow on the same land during any period of six consecutive years more than one crop of main crop potatoes;]

If so requested by the Landlords to have an analysis of the soil of the Property (or of such part thereof as may be specified by the Landlords) by such Department or body as the Landlords may specify;

To return to the Property the full equivalent manurial value of any grasses clover forage plants (whether green or conserved) fodder straw roots or any other such item produced on the Property and sold or removed from the Property at any time previous to the last year of the Tenancy;

Not to dig up or take away or sell any top soil stone gravel earth clay turf or peat from the Property without the previous consent in writing of the Landlords;

On an annual basis to spread on the Property any manure and compost produced and made thereon during the season, or the previous season, and to leave any manure and compost not spread as at the Termination Date carefully and appropriately stored;

To use any sprays with all reasonable care to ensure that adjoining hedges trees grasses and crops are not adversely affected and to make good or replant or compensate the Landlords or adjoining owners or occupiers as necessary should any such damage occur and as far as possible to use chemicals for seed dressings or otherwise which will cause least harm to game birds and other wildlife;

To take all reasonable steps, in connection with the burning of any straw left on the stubble after harvest, to prevent fire from spreading to adjoining hedges, plantations, belts, fences or any other part of the Property or adjoining land (and without prejudice to the foregoing generality to comply with the requirement of the Code entitled “Straw and Stubble Burning and Muirburn Practice” or any other requirements of any other applicable coded or any amendment or replacement of the same) and in the event of damage occurring to such hedges plantations shelter belts fences or any other part of the Property or adjoining land to pay the full cost of re-instating the same together with full compensation for loss of timber or other property and for damage caused to the interests of the Landlords;

To give written notice forthwith to the Landlords upon giving any charge to a Bank or similar body over its farming stock on the Property.

Insurance

To insure and keep insured

a third party liability policy to cover the Tenants in a sum fully sufficient to cover against claims arising out of damage to property or injury to persons (including death) on the Property and being not less than [ ] Pounds Sterling ([ ]) and to indemnify the Landlords against any costs claims or liability thereby arising; and

an insurance policy to cover the Tenants during the Term for all live and dead stock and other produce for the time being on the Property (whether produced upon or purchased for or brought to the Property) against loss or damage by fire and disease and being such figure as may be mutually agreed and at no less a level than is customarily considered prudent and to indemnify the Landlords against any costs claims or liability thereby arising;

In the event of any of the live or dead stock being destroyed or damaged by fire or disease, as soon as reasonably practicable the Tenants shall lay out the net proceeds of the insurances referred to in Clause 6.5.1(b) in replacement or other equivalent to the satisfaction of the Landlords and in the event of any produce which is required to be consumed on the Property being destroyed or damaged by fire or disease to purchase, using the whole value of the produce, like produce to be consumed on the Property or to return to the Property the full equivalent manurial value of such produce in artificial manure or feeding stuffs, declaring that if the insurance money received shall be insufficient for the terms of this Clause then the Tenants shall be obliged to make up the deficiency out of their own resources;

Not to do or permit or suffer anything by reason whereof any insurance effected on the Property may be rendered void or voidable or any insurance monies may be wholly or partially irrecoverable;

To comply with all requirements of the Insurers as to fire precautions relating to the Property and to take all reasonable steps to minimise claims arising out of the damage to property or injury to person (including death) on the Property.

Records

To keep at the expense of the Tenants and on the request of the Landlords to produce at any reasonable times both during this Lease and after the Termination Date copies of:

all forms required under the Integrated Administration Control System and any similar Scheme amending or replacing the same;

true records of all cropping and livestock;

all Quotas and BSFP Entitlements allocations;

all necessary vouchers of all hay straw and any other produce sold off the Property and the provisions made for the return to the Property of their full equivalent manurial value and the provisions made to protect the Property from injury and deterioration in consequence of the exercise by the Tenants of his right to cropping and disposal of produce under Section 7 of the 1991 Act;

Declaring that the Tenants shall permit the Landlords to obtain and shall not object to or obstruct the Landlords from obtaining all relevant information held in respect of the Property and the produce and livestock thereon and all Quotas and/or BFPS Entitlements relating thereto from ARED or other competent authority.

Vicarious Liability

To ensure that in working the Property during the Term no wildlife crime is committed or permitted in terms of the Wildlife and Countryside Act 1981 as amended;

To warn off all poachers and trespassers, to permit the Tenants’ name to be used in any proceedings which the Landlords at the Landlord's cost may take against any poachers or trespassers, so far as possible to stop all encroachments and immediately to inform the Landlords thereof and to use best endeavours to prevent the acquisition by any party by prescription of any rights of way, public or private, or servitudes over any part of the Property.

Environmental Protection

To comply with all applicable Codes of Practice associated with the control and/or treatment of contaminative substances and control of pollution upon the Property including without prejudice to the foregoing generality the Code of Practice entitled “Prevention of Environmental Pollution from Agricultural Activity” issued by the Scottish Executive Environmental and Rural Affairs Department and any other requirements of any other applicable code or any amendment or replacement of the same and to indemnify the Landlords against any claims demands liabilities and penalties arising or imposed (whether before or after the Termination Date) as a result of the Tenants' failure so to comply.

Outgoings

To pay and indemnify the Landlords against all existing and future rates, taxes, duties, charges, assessments, impositions and outgoings whatsoever (whether or not of a capital or non-recurring nature or of a wholly novel character) which may at any time during the Term be charged, levied, assessed on or in respect of the Property or upon the owner or occupier of the Property (excluding any tax payable by the Landlords occasioned by any disposal of or dealing with the Landlords' interest in the Property).

Last Year of Tenancy

In the last year of the Tenancy

not to sell off or remove from but to consume on the Property all grasses hay straw fodder or root crops (other than potatoes and other vegetable crops) whether harvested or not in the last year of the Tenancy or remaining unconsumed from previous years and to leave properly stacked at some convenient place on the Property for the use of the Landlords or the next incoming tenant a reasonable quantity of all such grasses hay straw fodder and roots remaining unconsumed on the Termination Date;

to do all cultivations sowings plantings and other things in accordance with the Rules of Good Husbandry up to the Termination Date as if the Tenants were continuing tenants and to leave the Property so as to allow the continuance of a proper standard of cropping and husbandry;

to farm and cultivate the Property as reasonably required in writing by the Landlords;

not without the prior consent in writing of the Landlords to plough up any temporary pasture sown less than three years prior to the Termination Date without previously giving the Landlords the option to purchase the same at valuation;

if so required to give possession to the Landlords or the incoming tenants of any fields after the crop is harvested, the Landlords making the Tenants an appropriate rental allowance.

Yield up

At the Termination Date without any warning or process of removal to that effect:

to remove themselves, their subtenants and any other occupier from the Property;

subject as stated below to yield up the Property and (unless the Landlords have agreed or directed otherwise) all additions, alterations and improvements made thereto and all fixtures of every kind in or about the same or which may be affixed or fastened to or upon the same all in such condition as shall be consistent with the Tenants having fully complied with their obligations under this Lease;

to exhibit evidence of all Quotas/ BFPS Entitlements used in relation to the Property at the Termination Date.

Production of Notices

To advise the Landlords forthwith of any notice served under the provisions of any Statute or Order affecting the Property or the interest of the Landlords or the Tenants in the Property such obligation being in addition and without prejudice to any duty imposed on the Tenants by the general law to give notice to the Landlords of any writ notice or instrument served on the Tenants other than those mentioned in this Clause where the Tenants are bound to give notice to the Landlords;

To comply with notices

To comply with all requirements of any competent authority relative to the statutory designation of the Property or any part thereof including, without limitation, designation of the Property or any part thereof as an Environmentally Sensitive Area, Site of Special Scientific Interest, Special Area of Conservation, Special Protection Area, Nitrate Vulnerable Zone, National Scenic Area, Listed Building, Ancient Monument, or any such similar designation which now applies or which may apply in the future to the Property or any part thereof and to comply at once with and give effect to every direction or notice duly made and served upon the Tenants by a competent authority and not to do or suffer to be done or omitted any act, matter or thing in or on the Property which shall be a contravention of the Town and Country Planning (Scotland) Acts or any Order, Regulation or direction in pursuance thereof, and at all times to indemnify the Landlords against all actions, proceedings, penalties, costs, charges, claims or demands in respect of any breach of this clause.

Quotas

Any Quotas or BSFP Entitlements, and any other rights under any scheme existing or which may be introduced relating to the Property or the production or marketing of farm produce held by the Tenants at any time during this Lease shall not be surrendered, sold, leased or otherwise disposed of or dealt with by the Tenants without the Landlords' prior written consent declaring that should the Tenants (or in the event of the Tenants being a partnership any of the partners thereof) wish to sell or otherwise dispose of or remove from the Property the whole or any part of such Quota or BSFP Entitlements either during the term of this Lease or at its termination the Tenants (or in the event of the Tenants being a partnership any of the partners thereof) wishes to sell or otherwise dispose of or remove from the Property to the Landlords or in the option of the Landlords, the incoming tenants of the Property at the market value thereof at the time of sale or other disposal or removal which in the event of failure to agree the same shall be fixed by a valuer skilled in the valuation of Quota or BFPS Entitlements, as the case may be, acting as an expert and not as an arbiter whose decision (including in respect of his fees and other costs incurred) shall be final and not subject to appeal and who shall be mutually appointed or failing agreement as to such appointment, by a valuer skilled in the valuation of Quotas or BFPS Entitlements as the case may be appointed by the Chairman for the time being of the Scottish Branch of The Royal Institution of Chartered Surveyors which offer the Landlords or the incoming tenants shall have three weeks from the date of fixing of said notice to accept or decline;

The Tenants shall not during this Lease permit any Quotas or BFPS Entitlements or other such rights attaching to the Property during this Lease to lapse or to be reduced or suffer any other penalty through any failure on the part of the Tenants to adhere to any of the conditions attaching to any such Quotas or BFPS Entitlements;

Not without the prior written consent of the Landlords to enter into any set-aside or farm woodland premium scheme or any other or similar scheme involving the cessation of or restriction on the use of any part of the Property for agricultural purposes;

If a compensation payment of any kind becomes due as a result of the Tenants giving up (whether voluntarily or in compliance with regulations) the production on the Property of any item of farm produce (including without prejudice to that generality milk, potatoes, cereals and livestock) to allow the Landlords to have the whole or an appropriate part of such payment depending on the extent to which the capital and rental value of the Property is thereby reduced and any dispute under this clause shall be referred to arbitration;

To use all reasonable endeavours to secure the maximum possible entitlement to BFPS Entitlements (or any subsequent scheme) which may in future be attached to or used in connection with, or become payable as a result of the working or the Property during the Term and to take all steps necessary by the Tenants, including timeous submission of all applications, claims or forms necessary to secure the future payment of any such entitlement;

Fixed Equipment

To maintain the Fixed Equipment in at least the condition it was in when first provided by the Landlords for the Tenants, natural decay and fair wear and tear excepted, and generally in a clean neat and tidy condition;

To leave the Fixed Equipment in like condition and repair at the Termination Date;

To [maintain] or [pay a pro rata proportion along with all other users of the reasonable costs incurred for the maintenance] to at least the standard applicable as at the Date of Commencement the private roads serving the Property all of which the Tenants is hereby authorised to use for all purposes permitted in terms of this Lease;

To restore and re-instate any damage caused by the Tenants to any pipe tank or other apparatus used for drainage or for the supply of water to any part of the Property or any part of any neighbouring property belonging to the Landlords;

To take all steps to ensure unrestricted vehicular and pedestrian access at all times by and over all existing access tracks and roads for the benefit of the occupiers for the time being of any neighbouring property belonging to the Landlords;

Not to impede or allow to be impeded the drainage system or the water supply serving any property and regularly to scour all open drains watercourses and ditches on the Property and to leave them clean and clear;

[CONSIDER THAT A SCHEDULE OF CONDITION MAY BE USED]

Permitted User

The Property is let by this Lease for the purpose of their use by the Tenants

as a livestock-rearing farm primarily for cattle, and ancillary farming activities, in conjunction with other stock-rearing activities carried on at nearby farms by the Tenants, but specifically excluding non-agricultural activities unless with the prior consent of the Landlords; OR

only as agricultural land as defined by Section 93 of the 2003 Act and for no other purposes;

[CONSIDER THE FOLLOWING]

The Property or any part thereof, is not to be used as a market garden.

The Property, or any part thereof, is not to be used as a dairy farm, or for pig or poultry production, the Tenants having no claim against the Landlords for any alterations or improvements for such purposes or for compensation therefor at the termination of this Lease;

Not to carry on any activity or farming practice which would constitute a failure to keep the land in good agricultural or environmental condition or a breach of any statutory management regime which may lead to the loss of any BFPS Entitlements or other payment or scheme or production quota which may be introduced and held in respect of the Property;

Prohibition against seasonal Grazings and Cropping Agreements

Not, without the previous consent in writing of the Landlords to sell growing crops or let or licence grazing on the Property or take to feed thereon stock belonging to any person other than the Tenants.

Alterations

Not to alter or add to any of the Fixed Equipment or erect any buildings or fixed equipment or carry out any capital improvement on the Property unless with the prior written consent of the Landlords such consent not to be unreasonably withheld or delayed.

Alienation

Not to assign, sub-let or part with possession of the Property or any part of the Property, or permit or suffer thereon any caravans, campers, gypsies, picnicking parties, advertising signs or any other non-agricultural use of the Property.

Reletting

To permit all persons with the written authority of the Landlords to access the Property at all reasonable hours upon prior appointment having been made at any time during the Term in connection with the sale or during the period of 12 months prior to the Termination Date, the re-letting of the Property; and

To permit the Landlords to exhibit on a suitable part of the Property in the period of 12 months preceding the Termination Date (or at any time where any of the circumstances described in Clause 12 apply to the Tenants) a notice for the re-letting or at any time a notice for the sale of the Property (but provided that any such notice shall not materially obstruct or interfere with the Tenants’ use and enjoyment of the Property).

Indemnity

To free and relieve the Landlords of all claims costs expenses and losses incurred as a direct consequence of the Tenants breaching or failing to fulfil any obligation of the Tenants contained in this Lease or for which the Tenants are liable as a consequence of any statutory provision and in fortification of this obligation and indemnity.

LANDLORDS OBLIGATIONS

The Landlords shall be bound and obliged:

subject to the Tenants paying the Initial Rent and performing and observing all the obligations imposed upon the Tenants by this Lease or by statute and subject to the rights of irritancy diligence and resumption in favour of the Landlords to permit the Tenants peaceably to hold and enjoy the Property without any interruption by the Landlords or any persons claiming under or in trust for the Landlords;

in respect of the Fixed Equipment to comply with Section 16 of the 2003 Act or any replacement or re-enactment of that Section;

to insure to their full value all buildings included in the Fixed Equipment and in the event of damage by fire to any such building to reinstate or replace the building if its reinstatement or replacement is required for the fulfilment of the Landlord's responsibilities to manage the Property in accordance with the rules of good estate management as defined in the Fifth Schedule of the 1948 Act and provided that if such damage is due to the wilful act or negligence of the Tenants or any of the Tenants’ employees or agents the Tenants shall pay out in full from the Tenants’ own resources to reinstate the damage to the Property should the Insurers refuse to pay out in full on the said policy or policies.

NOTICES

Any notices requiring to be served in pursuance of any of the provisions contained in this Lease may be given and served in the manner prescribed by the applicable provisions of the 1991 Act or the 2003 Act, as appropriate;

Notices to the Landlords shall be deemed effectively served if addressed to the Landlords and served upon the Landlords or upon such agent or at such other place as the Landlords may from time to time appoint for that purpose by notice in writing given to the Tenants;

Notices to the Tenants shall be deemed effectively served if sent by the Landlords or by such agent on behalf of the Landlords to the Tenants by Recorded Delivery at the Tenant's last known address.

RESERVATIONS IN FAVOUR OF THE LANDLORD

Mines and Minerals

All mines minerals and quarries including without limitation sand and gravel in and under the Property or any part thereof with power to the Landlords and all persons authorised by the Landlords to search for and work and remove the same (with power to let down the surface or any buildings erected or to be erected thereon in the exercise of the aforesaid powers) subject to the Landlords making to the Tenants reasonable compensation for damage thereby done to the surface or buildings or crops and an abatement of rent in respect of the surface land or buildings of which the Tenants may be deprived by reason of the exercise of any of such powers.

Timber

All timber and other trees and shrubs now growing or which shall grow upon the Property hereafter with the right to the Landlords and all persons authorised by the Landlords to mark fell cut and carry away the same and to replant that part of the Property so cleared together with the right to remove the same over any roadway or any other part of the Property or from neighbouring land without making any payment to the Tenants for the use thereof but making reasonable compensation to the Tenants for any damage done in the exercise of the rights hereby reserved provided any such claim is made in the writing by the Tenants to the Landlords within a reasonable time

Water and Drainage

The right to the Landlords and all persons authorised by the Landlords to enter upon the whole or any part of the Property to install drainage pipes septic tanks and outfalls and/or to take water from any watercourse spring or other source or supply on or adjacent to the Property by means of pipes or otherwise and/or to lead water pipes or drainage pipes through the Property from any drainage system watercourse spring or any other source or place on any neighbouring subjects belonging to the Landlords provided sufficient water is left for the Tenants for normal permitted agricultural purposes declaring that such right is in addition to existing established rights whether servitude rights or others

Grant of Wayleaves etc

The right to grant any wayleaves servitudes and licences to any public or local authority or public utility company or other companies or persons with the right to authorise employees and agents of such parties with or without vehicles machinery and plant to enter upon the Property and carry out their works (they paying reasonable compensation for surface damage and crops lost) together with the benefit of all wayleaves servitudes and licences now existing or hereinafter granted under this Clause and all rents and other payments reserved thereby but not including the Tenants' portion of any compensation for any such wayleaves servitudes and licences

Entry for Repairs

Power to enter the Property and execute essential repairs for which the Tenants are liable and which the Tenants have failed to carry out within the period specified by notice in writing given by the Landlords to the Tenants and declaring that:

nothing in this Clause shall relieve the Tenants from any liability incumbent on the Tenants to execute repairs;

the whole or the proportionate part of the expenses thereof (as the case may be) for which the Tenants are liable shall be payable by the Tenants forthwith after such repairs have been executed and shall be subject to the interest at the Prescribed Rate; and

nothing in this Clause shall relieve the Tenants from any liability incumbent on the Tenants to execute repairs.

Right of Entry

The right to the Landlords and all persons authorised by the Landlords to enter upon the whole or any part of the Property with or without workmen vehicles animals machinery plant implements and other articles necessary for the due and proper exercise and enjoyment of the rights of the Landlords reserved in this Lease and for all reasonable purposes (including sporting hunting and recreational purposes) connected with the Property and any neighbouring subjects belonging to the Landlords including without prejudice to that generality rights of access over the Property exercisable by the Landlords and all persons authorised by the Landlords in order to gain access to those properties adjacent to but which do not form part of the Property but subject to reasonable compensation being paid to the Tenants for any damage caused in the exercise of such rights and powers

Resumption of Possession

The right to resume possession at any time of the Property or any portion thereof in terms of Section 17 of the 2003 Act

Renunciation of Possession

If the Landlords require any portion or portions of the Property for any purposes specified in Section 29 of the 1991 Act or any statutory modification thereof, or for purposes of building of any type not specified in that Section, or for mining, quarrying, sand or gravel working, turf removal, tree planting, game management, game crops or any industrial purposes whatsoever, or the occupation, letting or sale of land for purposes other than the use for agriculture or for any other purpose whatsoever not being the use of the land for agriculture (and whether the use of the land for such purpose is to be made by the Landlords or its licensee or by a purchaser, licensee or assignee from the Landlords) the right to call for a renunciation by the Tenants of such portion or portions of the Property so required, and the Tenants hereby undertakes and binds and obliges himself to make such renunciation within 28 days of the Landlords giving notice requiring such renunciation, the said renunciation to be effective not more than two months from the date of the Landlords giving notice as aforesaid.

Fishing and Shooting Rights

The right to the Landlords and all those duly authorised by the Landlords to fish by any lawful means in all lochs ponds rivers or streams on or passing through the Property and to take kill and shoot all game deer ground game (without prejudice to the rights of the Tenants under the Ground Game Act 1880 as amended) and vermin of all kinds with power to enter any part of the Property for those purposes with vehicles or otherwise on payment to the Tenants of compensation for all crop and stock damage thereby occasioned

Income from Wayleaves etc

The right to receive and to retain all if any income or other payments due in respect of any wayleaves and servitude rights burdening or affecting the Property or any part or parts of it howsoever constituted and whether constituted before or after the Term Commencement Date

DEDUCTION FROM PAYMENTS

Any sums due to the Landlords by the Tenants in respect of the Initial Rent or of any breach by the Tenants of any of the obligations of the Tenants specified in this Lease or by statute or of any injury dilapidation or deterioration of or damage to the Property or otherwise shall as the Landlords may deem fit be deducted from any sums payable by the Landlords to the Tenants at any time during the Tenancy or at or after the Termination Date whether or not such sums as are payable to the Landlords shall either be of a liquidate character or not or be recoverable by action or otherwise

NOTICES

Any notices requiring to be served in pursuance of any of the provisions contained in this Lease may be given and served in the manner prescribed by the applicable provisions of the 1991 Act;

Notices to the Landlords shall be deemed effectively served if addressed to the Landlords and served upon the Landlords or upon such agent or at such other place as the Landlords may from time to time appoint for that purpose by notice in writing given to the Tenants;

Notices to the Tenants shall be deemed effectively served if sent by the Landlords or by such agent on behalf of the Landlords to the Tenants by Recorded Delivery at the Tenant's last known address.

IRRITANCY

This Lease and the Tenancy shall become null and void and the Landlords shall be at full liberty on giving not less than two months prior notice in writing to the Tenants in terms of Section 18(7) of the 2003 Act to put an end to the same and to resume possession of the Property without due process of law and without prejudice to any claim which the Landlords may have against the Tenants under this Lease and that whether or not the Landlords is in breach of any of the obligations of the Landlords in terms of this Lease or by statute in the event of:

the Tenants granting an assignation of this Lease or any sub-tenancy of the whole or any part of the Property except as provided for in Section 7 or 39 of the 2003 Act; or

the Tenants allowing any part of the Initial Rent to remain unpaid for three months after it has become due for payment in terms of this Lease; or

the Tenants failing to cultivate and/or stock the Property according to the Rules of Good Husbandry; or

the Tenants being an individual becoming apparently insolvent or divesting himself of the Property by trust deed for behoof of creditors or otherwise or if a poinding or diligence of his effects shall be executed which would prejudicially affect the operation of the Property; or

the Tenants being a company becoming affected by any order or resolution requiring it to be placed into liquidation receivership or administration or whereby it is wound up or struck-off; or

the Tenants being a Partnership having a partner who becomes apparently insolvent or if a poinding or diligence of his effects or those of the Partnership shall be executed which would prejudicially affect the operation of the Property; or

the Tenants having received notice in writing from the Landlords requiring the Tenants to implement or observe any particular condition or conditions of this Lease within a specific and reasonable time failing timeously in any way to implement or observe such condition or conditions or any other condition or conditions of this Lease as is or are specified in such notice in writing and failure to implement and observe which is of a material nature and prejudicial to the interests of the Landlords.

If and when the Lease and the Tenancy do so become null and void:

the Tenants shall continue to be liable for the whole prestations and be bound to implement and fulfil the whole conditions and provisions incumbent on the Tenants in terms of this Lease up to the time fixed for the removal of the Tenants from the Property; and

the Tenants shall continue to be so liable notwithstanding that the Landlords is in breach of any of the obligations of the Landlords to the Tenants under this Lease or by statute.

EXPENSES OF LEASE

The Landlords and the Tenants shall each bear their own legal expenses incurred in the preparation adjustment and completion of this Lease.

The Tenant shall be responsible for paying the LBTT in respect of this Lease.

If registration of this Lease for preservation and execution is agreed as necessary by the Landlords and the Tenants the costs of such registration and the costs of two extracts of this Lease (one for each party) shall be borne by the Landlords and the Tenants in equal portions.

GOVERNING LAW AND JURISDICTION

This Lease shall be governed by and construed in accordance with Scots Law.

CONSENT TO REGISTRATION

The Landlords and the Tenants hereby respectively consent to the registration of this Lease for preservation and execution IN WITNESS WHEREOF these presents consisting of this and the preceding [ ] pages [together with the schedule [in [ ] parts] annexed hereto] are executed as follows:

SUBSCRIBED for and on behalf of the said [PARTY 1]
At
On
By
Print Full name	Director
Before this witness:
Print Full Name	Witness
Address

SUBSCRIBED for and on behalf of the said [PARTY 2]
At
On
By
Print Full name	Director
Before this witness:
Print Full Name	Witness
Address

This is the Schedule referred to in the foregoing Lease between [ ] and [ ] dated [ ]

SCHEDULE

– LIST OF AREAS

Enclosure Nos	Field Names	Area (ha)

– FIXED EQUIPMENT

– RENT REVIEW (EXAMPLE)

At the option of the Landlords the yearly rent from time to time payable in terms of Clause 4.1.1 of the foregoing Lease shall be reviewed at the Review Date in accordance with the provisions of this Part of the Schedule and from and including the Review Date, the yearly rent payable in terms of Clause 4.1.1 of the foregoing Lease shall equal the higher of:

The rent payable hereunder shall be reviewed in accordance with the terms of Sections 9 (3) to 9 (8) inclusive of the 2003 Act but without any notice requirement in terms of Section 9 (2) of the 2003 Act; OR

The rent payable according to the following formula:

Where:

R (a) is the increase in rent

R (b) is the rent payable immediately before the Review Date

RPI (a) is the General Index of Retail Prices for the month immediately preceding the Review Date.

RPI (b) is the General Index of Retail Prices for the month immediately preceding the previous review date or the Term Commencement Date as the case may be.

In the event of the General Index of Retail Prices ceasing to exist any references herein to the General Index of Retail Prices shall be deemed to be references to such other index issued by the relevant government department or body in replacement thereof.

In the event that by the Review Date the amount of the reviewed rent has not been agreed or determined as aforesaid (the date of agreement or determination being herein called the “Determination Date”) then:

in respect of the period (herein called the “ Interim Period”) beginning with the Review Date and ending on the day before the Quarter Day following the Determination Date, the Tenants shall pay to the Landlords rent at the yearly rate payable immediately before the Review Date and on the Determination Date, the Tenants shall pay to the Landlords, on demand as arrears of rent, the amount by which the reviewed rent for the Interim Period exceeds the rent actually paid during the Interim Period together with interest thereon at the Base Rate from the Review Date to the expiry of the Interim Period; and

in respect of the period from the expiry of the Interim Period until the actual date of payment the Tenants shall pay to the Landlords on demand as rent in arrears the amount by which the reviewed rent payable exceeds the rent actually paid during the Interim Period together with interest thereon at the Prescribed Rate.