Exhibit 10.7
Commercial Lease Agreement
THIS LEASE AGREEMENT, is made and entered into as of this 1st day of
September, 1999, by and between ▇▇▇▇▇▇ ▇▇▇▇▇▇ (Lessor) of ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ of NEVADA, and ▇▇▇▇▇▇ Enterprises Inc.
(Lessee) of ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ of Nevada.
The aforementioned shall hereinafter jointly be referred to as the PARTIES.
WITNESSETH:
ARTICLE 1
LEASED PREMISES
In consideration of the rents herein provided and the terms, provisions and
covenants hereof, Lessor hereby leases, lets and demises to Lessee the following
described premises (hereinafter referred to as the Leased Premises): ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
Approximately 7,616 square feet of gross rentable area, and more
particularly described in Exhibit B attached. Lessee hereby unequivocally
acknowledges by execution of this Lease Agreement that the aforementioned square
feet of gross rentable area may include Lessees pro rata share of common areas
shared by other tenants. In such event, Lessee may be actually occupying less
than 7,616 square feet; however, it shall not be construed that Lessee is in any
way relieved of paying rent pursuant to Article 3 herein.
EXHIBITS
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ARTICLE 2
TERM
SUBJECT TO AND UPON THE CONDITIONS SET FORTH HEREIN, AND IN ANY EXHIBIT OR
ADDENDUM HERETO, THE TERM OF THIS LEASE (HEREINAFTER REFERRED TO AS THE LEASE
TERM) SHALL COMMENCE ON SEPTEMBER 1, 1999 (HEREINAFTER REFERRED TO AS THE
COMMENCEMENT DATE), AND SHALL CONTINUE FOR 120 MONTHS UNTIL SEPTEMBER 1, 2009,
AT WHICH TIME THIS LEASE SHALL EXPIRE. IMMEDIATELY UPON SAID DATE OF TERMINATION
OF THIS LEASE, LESSEE SHALL VOLUNTARILY SURRENDER THE LEASED PREMISES TO LESSOR.
UPON COMPLETION OF THE INITIAL 120 MONTH LEASE, THE LESSEE HAS THE OPTION TO
NEGOTIATE A RENEWAL OF THE LEASE IN TWO FIVE YEAR INCREMENTS.
ARTICLE 3
RENT
Lessee agrees to pay in advance to Lessor during the Term hereof, without
deduction, setoff, prior notice, or demand, monthly rental (hereinafter referred
to as the Base Monthly Rental) for the Leased Premises in the amount of:
$5,000.00 dollars, which
amount shall be payable in advance on the first business day of each month of
the Lease Term. Payment of such rent shall be accompanied by all sales tax
levied by any federal, state, county, or city government or by any agency
authorized to levy and collect rent tax, and shall be payable in lawful money of
the United States of America to Lessor at the address of Lessor set forth below.
The amount of the monthly installments set forth above shall be subject to
escalation, and additional rent shall be due and payable from Lessee to Lessor,
as hereinafter provided. Other remedies for nonpayment of rent under this Lease
notwithstanding, if the rental payment is not received by Lessor on or before
ten (10) days after such rent is due, a service charge of five percent (5%) of
the rent then due shall become due and payable on demand in addition to the rent
owed under this Lease as remuneration for the additional expense for handling
late rentals.
ARTICLE 4
RENTAL ADJUSTMENT: CONSUMER PRICE INDEX
On the first day of the second lease year (which lease year shall commence
on the first anniversary of the Commencement Date if the Commencement Date is
the first day of a calendar month, or on the first day of the first calendar
month following the anniversary of the Commencement Date if the Commencement
Date is other than the first day of a calendar month), and on the first day of
each lease year (including renewals of this Lease Agreement, if any) thereafter
until this Lease is terminated as set forth herein, the Base Annual Rent shall
be adjusted and changed, on a cumulative basis, as follows:
The Base Annual Rent and the monthly rental installments payable for each
lease year during the Lease Term (other than the first lease year) shall be
computed by multiplying the Base Annual Rental (and the monthly rental
installment) as set forth in Article 3 above by a fraction, the numerator of
which shall be the Consumer Price Index (Urban, the United States city average
for urban wage earners, all items [Base 1982-84 = 100], issued by the Bureau of
Labor Statistics of the United States Department of Labor) for the second (2nd)
full month prior to the Commencement Date of this Lease; provided, however, that
in no event shall such increase in Annual Rent be less than five percent ( 5 %)
throughout the Lease Term.
In the event that the Consumer Price Index ceases to use the 1982-84
average of one hundred (100) as the basis of calculation, or if a change is made
in the terms of particular items contained in the Consumer Price Index, then the
Consumer Price Index shall, at the discretion of the Lessor, be adjusted to the
figure that would have been arrived at had the change in the manner of computing
the Consumer Price Index in effect at the commencement of the Lease Term not
been affected. In the event that such Consumer Price Index (or successor or
substitute Consumer Price Index) is not available, a reliable governmental or
other nonpartisan publication evaluating the purchasing power of money may be
used at the discretion of Lessor.
ARTICLE 5
SECURITY DEPOSIT
The Lessee agrees to pay a security deposit equal to five thousand
($5000.00) upon the beginning of the lease. Unless required under state law,
the security deposit will be released to the Lessor, who shall not be
required to maintain it in a separate account nor be charged interest thereon.
The security deposit shall be used by the lessor to pay for any damage
caused by the Lessee during his occupancy, reasonable wear and tear excepted. In
addition, the security deposit may also be used to offset monetary damage of
unpaid rent or unpaid late fees.
ARTICLE 6
QUIET ENJOYMENT
The Lessor covenants and agrees that Lessee, on paying said monthly rent
and performing all the covenants of this Lease on the part of Lessee to be
performed herein, shall and may peaceably and quietly hold and enjoy the said
Leased Premises.
ARTICLE 7
OPERATING EXPENSE ADJUSTMENTS
It is understood that the Annual Rent specified in Articles 3 and 4 is in
anticipation of Lessor incurring certain expenses for taxes, operations, and
maintenance costs. Therefore, the Lessor and Lessee agree to the definitions and
terms set forth below:
A. Real Estate Taxes: Lessor shall pay real estate taxes imposed on the
Leased Premises. Lessee shall reimburse Lessor for any increase in
real estate taxes imposed on the Leased Premises over and above the
amount of these taxes for the calendar year 1999. Said increase shall
be payable on or before thirty (30) days after receipt of notice of
the amount from Lessor. The term real estate taxes shall include all
ad valorem taxes and general and special assessments levied against
the Leased Premises. Lessee shall be responsible for all taxes levied
on Lessees personal property.
B. Utility Service: Lessor shall provide the standard utility service
connections for water, sewer, electricity, and telephone into the
Leased Premises. Lessee shall pay the cost of all utility services for
the Leased Premises, including but not limited to initial connection
charges and/or deposits, all charges for water, sewer, telephone, and
electricity, and all replacement of electric light lamps, tubes, and
ballasts used on or in connection with the Leased Premises. The
Lessees pro rata share of the entire building is one hundred percent
(100%). Failure by the Lessor to make available these services, or any
cessation thereof, resulting from causes beyond the control of the
Lessor, shall neither render Lessor liable in any respect for damages
to either person or property, nor relieve Lessee from fulfillment of
any covenant of this Lease. Should any of the equipment or machinery,
under the control of the Lessor, necessary to provide such services
break down, or for any cause cease to function properly, Lessor shall
use reasonable diligence to repair the same properly.
C. Repairs and Maintenance: The Lessor and Lessee shall maintain the
Building and the Leased Premises in good repair and condition
according to the following schedule:
Mechanical, Heating, Ventilation, and Air Conditioning: Lessor
shall be responsible for all major maintenance and repairs to the
mechanical, heating, air conditioning, and ventilation systems;
provided, however, that Lessee shall pay the first $ 300.00 per
occurrence (for items not protected by service warranties) for all
maintenance and repairs of such systems within the Leased Premises or
Lessees pro rata share of the total building if appropriate. Lessor
shall supply and change all air conditioning filters as required.
Lessee shall reimburse to Lessor the cost of supplying and changing
such filters within thirty (30) days of receiving ▇▇▇▇ from Lessor.
Plumbing and Electrical: Lessor shall be responsible for all
major repairs and maintenance of the plumbing and electrical systems;
provided, however, that Lessee shall pay the first $300.00 per
occurrence (for items not protected by service contracts or
warranties) for maintenance and repairs of such systems within the
Leased Premises or Lessees pro rata share of Building if the cost of
such repair and maintenance shall be billed to the Building as a
whole.
Interior Maintenance: Lessee shall clean, provide cleaning
supplies, and maintain the Leased Premises in a clean, sanitary, and
good condition. Lessee shall make all needed repairs, including but
not limited to interior pest control, and replacements to the interior
of the Leased Premises, except for those responsibilities expressly
imposed upon Lessor above. Lessee shall maintain and repair all
interior glass.
Common Area Maintenance Charges: Lessee shall pay its pro rata
share of the common area charges. Said charges are assessed by Lessor
to pay for maintenance, repairs, and replacements, as necessary, to
include, but not be limited to, the maintenance of common streets,
drives, street lighting, landscaping, swale and berm maintenance,
common area irrigation, fountains, walls, parking lot maintenance,
refuse service, building exteriors and roofs, et cetera. The Lessees
pro rata share of common area maintenance charges shall be computed by
multiplying the total common area maintenance charges by a fraction,
the numerator of which shall be the Lessees 7,616 square feet and the
denominator of which shall be 7,616 (the total number of square feet
of office buildings for which certificates of occupancy have been
issued in the building). Payment shall be made monthly by Lessee
within ten (10 ) days after Lessee receives notice from Lessor showing
the sum due, which notice shall state in reasonable detail the manner
in which Lessees share of common area maintenance is computed. Lessee
has the obligation to pay for any partial month at the commencement
and expiration or termination of the Lease Term.
D. Insurance: Lessor shall pay for fire and extended coverage insurance
for the Leased Premises. Lessee shall reimburse Lessor for any
increase in the cost of insurance that Lessor is responsible to carry
on the Leased Premises, over and above the insurance cost for the
calendar year 1999. Reimbursement shall be made by Lessee within ten
(10) days after Lessee receives notice from Lessor showing the sum
due, which notice shall state in reasonable detail the manner in which
Lessees share of insurance costs is computed. Lessee shall not be
obligated to reimburse Lessor for any portion of any increase in the
insurance premium caused by a particular use or activity of any other
tenant in the Building in which the Leased Premises is located.
Lessees obligation to pay the insurance costs shall be prorated for
any partial year at the commencement and expiration or termination of
the lease term. Lessee shall provide fire and extended coverage
insurance on its personal property and contents.
ARTICLE 8
ALTERATIONS AND IMPROVEMENTS
Lessee shall not make or allow to be made any alterations or physical
additions in or to the Leased Premises without first obtaining the written
consent of Lessor, which consent may be withheld at the sole discretion of
Lessor for any reason. Any and all such alterations, physical additions, or
improvements to the Leased Premises, when made by Lessee, shall at once become
the property of Lessor and shall be surrendered to Lessor upon the termination
of this Lease, by lapse of time or otherwise; provided, however, this clause
shall not apply to movable equipment, partitions, or furniture owned by Lessee,
which may be removed by Lessee at the end of the term of this Lease if Lessee is
not then in default and if such equipment, partitions, and furniture are not
then subject to any other rights, liens, and interests of Lessor hereunder. All
damages to the Leased Premises caused by or becoming evident by the removal of
such movable equipment, furniture, or partitions or otherwise shall be repaired
by Lessee at Lessees cost prior to surrender of the Leased Premises.
ARTICLE 9
LIENS
It is expressly covenanted and agreed by and between the Parties hereto
that nothing contained in this Lease shall authorize Lessee to do any act which
shall in any way encumber the title of Lessor in and to the Building or the land
upon which the Building is situated, nor shall the interest or estate of Lessor
in the Leased Premises be in any way subject to any claim by way of lien or
encumbrance, whether by operation of law or by virtue of any express or implied
contract by Lessee, and any claim to or lien upon the Leased Premises arising
from any act or omission of Lessee shall accrue only against the leasehold
estate of Lessee and shall in all respects be subject and subordinate to the
paramount title and right of Lessor in and to the Leased Premises. Lessee will
not permit the Leased Premises to become subject to any mechanics, laborers, or
materialmens lien on account of labor or material furnished to Lessee or any
sublessee in connection with work of any character performed or claimed to have
been performed on the Leased Premises by or at the direction or sufferance of
Lessee; provided, however, that Lessee shall have the right to contest in good
faith and with reasonable diligence the validity of any such lien or claimed
lien if Lessee shall give to Lessor such reasonable security as may be demanded
by Lessor to ensure payment to prevent any sale, foreclosure, or forfeiture of
the Leased Premises by reason of nonpayment thereof. On final determination of
the lien or claim for lien, Lessee will immediately pay any judgment rendered
with all proper costs and charges and will at its own expense have the lien
released and any judgment satisfied. In case Lessee shall fail to contest the
validity of any lien or claimed lien and give security to Lessor to ensure
payment thereof, or having commenced to contest the same, and having given such
security, shall fail to prosecute such contest with diligence, or shall fail to
have the same released and satisfy any judgment rendered thereon, then Lessor
may, at its election and without any requirement that it do so, remove or
discharge such lien or claim for lien (with the right in its discretion to
settle or compromise the same), and any amounts advanced by Lessor for
such purposes shall be so much additional rental due from Lessee to Lessor on
demand, with interest at the highest rate allowed by law from the date of
payment thereof by Lessor until the repayment thereof by Lessee to Lessor.
ARTICLE 10
FIRE AND CASUALTY
If the Leased Premises shall be injured or damaged by fire or other causes
and should Lessor elect to make repairs to the Leased Premises and complete said
repairs within one hundred and eighty (180) days of the damage, then this Lease
shall not be terminated. Should Lessor elect not to rebuild, it may terminate
this Lease by written notice to Lessee. In either event, Lessor shall give
Lessee written notice of its intention to rebuild or terminate this Lease within
thirty (30) days after the event that causes said injury or damage. In no event
shall Lessor be liable to Lessee in any respect whatsoever for Lessees inability
to operate its business as a result of any casualty, including but not limited
to injury or damage to the Leased Premises caused by fire or other causes.
Lessee shall carry a work/rental interruption insurance policy covering
risk of loss due to casualty in an amount not less than the aggregate amount to
be paid by Lessee to Lessor or to a third party under the terms and provisions
of this Lease, including but not limited to rent, real property taxes, and
common area maintenance charges, for a period of six (6) months following any
occurrence of the said casualty.
ARTICLE 11
LIABILITY INSURANCE
Lessee agrees to carry at its own expense a Lessor/Lessees Liability
Insurance policy from a company satisfactory to Lessor, with minimum limits for
general public liability insurance for personal injury including death in the
amount of three hundred thousand dollars ($300,000.00) and five hundred
thousand dollars ($500,000.00) for each occurrence, with one million dollars
($100,000,000.00) umbrella coverage, and for property damage insurance a single
limit of not less than one hundred thousand dollars ($100,000.00) for each
occurrence; such insurance shall be for the joint benefit of Lessor and Lessee
and shall name Lessor as an additional insured.
Irrespective of the adequacy of said insurance, Lessee shall indemnify and
save Lessor free and harmless from any and all claims, actions, damages,
expenses (including without limitation reasonable attorneys fees), and liability
whatsoever arising out of or in any way connected with injury (including death)
or property damage to any person, firm, corporation, or other entity, including
Lessor, arising directly or indirectly from being on the Leased Premises or the
use or occupancy of said Leased Premises.
Copies of all the Lessees required insurance policies shall be delivered to
Lessor prior to occupancy of the Leased Premises. On an annual basis, the Lessee
shall provide Lessor with a Certificate of Insurance reflecting the types of
policies held, their amounts, and the Lessors interest as loss payee. Lessee
agrees that every insurer shall agree by endorsement upon the policy(ies) issued
by it, that it will give Lessor thirty ( 30 ) days written notice at the address
where rental is paid before the policy(ies) is question shall be altered or
canceled.
ARTICLE 12
WAIVER OF SUBROGATION
Anything in this Lease to the contrary notwithstanding, the Lessee hereby
waives any and all rights of recovery, claim, action, or cause of action against
Lessor, his agents, offices, and employees, for any loss or damage that may
occur to the Leased Premises hereby demised, or any improvements thereto, or
personal property located therein, or said Building of which the Leased Premises
are part, or any other cause which could be insured against under the terms of
standard fire and extended coverage insurance policies, regardless of cause or
origin, including negligence of the Parties hereto, their agents, officers, and
employees. Lessee agrees to make best efforts to have its insurance company
waive its subrogation rights under all policies.
ARTICLE 13
CONDEMNATION
Lessee agrees that if the said Leased Premises, or any part thereof, shall
be taken or condemned for public or quasi-public use or purpose by any
authority, Lessee shall have no claim against the Lessor and shall not have any
claim or right to any portion of the amount that may be awarded to the Lessee as
damages or paid as a result of such condemnation; all the rights of the Lessee
to damages thereof, if any, are hereby assigned by the Lessee to the Lessor. If
the condemnation or taking is for the entire Leased Premises, the term of the
Lease shall cease and terminate from the date of such governmental taking or
condemnation, and the Lessee shall have no claim against the Lessor for the
value of any unexpired term of this Lease. Should the taking or condemnation be
for a part of the Leased Premises, then at the sole option of the Lessor, this
Lease shall not cease and terminate, but continue in full force and effect.
ARTICLE 14
USAGE OF LEASED PREMISES
The Leased Premises are to be occupied and used by the Lessee for office(s)
and for warehousing of a picture framing and product development facility. Use
for any other purpose shall constitute a breach of this Lease. Lessee shall not
occupy or use, or permit any portion of the Leased Premises to be occupied or
used, for any business or purpose which is unlawful, disreputable, or deemed by
Lessor to be extrahazardous, or permit anything to be done which in any way will
increase the rate of insurance coverage on said Leased Premises, and in the
event that, by reason of such acts of Lessee, there shall be any increase in the
insurance rates for the building or contents above normal rates, Lessee agrees
to pay to Lessor upon receipt of notice, as additional rental, an amount equal
to all such increase. Lessee shall conduct its business and control its agents,
employees, invitees, and visitors in such a manner as not to create any
nuisance, or interfere with, annoy, or disturb any other Lessee, Lessor, or any
other party involved in the management of the Building.
ARTICLE 15
COMPLIANCE WITH LAWS, REGULATIONS, AND RESTRICTIONS
Lessee shall comply with all laws, ordinances, orders, rules, and
regulations (state, federal, municipal and other agencies, or bodies having any
jurisdiction thereof) relating to the use, condition, or occupancy of the Leased
Premises. Lessee shall indemnify and save and hold Lessor harmless from Lessees
violation of any laws and ordinances. Lessee shall comply with all Building
Rules and Regulations of the Building as shown in Exhibit N/A.
ARTICLE 16
LESSORS RIGHT OF ENTRY
Lessee shall permit Lessor or its agents or representatives to enter into
and upon any part of the Leased Premises, at all reasonable hours, to inspect
the same, to clean or make repairs, alterations, or additions thereto, as Lessor
in its opinion may deem necessary or desirable, or for the purpose of
determining Lessees use thereof or whether an act of default under this Lease
has occurred.
ARTICLE 17
PARKING
Lessor shall provide nonexclusive parking for the benefit of Lessee, its
employees, customers, and visitors and for the benefit of other owners and
tenants, in the areas shown on the Site Plan attached hereto as Exhibit A .
Lessor has provided and Lessee exclusively designated for certain owners and
Lessees. Nineteen (19) exclusive parking spaces per One Thousand (1,000) square
feet of leasable area (within the Leased Premises) throughout the term of this
lease.
ARTICLE 18
SIGNS AND ADVERTISING
The Lessee shall have sign space on the following signs (see Exhibit B,
Sign Site Plan, for location of signs):
A. Building (Lessee) Identification Sign located near the Building.
B. Sign at the entrance to the Leased Premises.
All of the signs are to be in conformity with the building Sign Regulations
(see Exhibit C) and the county of ▇▇▇▇▇ Sign Regulations. No other advertising
or signs shall be placed by Lessee so as to be visible from the exterior of the
Leased Premises without the prior consent and design approval of the Lessor. Any
such signs and advertising shall be placed where designated by the Lessor and
installed by Lessor at Lessees expense. The cost of constructing and placing any
exterior sign or signs shall be at Lessees expense.
ARTICLE 19
ASSIGNMENT OR SUBLEASE
The Lessee covenants and agrees not to encumber or assign this Lease or
sublet all or any part (including desk space or mailing privileges) of the
Leased Premises without the written consent of the Lessor, which consent may be
withheld by Lessor. Such assignment shall in no way relieve the Lessee from any
obligations, covenants, and provisions of this Lease. If Lessor grants its
consent to an assignment or subletting, rent under this Lease shall thereafter
be the greater of (a) the rent payable as per terms and
conditions of this Lease, or (b) the rent payable by the Assignee or Subtenant
(including any consideration paid by Assignee or Subtenant).
In no event shall Lessee assign or sublet the Leased Premises for any
terms, conditions, and covenants other than those contained herein. In no event
shall this Lease be assigned or be assignable by operation of Law or by
voluntary or involuntary bankruptcy proceedings or otherwise, and in no event
shall this lease or any rights or privileges hereunder be an asset of Lessee
under any bankruptcy, insolvency, or reorganizational proceedings. Lessor shall
not be liable nor shall the Leased Premises be subject to any mechanics,
materialmens, or other type liens, and Lessee shall keep the Leased Premises and
land on which the Leased Premises are situated free from any such liens which
may occur because of acts of Lessee, notwithstanding any foregoing provision.
Any consent to any subletting or assignment shall not be deemed a consent
to any subsequent subletting or assignment. Any assignee, transferee, or
purchaser shall agree in writing to be bound by and comply with the provisions
of this Lease.
ARTICLE 20
not applicable
ARTICLE 21
TRANSFER BY LESSOR
If the interest of Lessor under this Lease shall be transferred, whether
voluntarily or by reason of foreclosure, voluntary sale, or other proceedings
for enforcement of any mortgage on the Leased Premises, Lessee shall be bound to
such transferee (herein sometimes called the Purchaser) under the terms,
covenants, and conditions of this Lease for the balance of the term hereof
remaining and any extensions or renewal hereof which may be effected in
accordance with the terms and provisions hereof, with the same force and effect
as if the Purchaser were the Lessor under this Lease, and Lessee does hereby
agree to attorn to the Purchaser, including the mortgagee under any such
mortgage, if it be the Purchaser, as its Lessor, said attornment to be effective
and self-operative without the execution of any further instruments upon the
Purchaser succeeding to the interest of the Lessor under this Lease. The
respective rights and obligations of Lessee and the Purchaser upon such
attornment, to the extent of the then remaining balance of the term of this
Lease and any such extensions and renewals, shall be and are the same as those
set forth herein.
ARTICLE 22
DEFAULT BY LESSEE
It shall be an event of default and shall be considered a breach of this
Lease by Lessee if one or any of the following shall occur:
A. Lessee shall make default in the payment of rent or other payment when
due as herein provided; and such default shall continue for a period
of ten (10) days or more; or default shall be made in any of the
other covenants, agreements,
conditions, or undertakings herein required to be kept, observed, and
performed by Lessee, and such other default shall continue for ten
(10) days after notice thereof in writing to Lessee; or,
B. Lessee shall file a petition in voluntary or reorganization bankruptcy
or under applicable Chapters of the Federal Bankruptcy Act or similar
law, state or federal, whether now or hereafter existing, or an answer
admitting insolvency or inability to pay its debts, or fail to obtain
a vacation or stay of involuntary bankruptcy proceedings within sixty
(60) days as hereinafter provided; or,
C. Lessee shall be adjudicated a bankrupt, or a trustee or receiver shall
be appointed for all of its property or the major part thereof in any
involuntary proceedings, or any court shall have taken jurisdiction of
the property of Lessee or the major part thereof in any involuntary
proceedings for the reorganization, dissolution, liquidation, or
winding up of Lessee, and such jurisdiction is not relinquished or
vacated or stayed on appeal or otherwise within sixty (60) days; or,
D. Lessee shall make an assignment for the benefit of its creditors, or
shall vacate or abandon the Leased Premises.
ARTICLE 23
REMEDIES UPON DEFAULT
If any one or more of the events of default set forth in Article 22 occurs,
then Lessor may, at its election:
Give Lessee written notice of its intention to terminate this Lease on
the date of such notice or on any later date specified in such notice,
and, on the date specified in such notice, Lessees right to possession
of the Leased Premises will cease and the Lease will be terminated
(except as to Lessees liability set forth in this Article 23), as if
the date fixed in such notice were the end of the term of this Lease.
If this Lease is terminated pursuant to the provisions of this
Article, Lessee will remain liable to Lessor for damages in an amount
equal to the rent and other sums which would have been owing by Lessee
under this Lease for the balance of the term if this Lease had not
been terminated, less the net proceeds, if any, of any reletting of
the premises by the Lessor subsequent to such termination, and after
deduction of all Lessors expenses set forth in the Lease. Lessor will
be entitled to collect such damages from Lessee monthly on the days on
which the rent and other amounts would have been payable under this
Lease if this Lease had not been terminated, and Lessor will be
entitled to receive such damages from Lessee on each such day.
Alternatively, at the option of the Lessor, if this Lease is
terminated, Lessor will be entitled to recover from Lessee.
i. The worth at the time of award of the amount by which the unpaid rent
that would have been earned after termination until the time of award
exceeds the amount of such rent loss that Lessee proves could
reasonably have been avoided;
ii. The worth at the time of award of the amount by which the unpaid rent
for the balance of the term of this Lease after the time of award
exceeds the
amount of such rent loss that Lessee proves could reasonably be
avoided; and
iii. Any other amount necessary to compensate Lessor for all the detriment
proximately caused by Lessees failure to perform its obligations under
this Lease or which in the ordinary course of things would be likely
to result from such failure. The worth at the time of award of the
amount referred to in clauses (i) and (ii) is computed by allowing
interest at the highest rate permitted by law. The worth at the time
of award of the amount referred to in clause (iii) is computed by
discounting such amount at the discount rate of the Federal Reserve
Bank of Atlanta at the time of award,
iv. If Lessor elects to take possession of the premises according to this
Lease paragraph without terminating this Lease, Lessee will pay Lessor
the rent and other sums which would be payable under this Lease as if
such repossession had not occurred, less the net proceeds, if any, of
the reletting of the premises after deducting all of Lessors expenses
incurred in connection with such reletting, including, without
limitation, all repossession costs, brokerage commissions, legal
expenses, attorneys fees, expenses of employees, alterations,
remodeling and repair costs, and expenses of preparation for such
reletting. If, in connection with any reletting, the new Lease term
extends beyond the existing term, or the premises covered by such
reletting include areas which are not part of the premises, a fair
apportionment of the rent received from such reletting and the
expenses incurred in connection with such reletting will be made in
determining the net proceeds received from such reletting. In
addition, in determining the net proceeds from such reletting, any
rent concessions will be apportioned over the term of the new Lease.
Lessee will pay such amounts to Lessor monthly on the days on which
the rent and all other amounts owing under this Lease would have been
payable if possession had not been retaken, and Lessor will be
entitled to receive the rent and other amounts from Lessee on each
such day.
ARTICLE 24
WAIVER OF BREACH
Failure of Lessor to declare any default immediately upon occurrence
thereof, or delay in taking any action in connection therewith, shall not waive
such default, but Lessor shall have the right to declare any such default at any
time and take such action as might be lawful or authorized hereunder, either in
law or in equity.
ARTICLE 25
ABANDONMENT
In the event the Lease Premises are abandoned by Lessee, Lessor shall have
the right, but not the obligation, to relet the same for the remainder of the
term provided for herein and if the rent received through such reletting does
not at least equal the rent provided for herein, Lessee shall pay and satisfy
any deficiency between the amount of the rent so provided for and that received
through reletting, and, in addition thereto, shall pay all
expenses incurred in connection with any such reletting, including, but not
limited to, the cost of renovation, altering, and decorating for a new occupant.
Nothing herein shall be construed as in any way denying Lessor the right in the
event of abandonment of said Leased Premises or other breach of this Agreement
by Lessee to treat the same as an entire breach and, at Lessors option, to
immediately ▇▇▇ for the entire breach of this Agreement and any and all damages
that Lessor suffers thereby.
ARTICLE 26
HOLDING OVER
IN THE EVENT OF HOLDING OVER BY LESSEE AFTER THE EXPIRATION OR TERMINATION OF
THIS LEASE, SUCH HOLDOVER SHALL BE AS A TENANT AT WILL, AND ALL OF THE TERMS AND
PROVISIONS OF THIS LEASE SHALL BE APPLICABLE DURING SUCH PERIOD, EXCEPT THAT
LESSEE SHALL PAY LESSOR AS RENTAL FOR THE PERIOD OF SUCH HOLDOVER AN AMOUNT
EQUAL TO ONE HUNDRED AND TWENTY FIVE PERCENT (125%) OF THE RENT WHICH WOULD HAVE
BEEN PAYABLE BY LESSEE HAD SUCH HOLDOVER PERIOD BEEN A PART OF THE ORIGINAL TERM
OF THIS LEASE, AND LESSEE WILL VACATE THE LEASED PREMISES AND DELIVER THE SAME
TO LESSOR UPON LESSEES RECEIPT OF NOTICE FROM LESSOR TO VACATE SAID PREMISES.
THE RENTAL PAYABLE DURING SUCH HOLDOVER PERIOD SHALL BE PAYABLE TO LESSOR ON
DEMAND. NO HOLDING OVER BY LESSEE SHALL OPERATE TO EXTEND THIS LEASE EXCEPT AS
HEREIN PROVIDED. LESSEE AGREES TO PAY LESSORS COSTS AND REASONABLE ATTORNEYS
FEES SHOULD LESSOR EXPEND MONIES FOR THE REMOVAL OF LESSEE OR ANY OF LESSEES
PROPERTY.
ARTICLE 27
ATTORNEYS FEES
In the event Lessee makes default in the performance of any of the terms,
covenants, agreements, or conditions contained in this Lease and Lessor places
the enforcement of this Lease, or any part thereof, or the collection of any
rent due or to become due hereunder, or recovery of the possession of the Leased
Premises, in the hands of an attorney, or files suit upon the same, Lessee
agrees to pay Lessors costs and reasonable attorneys fees for the services of
such attorneys. The obligation of Lessee to pay such costs of collections
including reasonable attorneys fees shall apply whether or not suit be brought,
and if suit be brought, then at both trial and appellate levels.
ARTICLE 28
HOLD HARMLESS
Lessee agrees to defend, indemnify, and hold Lessor harmless against any
and all claims, damages, accidents, and injuries to persons or property caused
by or resulting from or in connection with anything in or pertaining to or upon
the Leased Premises.
AS A MATERIAL PART OF THE CONSIDERATION TO BE RENDERED TO LESSOR UNDER THIS
LEASE, LESSOR SHALL NOT BE LIABLE FOR DAMAGE TO PROPERTY OF LESSEE OR OF OTHERS
LOCATED ON THE LEASED PREMISES OR BUILDING, NOR FOR THE LOSS OF OR DAMAGE TO ANY
PROPERTY OF LESSEE OR OF OTHERS BY THEFT, CASUALTY LOSS, OR OTHERWISE, NOR SHALL
LESSOR BE LIABLE TO LESSEE FOR LOSSES ARISING FROM THE INABILITY OF LESSEE TO
OPERATE ITS BUSINESS FOR ANY REASON WHATSOEVER, AND LESSEE HEREBY WAIVES ALL
SUCH CLAIMS AGAINST LESSOR AND WILL HOLD LESSOR EXEMPT AND HARMLESS FOR OR ON
ACCOUNT OF SUCH DAMAGE OR INJURY.
LESSOR SHALL NOT BE LIABLE FOR ANY INJURY OR DAMAGE TO PERSONS OR PROPERTY
RESULTING FROM (BUT NOT LIMITED TO) FIRE OR EXPLOSION ON ANY PART OF THE LEASED
PREMISES OR BUILDING OR FROM THE PIPES, APPLIANCES, OR PLUMBING WORKS OR FROM
THE ROOF, STREET, OR SUBSURFACE OR FROM ANY PLACE OR BY DAMPNESS OR ANY OTHER
CAUSE OF WHATSOEVER NATURE. LESSOR SHALL NOT BE LIABLE FOR ANY SUCH DAMAGE
CAUSED BY OTHER TENANTS OR PERSONS IN THE BUILDING, OCCUPANTS OF ADJACENT
PROPERTY, OR THE PUBLIC, OR CAUSED BY OPERATIONS IN CONSTRUCTION OF ANY PRIVATE,
PUBLIC, OR QUASI-PUBLIC WORK. ALL PROPERTY OF THE LESSEE KEPT OR STORED ON THE
LEASED PREMISES SHALL BE SO KEPT OR STORED AT THE RISK OF LESSEE, AND LESSEE
SHALL HOLD LESSOR HARMLESS FROM ANY CLAIMS ARISING OUT OF DAMAGE TO THE SAME,
INCLUDING SUBROGATION CLAIMS BY LESSEES INSURANCE CARRIERS.
ARTICLE 29
LESSORS LIABILITY
The term Lessor as used in this Lease means only the owner from time to
time of the Leased Premises. Lessor shall be under no personal liability with
respect to any of the provisions of this Lease, and if Lessor is in default with
respect to its obligations hereunder, Lessee shall look solely to the equity of
the Lessor in the Leased Premises and Building for the satisfaction of the
Lessees remedies. It is expressly understood and agreed that the Lessors
liability under this Lease shall in no event exceed the loss of its equity
interest in the Leased Premises.
ARTICLE 30
FORCE MAJEURE
Lessor shall be excused for the period of any delay in the performance of
any obligation when the delay is a result of any cause or causes beyond its
control, which includes but is not limited to all labor disputes, governmental
regulations or control, fire or other casualty, or inability to obtain any
material, services, or financing.
ARTICLE 31
NOTICE
All rent and other payments required to be made by Lessee to Lessor
hereunder shall be payable to Lessor at the address set forth below, or such
other address as Lessor may specify from time to time, by written notice
delivered in accordance herewith. Unless otherwise provided to the contrary
herein, any notice or document required or permitted to be delivered hereunder
shall be deemed to be delivered (whether or not actually received) when
deposited in the United States mail, postage prepaid, Certified Mail, Return
Receipt Requested, addressed to the Parties hereto at the respective addresses
set out opposite their names below, or at such other address as they have
theretofore specified by written notice delivered in accordance herewith:
LESSOR
▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇, ▇▇▇▇▇
Lessee:
▇▇▇▇▇▇ ENTERPRISES INC.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇, ▇▇▇▇▇
ARTICLE 32
Estoppel Certificates
Upon ten (10) days prior written notice from Lessor, Lessee shall execute
and deliver to Lessor a statement in writing (1) certifying that this Lease is
unmodified and in full force and effect, and dates to which the rent and other
charges are paid in advance, if any, and (2) acknowledging that to Lessees
knowledge there are not any uncured defaults on the part of Lessor hereunder and
that Lessee has no right of offset, counterclaim, or deduction in rent or
specifying such defaults, if any, or claim, together with the amount of any
offset, counterclaim, or deduction alleged by Lessee. Any such statement may be
relied upon by any prospective purchaser or lender upon the security of the real
property of which the Leased Premises are a part. Lessees failure to deliver
said statement within such time shall constitute agreement by Lessee (1) that
this Lease is in full force and effect without modification except as may be
represented by Lessor, (2) that there are no uncured defaults in Lessors
performance and that Lessee has no right of offset, counterclaim, or deduction
against rent, and (3) that no more than one months rent has been paid in
advance.
ARTICLE 33
LIENS FOR RENTS
not applicable
ARTICLE 34
SECURITY AGREEMENT
not applicable
ARTICLE 35
COMMON AREA USAGE
Should Lessee purchase or lease security, telephone, communications,
electronic, or any other kind of equipment, then said equipment shall not be
installed, placed, or stored in any common areas of the Park or Building. Should
Lessee place any such equipment or any kind of personal property in said common
areas, then Lessor, at his election, may remove said personal property at
Lessees expense.
ARTICLE 36
FLOOR LOADS
Lessee shall not place a load upon the floor of the Leased Premises which
exceeds the floor load per square foot which such floor was designed to carry.
Floor load is stipulated to be 70 pounds per square foot. Lessor and Lessee will
determine jointly the approximate weight and the position of all safes and heavy
installations which the Lessee wishes to place in the Leased Premises so as to
distribute properly the weight thereof.
Business machines and mechanical equipment belonging to Lessee which cause
noise and/or vibration that may be transmitted to the structure of the Building
or to any leased space to such a degree as to be objectionable to Lessor or to
any tenants in the Building shall be placed and maintained by the party owning
the machines or equipment, at such partys expense, in a setting of cork, rubber,
or springs-type noise and/or vibration eliminators sufficient to eliminate
vibration and/or noise.
ARTICLE 37
GENERAL
A. This Lease shall be binding and inure to the benefit of the Parties
hereto and their respective heirs, personal representatives,
successors, and assigns.
B. This Lease shall create the relationship of Lessor and Lessee. No
estate shall pass out of the Lessor, and the Lessee shall have only a
right of use which shall not be subject to levy and sale.
C. The submission of this instrument for examination or signature by the
Lessee does not constitute a reservation of or an option for lease,
and it is not effective as a lease or otherwise until execution and
delivery by both Lessor and Lessee.
▇. ▇▇▇▇▇▇ shall have the right to transfer and assign, in whole or in
part, all of its rights and obligations hereunder in the Building
and/or Leased Premises referred to herein.
E. The captions or headings of the various Articles in this Lease
Agreement are for convenience only, and are not to be construed as
part of this Lease, and shall not be construed as defining or limiting
in any way the scope or intent of the provisions hereof.
F. Time is of the essence of this Lease Agreement.
G. Any pronouns used in the Lease shall be deemed to include the
masculine, feminine, neuter, singular, and plural as appropriate.
H. This instrument embodies the whole agreement between the Parties, and
there are no promises, terms, conditions, or obligations other than
those herein contained. This agreement shall supersede all previous
communications, representations, proposals, or agreements, either
verbal or written, between the parties hereto and not herein
contained. This agreement shall not be modified or canceled unless
reduced in writing and signed by both parties, properly witnessed, and
by direct reference therein made a part hereof.
I. If any term, covenant, condition, or provision of the Lease or the
application thereof to any person or circumstance shall, at any time
or to any extent, be invalid or unenforceable, the remainder of this
Lease shall not be affected thereby, and each term, covenant,
condition, and provision of this Lease shall be valid and be enforced
to the fullest extent of the law. This Lease and the
performance thereof shall be governed, interpreted, construed, and
regulated by the laws of the state of Nevada, and the venue of any
action shall lie in ▇▇▇▇▇ County, Nevada.
J. The Parties hereto further understand and agree that this Lease shall
not be recorded in any Public Records of ▇▇▇▇▇ County, Nevada , except
at the option of the Lessor. The Parties also agree, at the option of
the Lessor, to execute a short-form lease for recording, containing
the names of the parties and such other terms and conditions of the
Lease as may be requested by the Lessor.
K. TO THE EXTENT PERMITTED BY APPLICABLE LAW, LESSOR AND LESSEE HEREBY
WAIVE TRIAL BY JURY IN ANY ACTION, PROCEEDING, OR COUNTERCLAIM BROUGHT
BY EITHER AGAINST THE OTHER ON ANY MATTER WHATSOEVER ARISING OUT OF OR
IN ANY WAY CONNECTED WITH THIS LEASE, THE RELATIONSHIP OF LESSOR AND
LESSEE, OR LESSEES USE OR OCCUPANCY OF THE LEASED PREMISES, OR ANY
EMERGENCY OR OTHER STATUTORY REMEDY WITH RESPECT HERETO.
ARTICLE 39
SIGNATURE PAGE
IN WITNESS WHEREOF, the Parties hereto have executed this Lease Agreement
on the day and year first above written. Signed, sealed, and delivered in the
presence of:
-------------------------------
Lessor
By
------------------------------- -------------------------------
Witness Authorized Representative
-------------------------------
Witness
------------------------------- -------------------------------
Witness Lessee
By
------------------------------- -------------------------------
Witness Authorized Representative
Exhibit A Sign Site Plan
Exhibit B Site Plan
BUILDING RULES AND REGULATIONS
The following Rules and Regulations have been adopted by the owners for the
care and protection of the building located in 6430 Sunset Corporate Drive, and
for the general comfort and welfare of all occupants.
1. Wherever Tenant is obligated under these Rules and Regulations to do
or refrain from doing an act or thing, such obligation shall include
the exercise by Tenant
of its best efforts to secure compliance with such obligation by the
servants, employees, contractors, jobbers, agents, invitees,
licensees, guests, sublessees, and visitors of Lessee. The term
Building shall include the structure within which the Leased Premises
is located, and any obligations of Tenant hereunder with regard to the
Building shall apply with equal force to the Leased Premises and to
other parts of the Building.
2. Tenant shall not obstruct or interfere with the rights of other
occupants in the Building, or of persons having business in the
Building in which the Leased Premises are located, or in any way
injure or annoy such persons.
3. Tenant shall not use the Leased Premises or the Building for lodging,
sleeping, cooking, or any immoral or illegal purposes, or for any
purpose that will damage the building, or the reputation thereof, or
for any purpose other than those specified in the Lease.
4. Canvassing, soliciting, and peddling in the Building are prohibited,
and Tenant shall cooperate to prevent such activities.
5. Tenant shall not bring or keep within the Building any animal or
motorcycle.
6. Tenant shall not conduct mechanical or manufacturing operations, ▇▇▇▇
or prepare food, or place in use any inflammable, combustible,
explosive, or hazardous fluid, chemical device, substance, or material
in or about the Leased Premises or the Building without the prior
written consent of Landlord. Tenant shall comply with all rules,
orders, regulations, and requirements of the applicable Fire Rating
Bureau, or any other similar body, and Tenant shall not commit any act
or permit any object to be brought or kept in Leased Premises or the
Building which shall increase the rate of fire insurance on the
Building or on property located therein.
7. Not applicable
8. Tenant shall not install or use in the Leased Premises or Building any
engine, boiler, generator, heating unit, air conditioning unit (other
than the air conditioning and heating unit Landlord provides), stove,
water cooler, ventilator, radiator, or any other similar apparatus
without the prior written consent of Landlord.
9. Not applicable
10. Not applicable
11. Not applicable
12. Not applicable
13. Tenant shall not deposit any trash, refuge, cigarettes, or other
substances of any kind within or out of the Building except in the
refuse containers provided therefor. Tenant shall not introduce into
the Building any substance which might add an undue burden to the
cleaning or maintenance of the Leased Premises or the Building. Tenant
shall exercise its best efforts to keep the sidewalks, entrances,
passages, courts, lobby areas, parking areas, stairways, vestibules,
public corridors, and halls in and about the Building (hereinafter
referred to as Common Areas) clean and free from rubbish.
14. Tenant shall use the Common Areas only as a means of ingress and
egress, and Tenant shall permit no loitering by any persons upon
Common Areas. Common
Areas and the roof of the Building are not for the use of the general
public, and Landlord shall in all cases retain the right to control or
prevent access thereto by all persons whose presence, in the judgment
of Landlord, shall be detrimental to the Building and/or its tenants.
Tenant shall not enter the mechanical room, air conditioning rooms,
electrical closets, janitorial closets, or similar areas or go upon
the roof of the Building without the prior written consent of
Landlord, unless such areas shall have been designated as part of the
Leased Premises.
15. Tenant shall not use the washrooms, rest rooms, and plumbing fixtures
of the Building, if any, and appurtenances thereto, for any purpose
other than the purposes for which they were constructed, and Tenants
shall not deposit any sweepings, rubbish, rags, or other improper
substances therein. Tenant shall not waste water by interfering or
tampering with the faucets or otherwise. If Tenant or Tenants
servants, employees, agents, contractors, jobbers, licensees,
invitees, guests, or visitors cause any damage to such washrooms, rest
rooms, plumbing fixtures, or appurtenances, such damage shall be
repaired at Tenants expense and Landlord shall not be responsible
therefor.
16. Tenant shall not ▇▇▇▇, paint, drill into, cut, string wires, or in any
way deface any part of the Building without the prior written consent
of Landlord. Upon removal of any wall decorations or installations of
floor coverings by Tenant, any damage to the walls or floors shall be
repaired by Tenant at Tenants sole cost and expense. Tenant shall
refer all contractors, representatives, installations technicians, and
other mechanics, artisans, and laborers rendering any service in
connection with the repair, maintenance, or improvement of the Leased
Premises to Landlord for Landlords supervision, approval, and control
before performance of any such service. This Paragraph 16 shall apply
to all work performed in the building, including, without limitation,
installation of the telephones, telegraph equipment, electrical
devices, and attachments and installations of any nature affecting
floor, walls, woodwork, trim, windows, ceilings, equipment, or any
structural portion of the Building. Plans and specifications for such
work, prepared at Tenants sole expense, shall be submitted to Landlord
for its prior written approval in each instance before commencement of
work. All installations, alterations, and additions shall be
constructed by Tenant in a good and workmanlike manner, and only good
grades of material shall be used in connection therewith. The means by
which telephone, telegraph, and similar wires are to be introduced to
the Leased Premises and the location of telephones, call boxes, and
other office equipment affixed to the Leased Premises shall be subject
to the prior written approval of Landlord.
17. Tenant shall not obstruct, alter, or in any way impair the efficient
operation of the Leased Premises heating, ventilating, air
conditioning, electrical, fire, safety, or lighting systems.
18. Not applicable
19. Employees of the Landlord or the Building Association (Association)
shall not receive or carry messages for or to Tenant or any other
person, nor contact with nor render free or paid services to Tenant or
Tenants servants, employees, contractors, jobbers, agents, invitees,
licensees, guests, or visitors. In the event
that any of Landlords or Associations employees perform any such
services, such employees shall be deemed to be the agents of Tenant
regardless of whether or how payment is arranged for such services,
and Tenant hereby indemnifies and holds Landlord or Association
harmless from any and all liability in connection with any such
services and any associated injury or damage to property or injury or
death to personal resulting therefrom.
20. No radio or television aerial or other similar device shall be
installed without first obtaining Landlords consent in writing on each
separate instance. No aerial shall be erected on the roof or exterior
walls of the Building, or on the grounds, without in each instance the
written consent of Landlord. Any aerial so installed without such
written consent shall be subject to removal without notice at any
time.
ACKNOWLEDGMENT OF RECEIPT
The undersigned hereby acknowledges receipt of a complete copy of the
foregoing Rules and Regulations.
BY
---------------------------------------
Authorized Representative for