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COURTHOUSE SQUARE LEASE AGREEMENT

Lease Agreement

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Global Food Technologies, Inc

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Title: COURTHOUSE SQUARE LEASE AGREEMENT
Date: 10/31/2008

COURTHOUSE SQUARE LEASE AGREEMENT, Parties: global food technologies  inc
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COURTHOUSE SQUARE

LEASE AGREEMENT

 

This Courthouse Square Lease Agreement ("Lease") is made and entered into this 30th day of September, 2008, by and between the CITY OF HANFORD, a municipal corporation, with its principal place of business in the City of Hanford, County of Kings, State of California (hereinafter referred to as "Landlord"), and Global Food Technologies, Inc., a Delaware Corporation with its principal place of business in the City of Hanford, County of Kings, State of California, (hereinafter referred to as "Tenant").

 

WITNESSETH: that;

 

The parties hereto, in consideration of the rental hereinafter reserved and the covenants and agreements hereinafter set forth, do make and enter into the following Agreement of Lease:

 

 

1.

PREMISES

 

Landlord hereby leases to Tenant and Tenant hereby hires and takes from Landlord, at the rental rate, and upon the conditions hereinafter set forth, those certain premises identified as 113 Court Street comprising and area of approximately 3,420 square feet of the Courthouse Square Building, together with all rights and appurtenances as set forth herein, being located in the City of Hanford, County of Kings, State of California, and more commonly known as 113 Court Street, Suites 205, 206, 207, 208, 209 & 210, Hanford, California 93230 (“Premises’).

 

113 Court Street, Hanford

Suite 205/206/207

1322 square feet

113 Court Street, Hanford

Suite 208

739 square feet

113 Court Street, Hanford

Suite 209

731 square feet

113 Court Street, Hanford

Suite 210

628 square feet

 

 

 

 

Total Premises Leased

3,420 square feet

 

 

2.

FACILITY COMMON AREAS

 

The term "common areas" means all areas and facilities outside the Premises and within the interior and exterior boundaries of the Courthouse Square Building within which the Premises is located that are provided and designated by Landlord from time to time for the general use and convenience of Tenant and of other tenants of the Courthouse Square Building and their respective authorized representatives and invitees. Common areas include, without limitation, walkways, decorative walls, plazas, malls, loading areas, roads, parking area and restrooms.

 

 

 


 

A.   Tenant's Right to Use:

 

Landlord gives to Tenant and its authorized representatives and invitees the non-exclusive right to use the common areas, with others who are entitled to use the common areas, subject to Landlord's rights as hereinafter set forth.

 

B.   Landlord's Maintenance and Management:

 

Landlord shall maintain the common areas in good condition at all times. Landlord shall have the right to:

 

1.   Establish and enforce reasonable rules and regulations applicable to all tenants concerning the maintenance, management, use, and operation of the common areas.

2.   Close any of the common areas to whatever extent required in the opinion of Landlord's counsel to prevent a dedication of any of the common areas or the accrual of any rights to any person or of the public to the common areas.

3.   Close temporarily any of the common areas for maintenance purposes.

4.   Designate other property outside the boundaries for the Courthouse Square Building to become part of the common areas.

5.   Select a person to maintain and operate any of the common areas if at any time Landlord determines that the best interests of the Courthouse Square Building will be served by having any of the common areas maintained and operated by that person. Landlord shall have the right to negotiate and enter into a contract with that person on such terms and conditions and for such period of time as Landlord deems reasonable and proper both as to service and as to cost.

6.   Make changes to the common areas including, without limitation, changes in the location of driveways, entrances, exits, or the direction of the flow of traffic so long as such changes do not unreasonably interfere with Tenant's use and possession of the Premises.

 

C.   Tenant's Share of Cost:

 

Tenant shall pay to Landlord, on a monthly basis, an amount calculated by Landlord to be Tenant's share of Common Area Costs (as defined in this paragraph), on the first day of each month, commencing on the date the term commences, or on the first day of the month following the month the term commences if the term commences on a day other than the first day of a month as the case may be, and continuing during the term or any extension thereof.

Tenant's proportionate share of Common Area Costs shall be calculated by multiplying the total Common Area Costs times the ratio of the total number of square feet in the Premises to the total number of leasable square feet in the Courthouse Square Building. Common Area Costs that cover a period not within the term of this Lease shall be prorated.

Landlord can adjust the monthly Common Area Costs July 1 st of each year of the lease term, on the basis of Landlord's calculation of Common Area costs for the next year of the lease term.

Landlord shall furnish to Tenant a statement showing the total Common Area Costs, Tenant's share of Common Area Costs for that respective year of the lease term, and the monthly payments to be made by Tenant for that next year. For the time period commencing on the date of this Lease through September 30, 2009, Tenant's monthly Common Area Cost shall be Five Hundred Eighteen Dollars and Seventy-five Cents ($518.75).

 

 

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For purposes hereof, the term "Common Area Costs" shall include, but is not limited to, the real property taxes and assessments and other taxes and assessments of any nature levied or assessed against the Common Areas and the Courthouse Square Building, or assessed against Landlord as a result of the Common Areas or the Courthouse Square Building, all natural gas and electrical charges assessed against the Common Areas, all of Landlord's cost for any type of insurance for the Common Areas and the Courthouse Square Building, all sums expended by Landlord for property management and maintenance and operation of the Common Areas, and the cost of natural gas service for the Premises.

Costs of maintenance and operation of the Common Areas shall include, without limitation, cleaning, sweeping and other janitorial services, policing, maintenance of refuse receptacles, security systems, parking lot maintenance, planting and relandscaping, directional signs and other markers, lighting and other utilities and premiums for public liability and property damage insurance, and other costs necessary in Landlord's judgment for the maintenance and operation of the Common Areas.

 

 

3.

TERM OF LEASE

 

The term of this lease shall be for a period of two (2) years, effective, October 1, 2008 and ending at midnight, Pacific Standard Time or Pacific Daylight Time, whichever is applicable, September 30, 2010.

 

A.   Delivery of Possession:

 

Tenant agrees that, in the event of the inability of Landlord to deliver possession of the Premises to Tenant on the date above specified for the commencement of this Lease, this Lease shall not be void or voidable, nor shall Landlord be liable to Tenant for any loss or damage resulting therefrom, nor shall the expiration date of the above term be in any way extended, but, in such event, Tenant shall not be liable for any rent until such time as Landlord delivers possession of the Premises to Tenant.

 

The provisions of Subsection (1) of Section 1932 of the California Civil Code shall not apply to this Lease, and Tenant waives the benefit of such provisions.

 

Should Landlord tender possession of the Premises to Tenant prior to the date specified for commencement of the term thereof, and Tenant elects to accept such prior tender, such prior occupancy shall be subject to all of the terms, covenants, and conditions of this Lease, except payment of rent. By entering into and occupying the Premises, Tenant shall be deemed to acknowledge that the Premises are in good order and repair.

 

 

Page 3


 

 

B.   Surrender of Premises:

 

Tenant agrees to surrender the Premises at the termination of the tenancy herein created to Landlord including all of the Tenant's improvements and alterations in good condition (except for ordinary wear and tear occurring to the Premises and except for alterations that Tenant has the right to remove or is obligated to remove under the provisions of this Lease). Tenant shall remove all its personal property prior to the date of termination of the tenancy and shall remove all other improvements and alterations to the Premises if Landlord directs Tenant to do so, at Tenant's sole cost and expense. Tenant shall perform all restoration made necessary by the removal of any alterations or Tenant's personal property prior to termination of the tenancy.

 

Landlord can elect to retain or dispose of in any manner any alterations or Tenant's personal property that Tenant does not remove from the Premises upon termination of the tenancy as allowed or required by this Lease by giving at least ten (10) days notice to Tenant. Title to any such alterations or Tenant's personal property that Landlord elects to retain or dispose of on expiration of the ten (10) day period shall vest in Landlord. Tenant waives all claims against Landlord for any damage to Tenant resulting from Landlord’s retention or disposition of any such alterations or Tenant's personal property. Tenant shall be liable to Landlord for Landlord's cost for storing, removing and disposing of any alterations of Tenant's personal property.

 

If Tenant fails to surrender the Premises to Landlord on the termination of the tenancy, Tenant shall indemnify, defend and hold Landlord harmless from any claims, damages, costs, expenses and attorney’s fees incurred by Landlord as a result of Tenant's failure to surrender the Premises.

 

If Tenant shall fail to remove all of its effects from said Premises upon termination of this Lease for any cause whatsoever, Landlord may, at its option, remove the same in any manner that Landlord shall choose, and store said effects without liability to Tenant for loss thereof, and Tenant agrees to pay Landlord upon demand any and all expenses incurred in such removal including court costs and attorney’s fees and storage charges on such effects for any length of time that the same shall be in Landlord's possession, or Landlord may, at its option, without notice, sell said effects, or any of the same, at private sale and without legal process, for such price as Landlord may obtain and apply the proceeds of such sale upon any amounts due under this Lease from Tenant to Landlord and upon the expense incident to the removal and sale of said effects.

 

C.  Holding Over:

 

If Tenant holds over after the expiration or earlier termination of the term of this Lease, Tenant shall become a Tenant at sufferance only, at the rental rate of 150% of the rental rate in effect on the date of such expiration and otherwise upon the terms, covenants and conditions herein specified, so far as applicable.

 

 

Page 4


 

 

If Tenant, with Landlord's express written consent, remains in possession of the Premises after expiration or earlier termination of the term hereof, such possession shall be deemed a month-to-month tenancy, terminable on thirty (30) days written notice given at any time by either party, and at the rental rate in effect upon the date of such expiration and otherwise upon the terms, covenants, and conditions herein specified, so far as applicable. Acceptance by Landlord of rent after such expiration or earlier termination shall not constitute a holdover hereunder or result in a renewal of this Lease.

 

 

4.

RENT

 

Tenant agrees to and shall pay to Landlord as rent for the Premises the following:

 

A.   Monthly Rent:

 

Tenant agrees to pay Landlord as the total rent for the Premises for the period of October 1, 2008 through September 30, 2010 Eighty-two Thousand and Eighty Dollars ($82,080) in equal monthly installments of Three Thousand Four Hundred Twenty Dollars ($3,420). Rental payments pursuant to this section shall be paid each in advance on the first day of each and every calendar month during said term, except that the first month's rent shall be paid upon the execution of this Lease. In the event the term of this Lease commences or ends on a day other than the first day of a calendar month, then the rental for such periods shall be prorated in the proportion that the number of days this Lease is in effect during such period bears to thirty (30) days, and such rental shall be paid at the commencement of such periods. Said rental shall be paid to Landlord, without deduction offset, prior notice or demand, in lawful money of the United States of America, which shall be legal tender at the time of payment, at the office of Landlord or to such other person or at such other place as Landlord may, from time to time, designate in writing.

 

Tenant shall pay to Landlord, concurrent with the effectiveness of this Lease, an amount equal to the first and last month's rent of the Premises.

 

C.   Rental Adjustment

 

Commencing with the thirteenth (13th) full calendar month of the term of this Lease, and at the end of each twelfth (12th) month thereafter, during the term, the Monthly Rent as described in Section 4A of this Lease Agreement for the ensuing twelve (12) month period ("Adjustment Period") shall be increased by 5.0%.

 

D.   Security Deposit:

 

On execution of this Lease, Tenant shall deposit with Landlord an amount equal to one month’s rent as a security deposit for the performance by Tenant of the provision of this Lease. If Tenant is in default, Landlord can use the security deposit, or any portion of it, to cure the default or to compensate Landlord for all costs and damages sustained by Landlord resulting from Tenant’s default. Tenant shall immediately on demand, pay to Landlord a sum equal to the portion of the security deposit expended or applied by Landlord as provided in this paragraph so as to maintain the security deposit in the sum initially deposited with Landlord. If Tenant is not in default at the expiration or termination of this Lease, Landlord shall return the security deposit to Tenant. Landlord’s obligations with respect to the security deposit are those of a debtor and not a trustee. Landlord can maintain the security deposit separate and apart from Landlord’s general funds or can co-mingle the security deposit with Landlord’s general and other funds. Landlord shall not be required to pay Tenant interest on the security deposit.

 

 

Page 5


 

E.   Late Charge

 

Tenant acknowledges that late payment by Tenant to Landlord of rent will cause Landlord to incur costs not contemplated by this Lease, the exact amount of such costs being extremely difficult and impracticable to fix. Such costs include, without limitation, processing and accounting charges, and late charges that may be imposed on Landlord by the terms of any encumbrance and note secured by any encumbrance covering the Premises. Therefore, if any installment of rent due from Tenant is not received by Landlord within ten (10) days from the date when said rent was due, Tenant shall pay to Landlord an additional sum of Ten Percent (10%) of the overdue rent as a late charge. The parties agree that this late charge represents a fair and reasonable estimate of the costs that Landlord will incur by reason of late payment by Tenant. Acceptance of any late charge shall not constitute a waiver of Tenant's default with respect to the overdue amount, nor prevent Landlord from exercising any of the other rights and remedies available to Landlord.

 

 

5.

TAXES AND ASSESSMENTS

 

A.   Personal Property and Possessory Interest Taxes:

 

If during the term of this Lease or any extension thereof, Tenant is required to pay taxes as defined below, Tenant, shall be liable for and shall pay ten (10) days before delinquency all taxes, assessments, license fees, and other charges ("Taxes") that are levied and assessed against Tenant's personal property or trade fixtures installed or located in or about Premises or Tenant's possessory interest in the Premises, and that become payable during the Lease term. On demand by Landlord, Tenant shall furnish Landlord with satisfactory evidence of these payments.

 

If any taxes on Tenant's personal property, trade fixtures or possessory interest are levied against Landlord or Landlord's property, or if the assessed value of the Premises is increased by the inclusion of a value on Tenant's personal property, trade fixtures or possessory interest and if Landlord pays the Taxes on any of these items of the Taxes based on the increased assessment of these items, which Landlord shall have the right to do regardless of the validity thereof, but only under proper protest if requested by Tenant, Tenant shall on demand, immediately reimburse Landlord for the sum of the Taxes levied against Landlord, or the proportion of the Taxes resulting from the increase in Landlord's assessment.

 

 

Page 6


 

If Tenant's improvements on the Premises, whether installed and/or paid for by Landlord or Tenant and whether or not affixed to the real property so as to become a part thereof, are assessed for Real Property tax purposes at a valuation higher than the valuation at which Tenant's improvements are assessed, then the Real Property taxes and assessments levied against Landlord or the Premises by reason of such excess assessed valuation shall be deemed to be taxes levied against personal property of Tenant and shall be governed by the provisions of the above. If the records of the County Assessor are available and sufficiently detailed to serve as a basis for determining whether said Tenant improvements are assessed at a higher valuation, such records shall be binding on both Landlord and Tenant. If the records of the County Assessor are not available or sufficiently detailed to serve as a basis for making said determination, the actual cost of construction shall be used.

 

B.   Tenant Acknowledgment Of Possessory Interest Taxes

 

Tenant acknowledges, understands and agrees that: (1) this Lease may create a possessory interest in Tenant which may be subject to real property taxes; (2) the property interest of Tenant created by this Lease may be subject to property taxes; and (3) this Lease may be subject to property taxes. Tenant agrees to pay all such taxes, as identified above, before the same become delinquent.

 

 

6.

USE OF PREMISES

 

A.   Permitted Use:

Tenant shall use the Premises for Corporate Business Offices and for no other use without Landlord's consent. Tenant shall conduct its business at the Premises as Global Food Technologies, Inc.

 

B.   Prohibited Use:

 

Tenant shall not use or occupy the Premises in violation of law or of the Certificate of Occupancy issued for the Premises, and shall, upon five (5) days written notice from Landlord, discontinue any use of the Premises declared by any governmental authority having jurisdiction including but not limited to Landlord, which shall, by reason of the nature of Tenant's use or occupancy of the Premises, impose any duty upon Tenant or Landlord with respect to the Premises or with respect to the use or occupancy thereof. Tenant shall not do or permit to be done anything which will invalidate, cause cancellation or increase the cost of any fire, extended coverage of any other insurance policy covering the Premises and/or property located therein and shall comply with all rules, orders, regulations. and requirements of the Pacific Fire Rating Bureau or any other organization performing a similar function.

 

If the rate of any insurance carried by Landlord is increased as a result of Tenant's use, Tenant shall pay to Landlord within ten (10) days before the date Landlord is obligated to pay a premium on the insurance, or within fifteen (15) days after Landlord delivers to Tenant a certified statement from Landlord's insurance carrier stating that the rate increase was caused solely by an activity of Tenant on the Premises as permitted in this Lease, whichever date is later, a sum equal to the difference between the original premium and the increased premium.

 

 

Page 7


 

Tenant shall comply with all laws concerning the Premises or Tenant's use of the Premises, including, without limitation, the obligation at Tenant's cost to alter, maintain, or restore the Premises in compliance and conformity with all laws relating to the condition, use or occupancy of the Premises during the term of this Lease.

 

Tenant shall promptly, upon demand, reimburse Landlord for any additional premium charged for such policy by reason of Tenant's failure to comply with the provisions of this article.

 

Tenant shall not use or allow the Premises to be used for any improper, immoral, unlawful, or objectionable purpose, nor shall Tenant cause, maintain or permit any nuisance in, on or about the Premises.

 

Tenant shall not use the Premises in any manner that will constitute waste, nuisance, or unreasonable annoyance (including, without limitation, the use of loudspeakers or sound or light apparatus that can be heard or seen outside the Premises) to other tenants in the Facility in which the Premises are located.

 

Tenant shall not use the Premises for sleeping, washing clothes, cooking, or the preparation, manufacture, or mixing of anything that might emit any odor or objectionable noises or lights onto the Premises.

 

No secondhand store, auction, distress or fire sale, or bankruptcy or going out-of-business sale may be conducted on   the Premises without Landlord's consent. Tenant shall not sell or display merchandise outside the confines of the Premises.

 

Tenant shall not do anything on the Premises that will cause damage to the Premises.

 

The Premises shall not be overloaded. No machinery, apparatus, or other appliance shall be used or operated in or on the Premises that will in any manner injure, vibrate, or shake the Premises.

 

Tenant will not, without the written consent of Landlord, either use any apparatus or devise in connection with the Premises which will in any way increase the amount of electricity or water usually furnished or supplied to the Premises, or connect with the electric current or with water any apparatus or device for the purpose of using electric current or water.

 

Throughout the term of this Lease, Tenant, at its sole cost, shall maintain the Premises in compliance with the Americans With Disabilities Act of 1990 and the regulations related thereto.

 

 

Page 8


 

 

7.

LEASEHOLD IMPROVEMENTS

 

Tenant shall, at its own cost and expense, furnish and install all leasehold improvements. Said improvements shall be subject to Landlord's prior written consent thereto and shall be in accordance with the plans and specifications first approved by Landlord.

 

Tenant covenants and agrees that all work done by Tenant shall be performed in full compliance with all laws, rules, orders, ordinances, directions, regulations, and requirements of all governmental agencies, offices, departments, bureaus and board having jurisdiction and in full compliance with the rules, orders, directors, regulations and requirements of the Pacific Fire Rating Bureau and of any similar body. Tenant shall keep the Premises and all improvements thereon, free from all liens and claims of mechanics, labors, materialmen and others for work done and materials furnished to Tenant and Tenant shall not create or suffer to be created any lien or encumbrance on the Premises.

 

All alterations, decorations, additions or improvements upon the Premises made by Tenant shall, unless Landlord elects otherwise, become the property of Landlord, and shall remain upon, and   be surrendered with the Premises, as a part thereof, at the end of the Lease term, except that Landlord may, by written notice to Tenant, given at least thirty (30) days prior to the end of the Lease term, require Tenant to remove all improvements installed by Tenant, and Tenant shall repair or, at Landlord's option, pay to Landlord all costs arising from such removal.

 

All articles or personal property and all business and trade fixtures, machinery, and equipment, furniture and movable partitions owned by Tenant or installed by Tenant at its expense in the Premises, shall be and remain the property of Tenant and may be removed by Tenant at any time during the term of this Lease when Tenant is not in default hereunder. If Tenant shall fail to remove all of its effects from the Premises upon termination of this Lease for any cause whatsoever, Landlord may, at its option, remove the same in any manner that Landlord shall choose, and store said effects with liability to Tenant for loss thereof, and Tenant agrees to pay Landlord upon demand any and all expense incurred in such removal, including court costs and attorney’s fees and storage charges on such effects for any length of time that the same shall be in Landlord's possession, or Landlord may, at its option, without notice, sell said effects or any of the same, at private sale and without legal process, for such price as Landlord may obtain and apply the proceeds of such sale upon any amounts due under this lease from Tenant to Landlord and upon the expense incident to the removal of and sale of said effects.

 

 

8.

TENANT'S MAINTENANCE

 

Tenant has examined and inspected and knows the condition of the Premises and every part thereof and has received the same in good order and repair and accepts the same in its present condition. Tenant shall, at Tenant's sole cost and expense keep the Premises and every part thereof, including, but not limited to, all Tenant's personal property, storefronts, plate glass, signs, windows, heating and air condition systems in good condition and repair, damage thereto from causes beyond the reasonable control of Tenant and ordinary wear and tear excepted. Tenant shall, upon the expiration or sooner termination of the hereof, surrender the Premises to Landlord as improved by Tenant, ordinary wear and tear excepted.

 

 

Page 9


 

If, at any time, Premises shall fall into disrepair, Tenant shall have thirty (30) days from the date of receipt of written notice of such disrepair from Landlord to make the necessary repairs to place the Premises in good condition. If said repairs are not completed within said thirty (30) day period, Landlord may enter the Premises and begin to complete the necessary repairs and Tenant agrees to immediately reimburse Landlord for the cost of said repairs upon presentation by Landlord to Tenant a bill for said repairs.

 

Landlord shall have no obligation to maintain, alter, remodel, improve, repair, decorate or paint the Premises or any, part thereof and the parties hereto affirm that Landlord has made no representations to Tenant in respect of the condition of the Premises except as specifically set forth herein.

 

 

9.

ALTERATIONS

 

Except as otherwise contained herein, Tenant shall not make any structural or exterior alterations to the Premises without Landlord’s consent, Tenant may make nonstructural alterations to the interior of the Premises that Tenant requires in order to conduct its business on the Premises. In making any alterations that Tenant has a right to make, Tenant shall comply with the following:

 

A.   Tenant shall submit to Landlord reasonably detailed final plans and specifications and working drawings of the proposed alterations and the name of its contractor at specifications least thirty (30) days before the date it intends to commence the alterations.

 

B.   The alterations shall not be commenced until two (2) days after Landlord has received notice from Tenant stating the date the installation


 
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