Exhibit 10.1

 

LEASE AGREEMENT

between

 

GIG CW COMPARK, LLC

 

(“Landlord”)

 

and

 

ZYNEX, INC.

 

(“Tenant”)

 

 

 

 

Table of Contents

 

Page

 

1. CERTAIN DEFINED TERMS 1 2. GRANT OF LEASE 2 3. RENT; SECURITY DEPOSIT 3 4.
USE 5 5. TAXES 6 6. LANDLORD’S REPAIRS AND OBLIGATIONS 7 7. TENANT’S REPAIRS AND
OBLIGATIONS 8 8. ALTERATIONS 9 9. SIGNAGE 10 10. INSPECTION AND RIGHT OF ENTRY
10 11. UTILITIES 10 12. ASSIGNMENT AND SUBLETTING 11 13. PROPERTY INSURANCE;
FIRE AND CASUALTY DAMAGE 12 14. LIABILITY AND INSURANCE 13 15. CONDEMNATION AND
EMINENT DOMAIN 14 16. END OF TERM 15 17. QUIET ENJOYMENT 16 18. EVENTS OF
DEFAULT 16 19. REMEDIES 17 20. LANDLORD’S LIEN 19 21. MORTGAGES; ATTORNMENT 19
22. MECHANICS LIENS 21 23. NOTICES 21 24. HAZARDOUS MATERIALS 22 25. INSOLVENCY
OR BANKRUPTCY 24 26. LANDLORD’S LIABILITY 24 27. MISCELLANEOUS 25 28. RENEWAL
RIGHT 27 EXHIBIT A THE LAND A-1 EXHIBIT B THE PREMISES B-1 EXHIBIT C WORK LETTER
C-1 EXHIBIT D INSURANCE REQUIREMENTS D-1

 

-i-

 

 

Table of Contents

(continued)

 

Page

 

EXHIBIT E COMMENCEMENT DATE CERTIFICATE E-1       EXHIBIT F FORM OF
SUBORDINATION, NON-DISTURBANCE AND ATTORNMENT AGREEMENT F-1

 

-ii-

 

 

LEASE AGREEMENT

 

THIS LEASE AGREEMENT (the “Lease”), made and entered into by and between GIG CW
COMPARK, LLC, a Colorado limited liability company (“Landlord”) and ZYNEX, INC.,
a Nevada corporation (“Tenant”).

 

CERTAIN DEFINED TERMS

 

“Lease Date” means that date set forth under Landlord’s signature at the end of
this Lease.

 

“Land” means the land legally described on Exhibit A attached hereto and
incorporated herein by reference in the County of Douglas, State of Colorado.

 

“Premises” means those premises consisting of approximately 50,488 rentable
square feet in the Building, as shown on Exhibit B attached hereto and
incorporated herein by reference.

 

“Building” means the building located at 14800 Grasslands Drive, Englewood,
Colorado, in which the Premises are located.

 

“Permitted Use” means general office, receiving, storing, shipping and selling
(other than retail) of products, materials, and merchandise made and/or
distributed by Tenant, light assembly, print production, and for such other
lawful purposes as may be incidental thereto, and no other purpose whatsoever.
The Permitted Use shall be subject to any declaration, easement agreement or
similar agreement, as well as any rules and regulations for the Building,
subject to the express terms hereof. Landlord hereby represents, warrants and
covenants that, as of the Lease Date, general office and industrial uses at the
Premises are not prohibited by any applicable governmental laws, ordinances and
regulations (“Laws”) or any matters of record. During the Term, Landlord shall
not consent to or enter into any amendments or new matters of record that would
materially and adversely affect Tenant’s ability to use the Premises for the
Permitted Use.

 

“Possession Date” means the date that Landlord delivers the Premises to Tenant,
which will be the first business day after the Lease Date.

 

“Commencement Date” means the first day of the Term, which will be the earlier
of (i) the date that the “Leasehold Improvements” (as defined in Exhibit C) are
substantially completed and Tenant occupies the Premises for business, and
(ii) January 15, 2021, subject to Section 0 below. The estimated Commencement
Date is December 1, 2020.

 

“Expiration Date” means (i) if the Commencement Date is the first day of a
month, the date which is 65 months from the date preceding the Commencement
Date; or (ii) if the Commencement Date is not the first day of a month, the date
which is 65 months from the last day of the month in which the Commencement Date
occurs.

 

“Term” means the duration of this Lease, which will be approximately 65 months,
beginning on the Commencement Date and ending on the Expiration Date, unless
terminated earlier or extended further as provided in this Lease. The Term shall
include any Renewal Term (as defined below) if and to the extent exercised by
Tenant.

 

 

 

 

“Base Rent” means the Rent payable according to Section 0, which will be in an
amount per month or portion thereof during the Term as follows:

 

Period Amount of Base Rent Payable Per Month Months 1-5* $39,548.93 Months
6**-17 $39,548.93 Months 18-29 $40,735.40 Months 30-41 $41,957.46 Months 42-53
$43,216.19 Months 54-65 $44,512.67

 

* Base Rent for this period will be abated beginning on the Commencement Date
and ending on the date that is five calendar months after the Commencement Date
of this Lease (the “Base Rent Abatement Period”). By way of example, if the
Commencement Date occurs on December 5, 2020, then the Base Rent Abatement
Period shall expire on May 4, 2021. However, if an “Event of Default” (as
defined in Section 0) occurs at any time during the Term, in addition to all
other remedies available to Landlord, the unamortized portion of Base Rent that
is abated pursuant to this Section 0 will automatically become immediately due
and payable.

 

** If the Commencement Date is not the first day of the month, then for purposes
of this Section 0, “Month 6” of the Term will be the first full calendar month
after the expiration of the Base Rent Abatement Period, together with the days
in the prior calendar month after the expiration of the Base Rent Abatement
Period (the “Partial Month”), and Base Rent for the Partial Month will be
payable at the same rate as set forth in this Section 0 for Month 6 prorated
based on the number of days in the Partial Month and the number of days in such
prior calendar month.

 

“Tenant’s Share” means 100%.

 

“Additional Rent” means any and all payments (other than Base Rent) required to
be made by Tenant pursuant to this Lease.

 

“Rent” means Base Rent, Additional Rent, and all other amounts required to be
paid by Tenant under this Lease.

 

“Security Deposit” means $65,045.37.

 

“Brokers” means the following brokers who will be paid by Landlord pursuant to a
separate written agreement: Stream Realty Partners and Savills.

 

GRANT OF LEASE.

 

Demise. Subject to the terms, covenants, conditions and provisions of this
Lease, Landlord leases to Tenant and Tenant leases from Landlord the Premises,
together with the nonexclusive right to use the common areas of the Land, for
the Term.

 

Delivery; Commencement Date Delays. On the Possession Date, Landlord shall
deliver the Premises to Tenant in broom-swept condition with a roof free of
leaks and all applicable mechanical, electrical, plumbing, HVAC, sprinklers,
doors, walls, ceilings, floors, lighting, docks and dock plates in good working
order as of the Possession Date. Tenant agrees to accept the Premises in its “as
is” physical condition without any further agreements, representations,
understandings or obligations on the part of Landlord to perform any
alterations, repairs or improvements (or to provide any allowance for same)
except as expressly set forth in this Lease. Notwithstanding the foregoing or
anything to the contrary in this Lease, if the Possession Date has not occurred
by the date that is five days after the Lease Date, then the outside date set
forth in subclause (ii) of Section 0 will be extended by the number of days
after such five-day period until the Possession Date actually occurs. If,
between the Lease Date and the Commencement Date (as it may be extended), there
is an event of “Force Majeure” (as defined in Section 0) that expressly
prohibits by governmental order (a) issuance of construction permits or
(b) performance of construction activities, and such prohibition actually
affects Tenant’s ability to perform its obligations under Exhibit C of the
Lease, then the outside date set forth in subclause (ii) of Section 0 will be
extended by the number of days that such governmental prohibition is in effect.

 

 2 

 

 

Landlord’s Reserved Rights. In addition to other rights in favor of Landlord set
forth herein, upon 24 hours’ advance notice (except in the event of an
emergency, in which case only reasonable notice under the circumstances shall be
required), Landlord, its agents and employees will have the right to enter the
Premises from time to time at reasonable times to examine the same, show them to
prospective purchasers and lenders, to supply any services to be provided by
Landlord to Tenant, to post notices of non-responsibility; without liability to
Tenant for any loss or damage incurred as a result of such entry, provided that
Landlord will take reasonable steps in connection with such entry to minimize
any disruption to Tenant’s business or its use of the Premises. Notwithstanding
anything contained herein to the contrary, if Tenant reasonably believes that,
due to Landlord’s exercise of its reserved rights herein, there is a material
and adverse disruption to Tenant’s ability to use the Premises for the Permitted
Use, then Landlord and Tenant will reasonably cooperate to minimize such
disruption.

 

RENT; SECURITY DEPOSIT.

 

Base Rent. Tenant agrees to pay monthly Base Rent, in advance, for the Term
hereof in the amounts as outlined in Section 0. Subject to the terms of
Section 0, each payment of “Rent” (as defined herein), including, but not
limited to, each payment of monthly Base Rent shall be due and payable before
the first day of each calendar month succeeding the Commencement Date during the
Term.

 

Additional Rent. Subject to Section 0, commencing on the Commencement Date and
then throughout the Term, Tenant agrees to pay Landlord Tenant’s Share of
“Operating Costs,” “Insurance Costs,” and “Taxes” (as such terms are defined
below) in the manner provided below:

 

Estimated Payments. Prior to the Commencement Date and within 90 days after the
beginning of each calendar year thereafter during the Term, Landlord will notify
Tenant of Landlord’s estimate of Tenant’s Share of the Operating
Costs, Insurance Costs, and Taxes for the ensuing calendar year. On or before
the first day of each month during the Term, Tenant will pay to Landlord, in
advance, 1/12th of such estimated amounts, provided that until such notice is
given with respect to the ensuing calendar year, Tenant will continue to pay on
the basis of the prior calendar year’s estimate until the month after the month
in which such notice is given. However, if the Term commences on other than the
first day of a month or ends on other than the last day of a month, Operating
Costs, Insurance Costs, and Taxes for such month will be appropriately adjusted
on a prorated basis. In the month Tenant first pays based on Landlord’s new
estimate, Tenant will pay to Landlord 1/12th of the difference between the new
estimate and the prior year’s estimate for each month which has elapsed since
the beginning of the current calendar year. If at any time or times it appears
to Landlord that Operating Costs, Insurance Costs, and/or Taxes for the
then-current calendar year will vary from Landlord’s estimate by 5% or more,
Landlord may, by 30 days’ advance notice to Tenant, revise its estimate for such
year and subsequent payments by Tenant for such year will be based upon the
revised estimate.

 

 3 

 

 

Annual Settlement. Within 120 days after the close of each calendar year during
the Term, Landlord will deliver to Tenant its annual statement of Tenant’s Share
of Operating Costs, Insurance Costs, and Taxes for such calendar year (each, a
“Statement”). If, on the basis of such statement, Tenant owes an amount that is
less than the estimated payments previously made by Tenant for such calendar
year, Landlord will either refund such excess amount to Tenant or credit such
excess amount against the next payment(s), if any, due from Tenant to Landlord
(or, if after the expiration or termination of this Lease, Landlord will provide
a reconciliation within 120 days, and the applicable refund or deficiency
payment will be payable within 30 days after such reconciliation). If on the
basis of such statement Tenant owes an amount that is more than the estimated
payments previously made by Tenant for such calendar year, Tenant will pay the
deficiency to Landlord within 30 days after the delivery of such Statement. If
this Lease commences on a day other than the first day of a calendar year or
terminates on a day other than the last day of a calendar year, Tenant’s Share
of Operating Costs, Insurance Costs, and Taxes applicable to the calendar year
in which such commencement or termination occurs will be prorated on the basis
of the number of days within such calendar year that are within the Term.
Notwithstanding anything contained herein to the contrary, any reconciliation
effected by Landlord hereunder that discloses a deficiency in payments by Tenant
shall not have a retroactive impact beyond the date that is 12 months prior to
the most recently ended calendar year (or other accounting period).

 

Tenant’s Audit Right. Within 180 days after receipt of a Statement, upon
10 days’ notice, Tenant will have the right to inspect and audit Landlord’s
books and records with respect to Operating Costs, Insurance Costs, or Taxes (an
“Audit”). In the event Tenant does not give Landlord notice of its election to
conduct an Audit within such 180-day period, the terms and amounts set forth in
the Statement will be conclusive and final, and Tenant shall have no further
right to conduct an Audit. Tenant may only use a private accounting firm or a
consulting or brokerage firm with expertise in real estate accounting and
property management for “Comparable Buildings” (as defined in Section 0 below)
retained on an hourly or fixed-fee basis or Tenant’s internal accounting staff
to conduct an Audit; in no event may Tenant use an outside firm paid on a
contingency fee basis. If the Audit reveals that the amount charged by Landlord
for Operating Costs, Insurance Costs, and/or Taxes was greater than actual
Operating Costs, Insurance Costs, and/or Taxes, Landlord will credit such
difference to Tenant against Rent next coming due (or, if after the expiration
or termination of this Lease, Landlord will refund such excess amount to Tenant
within 30 days and such obligation shall survive termination or expiration of
this Lease), and if the Audit reveals that the amount charged by Landlord for
Operating Costs, Insurance Costs, and/or Taxes was less than actual Operating
Costs, Insurance Costs, and/or Taxes, Tenant will pay such difference within
30 days after the completion of the Audit. Unless the Audit shows that the
amount charged by Landlord for Operating Costs, Insurance Costs, and Taxes was
greater than 105% of actual Operating Costs, Insurance Costs, and Taxes, Tenant
will pay Tenant’s costs associated with an Audit. If an Audit shows that the
amount charged by Landlord for Operating Costs, Insurance Costs, and Taxes was
greater than 105% of the actual Operating Costs, Insurance Costs, and Taxes,
Landlord will reimburse Tenant for the actual and reasonable out-of-pocket costs
incurred by Tenant, if any, to conduct the Audit, excluding travel and lodging
expenses. No subtenant of the Premises will be permitted to conduct an Audit.

 

Final Payment. Tenant’s obligation to pay the Additional Rent provided for in
this Section 0 which is accrued but not paid for periods prior to the expiration
or early termination of the Term will survive such expiration or early
termination. Prior to or as soon as practicable after the expiration or early
termination of the Term, Landlord may submit an invoice to Tenant stating
Landlord’s estimate of the amount by which Operating Costs, Insurance Costs,
and/or Taxes through the date of such expiration or early termination will
exceed Tenant’s estimated payments of Additional Rent for the calendar year in
which such expiration or termination has occurred or will occur. Tenant will pay
the amount of any such excess to Landlord within 30 days after the date of
Landlord’s invoice. In the event that Tenant is entitled to a refund pursuant to
this Section 0, Landlord’s obligation to refund any such amounts will survive
termination or expiration of the Term.

 

 4 

 

 

Terms of Payment. All Base Rent, Additional Rent, and other Rent will be paid to
Landlord in lawful money of the United States of America, at the address set
forth in Section 0 below, without demand, deduction or set off, except as
otherwise provided in this Lease. Tenant acknowledges that Landlord may accept
payment of Base Rent and/or Additional Rent through a lock-box account at a
federally insured financial institution and that use of a lock-box account could
mean that checks will be received and processed without actual review by
Landlord. Consequently, in accordance with Section 0, acceptance of Rent or of
any check with any note or memorandum on such check shall not constitute a
waiver of any preceding breach by Tenant; nor shall such action constitute a
modification to this Lease, any such modification requiring, in accordance with
Section 0, a written instrument signed by both parties to this Lease; nor shall
such action be deemed accord and satisfaction. Landlord may accept such check or
payment without prejudice to Landlord’s right to recover the balance or pursue
any right of Landlord.

 

Security Deposit. In addition, Tenant agrees to deposit with Landlord on or
before the Lease Date the Security Deposit, which sum shall be held by Landlord,
without obligation for interest, as security for the performance of Tenant’s
covenants and obligations under this Lease, it being expressly understood and
agreed that such Security Deposit is not an advance rental deposit or a measure
of Landlord’s damages in case of an Event of Default or other breach by Tenant
hereunder. Upon the occurrence of any “Event of Default” (as defined below in
this Lease) by Tenant, Landlord may, from time to time, without prejudice to any
other remedy provided herein or provided by law, use such fund to the extent
necessary to make good any arrears of rent or other payments due Landlord
hereunder, and any other damage, injury, expense or liability caused by such
Event of Default; and Tenant shall pay to Landlord, within 10 days of demand, as
Additional Rent, the amount so applied in order to restore the Security Deposit
to its original amount. Although the Security Deposit shall be deemed the
property of Landlord, any remaining balance of the Security Deposit shall be
returned by Landlord to Tenant within 60 days of the expiration or earlier
termination of this Lease, provided that there is no Event of Default or any
default by Tenant that, with notice, the passing of time, or both, would
constitute an Event of Default, Landlord covenants and agrees to transfer the
Security Deposit to any successor-in-interest in and to the Land.

 

USE.

 

Permitted Use. The Premises shall be used only for the Permitted Use. Tenant
shall have the right to use, at no additional cost, the outside storage area
adjacent to the Building for Tenant’s normal, current business operations.
Tenant shall, at its own cost and expense, prior to commencing operations within
the Premises, obtain and maintain throughout the Term any and all permits and
licenses necessary for any such use and shall provide copies of all such
licenses and permits to Landlord within 10 days after Landlord’s reasonable
request. In the event any such governmental authority requires any construction,
interior or exterior improvements in order that Tenant be granted its permit or
license, any such improvements will be done at Tenant’s cost, subject to
Section 0 below. At all times during the Term, Tenant shall comply with all
applicable Laws to the use of the Premises, and shall promptly comply with, and,
if directly received by Tenant, shall promptly provide to Landlord copies of,
all governmental orders and directives for the correction, prevention and
abatement of nuisances in or upon, or connected with, the Premises, all at
Tenant’s sole expense. Except as expressly provided in this Lease, Tenant hereby
acknowledges that Landlord has not made any representation or warranty to Tenant
with regard to the suitability of the Premises for Tenant’s intended use, or the
compliance of Tenant’s intended use with any zoning or other land use law,
regulations, recorded restrictive covenants or other restrictions which may be
applicable to the Premises. Except as expressly provided in this Lease, it is
Tenant’s sole responsibility to verify and determine the suitability of the
Premises for Tenant’s intended use, occupancy type and applicability of zoning
or other land use law, regulation, restrictive covenants or other restrictions
prior to lease signing this Lease. Tenant shall not permit any objectionable or
unpleasant odors, smoke, dust, gas, noise or vibrations to emanate from the
Premises, nor take any other action which would constitute a nuisance. Without
Landlord’s prior written consent, in Landlord’s sole discretion, Tenant shall
not receive, store or otherwise handle any product, material or merchandise
which is explosive or highly flammable. Tenant will not permit the Premises to
be used for any purpose or in any manner (including without limitation any
method of storage) which would render the insurance thereon void, render the
insurance risk more hazardous, or cause an increase in any applicable insurance
premium.

 

 5 

 

 

Parking. Tenant and its employees, customers and licensees shall have a license,
at no additional cost or expense to Tenant, to use up to 104 non-exclusive
parking spaces in parking areas located on the Land, subject to any declaration,
easement agreement, or similar agreement, as well as such reasonable rules and
regulations as Landlord may from time to time prescribe, all of which are
subject to the express limitations elsewhere prescribed in this Lease.

 

TAXES.

 

Obligation for Payment. Landlord agrees to pay before they become delinquent all
taxes, assessments and governmental charges of any kind and nature whatsoever
lawfully levied or assessed against the tax parcel on which the Premises is
located (hereinafter collectively referred to as “Taxes” or “Tax”). Tenant shall
pay to Landlord, as Additional Rent, Tenant’s Share of Taxes in accordance with
Section 0. Notwithstanding anything contained herein to the contrary, Taxes will
not include (i) any inheritance, estate, succession, transfer, gift, franchise,
corporate, income or profit tax or capital levy imposed upon Landlord; (ii) any
ad valorem real property taxes and assessments levied upon or with respect to
any separately assessed premises; (iii) any estate or death tax imposed on
Landlord or with respect to the Premises as a result of the death of Landlord or
its partners; (iv) intentionally deleted; (v) any taxes or special assessments
attributable to any undeveloped portion to the Land (or any land adjacent to the
Land); (vi) intentionally deleted; or (vii) the amount by which any tax or
assessment exceeds the amount Landlord would pay if the Building were Landlord’s
sole asset and the rents therefrom its sole income. In addition and
notwithstanding anything contained herein to the contrary, Taxes will not
include fees or other charges levied upon or with respect to the rents and
additional charges payable by tenants of the Land and imposed by any city,
county, special district or other taxing authority having jurisdiction (“Rent
Taxes”) unless such Rent Taxes are assessed, levied or imposed in replacement
of, or in lieu of, real property taxes otherwise payable hereunder, in which
event Taxes shall include Rent Taxes for all purposes under this Lease.

 

Other Taxes. If at any time during the Term of this Lease, the present method of
taxation shall be changed so that, in lieu of the whole or any part of any
taxes, assessments or governmental charges levied, assessed or imposed on real
estate and the improvements thereon, there shall be levied, assessed or imposed
on Landlord a capital levy or other tax directly on the rents received therefrom
and/or a franchise tax, assessment, levy or charge measured by or based, in
whole or in part, upon such rents for the present Building or any future
building or buildings on the Land, then all such taxes, assessments, levies or
charges, or the part thereof so measured or based, shall be deemed to be
included within the term “Taxes” for the purposes hereof.

 

Tax Protests. Landlord shall have the right, in its sole discretion, to employ a
tax consulting firm to attempt to assure a fair tax burden on the tax parcel on
which the Building is located within the applicable taxing jurisdiction.
Landlord shall use reasonable efforts to obtain such service on a contingency
fee basis where the cost of such service is less than or equal to the amount of
tax savings realized. Tenant shall pay to Landlord upon demand from time to
time, as Additional Rent, Tenant’s Share of the cost of such service, together
with interest thereon at the Default Rate from the date that is 30 days after
such demand, until fully paid.

 

 6 

 

 

LANDLORD’S REPAIRS AND OBLIGATIONS.

 

Landlord’s Repairs and Obligations; Notice of Defect. Landlord shall
(i) maintain only the roof, roof membrane, foundation, and the structural
soundness of the exterior walls of the Building in good repair, in compliance
with Laws and in a manner commensurate with the standards of Comparable
Buildings, reasonable wear and tear excepted, subject to the terms of this
Section 0; (ii) operate and maintain the exterior of the Building, including
exterior doors and windows, in good repair, in compliance with Laws and in a
manner commensurate with the standards of Comparable Buildings; (iii) regularly
perform the mowing of any grass, trimming, weed removal, general landscape
maintenance, common sewage line plumbing, common exterior lighting, common
dumpster removal (if applicable) and other exterior maintenance obligations of
the Building, including, but not limited to, painting, the maintenance, repair
and replacement of the downspouts, gutters, parking areas, driveways, and alleys
in a clean and sanitary condition, and otherwise in good repair, in compliance
with Laws and in a manner commensurate with the standards of Comparable
Buildings; and (iv) service, maintain and replace all heating and air
conditioning equipment within and/or serving the Premises (the “HVAC Systems”)
(collectively, “Landlord’s Maintenance”). If Tenant fails to comply with the
terms of Section 0 below following applicable notice and cure or requests
Landlord to perform the same, then Landlord may perform such obligations and
Tenant will pay as Rent to Landlord the cost of such performance, including an
amount sufficient to reimburse Landlord for overhead and supervision, within 30
days after the date of Landlord’s invoice. Notwithstanding anything contained
herein to the contrary, Tenant shall repair and pay for any damage caused by any
act or omission of Tenant, or Tenant’s employees, agents, invitees or licensees
or caused by Tenant’s breach of the provisions of this Lease, all subject to
Section 0. Tenant shall immediately give Landlord written notice of defect or
need for repairs, after which, to the extent Landlord is obligated hereunder to
remedy such defect or make such repair, Landlord shall have reasonable
opportunity to repair same or cure such defect, which repair or cure shall occur
within 30 days. “Comparable Buildings” means commercial buildings located in the
immediate vicinity of the Building that are the same or substantially the same
class, type, age and quality. “Institutional Owner Practices” means sound
accounting and property management principles consistently applied which are
consistent with the practices of the majority of the owners of similarly
situated buildings located in Englewood, Colorado, that are Comparable
Buildings. Landlord’s liability with respect to any defects, repairs or
maintenance for which Landlord is responsible under any of the provisions of
this Lease shall be limited to the cost of such repairs or maintenance or the
curing of such defect.

 

Tenant’s Payment. Tenant shall pay Landlord, as Additional Rent, Tenant’s Share
of the expenses, costs, charges, fees and amounts of every kind and nature
(other than Insurance Costs and Taxes) relating to the ownership, management,
repair, maintenance, replacement, and operation of the Premises, the Building,
and the Land, including, without limitation, Landlord’s Maintenance, reasonable
overhead, management and other related fees not to exceed 5% of gross revenues
of the Building (the “Management Fee”) (collectively, “Operating Costs”) in
accordance with Section 0. Notwithstanding to foregoing or anything contained in
this Lease to the contrary, Tenant shall not be required to make or pay for
(i) replacements of the roof, roof membrane, foundation, or the exterior walls
of the Building; (ii) repairs, modifications, or replacements required due to
the gross negligence or intentional misconduct of Landlord or Landlord’s
employees, agents, invitees, or licensees; (iii) except for “Permitted Capital
Improvements” (as defined below), capital improvements, depreciation, other
“non-cash” expense items or amortization of capital improvements; (iv) costs for
reserves; (v) costs incurred by Landlord in connection with the original design
and construction of the Building or in connection with correcting any defects in
the initial construction of the Building, the common areas and/or the Land, and
costs that were actually paid by Landlord’s warranty; (vi) the costs of contract
services provided by Landlord or its subsidiaries or affiliates, together with
overhead or profits paid to subsidiaries or affiliates of Landlord, or to any
party as a result of a non-competitive selection process, for management or
other services to the Building and/or Land, or for supplies or other materials,
to the extent that the costs of such services, supplies, or materials exceed the
costs that would have been paid had the services, supplies or materials been
provided by parties unaffiliated with the Landlord on a competitive basis and
are consistent with those incurred by Comparable Buildings; (vii) except for the
Management Fee, wages, salaries and other compensation paid to any executive
employee of Landlord and/or Landlord’s property manager (“Property Manager”)
(and/or executive employee of any agents of Landlord engaged in management of
the Building or Land) above the grade of Building manager; (viii) any cost or
expense related to removal, cleaning, abatement or remediation of “Hazardous
Materials” (as defined in Section 0), provided that Tenant will be responsible
for Hazardous Materials as set forth in Section 0; (ix) any fines, costs,
penalties or interest resulting from Landlord’s failure to make payments in a
timely manner or to comply with Laws; (x) depreciation, interest and principal
payments on mortgages and other debt, if any, and amounts paid as ground rental
or other rental for the Building by Landlord; or (xi) legal fees, except to the
extent such legal fees are incurred for the purposes of reducing Operating Costs
or Taxes. Operating Costs may include the costs of capital repairs and
replacements to the Building and the common areas (collectively, the “Permitted
Capital Improvements”): (A) that are intended to reduce (or avoid increases in)
Operating Costs, (B) that are required under applicable Laws or by a
governmental authority subsequent to the Possession Date, or (C) that replace
the HVAC Systems. Expenditures for Permitted Capital Improvements shall be
amortized on a straight-line basis, together with interest thereon, over the
useful life of such Permitted Capital Improvements (as determined by Landlord’s
accountants in accordance with GAAP) and Tenant shall only be responsible for
payment as Operating Costs of such Permitted Capital Improvements which are
amortized during the Term.

 

 7 

 

 

Self-Help. If Landlord shall fail to perform any of Landlord’s Maintenance
obligations that materially and adversely affects Tenant’s ability to use a
“Substantial Portion” (as defined below) of the Premises for the Permitted Use
within 30 days after notice from Tenant, Tenant may give Landlord another
written notice specifying such failure and containing the following phrase on
the first page of such notice in all capital letters and bold face 12-point type
(or such notice will not be deemed validly given): “LANDLORD’S FAILURE TO
COMMENCE LANDLORD’S MAINTENANCE OBLIGATIONS DESCRIBED IN THIS NOTICE WITHIN TEN
(10) DAYS WILL ENTITLE TENANT TO PERFORM SUCH OBLIGATIONS AT LANDLORD’S EXPENSE
WITHOUT FURTHER NOTICE.” If Landlord does not so perform such obligations in
10 days after receipt of such notice, then Tenant shall have the right to
perform such obligation at the sole cost of Landlord, so long as Tenant uses a
qualified, licensed and bondable contractor. Landlord shall repay to Tenant the
amount expended therefor, within 10 days after receiving Tenant’s paid receipt
for such repair. In the event Landlord fails to repay such amount to Tenant as
provided above, then, as Tenant’s sole remedy, Tenant shall have the right to
offset any such amounts owed to Tenant by Landlord, plus accrued interest
thereon at the Default Rate, against Base Rent and Additional Rent payments due
Landlord until such time as the full amount of money expended by Tenant has been
recouped. “Substantial Portion” shall mean (1) any portion of the Premises
consisting of 5,000 or more contiguous square feet, (2) complete lack of access
to the Premises; (3) complete lack of access to the parking areas located on the
Land. Tenant’s self-help remedy set forth herein will not apply in case of
damage to or destruction of the Premises. Tenant’s self-help right set forth
herein will not apply in case of damage or destruction of the Premises or the
direct result of the Alterations by Tenant or the negligence or willful
misconduct of Tenant.

 

TENANT’S REPAIRS AND OBLIGATIONS.

 

Tenant’s Obligations. Tenant shall, at its own cost and expense, keep and
maintain all parts of the Premises (except those for which Landlord is expressly
responsible under the terms of this Lease) in good condition, ordinary wear and
tear, Landlord’s repair obligations, casualty and condemnation excepted,
promptly making all repairs, repainting, and replacements, including but not
limited to, windows, glass and plate glass, doors, any office entries, interior
walls and finish work, floors and floor covering, all building systems other
than the HVAC Systems, electrical systems, dock levelers, truck doors, dock
bumpers, plumbing work and fixtures, termites and pest extermination inside the
Premises, and regular removal of trash and debris. Tenant shall not be obligated
to repair any damage caused by fire, tornado or other casualty covered by the
insurance to be maintained by Landlord pursuant to Section 0 below, except that
Tenant shall be obligated to repair all wind damage to glass in and about the
Premises.

 

 8 

 

 

ALTERATIONS.

 

Except as provided below, Tenant shall not make any alterations, additions or
improvements to the Premises (including, but not limited to, roof and wall
penetrations) (collectively, the “Alterations”) without the prior written
consent of Landlord, which consent shall not be unreasonably withheld,
conditioned or delayed. In the event Landlord consents to the making of any such
Alterations, the same shall be made by Tenant, at Tenant’s sole cost and
expense, in accordance with all applicable Laws, and all requirements of
Landlord’s and Tenant’s insurance policies and only in accordance with plans and
specifications approved by Landlord (if applicable hereunder); and any
contractor or person selected by Tenant to make the same and all subcontractors
must be licensed and reputable in the vicinity of the Land. In no event shall
Tenant’s Alterations affect the structural, electrical or mechanical systems of
the Premises or the Building or affect the exterior of the Premises or the
Building. If Tenant fails to obtain Landlord’s consent prior to making any
Alterations, if and to the extent applicable hereunder, Landlord shall have the
right to reverse the applicable Tenant’s Alterations and restore the Premises to
its condition existing immediately prior to such Alterations. Any and all of
Landlord’s costs with respect to such improper Alterations and Landlord’s
actions to restore the Premises as a result, including management fees, shall be
charged to Tenant as Additional Rent. Tenant may, without the consent of
Landlord, but at its own cost and expense, in a good workmanlike manner and
subject to the other requirements of this Section 0 (as applicable), erect such
shelves, bins, machinery, racking systems, and trade fixtures within the
Premises as it may deem advisable, without altering the basic character of the
Building or other improvements located on the Land and without overloading or
damaging the Building or other improvements located on the Land, and in each
case complying with all applicable Laws and other requirements. All Alterations
erected by Tenant shall be and remain the property of Tenant during the Term of
this Lease and Tenant shall, unless Landlord otherwise elects as hereinafter
provided, leave all Alterations in the Premises and such Alterations shall
become the property of Landlord as of the Expiration Date or upon earlier
vacating of the Premises and shall be surrendered to Landlord with the Premises.
Notwithstanding the foregoing, if Tenant elects to make any non-industrial
Alterations to the Premises, Landlord may notify Tenant, at the time of
Landlord’s approval of such Alterations, that Tenant will be required to remove
such Alterations and restore the Premises to its prior condition by the
Expiration Date or upon earlier vacating of the Premises. Notwithstanding the
foregoing sentence, all shelves, bins, machinery and trade fixtures installed by
Tenant may be removed by Tenant prior to the termination of this Lease if Tenant
so elects, and shall be removed by the Expiration Date or upon earlier vacating
of the Premises if required by Landlord. Upon any such removal Tenant shall
restore the Premises and the Building (if applicable) to their condition as of
the Commencement Date, ordinary wear and tear, Landlord’s repair obligations,
casualty and condemnation, and surrendered Alterations excepted. All such
removals and restoration shall be accomplished in a good workmanlike manner so
as not to damage the primary structure or structural qualities of the Building
and other improvements situated on the Land. The provisions of this Section 0
shall survive the expiration or earlier termination of this Lease.
Notwithstanding anything contained herein to the contrary, Tenant may perform
interior, non-structural Alterations in the Premises that do not affect the
central systems (e.g., mechanical, electrical, or plumbing systems) of the
Building, roof, or exterior walls, do not require construction permits, and do
not, in any one calendar year, exceed an aggregate cost of $150,000.00 without
Landlord’s consent, subject, however, to other applicable provisions of this
Section 0.

 

 9 

 

 

SIGNAGE.

 

Subject to the terms of this Section 0, Tenant may, at its sole cost and
expense, install signage on the exterior of the Premises (the “Signage”). The
design, location, size, appearance, and method of attachment of the Signage must
be reasonably approved in writing by Landlord prior to installation and will be
in accordance with Laws. The Signage must comply with any applicable Laws.
Tenant, at its sole cost and expense, will obtain all necessary permits with
respect to the Signage. Such installations and removals shall be made in such a
manner as to avoid damage or defacement of the Building and other improvements
on the Land. Tenant will maintain the Signage in good and operating condition.
If the Signage is damaged or inoperative, Tenant will commence repair of the
Signage as soon as practicable, but in no event later than 24 hours (exclusive
of Saturdays and Sundays) after receipt of notice from Landlord, and thereafter,
Tenant will diligently pursue completion of such repair. Upon vacation of the
Premises, or the removal or alteration of the Signage for any reason, Tenant
will be responsible for the repair, maintenance and/or replacement of the
Building fascia surface where the Signage was attached, if applicable, ordinary
wear and tear, Landlord’s repair obligations, casualty and condemnation
excepted. Landlord, at Landlord’s option and after reasonable notice and
opportunity to cure, may perform any of Tenant’s obligations to install, repair,
maintain and/or replace the Signage and the Building fascia surface where the
Signage is attached, if applicable, and Landlord will be entitled to
reimbursement from Tenant for the costs and expenses related thereto. Except as
set forth above, Tenant will not, without Landlord’s prior written consent,
(a) make any changes to or paint the exterior of the Building, (b) install any
exterior lighting, decorations, banners or temporary or portable signs, or
(c) affix signs, advertisements, banners or other materials to the inside or
outside of windows or to any doors, columns, or walls. The provisions of this
Section 0 shall survive the expiration or earlier termination of this Lease.

 

INSPECTION AND RIGHT OF ENTRY.

 

Upon 24 hours’ advance notice (except in the event of an emergency, in which
case only reasonable notice under the circumstances shall be required), Landlord
and Landlord’s agents and representatives shall have the right to enter the
Premises to inspect the Premises at any reasonable time during business hours,
for the purpose of ascertaining the condition of the Premises or in order to
make such repairs as may be required or permitted to be made by Landlord under
the terms of this Lease. Upon 24 hours’ advance notice and during the period
that is nine months prior to the end of the Term hereof, Landlord and Landlord’s
agents and representatives shall have the right to enter the Premises at any
reasonable time during business hours for the purpose of showing the Premises
and shall have the right to erect on the Premises and/or the Building a suitable
sign indicating the Premises are available.

 

UTILITIES.

 

Except to the extent the same are part of Operating Costs or part of Landlord’s
Maintenance, Tenant shall obtain and pay for all water, gas, heat, light, power,
telephone, sewer, sprinkler, and HVAC charges and other utilities and services
used on or from the Premises (collectively, “Utility Services”), together with
any taxes, penalties, surcharges or the like pertaining thereto, and any
maintenance charges for such utilities, and shall furnish all electric light
bulbs and tubes. In no event shall Landlord be liable or responsible for any
loss, damage, or expense that Tenant may sustain or incur, or be in default
hereunder as a result of, any change, failure, interference, disruption or
defect in the supply or character of the Utility Services furnished to the
Premises, or if the quantity or character of the Utility Services supplied by a
utility service provider is no longer available or suitable for Tenant’s
requirements, and no such change, failure, defect, unavailability or
unsustainability shall constitute an actual or constructive eviction, in whole
or in part, or entitle Tenant to any abatement or diminution of Rent, or relieve
Tenant from any of its obligations under the Lease. Notwithstanding anything
contained in this Lease to the contrary, if, due to reasons within Landlord’s
control, any of the Utility Services should become unavailable and should remain
unavailable for a period of four  days after notice of such unavailability from
Tenant to Landlord, and if such unavailability should render a Substantial
Portion of the Premises untenantable, and Tenant does not occupy the Premises,
then commencing upon the expiration of such four-day period, Tenant’s Rent will
abate so long as such services remain unavailable for such reasons. Without
limiting those reasons for an irregularity or stoppage of Utility Services that
may be beyond Landlord’s control, any such irregularity or stoppage that is
required in order to comply with any laws or that is required or recommended by
governmental agencies for health or safety reasons will be deemed caused by a
reason beyond Landlord’s control. Tenant’s abatement right set forth herein will
not apply in case of damage to or destruction of the Premises or the direct
result of any Alterations by Tenant or the negligence or willful misconduct of
Tenant.

 

 10 

 

 

ASSIGNMENT AND SUBLETTING.

 

General Prohibition; Transfer Notice. Except as provided herein, Tenant shall
not, without the prior written consent of Landlord, which consent will not be
unreasonably withheld, conditioned, or delayed: (i) assign, transfer, or
encumber this Lease or any estate or interest herein, whether directly or by
operation of law; (ii) if Tenant is an entity other than a corporation whose
stock is publicly traded, permit the transfer of an ownership interest in Tenant
so as to result in a change in the current control of Tenant; (iii) sublet any
portion of the Premises; (iv) grant any license, concession, or other right of
occupancy of any portion of the Premises; or (v) permit the use of the Premises
by any parties other than Tenant (any of the events listed in (i) through (v) of
this Section 0 being a “Transfer”). Notwithstanding anything contained herein to
the contrary, any assignment or sublease to an entity which controls, is
controlled by, or is under common control with Tenant, or which is the result of
a merger or consolidation with Tenant, or which acquires all or substantially
all of Tenant’s assets and has a tangible net worth equal to or greater than
that of Tenant as of the Lease Date shall not require the consent of Landlord (a
“Permitted Transfer”), provided, however, that the Permitted Use of the Premises
shall not change. Notwithstanding the foregoing, Tenant shall notify Landlord of
such assignment or sublease in writing and deliver to Landlord any documents or
information reasonably required by Landlord regarding such assignment or
sublease, and further provided that such an assignment or sublease is not an
effort by Tenant to avoid any of its obligations under this Lease, including,
without limitation, the obligations under this Section 0. For purposes of the
preceding sentence, in order for an entity to control another, the controlling
entity must have voting control of and own greater than 50% of every class of
voting stock and/or other voting equity interest of the entity, when the
controlled entity is a corporation; the controlling entity must be the owner of
greater than 50% of the partnership or limited liability company interests in
the assets, liabilities, income, loss and distributions of the controlled
entity, when the controlled entity is a partnership or limited liability
company; or the controlling entity must be the sole beneficiary of the
controlled entity, when the controlled entity is a trust.

 

Notice of Proposed Transfer. Except for a Permitted Transfer, Tenant shall, by
written notice (a “Transfer Notice”), advise Landlord of its desire from and
after a stated date (which shall not be less than 30 days nor more than 90 days
after the date of Tenant’s Transfer Notice) to sublet the Premises or any
portion thereof for any part of the term thereof. A Transfer Notice shall state
the name and address of the proposed transferee, and Tenant shall deliver to
Landlord a true and complete copy of the proposed sublease or other Transfer
documentation with said Transfer Notice. Landlord will not unreasonably withhold
its consent to the Transfer specified in said Transfer Notice. Concurrently with
Tenant’s Transfer Notice of any request for consent to an assignment or sublease
of the Premises, Tenant shall pay to Landlord a fee of $1,500 to defray
Landlord’s expenses in reviewing such request, and Tenant shall also reimburse
Landlord immediately upon request for its reasonable attorneys’ fees incurred in
connection with considering any request for consent to a Transfer.

 

Effect of Transfer. No Transfer hereunder by Tenant shall result in Tenant being
released or discharged from any liability under this Lease and any guaranty
shall be unaffected by any such sublease or assignment and shall remain in full
force and effect for all purposes. As a condition to Landlord’s prior written
consent as provided for in Section 0 above, the subtenant or subtenants shall
agree in writing to comply with and be bound by all of the terms, covenants,
conditions, provisions and agreements of this Lease, and Tenant shall deliver to
Landlord promptly after execution, an executed copy of each sublease and an
agreement of said compliance by each sublessee. The term of any such proposed
assignment or sublease shall not extend beyond the Term.

 

 11 

 

 

No Implied Consent. Landlord’s consent to any sale, assignment, encumbrance,
subletting, occupation, lien or other Transfer shall not release Tenant from any
of Tenant’s obligations hereunder or be deemed to be a consent to any subsequent
occurrence. Any sale, assignment, encumbrance, subletting, occupation, lien or
other Transfer of this Lease which does not comply with the provision of this
Section 0 shall be null and void, and, at Landlord’s option, shall be an Event
of Default under this Lease.

 

Excess Rent. Tenant shall pay to Landlord, immediately upon receipt thereof, 50%
of any Rent in excess of the Rent hereunder after deducting all costs and
expenses associated with any subletting or assignment.

 

Advertising. Tenant shall be bound by the confidentiality provisions set forth
in Section 0 below with respect to any advertisement or solicitation, in any
print, radio, electronic or other visual medium, for the subletting of the
Premises or the assignment of the Lease.

 

PROPERTY INSURANCE; FIRE AND CASUALTY DAMAGE

 

Property Insurance. Landlord agrees to maintain the insurance set forth in
Paragraph          of Exhibit D attached to this Lease and incorporated herein
by this reference. Subject to the provisions of Sections 0, 0 and 0 below, such
insurance shall be for the sole benefit of Landlord and under its sole control.
Tenant shall pay to Landlord, as Additional Rent, Tenant’s Share of the
insurance maintained by Landlord pursuant to this Section 0 (“Insurance Costs”)
in accordance with Section 0.

 

Premium Increase. If any increase in the fire and extended coverage insurance
premiums paid by Landlord is caused by Tenant’s particular use and occupancy of
the Premises (as opposed to the general use described in the Permitted Use), or
if Tenant vacates the Premises and causes an increase in such premiums, then
Tenant shall pay as Additional Rent the amount of such increase to Landlord.

 

Notice of Damage. If the Building or other improvements utilized by Tenant
situated upon the Land should be damaged or destroyed by fire, tornado or other
casualty, Tenant shall give notice thereof to Landlord.

 

Major Damage. If the Premises should be totally destroyed by fire, tornado or
other casualty, or if they should be so damaged thereby that rebuilding or
repairs cannot in Landlord’s estimation be completed within 270 days after the
date upon which Landlord is notified by Tenant of such damage or if such
casualty is not covered by the insurance required to be maintained by Landlord
hereunder, either Landlord or Tenant may terminate this Lease by providing prior
written notice to the other party, delivered 15 days after delivery of
“Landlord’s Repair Notice” (as defined below), and Rent shall be abated during
the unexpired portion of this Lease, effective upon the date of the occurrence
of such damage; provided, however, that Tenant’s right of termination may not be
exercised until it has received written notice from Landlord that the
circumstances permitting termination pursuant to this Section 0 have occurred,
which notice, Landlord shall deliver within 45 days after Landlord’s
notification of such casualty (“Landlord’s Repair Notice”).

 

 12 

 

 

Minor Damage. If the Premises and/or the Building should be damaged by any peril
covered by the insurance to be provided by Landlord under Section 0 above, but
only to such extent that rebuilding or repairs can in Landlord’s estimation be
completed within 270 days after the date upon which Landlord is notified by
Tenant of such damage (as set forth in Landlord’s Repair Notice), this Lease
shall not terminate, and Landlord shall at its sole cost and expense thereupon
proceed with reasonable diligence to rebuild and repair the Premises or the
Building at Landlord’s cost to substantially the condition in which they existed
prior to such damage, except that Landlord shall not be required to rebuild,
repair or replace any part of the partitions, fixtures, additions and other
improvements which may have been placed in, on or about the Premises by Tenant
and except that Landlord may elect not to rebuild if such damage occurs during
the last year of the Term exclusive of any option which is unexercised at the
time of such damage. Tenant shall be obligated to repair, restore and replace
any and all damaged property that is required to be insured by Tenant under this
Section 0 below. If the Premises are untenantable in whole or in part following
such damage, Rent payable hereunder during the period in which they are
untenantable shall be reduced in proportion to the percentage of square footage
of the Premises which is untenantable.

 

Mortgagee’s Rights. Notwithstanding anything herein to the contrary, in the
event the holder of any indebtedness secured by a mortgage or deed of trust
covering the Premises requires that the insurance proceeds be applied to such
indebtedness, then Landlord shall have the right to terminate this Lease by
delivering written notice of termination to Tenant within 15 days after such
requirement is made by any such holder, whereupon all rights and obligations
hereunder shall cease and terminate as of the date of such notice.

 

Release and Waiver of Subrogation. Each of Landlord and Tenant hereby waives and
releases the other from any loss or damage to property caused by fire or any
other perils to the extent of the greater amount of insurance required under
this Lease or the amount of insurance actually carried insured in policies of
insurance covering such property, even if such loss or damage shall have been
caused by the fault or negligence of the other party, or anyone for whom such
party may be responsible but not if the loss or damage is a result of the
intentional misconduct or gross negligence of the other party or anyone for whom
such party may be responsible; provided, however, that this waiver and release
shall be applicable and in force and effect only with respect to loss or damage
occurring during such times as the releasor’s policies shall contain a clause or
endorsement to the effect that any such waiver and release shall not adversely
affect or impair said policies or prejudice the right of the releasor to recover
thereunder and then only to the extent of the insurance proceeds payable under
such policies. Each of Landlord and Tenant agrees that it will require its
insurance carriers to include in its policies such a clause or endorsement.

 

LIABILITY AND INSURANCE

 

Certain Waivers. Subject to Section 0 and except to the extent of the gross
negligence or willful misconduct of Landlord or any party acting by, through or
under Landlord, Landlord shall not be liable to Tenant and Tenant hereby waives
all claims against Landlord and any of its partners for any injury or damage to
any person or property in or about the Premises by or from any cause whatsoever,
and, without limiting the generality of the foregoing, whether caused by water
leakage of any character from the roof, walls, basement, or other portion of the
Premises, the Building, or caused by gas, fire, Force Majeure, discharge of
sprinklers, excessive heat or cold, sewage, odors, noise, bursting or leakage of
pipes or plumbing fixtures, or explosion of the Building. Tenant will hold
Landlord harmless from damages due to the interruption of Tenant’s business
caused by any damage whatsoever.

 

 13 

 

 

Tenant Indemnity; Tenant’s Risk. Subject to Section 0 above and except to the
extent of the gross negligence or willful misconduct of Landlord or any party
acting by, through, or under Landlord, Tenant shall indemnify, defend, and hold
the Landlord Indemnitees harmless from and against any and all claims or
liability from any injury or damage to any person or property whatsoever:
(i) occurring in, on, or about the Premises or any part thereof, (ii) occurring
in, on, or about the common areas of the Building or the Land when such injury
or damage shall be caused in part or in whole by the gross negligence or
intentional misconduct act of Tenant, its agents, servants, employees, or any
other person entering the Premises with express or implied invitation of Tenant,
(iii) caused by Tenant’s racking system, inventory, forklifts or equipment, or
(v) arising from any breach or Event of Default on the part of Tenant pursuant
to the terms of this Lease. All property in the Building or Premises belonging
to Tenant, its agents, employees or invitees shall be there at the risk of
Tenant, unless such loss or damage is due to Landlord’s gross negligence or
willful acts in which case Landlord shall indemnify and hold Tenant harmless
from and defend Tenant against any and all claims or liability from such loss or
damage. Tenant agrees to indemnify and save harmless the Landlord Indemnitees
against claims for damage to, theft, misappropriation, or loss of said property.
Furthermore, in case any action or proceeding be brought against any Landlord
Indemnitees by reason of any claims or liability, Tenant agrees to defend such
action or proceeding at Tenant’s sole expense by counsel reasonably satisfactory
to Landlord. The provisions of this Section 0 shall survive the expiration or
earlier termination of this Lease with respect to any claims or liability
arising from anything occurring prior to such expiration or earlier termination.

 

Tenant’s Insurance. Tenant will comply with the requirements set forth in
Paragraph          of Exhibit D attached to this Lease and incorporated herein
by this reference, including, without limitation, purchasing, at Tenant’s own
expense, and keeping in force during the Term of this Lease, all of the
insurance described in such section; provided, however, that the purchase of
such insurance shall not release Tenant of any legal obligations contained
within this Lease.

 

Landlord Indemnity. Subject to Section 0 and except to the extent of the gross
negligence or willful misconduct of Tenant or any party acting by, through, or
under Tenant or as otherwise set forth in Section 0 above, Landlord shall
indemnify, defend, and hold Tenant and its agents and representatives, and any
subsidiary or affiliate of the foregoing, and their respective officers,
directors, shareholders, partners, employees, managers, contractors, attorneys
and agents from and against any and all claims or liability from any injury or
damage to any person or property whatsoever to the extent: (i) occurring in, on,
or about the common areas of the Building or the Land (except as otherwise
provided in Section 0 above), (ii) arising from any breach on the part of
Landlord pursuant to the terms of this Lease, or (iii) occurring in, on, or
about the Premises when such injury or damage shall be caused by the gross
negligence or willful misconduct of Landlord, its contractors, agents, servants,
or employees.

 

CONDEMNATION AND EMINENT DOMAIN

 

Termination. If the whole or any substantial part of the Premises should be
taken for any public or quasi-public use under governmental law, ordinance or
regulation, or by right of eminent domain, or by private purchase in lieu
thereof (as applicable, a “Taking”), and the Taking would prevent or
unreasonably and adversely interfere with the use of the Premises for the
purpose for which they are being used, then either party hereto shall have the
right to terminate this Lease upon prior written notice to the other party,
effective on the date physical possession is taken by the condemning authority
or private purchaser.

 

Partial Taking. If part of the Premises shall be the subject of a Taking, and
this Lease is not terminated as provided in Section 0 above, this Lease shall
not terminate but Rent payable hereunder during the unexpired portion of this
Lease shall be reduced in proportion to the percentage of the Premises condemned
and the reduction shall be effective on the date physical possession is taken by
the condemning authority or private purchaser.

 

 14 

 

 

Awards. All compensation awarded for any Taking (or the proceeds of private sale
in lieu thereof) of the Premises, Building, or other improvements on the Land or
any part thereof, shall be the property of Landlord, and Tenant hereby assigns
its interest in any such award to Landlord; provided, however, Tenant shall have
a right to such portion of the award for loss of tenant business, moving and
relocation expenses, or for the taking of Tenant’s fixtures and improvements.

 

Evidence of Termination. Any election to terminate this Lease following a Taking
shall be evidenced only by written notice of termination delivered to the other
party not later than 15 days after the date on which physical possession is
taken by the condemning authority or private purchaser and shall be deemed
effective as of the date of said taking.

 

END OF TERM.

 

Surrender. Upon the expiration or earlier termination of the Term, Tenant will
immediately vacate and surrender possession of the Premises in good order,
repair and condition, ordinary wear and tear, Landlord’s repair obligations,
casualty and condemnation excepted. Upon the expiration or other termination of
the Term, or termination of Tenant’s right to possession of the Premises, Tenant
agrees to remove (a) any Tenant Alterations to the extent required under
Section 0 and (b) all of Tenant’s trade fixtures, office furniture, office
equipment and other personal property. The Leasehold Improvements and any
cabling will remain at the Premises and become the property of Landlord. In the
event that Tenant fails to perform any obligations hereunder, Landlord may at
its option make such repairs or perform such obligations without any liability
to Tenant (including, but not limited to, any consequential loss or damage
suffered by Tenant as a result of such performance). Tenant shall be liable to
Landlord for the cost of such repairs. Any Security Deposit held by Landlord
shall be credited against the amount payable by Tenant under this Lease. Tenant
shall pay to Landlord, upon demand, the total amount of all such costs in excess
of any Security Deposit held by Landlord plus interest thereon at the Default
Rate, such interest to accrue continuously from the date of payment by Landlord
until repayment by Tenant. Notwithstanding anything herein to the contrary, the
provisions of this Section 0 shall expressly survive the expiration or
termination of this Lease.

 

Holdover. Tenant understands that it does not have the right to hold over at any
time. Tenant will, on or before the Expiration Date or earlier termination of
this Lease, yield up immediate possession to Landlord with all repairs and
maintenance required herein to be performed by Tenant completed. Notwithstanding
the foregoing, Tenant shall have the right to hold over for a period of 90 days
after the Expiration Date, and all of the other terms and provisions of this
Lease shall be applicable during that period, except that Tenant shall pay, in
addition to all Additional Rent, Base Rent in an amount equal to 125% of the
Base Rent in effect on the Expiration Date. After such initial 90-day holdover
period, unless the parties hereto otherwise agree in writing on the terms of
such holding over, the holdover tenancy shall be subject to termination by
Landlord at any time upon not less than five days advance written notice, or by
Tenant at any time upon not less than 30 days advance written notice, and all of
the other terms and provisions of this Lease shall be applicable during that
period, except that Tenant shall pay Landlord from time to time, upon demand, as
Base Rent for the period of any holdover, in addition to all Additional Rent for
such period which would otherwise be required to be paid by Tenant during the
Term hereof, an amount equal to 150% of the Base Rent in effect on the
Expiration Date or the date or earlier termination of the Lease. Tenant shall
pay all amounts due under this Section 0 to Landlord, upon demand, together with
interest thereon at the Default Rate from the date of such demand until fully
paid. Notwithstanding anything herein to the contrary, no holdover by Tenant,
whether with or without consent of Landlord, shall operate to extend this Lease.
The preceding provisions of this Section 0 shall not be construed as consent for
Tenant to hold over, and Landlord may exercise any and all remedies at law or in
equity to recover possession of the Premises, as well as any damages incurred by
Landlord due to Tenant’s failure to vacate and deliver possession of the
Premises to Landlord as provided herein.

 

 15 

 

 

QUIET ENJOYMENT.

 

Landlord represents and warrants that it has full right and authority to enter
into this Lease and that Tenant, while paying the Rent herein set forth and
performing its other covenants and agreements herein set forth, shall peaceably
and quietly have, hold and enjoy the Premises for the Term hereof without
hindrance or molestation from Landlord or any party acting by, through, or under
Landlord, subject to the terms and provisions of this Lease. Landlord shall not
be liable for any interference or disturbance by third parties (not including
Landlord’s contractors, agents, servants, or employees), nor shall Tenant be
released from any of the obligations of this Lease because of such interference
or disturbance.

 

EVENTS OF DEFAULT.

 

The following events shall be deemed to be “Events of Default” by Tenant under
this Lease:

 

Failure to Pay Rent. Tenant fails to pay all or any portion of Base Rent,
Additional Rent, or any other Rent payable by Tenant under the terms of this
Lease when due, and such failure continues for a period of five days after
written notice from Landlord to Tenant of such failure; provided that Tenant
will be entitled to only two notices of such failure during any calendar year
and if, after two such notices are given in any calendar year, Tenant fails,
during such calendar year, to pay any such amounts when due, such failure will
constitute an Event of Default without further notice by Landlord or additional
cure period; or

 

Abandonment. Tenant shall vacate all or a substantial portion of the Premises
without paying Rent; or

 

Generally. Tenant breaches or fails to comply with any provision of this Lease
applicable to Tenant (other than those described in this Section 0), and such
breach or noncompliance continues for a period of 30 days after written notice
by Landlord to Tenant; or if such breach or noncompliance cannot be reasonably
cured within such 30-day period, Tenant does not in good faith commence to cure
such breach or noncompliance within such 30-day period and diligently pursues
completion of the same (but in no event longer than 90 days); or

 

Execution. The leasehold interest of Tenant shall be levied upon under execution
or be attached by process of law or Tenant shall fail to contest diligently the
validity of any lien or claimed lien and give sufficient security to Landlord to
insure payment thereof or shall fail to satisfy any judgment rendered thereon
and have the same released, and such failure shall continue for 20 days after
Tenant’s knowledge of such proceeding; or

 

Insolvency. Tenant shall become bankrupt or insolvent, or file any debtor
proceedings, or voluntarily file pursuant to any statute a petition in
bankruptcy or insolvency or for reorganization, or file a petition for the
appointment of a receiver or trustee for all or substantially all of Tenant’s
assets and such petition or appointment shall not have been set aside within
60 days from the date of such petition or appointment, or in the event Tenant
makes an assignment for the benefit of creditors, or petitions for or enters
into an arrangement; or

 

Insurance. Tenant shall fail to maintain any insurance required herein.

 

 16 

 

 

REMEDIES.

 

Generally. Upon each occurrence of any Event of Default, Landlord shall have the
option to pursue any one or more of the following remedies without any notice or
demand: (i) terminate this Lease; and/or (ii) enter upon and take possession of
the Premises with or without terminating this Lease; and/or (iii) pursue, at
Landlord’s option, one or more remedies pursuant to this Lease, Tenant hereby
specifically waiving any state or federal Laws to the contrary; and in any such
event Tenant immediately shall surrender its Premises to Landlord, and if Tenant
fails to do so, Landlord, without waiving any other remedy it may have, may
enter upon and take possession of the Premises or any part thereof by force if
necessary, without being liable for prosecution or any claim of damages
therefor.

 

Late Charges and Interest. In the event Tenant fails to pay any installment of
Rent or other sum due hereunder as and when such amount is due, to help defray
the additional cost to Landlord for processing such late payments, Tenant shall
pay to Landlord, on demand, as Additional Rent, a late charge in an amount equal
to 5% of such installment, together with interest thereon at the Default Rate
from the date of such demand, until fully paid. The failure to pay such late
charge, and the applicable interest thereon, within five days after demand
therefor shall be an Event of Default. In addition, all Rent payable by Tenant
under this Lease which is not paid within five days after such amount is due
shall bear interest at the Default Rate from the first day after such amount is
due until such amount is fully paid. The provision for late charges and interest
under this Section 0 shall be in addition to all of Landlord’s other rights and
remedies hereunder or at law and shall not be construed as liquidated damages or
as limiting Landlord’s remedies in any manner. Notwithstanding anything
contained herein to the contrary, Tenant shall not be obligated to pay any late
charge or any interest hereunder until Landlord has given Tenant five days’
written notice of the delinquent payment (which may be given at any time during
the delinquency); provided, however, that such written notice shall not be
required more than two times in any 12-month period.

 

No Deemed Surrender; Landlord’s Rights. Exercise by Landlord of any one or more
remedies hereunder granted or otherwise shall not be deemed to be an acceptance
of surrender of the Premises by Tenant, whether by agreement or by operation of
law, it being understood that such surrender can be effected only by the written
agreement of Landlord and Tenant. No such alteration of locks or other security
devices and no removal or other exercise of dominion by Landlord over the
property of Tenant or others at the Premises shall be deemed unauthorized or
constitute a conversion, Tenant hereby consenting, after any Event of Default to
the aforesaid exercise of dominion over Tenant’s property within the Premises.
All claims for damages by reason of such re-entry and/or repossession and/or
alteration of locks or other security devices are hereby waived, as are all
claims for damages by reason of any distress warrant, forcible detainer
proceedings, sequestration proceedings or other legal process. Tenant agrees
that any re-entry by Landlord may be pursuant to judgment obtained in eviction
proceedings or other legal proceedings or without the necessity for any legal
proceedings, as Landlord may elect, and Landlord shall not be liable for
trespass or otherwise.

 

Ongoing Liability. In the event Landlord elects to terminate this Lease by
reason of an Event of Default, then notwithstanding such termination, Tenant
shall be liable for and shall pay to Landlord, at the address specified for
notice to Landlord herein, the sum of all Rent and other indebtedness accrued to
the date of such termination, plus, as damages, an amount equal to the present
value (determined using a discount rate equal to the discount rate of the branch
of the Federal Reserve Bank closest to the Premises in effect as of the date of
the default, plus 4%) of the total Rent which would have accrued to Landlord
under this Lease for the remainder of the Term of this Lease (or such portion of
the Term in which Landlord elects to recover this damage measure), if the terms
of this Lease had been fully complied with by Tenant, but in no event will such
damages exceed the amount permitted under applicable Laws.

 

 17 

 

 

Possession without Termination. In the event that Landlord elects to repossess
the Premises without terminating this Lease, then Tenant, at Landlord’s option,
shall be liable for and shall pay to Landlord, at the address specified for
notice to Landlord herein, all Rent and other indebtedness accrued to the date
of such repossession, plus Rent required to be paid by Tenant to Landlord during
the remainder of the Term until the Expiration Date diminished by any net
amounts of Rent thereafter received by Landlord through reletting the Premises
during said period (after deducting expenses incurred by Landlord as provided in
Section 0 below). In no event shall Tenant be entitled to any excess of any rent
obtained by letting over and above Base Rent herein reserved. Actions to collect
amounts due by Tenant to Landlord under this Section 0 may be brought from time
to time, on one or more occasions, without the necessity of Landlord’s waiting
until Expiration Date.

 

Landlord’s Costs. In case of any Event of Default, Tenant shall also be liable
for and shall pay to Landlord, at the address specified for notice to Landlord
herein, in addition to any sum provided to be paid above, any and all broker’s
fees incurred by Landlord in connection with reletting the whole or any part of
the Premises; the costs of removing and storing Tenant’s or the occupant’s
property; the costs of repairing, altering, remodeling or otherwise putting the
Premises into condition acceptable to a new tenant or tenants, and all
reasonable expenses incurred by Landlord in enforcing or defending Landlord’s
rights and/or remedies including reasonable attorney’s fees.

 

Mitigation; Consequential Damages. In the event of termination or repossession
of the Premises for an Event of Default, Landlord shall have an affirmative
obligation to mitigate Landlord’s damages to the extent required by applicable
Laws. In the event of reletting, Landlord may relet the whole or any portion of
the Premises for any period to any tenant and for any use and purpose.
Notwithstanding anything contained herein to the contrary, Landlord and Tenant
hereby waive any consequential, punitive, and special damages, compensation or
claims for inconvenience or loss of business, rents, or profits, whether or not
caused by the willful and wrongful act of Landlord or Tenant and/or any party
acting by, through or under Landlord or Tenant; provided, however, that the
foregoing will not operate to limit Landlord’s right to seek and/or recover the
full extent of damages contemplated by Section 0, and provided further that, for
purposes of this Lease, the damages Landlord is permitted to recover under this
Section 0 will not be considered to be consequential, punitive, or special
damages.

 

Landlord’s Right to Perform. Following an Event of Default by Tenant, Landlord,
without being under any obligation to do so and without thereby waiving any such
failure or Event of Default, as applicable, may make such payment and/or remedy
such other failure at the expense of Tenant without further prior notice to
Tenant (and enter the Premises for such purpose), and all sums expended by, or
expenses incurred by, Landlord (including reasonable attorney’s fees) in making
such payment or performing such obligation shall be deemed to be Additional Rent
under this Lease and shall be due and payable upon demand by Landlord, together
with interest thereon at the Default Rate from the date of such demand until
fully paid.

 

Furniture, Fixtures and Equipment. In the event that Landlord shall have taken
possession of the Premises pursuant to the authority herein granted, then
Landlord shall have the right to remove from the Premises (without the necessity
of obtaining a writ of distress or other legal process) all or any portion of
such furniture, fixtures, equipment and other property located thereon and to
place same in storage at any Premises within the County in which the Premises is
located; and in such event, Tenant shall be liable to Landlord for all costs
incurred by Landlord in connection with such removal and storage. Landlord shall
also have the right to relinquish possession of all or any portion of such
furniture, fixtures, equipment and other property to any person (“Claimant”)
claiming to be entitled to possession thereof who presents to Landlord a copy of
any instrument represented to Landlord by Claimant to have been executed by
Tenant (or any predecessor Tenant) granting Claimant the right under various
circumstances to take possession of such furniture, fixtures, equipment or other
property, without the necessity on the part of Landlord to inquire into the
authenticity of said instrument’s copy of Tenant’s or Tenant’s predecessor’s
signature(s) thereon and without the necessity of Landlord making any
investigation or inquiry as to the validity of the factual or legal basis upon
which Claimant purports to act; and Tenant agrees to indemnify and hold the
Landlord Indemnitees harmless from all cost, expense, loss, damage and liability
incident to Landlord’s relinquishment of possession of all or any portion of
such furniture, fixtures, equipment or other property to Claimant. The right of
Landlord herein stated shall be in addition to any and all other rights which
Landlord has or may hereafter have at law or in equity; and Tenant stipulates
and agrees that the rights herein granted Landlord are commercially reasonable.

 

 18 

 

 

Landlord Default. If, during the Term, Landlord defaults in fulfilling any of
its covenants, obligations or agreements set forth in this Lease, Tenant may
give Landlord notice of such default and, if at the expiration of 30 days after
delivery of such notice, such default will continue to exist, or in the event of
a default which cannot with due diligence be cured within a period of 30 days,
if Landlord fails to proceed promptly after the delivery of such notice (and, in
any event, within such 30-day period) or does not diligently complete such cure
within 90 days after such notice from Tenant, then Tenant will be entitled to
exercise any right or remedy available to Tenant at law or in equity by reason
of such default, except to the extent expressly waived or limited by the terms
of this Lease. Notwithstanding the foregoing, however, if Tenant has been
notified of the name and address of any mortgagee, ground lessor, trust deed
holder, and/or sale-leaseback lessor of Landlord’s interest in the Building,
then Tenant will not exercise any remedy as a result of Landlord’s default
unless and until Tenant has given any such mortgagee, ground lessor, trust deed
holder and/or sale-leaseback lessor, by registered or certified mail, a copy of
any notice of default served upon Landlord simultaneously with the delivery of
notice to Landlord. Tenant further agrees that if Landlord fails to cure such
default within the time period prescribed above, then such mortgagee, ground
lessor, trust deed holder, and/or sale-leaseback lessor will have an additional
30-day period to cure such default or if such default cannot be cured within
that time, then such additional time as may be necessary if within such 30-day
period such mortgagee, ground lessor, trust deed, and/or sale-leaseback lessor
has commenced and is diligently pursuing the cure of such default (including,
but not limited to, commencement of foreclosure proceedings, if necessary to
effect such cure). Notwithstanding anything to the contrary set forth in this
Lease, Tenant shall not have the right to perform self-help or abate Rent except
as otherwise expressly set forth in this Lease.

 

LANDLORD’S LIEN.

 

Notwithstanding anything in this Lease to the contrary, Landlord hereby waives
any statutory or common law lien with respect to Tenant’s personal property.
Upon Tenant’s written request therefor, Landlord will execute a landlord consent
in a form reasonably acceptable to Landlord in connection with a purchase money
financing required by Tenant to purchase any of the goods, wares, equipment,
fixtures, furniture, inventory, accounts, contract rights, chattel paper and
other personal property encumbered by such lien.

 

MORTGAGES; ATTORNMENT.

 

Subordination. This Lease shall be subordinate to any deed of trust, mortgage,
or other security instrument (each, a “Mortgage”), or any ground lease, master
lease, or primary lease (each, a “Primary Lease”), that now or hereafter covers
all or any part of the Premises, the Building, the Land and other improvements
located on the Land (the mortgagee under any such Mortgage, beneficiary under
any such deed of trust, or the lessor under any such Primary Lease is referred
to herein as a “Landlord’s Mortgagee”). Any Landlord’s Mortgagee may elect at
any time, unilaterally, to make this Lease superior to its Mortgage, Primary
Lease, or other interest in the Premises by so notifying Tenant in writing. The
provisions of this Section shall be self-operative and no further instrument of
subordination shall be required; however, in confirmation of such subordination,
Tenant shall execute and return to Landlord (or such other party designated by
Landlord) within 10 days after written request therefor such documentation, in
recordable form if required, as a Landlord’s Mortgagee may reasonably request to
evidence the subordination of this Lease to such Landlord’s Mortgagee’s Mortgage
or Primary Lease (including, without limitation, the Subordination,
Non-Disturbance and Attornment Agreement attached hereto as Exhibit F) or, if
Landlord’s Mortgagee so elects, the subordination of such Landlord’s Mortgagee’s
Mortgage or Primary Lease to this Lease.

 

 19 

 

 

Notice to Mortgagee. Tenant shall not seek to enforce any remedy it may have for
any default on the part of Landlord without first giving written notice by
certified mail, return receipt requested, specifying the default in reasonable
detail, to any Landlord’s Mortgagee whose address has been given to Tenant, and
affording such Landlord’s Mortgagee an opportunity to perform Landlord’s
obligations hereunder in accordance with Section 0 above.

 

Non-Disturbance. Notwithstanding anything contained herein, with respect to any
interest or other mortgagee interest, as long as Tenant is not in default in the
payment of Rent to be paid by Tenant under this Lease, and the performance of
all covenants, agreements and conditions to be performed by Tenant under this
Lease after receipt of any applicable notice and the expiration of any
applicable cure period, and provided that Tenant attorns to the party acquiring
title to the Premises as a result of the foreclosure, termination or transfer in
lieu thereof of any such interest, then neither Tenant’s right to quiet
enjoyment under this Lease, nor the right of Tenant to continue to occupy the
Premises and to conduct its business thereon, in accordance with the terms of
this Lease, will be interfered with by the holder of any such interest or by any
successor thereto or any successor to Landlord as a result of the foreclosure or
termination thereof or transfer in lieu thereof, or by virtue of any such
foreclosure, termination, or transfer.

 

Mortgagee’s Liability. If Landlord’s Mortgagee shall succeed to the interest of
Landlord under this Lease, Landlord’s Mortgagee shall not be: (i) liable for any
act or omission of any prior lessor (including Landlord) unless of a continuing
nature; (ii) bound by any rent or additional rent or advance rent which Tenant
might have paid for more than the current month to any prior lessor (including
Landlord), and all such rent shall remain due and owing, notwithstanding such
advance payment; or (iii) bound by the Security Deposit or any security or
advance rent deposit made by Tenant which is not delivered or paid over to
Landlord’s Mortgagee and with respect to which Tenant shall look solely to
Landlord for refund or reimbursement. Landlord’s Mortgagee shall have no
liability or responsibility under or pursuant to the terms of this Lease or
otherwise after it ceases to own an interest in the Building. Nothing in this
Lease shall be construed to require Landlord’s Mortgagee to see to the
application of the proceeds of any loan, and Tenant’s agreements set forth
herein shall not be impaired on account of any modification of the documents
evidencing and securing any loan.

 

Attornment. If the interest of Landlord is transferred to any person (a
“Successor Landlord”) by reason of the termination or foreclosure, or
proceedings for enforcement, of a Mortgage or Primary Lease, by delivery of a
deed in lieu of such foreclosure or proceedings, or in connection with any other
sale or other conveyance of Landlord’s interest in the Premises, Tenant will
immediately and automatically attorn to the Successor Landlord. Upon attornment,
this Lease will continue in full force and effect as a direct lease between the
Successor Landlord and Tenant. Tenant agrees, upon request by and without cost
to the Successor Landlord, to promptly execute and deliver to the Successor
Landlord such instrument(s) as may be reasonably required to evidence such
attornment.

 

 20 

 

 

MECHANICS LIENS.

 

Tenant shall not permit any mechanic’s liens to be filed against the Premises,
the Building, or the Land. Upon completion of any non-routine service,
improvement or alteration that exceeds the aggregate cost of $5,000.00 in any
calendar year, Tenant shall deliver to Landlord final lien waivers from all
contractors involved in such work. If such a lien is filed, then Tenant shall,
within 20 days after Landlord has delivered notice of the filing thereof to
Tenant (or such earlier time period as may be necessary to prevent the
forfeiture of the Premises, the Building, the Land or any interest of Landlord
therein or the imposition of a civil or criminal fine with respect thereto),
either: (a) pay the amount of the lien and cause the lien to be released of
record; or (b) discharge the same, by the deposit of a bond or other security
with a court sufficient in form, content and amount to procure the discharge of
such lien. If Tenant fails to timely take either such action, then Landlord may
pay the lien claim, and any amounts so paid, including expenses and interest,
shall be paid by Tenant to Landlord within 20 days after Landlord has invoiced
Tenant therefor. Landlord and Tenant acknowledge and agree that their
relationship is and shall be solely that of “landlord-tenant” (thereby excluding
a relationship of “owner-contractor,” “owner-agent” or other similar
relationships). Accordingly, all prospective contractors are hereby charged with
notice that they look exclusively to Tenant to obtain payment for same, and that
Tenant has no authority to cause Landlord to enter into any contract. Nothing
herein shall be deemed a consent by Landlord to any liens being placed upon the
Premises, the Building, the Land or Landlord’s interest therein due to any work
performed by or for Tenant or deemed to give any Contractor any right or
interest in any funds held by Landlord to reimburse Tenant for any portion of
the cost of such work. Tenant shall indemnify, defend and hold harmless the
Landlord Indemnitees from and against all claims, demands, causes of action,
suits, judgments, damages and expenses (including attorneys’ fees) in any way
arising from or relating to the failure by Tenant to pay for any work performed,
materials furnished, or obligations incurred by or at the request of Tenant. The
foregoing indemnity shall survive termination or expiration of this Lease.

 

NOTICES.

 

Each provision of this Lease or of any applicable Laws and other requirements
with reference to the sending, mailing or delivery of any notice or the making
of any payment by Landlord to Tenant or with reference to the sending, mailing
or delivery of any notice or the making of any payment by Tenant to Landlord
shall be deemed to be complied with when and if the following steps are taken:

 

Tenant’s Payments. Tenant will concurrently with the execution of this Lease
provide an automatic debiting authorization for Rent in the form approved by
Landlord by which monthly installments of Rent due under this Lease are
automatically deducted from Tenant’s bank account and credited to Landlord’s
bank account. Tenant’s obligations to pay Rent and any other amounts to Landlord
under the terms of this Lease shall not be deemed satisfied until such Rent and
other amounts have been actually received by Landlord.

 

Landlord’s Payments. All payments required to be made by Landlord to Tenant
hereunder shall be payable to Tenant at the address hereinbelow set forth, or at
such other address within the continental United States as Tenant may specify
from time to time by written notice delivered in accordance herewith.

 

 21 

 

 

Method of Delivery; Addresses. All notices and other communications or
deliveries given pursuant to this Lease shall be in writing and shall be either:
(i) mailed by first class, United States Mail, postage prepaid, certified, with
return receipt requested, and addressed to the parties hereto at the address
specified below in this Section 0; (ii) hand delivered to the intended
addressee; (iii) sent by a nationally recognized overnight courier service; or
(iv) sent by email with a delivery confirmation receipt from the intended
addressee. All notices shall be effective upon the earlier to occur of actual
receipt, one business day following deposit with a nationally recognized
overnight courier service, or three days following deposit in the United States
mail. The parties hereto may change their addresses by giving written notice
thereof to the other in conformity with this provision. The initial notice
addresses for Landlord and Tenant are as follows:

 

LANDLORD: TENANT:    

All notices and other written communications to Landlord under this Lease should
be sent to:

 

GIG CW Compark, LLC
c/o C W Financial Services LLC
Attention: Regina Lubin
555 5th Avenue, 10th floor
New York, New York 10017
E-mail: rlubin@cwcapital.com

Zynex, Inc.
9555 S. Maroon Circle
Englewood, Colorado 80112
Attn: Dan Moorhead
E-mail: dmoorhead@zynex.com    

With a copy to:

 

Kenai Capital Advisors
6732 W. Coal Mine Avenue, Suite 2323
Littleton, Colorado 80123
Attention: Jules Sherwood
Phone: (720) 744-2701
E-mail: jsherwood@kenaicap.com

     

Property management or accounting inquiries should be sent to:

 

Kenai Capital Advisors
6732 W. Coal Mine Avenue, Suite 2323
Littleton, Colorado 80123
Attention: Jules Sherwood
Phone: (720) 744-2701
E-mail: jsherwood@kenaicap.com

 

 

HAZARDOUS MATERIALS

 

Certain Definitions. For purposes of this Lease, “Hazardous Materials” shall
include all solid, liquid or gaseous materials defined or regulated as wastes
under any federal statute or regulation or any state or local Laws and shall
further include all other substances defined or regulated as pollutants or as
hazardous, toxic, infectious, or radioactive substances under any Environmental
Law. “Environmental Law” means any federal, state or local statute, law, rule,
regulation, ordinance, code, policy or rule of common law now or hereafter in
effect and in each case as amended, and any judicial or administrative
interpretation thereof, including any judicial or administrative order, consent
decree or judgment, relating to the environment, health, safety or Hazardous
Materials, including without limitation, the Comprehensive Environmental
Response, Compensation, and Liability Act of 1980, 42 U.S.C. §§ 9601 et seq.;
the Resource Conservation and Recovery Act, 42 U.S.C. §§ 6901 et seq.; the
Hazardous Materials Transportation Act, 49 U.S.C. §§ 1801 et seq.; the Clean
Water Act, 33 U.S.C. §§ 1251 et seq.; the Toxic Substances Control Act, 15
U.S.C. §§ 2601 et seq.; the Clean Air Act, 42 U.S.C. §§ 7401 et seq.; the Safe
Drinking Water Act, 42 U.S.C. §§ 300f et seq.; the Atomic Energy Act, 42 U.S.C.
§§ 2011 et seq.; the Federal Insecticide, Fungicide and Rodenticide Act, 7
U.S.(C) §§ 136 et seq.; the Occupational Safety and Health Act, 29 U.S.C. §§ 651
et seq. “Environmental Claims” means any and all administrative, regulatory or
judicial actions, suits, demands, demand letters, claims, liens, notices of
non-compliance or violation, investigations, proceedings, consent orders or
consent agreements relating in any way to any Environmental Law or any
Environmental Permit, including without limitation (i) any and all Environmental
Claims by governmental or regulatory authorities for enforcement, cleanup,
removal, response, remedial or other actions or damages pursuant to any
applicable Environmental Law and (ii) any and all Environmental Claims by any
third party seeking damages, contribution, indemnification, cost recovery,
compensation or injunctive relief resulting from Hazardous Materials or arising
from alleged injury or threat of injury to health, safety or the environment.
“Environmental Permits” means all permits, approvals, identification numbers,
licenses and other authorizations required under any applicable Environmental
Law.

 

 22 

 

 

Hazardous Materials Activities. Tenant shall not cause or permit any Hazardous
Materials to be used, generated, stored or disposed of on, under or about, or
transported to or from the Premises, the Building, or the Land (collectively,
“Hazardous Materials Activities”) except for limited quantities used or stored
at the Premises and required in connection with the routine operation and
maintenance of the Premises, and then only in compliance with all applicable
Environmental Laws and Environmental Permits, which compliance shall be at
Tenant’s sole cost and expense. Tenant shall not install any storage tank
(whether above or below the ground) on the Premises without obtaining the prior
written consent of Landlord, which consent may be withheld in Landlord’s sole
and absolute discretion for any reason whatsoever or no reason at all.
Additionally, Tenant shall not cause or permit any Hazardous Materials to be
disposed of on, under or about the Premises, without the express prior written
consent of Landlord, which may be withheld for any reason and may be revoked at
any time. If any lender or governmental agency shall ever require testing to
ascertain whether or not there has been any release of Hazardous Materials in,
on, or about the Premises, as a result of any evidence reasonably indicating
such release during the Term hereof resulting from the acts or omissions of
Tenant, its employees, agents or contractors, then the reasonable costs thereof,
together with interest thereon at the Default Rate from the date of such demand
until fully paid, shall be reimbursed by Tenant to Landlord, upon demand, as
Additional Rent if such requirement applies to Tenant’s use and occupancy of the
Premises.

 

Duty to Notify Landlord. Tenant will immediately advise Landlord in writing of
any of the following: (i) any pending or threatened Environmental Claim against
Tenant relating to the Premises, the Building, or the Land; (ii) any condition
or occurrence on the Premises, the Building, or the Land that (a) results in
noncompliance by Tenant with any applicable Environmental Law, or (b) could
reasonably be anticipated to form the basis of an Environmental Claim against
Tenant or Landlord, the Premises, the Building, or the Land; (iii) any condition
or occurrence on the Premises or any property adjoining the Premises that could
reasonably be anticipated to cause the Premises to be subject to any
restrictions on the ownership, occupancy, use or transferability of the Premises
under any Environmental Law; and (iv) the actual or anticipated taking of any
removal or remedial action by Tenant in response to the actual or alleged
presence of any Hazardous Material on the Premises, the Building, or the Land.
All such notices shall describe in reasonable detail the nature of the claim,
investigation, condition, occurrence or removal or remedial action and Tenant’s
response thereto. In addition, Tenant will provide Landlord with copies of all
communications regarding the Premises with any governmental agency relating to
Environmental Laws, all such communications with any person relating to
Environmental Claims, and such detailed reports of any such Environmental Claim
as may reasonably be requested by Landlord.

 

Liability and Indemnity. Prior to the Effective Date, Landlord will deliver
copies of Landlord’s existing environmental reports. As of the Effective Date,
to Landlord’s knowledge, except as otherwise disclosed in the delivered reports,
there are no Hazardous Materials located in, on, or under the Building, the
Premises, or the Land. Landlord shall not be liable to Tenant or to any other
party for any Hazardous Materials Activities conducted or permitted on, under or
about the Premises, the Building, or the Land by Tenant or by Tenant’s
employees, agents, contractors, licensees or invitees, and Tenant shall
indemnify, defend and hold the Landlord Indemnitees harmless from any claims,
damages, fines, penalties, losses, judgments, costs and liabilities arising out
of or related to (i) any Hazardous Materials Activities conducted or permitted
on, under or about the Premises, the Building, or the Land by Tenant or by
Tenant’s employees, agents, contractors, licensees or invitees, regardless of
whether Landlord shall have consented to, approved of, participated in or had
notice of such Hazardous Materials Activities or (ii) any Environmental Claim
relating in any way to Tenant’s operation or use of the Premises. Landlord shall
indemnify, defend, and hold Tenant and Tenant’s employees, agents, contractors
and licensees harmless from and against any and all claims arising out of or
involving (A) the introduction of any Hazardous Materials prior to the
Possession Date or (B) the existence of any Hazardous Materials to the extent
caused by Landlord or by Landlord’s employees, agents, contractors, or licensees
during the Term. The provisions of this Section 0 shall survive the expiration
or termination of this Lease.

 

 23 

 

 

End of Term. On or prior to the Expiration Date or earlier termination of this
Lease, Tenant shall remove from the Premises, at Tenant’s sole expense, all
Hazardous Materials located, stored and disposed of on, under or about the
Premises as a result of Hazardous Materials Activities conducted or permitted
on, under or about the Premises, the Building, or the Land by Tenant or by
Tenant’s employees, agents, contractors, or licensees. Tenant shall close,
remove or otherwise render safe any buildings, tanks, containers or other
facilities related to the Hazardous Materials Activities conducted or permitted
on the Premises in the manner required by all applicable Laws. The covenants set
forth in this Section 0 shall survive expiration or earlier termination of this
lease.

 

No Change of Use. Tenant will not change, or permit to be changed, the use of
the Premises permitted under Section 0 hereof unless Tenant shall have notified
Landlord thereof in writing and Landlord shall have determined, in its sole and
absolute discretion, that such change will not result in the presence of
Hazardous Materials on the Premises except for those described in Section 0
above.

 

Existing Hazardous Materials. Tenant’s indemnification of Landlord under this
Section 0 shall not be applicable to any Hazardous Materials that were located
on the Premises, the Building, or the Land on the Commencement Date, nor any
Hazardous Materials placed on the Premises, the Building, or the Land by
Landlord, its employees, agents, or contractors.

 

INSOLVENCY OR BANKRUPTCY.

 

The appointment of a receiver to take possession of all or substantially all of
the assets of Tenant, or an assignment of Tenant for the benefit of creditors,
or any action taken or suffered by Tenant under any insolvency, bankruptcy, or
reorganization act, shall at Landlord’s option constitute an Event of Default
hereunder. Upon the happening of any such event or at any time thereafter, this
Lease shall terminate five days after written notice of termination from
Landlord to Tenant. In no event shall this Lease be assigned or assignable by
operation of law or by voluntary or involuntary bankruptcy proceedings or
otherwise and in no event shall this Lease or any rights or privileges hereunder
be an asset of Tenant under any bankruptcy, insolvency, or reorganization
proceedings.

 

LANDLORD’S LIABILITY.

 

Any liability of Landlord hereunder shall be enforceable only out of Landlord’s
interest in and to the Building and the Land (including, without limitation, any
rental income or sales proceeds) and in no event out of the separate assets of
any constituent partner of Landlord. Neither Landlord nor any of its respective
officers, directors, employees, heirs, successors, or assigns, shall have any
personal liability of any kind or nature, directly or indirectly, under or in
connection with this Lease. No holder or beneficiary of any mortgage or deed of
trust on any part of the Premises, the Building, or the Land shall have any
liability to Tenant hereunder for any default of Landlord.

 

 24 

 

 

MISCELLANEOUS.

 

Confidentiality. Tenant acknowledges that the terms and conditions of this Lease
are to remain confidential for Landlord’s benefit, and may not be disclosed by
Tenant to anyone, by any manner or means, directly or indirectly, without
Landlord’s prior written consent. The consent by Landlord to any disclosures
shall not be deemed to be a waiver on the part of Landlord of any prohibition
against any future disclosure. However, Tenant may disclose lease terms,
provisions and conditions to Tenant’s accountants, attorneys, consultants,
advisors, investors, lease administrators, managing employees and others in
contractual privity with Tenant (“Permitted Recipients”), as reasonably
necessary for Tenant’s business purposes, without such prior consent; provided
that Tenant agrees to inform such Permitted Recipients of the confidential
nature of this Lease and the confidentiality agreements of Tenant set forth
herein will apply to and bind such parties.

 

Interpretation. Words of any gender used in this Lease shall be held and
construed to include any other gender, and words in the singular number shall be
held to include the plural, unless the context otherwise requires.

 

Brokers. Landlord and Tenant represent and warrant that no broker or agent
negotiated or was instrumental in negotiating or consummating this Lease except
the Brokers. Neither party knows of any other real estate broker or agent who is
or might be entitled to a commission or compensation in connection with this
Lease. Landlord will pay all fees, commissions or other compensation payable to
the Brokers to be paid by Landlord according to Section 0. Tenant and Landlord
will indemnify and hold each other harmless from all damages paid or incurred by
the other resulting from any claims asserted against either party by any other
brokers or agents claiming through the other party.

 

Successors and Assigns. Subject to the provisions of Section 0 above, the terms,
provisions and covenants and conditions contained in this Lease shall apply to,
inure to the benefit of, and be binding upon the parties hereto and upon their
respective heirs, legal representatives, successors and permitted assigns,
except as otherwise herein expressly provided. Landlord shall have the right to
assign any of its rights and obligations under this Lease. Each party agrees to
furnish to the other, promptly upon demand, a corporate resolution, proof of due
authorization by partners, or other appropriate documentation evidencing the due
authorization of such party to enter into this Lease.

 

Captions. The captions inserted in this Lease are for convenience only and in no
way define, limit or otherwise describe the scope or intent of this Lease, or
any provision hereof, or in any way affect the interpretation of this Lease.

 

Estoppel. Promptly upon the occurrence of the Commencement Date, Tenant will
execute and deliver to Landlord a Commencement Date Certificate in the form of
Exhibit E, accurately prepared. Tenant agrees from time to time, not to exceed
once per calendar year unless in connection with a bona fide sale or financing,
within 20 days after request of Landlord, to deliver to Landlord, or Landlord’s
designee a certificate of occupancy (if applicable) and an estoppel certificate
stating that this Lease is in full force and effect, and the date to which Rent
has been paid, the unexpired Term of this Lease and such other matters
pertaining to this Lease as may be reasonably requested by Landlord. It is
understood and agreed that Tenant’s obligation to furnish such estoppel
certificates within such 20-day period is a material inducement for Landlord’s
execution of this Lease.

 

Amendment. This Lease may not be altered, changed or amended except by an
instrument in writing signed by both parties hereto.

 

 25 

 

 

Survival. All obligations of Tenant hereunder not fully performed as of the
Expiration Date or earlier termination of the Term of this Lease shall survive
the expiration or earlier termination of the Term hereof, including without
limitation all payment obligations with respect to Taxes and insurance costs and
all obligations concerning the condition of the Premises and all other
Additional Rent.

 

Partial Invalidity. If any clause or provision of this Lease is illegal, invalid
or unenforceable under present or future Laws effective during the Term of this
Lease, then and in that event, it is the intention of the parties hereto that
the remainder of this Lease shall not be affected thereby, and it is also the
intention of the parties to this Lease that in lieu of each clause or provision
of this Lease that is illegal, invalid or unenforceable, there be added as a
part of this Lease contract a clause or provision as similar in terms to such
illegal, invalid or unenforceable clause or provision as may be possible and be
legal, valid and enforceable.

 

Offer Subject to Revocation. Because the Premises are on the open market and are
presently being shown, this Lease shall be treated as an offer with the Premises
being subject to prior lease and such offers subject to revocation or
non-acceptance by Landlord or to other use of the Premises without notice, and
this Lease shall not be valid or binding unless and until fully executed by
Landlord and Tenant.

 

Time of the Essence. Time is of the essence of this Lease and all of its
provisions. This Lease in all respects shall be governed by the Laws of the
State in which the Premises are located.

 

Obligations to Landlord and Others. The duties and obligations of Tenant shall
run and extend not only to the benefit of Landlord, as named herein, but to the
benefit of either of the following, at such party’s option: (i) any person by,
through or under which Landlord derives the right to lease the Premises; and
(ii) holders of mortgage or rent assignment interests in the Premises, as their
respective interests may appear; provided, however, nothing contained herein
shall be construed to obligate Tenant to pay Rent to any person other than
Landlord until such time as Tenant has been given written notice of either an
exercise of a rent assignment or the succession of some other party to the
interests of Landlord.

 

No Waiver. If either Landlord or Tenant waives the performance of any term,
covenant or condition contained in this Lease, such waiver shall not be deemed
to be a waiver of any subsequent breach or nonperformance of the same or any
other term, covenant or condition contained herein. Furthermore, the acceptance
of rent by Landlord shall not constitute a waiver of any preceding breach by
Tenant of any term, covenant or condition of this Lease, regardless of
Landlord’s knowledge of such preceding breach at the time Landlord accepted such
rent. Failure by either party to enforce any of the terms, covenants or
conditions of this Lease for any length of time shall not be deemed to waive or
to decrease the right of such party to insist thereafter upon strict performance
by the other party. Waiver by Landlord or Tenant of any term, covenant or
condition contained in this Lease may only be made by a written document signed
by Landlord and Tenant.

 

Interest. Except as otherwise expressly provided herein, any sum accruing to
Landlord under the provisions of this Lease which shall not be paid when due
shall bear interest, commencing on the fifth day after the date that such amount
is was due, at the rate equal to the lesser of (i) 20%, and (ii) the maximum
amount permitted by Laws (the “Default Rate”).

 

Counterparts; Facsimile Signatures. This Lease may be executed in counterparts,
each of which will constitute an original, but all of which, when taken
together, will constitute but one agreement. Executed copies hereof may be
delivered by telecopier, email or other electronic means and upon receipt will
be deemed originals and binding upon the parties hereto, regardless of whether
originals are delivered thereafter.

 

 26 

 

 

Business Day. As used herein, the term “business day” shall mean all days,
excluding Saturdays, Sundays and all days observed by either the State in which
the Premises are located or the United States government as legal holidays. In
the event that any date for performance falls on a day other than a business
day, then performance shall be postponed until the next business day.

 

Rules. Landlord shall notify Tenant in writing at least 30 days in advance of
any new or modified rules and regulations (or other rules or procedures) from
time to time established, and (ii) in the event of any conflict between any
provision of this Lease and any rules and regulations (or other rules or
procedures), the provisions of this Lease shall control and prevail.
Notwithstanding anything contained herein to the contrary, Landlord shall not
establish any new or modified rules and regulations (or other rules or
procedures) that materially and adversely affect Tenant’s ability to use the
Premises for the Permitted Use.

 

Force Majeure. Neither Landlord nor Tenant will be liable to the other for a
delay or failure to perform its obligations under this Lease if and to the
extent such delay or failure is a result of Force Majeure (as defined below);
provided, however, that Force Majeure will not excuse the timely performance of
Tenant’s obligations to (i) pay Rent (except as expressly provided in Section 0
above); (ii) surrender the Premises to Landlord at the end of the Term in
accordance with Section 0 of this Lease; and (iii) maintain the insurance
policies and coverages required of Tenant in Exhibit D of this Lease. The amount
of time for a party claiming Force Majeure (the “Affected Party”) to perform its
obligations under this Lease (except for the Tenant obligations set forth above)
will be extended by the amount of time that the Affected Party is delayed in
performing such obligation as a result of Force Majeure. Notwithstanding the
foregoing, the Affected Party shall use all commercially reasonable efforts to
resume normal performance of its obligations under this Lease as soon as
reasonably possible, and, to the extent that the Affected Party fails to use
commercially reasonable efforts to overcome or mitigate the effect of Force
Majeure on its obligations, the Affected Party shall not be excused for any
delay or failure in performance that would have been avoided by using such
commercially reasonable efforts.

 

For purposes of this Lease, “Force Majeure” means any act, event or circumstance
that is not reasonably within the control of, does not result from the
negligence of, and would not have been avoided or overcome by the exercise of
reasonable prudence or diligence by the Affected Party, including, but not
limited to, the following: fire; flood; atmospheric disturbance; lightning
storm; hurricane; cyclone; typhoon; tidal wave; tornado; earthquake; explosion;
volcanic eruption; landslide; epidemic; pandemic; public health emergencies;
outbreaks of disease or illness; acts of war (whether declared or undeclared);
invasion; armed conflict; embargo; terrorism; bioterrorism; riot; civil
commotion; power outage; failure or disruption of utility services; strike;
lockout; shortages of labor or materials; unusual delays by common carriers;
acts after the date of this Lease by a governmental entity or other authority
having jurisdiction, including the issuance or promulgation of any court order,
executive order, Law, directive or interpretation, the effect of which would
prevent, delay, or make unlawful the Affected Party’s performance hereunder; and
any other act, event or circumstance that is not reasonably within the control
of, does not result from the negligence of, and would not have been avoided or
overcome by the exercise of reasonable prudence or diligence by the Affected
Party, whether similar or dissimilar in kind and nature to any of the foregoing
events.

 

RENEWAL RIGHT.

 

Grant of Right. Subject to the terms and provisions of this Section 0, Tenant,
at its option, may extend the Term of this Lease for one period of 60 months at
the end of the Term (the “Renewal Term”) with respect to the Premises as it
exists as of the last day of the Term (the “Renewal Option”). To exercise such
Renewal Option, Tenant must deliver notice of the exercise thereof (a “Renewal
Notice”) to Landlord no earlier than 15 months and no later than nine months
prior to the expiration of the initial Term.

 

 27 

 

 

Determination of Market Rental Rate. Within 10 days after Tenant delivers a
Renewal Notice, Landlord will notify Tenant (the “Rate Notice”) of the “Market
Rental Rate” (as defined below). If Tenant agrees that the rental rate set forth
in the Rate Notice is the Market Rental Rate, such rental rate will be the
Market Rental Rate for the purposes of this Section 0, and Base Rent for the
applicable Renewal Term will be the Market Rental Rate. If Tenant disagrees with
the Market Rental Rate in the Rate Notice, then Tenant will have 10 days after
receipt of the Rate Notice to object to the rental rate in the Rate Notice by
giving notice to Landlord. If Tenant fails to object within such 10 day period,
Tenant will be deemed to have agreed that the Rate Notice contains the Market
Rental Rate. If Tenant timely notifies Landlord of Tenant’s objection to the
rate set forth in the Rate Notice, then Landlord and Tenant will, for a period
of 10 days from and after Tenant gives its objection to the Rate Notice,
negotiate to determine a Market Rental Rate acceptable to both Landlord and
Tenant.

 

Parties’ Brokers. If the parties are unable to agree upon the Market Rental Rate
during such 10 day period, then, within seven days after the expiration of such
10-day period, Landlord and Tenant will each appoint their own licensed real
estate broker who has at least 10 years’ full-time leasing experience in the
Englewood, Colorado industrial market (the “Parties’ Brokers”). The Parties’
Brokers will negotiate in good faith for 10 days after the date that both
Parties’ Brokers have been appointed to determine a Market Rental Rate
acceptable to both Landlord and Tenant. If the Parties’ Brokers cannot reach
agreement on the Market Rental Rate within such 10-day period, then within five
days after the expiration of such 10-day period, Landlord will deliver to Tenant
a written determination of the Market Rental Rate as determined by Landlord and
its broker using the criteria set forth below (“Landlord’s Determination”).
Tenant will have five days from the date of Landlord’s delivery of Landlord’s
Determination to notify Landlord of Tenant’s acceptance of Landlord’s
Determination or deliver to Landlord Tenant’s written determination of the
Market Rental Rate using the criteria set forth below (“Tenant’s
Determination”). If Tenant does not deliver Tenant’s Determination to Landlord
within such five-day period, Tenant will be deemed to have accepted Landlord’s
Determination and the rental rate set forth in Landlord’s Determination will be
the Market Rental Rate. If Tenant does deliver Tenant’s Determination within
such five-day period, then the Parties’ Brokers will have an additional seven
days from the date of delivery of Tenant’s Determination to negotiate a Market
Rental Rate acceptable to both Landlord and Tenant.

 

Third Broker. If no agreement can be reached as to the Market Rental Rate within
such seven-day period, then, within five days after such seven-day period
expires, the Parties’ Brokers will appoint a third broker (the “Third Broker”).
The Third Broker will be a person who has not previously acted in any capacity
for either party and who meets the same experience qualifications as required
for the Parties’ Brokers. Within 10 days of his or her appointment, the Third
Broker will review Landlord’s Determination and Tenant’s Determination of the
Market Rental Rate and such other information as he or she deems necessary and
will select either Landlord’s Determination or Tenant’s Determination of the
Market Rental Rate (but no other rate) as being more reasonable. The Third
Broker will be instructed, in deciding whether Landlord’s Determination or
Tenant’s Determination is more reasonable, to use the criteria as to the Market
Rental Rate set forth below. The Third Broker will immediately notify the
parties of his or her selection of the Landlord’s Determination or the Tenant’s
Determination as being more reasonable, and then such selected determination
will be the Market Rental Rate. Each of the parties will bear the entire cost of
their own broker and 1/2 of the cost of the Third Broker.

 

 28 

 

 

Interim Rate. Notwithstanding anything in this Lease to the contrary, if no
agreement can be reached as to the Market Rental Rate prior to the expiration of
the Term, Tenant shall pay Base Rent to Landlord in accordance with the rental
rate for the last period during the initial Term (the “Interim Rate”) for the
period (the “Interim Period”) beginning on the day immediately following the
last day of the Term, and ending on the date the Market Rental Rate is
determined pursuant to this Section 0 (the “Determination Date”). If the amount
of Base Rent Tenant paid to Landlord during the Interim Period, prorated based
on the number of days in such period (the “Interim Base Rent”), is more than the
amount Tenant would have paid if the Market Rental Rate had been in effect
during such Interim Period, Landlord will credit such excess amount against the
next payment(s) of Base Rent due from Tenant to Landlord. If the Interim Base
Rent is less than the amount Tenant would have paid if the Market Rental Rate
had been in effect during such Interim Period, Tenant will pay the deficiency to
Landlord within 30 days after the Determination Date.

 

Market Rental Rate Defined. “Market Rental Rate” means the prevailing renewal
rate then charged by landlords of similar buildings in the Englewood, Colorado
industrial market of comparable quality and age as the Building for similar
space with a similar quality of improvements and percentage of office built out
to tenants similar to Tenant in size, credit quality and stature, taking into
account the length of the Renewal Term.

 

After Exercise. During the Renewal Term, all of the terms and provisions of this
Lease will apply, except that (i) there will be no further right of renewal; and
(b) Base Rent will be payable at the Market Rental Rate, as determined pursuant
to this Section 0, multiplied by the rentable square feet of the Premises as of
the commencement of the Renewal Term. The “Term” of this Lease will include the
properly exercised Renewal Term.

 

Limitations on Tenant’s Rights. At Landlord’s option, Tenant will have no right
to extend the Term, and Tenant’s Renewal Notice will be ineffective, if an Event
of Default exists at the time a Renewal Notice is given or at the time the
Renewal Term is scheduled to commence. Any termination of this Lease terminates
all rights under this Section 0. Except for a Permitted Transfer, any assignment
of this Lease or subletting of Premises by Tenant terminates Tenant’s rights
under this Section 0, unless Landlord consents to the contrary in writing at the
time of such subletting or assignment.

 

[Remainder of page intentionally left blank]

 

 29 

 

 

Having read and intending to be bound by the terms and provisions of this Lease,
Landlord and Tenant have signed it as of the Lease Date.

 

  LANDLORD:       GIG CW COMPARK, LLC, a Delaware limited liability company    
      By: /s/Regina Lubin   Name: Regina Lubin   Title: Chief Investment Officer
          TENANT:       ZYNEX, INC., a Nevada corporation           By: /s/Dan
Moorhead   Name: Dan Moorhead   Title: Chief Financial Officer

 

 30 

 

 

EXHIBIT A

 

THE LAND

 

LOT 4B-1A, COMPARK FILING NO. 2, 6TH AMENDMENT, RECORDED DECEMBER 2, 2004 AT
RECEPTION NO. 2004122556, COUNTY OF DOUGLAS, STATE OF COLORADO.

 

PARCEL 2:

 

THE BENEFICIAL EASEMENTS SET FORTH AND DESCRIBED IN ACCESS AGREEMENT RECORDED
DECEMBER 5, 2012 AT RECEPTION NO. 2012093160, COUNTY OF DOUGLAS, STATE OF
COLORADO.

 

FOR INFORMATION PURPOSES ONLY:

 

TAX PIN: 2233-061-02-006

ADDRESS: 14800 GRASSLANDS DRIVE, ENGLEWOOD, CO

 

Exhibit A

Page 1

 

 

 

 

EXHIBIT B

 

THE PREMISES

 

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Exhibit B

Page 1