Exhibit 10.3

  

LEASE

 

THIS LEASE (this “Lease”) is executed this 21st day of July, 2020 (the
“Effective Date”), by and between PNK S2, LLC, a Georgia limited liability
company (“Landlord”), and PURPLE INNOVATION, LLC, a Delaware limited liability
company (“Tenant”).

 

ARTICLE 1 - LEASE OF PREMISES

 

Section 1.01. Basic Lease Provisions and Definitions. The following defined
terms and other provisions are intended to have the meanings set forth as
follows for all purposes under this Lease:

 

(a) “Leased Premises”: the space commonly known as Suite A, as more particularly
shown on Exhibit A-1 attached hereto and made a part hereof, within the building
located at 1325 Hwy 42 S., Building B, McDonough Georgia, containing 1,104,320
rentable square feet (the “Building”), situated on the “Land” (as hereinafter
defined) in the location shown on Exhibit A-2 attached hereto and made a part
hereof. Tenant shall also have certain rights with respect to the “Oil Tank
Area” (as hereinafter defined) located outside of the Building on the Land, as
set forth in and subject to the terms of Article 20 below. The “Land” is the
real property comprising the “Park” (as hereinafter defined) as of the date of
this Lease, as described in Exhibit A-3 attached hereto and made a part hereof.
The portion of the Land on which the Building is situated, and all improvements
thereon (including, without limitation, the Building), are sometimes herein
referred to collectively as the “Building Project.” As of the date of this
Lease, the Building Project is located within and is a part of a multi-building
business park commonly known as “PNK Park Southern Gateway at Lambert Farms.”
The land and all improvements within such business park, as the same may be
expanded, contracted or otherwise modified from time to time, are sometimes
herein referred to collectively as the “Park.”

 

(b) “Rentable Area”: 519,680 rentable square feet.

 

(c) “Tenant’s Proportionate Share”: 47.0588%, which is a fraction, the numerator
of which is the number of rentable square feet in the Leased Premises, and the
denominator of which is the number of rentable square feet in the Building
(1,104,320 rentable square feet). Should Landlord elect to expand the Building,
this percentage shall be reduced based on the new and increased number of
rentable square feet in the Building, and such reduction in Tenant’s
Proportionate Share shall take effect upon substantial completion of such
expansion.

 

(d) “Minimum Annual Rent” and “Monthly Rental Installments”: means the amounts
set forth in the table below:

  

Lease Year  Rent / SF   Minimum Annual Rent   Monthly Rental Installments:  1* 
$3.41   $1,772,108.80   $147,675.73  2  $3.48   $1,808,486.40   $150,707.20  3 
$3.55   $1,844,864.00   $153,738.67  4  $3.62   $1,881,241.60   $156,770.13  5 
$3.69   $1,917,619.20   $159,801.60  6  $3.76   $1,953,996.80   $162,833.07  7 
$3.84   $1,995,571.20   $166,297.60  8  $3.92   $2,037,145.60   $169,762.13  9 
$4.00   $2,078,720.00   $173,226.67  10  $4.08   $2,120,294.40   $176,691.20 
11  $4.16   $2,161,868.80   $180,155.73 

  

* Subject to the “Rental Concession” (as hereinafter defined)

 

 

 

 

See Article 18 for Minimum Annual Rent and Monthly Rental Installments during
each of the Renewal Terms.

 

(e) “Rental Concession” has the meaning set forth below.

 

(f) “Lease Year”: A Lease Year shall be each twelve (12) month period beginning
on the Commencement Date; provided, however, if the Commencement Date is not the
first day of the month, the first Lease Year shall commence on the Commencement
Date and end on the last day of the twelfth (12th) full calendar month
thereafter and the second and each succeeding Lease Year shall commence on the
first day of the next calendar month.

 

(g) “Target Commencement Date”: The date that is four (4) months after Landlord
obtains all permits and governmental approvals necessary for commencement of
physical construction of the “Landlord’s Work” (as defined in the Work Letter)
in the Leased Premises.

 

(h) “Commencement Date”: the date of “Substantial Completion” (as defined in the
Work Letter) of the Landlord’s Work, as determined under the Work Letter. Prior
to the Commencement Date, Tenant shall have the right to occupy and use the
Leased Premises pursuant and subject to the terms of Section 4.02 of the Work
Letter.

 

(i)“Substantial Completion”: Is defined in the Work Letter.

 

(j) “Lease Term”: The period commencing on the Commencement Date and continuing
through the last day of the calendar month in which the day immediately
preceding the date that is one hundred twenty-eight (128) months after the
Commencement Date occurs, subject to extension under Article 18 hereof (the
“Expiration Date”). The Lease Term shall include all references to any Renewal
Options exercised by Tenant.

 

(k) “Renewal Term” or “Renewal Terms” has the meaning set forth in Article 18.

 

(l) “Security Deposit”: Not applicable.

 

(m) “Broker(s)”: Cushman & Wakefield, Inc., representing Landlord, and Jones
Lang LaSalle Brokerage, Inc., representing Tenant. All commissions to such
Brokers shall be paid pursuant to Section 16.05 of this Lease.

 

(n) “Permitted Use”: Subject to the terms of this Lease, manufacturing,
warehousing, distribution, and office for comfort technology related products,
and other uses related thereto, or any other use allowed by Laws (as defined
herein) and approved by Landlord. Subject to the terms of this Lease, during the
Lease Term, Tenant shall have access to the Leased Premises, the Building and
the related parking facilities (including loading areas and truck ingress and
egress) twenty-four (24) hours per day, seven (7) days per week, fifty-two (52)
weeks per year.

 

(o) Intentionally Omitted.

 

(p) Intentionally Omitted.

 

(q) “Landlord’s Work”: Is defined in the Work Letter.

 

(r) “Work Letter”: means the Work Letter attached to this Lease as Exhibit B.

 

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Addresses for notices are as follows:

  

Landlord: PNK S2, LLC   1100 Peachtree Street   Suite 800   Atlanta, Georgia
30309   Attn: Stiles/Wheeler   Email: [____________________]     Tenant (prior
to occupancy): Purple Innovation, LLC   4100 N. Chapel Ridge Rd.   Suite 200  
Lehi, Utah 84043   Attn: Chief Operating Officer   Email: john.l@purple.com    
Tenant (following occupancy): Purple Innovation, LLC   4100 N. Chapel Ridge Rd.
  Suite 200   Lehi, Utah 84043   Attn: Chief Operating Officer   Email:
john.l@purple.com     With a copy to: Purple Innovation, LLC   4100 N. Chapel
Ridge Rd.   Suite 200   Lehi, Utah 84043   Attn: Legal   Email: legal@purple.com

 

(s) Exhibits:

 

Exhibit A-1: Leased Premises Exhibit A-2: Location of Building Exhibit A-3: Land
Exhibit B: Work Letter Exhibit C: Form of Letter of Understanding Exhibit D:
Rules and Regulations Exhibit E: Approved Tenant Signage Exhibit F: Parking Lot
Exhibit G Permitted Hazardous Substances Exhibit H-1 Oil Tank Area Exhibit H-2
Pre-Approved Plans for Oil Tanks

 

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Section 1.02. Lease of the Leased Premises. Landlord hereby leases to Tenant and
Tenant hereby leases from Landlord the Leased Premises, under the terms and
conditions herein, together with a non-exclusive right, in common with others,
to use the following (collectively, the “Common Areas”): the areas of the
Building and the Building Project, including, without limitation, all areas and
facilities in and around the Building and the Building Project that are provided
for the general, nonexclusive use and convenience of more than one tenant of the
Building, including, without limitation, driveways, parking areas, walkways,
delivery areas, trash removal areas, landscaped areas, entryways, hallways,
stairways, restrooms, parking areas and sidewalks that are designed for use in
common by all tenants of the Building and their respective employees, agents,
contractors, representatives, customers, guests, invitees and others. So long as
the Building Project is a part of the Park, Common Areas also include those
portions of the Park lying outside the Building Project which are designated as
“common areas” for the use, enjoyment and benefit of all owners or tenants of
property located within the Park and their lessees, subtenants and invitees.
Landlord and Tenant agree that, prior to the Effective Date, each of them has
confirmed that the number of rentable square feet contained in the Building and
in the Leased Premises are accurate for all purposes of this Lease, including,
without limitation, for purposes of calculating the amount of Minimum Annual
Rent and Monthly Rental Installments due under this Lease.

 

ARTICLE 2 - LEASE TERM AND POSSESSION

 

Section 2.01. Lease Term. The Lease Term shall commence as of the Commencement
Date and shall expire on the Expiration Date, unless sooner terminated in
accordance with the terms of this Lease. After the Commencement Date has been
determined, Landlord shall send a “Letter of Understanding” in substantially the
form attached hereto as Exhibit C to Tenant, and Tenant shall execute and return
such Letter of Understanding to Landlord within fifteen (15) days after Tenant’s
receipt thereof. If Tenant fails to execute and return such Letter of
Understanding to Landlord within such fifteen (15) day period, the matters set
forth in the Letter of Understanding shall be conclusively presumed to be true
and correct. The parties hereto acknowledge and agree that they have previously
measured the number of square footage in the Leased Premises and the Building
and have mutually agreed on the square footage numbers for the Leased Premises
and the Building appearing in Article 1 hereof.

 

Section 2.02. Construction of Landlord’s Work. Subject to reimbursement by
Tenant of the Excess (as defined in the Work Letter), Landlord agrees to perform
the Landlord’s Work with diligence, subject to events and delays due to causes
beyond Landlord’s reasonable control. Other than as described in the Work
Letter, Tenant shall accept the Leased Premises in its then-current, “as-is”
condition as of the Commencement Date, and Landlord shall have no obligation to
make any improvements or modifications to the Leased Premises. Taking of
possession by Tenant shall be deemed conclusively to establish that the
Landlord’s Work has been completed in accordance with the “Approved Construction
Drawings” (as such term is defined in the Work Letter) and the Work Letter, and
that the Leased Premises, the Building and the Common Areas are in good and
satisfactory condition, as of the date possession was so taken. Subject only to
any abatement to which Tenant is entitled under Section 2.05 below, if Landlord,
for any reason whatsoever, fails to deliver possession of the Leased Premises to
Tenant on any anticipated date, this Lease shall not be void or voidable, nor
shall Landlord be liable to Tenant for any loss or damage resulting therefrom.

 

Section 2.03. Surrender of the Leased Premises. Upon the expiration or earlier
termination of this Lease, Tenant shall, at its sole cost and expense,
immediately (a) surrender the Leased Premises to Landlord in broom-clean
condition and in good order, condition and repair, (b) remove from the Leased
Premises or where located (i) Tenant’s Property (as defined in Section 8.01
below), (ii) all data and communications equipment, wiring and cabling
(including above ceiling, below raised floors and behind walls), and (iii) any
striping applied to the floors of the Leased Premises, and (iv) any improvements
and alterations required to be removed pursuant to Section 7.03 below, and (c)
repair any damage caused by any such removal and restore the Leased Premises to
the condition existing upon the Commencement Date, excepting only reasonable
wear and tear, and casualty and condemnation damage that Landlord is required to
repair under the terms of this Lease. Upon the expiration or earlier termination
of this Lease, all of Tenant’s Property that is not removed within ten (10)
business days following Landlord’s written demand therefor shall be conclusively
deemed to have been abandoned and Landlord shall be entitled to dispose of
Tenant’s Property at Tenant’s cost, without incurring any liability to Tenant.
This Section 2.03 shall survive the expiration or any earlier termination of
this Lease.

 

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Section 2.04. Holding Over. If Tenant retains possession of the Leased Premises
after the expiration or earlier termination of this Lease, Tenant shall be a
tenant at sufferance, and the Monthly Rental Installments payable during such
holdover period shall be as follows: (a) during the first three (3) months, one
hundred twenty-five percent (125%) of the Monthly Rental Installment amount in
effect upon the date of such expiration or earlier termination; (b) thereafter,
one hundred fifty percent (150%) of the Monthly Rental Installment amount in
effect upon the date of such expiration or earlier termination. Such occupancy
of the Leased Premises shall otherwise be upon and subject to all of the terms,
covenants, and conditions herein specified, so far as applicable. Tenant shall
have no right to notice under Official Code of Georgia Annotated §44-7-7 of the
termination of its tenancy. Acceptance by Landlord of Rent (as defined in
Section 3.03 below) after such expiration of the Lease Term or earlier
termination shall not result in a renewal of this Lease, nor shall such
acceptance create a month-to-month tenancy. In the event a month-to-month
tenancy is created by operation of law, either party shall have the right to
terminate such month-to-month tenancy upon thirty (30) days’ prior written
notice to the other, whether or not said notice is given on the date that any
Rent is due. This Section 2.04 shall not be deemed a consent by Landlord to any
holding over by Tenant upon the expiration or earlier termination of this Lease,
nor shall it limit Landlord’s remedies in such event. Tenant shall be liable to
Landlord for all damage which Landlord suffers because of any holding over by
Tenant, and Tenant shall indemnify Landlord against all claims made by any other
tenant or prospective tenant against Landlord resulting from delay by Landlord
in delivering possession of the Leased Premises to such other tenant or
prospective tenant. The provisions of this Section 2.04 shall survive the
expiration or earlier termination of this Lease.

 

Section 2.05. Late Delivery. If the Commencement Date has not occurred (or been
deemed to have occurred) on or before the date that is one (1) month after the
Target Commencement Date (the “Outside Delivery Date”), then Tenant shall
receive a one (1) day abatement of Minimum Annual Rent for each day that the
Commencement Date is delayed beyond the Outside Delivery Date for any reason
other than Force Majeure or Tenant Delay. Notwithstanding anything contained
herein to the contrary, the Outside Delivery Date shall be extended one (1) day
for each day of delay in the Commencement Date caused by Force Majeure or Tenant
Delay. The abatement set forth in this Section 2.05 is and shall be Tenant’s
sole and exclusive remedy for delay in the Commencement Date or failure of the
Commencement Date to occur, Tenant hereby waiving and relinquishing any and all
other rights and remedies at law and in equity against Landlord for any such
failure (including, but not limited to, remedies for any consequential,
indirect, speculative or punitive damages suffered by Tenant).

 

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Section 2.06. Early Access. Subject to the terms of this Section 2.06, and to
all other applicable provisions of this Lease (including, without limitation,
Article 7 of this Lease), Landlord will permit Tenant and its agents to enter
the Leased Premises prior to the Commencement Date: (a) in order to perform
through its own contractors (to be first approved by Landlord) such other work
and decorations as Tenant may desire at the same time that the Landlord Work is
being performed in the Leased Premises (including, without limitation, the work
contemplated by Section 7.04(a) of this Lease, the installation of racking and
distribution-related equipment, and the installation of machinery and assembly
lines); and (b) if, and only if, Tenant is able to obtain a temporary
certificate of occupancy and any other necessary approvals from any applicable
governmental authorities permitting such activities within the Leased Premises
notwithstanding the fact that the Landlord’s Work will not then be complete, to
operate a distribution facility within the Leased Premises. Landlord will not
unreasonably withhold, condition or delay its approval of Tenant’s contractors.
If Landlord fails to respond to any request by Tenant for approval of any
contractors within five (5) business days after its receipt of such request,
Landlord shall be deemed to have disapproved such contractors. However, if
Landlord is deemed to have disapproved such contractors by reason of Landlord’s
failure to timely notify Tenant in writing of Landlord’s approval or
disapproval, Tenant may provide Landlord with written notice of such failure to
respond (the “Second Notice”), which, in order to be effective, must clearly,
conspicuously and in bold type face set forth the following statement at the top
of the first page of the Second Notice: “SECOND NOTICE! THE FAILURE OF LANDLORD
TO RESPOND WITHIN FIVE (5) BUSINESS DAYS AFTER THE RECEIPT OF THIS SECOND NOTICE
BY LANDLORD SHALL BE DEEMED TO BE APPROVAL OF THE PROPOSED CONTRACTORS.” If
Landlord should fail to notify Tenant in writing of its election as to such
proposed alterations within five (5) business days after receipt of such Second
Notice, Landlord shall be deemed to have approved the applicable contractors.
The foregoing license to enter and conduct such activities prior to the
Commencement Date, however, is conditioned upon Tenant’s workmen and contractors
working in harmony with and not interfering with the labor employed by
“Contractor” (as defined in the Work Letter), Landlord, Landlord’s mechanics or
contractors or by any other tenant(s) or their contractors, and not impeding or
interfering with Landlord’s Work, or the progress thereof. Such access shall at
all times be subject to the control and reasonable restrictions of Landlord. If
Landlord determines that any such interference, conflict or delay has been or
may be caused, and if Tenant fails to cease such interference, conflict or delay
within two (2) business days after notice to Tenant (which notice may be given
by telephone to _____________ or electronic mail to _____________), Landlord
shall have the right to withdraw permission to enter the Leased Premises upon
twenty-four (24) hours’ written notice to Tenant. Such entry shall be deemed to
be under all of the terms, covenants, provisions and conditions of this Lease.
However, Tenant agrees that any such entry into, and all activities conducted by
Tenant within, the Leased Premises shall be at Tenant’s own risk and Landlord
shall not be liable in any way for any injury, loss or damage which may occur to
Tenant, including, without limitation, to any of Tenant’s property or
installations made in the Leased Premises. Tenant further agrees to protect,
defend, indemnify and save harmless Landlord and its beneficiaries and agents
from all liabilities, costs, damages, fees and expenses arising out of or
connected with the activities of Tenant or Tenant’s contractors in or about the
Leased Premises or Building during the performance of Landlord’s Work,
including, without limitation, the cost of any repairs to the Leased Premises or
Building necessitated by the activities of Tenant’s contractors. In addition,
prior to the initial entry into the Building or the Leased Premises by Tenant
and by each of Tenant’s contractors, Tenant shall furnish Landlord, at Tenant’s
sole cost, with policies of insurance covering Landlord, its beneficiaries and
agents, as insured parties, with such coverages and in such amounts as Landlord
may then require in order to insure Landlord, its beneficiaries or agents
against loss or liability for injury or death or damage to property arising out
of or connected with any activities of Tenant or Tenant’s contractors. If
Tenant’s contractors or anyone employed by Tenant shall cause a delay in
completing Landlord’s Work (regardless of whether or not Tenant ceases such
delay within the time period set forth above), Tenant agrees that such delay
will constitute a Tenant Delay.

 

Section 2.07. Tenant Improvement Allowance.

 

(a) Landlord shall provide the “Tenant Improvement Allowance” to be applied to
“Tenant’s Construction Costs” (both as defined in the Work Letter) pursuant and
subject to the terms of the Work Letter.

 

(b) Subject to the terms of this Section 2.07(b), provided that there does not
exist a Default under this Lease, after application of the Tenant Improvement
Allowance to the Tenant’s Construction Costs in accordance with the Work Letter,
Tenant may, by written notice to Landlord (the “Election Notice”), elect to
apply any unused portion of the Tenant Improvement Allowance to “FF&E Costs” (as
hereinafter defined) pursuant and subject to the terms of Section 2.07(b)(i)
below, to costs incurred by Tenant to perform the installation work contemplated
by Section 7.04(a) of this Lease (the “Pit Installation Work”) pursuant and
subject to the terms of Section 2.07(b)(ii) below, and/or to amounts that Tenant
is required to reimburse to Landlord under Article 21 of this Lease pursuant and
subject to the terms of Section 2.07(b)(iii) below.

 

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(i) As used herein, the term “FF&E Costs” means the actual, out-of-pocket
expenses incurred by Tenant to purchase and install in the Leased Premises
furniture, fixtures, and equipment (including, without limitation, racking,
distribution-related equipment, machinery, and assembly line equipment).
However, in no event shall FF&E Costs include any costs incurred by Tenant to
perform the Pit Installation Work (Tenant may apply unused portion of the Tenant
Improvement Allowance to costs incurred by Tenant to perform the Pit
Installation Work pursuant and subject to Section 2.07(b)(ii) below, but such
costs shall not be deemed to be FF&E Costs). If Tenant elects to apply any
unused portion of the Tenant Improvement Allowance to FF&E Costs, Tenant shall
specify the portion of the Tenant Improvement Allowance to be so applied in the
Election Notice, and the Election Notice must be accompanied by invoices from
Tenant evidencing expenditure of such sums by Tenant. To the extent that any of
the FF&E Costs pertain to work which could create lien rights in favor of third
parties as to any portion of the Leased Premises or Building (as opposed to any
of Tenant’s personal property), the Election Notice must also be accompanied
lien waivers and other documents in form and substance reasonably satisfactory
to Landlord which are sufficient under the laws of the State of Georgia to
extinguish all such lien rights. Landlord shall reimburse Tenant for such
actual, out-of-pocket expenses promptly upon receipt of the Election Notice and
such materials.

 

(ii) If Tenant elects to apply any unused portion of the Tenant Improvement
Allowance to costs incurred by Tenant to perform the Pit Installation Work,
Tenant shall submit to Landlord a written report, certified by Tenant (the
“Reimbursement Request”), setting forth: (A) a computation of the total costs
incurred by Tenant for such work; and (B) the amount payable by Landlord to
Tenant, which amount shall not exceed the then-remaining unused portion of the
Tenant Improvement Allowance. The Reimbursement Request shall be accompanied, to
the extent applicable to the costs set forth on the Reimbursement Request, by:
(1) an AIA Completion Certificate executed by Tenant’s contractor, and an AIA
Document G702 form executed by Tenant’s architect, both in form and substance
reasonably satisfactory to Landlord; (2) if, under applicable Laws, the
performance of such work requires issuance of a new certificate of occupancy for
the Leased Premises, a copy of the final certificate of occupancy for the Leased
Premises; (3) an affidavit or certificate executed by the Tenant’s architect
that all work is complete and is in accordance with the plans approved by
Landlord and all Laws; (4) a Final Contractor’s Affidavit from Tenant’s
contractor meeting the requirements of the laws of the State of Georgia to
extinguish all lien rights in connection with such work; and (5) final lien
waivers from Tenant’s architect and contractor, and all subcontractors,
materialmen, and engineers. In addition, the Reimbursement Request shall be
accompanied by a set of scaled and dimensioned, “as built” plans for the work,
certified by Tenant’s architect, prepared on an Auto CAD Computer Assisted
Drafting and Design System (or such other system as Landlord may accept), using
naming conventions issued by the American Institute of Architects (or such other
naming conventions as Landlord may accept), and a CD of such as built plans
translated in DXF format (or any other format acceptable to Landlord). The
Reimbursement Request and all other items described above must be in form and
substance satisfactory to Landlord. Upon receipt of the Reimbursement Report and
all other required materials, Landlord shall reimburse Tenant the amount due
from Landlord under this Section 2.07(b)(ii) within thirty (30) days after
Landlord’s receipt thereof. However, Landlord shall not be obligated to disburse
the amount requested by Tenant until Tenant delivers to Landlord the
Reimbursement Report accompanied by all required items listed above. The
Reimbursement Report shall be subject to verification by Landlord (who shall
have access to Tenant’s books and records in respect thereof for such purpose)
and correction, if necessary, without either party being prejudiced by any
payments made hereunder. For the avoidance of doubt, Tenant acknowledges that it
must submit the Reimbursement Report, together with all documentation and
materials set forth above, within thirty (30) days after the Pit Installation
Work is substantially complete under all circumstances, and regardless of
whether or not any portion of the Tenant Improvement Allowance remains available
to be applied as set forth in this Section 2.07(b)(ii).

 

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(iii) If Tenant is required to reimburse any amounts to Landlord under Article
21 of this Lease, and if the total reimbursement obligation of Tenant under
Article 21 exceeds $10,000.00, then Tenant may elect to apply any unused portion
of the Tenant Improvement Allowance to the portion of such amount owed by Tenant
in excess of $10,000.00 by specifying the amount to be so applied in the
Election Notice.

 

(c) Notwithstanding anything contained in this Lease (including, without
limitation, the Work Letter) to the contrary, if Tenant has not satisfied the
conditions set forth above for disbursement of the entire Tenant Improvement
Allowance on or before the date that is nine (9) months after the Effective Date
(the “Allowance Expiration Date”), Tenant shall have no further rights to any
undisbursed portion of the Tenant Improvement Allowance. Any portion of the
Tenant Improvement Allowance remaining undisbursed after such date shall belong
to Landlord.

  

ARTICLE 3 - RENT

 

Section 3.01. Rent. Subject to the Rental Concession, Tenant shall pay to
Landlord in U.S. dollars the Minimum Annual Rent in monthly installments of the
Monthly Rental Installments set forth in Section 1.01(d) above, in advance,
without demand, abatement, counterclaim, recoupment, deduction or offset (except
as may be expressly set forth herein), beginning on the Commencement Date and on
or before the first day of each and every calendar month thereafter during the
Lease Term. The Monthly Rental Installments for partial calendar months shall be
prorated on the basis of the total number of days in the applicable calendar
month. All Rent and other payments to be made by Tenant to Landlord under this
Lease shall be made by Swift as follows:

 

PNK S2, LLC

IBAN: CH02 0020 6206 4922 0360 L

BANK: UBS AG

ZURICH, SWISS

SWIFT: UBSWCHZH80A

 

or by such other method or to such other location as may be specified by
Landlord to Tenant in writing, in accordance with this Section 3.01.
Additionally, if applicable, Tenant shall pay to Landlord any and all sales,
use, occupancy or similar taxes which may be levied or imposed upon any Rent
payable by Tenant under this Lease, with the payment of each such tax and surtax
due and payable at the same time as payment of the underlying amount is due and
payable hereunder.

 

Section 3.02. Annual Rental Adjustment Definitions.

 

(a) “Annual Rental Adjustment”: the amount of Tenant’s Proportionate Share of
Operating Expenses for a particular calendar year.

 

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(b) “Operating Expenses”: the amount of all of Landlord’s costs and expenses
paid or incurred in owning, managing, operating, repairing, replacing and
maintaining the Building Project in good condition and repair for a particular
calendar year, determined in accordance with generally accepted real estate
accounting practices consistently applied, including by way of illustration and
not limitation, the following: all Real Estate Taxes (as defined in Section
3.02(d) below), insurance premiums and deductibles; water, sewer, electrical and
other utility charges other than the separately billed electrical and other
utility charges paid by Tenant pursuant to this Lease (or paid by other tenants
in the Building); painting; stormwater discharge fees; tools and supplies;
repair costs; landscape maintenance costs; access patrols; license, permit and
inspection fees; management fees (not to exceed two percent (2%) of the gross
revenues for the Building Project with respect to the applicable period);
supplies, costs, salaries, wages and related employee benefits and bonuses for
all employees at or below the grade of property manager (regardless of the title
of such employees), payable for the management, maintenance and operation of the
Building Project (to the extent that persons are engaged with respect to the
Building Project and other properties, wages and salaries relating to such
persons shall be equitably apportioned between all such properties based upon
Landlord’s reasonable estimate of the time spent by each such person on each
property relative to their total time on all properties); maintenance, repair
and replacement of the driveways, parking areas, curbs and sidewalk areas
(including snow and ice removal), landscaped areas, drainage strips, sewer
lines, exterior walls, foundation, structural frame, roof, gutters and lighting,
subject to any obligation that Landlord may have to amortize such costs if they
are deemed to be capital costs, as set forth below; payments under any easement,
license, operating agreement, declaration, restrictive covenant or instrument
pertaining to the sharing of costs by the Building Project (including, without
limitation, any fees, costs or assessments imposed by any property owners
association); the costs of any capital improvements made in or to the Building
Project in order to comply with changes in any applicable Laws, ordinances,
rules, regulations or orders of any governmental or quasi-governmental authority
having jurisdiction over the Building Project (referred to herein as “Required
Capital Improvements”), as well as the costs of any capital improvements
intended to reduce Operating Expenses (referred to herein as “Cost Savings
Improvements”), provided that the expenditures for Required Capital Improvements
and Cost Savings Improvements shall be amortized over the expected useful life
of such capital improvement (as reasonably determined by Landlord, without
regard to the period over which such improvements may be depreciated or
amortized for federal income tax purposes) and only the amortized portion of
such costs for each applicable year shall be included in Operating Expenses for
such year, and provided further that the amortized amount of any Cost Savings
Improvement shall be limited in any year to the actual, or if not reasonably
obtainable, the reasonably estimated, reduction in Operating Expenses resulting
from the Cost Savings Improvement during the same calendar year; and any
expenses relating generally to the Park which are allocated to the Building
Project, including, without limitation, any allocation of expenses attributable
to the repair and maintenance of the Common Areas of the Park. The following
shall be excluded from Operating Expenses: (i) expenses for capital improvements
made to the Building Project, other than (A) capital improvements that are
expressly included in Operating Expenses as set forth above; and (B) items
which, though capital for accounting purposes, are properly considered
maintenance and repair items, such as, without limitation, painting of Common
Areas [expenses for capital improvements of the type referenced in (A) and (B)
of this clause (i) may be included in Operating Expenses]; (ii) expenses for
repair, replacement, and general maintenance paid by proceeds of insurance (or
which would have been paid by insurance proceeds if Landlord had maintained the
insurance required to be maintained by Landlord under this Lease), or by Tenant
or other third parties (except by payment of a pro rata share of Operating
Expenses, or like reimbursement method); (iii) expenses for repairs or
maintenance which are covered by warranties and service contracts, but only to
the extent such maintenance and repairs are made at no cost to Landlord; (iv)
costs for reserves of any kind; (v) costs and expenses attributable to the
correction of any construction defects in the initial construction of the
Building or the Leased Premises; (vi) expenses resulting from the negligence or
willful misconduct of Landlord, its agents, contractors or employees; (vii) any
fines, penalties or interest resulting from Landlord’s failure to pay Real
Estate Taxes as and when due; (viii) principal and/or interest payments on, or
closing costs relating to, any financing for the Building Project, or in respect
of any debt of Landlord; (ix) deductions for depreciation or amortization
(except as expressly included in Operating Expenses above); (x) net basic rental
under any ground or underlying lease; (xi) costs attributable to obtaining or
retaining tenants, including, without limitation, advertising expenses,
improvement costs, costs of permits, licenses and inspections, brokerage
commissions, moving expenses, architectural fees attorneys’ fees and costs,
disbursements and other expenses incurred in negotiating, preparing or executing
leases or other occupancy agreements, or modifications, amendments or
terminations thereof; (xii) costs (including, without limitation, legal costs),
expenses and damages of any kind arising out of or in connection with resolving
disputes with other tenants or occupants; (xiii) costs associated with the
operation of the business of the entity which constitutes “Landlord” (as
distinguished from costs relating to owning, managing, operating, repairing,
replacing and maintaining the Building Project), including, but not limited to,
Landlord’s or Landlord’s managing agent’s general corporate overhead and general
administrative expenses; (xiv) payments 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 Project or any portion thereof,
or for supplies or other materials, to the extent the cost of such services,
supplies, or materials exceed the cost that would have been paid had the
services, supplies or materials been provided by parties unaffiliated with the
Landlord on a competitive basis; (xv) charitable and political contributions of
Landlord; (xvi) costs of renovating or otherwise improving, painting,
decorating, or redecorating leasable space for tenants or other occupants,
except in connection with general maintenance of the Building Project; (xvii)
costs, penalties or fines arising from Landlord’s violation of any laws, except
to the extent such costs reflect costs that would have been incurred by Landlord
absent such violation; (xviii) the cost of any large-scale abatement of
“Hazardous Substances” (as hereinafter defined), provided, however, Operating
Expenses may include the costs attributable to those actions taken by Landlord
in connection with the ordinary operation and maintenance of the Building
Project, including, without limitation, costs incurred in removing limited
amounts of Hazardous Materials from the Building Project when such removal is
directly related to such ordinary maintenance and operation; (xix) expenses
incurred in connection with services or other benefits of a type which are not
made available to Tenant but which are provided to other tenants or occupants;
(xx) costs associated with the acquisition of (as contrasted with the
maintenance of) sculpture, paintings or other objects of art; (xxi) costs of
selling, syndicating, financing, mortgaging or hypothecating any of Landlord’s
interest in the Building; (xxii) unless any income generated from such
concessions is used to reduce Operating Expenses, costs of installing, operating
and maintaining any specialty service such as a dining club, cafeteria, health
club, observatory, broadcasting facility, retail store, sundry shop, or
newsstand, but Operating Expenses may include the costs of operating and
maintaining any gym or fitness center for the general use of tenants in the Park
(including Tenant); (xxiii) costs of “tap fees” and sewer and water connection
fees for the exclusive benefit of any particular tenant in the Building or the
Park; (xxiv) costs of traffic studies, transportation system management plans
and reports, traffic mitigation measures and other similar matters; (xxv)
expenses incurred for the repair, maintenance or operation of any parking
facilities that do not provide parking for the Building (including, without
limitation, expenses for salaries and benefits of attendants, utility costs, and
insurance if relating only to such facilities); and (xxvi) costs and expenses
due to the termination or under-funding of any plan under ERISA or any other
Laws governing employee pension plans or other benefits. For purposes of
determining the Annual Rental Adjustment for any year, if the Building is not
fully rented during all or a portion of any year, Landlord may make appropriate
adjustments to the Operating Expenses which vary based upon occupancy for such
year employing sound accounting and management principles consistently applied,
to determine the amount of Operating Expenses that would have been paid or
incurred by Landlord had the Building been one hundred percent (100%) occupied,
and the amount so determined shall be deemed to have been the amount of
Operating Expenses for such year. In addition, in the event any other tenant in
the Building provides itself with a service which Landlord would supply under
this Lease without an additional or separate charge to Tenant, then Operating
Expenses shall be deemed to include the cost Landlord would have incurred had
Landlord provided such service to such other tenant.

  

9

 

 

(c) “Tenant’s Proportionate Share of Operating Expenses”: an amount equal to the
product obtained by multiplying Tenant’s Proportionate Share by the Operating
Expenses for the applicable calendar year.

 

(d) “Real Estate Taxes”: subject to Article 21 of this Lease, any form of real
estate tax or assessment or service payments in lieu thereof (as the same may be
reduced by any applicable tax abatement, reduction, refund, or rebate) or water
or sewer tax or charges, any special assessments due to deed restrictions and/or
owners’ associations, of every kind or nature, whether general, special,
ordinary or extraordinary, and any license fee, commercial rental tax,
improvement bond, charges in connection with an improvement district or other
similar charge or tax (other than inheritance, personal income, franchise,
transfer, capital stock, or estate taxes) imposed upon the Building or Common
Areas, or against Landlord’s business of leasing the Building, by any authority
having the power to so charge or tax, together with costs and expenses of
contesting the validity or amount of the Real Estate Taxes. In addition, if
there is levied on Landlord a capital tax directly on the rents received by
Landlord, or a franchise tax, assessment, or charge based, in whole or in part,
upon such rents for the Project, then all such taxes, assessments or charges, or
the part thereof so based, shall be deemed to be included within the term “Real
Estate Taxes” for the purposes hereof.

 

Section 3.03. Payment of Additional Rent.

 

(a) Any amount required to be paid by Tenant hereunder (other than Minimum
Annual Rent) and any charges or expenses incurred by Landlord on behalf of
Tenant under the terms of this Lease shall be considered “Additional Rent”
payable in the same manner and upon the same terms and conditions as the Minimum
Annual Rent reserved hereunder, except as set forth herein to the contrary.
Minimum Annual Rent and Additional Rent are sometimes referred to herein,
collectively, as “Rent.”

 

(b) In addition to the Minimum Annual Rent specified in this Lease, commencing
as of the Commencement Date, Tenant shall pay to Landlord as Additional Rent for
the Leased Premises, in each calendar year or partial calendar year during the
Lease Term, an amount equal to the Annual Rental Adjustment for such calendar
year or partial calendar year, as the case may be. For the first calendar year
of the Lease Term, or any portion thereof, Landlord shall provide Tenant with a
written statement in reasonable detail, sufficient for Tenant verification, of
the component breakdown of the estimated Operating Expenses for such first
calendar year (or portion thereof), including Tenant’s Proportionate Share of
Operating Expenses for such period of time. Such estimate shall be based on
actual Operating Expenses incurred in the Building and the Park, if any, during
the immediately preceding calendar year. Thereafter, Landlord shall estimate the
Annual Rental Adjustment annually, and written notice thereof shall be given to
Tenant prior to the beginning of each calendar year, or as soon thereafter as is
reasonably practicable. If Landlord furnishes an Annual Rental Adjustment
estimate for any year subsequent to the commencement thereof, then: (i) until
the 1st day of the month following the month in which the Annual Rental
Adjustment estimate for such year is furnished to Tenant, Tenant shall pay to
Landlord, on the first (1st) day of each calendar month, an amount equal to the
monthly estimated Annual Rental Adjustment for the immediately preceding year;
(ii) promptly after the Annual Rental Adjustment estimate for such year is
furnished to Tenant, or together therewith, Landlord shall give notice to Tenant
stating whether the installments of the Annual Rental Adjustment previously made
for the then-current year were greater or less than the installments of Annual
Rental Adjustment to be made for such year in accordance with the estimate for
such year, and: (A) if there shall be a deficiency, Tenant shall pay the amount
thereof within ten (10) business days after demand therefor; or (B) if there
shall have been an overpayment, Landlord shall credit the amount thereof against
subsequent payments of Rent due hereunder; and (iii) on the 1st day of the month
following the month in which the Annual Rental Adjustment estimate for such year
is furnished to Tenant, and on the first (1st) day of each month thereafter
throughout the remainder of such year, Tenant shall pay to Landlord an amount
equal to one-twelfth (1/12th) of the Annual Rental Adjustment estimate for such
year. Tenant shall pay to Landlord each month, at the same time the Monthly
Rental Installment is due, an amount equal to one-twelfth (1/12) of the
estimated Annual Rental Adjustment. Tenant shall be responsible for delivering
the Additional Rent to the payment address set forth in Section 3.01 above in
accordance with this Section 3.03. If Operating Expenses increase during a
calendar year, Landlord may increase the estimated Annual Rental Adjustment
during such calendar year (but no more than once each calendar year) by giving
Tenant written notice to that effect, and thereafter Tenant shall pay to
Landlord, in each of the remaining months of such calendar year, an amount equal
to the amount of such increase in the estimated Annual Rental Adjustment divided
by the number of months remaining in such calendar year. Within ninety (90) days
after the end of each calendar year, Landlord shall prepare and deliver to
Tenant a statement showing the actual Annual Rental Adjustment for such calendar
year; provided, however, that Landlord shall be entitled, if circumstances
warrant, to issue one or more revised, corrected, or supplemental statements at
any time and from time to time following the issuance of the initial statement.
If the estimated Annual Rental Adjustment payments made by Tenant are less than
the actual Annual Rental Adjustment, then Tenant shall pay to Landlord the
difference between the actual Annual Rental Adjustment for the preceding
calendar year and the estimated payments made by Tenant during such calendar
year within thirty (30) days after receipt of the aforementioned statement. In
the event that the estimated Annual Rental Adjustment payments made by Tenant
are greater than the actual Annual Rental Adjustment, then Landlord shall credit
the amount of such overpayment toward the next Monthly Rental Installment(s) and
the next monthly estimated Annual Rental Adjustment payment(s) due under this
Lease until such overpayment is recovered by Tenant in full (or remit such
amount to Tenant in the event that this Lease shall have expired or terminated).
This Section 3.03 shall survive the expiration or any earlier termination of
this Lease.

 

10

 

 

(c) For the purpose of calculating the Annual Rental Adjustment, “Controllable
Operating Expenses” (as hereinafter defined) for calendar year 2022, and each
year thereafter, shall not increase by more than four percent (4%) per annum, on
a compounded and cumulative basis, over the actual amount of such “Controllable
Operating Expenses” for calendar year 2021. As used herein, the term
“Controllable Operating Expenses” means all Operating Expenses, on a per square
foot of Rentable Area basis (as “grossed up” pursuant to Section 3.02(b) of this
Lease), other than taxes, insurance, utilities, costs of snow removal or storm
cleanup, costs subject to government regulation, such as minimum wages, and all
costs incurred to comply with new or revised federal or state laws, municipal or
county ordinances or codes or regulations promulgated under any of the same. By
way of illustration of the foregoing, in calendar year 2023, the Controllable
Operating Expenses shall not exceed the amount determined by the following
formula, when “X” equals the actual amount of the Controllable Operating
Expenses for calendar year 2021:

 

X times 1.04 times 1.04 = maximum amount of Controllable Operating Expenses for
calendar year 2023.

 

Thus, if Controllable Operating Expenses for 2021 are $0.50 per square foot of
Rentable Area on a “grossed up” basis, the maximum amount of Controllable
Operating Expenses for calendar year 2023 would be $0.50 x 1.04 x 1.04 = $0.54
per square foot of Rentable Area.

 

(d) Within ninety (90) days after Tenant’s receipt of a statement of actual
Operating Expenses for the preceding year (the “Actual Operating Expenses
Statement”), Tenant shall have the right, by written request to Landlord, to
request a detailed breakdown of Operating Expenses for the preceding year, which
shall, in reasonable detail, demonstrate the calculation of actual Operating
Expenses for the preceding year and of the amount by which Tenant’s
Proportionate Share of Operating Expenses exceeds or is less than the amounts
paid by Tenant during such year. Following receipt of such detailed breakdown,
Tenant may request, and Landlord shall provide (to the extent in Landlord’s
possession), such supporting documentation of individual line-item components of
the actual Operating Expenses as Tenant may reasonably request. In addition,
within ninety (90) days after Tenant receives the Actual Operating Expenses
Statement for any particular year, and provided that there does not then exist a
Default hereunder, Tenant may contest such annual Actual Operating Expenses
Statement by providing written notice to Landlord, delivered within such ninety
(90) day period. If no such contest is made by written notice to Landlord,
delivered within such 90-day period, such annual Actual Operating Expenses
Statement shall be binding upon Tenant in all respects. If Tenant timely
contests such annual Actual Operating Expenses Statement, Tenant shall have the
right to inspect and examine, at reasonable times during normal business hours,
Landlord’s books of account and records pertaining to the annual Actual
Operating Expenses Statement. Such audit shall be conducted at the offices of
Landlord’s property manager where such records are kept, or in such other
location in the United States where such records are then being kept, within
forty-five (45) days after the date of Tenant’s notice, and shall not be
conducted at a time or in a manner so as to interfere with Landlord’s
operations. Such audit shall be conducted by a certified public accountant
retained by Tenant, at its expense, whose compensation is not contingent upon
the results of such accountant’s audit or the amount of any refund received by
Tenant. Landlord agrees that if Tenant requests evidence or back-up information
regarding a specific question (or questions), which Tenant has regarding
Operating Expenses or Real Estate Taxes, then Landlord (or Landlord’s property
manager) shall make copies thereof available to Tenant. Landlord and/or
Landlord’s property manager shall cooperate with Tenant and/or Tenant’s
representatives with respect to any such specific inquiries or questions and
with respect to the conduct of such audit, so as to facilitate the prompt and
efficient answer thereto and/or conduct of same, as applicable. Tenant shall
notify Landlord of the results of such audit in writing. Landlord may have an
agent or employee present during such inspection and audit. Landlord shall have
the right to dispute the results of Tenant’s audit. If the audit by Tenant shall
ultimately result in Landlord and Tenant agreeing that Tenant has overpaid
Landlord for the Annual Rental Adjustment for the applicable year, such
overpayment shall be applied to the next accruing installment(s) of Rent due
from Tenant until such credit is depleted. If Landlord and Tenant agree that
Tenant has overpaid Landlord for the Annual Rental Adjustment for the applicable
year and such overpayment is more than five percent (5%) in excess of the actual
amount due as Annual Rental Adjustment, then Landlord shall pay the reasonable
out-of-pocket costs and expenses of Tenant in conducting such audit, not to
exceed $2,500.00. Otherwise, Tenant shall pay the cost of such audit. Tenant
hereby agrees to keep the results of any such audit confidential, and to require
Tenant’s auditor and its employees and each of their respective attorneys and
advisors to likewise agree to keep the results of such audit in strictest
confidence. In particular, but without limitation, Tenant agrees that: (i)
Tenant shall not disclose the results of any such audit to any past, current or
prospective tenant of the Building; and (ii) Tenant shall require that its
auditors, attorneys, and anyone associated with such parties shall not disclose
the results of such audit to any past, current or prospective tenant of Landlord
in the Building; provided, however, that Landlord hereby agrees that nothing in
items (i) or (ii) above shall preclude Tenant from disclosing the results of
such audit in any judicial or quasi-judicial proceeding, or pursuant to court
order or discovery request, or to any current or prospective assignee or
subtenant of Tenant, or to any agent, representative or employee of Landlord who
or which request the same. No subtenant shall have any right to conduct an audit
and no assignee shall conduct an audit for any period during which such assignee
was not in possession of the Leased Premises. The parties acknowledge that terms
of this Section 3.03(d) shall also apply to the Actual Operating Expenses
Statement pertaining to the final calendar year (or portion thereof) of the
Lease Term, notwithstanding the fact that such Actual Operating Expenses
Statement will be provided to Tenant after the end of the Lease Term.

 

Section 3.04. Late Charges. Tenant acknowledges that Landlord shall incur
certain additional unanticipated administrative and legal costs and expenses if
Tenant fails to pay timely any payment required hereunder. Therefore, in
addition to the other remedies available to Landlord hereunder, if any payment
required to be paid by Tenant to Landlord hereunder shall become overdue, such
unpaid amount shall: (a) be subject to a late fee equal to the greater of (i)
five percent (5%) of the amount past due, or (ii) $50.00, which late fee
represents an agreed upon charge for the administrative expense suffered by
Landlord as a result of such late payment and not payment for the use of money
or a penalty; and (b) bear interest from the due date thereof to the date of
payment at the prime rate of interest, as reported in the Wall Street Journal
(the “Prime Rate”) plus six percent (6%) per annum; provided, however, such
interest rate shall not be less than twelve percent (12%) per annum.

 

11

 

 

Section 3.05. Rental Concession. Provided that there does not exist a Default
under this Lease, Tenant shall be entitled to a conditional abatement of the
Monthly Rental Installments which would otherwise be due with respect to the
first (1st) eight (8) full calendar months of the initial year of the Lease Term
(the “Rental Concession”) (although all such Monthly Rental Installments shall
continue to accrue for such period). Notwithstanding the Rental Concession,
Tenant shall be obligated to pay all other Rent (including, without limitation,
any amounts payable as the Annual Rental Adjustment) due under this Lease for
such period. Landlord and Tenant hereby acknowledge and agree that the Rental
Concession is a concession in an amount equal to $1,181,405.84 in total and, if
any Default occurs and continues beyond any applicable notice and cure periods
set forth in this Lease: (a) the Rental Concession shall be canceled, the
portion of the Rental Concession which has not been used by Tenant as of the
date of the occurrence of such Default shall automatically terminate and become
null and void, Tenant shall no longer be entitled to any rent concession or
abatement of rent described in this Section, and Tenant shall thereafter pay all
Monthly Rental Installments when due under this Lease, without regard to the
Rental Concession provisions of this Lease; and (b) the unamortized amount of
the portion of the Rental Concession which has been used by Tenant as of the
date of the occurrence of such Default shall become immediately due and payable.
For the purposes of clause (ii) of the preceding sentence, the unamortized
portion of the Rental Concession which is used by Tenant will be calculated as
if the portion of the Rental Concession used by Tenant is being amortized over
the “Rental Concession Amortization Period” (as defined below) in equal monthly
installments of principal and interest, together with interest at the rate of
twelve percent (12%) per annum (or the maximum rate permitted by applicable law,
whichever is less). The “Rental Concession Amortization Period” means the period
commencing on the first (1st) day of the ninth (9th) full calendar month of the
initial year of the Lease Term and continuing through the Expiration Date (based
on the foregoing, the Rental Concession Amortization Period will consist of one
hundred twenty (120) months). Notwithstanding anything contained herein to the
contrary, in no event shall the Rental Concession apply to or be deemed to
forgive or excuse payment of any “Additional Monthly Payments” (as defined in
the Work Letter).

 

ARTICLE 4 - SECURITY DEPOSIT

 

Tenant shall not be obligated to pay a security deposit to Landlord.

 

ARTICLE 5 - OCCUPANCY AND USE

 

Section 5.01. Use. Tenant shall use the Leased Premises for the Permitted Use
and for no other purpose without the prior written consent of Landlord.

 

Section 5.02. Covenants of Tenant Regarding Use.

 

(a) Tenant shall: (i) use and maintain the Leased Premises and conduct its
business thereon in a safe, careful, reputable and lawful manner; (ii) comply
with all covenants and restrictions that encumber the Building and with all
applicable laws, rules, regulations, orders, ordinances, codes, directions, and
requirements of any governmental authority or agency with jurisdiction over the
Building or the Park, now in force or which may hereafter be in force
(collectively, the “Laws”), including, without limitation, those Laws which
shall impose upon Landlord or Tenant any duty with respect to or triggered by a
change in the use or occupation of, or any improvement or alteration to, the
Leased Premises; and (iii) comply with and obey all reasonable directions,
rules, and regulations of Landlord, including the Building rules and regulations
attached hereto as Exhibit D and made a part hereof (the “Rules and
Regulations”), as such Rules and Regulations may be modified from time to time
by Landlord upon reasonable notice to Tenant. Notwithstanding any provision of
this paragraph or any other provision of the Rules and Regulations to the
contrary, Landlord hereby agrees that all such rules and regulations, and any
changes thereto, shall be non-discriminatory in substance to the tenants of the
Building. Landlord may, however, grant exceptions to the Rules and Regulations
for particular tenants in particular instances without being deemed to be in
violation of the immediately preceding sentence; provided, however, that: (A) if
Landlord permanently excuses any other tenant of the Building from complying
with any of the Rules and Regulations, then, until such time as such excuse
ends, Tenant shall also not be obligated to comply with the applicable Rules and
Regulations; and (B) Landlord shall not excuse any other tenant from complying
with any Rule and Regulation if Landlord reasonably believes that such excuse
will have a material adverse impact on Tenant’s use of the Leased Premises. In
the event of a conflict between the Rules and Regulations and the provisions of
this Lease, the provisions of this Lease shall govern and control.

 

12

 

 

(b) Tenant shall not do or permit anything to be done in or about the Leased
Premises that will in any way cause a nuisance, obstruct or interfere with the
rights of other tenants or occupants of the Building or injure or unreasonably
disturb them. Landlord shall not be responsible to Tenant for the
non-performance by any other tenant or occupant of the Building of any of the
Rules and Regulations, but shall generally use commercially reasonable efforts
to enforce the Rules and Regulations uniformly and consistently (provided,
however, that Landlord may, in its sole discretion, elect to grant exceptions to
one or more of the Rules and Regulations to a particular tenant or tenants, and
such election shall not be deemed to be a violation of Landlord’s obligations
under this Section 5.02(b)). Tenant shall not overload the floors of the Leased
Premises. All damage to the floor structure or foundation of the Building due to
improper positioning or storage of items or materials shall be repaired by
Landlord at the sole expense of Tenant, who shall reimburse Landlord immediately
therefor upon demand. Landlord reserves the right to reasonably designate the
position of all equipment which Tenant wishes to place within the Leased
Premises, and to place limitations on the weight thereof (however, Tenant shall
be permitted to place in the “pits” to be installed in the floor slab of the
Leased Premises pursuant to Section 7.04 of this Lease the machinery for which
such pits are intended, subject to all other applicable terms of this Lease).
Tenant shall not use the Leased Premises, nor allow the Leased Premises to be
used, for any purpose or in any manner that would (i) invalidate any policy of
insurance now or hereafter carried by Landlord on the Building, or (ii) increase
the rate of premiums payable on any such insurance policy unless Tenant
reimburses Landlord for any such increase in premiums charged. Notwithstanding
the foregoing, Tenant’s installation of the “pits” in the floor slab of the
Leased Premises pursuant to Section 7.04 of this Lease shall not, in and of
itself, be deemed to be a breach of this Section 5.02(b).

 

Section 5.03. Landlord’s Rights Regarding Use.

 

(a) In addition to Landlord’s rights specified elsewhere in this Lease, (i)
Landlord shall have the right at any time, without notice to Tenant, to control,
change or otherwise alter the Common Areas in such manner as it deems necessary
or proper, and (ii) Landlord, its agents, employees, representatives,
consultants, contractors, and the holders of any Mortgages (each such holder, a
“Mortgagee”), shall have the right (but not the obligation) to enter any part of
the Leased Premises at reasonable times, and to enter upon the Building and
Common Areas at any time without notice, for the purposes of examining or
inspecting the same (including, without limitation, testing to confirm Tenant’s
compliance with this Lease), showing the same to prospective purchasers,
Mortgagees or tenants, and making such repairs, alterations or improvements to
the Leased Premises or the Building as Landlord may deem necessary or desirable.
Landlord shall incur no liability to Tenant for such entry (subject to Section
8.03 of this Lease), nor shall such entry constitute an eviction of Tenant or a
termination of this Lease, or entitle Tenant to any abatement of rent therefor.

 

13

 

 

(b) So long as no uncured Default exists, Landlord shall provide Tenant with not
less than 24 hours’ notice by telephone or email to the on-site office manager
of Tenant (if Tenant has provided Landlord with the telephone number and email
address for such person) prior to entering the Leased Premises for any reason
other than for the provision of any routine services that Landlord is obligated
to provide under this Lease, for security inspections, in the case of
emergencies or to show the Leased Premises to prospective purchasers and
Mortgagees and, during the last nine (9) months of the Lease Term, prospective
tenants. Except in the case of emergencies, so long as no uncured Default
exists, Tenant shall have the right to have a representative of Tenant accompany
Landlord when Landlord enters the Leased Premises, provided that, so long as
Landlord provides Tenant with the notice required under this Lease, it is
Tenant’s obligation to make sure that it has a representative available at the
time of Landlord’s entry into the Leased Premises, and Tenant’s failure to have
a representative available at such time shall not preclude Landlord from
entering the Leased Premises. In addition, Tenant may designate one or more
reasonably-sized areas in the Leased Premises as secure areas (provided that
such secure areas shall not include areas containing mechanical, electrical,
plumbing, or life-safety equipment that serves areas outside of the Leased
Premises or the Building generally, to which Landlord shall have unrestricted
access), and, so long as Tenant shall have provided prior written notice to
Landlord of the same, and so long as no uncured Default exists, Landlord shall
have no access to such secure areas during the Lease Term, except in the case of
an emergency.

 

(c) So long as no uncured Default exists, except in the case of emergencies,
Landlord shall comply with any reasonable security procedures established by
Tenant for visitors to the Leased Premises which are communicated to Landlord,
provided that such security procedures shall in no event prevent or unduly delay
Landlord from exercising any right that it may have to enter into the Leased
Premises. In addition, Tenant shall be permitted to prohibit Landlord from
taking photographs of Tenant’s fixtures, equipment, and processes, except to the
extent that such photographs are reasonably necessary in connection with the
enforcement of this Lease by Landlord.

 

(d) All limitations and restrictions on Landlord’s access to the Leased Premises
set forth in above in this Section 5.03 shall not apply to access by members of
the police department, members of the fire department, first responders or other
law enforcement or emergency response personnel, and shall automatically
terminate upon the expiration or earlier termination of this Lease or of
Tenant’s right to possession of the Leased Premises.

 

(e) Notwithstanding anything contained in this Lease to the contrary, Landlord
shall have the right to close or restrict access to all or any portion of the
Park (including, without limitation, the Building or the Leased Premises, or
both) in the event of an emergency.

 

(f) Except in the event of an emergency, Tenant shall have the right to prohibit
third parties (excluding Landlord and its employees) from entering into the
Leased Premises unless such third parties execute and deliver to Tenant a
non-disclosure agreement on Tenant’s then-standard, commercially reasonable form
used by Tenant at all of its locations nationwide; provided, however, that: (i)
at any time that an uncured Default exists, such prohibition shall not apply to
any of Landlord’s agents, representatives, or contractors; (ii) if any
contractor or other party retained by Landlord to perform any of Landlord’s
obligations under this Lease refuses to sign such non-disclosure agreement,
then, notwithstanding anything contained in this Lease to the contrary, Landlord
shall be granted such additional time to perform its obligations as may be
necessary to find a party to perform the applicable obligation that is
acceptable to Landlord and that is willing to sign such non-disclosure
agreement; and (iii) in no event shall Tenant enforce such prohibition in any
manner that would be a violation of any applicable Laws.

 

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Section 5.04. Signage.

 

(a) Except as set forth in Section 5.04(b) below, Tenant shall not paint,
display, inscribe, maintain or affix any sign, placard, picture, advertisement,
name, notice, lettering or direction outside of the Leased Premises, or on or in
any part of the inside of the Leased Premises which can be seen from the outside
of the Leased Premises, without first receiving Landlord’s prior written
consent, which may be granted or withheld in Landlord’ sole and absolute
discretion. Any Tenant signage shall comply with Laws. Landlord reserves the
right to remove at Tenant’s expense all unapproved sign matter.

 

(b) Subject to the terms of this Section 5.04(b), so long as no Default exists,
Tenant shall have the right to: (i) install and maintain a sign on the façade of
the Building (the “Façade Sign”); and (ii) place its name and logo on one (1)
standard-size panel of the multi-tenant monument sign for the Building that
exists as of the date of this Lease (the “Existing Monument Sign”). The exterior
signs that Tenant is permitted to install and maintain under this Section
5.04(b) are sometimes herein referred to collectively as the “Exterior Signs”
(each, an “Exterior Sign”). Tenant shall be solely responsible for the cost of
the installation, design, manufacture, maintenance and removal of the Façade
Sign and Tenant’s name and logo for the Existing Monument Sign, and for
obtaining all government approvals and permits, if any, required in connection
with either such sign. The inability of Tenant to obtain approval and all
necessary permits from the appropriate governmental authorities shall not
constitute a default by Landlord under this Lease or entitle Tenant to cancel or
otherwise terminate this Lease. The location, size, method of installation,
design, color scheme and all other aspects of the Exterior Signs shall be
subject to Landlord’s prior written approval; provided, however, that the
general aesthetic design shown on Exhibit E attached hereto and by this
reference made a part hereof is hereby approved by Landlord for the Exterior
Signs. Upon expiration or earlier termination of this Lease, or at any earlier
date upon which a Default occurs, Tenant shall, at its sole cost and expense,
remove the Exterior Signs and repair any damage caused by the installation,
maintenance or removal thereof. Tenant acknowledges that its rights under this
Section 5.04(b) are non-exclusive. Without limiting the generality of the
foregoing, Landlord may grant other tenants or third parties rights to place
their names and/or logos on the Existing Monument Sign or to have signage on the
roof or other exterior portions of the Building or Park, or both. Landlord shall
have the right to install one or more additional monument signs outside the
Building for use by other tenants, and nothing contained in this Lease shall be
deemed to grant Tenant any rights with respect thereto. Any changes that Tenant
desires to make to any of its signage under this Section 5.04(b) (whether in
connection with an assignment of this Lease or otherwise) shall be subject to
the same Landlord approval requirements set forth above with respect to the
initial signage, and all costs thereof shall be borne by Tenant.

 

Section 5.05. Parking. Subject to the terms of this Lease (including, without
limitation, any Rules and Regulations pertaining thereto), Tenant shall be
entitled to the exclusive use of, and to permit its employees, agents,
representatives, contractors, and invitees to use, not more than four hundred
eighteen (418) striped parking spaces located in the portion of the Building’s
parking facilities shown on Exhibit F attached hereto and made a part hereof
(the “Parking Lot”). Tenant shall have the right to designate any of such
parking spaces in the Parking Lot as reserved spaces with advance written notice
to Landlord, and provided that Landlord shall have the right to approve the
aesthetic appearance of any signage in connection therewith. Tenant shall have
no right to use, and shall not use, and shall not allow its employees, agents,
representatives, contractors, or invitees to use, any parking areas of the Park
other than the Parking Lot. Without limiting the generality of the foregoing,
Tenant agrees that its employees will not park in any spaces designated visitor
parking. No vehicle may be repaired or serviced in any parking area and any
vehicle brought into any parking area by Tenant, or any of Tenant’s employees,
agents, representatives, contractors, customers, guests or invitees, and deemed
abandoned by Landlord will be towed and all costs thereof shall be borne by
Tenant. There shall be no parking permitted on any of the streets or roadways
located within the Park.

 

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ARTICLE 6 - UTILITIES AND OTHER BUILDING SERVICES

 

Section 6.01. Services to be Provided. Landlord shall furnish to Tenant, except
as noted below, the following utilities and other services:

 

(a) Sewer service to the Leased Premises;

 

(b) Trash dumpster services at a location to be determined by Landlord for
Tenant’s use in common with other Building occupants; and

 

(c) Repair and maintenance to the extent expressly specified elsewhere in this
Lease.

 

Landlord shall have no obligation to provide any services in addition to or
different from the services that Landlord is expressly obligated to provide
under this Section 6.01. However, if Tenant requests any such additional or
different services, and if Landlord elects to provide such services, Tenant
shall reimburse Landlord at rates reflecting Landlord’s actual cost to provide
such services, plus Landlord’s then-current standard administrative charge
therefor (which administrative charge shall be subject to change from time to
time).

 

Section 6.02. Payment for Utilities and Services. Except as expressly set forth
in Section 6.01 above, Tenant shall arrange, directly with the providers
thereof, for the provision of all utilities and other services to the Leased
Premises (including, but not limited to, gas, electricity, water, fuel, telecom,
and gas), and shall promptly pay all charges for utilities and other services
furnished to the Leased Premises by the applicable utility company or service
provider. Without limiting the generality of the foregoing, Tenant shall
furnish, at Tenant’s sole expense, regularly scheduled janitorial service for
the Leased Premises five (5) days per week, exclusive of holidays, in a manner
that is consistent with comparable buildings in the vicinity of the Building.
All utilities furnished to the Leased Premises shall be separately metered, and
Tenant shall contract directly with the applicable utility company for the
provision of such utility services, and all charges therefor will be invoiced to
and paid directly by Tenant. If Tenant does not pay any utility or service
charges in a timely manner, Landlord may (but shall not be obligated to do so)
pay and collect said charges from Tenant as Additional Rent. Tenant shall not
conduct any operation or install any equipment which may exceed or overburden
the capacity of any utility facilities serving the Leased Premises. However, to
the extent that the Approved Construction Drawings specifically call for the
installation of electrical or other utility infrastructure as part of the
initial Landlord’s Work, Landlord acknowledges that use of such infrastructure
to its capacity (but not beyond such capacity) will not be deemed to overburden
the capacity of such infrastructure. Should any of Tenant’s operations or
equipment require additional utility facilities, and if Landlord consents to the
installation thereof, Tenant may install such facilities at Tenant’s expense
pursuant and subject to the terms of Section 7.03 of this Lease, provided that
such installations and facilities comply with all requirements of the insurance
underwriters and any governmental authority having jurisdiction there over.
Tenant acknowledges that Tenant will have the ability to control the HVAC
equipment serving the Leased Premises through the use of one or more thermostats
within the Leased Premises.

 

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Section 6.03. Interruption of Services. Landlord does not represent or warrant
that any of the services referred to above will be free from interruption and
Tenant acknowledges that any one or more of such services may be suspended by
reason of accident, repairs, inspections, alterations or improvements necessary
to be made, or by strikes or lockouts, or by reason of operation of law, or
causes beyond the reasonable control of Landlord. The rental herein reserved
shall not be abated by reason of any interruption, reduction or discontinuance
of service (except as expressly set forth below in this Section 6.03), nor will
any such event or occurrence be deemed an eviction or disturbance of Tenant’s
use and possession of the Leased Premises, or any part thereof, by Landlord,
nor, except as may otherwise be expressly set forth herein, will any such event
or occurrence render Landlord liable to Tenant for damages or relieve Tenant
from performance of Tenant’s obligations under this Lease. Furthermore, Landlord
shall be entitled to cooperate voluntarily in a reasonable manner with the
efforts of national, state or local governmental agencies or utilities suppliers
in reducing consumption of energy, water or any other resources, so long as the
operation of Tenant’s business in and from the Leased Premises is not
materially, adversely affected thereby. In the event of any failure to furnish,
or any stoppage of, any of the “Critical Services” (as hereinafter defined) for
a period in excess of five (5) consecutive business days, and if: (a) such
interruption is restricted to the Building and is not a neighborhood blackout;
(b) such failure to furnish or stoppage is caused by the sole negligence or
willful misconduct of Landlord or by the failure of Landlord to commence and
diligently pursue repairs for which Landlord is responsible under this Lease;
(c) such interruption results in the Leased Premises becoming untenantable; and
(d) Tenant actually ceases to occupy the Leased Premises as a result thereof,
Tenant shall be entitled to an abatement of Minimum Annual Rent and the Annual
Rental Adjustment which shall commence on the sixth (6th) business day (and
shall not be retroactive) and shall continue for the remainder of the period of
such failure to furnish or stoppage of such specified services. As used in this
Section 6.03, the “Critical Services” are: electricity, HVAC, and water service.
If any Critical Services are interrupted, to the extent that Landlord is
responsible for remedying the conditions that caused such interruption under the
terms of this Lease, Landlord shall use commercially reasonable efforts to
remedy such conditions as soon as reasonably practicable after notice from
Tenant.

 

ARTICLE 7 - REPAIRS, MAINTENANCE AND ALTERATIONS

 

Section 7.01. Repair and Maintenance of Building. As used herein: (a) the term
“Building Systems” means the mechanical, electrical, plumbing (including water,
sanitary sewer, and storm sewer), sprinkler, security, life-safety, and other
service systems or facilities of the Building (including pipes, wires, conduits,
and utility lines), including portions thereof located outside of the Building,
up to the point of connection of localized distribution to the Leased Premises
(excluding, however, supplemental or other systems exclusively serving the
Leased Premises, as well as sprinklers and the horizontal distribution systems
within and servicing the Leased Premises and by which mechanical, electrical,
plumbing, sanitary, heating, ventilating and air conditioning, security,
life-safety and other service systems are distributed from the Building feeders,
panelboards, etc. for provision of such services to the Leased Premises); and
(b) the term “Branch Systems” means mechanical, electrical, plumbing, sanitary,
sprinkler, HVAC, security, life safety and other service systems and facilities
serving only the Leased Premises (and not any other tenant’s premises), up to
the point of connection with Building Systems. Landlord shall keep and maintain
in good condition and repair (including any necessary replacements) the Common
Areas located within the Building Project and the following portions of the
Building: the foundations, the exterior paint, the Building Systems, and the
structural systems of the base Building (both interior and exterior), including,
without limitation, the roof, roof membrane, roof drains, roof covering, load
bearing walls, columns, lintels, beams, footings, floor slabs, and masonry
walls. However, Landlord shall have no obligation to repair, maintain, or
replace any heating, ventilating and air conditioning (“HVAC”) systems. As used
in this Section 7.01, “exterior walls” shall exclude Building fronts, plate
glass, window cases, or window frames, doors or door frames, security grilles,
and similar enclosures. The cost of such repairs, replacements and maintenance
shall be included in Operating Expenses to the extent provided in Section 3.02;
provided however, that to the extent any such repairs, replacements or
maintenance are required because of the negligence, misuse or default of Tenant,
its employees, agents, contractors, customers, or invitees, Landlord shall make
such repairs at Tenant’s sole expense.

 

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Section 7.02. Repair and Maintenance of Leased Premises. Excepting only
Landlord’s obligations under Section 7.01 above, Tenant shall, at its own cost
and expense, maintain the Leased Premises in good condition, regularly servicing
and promptly making all repairs and replacements, and providing all maintenance,
thereto, including, without limitation, all HVAC systems and Branch Systems
serving the Leased Premises, all supplemental or other systems serving the
Leased Premises, and all plate glass, floors, windows, doors, dock doors, and
dock equipment. Tenant shall obtain and maintain continuously throughout the
Lease Term a preventive maintenance contract on the HVAC system with a licensed
HVAC contractor and shall provide Landlord with a copy thereof. The preventive
maintenance contract and such contractor shall be subject to Landlord’s prior
written approval, which shall not be unreasonably withheld, conditioned, or
delayed. If, for any reason, within five (5) business days after Tenant’s
request, Landlord fails to object to or approve such contract or contractor,
such contract and contractor shall be deemed disapproved by Landlord.
Furthermore, the preventive maintenance contract shall meet or exceed Landlord’s
standard maintenance criteria, and shall provide for the inspection and
maintenance of the HVAC system at least once per calendar quarter.

 

Section 7.03. Alterations.

 

(a) Tenant shall be entitled to make non-structural, cosmetic alterations to the
Leased Premises costing in the aggregate not in excess of $100,000.00 per
calendar year without Landlord’s consent, as long as such alterations: (i) do
not involve structural portions of the Leased Premises or Building; (ii) do not
involve Building systems (including, but not limited to, HVAC systems, life
safety systems, electrical and plumbing systems); (iii) do not involve excess
noise or fumes of any type; and (iv) are not visible from outside of the Leased
Premises (“Cosmetic Alterations”). Tenant shall provide not less than ten (10)
days’ prior written notice to Landlord of Tenant’s intention to perform any
Cosmetic Alterations, which notice shall include a reasonable description of the
nature of the Cosmetic Alterations to be performed and the plans and
specifications therefor, if any, a list of contractors and subcontractors to
perform the work (and certificates of insurance for each such party), the
anticipated time of commencement and the anticipated time of completion. Except
for Cosmetic Alterations, Tenant shall not permit alterations in or to the
Leased Premises unless and until Landlord has approved the plans therefor in
writing. Provided that the criteria set forth in clauses (i) through (iv) above
in this paragraph are met, Landlord will not unreasonably withhold, condition or
delay its approval. If Landlord fails to respond to any request by Tenant for
approval of any alterations within five (5) business days after its receipt of
such request, Landlord shall be deemed to have disapproved such alterations.
However, if Landlord is deemed to have disapproved such alterations by reason of
Landlord’s failure to timely notify Tenant in writing of Landlord’s approval or
disapproval, Tenant may provide Landlord with written notice of such failure to
respond (the “Second Notice”), which, in order to be effective, must clearly,
conspicuously and in bold type face set forth the following statement at the top
of the first page of the Second Notice: “SECOND NOTICE! THE FAILURE OF LANDLORD
TO RESPOND WITHIN FIVE (5) BUSINESS DAYS AFTER THE RECEIPT OF THIS SECOND NOTICE
BY LANDLORD SHALL BE DEEMED TO BE APPROVAL OF THE PROPOSED ALTERATIONS.” If
Landlord should fail to notify Tenant in writing of its election as to such
proposed alterations within five (5) business days after receipt of such Second
Notice, Landlord shall be deemed to have approved the applicable alterations. If
Tenant undertakes any alternations without Landlord’s consent that do, in fact,
require such consent, without limiting any other remedy available to Landlord,
Landlord shall have the right to cause Tenant to remove such alterations. Tenant
shall ensure that all alterations shall be made in accordance with all
applicable Laws, in a good and workmanlike manner and of a quality at least
equal to the quality of the original construction of the Building. In the event
that Tenant makes any alterations, prior to the commencement thereof, Tenant
shall provide Landlord with evidence that Tenant’s general contractor carries
commercial general liability insurance (including property damage coverage),
worker’s compensation insurance, and “Builder’s Risk” insurance in an amount
reasonably approved by Landlord covering the construction of such alterations,
and such other insurance as Landlord may reasonably require. In addition,
Landlord may, in its discretion, require Tenant to obtain lien, payment, and
performance bonds, or some alternate form of security reasonably satisfactory to
Landlord in an amount sufficient to ensure the lien-free completion of such
alterations and naming Landlord and any Mortgagee as co-obligees. No person
shall be entitled to any lien derived through or under Tenant for any labor or
material furnished to the Leased Premises, and nothing in this Lease shall be
construed to constitute Landlord’s consent to the creation of any lien. If any
lien is filed against the Leased Premises for work claimed to have been done for
or materials claimed to have been furnished to Tenant, Tenant shall cause such
lien to be discharged of record or bonded over within thirty (30) days after
filing. Tenant shall indemnify Landlord from all costs, losses, expenses and
attorneys’ fees in connection with any construction or alteration and any
related lien. Tenant, at its expense, shall, as and when required, promptly
obtain certificates of partial and final approval of such alterations required
under any Laws and shall furnish Landlord with copies thereof, together with
“as-built” plans and specifications for such alterations, using customary naming
conventions and other features provided for by the American Institute of
Architects (or such other naming conventions as Landlord may accept). The
parties acknowledge that: (A) the mere placement of Tenant’s machinery and other
movable trade fixtures within the Leased Premises, and any changes specifically
to such items, shall not be considered “alterations” for purposes of this
Section 7.03(a); and (B) the performance of Landlord’s Work shall be governed by
the Work Letter, not this Section 7.03(a).

 

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(b) Subject to Section 7.04 below, unless Tenant receives written approval from
Landlord, at the time Landlord approves such alterations, to surrender such
alterations with the Leased Premises (which Tenant may request at such time),
Landlord may, by written notice to Tenant, require Tenant, at Tenant’s expense,
to remove the Landlord’s Work and/or any alterations, and to repair any damage
to the Leased Premises and/or the Building caused by such removal. However,
notwithstanding the foregoing, Tenant shall not be required to remove any
customary general office installations (as opposed to alterations, leasehold
improvements or physical additions which are not standard office installations,
such as, without limitation, kitchens, pantries, raised computer floors,
computer rooms, data centers, safe deposit boxes, vaults, libraries or file
rooms requiring reinforcement of floors, floor slab penetrations, and other
alterations and/or leasehold improvements of a similar character, and as opposed
to alterations, leasehold improvements or physical additions which relate to
non-office uses).

 

Section 7.04. Pits.

 

(a) Tenant intends to create “pits” in the floor slab of the Leased Premises to
house Tenant’s equipment. Tenant shall be permitted to perform work related to
the installation of such pits pursuant and subject to the terms of Section 7.03
above, except that, notwithstanding anything contained in Section 7.03 above to
the contrary: (i) all plans and specifications for such work, as well as all
architects, engineers, and contractors engaged by Tenant in connection
therewith, shall be subject to Landlord’s approval in its sole and absolute
discretion; (ii) Landlord shall have the right to supervise and direct (or to
retain a third party to supervise and direct on Landlord’s behalf) all or any
portion of such work, and Tenant shall fully cooperate with Landlord in
connection therewith, including, without limitation, causing Tenant’s
architects, engineers, and contractors to comply with Landlord’s instructions
and directives; and (iii) Tenant shall reimburse Landlord for all reasonable
costs actually incurred by Landlord in connection with such work. In addition,
Landlord may, in its discretion, require Tenant to obtain lien, payment, and
performance bonds, or some alternate form of security satisfactory to Landlord,
in an amount sufficient to ensure the lien-free completion of such work, and
naming Landlord and any Mortgagee as co-obligees. Notwithstanding anything
contained in this Lease to the contrary, on or before the expiration or earlier
termination of this Lease, Tenant shall remove Tenant’s equipment from such
pits, shall fill in such pits, and shall make all repairs to the floor slab of
the Leased Premises that may be necessary to restore the floor slab to its
condition prior to the installation of such pits. All such work shall be
performed using methods and materials, and otherwise in a manner, reasonably
acceptable to Landlord. If Tenant fails to timely perform its repair and
restoration work under this Section 7.04(a), then, without limiting any other
remedy available to Landlord, Landlord may perform such obligations, and, in
such event, Tenant shall reimburse Landlord for all reasonable costs actually
incurred by Landlord in connection therewith. Tenant’s obligations under this
Section 7.04(a) shall survive the expiration or earlier termination of this
Lease.

 

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(b) Tenant may perform the installation work contemplated by Section 7.04(a)
above while Landlord is performing the Landlord Work pursuant and subject to the
terms of Section 2.06 of this Lease.

 

ARTICLE 8 - INDEMNITY AND INSURANCE

 

Section 8.01. Release. All of Tenant’s equipment, trade fixtures, merchandise,
inventory, special fire protection equipment, telecommunication and computer
equipment, supplemental air conditioning equipment, kitchen equipment and other
personal property located in or about the Leased Premises, the Building or the
Common Areas, which is deemed to include the trade fixtures, merchandise,
inventory and personal property of others located in or about the Leased
Premises or Common Areas at the invitation, direction or acquiescence (express
or implied) of Tenant (all of which property shall be referred to herein,
collectively, as “Tenant’s Property”), shall be and remain at Tenant’s sole
risk. Landlord shall not be liable to Tenant or to any other person for, and
Tenant hereby releases Landlord (and its affiliates, property managers, and
Mortgagees) from: (a) any and all liability for theft of or damage to Tenant’s
Property; and (b) any and all liability for any injury to Tenant or its
employees, agents, representatives, contractors, customers, guests and invitees
in or about the Leased Premises, the Building, the Common Areas, or the Park,
except to the extent that any of such loss or liability is caused by the
negligence or willful misconduct of Landlord, its agents, employees, or
contractors. Nothing contained in this Section 8.01 shall limit (or be deemed to
limit) the waivers contained in Section 8.06 below. In the event of any conflict
between the provisions of Section 8.06 below and this Section 8.01, the
provisions of Section 8.06 shall prevail. This Section 8.01 shall survive the
expiration or earlier termination of this Lease.

 

Section 8.02. Indemnification by Tenant. Tenant shall protect, defend,
indemnify, and hold harmless Landlord, its agents, and employees from and
against any and all claims, damages, demands, penalties, costs, liabilities,
losses, and expenses (including reasonable attorneys’ fees and expenses at the
trial and appellate levels) to the extent arising out of or relating to: (a) the
negligence, or willful misconduct of Tenant or Tenant’s agents, representatives,
guests, employees, contractors, customers, or invitees; (b) bodily injury or
property damage result from risk or attributes specifically associated with
Tenant’s Property; (c) any other act or occurrence within the Leased Premises,
(d) any transaction related to the tax incentives contemplated by Article 21 of
this Lease; or (e) any breach of this Lease by Tenant, in all such cases except
to the extent caused by the negligence or willful misconduct of Landlord, its
agents, employees, or contractors. Nothing contained in this Section 8.02 shall
limit (or be deemed to limit) the waivers contained in Section 8.06 below. In
the event of any conflict between the provisions of Section 8.06 below and this
Section 8.02, the provisions of Section 8.06 shall prevail. This Section 8.02
shall survive the expiration or earlier termination of this Lease.

 

Section 8.03. Indemnification by Landlord. Landlord shall protect, defend,
indemnify, and hold harmless Tenant, its agents, and employees from and against
any and all claims, damages, demands, penalties, costs, liabilities, losses and
expenses (including reasonable attorneys’ fees and expenses at the trial and
appellate levels) to the extent arising out of or relating to: (a) any
negligence or willful misconduct of Landlord or Landlord’s agents,
representatives, employees, or contractors; or (b) any breach of this Lease by
Landlord, in all such cases except to the extent caused by the negligence or
willful misconduct of Tenant, its agents, employees or contractors. Nothing
contained in this Section 8.03 shall limit (or be deemed to limit) the waivers
contained in Section 8.06 below. In the event of any conflict between the
provisions of Section 8.06 below and this Section 8.03, the provisions of
Section 8.06 shall prevail. This Section 8.03 shall survive the expiration or
earlier termination of this Lease.

 

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Section 8.04. Tenant’s Insurance.

 

(a) During the Lease Term (and any period of early entry or occupancy or holding
over by Tenant, if applicable), Tenant shall maintain the following types of
insurance, in the amounts specified below:

 

(i) Liability Insurance. Commercial General Liability Insurance, ISO Form CG 00
01, or its equivalent, covering Tenant’s use of or occupancy at the Leased
Premises against claims for bodily injury or death or property damage, which
insurance shall be primary and non-contributory and shall provide coverage on an
occurrence basis with a per occurrence limit of not less than $5,000,000 for
each policy year, which limit may be satisfied by any combination of primary and
excess or umbrella per occurrence policies.

 

(ii) Property Insurance. Special Form Insurance in the amount of the full
replacement cost of Tenant’s Property, all alterations or additions performed by
or for Tenant pursuant hereto, and all other leasehold improvements (but
excluding the roof, life-safety system, exterior walls, foundation, and
structural frame of the Building), which insurance shall waive coinsurance
limitations. Any insurance provided for in this Section 8.04(a)(ii) may be
maintained by means of a policy or policies of blanket insurance, covering
additional items or locations or insureds, provided, however, that: (A) such
blanket insurance shall be written on an occurrence basis; and (B) the
requirements set forth in this Section 8.04 are otherwise satisfied.

 

(iii) Worker’s Compensation Insurance. Worker’s Compensation insurance in
amounts required by applicable Laws; provided, if there is no statutory
requirement for Tenant, Tenant shall still obtain Worker’s Compensation
insurance coverage.

 

(iv) Business Interruption Insurance. Business Interruption Insurance with
limits not less than an amount equal to twelve (12) months’ rent hereunder.

 

(v) Automobile Insurance. Commercial Automobile Liability Insurance insuring
bodily injury and property damage arising from all owned, non-owned and hired
vehicles, if any, with minimum limits of liability of $1,000,000 combined single
limit, per accident.

 

(vi) Pollution Liability Insurance. Pollution Liability Insurance for bodily
injury, property damage and environmental damage caused by pollution incidents
arising from the Leased Premises. The policy will also cover emergency response
expenses that are required to contain and remediate the contamination onsite
where there is a legal obligation to do so. Minimum liability limits shall be
$1,000,000. Coverage shall include: First Party Onsite Cleanup, Third Party
Bodily Injury/Property Damage, Offsite Cleanup for both new and pre-existing
conditions, Sudden & Accidental and Gradual Pollution incidents, Emergency
Response Expense coverage, coverage for business interruption, and Illicit
Abandonment Coverage

 

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(b) All insurance required to be carried by Tenant hereunder shall (i) be issued
by one or more insurance companies reasonably acceptable to Landlord, authorized
to do business in the State in which the Leased Premises is located and having
an AM Best’s rating of A- VII or better, and (ii) provide that said insurer
shall endeavor to provide thirty (30) days prior notice if coverage is
materially changed, canceled or permitted to lapse. In addition, Tenant shall
name Landlord and any other parties in interest from time to time designated by
Landlord to Tenant as loss payee under all property policies required to be
maintained by Tenant under this Lease (except for any policies covering only
Tenant’s Property), and shall name Landlord, Landlord’s managing agent, and any
Mortgagee requested by Landlord as additional insureds under all liability,
excess and umbrella policies required to be maintained by Tenant under this
Lease (but only to the extent of the limits required hereunder). On or before
the Commencement Date (or the date of any earlier entry or occupancy by Tenant),
and thereafter, prior to the expiration of each such policy, Tenant shall
furnish Landlord with certificates of insurance in the form of ACORD 25 (or
other evidence of insurance reasonably acceptable to Landlord), evidencing all
required coverages, and that with the exception of Workers’ Compensation
insurance, such insurance is primary and non-contributory. Upon Tenant’s receipt
of a request from Landlord, Tenant shall provide Landlord with all endorsements,
as well as evidence reasonably acceptable to Landlord that Tenant is carrying
the coverages required hereunder. If Tenant fails to carry such insurance and
furnish Landlord with such evidence, Landlord may obtain such insurance on
Tenant’s behalf and Tenant shall reimburse Landlord upon demand for the cost
thereof as Additional Rent. Landlord reserves the right from time to time to
require Tenant to obtain higher minimum amounts or different types of insurance
if it becomes customary for other landlords of similar buildings in the area to
require similar sized tenants in similar industries to carry insurance of such
higher minimum amounts or of such different types.

 

Section 8.05. Landlord’s Insurance. During the Lease Term, Landlord shall
maintain the following types of insurance, in the amounts specified below (the
cost of which shall be included in Operating Expenses):

 

(a) Liability Insurance. Commercial General Liability Insurance, ISO Form CG 00
01, or its equivalent, covering the Common Areas against claims for bodily
injury or death and property damage, which insurance shall provide coverage on
an occurrence basis with a per occurrence limit of not less than $5,000,000 for
each policy year, which limit may be satisfied by any combination of primary and
excess or umbrella per occurrence policies.

 

(b) Property Insurance. Special Form Insurance in the amount of the full
replacement cost of the Building, including, without limitation, the roof,
life-safety system, exterior walls, foundation, and structural frame of the
Building, but excluding Tenant’s Property and any other items required to be
insured by Tenant pursuant to Section 8.04 above.

 

Section 8.06. Waiver of Subrogation. Notwithstanding anything contained in this
Lease to the contrary: (a) Landlord and Tenant shall each have included in all
policies of property insurance (including, without limitation, business
interruption insurance) respectively obtained by them covering the Leased
Premises, the Building or any contents therein (or any combination of the
foregoing), and in all policies of liability insurance respectively obtained by
them, a waiver by the insurer of all right of subrogation against the other in
connection with any loss or damage thereby insured against; and (b) Tenant shall
have included in its Worker’s Compensation insurance policy a waiver by the
insurer of all right of subrogation against Landlord. Any additional premium for
such waiver shall be paid by the primary insured. To the full extent permitted
by law, Landlord and Tenant each waives all right of recovery against the other,
and agrees to release the other from liability, for loss or damage to the extent
such loss or damage is covered by valid insurance, in effect covering the party
seeking recovery at the time of such loss or damage, or would be covered by the
insurance required to be maintained under this Lease by the party seeking
recovery. If the release of either party, as set forth above, should contravene
any law with respect to exculpatory agreements, the liability of the party in
question shall be deemed not released but shall be secondary to the liability of
the other’s insurer.

 

ARTICLE 9 - CASUALTY

 

Section 9.01. Total Destruction. If the Building should be totally destroyed by
fire, tornado or other casualty, either Landlord or Tenant may terminate this
Lease by notice to the other party within thirty (30) days after the occurrence
of such destruction, and this Lease shall expire on the thirtieth (30th) day
after the date of such notice.

 

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Section 9.02. Partial Destruction.

 

(a) If the Building should be damaged to the extent that, in Landlord’s
reasonable judgment, repair would not be economically feasible; or that
rebuilding or repairs cannot, in Landlord’s estimation, be completed within two
hundred ten (210) days after the date of such damage; or if the insurance
proceeds remaining after any required payments to Mortgagees are insufficient to
repair such damage or destruction, Landlord shall have the right, at Landlord’s
option, to terminate this Lease by giving Tenant written notice of such
termination within sixty (60) days after the date of such casualty, and the Rent
shall be apportioned and paid to the date on which possession is relinquished or
the date of such damage, whichever last occurs, and Tenant shall promptly vacate
the Leased Premises according to such notice of termination.

 

(b) If the Building should be damaged by any peril covered by the insurance to
be provided by Landlord under Section 8.05 above, but only to such extent that
rebuilding or repairs are, in Landlord’s estimation, economically feasible and
can be completed within two hundred ten (210) days after the date of such damage
and the proceeds of such insurance, after deducting any required payments to
Mortgagees, are sufficient for such rebuilding or repairs, then, unless this
Lease is terminated by either Landlord or Tenant pursuant to an express
termination right under this Article 9, this Lease shall not terminate, and
Landlord shall at its sole cost and expense thereupon proceed with reasonable
diligence to rebuild and repair the Building to substantially the condition in
which it existed prior to such damage, except that Landlord shall not be
required to rebuild, repair or replace any of the leasehold improvements,
partitions, fixtures, additions and other improvements which may have been
placed in, on or about the Leased Premises. If Tenant does not occupy the Leased
Premises during the period of such repairs, then during such period, Landlord
shall regularly communicate with Tenant regarding the progress of such repairs
so that Tenant can reasonably plan for the recommencement of Tenant’s occupancy
of the Leased Premises. If the Leased Premises are untenantable in whole or in
part following such damage, the Rent payable hereunder during the period in
which the Leased Premises are untenantable shall be reduced to such extent as
may be fair and reasonable under all of the circumstances.

 

Section 9.03. Tenant’s Obligations. Tenant shall be obligated to repair and
restore all leasehold improvements, alterations and additions situated in or
about the Leased Premises in the event of any damage or destruction thereto by
any peril covered by the provisions of this Article 9; provided, however, that,
if this Lease is terminated under this Article 9, then, in lieu of repairing and
restoring such items, Tenant shall promptly pay to Landlord all insurance
proceeds received by Tenant for the damage or destruction pertaining to such
items. Tenant shall use commercially reasonable efforts to obtain such proceeds
from its insurer(s). Tenant’s obligations under this Section 9.03 shall survive
the expiration or earlier termination of this Lease.

 

Section 9.04. Termination.

 

(a) Notwithstanding anything herein to the contrary, in the event any Mortgagee
requires that the insurance proceeds be applied to the indebtedness due such
Mortgagee, then Landlord shall have the right to terminate this Lease by
delivering written notice of termination to Tenant within fifteen (15) days
after such requirement is made by any such Mortgagee, whereupon all rights and
obligations hereunder shall cease and terminate.

 

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(b) If any damage under this Article 9 renders all or a “Substantial Portion”
(as hereinafter defined) of the Leased Premises untenantable, and if Landlord
does not exercise any right that it may have to terminate this Lease, Landlord
shall, not more than sixty (60) days after the occurrence of such damage,
provide Tenant with a reasonable estimate from an independent architect or
contractor of the length of time that will be required to substantially complete
the repair and restoration of the Leased Premises to the extent such repair and
restoration are the obligation of Landlord hereunder, and shall by notice advise
Tenant of such estimate. If it is so estimated that the amount of time required
to substantially complete such repair and restoration of the Leased Premises
will exceed two hundred ten (210) days from the date such damage occurred, then
Tenant shall have the right to terminate this Lease as of the date of notice of
such election by giving notice to Landlord at any time within twenty (20) days
after Landlord gives Tenant the notice containing said estimate. If this Lease
is not terminated in connection with such damage, Landlord will fulfill its
repair and restoration obligations under this Article 9. However, Landlord shall
have no liability to Tenant, and Tenant shall not be entitled to terminate this
Lease (except as hereinafter provided), if such repairs and restoration are not
in fact completed within the estimated time period provided by Landlord, as
aforesaid, or within said two hundred ten (210) days. However, if such repairs
and restoration are not completed by a date (the “Outside Date”) which is twelve
(12) months after the date of such fire or other casualty [or ninety-five (95)
days after the expiration of the time period estimated by Landlord as aforesaid,
if longer than two hundred ten (210) days and neither party terminated the Lease
as permitted], which Outside Date shall be extended (as to Tenant’s ability to
terminate the Lease only) by all periods of delay attributable to Force Majeure
and/or the acts or omissions of Tenant, or Tenant’s agents, employees or
contractors, then either party may terminate this Lease effective as of the date
of notice of such election, by giving written notice to the other party within
the thirty (30) day period after such Outside Date, as extended as aforesaid,
but prior to substantial completion of repair or restoration. As to Tenant’s
right to terminate, a Force Majeure extension of the Outside Date (but not an
extension due to the acts or omissions of Tenant, or Tenant’s agents, employees
or contractors) shall be limited to a maximum of twelve (12) months. As used
herein, the phrase “Substantial Portion” of the Leased Premises means more than
fifty percent (50%) of the Rentable Area of the Leased Premises.

 

(c) Notwithstanding anything to the contrary in this Article 9, if any damage
during the final twelve (12) months of the Lease Term renders the Leased
Premises wholly untenantable, either Landlord or Tenant may terminate this Lease
by notice to the other party within thirty (30) days after the occurrence of
such damage, and this Lease shall expire on the thirtieth (30th) day after the
date of such notice. For purposes of this Section 9.04(c), the Leased Premises
shall be deemed wholly untenantable if Tenant shall be precluded from using more
than fifty percent (50%) of the Leased Premises for the conduct of its business
and Tenant’s inability to so use the Leased Premises is reasonably expected to
continue for more than ninety (90) days.

 

 

ARTICLE 10 - EMINENT DOMAIN

 

If the whole or any “Substantial Part” (as hereinafter defined) of the Leased
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, either Landlord or Tenant may terminate this Lease
effective as of the date on which the physical taking of the Leased Premises
shall occur, in which event the Rent shall be apportioned and paid to such date.
If part of the Leased Premises shall be taken for any public or quasi-public use
under any governmental law, ordinance or regulation, or by right of eminent
domain, or by private purchase in lieu thereof, and this Lease is not terminated
as provided above, this Lease shall not terminate but the Rent payable hereunder
during the unexpired portion of this Lease shall be reduced to such extent as
may be fair and reasonable under all of the circumstances. If part of Tenant’s
Parking Lot shall be taken for any public or quasi-public use under any
governmental law, ordinance or regulation, or by right of eminent domain, or by
private purchase in lieu thereof, and there are less than one hundred (100)
parking spaces remaining in Tenant’s Parking Lot after such taking, then Tenant
shall have the right to terminate this Lease as of the date the condemning
authority takes title or possession, whichever occurs first, by giving written
notice of such termination to Landlord not later than thirty (30) days after
said date; provided, however, that if Landlord is able to provide alternative
parking arrangements within the Park so that, when combined with any
then-remaining parking within the Parking Lot, such alternative parking
arrangements result in at least one hundred (100) parking spaces being made
available to Tenant, then Tenant shall have no right to terminate this Lease.
All compensation awarded for any taking (or the proceeds of private sale in lieu
thereof) of the Leased Premises, the Building or other improvements, or any part
thereof, shall be the property of Landlord and Tenant hereby assigns its
interest in any such award to Landlord; provided, however Landlord shall have no
interest in any award made to Tenant for loss of business, loss to Tenant’s
Property, or relocation expenses if a separate award for such items is made to
Tenant. In no event shall Landlord be required under this Lease to incur any
expenses in excess of available proceeds from any taking contemplated hereby for
the purposes of restoring the Building or the Leased Premises after any such
taking. As used in this Article 10, the phrase “Substantial Part” of the Leased
Premises means: (a) if the “Tenant” under this Lease is the original Tenant that
executed this Lease or a party that succeeded to the interest of such original
Tenant by a Permitted Transfer, more than twenty percent (20%) of the production
area (i.e., the area where Tenant’s max machines are located) portion of the
Leased Premises; and (b) if the “Tenant” under this Lease is any other party,
such portion of the Premises as would prevent or materially interfere with the
use of or access to the Leased Premises for the purpose for which they are being
used.

 

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ARTICLE 11 - ASSIGNMENT AND SUBLEASE

 

Section 11.01. Assignment and Sublease.

 

(a) Except for a Permitted Transfer, Tenant shall not, without the prior written
consent of Landlord, which consent shall be granted or denied in accordance with
Section 11.01(b) below, assign this Lease, permit any assignment of this Lease
or any interest hereunder by operation of law or otherwise, sublet the Leased
Premises or any part thereof, or enter into any license or concession agreements
or otherwise permit the occupancy or use of the Leased Premises or any part
thereof by any persons other than Tenant and its employees. In addition, Tenant
shall not, without the prior written consent of Landlord, which may be withheld
for any reason or for no reason, in the sole and absolute discretion of
Landlord, mortgage, pledge, hypothecate, encumber, or permit any lien to attach
to this Lease or any interest hereunder. In the event of any permitted
assignment or subletting: (i) Tenant shall remain primarily liable hereunder;
and (b) unless such assignment or subletting is a Permitted Transfer, any
extension, expansion, rights of first offer, rights of first refusal or other
options granted to Tenant under this Lease shall be rendered void and of no
further force or effect. The acceptance of rent by Landlord from any other
person or entity shall not be deemed to be a waiver of any of the provisions of
this Lease or to be a consent to the assignment of this Lease or the subletting
of the Leased Premises. No assignment or sublease shall relieve Tenant (or its
assignee) from obtaining Landlord’s consent to any subsequent assignment or
sublease hereunder.

 

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(b) Notwithstanding the provisions of Section 11.01(a) above, Landlord shall not
unreasonably withhold, condition or delay its consent to an assignment of this
Lease in its entirety or to any subletting of the Leased Premises. By way of
example and not limitation, Landlord shall be deemed to have reasonably withheld
consent to a proposed assignment or sublease if in Landlord’s reasonable opinion
(i) the Leased Premises are or may be in any way adversely affected thereby;
(ii) the business reputation of the proposed assignee or subtenant is
unacceptable; (iii) the financial worth of the proposed assignee or subtenant is
insufficient to meet the obligations of Tenant under this Lease, (iv) the
prospective assignee or subtenant is a current tenant at the Park or is a
bona-fide third-party prospective tenant to which Landlord has made, or from
which Landlord has received, a written offer or written request for proposal
concerning the leasing or use of space at the Park, (v) any Default shall have
occurred and shall then be continuing, (vi) the character of the business to be
conducted or the proposed use of the Leased Premises by the proposed subtenant
or assignee is likely to: (a) increase Operating Expenses beyond those which
would be incurred for use by Tenant or for use in accordance with the standards
of use of other tenancies in the Building and in parks and buildings that are
similar to the Building and the Park located in the greater Atlanta, Georgia
area, (b) violate any provision or restrictions herein or in any other leases in
the Park, or (c) increase the demand for parking spaces beyond those required by
Tenant under this Lease, (vi) such transfer will result in more than two (2)
tenants or subtenants, including Tenant, occupying the Leased Premises, (vii)
any guarantor of this Lease shall refuse to consent to such assignment or
sublease, or refuse to agree in writing, in a manner satisfactory to Landlord,
that such transaction shall not affect such guarantor’s liability under its
guaranty, (viii) the proposed subtenant or assignee is a federal, state or local
government, or an agency or instrumentality thereof, or is entitled, directly or
indirectly, to diplomatic or sovereign immunity, or (ix) the proposed subtenant
or assignee is not subject to service of process in, and the jurisdiction of the
courts of, the State of Georgia. Landlord further expressly reserves the right
to refuse to give its consent to any subletting if the proposed rent is publicly
advertised to be less than the rent publicly advertised for similar premises in
comparable buildings in the vicinity of the Building. The foregoing shall in no
way limit Landlord’s ability to withhold or delay its consent for any other
reason which is reasonable under the circumstances. If Landlord refuses to give
its consent to any proposed assignment or subletting, unless such assignment or
subletting is a Permitted Transfer, Landlord may, at its option, within thirty
(30) days after receiving a request to consent, terminate this Lease by giving
Tenant thirty (30) days’ prior written notice of such termination, whereupon
each party shall be released from all further obligations and liability
hereunder, except those which expressly survive the termination of this Lease.
If Landlord fails to approve or disapprove any assignment or sublease within
fifteen (15) business days after Tenant’s request for approval thereof, Landlord
shall be deemed to have disapproved such assignment or sublease. However, if
Landlord is deemed to have disapproved such assignment or sublease by reason of
Landlord’s failure to timely notify Tenant in writing of Landlord’s election,
Tenant may provide Landlord with written notice of such failure to respond (the
“Second Notice”), which, in order to be effective, must clearly, conspicuously
and in bold type face set forth the following statement at the top of the first
page of the Second Notice: “SECOND NOTICE! THE FAILURE OF LANDLORD TO RESPOND
WITHIN FIVE (5) BUSINESS DAYS AFTER THE RECEIPT OF THIS SECOND NOTICE BY
LANDLORD SHALL BE DEEMED TO BE A CONSENT TO THE PROPOSED SUBLEASE OR
ASSIGNMENT.” If Landlord should fail to notify Tenant in writing of its election
as to such sublease or assignment within five (5) business days after receipt of
such Second Notice, Landlord shall be deemed to have approved such assignment or
sublease.

 

(c) If Tenant shall make any assignment or sublease, with Landlord’s consent,
for a rental in excess of the rent payable under this Lease, Tenant shall pay to
Landlord fifty percent (50%) of any “Transfer Premium” (as hereinafter defined)
received by Tenant from the transferee. “Transfer Premium” shall mean all rent,
including additional rent, and other consideration payable by such transferee,
or any other entity or person related to, or affiliated with such transferee, in
connection with the assignment or sublease or such party’s occupancy of the
Leased Premises or any part thereof in excess of the Rent payable by Tenant
under this Lease, on a per square foot basis if less than all of the Leased
Premises is transferred, after deducting the reasonable expenses incurred by
Tenant for: (i) any changes, alterations and improvements to the transfer space
in connection with the transfer; (ii) any commercially reasonable out-of-pocket
concessions provided to the transferee; and (iii) any commercially reasonable
brokerage commissions in connection with the transfer. The Transfer Premium
shall also include, but not be limited to, key money, bonus money or other cash
consideration paid by the transferee, or any other entity or person related to,
or affiliated with such transferee, to Tenant in connection with the assignment
or sublease, and any payment in excess of fair market value for services
rendered by Tenant to the transferee, or for assets, fixtures, inventory,
equipment or furniture transferred by Tenant to the transferee in connection
with such assignment or sublease. Upon request by Landlord, Tenant shall provide
to Landlord paid invoices and other documents and information satisfactory to
Landlord evidencing any expenses incurred by Tenant pursuant to the foregoing
terms of this Section 11.01(c). Whether or not Landlord consents to any proposed
transfer, Tenant shall pay Landlord’s review and processing fees, as well as any
reasonable professional fees and expenses (including, without limitation,
attorneys’, accountants’, architects’, engineers’ and consultants’ fees and
expenses) incurred by Landlord. If requested by Landlord, such fees shall be due
and payable to Landlord prior to Landlord’s execution of a consent to the
proposed transfer.

 

26

 

 

Section 11.02. Permitted Transfer. Notwithstanding anything contained in this
Article 11 to the contrary, but subject to compliance with all other provisions
of this Lease, Tenant shall have the right, upon thirty (30) days’ prior written
notice to Landlord (the “Permitted Transfer Notice”), to assign this Lease or
sublet the Leased Premises, without Landlord’s consent, to a “Tenant Affiliate”
or a “Permitted Successor” (both as hereinafter defined), provided that: (a)
with respect to a transfer to a Permitted Successor, the tangible net worth
(exclusive of goodwill) of the Permitted Successor is equal to or greater than
Tenant’s net worth on the date of Landlord’s execution of this Lease; (b) in the
case of an assignment, the Tenant Affiliate or Permitted Successor shall
unconditionally assume in writing, and shall be deemed to have assumed, this
Lease and shall be jointly and severally liable with Tenant for all payments and
for the due performance of all terms, covenants and conditions herein contained
which are required to be paid and performed by Tenant; (c) no assignment shall
be binding upon Landlord unless such assignee shall deliver to Landlord an
instrument containing a covenant of assumption by such assignee, but the failure
or refusal of such assignee to execute the same shall not release either the
assignor or such assignee from its liability as set forth herein effective upon
the consummation of such assignment; (d) the Tenant Affiliate or Permitted
Successor (as applicable) shall have a good business reputation, as determined
in Landlord’s reasonable judgment; (e) with respect to a transfer to a Tenant
Affiliate, the Tenant Affiliate remains an affiliate meeting the definition of
“Tenant Affiliate” for the duration of the subletting or the balance of the
Lease Term in the event of an assignment, and neither Tenant nor any guarantor
of this Lease, or of any of the obligations of Tenant hereunder, are dissolved
as a matter of law as a consequence of the assignment or subletting or at any
time thereafter; (f) no proposed assignment or sublease shall be effective
unless any guarantor of this Lease, or of any of the obligations of Tenant
hereunder, consents to such assignment or sublease and agrees in writing with
Landlord that such transaction shall not affect such guarantor’s liability under
its guaranty; and (g) the primary purpose of such assignment or sublease is for
legitimate business reasons unrelated to this Lease and such assignment or
sublease is not, in whole or in part, a subterfuge to avoid the obligations or
restrictions set forth in this Lease. Tenant shall provide, in the Permitted
Transfer Notice, a financial statement and such other information for the Tenant
Affiliate or Permitted Successor (as applicable), to establish that the proposed
assignment or sublease meets the requirements of this Section 11.02, and such
other information as Landlord may reasonably require to assess compliance with
these terms. No assignment or subletting permitted by this paragraph shall
relieve Tenant of its primary liability under this Lease. As used herein: (i)
the term “Tenant Affiliate” means any partnership, corporation or other entity
which controls, is controlled by, or is under common control with Tenant; (ii)
the term “Permitted Successor” means any partnership, corporation or other
entity resulting from a merger or consolidation with Tenant, or any person or
entity which acquires substantially all the assets, ownership interests or stock
of Tenant as a going concern; (iii) the term “control” means ownership of at
least fifty percent (50%) of the equity interests in, or the possession,
directly or indirectly, of the power to direct or cause the direction of the
management or policies of, the controlled entity; and (iv) the term “Permitted
Transfer” shall refer to any assignment or sublease to a Tenant Affiliate or
Permitted Successor that does not require Landlord’s consent under this Section
11.02.

 

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ARTICLE 12 - TRANSFERS BY LANDLORD

 

Section 12.01. Sale of the Building. Landlord shall have the right to sell the
Building and Common Areas at any time during the Lease Term, subject only to the
rights of Tenant hereunder; and such sale shall operate to release Landlord from
liability accruing hereunder after the date of such conveyance.

 

Section 12.02. Estoppel Certificate. Within ten (10) business days following
receipt of a written request from Landlord, Tenant shall execute and deliver to
Landlord, without cost to Landlord, an estoppel certificate in such form as
Landlord may reasonably request certifying: (a) that this Lease is in full force
and effect and unmodified or stating the nature of any modification; (b) the
date to which rent has been paid; (c) that there are not, to Tenant’s knowledge,
any uncured defaults or specifying such defaults if any are claimed; and (d) any
other matters or state of facts reasonably required respecting this Lease. Such
estoppel may be relied upon by Landlord and by any purchaser or Mortgagee of the
Building.

 

Section 12.03. Subordination.

 

(a) Tenant accepts this Lease as subject and subordinate to any recorded
mortgages, deeds to secure debt, deeds of trust, ground leases and other similar
security instruments (each, a “Mortgage”) and encumbrances presently existing or
hereafter created upon the Leased Premises or Building, and all other
encumbrances and matters of public record applicable to the Building or Park or
any part thereof presently existing or hereafter created upon the Leased
Premises or Building, including without limitation, any reciprocal easement or
operating agreements, ground or underlying leases, covenants, conditions and
restrictions, and all amendments, modifications and restatements thereof, and
all replacements and substitutions therefor. If any such Mortgage be foreclosed,
upon request of the holder thereof, Tenant will attorn to the purchaser at the
foreclosure sale. The foregoing provisions are declared to be self-operative and
no further instruments shall be required to effect such subordination and/or
attornment. Within ten (10) business days following receipt of a written request
from Landlord, Tenant shall execute and deliver to Landlord, without cost, any
commercially reasonable instrument that Landlord deems reasonably necessary or
desirable to confirm the subordination of this Lease.

 

(b) Without limiting the generality of Section 12.03(a) above, Tenant
acknowledges that, in connection with the tax incentives contemplated by Article
21 of this Lease, Landlord may be required to transfer title to the Building or
Building Project to an instrumentality of Henry County, which will then lease
the Building or Building Project (as applicable) to Landlord (such lease being
hereinafter referred to as the “Development Authority Lease”). In such event,
upon the consummation of the Development Authority Lease: (i) this Lease shall
become a sublease under the Development Authority Lease; and (ii) this Lease
shall become subject and subordinate to the Development Authority Lease. The
foregoing provisions are declared to be self-operative and no further
instruments shall be required to effect the subordination of this Lease to the
Development Authority Lease. However, within ten (10) business days following
receipt of a written request from Landlord, Tenant shall execute and deliver to
Landlord, without cost, any commercially reasonable instrument that Landlord
deems necessary or desirable to confirm the subordination of this Lease to the
Development Authority Lease. Should the Development Authority Lease be
terminated prior to the expiration or earlier termination of this Lease, then,
upon the transfer of title to the Building Project back to Landlord, this Lease
shall remain in effect as a direct lease between Landlord and Tenant, and shall
no longer be subject and subordinate to the Development Authority Lease.

 

(c) After the full execution and delivery of this Lease, Landlord shall not
voluntarily record as an encumbrance upon the Leased Premises, the Building,
and/or the Park any covenants, conditions, and restrictions relating to Leased
Premises, the Building, and/or the Park which have the effect of prohibiting
Tenant’s use of the Leased Premises for the Permitted Use, or of materially
modifying any express rights granted to Tenant under this Lease with respect to
use of the Leased Premises or the Parking Lot, or loading or unloading or truck
access. However, the recording of any instrument that may be required to effect
the tax incentives contemplated by Article 21 of this Lease shall in no event be
deemed to be a breach of this Section 12.03(c).

 

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ARTICLE 13 - DEFAULT AND REMEDY

 

Section 13.01. Default. The occurrence of any of the following shall be a
“Default”:

 

(a) Tenant shall fail to pay any installment of the Rent herein reserved when
due, or any other payment or reimbursement to Landlord required herein when due,
and such failure shall continue for a period of five (5) business days after
Landlord gives Tenant written notice of such past due Rent or other payment; or
Tenant shall fail to pay Rent or any other payment required herein within five
(5) business days after the date due, at any time during a twelve (12) month
period in which Tenant has already received two (2) previous notices of its
failure to pay Rent or other payments by the due date.

 

(b) Tenant fails to perform or observe any other term, condition, covenant or
obligation required under this Lease (other than those governed by subsections
(c) through (e) below) for a period of thirty (30) days after written notice
thereof from Landlord; provided, however, that if the nature of Tenant’s default
is such that more than thirty (30) days are reasonably required to cure, then
such default shall be deemed to have been cured if Tenant commences such
performance within said thirty (30) day period and actually completes such
performance within ninety (90) days after Landlord’s notice of the applicable
failure.

 

(c) Tenant shall fail to deliver any instrument or certificate required under
Article 12 of this Lease within the applicable time period therefor specified in
such Article 12.

 

(d) Tenant shall assign or sublet all or a portion of the Leased Premises in
violation of the provisions of Article 11 of this Lease.

 

(e) All or substantially all of Tenant’s assets in the Leased Premises or
Tenant’s interest in this Lease are attached or levied under execution (and
Tenant does not discharge the same within sixty (60) days thereafter); a
petition in bankruptcy, insolvency or for reorganization or arrangement is filed
by or against Tenant (and Tenant fails to secure a stay or discharge thereof
within sixty (60) days thereafter); Tenant is insolvent and unable to pay its
debts as they become due; Tenant makes a general assignment for the benefit of
creditors; Tenant takes the benefit of any insolvency action or law; the
appointment of a receiver or trustee in bankruptcy for Tenant or its assets if
such receivership has not been vacated or set aside within sixty (60) days
thereafter; or, dissolution or other termination of Tenant’s corporate charter
if Tenant is a corporation.

 

(f) Failure of Tenant to comply with any of the terms and provisions of Article
15 of this Lease relating to Hazardous Substances, and such failure continues
for more than two (2) business days after written notice from Landlord to Tenant
requiring that Tenant correct such failure.

 

Notwithstanding anything contained in this Lease to the contrary, if Tenant
breaches any non-monetary covenant, condition or agreement contained herein on
Tenant’s part to be kept or performed three (3) or more times within any twelve
(12) month period, the third, and each subsequent, breach during such twelve
(12) month period shall constitute an immediate Default by Tenant under this
Lease, without the necessity of providing any notice, or any grace or cure
period, to Tenant, and Landlord shall be entitled to immediately exercise any
remedy available under this Lease, at law or in equity. For the avoidance of
doubt, any initial or second breach of any non-monetary covenant, condition or
agreement contained herein on Tenant’s part to be kept or performed during any
twelve (12) month period may ripen into a Default (which will entitle Landlord
to exercise its remedies), but Landlord shall be obligated to first provide
Tenant with any applicable notice, and any applicable grace or cure period, that
may be set forth in this Lease; provided, however, that nothing contained in
this paragraph shall be deemed to create any independent requirement to provide
notices, or grace or cure periods, other than or in addition to any such
requirements that may be set forth elsewhere in this Lease.

 

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Section 13.02. Remedies. Upon the occurrence of any Default which continues
beyond any applicable notice and cure period under this Lease, Landlord shall
have the following rights and remedies, in addition to those stated elsewhere in
this Lease and those allowed by law or in equity, any one or more of which may
be exercised without further notice to Tenant (provided, however, that Landlord
may not exercise any remedy in a manner that would violate any applicable Law):

 

(a) Landlord may re-enter the Leased Premises and cure any such Default of
Tenant, and Tenant shall, within ten (10) days after demand therefor, reimburse
Landlord, as Additional Rent, for any reasonable costs and expenses that
Landlord thereby reasonably incurs; and Landlord shall not be liable to Tenant
for any loss or damage that Tenant may sustain by reason of Landlord’s action.

 

(b) Landlord may terminate this Lease by giving Tenant notice of termination, in
which event this Lease shall expire and terminate on the date specified in such
notice of termination and all rights of Tenant under this Lease and in and to
the Leased Premises shall terminate, except with respect to any provisions
thereunder that expressly survive such termination. Tenant shall remain liable
for all obligations under this Lease arising up to the date of such termination,
and Tenant shall surrender the Leased Premises to Landlord on the date specified
in such notice and otherwise in accordance with the surrender requirements of
this Lease. Furthermore, in the event that Landlord terminates this Lease,
Tenant shall be liable to Landlord for the unamortized balance of the cost paid
for Landlord’s Work and of brokerage fees paid in connection with this Lease.

 

(c) Without terminating this Lease, Landlord may terminate Tenant’s right to
possession of the Leased Premises, and thereafter, neither Tenant nor any person
claiming under or through Tenant shall be entitled to possession of the Leased
Premises. In such event, Tenant shall immediately surrender the Leased Premises
to Landlord, and Landlord may re-enter the Leased Premises and dispossess Tenant
and any other occupants of the Leased Premises by any lawful means and may
remove their effects, without prejudice to any other remedy that Landlord may
have. Upon termination of possession, Landlord may re-let all or any part
thereof as the agent of Tenant for a term different from that which would
otherwise have constituted the balance of the Lease Term and for rent and on
terms and conditions different from those contained herein, whereupon Tenant
shall be immediately obligated to pay to Landlord an amount equal to: (i) the
difference between the Rent provided for herein and the amount of any lesser
amount of rent provided for in any lease covering a subsequent re-letting of the
Leased Premises, for the period which would otherwise have constituted the
balance of the Lease Term, had this Lease not been terminated (said period being
referred to herein as the “Remaining Term”); (ii) the costs of recovering
possession of the Leased Premises and all other expenses, loss or damage
incurred by Landlord by reason of Tenant’s Default (“Default Damages”), which
shall include, without limitation, expenses of preparing the Leased Premises for
re-letting, demolition, repairs, tenant finish improvements, brokers’
commissions and attorneys’ fees, (iii) the unamortized balance of the cost paid
for Landlord’s Work and of brokerage fees paid in connection with this Lease,
and (iv) all unpaid Minimum Annual Rent and Additional Rent that accrued prior
to the date of termination of possession, plus any interest and late fees due
hereunder (collectively, the “Prior Obligations”). Neither the filing of any
dispossessory proceeding nor an eviction of personalty in the Leased Premises
shall be deemed to terminate this Lease.

 

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(d) Landlord may at its option, declare the difference, if any, between: (a) the
entire amount of Rent which would become due and payable during the remainder of
the Term, discounted to present value using a discount rate equal to the Prime
Rate in effect as of the date of such declaration; and (b) the fair rental value
of the Leased Premises during the remainder of the Term (taking into account,
among other factors, an assessment of future market conditions for the Leased
Premises, the probability of reletting the Leased Premises for all or part of
the remainder of the Term, the anticipated duration of the period the Leased
Premises will be unoccupied prior to reletting and the anticipated cost of
reletting the Leased Premises), also discounted to present value using a
discount rate equal to the Prime Rate in effect as of the date of such
declaration, to be due and payable immediately and Tenant agrees to pay the same
at once, together with all Rent and other sums theretofore due; it being
understood and agreed that such payment shall be and constitute Landlord’s
liquidated damages, Landlord and Tenant acknowledging and agreeing that it is
difficult or impossible to determine the actual damages Landlord would suffer
from Tenant’s breach hereof and that the agreed upon liquidated damages are not
punitive or penalties and are just, fair and reasonable, all in accordance with
Official Code of Georgia Annotated §13-6-7. If Landlord exercises the election
set out in this Section 13.02(d), Landlord hereby waives any right to assert
that Landlord’s actual damages are greater than the amount calculated hereunder.

 

(e) Unless prohibited by applicable Law, Landlord may sue for injunctive relief
or to recover damages for any loss resulting from the Default. In no event,
however, shall Landlord be liable to Tenant for any punitive damages.

 

Section 13.03. Landlord’s Default and Tenant’s Remedies. Landlord shall be in
default if it fails to perform any term, condition, covenant or obligation
required under this Lease for a period of thirty (30) days after written notice
thereof from Tenant to Landlord; provided, however, that if the term, condition,
covenant or obligation to be performed by Landlord is such that it cannot
reasonably be performed within thirty (30) days, such default shall be deemed to
have been cured if Landlord commences such performance within said thirty-day
period and thereafter diligently undertakes to complete the same. Upon the
occurrence of any such default by Landlord, Tenant may sue for injunctive relief
or to recover damages for any loss directly resulting from such default, but
Tenant shall not be entitled to terminate this Lease or withhold, offset or
abate any sums due hereunder. In no event, however, shall Landlord be liable to
Tenant for any consequential or punitive damages.

 

Section 13.04. Nonwaiver of Defaults. Neither party’s failure nor delay in
exercising any of its rights or remedies or other provisions of this Lease shall
constitute a waiver thereof or affect its right thereafter to exercise or
enforce such right or remedy or other provision at that time or in the future.
No waiver of any default shall be deemed to be a waiver of any other default.
Landlord’s receipt of less than the full Rent due shall not be construed to be
other than a payment on account of rent then due, nor shall any statement on
Tenant’s check or any letter accompanying Tenant’s check be deemed an accord and
satisfaction, and Landlord may accept such payment without prejudice to
Landlord’s right to recover the balance due or to pursue any other remedy
available to Landlord. No act or omission by Landlord or its employees or agents
during the Lease Term shall be deemed an acceptance of a surrender of the Leased
Premises, and no agreement to accept such a surrender shall be valid unless in
writing and signed by Landlord.

 

Section 13.05. Attorneys’ Fees. If either party defaults in the performance or
observance of any of the terms, conditions, covenants, or obligations contained
in this Lease, and if the non-defaulting party obtains a judgment against the
defaulting party, then the defaulting party agrees to reimburse the
non-defaulting party for reasonable attorneys’ fees incurred in connection
therewith.

 

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Section 13.06. Mitigation of Damages. Subject to the terms of this Section
13.06, if a Default by Tenant under this Lease occurs and continues beyond any
applicable notice and cure period under this Lease, and if Landlord terminates
Tenant’s right to possess the Leased Premises, Landlord shall use commercially
reasonable efforts to mitigate its damages under this Lease; provided, however,
that (a) Landlord shall have no obligations to solicit or entertain negotiations
with any other prospective tenants for the Leased Premises unless and until
Landlord obtains possession of the Leased Premises and Tenant has acknowledged
no further possessory rights therein; (b) Landlord shall not be obligated to
lease or show the Leased Premises on a priority basis, it being the intent
hereof that any such space shall be treated by Landlord as a part of Landlord’s
general supply of unleased, previously built-out space in the Building, and
Landlord shall be obligated merely to use reasonable efforts to respond in the
ordinary course of Landlord’s business to inquiries concerning the Leased
Premises, and shall not be required to exceed such efforts as Landlord generally
uses to lease other space in the Building; (c) Landlord will not be deemed to
have failed to mitigate if Landlord or its affiliates lease any other portions
of the Building or other properties owned by Landlord or its affiliates in the
same geographic area, before reletting all or any portion of the Leased
Premises; and (d) any failure to mitigate as described herein with respect to
any period of time shall only reduce the Rent and other amounts to which
Landlord is entitled hereunder by the reasonable rental value of the Leased
Premises during such period. In recognition that the value of the Building
depends on the rental rates and terms of leases therein, Landlord’s rejection of
a prospective replacement tenant based on an offer of rents below Landlord’s
published rates for new leases of comparable space at the Building at the time
in question, or at Landlord’s option, below the rates provided in this Lease, or
containing terms less favorable than those contained herein, shall not give rise
to a claim by Tenant that Landlord failed to mitigate Landlord’s damages.
Furthermore, Landlord shall not be obligated to enter into a lease with a
prospective replacement tenant which does not have, in Landlord’s reasonable
opinion, sufficient financial resources to fulfill all of financial obligations
in connection with the lease thereof as and when the same become due, or whose
use would: (i) violate any restriction, covenant, or requirement contained in
the lease of another tenant of the Park; (ii) adversely affect the reputation of
the Building or the Park; or (iii) in Landlord’s reasonable judgment, be
incompatible with the operation of the Building.

 

ARTICLE 14 - NO RIGHT TO RELOCATE TENANT

 

Without Tenant’ prior written consent, which Tenant may grant or withhold, in
its sole discretion, Landlord shall not have the right to relocate Tenant from
the Leased Premises to other space in the Building during the Lease Term.
However, nothing contained in this Article 14 shall limit Landlord’s rights and
remedies in the event of a Default by Tenant.

 

ARTICLE 15 – LANDLORD’S AND TENANT’S RESPONSIBILITIES REGARDING

ENVIRONMENTAL LAWS AND HAZARDOUS SUBSTANCES

 

Section 15.01. Environmental Definitions.

 

(a) “Environmental Laws” shall mean all present or future federal, state and
municipal laws, ordinances, rules and regulations applicable to the
environmental and ecological condition of the Leased Premises, the Building and
the Common Areas, and the rules and regulations of the Federal Environmental
Protection Agency and any other federal, state or municipal agency or
governmental board or entity having jurisdiction over the environmental and
ecological condition of the Leased Premises, the Building and the Common Areas.

 

(b) “Hazardous Substances” shall mean asbestos, polychlorinated biphenyls, oil,
gasoline or other petroleum based liquids, any and all materials or substances
deemed hazardous, toxic, pollutant, infectious or radioactive, or regulated by
Environmental Laws, including, but not limited to, substances defined as
hazardous under the Comprehensive Environmental Response, Compensation and
Liability Act, as amended, 42 U.S.C. §9601 et seq., the Resource Conservation
and Recovery Act, as amended, 42 U.S.C. §6901 et seq. (or any state counterpart
to the foregoing statutes) or determined to present the unreasonable risk of
injury to health or the environment under the Toxic Substances Control Act, as
amended, 15 U.S.C. §2601 et seq. However, the following shall not be deemed to
be Hazardous Substances for purposes of this Lease: (i) components incorporated
in photocopying equipment; word processors; printers; telephone systems;
computers; scanners; facsimile machines; binders; televisions; refrigerators;
microwave ovens; or any similar or related equipment or systems now or hereafter
routinely employed in connection with general office use, and (ii) small
quantities of fluids, powders, toner and similar materials routinely used in the
operation thereof which are properly used, handled, stored in appropriate
containers and disposed of in accordance with any and all applicable Laws.

 

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Section 15.02. Restrictions on Tenant.

 

(a) Subject to the terms of this Lease (including, without limitation, this
Article 15), Tenant shall be permitted to make use and storage of the substances
listed on Exhibit G attached hereto and incorporated herein by reference, as
well as commercially reasonable amounts of materials customarily and commonly
used by similar businesses for the purposes of cleaning which are properly used,
handled, and stored in appropriate containers (all of the materials described
above in this sentence being sometimes herein referred to collectively as
“Permitted Hazardous Substances”), for purposes of its normal business
operations in the Leased Premises, but only to the extent that: (i) such
materials are in quantities normally used in Tenant’s business operations; (ii)
such materials are handled, stored and disposed of in accordance with all
applicable Laws (including, without limitation, all applicable Environmental
Laws); and (iii) a copy of the current safety data sheet (“SDS”) or material
safety data sheet (“MSDS”) is available for each of the Permitted Hazardous
Substances and for each product containing any Permitted Hazardous Substances.
Subject only to the terms of Section 15.02(c) and Article 20 of this Lease, but
notwithstanding anything else contained in this Lease to the contrary, in no
event shall Permitted Hazardous Substances include any materials or substances
if and to the extent that the use or presence thereof would (A) require a
physical change to the Leased Premises to comply with NFPA 30 Flammable and
Combustible Liquids Code or any other Environmental Laws; or (B) result in the
United States Environmental Protection Agency classifying the Leased Premises or
any portion of the Park as “Small or Large Quantity Generators.” As required by
Environmental Laws and fire regulations, Tenant shall keep an inventory of the
Permitted Hazardous Substances used and/or stored in or on the Leased Premises
and agrees to provide an updated inventory of such Permitted Hazardous
Substances upon request from Landlord. Notwithstanding the foregoing, all such
Permitted Hazardous Substances must be used, handled, stored in appropriate
containers and disposed of in accordance with all applicable Laws (including,
without limitation, all Environmental Laws) and all applicable safety standards
and practices prevailing in the industry in which Tenant is engaged.

 

(b) Except as expressly set forth in Section 15.02(a) above, Tenant shall not
cause or permit the presence, use, generation, release, manufacture, refining,
production, processing, storage or disposal of any Hazardous Substances on,
under or about the Leased Premises, the Building, the Common Areas or the Park,
or the transportation to or from the Leased Premises of any Hazardous
Substances.

 

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(c) Landlord reserves the right to inspect, take samples for testing, and
otherwise investigate the Leased Premises to verify Tenant’s compliance with the
terms of Section 15.02 (“Testing”), and may enter the Leased Premises for such
purposes, subject to Section 5.03 of this Lease, and provided that Landlord
shall give Tenant reasonable prior notice of any such Testing that would
reasonably be expected to impact Tenant’s business operations. So long as no
Default exists, Landlord shall use commercially reasonable efforts to minimize
any interference with Tenant’s business operations within the Leased Premises in
connection with any such entry into the Leased Premises and to comply, and cause
its employees, agents and subcontractors to comply, with all commercially
reasonable contractor and vendor guidelines relating to safety as reasonably
established by Tenant. If Tenant or its employees, agents or contractors violate
the provisions of this Article 15, or if Hazardous Substances brought onto the
Leased Premises are released by Tenant, then Tenant must, at its sole cost and
expense, undertake such corrective action and/or remediation activities,
including but not limited to the clean-up, removal, and/or disposal of such
Hazardous Substances, or undertake such other appropriate measures (e.g.,
install protective measures) with respect to any such Hazardous Substances on
the Leased Premises or the Park, as are reasonably deemed necessary by Landlord
to restore the Leased Premises to a condition substantially similar to that
prior to such violation or release of Hazardous Substances (“Corrective
Action”). Such Corrective Action must be performed in compliance with all
applicable governmental standards, laws, and rules, and regulations within such
period of time as may be prescribed thereby, or if there is no such prescribed
time period, within such period of time as may be reasonable under the
circumstances. If Tenant fails to promptly commence the required Corrective
Action, or fails to pursue such Corrective Action to completion, with diligence,
or if such Corrective Action is not actually completed within any time period
that may be prescribed therefor by any applicable governmental authority, or, if
there is no such prescribed time period, within such period of time as may be
reasonable under the circumstances, then Landlord shall have the right, but not
the obligation, to undertake the required Corrective Action after thirty (30)
days’ written notice to Tenant (or sooner if Landlord, in good faith, believes
that faster action is required to avoid or minimize legal liability to Landlord
or unreasonable risk to any tenant or occupant of the Park; provided that, in
such event, Landlord shall provide to Tenant as much advance notice as may be
reasonably practicable under the circumstances), and, in such event, Tenant
shall reimburse Landlord for all reasonable costs incurred by Landlord in
connection therewith within thirty (30) days after Landlord provides an invoice
to Tenant therefor.

 

(d) Notwithstanding anything herein to the contrary, on or before the expiration
or earlier termination of this Lease, Tenant must, at its sole cost and expense,
remove from the Leased Premises all Hazardous Substances brought to the Property
by or on behalf of Tenant, and all equipment and fixtures that have been in
contact with any such Hazardous Substances, and repair any and all damage to the
Leased Premises or Park caused by such removal. Within thirty (30) days after
any request by Landlord therefor, Tenant must deliver to Landlord a written
report from a registered professional engineer licensed in the State of Georgia
stating that he or she has inspected the Leased Premises, and confirmed that all
known Hazardous Substances used or released by Tenant, and Tenant’s equipment,
fixtures, and containers of any type containing Hazardous Substances, have been
removed from the Leased Premises. Tenant’s obligations under this Section
15.02(d) shall survive the expiration or earlier termination of this Lease.

 

Section 15.03. Notices, Representations, Etc. Tenant shall promptly: (a) notify
Landlord of: (i) any violation by Tenant, its employees, agents,
representatives, guests, customers, invitees or contractors of which Tenant is
aware of any Environmental Laws on, under or about the Leased Premises, the
Building, the Common Areas or the Park, or (ii) the presence or suspected
presence of any Hazardous Substances other than Permitted Hazardous Substances
of which Tenant is aware on, under or about the Leased Premises; and (b) deliver
to Landlord any notice received by Tenant relating to (a)(i) and (a)(ii) above
from any source. Tenant shall provide a written representation within five (5)
days of Landlord’s request therefor concerning Tenant’s best knowledge and
belief regarding the presence of any Hazardous Substances on, under or about the
Leased Premises.

 

Section 15.04. Tenant’s Indemnification. Tenant shall indemnify, defend and hold
harmless Landlord and Landlord’s managing agent from and against any and all
claims (including but not limited to claims by third parties and governmental
entities), losses, liabilities, costs, expenses, penalties and damages,
including, without limitation, attorneys’ fees, costs of testing and remediation
costs, to the extent arising from, relating to, in connection with, or caused in
whole or in part, directly or indirectly, by: (a) the discharge or release in or
from the Leased Premises or any portion thereof of Hazardous Substances by any
party other than Landlord or its employees, agents, or contractors; (b) the use,
generation, transportation, handling, presence, disposal, storage, release or
discharge of Hazardous Substances to, in, on, under, about or from the Building
Project or Park by Tenant, its directors, officers, agents, contractors,
employees or invitees (even if the use of such Hazardous Substances is
permissible under all applicable Environmental Laws and the provisions of this
Lease); (c) the failure by Tenant, its directors, officers, agents, contractors,
employees or invitees to comply with any Laws relating to Hazardous Substances
(including, without limitation, any Environmental Laws); or (d) by reason of any
failure of Tenant to keep, observe, or perform any provision of this Article 15.
Tenant further agrees to pay any and all fines, charges, assessments, fees,
damages, losses, claims, liabilities or response costs to the extent arising out
of or any way connected with the violation of any applicable Environmental Laws
by Tenant, its directors, officers, agents, contractors, employees or invitees.
The indemnifications set forth in this paragraph are in addition to any and all
other indemnification obligations of Tenant set forth in this Lease.

 

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Section 15.05. Existing Conditions. Notwithstanding anything contained in this
Article 15 to the contrary, Tenant shall not have any liability to Landlord
under this Article 15 resulting from any conditions existing, or events
occurring, or any Hazardous Substances existing or released, at, in, on, under,
to, from, or in connection with the Leased Premises prior to the Commencement
Date of this Lease (or any earlier occupancy of the Leased Premises by Tenant)
(“Existing Environmental Conditions”), except to the extent that Tenant or any
assignee or subtenant of Tenant, or any of their respective employees, agents,
contractors, representatives, guests, customers or invitees exacerbates the
same. Landlord represents to Tenant that, as of the date of execution of this
Lease by Landlord: (a) to its actual knowledge, the Leased Premises do not
contain any Hazardous Substances, the presence of which violates any
Environmental Laws currently applicable to the Project; and (b) except as may be
set forth in that certain Phase I Environmental Site Assessment, Lambert Farms
Phase II, dated March 28, 2017 by Contour Engineering provided by Landlord to
Tenant prior to the execution of this Lease (which Tenant acknowledges having
received and reviewed), Landlord has not received any notice from any
governmental body or third party regarding violations of, or noncompliance with,
any Environmental Laws with respect to the Building.

 

Section 15.06. Landlord’s Indemnification. Landlord shall indemnify, defend and
hold Tenant harmless from and against any and all claims (including but not
limited to claims by third parties and governmental entities), losses,
liabilities, costs, penalties and damages, including without limitation,
consultants’ fees, experts’ fees, attorneys’ fees, costs of testing and
remediation costs, to the extent arising from or caused in whole or in part,
directly or indirectly by the storage, handling, treatment, release, disposal,
presence or use of Hazardous Substances in, on or about the Leased Premises, the
Building or Park in violation of Environmental Laws by Landlord, its agents,
employees or contractors. The indemnifications set forth in this paragraph are
in addition to any and all other indemnification obligations of Landlord set
forth in this Lease.

 

Section 15.07. Interpretation. The obligations imposed upon Tenant under this
Article 15 are in addition to and are not intended to limit, but to expand upon,
the obligations imposed upon Tenant under Article 5 above.

 

Section 15.08. Survival. The covenants and obligations under this Article 15
shall survive the expiration or earlier termination of this Lease.

 

ARTICLE 16 - MISCELLANEOUS

 

Section 16.01. Benefit of Landlord and Tenant. Subject to Article 11 of this
Lease, this Lease shall inure to the benefit of and be binding upon Landlord and
Tenant and their respective successors and assigns.

 

Section 16.02. Governing Law. This Lease shall be governed by and construed in
accordance with the laws of the jurisdiction where the Building is located.

 

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Section 16.03. Force Majeure. Each of Landlord and Tenant shall be excused for
the period of any delay in the performance of any obligation hereunder when such
delay is occasioned by causes beyond its control, including, but not limited to,
work stoppages, boycotts, slowdowns or strikes; epidemics or pandemics;
shortages of materials, equipment, labor or energy; unusual weather conditions;
or acts, omissions or delays of actions of governmental or political bodies (any
such occurrence herein referred to as “Force Majeure”); provided nothing in this
Lease (including, without limitation, this Section 16.03) shall be deemed to
excuse, delay, or extend the time for performance of any of Tenant’s obligations
to pay Rent or any other sums to be paid by Tenant hereunder.

 

Section 16.04. Examination of Lease. Submission of this instrument by Landlord
to Tenant for examination or signature does not constitute an offer by Landlord
to lease the Leased Premises. This Lease shall become effective, if at all, only
upon the execution by and delivery to both Landlord and Tenant. Execution and
delivery of this Lease by Tenant to Landlord constitutes an offer to lease the
Leased Premises on the terms contained herein.

 

Section 16.05. Indemnification for Leasing Commissions. Each of Landlord and
Tenant hereby represents and warrants that the only real estate brokers involved
in the negotiation and execution of this Lease are the Brokers and that no other
party is entitled, as a result of its actions, to a commission or other fee
resulting from the execution of this Lease. Each of Landlord and Tenant shall
indemnify the other from any and all liability for the breach of this
representation and warranty on its part and shall pay any compensation to any
other broker or person who may be entitled thereto. Landlord shall pay any
commissions due the Brokers based on this Lease pursuant to separate agreements
between Landlord and Brokers.

 

Section 16.06. Notices. Except for legal process, which may also be served in
accordance with Laws, any notice or communication required or permitted
hereunder shall be in writing and shall be sent by: (a) personal delivery
service with charges therefor billed to shipper; (b) nationally recognized
overnight delivery service (such as Federal Express, United Parcel Service,
Airborne, etc.) with charges therefor billed to shipper; or (c) United States
Mail, postage prepaid, registered or certified mail, return receipt requested.
Any notice or communication sent as above provided shall be deemed given or
delivered: (i) upon receipt, if personally delivered (provided delivery is
confirmed by the courier delivery service); (ii) on the date of delivery by any
nationally recognized overnight delivery service; or (iii) if sent by United
States Mail, on the date appearing on the return receipt therefor, or if there
is no date on such return receipt, the receipt date shall be presumed to be the
postmark date appearing on such return receipt. Notice shall be considered given
and received on the latest original delivery or attempted delivery date to all
persons and addresses to which notice is to be given, as indicated on the return
receipt(s) of the United States Mail or delivery receipts of the personal
delivery service or nationally recognized overnight delivery service. Any notice
or communication which cannot be delivered because of failure to provide notice
of a change of address as herein provided or for which delivery is refused shall
be deemed to have been given and received on the date of attempted delivery. Any
notice or communication required or permitted hereunder shall be addressed to
Landlord or Tenant (as applicable) at the address(es) for such party set forth
in Article 1 of this Lease, or at such other addresses as Landlord or Tenant may
have designated by notice to the other given as provided above. Tenant shall not
designate an address for notices which is outside the Continental United States.
Any notice address designated by Tenant shall contain a street address, city,
state and ZIP code.

 

Section 16.07. Partial Invalidity; Complete Agreement. If any provision of this
Lease shall be held to be invalid, void or unenforceable, the remaining
provisions shall remain in full force and effect. This Lease represents the
entire agreement between Landlord and Tenant covering everything agreed upon or
understood in this transaction. There are no oral promises, conditions,
representations, understandings, interpretations or terms of any kind as
conditions or inducements to the execution hereof or in effect between the
parties. No change or addition shall be made to this Lease except by a written
agreement executed by Landlord and Tenant.

 

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Section 16.08. Financial Statements. During the Lease Term and any extensions
thereof, Tenant shall provide to Landlord on an annual basis, within ninety (90)
days following the end of Tenant’s fiscal year, a copy of Tenant’s most recent
financial statements prepared as of the end of Tenant’s fiscal year. Such
financial statements shall be signed by Tenant or an officer of Tenant, if
applicable, who shall attest to the truth and accuracy of the information set
forth in such statements, or if the Minimum Annual Rent hereunder exceeds
$100,000.00, said statements shall be either be certified by Tenant’s chief
financial officer or audited. All financial statements provided by Tenant to
Landlord hereunder shall be prepared in conformity with generally accepted
accounting principles, consistently applied. Notwithstanding anything contained
in this Section 16.08 to the contrary, Landlord shall have no right to require
Tenant to provide any information that is then publicly available.

 

Section 16.09. Representations and Warranties.

 

(a) Tenant hereby represents and warrants that: (i) Tenant is duly organized,
validly existing and in good standing (if applicable) in accordance with the
laws of the jurisdiction under which it was organized; (ii) Tenant is authorized
to do business in the jurisdiction where the Building is located; and (iii) the
individual(s) executing and delivering this Lease on behalf of Tenant has been
properly authorized to do so, and such execution and delivery shall bind Tenant
to its terms.

 

(b) Landlord hereby represents and warrants that: (i) Landlord is duly
organized, validly existing and in good standing (if applicable) in accordance
with the laws of the jurisdiction under which it was organized; (ii) Landlord is
authorized to do business in the jurisdiction where the Building is located; and
(iii) the individual(s) executing and delivering this Lease on behalf of
Landlord has been properly authorized to do so, and such execution and delivery
shall bind Landlord to its terms.

 

Section 16.10. Rights Reserved by Landlord. Landlord shall also have the
following rights, exercisable without notice and without liability to Tenant for
damage or injury to property, person or business and without effecting any
eviction, constructive or actual, or disturbance of Tenant’s use or possession
of the Leased Premises or giving rise to any claim for setoff or abatement of
Rent:

 

(a) To designate and approve, prior to installation, all window shades, blinds,
drapes, awnings, window ventilators, lighting and other similar equipment to be
installed by Tenant that may be visible from the exterior of the Leased Premises
or the Building.

 

(b) To decorate or make repairs, alterations, additions or improvements, whether
structural or otherwise, in and about the Building, or any part thereof,
including, but not limited to, the installation of a sprinkler system and
sprinkler heads, and for such purposes to enter the Leased Premises (subject to
Section 5.03 of this Lease) and, during the continuance of any such work, to
temporarily close doors, entry ways, common or public spaces and corridors in
the Building and interrupt or temporarily suspend Building services and
facilities, all without affecting any of Tenant’s obligations hereunder, so long
as the Leased Premises are reasonably accessible. So long as no Default exists,
Landlord shall use commercially reasonable efforts to minimize any interference
with Tenant’s business operations within the Leased Premises in connection with
any entry into the Leased Premises hereunder.

 

(c) To grant to anyone the exclusive right to conduct any business or render any
service in the Building, provided Tenant is not thereby excluded from uses
expressly permitted herein.

 

37

 

 

(d) To alter, relocate, reconfigure and reduce and withdraw the Common Areas, as
long as the Leased Premises remain reasonably accessible.

 

(e) To erect, use and maintain pipes and conduits in and through the Leased
Premises.

 

(f) To operate and maintain, or cause to be operated and maintained, the Common
Areas in a manner deemed by Landlord to be reasonable and appropriate and in the
best interest of the Building, but all Common Areas shall be subject to the
exclusive control and management of Landlord.

 

Section 16.11. Time. Time is of the essence of each term and provision of this
Lease.

 

Section 16.12. Anti-Corruption Laws and Sanctions. For purposes hereof, (a)
“Anti-Corruption Laws” shall mean all Laws applicable to a pertinent party from
time to time concerning or relating to bribery or anti-corruption; (b)
“Sanctions” shall mean all applicable economic or financial sanctions or trade
embargoes imposed, administered or enforced from time to time by (i) the U.S.
federal government, including those administered by the Office of Foreign Assets
Control, the United States Department of Treasury (“OFAC”) or the U.S.
Department of State, or (ii) the United Nations Security Council, the European
Union, any European Union member state in which a pertinent party or any of its
subsidiaries conduct operations or Her Majesty’s Treasury of the United Kingdom;
and (c) “Sanctioned Person” shall mean, at any time, (i) any person or entity
listed in any Sanctions-related list of designated persons or entities
maintained by OFAC, the U.S. Department of State, or by the United Nations
Security Council, the European Union or any European Union member state in which
the pertinent party or any of its subsidiaries conducts operations, (ii) unless
otherwise authorized by OFAC, any person or entity operating, organized or
resident in any country or territory which is itself the subject or target of
any full-scope (non-list based) Sanctions, or (iii) any ownership of fifty
percent (50%) or more of an entity by persons or entities described in the
foregoing clauses (i) or (ii). Each of Landlord and Tenant represents and
warrants that neither it nor any of its subsidiaries, nor to its knowledge,
their respective directors, officers, employees or agents, is a Sanctioned
Person. Each party further represents that it and its subsidiaries, and to its
knowledge, their respective directors, officers, employees and agents, complies
and shall continue to comply in all material respects with all Sanctions and
with all Anti-Corruption Laws. Each party will use reasonable efforts to notify
the other in writing if any of the foregoing representations and warranties are
no longer true or have been breached or if such party has a reasonable basis to
believe that they may no longer be true or have been breached. In the event of
any violation of this Section by Tenant, Landlord will be entitled to
immediately terminate this Lease and take such other actions as are permitted or
required to be taken under law or in equity.

 

Section 16.13. Cooperation. Tenant shall use reasonable efforts to cooperate
with Landlord, without cost to Tenant, in connection with the completion of any
written surveys or evaluations relating to the Building, the Park or Landlord.

 

Section 16.14. Usufruct. This Lease shall create the relationship of landlord
and tenant between Landlord and Tenant; no estate shall pass out of Landlord.
Tenant’s interest in the Leased Premises is a usufruct, not subject to levy and
sale, and not assignable by Tenant except as expressly set forth herein.

 

Section 16.15. Terminology. 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.

 

Section 16.16. 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.

 

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Section 16.17. Survival. All obligations of Tenant hereunder not fully performed
as of the expiration of the Lease Term or earlier termination thereof shall
survive the expiration or earlier termination of the Lease Term, including,
without limitation, all payment obligations with respect to Rent and all
obligations concerning the condition of the Leased Premises.

 

Section 16.18. Restrictions of Record. Tenant agrees to comply with subdivision
regulations, protective covenants or other restrictions of record that are
applicable to the Building or Park.

 

Section 16.19. No Representations. Neither Landlord nor Landlord’s agents or
brokers have made any representations, warranties or promises with respect to
the Premises, the Building, or any other portions of the Park except as herein
expressly set forth and all reliance with respect to any representations,
warranties or promises is based solely on those contained herein. No rights,
easements or licenses are acquired by Tenant under this Lease by implication or
otherwise except as, and unless, expressly set forth in this Lease.

 

Section 16.20. No Easement for Light, Air or View. Any elimination or shutting
off of light, air or view by any structure which may be erected on lands
adjacent to the Building shall in no way affect this Lease and Landlord shall
have no liability to Tenant with respect thereto.

 

Section 16.21. Electronic Signatures. The parties hereby acknowledge and agree
that electronic signatures, facsimile signatures or signatures transmitted by
electronic mail in so-called “pdf” format shall be legal and binding and shall
have the same full force and effect as if an original of this Lease had been
delivered. Landlord and Tenant (a) intend to be bound by the signatures (whether
original, faxed or electronic) on any document sent by facsimile or electronic
mail, (b) are aware that the other party will rely on such signatures, and (c)
hereby waive any defenses to the enforcement of the terms of this Lease based on
the foregoing forms of signature.

 

Section 16.22. Indemnity Limitation. Notwithstanding anything contained in this
Lease (including, without limitation, any exhibit or rider attached hereto) to
the contrary, in no event shall any indemnity or hold harmless obligation of
Tenant set forth in this Lease apply to any damage, injury, loss, claim, cause
of action, liability, cost or expense caused by or resulting from the sole
negligence of Landlord.

 

ARTICLE 17 – RIGHT OF FIRST REFUSAL

 

Subject to the terms of this Article 17, Tenant shall have a one-time right of
first refusal (“First Refusal Right”) to lease any space in the Building
contiguous to the Leased Premises (subject to Section 17.06 below, the “First
Refusal Space”).

 

Section 17.01. First Refusal Notice.

 

(a) If, at any time after the date that is twelve (12) months after the
Effective Date (the “First Refusal Right Effective Date”), the First Refusal
Space, or a portion thereof, becomes available, and Landlord has an offer or
proposal to lease all or part of such First Refusal Space from a “bona fide”
prospect that is not affiliated with or controlled by or under common control
with Landlord (the “Prospect”) which Landlord is willing to accept, Landlord
shall deliver written notice to Tenant (the “First Refusal Notice”) of the
availability of such portion of the First Refusal Space. The First Refusal
Notice shall specify the approximate location and square footage of the portion
of the First Refusal Space which has or will become available, the proposed
Lease Term and the proposed Minimum Annual Rent and Monthly Rental Installments
and other economic terms for the lease of such space, which proposed Lease Term,
Base Rent and other economic terms shall be the Lease Term, Minimum Annual Rent
and Monthly Rental Installments and other economic terms agreed upon with the
Prospect. If the Prospect is interested in combining all or part of the First
Refusal Space with other space in the Building, Landlord shall also specify such
additional space in its First Refusal Notice to Tenant. The portion of the First
Refusal Space, plus such additional space, if any, is hereinafter referred to as
the “Offered Space.”

 

39

 

 

(b) Tenant shall have seven (7) business days from its receipt of the First
Refusal Notice to notify Landlord in writing that Tenant desires to lease the
Offered Space. If Tenant does so exercise its First Refusal Right by notifying
Landlord within such seven (7) business day period, the Offered Space shall be
added to the Leased Premises in accordance with the provisions of this Article
17. If Tenant does not exercise such First Refusal Right or fails to notify
Landlord within such seven (7) business day period of its election, Landlord
shall thereafter have the right to lease that portion of the First Refusal Space
to any prospective tenant on any terms and conditions not “materially less
favorable” to Landlord (as defined below). However, if Landlord desires to enter
into a lease for such portion of the First Refusal Space on terms and conditions
which are “materially less favorable” to Landlord than those set forth in the
First Refusal Notice, then Landlord may not enter into such lease without again
complying with the provisions of this First Refusal Right. If Landlord leases
such portion of the First Refusal Space on terms and conditions which are not
“materially less favorable to Landlord” than those set forth in the First
Refusal Notice, this First Refusal Right shall expire and be of no further force
and effect as to such portion of the First Refusal Space. For purposes of this
Section 17.01(a), the phrase “materially less favorable” shall mean a proposed
lease in which the proposed effective rental rate is less than ninety percent
(90%) of the effective rental rate set forth in the First Refusal Notice.

 

Section 17.02. Terms. If Tenant exercises any First Refusal Right, the
Commencement Date, Lease Term, Minimum Annual Rent and Monthly Rental
Installments and other economic terms of the Lease for the Offered Space shall
be the Commencement Date, Lease Term, Minimum Annual Rent and Monthly Rental
Installments and economic terms specified by Landlord in the First Refusal
Notice. All other terms and conditions for the lease of such Offered Space shall
be those terms, covenants, agreements, provisions and conditions then in effect
under the Lease at the Commencement Date for such Offered Space (exclusive of
tenant improvement allowances, space planning allowances, refurbishment
allowances, other allowances, rent abatements, and other concessions granted in
connection with the lease by Tenant of any space other than the Offered Space).

 

Section 17.03. Addition to Leased Premises. After the Commencement Date for any
Offered Space leased pursuant to this First Refusal Right, such Offered Space
shall be added to and form a part of the Leased Premises with the same force and
effect as if originally demised under this Lease, and the term “Leased
Premises,” as used in this Lease, shall include such Offered Space.

 

Section 17.04. Tenant’s Proportionate Share. The term “Tenant’s Proportionate
Share,” as such term is used and defined in the Lease, and as such term is used
to determine the Annual Rental Adjustment, shall be increased after the
Commencement Date for any Offered Space to reflect the additional rentable
square footage of such Offered Space and Tenant’s payment obligations under
Article 3 of this Lease shall be adjusted accordingly.

 

Section 17.05. Lease Amendment. Upon exercise of the First Refusal Right by
Tenant, and the determination of the Minimum Annual Rent and Monthly Rental
Installments and other economic terms with respect thereto, Landlord and Tenant,
upon demand of either of them, shall enter into an amendment to this Lease
adding such Offered Space to the Leased Premises, setting forth such Minimum
Annual Rent and Monthly Rental Installments, and setting forth Tenant’s
Proportionate Share after the addition of such Offered Space to the Leased
Premises, provided that failure to enter into any such amendment shall not
affect Tenant’s obligation to pay Base Rent and the Annual Rental Adjustment for
such Offered Space. If Tenant properly exercises a First Refusal Right but
thereafter, for any reason (except for delays caused by Landlord), does not
enter into an amendment to this Lease adding such Offered Space to the Leased
Premises within ten (10) days after Tenant notifies Landlord in writing that
Tenant desires to lease the Offered Space, Landlord shall have the option, by
written notice to Tenant, to elect to cancel Tenant’s exercise of its First
Refusal Right, and, if Landlord so elects, Landlord will be free to rent such
Offered Space to any other prospective tenant and the First Refusal Right
granted to Tenant under this Article 17 shall immediately expire and be of no
further force or effect and Tenant shall have no further rights, and Landlord
shall have no further obligations, under this Article 17.

 

40

 

 

Section 17.06. Limitations. Notwithstanding anything contained herein to the
contrary: (a) the termination, cancellation or surrender of this Lease shall
terminate any rights of Tenant pursuant to this Article 17; (b) this First
Refusal Right is provided to Tenant for the exclusive benefit of Tenant and
shall terminate upon the sublease of all or any portion of the Leased Premises
or upon any assignment of this Lease; (c) Tenant’s rights under this Article 17
shall expire upon expiration of the original Lease Term unless Tenant exercise
its option to renew the Lease Term under Article 18 below, in which event this
First Refusal Right shall remain in effect during the applicable Renewal Term
(subject to all other limitations set forth in this Article 17); and (d) Tenant
shall not be entitled to exercise a First Refusal Right if, at the time of the
exercise of the First Refusal Right, there exists a Default under this Lease, or
a situation which, with the giving of notice or the passage of time, or both,
would constitute a Default. In addition, and notwithstanding anything contained
herein to the contrary: (i) Landlord shall be permitted to lease space in the
Building to any party at any time prior to the First Refusal Right Effective
Date without triggering this First Refusal Right or being required to notify
Tenant thereof or to offer the applicable space to Tenant under this First
Refusal Right; and (ii) any space leased by Landlord prior to the First Refusal
Right Effective Date shall be excluded from the First Refusal Space.

 

Section 17.07. Existing Tenants. Notwithstanding any other term or provision of
this Lease or this Article 17, express or implied, it is understood and agreed
by Tenant that: (a) Tenant’s rights under this Article 17 may be subject and
subordinate to existing third party leases in effect with one or more tenants
for the First Refusal Space or a portion thereof as of the Commencement Date of
this Lease, and Landlord reserves the right to extend the lease expiration date
of, or renew, any such third party lease, whether pursuant to the exercise of
any extension or renewal option, or otherwise; (b) other tenants do have and may
have certain rights of first offer, rights of refusal or other expansion rights
or options with respect to space in the Building, including the First Refusal
Space [the tenants referred to in clauses (a) and (b) of this Section 17.07,
together with their respective successors, assigns and subtenants, are herein
referred to as “Existing Tenants”]; (c) the rights and interests in and to the
First Refusal Space and all portions thereof granted by Landlord to Tenant in
this Article 17 are, in all respects, subject and subordinate to all such
options and rights of Existing Tenants, and to the rights Landlord has reserved
with respect to Existing Tenants and may be wholly or partially rendered void
and of no effect by such options, rights of and reservations with respect to
Existing Tenants; (d) Landlord shall not be liable for the failure or inability
of Tenant to exercise or benefit from any or all rights granted in this Article
17 with respect to the First Refusal Space or any portion thereof by reason of
the rights Landlord has reserved with respect to the Existing Tenants or such
rights and options of Existing Tenants; and (e) Tenant shall not be entitled to
compensation, consolation, consideration, replacement of such space or any
remedy from or against Landlord by reason of such failure or inability. Landlord
shall not be liable for any failure to give possession of any portion of the
First Refusal Space by reason of the unlawful holding over or retention of
possession of any previous tenant, tenants or occupants of same, nor shall such
failure impair the validity of this Lease or extend the Lease Term. However,
Landlord does agree to use reasonable diligence to deliver possession of the
applicable First Refusal Space to Tenant upon the dates described herein.

 

41

 

 

ARTICLE 18 – RENEWAL OPTIONS

 

Subject to the terms of this Article 18, Tenant shall have the option to renew
the Lease Term for two (2) additional terms of five (5) years each (each a
“Renewal Term”), provided that in each instance, Tenant gives Landlord written
notice of the exercise thereof for each Renewal Term no less than nine (9)
months and no more than eighteen (18) months prior to the end of the Lease Term
then in effect. The Minimum Annual Rent and Monthly Rental Installments payable
during the Renewal Terms shall be as follows:

 

(a) The Minimum Annual Rent and Monthly Rental Installments payable during the
first Renewal Term shall be calculated based on the applicable per square foot
per annum rates set forth in the following schedule:

 

Renewal Term Year  Per Square Foot
Per Annum  First  $4.24  Second  $4.32  Third  $4.41  Fourth  $4.50  Fifth 
$4.59 

 

(b) The Minimum Annual Rent and Monthly Rental Installments payable during the
second Renewal Term shall be calculated based on the applicable per square foot
per annum rates set forth in the following schedule:

 

Renewal Term Year  Per Square Foot
Per Annum  First  $4.75  Second  $4.92  Third  $5.09  Fourth  $5.27  Fifth 
$5.45 

 

Each Renewal Term shall commence at 12:01 a.m. Atlanta, Georgia, time on the
first day following the expiration of the immediately preceding original Lease
Term or first Renewal Term, as applicable. During the Renewal Terms, all
provisions of this Lease shall apply, except that the Minimum Annual Rent and
Monthly Rental Installments shall be as set forth above, and except that any
provision relating to the Landlord’s Work shall not apply. Notwithstanding
anything contained herein to the contrary, Tenant shall have no right to extend
the Lease Term unless this Lease shall, at that time, be in full force and
effect, and no Default shall then exist.

 

ARTICLE 19 – CONFIDENTIALITY

 

Each of the parties to this Lease shall maintain and keep this Lease and each of
its terms in the strictest confidence and shall not disclose any aspect of this
Lease to any third person, except as required by law (including, without
limitation, as may be required of either party by the U.S. Securities and
Exchange Commission) or as reasonably required by either party’s officers,
managing agent, asset manager, attorneys, consultants, brokers, lenders,
prospective lenders, and prospective purchasers, and to those persons employed
by such parties who reasonably have a need to know such information for purposes
relating to this Lease (and to each such person’s assistants and secretaries).
The parties possess confidential and proprietary information, including, but not
limited to, corporate and financial information pertaining to or concerning the
Leased Premises, the Building, and the Park and the business of each party and
agree to keep such information confidential, except as set forth above.

 

42

 

 

ARTICLE 20 – OIL TANKS

 

Subject to the terms of this Lease, Tenant shall be permitted to install oil
tanks within the area outside of the Building shown on Exhibit H-1 attached
hereto and made a part hereof (the “Oil Tank Area”). Landlord has approved the
plans for such oil tanks set forth on Exhibit H-2 attached hereto and made a
part hereof. Except as set forth in Exhibit H-2, all aspects of such oil tanks,
and of all associated installations and improvements, including, without
limitation, the method of connection of such tanks to the Leased Premises, shall
be subject to Landlord’s prior written approval, not to be unreasonably withheld
(except as to aesthetic matters, in which case Landlord’s approval may be
granted or withheld in its sole and absolute discretion). All such installations
shall be performed in accordance with and subject to the terms of Section 7.03
of this Lease. In no event shall any Hazardous Substance other than Permitted
Hazardous Substances ever be stored in such oil tanks. Landlord shall have the
right to prescribe rules and regulations relating to the access and use of such
tanks, and Tenant shall comply therewith. The Oil Tank Area shall be treated as
part of the Leased Premises for all purposes of this Lease, except that: (a) no
Minimum Annual Rent shall be assessed against such space and the area of such
space will not be considered when calculating the Rentable Area of the Leased
Premises or Tenant’s Proportionate Share; and (b) the Oil Tank Area shall not be
treated as part of the Leased Premises for purposes of determining the location
of the First Refusal Space (i.e., space outside the Building that is contiguous
to the Oil Tank Area shall not be deemed to be First Refusal Space). Without
limiting the generality of the foregoing, Tenant shall be solely responsible, at
its sole cost and expense, for maintaining the Oil Tank Area, and the oil tanks
and all installations and improvements therein, in good order and condition,
including, without limitation, performing all repairs and replacements that may
be necessary for such purpose. Notwithstanding anything contained in this Lease
to the contrary, on or before the expiration or earlier termination of this
Lease, Tenant shall remove the oil tanks and all associated installations and
improvements, and shall repair all damage to the Building Project resulting from
the installation or removal of such oil tanks. If Tenant fails to timely
complete its removal and repair obligations, Landlord may perform such work,
and, in such event, Tenant shall reimburse Landlord for all costs incurred by
Landlord in connection therewith within ten (10) days after receipt of an
invoice therefor. Tenant’s obligations under this Article 20 shall survive the
expiration or earlier termination of this Lease.

 

ARTICLE 21 – TAX INCENTIVES

 

(a) In connection with this Lease, Tenant is attempting to achieve certain tax
incentives from Henry County (the “Purple Incentives”), which incentives, if
achieved, will reduce the Real Estate Taxes assessed against the Building
Project. Landlord is cooperating with such efforts by Tenant. In order to obtain
the Purple Incentives, Landlord may be required to enter into a so-called “bonds
for title” or other transaction with Henry County or an instrumentality of Henry
County. Tenant shall reimburse Landlord for all costs and expenses incurred by
Landlord in connection with such transaction or otherwise in connection with
Landlord’s cooperation with Tenant to achieve the Purple Incentives (including,
without limitation, attorneys’ fees incurred by Landlord in connection
therewith) within ten (10) days after receipt of an invoice from Landlord
therefor. Tenant’s reimbursement obligations under this Article 21 shall survive
the expiration or any earlier termination of this Lease.

 

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(b) If the Purple Incentives are achieved, Tenant will be entitled to receive
the entire benefit of the Purple Incentives (meaning that, for every dollar that
Real Estate Taxes assessed against the Building Project are reduced below the
amount that would have been payable in the absence of the Purple Incentives, the
amount payable by Tenant as Tenant’s Proportionate Share of Operating Expenses
for the relevant period will be reduced by $1.00), and Landlord agrees to take
no action to prevent Tenant from receiving the entire benefit of the Purple
Incentives, as described above.  However, the parties acknowledge that such
reduction in Real Estate Taxes under this subparagraph (b) shall be granted only
with respect to the Purple Incentives and not to any other incentives or other
tax reductions or abatements that may now or hereafter be granted in connection
with other tenant, or any other lease or leases, at the Park (collectively,
“Unrelated Incentives”).  If any such Unrelated Incentives are granted, then,
notwithstanding anything contained in this Lease to the contrary, for purposes
of calculating amounts due as Tenant’s Proportionate Share of Operating
Expenses, Real Estate Taxes shall be calculated as if such Unrelated Incentives
did not exist.

 

(c) The parties acknowledge that, in connection with the Purple Incentives,
Tenant may be required to file annual reports with Henry County or an
instrumentality thereof and pay annual fees. Tenant shall provide Landlord with
a copy of each annual report at the time Tenant submits such report to Henry
County or an instrumentality of Henry County. Notwithstanding anything contained
in this Lease to the contrary, if Tenant fails to timely pay any fees or timely
provide or submit any information or a report called for under the documents
governing the Purple Incentives, or fails to provide any information concerning
the tax incentives (or relevant to Landlord’s calculation of Tenant’s
Proportionate Share of Real Estate Taxes) requested by Landlord, and if such
failure continues for more than five (5) business days after notice of such
failure from Landlord, then such failure shall be deemed to be a Default under
this Lease.

 

ARTICLE 22 – LIMITATION OF LANDLORD’S LIABILITY

 

ANYTHING CONTAINED IN THIS LEASE TO THE CONTRARY NOTWITHSTANDING, TENANT SHALL
LOOK SOLELY TO THE ESTATE AND PROPERTY OF LANDLORD IN THE BUILDING FOR THE
COLLECTION OF ANY JUDGMENT OR OTHER JUDICIAL PROCESS REQUIRING THE PAYMENT OF
MONEY BY LANDLORD FOR ANY DEFAULT OR BREACH BY LANDLORD UNDER THIS LEASE,
SUBJECT, HOWEVER, TO THE PRIOR RIGHTS OF ANY MORTGAGEE OR LESSOR OF THE
BUILDING. NO OTHER ASSETS OF LANDLORD OR ANY PARTNERS, SHAREHOLDERS, MEMBERS OR
OTHER PRINCIPALS OF LANDLORD SHALL BE SUBJECT TO LEVY, EXECUTION OR OTHER
JUDICIAL PROCESS FOR THE SATISFACTION OF TENANT’S CLAIM.

 

IN WITNESS WHEREOF, the parties hereto have executed this Lease as of the day
and year first above written.

 

  LANDLORD:       PNK S2, LLC., a Georgia limited liability company       By:
/s/ Park Mun Sgong   Name:  Park Mun Sgong   Title: Manager

  

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  TENANT:       PURPLE INNOVATION, LLC, a Delaware limited liability company    
  By: /s/ John Legg        Name: John Legg   Title: COO

 

45

 

 

EXHIBIT A-1

 

SITE PLAN OF LEASED PREMISES

  

 [ex10-3_001.jpg]

  

Exhibit A-1
Page 1 of 1

 

 

EXHIBIT A-2

 

LOCATION OF BUILDING

 

 [ex10-3_002.jpg]

 

Exhibit A-2
Page 1 of 1

 

 

EXHIBIT A-3

 

LAND

 

 [ex10-3_003.jpg]

 

Exhibit A-3
Page 1 of 4

 

 

 [ex10-3_004.jpg]

 

Exhibit A-3
Page 2 of 4

 

 

 [ex10-3_005.jpg]

 

Exhibit A-3
Page 3 of 4

 

  

 [ex10-3_006.jpg]

 

Exhibit A-3
Page 4 of 4

 

  

EXHIBIT B

 

WORK LETTER

 

(Landlord Construction; Tenant Improvement Allowance)

 

This Work Letter (the “Work Letter”) sets forth the terms and conditions
relating to the construction of the Landlord Work by Landlord in the Leased
Premises, as set forth in the attached Lease, dated ___________________ (the
“Lease”), between PNK S2, LLC, a Georgia limited liability company (“Landlord”),
and Purple Innovation, LLC, a Delaware limited liability company (“Tenant”).
This Work Letter shall become effective and binding on Landlord and Tenant upon
the execution and delivery of the Lease.

 

ARTICLE 1

 

DEFINITIONS

 

Except as otherwise set forth herein, each of the capitalized terms appearing in
this Work Letter shall have the meaning ascribed to it in the Lease., and the
following defintions shall have the meanings set forth below with respect to
this Work Letter:

 

1.01 “Approved Construction Drawings” means the Construction Drawings approved
or deemed approved by Landlord pursuant to the process set forth in Article 2
below.

 

1.02 “Approved Space Plan” means the Space Plan approved by Landlord pursuant to
the process set forth in Article 2 below.

 

1.03 “Base Building” consists of those portions of the Leased Premises which
were in existence prior to the execution of the Lease.

 

1.04 “Building Standard” means the quantity and quality of materials, finishes,
and workmanship from time to time specified as such by Landlord for the
Building, in its discretion.

 

1.05 “Change Order” means any change, modification or addition to the Approved
Construction Drawings.

 

1.06 “Construction Drawings” means: (a) detailed architectural drawings and
specifications for Tenant’s partition plan, demolition plan, reflected ceiling
plan, power, communication and telephone plan (location of data and telephone
outlets with pull boxes only), electrical outlets, finish plan, elevations,
details and sections; and (b) mechanical, electrical, plumbing and lighting
plans and specifications where necessary for installation to Building systems.

 

1.07 “Contractor” means the contractor selected under Section 2.02 below and
approved by Landlord and Tenant.

 

1.08 “Landlord’s Representative” means any representative of PNK S2, LLC, or of
any third part retained by Landlord, who Landlord designates as its
representative with respect to the matters set forth in this Work Letter. Such
individual shall, until further notice to Tenant, have full authority and
responsibility to act on behalf of Landlord as required in this Work Letter.

 

1.09 “Landlord’s Work” means all work required by the Approved Construction
Drawings.

 

1.10 “Non-Building Standard” means all materials, finishes, and workmanship used
in connection with the construction and installation of the Landlord’s Work
which deviate from Building Standard in terms of quantity or quality (or both).

 

Exhibit B
Page 1 of 7

 

 

1.11 “Punch List” shall refer to that list determined by Landlord’s Construction
Coordinator and Tenant of those matters remaining to be accomplished or
corrected to complete construction of Landlord’s Work once Substantial
Completion of Landlord’s Work has been accomplished. 1.12 “Space Plan” means a
preliminary architectural drawing showing all demising walls, corridors,
entrances, exits, doors and interior partitions.

 

1.13 “Space Planner” means the space planner selected by Landlord.

 

1.14 “Substantial Completion” shall occur when the Landlord’s Work has been
substantially completed in accordance with the Approved Construction Drawings
(other than minor Punch List items and any work which cannot be completed on
such date, provided such incompletion will not substantially interfere with
Tenant’s use of the Leased Premises) and, if required for occupancy, a
Certificate of Occupancy (temporary or final) has been issued by the appropriate
governmental authority. Substantial Completion shall occur in accordance with
the preceding sentence, notwithstanding the fact that: (a) the matters on the
Punch List remain to be completed; (b) telephone, data and other equipment and
finish work to be installed by or for Tenant has not been completed; and (c)
there are other items which have not been completed as of such date, provided
the incompletion of such other items will not substantially interfere with
Tenant’s use of the Leased Premises. In the event of any dispute as to
Substantial Completion of the Landlord’s Work, the Certificate of Occupancy
(temporary or final) issued by the appropriate governmental authority shall be
conclusive.

 

1.15 “Tenant Expenditure Authorization” or “T.E.A.” means an authorization by
Tenant to Landlord, prior to the commencement of Landlord’s Work by Landlord, to
expend funds on behalf of Tenant for Landlord’s Work, to be given in a written
form reasonably acceptable to Landlord.

 

1.16 “Tenant Improvement Allowance” means, subject to Section 3.01(b) below, the
allowance of $12.50 per square foot of Rentable Area of the Leased Premises (set
forth in Article 1 of the Lease) and a total of $6,496,000.00, to be provided by
Landlord as set forth in Section 3.01 below.

 

1.17 “Tenant’s Representative” means John Legg, who Tenant has designated as its
sole representative with respect to the matters set forth in this Work Letter,
and who, until further notice to Landlord, has full authority and responsibility
to act on behalf of Tenant as required in this Work Letter. Tenant’s
Representative is authorized to execute and deliver on behalf of Tenant any and
all documents required by this Work Letter and the Commencement Notice required
by the Lease.

 

ARTICLE 2

 

SCHEDULE

 

Landlord and Tenant hereby agree that time is of the essence and that the
sequence and schedule specified below shall be strictly adhered to with respect
to the design and development of the Space Plan, the Construction Drawings and
the construction of Landlord’s Work.

 

2.01 Space Plan. Tenant shall cause the Space Planner to submit the Space Plan
to Landlord for Landlord’s review and approval within thirty (30) days after the
Effective Date of the Lease. After Landlord receives the Space Plan, Landlord
shall approve or disapprove the Space Plan. If Landlord disapproves the Space
Plan, Landlord shall return the Space Plan to Tenant within five (5) business
days after its receipt thereof, along with a statement setting forth the grounds
for the disapproval. In such event, Tenant shall make such changes as are
necessary in order to make the Space Plan acceptable to Landlord and shall then
re-submit the revised Space Plan to Landlord. This procedure shall be repeated
until Landlord has delivered to Tenant written approval of the Space Plan. When
approved by Landlord, the Space Plan shall be deemed to be the Approved Space
Plan. If Landlord fails to disapprove or provide comments to the Space Plan
within such five-business-day period at any time during the approval process,
the Space Plan shall be deemed to have been disapproved by Landlord.

 

Exhibit B
Page 2 of 7

 

 

2.02 Construction Drawings; Bids; Selection of Contractor; T.E.A.

 

(a) Upon receipt of the Approved Space Plan, Tenant shall direct the Space
Planner to begin preparation of Construction Drawings. Tenant shall submit
Construction Drawings to Landlord for Landlord’s approval or disapproval. After
its receipt of such documents, Landlord shall notify Tenant in writing of its
approval or disapproval within five (5) business days after its receipt thereof,
stating in reasonable detail the reasons for any disapproval. If Landlord
disapproves the Construction Drawings, Tenant shall then resubmit revised
Construction Drawings to Landlord, and Landlord shall approve or disapprove the
revised Construction Drawings within five (5) business days after its receipt
thereof, stating in reasonable detail the reasons for any disapproval. The
foregoing process shall be repeated as many times as are necessary in order to
obtain Construction Drawings which are approved by Landlord. When approved by
Landlord, the Construction Drawings shall be deemed to be the Approved
Construction Drawings. If Landlord fails to disapprove or provide comments to
the Construction Drawings within such five-business-day period at any time
during the approval process, Landlord shall be deemed to have disapproved the
Construction Drawings.

 

(b) After Landlord’s receipt of the Approved Construction Drawings, Landlord
shall within five (5) business days thereafter submit the Approved Construction
Drawings to three (3) contractors on Landlord’s approved list and shall use
commercially reasonable efforts to obtain bids as soon as reasonably possible
thereafter for constructing Landlord’s Work in accordance with the Approved
Construction Drawings. The parties shall mutually select the Contractor from
among the companies submitting such bids. If Tenant requests in writing that
Landlord approve any particular party to serve as the Contractor, and if
Landlord fails to respond within five (5) business days, Landlord shall be
deemed to have disapproved Tenant’s request. When the Contractor has been
mutually approved, upon request of Landlord, Tenant shall execute and deliver to
Landlord the T.E.A. and such other documents as Landlord may request to confirm
the selection of the Contractor and the bid of the Contractor.

 

(c) If, for any reason (including, without limitation, changes which Tenant
desires to effectuate in the Space Plan or the Construction Drawings prior to
their approval, revisions which must be made to the Space Plan or Construction
Drawings, or any renegotiation of bids Tenant wishes to pursue) other than
unreasonable delays attributable to Landlord, Landlord and Tenant have not
mutually approved the Space Plan, the Construction Drawings, the selection of
the Contractor and the bid, or if Tenant has not executed and delivered to
Landlord the T.E.A., on or before the date that is sixty (60) days after the
Effective Date of the Lease, then each day beyond such date until the parties
have mutually approved all such items and Tenant has executed and delivered to
Landlord the T.E.A. shall be deemed a day of “Tenant Delay” pursuant to Article
5 below.

 

2.03 Change Orders. All changes requested by Tenant shall require Landlord’s
prior written consent, not to be unreasonably withheld. All Change Orders must
be reviewed and approved by Landlord and Tenant, which review and approval will
not be unreasonably withheld (subject to Section 2.07 below with respect to
Landlord). Landlord shall use commercially reasonable efforts to review and
approve or disapprove each Change Order within five (5) business days after
receiving a Change Order. If Landlord fails to approve or disapprove a Change
Order within such five-business-day period, Landlord shall be deemed to have
disapproved the Change Order. If Landlord approves any Change Order, and if such
Change Order increases or decreases the cost of constructing Landlord’s Work,
Landlord shall prepare and deliver to Tenant a revised bid evidencing the total
costs of such Change Order, which will include any amounts incurred by Landlord
in reviewing the requested changes and revising the Approved Construction
Drawings and the fee provided below; provided, however, that Landlord shall not
execute or otherwise authorize any Change Order with Contractor unless and until
Tenant has approved such revised bid in writing, which approval shall not be
unreasonably withheld, conditioned, or delayed. Tenant shall review, comment on,
or approve such Change Order within three (3) calendar days after receiving the
same from Landlord. If Tenant fails to comment on or approve such Change Order
within such 3-day period, such Change Order shall be deemed approved by Tenant
for all purposes hereunder. Should any Change Order approved by Tenant modify
the Approved Construction Drawings, Tenant shall pay all additional costs
thereby incurred by Landlord, plus a fee of three percent (3%) of the additional
cost for Landlord’s cost of coordination, supervision and overhead resulting
from the revision to the Approved Construction Drawings, excluding any
additional architectural and/or engineering fees. All revised or additional
Construction Drawings are subject to Landlord’s prior review and written
approval. Landlord shall use commercially reasonable efforts to review and
approve or disapprove any revised or additional Construction Drawings within
five (5) business days after receipt thereof. If Landlord fails to approve or
disapprove any revised or additional Construction Drawings within such
five-business-day period, Landlord shall be deemed to have disapproved the
applicable revised or additional Construction Drawings. If and when approved or
deemed to have been approved by Landlord, such revised or additional
Construction Drawings shall constitute part of the Approved Construction
Drawings. Prior to commencement of construction or installation of any of
Landlord’s Work provided in any Tenant approved Change Order, Tenant shall
execute and deliver to Landlord a revised T.E.A. reflecting any increases or
decreases in the cost to Landlord of constructing Landlord’s Work.
Notwithstanding anything contained herein, if Tenant fails to approve any Change
Order, and if Landlord, in its reasonable judgment, believes that it would be
unwise or inefficient to continue with the Landlord’s Work until the issues
relating to such Change Order have been resolved, then Landlord may halt the
performance of the Landlord’s Work until such time as the Change Order is either
mutually approved by Landlord and Tenant or Landlord and Tenant mutually agree
to proceed with the Landlord’s Work without such Change Order, and any resulting
delay in achieving Substantial Completion of the Landlord’s Work shall be deemed
to be a Tenant Delay.

 

Exhibit B
Page 3 of 7

 

 

2.04 Legal Requirements. All design, construction and installation shall conform
to the requirements of the Lease and all applicable legal requirements. Tenant
agrees that any review or approval by Landlord of the Space Plan or the
Construction Drawings is solely for Landlord’s benefit, and without any
representation, warranty or liability whatsoever to Tenant or any other person
with respect to the adequacy, correctness or sufficiency thereof, or otherwise.
The approval by Landlord of the Approved Space Plan and the Approved
Construction Drawings shall not in any way be deemed to be an agreement or
certification by Landlord that the work contemplated thereby complies with legal
requirements or that the Approved Space Plan or the Approved Construction
Drawings will be approved by governmental agencies having jurisdiction there
over. Tenant and the Space Planner shall be solely responsible for the
compliance of the design shown on the Approved Space Plan and the Approved
Construction Drawings with legal requirements.

 

2.05 Materials and Workmanship. All work and materials required under the
Approved Construction Drawings, including all materials, finishes and
workmanship shall be equal to, or of a quality superior to, Building Standard.
Except as may be approved by Landlord and Tenant, all materials incorporated in
Landlord’s Work shall be new.

 

2.06 Field Verification. Space Planner shall verify at the job site all
dimensions, locations and structural members and any physical conditions
affecting the Construction Drawings.

 

2.07 Landlord’s Approval. Landlord shall not be unreasonably withhold, condition
or delay its consent to the Space Plan, the Construction Drawings, or any Change
Order so long as the applicable plans, drawings, and specifications, and the
work contemplated thereby: (a) do not involve structural portions of the Leased
Premises or Building or Building systems (including, but not limited to, HVAC
systems, life safety systems, electrical and plumbing systems); (b) affect only
the Leased Premises, and not other tenants or their premises, and are not
visible from outside of the Leased Premises; (c) do not affect the certificate
of occupancy issued for the Building or the Leased Premises; (d) do not involve
excess noise or fumes of any type; and (e) do not violate any legal
requirements. If, under the terms of this Work Letter, Landlord is deemed to
have disapproved the Space Plan, the Construction Drawings, the Contractor, the
bid, or any Change Order by reason of Landlord’s failure to timely notify Tenant
of Landlord’s approval or disapproval, then Tenant may provide Landlord with
written notice of such failure to respond (the “Second Notice”), which, in order
to be effective, must clearly, conspicuously and in bold type face set forth the
following statement at the top of the first page of the Second Notice: “SECOND
NOTICE! THE FAILURE OF LANDLORD TO RESPOND WITHIN FIVE (5) BUSINESS DAYS AFTER
THE RECEIPT OF THIS SECOND NOTICE BY LANDLORD SHALL BE DEEMED TO BE LANDLORD’S
APPROVAL.” If Landlord should fail to notify Tenant in writing of its approval
or disapproval within five (5) business days after receipt of such Second
Notice, Landlord shall be deemed to have approved the applicable item.

 

Exhibit B
Page 4 of 7

 

 

ARTICLE 3

 

LANDLORD’S OBLIGATIONS

 

3.01 Tenant Improvement Allowance.

 

(a) Landlord shall contribute the Tenant Improvement Allowance towards Tenant’s
Construction Costs (to the extent of the Tenant Improvement Allowance). The
Tenant Improvement Allowance must be used only for Tenant’s actual out-of-pocket
costs (hard and soft) of constructing Landlord’s Work. The cost of all
improvements required by the Approved Construction Drawings shall be paid from
such Tenant Improvement Allowance. Landlord will apply the Tenant Improvement
Allowance to pay Tenant’s Construction Costs, pursuant to Section 4.01 below, as
such costs are incurred. After the Tenant Improvement Allowance has been
exhausted, Landlord will apply Tenant’s Construction Costs Deposit to pay
Tenant’s Construction Costs as such costs are incurred. Except as set forth in
Section 2.07 of the Lease, any unused portion of the Tenant Improvement
Allowance shall be retained by Landlord, and Tenant shall have no further rights
with respect thereto. Any unused portion of Tenant’s Construction Costs Deposit
shall be refunded to Tenant.

 

(b) As set forth in this Work Letter, Landlord shall construct the Landlord’s
Work, and pay the cost thereof up to the amount of the Tenant Improvement
Allowance, but, in the event that the costs of the Landlord’s Work exceed the
total of the Tenant Improvement Allowance, then the entire amount of such excess
(hereinafter referred to as the “Excess”) shall be Tenant’s sole liability and
responsibility. However, within ten (10) days after the approval of the bid for
the Landlord’s Work, as set forth above, Tenant may notify Landlord in writing
as to whether or not Tenant elects to have Landlord pay up to $5.00 per rentable
square foot of the Leased Premises ($2,598,400.00 total) of the Excess (the
“Potentially Amortized Costs”). If Tenant elects to have Landlord provide the
Potentially Amortized Costs as set forth in this Section 3.01(b), the
Potentially Amortized Costs shall be added to and for all purposes of the Lease
and this Work Letter treated as part of the Tenant Improvement Allowance, and
shall be repaid by Tenant as set forth below in this Section 3.01(b). If Tenant
elects not to have the Potentially Amortized Costs added to the Tenant
Improvement Allowance and amortized as set forth in this Section 3.01(b), or
fails to provide notice of its election within such ten (10) day period, Tenant
shall be deemed to have waived its right to have such Potentially Amortized
Costs added to the Tenant Improvement Allowance and amortized as set forth in
this Section 3.01(b). In such event, the amount of the Potentially Amortized
Costs shall not be added to the Tenant Improvement Allowance. If Tenant elects
to have the Potentially Amortized Costs added to the Tenant Improvement
Allowance and amortized by Landlord, the Potentially Amortized Costs shall be
amortized over the initial Lease Term, as follows: The outstanding balance of
the Potentially Amortized Costs shall bear interest at the rate of seven percent
(7%) simple interest per annum from the date Tenant notifies Landlord of its
election to have the Potentially Amortized Costs added to the Tenant Improvement
Allowance and amortized until such amount is paid in full, and a sum equal to
the amount of principal and interest necessary to fully amortize the Potentially
Amortized Costs over the Lease Term in equal monthly installments shall be added
to Tenant’s liability for the payment of Rent due under the Lease (hereinafter
referred to as “Additional Monthly Payments”). The Additional Monthly Payments
shall constitute Additional Rent due under the Lease, and shall be paid monthly
at the same time and in the same manner that Monthly Rental Installments are
paid under the Lease (except that in no event shall the Rental Concession apply
to or be deemed to forgive or excuse payment of the Additional Monthly
Payments). After completion of the Landlord’s Work, Landlord shall calculate the
amount of the Potentially Amortized Costs and the amount of Tenant’s Additional
Monthly Payments and shall provide Tenant written notice of the results of such
calculations. Tenant agrees, if requested by Landlord, to execute an amendment
to the Lease setting forth the amount of the Additional Monthly Payments.
Failure to execute such amendment upon request of Landlord or to pay the
Additional Monthly Payments when due shall constitute a Default under the Lease.

 

3.02 Coordination. Unless otherwise agreed in writing by Landlord and Tenant,
all work involved in the construction and installation of Landlord’s Work shall
be carried out by Contractor under a contract with Landlord and under the sole
direction of Landlord. Tenant shall cooperate with Landlord, Contractor and the
Space Planner to promote the efficient and expeditious completion of such work.
All work not within the scope of the normal construction trades employed for the
Building, such as the furnishing and installation of draperies, furniture,
telephone equipment, voice and data cabling, and office equipment, shall be
furnished and installed by Tenant at Tenant’s expense.

 

Exhibit B
Page 5 of 7

 

 

3.03 Commencement of Construction. Landlord shall have no obligation to commence
or to allow commencement of construction or installation of Landlord’s Work in
the Leased Premises until: (a) Tenant has delivered to Landlord the Approved
Construction Drawings, initialed by Tenant’s Representative and Landlord’s
Representative, and the executed T.E.A., and Tenant has approved the selection
of the Contractor and the bid in writing, all as required pursuant to Section
2.02 above; (b) Landlord has received from Tenant payment of all Rent then due
under the Lease and the Security Deposit, if any, required under the Lease; and
(c) Landlord has received from Tenant payment of Tenant’s Construction Costs
Deposit, if any.

 

3.04 Commencement of Change Orders. Landlord shall have no obligation to
commence or to allow commencement of construction or installation of any of work
provided in any Change Order until Landlord has received from Tenant payment of
the required addition to Tenant’s Construction Costs Deposit, if any, and the
executed revised T.E.A., as provided in Section 2.03 above, with respect to such
Change Order.

 

3.05 Substitutions. Landlord, upon prior notice to Tenant, reserves the right to
make reasonable substitutions of equal or better quality and value in the event
of unavailability of materials or due to field conditions.

 

ARTICLE 4

 

TENANT’S OBLIGATIONS

 

4.01 Payments.

 

(a) Tenant shall be responsible for payment of the following to the extent such
costs exceed the Tenant Improvement Allowance: (i) the costs of preparation of
the Space Plan and the Construction Drawings (including, without limitation,
design fees, fees for architectural work and drawings, engineering fees, and
permit costs) and all costs to complete the construction of the Landlord’s Work,
including but not limited to the cost of all labor and materials supplied by the
Contractor and Landlord and their respective material suppliers, independent
contractors and subcontractors to construct and complete the Landlord’s Work,
including but not limited to the cost of any Change Orders, Contractor’s profit
and overhead expenses, and costs associated with sustainability practices,
documentation, registration and certification; and (ii) a fee equal to three
percent (3%) of the total of the costs set forth in this Section 4.01(a)
(including Change Orders) as a construction management fee. The costs set forth
in this Section 4.01(a) are collectively referred to herein as “Tenant’s
Construction Costs.”

 

(b) Tenant shall pay Tenant’s Construction Costs, plus any other costs owing by
Tenant to Landlord in connection with the construction of the Landlord’s Work,
as follows: (i) on the date of execution of the T.E.A., Tenant shall pay to
Landlord one hundred percent (100%) of the amount by which the amount indicated
on the T.E.A. exceeds the Tenant Improvement Allowance (“Tenant’s Construction
Costs Deposit”); (ii) on the date of approval by Landlord of any Change Order
which increases or decreases the cost of the Landlord’s Work, Tenant shall
execute a revised T.E.A., as provided in Section 2.03 above, evidencing such
increased or decreased cost and shall deposit with Landlord, as an addition to
Tenant’s Construction Costs Deposit, one hundred percent (100%) of the amount of
the increased or decreased costs represented by such Change Order; and (iii)
Tenant shall pay to Landlord, upon Substantial Completion of the Landlord’s
Work, the remainder, if any, of Tenant’s Construction Costs, plus any other
costs owing by Tenant to Landlord in connection with the construction of the
Landlord’s Work, such amount to be indicated on a statement delivered by
Landlord to Tenant and paid by Tenant. The amount shown on such statement shall
be paid by Tenant within ten (10) days after receipt of such statement. Tenant
agrees that in the event it fails to make any payment required in this Work
Letter in a timely manner, Landlord, in addition to any and all other remedies
allowed to Landlord by law or in equity, shall have the same rights and remedies
against Tenant as if a Default in payment of Rent had occurred under the Lease.

 

Exhibit B
Page 6 of 7

 

 

4.02 Early Access. Tenant shall have the right to access the Leased Premises
while the Landlord Work is being performed pursuant and subject to the terms of
Section 2.06 of the Lease.

 

4.03 Tenant’s Lease Default. Notwithstanding any provision to the contrary
contained in the Lease, if a Default (beyond any applicable notice and cure
period) under the Lease, or a default by Tenant under this Work Letter, has
occurred at any time on or before the Substantial Completion of Landlord’s Work,
then: (a) in addition to all other rights and remedies granted to Landlord
pursuant to the Lease, Landlord shall have the right to cause Contractor to
cease the construction of the Leased Premises (in which case, Tenant shall be
responsible for any delay in the Substantial Completion of Landlord’s Work
caused by such work stoppage as set forth in Section 5.01 of this Work Letter);
and (b) all other obligations of Landlord under the terms of this Work Letter
shall be forgiven until such time as such default is cured pursuant to the terms
of the Lease.

 

4.04 General Provisions. This Work Letter shall not be deemed applicable to: (a)
any space which is subsequently added to the original Leased Premises under the
Lease, whether by any option or right under the Lease, including expansion
options, rights of first offer and rights of first opportunity, or otherwise; or
(b) any portion of the Leased Premises or any additions thereto in the event of
a renewal or extension of the Lease Term, whether by any option or right under
the Lease, including extension or renewal options, or otherwise, unless
expressly provided in the Lease or any amendment thereto. Any changes to the
Approved Space Plan or the Approved Construction Drawings, or any additional
work required by any governmental agencies having jurisdiction over the Building
or any aspect of Landlord’s Work shall be complied with by Landlord and/or
Contractor. Such required changes and/or additional work shall not be deemed to
be a violation of the Approved Space Plan, the Approved Construction Drawings or
any other provision of this Work Letter and shall be accepted by Tenant. If such
required changes and/or additional work increase or decrease the cost to
Landlord of constructing Landlord’s Work, Landlord shall prepare and deliver to
Tenant a revised T.E.A. and a Change Order evidencing the total cost of such
changes and/or additional work. If Tenant notifies Landlord of a defect in
material or workmanship pertaining to the Landlord’s Work within one (1) year
after the Commencement Date, then Landlord will cause such defect to be repaired
as soon as reasonably practicable. Tenant’s sole and exclusive remedy against
Landlord for any defects in material or workmanship shall be for the repair and
replacement of such defects of material and workmanship. However, for the
avoidance of doubt, Landlord shall have no obligation to repair or replace such
defects of material or workmanship unless Tenant submits written notice of such
defects to Landlord within one (1) year after the Commencement Date. LANDLORD
MAKES NO WARRANTIES, EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED TO IMPLIED
WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE, IN
CONNECTION WITH THE LANDLORD’S WORK EXCEPT THE WARRANTIES EXPRESSLY SET FORTH IN
THIS SECTION 4.04. TENANT’S SOLE REMEDY FOR THE BREACH OF ANY APPLICABLE
WARRANTY SHALL BE THE REMEDY SET FORTH IN THIS SECTION 4.04. Tenant agrees that
no other remedy, including, without limitation, incidental or consequential
damages for lost profits, injury to person or property or any other incidental
or consequential loss shall be available to Tenant.

 

ARTICLE 5

 

DELAY

 

5.01 Tenant Delay. The term “Tenant Delay” shall mean each day that Substantial
Completion of Landlord’s Work is delayed by any of the following: (a) Tenant’s
failure to respond, within the time periods prescribed by Landlord (or, if no
time period is so prescribed, within five (5) days), to a request for
information necessary for the completion of the Space Plan or the Construction
Drawings; or (b) failure for any reason, other than unreasonable delays
attributable to Landlord, to develop the Approved Space Plan or the Approved
Construction Drawings by the dates prescribed herein; or (c) Tenant’s failure to
execute and deliver the T.E.A. by the date required in Section 2.02(b) above; or
(d) Tenant’s failure to pay the Rent as required in the Lease; or (e) Tenant’s
failure to pay Tenant’s Construction Costs Deposit by the date required in
Section 4.01(b)(i) above; or (f) changes by Tenant in the Approved Construction
Drawings or Change Orders which actually cause delays in the completion of
Landlord’s Work; or (g) requirements by Tenant for materials, finishes or
installations which are not Building Standard, including but not limited to any
delays caused by failure to obtain or to receive delivery or installation of any
such Non-Building Standard materials in a timely manner, but only to the extent
that Landlord informed Tenant that such requirements were likely to result in a
delay; or (h) any interference by Tenant with the performance of Landlord’s
Work; or (i) delay by Tenant in delivering to Landlord an executed, revised
T.E.A. and paying to Landlord any addition to Tenant’s Construction Costs
Deposit required by a Change Order; or (j) any other cause which is defined as a
Tenant Delay under this Work Letter or the Lease; or (k) intentionally omitted;
or (l) changes to the base, shell and core of the Building required by the
Approved Construction Drawings, but only to the extent that Landlord informed
Tenant that such changes were likely to result in a delay; or (m) if a
Certificate of Occupancy (temporary or final), is required in order to achieve
Substantial Completion of Landlord’s Work, any refusal by the appropriate
governmental authority to issue such Certificate of Occupancy due to Tenant’s
failure to install, or delay in installing, any furniture or equipment that
Landlord is not required to install as part of Landlord’s Work; or (n) any other
acts or omissions of Tenant, or its agents, or employees. The date that
Substantial Completion actually occurs will be accelerated for all purposes of
this Lease (including, without limitation, for determination of the Commencement
Date and the obligation to pay Rent (subject to the Rental Concession)), by the
number of days of any Tenant Delay that causes Landlord to be delayed in
achieving Substantial Completion. If Landlord is unable to achieve Substantial
Completion because of Tenant Delay, Landlord may, by written notice to Tenant,
establish the Commencement Date as the date on which Substantial Completion
could have been achieved, but for such Tenant Delay.

 

Exhibit B
Page 7 of 7

 

 

EXHIBIT C

 

FORM OF LETTER OF UNDERSTANDING

  

______________________________

Attn: ______________________, Property Manager

 _____________________________
_____________________________

 

RE:Lease between ____________________________________________(“Landlord”) and
__________________________________________ (“Tenant”) for the Leased Premises
located at ______________________________, __________________, __________ (the
“Leased Premises”), within _________________________, dated ________________
(the “Lease”).

 

Dear _________________________:

 

The undersigned, on behalf of Tenant, certifies to Landlord as follows:

 

1.The Commencement Date under the Lease is ____________________________.

 

3.The Expiration Date of the Lease is ___________________.

 

4.The Lease (including amendments or guaranty, if any) is the entire agreement
between Landlord and Tenant as to the leasing of the Leased Premises and is in
full force and effect.

 

5.Landlord has completed the improvements designated as Landlord’s obligation
under the Lease (excluding punchlist items as agreed upon by Landlord and
Tenant), if any, and Tenant has accepted the Leased Premises as of the
Commencement Date.

 

6.To the best of the undersigned’s knowledge, there are no uncured events of
default by either Tenant or Landlord under the Lease.

 

IN WITNESS WHEREOF, the undersigned has caused this Letter of Understanding to
be executed this ____ day of _________________, 20____.

  

EXHIBIT ONLY – NOT TO BE EXECUTED

  

Exhibit C
Page 1 of 1

 

 

EXHIBIT D

 

RULES AND REGULATIONS

 

1. The sidewalks, entrances, driveways and roadways serving and adjacent to the
Leased Premises shall not be obstructed or used for any purpose other than
ingress and egress. Landlord shall control the Common Areas.

 

2. No awnings or other projections shall be attached to the outside walls of the
Building. No curtains, blinds, shades or screens shall be attached to or hung
in, or used in connection with, any window or door of the Leased Premises other
than Landlord standard window coverings without Landlord’s prior written
approval. All electric ceiling fixtures hung in offices or spaces along the
perimeter of the Building must be fluorescent, of a quality, type, design and
tube color approved by Landlord. Neither the interior nor the exterior of any
windows shall be coated or otherwise sunscreened without written consent of
Landlord.

 

3. No sign, advertisement, notice or handbill shall be exhibited, distributed,
painted or affixed by any tenant on, about or from any part of the Leased
Premises, the Building or in the Common Areas including the parking area without
the prior written consent of Landlord. In the event of the violation of the
foregoing by any tenant, Landlord may remove or stop same without any liability,
and may charge the expense incurred in such removal or stopping to such tenant.

 

4. The sinks and toilets and other plumbing fixtures shall not be used for any
purpose other than those for which they were constructed, and no sweepings,
rubbish, rags, or other substances shall be thrown therein. All damages
resulting from any misuse of the fixtures shall be borne by the tenant who, or
whose subtenants, assignees or any of their servants, employees, agents,
visitors or licensees shall have caused the same.

 

5. Except for Landlord’s Work and improvements made by Tenant in accordance with
attached Lease, no boring, cutting or stringing of wires or laying of any floor
coverings shall be permitted, except with the prior written consent of Landlord
and as Landlord may direct. Landlord shall direct electricians as to where and
how telephone or data cabling are to be introduced. The location of telephones,
call boxes and other office equipment affixed to the Leased Premises shall be
subject to the approval of Landlord, which shall not be unreasonably withheld,
conditioned, or delayed.

 

6. No birds or animals of any kind (except service animals) shall be brought
into or kept in or about the Leased Premises, and no cooking shall be done or
permitted by any tenant on the Leased Premises, except microwave cooking, and
the preparation of coffee, tea, hot chocolate and similar items for tenants and
their employees. No tenant shall cause or permit any unusual or objectionable
odors to be produced in or permeate from the Leased Premises.

 

7. No tenant shall occupy or permit any portion of the Leased Premises to be
occupied as an office for the manufacture or sale of liquor, narcotics, or
tobacco in any form, or as a medical office, or as a barber or manicure shop, or
a dance, exercise or music studio, or any type of school or daycare or copy,
photographic or print shop or an employment bureau without the express written
consent of Landlord. The Leased Premises shall not be used for lodging or
sleeping or for any immoral or illegal purpose.

 

8. No tenant shall make, or permit to be made any unseemly, excessive or
disturbing noises or disturb or interfere with occupants of the Building,
neighboring buildings in the Park or neighboring premises, whether by the use of
any musical instrument, radio, phonograph, unusual noise, or in any other way.
No tenant shall throw anything out of doors, windows or down the passageways.

 

Exhibit D
Page 1 of 2

 

 

9. No tenant, subtenant or assignee nor any of its servants, employees, agents,
visitors or licensees, shall at any time bring or keep upon the Leased Premises
any flammable, combustible or explosive fluid, chemical or substance or firearm
in violation of any Laws.

 

10. No additional locks or bolts of any kind shall be placed upon any of the
doors or windows by any tenant, nor shall any changes be made to existing locks
or the mechanism thereof. Each tenant must upon the termination of his tenancy,
restore to Landlord all keys of doors, offices, and toilet rooms, either
furnished to, or otherwise procured by, such tenant and in the event of the loss
of keys so furnished, such tenant shall pay to Landlord the cost of replacing
the same or of changing the lock or locks opened by such lost key if Landlord
shall deem it necessary to make such changes.

 

11. Each tenant shall be responsible for all persons entering the Building at
tenant’s invitation, express or implied. Landlord shall in no case be liable for
damages for any error with regard to the admission to or exclusion from the
Building of any person. In case of an invasion, mob riot, public excitement or
other circumstances rendering such action advisable in Landlord’s opinion,
Landlord reserves the right without any abatement of rent to require all persons
to vacate the Building and to prevent access to the Building during the
continuance of the same for the safety of the tenants and the protection of the
Building and the property in the Building.

 

12. Canvassing, soliciting and peddling in the Building are prohibited, and each
tenant shall report and otherwise cooperate to prevent the same.

 

13. All equipment of any electrical or mechanical nature shall be placed by
tenant in the Leased Premises in settings that will, to the maximum extent
possible, absorb or prevent any vibration, noise and annoyance.

 

14. The scheduling of tenant move-ins shall be before or after normal business
hours and on weekends, subject to the reasonable discretion of Landlord.

 

15. The Building is a smoke-free Building. Smoking is strictly prohibited within
the Building. Smoking shall only be allowed in areas designated as a smoking
area by Landlord. Tenant and its employees, representatives, contractors or
invitees shall not smoke within the Building or throw cigar or cigarette butts
or other substances or litter of any kind in or about the Building, except in
receptacles for that purpose. Landlord may, at its sole discretion, impose a
charge against monthly rent of $50.00 per violation by tenant or any of its
employees, representatives, contractors or invitees, of this smoking policy.

 

16. Tenants will insure that all doors are securely locked, and water faucets,
electric lights and electric machinery are turned off before leaving the Leased
Premises.

 

17. Tenant, its employees, customers, invitees and guests shall, when using the
parking facilities in and around the Building, observe and obey all signs
regarding fire lanes and no-parking and driving speed zones and designated
handicapped and visitor spaces, and when parking always park between the
designated lines. Landlord reserves the right to tow away, at the expense of the
owner, any vehicle which is improperly parked or parked in a no-parking zone or
in a designated handicapped area, and any vehicle which is left in any parking
lot in violation of the foregoing regulation. All vehicles shall be parked at
the sole risk of the owner, and Landlord assumes no responsibility for any
damage to or loss of vehicles.

 

18. Tenant shall be responsible for and cause the proper disposal of medical
waste, including hypodermic needles, created by its employees.

  

19. Tenant shall not store any non-containerized, loose substances or materials
on the floor of the Leased Premises.

 

20. No outside storage is permitted including without limitation the storage of
trucks and other vehicles.

 

21. No tenant shall be allowed to conduct an auction from the Leased Premises
without the prior written consent of Landlord.

 

It is Landlord’s desire to maintain in the Building and Common Areas the highest
standard of dignity and good taste consistent with comfort and convenience for
tenants. Any action or condition not meeting this high standard should be
reported directly to Landlord. Landlord reserves the right to make such other
and further rules and regulations as in its judgment may from time to time be
necessary for the safety, care and cleanliness of the Building and Common Areas,
and for the preservation of good order therein. In the event of any conflict
between these Rules and Regulations and the terms of the Lease, the terms of the
Lease shall control in every instance.

 

Exhibit D
Page 2 of 2

 

 

EXHIBIT E

 

Approved Tenant Signage

 

 [ex10-3_007.jpg]

 

Exhibit E
Page 1 of 1

 

 

EXHIBIT F

 

PARKING LOT

 

[The Parking Lot consists of the areas marked with diagonal lines on the below
drawing]

 

 [ex10-3_008.jpg]

 

Exhibit F
Page 1 of 1

 

 

EXHIBIT G

 

PERMITTED HAZARDOUS SUBSTANCES

 

Description   Typical / Sample Grade information   Average On Hand   UOM
Polyethylene   polyethylene, powder   12,000   Pound EVERNOX 10   antioxidant,
powder   10,000   Kilo EVERFOS 168   antioxidant, powder   100,000   Kilo KRATON
- E1830HF POLYMER   rubber, powder   190,000   Pound 3M K37 - MICROSPHERES  
glass beads, powder   80,000   Pound 2460505 INDOFAST VIOLET 23   purple
pigment, powder   90   pound POLY FILM 63” 160cm .004mil   polyethylene plastic
film   128   roll POLY FILM 78.75” 200cm or 78.75” sws .004 mil   polyethylene
plastic film   128   roll POLY FILM CLEAR 110”   polyethylene plastic film   90
  roll STRETCH WRAP-50”-HIGH SLIP   polyethylene plastic film   180   roll
STRETCH WRAP-100”-HIGH SLIP   polyethylene plastic film   80   roll FIRE SOCK -
TWINXL - GEN2.1   flame resistant fabric   2,400   Each FIRE SOCK - FULL / QUEEN
- GEN2.1   flame resistant fabric   24,000   Each FIRE SOCK - KING / CAL KING -
GEN2.1   flame resistant fabric   18,000   Each MATTRESS - SCRIM 90% COTTON -
10% SPANDEX   cloth   70,000   kilos MINERAL OIL   liquid   40,000   gallons
MATTRESS - ENGLISH/FRENCH VINYL BAG TWIN/TWINXL   PVC bag   16,000   Each
MATTRESS - ENGLISH/FRENCH VINYL BAG FULL/QUEEN   PVC bag   50,000   Each
MATTRESS - ENGLISH/FRENCH VINYL BAG CALKING/KING   PVC bag   30,000   Each PET
BED - POLY BAG - SMALL   polyethylene plastic film   2,000   Each PET BED - POLY
BAG - MEDIUM   polyethylene plastic film   2,000   Each PET BED - POLY BAG -
LARGE   polyethylene plastic film   2,000   Each Glue 1000 Kilos per tote  
Water based Adhesive   15   tote Soap 5 gallon bucket   e.g. Dawn, or another
dish soap   4   bucket Compounded Hyper Elastic Polymer   The Purple Grid,
folded and boxed in plastic totes   varies on demand   Each Hydraulic Fluid  
oil, totes   2200   pound waste / used oil   oil, totes   6000   pound various
oils:  gear, lube, pneumatic, grease   oil, drums, small containers   500  
pound

 

Exhibit G
Page 1 of 1

 

 

EXHIBIT H-1

 

OIL TANK AREA

 

[The Oil Tank Area is the area marked with diagonal lines on the below drawing]

 

 [ex10-3_009.jpg]

 

Exhibit H-1
Page 1 of 1

 

 

EXHIBIT H-2

 

PRE-APPROVED PLANS FOR OIL TANKS

 

 [ex10-3_010.jpg]

   

Exhibit H-2
Page 1 of 2

 

 

 [ex10-3_011.jpg]

 

 

Exhibit H-2
Page 2 of 2