Document:

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.

 

[NO MORE TEXT ON THIS PAGE]

 

 

 

 

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 - Guarantyplth_ex103

 

Exhibit
10.3

 

LEASE AGREEMENT

 

THIS
LEASE AGREEMENT (the “Lease”) is made this 17th of
July, 2020 by and between Rx Land, LLC , a Nevada limited liability
company (hereinafter called “Landlord”), and West Coast
Development Nevada, LLC a Nevada limited liability company.
(hereinafter called "Tenant').

 

WITNESSETH:

 

SECTION I

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 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 4801 West Bell Drive, Las
Vegas, Nevada and also identified as APN: 162-30-104-003 and
162-30-104-005.

 

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 July 16, 2020 and shall terminate on June 30, 2030,
(the “Lease Termination Date”), which is the last day
of the month preceding the tenth (10th) 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 July 16, 2020, 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 Seven Hundred Forty Seven Thousand Seven Hundred Fifteen Dollars
& 20/100ths Dollars ($795,096.00) (the “Rent”). The
Rent shall be payable in equal monthly installments of Sixty Two
Thousand Three Hundred Nine and 60/100 ($62,309.60) 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 thirteent
(13'h) 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.h

 

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: COMPLIANCE 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.
Tenant shall, at Tenant’s sole
expense, promptly and throughout the
Term, maintain, repair, and replace the Premises, including but not
limited to the roof, parking lot and HVAC system, in a good and
clean condition comparable to other similar commercial buildings in
the Las Vegas, Nevada metropolitan area, and in compliance with all
applicable laws, and will suffer no active, passive or permissive
waste or injury thereof or thereto. Tenant shall give Landlord
prompt notice of any specific needed repairs, replacements or
maintenance which will (1) affect the exterior walls, exterior
doors, windows of the building, the structural parts of the
building, the roof of the building, or the parking areas, or (2)
exceed Ten Thousand and 00/100 Dollars ($10,000.00) (collectively
“Material
Repairs”). Tenant shall provide Landlord copies of
plans and specifications for such Material Repairs, as required by
Landlord. Landlord shall then have twenty (20) days after receipt
of such plans and specifications to approve or reject the same by
delivering written notice to Tenant. If Landlord fails to respond
within such twenty-day period, Landlord shall be deemed to have
approved such plans and specifications. All Material Repairs to the
Premises shall be performed by Tenant using contractors or
mechanics approved by Landlord in accordance with plans and
specifications approved by Landlord, and shall be at Tenant’s
sole expense and at such times and in such manner as Landlord may
approve. Any mechanics’ or materialmen’s lien for which
Landlord has received a notice of intent to file or which has been
filed against the Premises arising out of work done for, or
materials furnished to Tenant, shall be discharged, bonded over, or
otherwise satisfied by Tenant within ten (10) days following the
earlier of the date Landlord receives (1) notice of intent to file
a lien or (2) notice that the lien has been filed. If Tenant fails
to discharge, bond over, or otherwise satisfy any such lien,
Landlord may do so at Tenant’s expense, and the amount
expended by Landlord, including reasonable attorney’s fees
and costs, shall be due and payable immediately
with interest thereon at the Interest Rate from the date of the
payment by Landlord until Landlord receives payment from Tenant. If
Tenant fails to comply with its maintenance, repair, or replacement
obligations in this Section 5.3, Landlord may, in
its sole discretion and in addition to any other remedies provided
herein, perform said maintenance, repair, or replacement. Any sums
so paid by Landlord, together with reasonable attorney’s fees
and costs, shall be deemed to be additional Rent owing by Tenant to
Landlord and shall be due and payable immediately with interest
thereon at ten percent (10%) per annum from the date of the payment
by Landlord until Landlord receives payment from
Tenant.

  

 

 

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, 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 co- insurer 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 Landlord in accordance with Section 7.5
below, 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; SUBORDINATION

 

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 this Lease only to Planet 13 Holdings, Inc. or
its affiliates or subsidiaries.

 

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.

 

9.5 Subordination.
This Lease shall be subordinate to
the lien or security title of any mortgage or
security deed or the lien resulting from any other method of
financing or refinancing now or hereafter in force against the
Premises, any portion thereof, or upon any buildings now or
hereafter placed upon the land of which the Premises are a part,
and to any and all advances to be made under such financing
instruments, and all renewals, modifications, extensions,
consolidations and replacements thereof. The aforesaid provisions
shall be self-operative and no further instrument of subordination
shall be required to evidence such subordination. Tenant covenants
and agrees to execute and deliver, upon demand, such further
instrument or instruments subordinating this Lease on the foregoing
basis to the lien of any such mortgage or mortgages as shall be
desired by Landlord and any mortgagees or proposed mortgagees, and
hereby irrevocably appoints Landlord the attorney-in-fact of Tenant
to execute and deliver such instrument or instruments within five
(5) days after written notice to do so.

 

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: (i)
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; or (ii) any default, after giving effect to any notice and
cure provision, by Landlord as borrower under that certain Note
Secured by Dee of Trust executed simultaneously herewith 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
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:

Rx Land,
LLC

4265 W. Sunset
Road 

Las Vegas, NV
89118 

If to
Tenant:

West Coast
Development

Nevada
LLC

c/o A. Todd
Justice 

8845 Road Oak
Blvd.

Charlotte, NC
28217

 

With a copy
to:

MM Development
Company, LLC

2548 West Desert
Inn Road

 

 Las
Vegas, Nevada 89109

 

Attn: Leighton
Koehler 

 

 

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.

 

For the
purpose of 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 i f 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 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 obligations to be performed or
observed by the Parties
hereto.  

11.18 Financial Reporting.
Upon Landlord’s request, Tenant
will furnish or cause to be furnished the
following
materials to Landlord; provided, however, that Landlord shall keep
confidential such items furnished by Tenant to the extent they are
not generally available to the public or Landlord is not required
by Applicable Laws to make disclosure of
them: 

 

(i)
Within one hundred twenty (120) days after the end of each fiscal
year of Tenant, (A) the annual income statement and balance sheet
for Tenant for such fiscal year, including all supporting schedules
and comments, audited
by a certified public accounting firm, (B) a statement of revenues
and expenses of the Premises for such fiscal year in detail
reasonably satisfactory to Landlord, and (C) the annual debt
schedule for Tenant for such fiscal year;

 

(ii)
Within
forty-five (45) days after the end of each calendar quarter, the
following materials with respect to Tenant: a detailed balance
sheet, profit and loss statement, cash flow statement and census
data by payor type for such quarter in a form acceptable to
Landlord (including trailing twelve (12) month trends for
each).

 

(iii)
Within forty-five (45) days after the end of each calendar quarter,
the following materials with respect to the Premises: a profit and
loss statement, cash flow statement and census data by payor type
for such quarter in a form acceptable to Landlord (including
trailing twelve (12) month trends for each); and with reasonable
promptness, such other information respecting the financial
condition and affairs of Tenant as Landlord may reasonably request
from time to time.

 

 

 

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

 

Landlord

 

Rx
Land, LLC,

a
Nevada limited liability company

 

By:
/s/ Larry
Scheffler

Its:
Manager

 

Tenant

 

West
Coast Development Nevada, LLC

 

By:
/s/ Raymond Scott
Coffman

Its:
Manager

 

 

 

Exhibit
“A”

 

THE
LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE COUNTY OF CLARK,
STATE OF NEVADA , AND IS DESCRIBED AS FOLLOWS:

 

PARCEL
I: (APN 162-30-104-003)

 

THE
NORTHWEST QUARTER (NW 1/4) OF THE SOUTHEAST QUARTER (SE 1/4) OF THE
NORTHWEST QUARTER (NW 1/4) OF THE NORTHWEST QUARTER (NW 1/4) OF
SECTION 30, TOWNSHIP 21 SOUTH, RANGE 61 EAST, M.D.M.

 

EXCEPTING
THEREFROM THE NORTH 30 FEET (30.001)
AS CONVEYED TO CLARK COUNTY BY THAT CERTAIN GRANT, BARGAIN, SALE
DEED RECORDED MAY 9, 1985 AS DOCUMENT NO. 2066726 IN BOOK 2107 OF
OFFICIAL RECORDS, CLARK COUNTY, NEVADA.

 

FURTHER
EXCEPTING THEREFROM A PORTION OF THE NORTHWEST QUARTER (NW 1/ 4) OF
THE NORTHWEST QUARTER (NW 1/4) OF SECTION 30, TOWNSHIP 21 SOUTH,
RANGE 61 EAST, M.D.M., CLARK COUNTY, NEVADA, BEING MORE
PARTICULARLY DESCRIBED AS FOLLOWS:

 

COMMENCING
AT THE NORTHWEST CORNER OF SECTION 30, TOWNSHIP 21 SOUTH, RANGE 61
EAST,

 

M.D.M.,
CLARK COUNTY, NEVADA;

 

THENCE
SOUTH 00°1122" EAST A DISTANCE OF 661.78 FEET TO A
POINT;

THENCE
NORTH 89°58116"
EAST A DISTANCE OF 509.89 FEET TO A POINT;

THENCE
SOUTH 00°15113"
EAST A DISTANCE OF 30.00 FEET TO THE TRUE POINT OF
BEGINNING;

THENCE
CONTINUING SOUTH 00°15113"
EAST A DISTANCE OF 211.81 FEET TO A POINT;

THENCE
NORTH 00000113"
EAST A DISTANCE OF 211.81 FEET TO A POINT;

THENCE
SOUTH 89°58116"
WEST A DISTANCE OF 0.95 FEET TO THE TRUE POINT OF
BEGINNING.

 

PARCEL
II: (APN 162-30-104-005)

 

A
PORTION OF THE NORTHWEST QUARTER (NW 1/4) OF THE NORTHWEST QUARTER
(NW 1/4) OF SECTION 30, TOWNSHIP 21 SOUTH, RANGE 61 EAST, M.D.M.,
CLARK COUNTY, NEVADA, BEING MORE PARTICULARLY DESCRIBED AS
FOLLOWS:

 

COMMENCING
AT THE NORTHWEST CORNER OF SECTION 30, TOWNSHIP 21 SOUTH, RANGE 61
EAST, M.D.M. CLARK COUNTY, NEVADA; THENCE SOUTH 00°1122" EAST
A DISTANCE OF 661.78 FEET TO A POINT; THENCE NORTH 89°58'16"
EAST A DISTANCE OF 509.89 FEET TO A POINT; THENCE SOUTH
00°151311
EAST A DISTANCE OF 241.81 FEET TO THE TRUE POINT OF BEGINNING;
THENCE SOUTH 89°5824" WEST A DISTANCE OF 0.40 FEET TO A POINT;
THENCE SOUTH 00°00'13" EAST 89.10 FEET TO A POINT; THENCE
NORTH 89°5824" EAST 0.40 FEET TO A POINT; THENCE NORTH
00°00113"
EAST A DISTANCE OF 89.10 FEET TO THE TRUE POINT OF
BEGINNING.

 

 

	

 

 

 

 

4.        
Consent, No Waiver.
Landlord consents to this Agreement and to the assignment of the
Lease as of the Assignment Effective Date from Assignor to
Assignee, and to the Amendment of Leases as shown in paragraph 3 of
this Agreement. By this Consent, Landlord does not waive any legal
remedies or rights available under the original lease, or as
amended.

 

6.         
Expenses. The parties hereto
will bear their separate expenses in connection with this Agreement
and its performance.

 

7.         
Entire Agreement. This
Agreement embodies the entire understanding of the parties hereto
and there are no other agreements or understandings written or oral
in effect between the parties relating to the subject matter hereof
unless expressly referred to by reference herein. This Agreement
may be amended or modified only by an instrument of equal formality
signed by the parties or their duly authorized agents.

 

8.         
Governing Law. This Agreement
shall be governed by and construed in accordance with the laws of
the State of Nevada and each of the parties hereto submits to the
non-exclusive jurisdiction of the courts of the State of Nevada in
connection with any disputes arising out of this
Agreement.

 

8.         
Successors and
Assigns. This Agreement and the provisions hereof shall be
binding upon and shall inure to the benefit of the successors and
assigns of the parties.

 

9.         
Attorneys' Fees. In the event
of a dispute arising under this Agreement, the prevailing party
shall be entitled to recover all reasonable attorneys'
fees.

 

10.       
Counterparts. This Agreement
may be executed in two or more counterparts, each of which shall be
deemed an original but all of which together shall constitute one
and the same instrument. Facsimile signatures shall be deemed the
same as originals.

  

 

 

IN
WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the Assignment Effective Date.

 

Assignor

 

 

	

/s/ R. Scott
Coffman

	
 

West
Coast Development Nevada, LLC

By: R.
Scott Coffman, Manager

 

Assignee

 

/s/ Leighton Koehler

MM
Development Company, Inc.

By:
Leighton Koehler, Corporate Secretary

 

For consent and amendment purposes only (Sections 3 and
4)

 

Landlord

 

/s/ Larry Scheffler

RX
Land, LLC

By:
Larry Scheffler, Manager

 

 

 

Exhibit A: Lease Agreement dated July 17th,
2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

AMENDMENT TO LEASE

 

THIS
AMENDMENT TO LEASE AGREEMENT (this “Amendment”) is made
as of the 27th day of November 2020, between RX Land, LLC, a Nevada
limited liability company (“Landlord”), and MM
Development Company, Inc., a Nevada domestic corporation
(“Tenant”).

 

RECITALS

 

A.

On July 17, 2020,
RX Land, LLC purchased APNs 162-30-104-003 and 16230-104-005 and
buildings thereon, commonly known as 4801 West Bell Drive, Las
Vegas, NV 89118 (the “Premises”) from Indus Holdings
Co. (“Indus”). The land and buildings were subject to a
lease with West Coast Development Nevada, LLC (“WCDN”),
which was cancelled and re-issued pursuant to a commercial lease
acceptable to RX Land on July 17, 2020. The APNs referenced hold
special use permits allowing licensed cannabis cultivation and
production activities on the premises.

 

B.

Concurrent with the
land purchase transaction by RX Land, LLC, on July 17, 2020 Planet
13 Holdings, Inc., through its wholly owned subsidiary MM
Development Company, Inc. entered into an asset purchase agreement
for all assets and licenses of the cannabis operation, being
cultivation and production, by WCDN at the Premises. On November
27, 2020, MMDC and WCDN completed the second and final closing
under the asset purchase agreement, which included the assignment
and assumption of the lease from WCDN to MMDC.

 

C.

Prior to the July
17, 2020 transaction, the independent members of Planet 13
Holdings, Inc. Board of Directors approved and directed MMDC to
enter into a lease transaction that mirrored the terms of the
existing MMDC cultivation and production facility lease at 4280
Wagon Trail, Las Vegas, NV 89118, including for a substantially
similar rent and duration as at the 4280 Wagon Trail facility. The
4280 Wagon Trail facility was initially established for
approximately 6,376 square feet of the facility, wherein tenant
built a second story mezzanine, for which it was not charged
additional rent although this expanded the facility to
approximately 12,348 square feet. July 2020 rent paid to landlord
at the 4280 Wagon Trail facility was $10,584.94, resulting in a
price per square foot of approximately $1.66 per month. Applying
this rate to the buildings at the Premises having 43,880 square
feet of warehouse and office space results in a monthly payment of
$72,840.80. Also, the 4280 Wagon Trail lease includes rental
adjustments of 3% annually, and is not a CPI-U rate-based
adjustment.

 

D.

In accordance with
the authorization and directive of the independent directors in
paragraph C above, MMDC analyzed the October payment of the 4280
Wagon Trail lease, resulting in a determination that additional
lease duration from 10 to 15 years of initial term, with two
options for 5 year extensions, and to reflect the current rent per
square foot paid at the 4280 Wagon Trail premises at the 4801 West
Bell Drive Premises.

 

E.

Landlord and Tenant
desire to enter into this Amendment for the purpose of updating the
lease to comply with the independent directors authorization and
the understanding of the lease by and between MMDC and RX
Land.

 

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. 

Amendments.

 

Section
3.1 of the Lease is hereby amended and restated in its entirety as
follows: Original:

 

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 July 16, 2020 and shall terminate on
June 30, 2030, (the “Lease Termination Date”), which is
the last day of the month preceding the tenth (10th) 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.

 

As
amended and restated:

 

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 July 16, 2020 and shall terminate on
June 30, 2035, (the “Lease Termination Date”), which is
the last day of the month preceding the fifteenth (15th)
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.

 

 

 

 

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

 

4.1
Rent. Commencing on
the date (“Rent Commencement Date”) which is July 16,
2020, 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 Seven Hundred Forty Seven Thousand Seven Hundred
Fifteen Dollars & 20/100ths Dollars ($795,096.00) (the
“Rent”). The Rent shall be payable in equal monthly
installments of Sixty Two Thousand Three Hundred Nine and 60/100
($62,309.60) 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.

 

As
amended and restated:

 

4.1
Rent. Commencing on
the date (“Rent Commencement Date”) which is July 16,
2020, 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 Eight Hundred Seventy Four Thousand Eighty Nine
Dollars & 60/100ths Dollars ($874,089.60) (the
“Rent”). The Rent shall be payable in equal monthly
installments of Seventy Two Thousand, Eight Hundred and Forty &
80/100ths dollars ($72,840.80) 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.

 

Section
4.2 of the Lease is hereby amended and restated in its entirety as
follows: Original:

 

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.

 

As
amended and restated:

 

4.2
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: July 1, 2021 and each annual period ending on
July1 thereafter
Rate of
increase: 3.0%

 

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.

 

Section
6.1 of the lease is hereby amended and restated in its entirety as
follows: Original:

 

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.

 

As
amended and restated:

 

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. In
the event that Tenant or Landlord shall make alterations adding a
mezzanine or second floor within the Premises, the rent shall not
be increased to reflect the increase in the square footage built or
created by the Tenant. By way of example, if a second floor or
mezzanine were to be added to the Premises, and such alteration
increased the building’s square footage from 43,880 square
feet to 50,000 square feet, rent shall continue at the rate as
described in Section 4.1, as such amount shall have been annually
increased in accordance with Section 4.2, and shall not reflect any
rent or additional rent due on the 6,120 square foot alteration
increase to the square footage.

 

 

 

 

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

 

LANDLORD:                                                                                        

TENANT:

Rx Land,
LLC                                                                                        

MM Development
Company, Inc.

a Nevada Limited
Liability Corporation

a Nevada Domestic
Corporation

 

BY: /s/ Larry
Scheffler

BY: /s/ Leighton
Koehler

   
    Larry Scheffler, Manager

Leighton
Koehler

  

Corporate
Secretary

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