Exhibit 10.1


 





	 	Transcript Document No. 2







 


ONTARIO
COUNTY INDUSTRIAL DEVELOPMENT AGENCY


 


(ONTARIO
COUNTY, NEW YORK)


 


and


 


AKOUSTIS,
INC.


 





 



 


LEASE
AND PROJECT AGREEMENT


 


 



 


Dated
as of February 1, 2018


 


Ontario
County Industrial Development Agency


(Akoustis,
Inc. 2018 Facility)


 






     


    


    

 


TABLE
OF CONTENTS





	 	 	 	 	 
	 	 	 	 	Page No.
	 	 	 	 	 
	ARTICLE I DEFINITIONS	 	2
	 	 	 
	ARTICLE II REPRESENTATIONS AND COVENANTS	 	2
	 	 	 
	 	Section 2.1	 	Representations and Covenants of Agency	 	2
	 	Section 2.2	 	Representations and Covenants of Company	 	3
	 	 	 	 	 	 
	ARTICLE III CONVEYANCE OF FACILITY SITE; PROJECT WORK AND COMPLETION	 	5
	 	 	 
	 	Section 3.1	 	Agreement to Convey to Agency	 	5
	 	Section 3.2	 	Title Report and Survey	 	5
	 	Section 3.3	 	Public Authorities Law Representations	 	5
	 	Section 3.4	 	Project Work	 	6
	 	Section 3.5	 	Identification of Equipment	 	6
	 	Section 3.6	 	Certificates of Completion	 	7
	 	Section 3.7	 	Remedies to Be Pursued Against Contractors, Subcontractors, Materialmen and Their Sureties	 	7
	 	 	 	 	 	 
	ARTICLE IV LEASE OF FACILITY RENTAL PROVISIONS	 	7
	 	 	 
	 	Section 4.1	 	Lease of Facility	 	7
	 	Section 4.2	 	Duration of Lease Term; Quiet Enjoyment	 	7
	 	Section 4.3	 	Rents and Other Amounts Payable	 	8
	 	Section 4.4	 	Obligations of Company Hereunder Unconditional	 	8
	 	Section 4.5	 	No Warranty of Condition or Suitability by Agency	 	8
	 	 	 	 	 	 
	ARTICLE V PILOT PAYMENTS; SALES TAX EXEMPTION; MORTGAGE RECORDING TAX EXEMPTION AND RECAPTURE OF BENEFITS	 	9
	 	 	 
	 	Section 5.1	 	PILOT Payments	 	9
	 	Section 5.2	 	Sales Tax Exemption	 	12
	 	Section 5.3	 	Mortgage Recording Tax Exemption	 	17
	 	Section 5.4	 	Recapture of Agency Benefits	 	17
	 	 	 	 	 	 
	ARTICLE VI MAINTENANCE, MODIFICATIONS, TAXES AND INSURANCE	 	20
	 	 	 
	 	Section 6.1	 	Maintenance and Modifications of Facility by Company	 	20
	 	Section 6.2	 	Installation of Additional Equipment	 	21
	 	Section 6.3	 	Taxes, Assessments and Utility Charges	 	21
	 	Section 6.4	 	Insurance Required	 	22
	 	Section 6.5	 	Additional Provisions Respecting Insurance	 	24
	 	Section 6.6	 	Application of Net Proceeds of Insurance	 	24
	 	Section 6.7	 	Right of Agency to Pay Taxes, Insurance Premiums and Other Charges	 	25



 






     


    


    

 


	ARTICLE VII DAMAGE, DESTRUCTION AND CONDEMNATION	 	25
	 	 	 	 	 	 
	 	Section 7.1	 	Damage or Destruction of the Facility	 	25
	 	Section 7.2	 	Condemnation	 	27
	 	Section 7.3	 	Condemnation of Company-Owned Property	 	28
	 	Section 7.4	 	Waiver of Real Property Law Section 227	 	28
	 	 	 	 	 	 
	ARTICLE VIII SPECIAL COVENANTS	 	28
	 	 	 
	 	Section 8.1	 	Right to Inspect Facility	 	28
	 	Section 8.2	 	Hold Harmless Provisions	 	29
	 	Section 8.3	 	Company to Maintain Its Existence	 	31
	 	Section 8.4	 	Qualification in State	 	31
	 	Section 8.5	 	Agreement to File Annual Statements and Provide Information	 	31
	 	Section 8.6	 	Books of Record and Account; Financial Statements	 	31
	 	Section 8.7	 	Compliance with Orders, Ordinances, Etc	 	32
	 	Section 8.8	 	Discharge of Liens and Encumbrances	 	32
	 	Section 8.9	 	Depreciation Deductions and Investment Tax Credit	 	33
	 	Section 8.10	 	Employment Opportunities; Notice of Jobs	 	33
	 	Section 8.11	 	Employment at the Facility	 	33
	 	 	 	 	 	 
	ARTICLE IX RELEASE OF CERTAIN LAND; ASSIGNMENTS AND SUBLEASING	 	33
	 	 	 
	 	Section 9.1	 	Restriction on Sale of Facility; Release of Certain Land	 	33
	 	Section 9.2	 	Removal of Equipment	 	34
	 	Section 9.3	 	Assignment and Subleasing	 	35
	 	Section 9.4	 	Merger of Agency	 	36
	 	 	 	 	 	 
	ARTICLE X EVENTS OF DEFAULT AND REMEDIES	 	36
	 	 	 
	 	Section 10.1	 	Events of Default Defined	 	36
	 	Section 10.2	 	Remedies on Default	 	38
	 	Section 10.3	 	Remedies Cumulative	 	39
	 	Section 10.4	 	Agreement to Pay Attorneys’ Fees and Expenses	 	39
	 	Section 10.5	 	No Additional Waiver Implied by One Waiver	 	39
	 	Section 10.6	 	Certificate of No Default	 	39
	 	 	 	 	 	 
	ARTICLE XI EARLY TERMINATION OF LEASE AGREEMENT OPTION IN FAVOR OF COMPANY	 	40
	 
	 	Section 11.1	 	Early Termination of Lease Agreement	 	40
	 	Section 11.2	 	Conditions to Termination of Lease Agreement	 	40
	 	Section 11.3	 	Conveyance on Termination	 	40
	 	 	 	 	 	 
	ARTICLE XII LENDER PROVISIONS	 	41
	 	 	 
	 	Section 12.1	 	Subordination of Lease Agreement	 	41
	 	Section 12.2	 	Mortgage and Pledge of Agency’s Interests to Lender	 	41
	 	Section 12.3	 	Pledge of Company’s Interest to Lender	 	41
	 	Section 12.4	 	Making of Loans; Disbursement of Loan Proceeds	 	41
	 	Section 12.5	 	References to Lender, Loan or Mortgage	 	42



 






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	ARTICLE XIII ENVIRONMENTAL MATTERS	 	42
	 	 	 	 	 	 
	 	Section 13.1	 	Environmental Representations of the Company	 	42
	 	Section 13.2	 	Environmental Covenants of the Company	 	43
	 	Section 13.3	 	Survival Provision	 	45
	 	 	 	 	 	 
	ARTICLE XIV MISCELLANEOUS	 	46
	 	 	 
	 	Section 14.1	 	Notices	 	46
	 	Section 14.2	 	Binding Effect	 	47
	 	Section 14.3	 	Severability	 	47
	 	Section 14.4	 	Amendments, Changes and Modifications	 	47
	 	Section 14.5	 	Execution of Counterparts	 	47
	 	Section 14.6	 	Applicable Law	 	47
	 	Section 14.7	 	List of Additional Equipment; Further Assurances	 	47
	 	Section 14.8	 	Survival of Obligations	 	47
	 	Section 14.9	 	Table of Contents and Section Headings Not Controlling	 	47
	 	Section 14.10	 	Waiver of Trial by Jury	 	47
	 	 	 	 	 	 
	 	EXHIBIT A	 	Legal Description of Real Property	 	 
	 	EXHIBIT B	 	Equipment	 	 
	 	EXHIBIT C	 	PILOT Schedule	 	 
	 	EXHIBIT D	 	Mortgage Requirements	 	 
	 	EXHIBIT E	 	Sales Tax Agent Authorization Letter	 	 
	 	EXHIBIT F	 	Sales Tax Registry	 	 
	 	EXHIBIT G	 	Local Requirements Policy	 	 
	 	EXHIBIT H	 	Exceptions to Representations and Warranties of Company	 	 
	 	EXHIBIT I	 	Form Tenant Agency Compliance Agreement	 	 
	 	SCHEDULE A	 	Schedule of Definitions	 	 


 






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THIS
LEASE AND PROJECT AGREEMENT, dated as of February 1, 2018 (this “Lease Agreement”), is between the ONTARIO
COUNTY INDUSTRIAL DEVELOPMENT AGENCY, a public benefit corporation of the State of New York, having its office at 20 Ontario Street,
Canandaigua, New York 14424 (the “Agency”), and AKOUSTIS, INC., a business corporation duly organized and validly
existing under the laws of the State of Delaware and authorized to transact business in the State of New York, having its principal
office at 9805-A Northcross Center Court, Huntersville, North Carolina 28078 (the “Company”).


 


R
E C I T A L S


 


WHEREAS,
Title 1 of Article 18-A of the General Municipal Law of the State of New York was duly enacted into law as Chapter 1030 of the
Laws of 1969 of the State of New York (the “State”); and


 


WHEREAS,
the aforesaid act authorizes the creation of industrial development agencies for the Public Purposes of the State; and


 


WHEREAS,
the aforesaid act further authorizes the creation of industrial development agencies for the benefit of the several counties,
cities, villages and towns in the State and empowers such agencies, among other things, to acquire, construct, reconstruct, renovate,
refurbish, equip, lease, sell and dispose of land and any building or other improvement, and all real and personal property, including
but not limited to machinery and equipment deemed necessary in connection therewith, whether now in existence or under construction,
which shall be suitable for manufacturing, warehousing, research, commercial, recreation or industrial facilities, in order to
advance job opportunities, health, general prosperity and the economic welfare of the people of the State and to improve their
standard of living; and


 


WHEREAS,
pursuant to and in accordance with the provisions of the aforesaid act, as amended, and Chapter 533 of the Laws of 1971 of the
State, as amended (collectively, the “Act”), the Agency was created and is empowered under the act to undertake
the Project Work and the leasing of the Facility defined below; and


 


WHEREAS,
the Project shall consist of the acquisition of an approximately 9.995 acre parcel of land located at 5450 Campus Drive, Canandaigua,
New York 14424 (the “Land”), the renovation of portions of an existing approximately 120,000 square foot building
located thereon (the “Improvements”), and the acquisition and installation therein of certain equipment and
personal property (the “Equipment”; and, together with the Land and the Improvements, the “Facility”),
which Facility is to be leased and subleased by the Agency to the Company and used in part by the Company for its primary use
as research and development, manufacturing, warehouse and professional office space in its business as a designer and manufacturer
of bulk acoustic wave filters for use in wireless technology, and to be subleased, in part, by the Company to various existing
tenants (the “Tenants”) (the “Project”); and


 


WHEREAS,
the Company has agreed with the Agency, on behalf of the Agency and as the Agency’s agent, to complete the Project Work;
and


 






     


    


    

 


WHEREAS,
the Company has agreed to lease the Land and the Improvements to the Agency pursuant to the terms of a certain Company Lease Agreement,
dated as of February 1, 2018 (the “Company Lease”), by and between the Company and the Agency; and


 


WHEREAS,
the Company has agreed to transfer title to the Equipment to the Agency pursuant to a certain Bill of Sale, dated the Closing
Date (the “Bill of Sale”); and


 


WHEREAS,
the Agency has agreed to sublease and lease the Facility to the Company, and the Company desires to rent the Facility from the
Agency, upon the terms and conditions set forth in this Lease Agreement.


 


AGREEMENT


 


For
and in consideration of the premises and the mutual covenants hereinafter contained, the parties hereto do hereby mutually agree
as follows:


 


ARTICLE
I


DEFINITIONS


 


All
capitalized terms used in this Lease Agreement and not otherwise defined herein shall have the meanings assigned thereto in the
Schedule of Definitions attached hereto as Schedule A.


 


ARTICLE
II


REPRESENTATIONS AND COVENANTS


 


Section
2.1     Representations and Covenants of Agency. The Agency makes the following representations
and covenants as the basis for the undertakings on its part herein contained:


 


(a)          The
Agency is duly established and validly existing under the provisions of the Act and has full legal right, power and authority
to execute, deliver and perform each of the Agency Documents and the other documents contemplated thereby. Each of the Agency
Documents and the other documents contemplated thereby has been duly authorized, executed and delivered by the Agency.


 


(b)          The
Agency will acquire a leasehold interest in the Land and Improvements, cause the Improvements to be renovated and the Equipment
to be acquired and installed and will lease and sublease the Facility to the Company pursuant to this Lease Agreement, all for
the Public Purposes of the State.


 


(c)          By
resolution dated April 24, 2017, the Agency determined that, based upon the review by the Agency of the materials submitted and
the representations made by the Company relating to the Facility, the Facility would not have a “significant impact”
or “significant effect” on the environment within the meaning of the SEQR Act. Such resolution has not been rescinded
as of the date of this Lease Agreement.


 






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(d)          Neither
the execution and delivery of any of the Agency Documents and the other documents contemplated thereby or the consummation of
the transactions contemplated thereby nor the fulfillment of or compliance with the provisions of any of the Agency Documents
and the other documents contemplated thereby will conflict with or result in a breach of or constitute a default under any of
the terms, conditions or provisions of the Act, any other law or ordinance of the State or any political subdivision thereof,
the Agency’s Certificate of Establishment or By-Laws, as amended, or any corporate restriction or any agreement or instrument
to which the Agency is a party or by which it is bound, or result in the creation or imposition of any Lien of any nature upon
any of the Property of the Agency under the terms of the Act or any such law, ordinance, Certificate of Establishment, By-Laws,
restriction, agreement or instrument, except for Permitted Encumbrances.


 


(e)          Each
of the Agency Documents and the other documents contemplated thereby constitutes a legal, valid and binding obligation of the
Agency enforceable against the Agency in accordance with its terms.


 


(f)          The
Agency has been induced to enter into this Lease Agreement by the undertaking of the Company to utilize the Facility in the County
of Ontario, New York in furtherance of the Public Purposes of the Agency.


 


(g)          The
Agency will execute, acknowledge (if appropriate) and deliver from time to time such instruments and documents which are necessary
or desirable to carry out the intent and purposes of this Lease Agreement.


 


Section
2.2     Representations and Covenants of Company. The Company makes the following representations
and covenants as the basis for the undertakings on its part herein contained:


 


(a)          The
Company is a business corporation, organized and existing under the laws of the State of Delaware and authorized to transact business
in the State of New York, is in good standing under the laws of the State of New York and the State of Delaware, and has full
legal right, power and authority to execute, deliver and perform each of the Company Documents and the other documents contemplated
thereby. Each of the Company Documents and the other documents contemplated thereby has been duly authorized, executed and delivered
by the Company.


 


(b)          Neither
the execution and delivery of any of the Company Documents and the other documents contemplated thereby or the consummation of
the transactions contemplated thereby nor the fulfillment of or compliance with the provisions of any of the Company Documents
and the other documents contemplated thereby will conflict with or result in a breach of or constitute a default under any of
the terms, conditions or provisions of any law or ordinance of the State or any political subdivision thereof, the Company’s
Organizational Documents, as amended, or any restriction or any agreement or instrument to which the Company is a party or by
which it is bound, or result in the creation or imposition of any Lien of any nature upon any of the Property of the Company under
the terms of any such law, ordinance, Organizational Documents, as amended, restriction, agreement or instrument, except for Permitted
Encumbrances.


 






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(c)          The
Facility, the Project Work and the design, and operation of the Facility will conform with all applicable zoning, planning, building
and Environmental Laws, ordinances, rules and regulations of governmental authorities having jurisdiction over the Facility. Under
penalty of perjury, the Company certifies that it is in substantial compliance with all local, state, and federal tax, worker
protection and environmental laws, rules and regulations.


 


(d)          Each
of the Company Documents and the other documents contemplated thereby constitutes a legal, valid and binding obligation of the
Company enforceable against the Company in accordance with its terms.


 


(e)          The
Facility is and will continue to be a “project” as such quoted term is defined in the Act. The Company will not take
any action, or fail to take any action, which action or failure to act would cause the Facility not to constitute a “project”
as such quoted term is defined in the Act.


 


(f)          The
transactions contemplated by this Lease Agreement shall not result in the removal of any facility or plant of any Facility occupant(s)
from one area of the State to another area of the State or in the abandonment of one or more facilities or plants of the Facility
occupant(s) located within the State.


 


(g)         The
Company agrees to take any actions reasonably deemed necessary by the Agency, or its Chairman, Vice Chairman, Executive Director,
or any member or officer of the Agency, counsel to the Agency or Transaction Counsel, in order to ensure compliance with Sections
2.2(e) and (f) and 9.3 of this Lease Agreement provided that the Company receives duly acknowledged written confirmation from
the Agency setting forth the reason(s) for said action(s). Without limiting the generality of the foregoing, the Company will
provide the Agency with any and all information and materials describing proposed Facility occupants as necessary.


 


(h)          The
Company will sublease and lease the Facility in accordance with the provisions hereof, including, but not limited to, Section
9.3 hereof, and will cause future commercial (as opposed to residential) tenants of portions of the Facility to execute and deliver
to the Agency a Tenant Agency Compliance Agreement substantially in the form attached hereto as Exhibit I, prior to the
occupancy of the Facility, or a portion thereof, by such tenant, in accordance with the provisions of Section 9.3 hereof.


 


(i)          The
Company hereby represents to the Agency that facilities and property that are primarily used in making retail sales of goods and
services to customers who personally visit the Facility will not constitute more than one-third (1/3) of the total costs of the
Facility, except in accordance with New York General Municipal Law (the “GML”) Section 862.


 


(j)          There
is no action or proceeding pending or, to the best of the Company’s knowledge, after diligent inquiry, threatened, by or
against the Company by or before any court or administrative agency that would adversely affect the ability of the Company to
perform its obligations under this Lease Agreement or any other Company Document.


 






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(k)
        The Company has obtained all authorizations, consents and approvals of governmental
bodies or agencies required to be obtained by it as of the Closing Date in connection with the execution and delivery of this
Lease Agreement and each other Company Document or in connection with the performance of its obligations hereunder and under each
Company Document.


 


(l)          The
Project Application Information was true, correct and complete as of the date submitted to the Agency, and no event has occurred
or failed to occur since such date of submission which could cause any of the Project Application Information to include any untrue
statement of a material fact or omit to state any material fact required to be stated therein to make such statements not misleading.


 


ARTICLE
III


CONVEYANCE OF FACILITY SITE; PROJECT WORK AND COMPLETION


 


Section
3.1     Agreement to Convey to Agency. The Company has conveyed or has caused to be conveyed to
the Agency (i) a leasehold interest in the Land, including any buildings, structures or other improvements thereon, and (ii) lien-free
title to the Equipment, and will convey or cause to be conveyed to the Agency lien-free title to or a leasehold interest in the
Equipment and Improvements acquired after the date hereof, in each case except for Permitted Encumbrances.


 


Section
3.2     Title Report and Survey. The Company has obtained and delivered to the Agency (i) a title
report (in form and substance acceptable to the Agency) reflecting all matters of record with respect to the Land and existing
Improvements, including municipal searches and (ii) a current or updated survey of each of the Land and the existing Improvements
certified to the Agency, or an affidavit dated within seven (7) days of the Closing Date that there has been no significant changes
to the Land and existing Improvements which would render inaccurate their depiction on that survey map prepared by McMahon LaRue
Associates P.C. dated May 8, 2017 (Project No. 2017-026, Sheets No. 1 and No. 2 of 2).


 


Section
3.3     Public Authorities Law Representations. The parties hereto hereby acknowledge and agree
that the Facility and the interest therein to be conveyed by this Lease Agreement are not “Property” as defined in
Article 9, Title 5-A of the Public Authorities Law of the State because the Facility and the leasehold interests therein are securing
the financial obligations of the Company. The Facility and the leasehold interests therein secure the obligations of the Company
to the Agency under this Lease Agreement, including the Company’s obligation to acquire and maintain the Facility and complete
the Project Work on behalf of the Agency and the Company’s obligation to indemnify and hold harmless the Agency.


 






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Section
3.4     Project Work.


 


(a)          The
Company agrees that, on behalf of the Agency, it will complete the Project Work in accordance with the information supplied to
the Agency as part of the Project Application Information.


 


(b)          The
Company may revise the Plans and Specifications from time to time without the consent or approval of the Agency; provided that
the Facility shall retain its overall configuration and intended purposes and shall remain a “project” as defined
in the Act.


 


(c)          Except
as set forth in Section 6.2 hereof, fee or leasehold title, as applicable, to all materials, equipment, machinery and other items
of Property incorporated or installed in or placed in, upon, or under the Facility shall vest in the Agency immediately upon the
Company’s obtaining an interest in or to the materials, equipment, machinery and other items of Property. The Company shall
execute, deliver and record or file all instruments necessary or appropriate so to vest such title in the Agency and shall take
all action necessary or appropriate to protect such title against claims of any third Persons.


 


(d)          The
Agency shall enter into, and accept the assignment of, such contracts as the Company may request in order to effectuate the purposes
of this Section 3.4.


 


(e)          The
Company, as agent for the Agency, shall comply in all material respects with all provisions of the Labor Law of the State applicable
to the completion of the Project Work and shall include in all construction contracts all provisions which may be required to
be inserted therein by such provisions. The Company shall comply with the relevant policies of the Agency with respect to such
laws, which are set forth as Exhibit G attached hereto. Except as provided in the preceding two sentences, the provisions
of this subsection do not create any obligations or duties not created by applicable law outside of the terms of this Lease Agreement.
For the purposes of this Lease Agreement, it is understood that installation, placement, maintenance, servicing, cleaning and
repair of the specialty equipment relating to the Company’s manufacture of bulk acoustic wave filters for use in wireless
technology (e.g., MOCVD, etchers, trim tools, polishers, grinders, bonders, coaters, tapers, and related chillers) shall be “specialty
work” and be exempt from the policies set forth in Exhibit G; provided however, the Company agrees that any
routine maintenance to the building, grounds or non-specialty equipment (e.g., HVAC, plumbing, electrical) will be subject to
the policies in Exhibit G and subject to the waiver process detailed therein.


 


Section
3.5     Identification of Equipment. All Equipment which is or may become the Property of the
Agency pursuant to the provisions of this Lease Agreement shall be properly identified by the Company by such appropriate records,
including computerized records, as may be approved by the Agency. All Property of whatever nature affixed or attached to the Land
or used or to be used by the Company in connection with the Land or the Improvements shall be deemed presumptively to be owned
by the Agency, rather than the Company, unless the same were installed by the Company and title thereto was retained by the Company
as provided in Section 6.2 of this Lease Agreement and such Property was properly identified by such appropriate records as were
approved by the Agency.


 






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Section
3.6     Certificates of Completion. To establish the Completion Date, the Company shall deliver
to the Agency (i) a certificate signed by an Authorized Representative of the Company stating (a) that the Project Work has been
completed in accordance with the Plans and Specifications therefor, and (b) that payment for all labor, services, materials and
supplies used in such Project Work has been made or provided for; and (ii) such other certificates as may be reasonably satisfactory
to the Agency, including without limitation, a final certificate of occupancy, if applicable. The Company agrees to complete the
Project Work by December 31, 2018.


 


Section
3.7     Remedies to Be Pursued Against Contractors, Subcontractors, Materialmen and Their Sureties.
In the event of a default by any contractor, subcontractor, materialman or other Person under any contract made by it in connection
with the Facility or in the event of a breach of warranty or other liability with respect to any materials, workmanship or performance
guaranty, the Company at its expense, either separately or in conjunction with others, may pursue any and all remedies available
to it and the Agency, as appropriate, against the contractor, subcontractor, materialman or other Person so in default and against
any surety for the performance of such contract. The Company, in its own name or in the name of the Agency, may prosecute or defend
any action or proceeding or take any other action involving any such contractor, subcontractor, materialman, surety or other Person
which the Company deems reasonably necessary, and in such event the Agency, at the Company’s sole cost and expense, hereby
agrees to cooperate fully with the Company and to take all action necessary to effect the substitution of the Company for the
Agency in any such action or proceeding. The Net Proceeds of any recovery from a contractor or subcontractor or materialman or
other person shall be paid to the Company.


 


ARTICLE
IV


LEASE OF FACILITY RENTAL PROVISIONS


 


Section
4.1     Lease of Facility. The Agency hereby subleases and leases the Facility, consisting of
the Land as more particularly described in Exhibit A attached hereto and the Improvements and the Equipment as more particularly
described in Exhibit B attached hereto, to the Company and the Company hereby takes the Facility from the Agency upon the
terms and conditions of this Lease Agreement.


 


Section
4.2     Duration of Lease Term; Quiet Enjoyment.


 


(a)          The
Agency shall deliver to the Company sole and exclusive possession of the Facility (subject to Sections 8.1 and 10.2 hereof), and
the leasehold and subleasehold estate created hereby shall commence, and the Company shall accept possession of the Facility on
the Closing Date.


 


(b)          Except
as provided in Sections 10.2 and 11.1 hereof, the estate created hereby shall terminate at 11:58 p.m. on December 31, 2028 (the
“Lease Term”).


 






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(c)          Except
as provided in Sections 8.1 and 10.2 hereof, the Agency shall neither take nor suffer or permit any action to prevent the Company
during the Lease Term from having quiet and peaceable possession and enjoyment of the Facility and will, at the request of the
Company and at the Company’s sole cost and expense, cooperate with the Company in order that the Company may have quiet
and peaceable possession and enjoyment of the Facility as hereinabove provided.


 


Section
4.3     Rents and Other Amounts Payable.


 


(a)          The
Company shall pay basic rent for the Facility as follows: One Dollar ($1.00) per year commencing on the Closing Date and on each
and every January 1 thereafter during the term of this Lease Agreement.


 


(b)          In
addition to the payments of basic rent pursuant to Section 4.3(a) hereof, throughout the Lease Term, the Company shall pay to
the Agency as additional rent, within ten (10) days of receipt of demand therefor, an amount equal to the sum of the expenses
of the Agency and the members thereof incurred (i) by reason of the Agency’s ownership, leasing, subleasing, or financing
of the Facility, or (ii) in connection with the carrying out of the Agency’s duties and obligations under the Agency Documents,
the payment of which is not otherwise provided for under this Lease Agreement. The foregoing shall be in addition to any annual
or continuing administrative or management fee imposed by the Agency now or hereafter.


 


(c)          The
Company, under the provisions of this Section 4.3, agrees to make the above-mentioned payments in immediately available funds
and without any further notice in lawful money of the United States of America. In the event the Company shall fail to timely
make any payment required in Section 4.3(a) or 4.3(b), the Company shall pay the same together with interest on such payment at
a rate equal to two percent (2%) plus the Prime Rate, but in no event at a rate higher than the maximum lawful prevailing rate,
from the date on which such payment was due until the date on which such payment is made.


 


Section
4.4     Obligations of Company Hereunder Unconditional. The obligations of the Company to make
the payments required in Section 4.3 hereof, and to perform and observe any and all of the other covenants and agreements on its
part contained herein, shall be general obligations of the Company, and shall be absolute and unconditional irrespective of any
defense or any rights of setoff, recoupment or counterclaim it may otherwise have against the Agency. The Company agrees it will
not (i) suspend, discontinue or abate any payment required hereunder, or (ii) fail to observe any of its other covenants or agreements
in this Lease Agreement.


 


Section
4.5     No Warranty of Condition or Suitability by Agency. THE AGENCY HAS MADE AND MAKES NO REPRESENTATION
OR WARRANTY WHATSOEVER, EITHER EXPRESS OR IMPLIED, WITH RESPECT TO THE MERCHANTABILITY, CONDITION, FITNESS, DESIGN, OPERATION
OR WORKMANSHIP OF ANY PART OF THE FACILITY, ITS FITNESS FOR ANY PARTICULAR PURPOSE, THE QUALITY OR CAPACITY OF THE MATERIALS IN
THE FACILITY, OR THE SUITABILITY OF THE FACILITY FOR THE PURPOSES OR NEEDS OF THE COMPANY OR THE EXTENT TO WHICH FUNDS AVAILABLE
TO THE COMPANY WILL BE SUFFICIENT TO PAY THE COST OF COMPLETION OF THE PROJECT WORK. THE COMPANY ACKNOWLEDGES THAT THE AGENCY
IS NOT THE MANUFACTURER OF THE EQUIPMENT NOR THE MANUFACTURER’S AGENT NOR A DEALER THEREIN. THE COMPANY, ON BEHALF OF ITSELF,
IS SATISFIED THAT THE FACILITY IS SUITABLE AND FIT FOR PURPOSES OF THE COMPANY. THE AGENCY SHALL NOT BE LIABLE IN ANY MANNER WHATSOEVER
TO THE COMPANY OR ANY OTHER PERSON FOR ANY LOSS, DAMAGE OR EXPENSE OF ANY KIND OR NATURE CAUSED, DIRECTLY OR INDIRECTLY, BY THE
PROPERTY OF THE FACILITY OR THE USE OR MAINTENANCE THEREOF OR THE FAILURE OF OPERATION THEREOF, OR THE REPAIR, SERVICE OR ADJUSTMENT
THEREOF, OR BY ANY DELAY OR FAILURE TO PROVIDE ANY SUCH MAINTENANCE, REPAIRS, SERVICE OR ADJUSTMENT, OR BY ANY INTERRUPTION OF
SERVICE OR LOSS OF USE THEREOF OR FOR ANY LOSS OF BUSINESS HOWSOEVER CAUSED.


 






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ARTICLE
V


PILOT PAYMENTS; SALES TAX EXEMPTION; MORTGAGE RECORDING TAX EXEMPTION AND RECAPTURE OF BENEFITS


 


Section
5.1     PILOT Payments.


 


(a)          
As long as this Lease Agreement is in effect, the Company agrees to make payments in lieu of all real estate taxes and assessments
(the “PILOT Payments”) (in addition to paying all special ad valorem levies, special assessments or Special
District Taxes and service charges against real property located in the Town of Canandaigua, Canandaigua City School District,
Ontario County (including any existing incorporated village or any village which may be incorporated after the date hereof, within
which the Facility is or may be wholly or partially located) (the “Taxing Authorities”) which are or may be
imposed for special improvements or special district improvements) which would be levied upon or with respect to the Facility
if the Facility were owned by the Company exclusive of the Agency’s leasehold interest (the “Taxes on the Facility”).
The method of calculation for such PILOT Payments are set forth in Exhibit C attached hereto. PILOT Payments shall be allocated
among the Taxing Authorities in proportion to the amount of real property tax and other taxes which would have been received by
each Taxing Authority if the Facility was owned by the Company exclusive of the Agency’s leasehold interest.


 


(b)          After
the effective date of this Lease Agreement and until the provisions of paragraph 5.1(c) become effective, the Company shall pay,
as payments in lieu of taxes and assessments, one hundred percent (100%) of the taxes and assessments that would be levied upon
the Facility by the respective Taxing Authorities if the Facility were owned by the company exclusive of the Agency’s leasehold
interest.


 






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(c)          Commencing
with the 2018/2019 School Tax Year and the 2019 General Tax Year, the Company shall pay, as PILOT Payments, the amounts set forth
on Exhibit C attached hereto and made a part hereof.


 


(d)          The
Company shall pay, or cause to be paid, the amounts set forth in subsections (a), (b) and (c) above, as applicable, after receipt
of tax bills from the Agency or the Taxing Authorities, as the case may be. Failure to receive a tax bill shall not relieve the
Company of its obligation to make all payments provided for hereunder. If, for any reason, the Company does not receive an appropriate
tax bill, the Company shall have the responsibility and obligation to make all reasonable inquiries to the Taxing Authorities
and to have such a bill issued, and thereafter to make payment of the same no later than the due dates provided therein. PILOT
Payments shall be made directly to the Taxing Authorities. PILOT Payments made after the due date(s) as set forth in the applicable
tax bills shall accrue interest (and penalties) at the rates applicable to late payments of taxes for the respective Taxing Authorities
and as further provided in the GML, including Section 874(5) thereof, which currently provides for an initial penalty of five
percent (5%) of the amount due and an additional penalty of one percent (1%) per month on payments more than one-month delinquent.
Anything contained in this paragraph (d) to the contrary notwithstanding, the Company shall have the obligation to make all annual
payments required by this paragraph (other than payments of penalties, if any) in two equal semi-annual installments on or prior
to January 31 and July 31 of each year of the Lease Term or on such other dates as may be established from time to time during
the Lease Term.


 


(e)          During
the Lease Term, the Company shall continue to pay all special ad valorem levies, special assessments, and service charges levied
against the Facility for special improvements or special district improvements.


 


(f)          In
the event that any structural addition shall be made to the building or buildings included in the Facility subsequent to the Completion
Date, or any additional building or improvement shall be constructed on the Land (such structural additions, buildings and improvements
being referred to hereinafter as “Additional Facilities”), the Company agrees to make additional payments in
lieu of taxes to the Taxing Authorities in amounts equal to the product of the then current ad valorem tax rates which would be
levied upon or with respect to the Additional Facilities by the Taxing Authorities if the Additional Facilities were owned by
the Company exclusive of the Agency’s leasehold interest times the assessment or assessments established for that tax year
by the respective Taxing Authorities having appropriate assessing jurisdiction. All other provisions of this Section 5.1 shall
apply to this obligation for additional payments.


 


(g)          In
the event that the Agency’s leasehold interest in the Facility or any part thereof terminates at such time in reference
to any taxable status date as to make it impossible to place such Facility or part thereof on the tax rolls of the Taxing Authorities,
or appropriate special districts, as the case may be, by such taxable status date, the Company hereby agrees to pay, at the first
time taxes or assessments are due following the taxable status date on which such Facility or part thereof is placed on the tax
rolls, an amount equal to the taxes or assessments which would have been levied on such Facility or part thereof had it been on
the tax rolls from the time of the termination of the Agency’s leasehold interest until the date of the tax rolls following
the taxable status date as of which such Facility or part thereof is placed on the tax rolls. There shall be deducted from such
amount any amounts previously paid pursuant to this Section 5.1 by the Agency or the Company to the respective Taxing Authorities
relating to any period of time after the date of termination of the Agency’s interest. The provisions of this subsection
(g) shall survive the termination or expiration of the Lease Agreement. Any rights the Company may have against its respective
designees are separate and apart from the terms of this subsection (g), and this subsection (g) shall survive any transfer from
the Agency to the Company.


 






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(h)          In
the event the Facility or any part thereof is declared to be subject to taxation for taxes or assessments by an amendment to the
Act or other legislative change or by a final judgment of a court of competent jurisdiction, the obligations of the Company under
this Section 5.1 shall, to such extent, be null and void.


 


(i)          In
the event the Company shall enter into a subsequent payment-in-lieu-of-tax agreement or agreements with respect to the Taxes on
the Facility directly with any or all Taxing Authorities in the jurisdiction of which the Facility is located, the obligations
of the Company under this Section 5.1, which are inconsistent with such future agreement or agreements, shall be superseded and
shall, to such extent, be null and void.


 


(j)          As
long as this Lease Agreement is in effect, the Agency and the Company agree that (i) the Company shall be deemed to be the owner
of the Facility and of the Additional Facilities for purposes of instituting, and shall have the right to institute, administrative
or judicial review of an assessment of the real estate with respect to the Facility and of the Additional Facilities pursuant
to the provisions of Article 7 of the Real Property Tax Law or any other applicable law, as the same may be amended from time
to time, and (ii) the Agency, at the request of the Company, shall request the Assessor of Town of Canandaigua, Ontario County,
or any other assessor having jurisdiction to assess the Facility, to take into consideration the value of surrounding properties
of like character when assessing the Facility. Notwithstanding the foregoing, in the event that the assessment of the real estate
with respect to the Facility and the Additional Facilities is reduced as a result of any such administrative or judicial review
so that such complaining party would be entitled to receive a refund or refunds of taxes paid to the respective Taxing Authorities,
if such complaining party were the owner of the Facility and the Additional Facilities exclusive of the Agency’s leasehold
interest therein, such complaining party shall not be entitled to receive a refund or refunds of the PILOT Payments paid pursuant
to this Lease Agreement and the PILOT Payments set forth on Exhibit C hereto shall not be reduced. In that event, such
complaining party shall be entitled to receive a credit against future PILOT Payments to be paid pursuant to this Lease Agreement,
as and when collected by the Agency or the respective Taxing Authorities (as the case may be), in an amount equal to any refund
that such complaining party would be entitled to receive if such complaining party were the owner of the Facility and the Additional
Facilities exclusive of the Agency’s leasehold interest therein; provided, however, that the Agency shall have no obligation
to provide a credit against PILOT Payments which it has remitted to any of the respective Taxing Authorities before the date the
Agency receives written notice from the complaining party that it seeks a credit. In no event shall the Agency be required to
remit to the Company or any Taxing Authority any moneys otherwise due as a result of a reduction in the assessment of the Facility
(or any part thereof) due to a certiorari review. If the Company receives a reduction in assessment in the last year of the Lease
Agreement after it has made its final payments in lieu of taxes, the Company acknowledges that it shall look solely to the Taxing
Authorities for repayment or for a credit against the first payment(s) of Taxes on the Facility which will be due after the Facility
is returned to the tax rolls. The Company hereby agrees that it will notify the Agency if the Company shall have requested a reassessment
of the Facility or a reduction in the taxes on the Facility or shall have instituted any tax certiorari proceedings with respect
to the Facility. The Company shall deliver to the Agency copies of all notices, correspondence, claims, actions and/or proceedings
brought by or against the Company in connection with any reassessment of the Facility, reduction of taxes with respect to the
Facility or tax certiorari proceedings with respect to the Facility.


 






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(k)          The
Company, in recognition of the benefits provided under the terms hereof, including, but not limited to, the PILOT Payments set
forth in Exhibit C hereto, and for as long as the Lease Agreement is in effect, expressly waives any rights it may have
for any exemption under Section 485-b of the Real Property Tax Law or any other exemption under any other law or regulation (except,
however, for the exemption provided by Title 1 of Article 18-A of the GML) with respect to the Facility. The Company, however,
reserves any such rights with respect to the Additional Facilities as referred to in subsection (f) hereof and with respect to
the assessment and/or exemption of the Additional Facilities.


 


Section
5.2     Sales Tax Exemption.


 


(a)          The
Agency hereby appoints the Company its true and lawful agent, and the Company hereby accepts such agency (i) to complete the Project
Work in accordance with the Plans and Specifications, (ii) to make, execute, acknowledge and deliver any contracts, orders, receipts,
writings and instructions with any other Persons, and in general to do all things which may be requisite or proper, all for the
Project Work with the same powers and with the same validity as the Agency could do if acting on its own behalf, (iii) to pay
all fees, costs and expenses incurred in connection with the Project Work, (iv) to ask, demand, sue for, levy, recover and receive
all such sums of money, debts, dues and other demands whatsoever which may be due, owing and payable to the Agency under the terms
of any contract, order, receipt or writing in connection with the Project Work, and (v) to enforce the provisions of any contract,
agreement, obligation, bond or other performance security. This agency appointment expressly excludes the Company from purchasing
any motor vehicle, including any cars, trucks, vans or buses which are licensed by the Department of Motor Vehicles for use on
public highways or streets.


 


(b)          Agency’s
Exempt Status. The Agency constitutes a corporate governmental agency and a public benefit corporation under the laws of
the State of New York, and therefore, in the exercise of its governmental functions, is exempt from the imposition of Sales
and Use Taxes. As an exempt governmental entity, no exempt organization identification number has been issued to the Agency
nor is one required. Notwithstanding the foregoing, the Agency makes no representation to the Company, any Agent or any third
party that any Sales Tax Exemption is available under this Lease Agreement.


 






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(c)          Scope
of Authorization of Sales Tax Exemption. The Agency hereby authorizes the Company, subject to the terms and conditions of
this Lease Agreement, to act as its agent in connection with the Facility for the purpose of effecting purchases and leases of
Eligible Items so that such purchases and leases are exempt from the imposition of Sales and Use Taxes. The Agency’s authorization
with respect to such Sales Tax Exemption provided to the Company and its Agents pursuant to this Lease Agreement and any Sales
Tax Agent Authorization Letters issued hereunder shall be subject to the following limitations:


 


		(i)	The
                                         Sales Tax Exemption shall be effective only for a term commencing on the Closing Date
                                         and expiring upon the earliest of (A) the termination of this Lease Agreement, (B) the
                                         Completion Date, (C) failure of the Company to file Form ST-340, as described in Section
                                         5.2(g) below, (D) the termination of the Sales Tax Exemption authorization pursuant to
                                         Section 10.2 or (E) the date upon which the Company received the Maximum Company Sales
                                         Tax Savings Amount.



 


		(ii)	The
                                         Sales Tax Exemption authorization set forth herein shall automatically be suspended upon
                                         written notice to the Company that the Company is in default under this Lease Agreement
                                         until such default is cured to the satisfaction of the Agency.



 


		(iii)	The
                                         Sales Tax Exemption authorization shall be subject to all of the terms, conditions and
                                         provisions of this Lease Agreement.



 


		(iv)	The
                                         Sales Tax Exemption shall only be utilized for Eligible Items which shall be purchased,
                                         incorporated, completed or installed for use only by the Company at the Facility (and
                                         not with any intention to sell, transfer or otherwise dispose of any such Eligible Item
                                         to a Person as shall not constitute the Company), it being the intention of the Agency
                                         and the Company that the Sales Tax Exemption shall not be made available with respect
                                         to any Eligible Item unless such item is used solely by the Company at the Facility.



 


		(v)	The
                                         Sales Tax Exemption shall not be used for any Ineligible Item.



 


		(vi)	The
                                         Sales Tax Exemption shall not be used to benefit any person or entity, including any
                                         tenant or subtenant located at the Facility, other than the Company, without the prior
                                         written consent of the Agency.



 


		(vii)	By
                                         execution by the Company of this Lease Agreement, the Company agrees to accept the terms
                                         hereof and represents and warrants to the Agency that the use of the Sales Tax Exemption
                                         by the Company or by any Agent is strictly for the purposes stated herein.



 






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		(viii)	Upon the Termination Date, the Company and each Agent shall cease being agents of the Agency, and
the Company shall immediately notify each Agent in writing of such termination and that the Sales Tax Agent Authorization Letter
issued to any such Agent is likewise terminated.



 


		(ix)	The Company agrees that the aggregate amount of Company Sales Tax Savings realized by the Company
and by all Agents of the Company, if any, in connection with the Facility shall not exceed in the aggregate the Maximum Company
Sales Tax Savings Amount.



 


(d)          Procedures
for Appointing Agents. If the Company desires to seek the appointment of a contractor, a subcontractor or other party to act
as the Agency’s agent (an “Agent”) for the purpose of effecting purchases which are eligible for the Sales
Tax Exemption pursuant to authority of this Lease Agreement, it must complete the following steps:


 


		(i)	For each Agent, the Company must complete and submit Form ST-60 to the Agency. The foregoing is
required pursuant to the GML Section 874(9) and Form ST-60 and the regulations relating thereto which require that within thirty
(30) days of the date that the Agency appoints a project operator or other person or entity to act as agent of the Agency for purposes
of extending a sales or use tax exemption to such person or entity, the Agency must file a completed Form ST-60 with respect to
such person or entity.



 


		(ii)	Following receipt by the Agency of the completed Form ST-60, such Agent must be appointed as Agent
by the Agency, by execution by the Agency and the Agent of a Sales Tax Agent Authorization Letter in the form attached hereto as
Exhibit E. The determination whether to approve the appointment of an Agent shall be made by the Agency, in its sole discretion.
If executed, a completed copy of the Sales Tax Agent Authorization Letter shall be sent to the Company. The Company must also provide
a copy of an executed Sales Tax Agent Authorization Letter together with a copy of this Lease Agreement to the Agent within five
(5) Business Days after receipt thereof by the Company.



 


		(iii)	The Company shall ensure that each Agent shall observe and comply with the terms and conditions
of its Sales Tax Agent Authorization Letter and this Lease Agreement.



 


(e)          Form ST-60
Not an Exemption Certificate. The Company acknowledges that the executed Form ST-60 designating the Company or any Agent
as an agent of the Agency shall not serve as a sales or use tax exemption certificate or document. Neither the Company nor any
other Agent may tender a copy of the executed Form ST-60 to any person required to collect sales tax as a basis to make such purchases
exempt from tax. No such person required to collect sales or use taxes may accept the executed Form ST-60 in lieu of collecting
any tax required to be collected. THE CIVIL AND CRIMINAL PENALTIES FOR MISUSE OF A COPY OF FORM ST-60 AS AN EXEMPTION CERTIFICATE
OR DOCUMENT OR FOR FAILURE TO PAY OR COLLECT TAX SHALL BE AS PROVIDED IN THE TAX LAW. IN ADDITION, THE USE BY AN AGENT, THE COMPANY,
OR OTHER PERSON OR ENTITY OF SUCH FORM ST-60 AS AN EXEMPTION CERTIFICATE OR DOCUMENT SHALL BE DEEMED TO BE, UNDER ARTICLES TWENTY-EIGHT
AND THIRTY-SEVEN OF THE TAX LAW, THE ISSUANCE OF A FALSE OR FRAUDULENT EXEMPTION CERTIFICATE OR DOCUMENT WITH THE INTENT TO EVADE
TAX.


 






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(f)           Form ST-123
Requirement. As an agent of the Agency, the Company agrees that it will, and will cause each Agent to, present to each
seller or vendor a completed and signed Form ST-123 for each contract, agreement, invoice, bill or purchase order entered into
by the Company or by any Agent, as agent for the Agency, for the Project Work. Form ST-123 requires that each seller or vendor
accepting Form ST-123 identify the Facility on each bill or invoice for purchases and indicate on the bill or invoice that the
Agency or Agent or Company, as project operator of the Agency, was the purchaser. For the purposes of indicating who the purchaser
is, each bill or invoice should state, “I, [Company/Agent], certify that I am duly appointed agent of the Ontario County
Industrial Development Agency and that I am purchasing the tangible personal property or services for use in the Akoustis, Inc.
2018 Facility located at 5450 Campus Drive, Canandaigua, Ontario County, New York, IDA Project Number [__].” The Company
shall retain copies of all such contracts, agreements, invoices, bills and purchase orders for a period of not less than six (6)
years from the date thereof. For each Agent the Form ST-123 shall be completed as follows: (i) the “Project information”
section of Form ST-123 should be completed using the name and address of the Facility as indicated on the Form ST-60 used to appoint
the Agent; (ii) the date that the Agent was appointed as an agent should be completed using the date of the Agent’s Sales
Tax Agent Authorization Letter; and (iii) the “Exempt purchases” section of Form ST-123 should be completed by marking
“X” in box “A” only.


 


(g)          Form ST-340
Filing Requirement. The Company shall annually (currently, by each February 1st with respect to the prior calendar year)
file a Form ST-340 with NYSDTF, and with a copy to the Agency, in a manner consistent with such regulations as is or may be prescribed
by the Commissioner of NYSDTF (the “Commissioner”), of the value of all Company Sales Tax Savings claimed by
the Company and each Agent in connection with the Facility. Should the Company fail to comply with the foregoing requirement, the
Company and each Agent shall immediately cease to be agents of the Agency in connection with the Facility without any further action
of the Agency and the Company shall immediately and without demand notify each Agent appointed by the Agency in connection with
the Facility of such termination.


 


(h)          Sales
Tax Registry Filing Requirement. No later than August 1st of each year, the Company shall file with the Agency a completed
Sales Tax Registry, in the form attached hereto as Exhibit F, which accounts for all Company Sales Tax Savings realized
by the Company and each Agent during the prior annual period ending on the preceding June 30th (or such shorter period beginning
on the Closing Date and ending on the preceding June 30th), unless the Termination Date occurred prior to such June 30th. Within
ten (10) days after the Termination Date, the Company shall file with the Agency a completed Sales Tax Registry which accounts
for all Company Sales Tax Savings realized by the Company and each Agent during the period from the preceding July 1st to the Termination
Date.


 






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(i)           Special Provisions
Relating to State Sales Tax Savings.


 


		(i)	The Company covenants and agrees to comply, and to cause each of its contractors, subcontractors,
Agents, persons or entities to comply, with the requirements of GML Sections 875(1) and (3) (the “Special Provisions”),
as such provisions may be amended from time to time. In the event of a conflict between the other provisions of this Lease Agreement
and the Special Provisions, the Special Provisions shall control.



 


		(ii)	The Company acknowledges and agrees that pursuant to GML Section 875(3), the Agency shall have
the right to recover, recapture, receive, or otherwise obtain from the Company, State Sales Tax Savings taken or purported to be
taken by the Company, any Agent or any other person or entity acting on behalf of the Company to which the Company is not entitled
or which are in excess of the Maximum Company Sales Tax Savings Amount or which are for property or services not authorized or
taken in cases where the Company, any Agent or any other person or entity acting on behalf of the Company failed to comply with
a material term or condition to use property or services in the manner required by this Lease Agreement. The Company shall, and
shall require each Agent and any other person or entity acting on behalf of the Company, to cooperate with the Agency in its efforts
to recover, recapture, receive, or otherwise obtain such State Sales Tax Savings and shall promptly pay over any such amounts to
the Agency that it requests. The failure to pay over such amounts to the Agency shall be grounds for the Commissioner to assess
and determine State Sales and Use Taxes due from the Company under Article 28 of the New York State Tax Law, together with any
relevant penalties and interest due on such amounts.



 


(j)           Subject
to the provisions of subsection (i) above, in the event that the Company or any Agent shall utilize the Sales Tax Exemption in
violation of the provisions of this Lease Agreement or any Sales Tax Agent Authorization Letter, the Company shall promptly deliver
notice of same to the Agency, and the Company shall, upon demand by the Agency, pay to or at the direction of the Agency a return
of sales or use tax exemptions in an amount equal to all such unauthorized sales or use tax exemptions together with interest at
the rate of twelve percent (12%) per annum compounded daily from the date and with respect to the dollar amount for which each
such unauthorized sales or use tax exemption was availed of by the Company or any Agent (as applicable).


 


(k)          Upon
request by the Agency with reasonable notice to the Company, the Company shall make available at reasonable times to the Agency
and/or the Independent Accountant all such books, records, contracts, agreements, invoices, bills or purchase orders of the Company
and any Agent, and require all appropriate officers and employees of the Company to respond to reasonable inquiries by the Agency
and/or the Independent Accountant, as shall be necessary (y) to indicate in reasonable detail those costs for which the Company
or any Agent shall have utilized the Sales Tax Exemption and the dates and amounts so utilized, and (z) to permit the Agency
to determine any amounts owed by the Company under this Section 5.2.


 






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Section
5.3           Mortgage Recording
Tax Exemption. Section 874 of the Act exempts the Agency from paying certain mortgage recording taxes except for the portion
of the mortgage recording tax allocated to transportation districts referenced in Section 253(2)(a) of the Tax Law. The Agency
hereby grants to the Company exemption from mortgage recording taxes for one or more Mortgages securing an aggregate principal
amount not to exceed $12,000,000, or such greater amount as approved by the Agency in its sole and absolute discretion, in
connection with the financing of the Project Work and any future financing, refinancing or permanent financing of the costs of
the Project Work for the Facility (the “Mortgage Recording Tax Exemption”). The Company represents and warrants
(1) that the real property secured by the Mortgage is located within a transportation district referenced in Section 253(2)(a)
of the Tax Law, and (2) that upon recording the Mortgage, the Company shall pay the mortgage recording tax allocated to transportation
districts referenced in Section 253(a)(2) of the Tax Law.


 


Section 5.4           Recapture of Agency Benefits.


 


(a)          It
is understood and agreed by the parties hereto that the Agency is entering into this Lease Agreement in order to provide financial
assistance to the Company for the Facility and to accomplish the public purposes of the Act. In consideration therefor, the Company
hereby agrees as follows:


 


		(i)	If there shall occur a Recapture Event after the Closing Date, but on or before December 31, 2021,
the Company shall pay to the Agency, or to the State of New York, if so directed by the Agency (except as otherwise specified below)
as a return of public benefits conferred by the Agency, one hundred percent (100%) of the Recaptured Benefits (as defined below);



 


		(ii)	If there shall occur a Recapture Event on or after January 1, 2022 but on or before December 31,
2023, the Company shall pay to the Agency, or to the State of New York, if so directed by the Agency (except as otherwise specified
below) as a return of public benefits conferred by the Agency, seventy-five percent (75%) of the Recaptured Benefits;



 


		(iii)	If there shall occur a Recapture Event on or after January 1, 2024 but on or before December 31,
2025, the Company shall pay to the Agency, or to the State of New York, if so directed by the Agency (except as otherwise specified
below) as a return of public benefits conferred by the Agency, fifty percent (50%) of the Recaptured Benefits;



 






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		(iv)	If there shall occur a Recapture Event on or after January 1, 2026 but on or before December 31,
2026, the Company shall pay to the Agency, or to the State of New York, if so directed by the Agency (except as otherwise specified
below) as a return of public benefits conferred by the Agency, twenty-five percent (25%) of the Recaptured Benefits; and



 


		(v)	If there shall occur a Recapture Event on or after January 1, 2027, the Company shall not be obligated
to pay to the Agency, or to the State of New York, any of the Recaptured Benefits; and



 


(b)          The
term “Recaptured Benefits” shall mean all direct monetary benefits, tax exemptions and abatements and other
financial assistance, if any, derived solely from the Agency’s participation in the transaction contemplated by the Lease
Agreement including, but not limited to, the amount equal to 100% of:


 


		(i)	the Mortgage Recording Tax Exemption; and



 


		(ii)	Sales Tax Exemption savings realized by or for the benefit of the Company, including any savings
realized by any Agent pursuant to the Lease Agreement and each Sales Tax Agent Authorization Letter issued in connection with the
Facility (the “Company Sales Tax Savings”); and



 


		(iii)	real property tax abatements granted pursuant to Section 5.1 hereof (the “Real Property
Tax Abatements”);



 


which Recaptured Benefits from time to
time shall upon the occurrence of a Recapture Event in accordance with the provisions of subsection (c) below and the declaration
of a Recapture Event by notice from the Agency to the Company be payable directly to the Agency or the State of New York if so
directed by the Agency within ten (10) days after such notice.


 


(c)          The
term “Recapture Event” shall mean any of the following events:


 


		(i)	The occurrence and continuation of an Event of Default under this Lease Agreement (other than as
described in clause (iv) below or in subsections (d) or (e) below) which remains uncured beyond any applicable notice and/or grace
period, if any, provided hereunder; or



 


		(ii)	The Facility shall cease to be a “project” within the meaning of the Act, as in effect
on the Closing Date, through the act or omission of the Company; or



 


		(iii)	The sale of the Facility or closure of the Facility and/or departure of the Company from Ontario
County, except as due to casualty, condemnation or force majeure as provided in subsection (e) below or as provided in Section
9.3 hereof; or



 






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		(iv)	Failure of the Company to create or cause to be maintained the number of FTE jobs at the Facility
as provided in Section 8.11 of the Lease Agreement, which failure is not reflective of the business conditions of the Company
or the subtenants of the Company, including without limitation loss of major sales, revenues, distribution or other adverse business
developments and/or local, national or international economic conditions, trade issues or industry wide conditions; or



 


		(v)	Any significant deviations from the Project Application Information which would constitute a significant
diminution of the Company’s activities in, or commitment to, Ontario County, New York; or



 


		(vi)	The Company receives Sales Tax Savings in connection with the Project Work in excess of the Maximum
Company Sales Tax Savings Amount; provided, however, that the foregoing shall constitute a Recapture Event with respect to such
excess Sales Tax Savings only. It is further provided that failure to repay the Sales Tax Savings within thirty (30) days shall
constitute a Recapture Event with respect to all Recapture Benefits.



 


(d)          Provided,
however, if a Recapture Event has occurred due solely to the failure of the Company to create or cause to be maintained the number
of FTEs at the Facility as provided in Section 8.11 hereof in any Tax Year but the Company has created or caused to be maintained
at least 90% of such required number of FTEs for such Tax Year, then in lieu of recovering the Recaptured Benefits provided above,
the Agency may, in its sole discretion, adjust the PILOT Payments due hereunder on a pro rata basis so that the amounts payable
will be adjusted upward retroactively for such Tax Year by the same percentage as the percentage of FTEs that are below the required
FTE level for such Tax Year. Such adjustments to the PILOT Payments may be made each Tax Year until such time as the Company has
complied with the required number of FTEs pursuant to Section 8.11 hereof.


 


(e)          Furthermore,
notwithstanding the foregoing, a Recapture Event shall not be deemed to have occurred if the Recapture Event shall have arisen
as a result of (i) a “force majeure” event (as more particularly defined in Section 10.1(b) hereof), (ii) a taking
or condemnation by governmental authority of all or part of the Facility, or (iii) the inability or failure of the Company after
the Facility shall have been destroyed or damaged in whole or in part (such occurrence a “Loss Event”) to rebuild,
repair, restore or replace the Facility to substantially its condition prior to such Loss Event, which inability or failure shall
have arisen in good faith on the part of the Company or any of its affiliates so long as the Company or any of its affiliates have
diligently and in good faith using commercially reasonable efforts pursued the rebuilding, repair, restoration or replacement of
the Facility or part thereof.


 






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(f)           The
Company covenants and agrees to furnish the Agency with written notification (i) within sixty (60) days of the end of each Tax
Year the number of FTEs located at the Facility for such Tax Year, and (ii) within thirty (30) days of actual notice of any facts
or circumstances which would likely lead to a Recapture Event or constitute a Recapture Event hereunder. The Agency shall notify
the Company of the occurrence of a Recapture Event hereunder, which notification shall set forth the terms of such Recapture Event.


 


(g)          In
the event any payment owing by the Company under this Section shall not be paid on demand by the Agency, such payment shall bear
interest from the date of such demand at a rate equal to one percent (1%) plus the Prime Rate, but in no event at a rate higher
than the maximum lawful prevailing rate, until the Company shall have made such payment in full, together with such accrued interest
to the date of payment, to the Agency (except as otherwise specified above).


 


(h)          The
Agency shall be entitled to deduct all reasonable out of pocket expenses of the Agency, including without limitation, reasonable
legal fees, incurred with the recovery of all amounts due under this Section 5.4, from amounts received by the Agency pursuant
to this Section 5.4.


 


ARTICLE
VI

MAINTENANCE, MODIFICATIONS, TAXES AND INSURANCE


 


Section
6.1            Maintenance and Modifications
of Facility by Company.


 


(a)          The
Company shall not abandon the Facility or cause or permit any waste to the Improvements. During the Lease Term, the Company shall
not remove any material part of the Facility outside of the jurisdiction of the Agency and shall (i) keep the Facility or
cause the Facility to be kept in as reasonably safe condition as its operations shall permit; (ii) make all necessary repairs
and replacements to the Facility; and (iii) operate the Facility in a sound and economic manner.


 


(b)          The
Company from time to time may make any structural additions, modifications or improvements to the Facility or any part thereof,
provided such actions do not adversely affect the structural integrity of the Facility.  The Company may not make any changes
to the footprint of the Facility, and any additions expanding the square footage of the Facility (including the addition of any
stories whether above or below ground) or make any additions, modifications or improvements to the Facility which will materially
and/or adversely affect the structural integrity or value of the Facility without the prior written consent of the Agency which
consent shall not be unreasonably withheld or delayed. All such additions, modifications or improvements made by the Company after
the date hereof shall become a part of the Facility and the Property of the Agency. The Company agrees to deliver to the Agency
all documents which may be necessary or appropriate to convey to the Agency title to or an interest in such Property.


 






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Section 6.2            Installation
of Additional Equipment. Subject to the provisions of Section 3.5 hereof, the Company or any permitted sublessee of the
Company from time to time may install additional machinery, equipment or other personal property in the Facility (which may be
attached or affixed to the Facility), and such machinery, equipment or other personal property shall not become, or be deemed
to become, a part of the Facility, so long as such additional property is properly identified by such appropriate records, including
computerized records, as approved by the Agency. The Company from time to time may create or permit to be created any Lien on
such machinery, equipment or other personal property. Further, the Company from time to time may remove or permit the removal
of such machinery, equipment and other personal property from the Facility, provided that any such removal of such machinery,
equipment or other personal property shall not occur: (i) if any Event of Default has occurred or (ii) if any such removal
shall adversely affect the structural integrity of the Facility or impair the overall operating efficiency of the Facility for
the purposes for which it is intended, and provided further, that if any damage to the Facility is occasioned by such removal,
the Company agrees promptly to repair or cause to be repaired such damage at its own expense.


 


Section 6.3            Taxes,
Assessments and Utility Charges.


 


(a)          Subject
to the Sales Tax Exemption and the Real Property Tax Abatements as provided hereunder, the Company agrees to pay, as the same become
due and before any fine, penalty, interest (except interest which is payable in connection with legally permissible installment
payments) or other cost which may be added thereto or become due or be imposed by operation of law for the non-payment thereof,
(i) all taxes, PILOT Payments and governmental charges of any kind whatsoever which may at any time be lawfully assessed or
levied against or with respect to the Facility and any machinery, equipment or other Property installed or brought by the Company
therein or thereon, including, without limiting the generality of the foregoing, any sales or use taxes imposed with respect to
the Facility or any part or component thereof, or the rental or sale of the Facility or any part thereof, and any taxes levied
upon or with respect to the income or revenues of the Agency from the Facility; (ii) all utility and other charges, including
service charges, incurred or imposed for or with respect to the operation, maintenance, use, occupancy, upkeep and improvement
of the Facility; and (iii) all assessments and charges of any kind whatsoever lawfully made by any governmental body for public
improvements; provided that, with respect to special assessments or other governmental charges that may lawfully be paid in installments
over a period of years, the Company shall be obligated under this Lease Agreement to pay only such installments as are required
to be paid during the Lease Term.


 


(b)          The
Company may in good faith contest any such taxes, assessments and other charges. In the event of any such proceedings, the Company
may permit the taxes, assessments or other charges so contested to remain unpaid during the period of such proceedings and any
appeal therefrom, provided, however, that (i) neither the Facility nor any part thereof or interest therein would be in any
immediate danger of being sold, forfeited or lost by reason of such proceedings and (ii) the Company shall have set aside
on its books adequate reserves with respect thereto and shall have furnished such security, if any, as may be required in such
proceedings or requested by the Agency.


 






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(c)          The
Agency agrees that if it or the Company contests any taxes, assessments or other charges provided for in paragraph (b) hereof,
all sums returned and received by the Agency, as a result thereof, will be promptly transmitted by the Agency to the Company and
that the Company shall be entitled to retain all such amounts; which such obligation shall survive the expiration or termination
of this Lease Agreement.


 


(d)          Within
thirty (30) days of receipt of written request therefor, the Company shall deliver to the Agency, official receipts of the appropriate
taxing authorities or other proof reasonably satisfactory to the Agency evidencing payment of any tax.


 


Section 6.4            Insurance
Required. At all times throughout the Lease Term, including, when indicated herein, during the Construction Period, if any,
the Company shall, at its sole cost and expense, maintain or cause to be maintained insurance against such risks and for such
amounts as are customarily insured against by facilities of like size and type and shall pay or cause to be paid, as the same
become due and payable, all premiums with respect thereto, including, but not necessarily limited to:


 


(a)          Insurance
against loss or damage by fire, lightning and other casualties customarily insured against, with a uniform standard extended coverage
endorsement, in an amount not less than the full replacement value of the completed Improvements, exclusive of footings and foundations,
as determined by a recognized appraiser or insurer selected by the Company, but in no event less than the greater of $1,000,000
or the amount as may be required by any Lender. During the Construction Period, such policy shall be written in the so-called “Builder’s
Risk Completed Value Non-Reporting Form” and shall contain a provision granting the insured permission to complete and/or
occupy.


 


(b)          Workers’
compensation insurance, disability benefits insurance and each other form of insurance which the Company or any permitted sublessee
is required by law to provide, covering loss resulting from injury, sickness, disability or death of employees of the Company or
any permitted sublessee who are located at or assigned to the Facility. This coverage shall be in effect from and after the Completion
Date or on such earlier date as any employees of the Company, any permitted sublessee, any contractor or subcontractor first occupy
the Facility.


 


(c)          Insurance
protecting the Agency and the Company against loss or losses from liability imposed by law or assumed in any written contract (including
the contractual liability assumed by the Company under Section 8.2 hereof) or arising from personal injury, including bodily injury
or death, or damage to the property of others, caused by an accident or other occurrence, with a limit of liability of not less
than $1,000,000 (combined single limit or equivalent for personal injury, including bodily injury or death, and property damage);
comprehensive automobile liability insurance covering all owned, non-owned and hired autos, with a limit of liability of not less
than $1,000,000 (combined single limit or equivalent protecting the Agency and the Company against any loss, liability or damage
for personal injury, including bodily injury or death, and property damage); and blanket excess liability coverage, in an amount
not less than $5,000,000 combined single limit or equivalent, protecting the Agency and the Company against any loss or liability
or damage for personal injury, including bodily injury or death, or property damage. This coverage shall also be in effect during
the Construction Period.


 






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(d)          During
the Construction Period, if any (and for at least one year thereafter in the case of Products and Completed Operations as set forth
below), the Company shall cause the general contractor to carry liability insurance of the type and providing the minimum limits
set forth below:


 


(i)          Workers’
compensation and employer’s liability with limits in accordance with applicable law.


 


(ii)         Comprehensive
general liability providing coverage for:


 


Premises and Operations 


Products and Completed Operations 


Owners Protective 


Contractors Protective 


Contractual Liability 


Personal Injury Liability 


Broad Form Property Damage 


(including completed operations) 


Explosion Hazard 


Collapse Hazard 


Underground Property Damage Hazard


 


Such insurance shall have a limit
of liability of not less than $1,000,000 (combined single limit for personal injury, including bodily injury or death, and property
damage).


 


(iii)        Comprehensive
auto liability, including all owned, non-owned and hired autos, with a limit of liability of not less than $1,000,000 (combined
single limit for personal injury, including bodily injury or death, and property damage).


 


(iv)        Excess
“umbrella” liability providing liability insurance in excess of the coverages in (i), (ii) and (iii) above with a limit
of not less than $5,000,000.


 


(e)          A
policy or policies of flood insurance in an amount not less than the greater of $1,000,000 or the amount that may be required by
any Lender or the maximum amount of flood insurance available with respect to the Facility under the Flood Disaster Protection
Act of 1973, as amended, whichever is less. This requirement will be waived upon presentation of evidence satisfactory to the Agency
that no portion of the Land is located within an area identified by the U.S. Department of Housing and Urban Development as having
special flood hazards.


 


(f)          The
Agency does not in any way represent that the insurance specified in this Lease Agreement, whether in scope or coverage or limits
of coverage, is adequate or sufficient to protect the Company’s business or interests.


 






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Section 6.5             Additional Provisions Respecting Insurance.


 


(a)          All
insurance required by Section 6.4 hereof shall be procured and maintained in financially sound and generally recognized responsible
insurance companies authorized to write such insurance in the State and selected by the entity required to procure the same. The
company issuing the policies required by Section 6.4(a) and (e) shall be rated “A” or better by A.M. Best Co.,
Inc. in Best’s Key Rating Guide. Such insurance may be written with deductible amounts comparable to those on similar policies
carried by other companies engaged in businesses similar in size, character and other respects to those in which the procuring
entity is engaged. All policies of insurance required by Section 6.4 hereof shall provide for at least thirty (30) days’
prior written notice to the Agency of the restriction, cancellation or modification thereof. The policy evidencing the insurance
required by Section 6.4(c) hereof shall name the Agency as an additional insured. All policies evidencing the insurance required
by Section 6.4(d)(ii), (iii) and (iv) shall name the Agency and the Company as additional insureds. The Agency acknowledges
that a mortgage and security interest in the policies of insurance required by Section 6.4(a) and the Net Proceeds thereof
have been or may be granted by the Company to any Lender pursuant to the Mortgage, and the Agency consents thereto. The Agency
hereby acknowledges that upon request of any Lender, the Company will assign and deliver (which assignment shall be deemed to be
automatic and to have occurred upon the occurrence of an Event of Default under any Mortgage) to any Lender the policies of insurance
required under Section 6.4(a), so and in such manner and form that any Lender shall at all times, upon such request and until
the payment in full of any Loan, have and hold said policies and the Net Proceeds thereof as collateral and further security under
any Mortgage for the payment of any Loan. The policies required under Section 6.4(a) shall contain appropriate waivers of
subrogation.


 


(b)          The
certificates of insurance required by Section 6.4(a), (c) and (e) hereof shall be deposited with the Agency on or before the
Closing Date. A copy of the certificates of insurance required by Section 6.4(d)(ii), (iii) and (iv) hereof shall be delivered
to the Agency on or before the commencement of any Construction Period. The Company shall deliver to the Agency before the first
Business Day of each calendar year thereafter a certificate dated not earlier than the immediately preceding month reciting that
there is in full force and effect, with a term covering at least the next succeeding calendar year, insurance of the types and
in the amounts required by Section 6.4 hereof and complying with the additional requirements of Section 6.5(a) hereof.
Prior to the expiration of each such policy or policies, the Company shall furnish to the Agency and any other appropriate Person
a new policy or policies of insurance or evidence that such policy or policies have been renewed or replaced or are no longer required
by this Lease Agreement. The Company shall provide such further information with respect to the insurance coverage required by
this Lease Agreement as the Agency may from time to time reasonably require.


 


Section 6.6           
Application of Net Proceeds of Insurance. The Net Proceeds of the insurance carried pursuant to the provisions of
Section 6.4 hereof shall be applied as follows: (i) the Net Proceeds of the insurance required by Section 6.4(a)
and (e) hereof shall be applied as provided in Section 7.l hereof, and (ii) the Net Proceeds of the insurance required
by Section 6.4(b), (c) and (d) hereof shall be applied toward extinguishment or satisfaction of the liability with respect
to which such insurance proceeds may be paid.


 






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Section 6.7           
Right of Agency to Pay Taxes, Insurance Premiums and Other Charges. If the Company fails, beyond the expiration of
any applicable notice and cure periods, (i) to pay any tax, together with any fine, penalty, interest or cost which may have
been added thereto or become due or been imposed by operation of law for nonpayment thereof, PILOT Payment, assessment or other
governmental charge required to be paid by Section 6.3 hereof (unless contested in accordance with the provisions of Section
6.3), (ii) to maintain any insurance required to be maintained by Section 6.4 hereof, (iii) to pay any amount required
to be paid by any law or ordinance relating to the use or occupancy of the Facility or by any requirement, order or notice of violation
thereof issued by any governmental person, (iv) to pay any mechanic’s Lien which is recorded or filed against the Facility
or any part thereof (unless contested in accordance with the provisions of Section 8.8(b) hereof), or (v) to pay any
other amount or perform any act required to be paid or performed by the Company hereunder, the Agency may pay or cause to be paid
such tax, PILOT Payment, assessment or other governmental charge, premium for such insurance or any such other payment, or may
perform any such act. No such payment shall be made or act performed by the Agency until at least ten (10) days shall have elapsed
since notice shall have been given by the Agency, and in the case of any tax, assessment or governmental charge or the amounts
specified in clauses (i) and (iv) hereof, no such payment shall be made in any event if the Company is contesting the same
in good faith to the extent and as permitted by this Lease Agreement, unless an Event of Default hereunder shall have occurred
and be continuing. No such payment by the Agency shall affect or impair any rights of the Agency hereunder arising in consequence
of such failure by the Company. The Company shall, on demand, reimburse the Agency for any amount so paid or for expenses or costs
incurred in the performance of any such act by the Agency pursuant to this Section (which shall include all reasonable legal fees
and disbursements), together with interest thereon, from the date of payment of such amount, expense or cost by the Agency at a
rate equal to two percent (2%) plus the Prime Rate, but in no event higher than the maximum lawful prevailing rate.


 


ARTICLE
VII

DAMAGE, DESTRUCTION AND CONDEMNATION


 


Section 7.1           
Damage or Destruction of the Facility.


 


(a)          If
the Facility or any part or component thereof shall be damaged or destroyed (in whole or in part) at any time during the Lease
Term:


 


(i)            the
Agency shall have no obligation to replace, repair, rebuild, restore or relocate the Facility;


 


(ii)           there
shall be no abatement or reduction in the amounts payable by the Company under this Lease Agreement, including, without limitation,
the PILOT Payments (whether or not the Facility is replaced, repaired, rebuilt, restored or relocated);


 


(iii)          the
Company shall promptly give written notice thereof to the Agency;


 






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(iv)          upon
the occurrence of such damage or destruction, the Net Proceeds derived from the insurance shall be (A) paid to the Company or the
Lender, as applicable, for the replacement, repair, rebuilding, restoration or relocation of the Facility as provided in Section
7.1(b) hereof or (B) applied pursuant to Section 7.1(e) hereof; and


 


(v)           if
the Facility is not replaced, repaired, rebuilt, restored or relocated, as provided herein and in Section 7.1(b) hereof, this
Lease Agreement shall be terminated at the option of the Agency and the provisions of Section 7.1(e) hereof shall apply.


 


(b)          Any
replacements, repairs, rebuilding, restorations or relocations of the Facility by the Company after the occurrence of such damage
or destruction shall be subject to the following conditions:


 


(i)            the
Facility shall be in substantially the same condition and value as an operating entity as existed prior to the damage or destruction;


 


(ii)           the
Facility shall continue to constitute a “project” as such term is defined in the Act;


 


(iii)          the
Facility will be subject to no Liens, other than Permitted Encumbrances; and


 


(iv)          any
other conditions the Agency may reasonably impose.


 


(c)          All
such repair, replacement, rebuilding, restoration or relocation of the Facility shall be effected with due diligence in a good
and workmanlike manner in compliance with all applicable legal requirements, shall be promptly and fully paid for by the Company
in accordance with the terms of the applicable contracts and shall automatically become a part of the Facility as if the same were
specifically provided herein.


 


(d)          In
the event such Net Proceeds are not sufficient to pay in full the costs of such repair, replacement, rebuilding, restoration or
relocation, the Company shall nonetheless complete the work, or cause the work to be completed pursuant to the terms of this Lease
Agreement, and pay from its own moneys, or cause to be paid by such other party as may be obligated for payment that portion of
the costs thereof in excess of such Net Proceeds. All such repairs, replacements, rebuilding, restoration or relocations made pursuant
to this Section, whether or not requiring the expenditure of the Company’s own money or moneys of any other person, shall
automatically become a part of the Facility as if the same were specifically described herein.


 


(e)          If
the Company shall not repair, replace, rebuild, restore or relocate the Facility, it shall be deemed to have exercised its option
to terminate this Lease Agreement pursuant to Section 11.1 hereof. Any Net Proceeds derived from insurance shall be applied
to the payment of the amounts required to be paid by Section 11.2 hereof and the balance shall be delivered to the Company.
If an Event of Default hereunder shall have occurred and the Agency shall have exercised its remedies under Section 10.2 hereof,
such Net Proceeds shall be applied to the payment of the amounts required to be paid by Section 10.2 and Section 10.4
hereof.


 






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Section 7.2           
Condemnation.


 


(a)          If
title to or use of the Facility shall be taken by Condemnation (in whole or in part) at any time during the Lease Term:


 


(i)            the
Agency shall have no obligation to repair, replace, rebuild, restore or relocate the Facility or to acquire, by construction or
otherwise, facilities of substantially the same nature as the Facility (“Substitute Facilities”);


 


(ii)           there
shall be no abatement or reduction in the amounts payable by the Company under this Lease Agreement including, without limitation,
the PILOT Payments (whether or not the Facility is repaired, replaced, rebuilt, restored or relocated or Substitute Facilities
are acquired);


 


(iii)          the
Company shall promptly give written notice thereof to the Agency;


 


(iv)          upon
the occurrence of such Condemnation, the Net Proceeds derived therefrom shall be (A) paid to the Company or the Lender, as applicable,
for the replacement, repair, rebuilding, restoration or relocation of the Facility or acquisition of Substitute Facilities as provided
in Section 7.2(b) hereof or (B) applied pursuant to Section 7.2(e) hereof; and


 


(v)           if
the Facility is not repaired, replaced, rebuilt, restored or relocated, as provided herein and in Section 7.2(b) hereof, this
Lease Agreement shall be terminated at the option of the Agency and the provisions of Section 7.2(e) hereof shall apply.


 


(b)          Any
repairs, replacements, rebuilding, restorations or relocations of the Facility by the Company after the occurrence of such Condemnation
or acquisitions by the Company of Substitute Facilities shall be subject to the following conditions:


 


(i)            the
Facility or the Substitute Facilities shall be in substantially the same condition and value as an operating entity as existed
prior to the Condemnation;


 


(ii)           the
Facility or the Substitute Facilities shall continue to constitute a “project” as such term is defined in the Act;


 


(iii)          the
Facility or the Substitute Facilities will be subject to no Liens, other than Permitted Encumbrances; and


 


(iv)          any
other conditions the Agency may reasonably impose.


 






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(c)          All
such repair, replacement, rebuilding, restoration or relocation of the Facility shall be effected with due diligence in a good
and workmanlike manner in compliance with all applicable legal requirements, shall be promptly and fully paid for by the Company
in accordance with the terms of the applicable contracts and shall automatically become a part of the Facility as if the same were
specifically described herein. Any Net Proceeds of a Condemnation not used to repair, replace, rebuild, restore, or relocate the
Facility shall belong to the Company.


 


(d)          In
the event such Net Proceeds are not sufficient to pay in full the costs of such repair, replacement, rebuilding, restoration, relocation
or acquisition of Substitute Facilities, the Company shall nonetheless complete, or cause to be completed, the work or the acquisition
pursuant to the terms of this Lease Agreement and pay from its own moneys, or cause to be paid by such other party as may be obligated
for payment, that portion of the costs thereof in excess of such Net Proceeds. All such repairs, replacements, rebuilding, restoration,
relocations and such acquisition of Substitute Facilities made pursuant to this Section, whether or not requiring the expenditure
of the Company’s own money or moneys of any other person, shall automatically become a part of the Facility as if the same
were specifically described herein.


 


(e)          If
the Company shall not repair, replace, rebuild or restore the Facility or acquire Substitute Facilities, it shall be deemed to
have exercised its option to terminate this Lease Agreement pursuant to Section 11.1 hereof. Any Net Proceeds derived from
the Condemnation shall be applied to the payment of the amounts required to be paid by Section 11.2 hereof. If any Event of
Default hereunder shall have occurred and the Agency shall have exercised its remedies under Section 10.2 hereof, such Net
Proceeds shall be applied to the payment of the amounts required to be paid by Section 10.2 and Section 10.4 hereof and
any balance remaining thereafter shall belong to the Company.


 


Section 7.3          
Condemnation of Company-Owned Property. The Company shall be entitled to the Net Proceeds of any casualty, damage
or destruction insurance proceeds or any Condemnation award or portion thereof made for damage to or taking of any Property which,
at the time of such damage or taking, is not part of the Facility.


 


Section 7.4           
Waiver of Real Property Law Section 227. The Company hereby waives the provisions of Section 227 of the
Real Property Law of the State or any law of like import now or hereafter in effect.


 


ARTICLE
VIII

SPECIAL COVENANTS


 


Section 8.1           
Right to Inspect Facility. Upon fifteen days (15) prior written notice and during regular business hours, the Agency
and its duly authorized agents shall have the right to inspect the Facility, including, without limitation, for the purpose of
ascertaining the condition of the Environment at, on or in the vicinity of the Facility, provided that (a) the Agency must obtain
pre-clearance from the Company, as to the individual(s) to perform the on-site inspection (“Inspectors”) and provide
Company with all information reasonably requested by Company (including name, residence and citizenship information), (b) the Agency
and its Inspectors must execute any confidentiality agreements deemed appropriate by the Company to permit the Company to maintain
the Facility’s status as a Defense Microelectronics Activity “Trusted Foundry”, (c) the Agency’s Inspectors
must be escorted by and comply with all instructions of Company staff, and (d) inspections and audits must not unreasonably interfere
with the operations of Company’s business.


 






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Section 8.2            
Hold Harmless Provisions.


 


(a)          The
Company agrees that the Agency, its directors, members, officers, agents (except the Company), and employees (the “Indemnified
Parties”) shall not be liable for and agrees to protect, defend, indemnify, save, release and hold the Indemnified Parties
harmless from and against any and all damages, losses, liabilities, obligations, penalties, claims, litigation, demands, defenses,
judgments, suits, actions, proceedings, costs, disbursements or expenses (including, without limitation, reasonable attorneys’
and experts’ fees, expenses and disbursements, incurred whether by reason of third party claims or to enforce the terms,
conditions and provisions of this Lease Agreement) of any kind or nature whatsoever which may at any time be imposed upon, incurred
by or asserted or awarded against the Agency relating to, resulting from or arising out of: (i) loss or damage to Property
or injury to or death of any and all Persons that may be occasioned by, directly or indirectly, any cause whatsoever pertaining
to the Facility or arising by reason of or in connection with the occupation or the use thereof or the presence of any Person or
Property on, in or about the Facility or the Land, (ii) the Project Work and the Agency’s acquisition, owning, leasing
and subleasing of the Facility, including, without limiting the generality of the foregoing, all claims arising from the breach
by the Company of any of its covenants contained herein, the exercise by the Company of the authority conferred upon it pursuant
to Section 5.2 of this Lease Agreement, and all causes of action and reasonable attorneys’ fees (whether by reason of third
party claims or by reason of the enforcement of any provision of this Lease Agreement (including without limitation this Section)
or any of the other documents delivered on the Closing Date by the Agency) and any other expenses incurred in defending any claims,
suits or actions which may arise as a result of any of the foregoing, (iii) the conditions of the Environment at, on or in the
vicinity of the Facility, (iv) the Project Work or the operation or use of the Facility in violation of any applicable Environmental
Law for the storage, treatment, generation, transportation, processing, handling, management, production or Disposal of any Hazardous
Substance or as a landfill or other waste disposal site, or for military, manufacturing or industrial purposes or for the commercial
storage of petroleum or petroleum based products, except in compliance with all applicable Environmental Laws, (v) the presence
of any Hazardous Substance or a Release or Disposal or the threat of a Release or Disposal of any Hazardous Substance or waste
on, at or from the Facility, (vi) the failure promptly to undertake and diligently pursue to completion all necessary, appropriate
and legally authorized investigative, containment, removal, clean-up and other remedial actions with respect to a Release or the
threat of a Release of any Hazardous Substance on, at or from the Facility, required by any Environmental Law, (vii) human
exposure to any Hazardous Substance, noises, vibrations or nuisances of whatever kind to the extent the same arise from the Project
Work, the condition of the Facility or the ownership, use, sale, operation, conveyance or operation thereof in violation of any
Environmental Law, (viii) a violation of any applicable Environmental Law, (ix) non-compliance with any Environmental
Permit, (x) a material misrepresentation or inaccuracy in any representation or warranty or a material breach of or failure
to perform any covenant made by the Company in this Lease Agreement, or (xi) the costs of any required or necessary investigation,
assessment, testing, repair, cleanup, or detoxification of the Facility and the preparation of any closure or other required plans;
provided that any such losses, damages, liabilities or expenses of the Agency are not incurred on account of and do not result
from the gross negligence or intentional or willful wrongdoing of the Indemnified Parties. The foregoing indemnities shall apply
notwithstanding the fault or negligence in part of any of the Indemnified Parties, and irrespective of the breach of a statutory
obligation or the application of any rule of comparative or apportioned liability. The foregoing indemnities are limited only to
the extent of any prohibitions imposed by law, and upon the application of any such prohibition by the final judgment or decision
of a competent court of law, the remaining provisions of these indemnities shall remain in full force and effect.


 






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(b)          Notwithstanding
any other provisions of this Lease Agreement, the obligations of the Company pursuant to this Section 8.2 shall remain in
full force and effect after the termination of this Lease Agreement until the expiration of the period stated in the applicable
statute of limitations during which a claim, cause of action or prosecution relating to the matters herein described may be brought,
the payment in full or the satisfaction of such claim, cause of action or prosecution relating to the matters herein described
and the payment of all expenses and charges incurred by the Indemnified Parties, relating to the enforcement of the provisions
herein specified. The liability of the Company to the Agency hereunder shall in no way be limited, abridged, impaired or otherwise
affected by (i) any amendment or modification of any of the Transaction Documents by or for the benefit of the Agency, the
Company or any subsequent owners or users of the Facility, (ii) any extensions of time for payment or performance required
by any of the Transaction Documents, (iii) the release of the Company or any other person from the performance or observance
of any of the agreements, covenants, terms or conditions contained in any of the Transaction Documents by operation of law, either
by the Agency’s voluntary act or otherwise, (iv) the invalidity or unenforceability of any of the terms or provisions
of the Transaction Documents, (v) any exculpatory provision contained in any of the Transaction Documents limiting the Agency’s
recourse to any other security or limiting the Agency’s rights to a deficiency judgment against the Company, (vi) any
investigation or inquiry conducted by or on the behalf of the Agency or any information which the Agency may have or obtain with
respect to the condition of the Environment at, or ecological condition of, the Facility, (vii) the sale, assignment or foreclosure
of any mortgage relating to all or any part of the Facility, but only with respect to a Release that has occurred prior to any
such event, (viii) the sale, assignment, subleasing, transfer or conveyance of all or part of the Land or the Facility or
the Company’s interests and rights in, to, and under the Lease Agreement or the termination of the Lease Agreement, but only
with respect to a Release that has occurred prior to any such event, (ix) the death or legal incapacity of the Company, (x) the
release or discharge, in whole or in part, of the Company in any bankruptcy, insolvency, reorganization, arrangement, readjustment,
composition, liquidation or similar proceeding, or (xi) any other circumstances which might otherwise constitute a legal or
equitable release or discharge, in whole or in part, of the Company under the Lease Agreement, or any other Transaction Document.


 






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(c)       In
the event of any claim against the Indemnified Parties by any employee or contractor of the Company or anyone directly or indirectly
employed by any of them or anyone for whose acts any of them may be liable, the obligations of the Company hereunder shall not
be limited in any way by any limitation on the amount or type of damages, compensation, disability benefits or other employee benefit
acts.


 


Section 8.3          Company to Maintain Its Existence. The Company covenants and agrees that at all times during the Lease Term, it will
(i) maintain its existence, (ii) continue to be an entity subject to service of process in the State and either organized
under the laws of the State, or organized under the laws of any other state of the United States and duly qualified to do business
as a foreign entity in the State, (iii) not liquidate, wind-up or dissolve or otherwise dispose of all or substantially all
of its property, business or assets remaining after the execution and delivery of this Lease Agreement, (iv) not consolidate
with or merge into another corporation or permit one or more corporations to consolidate with or merge into it, and (v) not change
more than 49% of the ownership and control of the Company or sell or transfer more than 49% of the equity interests in the Company,
except with consent of the Agency, which consent shall not be unreasonably withheld or delayed or conditioned.


 


Section 8.4          Qualification in State. The Company throughout the Lease Term shall continue to be duly authorized to do business
in the State.


 


Section 8.5          Agreement to File Annual Statements and Provide Information. The Company shall file with the NYSDTF an annual statement
of the value of all sales and use tax exemptions claimed in connection with the Facility in compliance with Sections 874(8)
of the GML as provided in Section 5.2(g) hereof. The Company shall submit a copy of such annual statement to the Agency at the
time of filing with NYSDTF. The Company shall also provide the Agency with the information necessary for the Agency to comply with
Section 874(9) of the GML. Annually, the Company shall provide the Agency with a certified statement and documentation (i) enumerating
the FTE jobs, by category, retained and/or created at the Facility as a result of the Agency’s financial assistance and (ii)
indicating the fringe benefits and salary averages or ranges for such categories of FTE jobs created and/or retained. The Company
further agrees to provide and certify or cause to be provided and certified such information concerning the Company, its finances,
its operations, its employment and its affairs necessary to enable the Agency to make any report required by law, governmental
regulation, including, without limitation, any reports required by the Act or the Public Authorities Accountability Act of 2005
and the Public Authorities Reform Act of 2009, each as amended from time to time, or any other reports required by the New York
State Authority Budget Office or the Office of the State Comptroller or any of the Agency Documents or Company Documents. Such
information shall be provided within thirty (30) days following written request from the Agency. The Company shall cause any and
all sublessees at the Facility to comply with the requirements of this Section 8.5 by requiring each such sublessee to enter into
a Tenant Agency Compliance Agreement.


 


Section 8.6          Books of Record and Account; Financial Statements. The Company at all times agrees to maintain proper accounts, records
and books in which full and correct entries shall be made, in accordance with generally accepted accounting principles, of all
transactions and events relating to the business and financial affairs of the Company.


 






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Section 8.7          Compliance with Orders, Ordinances, Etc.


 


(a)       The
Company, throughout the Lease Term, agrees that it will promptly comply, and cause any sublessee, tenant or occupant of the Facility
to comply, with all statutes, codes, laws, acts, ordinances, orders, judgments, decrees, injunctions, rules, regulations, permits,
licenses, authorizations, directions and requirements, ordinary or extraordinary, which now or at any time hereafter may be applicable
to the Facility or any part thereof, or to the Project Work, or to any use, manner of use or condition of the Facility or any part
thereof, of all federal, state, county, municipal and other governments, departments, commissions, boards, courts, authorities,
officials and officers having jurisdiction over the Facility or any part thereof, or of the Project Work, or of any use, manner
of use or condition of the Facility or any part thereof or of any companies or associations insuring the premises.


 


(b)       Notwithstanding
the provisions of subsection (a) above, the Company may in good faith contest the validity or the applicability of any requirement
of the nature referred to in such subsection (a) by appropriate legal proceedings conducted in good faith and with due diligence.
In such event, the Company may fail to comply with the requirement or requirements so contested during the period of such contest
and any appeal therefrom, unless the Agency shall notify the Company that by failure to comply with such requirement or requirements,
the Facility or any part thereof may be subject to loss, penalty or forfeiture, in which event the Company shall promptly take
such action with respect thereto or provide such security as shall be satisfactory to the Agency. If at any time the then existing
use or occupancy of the Facility shall, pursuant to any zoning or other law, ordinance or regulation, be permitted only so long
as such use or occupancy shall continue, the Company shall use its best efforts not to cause or permit such use or occupancy to
be discontinued without the prior written consent of the Agency.


 


Section 8.8          Discharge of Liens and Encumbrances.


 


(a)       The
Company, throughout the Lease Term, shall not permit or create or suffer to be permitted or created any Lien, except for Permitted
Encumbrances, upon the Facility or any part thereof by reason of any labor, services or materials rendered or supplied or claimed
to be rendered or supplied with respect to the Facility or any part thereof.


 


(b)       Notwithstanding
the provisions of subsection (a) above, the Company may in good faith contest any such Lien. In such event, the Company may
permit the items so contested to remain undischarged and unsatisfied during the period of such contest and any appeal therefrom,
unless the Agency shall notify the Company in writing that by nonpayment of any such item or items, the Facility or any part thereof
may be subject to loss or forfeiture. In the event of such notice the Company shall promptly secure payment of all such unpaid
items by filing a bond, in form and substance satisfactory to the Agency, thereby causing such Lien to be removed, or by taking
such other actions as may be satisfactory to the Agency to protect its interests. Mechanics’ Liens shall be discharged or
bonded within thirty (30) days of the filing or perfection thereof.


 






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Section 8.9          Depreciation Deductions and Investment Tax Credit. The parties agree that, as between them, the Company shall be
entitled to all depreciation deductions with respect to any depreciable property comprising a part of the Facility and to any investment
credit with respect to any part of the Facility.


 


Section 8.10        Employment Opportunities; Notice of Jobs. The Company covenants and agrees that, in consideration of the participation
of the Agency in the transactions contemplated herein, it will, except as otherwise provided by collective bargaining contracts
or agreements to which the Company is a party, cause any new employment opportunities created in connection with the Facility to
be listed with the New York State Department of Labor, Community Services Division and with the administrative entity of the service
delivery area created pursuant to the Job Training Partnership Act (PL 97-300), as superseded by the Workforce Innovation and Opportunity
Act (PL. 113-128), in which the Facility is located (collectively,
the “Referral Agencies”). The Company also agrees, and shall cause any and all Eligible Sublessees to agree,
that they will, where practicable, first consider for such new employment opportunities persons eligible to participate in federal
job training partnership programs who shall be referred by the Referral Agencies. As used in this Section 8.10 the term “Eligible
Sublessees” shall mean (1) all future sublessees located at the Facility; and (2) existing tenants of the Facility whose
lease is subject to renewal or amendment; provided however, such term shall not include existing tenants whose lease is subject
to automatic renewal or subject to renewal at the sole option of the tenant.


 


Section 8.11       
Employment at the Facility. The Company hereby agrees to create and/or maintain at all times at the Facility: sixty-two
(62) full time equivalent employees as of December 31, 2018, and ninety-two (92) full time equivalent employees as of December
31, 2019 and thereafter throughout the Lease Term, calculated on the basis of 35 hours per week who are employees of the Company
or any subsidiary or affiliates of the Company, or any tenants, consultants, contractors or subcontractors of the Company, or
any subsidiary or affiliates of the Company, whose place of employment or workplace is located at the Facility (including the
full time equivalent employees of all tenants at the Facility) (“FTE”).


 


ARTICLE
IX

RELEASE OF CERTAIN LAND; ASSIGNMENTS AND SUBLEASING


 


Section 9.1          Restriction on Sale of Facility; Release of Certain Land.


 


(a)       Except
as otherwise specifically provided in this Article IX and in Article X hereof, the Agency shall not sell, convey, transfer,
encumber or otherwise dispose of the Facility or any part thereof, or any of its rights under this Lease Agreement, without the
prior written consent of the Company.


 






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(b)       The
Agency and the Company from time to time may release from the provisions of this Lease Agreement and the leasehold estate created
hereby any part of, or interest in, the Land which is not necessary, desirable or useful for the Facility. In such event, the Agency,
at the Company’s sole cost and expense, shall execute and deliver any and all instruments necessary or appropriate so to
release such part of, or interest in, the Land. As a condition to such release, the Agency shall be provided with a copy of the
instrument transferring such title or interest in such Land, an instrument survey of the Land to be conveyed, together with a certificate
of an Authorized Representative of the Company stating that there is then no Event of Default under this Lease Agreement and that
such part of, or interest in, the Land is not necessary, desirable or useful for the Facility.


 


(c)       No
conveyance of any part of, or interest in, the Land effected under the provisions of this Section 9.l shall entitle the Company
to any abatement or diminution of the rents payable by it under this Lease Agreement or any abatement or diminution of the PILOT
Payments.


 


Section 9.2          Removal of Equipment.


 


(a)       The
Agency shall not be under any obligation to remove, repair or replace any inadequate, obsolete, worn out, unsuitable, undesirable
or unnecessary item of Equipment. In any instance where the Company determines that any item of Equipment has become inadequate,
obsolete, worn out, unsuitable, undesirable or unnecessary, the Company, may remove such items from the Facility and may sell,
trade-in, exchange or otherwise dispose of the same, as a whole or in part, provided that such removal will not materially impair
the operation of the Facility for the purpose for which it is intended or change the nature of the Facility so that it does not
constitute a “project” under the Act.


 


(b)       Upon
the request of the Company, the Agency shall execute and deliver to the Company all instruments necessary or appropriate to enable
the Company to sell or otherwise dispose of any such item of Equipment. The Company shall pay any costs (including attorneys’
fees) incurred in transferring title to any item of Equipment removed pursuant to this Section 9.2.


 


(c)       The
removal of any item of Equipment pursuant to this Section shall not entitle the Company to any abatement or diminution of the PILOT
Payments or any other amounts payable by it under this Lease Agreement.


 






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Section 9.3          Assignment and Subleasing.


 


(a)          This
Lease Agreement may not be assigned, in whole or in part, and the Facility may not be subleased, in whole or in part, without the
prior written consent of the Agency, in each instance, which consent shall not be unreasonably withheld or delayed, but shall be
subject to the dates of the Agency’s board meetings, and which consent may be fully and effectively given by the execution
and delivery of a Tenant Agency Compliance Agreement by an Authorized Representative of the Agency in substantially the form attached
hereto as Exhibit I; provided however, for the purposes of this Section 9.3(a), the Agency shall be deemed to have consented
in writing to the existing subleases between the Company and Carestream Health, Inc.; and between the Company and Dynamax Imaging,
LLC. Any assignment or sublease shall be on the following conditions, as of the time of such assignment or sublease:


  


(i)          no
assignment or sublease shall relieve the Company from primary liability for any of its obligations hereunder unless the Agency
consents thereto, which consent shall not be unreasonably withheld or delayed subject to the dates of the Agency’s board
meetings and which consent shall be conditioned upon the Agency being indemnified and held harmless to its reasonable satisfaction;


 


(ii)         the
assignee or sublessee (except in the case of a true sublessee in the ordinary course of business) shall assume the obligations
of the Company hereunder to the extent of the interest assigned or subleased;


 


(iii)        the
Company shall, within ten (10) days after the delivery thereof, furnish or cause to be furnished to the Agency a true and complete
copy of such assignment or sublease and the instrument of assumption;


 


(iv)        neither
the validity nor the enforceability of the Lease Agreement shall be adversely affected thereby;


 


(v)         the
Facility shall continue to constitute a “project” as such quoted term is defined in the Act, and, without limiting
the generality of the foregoing, no assignment or sublease shall cause the Facility to be used in violation of Section 862(2)(a)
of the Act and no assignment or sublease shall cause the Facility to be occupied by a sublessee in violation of Section 862(1)
of the Act; and


 


(vi)        any
future commercial sublessee will execute and deliver a Tenant Agency Compliance Agreement, satisfactory to the Agency in substantially
the form attached hereto as Exhibit I;


 


(b)          If
the Agency shall so request, as of the purported effective date of any assignment or sublease pursuant to subsection (a) of
this Section 9.3, the Company at its sole cost and expense shall furnish the Agency with opinions, in form and substance satisfactory
to the Agency, (i) of Transaction Counsel as to item (v) above, and (ii) of Independent Counsel as to items (i),
(ii), and (iv) above.


 


(c)          In
accordance with Section 862(1) of the Act, the Facility shall not be occupied by a sublessee whose tenancy would result in the
removal of a facility or plant of the proposed sublessee from one area of the State to another area of the State or in the abandonment
of one or more plants or facilities of such sublessee located within the State; provided, however, that neither restriction shall
apply if the Agency shall determine:


 


		(i)	that such occupation of the Facility is reasonably necessary to discourage the proposed sublessee
from removing such other plant or facility to a location outside the State, or



 



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		(ii)	that such occupation of the Facility is reasonably necessary to preserve the competitive position
of the proposed sublessee in its respective industry.



 


Section 9.4           Merger of Agency.


 


(a)          Nothing
contained in this Lease Agreement shall prevent the consolidation of the Agency with, or merger of the Agency into, or the transfer
of the Agency’s interest in the entire Facility to, any other public benefit corporation or political subdivision which has
the legal authority to own and lease the Facility and to continue the tax benefits contemplated by the Transaction Documents, provided
that upon any such consolidation, merger or transfer, the due and punctual performance and observance of all the agreements and
conditions of this Lease Agreement to be kept and performed by the Agency shall be expressly assumed in writing by the public benefit
corporation or political subdivision resulting from such consolidation or surviving such merger or to which the Facility shall
be transferred.


 


(b)          Within
thirty (30) days after the consummation of any such consolidation, merger or transfer of title, the Agency shall give notice thereof
in reasonable detail to the Company and shall, upon request, furnish to the Company, at the sole cost and expense of the Company,
a favorable opinion of Independent Counsel as to compliance with the provisions of Section 9.4(a) hereof. The Agency promptly
shall furnish such additional information with respect to any such transaction as the Company may reasonably request.


 


ARTICLE
X

EVENTS OF DEFAULT AND REMEDIES


 


Section 10.1        
Events of Default Defined.


 


		(a)	The following shall each be “Events of Default” under this Lease Agreement:



 


(i)           the
failure by the Company to pay or cause to be paid, on the date due, the amounts specified to be paid pursuant to Section 4.3(a)
and (b) hereof, and such failure continues for a period of ten (10) days after written notice, specifying such failure and requesting
that it be remedied, has been given to the Company by the Agency;


 


(ii)          the
failure by the Company to observe and perform any covenant contained in Sections 2.2(e), (f) or (i), 5.2, 6.3, 6.4, 6.5, 8.2,
8.4, 8.5, 8.11, 9.3, 10.4 and 10.6 and Article XIII hereof, and such failure continues for a period of ten (10) days after written
notice, specifying such failure and requesting that it be remedied, has been given to the Company by the Agency;


 


(iii)         the
failure by the Company to pay or cause to be paid PILOT Payments or the Recapture Benefits, in each case on the dates due, and
such failure continues for a period of five (5) days after written notice, specifying such failure and requesting that it be remedied,
has been given to the Company by the Agency;


 






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(iv)
      the occurrence and continuation of a Recapture Event;


 


(v)        any
representation or warranty of the Company herein, in any of the Company Documents or in the Project Application Information shall
prove to have been false or misleading in any material respect;


 


(vi)       the
failure by the Company to observe and perform any covenant, condition or agreement hereunder on its part to be observed or performed
(except obligations referred to in 10.1(a)(i), (ii), (iii) and (vii)) for a period of thirty (30) days after written notice, specifying
such failure and requesting that it be remedied, has been given to the Company by the Agency;


 


(vii)      the
dissolution or liquidation of the Company; or the failure by the Company to release, stay, discharge, lift or bond within thirty
(30) days any execution, garnishment, judgment or attachment of such consequence as may impair its ability to carry on its operations;
or the failure by the Company generally to pay its debts as they become due; or an assignment by the Company for the benefit of
creditors; or the commencement by the Company (as the debtor) of a case in bankruptcy or any proceeding under any other insolvency
law; or the commencement of a case in bankruptcy or any proceeding under any other insolvency law against the Company (as the debtor),
wherein a court having jurisdiction in the premises enters a decree or order for relief against the Company as the debtor, or such
case or proceeding is consented to by the Company or remains undismissed for forty (40) days, or the Company consents to or admits
the material allegations against it in any such case or proceeding; or a trustee, receiver or agent (however named) is appointed
or authorized to take charge of substantially all of the property of the Company for the purpose of enforcing a lien against such
Property or for the purpose of general administration of such Property for the benefit of creditors;


 


(viii)     an
Event of Default under the Mortgage, if any, shall have occurred and be continuing; or


 


(ix)       subject
to 10.1(c), a default by any tenant under its respective Tenant Agency Compliance Agreement shall have occurred and be continuing.


 


(b)          Notwithstanding
the provisions of Section 10.1(a), if by reason of force majeure any party hereto shall be unable in whole or in
part to carry out its obligations under Sections 3.4, 6.1 and 8.11 of this Lease Agreement, and if such party shall give
notice and full particulars of such force majeure in writing to the other party, within a reasonable time after the
occurrence of the event or cause relied upon, such obligations under this Lease Agreement of the party giving such notice
(and only such obligations), so far as they are affected by such force majeure, shall be suspended during continuation
of the inability, which shall include a reasonable time for the removal of the effect thereof. The term “force
majeure” as used herein shall include, without limitation, acts of God, strikes, lockouts or other industrial
disturbances, acts of public enemies, acts, priorities or orders of any kind of the government of the United States of
America or of the State or any of their departments, agencies, governmental subdivisions or officials or any civil or
military authority, insurrections, riots, epidemics, landslides, lightning, earthquakes, fire, hurricanes, storms, floods,
washouts, droughts, arrests, restraint of government and people, civil disturbances, explosions, breakage or accident to
machinery, transmission pipes or canals, shortages of labor or materials or delays of carriers, partial or entire failure of
utilities, shortage of energy or any other cause or event not reasonably within the control of the party claiming such
inability and not due to its fault. The party claiming such inability shall remove the cause for the same with all reasonable
promptness. It is agreed that the settlement of strikes, lockouts and other industrial disturbances shall be entirely within
the discretion of the party having difficulty, and the party having difficulty shall not be required to settle any strike,
lockout and other industrial disturbances by acceding to the demands of the opposing party or parties.


 






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(c)          No
Event of Default under this Lease Agreement shall be declared solely by reason of a default by any tenant under its respective
Tenant Agency Compliance Agreement provided that the Company has taken and continuously takes action to enforce any rights the
Company has under its lease with the tenant to cure such default or uses commercially reasonable efforts to terminate such lease
agreement. Notwithstanding anything else in this subsection, in any event, a default under any Tenant Agency Compliance Agreement
continuing beyond 180 days will be an Event of Default under this Lease Agreement.


 


Section 10.2       
Remedies on Default.


 


(a)          Whenever
any Event of Default shall have occurred and be continuing, the Agency may take, to the extent permitted by law, any one or more
of the following remedial steps:


 


(i)          declare,
by written notice to the Company, to be immediately due and payable, whereupon the same shall become immediately due and payable:
(A) all unpaid installments of rent payable pursuant to Section 4.3(a) and (b) hereof, (B) all unpaid and past due PILOT
Payments, (C) all due and owing Recapture Benefits, and (D) all other payments due under this Lease Agreement; provided, however,
that if an Event of Default specified in Section 10.1(a)(vii) hereof shall have occurred and be continuing, such installments
of rent and other payments due under this Lease Agreement shall become immediately due and payable without notice to the Company
or the taking of any other action by the Agency;


 


(ii)         terminate
this Lease Agreement and the Company Lease, reconvey the Equipment to the Company and terminate the Sales Tax Exemption authorization.
The Agency shall have the right to execute appropriate lease termination documents with respect to the Facility and to place the
same on record in the Ontario County Clerk’s office, at the sole cost and expense of the Company and in such event the Company
waives delivery and acceptance of such lease termination documents and the Company hereby appoints the Agency its true and lawful
agent and attorney-in-fact (which appointment shall be deemed to be an agency coupled with an interest), with full power of substitution
to file on its behalf all affidavits, questionnaires and other documentation necessary to accomplish the recording of such lease
termination documents; or


 






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(iii)        take
any other action at law or in equity which may appear necessary or desirable to collect the payments then due or thereafter to
become due hereunder, and to enforce the obligations, agreements and covenants of the Company under this Lease Agreement.


 


(b)          No
action taken pursuant to this Section 10.2 (including termination of the Lease Agreement) shall relieve the Company from its
obligation to make all payments required by Section 4.3 hereof or due and owing PILOT Payments or Recapture Benefits.


 


Section 10.3       
Remedies Cumulative. No remedy herein conferred upon or reserved to the Agency is intended to be exclusive of any
other available remedy, but each and every such remedy shall be cumulative and in addition to every other remedy given under this
Lease Agreement or now or hereafter existing at law or in equity. No delay or omission to exercise any right or power accruing
upon any default shall impair any such right and power or shall be construed to be a waiver thereof, but any such right or power
may be exercised from time to time and as often as may be deemed expedient. In order to entitle the Agency to exercise any remedy
reserved to it in this Article X, it shall not be necessary to give any notice, other than such notice as may be herein expressly
required in this Lease Agreement.


 


Section 10.4        Agreement to Pay Attorneys’ Fees and Expenses. In the event the Company should default under any of the provisions
of this Lease Agreement and the Agency should employ attorneys or incur other expenses for the collection of amounts payable hereunder
or the enforcement of performance or observance of any obligations or agreements on the part of the Company herein contained, the
Company shall, on demand therefor, pay to the Agency the reasonable fees of such attorneys and such other expenses so incurred.


 


Section 10.5       
No Additional Waiver Implied by One Waiver. In the event any agreement contained herein should be breached by any
party and thereafter waived by any other party, such waiver shall be limited to the particular breach so waived and shall not be
deemed to waive any other breach hereunder.


 


Section 10.6       
Certificate of No Default. The Company shall deliver to the Agency each year no later than January 15th, a certificate
signed by an Authorized Representative of the Company stating that the Company is not in default under this Lease Agreement and
that no Event of Default exists under this Lease Agreement or any other Company Document. Such certificate shall also contain all
information required under Section 8.5 hereof.


 






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ARTICLE
XI

EARLY TERMINATION OF LEASE AGREEMENT

OPTION IN FAVOR OF COMPANY


 


Section 11.1       Early Termination of Lease Agreement. The Company shall have the option to terminate this Lease Agreement at any
time upon filing with the Agency a certificate signed by an Authorized Representative of the Company stating the Company’s
intention to do so pursuant to this Section and stating the date upon which such payments required by Section 11.2 hereof
shall be made (which date shall not be less than forty five (45) nor more than 90 days from the date such certificate is filed)
and upon compliance with the requirements set forth in Section 11.2 hereof.


 


Section 11.2       Conditions to Termination of Lease Agreement. In the event of the termination or expiration of this Lease Agreement
in accordance with the provisions of Sections 4.2, 10.2 or 11.1 hereof, the Company shall make or cause to be made the following
payments:


 


(a)           To
the Agency or the Taxing Authorities, as appropriate pursuant to Section 5.1 hereof: all PILOT Payments due and payable hereunder
as of the date of the termination or expiration of this Lease Agreement;


 


(b)           To
the Agency: the purchase price with respect to the Equipment of one dollar ($1.00);


 


(c)           To
the Agency: all amounts due and payable under Section 5.4 hereof;


 


(d)           To
the Agency: an amount certified by the Agency to be sufficient to pay all unpaid fees and expenses of the Agency incurred under
the Agency Documents; and


 


(e)           To
the appropriate Person: an amount sufficient to pay all other fees, expenses or charges, if any, due and payable or to become due
and payable under the Company Documents.


 


Section 11.3       
Conveyance on Termination. At the closing of any expiration or termination of the Lease Agreement, the Agency shall,
upon receipt of the amounts payable pursuant to Section 11.2 hereof, deliver to the Company all necessary documents (i) to
terminate this Lease Agreement and the Company Lease and to convey the Equipment to the Company, subject in each case only to the
following: (A) any Liens to which leasehold estate or title to such Property was subject when conveyed to the Agency, (B) any
Liens created at the request of the Company, to the creation of which the Company consented or in the creation of which the Company
acquiesced, (C) any Permitted Encumbrances, and (D) any Liens resulting from the failure of the Company to perform or
observe any of the agreements on its part contained in this Lease Agreement or arising out of an Event of Default hereunder; and
(ii) to release and convey to the Company all of the Agency’s rights and interest in and to any rights of action or
any Net Proceeds of insurance or Condemnation awards with respect to the Facility (but not including any Unassigned Rights). At
the closing of any expiration or termination of the Lease Agreement, and unless otherwise waived by the Agency, as a condition
to such termination or expiration, the Company shall request each Lender to release the Agency from any Mortgage and any other
Loan Documents to which it is a party in writing and cause such releases to be recorded as applicable.


 






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ARTICLE
XII

LENDER PROVISIONS






 


Section 12.1       Subordination of Lease Agreement. This Lease Agreement and any and all modifications, amendments, renewals and extensions
thereof is subject and subordinate to any Mortgage which may be granted by the Agency and the Company on the Facility or any portion
thereof and to any and all modifications, amendments, consolidations, extensions, renewals, replacements and increases thereof.


 


Section 12.2       Mortgage and Pledge of Agency’s Interests to Lender. The Agency shall at the request of, and at the sole cost
and expense of, the Company (i) mortgage its interest in the Facility, and (ii) pledge and assign its rights to and interest
in this Lease Agreement (other than Unassigned Rights) to the Lender as security for the payment of the principal of and interest
on the Loan, in each case in accordance with the provisions attached hereto as Exhibit D. The Company hereby acknowledges
and consents to such mortgage, pledge and assignment by the Agency. Notwithstanding the foregoing, all indemnities herein contained
shall, subsequent to such mortgage, pledge and assignment, continue to run to the Agency for its benefit.


 


Section 12.3       
Pledge of Company’s Interest to Lender. The Company shall have the right to pledge and assign its rights to
and interest in this Lease Agreement and the Plans and Specifications to any Lender as security for the payment of the principal
of and interest on the Loan. The Agency hereby acknowledges and consents to any such pledge and assignment by the Company.


 


Section 12.4       
Making of Loans; Disbursement of Loan Proceeds. The Agency acknowledges that the Company may request one or more
Lenders to make one or more loans to finance and refinance the costs of the acquisition of the Facility and/or the Project Work
or to reimburse the Company for the cost of acquiring the Facility and/or the Project Work (the “Loan”). Proceeds
of such Loan shall be disbursed by such Lender in accordance with the provisions of the Mortgage or other related documentation
applicable to such Loan.


 


Provided that the Agency
shall have received the notice of the name and address of a Lender, the Agency agrees that simultaneously with its giving of any
notice under this Lease Agreement (each a “Notice”) it will send a copy of such Notice to each Lender. Each
Notice shall be sent to each Lender in the manner provided herein at the address provided to the Agency by each Lender for such
purpose. Each such Lender may change such address from time to time by written notice to the Agency in accordance herewith. The
Agency shall reasonably cooperate with the Company in connection with the granting or modification by the Company of any Mortgage.
Such cooperation shall include, without limitation, the execution and delivery of such documents and instruments in connection
with a Mortgage as the Company or the Lender may reasonably request (the “Loan Documents”), provided that such
documents and instruments shall contain the language set forth in Exhibit D attached hereto and made a part hereof. The
Company shall perform or cause to be performed for and on behalf of the Agency, and at the Company’s sole cost and expense,
each and every obligation of the Agency under and pursuant to such instruments.


 






     - 41 -


     


    

 


Section 12.5       
References to Lender, Loan or Mortgage. All references herein to Lender, Loan or Mortgage or other similar words,
whether in the singular or the plural, may be in anticipation of future Loans to be made by future Lenders. Such references shall
only be effective if such Loans have been made and are still outstanding. If such Loans are never made or have been repaid, such
references shall not be of any force or effect.


 


ARTICLE
XIII

ENVIRONMENTAL MATTERS


 


Section 13.1       Environmental Representations of the Company. Except as otherwise shown on Exhibit H attached hereto,
the Company hereby represents and warrants to the Agency that:


 


(a)           Neither
the Facility nor, to the best of Company’s knowledge, any property adjacent to or within the immediate vicinity of the Facility
is being or has been used in violation of any applicable Environmental Law for the storage, treatment, generation, transportation,
processing, handling, production or disposal of any Hazardous Substance or as a landfill or other waste management or disposal
site or for military, manufacturing or industrial purposes or for the storage of petroleum or petroleum based products.


 


(b)           Underground
storage tanks are not and to the best of the Company’s knowledge have not been located on the Facility.


 


(c)           The
soil, subsoil, bedrock, surface water and groundwater of the Facility are free of Hazardous Substances, in violation of Environmental
Law, other than any such substances that occur naturally.


 


(d)           There
has been no Release or threat of a Release of any Hazardous Substance in violation of any applicable law on, at or from the Facility
or to the best of the Company’s knowledge any property adjacent to or within the immediate vicinity of the Facility which
through soil, subsoil, bedrock, surface water or groundwater migration could come to be located on or at the Facility, and the
Company has not received any form of notice or inquiry from any federal, state or local governmental agency or authority, any operator,
tenant, subtenant, licensee or occupant of the Facility or any property adjacent to or within the immediate vicinity of the Facility
or any other person with regard to a Release or the threat of a Release of any Hazardous Substance on, at or from the Facility
or any property adjacent to or within the immediate vicinity of the Facility in violation of any applicable law.


 


(e)           All
Environmental Permits necessary for the Project Work and the ownership, use or operation of the Facility have been either (i) obtained
and are in full force and effect, or (ii) applied for.


 






     - 42 -


     


    

 


(f)           No
event has occurred with respect to the Facility which, with the passage of time or the giving of notice, or both, would constitute
a violation of or non-compliance with any applicable Environmental Law or Environmental Permit.


 


(g)          There
are no agreements, consent orders, decrees, judgments, license or permit conditions or other orders or directives of any federal,
state or local court, governmental agency or authority relating to the past, present or future construction, renovation, equipping,
ownership, use, operation, sale, transfer or conveyance of the Facility which require any change in the present condition of the
Facility or any work, repairs, construction, containment, clean up, investigations, studies, removal or remedial action or capital
expenditures in order for the Facility to be in compliance with any applicable Environmental Law or Environmental Permit.


 


(h)          There
are no actions, suits, claims or proceedings, pending or threatened, which could cause the incurrence of expenses or costs of any
name or description or which seek money damages, injunctive relief, remedial action or remedy that arise out of, relate to or result
from (i)  conditions of the Environment at, on or in the vicinity of the Facility, (ii) a violation or alleged violation of
any applicable Environmental Law or non-compliance or alleged non-compliance with any Environmental Permit with respect to the
Facility, (iii) the presence of any Hazardous Substance or a Release or the threat of a Release of any Hazardous Substance
on, at or from the Facility or any property adjacent to or within the immediate vicinity of the Facility or (iv) human exposure
to any Hazardous Substance, noises, vibrations or nuisances of whatever kind to the extent the same arise from the condition of
the Facility, the Project Work or the ownership, use, operation, sale, transfer or conveyance of the Facility.


 


Section 13.2       
Environmental Covenants of the Company. The Company hereby covenants and agrees with the Agency as follows:


 


(a)          The
Company shall perform the Project Work and use, operate and manage the Facility in accordance with all applicable Environmental
Laws and Environmental Permits, and shall cause all operators, tenants, subtenants, licensees and occupants of the Facility to
perform the Project Work and to use, operate and manage the Facility in accordance with any applicable Environmental Laws and Environmental
Permits, and shall not cause, allow or permit the Facility or any part thereof to be operated or used for the storage, treatment,
generation, transportation, processing, handling, production, management or Disposal of any Hazardous Substances other than in
accordance with all applicable Environmental Laws and Environmental Permits.


 


(b)          The
Company shall obtain and comply with, and shall cause all contractors, subcontractors, operators, tenants, subtenants, licensees
and occupants of the Facility to obtain and comply with, all Environmental Permits, if any.


 


(c)          The
Company shall not cause or permit any change to be made in the present or intended Project Work or use or operation of the Facility
which would (i) involve the storage, treatment, generation, transportation, processing, handling, management, production or
disposal of any Hazardous Substance other than in accordance with any applicable Environmental Law, or the Project Work or use
or operation of the Facility as a landfill or waste management or disposal site or for manufacturing or industrial purposes or
for the storage of petroleum or petroleum based products other than in accordance with any applicable Environmental Law, (ii) violate
any applicable Environmental Law, (iii) constitute a violation or non-compliance with any Environmental Permit or (iv) increase
the risk of a Release of any Hazardous Substance.


 






     - 43 -


     


    

 


(d)          The
Company shall promptly provide the Agency with a copy of all notifications which the Company gives or receives with respect to
conditions of the Environment at or in the vicinity of the Facility, any past or present Release or the threat of a Release of
any Hazardous Substance on, at or from the Facility or any property adjacent to or within the immediate vicinity of the Facility.
If the Company receives or becomes aware of any such notification which is not in writing or otherwise capable of being copied,
the Company shall promptly advise the Agency of such verbal, telephonic or electronic notification and confirm such notice in writing.
Furthermore, upon the Company’s discovery thereof, the Company shall promptly advise the Agency in writing of: (i) the presence
of any Hazardous Substance on, under or about the Facility of which the Agency has not previously been advised in writing; (ii)
any remedial action taken by, or on behalf of, the Company in response to any Hazardous Substance on, under or about the Facility
or to any environmental proceedings of which the Company has not previously been advised in writing; and (iii) the occurrence or
condition on any real property adjoining or in the vicinity of the Facility that could reasonably be expected to cause the Facility
or any part thereof to be subject to any restrictions on the ownership, occupancy, transferability or use of the Facility under
any Environmental Law. The Company shall also provide the Agency with copies of all reports, analyses, notices, licenses, approvals,
orders, correspondences or other written materials in its possession or control relating to the condition of the Environment at
the Facility or real property or bodies of water adjoining or in the vicinity of the Facility or environmental proceedings promptly
upon receipt, completion or delivery of such materials.


 


(e)          The
Company shall undertake and complete all investigations, studies, sampling and testing and all removal or remedial actions necessary
to contain, remove and clean up all Hazardous Substances that are or may become present at the Facility and are required to be
removed and/or remediated in accordance with all applicable Environmental Laws and all Environmental Permits. All remedial work
shall be conducted (i) in a diligent and timely fashion by licensed contractors acting under the supervision of a consulting environmental
engineer, (ii) pursuant to a detailed written plan for the remedial work approved by any public or private agencies or persons
with a legal or contractual right to such approval, (iii) with such insurance coverage pertaining to liabilities arising out of
the remedial work as is then customarily maintained with respect to such activities, and (iv) only following receipt of any required
permits, licenses or approvals. In addition, the Company shall submit, or cause to be submitted, to the Agency, promptly upon receipt
or preparation, copies of any and all reports, studies, analyses, correspondence, governmental comments or approvals, proposed
removal or other remedial work contracts and similar information prepared or received by or on behalf of the Company in connection
with any remedial work, or Hazardous Substances relating to the Facility. All costs and expenses of such remedial work shall be
paid by or on behalf of the Company, including, without limitation, the charges of the remedial work contractors and the consulting
environmental engineer, any taxes or penalties assessed in connection with the remedial work and the Agency’s out-of-pocket
costs incurred in connection with monitoring or review of such remedial work. The Agency shall have the right but not the obligation
to join and participate in, as a party if it so elects, any legal proceedings or actions initiated in connection with any environmental
proceedings.


 






     - 44 -


     


    

 


(f)           If
at any time the Agency obtains any notice or information that the Company or the Facility, or the use or operation thereof or the
Project Work may be in violation of an Environmental Law or in non-compliance with any Environmental Permit or standard, the Agency
may require that a full or supplemental environmental inspection and audit report with respect to the Facility of a scope and level
of detail reasonably satisfactory to the Agency be prepared by a professional environmental engineer or other qualified environmental
scientist acceptable to the Agency, at the Company’s sole cost and expense. Said audit may, but is not required to or limited
to, include a physical inspection of the Facility, a records search, a visual inspection of any property adjacent to or within
the immediate vicinity of the Facility, personnel interviews, review of all Environmental Permits and the conducting of scientific
testing. If necessary to determine whether a violation of an Environmental Law exists, such inspection shall also include subsurface
testing for the presence of Hazardous Substances in the soil, subsoil, bedrock, surface water and/or groundwater. If said audit
report indicates the presence of any Hazardous Substance or a Release or Disposal or the threat of a Release or Disposal of any
Hazardous Substance on, at or from the Facility in violation of any applicable law, the Company shall promptly undertake and diligently
pursue to completion all necessary, appropriate investigative, containment, removal, clean-up and other remedial actions required
by any Environmental Law, in accordance with Section 13.2(e) above. The Company hereby consents to the Agency notifying any party
under such circumstances of the availability of any or all of the environmental reports and the information contained therein.
The Company further agrees that the Agency may disclose such environmental reports to any governmental agency or authority if they
reasonably believe that they are required to disclose any matter contained therein to such agency or authority; provided that the
Agency shall give the Company at least forty-eight (48) hours prior written notice before so doing. The Company acknowledges that
the Agency cannot control or otherwise assure the truthfulness or accuracy of the environmental reports, and that the release of
the environmental reports, or any information contained therein, to prospective bidders at any foreclosure sale of the Facility
may have a material and adverse effect upon the amount which a party may bid at such sale. The Company agrees that the Agency shall
not have any liability whatsoever as a result of delivering any or all of the environmental reports or any information contained
therein to any third party if done in good faith, and the Company hereby releases and forever discharges the Agency from any and
all claims, damages, or causes of action arising out of, connected with or incidental to the delivery of environmental reports.


 


Section 13.3       
Survival Provision. Notwithstanding anything to the contrary contained herein, the representations, warranties, covenants
and indemnifications of the Company contained in this Article XIII shall survive any termination, conveyance, assignment, subleasing
or defeasance of any right, title or interest of the Company in and to the Facility or in, to or under the Lease Agreement.


 






     - 45 -


     


    

 


ARTICLE
XIV

MISCELLANEOUS


 


Section 14.1       
Notices. All notices, certificates and other communications hereunder shall be in writing and shall be either delivered
personally or sent by certified mail, return receipt requested, or delivered by any national overnight express delivery service
(in each case, postage or delivery charges paid by the party giving such communication) addressed as follows or to such other address
as any party may specify in writing to the other:


 


To the Agency:


 


Ontario County Industrial Development
Agency


20 Ontario Street


Canandaigua, New York 14424


Attention: Michael
J. Manikowski, Executive Director


 


With a copy to:


 


Underberg & Kessler LLP


300 Bausch & Lomb Place


Rochester, New York 14604


Attention: James Coniglio,
Esq.


 


To the Company:


 


Akoustis, Inc.


9805-A Northcross Center Court


Huntersville, North Carolina 28078


Attention: John T.
Kurtzweil, CFO


 


With a copy to:


 


Akoustis Manufacturing New York,
Inc.


9805-A Northcross Center Court


Huntersville, North Carolina 28078


Attention: Drew Wright,
General Counsel


 


and


 


McConville, Considine, Cooman & Morin, P.C.

25 East Main Street

Rochester, New York 14614

Attention: William E. Brueckner


 


Notice by mail shall
be effective when delivered but if not yet delivered shall be deemed effective at 12:00 p.m. on the third Business Day after mailing
with respect to certified mail and one Business Day after mailing with respect to overnight mail.


 






     - 46 -


     


    

 


Copies of all notices
given either to the Agency or to the Company shall also be sent to any Lender, if such Lender shall have delivered written instructions
to the Agency and the Company with the address of such Lender pursuant to Section 12.4 hereof.


 


Section 14.2      
Binding Effect. This Lease Agreement shall inure to the benefit of and shall be binding upon the parties and their
respective successors and assigns.


 


Section 14.3        Severability. In the event any provision of this Lease Agreement shall be held illegal, invalid or unenforceable
by any court of competent jurisdiction, such holding shall not invalidate or render unenforceable any other provision hereof.


 


Section 14.4        Amendments, Changes and Modifications. This Lease Agreement may not be amended, changed, modified, altered or (except
pursuant to Section 10.2 hereof) terminated except in a writing executed by the parties hereto.


 


Section 14.5       
Execution of Counterparts. This Lease Agreement may be executed in several counterparts, each of which shall be an
original and all of which shall constitute but one and the same instrument.


 


Section 14.6        Applicable Law. This Lease Agreement shall be governed exclusively by the applicable laws of the State without regard
or reference to its conflict of laws principles.


 


Section 14.7       
List of Additional Equipment; Further Assurances. Upon the Completion Date with respect to the Facility and the installation
of all of the Equipment therein, the Company shall prepare and deliver to the Agency, a schedule listing all of the Equipment not
previously described in this Lease Agreement. If requested by the Agency, the Company shall thereafter furnish to the Agency, within
sixty (60) days after the end of each calendar year, a schedule listing all of the Equipment not theretofore previously described
herein or in the aforesaid schedule.


 


Section 14.8      
Survival of Obligations. This Lease Agreement shall survive the performance of the obligations of the Company to
make the payments required by Section 4.3, and all indemnities shall survive the foregoing and any termination or expiration
of this Lease Agreement.


 


Section 14.9       
Table of Contents and Section Headings Not Controlling. The Table of Contents and the headings of the several Sections
in this Lease Agreement have been prepared for convenience of reference only and shall not control or affect the meaning of or
be taken as an interpretation of any provision of this Lease Agreement.


 


Section 14.10     
Waiver of Trial by Jury. The parties do hereby expressly waive all rights to trial by jury on any cause of action
directly or indirectly involving the terms, covenants or conditions of this Lease Agreement or the Facility or any matters whatsoever
arising out of or in any way connected with this Lease Agreement.


 


(Remainder of Page Intentionally Left
Blank - Signature Pages Follow)


 






     - 47 -


     


    

 



 


IN WITNESS WHEREOF,
the Agency and the Company have caused this Lease Agreement to be executed in their respective names by their duly authorized
representatives, all as of the day and year first above written.





	 	 	 
	 	ONTARIO COUNTY INDUSTRIAL DEVELOPMENT
    AGENCY
	 	 	 
	 	By:	/s/ Michael
    J. Manikowski
	 	Name: Michael J. Manikowski
	 	Title:   Executive Director



 





	STATE OF NEW YORK	)
	 	:  SS.:
	COUNTY OF MONROE	)


 


On the 26th
day of February in the year 2018, before me, the undersigned, personally appeared Michael J. Manikowski, personally known
to me or proved to me on the basis of satisfactory evidence to be the individual whose name is subscribed to the within instrument,
and acknowledged to me that he executed the same in his capacity, and that by his signature on the instrument, the individual,
or the person or entity on behalf of which the individual acted, executed the instrument.





	 	 
	 	/s/
    T. Barry Carrigan
	 	Notary Public



  




    Signature Page to Lease Agreement
Page 1 of 2


     


    


 





	 	 	 
	 	AKOUSTIS,
INC.
	 	 	 
	 	By:	/s/ Jeffrey B. Shealy
	 	Name: Jeffrey B. Shealy
	 	Title:   President and Chief Executive Officer


 


	STATE OF NORTH CAROLINA	)
	 	:  SS.:
	COUNTY OF MECKLENBURG	)


 


On the 23 day of
February in the year 2018, before me, the undersigned, personally appeared Jeffrey B. Shealy, personally known to me or proved
to me on the basis of satisfactory evidence to be the individual whose name is subscribed to the within instrument, and acknowledged
to me that he executed the same in his capacity, and that by his signature on the instrument, the individual, or the person or
entity on behalf of which the individual acted, executed the instrument.





	 	 
	 	/s/
    Hannah Stalvey
	 	Notary Public


  




    Signature Page to Lease Agreement
Page 2 of 2


     


    


 


EXHIBIT A


 


Legal Description of Real Property


 




     


     


    


 


EXHIBIT B


 


Equipment


 


All Eligible Items
acquired, constructed, renovated or installed and/or to be acquired, constructed, renovated or installed by or on behalf of the
Company, in connection with the completion of the Ontario County Industrial Development Agency’s Akoustis, Inc. 2018 Facility
located at 5450 Campus Drive, Canandaigua, New York, and leased to the Company pursuant to the Lease Agreement.


 




     


     


    


 


EXHIBIT C


 


PILOT Schedule


 


Formula for In-Lieu-of-Taxes
Payment: Ontario County (including any existing incorporated village and any village which may be incorporated after the date hereof,
within which the Facility is wholly or partially located), Town of Canandaigua, Canandaigua City School District and Appropriate
Special Districts


 


Definitions


 


		X =	allocated purchase price of the Land and existing improvements of $2,573,100.00.



 


		Y =	Full Assessment of Land and Improvements.



 


		Normal Tax Due =	Those payments for taxes and assessments, other than
special ad valorem levies, special assessments and service charges against real property located in the Town of Canandaigua which
are or may be imposed for special improvements or special district improvements, that the Company would pay without exemption.



 


		Tax Year =	payments due beginning in the 2019 County Tax Year and
the 2018/2019 School Tax Year.



 


Payment


 


	Tax Year	Formula



 


		1	0% Normal Tax Due on X






		2	0% Normal Tax Due on X






		3	0% Normal Tax Due on X






		4	0% Normal Tax Due on X






		5	0% Normal Tax Due on X






		6	20% Normal Tax Due on X






		7	40% Normal Tax Due on X






		8	60% Normal Tax Due on X






		9	80% Normal Tax Due on X






		10	100% Normal Tax Due on X






		11 and	100% Normal Tax Due on Y






thereafter


 




     


     


    


 


EXHIBIT D


 


Mortgage Requirements


 


Any Mortgage or related
document which shall be entered into by the Agency and the Company shall contain the following required provisions:


 


Non-Recourse and Hold Harmless Provisions to be included
in the Lender’s Mortgage


 


Section ___. No
Recourse Against Agency. The general credit of the Agency is not obligated or available for the payment of this Mortgage. The
Mortgagee will not look to the Agency or any principal, member, director, officer or employee of the Agency with respect to the
indebtedness evidenced by this Mortgage or any covenant, stipulation, promise, agreement or obligation contained herein. In enforcing
its rights and remedies under this Mortgage, the Mortgagee will look solely to the mortgaged premises and/or the Company for the
payment of the indebtedness secured by this Mortgage and for the performance of the provisions hereof. The Mortgagee will not seek
a deficiency or other money judgment against the Agency or any principal, member, director, officer or employee of the Agency and
will not institute any separate action against the Agency by reason of any default that may occur in the performance of any of
the terms and conditions of this Mortgage or the Loan Documentation. This agreement on the part of the Mortgagee shall not be construed
in any way so as to effect or impair the lien of this Mortgage or the Mortgagee’s right to foreclose hereunder as provided
by law or construed in any way so as to limit or restrict any of the rights or remedies of the Mortgagee in any foreclosure proceedings
or other enforcement of payment of the indebtedness secured hereby out of and from the security given therefor. All covenants,
stipulations, promises, agreements and obligations are the Agency’s and not of any member, director, officer, employee or
agent (except the Company) of the Agency in his or her individual capacity, and no recourse shall be had for the payment of the
principal of any debt or interest thereon or for any claim based thereon or hereunder against any member, director, officer, employee
or agent (except the Company) of the Agency or any natural person executing this Mortgage on behalf of the Agency. No covenant
contained herein shall be deemed to constitute a debt of the State of New York or Ontario County and neither the State of New York
nor Ontario County shall be liable on any covenant contained herein, nor shall any obligations hereunder be payable out of any
funds of the Agency.


 


Section ___. Hold
Harmless Provisions. The Company agrees that the Agency, its directors, members, officers, agents (except the Company) and
employees shall not be liable for and agrees to defend, indemnify, release and hold the Agency, its director, members, officers,
agents (except the Company) and employees harmless from and against any and all (i) liability for loss or damage to property
or injury to or death of any and all persons that may be occasioned by, directly or indirectly, any cause whatsoever pertaining
to the Facility or arising by reason of or in connection with the use thereof or under this Mortgage, or (ii) liability arising
from or expense incurred by the Project Work or the Agency’s acquiring, owning and leasing of the Facility, including without
limiting the generality of the foregoing, all claims arising from the breach by the Company of any of its covenants contained herein
and all causes of action and reasonable attorneys’ fees (whether by reason of third party claims or by reason of the enforcement
of any provision of the Mortgage (including, without limitation, this Section)) and any other expenses incurred in defending any
claims, suits or actions which may arise as a result of the foregoing, provided that any such losses, damages, liabilities or expenses
of the Agency are not incurred or do not result from the gross negligence or intentional or willful wrongdoing of the Agency or
any of its directors, members, officers, agents (except the Company) or employees. The foregoing indemnities shall apply notwithstanding
the fault or negligence on the part of the Agency, or any of its members, directors, officers, agents, or employees and irrespective
of the breach of a statutory obligation or the application of any rule of comparative or apportioned liability. The foregoing indemnities
are limited only to the extent of any prohibitions imposed by law, and upon the application of such prohibition by the final judgment
or decision of a competent court of law, the remaining provisions of these indemnities shall remain in full force and effect.


 






    Exhibit D-1


     


    

 


(b)           Notwithstanding
any other provisions of this Mortgage, the obligations of the Company pursuant to this Section ___ shall remain in full force
and effect after the termination of this Mortgage until the expiration of the period stated in the applicable statute of limitations
during which a claim, cause of action or prosecution relating to the matters herein described may be brought and payment in full
or the satisfaction of such claim, cause of action or prosecution relating to the matters herein described and the payment of all
reasonable expenses and charges incurred by the Agency, or its respective members, directors, officers, agents (except the Company)
and employees, relating to the enforcement of the provisions herein specified.


 


(c)            In
the event of any claim against the Agency or its members, directors, officers, agents (except the Company) or employees by any
employee or contractor of the Company or anyone directly or indirectly employed by any of them or anyone for whose acts any of
them may be liable, the obligations of the Company hereunder shall not be limited in any way by any limitation on the amount or
type of damages, compensation, disability benefits or other employee benefit acts.


 


Section ___. Recordation
of Mortgage. The Agency covenants that it will record or cause this Mortgage to be duly recorded in all offices where recordation
thereof is necessary.


 


Section___. Termination
of Lease Agreement. Upon the termination of the Lease Agreement for any reason whatsoever, and at the sole cost and expense
of the Company, the Mortgagee shall prepare, execute and deliver to the Agency and the Company, and the Agency and the Company
shall execute, any documents necessary to amend the Mortgage to remove the Agency as a party thereto.


 




    Exhibit D-2


     


    


 


EXHIBIT E


 


FORM OF SALES TAX AGENT AUTHORIZATION LETTER


 


SALES TAX AGENT AUTHORIZATION LETTER


 


EXPIRATION DATE: ___________ 1, 201_


 


ELIGIBLE LOCATION:


 


5450 Campus Drive, Canandaigua, New York
14424


 


___________ __, 201_


 


TO WHOM IT MAY CONCERN


 


		 Re:	Ontario County Industrial Development 

                                         Agency (Akoustis, Inc. 2018 Facility)



 


Ladies and Gentlemen:


 


The Ontario County Industrial Development
Agency (the “Agency”), by this notice, hereby advises you as follows:


 


1.             Pursuant
to a certain Lease and Project Agreement, dated as of February 1, 2018 (the “Lease Agreement”), between the
Agency and Akoustis, Inc., a business corporation duly organized and validly existing under the laws of the State of Delaware,
having its principal office at 9805-A Northcross Center Court, Huntersville, North Carolina 28078 (the “Company”),
the Agency has authorized the Company to act as its agent in connection with the Facility described therein located at the Eligible
Location described above. Certain capitalized terms used herein and not defined shall have the respective meanings given to such
terms in the Lease Agreement.


 


2.             Upon
the Company’s request, the Agency has appointed [insert name of Agent] (the “Agent”), pursuant
to this Sales Tax Agent Authorization Letter (the “Sales Tax Agent Authorization Letter”) to act as the Agency’s
agent for the purpose of effecting purchases exempt from sales or use tax in accordance with the terms, provisions of this Sales
Tax Agent Authorization Letter and the Lease Agreement. The Agent should review the definitions of Eligible Items and Ineligible
Items in Schedule A hereto with respect to the scope of Sales Tax Exemption provided under the Lease Agreement and hereunder.


 


3.             The
effectiveness of the appointment of the Agent as an agent of the Agency is expressly conditioned upon the execution by the Agency
of New York State Department of Taxation and Finance Form ST-60 “IDA Appointment of Project Operator or Agent” (“Form
ST-60”) to evidence that the Agency has appointed the Agent as its agent (the form of which is to be completed by Agent
and the Company). Pursuant to the exemptions from sales and use taxes available to the Agent under this Sales Tax Agent Authorization
Letter, the Agent shall avail itself of such exemptions when purchasing eligible materials and services in connection with the
Facility and shall not include such taxes in its contract price, bid or reimbursable costs, as the case may be.


 






    Exhibit E-1


     


    

 


4.             The
Agent acknowledges that the executed Form ST-60 shall not serve as a sales or use tax exemption certificate or document. No agent
or project operator may tender a copy of the executed Form ST-60 to any person required to collect sales tax as a basis to make
such purchases exempt from tax. No such person required to collect sales or use taxes may accept the executed Form ST-60 in lieu
of collecting any tax required to be collected. THE CIVIL AND CRIMINAL PENALTIES FOR MISUSE OF A COPY OF FORM ST-60 AS AN EXEMPTION
CERTIFICATE OR DOCUMENT OR FOR FAILURE TO PAY OR COLLECT TAX SHALL BE AS PROVIDED IN THE TAX LAW. IN ADDITION, THE USE BY AN AGENT,
THE COMPANY, OR OTHER PERSON OR ENTITY OF SUCH FORM ST-60 AS AN EXEMPTION CERTIFICATE OR DOCUMENT SHALL BE DEEMED TO BE, UNDER
ARTICLES TWENTY-EIGHT AND THIRTY-SEVEN OF THE TAX LAW, THE ISSUANCE OF A FALSE OR FRAUDULENT EXEMPTION CERTIFICATE OR DOCUMENT
WITH THE INTENT TO EVADE TAX.


 


5.             As
agent for the Agency, the Agent agrees that it will present to each seller or vendor a completed and signed NYSDTF Form ST-123
“IDA Agent or Project Operator Exempt Purchase Certificate” or such additional or substitute form as is adopted
by NYSDTF for use in completing purchases that are exempt from Sales and Use Taxes (“Form ST-123”) for each
contract, agreement, invoice, bill or purchase order entered into by the Agent, as agent for the Agency, for the construction,
repair and equipping of the Facility. Form ST-123 requires that each seller or vendor accepting Form ST-123 identify the Facility
on each bill and invoice and invoice for purchases and indicate on the bill or invoice that the Agency or Agent or Company, as
project operator of the Agency, was the purchaser. For the purposes of indicating who the purchaser is, each bill or invoice should
state, “I, [Company/Agent], certify that I am duly appointed agent of the Ontario County Industrial Development Agency and
that I am purchasing the tangible personal property or services for use in the Akoustis, Inc. 2018 Facility located at 5450 Campus
Drive, Canandaigua, Ontario County, New York, IDA Project Number [__].” The Agent shall complete Form ST-123 as follows:
(i) the “Project information” section of Form ST-123 should be completed using the name and address of the Facility
as indicated on the Form ST-60 used to appoint the Agent; (ii) the date that the Agent was appointed as an agent should be completed
using the date of the Agent’s Sales Tax Agent Authorization Letter; and (iii) the “Exempt purchases” section
of Form ST-123 should be completed by marking “X” in box “A” only.


 


6.             The
Agent agrees to comply with the terms and conditions of the Lease Agreement. The Agent must retain for at least six (6) years from
the date of expiration of its contract copies of (a) its contract with the Company to provide services in connection with the Facility,
(b) all contracts, agreements, invoices, bills or purchases entered into or made by such Agent using the Letter of Authorization
for Sales Tax Exemption, and (c) the executed Form ST-60 appointing the Agent as an agent of the Agency, and shall make such records
available to the Agency upon reasonable notice. This provision shall survive the expiration or termination of this Sales Tax Agent
Authorization Letter.


 






    Exhibit E-2


     


    

 


7.             In
order to assist the Company in complying with its obligation to file New York State Department of Taxation and Finance Form ST-340
“Annual Report of Sales and Use Tax Exemptions Claimed by Agent/Project Operator of Industrial Development Agency/Authority”
(“Form ST-340”), the Agent covenants and agrees that it shall file semi-annually with the Company and the Agency
(no later than January 15th and July 15th of each calendar year in which it has claimed sales and use tax exemptions in connection
with the Facility) a written statement of all sales and use tax exemptions claimed by such Agent for the preceding six-month period
(ending on June 30th or December 31st, as applicable) in connection with the Facility by completing and submitting to the Company
and the Agency the Sales Tax Registry attached hereto as Schedule B. If the Agent fails to comply with the
foregoing requirement, the Agent shall immediately cease to be the agent for the Agency in connection with the Facility (such agency
relationship being deemed to be immediately revoked) without any further action of the parties, the Agent shall be deemed to have
automatically lost its authority to make purchases as agent for the Agency, and shall desist immediately from all such activity.


 


8.             The
Agent agrees that if it fails to comply with the requirements for sales and use tax exemptions, as described in this Sales Tax
Agent Authorization Letter, it shall pay any and all applicable Company Sales Tax Savings and any interest and penalties thereon.
This provision shall survive the expiration or termination of this Sales Tax Agent Authorization Letter.


 


		9.	Special Provisions Relating to State Sales Tax Savings.



 


(a)       The
Agent covenants and agrees to comply, and to cause each of its contractors, subcontractors, persons or entities to comply, with
the requirements of General Municipal Law Sections 875(1) and (3) (the “Special Provisions”), as such provisions
may be amended from time to time. In the event of a conflict between the other provisions of this Sales Tax Agent Authorization
Letter or the Lease Agreement and the Special Provisions, the Special Provisions shall control.


 


(b)       The
Agent acknowledges and agrees that pursuant to General Municipal Law Section 875(3) the Agency shall have the right to recover,
recapture, receive, or otherwise obtain from the Agent State Sales Tax Savings taken or purported to be taken by the Agent or any
other person or entity acting on behalf of the Agent to which Agent or the Company is not entitled or which are in excess of the
Maximum Company Sales Tax Savings Amount or which are for property or services not authorized or taken in cases where the Company,
any Agent or any other person or entity acting on behalf of the Company or the Agent failed to comply with a material term or condition
to use property or services in the manner required by this Sales Tax Agent Authorization Letter or the Lease Agreement. The Company
shall, and shall require each Agent and any other person or entity acting on behalf of the Company, to cooperate with the Agency
in its efforts to recover, recapture, receive, or otherwise obtain such State Sales Tax Savings and shall promptly pay over any
such amounts to the Agency that it requests. The failure to pay over such amounts to the Agency shall be grounds for the Commissioner
of the New York State Department of Taxation and Finance (the “Commissioner”) to assess and determine State
Sales and Use Taxes due from the Company under Article Twenty-Eight of the New York State Tax Law, together with any relevant penalties
and interest due on such amounts.


 






    Exhibit E-3


     


    

 


10.           Subject
to the provisions of Section 9 hereof, in the event that the Agent shall utilize the Sales Tax Exemption in violation of the provisions
of the Lease Agreement or this Sales Tax Agent Authorization Letter, the Agent shall promptly deliver notice of same to the Company
and the Agency, and the Agent shall, upon demand by the Agency, pay to or at the direction of the Agency a return of sales or use
tax exemptions in an amount equal to all such unauthorized sales or use tax exemptions together with interest at the rate of twelve
percent (12%) per annum compounded daily from the date and with respect to the dollar amount for which each such unauthorized sales
or use tax exemption was availed of by the Agent.


 


11.           Upon
request by the Agency with reasonable notice to the Agent, the Agent shall make available at reasonable times to the Agency all
such books, records, contracts, agreements, invoices, bills or purchase orders of the Agent, and require all appropriate officers
and employees of the Agent to respond to reasonable inquiries by the Agency as shall be necessary (y) to indicate in reasonable
detail those costs for which the Agent shall have utilized the Sales Tax Exemption and the dates and amounts so utilized, and (z) to
permit the Agency to determine any amounts owed by the Agent under Section 10.


 


12.           By
execution of this Sales Tax Agent Authorization Letter, the Agent agrees to accept the terms hereof and represent and warrant to
the Agency that the use of this Sales Tax Agent Authorization Letter by the Agent is strictly for the purposes stated herein.


 


13.           The
Agent acknowledges that this Sales Tax Agent Authorization Letter will terminate on the date (the “Termination Date”)
that is the earlier of (i) the Expiration Date referred to above, and (ii) the expiration or termination of the Lease Agreement.
Upon the Termination Date, the agency relationship between the Agency and the Agent shall terminate.


 


(Remainder of Page Intentionally Left Blank
-Signature Page Follows)


 




    Exhibit E-4


     


    



 


The signature of a representative of the Agent
where indicated below will indicate that the Agent accepted the terms hereof.





	 	 	 	 
	 	 	ONTARIO COUNTY INDUSTRIAL DEVELOPMENT
    AGENCY
	 	 	 	 
	 	 	By:	 
	 	 	Name: 
	 	 	Title:   








	 	 	 	 
	ACCEPTED AND AGREED TO BY:	 	 
	 	 	 
	[AGENT]	 	 
	 	 	 	 
	By:	 	 	 
	Name: 	 	 
	Title:   	 	 


 




     


     


    




 


Schedule A


 


To


SALES TAX AGENT AUTHORIZATION LETTER


 


Set forth below is a description of items
that are eligible for the Sales Tax Exemption


 


Eligible Items shall mean the following
items of personal property and services, but excluding any Ineligible Items, with respect to which the Agent shall be entitled
to claim a Sales Tax Exemption in connection with the Facility:


 


		(i)	purchases of materials, goods, personal property and fixtures and supplies that will be incorporated
into and made an integral component part of the Facility;



 


		(ii)	purchases or leases of any item of materials, goods, machinery, equipment, furniture, furnishings,
trade fixtures and other tangible personal property having a useful life of one year of more;



 


		(iii)	with respect to the eligible items identified in (ii) above: purchases of freight, installation,
maintenance and repair services required in connection with the shipping, installation, use, maintenance or repair of such items;
provided that maintenance shall mean the replacement of parts or the making of repairs;



 


		(iv)	purchases of materials, goods and supplies that are to be used and substantially consumed in the
course of construction or renovation of the Facility (but excluding fuel, materials or substances that are consumed in the course
of operating machinery and equipment or parts containing fuel, materials or substances where such parts must be replaced whenever
the substance is consumed); and



 


		(v)	leases of machinery and equipment solely for temporary use in connection with the construction
or renovation of the Facility.



 


Ineligible Items shall mean the following
items of personal property and services with respect to which the Agent shall not be entitled to claim a Sales Tax Exemption in
connection with the Facility:


 


		(i)	vehicles of any sort, including watercraft and rolling stock;



 


		(ii)	personalty having a useful life of one year or less;



 


		(iii)	any cost of utilities, cleaning services or supplies or other ordinary operating costs;



 


		(iv)	ordinary office supplies such as pencils, paper clips and paper;



 


		(v)	any materials or substances that are consumed in the operation of machinery;



 


		(vi)	equipment or parts containing materials or substances where such parts must be replaced whenever the substance is consumed;
and



 


		(vii)	maintenance of the type as shall constitute janitorial services.



 




    1


     


    


 


Schedule B


 


To


SALES TAX AGENT AUTHORIZATION LETTER


 


SALES TAX REGISTRY


 


Please Complete: REPORTED PERIOD: SEMI-ANNUAL PERIOD
FROM [JANUARY 1][JULY 1], 201__ to [JUNE 30][DECEMBER 31], 201__


 


	Description of Item (incl. Serial #,if applicable)	Location of Item	Dollar Amount	Vendor
Description	Date
of Payment	Purchase
order or invoice number	Sales
Tax Savings
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 


 


	TOTAL SALES TAX SAVINGS REALIZED DURING THE SEMI-ANNUAL REPORTED PERIOD:	 


 


Certification: I, the undersigned, an
authorized officer or principal owner of the company identified below, hereby certify to the best of my knowledge and belief that
all information contained in this report is true and complete. The information reported in this form includes all Company Sales
Tax Savings realized by the company identified below and its principals, affiliates, tenants, subtenants, contractors and subcontractors.
This form and information provided pursuant hereto may be disclosed to the Ontario County Industrial Development Agency (“OCIDA”),
and may be disclosed by OCIDA in connection with the administration of the programs by OCIDA; and, without limiting the foregoing,
such information may be included in reports or disclosure required by law.





	 	 	 	 
	Name of Agent:	 	 
	 	 	 
	Signature By:	 	 
	 	 	 
	Name (print):	 	 
	 	 	 
	Title:	 	 	 
	 	 	 	 
	Date:	 	 	 



 




    2


     


    


 


EXHIBIT F


 


Sales Tax Registry


 


Please Complete: REPORTED PERIOD: ANNUAL PERIOD FROM
JULY 1, 201__ to JUNE 30, 201__


 


	Description of Item (incl. Serial #,if applicable)	Location of Item	Dollar Amount	Vendor
Description	Date
of Payment	Purchase
order or invoice number	Sales
Tax Savings
	SEMI-ANNUAL PERIOD FROM JULY 1, [____] to DECEMBER 31, [____]
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	TOTAL SALES TAX SAVINGS REALIZED DURING THE SEMI-ANNUAL PERIOD FROM JULY 1, [____] to DECEMBER 31, [____]:	 
	SEMI-ANNUAL PERIOD FROM JANUARY 1, [____] to JUNE 30, [____]
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	TOTAL SALES TAX SAVINGS REALIZED DURING THE SEMI-ANNUAL PERIOD FROM JANUARY 1, [____] to JUNE 30, [____]:	 
	TOTAL SALES TAX SAVINGS REALIZED DURING THE ANNUAL REPORTED PERIOD:	 
	 	 	 	 	 	 	 


Certification: I, the undersigned, an authorized
officer or principal owner of the Company, hereby certify to the best of my knowledge and belief that all information contained
in this report is true and complete. The information reported in this form includes all Company Sales Tax Savings realized by the
Company below and its principals, affiliates, tenants, subtenants, contractors, subcontractors and any other person or entity pursuant
to the LETTER OF AUTHORIZATION FOR SALES TAX EXEMPTION issued to the Company, and any SALES TAX AGENT AUTHORIZATION LETTER issued
to any other person or entity at the direction of the Company, by the Ontario County Industrial Development Agency (“OCIDA”).
This form and information provided pursuant hereto may be disclosed by OCIDA in connection with the administration of the programs
by OCIDA; and, without limiting the foregoing, such information may be included in reports or disclosure required by law.





	 	 	 	 
	Company
Name:	 	 
	 	 	 
	Signature By:	 	 
	 	 	 
	Name (print):	 	 
	 	 	 
	Title:	 	 	 
	 	 	 	 
	Date:	 	 	 


 




    3


     


    


 


EXHIBIT G


 


OCIDA Local Requirements Policy


 


For any project to receive PILOT
abatements the project must satisfy the following criteria:


 


		a.	Projects using at least 80% Local Labor for the construction or renovation of new, expanded, or
renovated facilities. “Local Labor” is defined as persons residing in Ontario, Monroe, Livingston, Seneca, Wayne, or
Yates Counties. A waiver process will be available for projects requiring specialty contractors and/or involving significant cost
increases due to local labor requirements.



 


		b.	Projects for which at least 80% of the building materials purchased by the applicant, its contractors
or sub-contractors and used in connection with the acquisition, construction, and equipping of the facility are purchased from
within Ontario, Monroe, Livingston, Seneca, Wayne, or Yates Counties. A waiver process will be available for projects involving
significant cost increases due to local content requirements.



 




    4


     


    






 


EXHIBIT H


 


Exceptions
to Representations and Warranties of Company


 


None.


 




    5


     


    

 


EXHIBIT I


 


Form
of Tenant Agency Compliance Agreement


 


THIS TENANT AGENCY
COMPLIANCE AGREEMENT, dated as of ________, 20__, is between the ONTARIO COUNTY INDUSTRIAL DEVELOPMENT AGENCY, a public benefit
corporation of the State of New York, having its office at 20 Ontario Street, Canandaigua, New York 14424 (the “Agency”),
and _______________________, a [banking corporation] [business corporation] [general partnership] [limited liability company] [limited
liability partnership] [limited partnership] duly organized and validly existing under the laws of the State of ________ having
its principal office at _____________________________________ (the “Tenant”).


 


R E C I T A L S


 


WHEREAS, the Agency
was created by Chapter 533 of the Laws of 1971 of the State of New York, as amended, pursuant to Title 1 of Article 18-A
of the General Municipal Law of the State of New York (collectively, the “Act”); and


 


WHEREAS, the Agency
has agreed to assist in the acquisition of an approximately 9.995 acre parcel of land located at 5450 Campus Drive, Canandaigua,
New York 14424 (the “Land”), the renovation of portions of an existing approximately 120,000 square foot building
located thereon (the “Improvements”), and the acquisition and installation therein of certain equipment and
personal property (the “Equipment”; and, together with the Land and the Improvements, the “Facility”),
which Facility is to be leased and subleased by the Agency to Akoustis, Inc., a Delaware business corporation (the “Company”),
and used in part by the Company for its primary use as research and development, manufacturing, warehouse and professional office
space in its business as a designer and manufacturer of bulk acoustic wave filters for use in wireless technology, and to be subleased,
in part, by the Company to various existing tenants (the “Tenants”) (the “Project”); and


 


WHEREAS, the Agency
acquired a leasehold interest in the Land and the Improvements, all pursuant to the Company Lease Agreement, dated as of February
1, 2018 (the “Company Lease”), by and between the Agency and the Company; and


 


WHEREAS, the Agency
leased the Facility to the Company pursuant to the Lease and Project Agreement, dated as of February 1, 2018 (the “Lease
Agreement”), by and between the Agency and the Company; and


 


WHEREAS, the Company
intends to sublease a portion of the Facility to be used as ___________ (the “Demised Premises”) to the Tenant
pursuant to a [Tenant Lease Agreement], dated as of ___________, 20__ (the “Tenant Lease Agreement”), by and
between the Company and the Tenant, which may be amended from time to time.





 






    6


     


    

 


NOW, THEREFORE, the parties hereto hereby
agree as follows:


 


ARTICLE I

REPRESENTATIONS AND COVENANTS OF TENANT


 


Section 2.1     Representations
and Covenants of Tenant. The Tenant makes the following representations and covenants as the basis for the undertakings on
its part herein contained:


 


(a)       The
Tenant is a [banking corporation] [business corporation] [general partnership] [limited liability company] [limited liability partnership]
[limited partnership] duly organized and validly existing under the laws of the State of __________ [and authorized to transact
business in the State of New York], and in good standing under the laws of the State of New York,[and the State of [____]]
and has full legal right, power and authority to execute, deliver and perform this Tenant Agency Compliance Agreement. This Tenant
Agency Compliance Agreement has been duly authorized, executed and delivered by the Tenant.


 


(b)       To
the best of the Tenant’s knowledge, neither the execution and delivery of this Tenant Agency Compliance Agreement nor the
consummation of the transactions contemplated hereby nor the fulfillment of or compliance with the provisions hereof will conflict
with or result in a breach of or constitute a default under any of the terms, conditions or provisions of any law or ordinance
of the State or any political subdivision thereof, the Tenant’s organizational documents, as amended, or any restriction
or any agreement or instrument to which the Tenant is a party or by which it is bound.


 


(c)       Any
and all leasehold improvements undertaken by the Tenant with respect to the Demised Premises and the design, acquisition, construction,
renovation, equipping and operation thereof by the Tenant will conform in all material respects with all applicable zoning, planning,
building and environmental laws, ordinances, rules and regulations of governmental authorities having jurisdiction over the Facility.
The Tenant shall defend, indemnify and hold harmless the Agency from any liability or expenses, including reasonable attorneys’
fees, resulting from any failure by the Tenant to comply with the provisions of this subsection.


 


(d)       The
Tenant Agency Compliance Agreement constitutes a legal, valid and binding obligation of the Tenant enforceable against the Tenant
in accordance with its terms.


 


(e)       Under
penalty of perjury, the Tenant certifies that it is in substantial compliance with all local, state, and federal tax, worker protection
and environmental laws, rules and regulations.





 






    7


     


    

 


ARTICLE II

INSURANCE


 


Section
2.1     Insurance Required. At all times throughout the Lease Term, the Tenant shall, at its
sole cost and expense, maintain or cause to be maintained insurance against such risks, and for such amounts, as are
customarily insured against by businesses of like size and type and shall pay, as the same become due and payable, all
premiums with respect thereto. Such insurance shall include, without limitation, the following (but without duplication of
insurance provided by the Company pursuant to the Lease Agreement covering the same risks and insured(s)):


 


(a)          Insurance
against loss or damage by fire, lightning and other casualties customarily insured against, with a uniform standard extended coverage
endorsement, such insurance to be in an amount not less than the full replacement value of the completed Improvements, exclusive
of footings and foundations, as determined by a recognized appraiser or insurer selected by the Tenant, but in no event less than
$1,000,000. During the construction of the Facility, such policy shall be written in the so-called “Builder’s Risk
Completed Value Non-Reporting Form” and shall contain a provision granting the insured permission to complete and/or occupy.


 


(b)          Workers’
compensation insurance, disability benefits insurance and each other form of insurance that the Tenant is required by law to provide,
covering loss resulting from injury, sickness, disability or death of employees of the Tenant or any permitted sublessee who are
located at or assigned to the Facility. This coverage shall be in effect from and after the date any such employees first occupy
the Facility.


 


(c)          Insurance
protecting the Agency and the Tenant against loss or losses from liability imposed by law or assumed in any written contract (including
the contractual liability assumed by the Tenant under Section 3.2 hereof) or arising from personal injury, including bodily
injury or death, or damage to the property of others, caused by an accident or other occurrence, with a limit of liability of not
less than $1,000,000 (combined single limit for personal injury, including bodily injury or death, and property damage), and blanket
excess liability coverage, in an amount not less than $5,000,000 combined single limit or equivalent, protecting the Agency and
the Tenant against any loss or liability or damage for personal injury, including bodily injury or death, or property damage. This
coverage shall also be in effect during any construction or renovation period with respect to the Demised Premises.


 


(d)         During
any construction period with respect to the Demised Premises (and for at least one year thereafter in the case of Products and
Completed Operations as set forth below), the Tenant shall cause the general contractor to carry liability insurance of the type
and providing the minimum limits set forth below:


 


		(i)	Workers’ compensation and employer’s liability with limits in accordance with applicable
law.



 


		(ii)	Comprehensive general liability providing coverage for:



 


Premises and Operations





Products and Completed Operations





Owners Protective





Contractors Protective


Contractual Liability





Personal Injury Liability





Broad Form Property Damage





(including completed operations)





Explosion Hazard





Collapse Hazard


Underground Property Damage Hazard



 






    8


     


    







 


Such insurance shall have a limit
of liability of not less than $1,000,000 (combined single limit for personal injury, including bodily injury or death, and property
damage).


 


		(iii)	Business auto liability, including all owned, non-owned and hired autos, with a limit of liability
of not less than $1,000,000 (combined single limit for personal injury, including bodily injury or death, and property damage).



 


		(iv)	Excess “umbrella” liability providing liability Insurance in excess of the coverages
in (i), (ii) and (iii) above with a limit of not less than $5,000,000.



 


Section 2.2           Additional
Provisions Respecting Insurance.


 


(a)          All
insurance required by this Tenant Agency Compliance Agreement shall be procured and maintained in financially sound and generally
recognized responsible insurance companies authorized to write such insurance in the State and selected by the entity required
to procure the same. The company issuing the policies required by Section 2.1(a) hereof shall be rated “A” or better
by A.M. Best Co., Inc. in Best’s Key Rating Guide. Such insurance may be written with deductible amounts comparable to those
on similar policies carried by other companies engaged in businesses similar in size, character and other respects to those in
which the procuring entity is engaged. All policies of insurance required by Section 2.1 hereof shall provide for at least
thirty (30) days prior written notice to the Agency of the restriction, cancellation or modification thereof. The policy evidencing
the insurance required by Section 2.1(c) hereof shall name the Agency as an additional insured. All policies evidencing the
insurance required by Section 2.1 (d)(ii) and (iv) shall name the Agency and the Tenant as additional insureds.


 


(b)          The
certificate of insurance required by Section 2.1(c) hereof shall be delivered to the Agency on or before the date hereof.
A copy of the certificates of insurance required by Section 2.1(d)(ii) and (iv) hereof shall be delivered to the Agency on
or before the commencement of any construction or renovation of the Demised Premises. The Tenant shall deliver to the Agency before
the first Business Day of each calendar year thereafter a certificate dated not earlier than the immediately preceding month reciting
that there is in full force and effect, with a term covering the current year of the Tenant’s insurance policy, insurance
of the types and in the amounts required by Section 2.1 hereof and complying with the additional requirements of Section 2.2(a)
hereof. Prior to the expiration of each such policy
or policies, the Tenant shall furnish to the Agency and any other appropriate Person a new policy or policies of insurance or
evidence that such policy or policies have been renewed or replaced or are no longer required by this Tenant Agency Compliance
Agreement. The Tenant shall provide such further information with respect to the insurance coverage required by this Tenant Agency
Compliance Agreement as the Agency may from time to time reasonably require.


 






    9


     


    




 


Section 2.3     Application
of Net Proceeds of Insurance. The Net Proceeds of the insurance carried pursuant to the provisions of Section 2.1(c) and
(d) hereof shall be applied toward extinguishment or satisfaction of the liability with respect to which such insurance proceeds
may be paid. The Net Proceeds of the insurance carried pursuant to the provisions of Section 2.1(a) hereof shall be applied in
accordance with the provisions of the Tenant Lease Agreement.


 


Section 2.4     Right
of Agency to Pay Insurance Premiums. If the Tenant fails to maintain or cause to be maintained any insurance required to be
maintained by Section 2.1 hereof, the Agency may pay or cause to be paid the premium for such insurance. No such payment shall
be made by the Agency until at least ten (10) days shall have elapsed since notice shall have been given by the Agency to the Tenant.
No such payment by the Agency shall affect or impair any rights of the Agency hereunder arising in consequence of such failure
by the Tenant. The Tenant shall, on demand, reimburse the Agency for any amount so paid pursuant to this Section, together with
interest thereon from the date of payment of such amount by the Agency.


 


ARTICLE III

SPECIAL COVENANTS


 


Section 3.1     No
Warranty of Condition or Suitability by Agency. THE AGENCY HAS MADE AND MAKES NO REPRESENTATION OR WARRANTY WHATSOEVER, EITHER
EXPRESS OR IMPLIED, WITH RESPECT TO THE MERCHANTABILITY, CONDITION, FITNESS, DESIGN, OPERATION OR WORKMANSHIP OF ANY PART OF THE
FACILITY, ITS FITNESS FOR ANY PARTICULAR PURPOSE, THE QUALITY OR CAPACITY OF THE MATERIALS IN THE FACILITY, OR THE SUITABILITY
OF THE DEMISED PREMISES FOR THE PURPOSES OR NEEDS OF THE TENANT OR THE EXTENT TO WHICH FUNDS AVAILABLE TO THE TENANT WILL BE SUFFICIENT
TO PAY THE COST OF COMPLETION OF THE DEMISED PREMISES. THE TENANT ACKNOWLEDGES THAT THE AGENCY IS NOT THE MANUFACTURER OF THE EQUIPMENT
NOR THE MANUFACTURER’S AGENT NOR A DEALER THEREIN. THE TENANT, ON BEHALF OF ITSELF IS SATISFIED THAT THE DEMISED PREMISES
IS SUITABLE AND FIT FOR PURPOSES OF THE TENANT. THE AGENCY SHALL NOT BE LIABLE IN ANY MANNER WHATSOEVER TO THE TENANT OR ANY OTHER
PERSON FOR ANY LOSS, DAMAGE OR EXPENSE OF ANY KIND OR NATURE CAUSED, DIRECTLY OR INDIRECTLY, BY THE PROPERTY OF THE FACILITY OR
THE USE OR MAINTENANCE THEREOF OR THE FAILURE OF OPERATION THEREOF, OR THE REPAIR, SERVICE OR ADJUSTMENT THEREOF, OR BY ANY DELAY
OR FAILURE TO PROVIDE ANY SUCH
MAINTENANCE, REPAIRS, SERVICE OR ADJUSTMENT, OR BY ANY INTERRUPTION OF SERVICE OR LOSS OF USE THEREOF OR FOR ANY LOSS OF BUSINESS
HOWSOEVER CAUSED.


 






    10


     


    




 


Section 3.2     Hold
Harmless Provisions.


 


(a)       The
Tenant agrees that the Agency and its directors, members, officers, agents (except the Company) and employees shall not be liable
for, and agrees to defend, indemnify, release and hold the Agency and its directors, members, officers, agents and employees harmless
from and against, any and all (i) liability for loss or damage to Property or injury to or death of any and all Persons that
may be occasioned by, directly or indirectly, any cause whatsoever pertaining to the Demised Premises or to common areas or other
portions of the Facility to which the Tenant has regular access (such areas, together with the Demised Premises, are hereinafter
referred to as the “Tenant Premises”), or arising by reason of or in connection with the occupation or the use
thereof or the presence of any Person or Property on, in or about the Tenant Premises, and (ii) liability arising from or
expense incurred in connection with the Agency’s participation in the subleasing of the Demised Premises to the Tenant, including,
without limiting the generality of the foregoing, all claims arising from the breach by the Tenant of any of its covenants contained
herein, the exercise by the Tenant of any authority conferred upon it pursuant to this Tenant Agency Compliance Agreement and all
causes of action and reasonable attorneys’ fees (whether by reason of third party claims or by reason of the enforcement
of any provision of this Tenant Agency Compliance Agreement (including without limitation this Section) or any other documents
delivered by the Agency in connection with this Tenant Agency Compliance Agreement), and any other expenses incurred in defending
any claims, suits or actions which may arise as a result of any of the foregoing, to the extent that any such losses, damages,
liabilities or expenses of the Agency are not incurred and do not result from the gross negligence or intentional or willful wrongdoing
of the Agency or any of its directors, members, agents or employees. Except as otherwise provided herein, the foregoing indemnities
shall apply notwithstanding the fault or negligence in part of the Agency, or any of its members, directors, officers, agents or
employees, and irrespective of the breach of a statutory obligation or the application of any rule of comparative or apportioned
liability. The foregoing indemnities are limited only to the extent of any prohibitions imposed by law, and upon the application
of any such prohibition by the final judgment or decision of a competent court of law, the remaining provisions of these indemnities
shall remain in full force and effect.


 


(b)       Notwithstanding
any other provisions of this Tenant Agency Compliance Agreement, the obligations of the Tenant pursuant to this Section shall remain
in full force and effect after the termination of this Tenant Agency Compliance Agreement until the expiration of the period stated
in the applicable statute of limitations during which a claim, cause of action or prosecution relating to the matters herein described
may be brought, and payment in full or the satisfaction of such claim, cause of action or prosecution relating to the matters herein
described and the payment of all expenses and charges incurred by the Agency or its members, directors, officers, agents and employees
relating to the enforcement of the provisions herein specified.


 






    11


     


    

 


(c)       In
the event of any claim against the Agency or its members, directors, officers, agents or employees by any employee or contractor
of the Tenant or anyone directly or indirectly employed by any of them or anyone for whose acts any of them may be liable, the
obligations of the Tenant hereunder shall not be limited in any way by any limitation on the amount or type of damages, compensation,
disability benefits or other employee benefit acts.


 


Section 3.3     Right
to Inspect Demised Premises. The Agency and its duly authorized agents shall have the right at all reasonable times and upon
reasonable prior written notice to inspect the Demised Premises.


 


Section 3.4     Qualification
as Project.


 


(a)       The
Tenant will not take any action, or fail to take any action, which action or failure to act would cause the Facility not to constitute
a “project” as such quoted term is defined in the Act. Without limiting the generality of the foregoing, the Tenant
will in no event use the Demised Premises in such a way as to cause or permit the Facility to be used in violation of Section 862(2)(a)
of the Act.


 


(b)       The
occupation of the Demised Premises has not and will not result in the removal of a facility or plant of the Tenant from one area
of the State to another area of the State or in the abandonment of one or more plants or facilities of the Tenant located within
the State.


 


Section 3.5     Compliance
with Orders, Ordinances, Etc.


 


(a)       The
Tenant, throughout the Lease Term, agrees that it will promptly comply, and cause any sublessee of the Tenant or occupant of the
Demised Premises which is occupying the Demised Premises by permission of the Tenant to comply, with all statutes, codes, laws,
acts, ordinances, orders, judgments, decrees, injunctions, rules, regulations, permits, licenses, authorizations, directions and
requirements, ordinary or extraordinary, which now or at any time hereafter may be applicable to the Facility or the Demised Premises,
or to the acquisition, construction and equipping of the Demised Premises, or to any use, manner of use or condition of the Facility
or any part of the Demised Premises, of all federal, state, county, municipal and other governments, departments, commissions,
boards, courts, authorities, officials and officers having jurisdiction of the Facility or any part thereof, and companies or associations
insuring the premises.





 






    12


     


    

 


(b)       The
Tenant shall keep or cause the Demised Premises to be kept free of Hazardous Substances. Without limiting the foregoing, the Tenant
shall not cause or permit the Demised Premises to be used to generate, manufacture, refine, transport, treat, store, handle, dispose,
transfer, produce or process Hazardous Substances, except in compliance with all applicable federal, state and local laws or regulations,
nor shall the Tenant cause or permit, as a result of any intentional or unintentional act or omission on the part of the Tenant
or any of its contractors, subcontractors or tenants, a release of Hazardous Substances onto the Facility or onto any other property.
The Tenant shall comply with, and ensure compliance
by all of its contractors, subcontractors and subtenants with, all applicable federal, state and local environmental laws, ordinances,
rules and regulations, whenever and by whomever triggered, and shall obtain and comply with, and ensure that all of its contractors,
subcontractors and subtenants obtain and comply with, any and all approvals, registrations or permits required thereunder. The
Tenant shall (i) conduct and complete all investigations, studies, sampling and testing and all remedial, removal and other
actions necessary to clean up and remove all Hazardous Substances released, stored, generated or used by it on, from or affecting
the Demised Premises (A) in accordance with all applicable federal, state and local laws, ordinances, rules, regulations
and policies, (B) to the satisfaction of the Agency, and (C) in accordance with the orders and directives of all federal,
state and local governmental authorities; and (ii) defend, indemnify and hold harmless the Agency, its employees, agents,
officers, members and directors, from and against any claims, demands, penalties, fines, liabilities, settlements, damages, costs
or expenses of whatever kind or nature, known or unknown, contingent or otherwise, arising out of, or in any way related to (A) the
presence, disposal, release or threatened release of any Hazardous Substances which are on, from or affecting the soil, water,
vegetation, buildings, personal property, persons, animals or otherwise, (B) any bodily injury, personal injury (including
wrongful death) or property damage (real or personal) arising out of or related to such Hazardous Substances, (C) any lawsuit
brought or threatened, settlement reached, or government order relating to such Hazardous Substances, or (D) any violation
of laws, orders, regulations, requirements or demands of government authorities, or of any policies or requirements of the Agency,
which are based upon or in any way related to such Hazardous Substances, and in all cases which result from the intentional or
unintentional act or omission of the Tenant or any of its contractors, subcontractors or subtenants, including, without limitation,
reasonable attorney and consultant fees, investigation and laboratory fees, court costs and litigation expenses. The provisions
of this Section shall be in addition to any and all other obligations and liabilities the Tenant may have to the Agency at common
law and shall survive the transactions contemplated herein.


 


(c)       Notwithstanding
the provisions of subsections (a) and (b) above, the Tenant may in good faith contest the validity or the applicability of
any requirement of the nature referred to in such subsections (a) and (b) by appropriate legal proceedings conducted in good
faith and with due diligence. In such event, the Tenant may fail to comply with the requirement or requirements so contested during
the period of such contest and any appeal therefrom, unless the Agency shall notify the Tenant that, by failure to comply with
such requirement or requirements, the Facility or any part thereof may be subject to loss, penalty or forfeiture, in which event
the Tenant shall promptly take such action with respect thereto or provide such security as shall be reasonably satisfactory to
the Agency. If at any time the then existing use or occupancy of the Demised Premises shall, pursuant to any zoning or other law,
ordinance or regulation, be permitted only so long as such use or occupancy shall continue, the Tenant shall use reasonable efforts
not to cause or permit such use or occupancy by the Tenant to be discontinued without the prior written consent of the Agency,
which consent shall not be unreasonably withheld.


 






    13


     


    

 


(d)       Notwithstanding
the provisions of this Section, if, because of a breach or violation of the provisions of subsection (a) or (b) above (without
giving effect to subsection (c)), the Agency or any of its members, directors, officers, agents or employees shall be threatened
with a fine, liability, expense or imprisonment, then, upon notice from the Agency, the Tenant shall immediately provide legal
protection or pay an amount or post a bond in an amount necessary, in the opinion of the Agency and of its members, directors,
officers, agents and employees, to the extent permitted by applicable law, to remove the threat of such fine, liability, expense
or imprisonment.


 


(e)       Notwithstanding
any provisions of this Section, the Agency retains the right to defend itself in any action or actions which are based upon or
in any way related to such Hazardous Substances. In any such defense of itself, the Agency shall select its own counsel, and any
and all costs of such defense, including, without limitation, reasonable attorney and consultant fees, investigation and laboratory
fees, court costs and litigation expenses, shall be paid by the Tenant.


 


Section 3.6     Agreement
to Provide Information. Annually, the Tenant shall provide the Agency with a certified statement and documentation (i) enumerating
the FTE jobs, by category, retained and/or created at the Facility as a result of the Agency’s financial assistance and (ii)
indicating the fringe benefits and salary averages or ranges for such categories of FTE jobs created and/or retained.1
The Tenant further agrees to provide and certify or cause to be provided and certified whenever requested by the Agency any other
information concerning the Tenant, its respective finances, its respective operations, its respective employment and its affairs
necessary to enable the Agency to make any report required by law, governmental regulation, including, without limitation, any
reports required by the Act, the Public Authorities Accountability Act of 2005, or the Public Authorities Reform Act of 2009, each
as amended from time to time, or any other reports required by the New York State Authority Budget Office or the Office of the
State Comptroller, or any of the Agency Documents or Tenant Documents. Such information shall be provided within thirty (30)
days following written request from the Agency.


 


Section 3.7     Employment
Opportunities; Notice of Jobs. The Tenant covenants and agrees that, in consideration of the participation of the Agency in
the transactions contemplated herein, it will, except as otherwise provided by collective bargaining contracts or agreements to
which it is a party, cause any new employment opportunities created in connection with the Demised Premises to be listed with the
New York State Department of Labor, Community Services Division and with the administrative entity of the service delivery area
created pursuant to the Job Training Partnership Act (PL 97-300), as superseded by the Workforce Innovation and Opportunity Act
(PL. 113-128), in which the Facility is located (collectively, the “Referral Agencies”). The Tenant also agrees
that it will, except as otherwise provided by collective bargaining contracts or agreements to which it is a party, first consider
for such new employment opportunities persons eligible to participate in federal job training partnership programs who shall be
referred by the Referral Agencies.


 





 






1Cannot
be removed or modified; required by GML Section 859-a(6)(b).


 






    14


     


    

 


Section 3.8     Subleasing.


 


(a)          In
accordance with Section 862(1) of the Act, the Demised Premises shall not be occupied by a sublessee whose tenancy would result
in the removal of a facility or plant of the proposed sublessee from one area of the State to another area of the State or in the
abandonment of one or more plants or facilities of such sublessee located within the State; provided, however, that neither restriction
shall apply if the Agency shall determine:


 


		(i)	that such occupation of the Demised Premises is reasonably necessary to discourage the proposed
sublessee from removing such other plant or facility to a location outside the State, or



 


		(ii)	that such occupation of the Demised Premises is reasonably necessary to preserve the competitive
position of the proposed sublessee in its respective industry.



 


(b)          The
Tenant may not assign the Tenant Lease Agreement or sub-sublease the Demised Premises without the prior written consent of the
Agency.  Any assignment or sub-sublease shall conform with the restrictions and requirements set forth in Section 9.3 of the
Lease Agreement.


 


Section 3.9       Approval
of Tenant Lease Agreement. The Agency hereby approves the subleasing of the Facility by the Company to the Tenant pursuant
to the terms of the Tenant Lease Agreement.


 


Section 3.10     Definitions.
All capitalized terms used in this Tenant Agency Compliance Agreement and not otherwise defined herein shall have the meanings
assigned thereto in the Schedule of Definitions attached to the Lease Agreement as Schedule A.


 


Section 3.11     Execution
of Counterparts. This Tenant Agency Compliance Agreement may be executed in several counterparts, each of which shall be an
original and all of which shall constitute but one and the same instrument.


 


(Remainder of Page Intentionally Left Blank
– Signature Page Follows)


 




    15


     


    

 


IN WITNESS WHEREOF,
the Agency and the Tenant have caused this Tenant Agency Compliance Agreement to be executed in their respective names by their
duly authorized representatives, all as of _____________, 20__.


 





	 	ONTARIO COUNTY INDUSTRIAL DEVELOPMENT AGENCY
	 	 	 
	 	By:	 
	 	Name:
	 	Title:
	 	 	 
	 	[NAME OF ENTITY]
	 	 	 
	 	By:	 
	 	Name:
	 	Title:






 




    16


     


    

 


SCHEDULE A


 


SCHEDULE OF DEFINITIONS


 


“Act”
means, collectively, Title 1 of Article 18-A of the General Municipal Law of the State, enacted into law as Chapter 1030
of the Laws of 1969 of the State, as amended, together with Chapter 533 of the Laws of 1971 of the State, as amended.


 


“Agency”
means (i) the Ontario County Industrial Development Agency, its successors and assigns, and (ii) any local governmental
body resulting from or surviving any consolidation or merger to which the Agency or its successors may be a party.


 


“Agency Documents”
means the Company Lease and the Lease Agreement.


 


“Agent”
shall have the meaning set forth in Section 5.2(d).


 


“Approving
Resolution” or “Authorizing Resolution” means the resolution adopted by the Agency on April 24, 2017,
authorizing the execution and delivery of the Agency Documents, as such resolution may be amended and supplemented from time to
time.


 


“Authorized
Representative” means, in the case of the Agency, the Chairman, the Vice Chairman, the Secretary, the Assistant Secretary,
the Executive Director or any member or officer of the Agency and such additional persons as, at the time, are designated to act
on behalf of the Agency; and in the case of the Company, the President, Vice President, CEO or any officer of the Company and such
additional persons as, at the time, are designated to act on behalf of the Company.


 


“Bill of Sale”
means the Bill of Sale, dated the Closing Date, given by the Company to the Agency with respect to the Equipment, as the same may
be amended from time to time.


 


“Business
Day” means any day other than a Saturday, a Sunday, a legal holiday or a day on which banking institutions in New York,
New York, or any city in which the principal office of the Lender, if any, is located are authorized by law or executive order
to remain closed.


 


“Closing Date”
means February 27, 2018.


 


“Company”
means Akoustis, Inc., a business corporation organized and validly existing under the laws of the State of Delaware and authorized
to transact business in the State of New York and its successors and assigns.


 


“Company Documents”
means the Bill of Sale, the Company Lease and the Lease Agreement.


 


“Company Lease”
means the Company Lease Agreement, dated as of February 1, 2018, by and between the Company and the Agency, as the same may be
amended from time to time.


 






    Schedule A-1


     


    

 


“Company Sales
Tax Savings” means all Sales Tax Exemption savings realized by or for the benefit of the Company, including any savings
realized by any Agent on behalf of the Company, pursuant to this Lease Agreement and each Sales Tax Agent Authorization Letter
issued in connection with the Facility.


 


“Completion
Date” means the date of completion of the Facility as certified pursuant to Section 3.6 of the Lease Agreement.


 


“Condemnation”
means the taking of title to, or the use of, Property under the exercise of the power of eminent domain by any governmental entity
or other Person acting under governmental authority.


 


“Construction
Period” means the period beginning on the earlier of (a) Closing Date and (b) the date of commencement of the Project
Work of the Facility, and ending on the Completion Date.


 


“Disposal”
has the same meaning as given to that term in the Solid Waste Disposal Act as amended by the Resource Conservation and Recovery
Act, (42 U.S.C. Section 6901 et seq.)


 


“Eligible
Items” shall mean the following items of personal property and services, but excluding any Ineligible Items, with respect
to which the Company and any Agent shall be entitled to claim a Sales Tax Exemption in connection with the Facility: (i) purchases
of materials, goods, personal property and fixtures and supplies that will be incorporated into and made an integral component
part of the Facility; (ii) purchases or leases of any item of materials, goods, machinery, equipment, furniture, furnishings, trade
fixtures and other tangible personal property having a useful life of one year or more; (iii) with respect to the eligible items
identified in (ii) above; purchases of freight, installation, maintenance and repair services required in connection with the shipping,
installation, use, maintenance or repair of such items; provided that maintenance shall mean the replacement of parts or the making
of repairs; (iv) purchases of materials, goods and supplies that are to be used and substantially consumed in the course of construction
or renovation of the Facility (but excluding fuel, materials or substances that are consumed in the course of operating machinery
and equipment or parts containing fuel, materials or substances where such parts must be replaced whenever the substance is consumed);
and (v) leases of machinery and equipment solely for temporary use in connection with the construction or renovation of the Facility.


 


“Environment”
means any water or water vapor, any land, including land surface or subsurface, air, fish, wildlife, flora, fauna, biota and all
other natural resources.


 


“Environmental
Laws” means all federal, state and local environmental, land use, zoning, health, chemical use, safety and sanitation
laws, statutes, ordinances and codes relating to the protection, preservation or remediation of the Environment and/or governing
the use, storage, treatment, generation, transportation, processing, handling, production or disposal of Hazardous Substances and
the rules, regulations, written and published policies, guidelines, decisions, orders
and directives of federal, state and local governmental agencies and authorities with respect thereto.


 






    Schedule A-2


     


    




 


“Environmental
Permits” means all permits, licenses, approvals, authorizations, consents or registrations required by any applicable
Environmental Law in connection with the ownership, construction, renovation, equipping, use and/or operation of the Facility,
for the storage, treatment, generation, transportation, processing, handling, production or disposal of Hazardous Substances or
the sale, transfer or conveyance of the Facility.


 


“Equipment”
means all machinery, equipment and other personal property used and to be used in connection with the Facility as described in
Exhibit B to the Lease Agreement.


 


“Event of
Default” means (a) when used with respect to the Lease Agreement, any of the events defined as Events of Default
by Section 10.1 of the Lease Agreement, and (b) when used with respect to any Mortgage, any of the events defined as Events
of Default in such Mortgage.


 


“Facility”
means, collectively, the Land, the Improvements and the Equipment, leased and subleased to the Company pursuant to the Lease Agreement.


 


“Form ST-60”
shall mean NYSDTF Form ST-60 “IDA Appointment of Project Operator or Agent” or such additional or substitute form as
is adopted by NYSDTF to report the appointment of project operators or agents with respect to industrial development agency transactions.


 


“Form ST-123”
shall mean NYSDTF Form ST-123 “IDA Agent or Project Operator Exempt Purchase Certificate” or such additional or substitute
form as is adopted by NYSDTF for use in completing purchases that are exempt for Sales and Use Taxes with respect to industrial
development agency transactions.


 


“Form ST-340”
shall mean NYSDTF Form ST-340 “Annual Report of Sales and Use Tax Exemptions Claimed by Agent/Project Operator of Industrial
Development Agency/Authority” or such additional or substitute form as is adopted by NYSDTF to report Company Sales Tax Savings
with respect to industrial development agency transactions.


 


“FTE”
shall have the meaning set forth in Section 8.11 of the Lease Agreement.


 


“Hazardous
Substance” means, without limitation, any flammable, explosive, radon, radioactive materials, asbestos, urea formaldehyde
foam insulation, polychlorinated biphenyls, petroleum, petroleum constituents, petroleum products, methane, hazardous materials,
hazardous wastes, hazardous or toxic substances or related materials, pollutants, or toxic pollutants, as defined in the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as amended (42 U.S.C. Sections 9601, et seq.), the
Resource Conservation and Recovery Act, as amended (42 U.S.C. Sections 6901, et seq.), the Hazardous Materials Transportation
Act, as amended (49 U.S.C. Sections 1801, et seq.), the Toxic Substances Control Act, as amended (15 U.S.C. Sections 2601,
et seq.), the Federal Water Pollution Control Act, as amended (33 U.S.C. Sections 1251 et seq.), Articles 17
and 27 of the New York State Environmental Conservation
Law, or any other applicable Environmental Law and the regulations promulgated thereunder.


 






    Schedule A-3


     


    




 


“Improvements”
means all those buildings, improvements, structures and other related facilities (i) affixed or attached to the Land, and
(ii) not part of the Equipment, all as they may exist from time to time.


 


“Independent
Accountant” shall mean an independent certified public accountant or firm of independent certified public accountants
selected by the Company and approved by the Agency (such approval not to be unreasonably withheld or delayed).


 


“Independent
Counsel” means an attorney or attorneys or firm or firms of attorneys duly admitted to practice law before the highest
court of any state of the United States of America or in the District of Columbia and not a full time employee of the Agency, the
Company or the Sublessee.


 


“Ineligible
Items” shall mean the following items of personal property and services with respect to which the Company and any Agent
shall not be entitled to claim a Sales Tax Exemption in connection with the Facility:


 


		(i)	vehicles of any sort, including watercraft and rolling stock;



 


		(ii)	personalty having a useful life of one year or less;



 


		(iii)	any cost of utilities, cleaning services or supplies or other ordinary operating costs;



 


		(iv)	ordinary office supplies such as pencils, paper clips and paper;



 


		(v)	any materials or substances that are consumed in the operation of machinery;



 


		(vi)	equipment or parts containing materials or substances where such parts must be replaced whenever
the substance is consumed; and



 


		(vii)	maintenance of the type as shall constitute janitorial services.



 


“Land”
means the real property leased by the Agency to the Company pursuant to the Lease Agreement and more particularly described in
Exhibit A attached thereto.


 


“Lease Agreement”
means the Lease and Project Agreement, dated as of February 1, 2018 by and between the Agency, as lessor, and the Company, as lessee,
with respect to the Facility, as the same may be amended from time to time.


 


“Lease Term”
means the duration of the leasehold estate created by the Lease Agreement as specified in Section 4.2 of the Lease Agreement.


 






    Schedule A-4


     


    

 


“Lender”
means any lender making a Loan to the Company to finance in whole or in part the Project Work, the acquisition and/or development
of the Facility or any portion thereof.


 


“Lien”
means any interest in Property securing an obligation owed to a Person, whether such interest is based on the common law, statute
or contract, and including but not limited to the security interest arising from a mortgage, encumbrance, pledge, conditional sale
or trust receipt or a lease, consignment or bailment for security purposes. The term “Lien” includes reservations,
exceptions, encroachments, easements, rights-of-way, covenants, conditions, restrictions, leases and other similar title exceptions
and encumbrances, including but not limited to mechanics’, materialmen’s, warehousemen’s, carriers’ and
other similar encumbrances, affecting real property. For the purposes of this definition, a Person shall be deemed to be the owner
of any Property which it has acquired or holds subject to a conditional sale agreement or other arrangement pursuant to which title
to the Property has been retained by or vested in some other Person for security purposes.


 


“Loan”
has the meaning ascribed to such term in Section 12.4 of the Lease Agreement.


 


“Loan Documents”
has the meaning ascribed to such term in Section 12.4 of the Lease Agreement.


 


“Loss Event”
has the meaning ascribed to such term in Section 5.4 of the Lease Agreement.


 


“Maximum Company
Sales Tax Savings Amount” shall mean the aggregate maximum dollar amount of Company Sales Tax Savings that the Company
and all Agents acting on behalf the Company are permitted to receive under this Lease Agreement, which shall equal $300,193.00,
or such maximum dollar amount as may be determined by the Agency pursuant to such additional documents as may be required by the
Agency for such increase.


 


“Mortgage”
means any mortgage and security agreement granted by the Agency and the Company to a Lender which grants a mortgage lien on and
security interest in the Facility in favor of the Lender as security for such Lender’s Loan to the Company.


 


“Mortgage
Recording Tax Exemption” has the meaning ascribed to such term in Section 5.3 of the Lease Agreement.


 


“Net Proceeds”
means so much of the gross proceeds with respect to which that term is used as remain after payment of all expenses, costs and
taxes (including attorneys’ fees) incurred in obtaining such gross proceeds.


 


“NYSDTF”
means the New York State Department of Taxation and Finance.


 


“Organizational
Documents” means (i) in the case of an entity constituting a limited liability company, the articles of organization
or certificate of formation, and the operating agreement of such entity, (ii) in the case of an Entity constituting a corporation,
the articles of incorporation
or certificate of incorporation, and the by-laws of such entity, and (iii) in the case of an entity constituting a general
or limited partnership, the partnership agreement of such entity


 






    Schedule A-5


     


    

 





“Permitted
Encumbrances” means, with respect to the Facility, (i) exceptions to title set forth in the Title Report, (ii) the
Company Lease, (iii) the Lease Agreement, (iv) utility, access and other easements and rights-of-way, restrictions and exceptions
that do not materially impair the utility or the value of the Property affected thereby for the purposes for which it is intended,
(v) mechanics', materialmen's, warehousemen's, carriers' and other similar Liens which are approved in writing by the Lender,
if any, or its counsel and, if no Lender, then by the Agency or its counsel, (vi) Liens for taxes not yet delinquent, (vii)
any Mortgage granted to a Lender and (viii) purchase money security interests and blanket liens.


 


“Person”
or “Persons” means an individual, partnership, limited liability partnership, limited liability company, corporation,
trust or unincorporated organization, or a government agency, political subdivision or branch thereof.


 


“PILOT Payments”
has the meaning ascribed to such term in Section 5.1 of the Lease Agreement.


 


“Plans and
Specifications” means the plans and specifications, if any, or the information detailed as part of the Project Application
Information for the Improvements, prepared for the Company and approved by the Agency, as revised from time to time in accordance
with the Lease Agreement.


 


“Project”
means the acquisition of an approximately 9.995 acre parcel of land located at 5450 Campus Drive, Canandaigua, New York 14424,
the renovation of portions of an existing approximately 120,000 square foot building located thereon and the acquisition and installation
therein of certain equipment and personal property, which Facility is to be leased and subleased by the Agency to the Company and
used in part by the Company for its primary use as research and development, manufacturing, warehouse and professional office space
in its business as a designer and manufacturer of bulk acoustic wave filters for use in wireless technology, and to be subleased,
in part, by the Company to various existing tenants.


 


“Project Application
Information” means the application and questionnaire submitted to the Agency on February 15, 2017 by or on behalf of
the Company, for approval by the Agency of the Project, together with all other letters, documentation, reports and financial information
submitted in connection therewith.


 


“Project Work”
means the work required to complete the Project.


 


“Prime Rate”
means (i) if no Lender, the rate designated by The Wall Street Journal from time to time as its “prime rate”,
or (ii) if a Lender exists, the rate designated by the Lender from time to time as its “prime rate”.


 


“Property”
means any interest in any kind of property or asset, whether real, personal or mixed, or tangible or intangible.


 






    Schedule A-6


     


    

 


“Public Purposes”
shall mean the State’s objective to create industrial development agencies for the benefit of the several counties, cities,
villages and towns in the State and to empower such agencies, among other things, to acquire, construct, reconstruct, lease, improve,
maintain, equip and sell land and any building or other improvement, and all real and personal properties, including, but not limited
to, machinery and equipment deemed necessary in connection therewith, whether or not now in existence or under construction, which
shall be suitable for manufacturing, warehousing, research, commercial, recreation or industrial facilities, including industrial
pollution control facilities, in order to advance job opportunities, health, general prosperity and the economic welfare of the
people of the State and to improve their standard of living.


 


“Real Property
Tax Abatements” has the meaning ascribed to such term in Section 5.4 of the Lease Agreement.


 


“Recaptured
Benefits” has the meaning ascribed to such term in Section 5.4 of the Lease Agreement.


 


“Recapture
Event” has the meaning ascribed to such term in Section 5.4 of the Lease Agreement.


 


“Release”
has the meaning given to that term in the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended
(42 U.S.C. Section 9601, et seq.), and the regulations promulgated thereunder.


 


“Sales Tax
Agent Authorization Letter” shall mean the Sales Tax Agent Authorization Letter, substantially in the form set forth
in Exhibit E to the Lease Agreement – “Form of Sales Tax Agent Authorization Letter” and to be delivered
in accordance with Section 5.2(d) of the Lease Agreement or Section 5.1(d) of the Equipment Lease Agreement.


 


“Sales Tax
Exemption” shall mean an exemption from Sales and Use Taxes resulting from the Agency’s participation in the Facility.


 


“Sales Tax
Registry” shall mean the Sales Tax Registry in the form set forth in Exhibit F.


 


“Sales and
Use Taxes” shall mean local and State sales and compensating use taxes and fees imposed pursuant to Article 28 of the
New York State Tax Law, as the same may be amended from time to time.


 


“Schedule
of Definitions” means the words and terms set forth in this Schedule of Definitions attached to the Lease Agreement,
as the same may be amended from time to time.


 


“SEQR Act”
means the State Environmental Quality Review Act and the regulations thereunder.


 


“Special Provisions”
has the meaning ascribed to such term in Section 5.2 of the Lease Agreement.


 






    Schedule A-7


     


    

 


“State”
means the State of New York.


 


“State Sales
and Use Taxes” shall mean sales and compensating use taxes and fees imposed by Article 28 of the New York State Tax Law
but excluding such taxes imposed in a city by Section 1107 or 1108 of such Article 28, as the same may be amended from time to
time.


 


“State Sales
Tax Savings” shall mean all Sales Tax Exemption savings relating to State Sales and Use Taxes realized by or for the
benefit of the Company, including any savings realized by any Agent, pursuant to this Lease Agreement and each Sales Tax Agent
Authorization Letter issued in connection with the Facility.


 


“Substitute
Facilities” means facilities of substantially the same nature as the proposed Facility.


 


“Taxes on
the Facility” has the meaning ascribed to such term in Section 5.1 of the Lease Agreement.


 


“Taxing Authorities”
has the meaning ascribed to such term in Section 5.1 of the Lease Agreement.


 


“Tenant Agency
Compliance Agreement” means an agreement in the form attached to the Lease Agreement as Exhibit I between the
Agency and a sublessee of the Facility.


 


“Termination
Date” shall mean such date on which the Sales Tax Exemption authorization may terminate pursuant to the terms and conditions
of Section 5.2 of the Lease Agreement.


 


“Title Report”
means Certificate of Title No. 358591-O issued by Stewart Title Insurance Company to the Agency on April 5, 2017 and redated and
recertified on the Closing Date.


 


“Transaction
Counsel” means the law firm of Nixon Peabody LLP.


 


“Transaction
Documents” means the Agency Documents and the Company Documents.


 


“Unassigned
Rights” means the rights of the Agency and moneys payable pursuant to and under Sections 4.3, 4.4, 5.1, 5.2, 5.4,
6.4(c) and (d), 6.7, 8.1, 8.2, 8.5, 8.7, 8.8, 8.10, 8.11, 9.3, 10.2(a), 10.4, 11.2, 11.3 and 14.8 and Article XIII of the Lease
Agreement.


 






    Schedule A-8