EXHIBIT 10.2
INDUSTRIAL REAL ESTATE LEASE
between
▇▇▇▇▇▇ ▇▇▇▇▇▇ PROPERTIES,
LIMITED PARTNERSHIP,
as Landlord
and
SPINTEK GAMING TECHNOLOGIES, INC.
as Tenant
Dated as of August 22, 1997
INDUSTRIAL REAL ESTATE LEASE
TABLE OF CONTENTS
PAGE #
ARTICLE ONE. . . . . . . . . . . . . . . . . . . . . . . . . . .1
BASIC TERMS . . . . . . . . . . . . . . . . . . . . . . . .1
1.01 DEFINITIONS . . . . . . . . . . . . . . . . . . .1
1.02 BASE RENT . . . . . . . . . . . . . . . . . . . .6
1.03 RIDERS. . . . . . . . . . . . . . . . . . . . . .6
1.04 PARKING . . . . . . . . . . . . . . . . . . . . .6
ARTICLE TWO. . . . . . . . . . . . . . . . . . . . . . . . . . .6
LEASE TERM AND COMMON BUILDING AREAS. . . . . . . . . . . .6
2.01 LEASE OF PROPERTY FOR LEASE TERM. . . . . . . . .6
2.02 DELIVERY OF POSSESSION. . . . . . . . . . . . . .6
2.03 HOLDING OVER. . . . . . . . . . . . . . . . . . .7
2.04 COMMON BUILDING AREAS . . . . . . . . . . . . . .7
2.05 LANDLORD'S RIGHTS IN COMMON BUILDING AREAS. . . .7
ARTICLE THREE. . . . . . . . . . . . . . . . . . . . . . . . . .8
BASE RENT . . . . . . . . . . . . . . . . . . . . . . . . .8
3.01 TIME AND MANNER OF PAYMENT. . . . . . . . . . . .8
3.02 COST OF LIVING INCREASES. . . . . . . . . . . . .8
ARTICLE FOUR . . . . . . . . . . . . . . . . . . . . . . . . . .9
OTHER CHARGES PAYABLE BY TENANT . . . . . . . . . . . . . .9
4.01 ADDITIONAL RENT . . . . . . . . . . . . . . . . .9
4.02 OPERATING COSTS . . . . . . . . . . . . . . . . .9
4.03 PERSONAL PROPERTY TAXES . . . . . . . . . . . . 11
4.04 UTILITIES . . . . . . . . . . . . . . . . . . . 11
4.05 INSURANCE . . . . . . . . . . . . . . . . . . . 12
4.06 WAIVER OF SUBROGATION . . . . . . . . . . . . . 13
4.07 LATE CHARGES. . . . . . . . . . . . . . . . . . 13
4.08 INTEREST ON PAST DUE OBLIGATIONS. . . . . . . . 14
4.09 RETURN OF CHECK . . . . . . . . . . . . . . . . 14
4.10 SECURITY DEPOSIT; INCREASES . . . . . . . . . . 14
4.11 TERMINATION; ADVANCE PAYMENTS . . . . . . . . . 15
ARTICLE FIVE . . . . . . . . . . . . . . . . . . . . . . . . . 15
USE OF PROPERTY . . . . . . . . . . . . . . . . . . . . . 15
5.01 PERMITTED USES. . . . . . . . . . . . . . . . . 15
5.02 MANNER OF USE . . . . . . . . . . . . . . . . . 15
5.03 HAZARDOUS SUBSTANCES. . . . . . . . . . . . . . 15
(a) Reportable Uses Require Consent. . . . . . 15
(b) Duty to Inform Lessor. . . . . . . . . . . 16
(c) Indemnification. . . . . . . . . . . . . . 17
(d) Tenant's Compliance with Requirements. . . 17
(e) Inspection; Compliance with Law. . . . . . 18
5.04 SIGNS AND AUCTIONS. . . . . . . . . . . . . . . 18
5.05 INDEMNITY . . . . . . . . . . . . . . . . . . . 18
5.06 LANDLORD'S ACCESS . . . . . . . . . . . . . . . 19
ARTICLE SIX. . . . . . . . . . . . . . . . . . . . . . . . . . 20
CONDITION OF PROPERTY; MAINTENANCE, REPAIRS AND ALTERATIONS
. . . . . . . . . . . . . . . . . . . . . . . . . . 20
6.01 EXISTING CONDITIONS . . . . . . . . . . . . . . 20
6.02 EXEMPTION OF LANDLORD FROM LIABILITY. . . . . . 20
6.03 LANDLORD'S OBLIGATIONS. . . . . . . . . . . . . 20
6.04 TENANT'S OBLIGATIONS. . . . . . . . . . . . . . 21
6.05 ALTERATIONS, ADDITIONS, AND IMPROVEMENTS. . . . 22
6.06 CONDITION UPON TERMINATION. . . . . . . . . . . 23
ARTICLE SEVEN. . . . . . . . . . . . . . . . . . . . . . . . . 24
DAMAGE OR DESTRUCTION . . . . . . . . . . . . . . . . . . 24
7.01 PROPERTY DAMAGE . . . . . . . . . . . . . . . . 24
7.02 REDUCTION OF RENT . . . . . . . . . . . . . . . 24
7.03 WAIVER. . . . . . . . . . . . . . . . . . . . . 25
ARTICLE EIGHT. . . . . . . . . . . . . . . . . . . . . . . . . 25
CONDEMNATION. . . . . . . . . . . . . . . . . . . . . . . 25
8.01 CONDEMNATION. . . . . . . . . . . . . . . . . . 25
ARTICLE NINE . . . . . . . . . . . . . . . . . . . . . . . . . 26
ASSIGNMENT AND SUBLETTING . . . . . . . . . . . . . . . . 26
9.01 LANDLORD'S CONSENT REQUIRED . . . . . . . . . . 26
9.02 LANDLORD'S ELECTION . . . . . . . . . . . . . . 26
9.03 NO RELEASE OF TENANT. . . . . . . . . . . . . . 26
9.04 NO MERGER . . . . . . . . . . . . . . . . . . . 27
ARTICLE TEN. . . . . . . . . . . . . . . . . . . . . . . . . . 27
DEFAULTS; REMEDIES. . . . . . . . . . . . . . . . . . . . 27
10.01 COVENANTS AND CONDITIONS . . . . . . . . . 27
10.02 DEFAULTS . . . . . . . . . . . . . . . . . 27
10.03 REMEDIES . . . . . . . . . . . . . . . . . 28
10.04 CUMULATIVE REMEDIES. . . . . . . . . . . . 29
ARTICLE ELEVEN . . . . . . . . . . . . . . . . . . . . . . . . 30
PROTECTION OF LENDERS . . . . . . . . . . . . . . . . . . 30
11.01 SUBORDINATION. . . . . . . . . . . . . . . 30
11.02 ATTORNMENT . . . . . . . . . . . . . . . . 30
11.03 SIGNING OF DOCUMENTS . . . . . . . . . . . 30
11.04 ESTOPPEL CERTIFICATES. . . . . . . . . . . 31
11.05 TENANT'S FINANCIAL CONDITION . . . . . . . 31
ARTICLE TWELVE . . . . . . . . . . . . . . . . . . . . . . . . 32
LEGAL COSTS . . . . . . . . . . . . . . . . . . . . . . . 32
12.01 LEGAL PROCEEDINGS. . . . . . . . . . . . . 32
12.02 LANDLORD'S CONSENT . . . . . . . . . . . . 32
ARTICLE THIRTEEN . . . . . . . . . . . . . . . . . . . . . . . 33
MISCELLANEOUS PROVISIONS. . . . . . . . . . . . . . . . . 33
13.01 NON-DISCRIMINATION . . . . . . . . . . . . 33
13.02 LANDLORD'S LIABILITY . . . . . . . . . . . 33
13.03 SEVERABILITY . . . . . . . . . . . . . . . 33
13.04 INTERPRETATION . . . . . . . . . . . . . . 33
13.05 INCORPORATION OF PRIOR AGREEMENTS;
MODIFICATIONS . . . . . . . 34
13.06 NOTICES. . . . . . . . . . . . . . . . . . 34
13.07 WAIVERS. . . . . . . . . . . . . . . . . . 34
13.08 NO RECORDATION . . . . . . . . . . . . . . 34
13.09 BINDING EFFECT; CHOICE OF LAW. . . . . . . 35
13.10 CORPORATE AUTHORITY; PARTNERSHIP AUTHORITY
. . . . . . . . . . . . . . . . . . . . . 35
13.11 JOINT AND SEVERAL LIABILITY. . . . . . . . 35
13.12 FORCE MAJEURE. . . . . . . . . . . . . . . 35
13.13 EXECUTION OF LEASE . . . . . . . . . . . . 36
13.14 BROKERS AND LEASING AGENTS . . . . . . . . 36
13.15 RULES AND REGULATIONS. . . . . . . . . . . 36
13.16 BUILDING PLANNING. . . . . . . . . . . . . 36
13.17 LIENS. . . . . . . . . . . . . . . . . . . 37
LIST OF EXHIBITS
Exhibit Lease Section
Designation Description Reference
"A" Building Depiction Indicating Location
of Premises . . . . . . . . . . . . . . . . 1.01(s)
"B" Legal Description of Building Site . . . . 1.01(b)
"C" Rules and Regulations. . . . . . . . . . . 13.16
INDUSTRIAL REAL ESTATE LEASE
THIS INDUSTRIAL REAL ESTATE LEASE 9This "Lease") is made as of the
22 day of August, 1997, by and between ▇▇▇▇▇▇ ▇▇▇▇▇▇ PROPERTIES, LIMITED
PARTNERSHIP, a Delaware limited partnership ("Landlord") and SPINTEK
GAMING TECHNOLOGIES, INC., a California corporarion ("Tenant").
ARTICLE ONE
BASIC TERMS
Section 1.01 Definitions. For purposes of this lease,
the following terms shall have the following meanings:
(a)[Intentionally Omitted].
(b)Building: That certain parcel of real estate
located within the ▇▇▇▇▇▇ Airport Center as described on Exhibit
"B" attached hereto and incorporated herein by this reference and
the building and other improvements located thereon, all of which
is commonly known as ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇.
(c)Commencement Date: September 1, 1997.
(d)Common Building Areas: All areas and facilities
outside the Premises and within the exterior boundary line of the
Building and interior utility raceways within the Premises that are
provided and designated by the Landlord from time to time for the
general non-exclusive use of Landlord, Tenant and other tenants of
the Building and their respective employees, suppliers, shippers,
customers, contractors and invitees, including, without limitation,
trash areas, roadways, sidewalks, walkways, landscaped areas,
irrigation systems, lighting facilities, fences, gates, elevators,
roof, common entrances, common areas within the Building, common
pipes, conduits, wires and appurtenant equipment serving the
Premises, exterior signs, Tenant directories, fire detection
systems, sprinkler systems, security systems, and the parking
facilities for the Building. Landlord has the right to change the
Common Building Areas and to take other actions respecting these
areas in accordance with Section 2.05 below.
(e)Declaration: That certain Declaration of
Restrictions and Grant of Easements dated November 1, 1985 and
filed for record with the County Recorder of ▇▇▇▇▇ County, Nevada
("County Recorder") as Document No. 2175093, as supplemented by the
Supplement to Declaration of Restrictions and Grant of Easements
dated June 1, 1988, filed with the County Recorder in Book 880602,
Instrument No. 00517, as amended from time to time. The
Declaration is filed on the Building and a larger real estate
development, of which the Building is a part, known as ▇▇▇▇▇▇
Airport Center.
(f)Initial Security Deposit: Sixteen Thousand Seven
Hundred and 20/100 Dollars ($16,700.20). The Initial Security
Deposit shall be paid to Landlord by Tenant contemporaneously with
Tenant's execution hereof.
(g)Laws: All applicable statutes, regulations,
requirements, ordinances and orders promulgated by any federal,
state, local or regional governmental authority whether prior to or
following the Commencement Date of this Lease.
(h)Landlord's Address: ▇▇▇▇▇▇ ▇▇▇▇▇▇ Properties,
Limited Partnership, 3800 ▇▇▇▇▇▇ ▇▇▇▇▇▇ Parkway, ▇.▇. ▇▇▇ ▇▇▇▇▇,
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Property Management Division.
(i)Landlord's Broker: None.
(j)Lease Interest Rate: The lesser of (i) two
percentage points (2%) over that fluctuating rate of interest
announced from time to time by the Bank of America National Trust
and Savings Association as its prime or reference commercial
lending rate of interest (or in the event such bank is no longer
announcing such rate, by such other federally regulated banking
institution of comparable stature as Landlord shall determine), or
(ii) the maximum interest rate permitted by law.
(k)Lease Term: One (1) year beginning on the
Commencement Date and continuing until twelve (12) months after the
first day of the first full month following the Commencement Date.
(l)Leased Premises Address: ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇,
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇.
(m)Mortgagee: The mortgagee under a mortgage or
beneficiary under a deed of trust holding a lien encumbering the
Building or any holder of a ground leasehold interest in the
Building or any part thereof.
(n)Operating Costs: All costs of any kind paid or
incurred by Landlord because of or in connection with the
ownership, management, maintenance, repair, replacement,
restoration or operation of the Building (including all Common
Building Areas), including by way of illustration but not
limitation, all of the following: (i) all amounts charged to the
Building pursuant to the Declaration; (ii) Real Property Taxes;
(iii) all costs, charges and surcharges for utilities, water,
sewage, janitorial, waste disposal and refuse removal and all other
utilities and services provided to the Building which are not
separately metered or billed directly to tenants of the Building;
(iv) insurance costs for which Landlord is responsible under this
Lease or which Landlord or any Mortgagee deems necessary or
prudent; (v) any costs levied, assessed or imposed pursuant to any
applicable Laws; (vi) the cost (amortized over such period as
Landlord reasonably determines together with interest at the Lease
Interest Rate on the unamortized balance) of any capital
improvements to the Building or equipment replacements made by
Landlord after the Commencement Date that are intended to reduce
other Operating Costs or are required by any Laws or are necessary
in order to operate the Building at the same quality level as prior
to such replacement; (vii) costs and expenses of operation, repair
and maintenance of all structural and mechanical portions and
components of the Building including, without limitation, plumbing,
communication, heating, ventilating and air-conditioning ("HVAC"),
elevator, and electrical and other common Building systems; (viii)
utilities surcharges or any other costs levied, assessed or imposed
by, or at the direction of, or resulting from statutes or
regulations or interpretations thereof, promulgated by any federal,
state, regional, municipal or local government authority in
connection with the use or occupancy of the Building (including,
without limitation, energy conservation charges or surcharges);
(ix) all costs incurred in the management and operation of the
Building including, without limitation, gardening and landscaping,
maintenance, maintenance of signs, resurfacing and repaving,
painting, lighting, cleaning, and provision of Building security;
(x) all personal property taxes levied on or attributable to
personal property used in connection with the Building; (xi)
depreciation on personal property owned by Landlord which is
consumed in the operation or maintenance of the Building; (xii)
rental or lease payments paid by Landlord for rented or leased
personal property used in the operation or maintenance of the
Building; (xiii) management fees, wages, salaries and other labor
costs incurred in the management and operation of the Building;
(xiv) fees for required licenses and permits; (xv) reasonable
legal, accounting and other professional fees; (xvi) reasonable and
appropriate reserves for repair and replacement; and (xvii) any
other expenses which would reasonably or customarily be included in
the cost of managing, operating, maintaining and repairing
buildings similar to the Building. If the Building is not fully
occupied during any portion of the Lease Term, Landlord shall make
an appropriate adjustment to Operating Costs for such period
employing sound accounting and management principles, to determine
the amount of Operating Costs that would have been incurred had the
Building been fully occupied during such period. Operating Costs
shall not include depreciation of the Building or equipment
therein, commissions of real estate brokers and leasing agents, nor
any amounts paid by Landlord for tenant improvements.
(o)Permitted Uses: General office/warehousing use.
(p)Premises: The office/warehouse space in the
approximate location within the Building as indicated on Exhibit
"A" attached hereto and incorporated herein by this reference.
(q)Real Property Taxes: Any form of tax, assessment,
license fee, license tax, business license fee, commercial rental
tax, levy, charge, penalty, tax or similar imposition, imposed by
any authority having the direct power to tax (including any city,
county, state or federal government, or any school, agricultural,
lighting, drainage, transportation, air pollution, environmental or
other improvement or special assessment district) as against any
legal or equitable interest of Landlord in the Building and/or the
Premises, including, but not limited to, the following:
(i)any tax on a landlord's "right" to rent or
"right" to other income from the Premises or against
Landlord's business of leasing the Premises;
(ii)any assessment, tax, fee, levy or charge
in substitution, partially or totally, of any assessment, tax,
fee, levy or charge previously included within the definition
of Real Property Taxes (it is the intention of Tenant and
Landlord that all such new and increased assessments, taxes,
fees, levies and charges be included within the definition of
"Real Property Taxes" for the purposes of this Lease);
(iii)any assessment, tax, fee, levy or charge
allocable to or measured by the area of the Premises or the
rent payable hereunder, including, without limitation, any
gross income tax or excise tax levied by the state, county,
city or federal government, or any political subdivision
thereof, with respect to the receipt of such rent, or upon or
with respect to the possession, leasing, operating, management
and maintenance, alteration, repair, use or occupancy of the
Building, or any portion thereof;
(iv)any assessment, tax, fee, levy or charge
upon this transaction creating or transferring an interest or
an estate in the Premises;
(v)any assessment, tax, fee, levy or charge
based upon the number of people employed, working at, or using
the Premises or the Building, or utilizing public or private
transportation to commute to the Premises or the Building; and
(vi)reasonable legal and other professional
fees, costs and disbursements incurred in connection with
proceedings to contest, determine or reduce Real Property
Taxes. Real Property Taxes shall not include federal or state
income, franchise, inheritance or estate taxes of Landlord or
any of the parties which comprise Landlord.
(r)Rentable Square Feet in the Building: Thirty
thousand seven hundred fifty-five (30,755) rentable square feet.
The Building is stipulated for all purposes to contain said
Rentable Square Feet in the Building.
(s)Tenant's Address: ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇, ▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, C.F.O.
(t)Tenant's Broker: None.
(u)Tenant's Guarantor: None.
(v)Tenant's Rentable Square Feet: Fifteen thousand one
hundred eighty-two (15,182) rentable square feet. The Premises are
stipulated for all purposes to contain said Tenant's Rentable
Square Feet.
(w)Tenant's Share: Forty-nine and thirty-six
hundredths percent (49.36%).
Section 1.02 BASE RENT. The "Base Rent" shall be Eight
Thousand Three Hundred Fifty and 10/100 Dollars ($8,350.10) per
month. The Base Rent due for the first full calendar month during
the Lease Term shall be paid to Landlord by Tenant
contemporaneously with Tenant's execution hereof.
Section 1.03 RIDERS. None.
Section 1.04 PARKING. Tenant shall be entitled to use up to
twenty-five (25) unreserved uncovered parking spaces.
ARTICLE TWO
LEASE TERM AND COMMON BUILDING AREAS
Section 2.01 LEASE OF PROPERTY FOR LEASE TERM. Landlord
hereby leases the Premises to Tenant and Tenant leases the Premises
from Landlord for the Lease Term. The Lease Term is for the period
stated in Section 1.01(k) above and shall begin and end on the
dates specified in Section 1.01(k) above. The "Commencement Date"
shall be the date specified in Section 1.01(c) above for the
beginning of the Lease Term.
Section 2.02 DELIVERY OF POSSESSION. Landlord will be
deemed to have delivered to Tenant possession of the Premises in
its "as is" condition as of the Commencement Date. Tenant
acknowledges that neither Landlord nor its agents or employees have
made any representations or warranties as to the suitability or
fitness of the Premises for the conduct of Tenant's business or for
any other purpose, nor has Landlord or its agents or employees
agreed to undertake any alterations or construct any tenant
improvements to the Premises. If for any reason, Landlord cannot
deliver possession of the Premises to Tenant on or before the fixed
date component of the Commencement Date, this Lease will not be
void or voidable, and Landlord will not be liable to Tenant for any
resultant loss or damage.
Section 2.03 HOLDING OVER. Tenant shall vacate the Premises
upon the expiration or earlier termination of this Lease. Tenant
shall reimburse Landlord for and indemnify and hold Landlord
harmless against all damages, claims, losses, penalties, charges,
and expenses (including reasonable attorney's fees) incurred by
Landlord resulting from any delay by Tenant in vacating the
Premises. If Tenant does not vacate the Premises upon the
expiration or earlier termination of this Lease, Tenant's occupancy
of the Premises shall be a tenancy at sufferance, subject to all of
the terms of this Lease applicable to a tenancy at sufferance,
except that the Base Rent then in effect shall be equal to two
hundred percent (200%) of the Base Rent in effect immediately prior
to the expiration or earlier termination of this Lease. Nothing
contained in this Section 2.03 shall be construed as consent by
Landlord to any holding over of the Premises by Tenant, and
Landlord expressly reserves the right to require Tenant to
surrender possession of the Premises to Landlord upon the
expiration or earlier termination of this Lease.
Section 2.04 COMMON BUILDING AREAS. Tenant shall have the
nonexclusive right to the use in common with other tenants in the
Building, subject to the Rules and Regulations referred to in
Section 13.16 below, the Common Building Areas appurtenant to the
Premises, as they may change from time to time.
Section 2.05 LANDLORD'S RIGHTS IN COMMON BUILDING AREAS.
Landlord hereby reserves the right from time to time to do the
following provided it is done without unreasonable interference
with Tenant's use of the Premises:
(a) To install, use, maintain, repair and replace pipes,
ducts, conduits, wires and appurtenant meters and equipment for
service to other parts of the Building above the ceiling surfaces,
below the floor surfaces, within the walls and in the central core
areas, and to relocate any pipes, ducts, conduits, wires and
appurtenant meters and equipment included in the Premises which are
located in the Premises or located elsewhere outside the Premises,
and to expand the Building;
(b) To make changes to the Common Building Areas,
including, without limitation, changes in the location, size, shape
and number of driveways, parking spaces, entrances, loading and
unloading areas, ingress, egress, direction of traffic, landscaped
areas, and walkways and the parking facilities for the Building;
(c) To close temporarily any of the Common Building
Areas for maintenance purposes or to prevent prescriptive easements
so long as access to the Premises remains available;
(d) To designate other land outside the boundaries of
the Building and/or the ▇▇▇▇▇▇ Airport Center to be a part of the
Common Building Areas;
(e) To add additional buildings and improvements to the
Common Building Areas, including, without limitation, the
construction of buildings, parking structures or surface parking
areas;
(f) To use the Common Building Areas while engaged in
making additional improvements, repairs or alterations to the
Building, or any portion thereof provided, however, that such use
of the Common Building Areas shall be reasonable, including without
limitation, the duration and extent of such use; and
(g) To do and perform such other acts and make such
other changes in, to or with respect to the Common Building Areas
and the Building as Landlord may, in the exercise of sound business
judgment, deem to be appropriate.
ARTICLE THREE
BASE RENT
Section 3.01 TIME AND MANNER OF PAYMENT. Upon execution of
this Lease, Tenant shall pay Landlord the Base Rent in the amount
stated in Section 1.02 above for the first full month of the Lease
Term. The Base Rent for the first month of the Lease Term shall be
prorated on the basis of the actual number of days in such month,
if such month is a fractional month. If such month is a fractional
month, then the Base Rent for such fractional month shall be due
and payable on the Commencement Date. Thereafter, on the first day
of the second month of the Lease Term (or, if the first full month
of the Lease Term is the second month, then the third month of the
Lease Term) and each month thereafter, Tenant shall pay Landlord
the Base Rent, in advance, without offset, deduction or prior
demand. The Base Rent shall be payable at Landlord's Address or at
such other place as Landlord may designate in writing. Base Rent
is due on or before the first (1st) day of each month.
Section 3.02 INTENTIONALLY OMITTED
ARTICLE FOUR
OTHER CHARGES PAYABLE BY TENANT
Section 4.01 ADDITIONAL RENT. All charges payable by Tenant
hereunder other than Base Rent are called "Additional Rent." Unless
this Lease provides otherwise, all Additional Rent shall be paid
with the next monthly installment of Base Rent. The term "Rent"
shall mean Base Rent and Additional Rent.
Section 4.02 OPERATING COSTS.
(a) Tenant shall during the Lease Term pay as Additional
Rent Tenant's Share of the Operating Costs. The inclusion of the
improvements, facilities and services described in the definition
of Operating Costs set forth in Section 1.01(n) above, shall not be
deemed to impose an obligation upon Landlord to either have said
improvements or facilities or to provide any of said services
unless Landlord has agreed elsewhere in this Lease to provide the
specific improvement, facility or service.
(b) Tenant shall pay Tenant's Share of Operating Costs,
in advance, in monthly installments with the Base Rent based on
Landlord's good faith estimate of the Operating Costs. Landlord
may adjust such estimates from time to time as Landlord determines,
which adjustment will be effective as of the next rent payment date
after notice to Tenant. After the end of each calendar year,
Landlord shall deliver to Tenant a statement ("Actual Statement"),
in reasonable detail, of the actual Operating Costs incurred by
Landlord during the preceding calendar year and Tenant's Share of
such Operating Costs. Upon receipt of such statement, there shall
be an adjustment between Landlord and Tenant, with payment to
Landlord or credit given to Tenant, as the case may be, to reflect
the actual Operating Costs.
(c) Landlord shall have the right, from time to time, to
equitably allocate some or all of the Operating Costs for the
Building among different portions or occupants of the Building (the
"Cost Pools"), in Landlord's discretion. Such Cost Pools may
include, but shall not be limited to, the office space tenants of
the Building as a whole, and the industrial space tenants of the
Building as a whole. The Operating Costs within each such Cost
Pool shall be allocated and charged to the tenants within such Cost
Pool in an equitable manner.
(d) In the event of any dispute as to the amount of
Tenant's Share of Operating Costs as set forth in the Operating
Costs statement, Tenant shall have the right, after reasonable
notice and at reasonable times, to inspect and photocopy Landlord's
Operating Costs records at Landlord's offices. If, after such
inspection and photocopy, Tenant continues to dispute the amount of
Tenant's Share of Operating Costs as set forth in the Operating
Costs statement, Tenant shall be entitled to retain a national,
independent, certified public accountant mutually acceptable to
landlord and Tenant to audit Landlord's Operating Costs records to
determine the proper amount of Tenant's Share of Operating Costs.
Landlord shall be entitled to review the results of such audit
promptly after completion of same. If such audit proves that
Landlord has overcharged Tenant, then within fifteen (15) days
after the results of the audit are made available to Landlord,
Landlord shall credit Tenant the amount of such overcharge toward
the payments of Base Rent and Additional Rent next coming due under
this Lease. If such audit proves that Landlord has undercharged
Tenant, then within fifteen (15) days after the results of the
audit are made available to Tenant, Tenant shall pay to Landlord
the amount of any such undercharge. Tenant agrees to pay the cost
of such audit, provided that Landlord shall reimburse Lessee the
amount of such cost if the audit proves that Lessor's determination
of Tenant's Share of Operating Costs (as set forth in the Operating
Costs statement) was in error by more than six percent (6%).
Landlord shall be required to maintain records of all Operating
Costs for three (3) years following the issuance of the Operating
Costs statement for such Operating Costs. The payment by Tenant of
any amounts pursuant to this Section shall not preclude Tenant from
questioning the correctness of any Operating Costs statement.
Section 4.03 PERSONAL PROPERTY TAXES.
(a)Tenant shall pay all taxes charged against trade
fixtures, utility installations, furnishings, equipment or any
other personal property belonging to Tenant. Tenant shall use its
best efforts to have personal property taxed separately from the
Premises.
(b)If any of Tenant's personal property is taxed with
the Premises, Tenant shall pay Landlord the taxes for the personal
property within fifteen (15) days after Tenant receives a written
statement from Landlord for such personal property taxes.
Section 4.04 UTILITIES. The parties acknowledge that this
Lease is intended to be a fully net lease and that, except as
expressly provided in this Lease, Tenant shall be responsible for
all repairs required to the Premises and for the provision of all
utilities at the Premises, including but not limited to water,
sewage, trash removal, waste disposal, janitorial, electricity,
telephone, security, and cleaning of the Premises, together with
any taxes thereon. The costs of installing or otherwise bringing
any meters or utilities to the Premises shall be paid directly by
Tenant. Tenant shall contract with and pay, directly to the
appropriate supplier, the cost of all utilities and services
supplied to the Premises. All such contracts and suppliers will be
subject to Landlord's prior, reasonable approval. If any such
utilities or services are not able to be separately metered or
separately billed to the Premises, Tenant shall pay to Landlord a
reasonable proportion to be determined by Landlord of all such
charges jointly metered or billed with other premises in the
Building to Landlord, together with a reasonable administrative
fee, immediately upon receipt of Landlord's ▇▇▇▇ therefor.
Notwithstanding the foregoing, Landlord may elect from time to time
and at any time during the term of this Lease to contract directly
with any supplier of utilities or services to the Premises and to
▇▇▇▇ Tenant for such costs, which ▇▇▇▇ may include a reasonable
administrative fee to Landlord.
Section 4.05 INSURANCE.
(a)Landlord shall maintain property insurance on the
Building and appurtenant structures in such amounts as Landlord and
any Mortgagees may deem necessary or appropriate. The cost of such
insurance shall be included within the definition of Operating
Costs hereunder. Payments for losses thereunder shall be made
solely to Landlord or the Mortgagees as their respective interests
shall appear. In addition, Tenant shall obtain and keep in force
at all times during the Lease Term, a policy or policies of
insurance covering loss or damage to all of the improvements,
betterments, personal property, utility installations, trade
fixtures, furnishings, income and business contents located within
the Premises other than the Building Shell in the amount of one
hundred percent (100%) of the full replacement value thereof as
reasonably ascertained by the Tenant's insurance carrier against
risks of direct physical loss or damage, normally covered in an
"all risk" policy (including the perils of flood and surface
waters), as such term is used in the insurance industry; provided,
however, that Tenant shall have no obligation to insure against
earthquake. The proceeds of such insurance shall be used for the
repair or replacement of the property so insured.
(b)Tenant shall, at Tenant's expense, maintain a policy
of Commercial General Liability insurance insuring Tenant and as
additional insureds, Landlord and any Mortgagees, against liability
arising out of the ownership, use, occupancy or maintenance of the
Premises. Such insurance shall be on an occurrence basis providing
single-limit coverage in an amount not less than One Million
Dollars ($1,000,000) per occurrence. The initial amount of such
insurance shall be subject to periodic increase upon reasonable
demand by Landlord based upon inflation, increased liability
awards, recommendation of professional insurance advisers, and
other relevant factors. However, the limits of such insurance
shall not limit Tenant's liability nor relieve Tenant of any
obligation hereunder. Such policy shall contain the following
provision: "Such insurance as afforded by this policy for the
benefit of Landlord shall be primary as respects any claims, losses
or liabilities arising out of the use of the Premises by the Tenant
or by Tenant's operation and any insurance carried by the Landlord
shall be excess and noncontributing." The policy shall insure
Tenant's performance of the indemnity provisions of Section 5.05.
(c)Tenant shall, from time to time, at Tenant's sole
expense, obtain and maintain other types of insurance as Tenant,
Landlord or the Mortgagees of Landlord may reasonably require in
form, in amounts and for insurance risks against which a prudent
tenant would protect itself.
(d)Insurance required to be maintained by Tenant
hereunder shall be in companies holding a "General Policyholders'
Rating" of B-plus or better and a "financial rating" of 10 or
better, as set forth in the most current issue of "Best's Insurance
Guide," or such comparable ratings as Landlord shall approve, in
its sole discretion. Tenant shall promptly deliver to Landlord,
within thirty (30) days of the Commencement Date, original
certificates evidencing the existence and amounts of such
insurance. No such policy shall be cancelable or subject to
reduction of coverage except after thirty (30) days prior written
notice to Landlord. Tenant shall, within thirty (30) days prior to
the expiration, cancellation or reduction of such policies, furnish
Landlord with renewals or "binders" thereof. Tenant shall not do
or permit to be done anything which shall invalidate the insurance
policies required under this Lease.
Section 4.06 WAIVER OF SUBROGATION. Tenant and/or Landlord
shall obtain from the issuers of the insurance policies referred to
in this Article Four a mutual waiver of subrogation provision in
said policies and Tenant and Landlord each hereby release and
relieve the other, and waive any and all rights of recovery against
the other, or against the employees, officers, agents and
representatives of the other, for loss or damage arising out of or
incident to the perils required to be insured against under this
Section 4 which perils occur in, on or about the Premises, whether
due to the negligence of Landlord or Tenant or their agents,
employees, contractors or invitees.
Section 4.07 LATE CHARGES. Tenant acknowledges that
Tenant's failure to pay Base Rent or Additional Rent promptly may
cause Landlord to incur unanticipated costs. The exact amount of
such costs are impractical or extremely difficult to ascertain.
Such costs may include, but are not limited to, processing and
accounting charges and late charges which may be imposed on
Landlord by any ground lease, mortgage or trust deed encumbering
the Premises. Therefore, if Landlord does not receive any Rent
payment within ten (10) days after it becomes due, Tenant shall pay
Landlord a late charge equal to ten percent (10%) of the overdue
amount. The parties agree that such late charge represents a fair
and reasonable estimate of the costs Landlord will incur by reason
of such late payment. In the event that a late charge is payable
hereunder, whether or not collected, for three (3) consecutive
installments of Rent, the Rent shall automatically become due and
payable quarterly in advance, rather than monthly, notwithstanding
Section 3.01 above.
Section 4.08 INTEREST ON PAST DUE OBLIGATIONS. Any amount
owed by Tenant to Landlord which is not paid when due shall bear
interest at the rate of (i) fifteen percent (15%) per annum, or
(ii) the Prime Rate plus five (5) percentage points per annum,
whichever is greater, from the due date of such amount. However,
interest shall not be payable on late charges to be paid by Tenant
under this Lease. The payment of interest on such amounts shall
not excuse or cure any default by Tenant under this Lease. If the
interest rate specified in this Lease is higher than the rate
permitted by law, the interest rate is hereby decreased to the
maximum legal interest rate permitted by law.
Section 4.09 RETURN OF CHECK. If Base Rent or Additional
Rent is paid by check and the check is returned to Landlord for any
reason whatsoever without payment, Tenant shall be assessed a late
charge and interest on past due amount pursuant to Sections 4.07
and 4.08 as well as a Fifty Dollar ($50) fee. If payment is
returned for insufficient funds, Landlord has the right to demand
that such payment be in the form of a cashiers or certified check.
If Tenant has two (2) or more insufficient funds' payments in a
twelve (12) month period, Landlord will demand all subsequent
payments be in the form of a cashiers or certified check.
Section 4.10 SECURITY DEPOSIT; INCREASES. Upon the
execution of this Lease, Tenant shall deposit with Landlord a cash
security deposit (the "Security Deposit") in the amount of the
Initial Security Deposit set forth in Section 1.01(f) above.
Landlord may apply all or part of the Security Deposit to any
unpaid Rent or other charges due from Tenant or to cure any other
defaults of Tenant. If Landlord uses any part of the Security
Deposit, Tenant shall restore the Security Deposit to its full
amount within ten (10) days after Landlord's written request.
Tenant's failure to do so shall be a material default under this
Lease. No interest shall be paid on the Security Deposit.
Landlord shall not be required to keep the Security Deposit
separate from its other accounts and no trust relationship is
created with respect to the Security Deposit. Each time the Base
Rent is increased, Tenant shall, on or before the date that the
first increased Base Rent payment is due, deposit additional funds
with Landlord sufficient to increase the Security Deposit to an
amount which bears the same relationship to the adjusted Base Rent
as the Initial Security Deposit bore to the initial Base Rent.
Section 4.11 TERMINATION; ADVANCE PAYMENTS. Upon expiration
of this Lease or other termination of this Lease not resulting from
Tenant's default, and after Tenant has vacated the Premises in the
manner required by this Lease, an equitable adjustment shall be
made concerning advance rent and other advance payments made by
Tenant to Landlord, and Landlord shall refund any unused portion of
the Security Deposit to Tenant, or, at Landlord's option, to
Tenant's assignee or sublessee.
ARTICLE FIVE
USE OF PROPERTY
Section 5.01 PERMITTED USES. Tenant may use the Premises
only for the Permitted Uses set forth in Section 1.01(o) above.
Section 5.02 MANNER OF USE. Tenant shall not cause or
permit the Premises to be used in any way (i) which constitutes (or
would constitute) a violation of any Laws, occupancy certificate,
the requirements of any board of fire underwriters or similar body,
as any of the same now or in the future may exist, or (ii) which
annoys or interferes with the rights of tenants or users of the
Building, or (iii) which constitutes a nuisance or waste, or (iv)
which is prohibited by the Declaration. Tenant, at its sole cost
and expense, shall comply with all Laws now in force or which may
hereafter be in force regulating the use, occupancy or alterations
by Tenant of the Premises. Landlord makes no representation or
warranty as to the suitability of the Premises for Tenant's
intended use or whether such use complies with all such Laws.
Section 5.03 HAZARDOUS SUBSTANCES.
(a) Reportable Uses Require Consent. The term
"Hazardous Substance" as used in this Lease shall mean any product,
substance, chemical, material or waste whose presence, nature,
quantity and/or intensity of existence, use, manufacture, disposal,
transportation, spill, release or effect, either by itself or in
combination with other materials expected to be on the Premises, is
either: (i) potentially injurious to the public health, safety or
welfare, the environment, or the Premises; (ii) regulated or
monitored by any governmental authority; or (iii) a basis for
potential liability of Landlord to any governmental agency or third
party under any applicable statute or common law theory. Hazardous
Substance shall include, but not be limited to, hydrocarbons,
petroleum, gasoline, crude oil or any products or by-products
thereof. Tenant shall not engage in any activity in or about the
Premises which constitutes a Reportable Use (as hereinafter
defined) of Hazardous Substances without the express prior written
consent of Landlord and compliance in a timely manner (at Tenant's
sole cost and expense) with all Applicable Requirements (as defined
in Section 5.03(d)). "Reportable Use" shall mean (i) the
installation or use of any above or below ground storage tank, (ii)
the generation, possession, storage, use, transportation, or
disposal of a Hazardous Substance that requires a permit from, or
with respect to which a report, notice, registration or business
plan is required to be filed with, any governmental authority, and
(iii) the presence in, on or about the Premises of a Hazardous
Substance with respect to which any Applicable Requirements require
that a notice be given to persons entering or occupying the
Premises or neighboring properties. Notwithstanding the foregoing,
Tenant may, without Landlord's prior consent, but upon notice to
Landlord and in compliance with all Applicable Requirements, use
any ordinary and customary materials reasonably required to be used
by Tenant in the normal course of the Permitted Uses, so long as
such use is not a Reportable Use and does not expose the Premises
or neighboring properties to any meaningful risk of contamination
or damage or expose Landlord to any liability therefor. In
addition, Landlord may (but without any obligation to do so)
condition its consent to any Reportable Use of any Hazardous
Substance by Tenant upon Tenant's giving Landlord such additional
assurances as Landlord, in its reasonable discretion, deems
necessary to protect itself, the public, the Premises and the
environment against damage, contamination or injury and/or
liability therefor, including but not limited to the installation
(and, at Landlord's option, removal on or before Lease expiration
or earlier termination) of reasonably necessary protective
modifications to the Premises (such as concrete encasements) and/or
the deposit of an additional Security Deposit.
(b) Duty to Inform Lessor. If Tenant knows, or has
reasonable cause to believe, that a Hazardous Substance has come to
be located in, on, under or about the Premises or the Building,
other than as previously consented to by Landlord, Tenant shall
immediately give Landlord written notice thereof, together with a
copy of any statement, report, notice, registration, application,
permit, business plan, license, claim, action, or proceeding given
to, or received from, any governmental authority or private party
concerning the presence, spill, release, discharge of, or exposure
to, such Hazardous Substance including but not limited to all such
documents as may be involved in any Reportable Use involving the
Premises. Tenant shall not cause or permit any Hazardous Substance
to be spilled or released in, on, under or about the Premises
(including, without limitation, through the plumbing or sanitary
sewer system).
(c)Indemnification. Tenant shall indemnify, protect,
defend and hold Landlord, its agents, employees, lenders and ground
lessor, if any, and the Premises, harmless from and against any and
all damages, liabilities, judgments, costs, claims, liens,
expenses, penalties, loss of permits and attorneys' and
consultants' fees arising out of or involving any Hazardous
Substance brought onto the Premises by or for Tenant or by anyone
under Tenant's control. Tenant's obligations under this Section
5.03(c) shall include, but not be limited to, the effects of any
contamination or injury to person, property or the environment
created or suffered by Tenant, and the cost of investigation
(including consultants' and attorneys' fees and testing), removal,
remediation, restoration and/or abatement thereof, or of any
contamination therein involved, and shall survive the expiration or
earlier termination of this Lease. No termination, cancellation or
release agreement entered into by Landlord and Tenant shall release
Tenant from its obligations under this Lease with respect to
Hazardous Substances, unless specifically so agreed by Landlord in
writing at the time of such agreement.
(d) Tenant's Compliance with Requirements. Tenant
shall, at Tenant's sole cost and expense, fully, diligently and in
a timely manner, comply with all "Applicable Requirements," which
term is used in this Lease to mean all laws, rules, regulations,
ordinances, directives, covenants, easements and restrictions of
record, permits, the requirements of any applicable fire insurance
underwriter or rating bureau, and the recommendations of Landlord's
engineers and/or consultants, relating in any manner to the
Premises (including but not limited to matters pertaining to (i)
industrial hygiene, (ii) environmental conditions on, in, under or
about the Premises, including soil and groundwater conditions, and
(iii) the use, generation, manufacture, production, installation,
maintenance, removal, transportation, storage, spill, or release of
any Hazardous Substance), now in effect or which may hereafter come
into effect. Tenant shall, within five (5) days after receipt of
Landlord's written request, provide Landlord with copies of all
documents and information, including but not limited to permits,
registrations, manifests, applications, reports and certificates,
evidencing Tenant's compliance with any Applicable Requirements
specified by Landlord, and shall immediately upon receipt, notify
Landlord in writing (with copies of any documents involved) of any
threatened or actual claim, notice, citation, warning, complaint or
report pertaining to or involving failure by Tenant or the Premises
to comply with any Applicable Requirements.
(e) Inspection; Compliance with Law. Landlord,
Landlord's agents, employees, contractors and designated
representatives, and any Mortgagees, shall have the right to enter
the Premises at any time in the case of an emergency, and otherwise
at reasonable times, for the purpose of inspecting the condition of
the Premises and for verifying compliance by Tenant with this Lease
and all Applicable Requirements, and Landlord shall be entitled to
employ experts and/or consultants in connection therewith to advise
Landlord with respect to Tenant's activities, including but not
limited to Tenant's installation, operation, use, monitoring,
maintenance, or removal of any Hazardous Substance on or from the
Premises. The costs and expenses of any such inspections shall be
paid by the party requesting same, unless a default of this Lease
by Tenant or a violation of Applicable Requirements or a
contamination, caused or materially contributed to by Tenant, is
found to exist or to be imminent, or unless the inspection is
requested or ordered by a governmental authority as the result of
any such existing or imminent violation or contamination. In such
case, Tenant shall upon request reimburse Landlord or Landlord's
Mortgagee, as the case may be, for the costs and expenses of such
inspections.
Section 5.04 SIGNS AND AUCTIONS. Tenant shall not place any
signs on the Premises without Landlord's prior written consent.
Tenant shall not conduct or permit any auctions or sheriff's sales
at the Premises.
Section 5.05 INDEMNITY. Tenant shall indemnify and hold
harmless Landlord and all agents, servants and employees of
Landlord from and against all claims, losses, damages, expenses
(including reasonable attorneys' fees), penalties and charges
arising from or in connection with (i) Tenant's use of the Premises
during the Lease Term, or (ii) the conduct of Tenant's business, or
(iii) any activity, work or things done, permitted or suffered by
Tenant in or about the Premises during the Lease Term. Tenant
shall further indemnify and hold harmless Landlord from and against
any and all claims, loss, damage, expense (including reasonable
attorneys' fees), penalty or charge arising from any default in the
performance of any obligation on Tenant's part to be performed
under the terms of this Lease, or arising from any negligence of
Tenant, or any of Tenant's agents, contractors, or employees, and
from and against all costs, attorneys' fees, expenses and
liabilities incurred in the defense of any such claim or any action
or proceeding brought thereon. If any action or proceeding be
brought against Landlord by reason of any such claim, Tenant, upon
notice from Landlord, shall defend the same at Tenant's expense by
legal counsel reasonably satisfactory to Landlord. Tenant, as a
material part of its consideration to Landlord, hereby assumes all
risk of damage to property or injury to persons in or upon the
Premises arising from any cause and Tenant hereby waives all claims
in respect thereof against Landlord. Notwithstanding the
foregoing, Tenant shall not be required to defend, save harmless or
indemnify Landlord from any liability for injury, loss, accident or
damage to any person or property resulting from Landlord's
negligence or willful acts or omissions, or those of Landlord's
officers, agents, contractors or employees. Tenant's indemnity is
not intended to nor shall it relieve any insurance carrier of its
obligations under policies required to be carried by Tenant
pursuant to the provisions of this Lease to the extent that such
policies cover the results of negligent acts or omissions of
Landlord, its officers, agents, contractors or employees, or the
failure of Landlord to perform any of its obligations under this
Lease.
Section 5.06 LANDLORD'S ACCESS. Landlord or its agents may
enter the Premises at all reasonable times to show the Premises to
potential buyers, investors or tenants or other parties, or for any
other purpose Landlord deems necessary. Landlord shall give Tenant
prior notice of such entry, except in the case of an emergency.
Landlord may place customary "For Sale" or "For Lease" signs on the
Premises.
ARTICLE SIX
CONDITION OF PROPERTY; MAINTENANCE, REPAIRS AND ALTERATIONS
Section 6.01 EXISTING CONDITIONS. Tenant accepts the
Premises in its condition "AS IS" as of the date of execution of
this Lease, subject to all recorded matters and Laws. Tenant
acknowledges that neither Landlord nor any employee or agent of
Landlord has made any representation as to the condition of the
Premises or the suitability of the Premises for Tenant's intended
use.
Section 6.02 EXEMPTION OF LANDLORD FROM LIABILITY. Landlord
shall not be liable for and Tenant shall indemnify and hold
Landlord harmless from and against all claims, losses, damages,
expenses, penalties and charges arising from or in connection with
any damage or injury to the person, business (or any loss of income
therefrom), goods, wares, merchandise or other property of Tenant,
Tenant's employees, invitees, customers or any other person in or
about the Premises, whether such damage or injury is caused by or
results from: (a) fire, steam, electricity, water, gas or rain; (b)
the breakage, leakage, obstruction or other defects of pipes,
sprinklers, wires, appliances, plumbing, air conditioning or
lighting fixtures or any other cause; (c) the failure, delay or
diminution in the quality or quantity of any utilities or services
supplied to the Premises or the Building, or (d) any conditions
arising in or about the Premises, or from other sources or places,
nor shall any of the same be construed as an eviction of Tenant,
nor, unless otherwise permitted under this Lease, work an abatement
of Rent, nor relieve Tenant from any obligation under this Lease.
Landlord shall not be liable for any such damage or injury even
though the cause of or the means of repairing such damage or injury
are not accessible to Tenant. The provisions of this Section 6.02
shall not, however, exempt Landlord from liability for Landlord's
gross negligence or willful misconduct.
Section 6.03 LANDLORD'S OBLIGATIONS. Landlord shall keep
the following in good order, condition and repair: the foundations,
exterior structural walls and structural roof of the Building.
Landlord shall not be obligated to maintain or repair windows,
doors, plate glass or the interior surfaces of exterior walls.
Landlord shall have no obligation to make repairs under this
Section 6.03 until a reasonable time after Landlord receives
written notice from Tenant of the need of such repairs. Tenant
expressly waives the benefit of any statute in effect now or in the
future which might give Tenant the right to make repairs at
Landlord's expense or to terminate this Lease due to Landlord's
failure to keep the Premises in good order, condition and repair.
Section 6.04 TENANT'S OBLIGATIONS.
(a) Tenant shall, at Tenant's sole cost and expense,
keep all portions of the Premises in good order, condition and
repair, including, without limitation, all components of the
electrical, mechanical, plumbing, heating, air conditioning and
ventilation systems which serve the Premises and all other items
not expressly set forth as the responsibility of Landlord in
Section 6.03 above. If any portion of the Premises or any system
or equipment in the Premises which Tenant is obligated to repair
cannot be fully repaired, Tenant shall promptly replace such
portion of or system or equipment in the Premises, regardless of
whether the benefit of such replacement extends beyond the Lease
Term.
(b) Either Landlord or Tenant, at Tenant's option and at
Tenant's sole expense, shall enter into a preventative maintenance
contract ("Maintenance Contract") with a licensed heating and air
conditioning contractor providing for the regular inspection and
maintenance of the heating, air conditioning and ventilation system
utilized for the Premises. Landlord shall have the right to
approve the contractor and the Maintenance Contract prior to
Tenant's execution thereof. Thirty (30) days prior to the
Commencement Date, Tenant shall inform Landlord whether Tenant will
obtain the Maintenance Contract or whether Tenant wants Landlord to
obtain the Maintenance Contract. In the event Tenant elects to
obtain the Maintenance Contract, Tenant shall provide Landlord with
a copy of such Maintenance Contract at least fifteen (15) days
prior to the Commencement Date: the Maintenance Contract cannot be
canceled without providing Landlord with thirty (30) days prior
written notice. If Tenant elects not to obtain a Maintenance
Contract or if Tenant fails to provide Landlord with a copy of the
Maintenance Contract fifteen (15) days prior to the Commencement
Date, Landlord shall obtain the Maintenance Contract for Tenant's
benefit and Tenant shall be obligated to pay Landlord, as
Additional Rent, monthly, without demand, one-twelfth (1/12th) of
the annual cost of the Maintenance Contract. Regardless if
Landlord or Tenant obtains the Maintenance Contract, Landlord shall
have the right to enter Tenant's Premises to inspect the air
conditioning, heating and ventilation system utilized for Tenant's
Premises.
(c) Either Landlord or Tenant, at Tenant's option and at
Tenant's sole expense, shall enter into a sewer and trash removal
contract ("Trash Removal Contract") with a contractor providing for
regular sewer and trash removal services for the Premises.
Landlord shall have the right to approve the contractor and the
Trash Removal Contract prior to Tenant's execution thereof. Thirty
(30) days prior to the Commencement Date, Tenant shall inform
Landlord whether Tenant will obtain the Trash Removal Contract or
whether Tenant wants Landlord to obtain the Trash Removal Contract.
In the event Tenant elects to obtain the Trash Removal Contract,
Tenant shall provide Landlord with a copy of such Trash Removal
Contract at least fifteen (15) days prior to the Commencement Date:
the Trash Removal Contract cannot be canceled without providing
Landlord with thirty (30) days prior written notice. If Tenant
elects not to obtain a Trash Removal Contract or if Tenant fails to
provide Landlord with a copy of the Trash Removal Contract fifteen
(15) days prior to the Commencement Date, Landlord shall obtain the
Trash Removal Contract for Tenant's benefit and Tenant shall be
obligated to pay Landlord, as Additional Rent, monthly, without
demand, one-twelfth (1/12th) of the annual cost of the Trash
Removal Contract. Regardless if Landlord or Tenant obtains the
Trash Removal Contract, Landlord shall have the right to enter
Tenant's Premises to inspect the services provided thereunder.
(d) If Tenant fails to maintain or repair the Premises
as required by this Section 6.04, Landlord may, upon ten (10) days
prior notice to Tenant (except that no notice shall be required in
the case of an emergency), enter the Premises and perform such
maintenance or repair on behalf of Tenant. In such case, Tenant
shall reimburse Landlord for all costs incurred in performing such
maintenance or repair, including twenty percent (20%) of such costs
for Landlord's supervision, immediately upon demand.
Section 6.05 ALTERATIONS, ADDITIONS, AND IMPROVEMENTS.
(a) Tenant shall not make any alterations, additions, or
improvements to the Premises without Landlord's prior written
consent. Tenant shall deliver to Landlord, for Landlord's approval
prior to any construction, a complete set of plans and
specifications for the proposed alterations, additions or
improvements, copies of contracts with general contractors,
evidence of contractor's insurance and bonds, and all necessary
permits for such construction. Landlord may require Tenant to
provide demolition and/or lien and completion bonds in form and
amount satisfactory to Landlord. Tenant shall promptly remove any
alterations, additions, or improvements constructed in violation of
this Section 6.05(a) upon Landlord's written request. All
alterations, additions, and improvements will be accomplished in a
good and workmanlike manner, in conformity with all applicable
Laws, and by a contractor approved by Landlord. Landlord's
approval of the plans, specifications and working drawings for
Tenant's alterations shall create no responsibility or liability on
the part of Landlord for their completeness, design, sufficiency,
or compliance with all laws, rules and regulations of governmental
agencies or authorities. Upon completion of any such work, Tenant
shall provide Landlord with "as built" plans, copies of all
construction contracts, and proof of payment for all labor and
materials.
(b) Tenant shall pay when due all claims for labor and
material furnished to the Premises. Tenant shall give Landlord at
least ten (10) days prior written notice of the commencement of any
work on the Premises. Landlord may elect to record and post
notices of non-responsibility on the Premises.
Section 6.06 CONDITION UPON TERMINATION. Upon the
termination of this Lease, Tenant shall surrender the Premises to
Landlord, broom clean and in the same condition as received except
for ordinary wear and tear which Tenant was not otherwise obligated
to remedy under any provision of this Lease. In addition, Landlord
may require Tenant to remove any alterations, additions or
improvements (whether or not made with Landlord's consent) by
written notice to Tenant within thirty (30) days after the
termination of this Lease and to restore the Premises to its prior
condition, all at Tenant's expense. All alterations, additions and
improvements which Landlord has not required Tenant to remove shall
become Landlord's property and shall be surrendered to Landlord
upon the termination of the Lease, except that Tenant may remove
any of Tenant's machinery or equipment which can be removed without
material damage to the Premises. Tenant shall repair, at Tenant's
expense, any damage to the Premises caused by the removal of any
such machinery or equipment. In no event, however, shall Tenant
remove any of the following materials or equipment without
Landlord's prior written consent: any power wiring or power panels;
lighting or lighting fixtures; wall coverings; drapes, blinds or
other window coverings; carpets or other floor coverings; heaters,
air conditioners or any other heating or air conditioning
equipment; fencing or security gates; or other similar building
operating equipment and decorations.
ARTICLE SEVEN
DAMAGE OR DESTRUCTION
Section 7.01 PROPERTY DAMAGE. If the Premises or any part
thereof shall be damaged by fire or other peril, Tenant shall give
prompt written notice thereof to Landlord. In case the Building
shall be so damaged that substantial alteration, repair or
reconstruction of any portion of the Building shall, in Landlord's
sole opinion, be required (whether or not the Premises shall have
been damaged by such peril) or in the event any Mortgagee shall
require that the insurance proceeds payable as a result of a peril
be applied to the payment of the mortgage debt or in the event of
any material uninsured loss to the Building, Landlord may, at its
option, terminate this Lease by notifying Tenant in writing of such
termination within ninety (90) days after the date of such
casualty. If Landlord does not thus elect to terminate this Lease,
Landlord shall, as Landlord's sole obligation, commence and proceed
with reasonable diligence to restore the Building Shell to
substantially the same condition in which it was immediately prior
to the occurrence of the peril. When the Building Shell has been
restored by Landlord, Landlord or Tenant, at Landlord's option,
shall complete the restoration of the Premises, including the
reconstruction of all improvements in order to complete the
Premises and restore the Premises to the same condition and build-
out as prior to the casualty. If Tenant is responsible for such
restoration of the Premises, any plans and specifications for such
restoration and reconstruction and the contractor retained by
Tenant for such restoration and reconstruction shall be subject to
the approval of Landlord. Any shortfall between the amount of
insurance proceeds and the actual costs of such reconstruction
shall be deposited by Tenant prior to the commencement of such
reconstruction and, if additional costs occur, immediately upon
demand therefor. All insurance proceeds payable pursuant to
policies maintained by Tenant pursuant to Section 4.05 shall be
applied by Tenant to such reconstruction. Landlord shall not be
liable for any inconvenience or annoyance to Tenant or injury to
the business of Tenant resulting in any way from such damage or the
repair thereof, except as set forth in Section 7.02 below.
Section 7.02 REDUCTION OF RENT. If the Premises is
destroyed or damaged and Landlord or Tenant repairs or restores the
Premises pursuant to the provisions of this Article Seven, any Base
Rent payable during the period commencing as of the date of the
casualty and continuing for the period of time, as determined by
Landlord, required for Tenant and Landlord to complete the repairs
described in this Article Seven, due to such damage, repair and/or
restoration shall be reduced according to the degree, if any, to
which Tenant's use of the Premises is impaired as of the date of
the casualty as determined by Landlord. If any casualty is the
result of the fault or negligence of Tenant or any of Tenant's
agents, employees or invitees, the Base Rent hereunder shall not be
diminished during the repair of such damage. Except for such
possible reduction in Base Rent, Tenant shall not be entitled to
any abatement, compensation, reduction, or reimbursement from
Landlord as a result of any damage, destruction, repair, or
restoration of or to the Premises. In the event this Lease is
terminated pursuant to this Article Seven, such termination shall
be effective as of the date of the casualty.
Section 7.03 WAIVER. Tenant waives the protection of any
statute, code or judicial decision which grants a tenant the right
to terminate a lease in the event of the substantial destruction of
the leased property. Tenant agrees that the provisions of this
Article Seven above shall govern the rights and obligations of
Landlord and Tenant in the event of any casualty to the Premises.
ARTICLE EIGHT
CONDEMNATION
Section 8.01 CONDEMNATION. If the whole or substantially
the whole of the Building or the Premises shall be taken for any
public or quasi-public use, by right of eminent domain or otherwise
or shall be sold in lieu of condemnation, then this Lease shall
terminate as of the date when physical possession of the Building
or the Premises is taken by the condemning authority. If less than
the whole or substantially the whole of the Building or the
Premises is thus taken or sold, Landlord (whether or not the
Premises are affected thereby) may terminate this Lease by giving
written notice thereof to Tenant; in which event this Lease shall
terminate as of the date when physical possession of such portion
of the Building or Premises is taken by the condemning authority.
If the Lease is not so terminated upon any such taking or sale, the
Rent payable hereunder shall be diminished by an equitable amount,
and Landlord shall, to the extent Landlord deems feasible, restore
the Building and the Premises to substantially their former
condition, but such work shall not exceed the scope of the work
done by Landlord in originally constructing the Building and
installing improvements in the Premises, nor shall Landlord in any
event be required to spend for such work an amount in excess of the
amount received by Landlord as compensation for such taking. All
amounts awarded upon a taking of any part or all of the Building or
the Premises shall belong to Landlord, and Tenant shall not be
entitled to and expressly waives all claims to any such
compensation.
ARTICLE NINE
ASSIGNMENT AND SUBLETTING
Section 9.01 LANDLORD'S CONSENT REQUIRED. No portion of the
Premises or of Tenant's interest in this Lease may be acquired by
any other person or entity, whether by assignment, mortgage,
sublease, transfer, operation of law, or act of Tenant, without
Landlord's prior written consent. Any attempted transfer without
consent shall be void and shall constitute a non-curable breach of
this Lease. If Tenant is a partnership, any cumulative transfer of
more than twenty percent (20%) of the partnership interests shall
require Landlord's consent. If Tenant is a corporation, any change
in a controlling interest of the voting stock of the corporation
shall require Landlord's consent.
Section 9.02 LANDLORD'S ELECTION. Tenant's request for
consent to any transfer described in Section 9.01 above shall be
accompanied by a written statement setting forth the details of the
proposed transfer, including the name, business and financial
condition of the prospective transferee, financial details of the
proposed transfer (e.g., the term of and rent and security deposit
payable under any assignment or sublease), and any other
information Landlord deems relevant. Landlord shall have the right
in Landlord's sole discretion (a) to withhold consent; (b) to grant
consent; or (c) if the transfer is a sublease of the Premises or an
assignment of this Lease, to terminate this Lease as of the
effective date of such sublease or assignment, in which case
Landlord may elect to enter into a direct lease with the proposed
assignee or subtenant. If Landlord consents to any assignment or
sublease and Tenant receives rent or other consideration, either
initially or over the term of the assignment or sublease, in excess
of the Rent called for hereunder, or, in case of the sublease of a
portion of the Premises, in excess of such Rent fairly allocable to
such portion ("Profits"), then Tenant shall pay Landlord, as
Additional Rent hereunder, promptly after its receipt, fifty
percent (50%) of such Profits.
Section 9.03 NO RELEASE OF TENANT. No transfer consented to
by Landlord, shall release Tenant or change Tenant's primary
liability to pay the rent and to perform all other obligations of
Tenant under this Lease. Upon the occurrence of any default under
this Lease, Landlord may proceed directly against Tenant without
the necessity of exhausting any remedies against any subtenant or
assignee. Upon termination of this Lease, any permitted subtenant
shall, at Landlord's option, attorn to Landlord and shall pay all
Rent directly to Landlord. Landlord's acceptance of Rent from any
other person shall not constitute a waiver of any provision of this
Article Nine. Consent to one transfer shall not constitute a
consent to any subsequent transfer. Landlord may consent to
subsequent assignments or modifications of this Lease by Tenant's
transferee, without notifying Tenant or obtaining its consent.
Such action shall not relieve Tenant of its liability under this
Lease.
Section 9.04 NO MERGER. No merger shall result from
Tenant's sublease of the Premises under this Article Nine, Tenant's
surrender of this Lease or the termination of this Lease in any
other manner. In any such event, Landlord may terminate any or all
subtenancies or succeed to the interest of Tenant as sublandlord
thereunder.
ARTICLE TEN
DEFAULTS; REMEDIES
Section 10.01 COVENANTS AND CONDITIONS. Tenant's performance
of each of Tenant's obligations under this Lease is a condition as
well as a covenant. Tenant's right to continue in possession of
the Premises is conditioned upon such performance. Time is of the
essence in the performance of all covenants and conditions.
Section 10.02 DEFAULTS. Tenant shall be in material default
under this Lease:
(a) If Tenant abandons the Premises or if Tenant vacates
the Premises for thirty (30) consecutive days;
(b) If Tenant fails to pay Rent or any other charge
required to be paid by Tenant, as and when due;
(c) If Tenant fails to perform any of Tenant's
nonmonetary obligations under this Lease for a period of ten (10)
days after written notice from Landlord; provided that if more than
ten (10) days are required to complete such performance, Tenant
shall not be in default if Tenant commences such performance within
such ten (10) day period and thereafter diligently pursues its
completion;
(d)(i) If Tenant makes a general assignment or general
arrangement for the benefit of creditors; (ii) if a petition for
adjudication of bankruptcy or for reorganization or rearrangement
is filed by or against Tenant and is not dismissed within thirty
(30) days; (iii) if a trustee or receiver is appointed to take
possession of substantially all of Tenant's assets located at the
Premises or of Tenant's interest in this Lease and possession is
not restored to Tenant within thirty (30) days; or (iv) if
substantially all of Tenant's assets located at the Premises or of
Tenant's interest in this Lease is subjected to attachment,
execution or other judicial seizure which is not discharged within
thirty (30) days. If a court of competent jurisdiction determines
that any of the acts described in this Section (d) is not a default
under this Lease, and a trustee is appointed to take possession (or
if Tenant remains a debtor in possession) and such trustee or
Tenant transfers Tenant's interest hereunder, then Landlord shall
receive, as Additional Rent, the difference between the rent (or
any other consideration) paid in connection with such assignment or
sublease and the rent payable by Tenant hereunder;
(e) Any representation or warranty made by Tenant or by
a subtenant or assignee in connection with this Lease shall have
been false or misleading as of the date such representation or
warranty was made; or
(f) If Tenant fails to take substantial occupancy of the
Premises within a reasonable time after the Commencement Date.
Section 10.03 REMEDIES. On the occurrence of any default by
Tenant, Landlord may, at any time thereafter, with or without
notice or demand and without limiting Landlord in the exercise of
any right or remedy which Landlord may have:
(a) Terminate Tenant's right to possession of the
Premises by any lawful means, in which case this Lease shall
terminate and Tenant shall immediately surrender possession of the
Premises to Landlord. In such event, Landlord shall be entitled to
recover from Tenant all damages incurred by Landlord by reason of
Tenant's default, including without limitation (i) the worth at the
time of the award of the unpaid Base Rent, Additional Rent and
other charges which had been earned at the time of the termination;
(ii) the worth at the time of the award of the amount by which the
unpaid Base Rent, Additional Rent and other charges which would
have been earned after termination until the time of the award
exceeds the amount of such rental loss that Tenant proves could
have been reasonably avoided; (iii) the worth at the time of the
award of the amount by which the unpaid Base Rent, Additional Rent
and other charges which would have been paid for the balance of the
Lease Term after the time of award exceeds the amount of such
rental loss that Tenant proves could have been reasonably avoided;
and (iv) any other amount necessary to compensate Landlord for all
the detriment proximately caused by Tenant's failure to perform its
obligations under the Lease or which in the ordinary course of
things would be likely to result therefrom, including, but not
limited to, any costs or expenses incurred by Landlord in
maintaining or preserving the Premises after such default, the cost
of recovering possession of the Premises, expenses of reletting,
including necessary renovation or alteration of the Premises,
Landlord's reasonable attorneys' fees incurred in connection
therewith, and any real estate commission paid or payable. As used
in subparts (i) and (ii) above, the "worth at the time of the
award" is computed by allowing interest on unpaid amounts at the
rate of fifteen percent, or such lesser amount as may then be the
maximum lawful rate, accruing the date such payments are due until
paid. As used in subpart (iii) above, the "worth at the time of
the award" is computed by discounting such amount at the discount
rate of the Federal Reserve Bank of San Francisco at the time of
the award, plus one percent (1%);
(b) Maintain Tenant's right to possession, in which case
this Lease shall continue in effect whether or not Tenant shall
have abandoned the Premises. In such event, Landlord shall be
entitled to enforce all of Landlord's rights and remedies under
this Lease, including the right to recover Rent as it becomes due
hereunder. Landlord's election to maintain Tenant's right to
possession shall not prejudice Landlord's right, at any time
thereafter to terminate Tenant's right to possession and proceed in
accordance with Section 10.03(a) above; or
(c) Pursue any other remedy now or hereafter available
to Landlord under the laws or judicial decisions of the State of
Nevada.
Section 10.04 CUMULATIVE REMEDIES. Landlord's exercise of
any right or remedy shall not prevent it from exercising any other
right or remedy.
ARTICLE ELEVEN
PROTECTION OF LENDERS
Section 11.01 SUBORDINATION. Landlord shall have the right
to subordinate this Lease to any ground lease, deed of trust or
mortgage encumbering the Premises, any advances made on the
security thereof and any renewals, modifications, consolidations,
replacements or extensions thereof, whenever made or recorded.
However, Tenant's right to quiet possession of the Premises during
the Lease Term shall not be disturbed if Tenant pays the rent and
performs all of Tenant's obligations under this Lease and is not
otherwise in default. If any ground lessor, beneficiary or
mortgagee elects to have this Lease prior to the lien of its ground
lease, deed of trust or mortgage and gives written notice thereof
to Tenant, this Lease shall be deemed prior to such ground lease,
deed of trust or mortgage whether this Lease is dated prior or
subsequent to the date of said ground lease, deed of trust or
mortgage or the date of recording thereof. If in connection with
obtaining construction, interim or permanent financing for the
Building, the lender shall request modifications to this Lease as
a condition to such financing, Tenant will not withhold or delay
its consent thereto, provided that such modifications do not
increase the obligations of Tenant hereunder and do not otherwise
materially adversely affect Tenant's rights hereunder. In the
event that Tenant should fail to execute any instrument described
in this Article Eleven promptly as requested, Tenant hereby
irrevocably constitutes Landlord as its attorney-in-fact to execute
such instrument in Tenant's name, place and stead, it being agreed
that such power is one coupled with an interest.
Section 11.02 ATTORNMENT. If Landlord's interest in the
Premises is acquired by any ground lessor, beneficiary under a deed
of trust, mortgagee, or purchaser at a foreclosure sale, Tenant
shall attorn to the transferee of or successor to Landlord's
interest in the Premises and recognize such transferee or successor
as Landlord under this Lease. Tenant waives the protection of any
statute or rule of law which gives or purports to give Tenant any
right to terminate this Lease or surrender possession of the
Premises upon the transfer of Landlord's interest.
Section 11.03 SIGNING OF DOCUMENTS. Tenant shall sign and
deliver any instruments or documents necessary or appropriate to
evidence any such attornment or subordination or agreement to do
so. Such subordination and attornment documents may contain such
provisions as are customarily required by any ground lessor,
beneficiary under a deed of trust or mortgagee. If Tenant fails to
do so within ten (10) days after written request, Tenant hereby
makes, constitutes and irrevocably appoints Landlord, or any
transferee or successor of Landlord, the attorney-in-fact of Tenant
to execute and deliver any such instrument or document.
Section 11.04 ESTOPPEL CERTIFICATES.
(a) Upon Landlord's written request, Tenant shall
execute, acknowledge and deliver to Landlord a written statement
certifying; (i) that none of the terms or provisions of this Lease
have been changed (or if they have been changed, stating how they
have been changed); (ii) that this Lease has not been canceled or
terminated; (iii) the last date of payment of the Base Rent and
other charges and the time period covered by such payment; (iv)
that Landlord is not in default under this Lease (or, if Landlord
is claimed to be in default, stating why); and (v) such other
matters as may be reasonably required by Landlord or the holder of
a mortgage, deed of trust or lien to which the Premises is or
becomes subject. Tenant shall deliver such statement to Landlord
within ten (10) days after Landlord's request. Any such statement
by Tenant may be given by Landlord to any prospective purchaser or
encumbrancer of the Premises. Such purchaser or encumbrancer may
rely conclusively upon such statement as true and correct.
(b) If Tenant does not deliver such statement to
Landlord within such ten (10) day period, Landlord, and any
prospective purchaser or encumbrancer, may conclusively presume and
rely upon the following facts: (i) that the terms and provisions of
this Lease have not been changed except as otherwise represented by
Landlord; (ii) that this Lease has not been canceled or terminated
except as otherwise represented by Landlord; (iii) that not more
than one month's Base Rent or other charges have been paid in
advance; and (iv) that Landlord is not in default under the Lease.
In such event, Tenant shall be estopped from denying the truth of
such facts.
Section 11.05 TENANT'S FINANCIAL CONDITION. Within ten (10)
days after written request from Landlord, Tenant shall deliver to
Landlord such financial statements as are reasonably required by
Landlord to verify the net worth of Tenant, or any assignee,
subtenant, or guarantor of Tenant. In addition, Tenant shall
deliver to any lender designated by Landlord any financial
statements required by such lender to facilitate the financing or
refinancing of the Premises. Tenant represents and warrants to
Landlord that each such financial statement is a true and accurate
statement as of the date of such statement. All financial
statements shall be confidential and shall be used only for the
purposes set forth herein.
ARTICLE TWELVE
LEGAL COSTS
Section 12.01 LEGAL PROCEEDINGS. Tenants shall reimburse
Landlord, upon demand, for any costs or expenses incurred by
Landlord in connection with any breach or default of Tenant under
this Lease, whether or not suit is commenced or judgment entered.
Such costs shall include legal fees and costs incurred for the
negotiation of a settlement, enforcement of rights or otherwise.
Furthermore, if any action for breach of or to enforce the
provisions of this Lease is commenced, the court in such action
shall award to the party in whose favor a judgment is entered, a
reasonable sum as attorneys' fees and costs. Such attorneys' fees
and costs shall be paid by the losing party in such action and
Tenant shall also indemnify Landlord against and hold Landlord
harmless from all costs, expenses, demands and liability incurred
by Landlord if Landlord becomes or is made a party to any claim or
action (a) instituted by Tenant, or by any third party against
Tenant, or by or against any person holding any interest under or
using the Premises by license of or agreement with Tenant; (b) for
foreclosure of any lien for labor or material furnished to or for
Tenant or such other person; (c) otherwise arising out of or
resulting from any act or transaction of Tenant or such other
person; or (d) necessary to protect Landlord's interest under this
Lease in a bankruptcy proceeding, or other proceeding under Title
11 of the United States Code, as amended. Tenant shall defend
Landlord against any such claim or action at Tenant's expense with
counsel reasonably acceptable to Landlord or, at Landlord's
election, Tenant shall reimburse Landlord for any legal fees or
costs incurred by Landlord in any such claim or action.
Section 12.02 LANDLORD'S CONSENT. Tenant shall pay
Landlord's reasonable attorneys' fees incurred in connection with
Tenant's request for Landlord's consent under Article Nine
(Assignment and Subletting), or in connection with any other act
which Tenant proposes to do and which requires Landlord's consent.
ARTICLE THIRTEEN
MISCELLANEOUS PROVISIONS
Section 13.01 NON-DISCRIMINATION. Tenant promises, and it is
a condition to the continuance of this Lease, that there will be no
discrimination against, or segregation of, any person or group of
persons on the basis of race, color, sex, creed, national origin or
ancestry in the leasing, subleasing transferring, occupancy, tenure
or use of the Premises or any portion thereof.
Section 13.02 LANDLORD'S LIABILITY. As used in this Lease,
the term "Landlord" means only the current owner or owners of the
fee title to the Premises or the leasehold estate under a ground
lease of the Premises at the time in question. Each Landlord is
obligated to perform the obligations of Landlord under this Lease
only during the time such Landlord owns such interest or title.
Any Landlord who transfers its title or interest is relieved of all
liability with respect to the obligations of Landlord under this
Lease to be performed on or after the date of transfer. However,
each Landlord shall deliver to its transferee all funds previously
paid by Tenant if such funds have not yet been applied under the
terms of this Lease. The liability of Landlord to Tenant for any
default by Landlord under the terms of this Lease shall be limited
to the lesser of (i) the interest of Landlord in the Building, or
(ii) the interest Landlord would have in the Building if the
Building were encumbered by third party debt in an amount equal to
eighty percent (80%) of the value of the Building (as such value is
determined by Landlord) and Tenant agrees to look solely to such
amount for recovery of any judgment from Landlord, it being
intended that Landlord shall not be personally liable for any
judgment or deficiency.
Section 13.03 SEVERABILITY. A determination by a court of
competent jurisdiction that any provision of this Lease or any part
thereof is illegal or unenforceable shall not cancel or invalidate
the remainder of such provision or this Lease, which shall remain
in full force and effect.
Section 13.04 INTERPRETATION. The captions of the Articles
and Sections of this Lease are to assist the parties in reading
this Lease and are not a part of the terms or provisions of this
Lease. Whenever required by the context of this Lease, the
singular shall include the plural and the plural shall include the
singular. The masculine, feminine and neuter genders shall each
include the other. In any provision relating to the conduct, acts
or omissions of Tenant, the term "Tenant" shall include Tenant's
agents, employees, contractors, invitees, successors or others
using the Premises with Tenant's expressed or implied permission.
Section 13.05 INCORPORATION OF PRIOR AGREEMENTS; MODIFICATIONS.
This Lease is the only agreement between the parties
pertaining to the lease of the Premises and no other agreements are
effective. All amendments to this Lease shall be in writing and
signed by all parties. Any other attempted amendment shall be
void.
Section 13.06 NOTICES. All notices required or permitted
under this Lease shall be in writing and shall be personally
delivered or sent by certified mail, return receipt requested,
postage prepaid. Notices to Tenant shall be delivered to Tenant's
Address specified in Section 1.01(s) above, except that upon
Tenant's taking possession of the Premises, the Premises shall be
Tenant's address for notice purposes. Notices to Landlord shall be
delivered to Landlord's Address specified in Section 1.01(h) above.
Notices deposited in the mail in the manner hereinabove described
shall be effective from and after the expiration of three (3)
calendar days after it is so deposited. All other notices shall be
effective upon delivery or attempted delivery in accordance with
this Section 13.06. Either party may change its notice address
upon written notice to the other party.
Section 13.07 WAIVERS. All waivers must be in writing and
signed by the waiving party. Landlord's failure to enforce any
provision of this Lease or its acceptance of rent shall not be a
waiver and shall not prevent Landlord from enforcing that provision
or any other provision of this Lease in the future. No statement
on a payment check from Tenant or in a letter accompanying a
payment check shall be binding on Landlord, and Landlord may, with
or without notice to Tenant, negotiate such check without being
bound to the conditions of such statement.
Section 13.08 NO RECORDATION. Tenant shall not record this
Lease without prior written consent from Landlord. However, either
Landlord or Tenant may require that a "short form" memorandum of
this Lease executed by both parties be recorded; provided that, in
such event, Tenant hereby covenants and agrees that, upon the
expiration or earlier termination of the Lease Term, Tenant will
execute and deliver a quitclaim deed to Landlord in form reasonably
satisfactory to Landlord, in favor of Landlord, or Landlord's
successor in interest releasing and conveying any and all right,
title, or interest of Tenant in the Premises, the Building, and the
▇▇▇▇▇▇ Airport Center.
Section 13.09 BINDING EFFECT; CHOICE OF LAW. This Lease
binds any party who legally acquires any rights or interest in this
Lease from Landlord or Tenant. However, Landlord shall have no
obligation to Tenant's successor unless the rights or interests of
Tenant's successor are acquired in accordance with the terms of
this Lease. This Lease shall be governed by and construed in
accordance with the laws of the State of Nevada.
Section 13.10 CORPORATE AUTHORITY; PARTNERSHIP AUTHORITY.
If Tenant is a corporation, each person signing this Lease on
behalf of Tenant represents and warrants that he has full authority
to do so and that this Lease binds the corporation. Within thirty
(30) days after this Lease is signed, Tenant shall deliver to
Landlord a certified copy of a resolution of Tenant's Board of
Directors authorizing the execution of this Lease or other evidence
of such authority reasonably acceptable to Landlord. If Tenant is
a partnership, each person signing this Lease for Tenant represents
and warrants that he is a general partner of the partnership, that
he has full authority to sign for the partnership and that this
Lease binds the partnership and all general partners of the
partnership. Tenant shall give written notice to Landlord of any
general partner's withdrawal or addition. Within thirty (30) days
after this Lease is signed, Tenant shall deliver to Landlord a copy
of Tenant's recorded statement of partnership or certificate of
limited partnership.
Section 13.11 JOINT AND SEVERAL LIABILITY. All parties
signing this Lease as Tenant shall be jointly and severally liable
for all obligations of Tenant.
Section 13.12 FORCE MAJEURE. If Landlord cannot perform any
of its obligations due to events beyond Landlord's control, the
time provided for performing such obligations shall be extended by
a period of time equal to the duration of such events. Events
beyond Landlord's control include, but are not limited to, acts of
God, war, civil commotion, labor disputes, strikes, fire, flood or
other casualty, shortages of labor or material, governmental
regulation or restriction and weather conditions.
Section 13.13 EXECUTION OF LEASE. This Lease may be executed
in counterparts, and, when all counterpart documents are executed,
the counterparts shall constitute a single binding instrument. The
delivery of this Lease by Landlord to Tenant shall not be deemed to
be an offer and shall not be binding upon either party until
executed and delivered by both parties.
Section 13.14 BROKERS AND LEASING AGENTS. Landlord represents
and warrants to Tenant, and Tenant represents and warrants to
Landlord, that no broker, leasing agent or finder has been engaged
by it other than Tenant's Broker (if any) specified in Section
1.01(t) in connection with any of the transactions contemplated by
this Lease, or to its knowledge is in any way connected with any of
such transactions. Subject to the terms and conditions of a
written commission agreement ("Commission Agreement") entered into
between Landlord and Tenant's Broker (if any), Landlord shall be
responsible for the payment of a commission to Tenant's Broker in
accordance with the Commission Agreement. In the event of any
claims for brokers' or finders' fees or commissions in connection
with the negotiation, execution or consummation of this Lease other
than by the Tenant's Broker (if any), Tenant shall indemnify, save
harmless and defend Landlord from and against such claims if they
shall be based upon any statement or representation or agreement
made by Tenant, and Landlord shall indemnify, save harmless and
defend Tenant if such claims shall be based upon any statement,
representation or agreement made by Landlord.
Section 13.15 RULES AND REGULATIONS. Tenant shall faithfully
observe and comply with the "Rules and Regulations," a copy of
which is Exhibit "C" attached hereto and incorporated herein by
this reference and all reasonable modifications thereof and
additions thereto from time to time put into effect by Landlord.
Landlord shall not be responsible to Tenant for the violation or
non-performance by any other tenant or occupant of the Building of
any of said Rules and Regulations. Tenant shall be responsible for
the observance of all the foregoing rules by Tenant's employees,
agents, clients, customers, invitees and guests.
Section 13.16 BUILDING PLANNING. In the event Landlord
requires the Premises for use in conjunction with another suite or
for other reasons connected with the Building planning program,
upon notifying Tenant in writing, Landlord shall have the right to
move Tenant to another space in the Building at Landlord's sole
cost and expense, including all of Tenant's moving expenses,
telephone installation and stationery reprinting charges, and the
terms and conditions of the original Lease shall remain in full
force and effect, save and excepting that a revised Exhibit "A"
shall become part of this Lease and shall reflect the location of
the new space and this Lease shall be amended to include and state
all correct data as to the new space.
Section 13.17 LIENS. Tenant shall not permit any mechanic's,
materialmen's or other liens to be filed against the real property
of which the Premises form a part nor against the Tenant's
leasehold interest in the Premises. Landlord 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 filed and are not discharged by Tenant by
bond or otherwise within ten (10) days after the filing thereof,
Landlord may, without waiving its rights and remedies based on such
breach of Tenant and without releasing Tenant from any of its
obligations, cause such liens to be released by any means it shall
deem proper, including payment in satisfaction of the claim giving
rise to such lien. Tenant shall pay to Landlord at once, upon
notice by Landlord, any sum paid by Landlord to remove such liens,
together with interest at the maximum rate per annum permitted by
law from the date of such payment by Landlord.
IN WITNESS WHEREOF, Landlord and Tenant have signed this Lease
in the State of Nevada on the day and year first above written and
have initialed all Riders which are attached to or incorporated by
reference in this Lease.
LANDLORD: TENANT:
▇▇▇▇▇▇ ▇▇▇▇▇▇ PROPERTIES, SPINTEK GAMING TECHNOLOGIES,
LIMITED PARTNERSHIP, a INC., a California corporation
Delaware limited partnership
By its sole general partner: By: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ /s/
THE ▇▇▇▇▇▇ ▇▇▇▇▇▇ CORPORATION,
a Delaware corporation Print Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Print Title: CFO
By: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇ /s/
Print Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Print Title: Executive V.P.
EXHIBIT "A"
[Building Depiction Indicating Location of Premises]
EXHIBIT "B"
[Legal Description of Building Site]
EXHIBIT "C"
RULES AND REGULATIONS
1. No sign, placard, picture, advertisement, name or notice
shall be installed or displayed on any part of the outside or
inside of the Building without the prior written consent of
Landlord. Tenant shall not do any painting or marking on the
exterior of the Building or the Building Common Areas, including
without limitation, marking of parking areas. Landlord shall have
the right to remove, at Tenant's expense and without notice, any
sign installed or displayed in violation of this rule. All
approved signs or lettering on doors, windows and walls shall be
printed, painted, affixed or inscribed at the expense of Tenant,
using materials and in a style and format approved by Landlord.
2. Window coverings must be approved by Landlord which
approval shall not be unreasonably withheld. No awning shall be
permitted on any part of the Premises. Tenant shall not place
anything against or near glass partitions or doors or windows which
may appear unsightly from outside the Premises.
3. Tenant shall not obstruct any sidewalks, halls, passages,
exits, entrances, elevators, escalators or stairways of the
Building. The halls, passages, exits, entrances, elevators,
escalators are not for the general public, and Landlord shall in
all cases retain the right to control and prevent access thereto of
all persons whose presence in the judgment of Landlord would be
prejudicial to the safety, character, reputation and interests of
the Building and its tenants; provided that nothing herein
contained shall be construed to prevent such access to persons with
whom any tenant normally deals in the ordinary course of its
business, unless such persons are engaged in illegal activities.
No tenant and no employee or invitee of any tenant shall go upon
the roof of the Building, without the approval of Landlord.
4. Landlord will furnish Tenant, free of charge, with two
keys to each door lock in the Premises, provided, however, that
Landlord shall not be entitled to possess keys to any safes; files,
vaults, safe deposit boxes or keys to the Premises. Without
Landlord's consent, Tenant shall not make or have made additional
keys furnished by Landlord. Unless Landlord otherwise agrees,
Tenant shall not alter any lock or install a new additional lock or
bolt on any door of its Premises. Tenant, upon the termination of
its tenancy, shall deliver to Landlord the keys of all doors which
have been furnished to Tenant, and in the event of loss of any keys
furnished shall pay Landlord therefor.
5. If Tenant requires telegraphic, telephonic, or similar
services, it shall first obtain, and comply with, Landlord's
instructions in their installation.
6. Tenant shall comply with all applicable regulations,
laws, and standards, including, but not limited, to OSHA rules and
regulation, if the Premises contains any kerosene, gasoline or
inflammable or combustible fluid or material other than those
limited quantities necessary for the operation or maintenance of
office equipment. Tenant shall not use or permit to be used in the
Premises any foul or noxious gas or substance, or permit or allow
the Premises to be occupied or used in a manner offensive or
objectionable to Landlord or other occupants of the Building by
reason of noise, odors or vibrations, nor shall Tenant bring into
or keep in or about the Premises any birds or animals.
7. Without the consent of Landlord, Tenant shall not use any
method of heating or air-conditioning other than that supplied by
Landlord.
8. Tenant shall not waste electricity, water or air-
conditioning and agrees to cooperate fully with Landlord to assure
the most effective operation of the Building's heating and air-
conditioning and to comply with any governmental energy-saving
rules, laws or regulations of which Tenant has actual notice, and
shall refrain from attempting to adjust controls other than room
thermostats installed for Tenant's use.
9. The toilet rooms, toilet urinals, wash bowls and other
apparatus shall not be used for any purpose other than that for
which they were constructed and no foreign substance of any kind
whatsoever shall be thrown therein.
10. Unless otherwise approved by Landlord, Tenant shall not
sell, or permit the sale of newspapers, magazines, periodicals,
theater tickets or any other goods or merchandise to the general
public in or on the Premises. Tenant shall not make any room-to-
room solicitation of business from other tenants in the Building.
Tenant shall not use the Premises for any business or activity
other than that specifically provided for in Tenant's Lease.
11. Unless approved by Landlord, Tenant shall not install any
radio or television antenna, microwave dishes, loudspeaker or other
device on the roof or exterior walls of the Building. Tenant shall
not interfere with radio or television broadcasting or reception
from or in the Building or elsewhere.
12. Tenant shall not cut or bore holes for wires without
Landlord's approval. Tenant shall not affix any floor covering to
the floor of the Premises in any manner except as approved by
Landlord.
13. Landlord reserves the right to exclude or expel from the
Building any person who, in Landlord's judgment, is intoxicated or
under the influence of liquor or drugs or who is in violation of
any of the Rules and Regulations of the Building.
14. Tenant shall store all its trash and garbage within its
designated trash area. Tenant shall not place in any trash box or
receptacle any material which cannot be disposed of in the ordinary
and customary manner of trash and garbage disposal. All garbage
and refuse disposal shall be made in accordance with directions
issued from time to time by Landlord.
15. The Premises shall not be used for the storage of
merchandise held for sale to the general public except to the
extent incidental to Tenant's use of the Premises, or for lodging,
nor shall the Premises be used for any improper, immoral or
objectionable purpose. No cooking shall be done or permitted by
any tenant on the Premises, (except as permitted in these Rules and
Regulations as to operating an employee cafeteria). Use by Tenant
of equipment for brewing coffee, tea, hot chocolate and similar
beverages shall be permitted, and the use of a microwave shall be
permitted, provided that such equipment and use is in accordance
with all applicable federal, state, county and city laws, codes,
ordinances and regulations.
16. Without the written consent of Landlord, Tenant shall not
use the name of the Building in connection with or in promoting or
advertising the business of Tenant except as Tenant's address.
17. Tenant shall comply with all safety, fire protection and
evacuation procedures and regulations established by Landlord or
any governmental agency.
18. Tenant assumes any and all responsibility for protecting
its Premises from theft, robbery and pilferage, which includes
keeping doors locked and other means of entry to the Premises
closed.
19. Tenant shall comply with the system reasonably
established by Landlord from time to time for Tenant to report
cleaning, maintenance and repair, or other work which is required
under this Lease.
20. Tenant shall not park its vehicles in any parking areas
designated for parking by visitors to the Building. Tenant shall
not park any vehicles in the Building parking areas other than
automobiles, motorcycles, motor driven or non-motor driven bicycles
or four-wheeled trucks. Landlord may, in its sole discretion,
designate separate areas for bicycles and motorcycles.
21. Landlord may waive any one or more of these Rules and
Regulations for the benefit of Tenant or any other tenant, but no
such waiver by Landlord shall be construed as a waiver of such
Rules and Regulations in favor of Tenant or any other tenant, nor
prevent Landlord from thereafter enforcing any such Rules and
Regulations against any or all of the tenants of the Building.
22. Landlord reserves the right to make such other and
reasonable Rules and Regulations as, in its judgment, may from time
to time be needed for safety and security, for care and cleanliness
of the Building and for the preservation of good order therein.
Tenant agrees to abide by all such Rules and Regulations
hereinabove stated and any additional rules and regulations which
are adopted.
23. Tenant shall be responsible for the observance of all of
the foregoing rules by Tenant's employees and agents.
24. Tenant shall maintain exterior loading docks and bay
areas in a neat and clean manner. Permanent outside storage of
pallets, packing crates, barrels, etc. is prohibited. Tenant shall
dispose of refuse in a manner which prevents littering and
dispersing of refuse by wind.
25. Landlord reserves the right, exercisable without
liability to Tenant, to change the name and street address of the
Building.
26. Landlord reserves the right to modify and/or adopt such
other reasonable and nondiscriminatory rules and regulations for
the parking areas as it deems necessary for the operation of the
parking area. Landlord may refuse to permit any person who
violates the within rules to park in the parking area, and any
violation of the rules shall subject the car to removal.
27. All directional signs and arrows must be observed. The
speed limit shall be 5 miles per hour. Parking is prohibited: (a)
in areas not striped for parking, (b) in aisles, (c) where "no
parking" signs are posted, (d) on ramps, (e) in cross hatched
areas, and (f) in such other areas as may be designated by Landlord
as reserved for the exclusive use of others. Washing, waxing,
cleaning or servicing of any vehicle by anyone is prohibited.
Tenant shall acquaint all persons to whom Tenant assigns parking
spaces for these Rules and Regulations.