**Exhibit 10.22**

 

LEASE

 

This Lease (this “Lease”) is entered intobetween Musk Ox Properties, L.P., a limited partnership organized under Nevadalaw (“Landlord”) and Outdoor Channel Holdings, Inc., a Delawarecorporation (“Tenant”) as of January 1, 2006.

 

1.             Premises.  Landlord hereby leases toTenant, and Tenant hereby leases from Landlord, upon the terms and conditionsset forth herein, that certain real property, the building and otherimprovements commonly known as 43445 Business Park Drive, Temecula, CA 92590(the “Premises”).  The building on the Premisesconsists of approximately 32,777 square feet.

 

2.             Term.  The initial term of this Lease(the “Initial Term”) shall commence on January 1, 2006 (the “CommencementDate”) and end on December 31, 2010, unless this Lease is soonerterminated pursuant to its terms.  Afterthe Initial Term, provided that Tenant is not then in default, Tenant shallhave an option to renew this Lease (on the same terms and conditions, except asotherwise specified herein) for an additional period of two (2) to five (5) yearsas determined by Tenant in its sole discretion (the “First Option”) by givingLandlord notice thereof prior to the expiration of the Initial Term, and if theFirst Option is exercised, then upon the expiration of the time period selectedby Tenant upon the exercise of the First Option, provided that Tenant is notthen in default, Tenant shall have a second option to renew this Lease (on thesame terms and conditions, except as otherwise specified herein) for anadditional period of two (2) to five (5) years as determined byTenant in its sole discretion (the “Second Option”) by giving Landlord noticethereof prior to the expiration of the time period selected by Tenant upon theexercise of the First Option.  TheInitial Term, as extended in accordance with the First Option, if exercised,and/or the Second Option, if exercised, is referred to herein as the “Term.”

 

TheFirst Option and the Second Option granted to Tenant is personal to theoriginal Tenant named in the first paragraph of this Lease, and cannot bevoluntarily assigned or exercised by any person or entity other than saidoriginal Tenant while the original Tenant is in full and actual possession ofthe Premises.  The First Option and theSecond Option granted to Tenant are not assignable, either as a part of anassignment of this Lease or separately or apart therefrom, and neither theFirst Option nor the Second Option may be separated from this Lease in anymanner, by reservation or otherwise.  Notwithstandingthe foregoing, any option of any kind granted to Tenant by Landlord may beassigned or transferred to any subsidiary, affiliate, or the parent company ofthe Tenant without the consent of Landlord.

 

3.             Rent.  Tenant shall pay Landlord asrent for the Premises (“Rent”) for each month during the Term, that respective amountspecified on Schedule 1 per month on the first day of each calendarmonth during the Term.  Rent shall be dueand payable without any deduction or offset and without prior notice or demand,and will be made to the same address as notices to be sent under this Lease.

 

4.             Use; Compliance with Laws; Rules. Tenant may use the Premises for any business or commercial useauthorized by the City of Temecula.  Tenantshall promptly observe and comply with all laws with respect to Tenant’s use ofthe Premises; provided, however, that Tenant shall not be required to complywith any laws requiring the construction of alterations in the Premises, unlessdue to Tenant’s particular use of the Premises. Tenant shall not do or permit anything to be done in, about or withrespect to the Premises which would (a) injure the Premises or (b) vibrate,shake, overload, or impair the efficient operation of the Premises or thebuilding systems located therein.  Tenantshall comply with all reasonable rules and regulations promulgated fromtime to time by Landlord.

 

5.             Insurance.  Landlord shall obtain and keepin full force and effect, at Landlord’s sole cost, a policy of “all risk”property insurance insuring the Premises. Tenant shall obtain and keep in full force 

 

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and effect, at Tenant’s sole cost, a commercial general liabilitypolicy of insurance protecting Tenant against claims for bodily injury,personal injury and property damage based upon, involving or arising out ofTenant’s use or occupancy of the Premises and all areas appurtenantthereto.  Such insurance shall be on anoccurrence basis providing single limit coverage in an amount not less than$2,000,000 per occurrence.  The policyshall include coverage for liability assumed under this Lease as an “insuredcontract” for the performance of Tenant’s indemnity obligations under thisLease, and shall name Landlord as an additional insured.  In addition, Tenant shall obtain and keep infull force and effect, at Tenant’s sole cost, a policy of “all risk” propertyinsurance insuring Tenant’s personal property in the Premises.  Tenant shall deliver certificates evidencingsuch insurance to Landlord upon request. Each such insurance policy shall be in a form and from an insurancecompany reasonably acceptable to Landlord.

 

6.             Taxes.  Landlord shall pay beforedelinquency all real property taxes on the Premises.  Tenant shall pay before delinquency all taxesimposed against Tenant’s personal property.

 

7.             Release and Waiver of Subrogation. Notwithstanding anything to the contrary herein, Landlord and Tenanthereby release each other, and their respective agents, employees, subtenants,and contractors, from all liability for damage to any property that is causedby or results from a risk which is actually insured against or which wouldnormally be covered by “all risk” property insurance, without regard to thenegligence or willful misconduct of the entity so released.

 

8.             Indemnity.  Each party shall defend,indemnify, protect and hold harmless the other from and against any and allliability, loss, claim, damage and cost (including reasonable attorneys’ fees)to the extent due to the negligence or willful misconduct of the indemnifyingparty or its agents, employees or contractors or the indemnifying party’sviolation of the terms of this Lease. This indemnification shall survive the termination of this Lease.

 

9.             Hazardous Materials. Tenant shall not, without the prior written consent of Landlord, use,store, transport or dispose of any Hazardous Material in or about the Premises,except for Hazardous Materials normally used for janitorial purposes andsimilar items.  Tenant, at its sole cost,shall comply with all laws relating to its use of Hazardous Materials.  If Hazardous Materials stored, used, disposedof, emitted, or released on or about the Premises by Tenant or its agents,employees or contractors result in contamination of the Premises or the wateror soil thereunder, then Tenant shall promptly take any and all actionnecessary to clean up such contamination as required by law.  Tenant shall indemnify, defend, protect andhold Landlord and its officers, directors, employees, successors and assignsharmless from and against, all losses, damages, claims, costs and liabilities,including reasonable attorneys’ fees and costs, arising out of Tenant’s use,discharge, disposal, storage, transport, release or emission of HazardousMaterials on or about the Premises during the Term in violation of applicablelaw. “Hazardous Materials” shall mean any material or substance that is now orhereafter designated by any applicable governmental authority to be, orregulated by any applicable governmental authority as, radioactive, toxic,hazardous or otherwise a danger to health, reproduction or the environment.

 

10.           Repairs.  Tenant accepts the Premises in“as is” condition.  Tenant shall maintainin good order and condition the Premises; provided, however, that Tenant shallin no event be required to perform any repairs and maintenance (a) necessitatedby the acts or omissions of Landlord or its agents, employees or invitees, (b) toany of the building systems servicing the Premises or any structural portionsof the Premises, or (c) which could be properly treated as a capitalexpenditure under generally accepted accounting principles as in effect fromtime to time.  Except for obligationswhich are Tenant’s responsibility pursuant to the preceding sentence, Landlordshall maintain the Premises in good, working order.  Notwithstanding the foregoing, Tenant andLandlord may mutually agree that certain costs for repairs will be borne byTenant.

 

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11.           Alterations.  No alterations or improvementsshall be made to the Premises without the prior consent of Landlord.  All work performed in connection withalterations shall comply within all laws and applicable requirements ofinsurance carriers and shall be performed in a good and workmanlike manner by alicensed contractor approved by Landlord. Tenant shall keep the Premises free of any liens arising out of workperformed by or for Tenant.  Allalterations that cannot be removed without material damage to the Premisesshall be deemed part of the Premises upon installation.  Unless Landlord waives such right at the timeit consents to any alteration, Landlord shall have the right to require Tenantto remove any alterations it constructs in or on the Premises upon thetermination of this Lease.

 

12.           Services.  Landlord shall provide and payfor water regarding the Premises.  Tenantshall pay for all other utility services supplied to the Premises.

 

13.           Damage.  If the Premises are damaged byany peril, Landlord shall restore the Premises to substantially the samecondition as existed immediately prior to such damage, unless this Lease isterminated by Landlord or Tenant as set forth below.  Landlord shall have the right to terminatethis Lease, which option may be exercised by delivery to Tenant of a writtennotice within thirty (30) days after the date of such damage, in the eventthat:  (a) the Premises are damagedby a peril both not covered by the type of insurance Landlord is required tocarry under this Lease and not actually covered by valid and collectibleinsurance carried by Landlord to such an extent that the estimated cost torestore the Premises exceeds five percent (5%) of the then actual replacementcost thereof (and Tenant does not agree to pay the uninsured amount); or (b) thedamage to the Premises cannot reasonably be restored within one hundred eighty(180) days.  If the Premises are damageddue to any peril, Tenant shall be entitled to an abatement of all Rent to theextent of the interference with Tenant’s use of the Premises occasionedthereby.  If the damage resultingtherefrom cannot be (or is not in fact) repaired within one hundred eighty(180) days following the occurrence of such event, then Tenant also shall beentitled to terminate this Lease by delivery of written notice of terminationto Landlord at any time prior to restoration of the Premises.

 

14.           Condemnation.  Ifall or any part of the Premises is taken by the exercise of the power ofeminent domain or a voluntary transfer in lieu thereof (a “Condemnation”), thisLease shall terminate as to the part of the Premises taken.  If the Premises cannot be restored within onehundred eighty days (180) days of the Condemnation and made reasonably suitablefor Tenant’s continued occupancy, then Tenant shall have the right to terminatethis Lease by delivery of written notice to Landlord within thirty (30) days ofsuch Condemnation.  If this Lease is notterminated following a Condemnation, Landlord shall make all repairs andalterations that are reasonably necessary to make the portion of the Premisesnot taken a complete architectural unit reasonably suitable for Tenant’soccupancy, and Rent shall be reduced in proportion to the reduction in utilityto the Premises following the Condemnation. Tenant shall be entitled to receive any Condemnation proceeds for theunamortized value of alterations installed in the Premises at Tenant’s expense,Tenant’s relocation costs and lost goodwill. The balance of the award shall be the property of Landlord.

 

15.           Assignment and Subletting. Tenant may not assign this Lease, sublet the Premises or permit any useof the Premises by another party other than its affiliates (collectively, “Transfer”),without the prior written consent of Landlord, which may not be unreasonably withheld.  An assignment or transfer by operation of lawor otherwise in connection with a merger, consolidation, reorganization, stocksale or other like transaction shall also constitute a Transfer requiringLandlord’s consent hereunder.  Landlord’sconsent to one Transfer shall not constitute consent to a subsequent transfer.

 

16.           Default.  Tenant shall be in default ofits obligations under this Lease if any of the following events occur:  (a) Tenant fails to pay any Rent whendue, when such failure continues for ten 

 

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(10) daysafter written notice from Landlord to Tenant of a delinquency; (b) Tenantfails to perform any term, covenant or condition of this Lease (except thoserequiring payment of Rent) and fails to cure such breach within thirty (30)days after delivery of a written notice specifying the nature of the breach;provided, however, that if more than thirty (30) days reasonably are requiredto remedy the failure, then Tenant shall not be in default if Tenant commencesthe cure within the thirty (30) day period and thereafter diligently endeavorsto complete the cure; (c) Tenant makes a general assignment of its assetsfor the benefit of its creditors, including attachment of, execution on, or theappointment of a custodian or receiver with respect to a substantial part ofTenant’s property or any property essential to the conduct of its business; or (d) apetition is filed by or against Tenant under the bankruptcy laws of the UnitedStates or any other debtors’ relief law or statute, unless such petition isdismissed within sixty (60) days after filing.

 

17.           Remedies.  In the event of any default byTenant, Landlord shall have the following remedies, in addition to all otherrights and remedies provided by any law or otherwise provided in this Lease, towhich Landlord may resort cumulatively or in the alternative:

 

a.             Landlord may, at Landlord’s election, keepthis Lease in effect and enforce by an action at law or in equity all of itsrights and remedies under this Lease, including (i) the right to recoverthe Rent and other sums as they become due by appropriate legal action, (ii) theright to make payments required of Tenant or perform Tenant’s obligations andbe reimbursed by Tenant for the cost thereof, and (iii) the remedies ofinjunctive relief and specific performance to compel Tenant to perform itsobligations under this Lease.  Landlordshall have the remedy described in California Civil Code Section 1951.4(landlord may continue lease in effect after tenant’s breach and abandonmentand recover rent as it becomes due, if tenant has the right to sublet orassign, subject only to reasonable limitations).

 

b.             Landlord may, at Landlord’s election,terminate this Lease by giving Tenant written notice of termination, in whichevent this Lease shall terminate on the date set forth for termination in suchnotice.  Any such termination shall notrelieve Tenant from its obligation to pay sums then due Landlord or from anyclaim against Tenant for damages or Rent previously accrued or thenaccruing.  In the event Landlordterminates this Lease, Landlord shall be entitled, at Landlord’s election, todamages in an amount as permitted under applicable law, including, withoutlimitation:  (i) the worth at thetime of award of the amount by which the unpaid Rent for the balance of theterm after the time of award exceeds the amount of such rental loss that Tenantproves could be reasonably avoided, computed by discounting such amount at thediscount rate of the Federal Reserve Bank of San Francisco at the time of awardplus one percent (1%); and (ii) any other amount necessary to compensateLandlord for all detriment proximately caused by Tenant’s failure to performTenant’s obligations under this Lease, or which in the ordinary course ofthings would be likely to result therefrom.

 

18.           Right to Cure Defaults.  IfTenant fails to pay any sum of money to Landlord, or fails to perform any otheract on its part to be performed hereunder, then Landlord may, but shall not beobligated to, after passage of any applicable notice and cure periods (exceptin the case of an emergency, in which case no cure period is required), makesuch payment or perform such act.  Allsuch sums paid, and all reasonable costs and expenses of performing any suchact, shall be deemed additional Rent payable by Tenant to Landlord upon demand.

 

IfLandlord fails to perform any of its obligations under this Lease and (exceptin case of an emergency posing an immediate threat to persons or property, inwhich case no prior notice shall be required) fails to cure such default withinthirty (30) days after written notice from Tenant specifying the nature of suchdefault where such default could reasonably be cured within said thirty (30)day period, or fails to commence such cure within said thirty (30) day periodand thereafter continuously with due diligence prosecute such cure to completionwhere such default could not reasonably be cured within said 

 

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thirty(30) day period, then Tenant may, in addition to its other remedies, cure anydefault of Landlord and demand reimbursement by Landlord for the cost of suchcure.

 

19.           Surrender; Holdover. Prior to expiration of this Lease, Tenant shall remove all of itspersonal property and shall surrender the Premises to Landlord broom clean, inthe same condition as exists on the Commencement Date, reasonable wear andtear, alterations that Landlord agrees in writing may be surrendered, casualtyand condemnation, excepted.  If the Premisesare not so surrendered, then Tenant shall be liable to Landlord for all costsincurred by Landlord in returning the Premises to the required condition.  In the event that Tenant does not surrenderthe Premises upon the expiration or earlier termination of this Lease asrequired above, Tenant shall indemnify, defend, protect and hold harmlessLandlord from and against all loss, cost, claim, damage and liability resultingfrom Tenant’s delay in surrendering the Premises and pay Landlord holdover rentin an amount equal to one hundred fifty percent (150%) of the Rent payableunder this Lease during the last month of the Term.

 

20.           Estoppel Certificates. Within ten (10) calendar days after receipt of written demand byeither party, the other party shall execute and deliver to the requesting partyan estoppel certificate (a) certifying that this Lease is unmodified andin full force and effect or, if modified, the nature of such modification; (b) acknowledging,to the best of the responding party’s knowledge, that there are no uncureddefaults on the part of the requesting party; and (c) certifying suchother information as is reasonably required by the requesting party.

 

21.           Subordination.  ThisLease is subject and subordinate to all present and future ground leases,underlying leases, mortgages, deeds of trust or other encumbrances, and allrenewals, modifications and replacements thereof affecting any portion of the Premises(collectively, the “Mortgages”).  Notwithstandingthe foregoing, Landlord shall obtain a recognition agreement from the holder ofany current Mortgages in form reasonably acceptable to Tenant and suchsubordination to future Mortgages shall be conditioned upon Tenant’s receipt ofsuch a recognition agreement from the holder of the applicable Mortgage.

 

22.           Landlord’s Right to Enter. Provided Landlord complies with all of Tenant’s reasonable securitymeasures, Landlord or its agents may, upon reasonable notice (except in thecase of emergency), enter the Premises at any reasonable time for the purposeof inspecting the same, supplying any service to be provided by Landlord toTenant, making necessary alterations or repairs or for any other purposepermitted under this Lease.

 

23.           Late Charge.  If Tenant fails to pay toLandlord any amount due hereunder within five (5) days after the duedate, Tenant shall pay Landlord upon demand a late charge equal to five percent(5%) of the delinquent amount.  Inaddition, Tenant shall pay to Landlord interest on all amounts due, at the rateof prime plus two percent (2%) per annum or the maximum rate allowed by law,whichever is less, from that date which is five (5) days after thedue date to, and including, the date of the payment.

 

# 24.           Notices.  Any notice given under this Leaseshall be in writing and shall be hand delivered or mailed (by registered mail,return receipt requested, postage prepaid), addressed as follows:  (a) if to Tenant:  the address of the Premises, Attn.: ChiefFinancial Officer; and (b) if to Landlord: the address of the Premises, Attn.: Perry T. Massie.  Any notice shall be deemed to have been givenwhen hand delivered or, if mailed, three (3) business days after mailing.  Either party may change its address fornotices by giving the other party notice of such change.

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25.           Effect of Conveyance.  Asused in this Lease, the term “Landlord” means the owner.  In the event of any assignment or transfer ofthe Premises by Landlord, Landlord shall be and hereby is 

 

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entirelyrelieved of all covenants and obligations of Landlord accruing after the dateof such transfer, and it shall be deemed and construed that any transferee hasassumed and shall carry out all covenants and obligations thereafter to beperformed by Landlord hereunder.

 

26.           Parking.  Tenant shall have the right touse throughout the Term the parking spaces in the parking lot on the Premises.

 

27.           Signage.  Landlord shall, in Landlord’sreasonable discretion, upon request by Tenant, permit Tenant to installdirectory signage and other signage, in accordance with a design and at alocation that is mutually acceptable to Landlord and Tenant and in accordancewith applicable laws, rules and regulations.

 

28.           Miscellaneous.  ThisLease shall in all respects be governed by and construed in accordance with thelaws of the state in which the Premises are located.  If any term of this Lease is held to beinvalid or unenforceable by any court of competent jurisdiction, then theremainder of this Lease shall remain in full force and effect to the fullestextent possible under the law, and shall not be affected or impaired.  This Lease may not be amended except by thewritten agreement of all parties hereto. Time is of the essence with respect to the performance of everyprovision of this Lease in which time of performance is a factor.  Any executed copy of this Lease shall bedeemed an original for all purposes.  ThisLease shall, subject to the provisions regarding assignment and subletting,apply to and bind the respective heirs, successors, executors, administratorsand assigns of Landlord and Tenant.  Thelanguage in all parts of this Lease shall in all cases be construed as a wholeaccording to its fair meaning, and not strictly for or against either Landlordor Tenant.  The captions used in thisLease are for convenience only and shall not be considered in the constructionor interpretation of any provision hereof. No waiver by either party shall be deemed a waiver of any other provisionhereof or of any subsequent breach of the same or any other provision.  When a party is required to do something bythis Lease, it shall do so at its sole cost and expense without right ofreimbursement from the other party unless specific provision is madetherefor.  If either party brings anyaction or legal proceeding with respect to this Lease, the prevailing partyshall be entitled to recover reasonable attorneys’ and experts’ fees and courtcosts.  Whenever one party’s consent orapproval is required to be given as a condition to the other party’s right totake any action pursuant to this Lease, unless another standard is expresslyset forth, such consent or approval shall not be unreasonably withheld ordelayed.  This Lease may be executed incounterparts.

 

INWITNESS WHEREOF, the parties have executed this Lease as of the day first abovewritten.

 
| LANDLORD:                  |                 | TENANT:                              |
|----------------------------|----------------------|--------------------------------------|
|                       |                 |                                 |
| Musk  Ox Properties, L.P., |                 | Outdoor  Channel Holdings, Inc. |
|                       |                 |                                 |
| By:                        | /s/  Perry T. Massie |                                 | By: | /s/  William A. Owen |
| Name:                      | Perry  T. Massie     |                                 | Name: | William  A. Owen |
| Its:                       | General  Partner     |                                 | Its: | Chief  Financial Officer |
|                            |                      |                                      |  |  |  |  |  |  |

 

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**SCHEDULE 1**

 

**RENT**

 

| **YEAR** | ** ** | **MONTHLY RENT** | ** ** |
|----------|------------|------------------|------------|
| 2006     |       | $                | 29,105.98  |   |
| 2007     |       | $                | 29,979.16  |   |
| 2008     |       | $                | 30,878.53  |   |
| 2009     |       | $                | 31,804.89  |   |
| 2010     |       | $                | 32,759.03  |   |
| 2011     |       | $                | 33,741.80  |   |
| 2012     |       | $                | 34,754.06  |   |
| 2013     |       | $                | 35,796.68  |   |
| 2014     |       | $                | 36,870.58  |   |
| 2015     |       | $                | 37,976.70  |   |
| 2016     |       | $                | 39,116.00  |   |
| 2017     |       | $                | 40,289.48  |   |
| 2018     |       | $                | 41,498.16  |   |
| 2019     |       | $                | 42,743.11  |   |
| 2020     |       | $                | 44,025.40  |   |

 

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