One West Wetmore
Road
OFFICE LEASE
This date of this lease ("Lease")
is January 5, 2006.
1.
FUNDAMENTAL INFORMATION:
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(a)
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Landlord is Issa and Henrietta
Hallaq, as husband and wile.
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(b)
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Tenant is Nord Resources
Corporation, a Delaware Corporation whose address is One West
Wetmore Road, Suite 203, Tucson, Arizona, 85705.
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(c)
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The term of this lease shall be
for the period which commences and ends on the dates set forth on
Exhibit A unless sooner terminated pursuant to any provision
hereof.
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(d)
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Tenant shall pay Landlord a
monthly rental as stated on Exhibit A in lawful money of the United
States of America for each and every month of the lease (plus any
tax other than net income and estate taxes levied by any Federal,
State or local authority upon the rental or the receipt thereof),
payable in advance on the first day of each month commencing with
the commencement date of the lease. Rent for any period during the
term hereof which is for less than one month shall be a pro-rata
portion of the monthly installment. Rent shall be payable to
Landlord at the address stated herein or to such other persons or
at such other places as Landlord may designate in
writing.
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(e)
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The Premises are commonly known
as Suite 203, One West Wetmore Road, Tucson, Arizona, 85705,
consisting of approximately 3,000 square feet.
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(f)
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Tenant's Percentage is 30.00
%.
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(g)
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Tenant's Security Deposit is $
4,592.55.
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(h)
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Tenant's use of the Premises
shall be for general office uses.
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(i)
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Tenant's base year shall be the
Calendar Year 2006.
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2.
PREMISES: Landlord
leases the Premises to Tenant and Tenant leases the Premises from
Landlord for the term, at the rental, and on all the terms,
covenants and conditions of this Lease. The Premises are a part of
the real property located at One West Wetmore Road, Tucson, Arizona
(the "Property").
3.
IMPROVEMENTS:
Landlord, at Landlord's sole cost and expense using building
standard materials and workmanship shall construct the tenant
improvements for the Lease Premises (including paint and carpet)
according to a mutually acceptable space plan attached hereto as
Exhibit B. Landlord shall prepare the suite to be "Move-In" ready
for Tenant as part of the proposed improvements.
4.
(a)
COMMENCEMENT DATE:
The commencement date of the lease term ("Commencement Date") shall
begin on or before June 1, 2006.
(b)
EARLY OCCUPANCY AND
HOLDING OVER: If the Landlord permits Tenant to
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occupy the
Premises prior to the Commencement Date (early occupancy period)
all terms and conditions of this Lease shall be deemed in effect.
If Tenant remains in possession of the Premises after this Lease
terminates without Landlord's written consent, Tenant's occupancy
shall be a tenancy from month-to-month subject to all provisions of
this Lease and Tenant shall pay rent for each month in the amount
of 125% of the monthly rent which applied to the last month of the
term plus all other charges payable under this Lease.
(c)
FAILURE OF TENANT
TO TAKE POSSESSION: Tenant's inability or failure to take
possession of the Premises when delivered by Landlord shall not
delay the commencement of the term of this Lease or Tenant's
obligation to pay rent.
5.(a) RENT: Tenant
shall pay to Landlord without notice or demand, at the address
shown in the lease or as Landlord may notify Tenant in writing from
time to time, the rent specified in paragraph 1.d. above, as
adjusted pursuant to the provisions of this Lease, in advance, on
the first day of each month, commencing on the Commencement Date;
provided, however, that if the Commencement Date occurs on a day
other than the first day of the month, Tenant shall pay to the
Landlord, on the Commencement Date, the prorata amount of monthly
rent from the Commencement Date to the end of that month and on the
first day of each succeeding month thereafter the monthly
installments of rent shall be paid. In addition, and together with
each monthly installment of rent, Tenant shall pay to Landlord all
rental, sales, excise or use taxes measured or imposed upon rent or
the receipt of rent.
(b)
SECURITY DEPOSIT:
Tenant shall deposit with Landlord upon execution hereof the
Security Deposit specified in paragraph 1.g. above as security for
tenant's faithful performance of Tenant's obligations hereunder. If
Tenant fails to pay rent or other charges due hereunder, otherwise
defaults with respect to any provision of this Lease, Landlord may
immediately use, apply or retain all or any portion of said deposit
for the payment of any such unpaid rent or other charge or for the
payment of any other sum for which Tenant may become obligated by
reason of tenant's default, to compensate Landlord for any loss or
damage which Landlord may suffer thereby. If Landlord so uses or
applies all or any portion of said deposit, Tenant shall within
five (5) days after written notice demand therefore deposit
cash with Landlord in an amount sufficient to restore said deposit
to the full amount hereinabove stated and Tenant's failure to do so
shall be a material breach of the Lease. Landlord shall not be
required to keep said deposit separated from its general accounts.
Any interest generated from said deposit shall accrue to the
benefit of Landlord. If, after the expiration of the Lease term,
Tenant has performed all of Tenant's obligations hereunder, said
deposit, so much thereof as has not therefore been applied by
Landlord, shall be returned within a reasonable time, without
payment of interest or other increment for its use, to Tenant (or,
at Landlord's option to the last assignee, if any, of Tenant's
interest hereunder) after Tenant has vacated the Premises. This
paragraph shall be construed as cumulative of and not in conflict
with Landlord's rights under Paragraph 14 of this Agreement. In no
event shall this security deposit be considered as, or be used for
or applied against, the last month's rent.
(c)
OPERATING EXPENSE
INCREASES: Tenant shall reimburse Landlord, as additional rent,
Tenant's Percentage of the increase, if any, of the Operating
Expenses (as defined below) for any calendar year during the term
of this Lease over the Operating Expenses during the Base Year. The
Operating Expenses incurred during the Base Year shall be deemed
the Base Year Expenses. The term "Operating Expenses" shall include
all operating costs incurred by Landlord in owning, maintaining and
operating the Property including without limitation the following
costs: (1) utilities and trash removal; (2) cleaning, repair,
replacement and maintenance of the Property including the parking
lots, Common Area, landscaping, buildings, air conditioning systems
and roofs; (3) landscaping services; (4) insurance (including
public liability, property damage, earthquake, and fire and
extended coverage insurance for the
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full
replacement cost of the Property); (5) supplies; (6) management of
the Property, whether managed by Landlord or an independent
contractor (not to exceed industry standards); (7) costs,
expenditures or charges (whether capitalized or not) required by
any governmental authority; (8) amortization of capital expenses
(including financing costs) over the useful life of the capital
expenditure when (1) required by a governmental entry for energy or
water conservation or life safety purposes, or (ii) made by
Landlord to reduce Operating Expenses; and (9) any other costs or
expenses reasonably incurred by Landlord in connection with the
Property. Operating Expenses shall not include leasing costs and
tenant improvement costs, or services not uniformly available to or
performed for substantially all tenants of the Property.
After
the end of each calendar year following the Base Year, Landlord
shall submit to Tenant a statement prepared by Landlord showing the
total amount expended by the Landlord for Operating Expenses and
showing the Base Year Expenses. Tenant's share of any increase in
Operating Expenses over the Base Year Expenses shall be paid to the
Landlord by the Tenant within ten (10) days after the receipt of
the statement. The statement shall itemize the costs and expenses
and the amount of the increase in reasonable detail. If this Lease
terminates other than at the end of a calendar year, the costs and
expenses shall be prorated for that portion of the calendar year
prior to such termination. Upon request, Landlord shall supply
tenant such records, invoices, and proof of expenditures that may
be reasonably requested to confirm the accuracy of the Landlord's
statement but only for the prior 12 months.
6.(a)
COMMON AREA: The term "Common Area" means all areas and facilities
of the Property that are provided for the general use and
convenience of Tenant and other Tenants of the Property and their
invitees. Common Area includes without limitation, pedestrian
walkways and patios, landscaped areas, sidewalks, common restrooms,
if applicable, and parking areas. The Tenant and its invitees are
granted the non-exclusive right to use the Common Area with others
who are entitled to use the Common Area subject to the
following:
(b)
PARKING: Provided
Tenant is not in default hereunder, Tenant shall have the
nonexclusive right to use the parking areas on the Property during
the term of this Lease, for automobile parking and access purposes,
subject to the full and complete right of Landlord to designate
certain regulations adopted by Landlord. No delay or failure by
Landlord to enforce its parking rules and regulations or its other
rights hereunder, and no waiver by Landlord of any breach therefore
shall be deemed to be a waiver of any succeeding breach or prevent
any subsequent or other enforcement thereof by Landlord.
Tenant shall have
the exclusive right to use two (2) reserved covered parking spaces
at no additional charge as defined hereto as Exhibit C.
(c)
RULES AND
REGULATIONS: Landlord shall have the right from time to time to
establish and modify reasonable rules and regulations for tenants,
invitees, customers and guests concerning the maintenance,
management, use, and operation of the Common Area; provided,
however, that none of the rules and regulations shall alter, affect
or modify any of the terms and conditions of this Lease. The rules
and regulations in effect at the time this Lease is executed are
attached hereto.
(d)
MAINTENANCE AND
REPAIR OF COMMON AREA: Landlord shall keep the Common Area in good
condition and repair at all times during the term of this
Lease.
(e)
REPAIRS AND
ALTERATIONS: Landlord reserves the right to make necessary,
reasonable or desirable repairs and alterations to the Common Area;
provided, however, that no change or alteration in the Common Area
shall unreasonably impair or impede the use by the
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Tenant of
the Common Area. Landlord will use its best efforts to cause
repairs and alterations to be made at a time that will minimize
interference with Tenant's business.
(f)
TRASH AND WASTE
COLLECTION: Tenant, or janitor employed by Tenant, shall deliver
all of its waste to the designated area for collection and shall
not place or permit waste containers of any type in any areas
except the collection area designated by Landlord. Tenant shall pay
all costs in connection with the removal from the trash storage
area of and disposition of trash and garbage generated by the
Tenant's if said trash is in excess of that normally generated in a
business office, together with all other janitorial expenses as
hereinafter stated.
7.(a)
USE: Tenant shall use the Premises
for the purpose set forth in paragraph 1 .h. above and no other use
without Landlord's prior written consent.
(b)
CONTINUOUS USE:
Tenant shall not leave the Premises unoccupied or vacant for more
than thirty (30) consecutive days but shall continuously occupy the
premises during the entire term of this Lease.
(c)
COMPLIANCE WITH
LAW: Tenant shall at its own expense comply promptly with all
municipal, county, state and federal statutes, ordinances, rules,
regulations, orders and requirements regulating Tenant's use of the
Premises in effect during all or any part of the term. Tenant shall
not use or permit the use of Premises in any manner that tends to
cause waste, nuisance or unreasonable annoyance including, without
limitation, the use of loudspeakers or sound or light apparatus
that can be seen or heard outside the Premises.
(d)
INSURANCE: Tenant,
at its sole expense, shall comply with any and all requirements of
any insurance organization or company for the maintenance of
reasonable fire and public liability insurance covering the
Premises or the Property.
(e)
INSTALLATION: The
installation and location of all machinery, electric wiring, and
plumbing shall be subject to the prior written approval of
Landlord, which approval will not be unreasonably
withheld.
(f)
CONDITION OF THE
PREMISES: The Landlord represents that the Premises are zoned,
pursuant to the ordinances of the City of Tucson, for general
office purposes.
(g)
ADVERTISING AND
SIGNS: Tenant shall not place or permit to be placed any sign,
advertisement, or any object on the Property or on the exterior
walls of the Premises or the windows, or doors of the Premises or
in the Common Area, nor make any change thereto without the prior
written consent of Landlord, which will not be unreasonably
withheld.. If Tenant shall do so Landlord may reenter the Premises
and remove the same at Tenant's expense and without notice or
obligation to the Tenant. At the termination of this Lease, or an
extension thereof, Tenant shall remove all signs of any nature
placed on the Property and shall leave the Property free of any
signs placed by Tenant. Any damage to the Premises or the Property
caused by the installation, maintenance or removal of Tenant's
signs shall be repaired at Tenant's sole cost and
expense.
(h)
HAZARDOUS
MATERIALS: Tenant shall comply with all existing and any hereafter
enacted laws or orders regulating any matter which is reasonably
determined by landlord or any governmental entity to be hazardous
or toxic material ("Hazardous or Toxic Materials"). Tenant shall
'indemnify, defend and hold harmless Landlord from and against any
and all claims, demands, judgments, damages, liabilities, costs and
expenses of any kind whatsoever in connection with or arising out
of any spills or discharges of any Hazardous or Toxic Material due
to, contributed to, or caused by Tenant, its principals, employees,
customers, clients or invitees. Tenant shall surrender the Premises
free
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of any
Hazardous or Toxic Materials. Tenant's obligations with respect to
any Hazardous or Toxic Material shall not terminate upon the
expiration or other termination of this Lease.
8.
MAINTENANCE,
REPAIRS AND ALTERATIONS:
(a)
TENANT'S
OBLIGATIONS: By taking possession of the Premises, Tenant shall be
deemed to have accepted the Premises as being in a good and
sanitary order, condition and ,; v repair. Tenant shall maintain
and repair the Premises (including tenant improvements, interior
ji_VO glass, entry and interior doors, carpeting, windows and
window coverings, paint, equipment and tili personal property
located within the Premises) in good condition and repat and, at
the end of the lease, leave the premises in good condition
(ordinary wear and tear exfeted), and broom clean. Tenant shall
repair any damage caused by the removal of its trade fixtures,
furnishings and equipment and shall patch and fill holes and repair
any damage caused by the removal. Tenant shall be liable for any
damage to the Property (including buildings, other tenants'
premises, Common Area, fixtures, equipment and personal property)
resulting from the intentional or negligent act or omission of
Tenant, its employees or invitees. Tenant shall be responsible for
the costs of all janitorial services.
(b)
LANDLORDS
OBLIGATIONS: Except for items caused by the intentional or
negligent act or omission of Tenant, its employees or invitees,
Landlord shall maintain, in good condition (the cost for which is
covered under paragraph 5(c), the structural part of the building
and other improvements in which the Premises are located, including
the foundation, bearing and exterior walls (excluding doors)
subflooring and roofs, the unexposed electrical, plumbing and sewer
systems, the heating, ventilation and air conditioning equipment
serving the Premises, except for that which the Tenant is required
to maintain pursuant to subparagraph (a) above.
Landlord shall not be liable for
any failure to make repairs, or to perform any maintenance unless
such failure shall persist for an unreasonable time (which is
hereby deemed to be, in most cases, 10 days unless the repairs
cannot reasonably be made in that timeframe) after written notice
of the need for said repairs and maintenance is given to the
Landlord b) Tenant. There shall be no abatement of rent and no
liability of Landlord by reason of any injury to or interference
with Tenant's business arising from the making of any repairs,
alterations or improvements in or to any portion of the Premises,
the Property, or to fixtures, appurtenances and equipment therein.
Landlord shall have no obligation to shampoo or replace the
carpeting or draperies of the Premises during the term or any
extension thereof. Landlord shall have no obligation to alter,
remodel, improve, repair, decorate, or paint the Premises or any
part thereof.
(c)
FAILURE TO PERFORM:
If Tenant fails to perform its obligations under this Paragraph 8,
Landlord may, at its option, enter the Premises and correct the
condition after ten (10) days written notice to Tenant or
immediately if the condition affects health or safety. Tenants
shall pay Landlord's reasonable cost of the repair immediately upon
demand together with interest at the rate of eighteen percent (18%)
per annum from the date Landlord performed the repair and until the
amount is paid.
(d)
ALTERATIONS: Tenant
shall make no alterations, decorations, additions or improvements
in or to the Premises without Landlord's prior written consent,
which shall not be unreasonably withheld, and then only by
contractors or mechanic approved by landlord, which approval shall
not be unreasonably withheld. All such work shall be done at such
time and in such manner as Landlord may from time to time
designate. All work done by or pursuant to the direction and
instruction of Tenant shall be performed in full compliance with
all laws, ordinances, regulations and requirements of all
governmental agencies having jurisdiction. Before commencing any
work, tenant shall give Landlord at least five (5) days
written notice of the proposed commencement of such work and shall,
if required by Landlord, secure at Tenant's
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own
expense, a completion and lien indemnity bond, satisfactory to
Landlord for said work.
(e) LIENS: Tenant shall keep the
Premises, the building and the property upon which the building is
situated, free from any liens arising out of the work performed,
materials furnished, or obligations incurred by Tenant. Tenant
further covenants and agrees that should any mechanic's lien be
filed against the Premises or against the building for work claimed
to have been done for, or materials claimed to have been furnished
claimed to have been furnished to Tenant, said lien will be
discharged within (10) days after the filing thereof, at the cost
and expense of Tenant.
9. UTILITIES: Tenant agrees to
pay all gas, heat, electric power, telephone service and all other
utilities services provided to the Premises and all such services
shall be in the name of Tenant without responsibility to Landlord,
except water service and sewer service.
10.
REAL PROPERTY
TAXES:
(a)
Tenant shall pay
Tenant's Percentage of the increase of all real property taxes and
assessments levied or assessed against the Property in excess of
the real property taxes and assessments levied or assessed against
the Property for the Base Year. Landlord shall notify Tenant of
Landlord's calculation of Tenant's share of such increase, and
together with such notice, shall furnish Tenant with a copy of the
appropriate tax bills. Tenant may be required to pay its share of
any such increase semi-annually not later than ten (10) days before
the taxing authority delinquency date (November 1 St and
May 1') or ten (10) days after receipt of the notice, whichever is
later. If the final year of this Lease is less than a full calendar
year, the amount of the increase shall be prorated to reflect the
portion of such calendar year that this Lease is in
effect.
(b)
Tenant shall pay
before delinquent all taxes levied against trade fixtures,
furnishings, equipment, improvements and all other personal
property located on or about the Premises. Tenant shall attempt to
have the trade fixtures, furnishings, fixtures, equipment and all
other personal property assessed separately from the real property
and billed directly to Tenant. If any property is assessed with
Landlord's real property, Tenant shall pay Landlord the taxes
attributable to the personal property within thirty (30) days after
demand by Landlord containing a written statement showing the taxes
on the personal property
(c)
Tenant agrees to
pay all taxes, except income tax, which may be levied or assessed
upon any rent payment made by Tenant to Landlord.
(d)
Landlord's failure
to notify Tenant within the time period referenced above to pay its
proportionate share of the taxes specified in subparagraphs (b) and
(c) shall not serve as a waiver by Landlord of these
amounts.
11.
INSURANCE:
(a)
LIABILITY
INSURANCE: Tenant, at its expense, shall obtain and keep in force
during the term of this Lease, a policy of comprehensive public
liability insurance, insuring Landlord and Tenant against liability
arising out of the use or occupancy of the Premises. Such insurance
shall provide for a limit of liability of not less than ONE MILLION
DOLLARS ($1,000,000.00) for injury to or death of one (1) person in
any one (1) accident or occurrence and not less than ONE MILLION
DOLLARS ($1,000,000.00) for property damage. The limits of
insurance coverage shall not be deemed to limit the liability of
Tenant under this Lease. Each such policy shall name Landlord as an
additional insured.
(b)
PROPERTY INSURANCE:
Landlord shall obtain and keep in force during the term of this
Lease a policy or polices of insurance, with reasonable deductibles
thereon, covering loss or
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damage to
the Property from all perils included within the classification of
fire, extended coverage, vandalism, malicious mischief and special
extended perils ("all risk"). This insurance however shall not
extend to any fixtures, equipment or personal property of Tenant
located on the Property or within the Leased Premises.
(c)
INSURANCE POLICIES:
Tenant shall deliver to Landlord certificates evidencing the
existence and limits of the insurance required under Paragraph
11(a). The policies shall provide that they may not be canceled or
modified or have coverage reduced without ten (10) days prior
written notice to the Landlord. Tenant shall not do or permit
anything to be done which would invalidate the insurance policies
and shall reimburse Landlo