plth_ex102





 







Exhibit 10.2

 



LEASE AGREEMENT

 


THIS
LEASE AGREEMENT (the “Lease”) is made this
30th day
of August, 2014, by and between FARGO DISTRICT HOLDINGS, LLC, a
Nevada limited liability company, (hereinafter called
“Landlord”), and MM DEVELOPMENT COMPANY, LLC, a Nevada
limited liability company, (hereinafter called
“Tenant”).






 



WITNESSETH:

 



SECTION 1.



PARTIES

 

1.1 Landlord.
Landlord warrants that it owns the Premises and has full right and
power to execute and deliver this Lease without the consent or
agreement of any other person, and those persons executing this
Lease on behalf of Landlord have the right and power to execute and
deliver this Lease.

 

1.2 Tenant. Tenant warrants that
Tenant has full right and power to execute and deliver this Lease
without the consent or agreement of any other person, and that
those persons who have executed and delivered this Lease have the
authority and power to execute this lease on Tenant’s behalf
and deliver this Lease to Landlord.

 



SECTION 2.



PREMISES

 

2.1 Description.
The Premises herein leased (hereinafter called the
“Premises”) are legally
described in Exhibit “A” attached hereto and made a
part hereof. The Premises also include the building(s) and
improvements on the land area described in Exhibit “A”.
Landlord also grants to Tenant, its customers, guests, invitees
employees, and licensees all easements, rights and privileges
appurtenant thereto, including the right to use the parking areas,
driveways, roads, alleys and means of ingress and egress. The
Premises are located at 4280 Wagon Trail Avenue, Las Vegas, NV,
also identified as APN: 177-06-501-008.

 

2.2 Quiet Enjoyment. Landlord
agrees to warrant and defend Tenant in the quiet enjoyment and
possession of the Premises during the term of this Lease so long as
Tenant complies with the provisions hereof.






 



SECTION 3.



TERM: OPTION TO EXTEND

 

3.1 Lease
Commencement Date. The term of this Lease shall commence on
the date referenced above (the “Lease Commencement
Date”), with rent payments to commence upon issuance of
applicable certificates of occupancy issued by the local governing
authority, and shall terminate on December 31, 2034, (the
“Lease Termination Date”), which is the last day of the
month preceding the twentieth (20th) anniversary day of the Lease
Commencement Date unless extended by Tenant in accordance with any
extension option contained in this Lease or any rider thereto or
unless terminated in accordance with the provisions
hereof.

 

3.2 Extension Terms. Tenant shall
have the right to extend the term of this Lease for two (2)
additional terms of five (5) years each (the “Extension
Terms”) in its sole discretion upon delivering written notice
to the Landlord of its intent to exercise this option to extend not
less than twelve (12) months before the expiration date of the
initial term or of any previously exercised Extension Term of this
Lease. If Tenant exercises any of the Extension Terms in the manner
provided for in this paragraph, then the Lease shall terminate five
(5) years after the Lease Termination Date or the end of the
previously exercised Extension Term unless a subsequent Extension
Term is exercised, and all provisions of this Lease shall be
applicable to the Extension Terms.

 



 







 





 

3.3 Prorations. If any payments,
rights or obligations hereunder (whether relating to payment of
rent, taxes, insurance, other impositions, or to any other
provision of this Lease) relate to a period in part before the
Lease Commencement Date or in part after the date of expiration or
termination of the term, appropriate adjustments and prorations
shall be made.

 

3.4 Surrender at End of Term. Upon
the last day of the Lease term or upon the earlier termination of
this Lease pursuant to the provisions hereof and irrespective of
when and how such termination occurs, Tenant shall surrender and
deliver to Landlord the Premises and all buildings and improvements
thereon other than Tenant’s Property, without delay, broom
clean and in good order, condition and repair, reasonable wear and
tear and damage due to casualty excepted, whereupon Tenant shall
have no further right, title or interest in and to said Premises.
Any trade fixtures, business equipment, inventory, trademarked
items, signs and other removable personal property located or
installed in or on the Premises (“Tenant’s
Property”) shall be removed by Tenant on or before the last
day of the Lease term or upon the earlier termination of this Lease
pursuant to the provisions hereof, and Tenant shall repair any
damage occasioned by the removal of Tenant’s
Property.






 



SECTION 4.



RENT

 

4.1 Rent.
Commencing on the date (“Rent Commencement Date”) which
is thirty (30) days from issuance of certificate of occupancy from
the local governing authority, Tenant covenants and agrees to pay
to Landlord in lawful money of the United States of America, during
each Lease year, an annual rental of One Hundred Sixteen Thousand
and No/100 ($116,000), (the “Rent”). The Rent shall be
payable in equal monthly installments of Nine Thousand Six Hundred
Sixty Six and 67/100 ($9,666.67) each, in advance on or before the
first day of each and every calendar month of the term of this
Lease. The Rent shall be paid in addition to and over and above all
other payments to be made by Tenant herein. The first Lease year
shall be a full year commencing on the Lease Commencement Date and
each following Lease year shall be an annual period commencing on
the anniversary date of the Lease Commencement Date. Appropriate
proration shall be made if the Lease Commencement Date is not on
the first day of a calendar month, or if the date of termination of
the Lease is not on the last day of a calendar month.

 

4.2 Rental Adjustments. The Rent
shall be adjusted on the first day of the thirteenth (13th) month
following the calendar month in which the Rent Commencement Date
occurs (the “Anniversary Dale”) and on the first day of
each and every Anniversary Date thereafter for the term of the
Lease, plus any option periods, in accordance with the Consumer
Price Index for All Urban Consumers (the “CPI-U”) as
published by the Bureau of Labor Statistics, Washington, D.C. On
the First Anniversary Date thereafter, the Rent shall be adjusted
to equal the Current Rent then payable, plus the increased amount
in accordance with the CPI-U adjustment for the preceding year. In
no case, however, shall the Rent be decreased by any decrease in
the CPI-U. Following each Anniversary Date, the adjusted Rent shall
be due and payable for each and every month of the adjustment
period commencing with the respective Anniversary
Date.

 

4.3 Taxes.

 

(a) Tenant shall be
responsible for the payment of all real property taxes and
assessments (“Real Estate Taxes”) levied against the
Premises by any governmental or quasi- governmental authority,
which are due and payable during the Term hereof, except as set
forth herein. Real Estate Taxes shall include any taxes,
assessments, surcharges, or service or other fees of a nature not
presently in effect which shall hereinafter be levied on the
Premises as a result of the use, ownership, or operation of the
Premises or for any other reason, whether in lieu of or in addition
to any current real estate taxes and assessments. Any special
assessments will be amortized over the maximum period allowed by
law or applicable tax rules, whichever is longer, and Real Estate
Taxes will include only the prorated and amortized amount, which
becomes due during the Term hereof. Real Estate Taxes shall exclude
any income, excess profits, single business, inheritance,
succession, transfer, franchise, capital, or other tax assessments
upon Landlord or Landlord’s interest in the Premises. If any
special assessment for a public improvement is assessed against the
Premises, Tenant shall be responsible for only that portion of the
assessment allocable to the Tenant based on the length of time that
a benefit is derived by the Tenant during the Term of the Lease
calculated against the useful life of the improvement.

 

(b) Tenant shall remit
all payments for Real Estate Taxes directly to the taxing or
assessing authority. Upon receipt of all tax bills and assessment
bills attributed to any calendar year during the Term hereof,
Landlord shall furnish Tenant with a copy of the tax bill or
assessment bill, so as to allow Tenant to take advantage of the
maximum payment discount available, if Tenant so
desires.

 



 







 





 

(c) Tenant will have
the right to contest the amount or validity, in whole or in part,
of any tax that Tenant is required to pay, in whole or in part, by
appropriate proceedings diligently conducted in good faith, only
after paying such tax or posting such security that Landlord
reasonably requires in order to protect the Premises against loss
or forfeiture. Upon the conclusion of any such protest proceedings,
Tenant will pay its share of the tax, as finally determined, in
accordance with this Lease, the payment of which tax may have been
deferred during the prosecution of the proceedings, together with
any costs, fees, interest, penalties, or other related liabilities.
Landlord will not be required to join in any contest or proceedings
unless the provisions of any law or regulations then in effect
require that the proceedings be brought by or in the name of
Landlord. In that event, Landlord will join in the proceedings or
permit them to be brought in its name; however, Landlord will not
be subjected to any liability for the payment of any costs or
expenses in connection with any contest or proceedings, and Tenant
will indemnify Landlord against and save Landlord harmless from any
costs and expenses in this regard.

 

4.4 Services and Utilities. Tenant
shall be solely responsible for providing all services and
utilities to the Premises, including, but not limited to: gas,
telephone, heating, air conditioning, electrical, waste disposal,
water, janitorial, lighting or other services, together with any
taxes or penalties thereon. In the event of any interruption,
reduction or discontinuance of services (either temporarily or
permanently), Landlord shall not be liable for damages to persons
or property as a result thereof, nor shall the occurrence of any
such event in any way be construed as an eviction of Tenant. If an
interruption of services which materially affects Tenant’s
use and enjoyment of the Premises continues for more than thirty
(30) consecutive calendar days, and such interruption is not due to
an act or omission of Tenant, Tenant shall have the right to
terminate this Lease upon written notice to Landlord, and shall
surrender the Premises to Landlord.






 



SECTION 5.



USE: COMP LIANCE WITH LAWS: MAINTENANCE AND REPAIRS

 

5.1 Use
of Premises. Tenant shall have the right to use the Premises
for any lawful purpose, including the cultivation and processing of
marijuana and marijuana-based products, as provided for in
pertinent regulations associated with medical marijuana
establishments. Tenant shall not commit waste on the Premises and
shall not use the Premises for any unlawful or improper purpose or
in violation of any certificate of occupancy or for any purpose
which may constitute a nuisance, public or private, nor suffer any
dangerous article to be brought on the Premises unless safeguarded
as required by law.

 

5.2 Compliance with Laws. Tenant
shall reasonably, promptly, and effectively comply with all
applicable and lawful statutes, regulations, rules, ordinances,
orders, and requirements of any public official or agency having
jurisdiction in respect of the Premises and Tenant’s specific
use thereof (herein referred to as “Governmental
Authorities”). Landlord shall promptly give notice to Tenant
of any written notice in respect of the Premises from Governmental
Authorities. Tenant may, in good faith, dispute the validity of any
complaint or action taken pursuant to or under color of any of the
foregoing, defend against the same, and in good faith diligently
conduct any necessary proceedings to prevent and avoid any adverse
consequence of the same. Tenant agrees that any such contest shall
be prosecuted to a final conclusion as speedily as possible, and
Tenant will indemnify and hold Landlord completely harmless with
respect to any actions taken by any Governmental Authorities with
respect thereto.

 

5.3 Maintenance and Repairs by
Tenant. Except as otherwise provided in section 5.4 below,
throughout the term of this Lease, Tenant shall, at Tenant’s
sole cost and expense, keep the Premises and all improvements in
good order, condition, and repair and shall make or cause to be
made all repairs to correct any damage thereto. Notwithstanding
anything to the contrary set forth herein, in no event shall Tenant
be responsible in any way for any of the following:

 

(a) Costs of repairs or
other work occasioned by fire, windstorm or other insured
casualty;

 

(b) Costs of repairs or
rebuilding necessitated by condemnation; and/or

 

(c) Any costs, fines,
or penalties relating to environmental investigation
or

 

(d) remediation on, in,
or under the Premises not resulting from the acts or omissions of
Tenant,

 

(e) its agents, and
contractors.

 



 







 





 



SECTION 6.



ALTERATIONS: LIENS: SIGNAGE

 

6.1 Alterations.
Tenant shall not make any structural alterations in the Premises
without Landlord’s prior written consent, not to be
unreasonably withheld or delayed. Tenant shall have the right to
make interior, non-structural alterations, and structural
alterations under $25,000.00, without Landlord’s
consent.

 

6.2 Liens. All persons are put on
notice of the fact that Tenant under no circumstances shall have
the power to subject the interest of Landlord in the Premises to
any mechanic’s or materialman’s lien, or liens of any
kind. All persons who hereafter, during the life of this Lease, may
furnish work, services, or materials to the Premises upon the
request or order of Tenant or any person claiming under, by or
through Tenant, must look wholly to the interest of Tenant and not
to that of Landlord. Tenant covenants and agrees with Landlord that
Tenant will not permit or suffer to be filed or claimed against the
interest of Landlord in the Premises during the continuance of this
Lease any lien or liens of any kind by any person claiming under,
by, through, or against Tenant; and if any such lien is claimed or
filed, it shall be the duty of Tenant, within sixty (60) days after
the claim of lien or suit claiming a lien has been filed, to cause
the Premises to be released from such claim, either through payment
or through bonding with corporate surety or through the deposit
into court, pursuant to statute, of the necessary sums of money, or
in any other way that will affect the release of Landlord’s
interest in the Premises from such claim.

 

6.3 Signage. Notwithstanding
anything to the contrary set forth in this Lease, 1 tenant shall
have the absolute right to install, at its sole cost, such signage
on the Premises as Tenant may deem necessary or appropriate,
subject to appropriate governmental approvals. Landlord agrees to
fully cooperate with Tenant in filing any required signage
application, permit, and/or variance for said signage or with
respect to the Premises generally.



SECTION 7.



INSURANCE

 

7.1 Types
of Insurance. Tenant shall, at its own cost and expense,
carry the following insurance
in respect to the Premises and improvements:

 

(a) Comprehensive
public liability insurance in an amount of not less than
$2,000,000.00 combined bodily injury and property damage liability;
and

 

(b) With respect to
improvements (if any), insurance against loss or damage by fire and
other risks covered by fire insurance with extended coverage
endorsements in an amount of the full insurable replacement value
of such improvements (exclusive of cost of excavation, foundation,
and footings below the ground floor and without deduction for
depreciation) and in amounts sufficient to prevent Landlord or
Tenant from becoming a coinsurer under such policies of
insurance.

 

7.2 Provisions Applicable to All
Insurance. With respect to all insurance required to be
maintained hereunder by Tenant:

 

(a) Each such policy
shall name Landlord, Tenant, and any mortgagee as insured as their
interests appear and shall contain a Standard Mortgagee Clause
reasonably satisfactory to Landlord;

 

(b) Tenant shall, at
Tenant’s sole cost and expense, observe and comply with all
policies of insurance in force with respect to the Premises and
improvements; and

 

(c) Upon
Landlord’s request, Tenant shall send to Landlord
certificates of insurance or receipts or other evidence
satisfactory to Landlord showing the payments of all premiums and
other charges due thereon.

 

7.3 Landlord’s Right to Obtain
Insurance. If Tenant shall fail to maintain any such
insurance required hereunder, Landlord may, at Landlord’s
election, after ten (10) days’ written notice to Tenant,
procure the same, adding the premium cost to the monthly
installment of rental next due, it being hereby expressly
covenanted and agreed that payment by Landlord of any such premium
shall not be deemed to waive or release the obligation of Tenant to
make payment thereof. Tenant’s failure to either procure or
maintain the insurance required hereunder, after thirty (30)
days’ written notice from Landlord to Tenant, shall
constitute a default by Tenant under this Lease.

 



 







 





 

7.4 Use of Insurance Proceeds. Any
insurance proceeds recovered by reason of damage to or destruction
of the Premises or improvements thereto, improvements shall be made
available to Tenant and must be used to repair, restore or replace
the Premises and improvements so damaged or destroyed with any
excess proceeds made available to Tenant.

 

7.5 Damage or Destruction. If the
Premises (including improvements) are damaged to the extent of 50%
or more of its insurable value, Landlord may, in its sole
discretion, elect (a) to repair or restore the Premises
improvements, (b) to construct new Premises and improvements, or to
terminate this Lease without liability to either party. If Landlord
elects to repair or restore the Premises and improvements or
construct new Premises or improvements, it shall do so promptly and
Tenant shall receive an abatement of rent in proportion to the
extent of the damage until such time as the repair, restoration or
reconstruction is completed, but in no event shall Landlord’s
repair, restoration or reconstruction take, nor shall the rent
abatement period exceed, one hundred eighty (180) days. If Landlord
elects to terminate this Lease, Landlord shall so notify Tenant
within thirty (30) days after the damage occurs, whereupon Landlord
shall be entitled to all proceeds of insurance and right of
recovery against insurers covering such damage.

 

7.6 Subrogation. Landlord and
Tenant shall each obtain from their respective


insurers
under all policies of fire, theft, public liability, workers’
compensation and other insurance maintained by either of them at
any time during the term hereof insuring or covering the Premises,
a waiver of all rights of subrogation which the insurer of the
party might otherwise have, if at all, against the other
party.






 



SECTION 8.



EMINENT DOMAIN

 


If any
portion of the Premises which materially affects Tenant’s
ability to continue to use the remainder thereof for the purposes
set forth herein, or which renders the Premises untenantable, is
taken by right of eminent domain or by condemnation, or is conveyed
in lieu of any such taking, then this Lease may be terminated at
the option of either Party. Such option shall be exercised by
giving notice to the other Party of such termination within 30 days
after such taking or conveyance; whereupon this Lease shall
forthwith terminate and the Rent shall be duly apportioned as of
the date of such taking or conveyance. Upon such termination,
Tenant shall surrender to Landlord the Premises and all of
Tenant’s interest therein under this Lease, and Landlord may
re-enter and take possession of the Premises or remove Tenant
therefrom. If any portion of the Premises is taken which does not
materially affect Tenant’s right to use the remainder of the
Premises for the purposes set forth herein, this Lease shall
continue in full force and effect, and Landlord shall promptly
perform any repair or restoration work required to restore the
Premises, insofar as possible, to its former condition, and the
rental owing hereunder shall be adjusted, if necessary, in such
just manner and proportion as the part so taken (and its effect on
Tenant’s ability to use the remainder of the Premises) bears
to the whole. In the event of taking or conveyance as described
herein, Landlord shall receive the award or consideration for the
lands and improvements so taken; provided, however, that Landlord
shall have no interest in any award made for Tenant’s loss of
business or value of its leasehold interest or for the taking of
Tenant’s fixtures or property, or for Tenant’s
relocation expenses. Landlord and Tenant shall cooperate with one
another in making claims for condemnation awards.






 



SECTION 9.



ASSIGNMENT AND SUBLETTING: ATTORNMENT: TENANT
FINANCING

 

9.1 Assignment
by Landlord. At any time, Landlord may sell its interest in
the Premises or assign this Lease or Landlord’s reversion
hereunder, either absolutely or as security for a loan, without the
necessity of obtaining Tenant’s consent or permission, but
any such sale or assignment shall be at all times subject to this
Lease and the rights of Tenant hereunder.

 

9.2 Assignment and Subletting by
Tenant. Tenant shall have the right to assign,
sublet,
or otherwise transfer its interest in this Lease and its rights
hereunder to any entity or person with Landlord’s prior
written consent, which shall not be unreasonably withheld,
conditioned, or delayed. Notwithstanding the foregoing, Tenant may
assign, sublet, or otherwise transfer its interest in this Lease,
without Landlord’s consent, written or otherwise, to any (i)
parent, subsidiary, or affiliate of Tenant, or to a corporation or
other business entity with which Tenant may merge, amalgamate, or
consolidate, or (ii) entity in which the Premises is intended to be
leased back by such entity to Tenant, or any parent, subsidiary, or
affiliate of Tenant, or to a corporation or other business entity
with which Tenant may merge, amalgamate, or consolidate. This Lease
contains no provision restricting, purporting to restrict, or
referring in any manner to a change in control or change in
shareholders, directors, management, or organization of Tenant, or
any subsidiary, affiliate, or parent of Tenant, or to the issuance,
sale, purchase, public offering, disposition, or recapitalization
of the capital stock of Tenant, or any subsidiary, affiliate, or
parent of Tenant. In the event of any transfer, sublet, or
assignment of Tenant’s interest in this Lease, Tenant shall
remain liable for all obligations hereunder.

 



 







 





 

9.3 Attornment. Any assignee of
Landlord or Tenant hereby agrees to attorn to the Tenant or
Landlord, respectively, as the case may be.

 

9.4 Tenant Financing. Tenant shall
have the absolute right from time to time during the Term hereof to
grant and assign a mortgage or other security interest in
Tenant’s interest in this Lease with the prior written
consent of the Landlord, not to be unreasonably withheld, and
without Landlord’s further approval, written or otherwise,
all of Tenant’s property located on or used in connection
with the Premises to Tenant’s lenders in connection with
Tenant’s financing arrangements. Landlord agrees to execute
such confirmation certificates and other documents (except
amendments to this Lease unless Landlord hereafter consents) as
Tenant’s lenders may reasonably request in connection with
any such financing.

 



SECTION 10.



DEFAULT AND REMEDIES

 

10.1 Events
of Default. If:

 

(a) Tenant shall
default in the due and punctual payment of the Rent, insurance
premiums or impositions of any other amounts or rents due under
this Lease or any part thereof, and such default shall continue for
sixty (60) days after notice thereof in writing to Tenant;
or

 

(b) Tenant shall
default in the performance or in compliance with any of the other
covenants, agreements, or conditions contained in this Lease and
such default shall not be cured within sixty (60) days after notice
thereof in writing from Landlord to Tenant; or

 

(c) Tenant shall file a
petition for voluntary bankruptcy or under Chapter VII or XI of the
Federal Bankruptcy Act or any similar law, state or federal,
whether now or hereafter existing, or an answer admitting
insolvency or inability to pay its debts, or fail to obtain a
vacation or lift of stay of involuntary proceedings within ninety
(90) days after the involuntary petition is filed; or

 

(d) Tenant shall be
adjudicated a bankrupt, or a trustee or receiver shall be appointed
for Tenant or for all of its property or the major part thereof in
any involuntary proceedings, or any court shall have taken
jurisdiction of the property of Tenant or the majority part thereof
in any involuntary proceeding for reorganization, dissolution,
liquidation, or winding up of Tenant, and such trustee or receiver
shall not be discharged or such jurisdiction relinquished or
vacated or stayed on appeal or otherwise within ninety (90) days;
or

 

(e) Tenant shall make
an assignment for the benefit of its creditors; then and in any
such event referred to in clauses (a), (b), (c), (d) or (e) above,
Landlord shall have the remedies with respect to the Premises as
set forth below.

 

10.2 Landlord’s
Remedies Upon Default. Upon the occurrence of an Event of
Default by Tenant, then Landlord shall be entitled to the following
remedies:

 

(a) Landlord may
terminate this Lease by giving written notice of termination to
Tenant, in which event Tenant shall immediately surrender the
premises to Landlord. If Tenant fails to so surrender the Premises,
then Landlord may, without prejudice to any other remedy it has for
possession of the Premises or arrearages in rent or other damages,
re-enter and take possession of the Premises and expel or remove
Tenant and any other person occupying the Premises or any part
thereof, in accordance with applicable law; or

 

(b) Landlord may
re-enter and take possession of the Premises without terminating
the Lease in accordance with applicable law, and relet the Premises
and apply the Rent received to the account of Tenant. In the event
Landlord so re-enters and takes possession of the Premises as set
forth above, Landlord agrees to use reasonable efforts to relet the
Premises for a commercially reasonable rate at the lime of such
reletting. No reletting by Landlord is considered to be for
Landlord’s own account unless Landlord has notified Tenant in
writing that this Lease has been terminated. In addition, no such
reletting is to be considered an acceptance of Tenant’s
surrender of the Premises or a release of Tenant’s obligation
to pay Rent and all other charges payable hereunder (which
obligation Tenant agrees shall continue), unless Landlord so
notifies Tenant in writing.

 



 







 





 

(c) Landlord shall have
the right to accelerate the Rent and other amounts payable
hereunder should Tenant become more than two (2) months delinquent
in the payment of Rent or such other amounts payable, after the
expiration of notice and all cure periods hereunder. Landlord shall
have the right to sue Tenant for any consequential, punitive or
incidental damages including, without limitation, any claims for
lost profits and/or lost business opportunity. If Landlord does
accelerate the Rent or such other charges due hereunder, then the
accelerated rent shall be an amount equal to the Rent payable over
the balance of the Lease Term (as if this Lease had not been
terminated) less the fair rental value of the Premises for the
corresponding period. The accelerated rent shall be discounted to
the date payable at an annual interest rate equal to the prime rate
as published from time to time in the Money Section of the Wall
Street Journal, or if the same is not published, then at the prime
rate published by Bank of America in Nevada. Upon payment of the
accelerated rent discounted to present value, Tenant shall be
released from all further liability under this Lease.

 

10.3 Mitigation
of Damages. In the event that a right of action by Landlord
against Tenant arises under this Lease, Landlord shall attempt to
mitigate damages by using its best efforts to seek to relet the
Premises.

 

10.4 Landlord’s
Default. The failure of Landlord to perform any covenant,
condition, agreement, or provision contained herein within sixty
(60) days after receipt by Landlord of written notice of such
failure shall constitute an “Event of Default”
hereunder. Upon the occurrence and continuance of an Event of
Default, Tenant may, at its option and without any obligation to do
so, other than those obligations created in this document, elect
any one or both of the following remedies:

 

(a) Terminate and
cancel this Lease; or

 

(b) Pursue any other
remedy now or hereafter available at law or in equity

 

(c) in the state in
which the Premises are situated.

 



SECTION 11.



OTHER PROVISIONS

 

11.1 Remedies
to Be Cumulative. No remedy conferred upon or reserved to
Landlord or Tenant shall be considered exclusive of any other
remedy, but the same shall be cumulative and shall be in addition
to every other remedy given under this Lease or now or hereafter
existing at common law or by statute. Every power and remedy given
Landlord or Tenant may be exercised from time to time and as often
as occasion may arise or may be deemed expedient.

 

11.2 Notices.
All notices, requests, demands, or other communications which may
be or are required or permitted to be served or given hereunder (in
this Article collectively called “Notices”) shall be in
writing and shall be sent by registered or certified mail, return
receipt requested, postage prepaid, or by a nationally recognized
overnight delivery service to Tenant or to Landlord at the address
set forth below. Either party may, by Notice given as aforesaid,
change its address for all subsequent Notices. Notices shall be
deemed given when received in accordance herewith.

 


	

If to
Landlord:


 

	

Fargo
District Holding, LLC


14
Highland Creek Dr.


Henderson,
NV 89052


Attn:
Larry Scheffler


 


	

If to
Tenant:


 

	

MM
Development Company, LLC


205 N.
Stephanie St,


Ste
D-126


Henderson,
NV 89074


Attn:
Robert A. Groesbeck






 



 







 





 

11.3 No
Broker. Landlord and Tenant each warrant to the other that
no broker or agent has been employed with respect to this Lease and
each agrees to indemnify and hold the other harmless from any
claims by any broker or agent claiming compensation in respect of
this Lease alleging an agreement by Landlord or Tenant, as the case
may be.

 

11.4 Waiver
of Jury Trial. Landlord and Tenant waive trial by jury in
any action or proceeding brought by either of the parties hereto
against the other or on any counterclaim in respect thereof on any
matters whatsoever arising out of or in any way connected with the
Lease, the relationship of Landlord and Tenant, Tenant’s use
or occupancy of the Premises and/or any claim of injury or damage
under this Lease.

 

11.5 No
Partnership. Landlord shall not be construed or held to be a
partner or associate of Tenant in the conduct of Tenant’s
business, it being expressly understood and agreed that the
relationship between the parties hereto is and shall at all times
remain, during the Lease term, that of Landlord and
Tenant.

 

11.6  Non-Waiver.
No failure by Landlord or Tenant to insist upon the performance of
any covenant, agreement, provision, or condition of this Lease or
to exercise any right or remedy, consequent upon a default
hereunder, and no acceptance of full or partial rent during the
continuance of any such default, shall constitute a waiver of any
such default or of such covenant, agreement, provision, or
condition. No waiver of any default shall affect or alter this
Lease, but each and every covenant, agreement, provision, and
condition of this Lease shall continue in full force and effect
with respect to any other then-existing or subsequent default
hereunder.

 

11.7 Gender
and Number. Words of any gender used in this Lease shall be
held to include another gender and words in the singular number
shall be held to include the plural and words in the plural shall
be held to include the singular, when the sense
requires.

 

11.8 Captions.
The captions, titles, article, section, or paragraph headings are
inserted only for convenience and they are in no way to be
construed as a part of this Lease or as a limitation on the scope
of the particular provisions to which they refer.

 

11.9 Governing
Law. This Lease is made pursuant to, and shall be governed
by, and construed in accordance with, the laws of the State of
Nevada.

 

11.10 Successors
and Assigns. The covenants, conditions, and agreements in
this Lease shall bind and inure to the benefit of Landlord and
Tenant and, except as otherwise provided in this Lease, their
respective heirs, devisees, executors, administrators, legal
representatives, distributees, successors, and
assigns.

 

11.11 Amendment.
Any agreement hereafter made shall be ineffective to change,
modify, or discharge this Lease in whole or in part unless such
agreement is in writing and signed by the party against whom
enforcement of the change, modification, or discharge is
sought.

 

11.12 Hazardous
Materials. Tenant shall not do anything throughout the term
of this Lease and any extension thereof that will violate any
Environmental Laws (defined below). Tenant shall indemnify, defend,
and hold harmless Landlord, its directors, officers, employees,
agents, and assignees or successors to Landlord’s interest in
the Premises, their directors, officers, employees, and agents from
and against any and all losses, claims, suits, damages, judgments,
penalties, and liability including, without limitation, (i) all
out-of-pocket litigation costs and reasonable attorneys’
fees, (ii) all damages (including consequential damages), directly
or indirectly arising out of the use, generation, storage, release
or threatened release or disposal of Hazardous Materials by Tenant,
its agents and contractors, and (iii) the cost of and the
obligation to perform any required or necessary repair, clean-up,
investigation, removal, remediation or abatement, and the
preparation of any closure or other required plans, to the full
extent that such actions is attributable, directly or indirectly,
to the use, generation, storage, release, or threatened release or
disposal of Hazardous Materials by Tenant, its agents, and
contractors. This indemnification obligation of Tenant does not
extend to any repair, clean-up, investigation, removal,
remediation, or abatement of Hazardous Materials (i) which were
present on, under, or in the Premises before or on the Lease
Commencement Date or (ii) for which Landlord is otherwise obligated
to indemnify Tenant pursuant to this Paragraph 11.13, Hazardous
Materials shall include but not be limited to substances defined as
“hazardous materials,” or “toxic
substances” in the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended, 42 U.S.C.
Section 9601, et.seq.\ the Hazardous Materials
Transportation Act, 49 U.S.C. Section 1801 et. seq.\ the Resource Conservation and
Recovery Act, 42 U.S.C. Section 6901, et.seq.\ the common law; and any and all
state, local, or federal laws, rules, regulations, and orders
pertaining to environmental, public health, or welfare matters, as
the same may be amended or supplemented from time to time
(collectively, the “Environmental Laws”). Any terms
mentioned in this Lease which are defined in any applicable
Environmental Laws shall have the meanings ascribed to such terms
in such laws, provided, however, that if any such laws are amended
so as to broaden any term defined therein, such broader meaning
shall apply subsequent to the effective date of such
amendment.




 



 







 






 


In the
event any clean-up, investigation, removal, remediation, abatement,
or other similar action on, in, or under the Premises is required
by an governmental or quasi-governmental agency as a result of the
actions or omissions of any party other than Tenant or its agents,
contractors or invitees before or after the Lease Commencement Date
and such action requires that Tenant be closed for business for
greater than a 24-hour period, or if access to the Premises as a
result of such action is materially adversely affected for a period
in excess of 24 hours, then Tenant’s rental and other payment
obligations under this Lease shall be abated entirely during the
period beyond the 24 hours that Tenant is required to be closed for
business or abated in proportion to the amount of lost business
suffered by Tenant if access to the Premises is
impaired.


 


The
provisions of this Paragraph 11.13 shall survive the expiration or
sooner termination of this Lease.

 

11.13 Attorney’s
Fees. In the event that at any time during the Term of this
Lease either Landlord or Tenant shall institute any action or
proceeding against the other relating to the provisions of this
Lease, or any default hereunder, the unsuccessful party in such
action or proceeding agrees to reimburse the successful party for
the reasonable expenses of attorney’s fees and paralegal fees
and disbursements incurred therein by the successful party. Such
reimbursement shall include all legal expenses incurred in
arbitration, prior to trial, at trial, and at all levels of appeal
and post judgment proceedings.

 

11.14 Counterparts.
This Lease may be executed in any number of counterparts, each of
which shall be an original but all of which shall constitute one
and the same instrument. A telecopy signature of any party shall be
considered to have the same binding legal effect as an original
signature.

 

11.15 Severability.
In the event that any term, section, subsection, paragraph,
sentence, or clause of this Lease is held invalid or unenforceable,
such invalidity or unenforceability shall not affect the validity
or enforceability of the remainder of this Lease.

 

11.16 Lease
Recordation. No recordation of this Lease nor a Memorandum
of Lease is permitted at any time.

 

11.17 Time.
All terms are expressly deemed material to this Lease and time is
of the essence with respect to the performance of all obligation to
be performed or observed by the Parties hereto.


 


IN
WITNESS WHEREOF, on the day and year first written above, Landlord
and Tenant have duly executed this Lease under seal as their free
act and deed.

 





	LANDLORD:	

 

	

 

	
TENANT:	

 


	FARGO DISTRICT
HOLDING, LLC	

 

	

 

	
MM
DEVELOPMENT COMPANY, LLC	

 


	a Nevada Limited Liability Corporation
	

 

	

 

	a
Nevada Limited Liability Corporation	

 


	
 


	

 

	

 

	
   

	

 


	
/s/ Larry
Scheffler


	

 

	

 

	
/s/ Robert A.
Groesbeck

	

 


	Larry
Scheffler
	

 

	

 

	Robert A.
Groesbeck	

 


	Manager	

 

	

 

	President	

 







 




 








 






 



EXHIBIT “A”

 



Legal Description

 



THAT PORTION OF THE NORTHWEST QUARTER (NW 1/4)
OF THE NORTHEAST QUARTER (NE 1/4)
OF SECTION 6, TOWNSHIP 22 SOUTH, RANGE 61 EAST, M.D.B. & M.,
DESCRIBED AS FOLLOWS:


 



LOT TWO (2) AS SHOWN BY THE MAP THEREOF IN FILE 103 OF PARCEL MAPS,
PAGE 79, IN THE OFFICE OF THE COUNTY RECORDER, CLARK COUNTY,
NEVADA.

 

 




 








 





 



AMENDMENT TO LEASE

 


THIS AMENDMENT TO LEASE AGREEMENT (this
“Amendment”) is made as of the 1st
day of January 2018, between Fargo
District Holdings LLC, a Nevada limited liability company
(“Landlord”), and MM Development Company, LLC, a Nevada
limited liability
company(“Tenant”).

 



PRELIMINARY STATEMENTS

 




A.

Landlord
and Tenant are parties to that certain Lease Agreement, dated
August 30, 2014 (the “Lease”), under which Tenant
leased certain premises located at 4280 Wagon Trail Avenue, Las
Vegas, Nevada, including, without limitation, the building and
improvements located thereon.





 




B.

Landlord
and Tenant desire to enter into this Amendment for the purpose of
clarifying the Premises under Section 2.1 and the related Exhibit
“A”, clarifying the Rental under Section 4.1, and
modifying the Rental Adjustments provision under Section 4.2 to the
Lease.





 


NOW,
THEREFORE, for good and valuable consideration and for the
covenants and conditions of this Amendment, the receipt and
sufficiency of which are hereby conclusively acknowledged, Landlord
and Tenant agree as follows:

 





1. 

Recitals.
The above recitals are true and correct and are agreed to by
Landlord and Tenant as if such recitals were fully set forth
herein.





 





2. 

Terms.
All undefined capitalized terms herein shall have the same meaning
as defined in the Lease.





 





3. 

Description.
Section 2.1 of the Lease is hereby
amended and restated in its entirety as
follows:





 



“The Premises herein leased (hereinafter called the
“Premises”) are legally described in Exhibit
“A” attached hereto and made a part of hereof. The
Premises also include the building(s) and improvements on or to be
constructed on the land area described in Exhibit “A”.
Landlord also grants to Tenant, its customers, guests, invites,
employees and licensees all easements, rights and privileges
appurtenant thereto, including the right to use the parking areas,
driveways, roads , alleys and means of ingress and egress. The
Premises are located at 4280 Wagon Trail Avenue, Suite B, Las
Vegas, Nevada, 89118 and include approximately 2,000 square feet of
office space located at 4280 Wagon Trail Avenue, Suite A, Las
Vegas, Nevada, 89118.”

 





4. 

Rent.
Section 4.1 of the Lease is hereby amended and restated in its
entirety as follows:





 



“Commencing on the date (“Rent Commencement
Date”) which is thirty (30) days from issuance of a
certificate of occupancy from the local governing authority, Tenant
covenants and agrees to pay to Landlord in lawful money of the
United States of America, during each Lease year, an annual rental
of One Hundred Nineteen Thousand Seven Hundred Twenty Seven and
84/100 Dollars ($119,727.84), (the “Rent”). The Rent
shall be payable in equal monthly installments of Nine Thousand
Nine Hundred Seventy Seven and 32/100 Dollars ($9,977.32) each, in
advance on or before the First day of each and every calendar month
of the term of this Lease. The Rent shall be paid in addition to
and over and above all other payments to be made by Tenant herein.
The first Lease year shall be a full year commencing on the Lease
Commencement Date and each following Lease year shall be an annual
period commencing on the anniversary date of the Lease Commencement
Date. Appropriate proration shall be made if the Lease Commencement
Date is not on the First day of a calendar month, or if the date of
termination of the Lease is not on the last day of a calendar
month.”

 



 







 





 





5. 

Rental
Adjustments. Pursuant to this
Amendment to Lease, the Rent shall be adjusted to equal the rent
then currently payable, plus an increased amount as
follows:





 




Effective
Date



Increase





  



January 1, 2018 and each year
thereafter


3.0%





 





6. 

Exhibit
“A”. Exhibit
“A” to the Lease is hereby deleted in its entirety and
replaced with a new Exhibit “A” as attached to this
Amendment to Lease.





 





7. 

Ratification of
Lease. Unless expressly
modified herein, all conditions of the Lease are hereby ratified
and reaffirmed in their entirety.





 



IN WITNESS WHEREOF, the parties have executed this Amendment as of
the day and year first written above.


 





	
LANDLORD:

	
 

	
 

	
TENANT:

	
 


	
FARGO DISTRICT
HOLDING, LLC

	
 

	
 

	
MM DEVELOPMENT
COMPANY, LLC

	
 


	
a Nevada Limited Liability
Corporation


	
 

	
 

	
a Nevada Limited Liability
Corporation

	
 


	
 


	
 

	
 

	
 
 

	
 


	
/s/ Larry
Scheffler


	
 

	
 

	
/s/ Robert A.
Groesbeck

	
 


	
Larry Scheffler


	
 

	
 

	
Robert A.
Groesbeck

	
 


	
Manager

	
 

	
 

	
President

	
 






 




 








 





 



EXHIBIT “A”

 



Legal Description

 



THAT PORTION OF THE NORTHWEST QUARTER (NW 1/4)
OF THE NORTHEAST QUARTER (NE 1/4)
OF SECTION 6, TOWNSHIP 22 SOUTH, RANGE 61 EAST, M.D.B. & M.,
DESCRIBED AS FOLLOWS:

 



LOT TWO (2) AS SHOWN BY THE MAP THEREOF IN FILE 103 OF PARCEL MAPS,
PAGE 79, IN THE OFFICE OF THE COUNTY RECORDER, CLARK COUNTY, NEVADA
AND MORE COMMONLY REFERRED TO AS 4280 WAGON TRAIL AVENUE, SUITE B,
LAS VEGAS, NV 89118 PLUS +/- 2,000 SQUARE FEET OF OFFICE SPACE
LOCATED AT 4280 WAGON TRAIL AVENUE, SUITE A, LAS VEGAS, NEVADA,
89118.




 








 












 




 








 










 








 






 






 








 








 




 








 








 




 








 






 






 








 






 






 








 






 




 




 








 





 



SECOND AMENDMENT TO LEASE AGREEMENT

 



This SECOND AMENDMENT TO LEASE AGREEMENT (the
“Amendment”) is entered into and made as of the
14th
day of September,
2018, by and between
FARGO DISTRICT
HOLDINGS, LLC, a Nevada limited
liability company (“Landlord”), and MM DEVELOPMENT COMPANY,
INC., a Nevada corporation
(successor to MM Development Company, LLC, a Nevada limited
liability company, pursuant to Articles of Conversion, dated March
14, 2018) (“Tenant”).

 



RECITALS

 



WHEREAS, Landlord and Tenant
entered into a Lease Agreement dated August 30,
2014, hereinafter called the
“Original
Lease”, and a subsequent
Amendment to Lease Agreement, dated January 1, 2018 and with the
foregoing, collectively, the “Lease”.

 



STATEMENT OF AGREEMENT

 



WHEREAS, Landlord and Tenant
desire to modify and amend the Lease by this further
Amendment.

 



NOW THEREFORE, in consideration
of the mutual covenants herein set forth, and for other good and
valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties agree as
follows:

 


1. Section 2.1,
PREMISES. Section 3 of the
Amendment to Lease, dated January 1, 2018 is hereby amended in its
entirety and restated as follows: That certain portion of the
Project (as defined below), including all improvements therein,
commonly known by the street address of 4280 Wagon Trail Avenue,
Suite B, located in the city of Las Vegas, County of Clark, State
of Nevada, with zip code 89118 (the “Premises”) and generally described as approximately
12,348 square feet of two-story office/lab space (see
Exhibit A
attached hereto) located within the
4280 Wagon Trail building, which totals approximately 25,372 square
feet. In addition to Tenant’s rights to use and occupy the
Premises as described in the Lease, Tenant shall have non-exclusive
rights to any utility raceways of the building and to the common
areas. The Premises, the building, the common areas and the land
upon which they are located, are herein collectively referred to as
the “Project.”

 


2. Section 2.1, PREMISES;
PARKING. Tenant shall be
entitled to use a maximum of twenty-five (25)
parking spaces on those
portions of the common areas designated from time to time by
Landlord for parking. Said parking spaces shall be used for parking
by vehicles no larger than full-size passenger automobiles or
pick-up trucks, hereinafter called “Permitted Size
Vehicles.” No vehicles
other than Permitted Size Vehicles may be parked in the common
areas without the prior written permission of the Landlord, except
for temporary parking (no longer than 48 hours in length) will be
permitted for trucks and vans in connection with shipping and
deliveries. In addition, Tenant shall not permit or allow any
vehicles that belong to or are controlled by Tenant or
Tenant’s employees, suppliers, shippers, customers,
contractors or invitees to be loaded, or parked in areas other than
those designated by Landlord for such activities and in no event,
shall Tenant conduct service, repair, washing or storage of any
vehicles in the common areas. If Tenant permits or allows any of
the prohibited activities described above, then Landlord shall have
the right, without notice, in addition to such other rights or
remedies that it might have, to remove or tow away the vehicle
involved and charge the cost to the Tenant, which cost shall be
immediately payable upon demand by Landlord.

 


3. Section 2.1, CONDITION OF
PREMISES. Tenant acknowledges
it has accepted possession of the Premises in its existing
“as-is” condition and that all existing building
systems are in good operating condition. Tenant acknowledges that:
(a) it has inspected and is satisfied with respect to the condition
of the Premises (including but not limited to the electrical, HVAC
and fire sprinkler systems, security, environmental aspects, and
compliance with all governmental codes and the Americans with
Disabilities Act) and their suitability for Tenant’s intended
use, (b) Tenant has made such investigation as it deems necessary
with reference to such matters and assumes all responsibility
therefore as the same relates to its occupancy of the Premises, and
(c) the Landlord has made no oral or written representations or
warranties with respect to said matters other than as set forth in
the Lease.

 


4. Section 3.4, TENANT’S
PROPERTY. At the expiration or
earlier termination of the Lease, Tenant will perform any clean-up
necessary to remove any odor or residue pertaining to the use of
the Premises for medical marijuana and other materials. The removal
of Tenant’s Property does not include removal of the HVAC and
other building systems at the Property.

 


5. Section 4.1,
RENT. Pursuant to this Second
Amendment, the base monthly rental due under the Lease shall be
Nine Thousand Nine Hundred Seventy Seven and 32/100 Dollars
($9,977.32). Rent and other financial obligations of Tenant
(sometimes referred to as “Additional
Rent”) will be paid to
Landlord by good and sufficient check drawn on a US-based bank or
bank wire transfer, in a manner reasonably acceptable to Landlord
(and not by delivery of currency to Landlord).

 


6. Section 4.1, RENT
DUE. The Payment of Rent (Base
Rent and Common Area Operating Expenses) is due on the first day of
each month, without notice
from the Landlord.

 


7. Section 4.1,
RENT/NON-SUFFICIENT FUNDS. Notwithstanding the provisions of the Lease as
amended (for late charges and interest on past due obligations), in
the event that Tenant’s monthly rent check is returned to
Landlord due to non-sufficient funds, Tenant shall be required, for
the remainder of the Lease Term, to pay Landlord said monthly rent
in the form of a cashier’s check.

 



 







 





 


8. Section 4.2 RENTAL
ADJUSTMENTS. The adjustment
date (“Adjustment
Date”) for the Base Rent
under Section 4.2 shall be on the first day of January 2019 and on
each and every subsequent anniversary thereof for the term of the
Lease. The amount of the adjustment/increase to monthly Base Rent
under Section 4.2 is fixed at a three percent (3.0%) annual increase
above the amount of monthly Base Rent payable at the end of the
immediately preceding annual period.

 


9. Section 4.4, TERMINATION BY
TENANT BECAUSE OF INTERRUPTION OF SERVICES. Tenant will not exercise its right to terminate
this Lease pursuant to Section 4.4 of the Lease unless Tenant has first given
Landlord at least twenty (20) days advance notice of its intent to
terminate the Lease under such Section 4.4 (which notice may be given at any time after the
interruption first occurs) if the interruption is not cured within
the 30-day time period provided in the Lease.

 


10. Section 5.1, USE OF
PREMISES. Tenant will obtain
Landlord’s consent, which will not be unreasonably withheld
or delayed, if Tenant intends to change the use of the Premises
pursuant to Section 5.1 from the specific use as named in
Section
5.1, as currently operated in
the Premises.

 


11. NET LEASE.

 


(A)
Payment of
Operating Expenses. Tenant
shall promptly pay the Landlord for Tenant’s proportionate
share of maintenance, repair and replacements, property taxes and
assessments, property insurance premiums, operating expenses, or
any other costs, expenses, charges or premiums under this Lease
relative to the leased Premises and Project (collectively,
“Operating
Expenses”), including
(without limitation) the costs incurred by Landlord for: (i)
maintenance, repair and replacement (as necessary) of the Building
roof and structure, improvements and other portions of the Project
(provided,
if the nature of the work is a capital improvement, which shall be
limited to the roof, the parking lot and the HVAC and evaporative
cooling equipment, the cost will be allocated over a twelve year
period and Tenant shall not be required to pay more than
Tenant’s share of 1/144 of the cost of such capital
improvement in any given month); (ii) Real Estate Taxes and
assessments affecting the Project; (iii) the cost of the premiums
for the “all risk” insurance policies required to be
carried by the Landlord for the Project (see Section 7 of the Lease as modified below); (iv) costs for
maintaining the common areas of the Project, including but not
limited to exterior window cleaning, exterior lighting, gardening
and landscaping, maintenance and repair of sprinkler systems,
fire/life safety protection systems, storm drainage systems,
elevator systems, striping, repairing, replacing (including any
alterations necessary to comply with any applicable Legal
Requirements, as defined below) and maintaining the Building,
improvements, roof system, HVAC and mechanical equipment, parking
and accessways of the Project; (v) the cost of utility services to
the Project and the Premises, including water, sewer, natural gas
and electricity; and (vi) reasonable management and administrative
fees on the Operating Expenses. Landlord may require Tenant to pay
monthly installments of estimated Operating Expenses, subject to an
annual reconciliation and adjustment after the actual Operating
Expenses for the year are determined. Upon request from Tenant from
time to time (but not more frequently than once each year, for the
most recently completed year), Tenant will have the right, at
Tenant’s expense and upon not less than forty-eight (48)
hours’ prior written to Landlord, to review or audit at
reasonable times Landlord’s books and records (to the extent
available) for purposes of verifying Landlord’s calculation
of Operating Expenses charged to Tenant. A copy of the review or
audit report will be provided simultaneously to Landlord and
Tenant. In the event the review or audit shows (and the parties in
good faith determine) that the Operating Expenses charged to Tenant
are greater or lesser than the amount previously invoiced to Tenant
for the year, then Landlord will grant a credit to Tenant against
the Operating Expenses next payable by Tenant or refund to Tenant
in cash, or Tenant will pay to Landlord, the amount of such
difference within 30 days after determination of the overpayment or
underpayment, as applicable. For purposes of the Lease,
Tenant’s “proportionate
share” shall be
Forty-Eight point
Sixty-Seven percent (48.67%),
which is equal to the rentable square footage of the Premises
(which is conclusively deemed to be 12,348 square feet of rentable
area) divided by the total rentable square footage of the Building
on the Project (which is conclusively deemed to be 25,372 square
feet of rentable area).

 


(B) Service Contracts.
Tenant shall, at
Tenant's
sole expense, procure and maintain contracts, with copies to
Landlord, in customary form and substance for, and with contractors
specializing and experienced in the maintenance of the following
equipment and improvements, if any, if and when installed on the
Premises: (i) HVAC equipment, (ii) elevators, and (ii) any other
equipment, if reasonably required by Landlord. However, Landlord
reserves the right, upon notice to Tenant, to procure and maintain
any or all of such service contracts, and Tenant shall reimburse
Landlord, upon demand, for the cost thereof.

 


(C) Section 5.4, Maintenance and
Repair. Section 5.4 of the Lease shall be deleted in its entirety and
replaced with the following: The costs incurred by Landlord in
doing any repair, maintenance or replacements to the Building and
other improvements on the Premises will be part of the Operating
Expenses payable by Tenant and the other tenant(s) of the Project,
pursuant to this Amendment. Operating Expenses include costs for
maintenance, repair and replacement (as necessary) from time to
time to the Building, improvements and other portions of the
Property so that they are maintained in first-class repair,
operating condition, working order and appearance, in accordance
with applicable requirements of Governmental Authorities and the
recorded covenants, conditions and easements (collectively,
“Legal
Requirements”).

 



 







 





 


(D) Section 5.5, Net Lease Payments
- Additional Rent.
Landlord’s budget for the Operating Expenses (the
“Additional
Rent”) for the fiscal
year 2018 is currently estimated to be $0.13 per square foot per
month, which equates to $1,605.42 monthly. Landlord may, if the
actual expenses change during the course of the year, choose to
adjust the amount impounded in order to more properly reflect the
actual expense to be incurred. Landlord currently does not provide
any interior maintenance or cleaning, security services, trash
removal, or interior pest control within the Operating Expenses,
which said services and expenses shall be the responsibility of the
Tenant. In addition, the Tenant acknowledges there is only one (1)
electrical meter serving the Project and the Premises and the
Tenant shall be responsible for allocating the pro-rata share for
the cost of said electrical service with the other Tenant(s) in the
Project. In the event the Landlord elects to provide such services
(at Landlord’s reasonable election), the Landlord reserves
the right to include the expenses as part of the Additional
Rent.

 


12. Section 6.1,
ALTERATIONS. Pursuant to
Section
6.1, Tenant will obtain
Landlord’s consent for any exterior changes or any interior
changes that may affect the structure or building systems for the
Premises if the cost would equal or exceed $25,000 or if a building
permit is required under applicable Legal Requirements for the work
being done.

 


12. Section 6.3, SIGNAGE. Section
6.3 of the Lease is modified to
require Landlord’s consent, not to be unreasonably withheld
or delayed, for exterior signage.

 


13. Section 7,
INSURANCE. Pursuant to
Section
7, Tenant will maintain
business interruption insurance, if desired by Tenant, and other
insurance coverage sufficient to insure the costs payable during
any period in which the Building is not operated for business as a
result of a casualty. The limits on the commercial general
liability (“CGL”) insurance in Section 7.1(a)
may be reasonably adjusted by Landlord
during the Lease term to the amount typically
maintained by businesses in the same geographic
area (the Las Vegas-Henderson greater metropolitan area) and will
cover Landlord as an additional insured. Tenant’s CGL
coverage shall be primary and any insurance maintained by Landlord
shall be excess and non-contributing insurance only. The
“fire insurance” in Section 7.1(b)
shall be so-called all risk (or
“special form”) insurance coverage and the Landlord
shall be the named insured for said coverage. All such insurance
shall: (i) provide for severability of interest; (ii) provide that
an act or omission of one of an additional insured (excluding
deliberate or intentional acts that are not covered under a general
liability policy) shall not reduce or avoid coverage to any other
named or additional insured; and (iii) afford coverage for all
claims based on acts, omissions, injury and damage, which claims
occurred or arose (or the onset of which occurred or arose) in
whole or in part during the policy period. The evidence of
insurance coverage in Section 7.2(c)
will include a copy of the insurance
policy or a certificate of insurance with enough detail on the
insurance as to reasonably satisfy Landlord that Tenant is
maintaining the insurance required by this
Lease.

 




 








 





 


15. Section 7.6, WAIVER OF
SUBROGATION. For purposes
of Section
7.6 and other provisions of
this Lease, each party hereby releases and waives any and all
rights to recover from the other party, and its officers,
directors, members, trustees, employees, agents and
representatives, for loss or damage to any property of the
releasing party or any person claiming through the releasing party
arising from any loss or damage caused by any risks covered by a
standard “special form” property insurance policy, or
from any other cause required to be insured against by the
releasing party under this Lease, and there shall be no subrogated
claim by one party’s insurance carrier against the other
party arising out of any such loss.

 


16. Section 9.2, ASSIGNMENT OR
SUBLEASE. Except
as otherwise permitted under
Section
9.2, any assignment, sublease
or other transfer (directly, indirectly, by operation of law or
otherwise) requires Landlord’s prior written consent pursuant
to the first sentence of Section 9.2, which will not be unreasonably withheld or
delayed. Tenant will promptly notify Landlord in the event Tenant
transfers its interest under this Lease pursuant to the second
sentence of Section 9.2 (a “Permitted
Transfer”), which will
include reasonable information on the name of the assignee and its
address for notices under this Lease. Tenant (and any guarantors
and co-obligors under this Lease from time to time) will remain
primarily liable under this Lease. Landlord will only be required
to send notices under this Lease to the holder from time to time of
the Tenant’s interest under this lease. On Landlord’s
reasonable request from time to time, Tenant will confirm in
writing any assignment or sublease of the
Premises.

 


17. Section 10.2(a), PAYMENT
DEFAULTS. For purposes
of Section
10.1(a), the time period is
modified from 60 days after notice to Tenant to ten (10) days after
Tenant’s receipt of written notice of nonpayment when due;
provided, if Tenant has twice in the prior twelve (12) months
received a notice of nonpayment of rent or other financial
obligations (whether or not the payment was made in such 20-day
period or the default was subsequently cured), Tenant will be in
default if Tenant fails to pay, within ten (10) days after the due
date (without the necessity for written notice) any Rent or other
financial obligations owed by Tenant to Landlord pursuant to this
Lease.

 


18. Section 10.2, LANDLORD’S
DEFAULT REMEDIES. In addition
to the remedies in Section 10.2,
Landlord may exercise any right or
remedy for default permitted under applicable Nevada
law.

 


19. Section 10.4, TENANT’S
TERMINATION RIGHTS. Tenant will
not exercise any remedies under Section 10.4
for a Landlord “Event of
Default” unless the required notice has been sent to Landlord
and to any mortgagee of Landlord that has requested such notice (a
“Landlord Default
Notice”). The Landlord
Default Notice will: (i) be given in the manner provided in this
Lease for notices, and (ii) contain reasonable detail concerning
the manner in which Landlord is in breach of its obligations
hereunder. If a non-emergency default is of such a nature that it
cannot be remedied fully within the 60-day period, this requirement
shall be satisfied if Landlord (or any mortgagee) begins correction
of the default within the 60-day period, and thereafter proceeds
with reasonable diligence to effect the remedy as soon as
practicable.

 


Any
mortgagee of Landlord that has notified Tenant of its address in
the manner provided for notices in this Lease will have the right
to cure Landlord’s defaults under this section. The cure
period for the mortgagee will commence on notice to such mortgagee
of the default and extend for a period ending twenty (20) days
after the end of the time period for Landlord to cure a default. In
this connection, any representative of the mortgagee shall have the
right to enter upon the Premises for the purpose of curing
Landlord’s default.

 


20. NON-DISTURBANCE
AGREEMENT. In connection with
any financing by Landlord from time to time, Tenant will sign a
subordination, non-disturbance and attornment agreement
(“SNDA”) with Landlord and Landlord’s
lender.

 


21. SECURITY
DEPOSIT/GUARANTOR. PLANET 13
HOLDINGS, INC., a Canadian corporation, pursuant to the Guaranty
attached hereto as Exhibit B and made a part hereof
(“Guaranty”).

 


22. RECORDATION. This Lease will NOT be recorded by Tenant,
unless Landlord has provided its express written consent and
executes and notarizes the document to be
recorded.

 


23. Addition to Lease, OTHER
PROVISIONS.

 


(a) Late Payments by
Tenant. Any Rent, Additional
Rent or other financial obligation of Tenant that is not paid
within five (5) days after receipt of written notice of nonpayment
when due will be subject to a late charge of five
(5) cents per
dollar of the overdue payment, to reimburse Landlord for the costs
of collecting the overdue payment. Tenant shall pay the late charge
upon demand by Landlord. In addition, if any Rent, Additional Rent
or other financial obligation of Tenant is not paid to Landlord
within ten (10) days after receipt of written notice of nonpayment
when due, the amount owed to Landlord will bear interest
(“Default Rate
interest”) at the rate of twelve
percent (12%) per annum, but not in any event at a rate higher than
the maximum rate of interest permitted under applicable law, until
paid in full. Landlord may levy and collect a late charge and
Default Rate interest in addition to all other remedies available
for Tenant’s default, and collection of a late charge and
Default Rate interest shall not waive the breach caused by the late
payment.

 


(b) Partial or Delinquent
Payments. Payment by Tenant or
receipt by Landlord of any amount less than the full monthly rental
or other charges due from Tenant, or any endorsement or statement
on any check or letter accompanying any check or rent payment,
shall not in any event be deemed an accord and satisfaction.
Landlord may accept such check or payment without prejudice to
Landlord’s right to recover the balance of such rental or
pursue any other remedy provided in this Lease.

 


() Additional Rent, No
Offsets. All payments required
to be paid by Tenant under this Lease, other than monthly base
rent, will constitute Additional Rent. All rent (including base
Rent and Additional Rent) shall be received by Landlord without
set-off, offset, abatement, or deduction of any
kind.

 



 







 





 


(c) Storage,
Trash. Tenant shall not store
anything outside except in areas which are appropriately screened
from view of the public and consistent with current usage. No trash
will be outside of the container and Tenant will use only trash and
garbage receptacles that are reasonably approved by Landlord.
Tenant shall dispose of any materials from Tenant’s
operations and trash and other matter at Tenant’s expense, in
a manner that complies with State and local legal governmental
requirements.

 


(d) Reasonable Rules and
Regulations. Landlord may make
and enforce reasonable rules and regulations consistent with this
Lease for the purpose of regulating access, establishing standards
and requirements concerning the conduct and operation of business,
and promoting safety, order, cleanliness, and good service to the
property. Tenant will promptly comply with all such rules and
regulations.

 


(e) Holdover
Tenancy. If Tenant remains in
possession of the Premises after the expiration or earlier
termination of this Lease, Tenant will pay a holdover Rent amount
to Landlord in the amount of 150% of the monthly Rent that was
payable immediately before the commencement of the holdover period.
Landlord may also elect to eject Tenant from the Premises and
recover damages caused by wrongful holdover, in accordance with
applicable law. If a month-to-month tenancy results from a holdover
by Tenant, the tenancy shall be terminable at the end of any
monthly period on written notice from Landlord given not less than
10 days prior to the termination date as specified in the notice.
Tenant waives any notice which would otherwise be provided by law
with respect to month-to-month tenancy.





(g) Tenant’s Rights.
Tenant hereby represents that it does
not currently have any first rights of refusal to purchase the
property, other pre-emptive rights to purchase or any other rights
not expressly set for herein.

 


(h) Time of
Essence. TIME IS OF THE ESSENCE
of the performance of each party’s obligations under this
Lease.

 


(i) No Implied
Appurtenances. This Lease does
not create any implied rights to light and air or any other rights,
easements or licenses, by implication or otherwise,
except
as expressly set forth in this Lease.
This Lease is an unsubordinated lease covering the Premises, and
any financing by Tenant will encumber only Tenant’s leasehold
interest. Landlord will not be subordinating the fee title or
Landlord’s interest to any mortgage or other lien securing
any financing by Tenant.

 


(j) Succession; Limitation on
Obligations of Landlord. This
Lease shall bind and inure to the benefit of the parties, their
respective heirs, successors, and assigns. Any claim against
Landlord under this Lease shall be limited to and enforceable only
against and to the extent of Landlord's interest in the Premises
during the period of Landlord’s ownership. No resort may be
had to the private property of any member, trustee, director,
officer, partner, beneficiary, stockholder, employee, or agent of
Landlord.

 


() Inspection. Landlord or its authorized representatives may
enter at any reasonable time after such advance notice as is
reasonable under the circumstances (except in cases of emergency,
for which no advance notice is required) to determine
Tenant’s compliance with this Lease, to make necessary
repairs, to show the Premises to a prospective party desiring to
acquire Landlord’s interest, or (during the last six (6)
months of the Lease term) to advertise the Premises as available
for rent, to have an appropriate sign posted at the Premises and to
show the Premises to any prospective tenants.

 


(k) Attornment. In the event any proceedings are brought for
foreclosure, or in the event of the exercise of the power of sale
under any mortgage or trust deed made by Landlord covering the
Premises, Tenant shall attorn to the purchaser upon any such
foreclosure or sale and recognize such purchaser as Landlord under
this Lease

 


(l) Estoppel
Certificates. Within 10 days
after Landlord’s written request, Tenant shall deliver a
written statement stating the date to which the rent and other
charges have been paid, whether the Lease is unmodified and in full
force and effect, and any other matters that may reasonably be
requested by Landlord.

 


(m) Financial
Information. Tenant and any
guarantor of this Lease (“Guarantor”) will promptly provide to Landlord (on
request) copies of tax returns, detailed financial statements and
other information reasonably required from time to time, but
not more
frequently than annually or as
may be required by Landlord in connection with any financing or
intended sale of the Property by Landlord. Any financial
information on Tenant or a Guarantor will be maintained as
confidential information, except that it may be given by Landlord
to any actual or prospective buyer or mortgagee of
Landlord.

 


(n) Prior
Agreements. The Lease (as
amended) and this Amendment are the entire, final, and complete
agreement of the parties with respect to the matters set forth
therein, and supersede and replace all written and oral agreements
previously made or existing by and between the parties or their
representatives.

 


(o) Full Force and
Effect. Except as expressly
modified in this Amendment, the Lease is in full force and effect
in accordance with its terms.

 



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IN
WITNESS WHEREOF, each of the undersigned has caused this instrument
to be duly executed and delivered by authorized person(s) as of the
date first set forth above.

 



LANDLORD:                                                                            

TENANT:





 



FARGO DISTRICT HOLDINGS, LLC,

MM
DEVELOPMENT COMPANY, INC.







a Nevada limited liability company

a
Nevada corporation





 



By /s/
Larry
Scheffler  


By /s/
Robert A.
Groesbeck





 



Name (printed): Larry
Scheffler  


Name (printed): Robert A.
Groesbeck





 



Its:
Manager   


Its:
President





 

 










By /s/
Leighton
Koehler





 










Name (printed): Leighton
Koehler





 








Its: Secretary





 








 








 






 




LEASE
AMENDMENT


Tenant
MM DEVELOPMENT COMPANY, INC.


  




 








 





 



Exhibit B - Guaranty