EXHIBIT 10.4
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INDUSTRIAL GROSS LEASE
1. Parties. This lease, dated for reference purposes only, December 07,
2000 is made by and between CARLETON INVESTORS, L.L.C. (herein called "Lessor")
and SCANNER TECHNOLOGIES CORPORATION, A MINNESOTA CORPORATION, (herein called
"Lessee").
2. Premises. Lessor hereby leases to Lessee and Lessee leases from Lessor
for the term, at the rental, and upon all of the conditions set forth herein,
that certain real property situated in the County of Maricopa, State of Arizona;
commonly known as: CARLETON BUSINESS PARK II
and described as: 4665 SOUTH ASH
SUITE(S); G-20
TEMPE ARIZONA
Said real property including the land and all improvements thereon, is herein
called "the Premises." Lessee's pro rata share of the complex is 3.481%.
3. Term. 3.1 Term. The term of this lease shall be for THIRTY SIX AND ONE
HALF (36.5) MONTHS commencing on January 15, 2001 and ending on January 31, 2004
unless sooner terminated pursuant to any provision hereof.
3.2 Delay in Commencement. Notwithstanding said commencement date, if
for any reason Lessor cannot deliver possession of the Premises to Lessee on
said date, Lessor shall not be subject to any liability therefor, nor shall such
failure affect the validity of this Lease or the obligation of Lessee hereunder
or extend the term hereof, but in such case Lessee shall not be obligated to pay
rent until possession of the Premises is tendered to Lessee provided, however,
that if Lessor shall not have delivered possession of the Premises within Sixty
(60) days from said commencement date, Lessee may, at Lessee's option, by notice
in writing to Lessor within Ten (10) days thereafter, cancel this lease, in
which event the parties shall be discharged from all obligations hereunder. If
Lessee occupies the Premises prior to said commencement date, such occupancy
shall be subject to all provisions hereof, such occupancy shall not advance the
termination date, and Lessee shall pay rent for such period at the initial
monthly rates set forth below.
3.3 Lessee's Share of Operating Expenses or Reimbursements:
3.481%.
4. Rent. Lessee shall pay to Lessor as rent for the Premises equal monthly
payments of $2,104.20 plus applicable rental taxes in advance, on the first day
of each month of the term hereof. Lessee shall pay Lessor upon the execution
hereof $2,152.60 as rent for January 2001 including the 2.30% rental taxes due
to city and state agencies. Rent for any period during the term hereof which is
for less than one month shall be a pro rata portion of the monthly installment.
Rent shall be payable in lawful money of the United States to Lessor at the
address stated herein or to such other persons or at such other places as Lessor
may designate in writing. Any checks returned as "insufficient", Lessee shall be
charged a fee of $25.00 per occurrence.
Any three checks returned as "insufficient" in any given twelve month period,
Lessee shall be subject to a "cash only" status.
5. Security Deposit. Lessee shall deposit with Lessor upon execution
hereof $4,442.00 as security for Lessee's faithful performance of Lessee's
obligations hereunder. If Lessee fails to pay rent, rental taxes, late charges,
or any other charges due hereunder, or otherwise defaults with respect to any
provision of this Lease, Lessor may use, apply or retain all or any portion of
said deposit for the payment of any rent or other charges in default or for the
payment of any other sum to which Lessor may become obligated by reason of
Lessee's default, or to compensate Lessor for any loss or damage which Lessor
may suffer thereby. If Lessor so uses or applies all or any portion of said
deposit, Lessee shall within ten (10) days after written demand therefor deposit
cash with Lessor in an amount sufficient to restore said deposit to the full
amount hereinabove stated and Lessee's failure to do so shall be material breach
of this Lease. Lessor shall not be required to keep said deposit separate from
its general accounts. If Lessee performs all of Lessee's obligations hereunder,
said deposit, or so much thereof as has not theretofore been applied by Lessor
shall be returned, without payment of interest or other increment for its use,
to Lessee (or, at Lessor's option, to the last assignee, if any, of Lessee's
interest hereunder) at the expiration of the term hereof, and after Lessee has
vacated the premises. No trust relationship is created herein between Lessor and
Lessee with respect to said Security Deposit.
6. Use. 6.1 Use. The Premises shall be used and occupied for GENERAL
OFFICE, TESTING AND LIGHT ASSEMBLY and for no other purposes.
6.2 Compliance with Law.
(a) Lessee shall, at Lessee's expense, comply with all applicable
statutes, ordinances, rules, regulations, orders, restrictions of record, and
requirements in effect during the term or any part of the term hereof regulating
the used by Lessee of the Premises. Lessee shall not use nor permit the use of
the Premises in any manner that will create waste or a nuisance or, if there
shall be more than one tenant in the building containing the Premises, shall
disturb such other tenants.
6.3 Condition of Premises.
(a) Lessor shall deliver the Premises to Lessee clean and free of
debris on the Lease Commencement date (unless Lessee is already in possession)
and Lessor warrants to Lessee that the plumbing, lighting, air conditioning,
heating, and loading doors in the Premises shall be in good operating condition
on the Lease commencement date. In the event that it is determined that this
warranty has been violated, then it shall be the obligation of Lessor, after
receipt of written notice from Lessee setting forth with specificity the nature
of the violation, to promptly, at Lessor's sole cost, rectify such violation.
Lessee's failure to give such written notice to Lessor within thirty (30) days
after the Lease commencement date shall cause the conclusive presumption that
Lessor has complied with all of Lessor's obligations hereunder. The warranty
contained in this paragraph shall be of no force or effect if prior to the date
of this Lease, Lessee was an owner or occupant of the Premises.
(b) Lessee hereby accepts the Premises in their condition existing
as of the date of the execution hereof, subject to all applicable zoning,
municipal, county and state laws, ordinances and regulations governing and
regulating the use of the Premises, and accepts this Lease subject thereto and
to all matters disclosed thereby and by the exhibits attached hereto. Lessee
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acknowledges that neither Lessor nor Lessor's agent has made any representation
or warranty as to the suitability of the Premises for the conduct of Lessee's
business.
7. Maintenance Repairs and Alterations.
7.1 Lessor's Obligations. Subject to the provisions of Paragraph 9
and except for damage caused by any negligent or intentional act or omission of
Lessee, Lessee's agent, employees or invitees in which event Lessee shall repair
the damage, Lessor, at Lessor's expense, shall keep in good order, condition and
repair the sprinkling system, foundations, exterior walls and the exterior roof
of the Premises. Lessor shall not, however, be obligated to paint such exterior,
nor shall Lessor be required to maintain the interior surface of exterior walls,
windows, doors or plate glass. Lessor shall have no obligation to make repairs
under this Paragraph 7.1 until a reasonable time after receipt of written notice
of the need for such repairs. Lessee expressly waives the benefits of any
statute now or hereafter in effect which would otherwise afford Lessee the right
to make repairs at Lessor's expense or to terminate this lease because of
Lessor's failure to keep the Premises in good order, condition and repair.
Notwithstanding the foregoing to the extent Lessor fails to undertake repair and
maintenance required of Lessor hereunder within thirty (30) days of written
notice from Lessee and diligently continue such repair and maintenance, Lessee
shall be entitled to undertake such repair and maintenance and be reimbursed by
Lessor for the reasonable actual out-of-pocket expenses incurred by Lessee
relating thereto.
7.2 Lessee's Obligations.
(a) Subject to the provisions of Paragraph 7 and 9, Lessee, at
Lessee's expense, shall keep in good order, condition and repair the Premises
and every part thereof (whether or not the damaged portion of the Premises or
the means of repairing the same are reasonable or readily accessible to Lessee)
including, without limiting the generality of the foregoing, all plumbing,
heating, air conditioning, ventilating, electrical and lighting facilities and
equipment within the Premises, fixtures, ceilings, window, doors, plate glass,
skylights, and interior walls and interior surface of exterior walls located
within the Premises, including, but not limited by, all landscaping, driveways,
parking lots, fences and signs located in the Premises and all sidewalks and
parkways adjacent to the premises. Lessee shall keep all exterior areas in a
neat and orderly condition, and shall not allow trash, cartons, crates and so
forth, to accumulate or be left laying in the parking lots or anywhere else on
the property. Lessee expressly waives the benefit of any statute now or
hereinafter in effect which would otherwise afford the Lessee the right to make
repairs at Lessor's expense or to terminate this lease because of Lessor's
failure to keep the Premises in good order, condition and repair.
Notwithstanding the foregoing, to the extent Lessor fails to undertake repair
and maintenance, Lessee shall be entitled to undertake such repair and
maintenance and be reimbursed by Lessor for the reasonable actual out-of-pocket
expenses incurred by Lessee relating thereto.
(b) HVAC Maintenance. Lessee shall keep all portions of the
heating, ventilation and air conditioning (including evap/swamp coolers when
applicable) in good order, condition and repair, and shall be solely responsible
for all major and minor maintenance and repairs to said systems. If any portion
of the system or equipment in the Property which Lessee is obligated to repair
cannot be fully repaired or restored, Lessee shall promptly replace such portion
of the system or equipment, regardless of whether the benefit of such
replacement extends beyond the Lease Term; but if the benefit of useful life
(HVAC unit 10 year useful life; HVAC compressor: 5 year useful life: EVAP 5 year
useful life) of such replacement extends beyond the Lease Term
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(as such term may be extended by exercise of any options), the useful life of
such replacement shall be prorated over the remaining portion of the Lease Term
(as extended). Lessee shall obtain Lessor's written approval prior to performing
any replacement. Lessor shall have the right to enter into a service contract on
the Building for the heating, ventilation and air conditioning equipment for
periodic inspection and service of such equipment at a price and schedule as is
reasonable and normal within the Industry. Lessee shall reimburse Lessor
pursuant to the provisions hereof. In addition, Lessor shall have the option to
perform Spring air conditioning maintenance and Spring evap/swamp cooler startup
(if applicable), and Fall air conditioning/heating preparation and evap/swamp
cooler winterization, and/or service (if applicable). Lessee shall reimburse
Lessor upon presentation of a written invoice(s) for said Spring/Fall servicing.
(c) On the last day of the term hereof, or any sooner termination,
Lessee shall surrender the Premises to Lessor in the same condition as received,
broom clean, ordinary wear and tear excepted. Lessee shall repair any damage to
the Premises occasioned by the removal of its trade fixtures, furnishings and
equipment pursuant to Paragraph 7.3(d), which repair shall include the patching
and filling of holes and repair/of structural damage.
7.3 Alterations and Additions.
(a) Lessee shall not, without Lessor's prior consent, which
consent shall not be unreasonably or arbitrarily withheld, make any alterations,
improvements, additions or Utility installments in, or about the Premises,
except for nonstructural alterations not exceeding $1000.00 in cost. As used in
this Paragraph 7.3 term "Utility Installation" shall mean bus ducting, power
panels, wiring, fluorescent fixtures, space heaters, conduits, air conditioning
and plumbing. Lessor may require that Lessee remove any or all of said
alterations, improvements, additions or Utility installations at the expiration
of the term, and restore the Premises to their prior condition. Lessor may
require Lessee to provide Lessor at Lessee's sole cost and expense a lien and
completion bond in an amount equal to one and one-half times the estimated cost
of such improvements, to insure Lessor against any liability for mechanic's and
materialmen's liens and to insure completion of the work. Should Lessee make any
alterations, improvements, additions or Utility installations without prior
approval of Lessor, Lessor may require Lessee remove any and/or all of such.
(b) Any alterations, improvements, additions or Utility
installations in or about the Premises that Lessee shall desire to make and
which requires the consent which consent, shall not be unreasonably or
arbitrarily withheld, of the Lessor shall be presented to Lessor in written
form, with proposed detailed plans. If Lessor shall give its consent, which
consent shall not be unreasonably or arbitrarily withheld, the consent shall be
deemed conditioned upon Lessee acquiring a permit to do so from appropriate
governmental agencies, the furnishing of a copy thereof to Lessor prior to the
commencement of the work and the compliance by Lessee of all conditions of said
permit in a prompt and expeditious manner.
(c) Lessee shall pay, when due, all claims for labor or materials
furnished or alleged to have been furnished to or for Lessee at or for use in
the Premises, which claims are or may be secured by any mechanics' or
materialmen's lien against the Premises or any interest therein. Lessee shall
give Lessor not less than ten (10) days notice prior to the commencement of any
work in the Premises and Lessor shall have the right to post notices of
non-responsibility in or on the Premise as provided by law. If Lessee shall, in
good faith, contest the validity of any such lien claim or demand, then Lessee
shall, at its sole expense, defend itself and Lessor against the same and shall
pay and satisfy any such adverse judgment that may be rendered thereon before
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the enforcement thereof against the Lessor or the Premises, upon the condition
that if Lessor shall require, Lessee shall furnish to Lessor a surety bond
satisfactory to Lessor in an amount equal to such contested lien claim or demand
indemnifying Lessor against liability for the same and holding the Premises free
from the effect of such lien or claim.
(d) Unless Lessor requires their removal, as set forth in 7.3 (a),
all alterations, improvements, additions and Utility installments (whether or
not such Utility installations constitute trade fixtures of Lessee), which may
be made on the Premises, shall become the property of Lessor and remain upon and
be surrendered with the Premises so that it cannot be removed by Lessee subject
to the provisions of Paragraph 7.2(d).
8. Insurance: Indemnity.
8.1 Liability Insurance. Lessee shall, at Lessee's expense, obtain
and keep in force during the term of this Lease a policy of Combined Single
Unit, Bodily Injury and Property Damage insurance insuring the Lessor and Lessee
against any liability arising out of the ownership, use, occupancy or
maintenance of the Premises and all areas appurtenant thereto. Such insurance
shall be a combined single limit policy in any amount not less than
$1,000,000.00. The policy shall contain cross liability endorsements and shall
insure performance by Lessee of the indemnity provisions of the Paragraph 8. The
limits of said insurance shall not, however, limit the liability of Lessee
hereunder. In the event that the Premises constitute a part of a larger
property, said insurance shall have a Lessors Protective Liability endorsement
attached thereto. If Lessee shall fail to procure and maintain said insurance
Lessor may, but shall not be required to procure and maintain the same, but at
the expense of Lessee. Not more frequently than each Five (5) years, if, in the
reasonable opinion of Lessor, the amount of liability insurance required
hereunder is not adequate, Lessee shall increase said insurance coverage as
required by Lessor. Provided, however, that in no event shall the amount of
liability insurance increase be more than Fifty (50%) percent greater than the
amount thereof during the preceding Five (5) years of the term of this lease.
However, the failure of Lessor to require any additional insurance coverage
shall not be deemed to relieve Lessee from any obligations under this Lease.
8.2 Property Insurance.
(a) Lessor shall obtain and keep in force during the term of this
Lease a policy or policies of insurance covering loss or damage to the Premises,
but not Lessee's fixtures, equipment or tenant improvements in the amount of the
full replacement value thereof, providing protection against all perils included
within the classification of fire, extended coverage, vandalism, malicious
mischief, special extended perils (all risk) but not plate glass insurance.
(b) Lessee shall pay to Lessor, during the term hereof, in
addition to rent, its pro rata share (as set forth in Paragraph 3.3 herein) of
the amount of any increase in premiums for the insurance required under this
Paragraph 8.2 over and above such premiums paid during the Base Period, as
hereinafter defined, whether such premium increase shall be the result of the
nature of the Lessee's occupancy, any act or omission of Lessee requirements of
the holder of a mortgage or trust covering the Premises, or increased valuation
of the Premises or general rate increases. In the event that the Premises have
been occupied previously the words "Base Period" shall mean the last Twelve (12)
months of the prior occupancy and in the event that the Premises have never been
previously occupied the words "Base Period" shall mean the lowest premium
reasonably obtainable for the said insurance for the Premises assuming the most
nominal use of the Premises. Provided, however, in lieu of the Base Period the
parties hereto may insert a
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dollars amount at the end of this sentence which figure shall be considered as
the insurance premium for the Base Period. Base Year 2001.
(c) If the Premises being leased herein are part of a larger
property, then Lessee shall not be responsible for paying any increase in the
property insurance caused by the acts or omission of any other tenant of the
building of which the Premises are a part.
(d) Lessee shall pay any such premium increase to Lessor within
Thirty (30) days after receipt by Lessee of a copy of the premium statement or
other satisfactory evidence of a the amount due if the insurance policies
maintained hereunder cover other improvements in addition to the Premises.
Lessor shall also deliver to Lessee a statement of the amount of such increase
attributable to the Premises and showing in reasonable detail the manner in
which such amount was computed. If the term of this Lease shall not expire
concurrently with the expiration of the period covered by such insurance,
Lessee's liability for premium increases shall be prorated on an annual basis.
8.3 Insurance Policies. Insurance required hereunder shall be in
companies holding a "General Policyholders Rating" of B plus or better as set
forth in the most current issue of "Best Insurance Guide". Lessee shall deliver
to Lessor copies of policies of liability insurance required under Paragraph 8.1
or certificates evidencing the existence and amounts of such insurance with loss
payable clauses satisfactory to Lessor. Lessee shall, within Ten (10) days prior
to the expiration of such policies, furnish Lessor with renewals or "binders"
thereof, or Lessor may order such insurance and charge the cost thereof to
Lessee, which amount shall be payable by Lessee upon demand. Lessee shall not do
or permit to be done anything which shall invalidate the insurance policies
refereed to in Paragraph 8.2.
8.4 Waiver of Subrogation. Lessee and Lessor each hereby waives
any and all rights of recovery against the other, or against the officers,
employees, agents and representatives of the other, for loss of or damage to
such waiving party or its property or the property of others under its control,
where such loss or damage is insured against under any insurance policy in force
at the time of such loss or damage. Lessee and Lessor shall, upon obtaining the
policies of insurance required hereunder, give notice to the insurance carrier
or carriers that the foregoing mutual waiver of subrogation is contained in this
lease.
8.5 Indemnity. Lessee shall indemnify and hold harmless Lessor
from and against any and all claims arising from Lessee's use of the Premises,
or from the conduct of Lessee's business or from any activity, work or things
done, permitted or suffered by Lessee in or about the Premises or elsewhere and
shall further indemnify and hold harmless Lessor from and against any and all
claims arising from any breach or default in the performance of any obligation
on Lessee's part to be performed under the terms of this Lease, or arising from
any negligence of the Lessee, or any of Lessee's agents, contractors, or
employees and from and against all costs, attorney's fees, expenses and
liabilities incurred in the defense of any such claim or any action or
proceeding brought thereon; and in case any action or proceeding be brought
against Lessor by reason of any such claim, Lessee upon notice from Lessor shall
defend the same at Lessee's expense by counsel satisfactory to Lessor. Lessee,
as a material part of the consideration to Lessor, hereby assumes all risk of
damage to property or injury to persons, in, upon or about the Premises arising
from any cause and Lessee hereby waives all claims in respect thereof against
Lessor.
8.6 Exemption of Lessor from Liability. Lessee hereby agrees that
Lessor shall not be liable for injury to Lessee's business or any loss of income
therefrom or for damage to the goods, wares, merchandise or other property of
Lessee, Lessee's employees, invitees, customers,
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or any other person in or about the Premises, nor shall Lessor be liable for
injury to the person of Lessee, Lessee's employees, agents or contractors,
whether such damage or injury is caused by or results from fire, steam,
electricity, gas, water or rain, or from the breakage, leakage, obstruction or
other defects of pipes, sprinklers, wires, appliances, plumbing, air
conditioning or lighting fixtures, or from any other cause, whether the said
damage or injury results from conditions arising upon the Premises or upon other
portions of the building of which the Premises are a part, or from other sources
or places, and regardless of whether the cause of such damage or injury or the
means or repairing the same is inaccessible to Lessee unless, in each case, such
injury or loss of income is the result of Lessor's negligence or misconduct.
Lessor shall not be liable for any damages arising from any act or neglect of
any other tenant, if any, of the building in which the Premises are located.
9. Damage or Destruction.
9.1 Partial Damage - Insured. Subject to the provisions of
Paragraphs 9.3 and 9.4, if the Premises are damaged and such damage was caused
by a casualty covered under an insurance policy required to be maintained
pursuant to Paragraph 8.2, Lessor shall at Lessor's expense repair such damage
as soon as reasonably possible and this Lease shall continue in full force and
effect but Lessor shall not repair or replace Lessee's fixtures, equipment or
tenant improvements.
9.2 Partial Damage - Uninsured. Subject to the provisions of
Paragraphs 9.3 and 9.4, if at any time during the Lease term hereof the Premises
are materially damaged, except by a negligent or willful act of Lessee (in which
event Lessee shall make the repairs, at its expense) and such damage was caused
by a casualty not covered under an insurance policy required to be maintained by
Lessor pursuant to Paragraph 8.2, Lessor may at Lessor's option either (i)
repair such damage as soon as reasonably possible at Lessor's expense, in which
event this Lease shall continue in full force and effect or (ii) give written
notice to Lessee within Thirty (30) days after the date of the occurrence of
such damage of Lessor's intention to cancel and terminate this lease in which
event Lessee shall have the right within Ten (10) days after the receipt of such
notice to give written notice to Lessor of Lessee's intention to repair such
damage, at Lessee's expense, without reimbursement from Lessor, in which event
this Lease shall continue in full force and effect and Lessee shall proceed to
make such repairs as soon as reasonably possible. If Lessee does not give such
notice within such Ten (10) day period this Lease shall be canceled and
terminated as of the date of the occurrence of such damage.
9.3 Total Destruction. If at any time during the term hereof the
Premises are totally destroyed from any cause whether or not covered by the
insurance required to be maintained by Lessor pursuant to Paragraph 8.2
(including any total destruction required by any authorized public authority)
this Lease shall automatically terminate as the date of such total destruction.
9.4 Damage Near End of Term. If the Premises are partially
materially destroyed or damaged during the last Six (6) months of the term of
this Lease, the Lessor may at Lessor's option cancel and terminate this Lease as
of the date of occurrence of such damage by giving written notice to Lessee of
Lessor's election to do so within Thirty (30) days after the date of occurrence
of such damage.
9.5 Abatement of Rent; Lessee's Remedies.
(a) If the Premises are partially destroyed or damaged and Lessor
or Lessee repairs or restores them pursuant to the provisions of this Paragraph
9, the rent payable hereunder for the period during which such damage, repair or
restoration continues shall be abated in proportion to
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the degree to which Lessee's uses of the Premises is impaired. Except for
abatement of rent, if any, Lessee shall have no claim against Lessor for any
damage suffered by reason of any such damage, destruction, repair or
restoration.
(b) if Lessor shall be obligated to repair or restore the Premises
under the provisions of this Paragraph 9 and shall not commence such repair or
restoration within Ninety (90) days after such obligations shall accrue, Lessee
may at Lessee's option cancel and terminate this Lease giving Lessor written
notice of Lessee's election to do so at any time prior to the commencement of
such repair or restoration. In such event this Lease shall terminate as of the
date of such notice.
9.6 Termination - Advance Payments. Upon termination of this Lease
pursuant to this Paragraph 9, an equitable adjustment shall be made concerning
advance rent and any advance payments made by Lessee to Lessor. Lessor shall, in
addition, return to Lessee so much of Lessee's security deposit as has not
theretofore been applied by Lessor.
10. Real Property Taxes.
10.1 Payment of Tax Increase. Lessor shall pay all real property
taxes applicable to the Premises; provided, however, that Lessee shall pay, in
addition to rent, the amount, if any, by which real property taxes applicable to
the premises increase over the fiscal tax year 2001. Such payments shall be made
by Lessee within Thirty (30) days after receipt of Lessor's written statement
setting forth the amount of such increase and the computation thereof. If the
term of this Lease shall not expire concurrently with the expiration of the tax
fiscal year, Lessee's liability for increased taxes for the last partial lease
year shall be prorated on an annual basis.
10.2 Definition of "Real Property" Tax. As used herein , the term
"real property tax" shall include any form of assessment, license fee,
commercial rental tax, levy, penalty if such penalty may be directly related to
act or omission of Lessee, or tax (other than inheritance or estate taxes),
imposed by any authority having the direct or indirect power to tax, including
any city, county, state or federal government, or any school, agricultural,
lighting, drainage or other improvement district thereof, as against any legal
or equitable interest of Lessor in the Premises or in the real property of which
the Premises are a part, as against Lessor's right to rent or other income
therefrom, or as against Lessor's business of leasing the Premises or any tax
imposed in substitution, partially or totally of any tax previously included
within the definition of real property tax or any additional tax the nature of
which was previously included within the definition of real property tax.
10.3 Joint Assessment. If the Premises are not separately assessed,
Lessee's liability shall be an equitable proportion of the real property taxes
for all of the land and improvements included within the tax parcel assessed,
such proportion to be determined by Lessor from the respective valuations
assigned in the assessor's work sheets or such other information as may be
reasonably available. Lessor's reasonable determination thereof, in good faith,
shall be conclusive.
10.4 Personal Property Taxes. (a) Lessee shall pay prior to
delinquency all taxes assessed against and levied upon trade fixtures,
furnishings, equipment and all other personal property of Lessee contained in
the Premises or elsewhere. When possible, Lessee shall cause said trade
fixtures, furnishings, equipment, and all other personal property to be assessed
and billed separately from the real property of Lessor. (b) If any of Lessee's
said personal property shall be assessed with Lessor's real property, Lessee
shall pay the taxes attributable to Lessee
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within Ten (10) days after receipt of a written statement setting forth the
taxes applicable to Lessee's property.
11. Utilities. Lessee shall pay for all water/sewer, trash, heat, light,
power, telephone and other utilities and services supplied to the Premises,
together with any taxes thereon. It is agreed that any of these items which are
not separately metered shall be accounted for by the Lessor, paid by the Lessor
and reimbursed by the Lessee based on Lessee's pro rat a share, upon
presentation of statements on a monthly basis. The Lessee's prorated share of
said common expenses shall be based upon the amount of square footage leased by
the Lessee in proportion to the total rentable area to be charged and is listed
in Provision 2 of this Lease Agreement.
12. Assignment and Subletting.
12.1 Lessor's Consent Required. Lessee shall not voluntarily or by
operation of law assign, transfer, mortgage, sublet or otherwise transfer or
encumber all or any part of Lessee's interest in this Lease or in the Premises,
without Lessor's prior written consent, which consent shall not be unreasonably
or arbitrarily withheld. Any attempted assignment, transfer, mortgage,
encumbrance or subletting without such consent, which consent shall not be
unreasonably or arbitrarily withheld, shall be void, and shall constitute a
breach of this Lease.
12.2 No Release of Lessee. Regardless of Lessor's consent, which
consent shall not be unreasonably or arbitrarily withheld, no subletting or
assignment shall release Lessee of Lessee's obligation or alter the primary
liability of Lessee to pay the rent and to perform all other obligations to be
performed by Lessee hereunder. The acceptance of rent by Lessor from any other
person shall not be deemed a waiver by Lessor of any provision hereof. Consent
to one assignment or subletting shall not be deemed consent, which consent shall
not be unreasonably or arbitrarily withheld to any subsequent assignments or
subletting. In the event of default by any assignee of Lessee or any successor
of Lessee in the performance of any of the terms hereof, Lessor may proceed
directly against Lessee without necessity of exhausting remedies against said
assignee. Lessor may consent, which consent shall not be unreasonably or
arbitrarily withheld to subsequent assignments or subletting of this Lease or
amendments or medications to this lease with assignees of Lessee, without
notifying Lessee, or any successors of Lessee, and without obtaining its or
their consent, which consent shall not be unreasonably or arbitrarily withheld,
thereto and such action shall not relieve Lessee of Liability under this Lease.
13. Defaults; Remedies
13.1 Defaults. The occurrence of any one or more of the following
events shall constitute a material default and breach of this Lease by Lessee.
(a) The vacating or abandonment of the Premises by Lessee.
(b) The failure by Lessee to make any payment of rent or any other
payment required to be made by Lessee hereunder as and when due, where such
failure shall continue for a period of Three (3) days after written notice
thereof from Lessor to Lessee.
(c) The failure by Lessee to observe or perform any of the
covenants, conditions or provisions of this Lease to be observed or performed by
Lessee, other than described in Paragraph (b) above, where such failure shall
continue for a period of Thirty (30) days after written notice hereof from
Lessor to Lessee, provided, however, that if the nature of Lessee's default is
such that more than Thirty (30) days are reasonably required for its cure, then
Lessee
9
shall not be deemed to be in default if Lessee commenced such cure within said
Thirty (30) day period and thereafter diligently prosecutes such cure to
completion.
(d) (i) The making by Lessee of any general arrangements for the
benefit of creditors; (ii) the filing by or against Lessee of a petition to have
Lessee adjudged bankrupt or a petition for reorganization or arrangements under
any law relating to bankruptcy (unless in the case of a petition filed against
Lessee, the same is dismissed within Sixty (60 days); (iii) if appointment of a
trustee or receiver to take possessions of substantially all of Lessee's assets
located at the Premises or of Lessee's interest in this Lease where possession
is not restored, Lessee within Thirty (30) days on or after attachment,
execution or other judicial seizure of substantially all of Lessee's assets
located at the Premises or of Lessee's interest in this Lease when such seizure
is not discharged within Thirty (30) days.
(e) The discovery by Lessor that any financial statement given to
Lessor by Lessee, any assignee of Lessee, any Sublessee, any successor in
interest of Lessee or any guarantor of Lessee's obligation hereunder, and any of
them, was materially false.
13.2 Remedies. Upon the occurrence of a material default as set
forth in Paragraph 13.1;
(a) Lessor may re-enter the premises with or without process of
law and take possession of the same and of all equipment and fixtures of Lessee
therein and expel or remove Lessee and all other parties occupying the Premises,
using such force as may be reasonably necessary to do so without being liable to
any prosecution for such re-entry or for the use of such force and without
terminating the Lease, at any time and from time to time relet the Premises or
any part thereof for the account of Lessee, for such term, upon such conditions
and at such rental as Lessor may deem proper. In such event Lessor may receive
and collect the rent from such re-letting and apply it against any amounts due
from Lessee hereunder (including without limitation such expenses as Lessor may
have incurred in recovering possession of the Premises, placing the same in good
order and condition, repairing the same for re-letting, and all other expenses,
commissions and charges including attorney's fees which Lessor may have paid or
incurred in connection with such repossession and re-letting). Lessee thereunder
shall be under no obligation to see to the application by Lessor of any rent
collected by Lessor nor shall Lessee have any right to collect any rent
thereunder. Whether or not the Premises are re-let, Lessee shall pay Lessor all
amounts required to be paid by Lessee up to the date of Lessor's re-entry and
thereafter Lessee shall pay Lessor, until the end of the term hereof, the amount
of all rent and other charges required to be paid by Lessee hereunder, less the
proceeds of such re-letting during the term hereof, if any, after payment of
Lessor's expenses as provided above. Such payments by Lessee shall be due at
such times as are provided elsewhere in this Lease, and Lessor need not wait
until the termination of this Lease to recover them by legal action or
otherwise. Lessor shall not, by any re-entry or other act, be deemed to have
terminated this Lease or the liability of Lessee for the total rent hereunder
unless Lessor shall give Lessee written notice of Lessor's election to terminate
this Lease.
(b) Lessor may give written notice to Lessee of Lessor's election
to terminate this Lease, re-enter the Premises with or without process of law
and take possession of the same and of all equipment and fixtures therein, and
expel or remove Lessee and all other parties occupying the Premises, using such
force as may be reasonably necessary to do so, without being liable to any
prosecution for such re-entry of for the use of such force. In such event Lessor
shall thereupon be entitled to recover from Lessee the worth, at the time of
such termination, of the excess, if any, of the rent and other charges required
to be paid by Lessee hereunder for the
10
balance of the term hereof (if this Lease had not been so terminated) over the
then reasonable rental value of the Premises for the same period.
13.3 Default by Lessor. Lessor shall not be in default unless
Lessor fails to perform obligations required of Lessor within a reasonable time,
but in no event later than Thirty (30) days after written notice by Lessee to
Lessor and to the holder of any first mortgage or deed of trust covering the
Premises whose name and address shall have theretofore been furnished to Lessee
in writing, specifying wherein Lessor has failed to perform such obligation,
provided, however, that if the nature of Lessor's obligation is such that more
than Thirty (30) days are required for performance then Lessor shall not be in
default if Lessor commences performance within such Thirty (30) day period and
thereafter diligently prosecutes the same to completion.
13.4 Late Charges. Lessee hereby acknowledges that late payment by
Lessee to Lessor of rent and other sums due hereunder will cause Lessor to incur
costs not contemplated by the Lease. The exact amount of which will be extremely
difficult to ascertain. Such costs include, but are not limited to, processing
and accounting charges, and late charges which may be imposed on Lessor by the
terms of any mortgage or trust deed covering the Premises. Accordingly, if any
installment of rent or any other sum due from Lessee is not postmarked to Lessor
or Lessor's designee within Ten (10) days after such amount shall be due, Lessee
shall pay to Lessor a late charge equal to 10% of such overdue amount. The
parties hereby agree such late charge represents a fair and reasonable estimate
of the costs Lessor will incur by reason of late payment by Lessee. Acceptance
of such late charge by Lessor shall in no event constitute a waiver of Lessee's
default with respect to such overdue amount, nor prevent Lessor from exercising
any of the other rights and remedies granted hereunder.
14. Condemnation. If the Premises or any portion thereof are taken under
the power of eminent domain, or sold under the threat of the exercise of said
power (all of which are herein called "condemnation"), this Lease shall
terminate as to the part so taken as of the date the condemning authority takes
title or possession, whichever first occurs. If more that Ten (10%) percent of
the floor area of the improvements on the Premises, or more than Twenty-Five
(25%) percent of the land area of the Premises which is not occupied by any
improvements, is taken to condemnation, Lessee may, at Lessee's option, to be
exercised in writing only within Ten (10) days after Lessor shall have given
Lessee written notice of such taking (or in the absence of such notice, within
Ten (10) days after the condemning authority shall have taken possession)
terminate this Lease as of the date the condemning authority takes such
possession. If Lessee does not terminate this Lease in accordance with the
foregoing, this Lease shall remain in full force and effect as to this portion
of the Premises remaining except that the rent shall be reduced in the
proportion that the floor area taken bears to the total floor area of the
building situated on the Premises. Any award for the taking of all or any part
of the Premises under the power of eminent domain or any payment made under
threat of the exercise of such power shall be the property of Lessor, whether
such award shall be made as compensation for diminution in value of its
leasehold or for the taking of the fee, or as severance damages, provided,
however, that Lessee shall be entitled to any award or loss of any damage to
Lessee's trade fixtures and removable personal property. In the event this Lease
is not terminated by reason of such condemnation, Lessor shall, to the extent of
severance damages received by Lessor in connection with such condemnation,
repair any damage to the Premises caused by such condemnation except to the
extent that Lessee has been reimbursed therefor by the condemning authority.
From the proceeds of any severance damages received by Lessee, to the extent
that Lessee
11
receives amounts in excess of costs of damages to Lessee's trade fixtures,
removal of personal property, and Lessee's improvements, Lessee shall pay any
such excess to Lessor upon proof that such funds are spent to complete such
building repairs.
15. Broker's Fee.
(a) Upon execution of this Lease by both parties, Lessor or
Lessor's agent shall pay to XXXXXX COMMERCIAL (XXXX XXXXXXXXXX), a licensed real
estate broker, a fee as set forth in a separate agreement between Lessor or
Lessor's agent and Broker, or in the event there is no separate agreement
between Lessor or Lessor's agent and said broker, the sum of BY SEPARATE
AGREEMENT for brokerage services rendered by said broker to Lessor in this
transaction and XXXXXX COMMERCIAL, in the event there is a cooperating broker,
shall pay METRO COMMERCIAL PROPERTIES as Cooperating Broker a fee set forth in a
separate agreement between Broker and the Cooperating Broker.
(b) Lessor further agrees that if Lessee exercises any Option as
described in any Addenda hereto or any expansions, which is granted to Lessee
under this Lease, or any subsequently granted option which is substantially
similar to an Option granted to Lessee under this Lease, or if Lessee acquires
any rights to the Premises or other premises described in this Lease which are
substantially similar to what Lessee would have acquired had an Option herein
been granted to Lessee been exercised, or if Lessee remains in possession of the
Premises after the expiration of the term of this Lease after having failed to
exercise an Option, or if said broker(s) are the procuring cause of any other
lease or sale entered into between the parties pertaining to the Premises and/or
any adjacent property in which Lessor has an interest, then as to any of said
transactions, Lessor or Lessor's agent shall pay said broker a fee in accordance
with the schedule of said broker(s) in effect at the time of execution of this
Lease.
(c) Lessor agrees to pay said fee not only on behalf of Lessor but
also on behalf of any person, corporation, association, or other entity having
an ownership interest in said real property or any part thereof, when such fee
is due hereunder. Any transferee of Lessor's interest in this Lease, whether
such transfer is by agreement or by operation of law, shall be deemed to have
assumed Lessor's obligation under this Paragraph 15. Said broker(s) shall be a
third party beneficiary of the provisions of this Paragraph 15.
16. General Provisions.
16.1 Estoppel Certificate.
(a) Lessee shall at any time upon not less than Ten (10) days
prior written notice from Lessor, execute, acknowledge and deliver to Lessor a
statement in writing (i) certifying that this Lease is unmodified and in full
force and effect (or, if modified, stating the nature of such modification and
certifying that this Lease, as so modified, is in full force and effect) and the
date to which the rent and other charges are paid in advance, if any, and (ii)
acknowledging that there are not, to Lessee's knowledge, any uncured defaults on
the part of the Lessor hereunder, or specifying such defaults if any are
claimed. Any such statement may be conclusively relied upon by any prospective
purchaser or encumbrancer of the Premises.
(b) Lessee's failure to deliver such statement within such time
shall be conclusive upon Lessee (i) that this Lease is in full force and effect,
without modification except as may be represented by Lessor, (ii) that there are
no uncured defaults in Lessor's performance and (iii) that not more than One (1)
month's rent has been paid in advance or such failure may be considered by
Lessor as a default by Lessee under this Lease.
12
(c) If Lessor desires to finance or refinance the Premises, or any
part thereof, Lessee hereby agrees to deliver to any lender designated by Lessor
such financial statements of Lessee as may be reasonably required by such
lender. Such statements shall include the past Three (3) years' financial
statement of Lessee. All such financial statements shall be received by Lessor
in confidence and shall be used only for the purposes herein set forth.
16.2 Lessor's Liability. The term "Lessor" as used herein shall
mean only the owner or owners at the time in question of the fee title or a
Lessee's interest in a ground lease of the Premises in the event of any transfer
of such title or interest. Lessor herein named (and in case of any subsequent
transfers the then guarantor) shall be relieved from and after the date of such
transfer of all liability as respects Lessor's obligations thereafter to be
performed, provided that any funds in the hands of Lessor or the then guarantor
at the time of such transfer, in which Lessee has an interest, shall be
delivered to the guarantor. The obligation contained in this Lease to be
performed by Lessor shall, subject as aforesaid, be binding on Lessor successors
and assigns only during their respective period of ownership.
16.3 Severability. The invalidity of any provision of this Lease as
determined by a court of competent jurisdiction, shall in no way affect the
validity or any other provision hereof.
16.4 Interest on Past-due Obligations. Except as expressly herein
provided, any amount due to Lessor not paid when due shall bear interest at 12%
per annum from the date due. Payment of such interest shall not excuse or cure
any default by Lessee under this Lease, provided, however, that interest shall
not be payable on late charges incurred Lessee nor on any amounts which late
charges are paid by Lessee.
16.5 Time of Essence. Time is of the essence.
16.6 Captions. Article and paragraph captions are not a part
hereof.
16.7 Incorporation of Prior Agreements; Amendments. This lease
contains all agreements of the parties with respect to any matter mentioned
herein. No prior agreement or understanding pertaining to any such matter shall
be effective. This Lease may be modified in writing only, signed by the parties
in interest at the time of the modification. Except as otherwise stated in this
Lease, Lessee hereby acknowledges that neither the real estate Broker listed in
Paragraph 15 hereof nor any cooperating broker on this transaction nor the
Lessor or any employees or agents of any said persons has made any oral or
written warranties or representations to Lessee relative to the condition or use
by Lessee of said Premises and Lessee acknowledges that Lessee assumes all
responsibility regarding the Occupational Safety Health Act, the legal use and
adaptability of the Premises and the compliance thereof with all applicable laws
and regulations in effect during the term of this Lease except as otherwise
specifically stated in this Lease.
16.8 Notices. Any notice required or permitted to be given
hereunder shall be in writing and may be given by personal delivery or by
certified mail, and if given personally or by mail, shall be deemed sufficiently
given if addressed to Lessee or to Lessor at the address noted below the
signature of the respective parties, as the case may be. Either party may by
notice to the other specify a different address for notice purposes except that
upon Lessee's taking possession of the Premises, the premises shall constitute
Lessee's address for notice purposes. A copy of all notices required or
permitted to be given to Lessor hereunder shall be concurrently transmitted to
such party at such addresses as Lessor may from time to time hereafter designate
by notice to Lessee.
16.9 Waivers. No waivers by Lessor of any provision hereof shall be
deemed a waiver of any other provision hereof or of any subsequent breach by
Lessee of the same or any other
13
provision. Lessor's consent, which consent shall not be unreasonably or
arbitrarily withheld to or approval of any act shall not be deemed to render
unnecessary the obtaining of Lessor's consent, which consent shall not be
unreasonably or arbitrarily withheld to or approval of any subsequent act by
Lessee. This acceptance of rent hereunder by Lessor shall not be a waiver of any
preceding breach by Lessee of any provision hereof, other than the failure of
Lessee to pay the particular rent so accepted regardless of Lessor's knowledge
of such preceding breach at the time of acceptance of such rent.
16.10 Recording. Lessee shall not record this Lease without Lessor's
prior written consent, which consent shall not be unreasonably or arbitrarily
withheld, and such recordation shall, at option of Lessor constitute a
non-curable default of Lessee hereunder. Either party shall, upon request of the
other, execute, acknowledge and deliver the other a "short form" memorandum of
this Lease for recording purposes.
16.11 Holding Over. If Lessee remains in possession of the Premises
or any part thereof after the expiration of the term hereof without the express
written consent, such occupancy shall be a tenancy from month to month at a
rental rate in the amount of One Hundred Fifty (150%) Percent of the last
monthly rental plus all other charges payable hereunder and upon all terms
hereof applicable to a month to month tenancy.
16.12 Cumulative Remedies. No remedy or election hereunder shall be
deemed exclusive but shall, wherever possible, be cumulative withal other
remedies at law or in equity.
16.13 Covenants and Conditions. Each provision of this Lease
performable by Lessee shall be deemed both a covenant and a condition.
16.14 Binding Effect; Choice of Law. Subject to any provisions
hereof restricting assignment or subletting by Lessee and subject to the
provisions of Paragraph 16.2, this Lease shall bind the parties, their personal
representatives, successors and assigns. This Lease shall be governed by the
laws of the State of Arizona.
16.15 Subordination.
(a) This Lease, at Lessor's option, shall be subordinate to any
ground lease, mortgage, deed of trust, or any other hypothecation for security
now or hereafter placed upon the real property of which the Premises are a part
and to any and all advances made on the security thereof and to all renewals,
modifications, consolidations, replacements and extensions thereof.
Notwithstanding such subordination, Lessee's right to quiet possession of the
Premises shall not be disturbed if Lessee is not in default and so long as
Lessee shall pay the rent and observe and perform all of the provisions of this
Lease unless this Lease is otherwise terminated pursuant to its terms. If any
mortgagee, trustee or ground Lessor shall elect to have this Lease prior to the
lien of its mortgage, deed of trust, or ground lease, and shall give written
notice thereof to Lessee, this Lease shall be deemed prior to such mortgage,
deed of trust, or ground lease whether this Lease is dated prior or subsequent
to the date of said mortgage, deed of trust or ground lease or the date of
recording thereof.
(b) Lessee agrees to execute any documents required to effectuate
such subordination or to make this Lease prior to the lien of any mortgage, deed
of trust or ground lease, as the case may be, and failing to do so within Ten
(10) days after written demand, does hereby make, constitute and irrevocably
appoint Lessor as Lessee's attorney in fact and in Lessee's name place and
stead, to do so.
16.16 Attorney's Fees. If either party or the broker named herein
brings an action to enforce the terms hereof or declare rights hereunder, the
prevailing party in any such action, on trial or appeal, shall be entitled to
his reasonable attorney's fees to be paid by the losing party as
14
fixed by the court. The provisions of this paragraph shall inure to the benefit
of the broker named herein who seeks to enforce a right hereunder.
16.17 Lessor's Access. Lessor and Lessor's agents shall have the
right to enter the Premises at reasonable times with reasonable notice to Lessee
for the purpose of inspecting the same, showing the same to prospective
purchasers, lenders, or Lessees, and making such alterations, repairs,
improvements or additions to the Premises or to the building of which they are a
part as Lessor may deem necessary or desirable. Lessee shall have the right to
request execution of Confidentiality and Proprietary Rights Agreement by the
Lessor or Lessor's agents. Lessor may at any time place on or about the Premises
any ordinary "For Sale" signs and Lessor may at any time during the last One
Hundred Twenty (120) days of the term hereto place on or about the Premises any
ordinary "For Lease" signs, all without rebate of rent or liability to Lessee.
16.18 Signs and Auctions. Lessee shall not place any sign upon the
Premises or conduct any auction thereon without Lessor's prior written consent,
which consent shall not be unreasonably or arbitrarily withheld.
16.19 Merger. The voluntary or other surrender of this Lease by
Lessee or a mutual cancellation thereof, or a termination by Lessor, shall not
work a merger, and shall, at the option of Lessor, terminate all or any existing
subtenancies or may, at the option of Lessor, operate as an assignment to Lessor
of any or all of such subtenancies.
16.20 Corporate Authority. If Lessee is a corporation, each
individual executing this Lease on behalf of said corporation represents and
warranty that he is duly authorized to execute and deliver this Lease on behalf
of said corporation in accordance with a duly adopted resolution of the Board of
Directors of said corporation or in accordance with the bylaws of said
corporation and that this Lease is binding upon said corporation in accordance
with its terms. If Lessee is a corporation Lessee shall, within Thirty (30) days
after execution of this Lease deliver a certified copy to Lessor of a resolution
of the Board of Directors of said corporation authorizing or ratifying the
execution of this Lease.
16.21 Additional Rent. All monetary obligations of Lessee to Lessor
under the terms of this Lease, including but not limited to, Lessee's share of
operating expenses and insurance and tax expenses payable shall be deemed to be
rent.
16.22 Guarantor. In the event that there is a guarantor of this
Lease, said guarantor shall have the same obligations as Lessee under Paragraphs
16.1 and 16.20 of this Lease.
16.23 Quiet Possession. Upon Lessee paying the fixed rent reserved
hereunder and observing and performing all of the covenants, conditions and
provisions on Lessee's part to be observed and performed hereunder, Lessee shall
have quiet possession of the Premises for the entire term hereof subject to all
of the provisions of this Lease.
16.24 Multiple Tenant Building. In the event that the Premises are
part of a larger building or group of buildings then Lessee agrees that it will
abide by, keep and observe all reasonable rules and regulations which Lessor may
make from time to time for the management, safety, care and cleanliness of the
building and grounds, the parking of vehicles and the preservation of good order
therein as well as for the convenience of other occupants and tenants of the
building. The violations of any such rules and regulations, or the failure to
pay such prorata share of costs, shall be deemed a material breach of the Lease
by Lessee.
16.25 Parking. Uncovered parking spaces will be available for use by
all Lessees, customers and guests on a first come, first served basis. No
uncovered parking spaces are to be marked for specific use of any one Lessee. In
the event that covered parking is available, the
15
covered parking spaces will be marked for the Lessee by the Lessor and Lessee
will pay to Lessor at a separate monthly rate the sum deemed by Lessor, if any
payable at the same time and in the same manner as the rent for the Premises.
The parking spaces shall be described in the exhibit entitled "Parking Spaces"
attached to this Lease. Lessee agrees that Lessee shall be solely responsible
for the policing of the covered parking areas to insure that unauthorized
persons are not using the parking spaces allocated to Lessee.
16.26 Storage and Truck Dock. It is agreed that unless specific
exterior areas are included in the foregoing lease, no exterior storage shall be
allowed, included vehicles belonging to Lessee. In the event that Lessor
provides a common truck dock, the usage of such common truck dock shall be by
appointment in accordance with the guidelines established by Lessor, and Lessee
agrees that Lessee's use of the common truck dock shall not unduly tie up the
dock so as to make it unavailable for use by other Lessees.
16.27 Hazardous Materials. Lessee shall, and shall cause Lessee's
employees, agents, contractors and invitees to comply, at Lessee's sole cost and
expense, with all laws, rules, regulations, orders and the like relating to the
storage, use and/or disposal of flammable explosive materials, hazardous
materials, toxic substances and/or radioactive matter, including, without
limitations, substances identified as "hazardous" or "toxic" under any of the
laws described in the paragraph below (collectively "Hazardous Materials").
Lessee shall not cause or permit Lessee, its agents, employees, contractors, or
invitees to bring upon, keep, store, use or dispose of any Hazardous Materials
on, in or about the Premises or the parking facilities or common areas serving
the Premises (collectively "Adjacent Property") without the prior written
consent of Lessor, which consent Lessor may withhold on its sole discretion.
Lessee's breach of the covenants contained herein shall constitute a material
default under this Lease. If Lessor shall consent, to the presence, use, storage
and/or disposal of any Hazardous Materials on, in or about the Premises or any
Adjacent Property, Lessee shall cause such presence, use, storage and/or
disposal of Hazardous Materials by Lessee, its agents, employees, contractors'
invitees, to be in complete compliance with all applicable laws, rules,
regulations, orders and the like including without limitation, the laws
described in the paragraph below and such rules and regulations as Lessor may
impose in giving Lessee its consent as provided herein. Consent by Lessor to the
presence, use, storage and/or disposal of any specific Hazardous Material shall
not be deemed consent to the presence, use, storage and/or disposal of any other
Hazardous Materials. Lessee shall be solely responsible for and shall defend,
indemnify and hold Lessor, Lessor's agents, the Premises and the Adjacent
Property harmless from and against all claims, costs, fines, judgments and
liabilities, including attorney fees and costs arising out of or in connection
with the presence, storage, use and/or disposal of Hazardous Materials in, on or
under the Premises and/or Adjacent Property, and/or arising out of in connection
with the removal of Hazardous Materials from the Premises and/or Adjacent
Property, including without limitation any and all restoration work and
materials necessary to return the Premises and any Adjacent Property to their
condition existing prior to the appearance of the Hazardous Materials on the
Premises or such Adjacent Property. If Lessee shall receive notice, whether oral
or written, of any inquiry, test, investigation, enforcement proceeding,
environmental audit or the like by or against Lessee or the Premises, concerning
any Hazardous Materials allegedly introduced by Lessee, its employees, agents,
contractors, or invitees, Lessee shall immediately notify Lessor of such notice.
Lessee's obligations hereunder shall survive the termination of this Lease.
16
As used herein and elsewhere in this Lease, the term "Hazardous Materials" means
any hazardous or toxic substance, material or waste which is or becomes
regulation by any local governmental authority, any agency of the State of
Arizona or any agency of the United State Government (i) designated as a
"hazardous substance" pursuant to Section 311 of the Federal Water Pollution
Control Act (33 U.S.A. 1317), (ii) defined as a "Hazardous Recovery Act, 42
U.S.C. 6901 et seq. (42 U.S.A. 6903), (iii) defined a "hazardous substance"
pursuant to 101 of the Comprehensive Environmental Response, Compensation, and
Liability Act, 42 U.S.A. 9601 et seq. (42 U.S.C. 9601), (iv) Petroleum and any
petroleum and any petroleum by-products, (v) asbestos, and (vi) urea
formaldehyde foam insulation.
16.28 Exhibits. Attached hereto as Exhibits A through E made a part
hereof this Lease.
16.29 Additional Provisions. If there are additional provisions they
are placed following this page on the Addendum to Lease attached and made part
of this Lease Agreement. This lease has been prepared for submission to your
attorney who will review the document and assist you to determine whether your
legal rights are adequately protected. Xxxxxx Commercial is not authorized to
give legal or tax advice; no representation or recommendation is made by
Xxxxxxxx X. Xxxxxx, Ltd. or its agents or employees as to the legal sufficiency,
legal effect or tax consequences of this document or any transaction relating
thereto. These are questions for your attorney with whom you should consult
before signing this document.
The parties hereto have executed this Lease at the place on the dates specified
immediately adjacent to their respective signatures.
LESSOR: CARLETON INVESTORS, L.L.C.
(For Rental Payments) 0000 XXXX XXXXXXXX XXXXXX, XXXXX 000
XXXXXXX, XXXXXXX 00000
/s/ Xxxxxxxx X. Xxxxxx
----------------------------------------------------
Date: XXXXXXXX X. XXXXXX
LESSEE: SCANNER TECHNOLOGIES CORPORATION, A
(For Notices) MINNESOTA CORPORATION
0000 XXXXX XXX Xxxxx X-00
XXXXX, XXXXXXX
12/22/00 /s/ Xxxxx X. Xxxxx
----------------------------------------------------
Date: Its President
----------------------------------------------------
Date:
17
EXHIBIT A
GUARANTEE
For value received, the undersigned absolutely guarantees all payments under
that certain Lease Agreement dated for reference purposes only December 07, 2000
by and between CARLETON INVESTORS, L.L.C. (as Lessor) and SCANNER TECHNOLOGIES,
CORPORATION, A MINNESOTA CORPORATION (as Lessee) for the premises known as 0000
XXXXX XXX, Xxxxx X-00, XXXXX, XXXXXXX, executed by and, if obligor breaches any
terms of the Lease Agreement, the undersigned will be liable thereon demand.
The undersigned waive notice of acceptance, notice of nonpayment, protest and
notice of protest with respect to the obligation covered hereunder.
This guarantee shall continue in force and apply to all transactions
notwithstanding any change in the makeup of the debtor's corporate board and
officers or board member.
Liability under this Agreement shall commence on the date of the Lease, and
shall continue the obligation guaranteed hereunder is completely discharged.
This guarantee shall continue in effect notwithstanding any legal disability of
the debtor to incur the indebtedness or obligation in full or in part.
The creditor may proceed against any or all of the guarantors for any amount
guaranteed hereunder whether action is brought against the debtor or whether the
debtor is joined in any such action or actions or not.
Creditor may without notice sell, assign or transfer all the indebtedness or
obligation covered hereunder. In that event, each and every immediate and
successive assignee, transferee, or holder of all or any part of the
indebtedness or obligation shall have the right to enforce this guarantee by
legal action or otherwise for the benefit of such assignee, transferee, or
holder as fully as if such assignee, transferee, or holder were herein named
specifically given such right and power.
Should suit be brought to recover on this guarantee, the guarantor(s) promise to
pay as attorney's fees, a reasonable amount additional to the amount found due
hereunder.
GUARANTOR 1: /s/ Xxxxx Xxxxx
-----------------------------------------------------
HOME ADDRESS: 00000 Xxxxxx Xx., Xxxxxxxxxx, XX 00000
SOCIAL SECURITY NO.:
-------------------------------------------
18
