Exhibit 10.24


 


NEVADA
SHOPPING CENTER LEASE


 


MCQUEEN
CROSSINGS


 


between


 


MCQUEEN
CROSSINGS, LLC,


A
Nevada Limited Liability Company


 


“Landlord”


 


and


 


NEVADA
SECURITY BANK,


A
Nevada Corporation


 


“Tenant”


 

















 


TABLE OF
CONTENTS


 


	
  ARTICLE I

  	
  GRANT AND BASIC TERMS

  	
   

  	
   

  
	
   

  	
  Section 1.1

  	
  Effective Date of Lease

  	
   

  	
   

  
	
   

  	
  Section 1.2

  	
  Landlord

  	
   

  	
   

  
	
   

  	
  Section 1.3

  	
  Tenant

  	
   

  	
   

  
	
   

  	
  Section 1.4

  	
  Premises

  	
   

  	
   

  
	
   

  	
  Section 1.5

  	
  Length of Term

  	
   

  	
   

  
	
   

  	
  Section 1.6

  	
  Commencement of Term

  	
   

  	
   

  
	
   

  	
  Section 1.7

  	
  Acknowledgment of Commencement Date

  	
   

  	
   

  
	
   

  	
  Section 1.8

  	
  Permitted Uses

  	
   

  	
   

  
	
   

  	
  Section 1.9

  	
  Tenant’s Guarantor

  	
   

  	
   

  
	
   

  	
  Section 1.10

  	
  Initial Security Deposit

  	
   

  	
   

  
	
   

  	
  Section 1.11

  	
  Minimum Monthly Rent and Other Charges
  Payable by Tenant

  	
   

  	
   

  
	
   

  	
   

  	
  (a) Minimum Monthly Rent

  	
   

  	
   

  
	
   

  	
   

  	
  (b) Other Periodic Payments

  	
   

  	
   

  
	
   

  	
  Section 1.12

  	
  Excuse of Landlord’s Performance

  	
   

  	
   

  
	
   

  	
  Section 1.13

  	
  Intentionally Omitted

  	
   

  	
   

  
	
   

  	
  Section 1.14

  	
  Riders

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE II

  	
  LEASE TERM

  	
   

  	
   

  
	
   

  	
  Section 2.1

  	
  Lease of Premises for Lease Term

  	
   

  	
   

  
	
   

  	
  Section 2.2

  	
  Delay in Completion

  	
   

  	
   

  
	
   

  	
  Section 2.3

  	
  Early Occupancy

  	
   

  	
   

  
	
   

  	
  Section 2.4

  	
  Holding Over

  	
   

  	
   

  
	
   

  	
  Section 2.5

  	
  Successors

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE III

  	
  MINIMUM MONTHLY RENT

  	
   

  	
   

  
	
   

  	
  Section 3.1

  	
  Time and Manner of Payment

  	
   

  	
   

  
	
   

  	
  Section 3.2

  	
  Intentionally Omitted

  	
   

  	
   

  
	
   

  	
  Section 3.3

  	
  Intentionally Omitted

  	
   

  	
   

  
	
   

  	
  Section 3.4

  	
  Intentionally Omitted

  	
   

  	
   

  
	
   

  	
  Section 3.5

  	
  Security Deposit Increases

  	
   

  	
   

  
	
   

  	
  Section 3.6

  	
  Termination; Advance Payments

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IV

  	
  OTHER CHARGES PAYABLE BY TENANT

  	
   

  	
   

  
	
   

  	
  Section 4.1

  	
  Additional Rent

  	
   

  	
   

  
	
   

  	
  Section 4.2

  	
  Real Property Taxes .

  	
   

  	
   

  
	
   

  	
   

  	
  (a) Payments of Taxes

  	
   

  	
   

  
	
   

  	
   

  	
  (b) Definition of
  “Real Property Taxes”

  	
   

  	
   

  
	
   

  	
  Section 4.3

  	
  Personal Property Taxes

  	
   

  	
   

  
	
   

  	
  Section 4.4

  	
  Utilities

  	
   

  	
   

  
	
   

  	
  Section 4.5

  	
  Payment of Operating Costs .

  	
   

  	
   

  
	
   

  	
   

  	
  (a) Tenant’s Pro Rata Share of Expense .

  	
   

  	
   

  
	
   

  	
   

  	
  (b) Operating Cost

  	
   

  	
   

  
	
   

  	
   

  	
  (c) Changes in Square
  Footage of Premises

  	
   

  	
   

  
	
   

  	
  Section 4.6

  	
  Insurance Premiums

  	
   

  	
   

  
	
   

  	
   

  	
  (a)

  	
  Liability Insurance

  	
   

  
	
   

  	
   

  	
  (b)

  	
  Hazard and Rental Income Insurance

  	
   

  
	
   

  	
   

  	
  (c)

  	
  Insurance of Improvements

  	
   

  
	
   

  	
   

  	
  (d)

  	
  Payment of Premium; Insurance
  Policies

  	
   

  
	
   

  	
   

  	
  (e)

  	
  Increase
  in Fire Insurance Premium .

  	
   

  
	
   

  	
   

  	
  (f)

  	
  Plate Glass

  	
   

  
	
   

  	
   

  	
  (g)

  	
  Boiler Insurance

  	
   

  
	
   

  	
   

  	
  (h)

  	
  Waiver of Subrogation

  	
   

  
	
   

  	
   

  	
  (i)

  	
  Form of Policies

  	
   

  
	
   

  	
  Section 4.7

  	
  Interest on Past Due Obligations

  	
   

  	
   

  
	
   

  	
  Section 4.8

  	
  Collection of Operating Costs

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE V

  	
  RECORDS AND BOOKS OF ACCOUNT

  	
   

  	
   

  
	
   

  	
  Section 5.1

  	
  Intentionally Omitted

  	
   

  	
   

  
	
   

  	
  Section 5.2

  	
  Intentionally Omitted :

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VI

  	
  AUDIT

  	
   

  	
   

  
	
   

  	
  Section 6.1

  	
  Intentionally Omitted

  	
   

  	
   

  
	
   

  	
  Section 6.2

  	
  Intentionally Omitted

  	
   

  	
   

  
						



 

















 


	
  ARTICLE VII

  	
  CONSTRUCTION OF PREMISES.

  	
   

  	
   

  
	
   

  	
  Section 7.1

  	
  Landlord and Tenant Improvements

  	
   

  	
   

  
	
   

  	
  Section 7.2

  	
  Parking Facilities

  	
   

  	
   

  
	
   

  	
  Section 7.3

  	
  Changes and Additions to Buildings.

  	
   

  	
   

  
	
   

  	
  Section 7.4

  	
  Intentionally Omitted

  	
   

  	
   

  
	
   

  	
  Section 7.5

  	
  Right to Adjust

  	
   

  	
   

  
	
   

  	
  Section 7.6

  	
  Intentionally Omitted

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VIII

  	
  USE OF PROPERTY

  	
   

  	
   

  
	
   

  	
  Section 8.1

  	
  Permitted Uses

  	
   

  	
   

  
	
   

  	
  Section 8.2

  	
  Manner of Use

  	
   

  	
   

  
	
   

  	
   

  	
  (a)

  	
  Interference with Use/Nuisance

  	
   

  
	
   

  	
   

  	
  (b)

  	
  Violation of Law/Insurance Provisions

  	
   

  
	
   

  	
   

  	
  (c)

  	
  Permits

  	
   

  
	
   

  	
   

  	
  (d)

  	
  Store Operation .

  	
   

  
	
   

  	
   

  	
  (e)

  	
  Change of Name

  	
   

  
	
   

  	
   

  	
  (f)

  	
  Solicitation of Business

  	
   

  
	
   

  	
  Section 8.3

  	
  Competitive Business

  	
   

  	
   

  
	
   

  	
  Section 8.4

  	
  Indemnification

  	
   

  	
   

  
	
   

  	
   

  	
  (a) Indemnification of Landlord.

  	
   

  	
   

  
	
   

  	
   

  	
  (b)
  Indemnification of Tenant.

  	
   

  	
   

  
	
   

  	
  Section 8.5

  	
  Landlord’s Access

  	
   

  	
   

  
	
   

  	
  Section 8.6

  	
  Excavation

  	
   

  	
   

  
	
   

  	
  Section 8.7

  	
  Quiet Possession

  	
   

  	
   

  
	
   

  	
  Section 8.8

  	
  Intentionally Omitted

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IX

  	
  HAZARDOUS MATERIALS .

  	
   

  	
   

  
	
   

  	
  Section 9.1

  	
  Prohibition of
  Storage .

  	
   

  	
   

  
	
   

  	
  Section 9.2

  	
  Clean-Up

  	
  ,

  	
   

  
	
   

  	
  Section 9.3

  	
  Business .

  	
   

  	
   

  
	
   

  	
  Section 9.4

  	
  Termination
  of Lease .

  	
   

  	
   

  
	
   

  	
  Section 9.5

  	
  Assignment and
  Subletting

  	
   

  	
   

  
	
   

  	
  Section 9.6

  	
  Landlord’s
  Right to Perform Tests

  	
   

  	
   

  
	
   

  	
  Section 9.7

  	
  Tenant’s
  Obligations .

  	
   

  	
   

  
	
   

  	
  Section 9.8

  	
  Definition of
  “Hazardous Materials” .

  	
   

  	
   

  
	
   

  	
  Section 9.9

  	
  Landlord’s
  Warranty and Indemnification

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE X

  	
  PARKING AND COMMON USE AREAS AND FACILITIES

  	
   

  
	
   

  	
  Section 10.1

  	
  Control of Common Areas by Landlord

  	
   

  	
   

  
	
   

  	
  Section 10.2

  	
  License

  	
   

  	
   

  
	
   

  	
  Section 10.3

  	
  Merchants’ Association

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XI

  	
  SIGNS, AWNINGS, CANOPIES, FIXTURES,
  ALTERATIONS, IMPROVEMENTS

  	
   

  
	
   

  	
  Section 11.1

  	
  Signs and Auctions

  	
   

  	
   

  
	
   

  	
  Section 11.2

  	
  Installation by Tenant

  	
   

  	
   

  
	
   

  	
  Section 11.3

  	
  Improvements.

  	
   

  	
   

  
	
   

  	
  Section 11.4

  	
  Non-Removal by Tenant

  	
   

  	
   

  
	
   

  	
  Section 11.5

  	
  Intentionally Omitted

  	
   

  	
   

  
	
   

  	
  Section 11.6

  	
  Liens

  	
   

  	
   

  
	
   

  	
  Section 11.7

  	
  Signs, Awnings and Canopies.

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XII

  	
  CONDITION OF PROPERTY; MAINTENANCE, REPAIRS
  AND ALTERATIONS

  	
   

  
	
   

  	
  Section 12.1

  	
  Existing Conditions

  	
   

  	
   

  
	
   

  	
  Section 12.2

  	
  Exemption of Landlord from Liability;
  Waiver

  	
   

  	
   

  
	
   

  	
  Section 12.3

  	
  Tenant’s Obligations .

  	
   

  	
   

  
	
   

  	
  Section 12.4

  	
  Landlord’s Obligations

  	
   

  	
   

  
	
   

  	
  Section 12.5

  	
  Rules and Regulations .

  	
   

  	
   

  
	
   

  	
  Section 12.6

  	
  Condition Upon Termination

  	
   

  	
   

  
	
   

  	
  Section 12.7

  	
  Monitoring, Inspecting, and Remediating
  Mold

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XIII

  	
  DAMAGE OR
  DESTRUCTION

  	
   

  	
   

  
	
   

  	
  Section 13.1

  	
  Partial Damage to Leased Premises

  	
   

  	
   

  
	
   

  	
  Section 13.2

  	
  Total or Substantial Destruction

  	
   

  	
   

  
	
   

  	
  Section 13.3

  	
  Intentionally Omitted

  	
   

  	
   

  
	
   

  	
  Section 13.4

  	
  Landlord’s Obligations.

  	
   

  	
   

  
	
   

  	
  Section 13.5

  	
  Temporary Reduction of Rent

  	
   

  	
   

  
	
   

  	
  Section 13.6

  	
  Waiver

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XIV

  	
  CONDEMNATION

  	
   

  	
   

  
	
   

  	
  Section 14.1

  	
  Total Condemnation.

  	
   

  	
   

  
	
   

  	
  Section 14.2

  	
  Total Condemnation of Parking Area

  	
   

  	
   

  
	
   

  	
  Section 14.3

  	
  Partial Condemnation.

  	
   

  	
   

  
						



 


ii

















 


	
   

  	
  Section 14.4

  	
  Partial Condemnation of Parking Area .

  	
   

  	
   

  
	
   

  	
  Section 14.5

  	
  Condemnation of Less than a Fee

  	
   

  	
   

  
	
   

  	
  Section 14.6

  	
  Distribution of Condemnation Award .

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XV

  	
  ASSIGNMENT AND SUBLETTING

  	
   

  	
   

  
	
   

  	
  Section 15.1

  	
  Landlord’s Consent Required.

  	
   

  	
   

  
	
   

  	
  Section 15.2

  	
  Transfers of Interests in Tenant
  Requiring Landlord’s Consent

  	
   

  	
   

  
	
   

  	
  Section 15.3

  	
  Grant of Concessions; Conditions to
  Grant .

  	
   

  	
   

  
	
   

  	
  Section 15.4

  	
  Transfer Without Consent .

  	
   

  	
   

  
	
   

  	
  Section 15.5

  	
  No Release of Tenant

  	
   

  	
   

  
	
   

  	
  Section 15.6

  	
  Landlord’s Election .

  	
   

  	
   

  
	
   

  	
  Section 15.7

  	
  No Merger

  	
   

  	
   

  
	
   

  	
  Section 15.8

  	
  Assignment Fees and Procedures

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XVI

  	
  DEFAULTS;REMEDIES

  	
   

  	
   

  
	
   

  	
  Section 16.1

  	
  Covenants and Conditions

  	
   

  	
   

  
	
   

  	
  Section 16.2

  	
  Defaults

  	
   

  	
   

  
	
   

  	
  Section 16.3

  	
  Default by Landlord

  	
   

  	
   

  
	
   

  	
  Section 16.4

  	
  Remedies

  	
   

  	
   

  
	
   

  	
  Section 16.5

  	
  The Right to Relet the Premises

  	
   

  	
   

  
	
   

  	
  Section 16.6

  	
  Waiver of Rights of Redemption-

  	
   

  	
   

  
	
   

  	
  Section 16.7

  	
  Cumulative Remedies

  	
   

  	
   

  
	
   

  	
  Section 16.8

  	
  Late Charges

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XVII

  	
  PROTECTION OF CREDITORS

  	
   

  	
   

  
	
   

  	
  Section 17.1

  	
  Subordination

  	
   

  	
   

  
	
   

  	
  Section 17.2

  	
  Attornment

  	
   

  	
   

  
	
   

  	
  Section 17.3

  	
  Signing of Documents

  	
   

  	
   

  
	
   

  	
  Section 17.4

  	
  Estoppel Certificates .

  	
   

  	
   

  
	
   

  	
  Section 17.5

  	
  Tenant’s Financial Condition

  	
   

  	
   

  
	
   

  	
  Section 17.6

  	
  Mortgagee Protection Clause

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XVIII

  	
  LEGAL COSTS

  	
   

  	
   

  
	
   

  	
  Section 18.1

  	
  Legal Proceedings

  	
   

  	
   

  
	
   

  	
  Section 18.2

  	
  Landlord’s Consent

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XIX

  	
  MISCELLANEOUS PROVISIONS

  	
   

  	
   

  
	
   

  	
  Section 19.1

  	
  Non-Discrimination

  	
   

  	
   

  
	
   

  	
  Section 19.2

  	
  Landlord’s Liability; Certain Duties

  	
   

  	
   

  
	
   

  	
  Section 19.3

  	
  Severability .

  	
   

  	
   

  
	
   

  	
  Section 19.4

  	
  Interpretation

  	
   

  	
   

  
	
   

  	
  Section 19.5

  	
  Other Tenancies

  	
   

  	
   

  
	
   

  	
  Section 19.6

  	
  Entire Agreement

  	
   

  	
   

  
	
   

  	
  Section 19.7

  	
  Notices

  	
   

  	
   

  
	
   

  	
  Section 19.8

  	
  Waivers

  	
   

  	
   

  
	
   

  	
  Section 19.9

  	
  No Recordation

  	
   

  	
   

  
	
   

  	
  Section 19.10

  	
  Binding Effect; Choice of Law

  	
   

  	
   

  
	
   

  	
  Section 19.11

  	
  Corporate or Company Authority;
  Partnership Authority

  	
   

  	
   

  
	
   

  	
  Section 19.12

  	
  No Partnership.,

  	
   

  	
   

  
	
   

  	
  Section 19.13

  	
  Joint and Several Liability

  	
   

  	
   

  
	
   

  	
  Section 19.14

  	
  Force Majeure .

  	
   

  	
   

  
	
   

  	
  Section 19.15

  	
  Construction of Lease and Terms

  	
   

  	
   

  
	
   

  	
  Section 19.16

  	
  Accord and Satisfaction

  	
   

  	
   

  
	
   

  	
  Section 19.17

  	
  Provisions are Covenants and Conditions

  	
   

  	
   

  
	
   

  	
  Section 19.18

  	
  Intentionally Omitted

  	
   

  	
   

  
	
   

  	
  Section 19.19

  	
  Remodel

  	
   

  	
   

  
	
   

  	
  Section 19.20

  	
  Waiver of Right to Jury Trial

  	
   

  	
   

  
	
   

  	
  Section 19.21

  	
  Limitation of Actions

  	
   

  	
   

  
	
   

  	
  Section 19.22

  	
  Real Estate Brokers

  	
   

  	
   

  
	
   

  	
  Section 19.23

  	
  Exculpation

  	
   

  	
   

  



 


iii

















 


NEVADA SHOPPING CENTER LEASE


 


ARTICLE I


GRANT AND BASIC TERMS


 


This Article I contains the Basic Terns of this
Lease between the Landlord and Tenant named below. Other Articles, Sections and
Paragraphs of the Lease referred to in this Article I explain and define the
Basic ‘femls and are to be read in conjunction with the Basic Terms.


 


Section 1.1                                       Effective
Date of Lease. October 7 2003           


Section 1.2                                                                                                                     Landlord: MCOueen Crossirtes LLC a Nevada Limited Liability Company (hereinafter
“Landlord”)


 


Address
of Landlord: Post
Office Box 2888. De1 Mar, California 92014-5888

Overnight Deliveries Only: 221 Fifteenth Street. Del Mar, California 92014


 


Section 1.3       Tenant:
Nevada Security Bank, a Nevada Corporation, (hereinafter “Tenant”)


 


Address
of Tenant: Post Office
Box 19579, Reno, Nevada 89511

Overnight Deliveries Only: 9990 Double R Boulevard, Reno, NV 89521 (See
Section 19.7)


 


Section 1.4       Premises.     In consideration of the rents, covenants
and agreements on the part of Tenant to be paid and performed, Landlord hereby
leases to Tenant, and Tenant hereby leases from Landlord, at the rent and upon
the terms and conditions hereinafter set forth, that certain building space
three (3) drive-thru lanes, and one by-pass lane (hereinafter “Premises”), now
or hereafter to be erected Tenant, at Tenant’s sole expense, in the McQueen
Crossings (hereinafter “Shopping Center”), in the City of Reno of the County of Washoe, State of Nevada. The location of the
Premises is outlined in red on the site plan of the Shopping Center
attached hereto as Exhibit “A” and made a part hereof (hereinafter “Site
Plan’), and otherwise known as the building, three (3) drive-thru lanes, and
one by-mass lane of Pad F of McQueen Crossings located at SEC of Robb Drive and
Mae Anne Avenue, Reno, Nevada. For purposes of this Lease, the Premises is
agreed to have a building floor area of approximately 3,000 square feet
and a land area of approximately 45,958 square feet. Tenant acknowledges that
such addresses is preliminary and may or not reflect the final physical or
mailing address of the Premises. Tenant acknowledges that the layout of the
Shopping Center as shown on the Site flan attached as Exhibit “A” is tentative
and that Landlord may change the shape, size, location, number and extent of
the improvements shown thereon and eliminate or add any improvements to any
portion of the Shopping Center as provided in Article VII herein.


 


Section 1.5       Length
of Term.     The term of this Lease
(hereinafter “Term”) shall be for twenty (20) years and zero
(0) months commencing at 8:00 A.M. on the Commencement Date (hereinafter
defined), and expiring at 5:00 P.M. on the last day of the Term, unless sooner
terminated under any provision hereof.


 


Section 1.6       Commencement
of Term. The Term of this Lease, and Tenant’s obligation to pay rent, shall
commence (hereinafter “Commencement Date”) on the first to occur of the
following events:


 


(a)
the date which is two hundred seventy (270) days after the Landlord, or the
Landlord’s supervising architect, or other agent so authorized in writing by
Landlord, notifies the Tenant that the pad upon which the Premises is to be
constructed is ready for delivery to Tenant (hereinafter “Notice of Substantial
Completion”); or


 


(b)
the date on which the Tenant shall open the Premises for business to the
public.


 


Tenant
shall construct a building and all other improvements to be constructed by
Tenant pursuant to Exhibit B hereof and occupy the Premises within two hundred
seventy (270) days after the date of the Notice of Substantial Completion, and
shall thereafter continuously operate and conduct in the Premises the Permitted
Use (hereinafter defined).


 


In
the event that the Commencement Date does not occur on the first day of the
month, then the Term shall commence on the first day of the month next
succeeding the Commencement Date, provided Tenant shall pay Minimum Monthly
Rent and Other Periodic Payments as provided in Section 1.11 (b) below, for the
fractional month from the Commencement Date through the first day of the next
succeeding month on a per diem basis, calculated on the basis of a thirty
[30]-day month, in advance. All Lease expirations, renewal dates, notices of
options to renew, and any other provision hereof relating to the commencement
of the Term of this Lease shall be determined by reference to (i) the
Commencement Date where same occurs on the first day of the month, or (ii) on
the first day of the next succeeding month where the Commencement Date does not
occur on the first day of the month.


 


Landlord
shall not be liable to Tenant if Landlord does not deliver possession of the
Premises to Tenant on the first date specified in Section 1.6.


 


Section 1.7       Acknowledgment
of Commencement Date      When the
Commencement Date of the Lease has been ascertained pursuant to Section 1.6 and
Article 11, the parties shall immediately execute a confirmation of such date
together with the Term of this Lease and other information in the form set
forth in Exhibit “C” attached hereto and made a part hereof.


 

















 


Section 1.8       Permitted
Uses. The Premises shall be used and occupied only for  the operation of  a
financial institution accepting federally insured deposits and conducting the
kinds of private banking, commercial and financial transactions and offering
the sorts of  financial services and products normally
associated with a full service batik branch, including the sale of investment
related insurance products, stock brokerage and the installation, operation, maintenance,
repair and replacement of banking ATMs (provided, that (i) Tenant may install
interior banking ATMs in accordance with the Permitted Uses and other
applicable provisions of this Lease at Tenant’s discretion, however, in no
event shall Tenant install more than two (2) exterior banking ATMs; (ii) the
installation location and methods must be approved in advance by Landlord in
Landlord’s reasonable discretion; and (iii) the exterior banking ATMs shall be
located in Tenant’s storefront), and for no other rise or purpose.
Additionally, Tenant shall have the right to install not more than three (3)
drive-up ATM sin Tenant’s drive-that lanes (with not more than one (1) ATM in
any such drive-thru lane) in accordance with plans prepared by Tenant and approved
by Landlord. Notwithstanding the foregoing, in no event shall the Premises or
any portion thereof be used and occupied for: (a) gaming; (b) to sell, rent
and/or distribute prerecorded video cassettes, video tapes, video discs, laser
discs, video games (including without limitation CD-I), DVD, divx, or other
video software (including CD-ROM) and/or substitutes for, or items which are a
technological evolution of, the foregoing items; (c) the sale of alcohol for on
Premises or off Premises consumption; (d) for a mechanical or electronic games
arcade; or (e) gasoline or other fuels or power sources for vehicles. (See
Article VIII and Section 12.1)


 


Section 1.9                    Tenant’s Guarantor.     
(If none, so state.) None.


 


Section 1.10     Security
Deposit.      (Sec Section 3.5) Eleven
thousand two hundred fifty and 00/100 Dollars ($11,250.00).


 


Section 1.11    Minimum
Monthly Rent and Other Charges Payable by Tenant.


 


(a) Minimum Monthly Rent.   Eleven thousand two hundred fifty  and 00/100 Dollars ($11,250.00)
per month for the first sixty (60) months, as provided in Section 3.1, which
shall be increased every five (5) years on the day and the month on which the
Commencement Date occurs in each consecutive five (5) year period following the
Commencement Date (hereinafter “Anniversary Date”), pursuant to Rider Two.


 


(b)  Other Periodic Payments.   Monthly Payments of Operating Costs (as
defined in Section 4.8) including, without limitation, Taxes, Utilities,
Insurance Premiums, and all other amounts provided in this Lease to be paid by
Tenant. Landlord’s estimate of Tenant’s initial monthly charge for Operating
Costs is one thousand two hundred and 00/100 Dollars ($1,200.00).


 


Section 1.12    Excuse
of Landlord’s Performance. Anything in this Lease to the contrary
notwithstanding, providing such cause is not due to the willful act or neglect
of Landlord, Landlord shall not be deemed in default with respect to the
performance of any of the terms, covenants and conditions of this
Lease if same shall be due to any strike, lockout, civil commotion, war-like
operation, invasion, bioterrorism, terrorism, rebellion, hostilities, military
or usurped power, sabotage, governmental regulations or controls, inability to
obtain any material, service or financing, rain or muddy conditions, through
act of God or other cause beyond the control of
Landlord.


 


Section 1.13              Intentionally Omitted.


 


Section 1.14    Riders.   The following Riders and Addenda are
attached to and made a pail of this Lease: (If none, so state) Rider One.
Rider Two, Rider Three, Rider Four, and Rider Five,


 


ARTICLE 11


LEASE TERM


 


Section 2.1       Lease
of  Premises for Lease Term. The Term of this Lease is for the period of
time stated in Section 1.5 above and shall begin and end on the dates specified
in Section 1.6 above, unless the beginning or end of the Term is changed under
any provision of this Lease.


 


Section 2.2       Delay
in Completion.   In the event the
improvements to the Premises to be completed by Landlord hereunder, if any, are
not substantially completed on or before September 30. 2004, this Lease
may be terminated by either party upon not less than ten (10) days prior
written notice, in which event any Security Deposit deposited by Tenant with
Landlord shall be returned to Tenant. The aforementioned date shall be
automatically extended for a reasonable period of time provided Landlord is
diligently pursuing the completion of the Premises. Should either party so
elect to terminate this Lease, except for the return of the Tenant’s Security
Deposit, Landlord shall have no obligations or liabilities to Tenant for
damages of any kind relating to the failure to complete construction of the
Premises or any election to terminate this Lease pursuant to the terms and
conditions set forth in this Section 2.2.


 


Section 2.3       Early
Occupancy.   If Tenant occupies the
Premises prior to the Commencement Date, Tenant’s occupancy of the Premises
shall be subject to all of the provisions of this Lease. Early occupancy of the
Premises shall not advance the expiration date of this Lease. Tenant shall not
be required to pay Minimum Monthly Rent or Operating Costs, however shall pay
any and all other charges specified in this Lease for the early occupancy
period.


 


Section 2.4       Holding
Over.   Tenant shall completely
vacate the Premises upon the expiration or earlier termination of this Lease.
Tenant agrees to indemnify, defend and hold Landlord and its partners harmless
from and against any and all actions, claims, damages, demands, liens,
liability, costs and expenses specifically including, but not limited to,
reasonable attorneys fees, arising front or caused by any delay in Tenant
vacating the Premises. If Tenant remains in possession of all or any part of
the Premises after the expiration of the Term, such tenancy shall be
month-to-month only


 


2

















 


and shall not constitute a renewal hereof or
an extension for any further term. During any such holdover period, (i) the
Minimum Monthly Rent shall be increased to an amount equal to one hundred fifty
percent (150”%) of the Minimum Monthly Rent in effect prior to the expiration
or termination of the Lease, (ii) other monetary stuns due hereunder shall be
payable in the amounts and at the times specified in this Lease, and (iii) such
month-to-month tenancy shall be subject to every other term, covenant and
agreement contained herein, except that such tenancy may be terminated by
either party upon thirty (30) days prior written notice to the other.


 


Section 2.5      Successors.   All rights and liabilities herein given to,
or imposed upon, the respective parties hereto shall extend to and bind the
several respective heirs, executors, administrators, successors, and assigns of
such parties; and if there shall be more than one entity comprising Tenant,
such entities shall all be bound jointly and severally by the terms, covenants
and agreements herein. The foregoing notwithstanding, no rights shall inure to
tire benefit of any assignee or transferee of Tenant unless the transfer has
been approved by Landlord in writing as provided in Section 15.1 hereof.


 


ARTICLE III


RENT


 


Section 3.1      Time
and Manner of Payment.   Upon
execution of this Lease, Tenant shall pay Landlord Minimum Monthly Rent in the
amount stated in Section 1.11(a) above, for the first month of the Term, a Security
Deposit in the amount stated in Section 1.10 above. On or before the first day
of the second month of the Tern, and each month thereafter, Tenant shall pay
Landlord the Minimum Monthly Rent and any other charges and slims provided for
herein as Additional Rent, in advance, without offset, deduction or prior
demand. All such rents and charges shall be payable at Landlord’s address or at
such other place as Landlord may designate in writing. If Tenant submits a
check to Landlord which is returned to Landlord by Tenant’s bank due to
non-sufficient funds, Landlord may require Tenant to submit all future payments
in the form of a cashier’s check or money order.


 


Section 3.2                    Intentionally Omitted.


 


Section 3.3                    Intentionally Omitted.


 


Section 3.4                    Intentionally Omitted.


 


Section 3.5                    Security Deposit Increases.


 


(a)  Upon the execution of this Lease, Tenant
shall deposit with Landlord a cash Security Deposit in the amount set forth in
Section 1.10. Landlord may, but shall riot be obligated to, apply all or pail
of the Security Deposit to any unpaid rent or other charges due from Tenant or
to cure any other defaults of Tenant. If Landlord uses any part of the Security
Deposit, Tenant shall restore the Security Deposit to its full amount within
ten (10) days after Landlord’s written request, and Tenant’s failure to do so
shall be a material default under this Lease. No interest shall be paid on the
Security Deposit, and Landlord shall not be required to keep the Security
Deposit separate from its other accounts and no trust relationship is created
with respect to the Security Deposit.


 


(b)  Each time there is a Transfer under the
Lease requiring Landlord’s Consent pursuant to Article XV hereof, Tenant is in
breach or default of this Lease beyond any applicable cure period, or the
Shopping Center or a portion thereof that includes the Premises is sold by
Landlord, Tenant shall deposit additional funds with Landlord sufficient to
increase the Security Deposit to an amount which bears the same relationship to
the adjusted Minimum Monthly Rent as the initial Security Deposit bore to the
initial Minimum Monthly Rent.


 


(c)
Landlord may deliver the Security Deposit deposited hereunder by Tenant to a
purchaser of Landlord’s interest in the Premises in the event that such interest
be sold and, thereupon, Landlord shall be discharged from any further liability
with respect to such Security Deposit.


 


Section 3.6       Termination:
Advance Payments. Upon termination of this Lease under Article XIII (Damage
or Destruction), Article XIV (Condemnation) or any other termination not
resulting from Tenant’s default, and after Tenant has vacated the Premises in
the manner required by this Lease, an equitable adjustment shall be made
concerning advance rent, any other advance payments made by Tenant to Landlord,
and accrued real property taxes, and Landlord shall refund the unused portion
of the Security Deposit to Tenant or Tenant’s successor.


 


ARTICLE 1V


OTHER CHARGES PAYABLE BY TENANT


 


Section 4.1       Additional
Rent.   All charges payable by Tenant
hereunder, other than Minimum Monthly Rent, are collectively referred to as
“Additional Rent”. Unless this Lease provides otherwise, all Additional Rent
shall be paid with the next monthly installment of Minimum Monthly Rent. The
term “rent” shall mean Minimum Monthly Rent and Additional Rent.


 


Section 4.2       Real
Property Taxes.


 


(a)  Payment of Taxes. Tenant agrees to pay Tenant’s
pro rata share of all Real Property Taxes, as hereinafter defined, which may be
levied or assessed by any lawful authority against the land on which buildings
are located and improvements thereon in the Shopping Center (hereinafter
collectively “Real Property Taxes”). Tenant shall pay its


 


3

















 


share of such Real Property Taxes upon receipt
of a statement from Landlord delineating Tenant’s share of same, which share
shall be paid within five (5) days after receipt of Landlord’s statement.
Landlord shall have the right to collect and impound from Tenant, and Tenant
agrees to pay on a monthly or quarterly basis Landlord’s reasonable estimate of
Tenant’s share of the Real Property Taxes next due. Tenant’s pro rata share of
Real Property Taxes for building improvements shall be apportioned according to
the floor area of the Premises as it relates to the total floor area of the
building or buildings which include the Premises (or the floor area of all
buildings included in any such assessment in the Shopping Center if the
individual buildings within the Shopping Center are not separately assessed).
Tenant’s pro rata share of Real Property Taxes for land and non-building
improvements thereon shall be apportioned based upon the ratio of the square
footage of land area of the parcel now or hereafter dedicated to the Premises
(which Landlord and Tenant hereby agree for the purpose of this Lease shall be
45,958 square feet) to the total square footage land area of all the land the
Shopping Center (including the common areas and improvements contained in and
about Pad H and Pad J shown oil the Site flan attached hereto that are not
owned by Landlord but are maintained by Landlord pursuant to that certain
Declaration of Covenants, Conditions and Establishment of Restrictions and
Grant of Easements for McQueen Crossings Shopping Center, as amended froth time
to three) included in any such assessment. All Real Property Taxes for the year
in which this Lease commences shall be apportioned and adjusted.


 


(b)  Definition of “Real Property Taxes”.
“Real Property Taxes” means: (i) any fee, license fee, license tax, business
license fee, commercial rental tax, levy, charge, assessment, penalty 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, agriculture, lighting, drainage or other improvement
district thereof, as against any legal or equitable interest of Landlord in the
Premises; (ii) any tax oil the Landlord’s right to receive, or the receipt of,
rent or income from the Premises or against Landlord’s business of leasing the
Premises; (iii) any tax or charge for fire protection, streets, sidewalks, road
maintenance, refuse or other services provided to the Premises by any
governmental agency; (iv) any tax imposed upon this transaction or based upon a
reassessment of the Premises due to a change in ownership or transfer of all or
part of Landlord’s interest in the Premises; and (v) any charge or fee
replacing any tax previously included within the definition of Real Property Taxes.
“Real Property Taxes” shall not, however, include Landlord’s federal or state
income, franchise, inheritance or estate taxes.


 


Section 4.3        Personal
Property Taxes.


 


(a) Tenant shall pay prior to delinquency all taxes
charged against the trade fixtures, furnishings, equipment or any other
personal property belonging to Tenant. Tenant shall use its best efforts to
have such personal property taxed separately from the Premises.


 


(b)  If any
such taxes on Tenant’s personal property are levied against Landlord or
Landlord’s property, or if the assessed value of the Premises is increased by
the inclusion therein of a value placed upon such personal property or trade
fixtures of Tenant, then Landlord, after written notice to Tenant, shall have
the right to pay the taxes based upon such increased assessments, regardless of
the validity thereof, but only under proper protest if requested by Tenant in
writing. If Landlord shall do so, then ‘Tenant shall, upon demand, repay to
Landlord the taxes levied against Landlord, or the proportion of such taxes
resulting from such increase in the assessment. In any such event, however,
Tenant, at Tenant’s sole cost and expense, shall have the right, in the name of
Landlord and with Landlord’s full cooperation, to bring suit in any court of
competent jurisdiction to recover the amount of any such taxes so paid under
protest; any amount so recovered to belong to Tenant.


 


(c) If any of Tenant’s personal property is
taxed with the Premises, Tenant shall pay Landlord the taxes for the personal
property within fifteen (15) trays after Tenant receives a written statement
from Landlord for such personal property taxes.


 


Section 4.4       Utilities.  Tenant shall pay, directly to the
appropriate supplier, the cost of all natural gas, heat, light, power, sewer
service, telephone, water, refuse disposal and other utilities and services
supplied to the Premises, unless Landlord elects to include the cost of any or
all of such utilities and services as a Shopping Center Operating Cost as
defined in Section 4.5(b). Maintenance for any heating and/or air conditioning
equipment and ducts oil the Premises shall be furnished by Tenant at Tenant’s
sole expense. If any services or utilities are jointly metered with other
properties, Landlord shall determine anti the Tenant shall pay, the Tenant’s
pro rata share of the monthly costs of such utilities and services. The
Tenant’s pro rata share shall be determined by the ratio of the square footage
floor area of the Premises as compared to the square footage floor area of all
the premises under the common metering. In the event Tenant shall require such
services or utilities in excess of that usually furnished or supplied for use
of the Premises as general retail space, Tenant shall pay a reasonable proportion,
to be determined by Landlord, of all such jointly metered charges. The Tenant
shall pay such charges within five (5) days of notification of the amount by
the Landlord. Landlord reserves the right to require Tenant to install and
maintain, at Tenant’s sole expense, separate meters for any public utility
servicing the Premises for which a separate meter is not presently installed.


 


Section 4.5       Patent
of Operating Costs.


 


(a) Tenant’s Pro Rata Share of Expense. Tenant
will also pay to Landlord, as further Additional Rent, a proportionate share of
the Shopping Center’s Operating Cost (hereinafter defined), based upon the
ratio of the square footage land area of the parcel now or hereafter dedicated
to the Premises (+/- 45,958 square feet) to the total square footage land area
of all the land the Shopping Center (including the common areas and
improvements contained in and about Pad H and Pad J shown oil the Site Plan
attached hereto that are not owned by Landlord but are maintained by Landlord
pursuant to that certain Declaration of Covenants, Conditions and Establishment
of Restrictions and Grant of Easements for McQueen Crossings Shopping Center,
as amended from time to time) and Landlord and Tenant hereby agree for purposes
of this Lease Tenant’s proportionate share of such Shopping Center’s Operating
Costs is 6.91%. Notwithstanding the foregoing, if during the Lease Term
Landlord permits any tenant or parcel owner in the Shopping


 


4

















 


Center to perform any item of Shopping Center
Operating Cost for its sole benefit and at its sole expense in lieu of
Landlord’s performance thereof (which Shopping Center Operating Cost item is
typically provided by Landlord to all tenants of the Shopping Center and the
cost of which would be included in Shopping Center Operating Cost pursuant to
Article IV or Article XII hereof, then Landlord shall have the right, but not
the obligation to equitably allocate the Shopping Center Operating Cost of such
specific Shopping Center Operating Cost item so that only those tenants in the
Shopping Center that directly or indirectly benefit from such Shopping Center
Operating Cost item shall pay such Shopping Center Operating Cost (such tenants
shall be hereinafter referred to as “Cost Pool Tenants’).


 


(b)
Operating Cost. For the purpose of this Section 4.5,
the term “Operating Cost” means the total cost and expense incurred in
connection with the operation, repair, management, maintenance and replacement
of all Common Areas and all improvements within the Shopping Center (including
the common areas and improvements contained in and about Pad H and Pad J shown
on the Site Plan attached hereto that are not owned by Landlord but are
maintained by Landlord pursuant to that certain Declaration of Covenants,
Conditions and Establishment of Restrictions and Grant of Easements for McQueen
Crossings Shopping Center, as amended from time to time) including, without
limitation, general maintenance and repair of all improvements; expenses
incurred by Landlord under Section 12.3 and Section 12.4 hereof; gardening and
landscaping; snow, water and ice removal and control; security services;
liability, property damage and all other insurance carried by Landlord under
Section 4.6 with types of coverage and in amounts determined by Landlord;
repairs; asphalt repairs, resurfacing and striping; painting of improvements;
servicing of common grease interceptors; holiday decorations; snow and ice
removal; utilities serving the improvements and Common Areas; sanitary control;
pest control; signage operation, repair arid replacement costs; removal of
mash, rubbish, garbage and other refuse; reasonable reserves for replacements
and repairs; a property management fee consistent with prevailing rates charged
in the industry (not to exceed five percent (5%) of gross Shopping Center
rents); bookkeeping; advertising and promotional fees; Real Property Taxes; all
personal property taxes assessed for any reason on the personal property used
in connection with the Shopping Center; costs of equipment and machinery used
to maintain or operate the Common Areas and any depreciation of the cost
thereof (including financing); and the cost of personnel to implement such
services, to direct parking, and to police the Common Areas. In addition,
Operating Cost shall include an administrative charge equal to ten percent
(10%) of the actual Operating Cost, and this charge shall be included in anti
billed as a part of the Operating Cost.


 


Notwithstanding the foregoing, in no event
shall the following items be included as an Operating Cost: items for which the
responsibility of repairing or maintaining or replacement is the direct
responsibility of a particular tenant under their respective lease with
Landlord, amounts reimbursed by insurance proceeds, or warranties; utilities or
other expenses paid directly by tenants to suppliers; ground rents; payments on
any mortgage, or deed-of-trust; leasing commissions; the cost of negotiating or
enforcing leases of other tenants; fines, penalties, and late fees or similar
costs incurred by Landlord; depreciation; costs of or arising from Landlord’s
charitable or political contributions; costs, including but not limited to
attorneys’ fees associated with the operation of the business of the
partnership or entity that constitutes Landlord as the same are distinguished
from the costs of operation of the Shopping Center, including partnership
accounting and legal matters, costs of defending any lawsuits with any
mortgage, costs of selling, syndicating, financing, mortgaging or hypothecating
any of Landlord’s interest in the Shopping Center or any part thereof, costs of
any disputes between Landlord and its employees, disputes of Landlord with
Shopping Center management or personnel, or outside fees paid in connection
with disputes with other tenants; costs incurred in removing and storing the
property of former tenants or occupants of the Shopping Center; lease
“takeover” expenses, including, but not limited to, the expenses incurred by
Landlord with respect to space located in another building of the Shopping
Center of any kind or nature in connection with the leasing of space in the
Shopping Center; costs incurred in connection with the original construction of
the Shopping Center, or; any costs, fees, dues, contributions or similar expenses for industry associations or similar
organizations.


 


Section 4.6      Insurance
Premiums.


 


(a)  Liability Insurance. During the Lease
Term, Tenant shall maintain a policy of commercial general liability insurance,
liquor liability insurance if Tenant offers the sale of alcohol in or from the
Premises, and mold liability insurance, at Tenant’s expense, insuring Tenant
against liability resulting out of the ownership, use, occupancy or maintenance
of die Premises, the sidewalks in front of the Premises, arid the business operated by Tenant and any
subtenants of Tenant in the Premises. The  initial
amount of such insurance shall be at least Two Million Dollars ($2,000,000.00)
combined single limit bodily injury, property damage and personal injury, arid
shall be subject to periodic increase based upon inflation, increased liability
awards, recommendations of professional
insurance advisers, and other relevant factors. However,
tire amount of such insurance shall not limit Tenant’s liability nor relieve
Tenant of any obligation hereunder. The policy shall name Landlord as an
additional insured. In addition Tenant, at Tenant’s expense, shall carry
adequate workers’ compensation insurance coverage and provide written evidence
to Landlord.


 


(b)
Hazard and Rental Income Insurance.
During the Lease Term, Landlord shall maintain policies of insurance covering
loss of or damage to the Shopping Center Improvements, including the shell
building improvements of the Premises, in the amount of its full replacement
cost, excluding Tenant’s Improvements, made fixtures and personal property.
Such polices shall provide protection against all perils included within the
classification of fire, extended coverage, vandalism, malicious mischief, and
may include endorsements or coverage for special extended perils (special
form), sprinkler leakage, inflation guard, and any other perils (including
flood and earthquake), which Landlord deems necessary. Tenant shall, at
Tenant’s expense, maintain such primary or additional insurance on its
fixtures, equipment and building improvements as Tenant deems necessary to
protect its interest. During the Lease Term, Landlord shall also maintain as an
Operating Cost a rental income insurance policy, with loss payable to Landlord
in an amount equal to one year’s Minimum Monthly Rent (as adjusted
periodically), plus estimated Real Property Taxes and insurance premiums.
Tenant shall not do or permit to be done anything which invalidates any such
insurance policies.


 


5

















 


(c)
Insurance of Improvements. Tenant shall at
all times maintain fire insurance with extended coverage in an amount adequate
to cover the cost of replacement of all trade fixtures, alterations,
decorations, additions or improvements made to the Premises by Tenant or by
Landlord on Tenant’s behalf in the event of fire or extended coverage loss or a
mold-related loss. Such insurance policy shall be maintained with an insurance
company licensed to do business in the State of Nevada and approved by
Landlord. Tenant shall deliver to the Landlord certificates of such fire
insurance policies which shall contain a clause requiring the insurer to give
the Landlord thirty (30) days’ written notice of cancellation of such policies.
Tenant’s obligation to maintain the foregoing insurance shall in no event
require Tenant to maintain insurance for the shell building improvements that
is maintained by Landlord pursuant to Section 4.6(b) hereof.


 


(d)  Payment of Premiums: Insurance Policies.
Tenant shall pay all premiums for the  insurance
policies covering the Premises described in Paragraphs 4.6(a) and (c) prior to
delinquency. If the insurance policies maintained by Landlord cover
improvements or real property other than the Shopping Center, Landlord shall
also deliver to Tenant a statement of the amount of the premiums applicable to
the Premises showing, in reasonable detail, how such amount was computed. If
the Lease Term expires before the expiration of the insurance policy period,
Tenant’s liability for insurance premiums shall be prorated on an annual basis.
Tenant shall be liable for its pro rata share of the payment of any deductible
amount under Landlord’s insurance policies as an item of Operating Cost.


 


(e)
Increase in Fire Insurance Premium.
Tenant agrees that it will not keep, use, manufacture, assemble, sell or offer
for sale in or upon the Premises any article which may be prohibited by the
standard form of fire insurance policy. Tenant agrees to pay any increase in
premiums for fire and extended coverage insurance that may be charged during
the Term of this Lease on the amount of such insurance which may be carried by
Landlord on the Premises or the building of which it is a part, resulting from
the acts or omission of the Tenant, its agents, servants or employees, or the
use or occupancy of the Premises by the Tenant or from the type of materials or
products stored, manufactured, assembled or sold by Tenant in the Premises,
whether or not Landlord has consented to the same. In determining whether
increased premiums are the result of Tenant’s use of the Premises, a schedule,
issued by the organization making the insurance rate on the property, showing
the various components of such rate, shall be conclusive evidence of the
several items and charges which make up the fire insurance rate on the
Premises.


 


(f) Plate Glass. Tenant shall replace, at the expense of
Tenant, any and all plate and other glass, frames or glazing damaged or broken
from any cause whatsoever in and about the Premises.


 


(g) Boiler Insurance. Tenant hereby
agrees, at Tenant’s expense and during the entire Term hereof, to obtain and
keep in full force and effect a policy of boiler broad form insurance, if any
is applicable, in the amount of One Hundred Fifty Thousand Dollars
($150,000.00). The insurance shall be with an insurance company approved by
Landlord and a copy of die policy or certificate of insurance shall be
delivered to Landlord no later than the Commencement Date hereof.


 


(h) Waiver of Subrogation. Landlord
and Tenant each hereby waive any and all rights of recovery against the other
or against the officers, employees, agents and representatives of the other,
oil account of loss or damage occasioned to such waiving party or its property
or the property of others under its control, to the extent that such loss or
damage is insured against under any fire and extended coverage insurance policy
which either may have in force at the time of such loss or damage. Tenant
shall, upon the policies of insurance required under this Lease, give notice to
tile insurance carrier or carriers that the foregoing mutual waiver of
subrogation is contained in this Lease and such waiver shall only be effective
so long as consented to by the insurance carrier or carriers.


 


(i) Form of Policies. All policies
shall be written in a form satisfactory to Landlord and shall be maintained
with insurance companies holding a “General Policyholder’s Rating” of A, and a
financial rating of X, or better, as set forth in the most current issue of
“Best’s Insurance Guide”. Insurance policies carried by Tenant hereunder shall
(i) name Landlord and if requested, Landlord’s lenders) as an additional
insured and provide certificate(s) of insurance thereof to Landlord’s lenders)
if applicable, (ii) be ant occurrence policy (or policies), (iii) specifically
cover the liability assumed by Tenant under this Lease including, but not
limited to, Tenant’s obligations under Section 8.4 and Section 12.7 hereof,
(iv) be primary insurance as to all claims thereunder and provide that any
insurance carried by Landlord is excess and noncontributing with any insurance required of Tenant, and (v) contain a cross-liability
endorsement or severability of interest clause acceptable to Landlord. Tenant
shall deliver to Landlord and Landlord’s lenders) if applicable copies of
policies or original certificates evidencing the existence of the amounts and
forms of coverage satisfactory to Landlord. No such policy shall be cancelable
or reducible in coverage except alter thirty (30) days’ prior written notice to
Landlord. Tenant shall, within ten (10) days prior to the expiration of such
policies, furnish Landlord with renewals or “binders” thereof, or Landlord may
order such insurance and charge the cost thereof to Tenant as Additional Rent.
Notwithstanding anything to the contrary contained herein, Tenant’s obligation
to carry insurance may be satisfied by coverage under a so-called “blanket
policy” or policies of insurance; provided, however, that all insurance
certificates provided by Tenant to Landlord pursuant to Section 4.6 herein
shall reflect that Tenant has been afforded coverage specifically with respect
to the Premises, Landlord and Landlord’s mortgagee(s) or beneficiary(ies) shall
be named as additional insured’s as their interests may appear, the coverage
afforded Landlord shall not be reduced or diminished and the requirements set
forth in this Lease shall be otherwise satisfied by such blanket policy or
policies.


 


Section 4.7       Interest
on Past Due Obligations. Any amount owed by Tenant to Landlord which is not
paid when due shall bear interest from the due date of such amount at the lower
of (i) ten percent (10°/”) per annum, or (ii) the maximum legal interest rate
permitted by law. However, interest shall not be payable on late charges to be
paid by Tenant under this Lease. The payment of interest oil such amounts shall
not excuse or cure any default by Tenant under this Lease.


 


6

















 


Section 4.8  Collection
of Operating Costs. Landlord shall have the right to collect Tenant’s pro
rata share (as defined in Section 4.5(a)) of Operating Costs and all other
charges provided for under this Article IV including, without limitation,
insurance premiums and Real Property Taxes, on a monthly basis. Such amounts
shall be based on Landlord’s reasonable estimate of the costs, charges or
premiums next due, and shall be paid by Tenant as Additional Rent upon the
basis and at the times described herein. Landlord shall provide to Tenant a yearly
expense estimate statement (hereinafter “Estimate Statement”) which shall set
forth Landlord’s reasonable estimate of the total amount due from Tenant for
the current or next ensuing Lease Year for Operating Costs. Tenant shall pay to
Landlord with each installment of Minimum Monthly Rent an amount equal to
one-twelfth (1/12th) of the estimated amount due from Tenant as set forth ire
the Estimate Statement. At anytime during any Lease Year, Landlord may provide
a new Estimate Statement to Tenant indicating any additional amount due from
Tenant and Tenant agrees to pay such amount to Landlord within fifteen (15)
days after notification of the amount of the deficiency. Tenant’s failure to
pay such deficiency to Landlord within such fifteen (15)-day period shall
constitute a breach of this Lease and entitle Landlord to any and all remedies
available under this Lease and applicable law. Such estimated payments shall be
paid to Landlord with no obligation to pay the Tenant interest thereon. Within
a reasonable period  of time after the end of each Lease Year
hereunder, Landlord shall give to Tenant a year-end statement (hereinafter
“Annual Statement”) which shall indicate all of the Operating Costs and other
amounts due from Tenant hereunder for the previous Lease Year, and the amounts
paid by Tenant relating thereto. If the amount paid by Tenant is less than the
amount owed by Tenant, Tenant agrees to pay such deficiency to Landlord within
fifteen (15) days after receipt of the Annual Statement. If the amount paid by
Tenant for the prior Lease Year exceeds the amount required to be paid by
Tenant, such overage shall be credited to amounts due from Tenant for the next
Lease Year. Landlord’s failure to provide such Annual Statement to Tenant as
provided above shall in no way excuse Tenant from its obligation to pay any
such additional amount of Operating Costs or constitute a waiver of Landlord’s
right to collect such Operating Costs from Tenant in accordance with this
Section 4.8. If Tenant defaults under this Lease, Landlord may apply any funds
in the impound account to any obligation then due under this Lease without
waiving any outer remedy available under the Lease or applicable law.


 


Tenant and its agents (provided such agent(s)
shall in no event be compensated on a contingency fee basis) will have the
right to examine Landlord’s books and records relating to Operating Costs, at
Landlord’s office, and after providing at least fifteen (15) days prior written
notice to Landlord, according to this section so long as (a) there is no breach
of or event of default under the Lease at the time that the Tenant examines
Landlord’s books and records; (b) Tenant’s has fully and promptly paid its
Minimum Monthly Rent and Additional Rent (hereinafter “rent”), including its proportionate
share of Operating Costs; (c) Tenant, its agents and contractors agree that
they wilt not divulge the contents of Landlord’s books and records, or the
result of their examination; (d) Tenant, its agents and contractors agree that
they will give Landlord, at tro cost, a copy of their draft and final reports
of their examination of Landlord’s books and records; (e) Tenant requests the
examination of Landlord’s books and records within one (1) year after receipt
of the statement of Operating Costs with regard to which Tenant wishes to
examine Landlord’s books and records; (I) Tenant has not examined Landlord’s
books and records within the twelve (12) months preceding Tenant’s request; and
(g) Tenant shall not have the right to examine any books or records that
contain trade secrets (i.e. leases of other tenants, rent rolls, etc.). If
Tenant’s examination reveals that it has overpaid its proportionate share of
Operating Costs, then the overpayment credit will be applied to the next
accruing rent under the Lease. Tenants sole remedy in the event of an
overpayment will be the credit against its rent. Tenant will not have the right
to terminate cite Lease on account of an overpayment. Tenant will not have the
right to challenge Landlord’s methodology in any examination if it has not
previously challenged that methodology. If Tenant’s examination reveals that it
has underpaid its proportionate share of Operating Costs, then the underpayment
amount will be paid along with the next accreting rent tinder the Lease.


 


ARTICLE V


RECORDS AND BOOKS OF ACCOUNT


 


Section 5.1                      Intentionally
Omitted.


 


Section 5.2                      Intentionally
Omitted.


 


ARTICLE VI


AUDIT


 


Section 6.1                       Intentionally
Omitted.


 


Section 6.2                      Intentionally
Omitted.


 


ARTICLE VII


CONSTRUCTION OF PREMISES


 


Section 7.1       Landlord
and Tenant Improvements. If construction of the improvements on the
Premises have not been completed by the date of this Lease, Landlord shall, at
its cost and expense, pursue to completion the improvements to be erected by
Landlord “Landlord’s Work” as shown on the attached Exhibit “B” labeled
“Construction of the Premises.” Tenant shall commence the construction of
certain site work, building, installation of fixtures, equipment and shall
perform any of “Tenant’s Work” in Tenant’s improvement drawings approved by
Landlord or as set forth on said Exhibit “B,” promptly upon substantial
completion of Landlord’s work on the Premises and shall diligently pursue such
construction, installation and performance to completion. If the Landlord


 


7

















 


performs any such installation or construction
shown in Tenant’s drawings, approved by Landlord or on Exhibit “B” as the
Tenant’s Work, the Tenant shall pay any cost or expense of the Landlord so
incurred within fifteen (15) days after receipt of a bill therefore. Said bill will  be based upon Landlord’s costs and expenses
plus supervision, and architectural expenses, if any.


 


Tenant
shall deliver plans and specifications with respect to Tenant’s site, building,
and leasehold improvements to Landlord or Landlord’s architect within the time
frame set forth in Exhibit B. Said plans and specifications shall conform in
all respects
with the agreements of
Landlord and Tenant as outlined in Exhibit “B” hereto.


 


Landlord
shall have the right but not the obligation to perform, on behalf of and for
the account of Tenant, subject to reimbursement of the cost thereof by Tenant,
any and all of the Tenant’s Work which Landlord determines, in its sole
discretion, should be performed immediately and on an emergency basis for the
best interest of the Shopping Center, or as required by any governmental entity
or required for compliance with any manufacturer’s warranty, including without
limitation, work which pertains to structural components, mechanical, sprinkler
and general utility systems, rooting and removal of unduly accumulated
construction material and debris.


 


Section 7.2       Parking
Facilities. Except for certain improvements on Pad F to be constructed by
Tenant at Tenant’s sole expense, Landlord shall construct or shall have
constructed upon the Shopping Center, at its own cost, access roads, sidewalks
and parking lots or facilities substantially as shown on the Site Plan attached
as Exhibit “A”, subject to making changes thereto as described in Section 1.4.


 


Section 7.3       Changes
and Additions to Buildings. Landlord reserves the right to construct other
buildings or improvements in the Shopping Center from time to time and to make
alterations thereof
or additions thereto and to build
additional stories on any such building or buildings and to build adjoining
same. Easements for light and air are not included in the leasing of the Premises toTenant.


 


Section 7.4       Intentionally
Omitted.


 


Section 7.5       Right
to Adjust. The purpose of the Site Plan attached hereto as Exhibit “A” is
to show the approximate location of the Premises. Notwithstanding any other
provision contained in this Lease, Landlord reserves the right at any time to relocate, vary and adjust the size of
the various buildings, the location of any tenant, excluding Tenant, automobile
parking areas, and other Common Areas shown on the Site Plan, however, in no
event shall any such change be made by Landlord to Tenant’s Construction Area
without Tenant’s written consent, and Landlord shall not materially alter the
size or location of the Premises from the general location reflected on the
Site Plan attached hereto.


 


Section 7.6  Intentionally
Omitted.


 


ARTICLE VIII


USE OF PROPERTY


 


Section 8.1       Permitted
Uses. Tenant shall use the Premises only for the Permitted Use set forth in
Section 1.8 above, and for no other use or purpose, without Landlord’s written
consent, to be given or withheld in Landlord’s sole and absolute discretion.


 


Section 8.2                    Manner of Use.


 


(a)
Interference with Use/Nuisance. Tenant shall not do
or permit anything to be done in or about the Premises which will in any way
obstruct or interfere with or infringe on the rights of other occupants or
customers of the Shopping Center, or injure or annoy them, or use or allow the
Premises to be used for any improper, immoral, or objectionable purposes; nor
shall Tenant cause, maintain or permit any nuisance in, on or about the Premise or  commit or suffer to be committed any waste in,
on or about the Premises. Tenant shall not be liable to Landlord for any other
occupant’s failure to so conduct itself


 


(b)
Violation of Law/Insurance Provisions. Tenant shall
not do or permit to be done in or about the Premises, nor bring, keep or permit
to be brought or kept therein, anything which is prohibited by or will in any
way conflict with any taw, statute, ordinance or governmental rule or
regulation now in force or which may hereafter be enacted or promulgated, or
which is prohibited by any standard form of fire insurance policy or will in
any way increase the existing rate of or affect any fire or other insurance
upon the building or any pall thereof or any of its contents, or cause a
cancellation of any insurance policy covering the building or any part thereof
or any of its contents. Tenant shall comply with all governmental laws,
ordinances and regulations applicable to flue Premises, and the requirements of
any Board of Fire Underwriters or other similar body now or hereafter
instituted, with any order, directive or certificate of occupancy issued
pursuant to any law, ordinance or regulation by any public officer insofar as
the same relates to or affects the condition, use or occupancy of the Premises
including, but not limited to, (1) requirements of structural changes related to
or affected by Tenant’s acts, occupancy or use of the Premises, and (ii) any
and all requirements relating to the Premises imposed by applicable law
including, but not limited to, modifications of existing portions of the
Premises required under the Americans with Disabilities Act or any other
applicable laws, all at Tenant’s sole expense. The judgment of any court of
competent jurisdiction or the admission of Tenant in any action against
Landlord, whether or not Tenant is a party to such action, shall be conclusive
in establishing such violations between Landlord and Tenant


 


(c)Permits. Tenant shall obtain and pay for all permits specifically
including, but not limited to, a certificate of occupancy, required for
Tenant’s occupancy of the Premises and shall promptly take all substantial and
nonsubstantial


 


8

















 


actions necessary to comply with all
applicable statutes, ordinances, rules, regulations, orders and requirements
regulating the use by Tenant of the Premises, including the Occupational Health
and Safety Act and the Americans With Disabilities Act.


 


(d)
Store Operation. Tenant shall continuously operate one
hundred percent (100%) of the Premises during the entire Term of this Lease on
the days and during the hours provided below with due diligence and efficiency
so as to maximize the gross receipts which may be produced by such manner of
operation. Tenant shall conduct its business in the Premises during the regular
customary clays and hours for such type of business in the city or trade area
in which the Shopping Center is located.


 


(e) Change of Name. Tenant agrees not to change the advertised name
of the business operated in the Premises without the prior written consent of
Landlord, which shall not be unreasonably withheld.


 


(t)
Solici4ition of Business. Tenant and Tenant’s
employees and agents shall not solicit business in tile parking or other Common
Areas, nor shall Tenant distribute any handbills or other advertising matter in
automobiles parked in the parking area or in other Common Areas.


 


Section 8.3       Competitive
Business. Neither Tenant nor any Affiliate (as defined below) of Tenant
shall directly or indirectly, own, manage, operate, or have any interest in,
any business that is similar to, or competitive with, the business permitted
under this Lease if such business is located within three (3) miles of any
point oil the perimeter of the Shopping Center. For the purposes of this
Section 8.3, “Affiliate” shall mean any affiliate, subsidiary, parent, company
controlled by parent, successor, predecessor, assignee, shareholder, partner,
member, officer, director, manager, employee, lender, or any other entity
having an interest whatsoever in Tenant. If Tenant shall breach tile foregoing
covenants, or an Affiliate (as defined above), is operating in violation
hereof, Landlord, in addition to but not in lieu of or in limitation of any
other right and remedy available to Landlord under this Lease or at law or in
equity, shall have the right to: (i) Seek injunctive relief to restrain or stop
Tenant from breaching this Section 8.3; (ii) Terminate this Lease in accordance
with the provisions of Article XVI of this Lease; (iii) intentionally omitted;
or (iv) Cancel any option to extend the term of this Lease that may exist at
the time of Tenant’s breach of this Section 8.3.


 


Section 8.4       Indemnification
of Landlord/Tenant.


 


(a) Indemnification of Landlord.
Tenant shall indemnify, defend and hold Landlord harmless from and against any
and all actions, claims, damages, liens, liabilities, costs and expenses in
connection with loss of life, personal injury and/or damage to property arising
from or out of any occurrence in, upon or about the Premises, or tile occupancy
or use by Tenant of the Premises or any part thereof, or occasioned wholly or
in part by any act or omission Tenant, its agents, contractors, employees,
servants, tenants or concessionaires. Tenant shall further indemnify, defend
and hold Landlord harmless from and against any and all actions, claims, damages,
liens, liabilities, costs and expenses arising from any breach or default in
performance of any obligation on Tenant’s part to be performed under die terns
of this Lease, or arising from any act, neglect, fault or omission of Tenant or
its agents, contractors, employees, servants, tenants or concessionaires, and
from and against all costs, attorneys’ fees, expenses and liabilities incurred
in connection with such claim or any action or proceeding brought thereon. In
case any action or proceeding shall be brought against Landlord by reason of
any such claim, Tenant upon notice from Landlord shall defend the same at
Tenant’s expense by counsel approved in writing by Landlord. Tenant, as a
material part of the consideration to Landlord, hereby waives all claims
against Landlord for and assumes all risk of damage to property or injury to
persons in, upon or about the Premises from any cause whatsoever except as
caused solely by Landlord’s gross negligence or willful misconduct.


 


(b)  Indemnification of Tenant.
Landlord will indemnify Tenant, and hold it harmless from,, any and all
claims, actions, damages, liability, and expense arising from or out of any
occurrence in the Common Areas. If any action or proceeding is brought against
Tenant, by reason of any such claim, Landlord, upon notice from Tenant, will
defend the claim at Landlord’s expense with counsel reasonably satisfactory to
Tenant. Landlord’s indemnification of Tenant shall in no event apply to claims
(i) that are caused by the failure of Tenant to observe any of the terms and
conditions of this Lease, (ii) any claims that are covered or should be covered
by Tenant’s workers compensation insurance carried by Tenant or required to be
carried by Tenant pursuant to this Lease; and (iii) Tenant’s negligence or
intentional misconduct.


 


Section 8.5       Landlord’s
Access. Landlord and its agents may enter the Premises at all reasonable
times to show the Premises to potential buyers, investors, tenants and other
parties, or for any other purpose Landlord deems necessary. Landlord shall give
Tenant prior written notice of such entry, except in the case of an emergency.
Landlord may place customary “For Sale” or “For Lease” signs oil the Premises.


 


Section 8.6       Excavation.
If all excavation shall be made upon land adjacent to or under the Premises, or
shall be authorized to be made, Tenant shall afford to the person causing or
authorized to cause such excavation, license to enter upon the Premises for die
purpose of doing such work as Landlord shall deem necessary to preserve the
wall or the building of which the Premises
form a part from injury or damage
and to support the same by proper foundations, without any claim for damages or
indemnification against Landlord or diminution or abatement of rent.


 


Section 8.7       Quiet
Possession. If Tenant pays the rent and complies with all other terms of
this Lease, Tenant may occupy and enjoy die Premises for the full Term, subject
to the provisions of this Lease and to any mortgages, deeds of trust and other
recorded instruments encumbering tile Premises and/or Shopping Center.


 


Section 8.8       Intentionally
Omitted.


 


9

















 


ARTICLE IX

HAZARDOUS MATERIALS


 


Section 9.1       Prohibition
of Storage. Tenant shall not cause or permit any Hazardous Materials (as
hereinafter defined) to be brought upon, kept or used in or about tile Premises
by Tenant, its agents, employees, contractors or invitees in a manner or for a
purpose prohibited by or which could result in liability under any applicable
law, regulation, rule or ordinance. Tenant shall comply with all affirmative
legal requirements concerning all Hazardous Materials. If Tenant breaches tile
obligation stated in the preceding sentences, or if the presence of Hazardous
Materials on the Premises caused or permitted by Tenant results in a release of
any Hazardous Material, a discharge of a pollutant or contaminant or any other
contamination of tile Premises resulting in a potential violation of or
incurrence of liability under any law, regulation, rule or ordinance, or if
contamination of the Premises by Hazardous Materials otherwise occurs for which
Tenant is legally liable to Landlord for damage resulting therefrom, then
Tenant shall indemnify, protect, defend and hold Landlord, its partners, agents,
employees and contractors harmless from any and all actions, claims, judgments,
damages, penalties, fines, costs, liens, liabilities, injunctive actions or
orders, and losses (including, without limitation, diminution in value of the
Premises and/or Shopping Center, damages for the loss or restriction on use of
rentable or usable space or of any amenity of the Premises, damages arising
from any adverse impact on marketing of space in the Premises and sums paid in
settlement of claims, “response costs” as defined in tile Comprehensive
Environmental Response, Compensation and Liability Act (“CGRCLA”), attorneys’
fees, Consultant fees and expert fees) which arise during or after the Lease
Term as a result of such contamination.


 


Section 9.2       Clean-Un.
This indemnification of Landlord by Tenant pursuant to Section 9.1 above
includes, without limitation, costs incurred in connection with any
investigation of site conditions or any cleanup, remediation, removal, and/or
restoration work required by any federal, state or local governmental agency or
political subdivision because of Hazardous Material present in tile soil or
around water on or under the Premises or emanating from the Premises in breach
or violation of Tenant’s obligations pursuant to Section 9.1 above. Without
limiting the foregoing, if the presence of any Hazardous Materials on the
Premises caused or permitted by Tenant results in any contamination of the
Premises, Tenant shall promptly take all actions at its sole expense as are
necessary to return tile Premises to the condition existing prior to the
introduction of any such Hazardous Materials to the Premises, provided that
Landlord’s approval of such action shall first be obtained, which approval
shall not be unreasonably withheld so long as such actions would not
potentially have any material adverse long-term or short-term effect on the
Premises.


 


Section 9.3       Business.
Landlord acknowledges that it is not the intent of this Section to prohibit
Tenant from operating its business as described above. Tenant may operate its
business so long as the use or presence of Hazardous Materials is strictly and
properly monitored and performed in full compliance with all applicable
governmental requirements. As a material inducement to Landlord to allow Tenant
to use Hazardous Materials in connection with its business, Tenant agrees to
deliver to Landlord prior to the Commencement Date a list identifying each type
of Hazardous Materials to be present on the Premises and setting forth any and
all governmental approvals or permits required in connection with the presence
of Hazardous Materials on the Premises (“Hazardous Materials List”). Tenant
shall deliver to Landlord an updated Hazardous Materials List at least once a
year and shall also deliver all updated list before any new Hazardous Materials
are brought onto the Premises or on or before the date Tenant obtains any
additional permits or approvals. In connection with any Hazardous Materials
utilized by Tenant on tile Premises, Tenant shall be responsible, at its sole
cost and expense, for making any necessity modifications or improvements either
to Premises or Tenant’s equipment as required by applicable laws, or any
governmental agency, Landlord’s insurance company, Landlord’s lender(s),
Landlord’s consultant(s), or prospective purchaser(s). Tenant will, at its sole
cost and expense, promptly upon receipt of written notice from Landlord
complete such improvements. If such work is not promptly undertaken and
completed, Landlord shall have the right, but not the obligation, to complete
such work and to charge such amounts to Tenant as additional rent under this
Lease.


 


Section 9.4   Termination of Lease. Notwithstanding the provisions of Section
9.1 above, Landlord shall have the right to terminate the Lease in Landlord’s
sole and absolute discretion if (i) any anticipated use of the Premises by
Tenant involves the generation of
storage, use, treatment or
disposal of Hazardous Materials in a manner or for a purpose prohibited by any
governmental agency or authority; (ii) Tenant has been required by any lender
or governmental authority to undertake removal or remedial action in connection
with Hazardous Materials oil the Premises if the presence of Hazardous
Materials resulted from Tenant’s action or use of the Premises (unless Tenant
is in full compliance with all requirements connected with such removal or
remedial action); or (iii) Tenant is subject to an enforcement order issued by
any governmental authority in connection with the use, disposal or storage of
Hazardous Materials on the Premises (unless Tenant is in full compliance with
the terms of such enforcement order).


 


Section 9.5       Assignment
and Subletting. Notwithstanding the provisions of Section 9.1 above, if (i)
any anticipated use of the Premises by any proposed assignee or sublessee
involves or reasonably could involve the generation, storage, use, treatment or
disposal of Hazardous Materials in a manner or for a purpose prohibited by any
law, regulation, title or ordinance; (ii) the proposed assignee or sublessee
has been required by a prior landlord, lender or governmental authority to
undertake removal or remedial action in connection with any Hazardous Materials
oil a property if tile presence of the Hazardous Materials resulted from such
party’s action or use of the property in question; or (iii) the proposed
assignee or sublessee is subject to an enforcement order issued by any
governmental authority in connection with the use, disposal or storage of
Hazardous Materials, it shall not be unreasonable for Landlord to withhold its
consent to art assignment or subletting to such proposed assignee or sublessee.
This paragraph shall not preclude other grounds for Landlord’s rejection of a
sublease or assignment pursuant to any other provisions of this Lease.


 


Section 9.6       Landlord’s
Right to Perform Tests. At any time prior to the expiration of the
Term, Landlord shall (rave tire right to enter upon the Premises in order to
conduct appropriate tests of water and soil and to deliver to Tenant the
results of such tests to demonstrate that levels of any Hazardous Materials in
excess of permissible levels has occurred as a result of Tenant’s use of the
Premises. Tenant shall further be solely responsible for and shall defend,


 


10

















 


indemnify and hold the Landlord, its agents
and contractors harmless from and against all claims, costs and liabilities
including actual attorneys’ fees and costs, arising out of or in connection
with any removal, remediation, clean up, restoration and materials required
hereunder to return the Premises and any other property of whatever nature to
their condition existing prior to the appearance of the Hazardous Materials.


 


Section 9.7       Tenant’s
Obligations. Tenant’s obligations under this Article 9 shall survive the
termination and/or expiration of the Lease. During any period of time employed
by Tenant after the termination or expiration of the Lease to complete the
removal from the Premises or the remediation of any such Hazardous Materials, Tenant
shall continue to pay the full rent in accordance with this Lease, which rent
shall be prorated on a daily basis.


 


Section 9.8       Definition
of “Hazardous Materials”. The term “Hazardous Materials” shall mean any
toxic or hazardous substance, material or waste or any pollutant or contaminant
or infectious or radioactive material including, but not limited to, those
substances, materials or wastes regulated now or in the future under any of the
following statutes or regulations promulgated thereto: (1) any “hazardous
substance” within the meaning of the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended (“CERCLA”), 42 U.S.C. §§
9601 et sec .; (2) any “hazardous waste” within the meaning of the
Resource Conservation and Recovery Act, 42 U.S.C. §§ 6901 et seq.; (3) any “hazardous waste” or “extremely hazardous waste” within the
meaning of the laws of the State of Nevada; (4) any “hazardous chemical
substance or mixture” or “imminently hazardous chemical substance or mixture”
within the meaning of the Toxic Substances Control Act, 15 U.S.C. §§ 2601 et
sec.; (5) any “hazardous air pollutant” within the meaning of the Federal Clean
Air Act, 42 U.S.C. §§ 7400 ct sue.;
(G) any “toxic pollutant” or “oil
or hazardous substance” within the meaning of the Federal Water Pollution
Control Act, 33 U.S.C. §§ 1250 et seq.; (7) any “contaminant” within the
meaning of the Safe Drinking Water Act, 42 U.S.C. § 300i; (8) any “chemical
known to the state to cause cancer or reproductive toxicity”; (9) petroleum or
any fraction thereof; (l0) asbestos; or (11) any other substance, chemical
waste, toxicant, pollutant or contaminant regulated by any federal, state or
local law, statute, rule, regulation or ordinance for the protection of health
or the environment.


 


Section 9.9         Landlord’s
Warranty and Indemnification. Landlord represents and warrants to Tenant
that, as of the date of this Lease, except as may be otherwise outlined in that
certain Phase I - Environmental Site Assessment dated May 20, 2003 by Summit
Engineering corporation, a copy of which has been provided to Tenant, Landlord
has no actual knowledge of the presence of any Hazardous Materials oil, in or
under the Premises, in violation of any
Environmental Law. The foregoing representation and warranty is based solely
oil Landlord’s actual knowledge and without any independent investigation of
the Premises, and no constructive or implied knowledge shall be imputed to
Landlord with respect to the foregoing. Landlord shall indemnify Tenant and
hold Tenant harmless from and against any and all losses, liabilities, damages,
injuries, costs, expenses (including reasonable attorneys fees), and claims of
any and every kind whatsoever paid, incurred, suffered by, or asserted against
Tenant for, with respect to, as a result of the
presence on or under, or the escape, seepage, leakage, spillage, emission,
discharge or release from tile premises of any Hazardous Materials occurring
(a) prior to the Lease Commencement Date, or (b) after the Lease Commencement
Date, but only if actively caused by Landlord. Tenant shall promptly provide
notice of any release of any release of any
Hazardous Materials and any claims made by Tenant against Landlord hereunder.


 


ARTICLE X


PARKING AND COMMON USE AREAS AND FACILITIES


 


Section 10.1     Control
of Common Areas by Landlord. “Common Areas” means all areas, space,
equipment and special services provided by Landlord for the common or joint use
and benefit of the occupants of the Shopping Center, their employees, agents,
servants, customers and other invitees, including, without limitation, parking
areas, access roads, driveways, retaining walls, landscaped areas, truck
service-ways or tunnels, loading docks, pedestrian malls, courts, stairs, ramps
and sidewalks, comfort and first aid stations, and parcel pick-up stations. All
Common Areas shall at all times be subject to the exclusive control and
management of Landlord, and Landlord shall have the right from time to time to
establish, modify and enforce reasonable titles and regulations with respect to
the Common Areas. Landlord shall have the right to construct, maintain and
operate lighting facilities oil all Common Areas and improvements; to police
the same; from time to tithe to change the area, level, location and arrangement
of parking areas and other facilities hereinabove referred to; to restrict
parking by tenants, their officers, agents and employees to employee parking
areas; to enforce parking charges only to tile extent required by governmental
or quasi-governmental entities (by operation of meters or otherwise), with
appropriate provisions for free parking ticket validating by tenants; to close
all or any portion of the Common Areas or facilities to such extent as may, in
the opinion of Landlord’s counsel, be legally sufficient to prevent a
dedication thereof or the accrual of any rights to any person or the public
therein; to close temporarily all or any portion of the parking areas or
facilities: to discourage non-customer parking: and to do and perform such other
acts in and to said areas and improvements as, in the use of good business
judgment, the Landlord shall determine to be advisable with a view to the
improvement of the convenience and use thereof by tenants, their officers,
agents, employees and customers. Landlord will operate and maintain the Common
Areas in such manner as Landlord, in its sole discretion, shall determine from
time to time. Without limiting the scope of such discretion, Landlord shall
have the full right and authority to employ ail personnel necessary for the
proper operation and maintenance of the Common Areas and facilities.


 


Section 10.2     License.
All Common Areas and facilities not within the Premises, which Tenant may be
permitted to use and occupy, are to be used and occupied under a revocable
license, and if any such license be revoked, or if the amount of such areas be
diminished, Landlord shall not be subject to any liability nor shall Tenant be
entitled to any compensation or diminution or abatement of rent, or shall such
revocation or diminution of such areas be deemed constructive or actual
eviction.


 


11

















 


Section 10.3     Merchants’
Association. Tenant will become a member of, participate fully in, and
remain in good standing in the Merchants’ Association (if now formed or as soon
as the same has been formed) limited to tenants occupying premises in the
Shopping Center, and abide by the regulations of such Association. Each member
tenant shall have one vote in the operation of said Association. The objects of
such Association shall be to encourage its members to deal fairly and
courteously with their customers, to sell their merchandise or services at fair
prices, to follow ethical business practices, to assist the business of the
tenants by sales promotions and center-wide advertising, and in particular to
help the interests of members of the said Association. The Tenant agrees to pay
cities to the Merchants’ Association as approved by a majority vote of the
members of the Association. Nothing in the Bylaws  or regulations of the said Association shall
be in conflict with the provisions of this Lease, including without limiting
the generality of the foregoing any reasonable rules and regulations adopted
pursuant to the provisions of Section 12.5 hereof, or in any way shall affect the rights of the
Landlord.


 


ARTICLE XI


SIGNS,
AWNINGS, CANOPIES. FIXTURES, ALTERATIONS, IMPROVEMENTS


 


Section 11.1     Signs
and Auctions. No auction, fire or bankruptcy sales may he conducted in the
Premises, and no signs advertising such sales shall be posted on the Premises
without the prior written consent of Landlord.


 


Section 11.2       Installation
by Tenant. Tenant shall not make or cause to be made any alterations,
additions or improvements to the Premises, nor install or cause to be installed
any trade fixtures, exterior signs, exterior machinery, floor covering,
interior or exterior lighting, plumbing fixtures, shades or awnings, or make
any other changes to the Premises without the prior written consent of Landlord.
All fixtures installed by Tenant shall be new or completely reconditioned.
Tenant shall present to the Landlord plans and specifications for such work at
the time approval is sought and prior to commencing the proposed improvements.


 


Section 11.3       Improvements. It is understood and
agreed by Tenant that any anti all leasehold improvements made to the Premises
by Tenant prior to or during the Term, or any extensions thereof, shall be made
by a contractor reasonably approved by Landlord. Landlord hereby approves
Shaver Construction as Tenant’s contractor for construction of Tenant’s Work as
set forth in Exhibit B hereof. In the event Tenant should employ a contractor
other than Shaver Construction or Landlord’s contractor, it is expressly
understood and agreed that Tenant shall first obtain the Landlord’s written
approval of the
Tenant’s contractor and the
terns of the contract. Landlord may require Tenant or Tenant’s contractor to
provide Landlord, at Tenant’s sole cost and expense, a lien and completion bond
in an amount equal to one and one-half (1-1/2) times the estimated cost of such improvements to insure Landlord
against any liability for mechanics’ and materialmen’s liens and to insure
completion of the work, only if such bond is required by Landlord’s lender.
Provided this Lease has not been subject to a Transfer (as defined in Article
XV) Landlord’s prior written consent will not be necessary for any minor interior non-structural alteration,
addition, or improvement that (i) does not involve the storefront, exterior
doors, or windows; (ii) in not visible from outside of the Premises; (iii) is
not located outside of the premises; (iv)  does not adversely affect the operation of the HVAC, plumbing, fire
sprinkler, electric, water, or sewer systems of the Premises, building, or
Shopping Center; or (v) does not include any of Tenant’s initial alterations,
additions, fixtures, and/or improvements which shall require Landlord’s prior
approval as provided in this Lease. Such minor interior non-structural alteration,
addition, or improvement shall further be subject to tile following (a) shall
cost less than Ten Thousand and No/100 Dollars ($10,000.00), including labor
and materials; (b) shall not change the general character of the Premises or
reduce the fair market value of the Premises below its fair market value prior
to the alteration, addition, or improvement; (c) shall be made with due
diligence, in a good and workmanlike manner, and in compliance with all
applicable laws and ordinances; (d) shall be promptly and fully paid for by
Tenant; and (e) shall if reasonably necessary as determined by Landlord be made
under the supervision of an architect or engineer reasonably satisfactory to
Landlord and in accordance with plans and specifications and cost estimates
approved by Landlord. Landlord may designate a supervising architect to assure
compliance with the provisions of this paragraph, anti if it does, Tenant will
pay the supervising architect’s charges. Promptly after the completion of any
alteration, addition, or improvement, Tenant will give Landlord a copy o f “as
built” drawings of the alteration, addition, or improvement. All alterations,
additions, fixtures, and improvements, whether temporary or permanent in
character, trade in or upon the Premises by Tenant, will immediately become
Landlord’s property and, at the end of the Term of this Lease, will remain out
the Premises without compensation to Tenant. Prior to commencing any such
interior non­structural alteration, addition, or improvement, Tenant shall
provide not less than ten (10) days prior written notice to Landlord describing
the contemplated work; and the estimated costs; name, address, telephone
number, contractor license, and insurance information of any persons or firms
performing such work.


 


Section 11.4     Non-Removal
by Tenant. All alterations, additions and improvements, including signs and
sign cases, made by Tenant, or made by the Landlord out the Tenant’s behalf
anti for which Tenant has paid Landlord in accordance with this Lease, shall
remain the property of the Tenant for the term of the Lease, or any extension
or renewal thereof. Such alterations, additions and improvements shall not be
removed from the Premises. At the expiration or termination of this Lease Term,
or any extensions or renewals thereof, all such alterations, additions and
improvements become the property of the Landlord.


 


Section 11.5  Intentionally Omitted.


 


Section 11.6     Liens.
Tenant shall keep the Premises, any building of which the Premises are a part,
and the Shopping Center free from any and all liens arising out of work
performed, materials furnished or obligations incurred by Tenant and shall
indemnify, hold harmless and defend Landlord from any liens and encumbrances
arising out of any work performed or materials furnished by, or at the
direction of, Tenant. In the event that Tenant shall not, within twenty (20)
clays following the imposition of any lien, cause such lien to be released of
record by payment or posting of


 


12

















 


a proper bond, landlord shall have, in
addition to all other remedies provided herein and by law, the right, but not
the obligation, to cause the same to be released by such means as it shall deem
proper, including payment of the claim giving rise to such lien. All such sums
paid by Landlord and all expenses incurred by it its connection therewith shall
bear interest at the rate of ten percent (10”‘/ei) per annum from the date
expended until the date repaid. Landlord shall have the right at all times to
post and keep posted on the Premises any notices permitted or required by law,
or which Landlord shall deem proper, for the protection of Landlord and the
Premises, and any other party having an interest therein from mechanics’ and
materialmen’s liens, and Tenant shall give to Landlord at least fifteen (15)
business days prior written notice of the expected date of commencement of any
work relating to alterations or additions to the Premises.


 


Section 11.7     Signs,
Awnings and Canopies. Tenant will not place or stiffer to be placed or
maintained on any exterior door, wall or window of the Premises any sign,
awning or canopy, or advertising matter or other thing of any kind, and will
not place or maintain any decoration, lettering or advertising matter on the
glass of any window or door of the Premises without first obtaining Landlord’s
written approval and the approval and consent of any governmental body having
jurisdiction over signs in the Shopping Center. Tenant further agrees to
maintain such signs, awnings, canopy, decorations, lettering or other
advertising matter as may be approved, in good condition and repair at all
times. Tenant also agrees, at Tenant’s sole cost, to obtain a canopy type sign
or signs which shall be in strict conformance with Landlord’s sign criteria as
to design, material, color, location, size and letter style. ALL SIGNS  MUST BE FABRICATED AND INSTALLED A CONTRACTOR SELEC’1’ED BY LANDLORD. Landlord
may further require Tenant to reimburse Landlord for the cost of an under canopy
sign and bracket provided by Landlord to Tenant without sign copy. Tenant shall
make arrangements at Tenant’s sole expense to have copy applied to such under
canopy sign by Landlord’s designated contractor at Tenant’s sole expense.
Landlord, at Landlord’s sole and absolute discretion, may designate one (1) or
more contractors as the exclusive, provider(s) of sign fabrication and/or
installation services. Prior to authorizing Landlord’s contractor to construct
any sign, a detailed drawing of the proposed sign shall be prepared by the
Landlord’s contractor at the sole expense of the Tenant, and submitted to the
Landlord and Tenant for written approval. All signs and sign cases are to be
considered fixtures and improvements and become the property of the Landlord
upon expiration or termination of this Lease.


 


ARTICLE XII


CONDITION OF PROPERTY: MAINTENANCE, REPAIRS AND ALTERATIONS


 


Section 12.1     Existing
Conditions. Tenant accepts the Premises in its condition as of the
execution of this Lease, subject to all recorded matters, laws, ordinances, and
governmental regulations and orders. Tenant acknowledges that neither Landlord
nor any agent of Landlord has made any representation as to tile condition of
the Premises or tile suitability of tile Premises for Tenant’s intended use.


 


Section 12.2     Exemption
of Landlord front Liability: Waiver. Landlord shall not be liable for any
damage or injury to the person, business (or any loss of income therefrom),
goods, wares, merchandise or other property of Tenant, Tenant’s employees,
invitees, customers or any other person in or about the Premises, whether such
damage or injury is caused by or results front: (a) fire, deans, electricity,
water, gas or rain; (b) tile breakage, leakage, obstruction or other defects of
pipes, sprinklers, wires, appliances, plumbing, air conditioning or lighting
fixtures or any other cause; (c) conditions arising in or about the Premises or
upon other portions of any building of which the Premises is a part, or from
other sources or places; (d) any act or omission of any other tenant or
occupant of the Shopping Center or of any building of which the Premises is a
part; or non-related claims. Landlord shall not be liable for any such damage
or injury even though the cause of or the means of repairing such damage or
injury are not accessible to Tenant. Tenant, as a material part of the
consideration to be rendered to Landlord, hereby waives all claims against
Landlord for the foregoing damages from any cause arising at any time. The
provisions of this Section 12.2 shall not, however, exempt Landlord from
liability for Landlord’s gross negligence or willful misconduct.


 


Section 12.3              Tenant’s Obligations.


 


(a) Tenant agrees at all
times, at its own cost and expense, to repair, maintain in good and tenantable
condition and replace, as necessary, die Premises and every part thereof
including, without limitation, the following: all meters, pipes, conduits,
equipment, components and facilities that supply the Premises exclusively with
utilities (except if the appropriate utility company has assumed these duties)
or that form an air conditioning system exclusively servicing the Premises, all
fixtures and other equipment installed in the Premises; all exterior and
interior glass installed in the Premises; the store front(s), all signs (see
Section 12.4), locks and closing devices; all window sashes, casements and
frames; doors and door frames; floor coverings; and all such items of repair, maintenance, alteration, improvement or reconstruction as may be
required at any time or from time to time by any governmental agency !saving
jurisdiction thereof Landlord shall also have the right, but not the obligation
to paint/stain/varnish or otherwise refinish Tenant’s store front, window
sashes, casements, frames, doors and door jams with Landlord having the right,
but not the obligation to include all such costs as ail Operating Cost under
Section 4.5 hereof. Tenant shall promptly replace any portion of the Premises or system or equipment in tile Premises which cannot be
fully repaired, regardless of whether the benefit of such replacement extends beyond the Lease Tern. Tenant shall obtain a
preventive maintenance contract providing for the regular inspection and
maintenance of the heating and air conditioning system (including leaks around
ducts, pipes, vents, or other parts of the air conditioning) by a licensed
heating and air conditioning contractor. The cost thereof shall be borne solely
by Tenant. It is the intention of Landlord and Tenant that, at all times during
the Lease Term, Tenant shall maintain tile Premises in an attractive,
first-class and fully operative condition.


 


(b) All of Tenant’s
obligations to maintain and repair shall be accomplished at Tenant’s sole
expense. If Tenant refuses or neglects to repair properly as required hereunder
and to the reasonable satisfaction of Landlord, Landlord may, on ten (10) days’
prior notice (except that no notice shall be required in case of emergency)
enter the Premises and


 


13

















 


perform such repair and maintenance on behalf
of Tenant without liability to Tenant for any loss or damage that may accrue to
Tenant’s merchandise, fixtures, or other property or to Tenant’s business by
reason thereof, and upon completion thereof, Tenant shall pay Landlord’s costs
for making such repairs plus twenty percent (20°/o) for overhead, upon
presentation of a bill therefore, as Additional Rent. Such bill shall include
interest at ten percent (10%) per annum on the costs incurred by Landlord from
the date of completion of repairs by Landlord to the date paid by Tenant.


 


Section 12.4    Landlord’s Obligations. Subject to the provisions of Section 12.3
(Tenant’s Obligations), Article XIII (Damage or Destruction), Article XIV
(Condemnation), and Article X (Parking and Common Use Facilities), Landlord
shall repair, maintain, and replace, as necessary, the roof, exterior walls,
structural parts of the Premises and all meters, pipes, conduits, equipment,
components and facilities that supply the Premises with utilities on a
nonexclusive basis (except to the extent the appropriate utility company has
assumed these duties); provided, however, that Landlord shall not be required
to make repairs necessitated by reason or the negligence of
Tenant or anyone claiming under Tenant, by reason of the failure of Tenant to
perform or observe any conditions or agreements of this Lease, or by reason of
any improvements made by Tenant or anyone claiming under Tenant. Any and all
such costs and expenses of Landlord shall lie an Operating Cost under Section
4.5 hereof. ‘tenant waives the benefit of any other present or future law which
may give the Tenant the right to repair the Premises at Landlord’s expense, to
offset the cost of any repairs performed Tenant against rent, or to terminate
the Lease due to the condition of the Premises.


 


Section 12.5     Rules
and Regulations.


 


(a)
The Tenant agrees as follows:


 


(1)
All garbage and refuse shall be kept in the kind of container
specified by Landlord, and shall be placed outside of the Premises in specified
trash containers prepared for collection in the manner and at the times and
places specified by Landlord. If Landlord shall provide or designate a service
for picking tip refuse and garbage, Tenant shall use same at
Tenant’s cost. Tenant shall pay the cost of removal of Tenant’s refuse and
rubbish.


 


(2)           No aerial or antennae shall be
erected on the roof or exterior walls of the Premises, or at any location
within the Shopping Center, without the prior written consent of the Landlord
which shall not be unreasonably withheld provided such aerial or antennae is
not visible from the ground. Any aerial or antennae installed without
Landlord’s consent shall be subject to removal without notice at any time.


 


(3)           No loudspeakers, televisions,
phonographs, radios, or other devices shall be used in a manner so as to be
heard or seen outside of the Premises without the prior written consent of the
Landlord.


 


(4)           The sidewalk areas immediately
adjoining the Premises shall be kept clean and free from dirt and rubbish by
the Tenant to the satisfaction of the Landlord, and Tenant shall not place or
permit any obstruction or materials in such areas. No exterior storage or sales
shall be allowed without Landlord’s prior written consent.


 


(5)           Tenant and Tenant’s employees shall
park only the number of cars approved and only in those portions of the parking
area designated for that purpose by Landlord.


 


(6)           The plumbing facilities shall not be
used for any other purpose than that for which they are constructed, and no
foreign substance of any kind shall be thrown therein, and the expense of any
breakage, stoppage, or damage resulting from a violation of this provision
shall be borne by Tenant, who shall, or whose employees, agents or invitees
shall have caused it.


 


(7)           Tenant shall use at Tenant’s cost
such pest extermination contractor as Landlord may direct and at such intervals
as Landlord may require.


 


(8)          Tenant shall not burn any trash or
garbage of any kind in or about the Premises, or Shopping Center.


 


(9)           Tenant shall warehouse, store and/or
stock in the Premises only such goods, wares and merchandise as Tenant intends
to offer for sale at retail at, in, from or upon the Premises. This shall not
preclude occasional emergency transfers of merchandise to the other stores of
Tenant, if any, not located in the Shopping Center. Tenant shall use for
office, clerical or other non-selling purposes only such space in the Premises
as is from time to time reasonably required for Tenant’s business in the Premises.


 


(10)         Tenant shall not cause or permit any
odors to be emitted from the Premises which do or may in Landlord’s judgment
affect other tenant’s or patrons of the Shopping Center. Tenant agrees and
acknowledges that if Tenant violates the foregoing provision and Landlord
receives complaints from other tenants(s) or visitor(s) of the Shopping Center,
then Landlord shall have the right to determine what corrective measures are
required and all such corrective measures shall be immediately undertaken by Tenant
at Tenant’s sole cost and expense after receipt of notice of the required
corrective measures from Landlord. If Tenant does not comply, Landlord shall
have the right, but not the obligation, to cause such corrective measures to be
implemented and charge any and all costs thereof to Tenant as additional rent
due under this Lease.


 


(b)               Landlord reserves the right from
time to time to amend or supplement the foregoing rules and regulations, and to
adopt and promulgate additional rules and regulations applicable to the
Premises. Notice of such rules and regulations and amendments and supplements
thereto, if any, shall be given to the Tenant and Tenant agrees to comply with
all such rules and regulations upon receipt of notice. Landlord shall not be
liable in any way to Tenant for any damage or inconvenience
caused by any other tenant’s non-compliance with these rules and regulations.


 


14

















 


Section 12.6     Condition
Upon Termination. Upon the expiration or early termination of this Lease,
‘tenant shall surrender the Premises to Landlord, broom clean and in the same
condition as received except for ordinary wear and tear which Tenant was not
otherwise obligated to remedy under any provision of this Lease. However, Tenant
shall not be obligated to repair any damage which Landlord is required to
repair under Article XIII (Damage or Destruction). All alterations, additions
and improvements shall be surrendered to Landlord upon the termination of this
Lease, except that Tenant tray remove any of Tenant’s trade fixtures, machinery
or equipment which can be removed without material damage to the Premises.
Tenant shall repair, at Tenant’s expense, any damage to the Premises caused by
the removal of any such trade fixtures, machinery or equipment. In no event,
however, shall Tenant remove any of the following materials or equipment
without Landlord’s prior written consent: any power wiring or power panels;
lighting or lighting fixtures; wall coverings; drapes, blinds or other window
coverings; carpets or other floor coverings; heaters, air conditioners or any
other heating or air conditioning equipment; fencing or security gates; or
other similar building operating equipment and decorations.


 


Section 12.7              Monitoring, Inspection, and Remediating Mold.


 


(a)
Monitoring of Premises. Tenant, at its sole cost and expense, shall: (i)
Regularly monitor the Premises for the presence of mold or for any conditions
that reasonably can be expected to give rise to mold (the “Mold Conditions”),
including, but not limited to, observed or suspected instances of water damage,
mold growth, repeated complaints of respiratory ailment or eye irritation by
Tenant’s employees or any other occupants in the Premises, or any notice from a
governmental agency of complaints regarding the indoor air quality at the
Premises; and (ii) Promptly notify Landlord in writing if it suspects mold or Mold Conditions at the Premises.


 


(b)
Inspection of Premises. In the event of suspected mold or Mold
conditions at the Premises, ‘tenant, at its sole cost and expense, shall
promptly cause all inspection of the Premises to be conducted, during such time
as Landlord may designate, to determine if mold or Mold Conditions are present
at the Premises, and shall: (i) Notify Landlord, in writing, at least five (5)
days prior to the inspection, of the date out which the inspection shall occur,
and which portion of the Premises shall be subject to the inspection; (ii)
Retain all industrial hygienist certified by the American Board of Industrial
Hygienists (“CIH”) or all otherwise qualified mold consultant (generally, “Mold
Inspector”) to conduct die inspection; and (iii) Cause such Mold Inspector to:
(A) Obtain or maintain errors and omissions insurance coverage with terms and
limits customarily maintained by Mold Inspectors, adding Landlord as all
additional insured with respect to Landlord’s vicarious liability, and provide
to Landlord evidence of such coverage and a copy of the endorsement granting
Landlord additional insured status; (B) Perform the inspection in a manner that
is strictly confidential and consistent with the duty of care exercised by a
Mold Inspector; and (C) Prepare all inspection report, keep the results of the
inspection report confidential, and promptly provide a copy to Landlord.


 


(c)
Remediation of Mold. Iii the event the inspection required by Paragraph
(b) hereof determines that mold or Mold Conditions are present at the Premises
and provided mold or Mold Conditions were not caused by the gross negligence or
willful misconduct involving all act or failure to act by Landlord or its
agents or contractors, then Tenant, at its sole cost and expense, shall
promptly: (A) Hire trained and experienced mold remediation contractors to
prepare a remediation plan and to remediate the mold or Mold Conditions at the
Premises; (B) Send Landlord notice, in writing, with a copy of the remediation
plan, at least five (5) days prior to the mold remediation, stating: (1) The
date on which the mold remediation shall start; (2) Which portion of the
Premises shall be subject to the remediation; (3) The name, address, and
telephone number of the certified mold remediation contractors performing the
remediation; (4) The remediation procedures and standards to be used at the
Premises; (5) The clearance criteria to be employed at the conclusion of the
retuediation; and (6) The date the remediation will conclude; (C) Notify, in
accordance with any applicable federal, state or local health or safety
requirements, its employees as well as occupants and visitors of the Premises of the nature, location,
and schedule for the planned mold remediation; (D) Ensure that the mold
remediation is conducted in accordance with the relevant provisions of the
document Mold
Remediation in Schools and Commercial Buildings (EPA 402-K-O1-001, March 2001) (“EPA
Guidelines”), published by the U.S. Environmental Protection Agency, as may be
amended or revised from time to time, or any other applicable, legally binding
federal, state, or local laws, regulatory standards or guidelines; and (1:)
Provide Landlord with a draft of the
molts remediation report and give Landlord a reasonable opportunity to review
and comment thereon, and when such report is finalized, promptly provide
Landlord with a copy of the final remediation report.


 


(d)
Post-Remediation Inspection. Tenant acknowledges and agrees that
Landlord and/or Landlord’s agents shall have a reasonable opportunity to
inspect the remediated portion of the Premises after the conclusion of the mold
remediation. If the results of Landlord’s inspection indicate that the
remediation does not comply with the final remediation report or any other
applicable federal, state, or
local laws, regulatory standards or guidelines, including, without limitations,
the EPA Guidelines, then Tenant, at its sole cost and expense, shall
immediately take all further actions necessary to ensure such compliance.


 


ARTICLE XIII

DAMAGE OR DESTRUCTION


 


Section 13.1     Partial
Damage to Leased Premises. Tenant shall notify Landlord in writing immediately
upon the occurrence
of any damage to the
Premises. If the Premises is only partially damaged (meaning the cost to repair
would not exceed twenty-five percent (25%,) of replacement value) and if the proceeds received by Landlord from the
insurance policies described in Article IV (together with the deductible, if
any) are sufficient to pay for the necessary repairs, this Lease shall remain
in effect and Landlord shall repair the damage is soon as reasonably possible.
Landlord may elect to repair any damage to Tenant’s fixtures, equipment, orimprovements. If the
insurance proceeds received by Landlord (together with die deductible, if any)
are not sufficient to pay the entire cost of repair, or if the cause of the
damage is not covered by the insurance policies which Landlord maintains under
Article IV, Landlord may elect either


 


15

















 


to (a) repair the damage as soon as reasonably
possible, in which case this Lease shall remain in full force and effect, or (b)
terminate this Lease as of the date the damage occurred. Landlord shall use
reasonable efforts to notify Tenant within sixty (60) days after receipt of
notice of the occurrence of the damage, whether Landlord elects to repair the
damage or terminate this Lease. If Landlord elects to repair the damage, Tenant
shall pay Landlord Tenant’s pro-rata share of any “deductible amount” under
Landlord’s insurance policies, and, if the damage was due to an act or omission
of Tenant, the difference between the actual cost of repair and any insurance
proceeds received by Landlord. If the damage to the Premises occurs during the
last six (6) months of the Lease Term, Landlord may elect to terminate this
Lease as of the date the damage occurred, regardless of the sufficiency of any
insurance proceeds and Landlord may retain all insurance proceeds.


 


If the Premises are destroyed as described ill
this Section, and Landlord elects to repair the damage, Landlord will give
Tenant written notice of the estimated time period that Landlord has determined
in its reasonable discretion will be needed to repair the destruction. Such
notice, provided Landlord elects to repair the damage, will be given on or
before the expiration of one-hundred twenty (120) days (the “notice date”) after
the occurrence of any destruction as described above. If the Premises are
destroyed to an extent Landlord has determined in its reasonable discretion
Landlord call not commence repairs within three hundred sixty five (365) days
after the notice date, then Tenant may cancel this Lease as or the (late of the
damage by written notice given to Landlord within ten (10) days after
Landlord’s delivery of a written notice that die commencement of repairs will
not occur within such three hundred sixty five (365) day period.


 


If the Premises are destroyed as described in
this Section, and Landlord elects to repair the damage, Landlord will
reasonably approve Tenant’s use of a temporary structure on the Premises to be
installed and maintained at Tenant’s sole expense from which Tenant can conduct
business operations until such time that the damage is repaired.


 


Section 13.2     Total
or Substantial Destruction. If the Premises is totally or substantially
destroyed (meaning the cost to repair would exceed twenty-five percent (25”/0)
of replacement value) by any cause whatsoever, or if the Premises is ill a
building which is substantially destroyed (even though the Premises is not
totally or substantially destroyed), this Lease shall, at the election of the
Landlord, terminate as or the date the destruction occurred regardless
of whether Landlord receives any insurance proceeds. However, if the Premises
can be rebuilt within one (1) year after the date of destruction, Landlord may
elect to rebuild the Premises at Landlord’s owls expense (with all insurance
proceeds being made available to the Landlord to apply against such costs), in
which case, this Lease shall remain ill full force and effect. Landlord shall
use reasonable efforts to notify Tenant of such election within sixty (60) days
after the occurrence of total or substantial destruction. If the destruction
was caused by all act or omission of Tenant, Tenant shall pay Landlord Vie
difference between the actual cost of rebuilding and any insurance proceeds
received by Landlord.


 


If the Premises are destroyed as described in
this Section, and Landlord elects to repair the damage, Landlord will give
‘tenant written notice of the estimated time period that Landlord has
determined in its reasonable discretion will be needed to repair the
destruction. Such notice, provided Landlord elects to repair the damage, will
be given oil or before the expiration one-hundred twenty (120) days (the
“notice date’“) after the occurrence of any destruction as described above. If
the Premises are destroyed to ail extent Landlord has determined in its
reasonable discretion Landlord call not commence repairs within three hundred
sixty five (365) days after the notice date, then Tenant may cancel this Lease
as of the date or lute damage by written notice given to
Landlord within tell (10) days after Landlord’s delivery of a written notice
that the commencement of repairs will not occur within such three hundred sixty
five (365) day period.


 


If the Premises are destroyed as described in
this Section, and Landlord elects to repair the damage, Landlord will
reasonably approve Tenant’s use or a temporary structure oil the Premises to be
installed and maintained at Tenant’s sole expense from which Tenant call
conduct business operations until such time that the damage is repaired.


 


Section 13.3     Intentionally
Omitted.


 


Section 13.4     Landlord’s
Obligations. Landlord shall not be required to repair any injury or damage
by fire or other cause, or to make any restoration or replacement orally
paneling, decorations, partitions, railings, floor coverings, office fixtures
or any other non-building shell reliant improvements or property installed in
the Premises by Tenant or at the direct or indirect expense of Tenant which are
not part of the original improvements installed or paid for by Landlord. Tenant
shall be required to restore or replace same in the event of damage except for
damage caused solely by tile Landlord’s negligence or willful misconduct.
Tenant shall have no claim against Landlord for any damage suffered by reason
of any such damage, destruction, repair or restoration, nor shall Tenant have
the right to terminate this Lease as the result of any statutory provision now
or hereafter in effect pertaining to the damage and destruction of the Premises,
except as expressly provided herein.


 


Section 13.5     Temporary
Reduction of Rent. If the Premises is destroyed or damaged and Landlord or
Tenant repairs or restores the Premises pursuant to the provisions of this
Article XIII, any rent payable during the period of such damage, repair and/or
restoration shall be reduced by the amount payable under any rental income
insurance paid to Landlord. Except for such possible reduction in payments
required from the Tenant, Tenant shall not be entitled to ally compensation,
reduction, or reimbursement from Landlord as a result of any damage,
destruction, repair, or restoration of or to the leased Premises.


 


Section 13.6     Waiver.
Since Landlord and Tenant have agreed that the provisions of this Article XIII
shall govern the rights and obligations of Landlord and Tenant in the event of
any damage or destruction of the Premises, Tenant waives the provisions of any
law, statute, code or judicial decision which grants a tenant the right to
terminate a lease in the event of damage or destruction or the Premises.


 


16

















 


ARTICLE YIV


CONDEMNATION


 


Section 14.1     Total
Condemnation. If the whole of the Premises shall be acquired or condemned
by eminent domain for any public or quasi-public use or purpose, then the Term
of this Lease shall cease and terminate as of the date of title vesting in such
proceeding and all rentals shall be paid tip to that date and Tenant shall have
no claim against Landlord for the value of any unexpired Term of this Lease.


 


Section 14.2     Total
Condemnation of Parking-Area. If the whole of the common parking areas in
the Shopping Center shall be acquired or condemned by eminent domain for any
public or quasi-public use or purpose, then the Term of this Lease shall cease
and terminate as of the date of title vesting in such proceeding unless
Landlord shall take reasonable steps to provide other parking facilities
substantially equal to the previously existing ratio between the common parking
areas and the Premises, and such substantially equal parking facilities shall
be provided by Landlord at its own expense within ninety (90) days from the
(late of acquisition. In the event that Landlord shall provide such other
substantially equal parking facilities, then this Lease shall continue in full
force and effect. In any event, Tenant shall have no claim against Landlord for
the value of any unexpired Term of this Lease.


 


Section 14.3     Partial
Condemnation. If any pmt of the Premises shall be acquired or condemned by
eminent domain for any public or quasi-public use or purpose, and in the event
that such partial taking or condemnation shall render the Premises not
reasonably suitable for the business of the Tenant, then tile Term of this
Lease shall cease and terminate as of tire date of title vesting in such
proceeding and Tenant shall have no claim against Landlord for the value of any
unexpired term of this Lease. In the event of a partial taking or condemnation
which is not extensive enough to render the Premises unsuitable for the
business of the Tenant, their Landlord shall within a reasonable tine restore
the Premises to a condition comparable to its condition at the time of such
condemnation less the portion lost in the taking, and this Lease shall continue
in full force and effect.


 


Section 14.4     Partial
Condemnation of Parking Area. If any part of the parking area in the
Shopping Center shall be acquired or condemned by eminent domain for any public
or quasi-public use or purpose and if, as the result of such partial taking the
ratio of square feet of parking area and common use areas and facilities as
described in Section 10.1 hereof to square feet of the sales area of the entire
Shopping Center buildings is reduced to a ratio below two to one, then the Term
of this Lease shall cease and terminate from the date of title vesting in such
proceeding, unless the Landlord shall take reasonable steps toward increasing
said ratio to a ratio equal to or in excess of two to one, in which event this
Lease shall be unaffected and remain in full force and effect as between the
parties. In any event, Tenant shall have no claim against Landlord for the
value of any unexpired Term of this Lease.


 


Section 14.5     Condemnation
of Less Than A Fee. In the event of a condemnation of a leasehold interest
in all or a portion of the Premises without lie condemnation of the fee simple
title also, thus Lease shall not terminate and such condemnation shall not
excuse Tenant from full performance of all of its covenants hereunder, but
Tenant in such event shall be entitled to present or pursue against the
condemning authority its claim for and to receive all compensation or damages
sustained by it by reason of such condemnation, and Landlord’s right to recover
compensation or damages shall be limited to compensation for and damages, if
any, to its reversionary interest, it being understood, however, that during
such time as Tenant shall be out of possession of the Premises by reason of
such condemnation, the Lease shall not be subject to forfeiture for failure to
observe and perform those covenants not calling for the payment of money. In
the event the condemning authority shall fail to keep the Premises in the state
of repair required hereunder, or to perform any other covenant not calling for
the payment of money, Tenant shall have ninety (90) days after the restoration
of possession to it within which to carry out its obligations under such
covenant or covenants. During such time as Tenant shall be out of possession of
the Premises by reason of such leasehold condemnation, Tenant shall pay to
Landlord, in lieu of the Minimum Rents, and in addition to any other payments
required of Tenant hereunder, an annual rent equal to the average annual
Minimum Rents paid by Tenant far the period from the commencement of the Tenant
until the condemning authority shall take possession, or during the preceding
three (3) full calendar years, whichever period is shorter. At any time after
such condemnation or proceedings are commenced, Landlord shall have the right,
at its option, to require Tenant to assign to Landlord all compensation and
damages payable by the condemnor to Tenant, to be held without liability for
interest thereon as security for the full performance of Tenant’s covenants
hereunder, such compensation and damages received pursuant to said assignment
to be applied first to the payment of rents and all other sums from time to
time payable by Tenant pursuant to the terms of this Lease as such sums fall
due, and the remainder, if any, to be payable to Tenant at the end of the Term
hereof or on restoration of possession to Tenant, whichever shall first occur, it being understood and agreed that such assignment shall not relieve
Tenant of any of its obligations under this Lease with respect to such rents
and other sums except as the same shall be actually received by Landlord.


 


Section 14.6     Distribution
of Condemnation Award. Any condemnation award or payment shall be
distributed in the following order: (a) first, to any ground lessor, mortgagee
or beneficiary under a deed of trust encumbering the Premises, the amount of
its interest in the Premises; (b) second, to Tenant, only the amount of any
award specifically designated for loss of or damage to Tenant’s trade fixtures
or removable personal property and the Tenant hereby assigns any other rights
which the Tenant may have now or in the future to any other award to the
Landlord; and (c) third, to Landlord, the remainder of such award, whether as
compensation for reduction in the value of the leasehold, tire taking of the
fee, or otherwise. If this Lease is not terminated, Landlord shall repair any
damage to the Premises caused by the condemnation, except that Landlord shall
not be obligated to repair any damage for which Tenant has been reimbursed by
the condemning authority. If the severance damages received by Landlord are not
sufficient to pay for such repair, Landlord shall have the right to either
terminate this Lease or make such repair at Landlord’s expense. Tenant shall
have the right to pursue its claim against the condemning authority for trade
fixtures, improvements, good will, and moving expenses in connection with any
eminent domain proceeding provided that any such claim does not diminish
Landlord’s


 


17

















 


award for the taking of Landlord’s land
improvements, loss of rental income, or compensation for reduction in the value
of the leasehold.


 


ARTICLE XV


ASSIGNMENT AND SUBLETTING


 


Section 15.1     Landlord’s Consent Required. Tenant shall not either voluntarily or by
operation of law, assign, mortgage, pledge, hypothecate or encumber this Lease
or the leasehold interest created hereby or any interest herein, or sublet the
Premises or any portion thereof; or license the use of all or any portion of
the Premises or permit any other person to occupy or use the Premises or any
portion thereof (hereinafter collectively “Transfer”), without the prior
written consent of Landlord, which consent is subject to the following
conditions: (i) the proposed transferee’s use of the Premises must be
consistent with Articles VII and IX hereof; (if) fit Landlord’s reasonable
business judgment, the proposed transferee must have sufficient business
reputation and experience to operate a successful business of the type and
quality permitted tinder this Lease; (iii) intentionally omitted; (iv) the
proposed Transfer must not breach arty covenant of Landlord respecting radius,
business location, rise or exclusivity in any other lease, financing agreement
or any other agreement relating to the Shopping Center or, in Landlord’s
reasonable business judgment, create a tenant ntix concern; (v) the net worth
of the proposed transferee must not be less than ten million and no/100 dollars
($10,000,000.00); (vi) twenty-five percent (25°/0) of any profit received by
the Tenant from the proposed Transfer, whether during or after the Term of this
Lease, shall be paid to Landlord when received; and (vii) the proposed
transferee must not be an existing tenant fit the Shopping Center.


 


Section 15.2     Transfers of Interests in Tenant Requiring
Landlord’s Consent. If Tenant or its general partner or manager hereunder
is a corporation which, under laws of Nevada, is not deemed a public
corporation, or is art unincorporated association or partnership, or a limited
liability company, then the transfer, assignment, or hypothecation of any stock
or interest in such corporation, association or partnership, or limited
liability company or its general partner or manager in the aggregate fit excess
of fifty-one percent (51”%) shall be deemed a Transfer under the meaning of
this Article XV. Tenant may assign all or part of this Lease, or sublease all
or a part of the Premises, to: (a) any corporation that has the power to direct
Tenant’s management and operation, or any corporation whose management anti
operation is controlled by Tenant; or, (b) any corporation a majority of whose
voting stock is owned by Tenant; or (c) any corporation in which or with which
Tenant, its corporate successors or assigns, is merged or consolidated, in
accordance with applicable statutory provisions for merger or consolidation of
corporations, so long as the liabilities of the corporations participating in
such merger or consolidation are assumed by the corporation surviving such
merger or created by such consolidation; or (d) any corporation acquiring this
Lease and a substantial portion of Tenant’s assets; or (e) any corporate
successor to a successor corporation becoming such by either of the methods
described fit (c) or (d), so long as oil the completion of such merger,
consolidation, acquisition, or assumption, the successor has a net worth no
less than Tenant’s net worth immediately prior to such merger, consolidation,
acquisition, or assumption. Such assignment or sublease shall be deemed a Transfer
under the meaning of this Article XV, and shall in no event release Tenant or
change Tenant’s primary liability to pay the rent and to perform all other
obligations of Tenant under this Lease.


 


Section 15.3     Grant of Concessions: Conditions to Grant. The provision against subletting elsewhere
contained in this Lease shall not prohibit Tenant from granting concessions for
the operation of one or more departments of tile business which Tenant is
permitted under Section 1.8, if any, to conduct in or upon the Premises;
provided, however, that (a) each such concession may be granted only upon
receipt by Tenant of the written consent of [lie Landlord and shall be subject
to all the terms and provisions of this Lease; (b) all of the provisions hereof
applying to the business of Tenant shall apply to each such concession; and (c)
at least seventy-five percent (75°/0) of the sales flour area of the Premises
shall at all times be devoted to the business of and be operated by Tenant.


 


Section 15.4     Transfer Without Consent. Any Transfer without Landlord’s prior
written consent shall, at the option of the Landlord, constitute a non-curable
breach of this Lease. In the absence of art express agreement in writing to the
contrary, no Transfer shall act as a release of Tenant from any of the
obligations and agreements on its part to be kept and performed hereunder.
Tenant hereby fully waives and relinquishes any rights it may have under
applicable law, statute, code or judicial decision, otherwise permitting Tenant
to seek damages against Landlord and/or to attempt to terminate this Lease in
connection with all allegation that Landlord has unreasonably withheld consent
to a Transfer. Tenant agrees and acknowledges that Tenant’s sole right and
remedy against Landlord in such instance shall be to seek and to have the
Transfer approved as consistent with the terms anti provisions of this Lease or
based upon a determination that Landlord has unreasonably withheld its consent
to the proposed Transfer.


 


Section 15.5     No
Release of Tenant. No transfer permitted by this Article XV, shall release
Tenant or change Tenant’s primary liability to pay the rent and to perform all
other obligations of Tenant tinder this Lease. Landlord’s acceptance of rent
from any other person shall not constitute a waiver of any provision of this
Article XV. Consent to one transfer shall not be construed as a consent to any
subsequent transfer. Landlord may consent to subsequent assignments or
modifications of this Lease by Tenant’s transferee without notifying Tenant or
obtaining its consent, and no such action or transfer shall relieve Tenant from
liability tinder this Lease.


 


Section 15.6     Landlord’s
Election. Tenant’s request for consent to any transfer described in Section
15.1 above shall be accompanied by a written statement setting forth the
details of the proposed transfer, including the name, business and financial
condition of the prospective transferee, financial details of the proposed
transfer (e.g., the terns of and rent and security deposit payable under any
assignment or sublease), and any other information requested by Landlord.


 


18

















 


Landlord shall have the right (a) to withhold
consent based upon the standards set forth in Section 15.1; (b) to grant
consent; or (c) if the transfer is a sublease of the Premises or an assignment
of this Lease, to terminate this Lease as of the effective date of such
sublease or assignment, in which
case  Landlord may elect to enter into a direct
lease with the proposed assignee or subtenant.


 


Section 15.7     No Merger. No merger shall result from Tenant’s sublease of the Premises under
this Article XV, Tenant’s surrender of this Lease or the termination of this
Lease in any other manner. In any such event, Landlord may terminate any or all
subtenancies or succeed to the interest o fTenant as sub-landlord thereunder.


 


Section 15.8     Assignment
Fees and Procedures. In the event Landlord shall be requested to consent to
a sublease, assignment, pledge, encumbrance, or any other transfer of all or
any portion of Tenant’s rights hereunder, as specified in Section 15.1 hereof,
Tenant shall pay Landlord’s reasonable fee not to exceed Five Hundred Dollars
($500.00) to reimburse Landlord for costs and expenses, excluding attorneys’
fees, incurred in connection with reviewing Tenant’s request for consent which
shall also be reimbursed by Tenant pursuant to Section 18.2 herein. Tenant’s
check for the assignment fee shall be delivered to Landlord concurrent with
Tenant’s request for consent.


 


ARTICLE XVI


DEFAULTS: REMEDIES


 


Section 16.1     Covenants
and Conditions. Tenant’s performance of each of Tenant’s obligations under
this Lease is a condition as well as a covenant. Tenant’s right to continue in
possession of the Premises is conditioned upon full performance of all such
conditions. Time is of the essence in the performance of all covenants and
conditions.


 


Section 16.2                Defaults. Tenant shall he in material
default under this Lease:


 


(a)
If Tenant abandons or vacates the Premises;


 


(b)
If Tenant fails to pay rent or any other charge required to be paid by Tenant,
as and when due;


 


(c)
If Tenant fails to perform any of Tenant’s nonmonetary obligations under this
Lease fern period of twenty (20) days after written notice from Landlord; provided
that if more time is required to complete such performance, Tenant shall not be
in default if Tenant commences such performance within the twenty (20)-day
period and thereafter diligently pursues its completion. However, Landlord
shall not be required to give such notice if Tenant’s failure to perform
constitutes a non-curable breach of this Lease. The notice required by this
Paragraph is intended to satisfy any and all notice requirements imposed by law
oil Landlord prior to the commencement of an unlawful detainer action and is
not in addition to any such requirement;


 


(d)
(i) If Tenant makes a general assignment or general arrangement for the benefit
of creditors; (ii) if a petition for adjudication of bankruptcy or for
reorganization or rearrangement is filed by or against Tenant and is not
dismissed within thirty (30) clays; (iii) if a trustee or receiver is appointed
to like possession of substantially all of Tenant’s assets located at the
Premises or of Tenant s interest in this Lease and possession is not restored
to Tenant within thirty (30) days; or (iv) if substantially all of Tenant’s
assets located at the Premises or of Tenant’s interest in this Lease is
subjected to attachment, execution or other judicial seizure which is not
discharged within thirty (30) days. If a court of competent jurisdiction
determines that any of the acts described in this subparagraph (d) is not a
default under this Lease, and a trustee is appointed to take possession (or if
Tenant remains a debtor in possession) and such trustee or Tenant transfers
Tenant’s interest hereunder, then Landlord shall receive, as Additional Rent,
the difference between the rent (or any other consideration) paid in connection
with such assignment or sublease and the rent payable by Tenant hereunder,


 


Section 16.3     Default
by Landlord. Landlord shall not be in default unless Landlord fails to
perform obligations required of Landlord within a reasonable time, but in no
event later than thirty (30) days after written notice by Tenant to Landlord
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 Tenant in
writing, specifying wherein Landlord has failed to perform such obligation;
provided, however, that if the nature of Landlord’s obligation is such that
more than thirty (30) days are required for performance, then Landlord shall
not be in default if Landlord commences performance within such thirty (30)-day
period and thereafter diligently prosecutes the same to completion. Under no
circumstances shall Tenant have the right to terminate this Lease as a result
of Landlord’s default hereunder.


 


Section 16.4     Remedies.
Oil the occurrence of any default by Tenant hereunder, Landlord may, at any
time thereafter, with or without notice or demand and without limiting Landlord
in the exercise of any right or remedy which Landlord may have:


 


(a)Terminate
Tenant’s right to possession of the Premises by any lawful means, iii which
case this Lease shall terminate and Tenant shall immediately surrender
possession of the Premises to Landlord. In such event Landlord shall have the
immediate right to re-enter the Premises and remove all persons and property
and such property may be removed and stored in a public warehouse or elsewhere
at the cost of, and for the account of Tenant, all without service of notice or
resort to legal process and without being deemed guilty of trespass, or
becoming liable for any loss or damage which may be occasioned thereby; and
Landlord shall be entitled to recover from Tenant all damages incurred by
Landlord by reason of Tenant’s default, including (i) the worth at the time of
the award of all Minimum Monthly Rent, Additional Rent and outer charges which
were earned or were payable at tile time of the termination; (ii) the worth at
the time of the award of the amount by which the unpaid Minimum Monthly Rent,
Additional Rent and other charges


 


19

















 


which would have been carved or were payable
after termination until the time of the award exceeds the amount of such rental
loss that Tenant proves could have been reasonably avoided; (iii) the worth at
the time of the award of the amount by which the unpaid Minimum Monthly Rent,
Additional Rent and other charges which would have been payable for the balance
of the Term after the time of award exceeds the amount of such rental loss that
Tenant proves could have been reasonably avoided; and (iv) any other amount
necessary to compensate Landlord for all the detriment proximately caused by
Tenant’s failure to perform its obligations under this Lease or which in the
ordinary course of things would be likely to result therefrom whether provided
by this Lease or allowed by applicable law, including, but not limited to, any
costs or expenses incurred by Landlord in maintaining or preserving the
Premises after such default, the cost of recovering possession of the Premises,
expenses of reletting, including necessary renovation or alteration of the
Premises, Landlord’s reasonable attorneys’ fees, and any real estate
commissions or other such fees paid or payable. As used in subparts (i) and
(ii) above, the “worth at the time of the award” is computed by allowing
interest on unpaid amounts at the rate of fifteen percent (15’%) per annum, or
such lesser amount as may then be the maximum lawful rate. As used in subparts
(i) and (ii) above, the “worth at the time of the award” is computed by
discounting such amount at the discount rate of the Federal Reserve Bank of San
Francisco at the time of the award, plus one percent (1%). If Tenant shall have
abandoned the Premises, Landlord shall have the option of (i) retaking
possession of the Premises and recovering from Tenant the amount specified in
this Section 16.4(a), or (ii) proceeding under Section 16.4(b);


 


(b)
Maintain Tenant’s right to possession, in which case this Lease shall continue
in effect whether or not Tenant shall have abandoned the Premises. ]it such
event, Landlord shall be entitled to enforce all of Landlord’s rights and
remedies nuclei- this Lease, including the right to recover the rent as it
becomes due hereunder. Tenant acknowledges that Landlord may continue the Lease
in effect after Tenant’s breach anti abandonment and recover rent as it becomes
due;


 


(c)
Pursue any other remedy now or hereafter available to Landlord under the taws
or judicial decisions of the state in which the Premises is located.


 


Section 16.5    The
Right to Relet the Premises. Should Landlord elect to re-enter, as herein
provided, or should it take possession pursuant to legal proceedings or
pursuant to any notice provided for by law, it may either terminate this Lease
or it may from time to time without terminating this
Lease, make such alterations and repairs as may be necessary in order to relet
the Premises, and relet the Premises or any part thereof for such term or terms
(which may be from time to time  extending
beyond the ‘term of this Lease) anti at such rent or rents and upon such other
terms anti conditions as Landlord in its sole discretion may deem advisable;
upon each such reletting, all rent received by the Landlord from such reletting
shall be applied, first, to the repayment of any indebtedness other than rent
due hereunder from Tenant to Landlord; second, to the payment of any costs and
expenses of such reletting, including brokerage fees and attorneys’ fees anti
of costs of such alterations and repairs; third, to the payment of rent due and
unpaid hereunder, and the residue, if any, shall be held by Landlord anti
applied in payment of future rent as the same may become due and payable
hereunder. If such rentals received front such reletting during any month are
less than that to be paid during that month by Tenant hereunder, Tenant shall
pay any such deficiency to Landlord. Such deficiency shall be calculated and
paid monthly. No such re-entry or taking possession of said Premises by
Landlord shall be construed as an election on its part to terminate this Lease
unless a written notice of such intention be given to Tenant or unless the
termination thereof be decreed by a court of competent jurisdiction.


 


Section 16.6    Waiver
of Rights of Redemption. Tenant hereby expressly waives any and all rights
of redemption granted by or under any present or future laws in the event of Tenant
being evicted or dispossessed for any cause, or in the event of Landlord
obtaining possession of the Premises, by reason of the violation by Tenant of
any of the covenants or conditions of this Lease, or otherwise.


 


Section 16.7    Cumulative
Remedies. Landlord’s exercise of any right or remedy shall not prevent it
from exercising any other right or remedy.


 


Section 16.8    Late
Charges. Tenant hereby acknowledges that late payment by Tenant to Landlord
of rent and other sums due hereunder will cause Landlord to incur costs not
contemplated by this Lease, the exact amount of which will be extremely
difficult anti costly to ascertain. Such costs include, but are not limited to,
processing, administrative and accounting charges, and late charges which may
be imposed out Landlord by the terms of any mortgage or trust deed covering the
Premises. Accordingly, if any installment of rent or any other sum due from
Tenant shall not be received by Landlord or Landlord’s designee within ten (10)
days after such amount shall be due, Tenant shall pay to Landlord a late charge
equal to ten percent (10”%) of such overdue amount. The parties hereby agree
that such late charge represents a fair anti reasonable estimate of the costs
Landlord will incur as a consequence of late payment by Tenant. Acceptance of
such late charge by Landlord shall in no event constitute a waiver of Tenant’s
default with respect to such overdue amount, nor prevent Landlord from
exercising any of the other rights anti remedies granted hereunder.


 


ARTICLE WIT


PROTECTION OF CREDITORS


 


Section 17.1    Subordination.
This Lease is anti shall be subordinate to any ground lease, deed of trust or
mortgage encumbering the Premises, any advances made out the security thereof
and any renewals, modifications, consolidations, replacements or extensions
thereof, whenever made or recorded. If any ground lessor, beneficiary or
mortgagee elects to have this Lease prior to the lien of its ground lease, deed
of trust or mortgage and gives written notice thereof to Tenant, this Lease
shall be deemed prior to such ground lease, deed of trust or mortgage whether
this Lease is dated prior or subsequent to the date of such ground lease, deed
of trust or mortgage or the date of recording thereof.


 


20

















 


Section 17.2     Attornment.
If Landlord’s interest in tire Premises is acquired by any ground lessor,
beneficiary under a deed of trust,
mortgagee, or purchaser at a foreclosure sale, Tenant shall attorn to the
transferee of or successor to Landlord’s interest in the Premises and recognize
such transferee or successor as its landlord under this Lease. Tenant waives
the protection of any statute or rule of law which gives or purports to give
Tenant any right to terminate this Lease or surrender possession of the
Premises upon the transfer of Landlord’s interest.


 


Section 17.3     Signing
of Documents. ‘tenant shall execute, have notarized at Tenant’s expense and
deliver ally instrument or documents necessary or appropriate to effectuate or
evidence any such attornment or subordination or agreement to do so. If Tenant
fails to do so within tell (10) days alter written request (i) Tenant hereby
makes, constitutes and irrevocably appoints Landlord, or any transferee or
successor of Landlord, the attorney-in-fact of Tenant to execute and deliver
any such instrument or document and (ii) such failure shall constitute a
default under this Lease entitling Landlord to terminate this Lease.


 


Section 17.4     Estoppel
Certificates.


 


(a)Upon
Landlord’s written request, Tenant shall execute, have notarized at Tenant’s
expense and deliver to Landlord a written statement certifying: (i) that none
of the terms or provisions of this Lease have been changed (or if they have been changed, stating flow they have
been changed); (ii) that this Lease has not been canceled or terminated; (iii)
the last slate of payment of tile Minimum Monthly Rent and other charges and
the time period covered by such payment; (iv) that Landlord is not in default
under this Lease, or if Landlord is claimed to be in default, stating why; and
(v) such other statements as required by Landlord, or any tender or prospective
tender, investor or purchaser. Tenant shall deliver such statement to Landlord
within ten (10) days after Landlord’s request. Any such statement by Tenant may
be given by Landlord to any prospective purchaser or encumbrancer of the
Premises. Such purchaser or encumbrancer may rely conclusively upon such
statement as trite and collect.


 


(b)If
Tenant does not deliver such statement to Landlord within such tell (10)-day
period, (i) Tenant irrevocably constitutes and appoints Landlord as its special
attorney-in-fact to execute and deliver the certificate to any third party, and
(ii) such failure shall constitute a default under this Lease entitling
Landlord to terminate this I-ease. Further, Landlord, and any prospective
purchaser or encumbrancer, may conclusively presume and rely upon the following
facts: (i) that the terms and provisions of this Lease have not been changed
except as otherwise represented by landlord; (ii) that this Lease has not been
canceled or terminated except as otherwise represented by Landlord; (iii) that
not more than one months Minimum Monthly Rent or other charges have been paid
in advance; and (iv) that Landlord is not in default under this Lease. Ill such
event, Tenant shall be estopped front denying the truth of such facts.


 


Section 17.5     Tenant’s
Financial Condition. Within ten (10) days after written request front
Landlord, provided Landlord is undertaking financing or a sale of assets that
include the Premises, Tenant shall deliver to Landlord such financial
statements as are reasonably required by Landlord to verify the net worth of
Tenant, or any assignee, subtenant, or guarantor of Tenant provided all such financial
statements shall remain confidential and shall be used only for the purposes
set forth herein. Alternatively, Tenant may deliver such financial statements
directly to any lender or proposed purchaser of the premises designated by
Landlord any financial statements required by such lender to facilitate the
sale, financing or refinancing of the Premises provided all such financial
statements shall remain confidential and shall be used only for the purposes
set forth herein. Tenant represents and warrants to Landlord that (a) each such
financial statement is a ti Lie and accurate statement as of tile date of such
statement; and (b) at all times after the date of any such statement during the
Lease Term or any extension thereof, Tenant’s net worth, as stated therein,
shall not be reduced. All financial statements shall be confidential and shall
be used only for the purposes set forth herein.


 


Section 17.6 Mortgagee Protection Clause. Tenant agrees to give any rnortgagees and/or
trust deed holders, by registered mail, a copy orally notice of default, served upon the Landlord, provided that prior to such
notice Tenant has been notified in writing (by way of Notice of Assignment of
Rents and Leases, or otherwise) of the addresses of such mortgagees and/or nest
deed holders, Tenant further agrees that if Landlord shall have failed to cure
such default within the time provided for in this Lease, then the mortgagees
and/or trust decd holders shall have all additional thirty days (30) within
which to cure such default or if such default cannot be cured within that time,
then such additional time as may be necessary if within such thirty days (30)
any mortgagee and/or trust deed holder has commenced and is diligently pursuing
the remedies necessary to cure such default (including but not limited to
commencement of foreclosure proceedings if necessary to affect such cure), in
which event this Lease shall not be
terminated while such remedies are being so diligently pursued.


 


ARTICLE
XVIII


LEGAL COSTS


 


Section 18.1     Legal
Proceedings. Tenant shall reimburse Landlord, upon demand, for any costs or
expenses incurred by Landlord in connection with any breach or default of
Tenant under this Lease, whether or not suit is commenced or judgment entered.
Such costs shall include legal fees and costs incurred for [lie negotiation of
a settlement, enforcement of rights or otherwise. Furthermore, if any action
for breach of or to enforce tile provisions of this Lease is commenced, the
prevailing party shall be entitled to recover reasonable attorneys fees as part
of its judgment. Tenant shall also indemnify Landlord against and hold Landlord
harmless from all costs, expenses, demands and liability incurred by Landlord
if Landlord becomes or is made a party to ally claim or action (a) instituted
by Tenant, or by any third patty against Tenant, or by or against any person
holding any interest trader or using the Premises by license of or agreement
with Tenant; (b) for foreclosure of  any lien for labor or material furnished to or for Tenant or such other
person; (c) otherwise arising out of or
resulting from any act or transaction of Tenant or such other person; or (d)
necessary to protect Landlord’s interest under this Lease in a bankruptcy
proceeding, or other proceeding under Title 11 of the United States Code, as
amended. Tenant shall defend Landlord against any such claim or action at
Tenant’s


 


21

















 


expense with counsel reasonably acceptable to
Landlord or, at Landlord’s election, Tenant shall reimburse Landlord for any
legal fees or costs incurred by Landlord in any such claim or action.


 


Section 18.2     Landlord’s
Consent. Tenant shall pay Landlord’s reasonable attorneys’ fees incurred in
connection with Tenant’s request for Landlord’s consent under Article XV
(Assignment and Subletting), or in connection with any other act which Tenant
proposes to do and which requires Landlord’s consent.


 


ARTICLE XIX


MISCELLANEOUS PROVISIONS


 


Section 19.1     Non-Discrimination.
Tenant promises, and it is a condition to the continuance of this Lease, that
there will be no discrimination against, or segregation of, any person or group
of persons on (lie basis race, color, sex, creed, national origin or ancestry
in the leasing, subleasing, transferring, occupancy, tenure or use of the
Premises or any portion thereof.


 


Section 19.2     Landlord’s
Liability: Certain Duties. As used in this Lease, the term “Landlord” means
only the current owner or owners of the fee title to the Premises or the
leasehold estate tinder a ground lease of the Premises at the time in question.
Each Landlord is obligated to perform the obligations of Landlord under this
Lease only during the time such Landlord owns such interest or title. Any
Landlord who transfers its title or interest is relieved of all liability with
respect to the obligations of Landlord under this Lease to be performed oil or
after the date of transfer. However, each Landlord shall deliver to its
transferee all fluids previously paid by-l-errant if such funds have not yet
been applied under the terms of this Lease.


 


Section 19.3     Severabilitv.
A determination by a court of competent jurisdiction that any provision of this
Lease or any part thereof is illegal or unenforceable shall not cancel or
invalidate the remainder of such provision or this Lease, which shall remain in
full force anti effect.


 


Section 19.4     Interpretation.
The captions of the Articles or Sections of this Lease are to assist the
parties in reading this Lease and are not a part of the terms or provisions of
this Lease. Whenever required by the context of this Lease, the singular shall
include the plural and the plural shall include the singular. The masculine,
feminine and neuter genders shall each include the other. In any provision
relating to the conduct, acts or omissions of Tenant, the term “Tenant” shall
include Tenant’s agents, employees, contractors, invitees, successors or others
using the Premises with Tenant’s expressed or implied permission.


 


Section 19.5     Other
Tenancies. Landlord reserves the absolute right to effect such other
tenancies in the Shopping Center as Landlord, in the exercise of its sole
business judgment, shall determine. Tenant does trot rely oil the fact, nor
does Landlord represent, that any specific tenant or type or number of tenants
shall, during the term of this Lease either (i) enter into a (case for any
space in the Shopping Center, or (ii) continue to lease any space in the
Shopping Center tinder arty lease which is in effect as of the slate of this
Lease, or that any tenant tinder any lease in effect as of the date of this
Lease will not assign or transfer its interest tinder its lease or change the
use of the premises under such lease. By executing this Lease, Tenant
acknowledges that Landlord has not made any representations, warranties or
statements as to any of the foregoing and agrees that the occurrence of any of
the foregoing or any similar event shall not affect Tenant’s obligations tinder
this Lease.


 


Section 19.6  Entire Agreement. This Lease and the
Exhibits, and Rider, if any, attached hereto and forming a part hereof, set
forth all the covenants, terms, provisions, warranties (if any), obligations,
limitations, promises, representations, agreements, conditions and
understandings, either oral or written, between Landlord and Tenant concerning
tile Premises and there are no covenants, terms, provisions, warranties (if
any), obligations, limitations, promises, representations, agreements,
conditions or understandings, either oral, or written, between them other than
are herein set forth. Except as herein otherwise provided, no subsequent
alteration, amendment, change or addition to this Lease shall be binding upon
Landlord or Tenant unless reduced to writing and signed by the party to be
charged with their performance . Tenant acknowledges and agrees that no prior
information provided or statements made by Landlord or its agent(s), including
without limitation, estimated gross sales, estimated Operating Cost expenses or
calculations, and any other financial matters, and matters related to: (a) any
of the premises in the Shopping Center; (b) the Shopping Center itself; or (c)
the number and kinds of tenants in the Shopping Center, have in any way induced
Tenant to enter into this Lease.


 


Section 19.7     Notices
. Every notice, request, demand, consent, approval, or other communication
required or permitted tinder this Lease must be written and must identify by
name and number the section of tile Lease to which it relates. Every notice
will be given only (a) by personal delivery; or (b) by personal service
pursuant to the Federal Rules of Civil Procedure, in which event it will be
deemed received upon service; or (c) by deposit in any depository regularly
maintained by the United States Postal Service, postage pre-paid, certified
mail, return receipt requested, addressed in accordance with this Section, in
which event it will be deemed received on the third day after deposit; or (d)
by nationally recognized courier service that regularly provides written
evidence of the date of delivery, in which event it will be deemed received on
the day of delivery; or (c) by telecopy, in which event it will be deemed
received upon the sender’s receipt of evidence of complete and successful
transmission of the entire notice during normal business hours.


 


Landlord:                                                                                             McQueen Crossings, LLC

221 Fifteenth Street

Del Mar, CA 92014

Telecopy No. (858) 724-8870


 


22

















 


Tenant:                                                                                                       Notices to Tenant shall be delivered to the
address specified in Section 1.3 above, except that duplicate notices (or
original notices required by law to be served to the Premises) upon Tenant’s
taking possession of the premises may be served to the Premises. (See Section
1.3)


 


Notices may be given by an agent out behalf of
Landlord. Landlord may change its or add additional, or telecopier numbers for
purposes of this Section by giving ten (10) days’ prior notice according to
this Section. If a notice is given by more than one method, it will be deemed
received upon the earlier of the dates of receipt pursuant to this Section. If
a notice is given to more than one recipient, it will be deemed received only
upon the date of receipt by Landlord or Tenant, as the case may be, and not any
other recipient.


 


Section 19.8     Waivers.
All waivers must be in writing and signed by the waiving patty. Landlord’s
failure to enforce any provision of this Lease or its acceptance of rent shall
not be a waiver and shall not prevent Landlord front enforcing that provision
or any other provision of this Lease in the future. No statement on a payment
check from Tenant or in a letter accompanying a payment check shall be binding
oil Landlord. Landlord may, with or without notice to Tenant, negotiate such
check without being bound to the conditions of such statement .


 


Section 19.9     No
Recordation. Tenant shall not record this Lease without prior written
consent from Landlord. However, Landlord may require that a “Short Form”
memorandum of this Lease be executed by both parties and recorded.


 


Section 19.10   Binding
Effect; Choice of Law. This Lease binds any party who legally acquires any
rights or interest in this Lease 1rorn Landlord or Tenant. However, Landlord
shall have no obligation to Tenant’s successor unless the rights or interests
of Tenant’s successor are acquired in accordance with the terms of this Lease.
The laws of the state ill which the Premises is located shall govern this
Lease. Should either party institute legal action to enforce any obligation
contained herein, it is agreed that the proper venue of such suit or action
shall be the county and judicial district in which the Shopping Center is
located.


 


Section 19.11   Corporate
Authority: Partnership Authority. If Tenant is a corporation or limited
liability company, each person signing this Lease on behalf of tenant
represents and warrants that lie has full authority to do so and that this
Lease bind the corporation or limited liability company. Within five (5) days
after this Lease is signed, Tenant shall deliver to Landlord a certified copy
of a resolution of Tenant’s Board of Directors or Members, as applicable,
authorizing the execution of this Lease or other evidence of such authority
reasonably acceptable to Landlord. if Tenant is a partnership, each person
signing this ].ease for Tenant represents and warrants that lie is a general
partner of the partnership, that lie has full authority to sign for the
partnership and that this Lease binds the partnership and all general partners
of the partnership. Tenant shall give written notice to Landlord of any general
partner’s withdrawal or addition. Within five (5) clays after this Lease is
signed, Tenant shall deliver to Landlord a copy of Tenant’s recorded statement
of partnership or certificate of limited partnership.


 


Section 19.12   No
Partnership. Landlord shall not by virtue of this Lease, in any way
or for any purpose, be deemed to have become a partner of Tenant in the conduct
of its business, or otherwise, or joint venturer or a merger of a joint
enterprise with Tenant, nor is Tenant ail agent of Landlord for any reason
whatsoever.


 


Section 19.13   Joint
and Several Liability. All parties signing this Lease as Tenant shall be
jointly and severally liable for all obligations of Tenant.


 


Section 19.14  Force Majeure. If Landlord cannot
perform any of its obligations due to events beyond Landlord’s control, the
time provided for performing such obligations shall be extended by a period of
time equal to the duration of such events. Events beyond Landlord’s control
include, but are not limited to, acts of God, war, civil commotion,
bioterrorism, terrorism, labor disputes, strikes, fire, flood or other
casualty, shortages of labor or material, government regulation or restriction
and weather conditions.


 


Section 19.15   Construction
of Lease and Terms. The terms and provisions of this Lease represent the
results of negotiations between Landlord and Tenant, each of which are
sophisticated parties and each of which has been represented or been given the
opportunity to be represented by counsel of its Own choosing, and neither of
which has acted under any duress or compulsion, whether legal, economic or
otherwise. Consequently, the terms and provisions of this Lease must be
interpreted and construed in accordance with their usual and customary
meanings, and Landlord and Tenant each waive the application of any rule of law
that ambiguous or conflicting terms or provisions contained in this Lease are
to be interpreted or construed against the party who prepared the executed
Lease or any earlier draft of tile same. Landlord’s submission of this
instrument to Tenant for examination or signature by Tenant does not constitute
a reservation  of or all option to
lease and is not effective as a lease or otherwise until Landlord and Tenant
both execute and deliver this Lease. The parties agree that regardless or which
party provided the initial form of this Lease, drafted or modified one or more
provisions of this Lease, or compiled, printed or copied this Lease, this Lease
is to be construed solely as all offer from Tenant to (case the Premises,
executed by Tenant and provided to Landlord for acceptance on the terms set
forth in this Lease, which acceptance and the existence of a binding agreement
between Tenant anti Landlord may then be evidenced only by Landlord’s execution
of this Lease.


 


Section 19.16   Accord
and Satisfaction. No payment by Tenant or receipt by Landlord of a lesser
amount than the monthly rent herein stipulated shall be deemed to be other than
oil account of the earliest stipulated rent, or shall any endorsement or
statement on any check or any letter accompanying any check or payment as rent
be deemed an accord


 


23

















 


and satisfaction, and Landlord may accept such
check or payment without prejudice to Landlord’s right to recover the balance
of such rent or pursue any other remedy provided in (his Lease.


 


Section 19.17   Provisions
are Covenants and Conditions. All provisions, whether covenants or
conditions, on the part of the Landlord, or oil the part of Tenant, shall be
deemed to be both covenants and conditions.


 


Section 19.18   Intentionally
Ornitted.


 


Section 19.19  Remodel. Landlord may in the future
remodel or refurbish portions of the Shopping Center. Such remodeling and/or
refurbishing may include Tenant’s Premises subject to Tenant’s reasonable
consent which shall not be unreasonably conditioned, delayed, or withheld. The
remodeling and/or refurbishing will be done in accordance with the proper
architect’s design specifications which will be reviewed anti approved by
Landlord and copies of such drawings will be matte available to Tenant. Tenant
agrees to reasonably accept such reasonable specifications. Tenant further
agrees that Tenant will not, through any act or omission on the part of Tenant,
in any way unreasonably hinder, impede, or frustrate the efforts of the
Landlord in completing such remodeling or refurbishing in a timely fashion. As
part of architect’s design specifications, a new exterior Tenant sign criteria
(nay be developed. Upon development of said new sign criteria Tenant, at
Tenant’s expense, upon written notice from Landlord, shall remove all existing
signs and replace such exterior signs with a new sign in accordance with the
new sign criteria. Such resigning by Tenant shall be completed within sixty
(60) days after receipt of new sign criteria from Landlord.


 


Section 19.20   Waiver
of Right to Jury Trial. Landlord and Tenant hereby waive their respective
right to trial by jury of any cause of action, claim, counterclaim or cross-complaint
in any action, proceeding and/or hearing brought by either Landlord against
Tenant or Tenant against Landlord oil any matter whatsoever arising out of, or
in any way connected with, this Lease, the relationship of Landlord and Tenant,
Tenant’s use or occupancy of tile Premises, or any claim of injury or damage,
or the enforcement of any remedy under any law, statute, or regulation,
emergency or otherwise, now or hereafter in effect.


 


Section 19.21   Limitation
of Actions. Any claim, demand, right or defense of any kind by Tenant which
is based upon or arises in connection with this Lease or the negotiations prior
to its execution, shall be barred unless Tenant commences oil action thereon,
or interposes in a legal proceedings a defense by reason thereof, within one
(1) year after the date of discovery of the inaction or omission or the (late
of the occurrence of the event or of the action to which the claim, demand,
right or defense relates, whichever applies.


 


Section 19.22   Real
Estate Brokers. Except as herein specifically set forth, Landlord and
Tenant represent and warrant that there are no claims for brokerage commissions
or finder’s fees in connection with the execution of this Lease, and agree to
indemnify the other against and hold it harmless from all liability arising
from any such claim including, without limitation, the cost of attorneys’ fees
in connection therewith. Landlord is represented by Kelly Bland of Colliers
International and Landlord shall pay leasing commissions to such broker pursuant
to a mutually agreeable written agreement between the respective parties.


 


Section 19.23   Exculpation.
‘file obligations of Landlord under this Lease do not constitute personal
obligations of Landlord, or its partners, members, managers, directors, officers
or shareholders and Tenant shall look solely to the Shopping Center (as defined in Section 1.4)
and to no other assets of Landlord for satisfaction of any liability with
respect to this Lease and will not seek recourse against the partners, members,
managers, directors, officers or shareholders of Landlord herein, nor against
any of their personal assets for such satisfaction. In addition (i) no partner
of Landlord shall be sued or named as a party in any suit or action (except as
may be necessary to secure jurisdiction of the partnership), (ii) no service of
process shall be made against any partner of Landlord (except as may be
necessary to secure jurisdiction of the partnership), (iii) no partner of
Landlord shall be required to answer or otherwise plead to any service of
process and no judgment will be taken against any partner of Landlord, (iv) no
writ of execution will ever be levied against the assets of any partner of
Landlord and (v) these covenants and agreements are enforceable both by Landlord
anti also by any partner of Landlord.


 


IN
WITNESS WHEREOF, Landlord and Tenant have signed this Lease at the place and
oil the dates specified adjacent to their signatures below and have initiated
all Riders which are attached to or incorporated by reference in this Lease.


 


 


	
  Dated:

  	
  10/9/03

  	
   

  	
   

  	
  LANDLORD:

  
	
   

  	
   

  
	
   

  	
  MCQUEEN CROSSINGS, LLC,

  
	
   

  	
  a Nevada Limited Liability
  Company

  
	
   

  	
   

  
	
   

  	
  By: PERRY FAMILY VENTURES, L.P., a California

  
	
   

  	
  limited partnership, Managing Member

  
	
   

  	
   

  
	
   

  	
  By: Perry Family Trust, dated March 24, 2000, General Partner

  
	
   

  	
   

  
	
   

  	
  By:

  	
  Michael R.
  Perry, Co-Trustee

  	
   

  



 


24

















 


	
   

  	
   

  	
   

  	
  By:

  	
  ROBERT W. CARSON, Member

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Dated:

  	
  8 Oct, 2003

  	
   

  	
  TENANT:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  NEVADA SECURITY BANK,

  	
   

  
	
   

  	
  A Nevada Corporation

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  David A.
  Funk, Pres.

  	
   

  	
   

  
													



 


25

















 


RIDERS


 


Riders One, Two, Three, Four, and Five to that
certain Lease, dated October 7. 2003 by and between McQueen Crossings,
LLC, a Nevada limited liability company (“Landlord”) and Nevada Security
Bank, a Nevada corporation (“Tenant”).


 


The following Riders are hereby incorporated into the Lease
Agreement:


 


RIDER ONE - FEES AND PERMITS


 


All
building and utility fees including but not limited to building permit
expenses, sewer connection fees, water fees, water rights, traffic impact fees,
and any other fees and assessments charged by Washoe County, the City of Reno,
Truckee Meadows Water Authority (TMWA), or any other governmental or
quasi-governmental authority, associated or related to Tenant’s business or the
construction of the Building and site improvements constructed by ‘reliant or
by Landlord for the benefit of Tenant shall be paid for by Tenant at Tenant’s
sole expense.


 


At Landlord’s sole election, Tenant shall pay
Landlord or Landlord shall deduct the proportionate cost thereof from the
Improvement Allowance set forth in Rider Four below for the cost of water fees,
water rights, or traffic impact fees, and the proportionate cost thereof shall
be equal to the proportionate rate Landlord paid (without any mark-up or profit
to Landlord) for such water fees, water rights, or traffic impact fees.


 


RIDER TWO - MINIMUM MONTHLY
RENT SCHEDULE


 


	
  Minimum

  Annual Rent

  	
   

  	
  Minimum

  Monthl Rent

  	
   

  	
  Lease Years

  	
   

  
	
  $

  	
  135,000.00

  	
   

  	
  $

  	
  11,250.00

  	
   

  	
  1-5

  	
   

  
	
  $

  	
  147,000.00

  	
   

  	
  $

  	
  12,250.00

  	
   

  	
  6-10

  	
   

  
	
  $

  	
  169,050.00

  	
   

  	
  $

  	
  14,087.50

  	
   

  	
  11-15

  	
   

  
	
  $

  	
  184,920.00

  	
   

  	
  $

  	
  15,410.00

  	
   

  	
  16-20

  	
   

  



 


RIDER THREE - OPTION TO
EXTEND TERM


 


Tenant
is given the option to extend the Term of this Lease for two (2) ten (10) year
periods (individually an “extended tern”) following expiration of the initial
Term, by giving written Notice of exercise of the option (“option notice”) to
the Landlord at least six (6) months but not more than one (1) year before the
expiration of the then current Term. The same terms and conditions as applied
during the initial Term of this Lease shall apply to the extended terms except
that (i) the Minimum Monthly Rent shall be adjusted as specified below at the
commencement of each extended term and (ii) there shall be no further right or
option to extend. Provided, however, that if Tenant is in default out the date
of giving the option notice, the option notice shall be totally ineffective, or
if Tenant is in default on the date tile extended term is to commence, the
extended term shall not commence and [his Lease shall expire at the end of the
then current term. Tenant’s Lease Options are personal to Tenant and shall
automatically terminate upon ally “Transfer” of this Lease requiring Landlord’s
Consent, as defined in Section 15.1, or if the rise of the Premises is changed
from that set forth in Section I.B.


 


(a) Rent to he Determined.


 


Provided Tenant has exercised the subject
option to extend term in the manner set forth above, Landlord shall determine
the Fair Market Minimum Monthly Rent for the first year of such extended term
as set forth below. If Tenant accepts Landlord’s offer in writing within the
time frame set forth below, the parties shall immediately execute an amendment
to the Lease or enter into a new lease stating the Minimum Monthly Rent for the
first year of tile subject extended terns,
and shall specify annual increases at the commencement of the second year of
the subject extended term and annually thereafter through the expiration of the
subject option Term which shall in no event be less than three percent (3°/,)
above the Minimum Monthly Rent then in effect (as increased pursuant to the
last adjustment).


 


Landlord shall determine the Fair Market
Minimum Monthly Rent for the highest and best use of the Premises by using its
good faith judgment. Landlord shall provide written notice of such amount
within fifteen (15) days (but in
no event later than twenty (20) clays) after Tenant provides the notice to
Landlord exercising Tenant’s option rights which require a calculation of the
Fair Market Minimuim Monthly Rent. Tenant shall have thirty (30) days
(“Tenant’s Review Period”) after receipt of Landlord’s notice of the new rental
within which to accept such rental or to reasonably object thereto in writing.
In the event Tenant objects, Landlord and Tenant shall attempt to agree upon
such Fair Market Minimum Monthly Rent. If Landlord and Tenant fail to reach
agreement within fifteen (15) days following Tenant’s Review Period (“Outside
Agreement Date”), then each party shall place in a separate sealed envelope
their final proposal as to Fair Market Minimum Monthly Rent and such
determination shall be submitted to arbitration as provided below. Failure of
Tenant to so elect in writing within Tenant’s Review Period shall conclusively
be deemed its disapproval of the Fair Market Minimum Monthly Rent determined by
Landlord.


 

















 


In the event that Landlord fails to timely
generate (lie initial written notice of Landlord’s opinion of the Fair Market
Minimum Monthly Rent which triggers the negotiation period of this provision,
then Tenant may commence such negotiations by providing the initial notice, in
which event Landlord shall have thirty (30) clays (“Landlord’s Review Period”)
after receipt of Tenant’s notice of the new rental within which to accept such
rental. In the event Landlord fails to accept in writing such rental proposed
by Tenant, then such proposal shall be deemed rejected, and Landlord and Tenant
shall attempt in good faith to agree upon such Fair Market Minimum Monthly
Rent. If Landlord and Tenant fail to reach agreement within fifteen (15) days
following Landlord’s Review Period (which shall be, in such event, the “Outside
Agreement Date” in lieu of the above definition of such date), then each party
shall place in a separate sealed envelope their final proposal as to the Fair
Market Minimum Monthly Rent and such determination shall be submitted to
arbitration as provided below.


 


Landlord and Tenant shall meet with each other
within five (5) business days of the Outside Agreement Date and exchange the
sealed envelopes and then open such envelopes in each other’s presence. If
Landlord anti Tenant do not mutually agree upon the Fair Market Minimum Monthly
Rent for the highest and best use of the Premises within five (5) business days
of the exchange and opening of envelopes, then, within ten (l0) business days
of the exchange and opening of envelopes, Landlord and Tenant shall agree upon
and jointly appoint a single arbitrator who shall by profession be a real
estate appraiser or broker who shall have been active over the five (5) year
period ending on the date of such appointment in the appraising or leasing of
commercial retail properties in the vicinity of the Shopping Center. Neither
Landlord nor Tenant shall consult with such broker or real estate appraiser as
to his or her opinion as to Fair Market Minimum Monthly Rent prior to the
appointment. The determination of the arbitrator shall be limited solely to the
issue of whether Landlord’s or Tenant’s submitted Fair Market Minimum Monthly
Rent for the Premises is the closest to the actual Fair Market Minimum Monthly
Rent for the Premises as determined by the arbitrator, taking into account the
highest and best use of the Premises and the requirements of this provision. Such
arbitrator may hold such hearings and require such briefs as the arbitrator, in
his or her sole discretion, determines is necessary. In addition, Landlord or
Tenant may submit to the arbitrator, with a copy to the other party within five
(5) business days after the appointment of the arbitrator any market data and
additional information that such patty deems relevant to the determination of
the Fair Market Minimum Monthly Rent (“FMRR Data”) and the other party may
submit a reply in writing within five (5) business days after receipt of such
FMRR Data.


 


The arbitrator shall, within thirty (30) days
of his or her appointment, reach a decision as to whether the parties shall use
Landlord’s or Tenant’s submitted Fair Market Minimum Monthly Rent, without any modification
thereto by the arbitrator, anti shall notify Landlord and ‘tenant of such
determination. ‘File decision of the arbitrator shall be binding upon Landlord
and Tenant except as provided below. If Landlord and Tenant fail to agree upon
anti appoint an arbitrator, then the appointment of the arbitrator shall be
made by the Presiding Judge of the Superior Court of the county in which the
property is located, or, if he or she refuses to act, by any judge having
jurisdiction over the parties. The cost of arbitration shall be paid by
Landlord and Tenant equally.


 


In the event that Tenant objects to the Fair
Market Minimum Monthly Rent as determined by the arbitration provision
specified above, Tenant may elect to rescind its exercise of its Option by written
notice sent to Landlord within five (5) days following the establishment of the
Fair Market Minimum Monthly Rent as determined by such arbitration. In the
event Tenant elects to rescind its exercise of its Option, Tenant shall
reimburse Landlord for its actual attorneys’ fees and costs associated with
such arbitration.


 


Notwithstanding anything to the contrary
above, in no event shall the Fair Market Minimum Monthly Rent for arty extended
term be less than the Minimum Monthly Rent payable by Tenant for the month
immediately preceding any such extended term. Tenant shall have no option or
other right to extend the Term beyond the two (2) extended terms described
above.


 


RIDER FOUR - IMPROVEMENT ALLOWANCE


 


Landlord shall provide Tenant with an
Improvement Allowance in the amount of five hundred fifty thousand and
00/100 Dollars ($550.000.00) toward the cost of constructing
Tenant’s Work. Such allowance shall be paid by Landlord in not more than four
(4) installments including ten percent (10%) retainage directly to Tenant’s
general contractor. Such payments are subject to the following terms anti
conditions:


 


a)               Submittal of Application and Certification for
Payment (AIA Document 6702) and Schedule of Values with Percentage of
Completion (AIA Document 6703) to Landlord;


b)              Submittal of conditional lien releases for
subject payment request and unconditional lien releases for amounts funded for
prior payment requests to Landlord;


c)              Approval of completed work by Landlord’s
Lender and funding of draw request by Landlord’s Lender;


d)             Approval of completed work by Landlords’
Construction Manager or Architect; and


e)                Approval of completed work by Tenant.


 


RIDER FIVE-TENANT’S
COMMUNICATION EQUIPMENT


 


Tenant may install, operate, and maintain not
more than one (1) “satellite dish,” hereinafter (“Communication Equipment”),
for the purpose of receiving and sending radio, television, computer,
telephone, or other communication signals, at a location on the roof of the
Building, after first obtaining the written approval of Landlord for the type
of equipment, location, and methods of attachment, if space on the roof of the
Building is available.


 


2

















 


SUCH
COMMUNICATION EQUIPMENT SHALL AT ALL TAMES BE PLACED BEHIND A PARPET WALL. OR
SHALL BE OTHERWISE SCREENED IN A MANNER ACCEPTABLE TO LANDLORD, AND SHALL IN NO
EVENT BE VISIBLE FROM THE GROUND.


 


Tenant’s right to install, operate, and
maintain the Communication Equipment is subject to all recorded matters on the
Shopping Center, governmental laws, rules and regulations, about which Landlord
makes no representations. All costs of installation, operation, anti
maintenance (including, without limitation, cost of any satellite alignment
work necessary as a result of Landlord or Landlord’s contractor’s movement of
the Communication Equipment to facilitate repair of replacement of the roof or
any other building component or system) of the Communication Equipment and any
necessary related equipment (including, without limitation, costs of obtaining
any necessary permits) will be borne by Tenant. Landlord retains the right to
install all Communication Equipment and to use tile roof of tile Building for
any purpose, provided that Landlord does not unduly interfere with Tenant’s use
of the Communication Equipment. Tenant will use the Communication Equipment so
as not to cause any interference to other tenants ht the Building or Shopping
Center or with any communication equipment owned by Landlord or a third party,
and not to damage or interfere with the normal operation of the Building or
Shopping Center or occupants thereof. Landlord will not have any obligations
with respect to the Communication Equipment. Landlord makes no representation
that the Communication Equipment will be able to receive or transmit
communication signals without interference or disturbance (whether or not by
reason of the installation or use by others of similar equipment on the roof of
the Building), ant] Tenant agrees that Landlord will not be liable to Tenant for
any such interference or disturbance. If Landlord or any third party installs
any similar communication equipment on the roof of the building, Landlord or
such third party will use reasonable efforts to use its equipment so as not to
cause any material interference with Tenant’s Communication Equipment.


 


Tenant will (1) be solely responsible for any
damage caused as a result of the Communication Equipment; (2) promptly pay any
tax, license, or permit fees charged pursuant to any laws or regulations in connection
with the installation, maintenance, or use of
the Communication Equipment, and comply with all precautions anti
safeguards recommended by all governmental authorities, or Landlord; (3) pay
for all necessary repairs to, replacements to, or maintenance of the
Communication Equipment; (4) reimburse Landlord for the cost of construction of any curbs or platforms
for Communication Equipment required for compliance with Landlord’s roof
warranty or installed at the recommendation of
Landlord’s architect; and (4) reimburse Landlord for the cost of any repairs or replacements to the
Building (including, without limitation, the roof membrane) necessary due to
the installation methods, existence, or maintenance of the Communications
Equipment.


 


At Tenant’s sole expense, Landlord will remove
the Communication Equipment and related equipment upon the expiration or sooner
termination of this Lease or upon the imposition of any governmental law or
regulation which may require removal, and will repair the building upon removal
to the extent required by the removal or existence of the Communication
Equipment within thirty (30) days after the expiration or earlier termination
of this Lease. The provisions of this section will survive the expiration or
earlier termination of this Lease.


 


3

















 


[EXHIBIT A –
MAP]


 

















 


[EXHIBIT A
–1 MAP]


 

















 


EXHIBIT
B


 


CONSTRUCTION
OF THE PREMISES


McQueen
Crossings


Reno,
Nevada


 


NEVADA
SECURITY BANK


PAD
F


 


I.                              Plans.


 


As soon as plans are available to Landlord,
Landlord shall deliver a site plan of Pad F to Tenant or Tenant’s Architect Don
Mackey. Within forty-rive (45) days from delivery of such site plan, Tenant, al
its expense, shall submit to Landlord for its approval two (2) sets of fully dimensioned
scale drawings, plans and specifications prepared by a licensed architect and
applicable engineers. The drawings shall indicate the specific requirements of
Tenant’s Work, clearly outlining the building and other portions of the
Premises in such detail as Landlord may require, including types of materials
and colors, interior partitions, reflected ceiling plans, roof plan showing
locations of proposed equipment and penetrations, if applicable, and plumbing,
fire sprinkler, mechanical and electrical plans prepared by a licensed
electrical engineer setting forth all electric requirements of Tenant, all in
conformity with the description of Landlord’s Work and of Tenant’s Work herein
and in strict compliance with applicable codes. Landlord shall have thirty (30)
days from receipt of these drawings to approve or disapprove them. If Landlord
disapproves such plans, Tenant shall, within ten (10) days of receipt of
Landlord’s notice of disapproval, revise and resubmit such plants to Landlord,
correcting or altering such disapproved items.


 


II.                            Landlord’s Work.


 


•                  Landlord agrees to deliver possession of the
Premises as designed by Landlord’s architect in the configuration shown on the
Exhibit A-1 with the following work completed:


 


•     Graded
dirt.


 


•                  Gas, Electric, Telephone, Water, Fire Service
(if required), and Sewer service stubbed not less than five feet inside the
area of Tenant’s Work


 


Ill.                            Tenant’s Shell Building and Site Work.


 


•                   Tenant shall complete all building
construction and site work, including the curb and gutter inside the area
designated as Tenants Work on Exhibit A-1 hereof.


•                  Such work shall be designed by Tenant’s
architect Don MacKay and shall be engineered by firms reasonably approved by
Landlord.


•                    All Tenant plans are subject to the approval
of Landlord and Landlord’s architect and shall incorporate architectural design
and details to the sole satisfaction of Landlord.


 


A.                           GENERAL REQUIREMENTS.


 


1.                                       Tenant shall submit to Landlord, by certified
or registered mail, at least five (5) days prior to commencement of
construction, the following information:


 


a.                                       The names, addresses and license class and
number of all subcontractors Tenant intends to engage in the construction of
the Premises.


 


b.                                      The date on which Tenant’s construction work will
commence together with the estimated date of completion of Tenant’s
construction work and fixturization, and the date on which


the
Tenant expects to be ready to open for business in the Premises.


 


c.                                       Evidence of builder’s all risk, general
liability and worker’s compensation Insurance for Tenant’s contractor wherein a
Certificate of Insurance shall be provided to Landlord naming McQueen Crossings
LLC as additional insured, or as Landlord may reasonably require.


 


d.                                      An itemized statement of estimated construction
costs, including architectural, engineering and contractor’s fees.


 


e.                                       Tenant’s contractors’ performance and/or labor
and material bonds, if so required by Landlord’s Lender, or any other bond to
be furnished by Tenant as may be required by Landlord to insure the faithful
performance of the work in accordance with the approved plans.


 


2.                                       All contractors engaged by Tenant shall be
bondable, licensed contractors, possessing good labor relations, capable of
performing quality workmanship and working in harmony with Landlord’s
contractors and/or other contractors working on the job. All work shall be
coordinated with the general project work of the Shopping Center.


 


3.                                       Construction shall comply in all respects with
applicable Federal, State, County and City statutes, ordinances, regulations,
laws and codes. All required building and other permits in connection with the
construction and completion of the Premises shall be obtained and paid for by
Tenant.


 


4.                                       Tenant shall apply and pay for all utility meters,
hook-up fees and services, and the costs described in Rider One hereof.


 


5.                                       Tenant shall cause its contractor to provide
warranties for not less than one (1) year against defects in workmanship,
materials and equipment.


 


6.                                       Tenant’s Work shall be subject to the
inspection of Landlord and its supervisory personnel.


 

















 


7.                                       Tenant’s Work shall include, but shall not be
limited to, the cost of architectural and engineering fees, permits and special
assessment, taxes, or other fees relating to Tenant’s Work.


 


8.                                       Tenant to make applications for all utility
services and pay for water, gas and/or electrical meter including any
installation of hook up fees, permit costs, water rights, or costs related to
the foregoing.


 


9.                                       All other items and requirements not specifically
included under Landlord’s Work and any work directly or indirectly referred to
as Tenant’s Work herein.


 


B.                            LANDLORD’S
RIGHT TO PERFORM WORK.


 


Landlord
shall have the right but not the obligation to perform, on behalf of and for
the account of Tenant, subject to reimbursement of the cost thereof by Tenant,
any and all of the Tenant’s Work which Landlord determines, in its sole
discretion, should be performed immediately and on an emergency basis for the
best interest of the Shopping Center, including without limitation, removal of
unduly accumulated construction material and debris.


 


C.                            TEMPORARY FACILITIES DURING CONSTRUCTION.


 


1.                                       Tenant shall provide and pay for all temporary
facilities, and the removal to debris, as necessary and required in connection
with the construction of the Premises. Storage of Tenant’s contractor’s
construction material, tools, equipment and debris shall be confined to the
Premises and in areas which may be designated for such purposes by Landlord. In
no event shall any material or debris be stored on the sidewalk or service and
exit corridors or in the parking lot.


 


2.                                       During construction, Tenant shall maintain
such barricades, fences or other measures as may be necessary to insure the
security of the Premises and to prevent unauthorized persons from entering the
Premises or any persons suffering any injury.


 


D.                            AS-BUILT DRAWINGS.


 


Tenant
shall cause reproducible “As-Built Drawings” to be delivered to Landlord and/or
Landlord’s representative no later than thirty (3g) days after completion of
the Tenant’s Work or any alterations, additions or improvements permitted by
Landlord in accordance with the terms of this Lease. In the event these
drawings are not received by such date, Landlord may al it election, cause said
drawings to be obtained and Tenant shall pay to Landlord, as additional rent,
the cost of producing these drawings.


 

















 


EXHIBIT “C”


CONFIRMATION OF TERM OF LEASE


 


This
Confirmation of Term of Lease is
made                      
,                  
between McQueen Crossings, LLC, a Nevada limited liability company (“Landlord”)
and Nevada Security, a Nevada con)oration (“Tenant”), who agree
as follows:


 


1.
Landlord and Tenant entered into a Lease dated
                  ,                      in
which Landlord leased to Tenant and Tenant leased from Landlord the premises
described in Paragraph 1.4 of the Lease (the “Premises”).


 


2.              Pursuant to Paragraph 1.6 of the
Lease, Landlord and Tenant agree to confirm the commencement and expiration
slates of the Term, and the commencement date of rent, as follows:


 


a.
                  ,                      
is the Commencement Date of the Term of the Lease;


 


b.
                  ,                      
is the Expiration Date of the Term of Lease;


 


c.
                  ,                      
is the Commencement Date of Rent under the Lease;


 


d.
                  ,                      ,
is the Commencement Date of Other Periodic Payments under the Lease.


 


3.             Tenant confirms that:


a.        It has accepted possession of the Premises
as provided in the Lease;


b.        The improvements and space required to
be furnished by Landlord under the Lease have been furnished;


c.        Landlord has fulfilled all its duties of
an inducement nature;


d.        The Lease has not been modified,
altered, or amended, except as follows: None;


e.                        There are no setoffs or credits against rent,
and no security deposit has been paid except as provided by the Lease;


f.                          Tenant has no notice of a prior assignment,
hypothecation, or pledge of rent, or of the Lease; and


g.                       The Lease is in full force and effect.


 


4.              The provisions of this
Confirmation of Term of Lease shall inure to the benefit, or bind, is the case
may require, the parties and their respective successors subject to the
restrictions on assignment and subleasing contained in the Lease.


 


Landlord:


 


MCQUEEN CROSSINGS, LLC,


A Nevada limited liability company


 


By: PERRY FAMILY VENTURES, L.P., a California
limited partnership, Managing Member


 


	
  By:

  	
   

  



Michael
R. Perry, Trustee of the Perry Family Trust dated March 24, 2000, General
Partner


 


By: ROBERT W. CARSON, Member


 


	
  By:

  	
   

  
	
   

  	
  Robert W. Carson, Member

  



 

















 


TENANT:


 


NEVADA SECURITY BANK a Nevada Corporation


 


	
  By:

  	
  David A. Funk

  	
   

  	
   

  
	
  Its:

  	
  President

  	
   

  	
   

  
					



 


By: Its:


 


2

















 


McQueen Crossings


Robb Drive & Mae Anne Ave.


Reno, Nevada


 


SIGN CRITERIA


 


June 20, 2003


 


The goal of this sign program is to insure
the uniformity and consistency of the signage for the entire center. A copy of
the sign construction drawings for each individual Tenant will be submitted to
the City Planning staff for review and approval prior to issuance of sign
permit.


 


The following criteria will
preserve and enhance the appearance of the shopping center development,
safeguard and enhance property values, and will encourage the use of quality
signage which is integrated with and is harmonious to the buildings and site
that it occupies.


 


A.          GENERAL REQUIREMENTS


 


1.                                       Tenant shall submit, before fabrication, four
(4) copies of the proposed signs, including one (1) copy which is to be
colored, to the Landlord for approval. These drawings must include total
number, location, size and style of lettering, material, type of illumination,
installation details (including a scaled elevation drawing, if required by
Landlord), color selection, logo design, and wall graphics, and must be
approved by the City of Reno.


 


2.                                       All permits for signs shall be obtained and
paid for by Tenant. Tenant shall pay for all signs and their installation and
maintenance.


 


3.                                       Tenant shall be responsible for the
fulfillment of all requirements and specifications, and all actions or
negligence of tenant’s sign contractor. 


 


4.                                       The size, location, design, color, texture,
lighting and materials of these signs shall in no way detract from the design
of the Shopping Center and the surrounding properties.


 


5.             All
signs, permits, drawings and related expenses to be at tenant’s sole cost and
expense.


 


6.                                       TENANT’S SIGNS) MUST FIT WITHIN BUILDING
AREAS) DETERMINED AND APPROVED BY LANDLORD AND SHALL BE COMPATIBLE WITH THE
BUILDING ARCHITECTURE, WHICH MAY RESULT IN TENANT SIGNAGE THAT IS LESS OR
DIFFERENT THAN OTHERWISE ALLOWED UNDER THIS SIGN CRITERIA. LANDLORD S14ALL HAVE
THE RIGHT TO DETERMINE SUCH FIT AND ARCHITECTURAL COMPATIBILITY IN LANDLORD’S
SOLE AND ABSOLUTE DISCRETION.


 


B.            RETAIL
IN-LINE SHOP TENANTS (See attached “Sign A”‘)


 


1.                                       Each in-line shop tenant shall be permitted
one (1) wall sign. A corner tenant may at Landlord’s discretion be permitted two (2) wall signs (one (1) primary
and one (1) secondary) provided
such signs are located on different sides of the building. Notwithstanding the foregoing or anything to
the contrary in this Lease, approval of secondary signs shall be granted or denied by Landlord in Landlord’s
sole and absolute discretion.


 


2.             Wall
signs shall be made up of -


 


•                  individual exposed neon channel letters with
internally illuminated colored neon tubes;


•                  PK housings;


•                  30 ma transformer(s);


•                  clear plex faces that are 3/16” thick;


•                  returns that are:


 

















 


5.                                       Logo shall be defined as any tenant emblem
and/or graphics and shall be included in tenant’s overall sign length. Such logo shall have plex faces with
vinyl overlay. Logo area shall
in no event exceed twenty percent (20%) of tenant’s overall signage.


 


F.             MAJOR
TENANTS


 


The
provisions of this Exhibit, except as otherwise expressly provided in this
Exhibit, shall not be applicable to the identification signs of markets, drug
stores or other occupancy designated by the Landlord as a “Major Tenant” that
may be located in the Shopping Center, it being understood and agreed that
these occupants may have their usual identification signs on their buildings,
as the same exist from time to time of similar buildings operated by them in
Nevada or California; provided however, there shall be no roof-top signs which
are flashing, moving or audible and provided said sign is architecturally
compatible and has been approved by the Landlord.


 


G.            FREESTANDING
SIGNS (see attached “Sign D”)


 


One
(1) freestanding double faced sign is permitted on each street frontage (i.e.
one (1) sign on Robb Drive and one (1) sign on Mae Anne Avenue). The maximum
sign area reserved for the name of the shopping center and/or tenant’s copy on
each sign shall be sixty (60) square feet per side. Landlord may allocate the
sign area dedicated to tenant copy and the name of shopping center at
Landlord’s discretion. Maximum height for freestanding signs shall be twelve
feet (12’).


 


H.            MONUMENT
SIGN (see attached “Sign E”)


 


One
(1) freestanding double faced monument sign is permitted for the fuel center.
Such tenant monument sign shall be two (2) faced, internally illuminated, plexi
glass with and aluminum frame mounted on a standard base as shown on the
drawings. The maximum sign area reserved for tenant’s copy for such monument
sign is limited to sixteen (16) square feet, the maximum overall sign height
shall not exceed seven (7) feet, and the maximum overall sign width shall not
exceed five (5) feet.


 


1.                                       RESTRICTIONS (The provisions of this section
shall apply to Major Tenants unless otherwise approved by
Landlord in writing.)


 


I.                                           Vertical copy or signs projecting
perpendicular to the building are not permitted.


II.


2.                                       Logos or manufacturer’s decals, hours of
business, telephone numbers, etc., are limited to a total of 144 square inches per single door
entrance. All “sale” signs, special announcements, etc. are not permitted on exterior of glass. Such
advertising materials must be
set back 24 inches from glass surface, and all window signs are not to exceed amaximum of 25 percent total window
area, unless otherwise approved in writing by Landlord at Landlord’s sole discretion.


 


3.                                       Advertising devises such as attraction
boards, posters, banners and flags will not be permitted in, upon, or about the Premises or elsewhere in the Shopping Center
or sidewalks adjacent thereto.
Any such items installed by Tenant or Tenant’s agents, without Landlord’s express written consent
may be removed by Landlord, or Landlord’s agent without prior notice to Tenant, and any cost incurred for such
removal shall be paid by Tenant
to Landlord as additional rent.


 


4.             Painted,
flashing, animated, audible, revolving or other signs that create the illusion
of animation are not permitted.


 


5.                                       Exposed bulb signs are not permitted on or
near storefront glass, however, Landlord may at Landlord’s sole discretion
approve a limited amount of exposed neon signage installed on interior of
storefront.


 


6.                                       No exposed junction boxes, lamps, tubing,
conduits, raceways or neon crossovers of any type are permitted, unless approved
in writing by the Landlord.


 

















 


7.             There shall not be roof top signs, or signs which extend above the parapet wall of the roof-line
of the building to which they are attached.


 


J.             CONSTRUCTION
REQUIREMENTS


 


1.                                       Tenant is required to obtain from the City of
Reno Building Department, any and all building and electrical permits.


 


2.                                       Location of all openings for conduit in sign
panels of building walls shall be indicated by the sign contractor on drawings
submitted to the Landlord.


 


3.                                       Each sign contractor must seal off and touch
up all mounting holes and leave Premises free of debris after installation.


 


4.                                       All signs must meet “U.L.” specifications,
and the installation must comply with requirements of the City of Reno Building
Department.


 


K.            MISCELLANEOUS
REQUIREMENTS


 


1.                                       Each tenant who has a non-customer door for
receiving merchandise may have uniformly applied on said door in location, as
directed by the Landlord, in three (3) inch high block letters, the tenant’s
name and address. Where more than one tenant uses the same door, each name and
address shall be applied. Colors of letters shall match Ameritone #189A Dark
Brown.


 


2.                                       Contractors installing or repairing signs are
to be state registered contractors and are to have a current city business
license, if required.


 


3.                                       Tenant shall have all exterior signage
installed on the last to occur of: (a) thirty (30) days from the date Landlord
delivers possession of the Premises to Tenant, or (b) thirty (30) days from
completion of the applicable building areas upon which Tenant’s sign(s) is/are
to be installed.


 


4.                                       Landlord shall cause Tenant’s signage to be
removed and any damage repaired upon the expiration or earlier termination of
the Lease by a contractor of Landlord’s choice. Such work shall be done at Tenant’s sole expense
and Tenant shall reimburse Landlord for same upon demand. In no event shall Tenant remove or cause any under
canopy sign(s) or bracket(s) to
be removed at any time and same shall become the property of Landlord upon the expiration or earlier termination of
the Lease.


 

















 


[sign type A]


 

















 


[sign type B]


 

















 


[sign type C]


 

















 


[sign type D]


 

















 


[sign type E]


 

















 


[MAJOR TENANT SIGN CRITERIA EXAMPLE]