EXHIBIT-99
OFFICE LEASE
THIS OFFICE LEASE ("Lease"), is entered
into on November 1, 2005, between Noto
Properties II, LLC, a Michigan limited
liability company with offices located at
6600 - 28th Street, S.E., Grand Rapids,
Michigan, 49546 ("Landlord") and BestNet
Communications Corporation, a Nevada
corporation, with offices located at 5075
Cascade Road SE, Suite A, Grand Rapids,
Michigan, 49546 ("Tenant").
WITNESSETH
1. Description
of the Premises. Landlord leases to Tenant and Tenant hires
from Landlord Suite C (the "Leased
Premises") in the building (the "Building")
located at 2850 Thornhills Avenue SE, Grand
Rapids, Michigan, 49546, together
with the non-exclusive right to use the
Common Areas hereinafter defined.
2. Common Areas.
Landlord shall also make available areas and facilities of
common benefit to the tenants and occupants
of the Building which shall include,
without limitation, such parking areas,
driveways, roadways, sidewalks and
ramps, service areas, hallways and lighting
facilities as are a part of the
Building and surrounding areas (the "Common
Areas"). Subject to Section 5
hereof, Landlord shall manage, equip,
light, insure, repair and maintain the
Common Areas. All Common Areas shall be
subject to the exclusive control and
management of Landlord and Landlord shall
have the right, from time to time, to
establish, modify, and enforce rules and
regulations with respect thereto.
3. Term;
Acceptance; Renewal & Holdover.
3.1
Initial Term: This Lease shall be for an Initial Term of
Twenty-four
(24) months commencing at noon on November
1, 2005 ("the Commencement Date") and
terminating at noon on November 1, 2007
(the "Expiration Date").
3.2
Acceptance: By conducting business from the Leased Premises,
Tenant
shall be deemed to have accepted the Leased
Premises in their then present
condition and to have acknowledged that
Landlord has fulfilled its obligation to
make all improvements to the Leased
Premises in accordance with any agreement,
whether oral or written, between the
parties.
3.3
Commencement and Termination Dates: Landlord and the Tenant
shall,
upon the request of either of them, execute
an Agreement in recordable form
expressing the Commencement and Termination
Dates of the Term of this Lease.
3.4
Renewal Term: Provided Tenant is not in default of any covenant
contained in this Lease, Tenant shall have
one (1) right of renewal, which may
be exercised by Tenant, in Tenant's sole
discretion, for a further term of two
(2) years (a "Renewal Term"), provided,
however, that Tenant gives Landlord
written notice that Tenant intends to
exercise its right of renewal not later
than 60 days prior to the end of the
then-current lease or renewal term (the
"Renewal Notice"). Each renewal shall be on
the terms contained in this Lease,
except that there shall be no further
rights to renew and except as to Base Rent
which shall be adjusted as set forth in
Section 4.2.
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3.5
Holdover: In the event Tenant remains in possession of the
Leased
Premises after the expiration or
termination of the Lease, without the execution
of a lease renewal or new Lease, Tenant
shall be deemed to be occupying the
Leased Premises as a tenant from
month-to-month subject to all conditions,
provisions, and obligations of this Lease,
insofar as the same can be applicable
to a month-to-month tenancy, cancelable by
either party upon thirty (30) days
written notice to the other, except that
the rent shall increase by ten percent
(10%) over the rent for the last month of
the Lease, and Landlord may increase
the rent on 30 days' written notice to
Tenant.
4. Base
Rental.
4.1
Tenant shall pay to Landlord annual rent during the Initial Term
of
this Lease in the amount of Thirty-Five
Thousand One Hundred and Sixty Dollars
and 00/100 Dollars ($35,160) ("Base Rent"),
which shall be paid in equal
consecutive monthly installments of One
Thousand Four Hundred and Sixty-Five
Dollars and 00/100 Dollars ($1,465.00) and
a prorated portion for any partial
calendar month. Installments of rent shall
be paid on the first day of each
calendar month in advance.
4.2
In the event that Tenant exercises its right to a Renewal Term,
the
Base Rent payable during the Renewal Term
(and the Base Building Expense
figure), as specified in Section 4.1 for
Base Rent and Section 5.1 for Base
Building Expense, shall be adjusted as of
the first day of each Renewal Term
(the "First Adjustment Date") by the
percentage increase in the Consumer's Price
Index for all Urban Consumers specified for
All Items, All Cities
(1982-1984=100) and issued by the Bureau of
Labor Statistics of the United
States Department of Labor, or any
replacement thereof (the "Index"). The
increased annual Base Rent shall be equal
to the annual Base Rent payable for
the year preceding the Adjustment Date
multiplied by a fraction, the numerator
of which is the Index for the second
calendar month immediately preceding the
Adjustment Date and the denominator is the
Index for the second calendar month
one year preceding. In no event shall the
Base Rent be decreased.
Notwithstanding the foregoing, the increase
in Base Rent for any one Renewal
Term shall not be greater than five percent
(5%).
4.3
All rent shall be paid to Landlord at the address set forth herein
or
at such other address as Landlord may
designate in writing, without any prior
demand therefore and without any deduction
or offset whatsoever.
4.4
In the event that Tenant shall fail to pay any amount under
this
Lease when the same shall be due, such
amount shall be subject to a one-time
late charge of five cents (.05(cent)) for
each One Dollar ($1.00) not paid when
due and thereafter shall be subject to a
service charge until such amount is
paid at the lesser of the rate of two
percent (2%) per month or the highest rate
permitted by law.
5. Building
Expenses.
5.1
Tenant also shall pay to Landlord as additional rent its
proportionate share of Building Expenses
for each calendar year (and a
proportionate amount for any partial
calendar year) during the term of this
Lease (initial and renewal), whenever such
Building Expenses exceed Four
Thousand, Nine Hundred Eighty Seven and
50/100 Dollars ($4,987.50) for the
Leased Premises. Tenant's pro rata share of
all Building Expenses is Ten and
28/100ths percent (10.28%).
5.2
"Building Expenses" shall mean all costs and expenses incurred
by
Landlord, directly or indirectly, in the
maintenance, ownership, operation,
repair, and replacement of land and the
Building including the Common Areas, and
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including, without limitation: property
taxes and assessments, real, personal,
general and special; insurance; water,
sewer, electricity, gas and other sources
of power for heating, lighting, ventilating
or air conditioning (except when
separately billed to a specific tenant of
the Building); management fees, wages,
salaries, fringe benefits, and applicable
taxes on the employer for services
related to the Building performed by
Landlord's employees; supplies consumed in
connection with cleaning and general
maintenance; cost incurred in connection
with snow removal and exterior grounds
care; and depreciation for repairs.
Building Expenses shall not include
janitorial expenses for the Leased Premises
or other leased premises within the
Building.
5.3
Tenant, in addition to the payment of Tenant's pro rata share
of
Building Expenses, shall be directly
responsible for paying for any telephone
and janitorial services servicing the
Leased Premises. Tenant hereby releases
Landlord from any liability whatsoever for
any interruption of electrical
service or gas to the Leased Premises,
specifically including, but not limited
to, any interruption of electrical current
to word processing or computer
equipment or the memories thereof.
5.4
At the end of each calendar year, Landlord shall furnish Tenant
with
a written statement itemizing Building
Expenses and any other additional rent
for that calendar year. Tenant shall pay
the amount stated therein within ten
(10) days of receipt of the written
statement.
5.5
The additional rent provided to be paid pursuant to this Section
5
may be escalated by Landlord for each
renewal term.
6. Use. Tenant
shall use and occupy the Leased Premises for general office
purposes, and for no other purpose without
the prior written consent of the
Landlord. Tenant shall not intentionally
and knowingly use the Leased Premises
for any purpose or in any manner in
violation of any law, ordinance, rule or
regulation adopted or imposed by any
federal, state, county, or municipal body
or other governmental agency. The Tenant
shall not deface or injure the Leased
Premises or the Building, or permit any
activity in the Leased Premises which
will result in an increase of any premium
for insurance on the Leased Premises
or the Building unless Tenant shall pay
such increased premiums.
Tenant may move
its property into the Leased Premises on or after October
10, 2005. Tenant shall be liable for any
costs or damages that may result
therefrom. All property of Tenant kept on
the premises shall be so kept at the
sole risk of Tenant and Tenant shall hold
Landlord harmless from any claims
arising out of damage to same.
7. Taxes.
Subject to Tenant's obligations set forth in Section 5 hereof,
Landlord shall pay all taxes and special
assessments levied against the land and
improvements on and in which the Leased
Premises are situated. Tenant shall pay
all personal property taxes assessed
against any personal property owned by
Tenant located on or in the Leased
Premises.
8. Maintenance
and Repair. Subject to Tenant's obligations set forth in
Section 5, Landlord shall maintain and
repair the Common Areas and the Building
in good condition and repair, including the
heating and air conditioning
equipment, and the electrical and plumbing
systems. Tenant shall maintain the
Leased Premises in a neat and clean
condition. Tenant also shall be responsible
for all repairs or replacements to the
Leased Premises, the Building, and the
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Common Areas occasioned by the negligence
or willful act of Tenant, its agents,
employees, invitees, or licensees, or
resulting from Tenant's failure to report
the need for repair or maintenance in a
reasonably timely manner.
9. Assignment
and Subletting. Tenant shall not sell, assign, mortgage,
pledge, or in any manner transfer this
Lease nor sublet the Leased Premises or
any portion thereof without the prior
written consent of the Landlord.
Notwithstanding any subletting for which
consent is given by Landlord, Tenant
shall remain fully liable on this Lease.
Landlord's right to assign this Lease
is and shall remain unqualified. Upon any
sale of the Leased Premises in which
the purchaser assumes all obligations under
this Lease, Landlord shall thereupon
be entirely free of all obligations of the
Landlord hereunder and shall not be
subject to any liability resulting from any
act or omission or event occurring
after such conveyance. Tenant agrees to
recognize and attorn to any such
transferee and Tenant further agrees, at
Landlord's request, to execute and
deliver a recordable instrument setting
forth the provisions of this paragraph.
10. Utilities.
Subject to Tenant's obligations set forth in Section 5,
Landlord shall provide electricity, heat,
air conditioning, and ventilation to
the Leased Premises. Landlord shall not be
liable in damages should the
furnishing of any utilities be
interrupted.
11. Insurance;
Risk of Loss.
11.1 Subject to Tenant's obligations set forth in Section 5,
Landlord
shall insure the Building, including the
Leased Premises (but not Tenant's
leasehold improvements or personal property
located therein) and the Common
Areas, against loss or damage under a
policy of fire or extended coverage
insurance in such amounts as Landlord shall
deem appropriate. No insurance
proceed
