Nevada Commercial Lease Agreement Template
Last Updated:
A Nevada Commercial Lease Agreement is fundamentally a reciprocal contract between you, the tenant, and your landlord. This accord grants you the license to utilize a property for your entrepreneurial activities, for a predetermined duration and a set fee. It's designed to cater to the particular operations that your business plans to execute on the premises. Endeavor to comprehend each aspect of it prior to signing.
What are the related laws for Commercial Lease Agreements in Nevada?
Chapter 118A, Title 10 of the Nevada Revised Statutes particularly tackles leases. This involves manifold processes, terminologies, and provisions dictating the inception, amendment, execution, and violation of lease contracts.
As elaborated in certain segments of the chapter:
- Section 118A.200 explicates definitions, recording a variety of terms connected to lease agreements and their respective definitions.
- Section 118A.220 caters to cases of damage or destruction, illustrating when and under what conditions the depreciation of goods transpires.
- Section 118A.390 establishes the statute of limitations for resolving lease contract disputes. It indicates that the parties can reduce the limitations period to a bare minimum of one year.
Thank you for downloading!
How would you rate your free form?
Read on to learn more about Nevada Commercial Lease Agreement, including:
How to write a Commercial Lease Agreement
To you, the entrepreneur, legal verbiage can seem a bit overwhelming, can't it? However, armed with a clear plan and the right advice, you can confidently compose your lease agreement. Let's dive into the fundamentals of a commercial lease agreement and learn how to customize it to suit you perfectly - think of this as your down-to-earth and simple guide through the landscape of commercial leases.
1. Permitted Uses
The "Allowed Uses" provision directs you on the correct utilization of the leased premises. It distinctly identifies permissible operations. These encompass industrial operations, administrative duties, warehousing, logistics, and production and distribution of goods.
Painstakingly enumerating every anticipated business operation here is crucial. This lucidity prevents potential legal complications and assures optimal resource employment. Include extensive details to preclude unexpected occurrences. Informed foreseeing aids in maintaining the operational flow of your business.
Industrial and light manufacturing, warehousing, office, distribution, and assembly, including designing, manufacturing and distributing branded merchandise and promotional products, including all activities incident or ancillary thereto and all other lawful uses and purposes.
2. Term and Option to Extend
(a) This pertains to the lease duration and possible extensions. It commences on the Start Date and concludes on the Termination Date. It can be extended for further two-year spans under identical terms, but be aware that rent may rise. To extend, deliver written notice to your landlord 30 days prior to the term end.
(b) "Timeframe" includes both the initial lease period and any subsequent extensions.
Explicit lease timeframes are key for proficient business planning and functioning, and also for potential prolongations.
(a) The initial term of this Lease will commence on the Effective Date and expire on the Expiration Date. The Tenant may extend the Term of this Lease for [two] additional [two]-year extension term(s), on all the same terms and conditions (except for Rent, which will increase during extension Terms as provided below) contained in this Lease, by notifying the Landlord in writing of the Tenant’s election to do so not less than 30 days before the expiration date of the then-current Term, as the case may be.
(b) The initial term and any applicable extension term are referred to in this Lease as the “Term.”
3. Repairs and Maintenance
The "Upkeep and Restoration" stipulation outlines the party responsible for repairs. It contemplates both interior and exterior problems, such as malfunctioning pipework or impaired masonry. The financial obligation typically rests on the landlord, sparing you the cost.
If a repair isn't remedied promptly, you have the power to arrange for repair service and deduct the expense from your rent. Consistently record these situations for potential future reference. This provision is essential as it delineates repair obligations and shields you from unforeseen outlays.
From and after the Effective Date, and for the remainder of the Term, the Landlord shall perform ordinary maintenance and repair of the interior of the improvements on the Premises. In addition, the Landlord shall, at its own cost and expense without reimbursement by the Tenant, keep and maintain in good condition and repair, and make all necessary repairs and replacements to, the exterior walls, building slabs, foundations, structural parts and components, parking lots, gutters, downspouts, roof, roof membrane and coverings and any other part, component or system on the exterior of the Premises. The Landlord shall, at its own cost and expense without reimbursement by the Tenant, keep and maintain in good condition and repair, and make all necessary repairs and replacements to the sprinkler system, mechanical, HVAC, electrical and plumbing systems of the Premises. If the Landlord fails to perform any repair or replacement required to be made by the Landlord in this Lease, and the Landlord fails to cure such failure within 15 days after receipt of a written demand from the Tenant (or immediately, in the case of emergency repairs, including loss of heating and air conditioning), then the Tenant may make such repair or replacement and the Landlord shall reimburse the Tenant for the cost thereof. If the Landlord fails to pay such amount, then the Tenant may offset against the Rent due hereunder the amount so expended.
4. Alterations
"Modifications" articulates your freedoms to alter the rented property. You can institute changes without needing the landlord's approval, however, notable modifications become the possession of the landlord. You're at liberty to evacuate personal belongings such as shelving units or equipment as long as it doesn't inflict harm on the property. Grasping this provision can avert disagreements and facilitate effective layout of your business operations.
The Tenant may, at its own cost and expense and in a good workmanlike manner, make such alterations, additions, or improvements or erect, remove, or alter such partitions, or erect such racks, shelves, bins, machinery, furniture, fixtures, trade fixtures, equipment, and other personal property as it may deem advisable, without the consent of the Landlord. All fixtures and permanent alterations, additions, improvements, and partitions erected by the Tenant will be and remain the property of the Landlord during the Term, and will be abandoned by the Tenant at the expiration of this Lease. All racks, shelves, bins, machinery, furniture, equipment, and other personal property located in the Premises as of the Effective Date or otherwise installed by the Tenant may be removed by the Tenant at any time if the Tenant so elects. All such removals and restoration shall be accomplished so as not to damage the primary structure or structural qualities of the buildings and other improvements situated on the Premises.
5. Insurance
The "Coverage" provision shelters both occupant and property owner. In your capacity as a tenant, you require both property and liability protection, designating the landlord as an additional beneficiary. The landlord is responsible for insuring against damages to the premises.
'Waivers of rights to recover' obstruct insurers from seeking restitution from the other involved party post a loss. Your coverage provider should inform the landlord 30 days prior to policy cancellation. Comprehension of these conditions ensures your enterprise's financial security.
(a) At all times during the Term, the Tenant shall maintain, at its sole cost and expense, policies of insurance containing the following insurance coverages (which policies shall name the Landlord as an additional insured):
(1) Property insurance with premiums paid in advance insuring the Tenant’s property using the standard Special Causes of Loss Form or equivalent for the full replacement value. The foregoing is referred to in this Lease as “Property Insurance.”
4
(2) Commercial general liability insurance with respect to the Premises in amounts not less than $1,000,000 per occurrence, $2,000,000 aggregate limit using current ISO forms or equivalent.
(b) The Landlord shall obtain and keep in force during the Term of this Lease a policy or policies of insurance covering loss or damage to the Premises, in the amount of the full replacement value thereof, as the same may exist from time to time, but in no event less than the total amount required by lenders having liens on the Premises, against all perils included within the classification of fire, extended coverage, vandalism, malicious mischief, flood (in the event same is required by a lender having a lien on the Property), and special extended perils ("all risk" as such term is used in the insurance industry). Such insurance must provide for a payment of loss thereunder to the Landlord or to the holder of mortgages or deeds of trust on the Premises.
(c) The policies required by this section must provide for standard waivers of any right of subrogation that the insurer of such party may acquire against the other party to this Lease, for losses that are actually insured against, even if the loss results from a negligent act or omission. The Tenant’s insurance company must provide the Landlord with a certificate of insurance on form ACORD-27 (for Property Insurance required to be carried under this Lease), or its equivalent, and ACORD-25 (for liability insurance required to be carried under this Lease), or its equivalent, which provides that the insurance may not be cancelled without giving the named insured at least 30 days’ prior written notice (or at least ten days’ written notice of cancellation in the event of the non-payment of premium). The Tenant may carry any required insurance under a blanket policy if that policy complies with the requirements of this Lease.
6. Events of Default
The "Default Incidents" provision itemizes behaviors that may result in lease breaches. Typical scenarios encompass neglecting rent remittances, encountering bankruptcy, or contravening lease stipulations. Familiarize yourself with this segment and circumvent these pitfalls to maintain a favorable rapport with your landlord and assure your business operates smoothly.
The following events will be deemed to be Events of Default by the Tenant under this Lease:
(1) The Tenant fails to pay any installment of the Rent hereby reserved when due, or any other payment or reimbursement to the Landlord required under this Lease when due, and such failure continues for a period of 30 days after the Tenant’s receipt of written notice of such nonpayment;
(2) The Tenant becomes insolvent, or makes a transfer in fraud of creditors, or makes an assignment for the benefit of creditors;
(3) The Tenant files a bankruptcy petition or Tenant is adjudged bankrupt or insolvent in proceedings filed against the Tenant;
(4) A receiver or trustee is appointed for all or substantially all of the assets of the Tenant; and
(5) The Tenant fails to comply with any term, provision, or covenant of this Lease (other than the foregoing in this section 18), and does not cure such failure within 30 days after written notice thereof to the Tenant, or such longer period as may be necessary to cure such default provided the Tenant has promptly commenced curing such default and is diligently proceeding to obtain such cure.
7. Holdover
The "Holdover" provision addresses instances when you exceed the agreed-upon lease. Should you fail to vacate by the lease's termination, expect a payment of 125% of the standard rent for each month you hold over. Be familiar with the cost implications of overstaying, and devise your exit approach accordingly.
If the Tenant holds over after the expiration of the Term and does not surrender the Premises prior to the expiration of the Term, then for each such month that the Tenant is holding over, the Tenant shall pay to Landlord 125% of the Rent due under this Lease for each month.
What happens when a Commercial Lease Agreement expires?
As a commercial lease concludes, various outcomes could potentially occur. Here are some resources that summarize these potential scenarios:
- Extension or Dissolution: It's considered best practice for commercial tenants to make the call on either renewing or dissolving their lease agreement significantly ahead of its expiration. Commencing this decision-making process 6 to 12 months beforehand is typically advised.
- Transition to Unfixed Term: In the event the original lease is not extended, or a new lease is not established, the tenant may be privileged to shift into a tenancy with an unfixed term, assuming the landlord consents.
- Occupation by Landlord: There are instances when, upon expiration of a commercial lease, the landlord decides to take up tenancy themselves, for either residential or commercial utilization.
- Possibility of Legal Pursuit: If complications surface near the conclusion of a lease, such as a tenant who has persistently deferred rent payments or neglected to comply with lease stipulations, the term end could result in legal proceedings.
What are the penalties for breaking Commercial Lease Agreements?
Absolutely, implications of prematurely terminating a commercial lease agreement can fluctuate, but there are a few typical consequences:
- Outstanding Rent: A common repercussion of exiting a commercial lease early is that the tenant remains accountable for the outstanding rent due up to the lease term's end, even after departing the premises.
- Advance Notice: The majority of commercial property owners demand a notice period varying from 30 to 90 days when the tenant opts to rescind the lease.
- Termination Charges and Extra Expenses: Based on the stipulations of the lease agreement, commercial contracts may impose termination charges and assign the tenant responsibility for any promotional costs incurred in sourcing a new tenant and potential sanitation expenses.
- Legal Implications: In the light of the specific conditions and the nature of the violation, if internal resolution procedures are exhausted within the lease, the situation may escalate to legal intervention or conclude in a court dispute.
As the specifics of these penalties can differ depending on the lease agreement, it is vital to thoroughly review the lease contract to comprehend the precise terms and conditions involved in early termination.