EXHIBIT 10.2(b)
DERMODY
PROPERTIES
STANDARD INDUSTRIAL LEASE FOR LANDLORD USE ONLY:
(NET-NET-NET) BUILDING #: 640B
L/A: EGZ
Lease Preparation Date: March 23, 2000
Landlord: Dermody Industrial Group, a Nevada joint venture, located at 1200
Financial Boulevard. P. O. Box 7098, Reno, Nevada 89510
Tenant: UPS, a Nevada corporation
Trade Name (dba): UDS
1. LEASE TERMS
1.01 Premises: The Premises referred to in this Lease contain
approximately 52,500 square feet as shown on Exhibit "A" attached. The address
of the Leased Premises is: 4910 Longley Lane, Suite 102, Reno, Nevada.
1.02 Project: The Project in which the Premises are located consist
of approximately 333,000 square feet as shown in Exhibit A.
1.03 Tenant's Notice Address: Tenant's Notice Address is the
address of the Leased Premises as defined in Section 1.01 unless otherwise
specified here:
1.04 Landlord's Notice Address: P. O. Box 7098, Reno, Nevada 89510
1.05 Tenant's Permitted Use: Warehousing, assembling, and
distribution of consumer products and related activities in full compliance with
the terms of this Lease.
1.06 Lease Term: The Lease Term is for 7 years and commences on
October 1, 2000 (the "Lease Commencement Date") and expires September 30, 2007.
Tenant shall also be entitled to the options to extend the Lease Term for two
(2) additional five (5) year periods (the "Extension Terms" as defined in
Section 41.01 below), subject to and in compliance with the terms and conditions
specified in Article 41. below. For purposes of this Lease, the terms, "Lease
Term," "term of the Lease," and "term," shall mean and include the initial
period of the Lease specified above, together with the Extension Term(s) to the
extent the Extension Option(s) are exercised by Tenant pursuant to Article 41,
below, and the term, "Initial Lease Term," shall mean the initial period of the
Lease as specified above.
1.07 Base Monthly Rent shall be paid in lawful money of the United
States of America on the following schedule:
2000 Months 1-3: Free of Base Monthly Rent (Additional Rent
is still required)
Months 4-30: 27(cents) a square foot per month
n/n/n $14,175.00
Months 31-60: 28(cents) a square foot per month
n/n/n $14,700.00
Months 61-84: 30 (cents) a square foot per month
n/n/n $15,750.00
Adjustments to the Base Monthly Rent shall be made
NONE.
1.08 Security Deposit: SEVENTEEN THOUSAND, SIXTY-THREE AND 00/100
DOLLARS ($17,063.00) in lawful money of the United States of America.
1.09 Proportionate Share: Tenant's Proportionate Share is 15.77%
based upon the total square footage of the Project and the square footage of the
Premises.
1.10 Index: The Index for calculating cost of living adjustments in
the Base Monthly Rent during the Extension Term(s) shall be the Consumer Price
Index for All Urban Consumers, U. S. City Average (1982/84=100).
1.11 Tenant is entitled to COMMON vehicle parking spaces subject to
the provisions of Section 8 of the Lease.
1.12 Tenant Improvements: Tenant Improvements to be performed in
the Premises, if any, will be performed in accordance with the terms and
provisions entitled "Landlord's Work" contained in Exhibit "B" attached if
applicable. Thereafter during the Lease Term, Landlord will be under no
obligation to alter, change, decorate or improve Premises.
1.13 Guarantee: Tenant's obligations under this Lease shall be
unconditionally guaranteed by Patrick West and Laura West, husband and wife,
pursuant to the Guarantee (Lease) in the form of Exhibit H attached hereto and
made a part hereof.
2. DEMISE AND POSSESSION
2.01 Landlord leases to Tenant and Tenant leases from Landlord the
Premises described in 1.01. By entering the Premises, Tenant acknowledges that
it has examined the Premises and accepts the Premises in their present condition
subject only to any additional work Landlord has agreed to do and Landlord's
express warranties as stated on Exhibit B.
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Landlord expressly reserves its right to lease any other space available in the
Project to whom ever it wishes, further Tenant hereby acknowledges that it did
not rely on any other tenant remaining a tenant in the Project as a
consideration for entering into this Lease.
2.02 If for any reason Landlord cannot deliver possession of the
Premises on the date the Lease commences, Landlord shall not be subject to any
liability nor shall the validity of this Lease be affected. If Tenant has not
caused such delay there shall be a proportionate reduction of the Base Monthly
Rent covering the period between the commencement of the Lease Term and the date
when Landlord can deliver possession. However. Tenant, unless it is the cause of
the delay, has the right to cancel this Lease by written notification if
possession of the Premises is not delivered within one hundred eighty (180) days
of the date the Lease Term commences. Landlord may terminate this Lease by
giving written notice to Tenant if possession of the Premises is not delivered
within one hundred eighty (180) days of the date the lease is to commence.
2.03 For the period commencing on the date of mutual execution of
this Lease by Landlord and Tenant (the "Early Occupancy Date") and ending on the
Lease Commencement Date (the "Early Occupancy Period"), Tenant shall be entitled
to occupy the Premises for the limited purposes and subject to the terms and
conditions of this Section 2.03. Provided that Tenant's early occupancy rights
granted under this Section 2.03 comply with all applicable city code and other
governmental and administrative laws, rules, regulations, and requirements,
Tenant shall have the right, at Tenant's risk and at Tenant's sole cost and
expense, to enter onto the Premises at any time during the Early Occupancy
Period, in order to take measurements and prepare specifications for the
installation of Tenant's trade fixtures and equipment in the Premises. Landlord
shall have no liability or responsibility for loss of or damage or injury to any
of Tenant's employees, contractors, representatives, agents, or invitees, or to
any of Tenant's property on the Premises during the Early Occupancy Period,
except for damages caused by the intentional misconduct of Landlord. Tenant's
entry onto and use of the Premises during the Early Occupancy Period pursuant to
this Section 2.03 shall be subject to all of the terms and conditions of this
Lease, including, without limitation, Tenant's obligation to pay Additional Rent
and indemnity obligations hereunder, and excluding only the requirement to pay
Base Monthly Rent, except in the event Tenant commences business operations from
the Premises, in which case Tenant shall thereafter be responsible for the
payment of Base Monthly Rent thereafter for the remainder of the Early Occupancy
Period. Notwithstanding the foregoing, Landlord shall have no liability or
responsibility with respect to dust resulting from Landlord or Landlord's
contractor's construction or other activities which dust affects or damages
Tenant's equipment and property on or in the Premises. Tenant agrees to exercise
Tenant's rights hereunder during the Early Occupancy Period so as to not
interfere in any way with Landlord and Landlord's Contractor's construction of
the Premises and Landlord's Work.
3. BASE MONTHLY RENT
3.01 Base Monthly Rent: On the first day of every calendar month of
the Lease Term commencing January 1, 2001, Tenant will pay, without deduction or
offset, prior notice or demand. Base Monthly Rent at the place designated by
Landlord. However, the first month's Base Monthly Rent (Section 1.07),
Additional Rent (Section 5.05), and Security Deposit (Section 1.08) is due and
payable upon execution of this Lease. In the event, that the Term of this Lease
commences or ends on a day other than the first day of a calendar month, a
prorated amount of Base Monthly Rent and Additional Rent shall be due upon
execution and shall be calculated using a thirty (30) day month. In the event
this Lease is to commence upon a date not ascertained on execution, both parties
agree to complete and execute a Commencement Date Certificate in the form of
Exhibit "E" within ten (10) days of the Commencement Date, if applicable.
3.02 [Intentionally Omitted]
A. [Intentionally Omitted]
B. [Intentionally Omitted]
C. [Intentionally Omitted]
3.03 Any installment of rent or any other charge payable which is
not paid within ten (10) days after it becomes due will be considered past due
and Tenant will pay to Landlord as Additional Rent a late charge equal to the
product of the variable Prime Rate "Prime", plus six percent (6%) per annum as
charged by Bank of America, Nevada; times the amount of such installment amount
due, or eighteen percent (18%) per annum of such installment or the sum of
twenty-five dollars ($25.00), whichever is greater, for each month or fractional
month transpiring from the date due until paid. A twenty-five dollar ($25.00)
handling charge will be paid by Tenant to Landlord for each returned check and,
thereafter, Tenant will pay all future payments of rent or other charges due by
money order or cashier's check. In the event a late charge is assessed for three
(3) consecutive rental periods, whether or not it is collected, the rent shall
without further notice become due and payable quarterly in advance
notwithstanding any provision of this Lease to the contrary. If Tenant shall be
served with a demand for the payment of past due rent, any payments tendered
thereafter to cure any default by Tenant shall be made only by cashier's check.
3.04 The amount of the Base Monthly Rent includes projected
construction of Tenant's improvements as indicated on Exhibit "B" attached. In
the event that Tenant requests Landlord to construct additional improvements
and/or final construction costs exceed original estimates, such costs or
expenses upon itemized notice by Landlord shall be paid by Tenant to Landlord,
or Landlord may increase the Base Monthly Rent according to the terms and
conditions outlined on Exhibit "B", or elsewhere in this Lease.
4. COMMON AREAS
4.01 Definitions: "Common Areas": "Common Area" is defined as all
areas and facilities outside the Premises and within the exterior boundary line
of the Project that are provided and designated by Landlord for the
non-exclusive
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use of Landlord, Tenant and other lessees of the Project and their respective
employees, agents, customers and invitees. Common Areas include, but are not
limited to: all parking areas, loading and unloading areas, trash areas,
roadways, sidewalks, walkways, parkways, driveways, corridors, landscaped areas
and any restrooms used in common by lessees.
4.02 Tenant, its employees, agents, customers and invitees have the
non-exclusive right (in common with other Tenants, Landlord, and any other
person granted use by Landlord) to use of the Common Areas. Tenant agrees to
abide by and conform to, and to cause its employees, agents, customers and
invitees to abide by and conform to all rules and regulations established by
Landlord subject to provisions of paragraph 24.
4.03 Landlord has the right, in its sole discretion, from time to
time, to: 1) make changes to the Common Areas, including without limitation,
changes in the location, size, shape and number of driveways, entrances, parking
spaces, parking areas, ingress, egress, direction of driveways, entrances,
corridors parking areas and walkways; 2) close temporarily any of the Common
Areas for maintenance purposes so long as reasonable access to the Premises
remains available; 3) add additional buildings and improvements to the Common
Areas; 4) use the Common Areas while engaged in making additional improvements,
repairs or alterations to the Project or any portion thereof; do and perform any
other acts or make any other changes in, to or with respect to the Common Areas
and Project as Landlord may, in the exercise of sound business judgment, deem to
be appropriate.
5. ADDITIONAL RENT
5.01 All charges payable by Tenant other than Base Monthly Rent are
called "Additional Rent". Unless this lease provides otherwise, Additional Rent
is to be paid with the next monthly installment of Base Monthly Rent and is
subject to the provisions of 3.03. The term "rent" whenever used in this Lease
means Base Monthly Rent and Additional Rent.
5.02 Operating Costs
A. "Operating Costs" are all costs and expenses of ownership,
operation, maintenance, management, repair and insurance incurred by Landlord
for the Project including, but not limited to the following: all supplies,
materials, labor and equipment, used in or related to the operation and
maintenance of the Common Areas; all utilities, including but not limited to:
water, electricity, gas, heating, lighting, sewer, waste disposal related to the
maintenance or operation of the Common Areas; all air-conditioning and
ventilating costs related to the maintenance or operation of the Project; all
Landlord's costs in managing, maintaining, repairing, operating and insuring the
Project, including, for example, clerical, supervisory, and janitorial staff;
all maintenance, management and service agreements, including but not limited
to, janitorial, security, trash removal related to the maintenance or operation
of the Project; all legal and accounting costs and fees for licenses and permits
related to the ownership and operation of the Project; all insurance premiums
and costs of fire, casualty, and liability coverage, rent abatement and
earthquake insurance and any other type of insurance related to the Entire
Project, including any deductible for a loss attributable to the Premises; all
operation, maintenance and repair costs to the Common Areas, including but not
limited to, sidewalks, walkways, parkways, parking areas, loading and unloading
areas, trash areas, roadways, driveways, corridors, and landscaped area,
including for example, costs of resurfacing and restriping parking areas; all
maintenance and repair costs of building exteriors (including painting, asphalt
repair and replacement and roof maintenance, repair and replacement), restrooms
used in common by Tenants and signs and directories of the Project; amortization
(along with reasonable financing charges) of capital improvements made to the
Common Areas which may be required by any government authority or which will
improve the operating efficiency of the Project; a reasonable reserve for
repairs and replacement; a five percent (5%) fee for Landlord's supervision of
the Common Areas (five percent (5%) of the total above mentioned costs and
expenses incurred in a calendar year). Operating Costs will not include
depreciation of the Project, or (2) any Operating Cost that is reimbursable by
another tenant of the Project.
B. Tenant shall pay to Landlord Tenant's Proportionate Share of
the Operating Costs as indicated in 1.09. If there is a change in the square
footage of either the Project or the Premises during the term of this Lease the
Proportionate Share of the Tenant shall be adjusted accordingly. Such payment
shall be paid by Tenant with and in addition to the monthly payment of Base
Monthly Rent. Tenant shall, if Landlord so elects, pay to Landlord on a monthly
basis, in advance, the amount which Landlord reasonably estimates to be Tenant's
Proportionate Share of the Operating Costs. In the event of such election by
Landlord, Landlord shall periodically determine Tenant's share of the actual
Operating Costs, and in the event that the amount which Tenant has paid to
Landlord on account of the estimated Operating Costs is less than his share of
such actual Operating Costs, Tenant shall pay such difference to Landlord on the
next rent payment date. In the event that Tenant has paid to Landlord more than
his share of such actual Operating Costs, the amount of such difference shall be
credited against Tenant's payments of Operating Costs next due or if such a
period is at the end of the Lease term the amount of any overpayment shall be
promptly refunded to Tenant.
C. Failure by Landlord to provide Tenant with a statement by
April 1st of each year shall not constitute a waiver by Landlord of its right to
collect Tenant's share of Operating Costs or estimates for a particular calendar
year Landlord's right to charge Tenant for such expenses in subsequent years is
not waived.
5.03 Taxes
A. "Real Project Taxes" are: (I) any fee, license fee, license
tax, business license fee, commercial rental tax levy, charge, assessment,
penalty or tax imposed by any taxing authority against the Project; (ii) any tax
or fee on Landlord's right to receive, or the receipt of, rent or income from
the Project or against Landlord's business of leasing the Project, (iii) any tax
or charge for fire protection, streets, sidewalks, road maintenance, refuse or
other services provided to the Project by any governmental agency; (iv) any tax
imposed upon this transaction, or based upon a re-assessment of the Project due
to a change in ownership or transfer of all of part or Landlord's interest in
the Project; (v) any charge or fee replacing, substituting for, or in addition
to any tax previously included within the definition of real
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property tax; and (vi) the Landlord's cost of any tax protest relating to any of
the above. Real Project Taxes do not, however, include Landlord's federal or
state income, franchise, inheritance or estate taxes.
B. Tenant shall pay to Landlord Tenant's Proportionate Share of
the Real Project Taxes as indicated in 1.09. Such payment shall be paid by
Tenant annually upon being invoiced for such taxes in addition to the monthly
payment of Base Monthly Rent. Tenant shall, if Landlord so elects, pay to
Landlord on a monthly basis, in advance, the amount which Landlord reasonably
estimates to be Tenant's Proportionate Share of the Real Project Taxes. In the
event of such election by Landlord, Landlord shall periodically determine
Tenant's share of the actual Real Project Taxes, and in the event that the
amount which Tenant has paid to Landlord on account of the Real Project Taxes is
less than his share of such actual Real Project Taxes, Tenant shall pay such
difference to Landlord on the next rent payment date. In the event that Tenant
has paid to Landlord more than his share of such actual Real Project Taxes, the
amount of such difference shall be credited against Tenant's payment of Real
Project Taxes next due. If the Lease term is expired then Landlord shall
promptly refund any overpayment to Tenant.
C. Personal Property Taxes: Tenant will pay all taxes charged
against trade fixtures, furnishing, equipment or any other personal property
belonging to Tenant. Tenant will have personal property taxes billed separately
from the Project. If any of Tenant's personal property is taxed with the
Project, Tenant will pay Landlord the taxes for the personal property upon
demand by Landlord.
5.04 Based on Tenant's Proportionate Share defined in 1.09, Tenant
agrees to pay as Additional Rent to Landlord its share of any parking charges,
utility surcharges, occupancy taxes, or any other costs resulting from the
statutes or regulations, or interpretations thereof, enacted by any governmental
authority in connection with the use or occupancy of the Project or the parking
facilities serving the Project, or any part thereof.
5.05 Landlord by completing this paragraph may elect to have Tenant
pay a monthly estimate of the Additional Rent due from Tenant of 5.5 cents per
square foot, i.e. TWO THOUSAND, EIGHT HUNDRED EIGHTY-SEVEN AND 50/100
($2,887.50). Landlord shall make adjustments to this estimate based upon actual
costs and projected future costs. Landlord shall periodically determine the
balance between actual Additional Rent and Additional Rent paid by Tenant and
make adjustments in accordance with 5.02 and 5.03 above.
6. SECURITY DEPOSIT
6.01 If Tenant defaults with respect to any provision of this
Lease, Landlord may retain, use or apply all or any part of the Security Deposit
to compensate Landlord for any loss or damage suffered by Tenant's default
including but not limited to, the payment of Base Monthly Rent, Additional Rent
or other rental sums due, and for payment of amounts Landlord is obligated to
spend by reason of Tenant's default. If any portion is so retained, used or
applied, Tenant, upon demand, will deposit with Landlord an amount sufficient to
restore the deposit to its original amount, as adjusted per 3.02, except as
otherwise provided by law. Landlord will not be required to keep the Security
Deposit separate from its general funds, and Tenant will not be entitled to
interest on it. If Tenant fully and faithfully performs every provision of this
Lease, the Security Deposit or a balance thereof will be returned to Tenant
within 30 days after the expiration of this Lease or any renewals of this Lease.
In no event will Tenant have the right to apply any part of the Security Deposit
to any rents payable under this Lease.
7. USE OF PREMISES: QUIET CONDUCT
7.01 The Premises may be used and occupied only for Tenant's
Permitted Use as shown in 1.05 and for no other purpose, without obtaining
Landlord's prior written consent. Tenant will comply with all laws, ordinances,
orders and regulations affecting the Premises. Tenant will not perform any act
or carry on any practices that may injure the Project or the Premises or be a
nuisance or menace, or disturb the quiet enjoyment of other lessees in the
Project including but not limited to equipment which causes vibration, use or
storage of chemicals, or heat or noise which is not properly insulated. Tenant
will not cause, maintain or permit any outside storage on or about the Premises.
In addition, Tenant will not allow any condition or thing to remain on or about
the Premises which diminishes the appearance or aesthetic qualities of the
Premises and/or the Project or the surrounding property. The keeping of a dog or
other animal on or about the Premises is expressly prohibited.
7.02 As used in this section, the term "Hazardous Waste" means:
A. Those substances defined as "hazardous substances", "hazardous
materials", "toxic substances", "regulated substances", or "solid waste" in the
Toxic Substance Control Act, 15 U.S.C. ss. 2601 et. seq., as now existing or
hereafter amended ("TSCA"), the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, 42 U.S.C. ss. 9601 et. seq., as now
existing or hereafter amended ("CERCLA"), the Resource, Conservation and
Recovery Act of 1976, 42 U.S.C. Section 6901 et. seq., as now existing or
hereafter amended ("RCRA"), the Federal Hazardous Substances Act, 15 U.S.C. ss.
1261 et seq., as now existing or hereafter amended ("FHSA"), the Occupational
Safety and Health Act of 1970, 29 U.S.C. ss. 651 et. seq., as now existing or
hereafter amended ("OSHA"), the Hazardous Materials Transportation Act, 49
U.S.C. ss. 1801 et. seq., as now existing or hereafter amended ("HMTA"), and the
rules and regulations now in effect or promulgated hereafter pursuant to each
law referenced above;
B. Those substances defined as "hazardous waste", "hazardous
material", or "regulated substances" in Nev. Rev. Stat. ch 459, 1989 Nev. Stat.
ch 598 and 1989 Nev. Stat. ch 363, or in the regulations now existing or
hereafter promulgated pursuant thereto or in the Uniform Fire Code, 1988
edition;
C. Those substances listed in the United States Department of
Transportation table (49 CFR ss. 172.101 and amendments thereto) or by the
Environmental Protection Agency (or any successor agency) as hazardous
substances 140 CFR Part 302 and amendments thereto); and
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D. Such other substances, mixtures, materials and waste which are
regulated under applicable local, state or federal law, or which are classified
as hazardous or toxic under federal, state or local laws or regulations (all
laws, rules and regulations referenced in paragraphs (a), (b), (c) and (d) are
collectively referred to as "Environmental Laws").
7.03 Tenant's Covenants. Tenant does not intend to and Tenant will
not, nor will Tenant allow any other person (including partnerships,
corporations and joint ventures), during the term of this Lease to manufacture,
process, store, distribute, use, discharge or dispose of any Hazardous Waste in,
under or on the Project, the Common Areas, or any property adjacent thereto.
A. Tenant shall notify Landlord promptly in the event of any
spill or release of Hazardous Waste into, on, or onto the Project regardless of
the source of spill or release, whenever Tenant knows or suspects that such a
release occurred.
B. Tenant will not be involved in operations at or near the
Project which could lead to the imposition on the Tenant or the Landlord of
liability or the creation of a lien on the Project, under the Environmental
Laws.
C. Tenant shall, upon twenty-four (24) hour prior notice by
Landlord, permit Landlord or Landlord's agent access to the Project to conduct
an environmental site assessment with respect to the Project. Except in the case
of emergency, Landlord shall conduct such activities during normal business
hours.
7.04. Indemnity. Tenant for itself and its successors and assigns
undertakes to protect, indemnify, save and defend Landlord, its agents,
employees, directors, officers, shareholders, affiliates, consultants,
independent contractors, successors and assigns (collectively the "Indemnitees")
harmless from any and all liability, loss, damage and expense, including
reasonable attorneys' fees, claims, suits and judgments that Landlord or any
other Indemnitee, whether as Landlord or otherwise, may suffer as a result of,
or with respect to:
A. The violation by Tenant or Tenant's agents, employees,
invitees, licensees or contractors of any Environmental Law, including the
assertion of any lien thereunder and any suit brought or judgment rendered
regardless of whether the action was commenced by a citizen (as authorized under
the Environmental Laws) or by a government agency;
B. To the extent caused, directly or indirectly by Tenant or
Tenant's agents, employees, invitees, licensees or contractors, any spill or
release of or the presence of any Hazardous Waste affecting the Project whether
or not the same originates or emanates from the Project or any contiguous real
estate, including any loss of value of the Project as a result thereof;
C. To the extent caused, directly or indirectly by Tenant or
Tenant's agents, employees, invitees, licensees or contractors, any other matter
affecting the Project within the jurisdiction of the United States Environmental
Protection Agency, the Nevada State Environmental Commission, the Nevada
Department of Conservation and Natural Resources, or the Nevada Department of
Commerce, including costs of investigations, remedial action, or other response
costs whether such costs are incurred by the United States Government, the State
of Nevada, or any Indemnitee;
D. To the extent caused, directly or indirectly by Tenant or
Tenant's agents, employees, invitees, licensees or contractors, liability for
clean-up costs, fines, damages or penalties incurred pursuant to the provisions
of any applicable Environmental Law; and
E. To the extent caused, directly or indirectly by Tenant or
Tenant's agents, employees, invitees, licensees or contractors, liability for
personal injury or property damage arising under any statutory or common-law
tort theory, including, without limitation, damages assessed for the maintenance
of a public or private nuisance, or for the carrying of an abnormally dangerous
activity, and response costs.
7.05 Remedial Acts. In the event of any spill or release of or the
presence of any Hazardous Waste affecting the Project, caused by Tenant, its
employees, agents, invitees, licensees, or contractors, whether or not the same
originates or emanates from the Project or any contiguous real estate, and/or if
Tenant shall fail to comply with any of the requirements of any Environmental
Law, Landlord may, without notice to Tenant, at its election, but without
obligation so to do, gives such notices and/or cause such work to be performed
at the Project and/or take any and all other actions as Landlord shall deem
necessary or advisable in order to remedy said spill or release of Hazardous
Waste or cure said failure of compliance and any amounts paid as a result
thereof, together with interest at the rate equal to the product of the variable
Prime Rate "Prime", plus six percent (6%) per annum as charged by Bank of
America, Nevada; times the amount of such installment amount due, or eighteen
percent (18%) per annum of such installment or the sum of twenty-five dollars
($25.00), whichever is greater, for each month or fractional month transpiring
from the date due until paid.
7.06 Settlement. Upon giving Tenant ten (10) days prior notice,
Landlord shall have the right in good ??? to pay, settle or compromise, or
litigate any claim, demand, loss, liability, cost, charge, suit, order, judgment
or adjudication relating to environmental conditions on or affecting the
Premises, provided that Landlord reasonably and in good faith believes that
Tenant is liable therefor, whether liable or not, without the consent or
approval of Tenant unless Tenant within said ten (10) day period shall protest
in writing and simultaneously with such protest deposit with Landlord collateral
satisfactory to Landlord sufficient to pay and satisfy any penalty and/or
interest which may ??? as a result of such protest and any judgment or judgments
as may result, together with attorney's fees and expense and costs of
environmental consultants; provided, however, that Landlord shall reimburse
Tenant for all costs and fees and by Tenant under this Section 7.06 for which
Tenant obtains a final judgment from a court of competent jurisdiction that
Landlord is responsible therefore.
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7.07 Landlord represents to Tenant that, as of the Lease
Commencement Date, Landlord has no "knowledge" (as such term is hereinafter
defined) of any reportable spill, release, or amount of Hazardous Waste in
violation of any Environmental Law, in, on, or affecting the Project. The term
"knowledge" as used in this Section 7.07 shall mean the actual knowledge of E.
Gordon Zack and Douglas Lanning without duty of investigation. In no event shall
knowledge of any fact, event, or situation be constructively imputed to
Landlord.
7.08 Landlord agrees to indemnify Tenant against any and all costs
and liabilities resulting from the violation by the Premises of any
Environmental Law (a "Violation") that occurred prior to Tenant's occupancy of
Premises under this Lease or otherwise; provided, however, that Landlord's
obligation under this Section 7.08 shall not apply to or shall be
proportionately reduced, as appropriate, to the extent the cause of the
Violation is attributable, directly or indirectly, in whole or in part, to the
acts or omissions of Tenant or Tenant's agents, employees, invitees, licensees,
contractors, or representatives.
8. PARKING
8.01 Tenant and Tenant's customers, suppliers, employees, and
invitees have the non-exclusive right to park in common with other lessees in
the parking facilities as designated by Landlord. Tenant agrees not to
overburden the parking facilities and agrees to cooperate with Landlord and
other lessees in the use of the parking facilities. Landlord reserves the right
to, on an equitable basis, assign specific spaces with or without charge to
Tenant as Additional Rent, make changes in the parking layout from time to time,
and to establish reasonable time limits on parking.
9. UTILITIES
9.1 Tenant will be responsible for and shall pay for all water,
gas, heat, light, power, sewer, electricity, or other services metered,
chargeable to or provided to the Premises separate from and in addition to the
costs outlined in Section 5.02 dealing with the utility costs for Common Area
Maintenance. Landlord reserves the right to install separate meters for any such
utility.
9.2 Landlord will not be liable or deemed in default to Tenant nor
will there be any abatement of rent for any interruption or reduction of
utilities or services not caused by any act of Landlord or any act reasonably
beyond Landlord's control. Tenant agrees to comply with energy conservation
programs implemented by Landlord by reason of enacted laws or ordinances.
9.3 Tenant will contract and pay for all telephone and such other
services for the Premises subject to the provisions of 10.03.
10. ALTERATIONS, MECHANIC'S LIENS
10.01 Tenant will not make any alterations to the Premises without
Landlord's prior written consent. Landlord's consent shall be contingent upon
Tenant providing Landlord with the following items or information, all subject
to Landlord's approval: (I) Tenant's contractor, (ii) certificates of insurance
by Tenant's contractor for commercial general liability insurance with limits
not less than $2,000,000 General Aggregate, $1,000,000 Products/Complete
Operations Aggregate, $l,000,000 Personal & Advertising Injury, $1,000,000 Each
Occurrence, $50,000 Fire Damage, $5,000 Medical Expense, $1,000,000 Auto
Liability (Combined Single Limit, including Hired/Non-Owned Auto Liability).
Workers Compensation, including Employer's Liability, as required by state
statute endorsed to show Landlord as an additional insured and for worker's
compensation as required and (iii) detailed plans and specifications for such
work. Tenant agrees that it will have its contractor execute a waiver of
mechanic's lien and that Tenant will remove any mechanic's lien placed against
the Project within ten (10) days of receipt of notice of lien. In addition,
before alterations may begin, valid building permits or other permits or
licenses required must be furnished to Landlord, and, once the alterations
begin, Tenant will diligently and continuously pursue their completion. At
Landlord's option, any alterations may become part of the realty and belong to
Landlord. If requested by Landlord, Tenant will pay, prior to the commencement
of the construction, an amount determined by Landlord necessary to cover the
costs of demolishing such alterations and/or the cost of returning the Premises
to its condition prior to such alterations. As a further condition to giving
such consent, Landlord may require Tenant to provide Landlord, at Tenant's sole
cost and expense, a payment and performance bond in form acceptable to Landlord,
in a principal amount not less than one and one-half times the estimated costs
of such alterations, to ensure Landlord against any liability for mechanic's and
materialmen's liens and to ensure completion of work. Tenant, at Landlord's
option, shall at Tenant's expense remove all alterations and repair all damage
to the Premises.
10.02 Notwithstanding anything in 10.01, Tenant may, with written
consent of Landlord, install trade fixtures, equipment, and machinery in
conformance with the ordinances of the applicable city and county, and they may
be removed upon termination of its Lease provided the Premises are not damaged
by their removal.
10.03 Any private telephone systems and/or other related
telecommunications equipment and lines may be installed within Tenant's Premises
and, upon termination of this Lease removed and the Premises restored to the
same condition as before such installation.
10.04 Tenant will pay all costs for alterations and will keep the
Premises, the Project and the underlying property free from any liens arising
out of work performed for materials furnished to or obligation incurred by
Tenant.
10.05 Upon prior notice to Tenant, except in the case of emergency,
for which no notice is required, Landlord will have the right to construct or
permit construction of tenant improvements in or about the Project for existing
and new Tenants and to alter any public areas in and around the Project.
Notwithstanding anything which may be contained in this Lease, Tenant
understands this right of Landlord and agrees that such construction will not be
deemed to constitute a breach of this Lease by Landlord and Tenant waives any
such claim which it might have arising from such
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construction, Landlord agrees to exercise commercially reasonable efforts in
connection with such construction so that such construction does not materially
and unreasonably interfere with Tenant's Permitted Use of the Premises.
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11. FIRE INSURANCE: HAZARDS AND LIABILITY INSURANCE
11.01 Except as expressly provided as Tenant's Permitted Use, or as
otherwise consented to by Landlord in writing, Tenant shall not do or permit
anything to be done within or about the Premises which will increase the
existing rate of insurance on the Project and shall, at its sole cost and
expense, comply with any requirements, pertaining to the Premises, of any
insurance organization insuring the Project and Project-related apparatus.
Tenant agrees to pay to Landlord, as Additional Rent, any increases in premiums
on policies resulting from Tenant's Permitted Use or other use consented to by
Landlord which increases Landlord's premiums or requires extended coverage by
Landlord to insure the Premises.
11.02 Tenant, at all times during the term of this Lease and at
Tenant's sole expense, will maintain a policy of standard fire and extended
coverage insurance with "all risk" coverage on all Tenant's improvements and
alterations in or about the Premises and on all personal property and equipment
to the extent of at least ninety percent (90%) of their full replacement value.
The proceeds from this policy will be used by Tenant for the replacement of
personal property and equipment and the restoration of Tenant's improvements
and/or alterations. This policy will contain an express waiver, in favor of
Landlord, of any right of subrogation by the insurer.
11.03 Tenant, at all times during the term on this Lease and at
Tenant's sole expense, will maintain a policy of commercial general liability
coverage with limits of not less than $2,000,000 combined single limit for
bodily injury and property damage insuring against all liability of Tenant and
its authorized representatives arising out of or in connection with Tenant's use
or occupancy of the Premises.
11.04 All insurance will name Landlord and/or Landlord's designated
partners and affiliates as an additional insured and will include an express
waiver of subrogation by the insurer in favor of Landlord and Tenant and will
release Landlord from any claims for damage to any person, to the Premises, and
to the Project, and to Tenant's personal property, equipment, improvements and
alterations in or on the Premises of the Project, caused by or resulting from
risks which are to be insured against by Tenant under this Lease. All insurance
required to be provided by Tenant under this Lease will (a) be issued by an
insurance company authorized to do business in the state in which the Premises
are located and which has and maintains a rating of A/X in the Best's Insurance
Reports or the equivalent, (b) be primary and noncontributing with any insurance
carried by Landlord, and (c) contain an endorsement requiring at least thirty
(30) days prior written notice of cancellation to Landlord before cancellation
or change in coverage, scope or limit of any policy. Tenant will deliver a
certificate of insurance or a copy of the policy to Landlord within thirty (30)
days of execution of this Lease and will provide evidence of renewed insurance
coverage at each anniversary, and prior to the expiration of any current
policies; however, in no event will Tenant be allowed to occupy the Premises
before providing adequate and acceptable proof of insurance as stated above.
Tenant's failure to provide evidence of this coverage to Landlord may, in
Landlord's sole discretion, constitute a default under this Lease.
11.05 Landlord agrees that Tenant shall not be responsible for
payment of the deductible for such insurance to the extent such deductible is
greater than that applicable to other buildings in Landlord's portfolio located
in Reno, Nevada.
12. INDEMNIFICATION AND WAIVER OF CLAIMS
12.01 Tenant waives all claims against Landlord for damage to any
property in or about the Premises and for injury to any persons, including death
resulting therefrom, regardless of cause or time of occurrence, except to the
event caused by Landlord's gross negligence or intentional misconduct. Tenant
will defend, indemnify and hold Landlord harmless from and against any and all
claims, actions, proceedings, expenses, damages and liabilities, including
attorney's fees, arising out of, connected with, or resulting from any use of
the Premises by Tenant, its employees, agents, visitors or licensees,
including, without limitation, any failure of Tenant to comply fully with all of
the terms and conditions of this Lease except for any damage or injury which is
the direct result of gross negligence or intentional misconduct by Landlord, its
employees, agents, visitors or licensees.
13. REPAIRS
13.01 Tenant shall, at its sole expense, keep and maintain the
Premises and every part thereof (excepting common use equipment, which Landlord
agrees to repair or replace pursuant to Section 5.02 unless damages are due to
the neglect or intentional acts of Tenant or its agents, employees, visitors, or
licensees), including interior windows, Skylights, doors, plate glass, any store
fronts and the interior of the Premises, in good and sanitary order, condition
and repair. Tenant will, also, at its sole cost keep and maintain all utilities,
fixtures, plumbing and mechanical equipment used by Tenant in good order and
repair and furnish all expendables (light bulbs, paper goods, soaps, etc.) used
at the Premises. The standard for comparison and need of repair will be the
condition of the Premises at the at the time of commencement of this Lease and
all repairs will be made by a licensed and bonded contractor approved by
Landlord.
13.02 Tenant will not make repairs to the Premises at the cost of
Landlord whether by deductions of rent or otherwise, or vacate the Premises or
terminate the Lease if repairs are not made. If during the Term, any alteration,
addition or change to the Premises is required by legal authorities. Tenant, at
its sole expense, shall promptly make the same. Landlord reserves the right to
make any such repairs not made or maintained in good condition by Tenant and
Tenant shall reimburse Landlord for all such costs upon demand.
13.03 If repairs deemed necessary by Landlord or any government
authority are not made by Tenant the prescribed time frame as requested in
writing, Tenant shall be in default of this Lease.
13.04 Tenant shall, at its own expense, within thirty days of lease
commencement, contract with a vendor acceptable to Landlord for the maintenance
service of the HVAC which will be furnished to the Landlord upon request
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If Tenant fails to obtain and maintain such a maintenance service contract
Landlord shall have the right to obtain such a maintenance service contract at
the expense of Tenant.
13.05 Landlord Maintenance and Repairs. Landlord shall repair,
maintain, and replace, as necessary, (i) the structural portions of the roof,
structural sidewalls, and foundation of the Building, and (ii) the Common Areas
of the Project, except that Landlord shall not be responsible for any
maintenance, repairs, or replacements provided herein caused by Tenant's misuse
of the Premises, or Tenant's or Tenant's agents', employees', invitees',
licensees', or contractors' negligence or intentional misconduct, or by reason
of failure of Tenant to perform or observe any conditions or agreements
contained in this Lease. Landlord shall not be required to commence any
maintenance, repairs, or replacements hereunder and shall not have any liability
or responsibility therefor, except upon notice of the need therefor from Tenant.
All maintenance, repair, and replacement costs incurred by Landlord hereunder
shall also be considered part of the Operating Costs of the Project or be
considered in calculating reserves, as applicable, as specified in paragraph
5.02A above. Landlord agrees to exercise commercially reasonable efforts to
conduct such matters as promptly as reasonably possible after receipt of notice
from Tenant and a the manner which will not unreasonably and materially
interfere with Tenant's occupancy of, and the conduct of Tenant's Permitted Use
from, the Premises.
14. AUCTIONS, SIGNS, AND LANDSCAPING
14.01 Tenant will not conduct or permit to be conducted any sale by
auction on the Premises. Landlord will have the right to control landscaping and
approve the placement, size, and quality of signs pursuant to Exhibit "F", "Sign
Criteria". Tenant will not make alterations or additions to the landscaping and
will not place any signs nor allow the placement of any signs, which are visible
from the outside, on or about any building of the Project, nor in any landscape
area, without the prior written consent of Landlord. Landlord will have the
right in its sole discretion to withhold its consent. Any signs not in
conformity with this Lease or in accordance with the provisions of Exhibit "F"
may be removed by Landlord at Tenant's expense.
15. ENTRY BY LANDLORD
15.01 Tenant will permit Landlord and Landlord's agents to enter the
Premises at all reasonable times upon reasonable notice from Landlord (except in
the case of emergency, for which no notice is required) for the purpose of
inspecting the same, or for the purpose of maintaining the Project, or for the
purpose of making repairs, alterations or additions to any portion of the
Project, inducing the erection and maintenance of such scaffolding, canopies,
fences and props as may be required, or for the purpose of posting notices of
nonresponsibility for alterations, additions or repairs, or for the purpose of
showing the Premises to prospective tenants during the last six months of the
Lease Term, or placing upon the Project any usual or ordinary "for sale" signs,
without any rebate of rents and without any liability to Tenant for any loss of
occupation or quiet enjoyment of the Premises thereby occasioned. Tenant will
permit Landlord at any time within sixty (60) days prior to the expiration of
this Lease, to place upon the Premises any usual or ordinary "to let" or "to
lease" signs. Tenant will not install a new or additional lock or any bolt on
any door of the Premises without the prior written consent of Landlord, which
will not be unreasonably withheld. If Landlord gives its consent, such work
shall be undertaken by a locksmith approved by Landlord, at Tenant's sole cost.
Landlord retains the right to charge Tenant for restoring any altered doors to
their condition prior to the installation of the new or additional locks.
16. ABANDONMENT
16.01 Tenant will not vacate or abandon the Premises, which shall be
deemed to occur any time during the Lease Term if Tenant does not conduct
business for a period of fifteen (15) consecutive days and/or leaves the
Premises unoccupied for any period of time. If Tenant abandons, vacates or
surrenders the Premises, or is dispossessed by process of law, or otherwise, any
personal property belonging to Tenant left in or about the Premises will, at the
option of Landlord be deemed abandoned and may be disposed of by Landlord in the
manner provided for by the laws of the state in which the Premises are located.
17. DESTRUCTION
17.01 In the case of total destruction of the Premises, or any
portion thereof substantially interfering with Tenant's use of the Premises,
whether by fire or other casualty, not caused by the fault or negligence of
Tenant, its agents, employees, servants, contractors, subtenants, licensees,
customers or business invitees, this Lease shall terminate except as herein
provided. If Landlord notifies Tenant in writing within forty-five (45) days of
such destruction of Landlord's election to repair said damage, and if Landlord
proceeds to and does repair such damage with reasonable dispatch, this Lease
shall not terminate, but shall continue in full force and effect, except that
Tenant shall be entitled to a reduction in the Base Monthly Rent in an amount
equal to that proportion of the Base Monthly Rent which the number of square
feet of floor space in the unusable portion bears to the total number of square
feet of floor space in the Premises. Said reduction shall be prorated so that
the rent shall only be reduced for those days any given area is actually
unusable. In determining what constitutes reasonable dispatch, consideration
shall be given to delays caused by labor dispute, civil commotion, war, warlike
operations, invasion, rebellion, hostilities, military or usurped power,
sabotage, governmental regulations or control, fire or other casualty, inability
to obtain any materials or services, acts of God and other causes beyond
Landlord's control. If this Lease is terminated pursuant to this Section 17 and
if Tenant is not in default hereunder, rent shall be prorated as of the date of
termination, any security deposited with Landlord shall be returned to Tenant,
less any reasonable offsets and all rights and obligations hereunder shall cease
and terminate.
17.02. Notwithstanding the foregoing provisions, in the event the
Premises, or any portion thereof, shall be damaged by fire or other casualty due
to the fault or negligence of Tenant, its agents, employees, servants,
contractors, subtenants, licensees, customers or business invitees, then,
without prejudice to any other rights and remedies of Landlord, this Lease shall
not terminate, the damage shall be repaired at Tenant's cost, and there shall be
no apportionment or abatement of any rent.
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17.03. In the event of any damage not limited to, or not including,
the Premises, such that the building of which the Premises is a part is damaged
to the extent of twenty-five (25%) percent or more of the cost of replacement,
or the buildings (taken in the aggregate) of the Project owned by Landlord shall
be damaged to the extent of more than twenty-five (25%) of the aggregate cost
of replacement. Landlord may elect to terminate this Lease upon giving notice of
such election in writing to Tenant within ninety (90) days after the occurrence
of the event causing the damage.
17.04. The provisions of this Section 17 with respect to Landlord
shall be limited to such repair as is necessary to place the Premises in the
condition specified for Landlord's work by Exhibit B (if applicable) and when
placed in such condition the Leased Property shall be deemed restored and
rendered tenantable promptly following which time Tenant, at Tenant's expense
shall perform Tenant's work required by Exhibit B (if applicable) and Tenant
shall also repair or replace its stock in trade, fixtures, furniture,
furnishings, floor coverings and equipment, and if Tenant has closed, Tenant
shall promptly reopen for business.
17.05. All insurance proceeds payable under any fire and/or rental
insurance maintained by Landlord shall be payable solely to Landlord and Tenant
shall have no interest therein. Tenant shall in no case be entitled to
compensation for damages on account of any annoyance or inconvenience in making
repairs under any provision of this Lease. Except to the extent provided for in
this Section 17, neither the rent payable by Tenant nor any of Tenant's other
obligations under any provision of this Lease shall be affected by any damage to
or destruction of the Premises or any portion thereof by any cause whatsoever.
18. ASSIGNMENT, SUBLETTING AND TRANSFERS OF OWNERSHIP
18.01 Tenant will not, without Landlord's prior written consent,
which shall not be unreasonably withheld subject to the provisions of this
Article 18., assign, sell, mortgage, encumber, convey or otherwise transfer all
or any part of Tenant's leasehold estate, or permit the Premises to be occupied
by anyone other than Tenant and Tenant's employees or sublet the premises or any
portion thereof (collectively called "Transfer"). Tenant must supply Landlord
with any and all documents deemed necessary by Landlord to evaluate any proposed
Transfer at least sixty (60) days in advance of Tenant's proposed Transfer date.
18.02 Landlord need not consent to any Transfer for reasons
including, but not limited to, whether or not: (a) in the reasonable judgment of
Landlord the transferee is of a character or is engaged in a business which is
not in keeping with the standard of Landlord for the Project; (b) in the
reasonable judgment of Landlord any purpose for which the transferee intends to
use the Premises is not in keeping with the standards of Landlord for the
Project; provided in no event may any purpose for which transferee intends to
use the Premises be in violation of this Lease; (c) the portion of the Premises
subject to the transfer is not regular in shape with appropriate means of
entering and exiting, including adherence to any local, county or other
governmental codes, or is not otherwise suitable for the normal purposes
associated with such a Transfer; or (d) Tenant is in default under this Lease or
any other Lease with Landlord.
18.03 In the event Landlord consents to a Transfer, Tenant will pay
Landlord seventy percent (70%) of the excess, if any, of the rent and other
charges reserved in the Transfer over the allocable portion of the rent and
other charges hereunder for that portion of the Premises subject to the
Transfer. For the purpose of this section, the rent reserved in the Transfer
will be deemed to include any lump sum payment or other consideration given to
Tenant in consideration for the Transfer. Tenant will pay or cause the
transferee to pay to Landlord this additional rent together with the monthly
installments of rent due.
18.04 Any consent to any Transfer which may be given by Landlord, or
the acceptance of any rent, charges or other consideration by Landlord from
Tenant or any third party, will not constitute a waiver by Landlord of the
provisions of this Lease or a release of Tenant from the full performance by it
of the covenants stated herein; and any consent given by Landlord to any
Transfer will not relieve Tenant (or any transferee of Tenant) from the above
requirements for obtaining the written consent of Landlord to any subsequent
Transfer.
18.05 If a default under this Lease should occur while the Premises
or any part of the Premises are assigned, sublet or otherwise transferred,
Landlord, in addition to any other remedies provided for within this Lease or by
law, may at its option collect directly from the transferee all rent or other
consideration becoming due to Tenant under the Transfer and apply these monies
against any sums due to Landlord by Tenant; and Tenant authorizes and directs
any transferee to make payments of rent or other consideration direct to
Landlord upon receipt of notice from Landlord. No direct collection by Landlord
from any transferee should be construed to constitute a novation or a release of
Tenant or any guarantor of Tenant from the further performance of its
obligations in connection with this Lease.
18.06 If Tenant is a corporation or a partnership, the issuances of
any additional stock or equity interest and/or the transfer, assignment or
hypothecation of any stock or interest in such corporation or partnership in the
aggregate in excess of fifty percent (50%) of such interests, as the same may be
constituted as of the date of this lease, whether directly or indirectly, shall
be deemed to be a Transfer within the meaning of this Section 18.
18.07 In the event Tenant requests Landlord's consent to an
Assignment, Sub-Let or Transfer of Tenant's interest in the leased Premises,
Tenant agrees to pay Landlord all reasonable attorney's fees incurred by
Landlord for any legal services for document review of any and all documents
deemed necessary by Landlord and Tenant to Assign, Sub-let or Transfer Tenant's
interest in the leased Premises.
18.08 Notwithstanding the foregoing provisions of this
Article 18., and provided that Tenant complies with all of the provisions of
this Article 18., Landlord hereby consents to the assignment of Tenant's entire
interest in the Lease in connection with any sale of stock, merger, or
reorganization so long as the surviving or controlling entity or shareholder
has a net worth at least equal to that of Tenant's as of the Lease Commencement
Date, specifically assumes all obligations of Tenant under this Lease, and
otherwise agrees to comply with the terms and condition of this Lease
("Permitted Transfer"). Concurrently with any Permitted Transfer, Tenant must
also make a "Permitted Transfer" under
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the Adjustment Premises Lease as defined in Paragraph 19.01F
below. No such Permitted Transfer shall release or otherwise
affect Tenant's or any guarantor's obligations under this Lease,
or constitute an express or implied consent to any other Transfer
of all or any part of Tenant's leasehold estate, or the occupation
of the Premises by anyone other than Tenant or Tenant's employees.
19. BREACH BY TENANT
19.01 Tenant will be in breach of this Lease if at any
time during the term of this Lease (and regardless of the pendency
of any bankruptcy, reorganization, receivership, insolvency or
other proceedings in law, in equity or before any administrative
tribunal which have or might have the effect of preventing Tenant
from complying with the terms of this Lease):
A. Tenant fails to make payment of any installment of Base
Monthly Rent, Additional Rent, or of any other sum herein
specified to be paid by Tenant, within ten (10) days of the due
date thereof; or
B. Tenant fails to observe or perform any of its other
covenants, agreements or obligations hereunder, and such failure
is not cured within ten (10) days after Landlord's written notice
to Tenant of such failure; provided, however, that if the nature
of Tenant's obligation is such that more than ten (10) days are
required for performance, then Tenant will not be in breach if
Tenant commences performance within such 10 day period and
thereafter diligently prosecutes the same to completion; or
C. Tenant, Tenant's assignee, subtenant, guarantor, or
occupant of the Premises becomes insolvent, makes a transfer in
fraud of its creditors, makes a transfer for the benefit of its
creditors, is the subject of a bankruptcy petition, is adjudged
bankrupt or insolvent in proceedings filed against Tenant, a
receiver, trustee, or custodian is appointed for all or
substantially all of Tenant's assets, fails to pay its debts as
they become due, convenes a meeting of all or a portion of its
creditors, or performs any acts of bankruptcy or insolvency,
including the selling of its assets to pay creditors; or
D. Tenant has abandoned the Premises as defined in
paragraph 16 above.
E. Tenant fails to take possession of the Premises within
thirty (30) days of receiving notice by Landlord that the Premises
are available.
F. Tenant breaches or otherwise defaults under the lease
between Landlord and Tenant of the same date as this Lease for the
lease of the approximately two hundred twenty-three thousand
(223,000) square foot portion of the Building (Suite 101) adjacent
to the Premises (the "Adjacent Premises Lease").
20. REMEDIES OF LANDLORD
20.01 Nothing contained herein shall constitute a
waiver of Landlord's right to recover damages by reason of Landlord's efforts
to mitigate the damage to it by Tenant's default; nor shall anything in this
Section adversely affect Landlord's right, as in this Lease elsewhere provided,
to indemnification against liability for injury or damages to persons or
property occurring prior to a termination of this Lease.
20.02 All cure periods provided herein shall run
concurrently with any periods provided by law.
20.03 In the event of default, as designated herein above,
in addition to any other rights or remedies provided for herein or at law or in
equity, Landlord, at its sole option, shall have the following rights:
A. The right to declare the term of this Lease ended and
reenter the Premises and take possession thereof, and to terminate all of the
rights of Tenant in and to the Premises.
B. The right, without declaring the term of this Lease
ended, to reenter the Premises and to occupy the same, or any portion there of,
for and on account of the Tenant as hereinafter provided, and Tenant shall be
liable for and pay to Landlord on demand all such expenses as Landlord may have
paid, assumed or incurred in recovering possession of the Premises, including
costs, expenses, attorney's fees and expenditures placing the same in good
order, or preparing or altering the same for reletting, and all other expenses,
commissions and charges paid by the Landlord in connection with reletting the
Premises. Any such reletting may be for the remainder of the term of this Lease
or for a longer or shorter period. Such reletting shall be for such rent and on
such other terms and conditions as Landlord, in its sole discretion, deems
appropriate. Landlord may execute any lease made pursuant to the terms hereof
either in the Landlord's own name or assume Tenant's interest in any existing
subleases to any tenant of the Premises, as Landlord may see fit, and Tenant
shall have no right or authority whatsoever to collect any rent from such
tenants, subtenants, of the Premises. In any case, and whether or not the
Premises or any part thereof is relet, Tenant, until the end of the Lease term
shall be liable to Landlord for an amount equal to the amount due as Rent
hereunder, less net proceeds, if any of any reletting effected for the
account of Tenant. Landlord reserves the right to bring such actions for the
recovery or any deficits remaining unpaid by the Tenant to the Landlord
hereunder as Landlord may deem advisable from time to time without being
obligated to await the end of the term of the Lease. Commencement of
maintenance of one or more actions by the Landlord in this connection shall not
bar the Landlord from bringing any subsequent actions for further accruals. In
no event shall Tenant be entitled to any excess rent received by Landlord over
and above that which Tenant is obligated to pay hereunder; or
C. The right, even though it may have relet all or any
portion of the Premises in accordance with the provisions of subsection B.
above, to thereafter at any time elect to terminate this Lease for such previous
default on the part of the Tenant, and to terminate all the rights of Tenant in
and to the Premises.
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20.04 Pursuant to the rights of re-entry provided above.
Landlord may (in accordance with its rights and obligations under Nevada law)
remove all persons from the Premises and may, but shall not be obligated to.
remove all property therefrom, and may, but shall not be obligated to, enforce
any rights Landlord may have against said property or store the same in any
public or private warehouse or elsewhere at the cost and for the account of
Tenant or the owner or owners thereof. Tenant agrees to hold Landlord free and
harmless from any liability whatsoever for the removal and/or storage of any
such property, whether of Tenant or any third party whomsoever, except to the
extent caused by the gross negligence or intentional misconduct of Landlord.
Such action by the Landlord shall not be deemed to have terminated this Lease.
20.05 If Tenant breaches this Lease and abandons the
Premises before the end of the term, or if its right of possession is terminated
by Landlord because of Tenant's breach of this Lease, then this Lease may be
terminated by Landlord at its option. On such Termination Landlord may recover
from Tenant, in addition to the remedies permitted at law:
A. The worth, at the time of the award, of the unpaid Base
Monthly Rents and Additional Rents which had been earned at the time this Lease
is terminated.
B. The worth, at the time of the award, of the amount by
which the unpaid Base Monthly Rents and Additional Rents which would have been
earned after the date of termination of this Lease until the time of award
exceeds the amount of the loss of rents that Tenant proves could be reasonably
avoided;
C. The worth, at the time of the award, of the amount by
which the unpaid Base Monthly Rent and Additional Rents for the balance of the
Lease Term after the time of award exceeds the amount of such rental loss for
such period as the Tenant proves could have been reasonably avoided; and
D. Any other amount, and court costs, necessary to
compensate Landlord for all detriment proximately caused by Tenant's breach of
its obligations under this Lease, or which in the ordinary course of events
would be likely to result therefrom. The detriment proximately caused by
Tenant's breach will include, without limitation, (I) expenses for cleaning,
repairing or restoring the Premises, (ii) expenses for altering, remodeling or
otherwise improving the Premises for the purpose of reletting the Premises,
(iii) brokers' fees and commissions, advertising costs and other expenses of
reletting the Premises, (iv) costs of carrying the Premises such as taxes,
insurance premiums, utilities and security precautions, (v) expenses of
retaking possession of the Premises, (vi) reasonable attorney's fees and court
costs, (vii) any unearned brokerage commissions paid in connection with this
Lease, (viii) reimbursement of any previously waived Base Rent, Additional
Rent, free rent or reduced rental rate, and (ix) any concession made or paid by
Landlord to the benefit of Tenant in consideration of this Lease including, but
not limited to, any moving allowances, contributions or payments by Landlord
for tenant improvements or build-out allowances or assumptions by Landlord of
any of the Tenant's previous lease obligations.
20.06 In any action brought by the Landlord to enforce any
of its rights under or arising from this Lease, Landlord shall be entitled to
receive its costs and legal expenses including reasonable attorneys' fees,
whether or not such action is prosecuted to judgment
20.07 The waiver by Landlord of any breach or default of
Tenant hereunder shall not be a waiver of any preceding or subsequent breach of
the same or any other term. Acceptance of any Rent payment shall not be
construed to be a waiver of the Landlord of any preceding breach of the Tenant.
20.08 All past due amounts owed by Tenant under the terms
of this Lease shall bear interest at twelve percent per annum unless otherwise
stated.
21. SURRENDER OF LEASE NOT MERGER
21.01 The voluntary or other surrender of this Lease by
Tenant, or mutual cancellation thereof, will not work a merger and will, at the
option of Landlord, terminate all or any existing transfers, or may, at the
option of Landlord, operate as an assignment to it of any or all of such
transfers.
22. ATTORNEYS FEES/COLLECTION CHARGES
22.01 In the event of any legal action or proceeding
between the parties hereto, reasonable attorneys' fees and expenses of the
prevailing party in any such action or proceeding will be added to the judgment
therein. Should Landlord be named as defendant in any suit brought against
Tenant in connection with or arising out of Tenant's occupancy hereunder, Tenant
will pay to Landlord its costs and expenses incurred in such suit, including
reasonable attorney's fees except for any portion of costs, expenses, and
attorneys' fees attributable to the negligence or intentional misconduct of
Landlord.
22.02 If Landlord utilizes the services of any attorney
at law for the purpose of collecting any rent due and unpaid by Tenant after
five (5) days written notice to Tenant of such nonpayment of rent or in
connection with any other breach of this Lease by Tenant, Tenant agrees to pay
Landlord reasonable attorneys' fees as determined by Landlord for such services,
regardless of the fact that no legal action may be commenced or filed by
Landlord.
23. CONDEMNATION
23.01 If twenty-five percent (25%) or more of the square
footage of the Premises is taken for any public or quasi-public purpose by any
lawful government power or authority, by exercise of the right of appropriation,
reverse condemnation, condemnation or eminent domain, or sold to prevent such
taking, and if the remaining portion of the Premises will not be reasonably
adequate for the operation of Tenant's business after Landlord completes such
repairs
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or alterations as Landlord elects to make, either Tenant or the Landlord may at
its option terminate this Lease by notifying the other party hereto of such
election in writing within twenty (20) days after such taking. Tenant will not
because of such taking assert any claim against the Landlord or the taking
authority for any compensation because of such taking, and Landlord will be
entitled to receive the entire amount of any award without deduction for any
estate of interest of Tenant. If less than twenty-five percent (25%) of the
Premises is taken, Landlord at its option may terminate this Lease. If Landlord
does not so elect, Landlord will promptly proceed to restore the Premises to
substantially its same condition prior to such partial taking, allowing for any
reasonable effects of such taking, and a proportionate allowance based on the
loss of square footage will be made to Tenant for the rent corresponding to the
time during which, and to the part of the Premises, which, Tenant is deprived on
account of such taking and restoration.
24. RULES AND REGULATIONS
24.01 Tenant will faithfully observe and comply with any
Rules and Regulations reasonably promulgated by Landlord for the Project and
Landlord reserves the right to reasonably modify and amend them as it deems
necessary. Landlord will not be responsible to Tenant for the nonperformance by
any other Tenant or occupant of the Project of any of said Rules and
Regulations.
24.02 In the event that Tenant fails to cure any
violations of such Rules and Regulations following ten (10) days written notice
by Landlord, such failure to cure shall be deemed a material breach of this
Lease by Tenant.
25. ESTOPPEL CERTIFICATE
25.01 Tenant will execute and deliver to Landlord, within
ten (10) business days of Landlords written demand, a statement in writing
certifying that this Lease is in full force and effect, and that the Base
Monthly Rent and Additional Rent payable hereunder is unmodified and in full
force and effect (or, if modified, stating the nature of such modification) and
the date to which rent and other charges are paid, if any, and acknowledging
that there are not, to Tenant's knowledge, any uncured defaults on the part of
Landlord hereunder or specifying such defaults if they are claimed and such
other matters as Landlord may reasonably request. Any such statement may be
conclusively relied upon by any prospective purchaser or encumbrancer of the
Premises. Tenant's failure to deliver such statement within such time shall be
conclusive upon Tenant that (1) this Lease is in full force and effect, without
modification except as may be represented by Landlord; (2) there are no uncured
defaults in Landlord's performance and (3) not more than one (1) month's rents
has been paid in advance.
26. SALE BY LANDLORD
26.01 In the event of a sale or conveyance by Landlord of
the Project the same shall operate to release Landlord from any liability upon
any of the covenants or conditions, expressed or implied, herein contained in
favor of Tenant, and in such event Tenant agrees to look solely to the
responsibility of the successor in interest of Landlord in and to this Lease so
long as such successor agrees to assume Landlord's obligations and liabilities
under this Lease. This Lease will not be affected by any such sale, and Tenant
agrees to attorn to the purchaser or assignee.
27. NOTICES
27.01 All notices, statements, demands, requests,
consents, approvals, authorizations, offers, agreements, appointments, or
designations under this Lease by either party to the other will be in writing
and will be considered sufficiently given and served upon the other party if
sent by certified or registered mail, return receipt requested, postage prepaid,
delivered personally, or by a national overnight delivery service and addressed
as indicated in 1.03 and 1.04.
28. WAIVER
28.01 The failure of Landlord to insist in any one or more
cases upon the strict performance of any term, covenant or condition of the
Lease will not be construed as a waiver of a subsequent breach of the same or
any other covenant, term or condition; nor shall any delay or omission by
Landlord to seek a remedy for any breach of this Lease be deemed a waiver by
Landlord of its remedies or rights with respect to such a breach.
29. HOLDOVER
29.01 If Tenant remains in the Premises after the Lease
Expiration date with the consent of the Landlord and has not given prior written
notice to Landlord, such continuance of possession by Tenant will be deemed to
be a month-to-month tenancy at the sufferance of Landlord terminable on thirty
(30) day notice at any time by either party. All provisions of this Lease,
except those pertaining to term and rent, will apply to the month-to-month
tenancy. Tenant will pay a new Base Monthly Rent in an amount equal to 125% of
the base monthly rent payable for the last full calendar month during the
regular term of this Lease.
30. DEFAULT OF LANDLORD/LIMITATION OF LIABILITY
30.01 In the event of any default by Landlord hereunder,
Tenant agrees to give notice of such default in accordance with Section 27.01 to
Landlord at Landlord's Notice Address as stated in 1.04 and to offer Landlord
reasonable opportunity to cure the default. In the event of any actual or
alleged failure, breach or default hereunder Landlord, Tenant's sole and
exclusive remedy will be against Landlord's interest in the Project, and
Landlord, its directors, officers, employees and any partner of Landlord will
not be sued, be subject to service or process, or have a judgement obtained
against him in connection with any alleged breach or default, and no writ of
execution will be levied against the assets of any partner, shareholder or
officer of Landlord. The covenants and agreements are enforced by Landlord and
also by any partner, shareholder or officer of Landlord.
-13-
31. SUBORDINATION
31.01 Without the necessity of any additional document
being executed by Tenant for the purpose of effecting a subordination, and at
the election of Landlord or any mortgagee with a lien on the Project or any
ground lessor with respect to the Project, this Lease will be subject and
subordinate at all times to (a) all ground leases or underlying leases which may
now exist or hereafter be executed affecting the Project, and (b) the lien of
any mortgage or deed of trust which may now exist or hereafter be executed in
any amount for which the Project, ground leases or underlying leases, or
Landlord's interest or estate in any of said items is specified as security. In
the event that any ground lease or underlying lease terminates for any reason or
any mortgage or deed of trust is foreclosed or a conveyance in lieu of
foreclosure is made for any reason, Tenant will, notwithstanding any
subordination, attorn to and become the Tenant of the successor in interest to
Landlord, at the option of such successor in interest. Tenant covenants and
agrees to execute and deliver to Landlord any document or instrument reasonably
requested by Landlord or its ground lessor, mortgagee or beneficiary under a
deed of trust evidencing such subordination of this Lease with respect to any
such ground lease or underlying leases or the lien of any such mortgage or deed
of trust. Tenant hereby agrees that the failure to execute and deliver any such
document to Landlord within fourteen (14) days of Landlord's request therefor
shall constitute a default by Tenant under this Lease.
32. DEPOSIT AGREEMENT
32.01 Landlord and Tenant hereby agree that Landlord will
be entitled to immediately endorse and cash Tenant's good faith rent and the
Security Deposit check(s) accompanying this Lease. It is further agreed and
understood that such action will not guarantee acceptance of this Lease by
Landlord, but, in the event Landlord does not accept this Lease, such deposits
will be promptly refunded in full to Tenant. This Lease will be effective only
after Tenant has received a copy fully executed by both Landlord and Tenant.
33. GOVERNING LAW
33.01 This Lease is governed by and construed in
accordance with the laws of the State of Nevada, and venue of any suit will be
in the county where the Premises are located unless the Premises are not located
in Nevada in which case the venue will be Washoe County in the State of Nevada.
34. NEGOTIATED TERMS
34.01 This Lease is the result of the negotiations of the
parties and has been agreed to by both Landlord and Tenant after prolonged
discussion.
35. SEVERABILITY
35.01 If any provision of this Lease is found to be
unenforceable, all other provisions shall remain in full force and effect.
36. BROKERS
36.01 Tenant warrants that it has had no dealings with any
broker or agent in connection with this Lease, except David L. Schuster with
Grubb & Ellis and covenants to pay, hold harmless and indemnify Landlord from
and against any and all cost, expense or liability for any compensation,
commissions and charges claimed by any broker or agent, other than any
identified above, with respect to this Lease or its negotiation.
37. QUIET POSSESSION
37.01 Tenant, upon paying the rentals and other payments
herein required from Tenant, and upon Tenant's performance of all of the terms,
covenants and conditions of this Lease on its part to be kept and performed, may
quietly have, hold and enjoy the Premises during the Term of this Lease
without disturbance from Landlord or from any other person claiming through
Landlord.
38. MISCELLANEOUS PROVISIONS
38.01 Whenever the singular number is used in this Lease
and when required by the context, the same will include the plural, and the
masculine gender will include the feminine and neuter genders, and the word
"person" will include corporation, firm, partnership, or association. If there
is more than one Tenant, the obligations imposed upon Tenant under this Lease
will be joint and several.
38.02 The headings or titles to paragraphs of this Lease
are not a part of this Lease and will have no effect upon the construction or
interpretation of any part of this Lease.
38.03 This instrument contains all of the agreements and
conditions made between the parties to this Lease. Tenant acknowledges that
neither Landlord nor Landlord's agents have made any representation or warranty
as to the suitability of the Premises to the conduct of Tenant's business. Any
agreements, warranties or representations not expressly contained herein will in
no way bind either Landlord or Tenant, and Landlord and Tenant expressly
waive all claims for damages by reason of any statement, representation,
warranty, promise or agreement, if any, not contained in this Lease.
38.04 Time is of the essence of each term and provision of
this Lease.
-14-
38.05 Except as otherwise expressly stated, each payment
required to be made by Tenant is in addition to and not in substitution for
other payments to be made by Tenant.
38.06 Subject to Article 18, the terms and provisions of
this Lease are binding upon and inure to the benefit of the heirs, executors,
administrators, successors and assigns of Landlord and Tenant.
38.07 All covenants and agreements to be performed by
Tenant under any of the terms of this Lease will be performed by Tenant at
Tenant's sole cost and expense and without any abatement of rent.
38.08 In consideration of Landlord's covenants and
agreements hereunder, Tenant hereby covenants and agrees not to disclose any
terms, covenants or conditions of this Lease to any other party without the
prior written consent of Landlord.
38.09 Tenant agrees it will provide to Landlord such
financial information as Landlord may reasonably request for the purpose of
obtaining construction and/or permanent financing for the Premises.
38.10 If Tenant shall request Landlord's consent and
Landlord shall fail or refuse to give such consent, Tenant shall not be entitled
to any damages for any withholding by Landlord of its consent; Tenant's sole
remedy shall be an action for specific performance or injunction, and such
remedy shall be available only in those cases where Landlord has expressly
agreed in writing not to unreasonably withhold its consent or where as a matter
of law Landlord may not unreasonably withhold its consent.
38.11 Whenever a day is appointed herein on which, or a
period of time is appointed in which, either party is required to do or complete
any act, matter or thing, the time for the doing or completion thereof shall be
extended by a period of time equal to the number of days on or during which such
party is prevented from, or is reasonably interfered with, the doing or
completion of such act, matter or thing because of labor disputes, civil
commotion, war, warlike operation, sabotage, governmental regulations or
control, fire or other casualty, inability to obtain materials, or to obtain
fuel or energy, weather or other acts of God, or other causes beyond such
party's reasonable control (financial inability excepted); provided, however,
that nothing contained herein shall excuse Tenant from the prompt payment of any
Rent or charge required of Tenant hereunder.
38.12 No slot machine or other gambling game shall be
permitted on the Premises without the prior written consent of Landlord. The
Premises shall not be used for any "adult bookstore" or "adult motion picture
theater" as said terms are defined in NRS 278.0221, or any similar use,
notwithstanding any local zoning codes or ordinances or any other provisions of
law to the contrary permitting such use.
39. CHANGE ORDERS. In the event Tenant requests and/or approves changes in the
scope the work being provided by or through Landlord Tenant agrees to pay all
the direct and indirect costs of additional work at the time it gives such
approval. In the event that the aggregate cost of additional work provided under
this Lease is ten thousand dollars ($10,000.00) or more, or in excess of two
months rent, whichever is less, then Landlord may accept payment of one half of
the cost of additional work at the time of approval of said change order by the
Tenant, and payment of the balance to be paid at the time the additional work is
substantially completed.
40. SPECIAL PROVISIONS
40.01 Special provisions of this Lease number 41 and
Exhibits "A", "B", "C", "D", "F, "G" and "H" are attached hereto and made a part
hereof. If none, so state in the following space:.
41. OPTIONS TO EXTEND LEASE TERM
41.01 Tenant is hereby granted two (2) options (each, an
"Extension Option," and collectively, the "Extension Options,") to extend the
Lease Term for an additional term of five (5) years (each, an "Extension Term"
and collectively, the "Extension Terms") each beginning on the day after
expiration of the Initial Lease Term or the first Extension Term, as the case
may be, and expiring on the date five (5) years thereafter (unless terminated
sooner pursuant to any other terms or provisions of the Lease), on all of the
same terms and conditions as set forth in the Lease, but at an adjusted Base
Monthly Rent as set forth in Section 41.02 below (and without any additional
option to extend the Lease Term after the expiration of the second Extension
Term). The Extension Options may be exercised by Tenant only by delivery of
written notice of such exercise (the "Extension Notice") to Landlord, which
Extension Notice must be received by Landlord at least one hundred eighty (180)
days before the expiration of the Initial Lease Term, or the first extension
Term, as applicable. If Tenant fails to timely deliver the Extension Notice, or
if this Lease is terminated pursuant to any of its other terms or provisions
prior to the expiration of the Initial Lease Term or the first Extension Term,
as the case may be, all remaining Extension Options shall lapse, and Tenant
shall have no right to extend or further extend the Lease Term. Each Extension
Option shall be exercisable by Tenant on the express conditions that (i) at the
time of delivery of Tenant's Extension Notice and at all times thereafter and
prior to the commencement of the applicable Extension Term, Tenant shall not be
in default under this Lease, (ii) Tenant has not previously been in default
(whether or not such default has been timely cured) under this Lease on more
than three (3) occasions during the Lease Term, and (iii) Tenant has exercised
the concurrent "Extension Option" as defined in and provided under the Adjacent
Premises Lease. After exercise of each Extension Option by Tenant in accordance
with the foregoing provisions, Tenant's obligation to renew shall be irrevocable
by Tenant.
41.02 Base Monthly Rent during each thirty (30) month
period of each Extension Term shall be completed as follows. As used herein, the
term, "Extension Adjustment Month," shall mean the first (1st) and thirty-first
(31st) months of each Extension Term, the term, "Extension Comparison Index,"
shall mean the Index published and which is in effect the third month preceding
the commencement of the applicable Extension Adjustment Month, and the term,
"Beginning Index," shall mean the Index published which is in effect during the
fifty-seventh (57th) month of the Initial Lease Term.
-15-
Base Monthly Rent for each thirty (30) month period during each Extension Term
shall be the product of the Base Monthly Rent as specified in Section 1.07
above (for months 61-84 of the Initial Lease Term) multiplied by a fraction,
the numerator being the applicable Extension Comparison Index and the
denominator being the Beginning Index. In no event, however, shall the Base
Monthly Rent during any period of any Extension Term be less than the Base
Monthly Rent due during the immediately preceding period of the Lease Term.
Landlord will give Tenant notice of each increase by written invoice; however,
failure of Landlord to give such notice shall not be construed as a waiver of
the increase and any such increased amount shall accrue as rent. If after this
Lease is executed, the Index is discontinued or revised during the Extension
Term, Landlord reserved the right to use a conversion factor, formula or table
as may be published by the Bureau of Labor Statistics or a different Index in
order to obtain substantially the same result.
IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease as of
the day and year indicated by Landlord's execution date as written below.
Individuals signing on behalf of a Tenant warrant that they have the
authority to bind their principals. In the event that Tenant is a corporation,
Tenant shall deliver to Landlord, concurrently with the execution and delivery
of this Lease, a certified copy of corporate resolutions adopted by Tenant
authorizing said corporation to enter into and perform the Lease and
authorizing the execution and delivery of the Lease on behalf of the
corporation by the parties executing and delivering this Lease. THIS LEASE,
WHETHER OR NOT EXECUTED BY TENANT, IS SUBJECT TO ACCEPTANCE AND EXECUTION BY
LANDLORD, ACTING ITSELF OR BY ITS AGENT ACTING THROUGH ITS PRESIDENT, VICE
PRESIDENT, OR ITS DIRECTOR OF LEASING AND MARKETING.
Landlord: Dermody Industrial Group, a Nevada Joint Venture Tenant: UDS, a Nevada Corporation DBA: UDS
------------------------------------------------ --------------------------------------------
By: DP Operating Partnership, L.P., a Delaware
------------------------------------------------
Limited Partnership, its Managing Venturer
------------------------------------------------
BY: Dermody Properties, a Nevada Corporation
--------------------------------------------
its General Partner
--------------------------------------------
By: /s/
---------------------------------------------- ----------------------------------------------
Michael C. Dermody
Its: President
Its: President ----------------------------------------------
----------------------------------------------
Date: 9/22/00
Date: ----------------------------------------------
---------------------------------------------- (Execution date)
(Execution date)
-16-
EXHIBIT A
PREMISES
[GRAPHIC OMITTED]
Exhibit "A" to lease dated March 23,2000 by and between Dermody Industrial
Group, a Nevada Joint Venture By: DP Operating Partnership, L.P., a Delaware
limited partnership, its Managing Venturer; By: Dermody Properties, a Nevada
Corporation, its General Partner, and UDS, a Nevada Corporation DBA: UDS.
- ----------------------------------------
Dermody Industrial Group
/s/
- ----------------------------------------
UDS
Exhibit B
Landlord's Work
Improvements to Premises:
1. All heating, ventilating and air-conditioning units are to be in good
operating condition at the time tenant takes possession of the
premises.
2. Landlord to seal the parking area per Landlord's standard maintenance
schedule.
3. Landlord to replace existing lighting in the warehouse with metal
halide lighting.
4. Landlord to remove two of the existing blocked forklift openings on the
demising wall.
5. All docks and dock equipment to be in good operating condition upon
possession of the premises.
Exhibit "B" to lease dated March 23,2000 by and
between Dermody Industrial Group, a Nevada Joint
Venture By: DP Operating Partnership, L.P., a
Delaware limited partnership, its Managing Venturer;
By: Dermody Properties, a Nevada Corporation, its
General Partner, and UDS, a Nevada Corporation DBA:
UDS.
- ----------------------------------------
Dermody Industrial Group
/s/
- ----------------------------------------
UDS
Exhibit C
(Tenant Questionnaire)
TENANT QUESTIONNAIRE REGARDING USE OF
PREMISES AT 4910 LONGLEY LANE, SUITE 102, RENO, NEVADA
Yes No
1. Will any manufacturing process be done on the subject premises? [ ] [ ]
2. Do you or your company intend to use any internal combustion
engines greater than 50 hp at the subject premises? [ ] [ ]
3. Do you or your company intend to use processes that involve
mixing, blending, or processing any solvents, adhesives, paints
or coatings? [ ] [ ]
4. Will your operation at the premises create any dusts or smoke? [ ] [ ]
5. At the subject premises, will you or your company refine any
liquids or solids? Reclaim any metals? [ ] [ ]
6. Will you or your company plate or coat anything at the subject
premises? [ ] [ ]
7. Will any process be used on the Premises which requires equipment
for the heating of materials (i.e., boilers, furnaces, broilers,
baking ovens, etc.)? [ ] [:]
8. Will you handle or store solvents or motor fuels on the premises? [ ] [ ]
9. Will you use or store any acids at the premises? [ ] [ ]
10. Will you or your company use any chemical processes at the premises? [ ] [ ]
11. Will you or your company use any solvents for clean up? [ ] [ ]
12. Is your business a dry cleaner, restaurant, body shop, gasoline
station, printer or part coater? [ ] [ ]
13. Will you or your company use any process which requires lead or
melting or soldering with lead or lead alloys? [ ] [ ]
14. Do you or your company has a Hazardous Materials Management plan? [ ] [ ]
If you have marked "Yes" to any of the questions as to processes, chemicals,
including types and quantities, to be used on the Premises, please give a more
detailed explanation below and on a second page if necessary.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Name of person completing form:
-------------------------------------------------
Company name and address:
-------------------------------------------------------
- --------------------------------------------------------------------------------
Exhibit "C" to lease dated March 23, 2000 by and
between Dermody Industrial Group, a Nevada Joint
Venture By: DP Operating Partnership, L.P., a
Delaware limited partnership, its Managing Venturer;
By: Dermody Properties, a Nevada Corporation, its
General Partner, and UDS, a Nevada Corporation DBA:
UDS.
- --------------------------------------
Dermody Industrial Group
/s/
- --------------------------------------
UDS
EXHIBIT "D"
RULES AND REGULATIONS
It is further agreed that the following rules and regulations shall be and are
hereby made a part of this Lease, and the Tenant agrees that its employees and
agents, or any others permitted by the Tenant to occupy or enter said Premises,
will at all times abide by said rules and regulations and that a default in the
performance and observance thereof shall operate the same as any other defaults
herein:
1. The sidewalks, entries, and driveways shall not be obstructed by the
Tenant, or its agents, or used by them for any purpose other than
ingress and egress to and from their Premises. Landlord may remove any
such obstruction or thing (unauthorized by Landlord) without notice or
obligation to Tenant.
2. Tenant shall not place any movable objects, including antennas, outdoor
furniture, etc., in the parking areas, landscaped area or other areas
outside of said Premises, or on the roof of said Premises.
3. No person shall disturb the occupants of this or adjoining Buildings or
Premises by the use of any radio or musical instrument or by the making
of loud or improper noises.
4. Parking any type of recreational vehicles is specifically prohibited.
No vehicle of any type shall be stored in the parking areas at any
time. In the event that a vehicle is disabled, it shall be removed
within 48 hours. There shall be no "For Sale" or other advertising
signs on or about any parked vehicle. All vehicles shall be parked in
the designated parking areas in conformation with all signs and other
markings.
5. Lessee shall not use, keep or permit to be used or to be kept any foul
or noxious gas or substance in the Premises, or permit or suffer the
Premises to be occupied or used in a manner offensive or objectionable
to Lessor or other occupants of the Building by reason of noise, odors
and/or vibrations, or interfere in any way with other Lessees or those
having business therein. Lessee shall maintain the leased Premises free
from mice, bugs, and ants attracted by food, water or storage
materials.
6. Lessor reserves the right to exclude or expel from the complex any
person who in the judgment of the Lessor, is intoxicated or under the
influence of liquor or drugs or who shall in any manner do any act in
violation of the Rules and Regulations of the said project.
7. Lessee shall give Lessor prompt notice of any defects in the water,
lawn sprinkler, sewage, gas pipes, electrical lights and fixtures,
heating apparatus, or any other service equipment or any dangerous or
hazardous condition existing on the property.
8. No outside storage of pallets, boxes, cartons, drums or any other
containers or materials used in shipping or transport of goods is
allowed. Tenant shall place all refuse in proper receptacles provided
by Tenant at Tenant's expense on the Premises or inside enclosures (if
any) provided by Landlord for the Building, and shall keep sidewalks
and driveways outside the Building and lobbies, corridor stairwells,
ducts or shafts of the Building free of all refuse.
9. All moveable trash receptacles provided by the trash disposal firm must
be kept in the trash enclosure areas where provided for that purpose.
RULES AND REGULATIONS
Page 2.
10. The Landlord reserves the right to make such other and further
reasonable rules and regulations as in its judgment may from time to
time be needful and desirable for the safety, care and cleanliness of
the Premises and for the preservation of good order therein.
11. Lessee shall not use any method of heating or air conditioning other
than that supplied by Lessor without the consent of Lessor.
12. No person shall go on the roof without Lessor's permission.
13. All goods, including material used to store goods, delivered to the
Premises of Lessee shall be immediately moved into the Premises and
shall not be left in parking or receiving areas overnight.
14. Tenants shall not do or permit anything to be done in their Premises or
bring or keep anything therein which will in any way obstruct or
interfere with the rights of other Tenants, or do, or permit anything
to be done in their Premises which shall, in the judgement of the
Landlord or its manager, in any way injure or annoy them, or conflict
with the laws relating to fire, or with the regulations of the fire
department or with any insurance policy upon the Building or any part
thereof or any contents therein or conflict with any of the of the
Rules and Ordinances of the public Building or health authorities.
15. All electrical equipment used by Tenants shall be U.L. approved.
Nothing shall be done or permitted in Tenant's Premises, and nothing
shall be brought into or kept in the Premises which would impair or
interfere with any of the Building services or the proper and economic
heating, cooling, cleaning or other servicing of the Building or the
Premises. Tenant's computers and other equipment are hereby expressly
allowed.
16. Tenants shall not install or operate any steam or gas engine or boiler,
or carry on any mechanical business in the Building. The use of oil,
gas or inflammable liquids for heating, lighting or any other purpose
is expressly prohibited. Explosives or other articles deemed extra
hazardous shall not be brought into the Building. Tenants shall not use
any other method of heating than that supplied by Landlord.
17. Tenants shall not remove any carpet, or wall coverings, window blinds,
or window draperies in their Premises without the prior written
approval from Landlord.
18. No animals, birds or pets (other than seeing-eye dogs) of any kind
shall be allowed in Tenant's Premises or Building.
19. The water closets, urinals, waste lines, vents or flues of the Building
shall not be used for any purpose other than those for which they were
constructed, and no rubbish, acids, vapors, newspapers or other such
substances of any kind shall be thrown into them. The expense caused by
any breakage, stoppage or damage resulting from a violation of this
rule by any Tenant, its employees, visitors, guests or licensees, shall
be paid by Tenant.
RULES AND REGULATIONS
Page 3.
20. All decorating, carpentry work, or any labor required for the
installation of Tenant's (a) equipment, such as an alarm system,
computer, telephone/telegraph equipment, lines, cables or other
electrical devices; or (b) furnishings or other property shall be
performed at Tenants expense, and will not require Landlord's prior
verbal or written approval. Should any such work require alterations
that affect the heating, ventilation, air conditioning, plumbing,
electrical or mechanical systems of the Building, the roof, or the
structure of the Building, Landlord's prior written approval will be
required. Structural changes are defined as changes that affect a vital
and substantial portion of the Premises, changing its characteristic
appearance, fundamental purpose of its erection or uses, or a change of
such a nature as to affect the very realty itself, extraordinary in
scope and effect, or unusual in expenditure.
21. The Premises shall not be used or permitted to be used for residential,
lodging or sleeping purposes.
22. Except as permitted by landlord, Tenant shall not mark upon, paint
signs upon, cut, drill into, drive nails or screws into, or in any way
deface the walls, ceilings, partitions or floors of their Premises or
of the Building, and the repair cost of any defacement, damage, or
injury caused by Tenant, its agents or employees shall be paid for by
the Tenant.
23. The cost of repairing any damage to the public partitions of the
Building or the public facilities, or to any facilities used in common
with other tenants, caused by any Tenant or the employees, licensees,
agents or invitees of the Tenant, shall be paid by such Tenant.
24. Landlord reserves the right to restrict or prohibit canvassing,
soliciting or peddling in the Building.
Exhibit "D" to lease dated March 23, 2000 by and
between Dermody Industrial Group, a Nevada Joint
Venture By: DP Operating Partnership, L.P., a
Delaware limited partnership, its Managing Venturer;
By: Dermody Properties, a Nevada Corporation, its
General Partner, and UDS, a Nevada Corporation DBA:
UDS.
- --------------------------------------------
Dermody Industrial Group
/s/
- --------------------------------------------
UDS
EXHIBIT "F"
SIGN CRITERIA
SECTION I: PURPOSE AND INTENT
The purpose of Dermody Properties planned sign program is to provide
minimum standards to safeguard life, health, property and the public
welfare and to provide the means for adequate identification and
advertisement of both the existing and future business by regulating
and controlling the design, location, and maintenance of all signs.
The intent of this program is to assure compatibility of proposed signs
with existing signs by providing tenants with individual identification
while maintaining overall consistency. All existing and proposed signs
must comply with the standards set forth in this planned sign program
and applicable City codes.
SECTION II: GENERAL SIGN REQUIREMENTS
1. Compliance Required
No person shall erect, re-erect, construct, enlarge, alter,
repair, move, improve, remove, convert, or equip any sign or
sign structure, or paint a new wall sign or cause or permit
the same to be done, contrary to or in violation of any of the
provisions of this planned sign program. Conformance will be
strictly enforced and any installed non-conforming or
unapproved signs must be brought into conformance at the
expense of the tenant.
2. Sign Content
All signs shall be limited to tenant's trade name and/or logo
or logo-type. Wording of signs shall not include the product
sold except as part of the tenant's trade name or logo.
Registered trademarks may be allowed subject to approval by
landlord.
3. Administration
a. Each tenant shall submit or cause to be submitted to
the Landlord for approval prior to fabrication at
least 3 copies of detailed sign drawings covering the
location, size, layout mounting method, design,
color, and materials of the proposed sign or signs.
b. After the Landlord has approved the sign drawings,
tenant shall submit the plans to the City for
approval. If any changes are made in the Landlord
approved plans by the Planning Department tenant
shall re-submit revised plans to the Landlord for
review and approval prior to fabrication and
installation.
c. All permits and fees for signs and their installation
shall be obtained and paid for by the tenant or his
representative.
d. Tenant shall be fully responsible for their sign and
choice of sign contractor. Tenant sign contractor
shall be licensed to work in the State of Nevada and
the appropriate local jurisdiction and shall carry
workers compensation and public liability insurance
in the amount of $500,000.00 per occurrence against
all damage suffered or done to any person and/or
property while engaged in the construction or
erection of signs.
e. Tenant shall be responsible for the fulfillment of
all requirements and specifications of this document
and any appropriate City Code.
f. All submittals should be addressed to your leasing
agent:
Dermody Properties
Post Office Box 7098
Reno, Nevada 89510
4. Prohibited Signs
The following signs shall not be permitted:
a. Signs which incorporate in any manner any flashing,
moving or intermittent lighting or ??? emit noise;
b. Signs which by color, wording, design, location, or
illumination resemble or conflict with any traffic
control device or with safe and efficient flow of
traffic;
Sign Criteria
Page 2.
c. Signs that create a safety hazard by obstructing
clear view of pedestrian and vehicular traffic;
d. Flags, banners and pennants when used for advertising
purposes. National or state flags displayed in an
appropriate manner shall not be prohibited;
e. Signs projecting into the public right-of-way;
f. Any proposed sign that would adversely affect
conforming residential development or conforming
tenant signing.
g. Portable signs;
h. Signs which project above a parapet or the highest
point of a roof.
5. Proper Maintenance Required
All signs, together with all of their supports, braces, guys
and anchors, shall be properly maintained with respect to
appearance, structural and electrical features. The display
surfaces of all signs shall be kept neatly painted or posted
at all times. All signs shall be subject to maintenance
provisions as follows:
a. All signs shall be refinished to remove rust or other
corrosion due to the elements and any cracked or
broken faces and malfunctioning lamps shall be
replaced within thirty (30) days following
notification by Landlord.
b. Any location where business goods are no longer sold
or produced or where services are no longer provided
shall have thirty (30) days following move out to
remove any remaining or derelict signs or copy
therein and restore the mounting surface to a good
and satisfactory condition.
Exhibit "F" to lease dated March 23, 2000 by and between
Dermody Industrial Group, a Nevada Joint Venture By:
DP Operating Partnership, L.P., a Delaware limited
partnership, its Managing Venturer; By: Dermody
Properties, a Nevada Corporation, its General
Partner, and UDS, a Nevada Corporation DBA: UDS.
- -------------------------------------------
Dermody Industrial Group
/s/
- -------------------------------------------
UDS
EXHIBIT "G"
MOVE OUT STANDARDS
THIS Move Out Standards (Exhibit "G") is dated for the reference purposes as
March 23, 2000, and is made between DP Operating Partnership, L.P., a Delaware
limited partnership, ("Landlord"), and UDS, a Nevada corporation DBA: UDS,
("Tenant") to be a part of that certain Standard Industrial Lease (Dermody
Properties Standard Industrial Lease Net-Net-Net form) of even date herewith
between Landlord and Tenant (the "Lease") concerning a portion of the Property
more commonly known as 4910 Longley Lane, Suite 102, Reno, Nevada (the
"Premises"). Landlord and Tenant agree that the Lease is hereby modified and
supplemented as follows:
At the expiration of this Lease, Tenant shall surrender the Premises in the same
condition as they were upon delivery of possession thereto under this Lease,
reasonable wear and tear excepted, and shall deliver all keys to Landlord.
Before surrendering the Premises, Tenant shall remove all of its Personal
Property and trade fixtures and such alterations or additions to the Premises
made by Tenant as may be specified for removal thereof. If Tenant fails to
remove its personal property and fixtures upon the expiration of this Lease, the
same shall be deemed abandoned and shall become the property of the Landlord.
The Tenant shall surrender the Premises, at the time of the expiration of the
Lease, in a condition that shall include, but is not limited to, addressing the
following items:
1. Lights: Office and warehouse light will be fully operational
with all bulbs functioning.
2. Dock Levelers & Roll Up Doors: Should be in good working condition.
3. Dock Seals: Free of tears and broken backboards repaired.
4. Warehouse Floor: Free of stains and swept with no racking bolts and
other protrusions left in floor. Cracks should be
repaired with an epoxy or polymer.
5. Tenant-Installed Equipment & Wiring: Removed and space turned to original condition when
originally leased. (Remove air lines, junction boxes,
conduit, etc.)
6. Walls: Sheetrock (drywall) damage should be patched and
fire-taped so that there are no holes in either
office or warehouse.
7. Roof: Any tenant-installed equipment must be removed and
roof penetrations properly repaired by licensed
roofing contractor. Active leaks must be fixed and
latest landlord semi-annual maintenance and repairs
recommendation must have been followed.
8. Signs: All exterior signs must be removed and holes patched
and paint touched-up as necessary. All window signs
should likewise be removed.
9. Heating & Air Conditioning System: A written report from a licensed HVAC contractor
within the last three months stating that all
evaporative coolers within the warehouse are
operational and safe and that office HVAC system is
also in good and safe operating condition.
10. Overall Cleanliness: Clean windows, sanitize bathroom(s), vacuum carpet,
and remove any and all debris from office and
warehouse. Remove all pallets and debris from
exterior of premises.
11. Upon Completion: Contact Dermody Properties (775) 858-8080 to
coordinate date of turning off power, turning in
keys, and obtaining final Dermody Properties
inspection of premises which, in turn, will
facilitate refund of security deposit.
Exhibit "G" to lease dated March 23, 2000 by and
between Dermody Industrial Group, a Nevada Joint
Venture By: DP Operating Partnership, L.P., a
Delaware limited partnership, its Managing Venturer;
By: Dermody Properties, a Nevada Corporation, its
General Partner, and UDS, a Nevada Corporation DBA:
UDS.
- -----------------------------------------------
Demody Industrial Group
/s/
- -----------------------------------------------
UDS
EXHIBIT "H"
GUARANTY
(Lease)
This Guaranty is entered into by Patrick West and Laura West, husband
and wife, jointly and severally (collectively, "Guarantor"), for the benefit of
Dermody Industrial Group, a Nevada joint venture ("Landlord"), with reference to
the following facts:
A. UDS, a Nevada corporation ("Tenant"), desires to lease from
Landlord certain premises located at 4910 Longley Lane, Suite 102, Reno, Nevada.
B. Guarantor desires and requests that Landlord lease such
property to Tenant as Tenant requests and in consideration thereof Guarantor
hereby guarantees and agrees as follows:
1. Guarantor hereby unconditionally guarantees the prompt
payment, discharge and performance of all the obligations, duties, liabilities,
and undertakings of Tenant under any note, application, financial statement, or
other instrument executed by Tenant or entered into between Tenant and Landlord
(including, without limiting the foregoing, the Lease between Landlord and
Tenant of even date (the "Lease"), together with the full payment of any and all
sums of money which are now or may hereafter become due by Tenant to Landlord,
whether by acceleration or otherwise. (Such obligations, duties, liabilities,
undertakings and indebtedness of Tenant to Landlord are hereafter referred to as
the "Obligations"). Capitalized terms not otherwise defined in this Guaranty
shall have the meaning ascribed to them in the Lease. Without limiting the
foregoing, Tenant's Obligations shall include those under the Extension Term(s),
as such term is defined in this Lease.
2. Landlord may in its absolute discretion and without prejudice
to or in any way limiting or lessening the liability of Guarantor under this
Guaranty, and without further authorization from or notice to Guarantor (even
though Tenant's financial condition may have deteriorated since the date
hereof), enter into such leases and other agreements with Tenant as Landlord, in
its sole discretion, may elect, including renewals, modifications, or extensions
of any Obligations and any instrument or agreement evidencing any Obligations;
grant extensions of time or other indulgences; take or give up or modify, vary,
exchange, renew or abstain from performing or taking advantage of any security;
accept or make compositions, or other arrangements; discharge or release any
party or parties; realize on any security and otherwise deal with Tenant and
other parties, any security; or any leased property as Landlord may deem
expedient. Guarantor hereby consents to and waives notice of any substitution,
elimination or addition of any lease properly and no such event or the
amendment, modification, renewal or termination of any lease or any instrument
or agreement evidencing any Obligation shall release or discharge Guarantor from
its Obligations hereunder. Guarantor waives any defenses arising out of
disability or other defenses of Tenant, by reason of cessation or for any reason
whatsoever of the liability of Tenant.
3. This is a continuing Guaranty and covers all Obligations of
Tenant, whether now existing or hereafter arising, and where more than one
Tenant, the several Obligations of each as well as their joint Obligations,
including those incurred or to be incurred by Tenant under a commitment issued
by Landlord up to such time as Landlord shall have received notice in writing by
Guarantor at Landlord's address set forth in the Lease of even date herewith, to
make no further agreement on the security of this Guarantee. In giving this
Guarantee, Guarantor expressly excuses Landlord from any requirement of
disclosure by Landlord of any information it may now have or hereafter acquire
concerning Tenant's credit, collateral, character or financial condition.
4. This Guaranty covers any Obligations due or owing from time to
time and at any time from Tenant to Landlord, and no payments made by or on
behalf of Guarantor to
Landlord shall be held to discharge or diminish the continuing liability of
Guarantor hereunder.
5. All debts and liabilities, present and future of Tenant to
Guarantor, or any of them, are hereby postponed to the Obligations of Tenant to
Landlord, and all moneys received by Guarantor or its representatives,
successors or assigns, shall be received as trustee for Landlord and shall be
paid over to Landlord, and Guarantor further agrees, upon any liquidation or
distribution of the assets of Tenant, to assign to Landlord upon its request ail
claims on account of all such debts and liabilities, to the end that Landlord
shall receive all dividends and payments on such debts and liabilities until
payment in full of all Obligations of Tenant to Landlord. This Guaranty shall
constitute such assignment in the event Guarantor shall fail or refuse to
execute and deliver such other or further assignment of such claims as Landlord
may request.
6. Guarantor's Obligations under this Guaranty are joint and
several and are independent of Tenant's Obligations. A separate action may be
brought against any other guarantors, Tenant, or all, regardless of whether any
other guarantor, Tenant, or all are joined in such action.
7. This Guaranty shall not be affected by Landlord's failure or
delay to enforce any of its rights. If Tenant defaults under the Lease, Landlord
can proceed immediately against Guarantor, Tenant, or all, any rights it has
under the Lease, or pursuant to applicable law. Guarantor hereby irrevocably
waives the right to require Landlord to (i) proceed against the Tenant, (ii)
proceed against or exhaust any security that Landlord holds from Tenant, or
(iii) pursue any other remedy in Landlord's power. Guarantor further irrevocably
waives any defense by reason of the disability of Tenant and any other defense
based on the termination of Tenant's liability from any cause.
8. Guarantor waives the right to participate in any security now
or hereafter held by Landlord. Guarantor waives all presentments, demands for
performance, notices of default of Tenant under the Obligations, notices of
nonperformance, notices of protest and dishonor, and notice of acceptance of
this Guaranty and notice of the existence, creation, or incurring of new or
additional obligations.
9. The liability of Guarantor hereunder shall not be affected by
(i) the release or discharge of Tenant in any receivership, bankruptcy, or other
proceeding, (ii) the impairment, limitation, or modification of the liability of
Tenant or the estate of Tenant in bankruptcy, or of any remedy for the
enforcement of Tenant's liability under this Lease resulting from the operation
of any present or future provision of any federal or state bankruptcy or
insolvency law or other statute or from the decision of any court, (iii) the
rejection or disaffirmance of the Lease in any such proceedings, (iv) the
assignment or other Transfer of the Lease by Landlord, (v) the Transfer,
including, without limitation, a Permitted Transfer, by Tenant, (vi) any
disability or other defense by Tenant, (vii) the cessation from any cause
whatsoever of the liability of Tenant, (viii) the exercise by Landlord of any of
its rights or remedies reserved under the Lease or by law, or (ix) the
termination of the Lease.
10. No assignment, sublease or other Transfer, or Permitted
Assignment of Tenant's interest in the Premises or Lease or any portion thereof
shall affect, terminate, or release Guarantor's obligations under this Guaranty
unless expressly agreed in writing by Landlord.
11. Guarantor hereby covenants and agrees to deliver such
financial statements and estoppel and other certificates and documentation as
may be requested by Landlord and its successors for purposes of the sale,
financing, refinancing of the Lease, or the Premises or Project.
12. Where Tenant is a corporation, partnership, limited liability
company, or other entity or association or a receiver, trust or other fiduciary,
Landlord is not to be concerned to see or inquire into the powers of Tenant or
its directors, officers, partners, members,
managers, associates or other agents acting or purporting to act on its behalf,
Guarantor hereby representing that such powers exist, and agreements entered
into with Landlord in the professed exercise of such powers shall be deemed to
form part of the obligations guaranteed, even though the incurring of such
obligations be in excess of the powers of Tenant or of the directors, partners,
officers, members, managers, associates or other agents thereof, or shall be in
any way irregular or defective or informal.
13. Guarantor agrees to pay all reasonable attorneys' fees, costs
and expenses which may be incurred by Landlord in the enforcement of this
Guaranty or any of the Obligations of Tenant or of Guarantor where Landlord
prevails.
14. This Guaranty shall inure to the benefit of Landlord, its
successors and assigns and shall bind the heirs, administrators, executors,
successors and assigns of Guarantor, and shall be construed as the joint and
several obligations of Guarantor where there is more than one.
15. This Guaranty shall be construed in accordance with the laws
of the State of Nevada. This Guaranty and all of the rights and obligations
hereunder shall be governed by and construed in accordance with the laws of the
State of Nevada in effect from time to time. The parties hereby agree that all
litigation resulting under this Guaranty shall be under the sole and exclusive
jurisdiction of the Second Judicial District Court in and for the County of
Washoe, State of Nevada, and the parties hereby submit to exclusive
jurisdiction, service of process, and venue thereunder.
16. This Guaranty is in addition to and not exclusive of the
guarantee of any other guarantor and of any and all prior guarantees by any
Guarantor of obligations of Tenant to Landlord.
17. This writing is intended by Guarantor as a final, complete and
exclusive expression of Guarantor's agreement. No course of dealings, course of
performance, or trade usage, and no parole evidence of any nature, shall be used
to supplement or modify any terms. There is no condition to the effectiveness of
this Guaranty.
18. Guarantor hereby jointly and severally represent and warrant
to Landlord that Guarantor is aware of and has read the Lease and understand
that their obligations as the Guarantor of the Lease may subject their assets to
liability.
19. Each individual executing this Guaranty on behalf of Guarantor
individually represents and warrants to Landlord (i) that he or she has the full
power and authority to legally bind Guarantor to the terms hereof, and (ii) this
Guaranty has been duly authorized by all necessary corporate or other action by
Guarantor.
20. Landlord acknowledges and agrees that, at such time as (1) a
Permitted Transfer occurs and (2) Guarantor provides (A) a substitute guaranty
from such persons and/or entities other than the transferee or any of its owners
or owners thereof with a combined net worth of not less than Seven Million, Five
Hundred Thousand Dollars ($7,500,000) in a form acceptable to Landlord in
Landlord's sole and absolute discretion (the "Substitute Guaranty"), or (B) an
irrevocable letter of credit in an amount not less than the then remaining total
unpaid balance of Base Monthly Rent and Additional Rent due under the Lease for
the remaining Lease Term (including any unexercised Extension Terms(s))
complying with the following requirements (the "Letter of Credit") and provided
that there does not then exist any uncured default under the Lease, Landlord
shall execute a release of Guarantor's Obligations hereunder. The Letter of
Credit shall (i) be in the amount specified in the immediately preceding
sentence, (ii) state that Landlord is the sole beneficiary and that it can be
drawn at any time to cure an uncured financial default or otherwise to
compensate Landlord for any loss or damage suffered by any uncured default by
Tenant, without approval or other interference from Tenant or any other party,
(iii) have an expiration date not earlier than ninety (90) days after the Lease
expiration date (including any unexercised Extension Option(s)), (iv) be
nominated "irrevocable," (v) provide the place for presentation is Reno, Nevada,
(vi) be transferrable by Landlord, and
(vii) include such other terms as are approved by Landlord in Landlord's
reasonable discretion. Until such time as Guarantor provides either the
Substitute Guaranty or the Letter of Credit and Landlord executes a written
release of Guarantor, and Landlord executes a written release of Guarantor's
Obligations, Guarantor's Obligations under this Guaranty shall not be affected.
Within ten (10) days of receipt of the Substitute Guaranty or Letter of Credit,
Landlord agrees to execute a written release of Guarantor's Obligations
hereunder.
Dated:_____________________, 200___ ----------------------------------
Patrick West
Dated:_____________________, 200___ ----------------------------------
Laura West
Witnessed By:
- -----------------------------------
Agreed to and Accepted:
Landlord: Dermody Industrial Group, a
Nevada Joint Venture
By: DP Operating Partnership, L.P., a
Delaware Limited Partnership, its
Managing Venturer
By: Dermody Properties, a Nevada
Corporation, its General Partner
Dated:_____________________, 200___ By:-------------------------------
Its:------------------------------
Exhibit "H" to lease dated March 23, 2000 by and
between Dermody Industrial Group, a Nevada Joint
Venture By: DP Operating Partnership, L.P., a
Delaware limited partnership, its Managing Venturer;
By: Dermody Properties, a Nevada Corporation, its
General Partner, and UDS, a Nevada Corporation DBA:
UDS.
- ------------------------------------
Dermody Industrial Group
- ------------------------------------
UDS