Exhibit
10.1





 





 


STANDARD
INDUSTRIAL/COMMERCIAL MULTI-TENANT LEASE - GROSS


  


		1.	Basic
                                            Provisions (“Basic Provisions”).



 


1.1
Parties. This Lease (“Lease”), dated for reference purposes only September 14, 2022, is made
by and between Slater Palms LLC (“Lessor”) and Submersible Systems, Inc., a Florida corporation (“Lessee”), (collectively the “Parties”, or individually a “Party”).


 


1.2(a) Premises: That
certain real property, including all improvements therein or to be provided by Lessor under the terms of this Lease, commonly known
as (street address, unit/suite, city, state, zip):


 


7413
Slater Avenue, Huntington Beach, CA 92647 (“Premises”).The Premises are located in the County of Orange,
and are generally described as (describe briefly the nature of the Premises and the “Project”): a
freestanding industrial building of approximately 13,000 square feet which is part of a larger multi-tenant business park.
In addition to Lessee’s rights to use and occupy the Premises as hereinafter specified, Lessee shall have non-exclusive
rights to any utility raceways of the building containing the Premises (“Building”) and to the Common Areas (as
defined in Paragraph 2.7 below), but shall not have any rights to the roof, or exterior walls of the Building or to any other
buildings in the Project. The Premises, the Building, the Common Areas, the land upon which they are located, along with all other
buildings and improvements thereon, are herein collectively referred to as the “Project.” (See also Paragraph
2)


 


1.2(b) Parking: Twenty-six
(26) unreserved vehicle parking spaces. (See also Paragraph 2.6)


 


1.3
Term: Five (5) years and zero (0) months (“Original Term”) commencing February 1,
2023 (“Commencement Date”) and ending
January 31, 2028 (“Expiration Date”). (See also Paragraph 3)


 


1.4
Early Possession: If the Premises are available Lessee may have non-exclusive possession of the Premises commencing N/A
(“Early Possession Date”). (See also Paragraphs 3.2 and 3.3)


 


1.5
Base Rent: $17,550.00 per month (“Base Rent”), payable on the first (1st) day of each
month commencing February 1, 2023. (See also Paragraph 4)


 


☒
If this box is checked, there are provisions in this Lease for the Base Rent to be adjusted. See Paragraph 50.


 


1.6 Lessee’s
Share of Common Area Operating Expenses: --- percent ( ---%) (“Lessee’s Share”).
In the event that the size of the Premises and/or the Project are modified during the term of this Lease, Lessor shall
recalculate Lessee’s Share to reflect such modification.


 


 1.7 Base Rent and Other Monies Paid Upon Execution:




 


		(a)	Base
Rent: ---  for the period ---.



 


		(b)	Common
Area Operating Expenses: The current estimate for the period --- is ---.



 


		(c)	Security
                                            Deposit: See Paragraph 53 (“Security Deposit”). (See also Paragraph
                                            5)



 


		(d)	Other:
--- for ---.



 


		(e)	Total
Due Upon Execution of this Lease: $10,727.00.



 


1.8
Agreed Use: General office, warehousing and manufacturing of underwater breathing systems. (See also Paragraph 6)


 


 1.9 Insuring Party. Lessor is the “Insuring Party”. (See also Paragraph 8)




 



    	 	 	 
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 1.10 Real Estate Brokers. (See also Paragraph 15 and 25)




 


(a)
Representation: Each Party acknowledges receiving a Disclosure Regarding Real Estate Agency Relationship, confirms and consents
to the following agency relationships in this Lease with the following real estate brokers (“Broker(s)”) and/or their
agents (“Agent(s)”):


 


Lessor’s
Brokerage Firm


 


Lee
& Associates®-Newport Beach License No. 01197433 is the broker of (check one): ☒ the Lessor; or
☐ both the Lessee and Lessor (dual agent).


 


Lessor’s
Agent


 


Brad
Schneider/Nick Krakower License No. 01887613/02100512 is (check one): ☒ the Lessor’s Agent
(salesperson or broker associate); or ☐ both the Lessee’s Agent and the Lessor’s Agent (dual agent).


 


Lessee’s
Brokerage Firm


 


_________________________  License
No. ___________________  Is the broker of (check one): ☐ the Lessee; or ☐ both the Lessee and Lessor (dual
agent).


 


Lessee’s
Agent


 


_________________________  License
No. _____________________ is (check one): ☐ the Lessee’s Agent (salesperson or broker associate); or
☐ both the Lessee’s Agent and the Lessor’s Agent (dual agent).


 










(b)
Payment to Brokers. Upon execution and delivery of this Lease by both Parties, Lessor shall pay to the Brokers the brokerage fee
agreed to in a separate written agreement (or if there is no such agreement, the sum of ________ or ______ % of the total Base
Rent) for the brokerage services rendered by the Brokers.


 


1.11 Guarantor. The
obligations of the Lessee under this Lease are to be guaranteed by ____________ (“Guarantor”). (See also
Paragraph 37)


 


 1.12 Attachments. Attached hereto are the following, all of which constitute a part of this Lease:


 


☒
an Addendum consisting of Paragraphs 50 through 53;




☐
a site plan depicting the Premises;


☐
a site plan depicting the Project;


☐
a current set of the Rules and Regulations for the Project;


☐
a current set of the Rules and Regulations adopted by the owners’ association;


☐
a Work Letter;


☒
other (specify): Arbitration Agreement (54) and Guaranty of Lease.


 



    	 	 	 
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 2. Premises.




 


2.1 Letting.
Lessor hereby leases to Lessee, and Lessee hereby leases from Lessor, the Premises, for the term, at the rental, and upon all of the
terms, covenants and conditions set forth in this Lease. While the approximate square footage of the Premises may have been used in
the marketing of the Premises for purposes of comparison, the Base Rent stated herein is NOT tied to square footage and is not
subject to adjustment should the actual size be determined to be different. NOTE: Lessee is advised to verify the actual
size prior to executing this Lease.


 











2.2
Condition. Lessor shall deliver that portion of the Premises contained within the Building (“Unit”) to Lessee
broom clean and free of debris on the Commencement Date or the Early Possession Date, whichever first occurs (“Start Date”),
and, so long as the required service contracts described in Paragraph 7.1(b) below are obtained by Lessee and in effect within thirty
days following the Start Date, warrants that the existing electrical, plumbing, fire sprinkler, lighting, heating, ventilating and
air conditioning systems (“HVAC”), loading doors, sump pumps, if any, and all other such elements in the Unit, other
than those constructed by Lessee, shall be in good operating condition on said date, that the structural elements of the roof, bearing
walls and foundation of the Unit shall be free of material defects, and that the Unit does not contain hazardous levels of any mold or
fungi defined as toxic under applicable state or federal law. If a non-compliance with such warranty exists as of the Start Date,
or if one of such systems or elements should malfunction or fail within the appropriate warranty period, Lessor shall, as Lessor’s
sole obligation with respect to such matter, except as otherwise provided in this Lease, promptly after receipt of written notice from
Lessee setting forth with specificity the nature and extent of such non-compliance, malfunction or failure, rectify same at Lessor’s
expense. The warranty periods shall be as follows: (i) 6 months as to the HVAC systems, and (ii) 30 days as to the remaining systems
and other elements of the Unit. If Lessee does not give Lessor the required notice within the appropriate warranty period, correction
of any such non-compliance, malfunction or failure shall be the obligation of Lessee at Lessee’s sole cost and expense (except
for the repairs to the fire sprinkler systems, roof, foundations, and/or bearing walls - see Paragraph 7). Lessor also warrants,
that unless otherwise specified in writing, Lessor is unaware of (i) any recorded Notices of Default affecting the Premise;
(ii) any delinquent amounts due under any loan secured by the Premises; and (iii) any bankruptcy proceeding affecting the Premises.


 


 2.3 Compliance. Lessor warrants that to the best of its knowledge the improvements on the Premises and the Common Areas comply with the building codes, applicable laws, covenants or restrictions of record, regulations, and ordinances (“Applicable Requirements”) that were in effect at the time that each improvement, or portion thereof, was constructed. Said warranty does not apply to the use to which Lessee will put the Premises, modifications which may be required by the Americans with Disabilities Act or any similar laws as a result of Lessee’s use (see Paragraph 49), or to any Alterations or Utility Installations (as defined in Paragraph 7.3(a)) made or to be made by Lessee. NOTE: Lessee is responsible for determining whether or not the Applicable Requirements, and especially the zoning are appropriate for Lessee’s intended use, and acknowledges that past uses of the Premises may no longer be allowed. If the Premises do not comply with said warranty, Lessor shall, except as otherwise provided, promptly after receipt of written notice from Lessee setting forth with specificity the nature and extent of such non-compliance, rectify the same at Lessor’s expense. If Lessee does not give Lessor written notice of a non-compliance with this warranty within 6 months following the Start Date, correction of that non-compliance shall be the obligation of Lessee at Lessee’s sole cost and expense. If the Applicable Requirements are hereafter changed so as to require during the term of this Lease the construction of an addition to or an alteration of the Unit, Premises and/or Building, the remediation of any Hazardous Substance, or the reinforcement or other physical modification of the Unit, Premises and/or Building (“Capital Expenditure”), Lessor and Lessee shall allocate the cost of such work as follows:




 


(a) Subject to Paragraph 2.3(c) below, if such Capital Expenditures are required as a result of the specific and unique use of the Premises
by Lessee as compared with uses by tenants in general, Lessee shall be fully responsible for the cost thereof, provided, however, that
if such Capital Expenditure is required during the last 2 years of this Lease and the cost thereof exceeds 6 months’ Base Rent,
Lessee may instead terminate this Lease unless Lessor notifies Lessee, in writing, within 10 days after receipt of Lessee’s
termination notice that Lessor has elected to pay the difference between the actual cost thereof and the amount equal to 6 months’
Base Rent. If Lessee elects termination, Lessee shall immediately cease the use of the Premises which requires such Capital Expenditure
and deliver to Lessor written notice specifying a termination date at least 90 days thereafter. Such termination date shall, however,
in no event be earlier than the last day that Lessee could legally utilize the Premises without commencing such Capital Expenditure.


 


(b)
If such Capital Expenditure is not the result of the specific and unique use of the Premises by Lessee (such as, governmentally
mandated seismic modifications), then Lessor shall pay for such Capital Expenditure and Lessee shall only be obligated to pay, each
month during the remainder of the term of this Lease or any extension thereof, on the date that on which the Base Rent is due, an amount
equal to 1/144th of the portion of such costs reasonably attributable to the Premises. Lessee shall pay Interest on the balance but may
prepay its obligation at any time. If, however, such Capital Expenditure is required during the last 2 years of this Lease or if Lessor
reasonably determines that it is not economically feasible to pay its share thereof, Lessor shall have the option to terminate this Lease
upon 90 days prior written notice to Lessee unless Lessee notifies Lessor, in writing, within 10 days after receipt of Lessor’s
termination notice that Lessee will pay for such Capital Expenditure. If Lessor does not elect to terminate, and fails to tender its
share of any such Capital Expenditure, Lessee may advance such funds and deduct same, with Interest, from Rent until Lessor’s share
of such costs have been fully paid. If Lessee is unable to finance Lessor’s share, or if the balance of the Rent due and payable
for the remainder of this Lease is not sufficient to fully reimburse Lessee on an offset basis, Lessee shall have the right
to terminate this Lease upon 30 days written notice to Lessor.


 



    	 	 	 
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(c)
Notwithstanding the above, the provisions concerning Capital Expenditures are intended to apply only to non-voluntary, unexpected, and
new Applicable Requirements. If the Capital Expenditures are instead triggered by Lessee as a result of an actual or proposed change
in use, change in intensity of use, or modification to the Premises then, and in that event, Lessee shall either: (i) immediately
cease such changed use or intensity of use and/or take such other steps as may be necessary to eliminate the requirement for such Capital
Expenditure, or (ii) complete such Capital Expenditure at its own expense. Lessee shall not have any right to terminate this Lease.


 


2.4
Acknowledgements. Lessee acknowledges that: (a) it has been given an opportunity to inspect and measure the Premises; (b) it has
been advised by Lessor and/or Brokers to satisfy itself with respect to the size and condition of the Premises (including but not limited
to the electrical, HVAC and fire sprinkler systems, security, environmental aspects, and compliance with Applicable Requirements
and the Americans with Disabilities Act), and their suitability for Lessee’s intended use; (c) Lessee has made such investigation
as it deems necessary with reference to such matters and assumes all responsibility therefor as the same relate to its occupancy of the
Premises; (d) it is not relying on any representation as to the size of the Premises made by Brokers or Lessor; (e) the square footage
of the Premises was not material to Lessee’s decision to lease the Premises and pay the Rent stated herein; and (f) neither Lessor,
Lessor’s agents, nor Brokers have made any oral or written representations or warranties with respect to said matters other than
as set forth in this Lease. In addition, Lessor acknowledges that: (i) Brokers have made no representations, promises or warranties concerning
Lessee’s ability to honor the Lease or suitability to occupy the Premises, and (ii) it is Lessor’s sole responsibility to
investigate the financial capability and/or suitability of all proposed tenants.


 








2.5 Lessee as Prior Owner/Occupant. The warranties made by Lessor in Paragraph 2 shall be of no force or effect if immediately
prior to the Start Date Lessee was the owner or occupant of the Premises. In such event, Lessee shall be responsible for any necessary
corrective work.


 


2.6
Vehicle Parking. Lessee shall be entitled to use the number of Parking Spaces specified in Paragraph 1.2(b) on those portions
of the Common Areas designated from time to time by Lessor for parking. Lessee shall not use more parking spaces than said number. Said
parking spaces shall be used for parking by vehicles no larger than full-size passenger automobiles or pick-up trucks, herein called
“Permitted Size Vehicles.” Lessor may regulate the loading and unloading of vehicles by adopting Rules and Regulations
as provided in Paragraph 2.9. No vehicles other than Permitted Size Vehicles may be parked in the Common Area without the prior written
permission of Lessor. In addition:


 


 (a) Lessee shall not permit or allow any vehicles that belong to or are controlled by Lessee or Lessee’s employees, suppliers, shippers, customers, contractors or invitees to be loaded, unloaded, or parked in areas other than those designated by Lessor for such activities.




 


 (b) Lessee shall not service or store any vehicles in the Common Areas.




 


(c)
If Lessee permits or allows any of the prohibited activities described in this Paragraph 2.6, then Lessor shall have the right, without
notice, in addition to such other rights and remedies that it may have, to remove or tow away the vehicle involved and charge the cost
to Lessee, which cost shall be immediately payable upon demand by Lessor.


 


2.7 Common
Areas - Definition. The term “Common Areas” is defined as all areas and facilities outside the
Premises and within the exterior boundary line of the Project and interior utility raceways and installations within the Unit
that are provided and designated by the Lessor from time to time for the general non-exclusive use of Lessor, Lessee and other
tenants of the Project and their respective employees, suppliers, shippers, customers, contractors and invitees, including parking
areas, loading and unloading areas, trash areas, roofs, roadways, walkways, driveways and landscaped areas.


  








2.8 Common
Areas - Lessee’s Rights. Lessor grants to Lessee, for the benefit of Lessee and its employees, suppliers, shippers,
contractors, customers and invitees, during the term of this Lease, the non-exclusive right to use, in common with others
entitled to such use, the Common Areas as they exist from time to time, subject to any rights, powers, and privileges reserved by
Lessor under the terms hereof or under the terms of any rules and regulations or restrictions governing the use of the Project.
Under no circumstances shall the right herein granted to use the Common Areas be deemed to include the right to store any property,
temporarily or permanently, in the Common Areas. Any such storage shall be permitted only by the prior written consent of Lessor or
Lessor’s designated agent, which consent may be revoked at any time. In the event that any unauthorized storage shall occur,
then Lessor shall have the right, without notice, in addition to such other rights and remedies that it may have, to remove the
property and charge the cost to Lessee, which cost shall be immediately payable upon demand by Lessor.


 


 2.9 Common Areas - Rules and Regulations. Lessor or such other person(s) as Lessor may appoint shall have the exclusive control and management of the Common Areas and shall have the right, from time to time, to establish, modify, amend and enforce reasonable rules and regulations (“Rules and Regulations”) for the management, safety, care, and cleanliness of the grounds, the parking and unloading of vehicles and the preservation of good order, as well as for the convenience of other occupants or tenants of the Building and the Project and their invitees. Lessee agrees to abide by and conform to all such Rules and Regulations, and shall use its best efforts to cause its employees, suppliers, shippers, customers, contractors and invitees to so abide and conform. Lessor shall not be responsible to Lessee for the non-compliance with said Rules and Regulations by other tenants of the Project.




 



    	 	 	 
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 2.10 Common Areas - Changes. Lessor shall have the right, in Lessor’s sole discretion, from time to time:




 


(a) To make changes to the Common Areas, including, without limitation, changes in the location, size, shape and number of driveways, entrances,
parking spaces, parking areas, loading and unloading areas, ingress, egress, direction of traffic, landscaped areas, walkways and
utility raceways; 


 


 (b) To
close temporarily any of the Common Areas for maintenance purposes so long as reasonable access to the Premises remains
available;




 


 (c) To designate other land outside the boundaries of the Project to be a part of the Common Areas;




 


 (d) To add additional buildings and improvements to the Common Areas;




 


 (e) To use the Common Areas while engaged in making additional improvements, repairs or alterations to the Project, or any portion thereof; and




 


(f)
To do and perform such other acts and make such other changes in, to or with respect to the Common Areas and Project as Lessor may,
in the exercise of sound business judgment, deem to be appropriate.


 


3.
Term.




 


 3.1 Term. The Commencement Date, Expiration Date and Original Term of this Lease are as specified in Paragraph 1.3.




 


3.2 Early Possession. Any provision herein granting Lessee Early Possession of the Premises is subject to and conditioned upon the
Premises being available for such possession prior to the Commencement Date. Any grant of Early Possession only conveys a non-exclusive
right to occupy the Premises. If Lessee totally or partially occupies the Premises prior to the Commencement Date, the obligation to
pay Base Rent shall be abated for the period of such Early Possession. All other terms of this Lease (including but not limited to the
obligations to pay Lessee’s Share of Common Area Operating Expenses, Real Property Taxes and insurance premiums and to maintain
the Premises) shall be in effect during such period. Any such Early Possession shall not affect the Expiration Date.


 


3.3
Delay In Possession. Lessor agrees to use commercially reasonable efforts to deliver exclusive possession of the Premises
to Lessee by the Commencement Date. If, despite said efforts, Lessor is unable to deliver possession by such date, Lessor shall
not be subject to any liability therefor, nor shall such failure affect the validity of this Lease or change the Expiration Date.
Lessee shall not, however, be obligated to pay Rent or perform its other obligations until Lessor delivers possession of the Premises
and any period of rent abatement that Lessee would otherwise have enjoyed shall run from the date of delivery of possession and continue
for a period equal to what Lessee would otherwise have enjoyed under the terms hereof, but minus any days of delay caused by the acts
or omissions of Lessee. If possession is not delivered within 60 days after the Commencement Date, as the same may be extended under
the terms of any Work Letter executed by Parties, Lessee may, at its option, by notice in writing within 10 days after the end of such
60 day period, cancel this Lease, in which event the Parties shall be discharged from all obligations hereunder. If such written notice
is not received by Lessor within said 10 day period, Lessee’s right to cancel shall terminate. If possession of the Premises is
not delivered within 120 days after the Commencement Date, this Lease shall terminate unless other agreements are reached between Lessor
and Lessee, in writing.


 


3.4 Lessee Compliance. Lessor shall not be required to tender possession of the Premises to Lessee until Lessee complies with its
obligation to provide evidence of insurance (Paragraph 8.5). Pending delivery of such evidence, Lessee shall be required to perform all
of its obligations under this Lease from and after the Start Date, including the payment of Rent, notwithstanding Lessor’s election
to withhold possession pending receipt of such evidence of insurance. Further, if Lessee is required to perform any other conditions
prior to or concurrent with the Start Date, the Start Date shall occur but Lessor may elect to withhold possession until such conditions
are satisfied.


 






    	 	 	 
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4.
Rent.




 


4.1.
Rent Defined. All monetary obligations of Lessee to Lessor under the terms of this Lease (except for the Security Deposit)
are deemed to be rent (“Rent”).


 


 4.2 Common Area Operating Expenses. Lessee shall pay to Lessor during the term hereof, in addition to the Base Rent, Lessee’s Share (as specified in Paragraph 1.6) of all Common Area Operating Expenses, as hereinafter defined, during each calendar year of the term of this Lease, in accordance with the following provisions:




 


 (a) The following costs relating to the ownership and operation of the Project are defined as “Common Area Operating Expenses”:




 


(i)
Costs relating to the operation, repair and maintenance, in neat, clean, good order and condition, but not the replacement (see
subparagraph (e)), of the following:


 


(aa)
The Common Areas and Common Area improvements, including parking areas, loading and unloading areas, trash areas, roadways, parkways,
walkways, driveways, landscaped areas, bumpers, irrigation systems, Common Area lighting facilities, fences and gates, elevators, roofs,
exterior walls of the buildings, building systems and roof drainage systems.


 


(bb)
Exterior signs and any tenant directories.


 


(cc)
Any fire sprinkler systems.


 


(dd)
All other areas and improvements that are within the exterior boundaries of the Project but outside of the Premises and/or any other
space occupied by a tenant.


 


 (ii) The cost of water, gas, electricity and telephone to service the Common Areas and any utilities not separately metered.




 


(iii) The cost of trash disposal, pest control services, property management, security services, owners’ association dues and fees, the
cost to repaint the exterior of any structures and the cost of any environmental inspections.


 


 (iv) Reserves set aside for maintenance and repair of Common Areas and Common Area equipment.




 


 (v) Any increase above the Base Real Property Taxes (as defined in Paragraph 10).




 


 (vi) Any “Insurance Cost Increase” (as defined in Paragraph 8).




 


 (vii) Any deductible portion of an insured loss concerning the Building or the Common Areas.




 


 (viii) Auditors’, accountants’ and attorneys’ fees and costs related to the operation, maintenance, repair and replacement of the Project.




 








(ix)
The cost of any capital improvement to the Building or the Project not covered under the provisions of Paragraph 2.3 provided; however,
that Lessor shall allocate the cost of any such capital improvement over a 12 year period and Lessee shall not be required to pay more
than Lessee’s Share of 1/144th of the cost of such capital improvement in any given month. Lessee shall pay Interest on the unamortized
balance but may prepay its obligation at any time.


 


 (x) The cost of any other services to be provided by Lessor that are stated elsewhere in this Lease to be a Common Area Operating Expense.




 


 (b) Any Common Area Operating Expenses and Real Property Taxes that are specifically attributable to the Unit, the Building or to any other building in the Project or to the operation, repair and maintenance thereof, shall be allocated entirely to such Unit, Building, or other building. However, any Common Area Operating Expenses and Real Property Taxes that are not specifically attributable to the Building or to any other building or to the operation, repair and maintenance thereof, shall be equitably allocated by Lessor to all buildings in the Project.




 


(c)
The inclusion of the improvements, facilities and services set forth in Subparagraph 4.2(a) shall not be deemed to impose an obligation
upon Lessor to either have said improvements or facilities or to provide those services unless the Project already has the same, Lessor
already provides the services, or Lessor has agreed elsewhere in this Lease to provide the same or some of them.


 



    	 	 	 
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 (d) Lessee’s Share of Common Area Operating Expenses is payable monthly on the same day as the Base Rent is due hereunder. The amount of such payments shall be based on Lessor’s estimate of the annual Common Area Operating Expenses. Within 60 days after written request (but not more than once each year) Lessor shall deliver to Lessee a reasonably detailed statement showing Lessee’s Share of the actual Common Area Operating Expenses for the preceding year. If Lessee’s payments during such year exceed Lessee’s Share, Lessor shall credit the amount of such over-payment against Lessee’s future payments. If Lessee’s payments during such year were less than Lessee’s Share, Lessee shall pay to Lessor the amount of the deficiency within 10 days after delivery by Lessor to Lessee of the statement.




 


(e)
Common Area Operating Expenses shall not include the cost of replacing equipment or capital components such as the roof, foundations,
exterior walls or Common Area capital improvements, such as the parking lot paving, elevators, fences that have a useful life for accounting
purposes of 5 years or more.


 


 (f) Common Area Operating Expenses shall not include any expenses paid by any tenant directly to third parties, or as to which Lessor is otherwise reimbursed by any third party, other tenant, or insurance proceeds.




 


4.3
Payment. Lessee shall cause payment of Rent to be received by Lessor in lawful money of the United States, without offset
or deduction (except as specifically permitted in this Lease), on or before the day on which it is due. All monetary amounts shall
be rounded to the nearest whole dollar. In the event that any statement or invoice prepared by Lessor is inaccurate such inaccuracy shall
not constitute a waiver and Lessee shall be obligated to pay the amount set forth in this Lease. Rent for any period during the term
hereof which is for less than one full calendar month shall be prorated based upon the actual number of days of said month. Payment of
Rent shall be made to Lessor at its address stated herein or to such other persons or place as Lessor may from time to time designate
in writing. Acceptance of a payment which is less than the amount then due shall not be a waiver of Lessor’s rights to the balance
of such Rent, regardless of Lessor’s endorsement of any check so stating. In the event that any check, draft, or other instrument
of payment given by Lessee to Lessor is dishonored for any reason, Lessee agrees to pay to Lessor the sum of $25 in addition to any Late
Charge and Lessor, at its option, may require all future Rent be paid by cashier’s check. Payments will be applied first to
accrued late charges and attorney’s fees, second to accrued interest, then to Base Rent and Common Area Operating Expenses, and
any remaining amount to any other outstanding charges or costs.


 


5.
Security Deposit. Lessee shall deposit with Lessor upon execution hereof the Security Deposit as security for Lessee’s faithful
performance of its obligations under this Lease. If Lessee fails to pay Rent, or otherwise Defaults under this Lease, Lessor may use,
apply or retain all or any portion of said Security Deposit for the payment of any amount already due Lessor, for Rents which will be
due in the future, and/ or to reimburse or compensate Lessor for any liability, expense, loss or damage which Lessor may suffer
or incur by reason thereof. If Lessor uses or applies all or any portion of the Security Deposit, Lessee shall within 10 days after written
request therefor deposit monies with Lessor sufficient to restore said Security Deposit to the full amount required by this Lease.
If the Base Rent increases during the term of this Lease, Lessee shall, upon written request from Lessor, deposit additional monies with
Lessor so that the total amount of the Security Deposit shall at all times bear the same proportion to the increased Base Rent as the
initial Security Deposit bore to the initial Base Rent. Should the Agreed Use be amended to accommodate a material change in the business
of Lessee or to accommodate a sublessee or assignee, Lessor shall have the right to increase the Security Deposit to the extent necessary,
in Lessor’s reasonable judgment, to account for any increased wear and tear that the Premises may suffer as a result thereof.
If a change in control of Lessee occurs during this Lease and following such change the financial condition of Lessee is, in Lessor’s
reasonable judgment, significantly reduced, Lessee shall deposit such additional monies with Lessor as shall be sufficient
to cause the Security Deposit to be at a commercially reasonable level based on such change in financial condition. Lessor shall
not be required to keep the Security Deposit separate from its general accounts. Within 90 days after the expiration or termination of
this Lease, Lessor shall return that portion of the Security Deposit not used or applied by Lessor. Lessor shall upon written request
provide Lessee with an accounting showing how that portion of the Security Deposit that was not returned was applied. No part of the
Security Deposit shall be considered to be held in trust, to bear interest or to be prepayment for any monies to be paid by Lessee under
this Lease. THE SECURITY DEPOSIT SHALL NOT BE USED BY LESSEE IN LIEU OF PAYMENT OF THE LAST MONTH’S RENT.


 


6.
Use.




 


6.1 Use. Lessee shall use and occupy the Premises only for the Agreed Use, or any other legal use which is reasonably comparable thereto,
and for no other purpose. Lessee shall not use or permit the use of the Premises in a manner that is unlawful, creates damage, waste
or a nuisance, or that disturbs occupants of or causes damage to neighboring premises or properties. Other than guide, signal and seeing
eye dogs, Lessee shall not keep or allow in the Premises any pets, animals, birds, fish, or reptiles. Lessor shall not unreasonably
withhold or delay its consent to any written request for a modification of the Agreed Use, so long as the same will not impair the
structural integrity of the Building or the mechanical or electrical systems therein, and/or is not significantly more burdensome
to the Project. If Lessor elects to withhold consent, Lessor shall within 7 days after such request give written notification of
same, which notice shall include an explanation of Lessor’s objections to the change in the Agreed Use.


 



    	 	 	 
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6.2
Hazardous Substances.




 


(a)
Reportable Uses Require Consent. The term “Hazardous Substance” as used in this Lease shall mean any product,
substance, or waste whose presence, use, manufacture, disposal, transportation, or release, either by itself or in combination with other
materials expected to be on the Premises, is either: (i) potentially injurious to the public health, safety or welfare, the environment
or the Premises; (ii) regulated or monitored by any governmental authority, or (iii) a basis for potential liability of Lessor to any
governmental agency or third party under any applicable statute or common law theory. Hazardous Substances shall include, but not be
limited to, hydrocarbons, petroleum, gasoline, and/or crude oil or any products, by-products or fractions thereof. Lessee shall not engage
in any activity in or on the Premises which constitutes a Reportable Use of Hazardous Substances without the express prior written consent
of Lessor and timely compliance (at Lessee’s expense) with all Applicable Requirements. “Reportable Use” shall
mean (i) the installation or use of any above or below ground storage tank; (ii) the generation, possession, storage, use, transportation,
or disposal of a Hazardous Substance that requires a permit from, or with respect to which a report, notice, registration or business
plan is required to be filed with, any governmental authority, and/or (iii) the presence at the Premises of a Hazardous Substance
with respect to which any Applicable Requirements requires that a notice be given to persons entering or occupying the Premises or neighboring
properties. Notwithstanding the foregoing, Lessee may use any ordinary and customary materials reasonably required to be used in the
normal course of the Agreed Use, ordinary office supplies (copier toner, liquid paper, glue, etc.) and common household cleaning
materials, so long as such use is in compliance with all Applicable Requirements, is not a Reportable Use, and does not expose the Premises
or neighboring property to any meaningful risk of contamination or damage or expose Lessor to any liability therefor. In addition, Lessor
may condition its consent to any Reportable Use upon receiving such additional assurances as Lessor reasonably deems necessary to protect
itself, the public, the Premises and/or the environment against damage, contamination, injury and/or liability, including, but not limited
to, the installation (and removal on or before Lease expiration or termination) of protective modifications (such as concrete encasements)
and/or increasing the Security Deposit.


 








(b) Duty to Inform Lessor. If Lessee knows, or has reasonable cause to believe, that a Hazardous Substance has come to be located
in, on, under or about the Premises, other than as previously consented to by Lessor, Lessee shall immediately give written notice of
such fact to Lessor, and provide Lessor with a copy of any report, notice, claim or other documentation which it has concerning the presence
of such Hazardous Substance.


 


(c)
Lessee Remediation. Lessee shall not cause or permit any Hazardous Substance to be spilled or released in, on, under, or about
the Premises (including through the plumbing or sanitary sewer system) and shall promptly, at Lessee’s expense, comply with all
Applicable Requirements and take all investigatory and/or remedial action reasonably recommended, whether or not formally ordered or
required, for the cleanup of any contamination of, and for the maintenance, security and/or monitoring of the Premises or neighboring
properties, that was caused or materially contributed to by Lessee, or pertaining to or involving any Hazardous Substance brought onto
the Premises during the term of this Lease, by or for Lessee, or any third party.


 


 (d) Lessee Indemnification. Lessee shall indemnify, defend and hold Lessor, its agents, employees, lenders and ground lessor, if any, harmless from and against any and all loss of rents and/or damages, liabilities, judgments, claims, expenses, penalties, and attorneys’ and consultants’ fees arising out of or involving any Hazardous Substance brought onto the Premises by or for Lessee, or any third party (provided, however, that Lessee shall have no liability under this Lease with respect to underground migration of any Hazardous Substance under the Premises from areas outside of the Project not caused or contributed to by Lessee). Lessee’s obligations shall include, but not be limited to, the effects of any contamination or injury to person, property or the environment created or suffered by Lessee, and the cost of investigation, removal, remediation, restoration and/or abatement, and shall survive the expiration or termination of this Lease. No termination, cancellation or release agreement entered into by Lessor and Lessee shall release Lessee from its obligations under this Lease with respect to Hazardous Substances, unless specifically so agreed by Lessor in writing at the time of such agreement.




 


(e)
Lessor Indemnification. Except as otherwise provided in paragraph 8.7, Lessor and its successors and assigns shall indemnify,
defend, reimburse and hold Lessee, its employees and lenders, harmless from and against any and all environmental damages, including
the cost of remediation, which are suffered as a direct result of Hazardous Substances on the Premises prior to Lessee taking possession
or which are caused by the gross negligence or willful misconduct of Lessor, its agents or employees. Lessor’s obligations, as
and when required by the Applicable Requirements, shall include, but not be limited to, the cost of investigation, removal, remediation,
restoration and/or abatement, and shall survive the expiration or termination of this Lease.


 


 (f) Investigations and Remediations. Lessor shall retain the responsibility and pay for any investigations or remediation measures required by governmental entities having jurisdiction with respect to the existence of Hazardous Substances on the Premises prior to the Lessee taking possession, unless such remediation measure is required as a result of Lessee’s use (including “Alterations”, as defined in paragraph 7.3(a) below) of the Premises, in which event Lessee shall be responsible for such payment. Lessee shall cooperate fully in any such activities at the request of Lessor, including allowing Lessor and Lessor’s agents to have reasonable access to the Premises at reasonable times in order to carry out Lessor’s investigative and remedial responsibilities.




 



    	 	 	 
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(g)
Lessor Termination Option. If a Hazardous Substance Condition (see Paragraph 9.1(e)) occurs during the term of this Lease, unless
Lessee is legally responsible therefor (in which case Lessee shall make the investigation and remediation thereof required by the Applicable
Requirements and this Lease shall continue in full force and effect, but subject to Lessor’s rights under Paragraph 6.2(d)
and Paragraph 13), Lessor may, at Lessor’s option, either (i) investigate and remediate such Hazardous Substance Condition, if
required, as soon as reasonably possible at Lessor’s expense, in which event this Lease shall continue in full force and effect,
or (ii) if the estimated cost to remediate such condition exceeds 12 times the then monthly Base Rent or $100,000, whichever is greater,
give written notice to Lessee, within 30 days after receipt by Lessor of knowledge of the occurrence of such Hazardous Substance Condition,
of Lessor’s desire to terminate this Lease as of the date 60 days following the date of such notice. In the event Lessor elects
to give a termination notice, Lessee may, within 10 days thereafter, give written notice to Lessor of Lessee’s commitment to pay
the amount by which the cost of the remediation of such Hazardous Substance Condition exceeds an amount equal to 12 times the then monthly
Base Rent or $100,000, whichever is greater. Lessee shall provide Lessor with said funds or satisfactory assurance thereof within 30
days following such commitment. In such event, this Lease shall continue in full force and effect, and Lessor shall proceed to make
such remediation as soon as reasonably possible after the required funds are available. If Lessee does not give such notice and provide
the required funds or assurance thereof within the time provided, this Lease shall terminate as of the date specified in Lessor’s
notice of termination.


 


6.3
Lessee’s Compliance with Applicable Requirements. Except as otherwise provided in this Lease, Lessee shall, at Lessee’s
sole expense, fully, diligently and in a timely manner, materially comply with all Applicable Requirements, the requirements of any applicable
fire insurance underwriter or rating bureau, and the recommendations of Lessor’s engineers and/or consultants which relate
in any manner to the Premises, without regard to whether said Applicable Requirements are now in effect or become effective
after the Start Date. Lessee shall, within 10 days after receipt of Lessor’s written request, provide Lessor with copies of all
permits and other documents, and other information evidencing Lessee’s compliance with any Applicable Requirements specified
by Lessor, and shall immediately upon receipt, notify Lessor in writing (with copies of any documents involved) of any threatened or
actual claim, notice, citation, warning, complaint or report pertaining to or involving the failure of Lessee or the Premises to comply
with any Applicable Requirements. Likewise, Lessee shall immediately give written notice to Lessor of: (i) any water damage to the Premises
and any suspected seepage, pooling, dampness or other condition conducive to the production of mold; or (ii) any mustiness or other odors
that might indicate the presence of mold in the Premises.


 


6.4
Inspection; Compliance. Lessor and Lessor’s “Lender” (as defined in Paragraph 30) and consultants
authorized by Lessor shall have the right to enter into Premises at any time in the case of an emergency, and otherwise at reasonable
times after reasonable notice, for the purpose of inspecting and/or testing the condition of the Premises and/or for verifying compliance
by Lessee with this Lease. The cost of any such inspections shall be paid by Lessor, unless a violation of Applicable Requirements, or
a Hazardous Substance Condition (see Paragraph 9.1(e)) is found to exist or be imminent, or the inspection is requested or ordered by
a governmental authority. In such case, Lessee shall upon request reimburse Lessor for the cost of such inspection, so long as such inspection
is reasonably related to the violation or contamination. In addition, Lessee shall provide copies of all relevant material safety data
sheets (MSDS) to Lessor within 10 days of the receipt of written request therefor. Lessee acknowledges that any failure on its
part to allow such inspections or testing will expose Lessor to risks and potentially cause Lessor to incur costs not contemplated by
this Lease, the extent of which will be extremely difficult to ascertain. Accordingly, should the Lessee fail to allow such inspections
and/or testing in a timely fashion the Base Rent shall be automatically increased, without any requirement for notice to Lessee, by an
amount equal to 10% of the then existing Base Rent or $100, whichever is greater for the remainder to the Lease. The Parties agree that
such increase in Base Rent represents fair and reasonable compensation for the additional risk/costs that Lessor will incur by reason
of Lessee’s failure to allow such inspection and/or testing. Such increase in Base Rent shall in no event constitute a waiver of
Lessee’s Default or Breach with respect to such failure nor prevent the exercise of any of the other rights and remedies granted
hereunder.


 


7.
Maintenance; Repairs; Utility Installations; Trade Fixtures and Alterations.




 


 7.1 Lessee’s Obligations.




 


(a)
In General. Subject to the provisions of Paragraph 2.2 (Condition), 2.3 (Compliance), 6.3 (Lessee’s Compliance with Applicable
Requirements), 7.2 (Lessor’s Obligations), 9 (Damage or Destruction), and 14 (Condemnation), Lessee shall, at Lessee’s sole
expense, keep the Premises, Utility Installations (intended for Lessee’s exclusive use, no matter where located), and Alterations
in good order, condition and repair (whether or not the portion of the Premises requiring repairs, or the means of repairing the same,
are reasonably or readily accessible to Lessee, and whether or not the need for such repairs occurs as a result of Lessee’s use,
any prior use, the elements or the age of such portion of the Premises), including, but not limited to, all equipment or facilities,
such as plumbing, HVAC equipment, electrical, lighting facilities, boilers, pressure vessels, fixtures, interior walls, interior
surfaces of exterior walls, ceilings, floors, windows, doors, plate glass, and skylights but excluding any items which are the responsibility
of Lessor pursuant to Paragraph 7.2. Lessee, in keeping the Premises in good order, condition and repair, shall exercise and perform
good maintenance practices, specifically including the procurement and maintenance of the service contracts required by Paragraph
7.1(b) below. Lessee’s obligations shall include restorations, replacements or renewals when necessary to keep the Premises and
all improvements thereon or a part thereof in good order, condition and state of repair.


 








 (b) Service Contracts. Lessee shall, at Lessee’s sole expense, procure and maintain contracts, with copies to Lessor, in customary form and substance for, and with contractors specializing and experienced in the maintenance of the following equipment and improvements, if any, if and when installed on the Premises: (i) HVAC equipment, (ii) boiler and pressure vessels, and (iii) clarifiers. However, Lessor reserves the right, upon notice to Lessee, to procure and maintain any or all of such service contracts, and Lessee shall reimburse Lessor, upon demand, for the cost thereof.




 



    	 	 	 
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(c)
Failure to Perform. If Lessee fails to perform Lessee’s obligations under this Paragraph 7.1, Lessor may enter upon the
Premises after 10 days’ prior written notice to Lessee (except in the case of an emergency, in which case no notice shall be required),
perform such obligations on Lessee’s behalf, and put the Premises in good order, condition and repair, and Lessee shall promptly
pay to Lessor a sum equal to 115% of the cost thereof.


 


(d)
Replacement. Subject to Lessee’s indemnification of Lessor as set forth in Paragraph 8.7 below, and without relieving
Lessee of liability resulting from Lessee’s failure to exercise and perform good maintenance practices, if an item described in
Paragraph 7.1(b) cannot be repaired other than at a cost which is in excess of 50% of the cost of replacing such item, then such item
shall be replaced by Lessor, and the cost thereof shall be prorated between the Parties and Lessee shall only be obligated to pay, each
month during the remainder of the term of this Lease or any extension thereof, on the date on which Base Rent is due, an amount equal
to the product of multiplying the cost of such replacement by a fraction, the numerator of which is one, and the denominator of which
is 144 (i.e. 1/144th of the cost per month). Lessee shall pay Interest on the unamortized balance but may prepay its obligation at any
time.


 


7.2 Lessor’s Obligations. Subject to the provisions of Paragraphs 2.2 (Condition), 2.3 (Compliance), 4.2 (Common Area Operating
Expenses), 6 (Use), 7.1 (Lessee’s Obligations), 9 (Damage or Destruction) and 14 (Condemnation), Lessor, subject to reimbursement
pursuant to Paragraph 4.2, shall keep in good order, condition and repair the foundations, exterior walls, structural condition of interior
bearing walls, exterior roof, fire sprinkler system, Common Area fire alarm and/or smoke detection systems, fire hydrants,
parking lots, walkways, parkways, driveways, landscaping, fences, signs and utility systems serving the Common Areas and all parts thereof,
as well as providing the services for which there is a Common Area Operating Expense pursuant to Paragraph 4.2. Lessor shall not be obligated
to paint the exterior or interior surfaces of exterior walls nor shall Lessor be obligated to maintain, repair or replace windows, doors
or plate glass of the Premises.


 


7.3
Utility Installations; Trade Fixtures; Alterations.




 


(a)
Definitions. The term “Utility Installations” refers to all floor and window coverings, air and/or
vacuum lines, power panels, electrical distribution, security and fire protection systems, communication cabling, lighting fixtures,
HVAC equipment, plumbing, and fencing in or on the Premises. The term “Trade Fixtures” shall mean Lessee’s machinery
and equipment that can be removed without doing material damage to the Premises. The term “Alterations” shall mean any modification
of the improvements, other than Utility Installations or Trade Fixtures, whether by addition or deletion. “Lessee Owned Alterations
and/or Utility Installations” are defined as Alterations and/or Utility Installations made by Lessee that are not yet
owned by Lessor pursuant to Paragraph 7.4(a).


 


(b) Consent. Lessee shall not make any Alterations or Utility Installations to the Premises without Lessor’s prior written consent.
Lessee may, however, make non-structural Alterations or Utility Installations to the interior of the Premises (excluding the roof) without
such consent but upon notice to Lessor, as long as they are not visible from the outside, do not involve puncturing, relocating or removing
the roof or any existing walls, will not affect the electrical, plumbing, HVAC, and/or life safety systems, do not trigger the requirement
for additional modifications and/or improvements to the Premises resulting from Applicable Requirements, such as compliance with
Title 24, and the cumulative cost thereof during this Lease as extended does not exceed a sum equal to 3 month’s Base Rent in the
aggregate or a sum equal to one month’s Base Rent in any one year. Notwithstanding the foregoing, Lessee shall not make or permit
any roof penetrations and/or install anything on the roof without the prior written approval of Lessor. Lessor may, as a precondition
to granting such approval, require Lessee to utilize a contractor chosen and/or approved by Lessor. Any Alterations or Utility Installations
that Lessee shall desire to make and which require the consent of the Lessor shall be presented to Lessor in written form with detailed
plans. Consent shall be deemed conditioned upon Lessee’s: (i) acquiring all applicable governmental permits, (ii) furnishing Lessor
with copies of both the permits and the plans and specifications prior to commencement of the work, and (iii) compliance with all
conditions of said permits and other Applicable Requirements in a prompt and expeditious manner. Any Alterations or Utility Installations
shall be performed in a workmanlike manner with good and sufficient materials. Lessee shall promptly upon completion furnish Lessor
with as-built plans and specifications. For work which costs an amount in excess of one month’s Base Rent, Lessor may condition
its consent upon Lessee providing a lien and completion bond in an amount equal to 150% of the estimated cost of such Alteration or Utility
Installation and/or upon Lessee’s posting an additional Security Deposit with Lessor.


 


(c)
Liens; Bonds. Lessee shall pay, when due, all claims for labor or materials furnished or alleged to have been furnished to or
for Lessee at or for use on the Premises, which claims are or may be secured by any mechanic’s or materialmen’s lien against
the Premises or any interest therein. Lessee shall give Lessor not less than 10 days notice prior to the commencement of any work in,
on or about the Premises, and Lessor shall have the right to post notices of non-responsibility. If Lessee shall contest the validity
of any such lien, claim or demand, then Lessee shall, at its sole expense defend and protect itself, Lessor and the Premises against
the same and shall pay and satisfy any such adverse judgment that may be rendered thereon before the enforcement thereof. If Lessor shall
require, Lessee shall furnish a surety bond in an amount equal to 150% of the amount of such contested lien, claim or demand, indemnifying
Lessor against liability for the same. If Lessor elects to participate in any such action, Lessee shall pay Lessor’s attorneys’
fees and costs.


 



    	 	 	 
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7.4
Ownership; Removal; Surrender; and Restoration.




 


(a)
Ownership. Subject to Lessor’s right to require removal or elect ownership as hereinafter provided, all Alterations and
Utility Installations made by Lessee shall be the property of Lessee, but considered a part of the Premises. Lessor may, at any time,
elect in writing to be the owner of all or any specified part of the Lessee Owned Alterations and Utility Installations. Unless
otherwise instructed per paragraph 7.4(b) hereof, all Lessee Owned Alterations and Utility Installations shall, at the expiration or
termination of this Lease, become the property of Lessor and be surrendered by Lessee with the Premises.


 


(b) Removal. By delivery to Lessee of written notice from Lessor not earlier than 90 and not later than 30 days prior to the end of
the term of this Lease, Lessor may require that any or all Lessee Owned Alterations or Utility Installations be removed by the expiration
or termination of this Lease. Lessor may require the removal at any time of all or any part of any Lessee Owned Alterations or Utility
Installations made without the required consent.


 


(c)
Surrender; Restoration. Lessee shall surrender the Premises by the Expiration Date or any earlier termination date, with all of
the improvements, parts and surfaces thereof broom clean and free of debris, and in good operating order, condition and state of repair,
ordinary wear and tear excepted. “Ordinary wear and tear” shall not include any damage or deterioration that would have been
prevented by good maintenance practice. Notwithstanding the foregoing and the provisions of Paragraph 7.1(a), if the Lessee occupies
the Premises for 12 months or less, then Lessee shall surrender the Premises in the same condition as delivered to Lessee on the Start
Date with NO allowance for ordinary wear and tear. Lessee shall repair any damage occasioned by the installation, maintenance or removal
of Trade Fixtures, Lessee owned Alterations and/or Utility Installations, furnishings, and equipment as well as the removal of any storage
tank installed by or for Lessee. Lessee shall also remove from the Premises any and all Hazardous Substances brought onto the Premises
by or for Lessee, or any third party (except Hazardous Substances which were deposited via underground migration from areas outside of
the Premises) to the level specified in Applicable Requirements. Trade Fixtures shall remain the property of Lessee and shall be
removed by Lessee. Any personal property of Lessee not removed on or before the Expiration Date or any earlier termination date shall
be deemed to have been abandoned by Lessee and may be disposed of or retained by Lessor as Lessor may desire. The failure by Lessee to
timely vacate the Premises pursuant to this Paragraph 7.4(c) without the express written consent of Lessor shall constitute a holdover
under the provisions of Paragraph 26 below.


 


8.
Insurance; Indemnity.




 


 8.1 Payment of Premium Increases.




 


(a)
As used herein, the term “Insurance Cost Increase” is defined as any increase in the actual cost of the insurance
applicable to the Building and/or the Project and required to be carried by Lessor, pursuant to Paragraphs 8.2(b), 8.3(a) and 8.3(b),
over and above the Base Premium, as hereinafter defined, calculated on an annual basis. Insurance Cost Increase shall include, but
not be limited to, requirements of the holder of a mortgage or deed of trust covering the Premises, Building and/or Project, increased
valuation of the Premises, Building and/or Project, and/or a general premium rate increase. The term Insurance Cost Increase shall not,
however, include any premium increases resulting from the nature of the occupancy of any other tenant of the Building. The “Base
Premium” shall be the annual premium applicable to the 12 month period immediately preceding the Start Date. If, however, the
Project was not insured for the entirety of such 12 month period, then the Base Premium shall be the lowest annual premium reasonably
obtainable for the Required Insurance as of the Start Date, assuming the most nominal use possible of the Building. In no event, however,
shall Lessee be responsible for any portion of the premium cost attributable to liability insurance coverage in excess of $2,000,000
procured under Paragraph 8.2(b).


 


(b) Lessee shall pay any Insurance Cost Increase to Lessor pursuant to Paragraph 4.2. Premiums for policy periods commencing prior to, or
extending beyond, the term of this Lease shall be prorated to coincide with the corresponding Start Date or Expiration Date.


 


8.2
Liability Insurance.




 


(a)
Carried by Lessee. Lessee shall obtain and keep in force a Commercial General Liability policy of insurance protecting Lessee
and Lessor as an additional insured against claims for bodily injury, personal injury and property damage based upon or arising out of
the ownership, use, occupancy or maintenance of the Premises and all areas appurtenant thereto. Such insurance shall be on an occurrence
basis providing single limit coverage in an amount not less than $1,000,000 per occurrence with an annual aggregate of not less than
$2,000,000. Lessee shall add Lessor as an additional insured by means of an endorsement at least as broad as the Insurance Service Organization’s
“Additional Insured-Managers or Lessors of Premises” Endorsement. The policy shall not contain any intra-insured exclusions
as between insured persons or organizations, but shall include coverage for liability assumed under this Lease as an “insured
contract” for the performance of Lessee’s indemnity obligations under this Lease. The limits of said insurance shall
not, however, limit the liability of Lessee nor relieve Lessee of any obligation hereunder. Lessee shall provide an endorsement on its
liability policy(ies) which provides that its insurance shall be primary to and not contributory with any similar insurance carried by
Lessor, whose insurance shall be considered excess insurance only.


 


(b)
Carried by Lessor. Lessor shall maintain liability insurance as described in Paragraph 8.2(a), in addition to, and not in lieu
of, the insurance required to be maintained by Lessee. Lessee shall not be named as an additional insured therein.


 



    	 	 	 
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8.3
Property Insurance - Building, Improvements and Rental
Value.




 


(a)
Building and Improvements. Lessor shall obtain and keep in force a policy or policies of insurance in the name of Lessor, with
loss payable to Lessor, any ground-lessor, and to any Lender insuring loss or damage to the Premises. The amount of such insurance shall
be equal to the full insurable replacement cost of the Premises, as the same shall exist from time to time, or the amount required by
any Lender, but in no event more than the commercially reasonable and available insurable value thereof. Lessee Owned Alterations and
Utility Installations, Trade Fixtures, and Lessee’s personal property shall be insured by Lessee not by Lessor. If the coverage
is available and commercially appropriate, such policy or policies shall insure against all risks of direct physical loss or damage (except
the perils of flood and/or earthquake unless required by a Lender), including coverage for debris removal and the enforcement of
any Applicable Requirements requiring the upgrading, demolition, reconstruction or replacement of any portion of the Premises as the
result of a covered loss. Said policy or policies shall also contain an agreed valuation provision in lieu of any coinsurance clause,
waiver of subrogation, and inflation guard protection causing an increase in the annual property insurance coverage amount by a
factor of not less than the adjusted U.S. Department of Labor Consumer Price Index for All Urban Consumers for the city nearest to where
the Premises are located. If such insurance coverage has a deductible clause, the deductible amount shall not exceed $5,000 per occurrence.


 


(b) Rental Value. Lessor shall also obtain and keep in force a policy or policies in the name of Lessor with loss payable to Lessor
and any Lender, insuring the loss of the full Rent for one year with an extended period of indemnity for an additional 180 days (“Rental
Value insurance”). Said insurance shall contain an agreed valuation provision in lieu of any coinsurance clause, and the amount
of coverage shall be adjusted annually to reflect the projected Rent otherwise payable by Lessee, for the next 12 month period.


 


(c)  
Adjacent Premises. Lessee shall pay for any increase in the premiums for the property insurance of the Building and for the Common
Areas or other buildings in the Project if said increase is caused by Lessee’s acts, omissions, use or occupancy of the Premises.


 


(d)
Lessee’s Improvements. Since Lessor is the Insuring Party, Lessor shall not be required to insure Lessee Owned Alterations
and Utility Installations unless the item in question has become the property of Lessor under the terms of this Lease.


 


8.4
Lessee’s Property; Business Interruption Insurance;
Worker’s Compensation Insurance.




 


(a)
Property Damage. Lessee shall obtain and maintain insurance coverage on all of Lessee’s personal property, Trade Fixtures,
and Lessee Owned Alterations and Utility Installations. Such insurance shall be full replacement cost coverage with a deductible of not
to exceed $1,000 per occurrence. The proceeds from any such insurance shall be used by Lessee for the replacement of personal property,
Trade Fixtures and Lessee Owned Alterations and Utility Installations.


 


(b) Business Interruption. Lessee shall obtain and maintain loss of income and extra expense insurance in amounts as will reimburse
Lessee for direct or indirect loss of earnings attributable to all perils commonly insured against by prudent lessees in the business
of Lessee or attributable to prevention of access to the Premises as a result of such perils.


 


 (c) Worker’s Compensation Insurance. Lessee shall obtain and maintain Worker’s Compensation Insurance in such amount as may be required by Applicable Requirements. Such policy shall include a ‘Waiver of Subrogation’ endorsement. Lessee shall provide Lessor with a copy of such endorsement along with the certificate of insurance or copy of the policy required by paragraph 8.5.




 


 (d) No Representation of Adequate Coverage. Lessor makes no representation that the limits or forms of coverage of insurance specified herein are adequate to cover Lessee’s property, business operations or obligations under this Lease.




 


8.5 Insurance Policies. Insurance required herein shall be by companies maintaining during the policy term a “General Policyholders
Rating” of at least A-, VII, as set forth in the most current issue of “Best’s Insurance Guide”, or such other
rating as may be required by a Lender. Lessee shall not do or permit to be done anything which invalidates the required insurance policies.
Lessee shall, prior to the Start Date, deliver to Lessor certified copies of policies of such insurance or certificates with
copies of the required endorsements evidencing the existence and amounts of the required insurance. No such policy shall be cancelable
or subject to modification except after 30 days prior written notice to Lessor. Lessee shall, at least 10 days prior to the expiration
of such policies, furnish Lessor with evidence of renewals or “insurance binders” evidencing renewal thereof, or Lessor may
increase his liability insurance coverage and charge the cost thereof to Lessee, which amount shall be payable by Lessee to Lessor upon
demand. Such policies shall be for a term of at least one year, or the length of the remaining term of this Lease, whichever is less.
If either Party shall fail to procure and maintain the insurance required to be carried by it, the other Party may, but shall not be
required to, procure and maintain the same.


 



    	 	 	 
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8.6 Waiver of Subrogation. Without affecting any other rights or remedies, Lessee and Lessor each hereby release and relieve
the other, and waive their entire right to recover damages against the other, for loss of or damage to its property arising out of or
incident to the perils required to be insured against herein. The effect of such releases and waivers is not limited by the amount
of insurance carried or required, or by any deductibles applicable hereto. The Parties agree to have their respective property damage
insurance carriers waive any right to subrogation that such companies may have against Lessor or Lessee, as the case may be, so long
as the insurance is not invalidated thereby.


 


8.7 Indemnity.
Except for Lessor’s gross negligence or willful misconduct, Lessee shall indemnify, protect, defend and hold harmless the
Premises, Lessor and its agents, Lessor’s master or ground lessor, partners and Lenders, from and against any and all claims,
loss of rents and/or damages, liens, judgments, penalties, attorneys’ and consultants’ fees, expenses and/or liabilities
arising out of, involving, or in connection with, a Breach of the Lease by Lessee and/or the use and/or occupancy of the Premises
and/or Project by Lessee and/or by Lessee’s employees, contractors or invitees. If any action or proceeding is brought against
Lessor by reason of any of the foregoing matters, Lessee shall upon notice defend the same at Lessee’s expense by counsel
reasonably satisfactory to Lessor and Lessor shall cooperate with Lessee in such defense. Lessor need not have  first paid any
such claim in order to be defended or indemnified.


 


8.8 Exemption
of Lessor and its Agents from Liability. Notwithstanding the negligence or breach of this Lease by Lessor or its agents, neither
Lessor nor its agents shall be liable under any circumstances for: (i) injury or damage to the person or goods, wares, merchandise or
other property of Lessee, Lessee’s employees, contractors, invitees, customers, or any other person in or about the Premises, whether
such damage or injury is caused by or results from fire, steam, electricity, gas, water or rain, indoor air quality, the presence
of mold or from the breakage, leakage, obstruction or other defects of pipes, fire sprinklers, wires, appliances, plumbing, HVAC
or lighting fixtures, or from any other cause, whether the said injury or damage results from conditions arising upon the Premises
or upon other portions of the Building, or from other sources or places; (ii) any damages arising from any act or neglect of any other
tenant of Lessor or from the failure of Lessor or its agents to enforce the provisions of any other lease in the Project; or (iii) injury
to Lessee’s business or for any loss of income or profit therefrom. Instead, it is intended that Lessee’s sole recourse
in the event of such damages or injury be to file a claim on the insurance policy(ies) that Lessee is required to maintain pursuant
to the provisions of paragraph 8.


 


8.9 Failure
to Provide Insurance. Lessee acknowledges that any failure on its part to obtain or maintain the insurance required herein will expose
Lessor to risks and potentially cause Lessor to incur costs not contemplated by this Lease, the extent of which will be extremely difficult
to ascertain. Accordingly, for any month or portion thereof that Lessee does not maintain the required insurance and/or does not provide
Lessor with the required binders or certificates evidencing the existence of the required insurance, the Base Rent shall be automatically
increased, without any requirement for notice to Lessee, by an amount equal to 10% of the then existing Base Rent or $100, whichever
is greater. The parties agree that such increase in Base Rent represents fair and reasonable compensation for the additional risk/costs
that Lessor will incur by reason of Lessee’s failure to maintain the required insurance. Such increase in Base Rent shall in no
event constitute a waiver of Lessee’s Default or Breach with respect to the failure to maintain such insurance, prevent the exercise
of any of the other rights and remedies granted hereunder, nor relieve Lessee of its obligation to maintain the insurance specified
in this Lease.


 


9.
Damage or Destruction.




 


 9.1 Definitions.




 


(a) “Premises
Partial Damage” shall mean damage or destruction to the improvements on the Premises, other than Lessee Owned Alterations and
Utility Installations, which can reasonably be repaired in 3 months or less from the date of the damage or destruction, and the cost
thereof does not exceed a sum equal to 6 month’s Base Rent. Lessor shall notify Lessee in writing within 30 days from the date
of the damage or destruction as to whether or not the damage is Partial or Total.


 


(b) “Premises
Total Destruction” shall mean damage or destruction to the improvements on the Premises, other than Lessee Owned Alterations
and Utility Installations and Trade Fixtures, which cannot reasonably be repaired in 3 months or less from the date of the damage or
destruction and/or the cost thereof exceeds a sum equal to 6 month’s Base Rent. Lessor shall notify Lessee in writing within 30
days from the date of the damage or destruction as to whether or not the damage is Partial or Total.


 


(c) “Insured
Loss” shall mean damage or destruction to improvements on the Premises, other than Lessee Owned Alterations and Utility Installations
and Trade Fixtures, which was caused by an event required to be covered by the insurance described in Paragraph 8.3(a), irrespective
of any deductible amounts or coverage limits involved.


 


(d)
“Replacement Cost” shall mean the cost to repair or rebuild the improvements owned by Lessor at the time of the
occurrence to their condition existing immediately prior thereto, including demolition, debris removal and upgrading required by the
operation of Applicable Requirements, and without deduction for depreciation.


 


(e)
“Hazardous Substance Condition” shall mean the occurrence or discovery of a condition involving the presence of, or
a contamination by, a Hazardous Substance, in, on, or under the Premises which requires restoration.


 




    	 	 	 
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9.2 Partial
Damage - Insured Loss. If a Premises Partial Damage that is an Insured Loss occurs, then Lessor shall, at Lessor’s expense,
repair such damage (but not Lessee’s Trade Fixtures or Lessee Owned Alterations and Utility Installations) as soon as reasonably
possible and this Lease shall continue in full force and effect; provided, however, that Lessee shall, at Lessor’s election,
make the repair of any damage or destruction the total cost to repair of which is $10,000 or less, and, in such event, Lessor shall make
any applicable insurance proceeds available to Lessee on a reasonable basis for that purpose. Notwithstanding the foregoing, if the required
insurance was not in force or the insurance proceeds are not sufficient to effect such repair, the Insuring Party shall promptly
contribute the shortage in proceeds as and when required to complete said repairs. In the event, however, such shortage was due to the
fact that, by reason of the unique nature of the improvements, full replacement cost insurance coverage was not commercially reasonable
and available, Lessor shall have no obligation to pay for the shortage in insurance proceeds or to fully restore the unique aspects of
the Premises unless Lessee provides Lessor with the funds to cover same, or adequate assurance thereof, within 10 days following receipt
of written notice of such shortage and request therefor. If Lessor receives said funds or adequate assurance thereof within said 10 day
period, the party responsible for making the repairs shall complete them as soon as reasonably possible and this Lease shall remain in
full force and effect. If such funds or assurance are not received, Lessor may nevertheless elect by written notice to Lessee within
10 days thereafter to: (i) make such restoration and repair as is commercially reasonable with Lessor paying any shortage in proceeds,
in which case this Lease shall remain in full force and effect, or (ii) have this Lease terminate 30 days thereafter. Lessee shall
not be entitled to reimbursement of any funds contributed by Lessee to repair any such damage or destruction. Premises Partial Damage
due to flood or earthquake shall be subject to Paragraph 9.3, notwithstanding that there may be some insurance coverage, but the
net proceeds of any such insurance shall be made available for the repairs if made by either Party.


 


9.3 Partial
Damage - Uninsured Loss. If a Premises Partial Damage that is not an Insured Loss occurs, unless caused by a negligent or willful
act of Lessee (in which event Lessee shall make the repairs at Lessee’s expense), Lessor may either: (i) repair such damage as
soon as reasonably possible at Lessor’s expense (subject to reimbursement pursuant to Paragraph 4.2), in which event this Lease
shall continue in full force and effect, or (ii) terminate this Lease by giving written notice to Lessee within 30 days after receipt
by Lessor of knowledge of the occurrence of such damage. Such termination shall be effective 60 days following the date of such
notice. In the event Lessor elects to terminate this Lease, Lessee shall have the right within 10 days after receipt of the termination
notice to give written notice to Lessor of Lessee’s commitment to pay for the repair of such damage without reimbursement from
Lessor. Lessee shall provide Lessor with said funds or satisfactory assurance thereof within 30 days after making such commitment. In
such event this Lease shall continue in full force and effect, and Lessor shall proceed to make such repairs as soon as reasonably
possible after the required funds are available. If Lessee does not make the required commitment, this Lease shall terminate as of the
date specified in the termination notice.


 


9.4 Total
Destruction. Notwithstanding any other provision hereof, if a Premises Total Destruction occurs, this Lease shall terminate 60 days
following such Destruction. If the damage or destruction was caused by the gross negligence or willful misconduct of Lessee, Lessor shall
have the right to recover Lessor’s damages from Lessee, except as provided in Paragraph 8.6.


 


9.5 Damage
Near End of Term. If at any time during the last 6 months of this Lease there is damage for which the cost to repair exceeds one
month’s Base Rent, whether or not an Insured Loss, Lessor may terminate this Lease effective 60 days following the date
of occurrence of such damage by giving a written termination notice to Lessee within 30 days after the date of occurrence of such
damage. Notwithstanding the foregoing, if Lessee at that time has an exercisable option to extend this Lease or to purchase the
Premises, then Lessee may preserve this Lease by (a) exercising such option and (b) providing Lessor with any shortage in insurance
proceeds (or adequate assurance thereof) needed to make the repairs on or before the earlier of (i) the date which is 10 days after
Lessee’s receipt of Lessor’s written notice purporting to terminate this Lease, or


 


(ii)
the day prior to the date upon which such option expires. If Lessee duly exercises such option during such period and provides Lessor
with funds (or adequate assurance thereof) to cover any shortage in insurance proceeds, Lessor shall, at Lessor’s commercially
reasonable expense, repair such damage as soon as reasonably possible and this Lease shall continue in full force and effect. If
Lessee fails to exercise such option and provide such funds or assurance during such period, then this Lease shall terminate on the date
specified in the termination notice and Lessee’s option shall be extinguished.


 




    	 	 	 
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9.6
Abatement of Rent; Lessee’s Remedies.




 


(a) Abatement.
In the event of Premises Partial Damage or Premises Total Destruction or a Hazardous Substance Condition for which Lessee is not responsible
under this Lease, the Rent payable by Lessee for the period required for the repair, remediation or restoration of such damage shall
be abated in proportion to the degree to which Lessee’s use of the Premises is impaired, but not to exceed the proceeds received
from the Rental Value insurance. All other obligations of Lessee hereunder shall be performed by Lessee, and Lessor shall have no liability
for any such damage, destruction, remediation, repair or restoration except as provided herein.


 


(b) Remedies.
If Lessor is obligated to repair or restore the Premises and does not commence, in a substantial and meaningful way, such repair or
restoration within 90 days after such obligation shall accrue, Lessee may, at any time prior to the commencement of such repair or
restoration, give written notice to Lessor and to any Lenders of which Lessee has actual notice, of Lessee’s election to
terminate this Lease on a date not less than 60 days following the giving of such notice. If Lessee gives such notice and such
repair or restoration is not commenced within 30 days thereafter, this Lease shall terminate as of the date specified in said
notice. If the repair or restoration is commenced within such 30 days, this Lease shall continue in full force and effect.
“Commence” shall mean either the unconditional authorization of the preparation of the required plans, or the beginning
of the actual work on the Premises, whichever first occurs.


 


9.7 Termination;
Advance Payments. Upon termination of this Lease pursuant to Paragraph 6.2(g) or Paragraph 9, an equitable adjustment shall be made
concerning advance Base Rent and any other advance payments made by Lessee to Lessor. Lessor shall, in addition, return to Lessee so
much of Lessee’s Security Deposit as has not been, or is not then required to be, used by Lessor.


 


10.
Real Property Taxes.




 


 10.1 Definitions.




 


(a) “Real
Property Taxes.” As used herein, the term “Real Property Taxes” shall include any form of assessment; real
estate, general, special, ordinary or extraordinary, or rental levy or tax (other than inheritance, personal income or estate taxes);
improvement bond; and/or license fee imposed upon or levied against any legal or equitable interest of Lessor in the Project, Lessor’s
right to other income therefrom, and/or Lessor’s business of leasing, by any authority having the direct or indirect power to tax
and where the funds are generated with reference to the Project address. The term “Real Property Taxes” shall also include
any tax, fee, levy, assessment or charge, or any increase therein: (i) imposed by reason of events occurring during the term of this
Lease, including but not limited to, a change in the ownership of the Project; (ii) a change in the improvements thereon; and/or (iii)
levied or assessed on machinery or equipment provided by Lessor to Lessee pursuant to this Lease.


 


(b) “Base
Real Property Taxes.” As used herein, the term “Base Real Property Taxes” shall be the amount of Real Property
Taxes, which are assessed against the Project, during the entire calendar year in which the Lease is executed.


 


10.2 Payment
of Taxes. Except as otherwise provided in Paragraph 10.3, Lessor shall pay the Real Property Taxes applicable to the Project,
and said payments shall be included in the calculation of Common Area Operating Expenses in accordance with the provisions of
Paragraph 4.2.


 


10.3 Additional
Improvements. Common Area Operating Expenses shall not include Real Property Taxes specified in the tax assessor’s records
and work sheets as being caused by additional improvements placed upon the Project by other tenants or by Lessor for the exclusive enjoyment
of such other Tenants. Notwithstanding Paragraph 10.2 hereof, Lessee shall, however, pay to Lessor at the time Common Area Operating
Expenses are payable under Paragraph 4.2, the entirety of any increase in Real Property Taxes if assessed solely by reason of Alterations,
Trade Fixtures or Utility Installations placed upon the Premises by Lessee or at Lessee’s request or by reason of any alterations
or improvements to the Premises made by Lessor subsequent to the execution of this Lease by the Parties.


 


10.4 Joint
Assessment. If the Building is not separately assessed, Real Property Taxes allocated to the Building shall be an equitable proportion
of the Real Property Taxes for all of the land and improvements included within the tax parcel assessed, such proportion to be determined
by Lessor from the respective valuations assigned in the assessor’s work sheets or such other information as may be reasonably
available. Lessor’s reasonable determination thereof, in good faith, shall be conclusive.


 


10.5 Personal
Property Taxes. Lessee shall pay prior to delinquency all taxes assessed against and levied upon Lessee Owned Alterations and Utility
Installations, Trade Fixtures, furnishings, equipment and all personal property of Lessee contained in the Premises. When possible, Lessee
shall cause its Lessee Owned Alterations and Utility Installations, Trade Fixtures, furnishings, equipment and all other personal property
to be assessed and billed separately from the real property of Lessor. If any of Lessee’s said property shall be assessed with
Lessor’s real property, Lessee shall pay Lessor the taxes attributable to Lessee’s property within 10 days after receipt
of a written statement setting forth the taxes applicable to Lessee’s property.


 




    	 	 	 
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11.
Utilities and Services.




 


11.1 Lessee
shall pay for all water, gas, heat, light, power, telephone, trash disposal and other utilities and services supplied to the Premises,
together with any taxes thereon. Notwithstanding the provisions of Paragraph 4.2, if at any time in Lessor’s sole judgment, Lessor
determines that Lessee is using a disproportionate amount of water, electricity or other commonly metered utilities, or that Lessee is
generating such a large volume of trash as to require an increase in the size of the trash receptacle and/or an increase in the number
of times per month that it is emptied, then Lessor may increase Lessee’s Base Rent by an amount equal to such increased costs.
There shall be no abatement of Rent and Lessor shall not be liable in any respect whatsoever for the inadequacy, stoppage, interruption
or discontinuance of any utility or service due to riot, strike, labor dispute, breakdown, accident, repair or other cause beyond Lessor’s
reasonable control or in cooperation with governmental request or directions.


 


11.2 Within
fifteen days of Lessor’s written request, Lessee agrees to deliver to Lessor such information, documents and/or authorization
as Lessor needs in order for Lessor to comply with new or existing Applicable Requirements relating to commercial building energy usage,
ratings, and/or the reporting thereof.


 


12.
Assignment and Subletting.




 


 12.1 Lessor’s Consent Required.




 


(a) Lessee
shall not voluntarily or by operation of law assign, transfer, mortgage or encumber (collectively, “assign or assignment”)
or sublet all or any part of Lessee’s interest in this Lease or in the Premises without Lessor’s prior written consent.


 


(b)  Unless
Lessee is a corporation and its stock is publicly traded on a national stock exchange, a change in the control of Lessee shall constitute
an assignment requiring consent. The transfer, on a cumulative basis, of 25% or more of the voting control of Lessee shall constitute
a change in control for this purpose.


 


(c) The
involvement of Lessee or its assets in any transaction, or series of transactions (by way of merger, sale, acquisition, financing,
transfer, leveraged buy-out or otherwise), whether or not a formal assignment or hypothecation of this Lease or Lessee’s assets
occurs, which results or will result in a reduction of the Net Worth of Lessee by an amount greater than 25% of such Net Worth as it
was represented at the time of the execution of this Lease or at the time of the most recent assignment to which Lessor has consented,
or as it exists immediately prior to said transaction or transactions constituting such reduction, whichever was or is greater, shall
be considered an assignment of this Lease to which Lessor may withhold its consent. “Net Worth of Lessee” shall mean
the net worth of Lessee (excluding any guarantors) established under generally accepted accounting principles.


 


 (d) An
assignment or subletting without consent shall, at Lessor’s option, be a Default curable after notice per Paragraph 13.1(d),
or a non-curable Breach without the necessity of any notice and grace period. If Lessor elects to treat such unapproved assignment
or subletting as a non-curable Breach, Lessor may either: (i) terminate this Lease, or (ii) upon 30 days written notice, increase
the monthly Base Rent to 110% of the Base Rent then in effect. Further, in the event of such Breach and rental adjustment, (i) the
purchase price of any option to purchase the Premises held by Lessee shall be subject to similar adjustment to 110% of the price
previously in effect, and (ii) all fixed and non- fixed rental adjustments scheduled during the remainder of the Lease term shall be
increased to 110% of the scheduled adjusted rent.




 




    	 	 	 
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 (e) Lessee’s remedy for any breach of Paragraph 12.1 by Lessor shall be limited to compensatory damages and/or injunctive relief.




 


(f) Lessor
may reasonably withhold consent to a proposed assignment or subletting if Lessee is in Default at the time consent is requested.


 


(g) Notwithstanding
the foregoing, allowing a de minimis portion of the Premises, ie. 20 square feet or less, to be used by a third party vendor in connection
with the installation of a vending machine or pay phone shall not constitute a subletting.


 


12.2
Terms and Conditions Applicable to Assignment and
Subletting.




 


(a) Regardless
of Lessor’s consent, no assignment or subletting shall: (i) be effective without the express written assumption by such assignee
or sublessee of the obligations of Lessee under this Lease, (ii) release Lessee of any obligations hereunder, or (iii) alter the primary
liability of Lessee for the payment of Rent or for the performance of any other obligations to be performed by Lessee.


 


(b)
Lessor may accept Rent or performance of Lessee’s obligations from any person other than Lessee pending approval or
disapproval of an assignment. Neither a delay in the approval or disapproval of such assignment nor the acceptance of Rent or
performance shall constitute a waiver or estoppel of Lessor’s right to exercise its remedies for Lessee’s Default or
Breach.


 


 (c) Lessor’s consent to any assignment or subletting shall not constitute a consent to any subsequent assignment or subletting.




 


(d) In
the event of any Default or Breach by Lessee, Lessor may proceed directly against Lessee, any Guarantors or anyone else responsible for
the performance of Lessee’s obligations under this Lease, including any assignee or sublessee, without first exhausting Lessor’s
remedies against any other person or entity responsible therefor to Lessor, or any security held by Lessor.


 


(e) Each
request for consent to an assignment or subletting shall be in writing, accompanied by information relevant to Lessor’s determination
as to the financial and operational responsibility and appropriateness of the proposed assignee or sublessee, including but not
limited to the intended use and/or required modification of the Premises, if any, together with a fee of $500 as consideration for
Lessor’s considering and processing said request. Lessee agrees to provide Lessor with such other or additional information and/or
documentation as may be reasonably requested. (See also Paragraph 36)


 


(f) Any
assignee of, or sublessee under, this Lease shall, by reason of accepting such assignment, entering into such sublease, or entering into
possession of the Premises or any portion thereof, be deemed to have assumed and agreed to conform and comply with each and every term,
covenant, condition and obligation herein to be observed or performed by Lessee during the term of said assignment or sublease, other
than such obligations as are contrary to or inconsistent with provisions of an assignment or sublease to which Lessor has specifically
consented to in writing.


 


(g) Lessor’s
consent to any assignment or subletting shall not transfer to the assignee or sublessee any Option granted to the original Lessee by
this Lease unless such transfer is specifically consented to by Lessor in writing. (See Paragraph 39.2)


 


12.3 Additional
Terms and Conditions Applicable to Subletting. The following terms and conditions shall apply to any subletting by Lessee of all
or any part of the Premises and shall be deemed included in all subleases under this Lease whether or not expressly incorporated therein:


 


(a)
Lessee hereby assigns and transfers to Lessor all of Lessee’s interest in all Rent payable on any sublease, and Lessor may
collect such Rent and apply same toward Lessee’s obligations under this Lease; provided, however, that until a Breach shall
occur in the performance of Lessee’s obligations, Lessee may collect said Rent. In the event that the amount collected by
Lessor exceeds Lessee’s then outstanding obligations any such excess shall be refunded to Lessee. Lessor shall not, by reason
of the foregoing or any assignment of such sublease, nor by reason of the collection of Rent, be deemed liable to the sublessee for
any failure of Lessee to perform and comply with any of Lessee’s obligations to such sublessee. Lessee hereby irrevocably
authorizes and directs any such sublessee, upon receipt of a written notice from Lessor stating that a Breach exists in the
performance of Lessee’s obligations under this Lease, to pay to Lessor all Rent due and to become due under the sublease.
Sublessee shall rely upon any such notice from Lessor and shall pay all Rents to Lessor without any obligation or right to inquire
as to whether such Breach exists, notwithstanding any claim from Lessee to the contrary.


 


(b) In
the event of a Breach by Lessee, Lessor may, at its option, require sublessee to attorn to Lessor, in which event Lessor shall undertake
the obligations of the sublessor under such sublease from the time of the exercise of said option to the expiration of such sublease;
provided, however, Lessor shall not be liable for any prepaid rents or security deposit paid by such sublessee to such sublessor or for
any prior Defaults or Breaches of such sublessor.


 


 (c) Any matter requiring the consent of the sublessor under a sublease shall also require the consent of Lessor.




 


 (d) No sublessee shall further assign or sublet all or any part of the Premises without Lessor’s prior written consent.




 


(e) Lessor
shall deliver a copy of any notice of Default or Breach by Lessee to the sublessee, who shall have the right to cure the Default of Lessee
within the grace period, if any, specified in such notice. The sublessee shall have a right of reimbursement and offset from
and against Lessee for any such Defaults cured by the sublessee.


 




    	 	 	 
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13.
Default; Breach; Remedies.




 


13.1 Default;
Breach. A “Default” is defined as a failure by the Lessee to comply with or perform any of the terms, covenants,
conditions or Rules and Regulations under this Lease. A “Breach” is defined as the occurrence of one or more
of the following Defaults, and the failure of Lessee to cure such Default within any applicable grace period:


 


(a) The
abandonment of the Premises; the vacating of the Premises prior to the expiration or termination of this Lease without providing a commercially
reasonable level of security, or where the coverage of the property insurance described in Paragraph 8.3 is jeopardized as a result thereof,
or without providing reasonable assurances to minimize potential vandalism; or failure to deliver to Lessor exclusive possession of the
entire Premises in accordance herewith prior to the expiration or termination of this Lease.


 


(b) The
failure of Lessee to make any payment of Rent or any Security Deposit required to be made by Lessee hereunder, whether to Lessor or to
a third party, when due, to provide reasonable evidence of insurance or surety bond, or to fulfill any obligation under this Lease
which endangers or threatens life or property, where such failure continues for a period of 3 business days following written notice
to Lessee. THE ACCEPTANCE BY LESSOR OF A PARTIAL PAYMENT OF RENT OR SECURITY DEPOSIT SHALL NOT CONSTITUTE A WAIVER OF ANY OF LESSOR’S
RIGHTS, INCLUDING LESSOR’S RIGHT TO RECOVER POSSESSION OF THE PREMISES.


 


(c)
The failure of Lessee to allow Lessor and/or its agents access to the Premises or the commission of waste, act or acts constituting
public or private nuisance, and/or an illegal activity on the Premises by Lessee, where such actions continue for a period of 3
business days following written notice to Lessee. In the event that Lessee commits waste, a nuisance or an illegal activity a second
time then, the Lessor may elect to treat such conduct as a non-curable Breach rather than a Default.


 


(d) The
failure by Lessee to provide (i) reasonable written evidence of compliance with Applicable Requirements, (ii) the service contracts,
(iii) the rescission of an unauthorized assignment or subletting, (iv) an Estoppel Certificate or financial statements, (v)
a requested subordination, (vi) evidence concerning any guaranty and/or Guarantor, (vii) any document requested under Paragraph 41, (viii)
material safety data sheets (MSDS), or (ix) any other documentation or information which Lessor may reasonably require of Lessee under
the terms of this Lease, where any such failure continues for a period of 10 days following written notice to Lessee.


 


(e) A
Default by Lessee as to the terms, covenants, conditions or provisions of this Lease, or of the rules adopted under Paragraph 2.9 hereof,
other than those described in subparagraphs 13.1(a), (b), (c) or (d), above, where such Default continues for a period of 30 days after
written notice; provided, however, that if the nature of Lessee’s Default is such that more than 30 days are reasonably required
for its cure, then it shall not be deemed to be a Breach if Lessee commences such cure within said 30 day period and thereafter diligently
prosecutes such cure to completion.


 




    	 	 	 
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(f)
The occurrence of any of the following events: (i) the making of any general arrangement or assignment for the benefit of creditors;


 


(ii)
becoming a “debtor” as defined in 11 U.S.C. § 101 or any successor statute thereto (unless, in the case
of a petition filed against Lessee, the same is dismissed within 60 days); (iii) the appointment of a trustee or receiver to take
possession of substantially all of Lessee’s assets located at the Premises or of Lessee’s interest in this Lease, where possession
is not restored to Lessee within 30 days; or (iv) the attachment, execution or other judicial seizure of substantially all of Lessee’s
assets located at the Premises or of Lessee’s interest in this Lease, where such seizure is not discharged within 30 days; provided,
however, in the event that any provision of this subparagraph is contrary to any applicable law, such provision shall be of no force
or effect, and not affect the validity of the remaining provisions.


 


 (g) The discovery that any financial statement of Lessee or of any Guarantor given to Lessor was materially false.




 


(h) If
the performance of Lessee’s obligations under this Lease is guaranteed: (i) the death of a Guarantor, (ii) the termination of a
Guarantor’s liability with respect to this Lease other than in accordance with the terms of such guaranty, (iii) a Guarantor’s
becoming insolvent or the subject of a bankruptcy filing, (iv) a Guarantor’s refusal to honor the guaranty, or (v) a Guarantor’s
breach of its guaranty obligation on an anticipatory basis, and Lessee’s failure, within 60 days following written notice of any
such event, to provide written alternative assurance or security, which, when coupled with the then existing resources of Lessee, equals
or exceeds the combined financial resources of Lessee and the Guarantors that existed at the time of execution of this Lease.


 


 13.2 Remedies. If Lessee fails to perform any of its affirmative duties or obligations, within 10 days after written notice (or in case of an emergency, without notice), Lessor may, at its option, perform such duty or obligation on Lessee’s behalf, including but not limited to the obtaining of reasonably required bonds, insurance policies, or governmental licenses, permits or approvals. Lessee shall pay to Lessor an amount equal to 115% of the costs and expenses incurred by Lessor in such performance upon receipt of an invoice therefor. In the event of a Breach, Lessor may, with or without further notice or demand, and without limiting Lessor in the exercise of any right or remedy which Lessor may have by reason of such Breach:




 


(a) Terminate
Lessee’s right to possession of the Premises by any lawful means, in which case this Lease shall terminate and Lessee shall immediately
surrender possession to Lessor. In such event Lessor shall be entitled to recover from Lessee: (i) the unpaid Rent which had been earned
at the time of termination; (ii) the worth at the time of award of the amount by which the unpaid rent which would have been earned after
termination until the time of award exceeds the amount of such rental loss that the Lessee proves could have been reasonably avoided;
(iii) the worth at the time of award of the amount by which the unpaid rent for the balance of the term after the time of award exceeds
the amount of such rental loss that the Lessee proves could be reasonably avoided; and (iv) any other amount necessary to compensate
Lessor for all the detriment proximately caused by the Lessee’s failure to perform its obligations under this Lease or which in
the ordinary course of things would be likely to result therefrom, including but not limited to the cost of recovering possession of
the Premises, expenses of reletting, including necessary renovation and alteration of the Premises, reasonable attorneys’ fees,
and that portion of any leasing commission paid by Lessor in connection with this Lease applicable to the unexpired term of this Lease.
The worth at the time of award of the amount referred to in provision (iii) of the immediately preceding sentence shall be computed by
discounting such amount at the discount rate of the Federal Reserve Bank of the District within which the Premises are located at the
time of award plus one percent. Efforts by Lessor to mitigate damages caused by Lessee’s Breach of this Lease shall not waive
Lessor’s right to recover any damages to which Lessor is otherwise entitled. If termination of this Lease is obtained through the
provisional remedy of unlawful detainer, Lessor shall have the right to recover in such proceeding any unpaid Rent and damages as are
recoverable therein, or Lessor may reserve the right to recover all or any part thereof in a separate suit. If a notice and grace period
required under Paragraph 13.1 was not previously given, a notice to pay rent or quit, or to perform or quit given to Lessee under the
unlawful detainer statute shall also constitute the notice required by Paragraph 13.1. In such case, the applicable grace period required
by Paragraph 13.1 and the unlawful detainer statute shall run concurrently, and the failure of Lessee to cure the Default within the
greater of the two such grace periods shall constitute both an unlawful detainer and a Breach of this Lease entitling Lessor to the remedies
provided for in this Lease and/or by said statute.


 


(b) Continue
the Lease and Lessee’s right to possession and recover the Rent as it becomes due, in which event Lessee may sublet or assign,
subject only to reasonable limitations. Acts of maintenance, efforts to relet, and/or the appointment of a receiver to protect the
Lessor’s interests, shall not constitute a termination of the Lessee’s right to possession.


 


(c) Pursue
any other remedy now or hereafter available under the laws or judicial decisions of the state wherein the Premises are located. The expiration
or termination of this Lease and/or the termination of Lessee’s right to possession shall not relieve Lessee from liability under
any indemnity provisions of this Lease as to matters occurring or accruing during the term hereof or by reason of Lessee’s occupancy
of the Premises.


 




    	 	 	 
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13.3 Inducement
Recapture. Any agreement for free or abated rent or other charges, the cost of tenant improvements for Lessee paid for or performed
by Lessor, or for the giving or paying by Lessor to or for Lessee of any cash or other bonus, inducement or consideration for Lessee’s
entering into this Lease, all of which concessions are hereinafter referred to as “Inducement Provisions,” shall be
deemed conditioned upon Lessee’s full and faithful performance of all of the terms, covenants and conditions of this Lease. Upon
Breach of this Lease by Lessee, any such Inducement Provision shall automatically be deemed deleted from this Lease and of no further
force or effect, and any rent, other charge, bonus, inducement or consideration theretofore abated, given or paid by Lessor under
such an Inducement Provision shall be immediately due and payable by Lessee to Lessor, notwithstanding any subsequent cure of said Breach
by Lessee. The acceptance by Lessor of rent or the cure of the Breach which initiated the operation of this paragraph shall not be deemed
a waiver by Lessor of the provisions of this paragraph unless specifically so stated in writing by Lessor at the time of such acceptance.


 


13.4 Late
Charges. Lessee hereby acknowledges that late payment by Lessee of Rent will cause Lessor to incur costs not contemplated by this
Lease, the exact amount of which will be extremely difficult to ascertain. Such costs include, but are not limited to, processing
and accounting charges, and late charges which may be imposed upon Lessor by any Lender. Accordingly, if any Rent shall not be received
by Lessor within 5 days after such amount shall be due, then, without any requirement for notice to Lessee, Lessee shall immediately
pay to Lessor a one-time late charge equal to 10% of each such overdue amount or $100, whichever is greater. The parties hereby agree
that such late charge represents a fair and reasonable estimate of the costs Lessor will incur by reason of such late payment. Acceptance
of such late charge by Lessor shall in no event constitute a waiver of Lessee’s Default or Breach with respect to such overdue
amount, nor prevent the exercise of any of the other rights and remedies granted hereunder. In the event that a late charge is payable
hereunder, whether or not collected, for 3 consecutive installments of Base Rent, then notwithstanding any provision of this Lease to
the contrary, Base Rent shall, at Lessor’s option, become due and payable quarterly in advance.


 


13.5 Interest.
Any monetary payment due Lessor hereunder, other than late charges, not received by Lessor, when due shall bear interest from the 31st
day after it was due. The interest (“Interest”) charged shall be computed at the rate of 10% per annum but shall not
exceed the maximum rate allowed by law. Interest is payable in addition to the potential late charge provided for in Paragraph 13.4.


 


13.6
Breach by Lessor.




 


(a) Notice
of Breach. Lessor shall not be deemed in breach of this Lease unless Lessor fails within a reasonable time to perform an obligation
required to be performed by Lessor. For purposes of this Paragraph, a reasonable time shall in no event be less than 30 days after receipt
by Lessor, and any Lender whose name and address shall have been furnished to Lessee in writing for such purpose, of written notice specifying
wherein such obligation of Lessor has not been performed; provided, however, that if the nature of Lessor’s obligation is such
that more than 30 days are reasonably required for its performance, then Lessor shall not be in breach if performance is commenced within
such 30 day period and thereafter diligently pursued to completion.


 


(b) Performance
by Lessee on Behalf of Lessor. In the event that neither Lessor nor Lender cures said breach within 30 days after receipt of said
notice, or if having commenced said cure they do not diligently pursue it to completion, then Lessee may elect to cure said breach at
Lessee’s expense and offset from Rent the actual and reasonable cost to perform such cure, provided however, that such offset
shall not exceed an amount equal to the greater of one month’s Base Rent or the Security Deposit, reserving Lessee’s right
to reimbursement from Lessor for any such expense in excess of such offset. Lessee shall document the cost of said cure and supply
said documentation to Lessor.


 




    	 	 	 
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14. Condemnation.
If the Premises or any portion thereof are taken under the power of eminent domain or sold under the threat of the exercise of said power
(collectively “Condemnation”), this Lease shall terminate as to the part taken as of the date the condemning authority
takes title or possession, whichever first occurs. If more than 10% of the floor area of the Unit, or more than 25% of the
parking spaces is taken by Condemnation, Lessee may, at Lessee’s option, to be exercised in writing within 10 days after Lessor
shall have given Lessee written notice of such taking (or in the absence of such notice, within 10 days after the condemning authority
shall have taken possession) terminate this Lease as of the date the condemning authority takes such possession. If Lessee does not terminate
this Lease in accordance with the foregoing, this Lease shall remain in full force and effect as to the portion of the Premises
remaining, except that the Base Rent shall be reduced in proportion to the reduction in utility of the Premises caused by such Condemnation.
Condemnation awards and/or payments shall be the property of Lessor, whether such award shall be made as compensation for diminution
in value of the leasehold, the value of the part taken, or for severance damages; provided, however, that Lessee shall be entitled to
any compensation paid by the condemnor for Lessee’s relocation expenses, loss of business goodwill and/or Trade Fixtures, without
regard to whether or not this Lease is terminated pursuant to the provisions of this Paragraph. All Alterations and Utility Installations
made to the Premises by Lessee, for purposes of Condemnation only, shall be considered the property of the Lessee and Lessee shall be
entitled to any and all compensation which is payable therefor. In the event that this Lease is not terminated by reason of the Condemnation,
Lessor shall repair any damage to the Premises caused by such Condemnation.


 


15.
Brokerage Fees.


 


15.1
Additional Commission. In addition to the payments owed pursuant to Paragraph 1.10 above, Lessor agrees that: (a) if Lessee
exercises any Option, (b) if Lessee or anyone affiliated with Lessee acquires from Lessor any rights to the Premises or other
premises owned by Lessor and located within the Project, (c) if Lessee remains in possession of the Premises, with the consent of Lessor,
after the expiration of this Lease, or (d) if Base Rent is increased, whether by agreement or operation of an escalation clause herein,
then, Lessor shall pay Brokers a fee in accordance with the fee schedule of the Brokers in effect at the time the Lease was executed.
The provisions of this paragraph are intended to supersede the provisions of any earlier agreement to the contrary.


 


15.2 Assumption
of Obligations. Any buyer or transferee of Lessor’s interest in this Lease shall be deemed to have assumed Lessor’s obligation
hereunder. Brokers shall be third party beneficiaries of the provisions of Paragraphs 1.10, 15, 22 and 31. If Lessor fails to pay
to Brokers any amounts due as and for brokerage fees pertaining to this Lease when due, then such amounts shall accrue Interest. In addition,
if Lessor fails to pay any amounts to Lessee’s Broker when due, Lessee’s Broker may send written notice to Lessor and Lessee
of such failure and if Lessor fails to pay such amounts within 10 days after said notice, Lessee shall pay said monies to its Broker
and offset such amounts against Rent. In addition, Lessee’s Broker shall be deemed to be a third party beneficiary of
any commission agreement entered into by and/or between Lessor and Lessor’s Broker for the limited purpose of collecting any brokerage
fee owed.


 


15.3 Representations
and Indemnities of Broker Relationships. Lessee and Lessor each represent and warrant to the other that it has had no dealings
with any person, firm, broker, agent or finder (other than the Brokers and Agents, if any) in connection with this Lease,
and that no one other than said named Brokers and Agents is entitled to any commission or finder’s fee in connection
herewith. Lessee and Lessor do each hereby agree to indemnify, protect, defend and hold the other harmless from and against
liability for compensation or charges which may be claimed by any such unnamed broker, finder or other similar party by reason
of any dealings or actions of the indemnifying Party, including any costs, expenses, attorneys’ fees reasonably incurred with
respect thereto.


 


16.
Estoppel Certificates.




 


(a) Each
Party (as “Responding Party”) shall within 10 days after written notice from the other Party (the “Requesting
Party”) execute, acknowledge and deliver to the Requesting Party a statement in writing in form similar to the then most current
“Estoppel Certificate” form published BY AIR CRE, plus such additional information, confirmation and/or
statements as may be reasonably requested by the Requesting Party.


 


(b) If
the Responding Party shall fail to execute or deliver the Estoppel Certificate within such 10 day period, the Requesting Party may
execute an Estoppel Certificate stating that: (i) the Lease is in full force and effect without modification except as
may be represented by the Requesting Party, (ii) there are no uncured defaults in the Requesting Party’s performance, and (iii)
if Lessor is the Requesting Party, not more than one month’s rent has been paid in advance. Prospective purchasers and encumbrancers
may rely upon the Requesting Party’s Estoppel Certificate, and the Responding Party shall be estopped from denying the truth
of the facts contained in said Certificate. In addition, Lessee acknowledges that any failure on its part to provide such an Estoppel
Certificate will expose Lessor to risks and potentially cause Lessor to incur costs not contemplated by this Lease, the extent of
which will be extremely difficult to ascertain. Accordingly, should the Lessee fail to execute and/or deliver a requested Estoppel
Certificate in a timely fashion the monthly Base Rent shall be automatically increased, without any requirement for notice to Lessee,
by an amount equal to 10% of the then existing Base Rent or $100, whichever is greater for remainder of the Lease. The Parties agree
that such increase in Base Rent represents fair and reasonable compensation for the additional risk/costs that Lessor will incur by reason
of Lessee’s failure to provide the Estoppel Certificate. Such increase in Base Rent shall in no event constitute a waiver
of Lessee’s Default or Breach with respect to the failure to provide the Estoppel Certificate nor prevent the exercise of
any of the other rights and remedies granted hereunder.


 


(c) If
Lessor desires to finance, refinance, or sell the Premises, or any part thereof, Lessee and all Guarantors shall within 10
days after written notice from Lessor deliver to any potential lender or purchaser designated by Lessor such financial statements
as may be reasonably required by such lender or purchaser, including but not limited to Lessee’s financial statements for
the past 3 years. All such financial statements shall be received by Lessor and such lender or purchaser in confidence and
shall be used only for the purposes herein set forth.


 




    	 	 	 
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17. Definition
of Lessor. The term “Lessor” as used herein shall mean the owner or owners at the time in question of the fee
title to the Premises, or, if this is a sublease, of the Lessee’s interest in the prior lease. In the event of a transfer of Lessor’s
title or interest in the Premises or this Lease, Lessor shall deliver to the transferee or assignee (in cash or by credit) any unused
Security Deposit held by Lessor. Upon such transfer or assignment and delivery of the Security Deposit, as aforesaid, the prior Lessor
shall be relieved of all liability with respect to the obligations and/or covenants under this Lease thereafter to be performed by the
Lessor. Subject to the foregoing, the obligations and/or covenants in this Lease to be performed by the Lessor shall be binding only
upon the Lessor as hereinabove defined.


 


18. Severability.
The invalidity of any provision of this Lease, as determined by a court of competent jurisdiction, shall in no way affect the
validity of any other provision hereof.


 


 19. Days. Unless otherwise specifically indicated to the contrary, the word “days” as used in this Lease shall mean and refer to calendar days.




 


20. Limitation
on Liability. The obligations of Lessor under this Lease shall not constitute personal obligations of Lessor, or its partners, members,
directors, officers or shareholders, and Lessee shall look to the Premises, and to no other assets of Lessor, for the satisfaction
of any liability of Lessor with respect to this Lease, and shall not seek recourse against Lessor’s partners, members, directors,
officers or shareholders, or any of their personal assets for such satisfaction.


 


21. Time
of Essence. Time is of the essence with respect to the performance of all obligations to be performed or observed by the Parties
under this Lease.


 


22. No
Prior or Other Agreements; Broker Disclaimer. This Lease contains all agreements between the Parties with respect to any matter mentioned
herein, and no other prior or contemporaneous agreement or understanding shall be effective. Lessor and Lessee each represents and
warrants to the Brokers that it has made, and is relying solely upon, its own investigation as to the nature, quality, character and
financial responsibility of the other Party to this Lease and as to the use, nature, quality and character of the Premises. Brokers
have no responsibility with respect thereto or with respect to any default or breach hereof by either Party.


 


23.
Notices.




 


23.1 Notice
Requirements. All notices required or permitted by this Lease or applicable law shall be in writing and may be delivered in person
(by hand or by courier) or may be sent by regular, certified or registered mail or U.S. Postal Service Express Mail, with postage
prepaid, or by facsimile transmission, or by email, and shall be deemed sufficiently given if served in a manner specified
in this Paragraph 23. The addresses noted adjacent to a Party’s signature on this Lease shall be that Party’s address for
delivery or mailing of notices. Either Party may by written notice to the other specify a different address for notice, except that
upon Lessee’s taking possession of the Premises, the Premises shall constitute Lessee’s address for notice. A copy of all
notices to Lessor shall be concurrently transmitted to such party or parties at such addresses as Lessor may from time to time hereafter
designate in writing.


 


23.2 Date
of Notice. Any notice sent by registered or certified mail, return receipt requested, shall be deemed given on the date of delivery
shown on the receipt card, or if no delivery date is shown, the postmark thereon. If sent by regular mail the notice shall be deemed
given 72 hours after the same is addressed as required herein and mailed with postage prepaid. Notices delivered by United States Express
Mail or overnight courier that guarantees next day delivery shall be deemed given 24 hours after delivery of the same to the Postal Service
or courier. Notices delivered by hand, or transmitted by facsimile transmission or by email shall be deemed delivered upon actual receipt.
If notice is received on a Saturday, Sunday or legal holiday, it shall be deemed received on the next business day.


 


23.3 Options. Notwithstanding
the foregoing, in order to exercise any Options (see paragraph 39), the Notice must be sent by Certified Mail (return receipt
requested), Express Mail (signature required), courier (signature required) or some other methodology that provides a receipt
establishing the date the notice was received by the Lessor.


 




    	 	 	 
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24.
Waivers.




 


(a) No
waiver by Lessor of the Default or Breach of any term, covenant or condition hereof by Lessee, shall be deemed a waiver of any other
term, covenant or condition hereof, or of any subsequent Default or Breach by Lessee of the same or of any other term, covenant or condition
hereof. Lessor’s consent to, or approval of, any act shall not be deemed to render unnecessary the obtaining of Lessor’s
consent to, or approval of, any subsequent or similar act by Lessee, or be construed as the basis of an estoppel to enforce the provision
or provisions of this Lease requiring such consent.


 


(b)
The acceptance of Rent by Lessor shall not be a waiver of any Default or Breach by Lessee. Any payment by Lessee may be accepted by
Lessor on account of monies or damages due Lessor, notwithstanding any qualifying statements or conditions made by Lessee in
connection therewith, which such statements and/or conditions shall be of no force or effect whatsoever unless specifically agreed
to in writing by Lessor at or before the time of deposit of such payment.


 


(c) THE
PARTIES AGREE THAT THE TERMS OF THIS LEASE SHALL GOVERN WITH REGARD TO ALL MATTERS RELATED THERETO AND HEREBY WAIVE THE PROVISIONS OF
ANY PRESENT OR FUTURE STATUTE TO THE EXTENT THAT SUCH STATUTE IS INCONSISTENT WITH THIS LEASE.


 


25.
Disclosures Regarding The Nature of a Real Estate Agency Relationship.




 


(a) When
entering into a discussion with a real estate agent regarding a real estate transaction, a Lessor or Lessee should from the outset understand
what type of agency relationship or representation it has with the agent or agents in the transaction. Lessor and Lessee acknowledge
being advised by the Brokers in this transaction, as follows:


 


(i) Lessor’s
Agent. A Lessor’s agent under a listing agreement with the Lessor acts as the agent for the Lessor only. A Lessor’s
agent or subagent has the following affirmative obligations: To the Lessor: A fiduciary duty of utmost care,
integrity, honesty, and loyalty in dealings with the Lessor. To the Lessee and the Lessor: (a) Diligent exercise of reasonable
skills and care in performance of the agent’s duties. (b) A duty of honest and fair dealing and good faith. (c) A duty to disclose
all facts known to the agent materially affecting the value or desirability of the property that are not known to, or within the
diligent attention and observation of, the Parties. An agent is not obligated to reveal to either Party any confidential information
obtained from the other Party which does not involve the affirmative duties set forth above.


 


(ii) Lessee’s
Agent. An agent can agree to act as agent for the Lessee only. In these situations, the agent is not the Lessor’s agent,
even if by agreement the agent may receive compensation for services rendered, either in full or in part from the Lessor. An agent acting
only for a Lessee has the following affirmative obligations. To the Lessee: A fiduciary duty of utmost care,
integrity, honesty, and loyalty in dealings with the Lessee. To the Lessee and the Lessor: (a) Diligent exercise of reasonable
skills and care in performance of the agent’s duties. (b) A duty of honest and fair dealing and good faith. (c) A duty to disclose
all facts known to the agent materially affecting the value or desirability of the property that are not known to, or within the
diligent attention and observation of, the Parties. An agent is not obligated to reveal to either Party any confidential information
obtained from the other Party which does not involve the affirmative duties set forth above.


 


(iii) Agent
Representing Both Lessor and Lessee. A real estate agent, either acting directly or through one or more associate licenses, can
legally be the agent of both the Lessor and the Lessee in a transaction, but only with the knowledge and consent of both the Lessor and
the Lessee. In a dual agency situation, the agent has the following affirmative obligations to both the Lessor and the Lessee: (a)
A fiduciary duty of utmost care, integrity, honesty and loyalty in the dealings with either Lessor or the Lessee. (b) Other duties
to the Lessor and the Lessee as stated above in subparagraphs (i) or (ii). In representing both Lessor and Lessee, the agent may not,
without the express permission of the respective Party, disclose to the other Party confidential information, including, but not
limited to, facts relating to either Lessee’s or Lessor’s financial position, motivations, bargaining position, or other
personal information that may impact rent, including Lessor’s willingness to accept a rent less than the listing rent or Lessee’s
willingness to pay rent greater than the rent offered. The above duties of the agent in a real estate transaction do not relieve
a Lessor or Lessee from the responsibility to protect their own interests. Lessor and Lessee should carefully read all agreements to
assure that they adequately express their understanding of the transaction. A real estate agent is a person qualified to advise
about real estate. If legal or tax advice is desired, consult a competent professional. Both Lessor and Lessee should strongly consider
obtaining tax advice from a competent professional because the federal and state tax consequences of a transaction can be complex and
subject to change.


 


(b) Brokers
have no responsibility with respect to any default or breach hereof by either Party. The Parties agree that no lawsuit or other legal
proceeding involving any breach of duty, error or omission relating to this Lease may be brought against Broker more than one year after
the Start Date and that the liability (including court costs and attorneys’ fees), of any Broker with respect to any such lawsuit
and/or legal proceeding shall not exceed the fee received by such Broker pursuant to this Lease; provided, however, that the foregoing
limitation on each Broker’s liability shall not be applicable to any gross negligence or willful misconduct of such Broker.


 


(c) Lessor
and Lessee agree to identify to Brokers as “Confidential” any communication or information given Brokers that is considered
by such Party to be confidential.


 




    	 	 	 
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26. No
Right To Holdover. Lessee has no right to retain possession of the Premises or any part thereof beyond the expiration or termination
of this Lease. At or prior to the expiration or termination of this Lease Lessee shall deliver exclusive possession of the Premises to
Lessor. For purposes of this provision and Paragraph 13.1(a), exclusive possession shall mean that Lessee shall have vacated the Premises,
removed all of its personal property therefrom and that the Premises have been returned in the condition specified in this Lease.
In the event that Lessee does not deliver exclusive possession to Lessor as specified above, then Lessor’s damages during
any holdover period shall be computed at the amount of the Rent (as defined in Paragraph 4.1) due during the last full month before
the expiration or termination of this Lease (disregarding any temporary abatement of Rent that may have been in effect), but with
Base Rent being 150% of the Base Rent payable during such last full month. Nothing contained herein shall be construed as consent by
Lessor to any holding over by Lessee.


 


27. Cumulative
Remedies. No remedy or election hereunder shall be deemed exclusive but shall, wherever possible, be cumulative with all other remedies
at law or in equity.


 


28. Covenants
and Conditions; Construction of Agreement. All provisions of this Lease to be observed or performed by Lessee are both covenants
and conditions. In construing this Lease, all headings and titles are for the convenience of the Parties only and shall not be considered
a part of this Lease. Whenever required by the context, the singular shall include the plural and vice versa. This Lease shall not be
construed as if prepared by one of the Parties, but rather according to its fair meaning as a whole, as if both Parties had prepared
it.


 


29. Binding
Effect; Choice of Law. This Lease shall be binding upon the Parties, their personal representatives, successors and assigns
and be governed by the laws of the State in which the Premises are located. Any litigation between the Parties hereto concerning this
Lease shall be initiated in the county in which the Premises are located. Signatures to this Lease accomplished by means of electronic
signature or similar technology shall be legal and binding.


 


30.
Subordination; Attornment; Non-Disturbance.




 


30.1 Subordination.
This Lease and any Option granted hereby shall be subject and subordinate to any ground lease, mortgage, deed of trust, or other hypothecation
or security device (collectively, “Security Device”), now or hereafter placed upon the Premises, to any and all advances
made on the security thereof, and to all renewals, modifications, and extensions thereof. Lessee agrees that the holders of any
such Security Devices (in this Lease together referred to as “Lender”) shall have no liability or obligation to perform
any of the obligations of Lessor under this Lease. Any Lender may elect to have this Lease and/or any Option granted hereby superior
to the lien of its Security Device by giving written notice thereof to Lessee, whereupon this Lease and such Options shall be deemed
prior to such Security Device, notwithstanding the relative dates of the documentation or recordation thereof.


 


30.2 Attornment.
In the event that Lessor transfers title to the Premises, or the Premises are acquired by another upon the foreclosure or termination
of a Security Device to which this Lease is subordinated (i) Lessee shall, subject to the non-disturbance provisions of Paragraph 30.3,
attorn to such new owner, and upon request, enter into a new lease, containing all of the terms and provisions of this Lease, with such
new owner for the remainder of the term hereof, or, at the election of the new owner, this Lease will automatically become a new lease
between Lessee and such new owner, and (ii) Lessor shall thereafter be relieved of any further obligations hereunder and such new owner
shall assume all of Lessor’s obligations, except that such new owner shall not: (a) be liable for any act or omission of any prior
lessor or with respect to events occurring prior to acquisition of ownership; (b) be subject to any offsets or defenses which Lessee
might have against any prior lessor, (c) be bound by prepayment of more than one month’s rent, or (d) be liable for the return
of any security deposit paid to any prior lessor which was not paid or credited to such new owner.


 


30.3 Non-Disturbance.
With respect to Security Devices entered into by Lessor after the execution of this Lease, Lessee’s subordination of this
Lease shall be subject to receiving a commercially reasonable non-disturbance agreement (a “Non-Disturbance
Agreement”) from the Lender which Non-Disturbance Agreement provides that Lessee’s possession of the Premises, and
this Lease, including any options to extend the term hereof, will not be disturbed so long as Lessee is not in Breach hereof and
attorns to the record owner of the Premises. Further, within 60 days after the execution of this Lease, Lessor shall, if requested
by Lessee, use its commercially reasonable efforts to obtain a Non-Disturbance Agreement from the holder of any pre-existing
Security Device which is secured by the Premises. In the event that Lessor is unable to provide the Non-Disturbance Agreement within
said 60 days, then Lessee may, at Lessee’s option, directly contact Lender and attempt to negotiate for the execution and
delivery of a Non-Disturbance Agreement.


 


30.4 Self-Executing.
The agreements contained in this Paragraph 30 shall be effective without the execution of any further documents; provided, however,
that, upon written request from Lessor or a Lender in connection with a sale, financing or refinancing of the Premises, Lessee
and Lessor shall execute such further writings as may be reasonably required to separately document any subordination, attornment and/or
Non-Disturbance Agreement provided for herein.


 




    	 	 	 
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31. Attorneys’
Fees. If any Party or Broker brings an action or proceeding involving the Premises whether founded in tort, contract or equity, or
to declare rights hereunder, the Prevailing Party (as hereafter defined) in any such proceeding, action, or appeal thereon, shall
be entitled to reasonable attorneys’ fees. Such fees may be awarded in the same suit or recovered in a separate suit, whether or
not such action or proceeding is pursued to decision or judgment. The term, “Prevailing Party” shall include, without
limitation, a Party or Broker who substantially obtains or defeats the relief sought, as the case may be, whether by compromise, settlement,
judgment, or the abandonment by the other Party or Broker of its claim or defense. The attorneys’ fees award shall not be computed
in accordance with any court fee schedule, but shall be such as to fully reimburse all attorneys’ fees reasonably incurred. In
addition, Lessor shall be entitled to attorneys’ fees, costs and expenses incurred in the preparation and service of notices of
Default and consultations in connection therewith, whether or not a legal action is subsequently commenced in connection with such Default
or resulting Breach ($200 is a reasonable minimum per occurrence for such services and consultation).


 


32. Lessor’s
Access; Showing Premises; Repairs. Lessor and Lessor’s agents shall have the right to enter the Premises at any time, in the
case of an emergency, and otherwise at reasonable times after reasonable prior notice for the purpose of showing the same to prospective
purchasers, lenders, or tenants, and making such alterations, repairs, improvements or additions to the Premises as Lessor may deem necessary
or desirable and the erecting, using and maintaining of utilities, services, pipes and conduits through the Premises and/or other premises
as long as there is no material adverse effect on Lessee’s use of the Premises. All such activities shall be without abatement
of rent or liability to Lessee.


 


33. Auctions.
Lessee shall not conduct, nor permit to be conducted, any auction upon the Premises without Lessor’s prior written consent.
Lessor shall not be obligated to exercise any standard of reasonableness in determining whether to permit an auction.


 


34. Signs.
Lessor may place on the Premises ordinary “For Sale” signs at any time and ordinary “For Lease” signs during
the last 6 months of the term hereof. Except for ordinary “For Sublease” signs which may be placed only on the Premises,
Lessee shall not place any sign upon the Project without Lessor’s prior written consent. All signs must comply with all Applicable
Requirements.


 


35. Termination;
Merger. Unless specifically stated otherwise in writing by Lessor, the voluntary or other surrender of this Lease by Lessee,
the mutual termination or cancellation hereof, or a termination hereof by Lessor for Breach by Lessee, shall automatically terminate
any sublease or lesser estate in the Premises; provided, however, that Lessor may elect to continue any one or all existing subtenancies.
Lessor’s failure within 10 days following any such event to elect to the contrary by written notice to the holder of any such lesser
interest, shall constitute Lessor’s election to have such event constitute the termination of such interest.


 


36. Consents.
All requests for consent shall be in writing. Except as otherwise provided herein, wherever in this Lease the consent of a Party
is required to an act by or for the other Party, such consent shall not be unreasonably withheld or delayed. Lessor’s actual reasonable
costs and expenses (including but not limited to architects’, attorneys’, engineers’ and other consultants’ fees)
incurred in the consideration of, or response to, a request by Lessee for any Lessor consent, including but not limited to consents to
an assignment, a subletting or the presence or use of a Hazardous Substance, shall be paid by Lessee upon receipt of an invoice and supporting
documentation therefor. Lessor’s consent to any act, assignment or subletting shall not constitute an acknowledgment that no Default
or Breach by Lessee of this Lease exists, nor shall such consent be deemed a waiver of any then existing Default or Breach, except as
may be otherwise specifically stated in writing by Lessor at the time of such consent. The failure to specify herein any particular
condition to Lessor’s consent shall not preclude the imposition by Lessor at the time of consent of such further or other conditions
as are then reasonable with reference to the particular matter for which consent is being given. In the event that either Party disagrees
with any determination made by the other hereunder and reasonably requests the reasons for such determination, the determining party
shall furnish its reasons in writing and in reasonable detail within 10 business days following such request.


 


37.
Guarantor.


 




 37.1 Execution. The Guarantors, if any, shall each execute a guaranty in the form most recently published BY AIR CRE.




 


37.2
Default. It shall constitute a Default of the Lessee if any Guarantor fails or refuses, upon request to provide: (a) evidence
of the execution of the guaranty, including the authority of the party signing on Guarantor’s behalf to obligate Guarantor, and
in the case of a corporate Guarantor, a certified copy of a resolution of its board of directors authorizing the making of such
guaranty, (b) current financial statements, (c) an Estoppel Certificate, or (d) written confirmation that the guaranty
is still in effect.


 




    	 	 	 
	INITIALS	INITIALS	Page 25 of 34



     


    

 


38. Quiet
Possession. Subject to payment by Lessee of the Rent and performance of all of the covenants, conditions and provisions on Lessee’s
part to be observed and performed under this Lease, Lessee shall have quiet possession and quiet enjoyment of the Premises during the
term hereof.


 


 39. Options. If Lessee is granted any option, as defined below, then the following provisions shall apply.


 




39.1 Definition.
“Option” shall mean: (a) the right to extend or reduce the term of or renew this Lease or to extend or reduce the
term of or renew any lease that Lessee has on other property of Lessor; (b) the right of first refusal or first offer
to lease either the Premises or other property of Lessor; (c) the right to purchase, the right of first offer to purchase or
the right of first refusal to purchase the Premises or other property of Lessor.


 


39.2 Options
Personal To Original Lessee. Any Option granted to Lessee in this Lease is personal to the original Lessee, and cannot be assigned
or exercised by anyone other than said original Lessee and only while the original Lessee is in full possession of the Premises and,
if requested by Lessor, with Lessee certifying that Lessee has no intention of thereafter assigning or subletting.


 


39.3 Multiple
Options. In the event that Lessee has any multiple Options to extend or renew this Lease, a later Option cannot be exercised unless
the prior Options have been validly exercised.


 


39.4
Effect of Default on Options.




 


(a) Lessee
shall have no right to exercise an Option: (i) during the period commencing with the giving of any notice of Default and continuing until
said Default is cured, (ii) during the period of time any Rent is unpaid (without regard to whether notice thereof is given Lessee),
(iii) during the time Lessee is in Breach of this Lease, or (iv) in the event that Lessee has been given 3 or more notices of separate
Default, whether or not the Defaults are cured, during the 12 month period immediately preceding the exercise of the Option.


 


(b) The
period of time within which an Option may be exercised shall not be extended or enlarged by reason of Lessee’s inability to exercise
an Option because of the provisions of Paragraph 39.4(a).


 


(c) An
Option shall terminate and be of no further force or effect, notwithstanding Lessee’s due and timely exercise of the Option,
if, after such exercise and prior to the commencement of the extended term or completion of the purchase, (i) Lessee fails to pay Rent
for a period of 30 days after such Rent becomes due (without any necessity of Lessor to give notice thereof), or (ii) if Lessee commits
a Breach of this Lease.


 


40. Security
Measures. Lessee hereby acknowledges that the Rent payable to Lessor hereunder does not include the cost of guard service or other
security measures, and that Lessor shall have no obligation whatsoever to provide same. Lessee assumes all responsibility for the protection
of the Premises, Lessee, its agents and invitees and their property from the acts of third parties.


 


41. Reservations.
Lessor reserves the right: (i) to grant, without the consent or joinder of Lessee, such easements, rights and dedications that Lessor
deems necessary; (ii) to cause the recordation of parcel maps and restrictions; and (iii) to create and/or install new utility raceways,
so long as such easements, rights, dedications, maps, restrictions, and utility raceways do not unreasonably interfere with the use of
the Premises by Lessee. Lessee agrees to sign any documents reasonably requested by Lessor to effectuate such rights.


 


42. Performance
Under Protest. If at any time a dispute shall arise as to any amount or sum of money to be paid by one Party to the other under the
provisions hereof, the Party against whom the obligation to pay the money is asserted shall have the right to make payment “under
protest” and such payment shall not be regarded as a voluntary payment and there shall survive the right on the part of said Party
to institute suit for recovery of such sum. If it shall be adjudged that there was no legal obligation on the part of said Party to pay
such sum or any part thereof, said Party shall be entitled to recover such sum or so much thereof as it was not legally required to pay.
A Party who does not initiate suit for the recovery of sums paid “under protest” within 6 months shall be deemed to have
waived its right to protest such payment.


 


43.
Authority; Multiple Parties; Execution.




 


(a) If
either Party hereto is a corporation, trust, limited liability company, partnership, or similar entity, each individual executing this
Lease on behalf of such entity represents and warrants that he or she is duly authorized to execute and deliver this Lease on its behalf.
Each Party shall, within 30 days after request, deliver to the other Party satisfactory evidence of such authority.


 


(b) If
this Lease is executed by more than one person or entity as “Lessee”, each such person or entity shall be jointly and severally
liable hereunder. It is agreed that any one of the named Lessees shall be empowered to execute any amendment to this Lease, or other
document ancillary thereto and bind all of the named Lessees, and Lessor may rely on the same as if all of the named Lessees had executed
such document.


 


(c) This
Lease may be executed by the Parties in counterparts, each of which shall be deemed an original and all of which together shall constitute
one and the same instrument.


 




    	 	 	 
	INITIALS	INITIALS	Page 26 of 34



     


    

 


44. Conflict.
Any conflict between the printed provisions of this Lease and the typewritten or handwritten provisions shall be controlled
by the typewritten or handwritten provisions.


 


45. Offer.
Preparation of this Lease by either party or their agent and submission of same to the other Party shall not be deemed an offer
to lease to the other Party. This Lease is not intended to be binding until executed and delivered by all Parties hereto.


 


46. Amendments.
This Lease may be modified only in writing, signed by the Parties in interest at the time of the modification. As long
as they do not materially change Lessee’s obligations hereunder, Lessee agrees to make such reasonable non-monetary modifications
to this Lease as may be reasonably required by a Lender in connection with the obtaining of normal financing or refinancing
of the Premises.


 


47. Waiver
of Jury Trial. THE PARTIES HEREBY WAIVE THEIR RESPECTIVE RIGHTS TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING INVOLVING THE PROPERTY OR
ARISING OUT OF THIS AGREEMENT.


 


 48. Arbitration
of Disputes. An Addendum requiring the Arbitration of all disputes between the Parties and/or Brokers arising out of this Lease
☒ is ☐ is not attached to this Lease.




 


49.
Accessibility; Americans with Disabilities Act.




 


 (a) The Premises:




 


☒
have not undergone an inspection by a Certified Access Specialist (CASp). Note: A Certified Access Specialist (CASp) can
inspect the subject premises and determine whether the subject premises comply with all of the applicable construction-related
accessibility standards under state law. Although state law does not require a CASp inspection of the subject premises, the
commercial property owner or lessor may not prohibit the lessee or tenant from obtaining a CASp inspection of the subject premises
for the occupancy or potential occupancy of the lessee or tenant, if requested by the lessee or tenant. The parties shall mutually
agree on the arrangements for the time and manner of the CASp inspection, the payment of the fee for the CASp inspection, and the
cost of making any repairs necessary to correct violations of construction-related accessibility standards within the
premises.


 


☐
have undergone an inspection by a Certified Access Specialist (CASp) and it was determined that the Premises met all applicable
construction-related accessibility standards pursuant to California Civil Code §55.51 et seq. Lessee acknowledges that it
received a copy of the inspection report at least 48 hours prior to executing this Lease and agrees to keep such report
confidential.


 


☐
have undergone an inspection by a Certified Access Specialist (CASp) and it was determined that the Premises did not meet all
applicable construction-related accessibility standards pursuant to California Civil Code §55.51 et seq. Lessee acknowledges
that it received a copy of the inspection report at least 48 hours prior to executing this Lease and agrees to keep such report
confidential except as necessary to complete repairs and corrections of violations of construction related accessibility
standards.


 



    	 	 	 
	INITIALS	INITIALS	Page 27 of 34



     


    

 











In
the event that the Premises have been issued an inspection report by a CASp the Lessor shall provide a copy of the disability access
inspection certificate to Lessee within 7 days of the execution of this Lease.


 


(b)
Since compliance with the Americans with Disabilities Act (ADA) and other state and local accessibility statutes are dependent upon Lessee’s
specific use of the Premises, Lessor makes no warranty or representation as to whether or not the Premises comply with ADA or any
similar legislation. In the event that Lessee’s use of the Premises requires modifications or additions to the Premises in
order to be in compliance with ADA or other accessibility statutes, Lessee agrees to make any such necessary modifications and/or
additions at Lessee’s expense.


 


LESSOR
AND LESSEE HAVE CAREFULLY READ AND REVIEWED THIS LEASE AND EACH TERM AND PROVISION CONTAINED HEREIN, AND BY THE EXECUTION OF THIS LEASE
SHOW THEIR INFORMED AND VOLUNTARY CONSENT THERETO. THE PARTIES HEREBY AGREE THAT, AT THE TIME THIS LEASE IS EXECUTED, THE TERMS OF THIS
LEASE ARE COMMERCIALLY REASONABLE AND EFFECTUATE THE INTENT AND PURPOSE OF LESSOR AND LESSEE WITH RESPECT TO THE PREMISES.


 


ATTENTION:
NO REPRESENTATION OR RECOMMENDATION IS MADE BY AIR CRE OR BY ANY BROKER AS TO THE LEGAL SUFFICIENCY, LEGAL EFFECT, OR TAX CONSEQUENCES
OF THIS LEASE OR THE TRANSACTION TO WHICH IT RELATES. THE PARTIES ARE URGED TO:


 


1.
SEEK ADVICE OF COUNSEL AS TO THE LEGAL AND TAX CONSEQUENCES OF THIS LEASE. 


2.
RETAIN APPROPRIATE CONSULTANTS TO REVIEW AND INVESTIGATE THE CONDITION OF THE PREMISES. SAID INVESTIGATION SHOULD INCLUDE BUT NOT BE
LIMITED TO: THE POSSIBLE PRESENCE OF HAZARDOUS SUBSTANCES, THE ZONING OF THE PREMISES, THE STRUCTURAL INTEGRITY, THE CONDITION OF THE
ROOF AND OPERATING SYSTEMS, COMPLIANCE WITH THE AMERICANS WITH DISABILITIES ACT AND THE SUITABILITY OF THE PREMISES FOR LESSEE’S
INTENDED USE.


 


WARNING:
IF THE PREMISES ARE LOCATED IN A STATE OTHER THAN CALIFORNIA, CERTAIN PROVISIONS OF THE LEASE MAY NEED TO BE REVISED TO COMPLY WITH THE
LAWS OF THE STATE IN WHICH THE PREMISES ARE LOCATED.


 


The
parties hereto have executed this Lease at the place and on the dates specified above their respective signatures.


 


	Executed
at:
	Kapalua,
    Hawaii	 	Executed
    at:	Huntington
    Beach
	 	 	 	 	 
	On:	September
    30, 2022 | 12:56 PM PDT	 	On:
	September
30, 2022 | 12:20 PM PDT 

	 	 	 	 	 
	By
    LESSOR:	 	By
    LESSEE:	 
	 	 	 	 
	Slater
    Palms LLC	 	Submersible
    Systems, Inc., a Florida corporation
	 	 	 	 	 
	By:		 	By:	
	 	 	 	 	 
	Name
    Printed:	Stephen
    J. Rimel	 	Name
    Printed:	Christeen
    Buban
	Title:	Managing
    Member	 	Title:	President
	Phone:	 	 	Phone:	 
	Fax:	 	 	Fax:	 
	Email:	 	 	Email:	 
	 	 	 	 	 
	By:	 	 	By:	 
	Name
    Printed:	 	 	Name
    Printed:	 
	Title:	 	 	Title:	 
	Phone:	 	 	Phone:	 
	Fax:	 	 	Fax:	 
	Email:	 	 	Email:	 
	Address	 	 	Address	 



 


	Federal
    ID No.:	 	 	Federal
    ID No.:	 
	 	 	 	 	 
	BROKER	 	BROKER	 
	 	 	 	 
	Lee
    & Associates®-Newport Beach	 	 	 
	 	 	 	 	 
	Attn:	Brad
    Schneider/Nick Krakower	 	Attn:	 
	Title:	SVP/Principal
    / Senior Associate	 	Title:	 
	 	 	 	 	 
	Address:	100
    Bayview Circle, Suite 600	 	Address:	 
	 	Newport
    Beach, CA 92660	 	 	 
	Phone:	(949)
    724-4708/(949) 724-4720	 	Phone:	 
	Fax:	(949)
    623-6308/(949( 6320	 	Fax:	 
	Email:	bschneider@lee-associates.com/

    nkrakower@lee-associates.com
	 	Email:	 



 


	Federal
    ID No.:	 	 	Federal
    ID No.:	 
	Broker
    DRE License #:	01197433	 	Broker
    DRE License #:	 
	Agent
    DRE License #:	01887613/02100512	 	Agent
    DRE License #:	 





 


AIR
CRE * https://www.aircre.com * 213-687-8777 * contracts@aircre.com


NOTICE:
No part of these works may be reproduced in any form without permission in writing.


Schneider/Submersible
Systems-7413 Slater Avenue-Gross Lease





 




    	 	 	 
	INITIALS	INITIALS	Page 28 of 34



     


    

 


 


 


ADDENDUM
TO LEASE


 


	 	 	Date:	September
    14, 2022
	 	 	 	 
	 	By and Between	 
	 	 	Lessor:	Slater
    Palms LLC
	 	 	 	 
	 	 	Lessee:	Submersible
    Systems, Inc., a Florida corporation
	 	 	 	 
	 	Property Address:	7413
    Slater Avenue, Huntington Beach, CA 92647
	 	 	(street
    address, city, state, zip)





 


Paragraph:
50-53


 


In
the event of any conflict between the provisions of this Addendum and the printed provisions of the Lease, this Addendum shall control.








 


50.
Rent Schedule:


 


February
1, 2023 - January 31, 2024               $17,550.00


February
1, 2024 - January 31, 2025               $17,550.00


February
1, 2025 - January 31, 2026               $18,077.00


February
1, 2026 - January 31, 2027               $18,619.00


February
1, 2027 - January 31, 2028                $19,177.00


 


51.
Lessor Improvements:


 


Lessor,
at Lessor’s sole cost & expense, shall install a new roll up door.


 


52.
Operating Expenses:


 


The
above mentioned Rent is inclusive of a $0.05/SF Common Area Operating Expense (CAM). Lessee shall not be obligated to pay any additional
CAM charge during the term of the lease.


 


53.
Security Deposit:


 


The
current Security Deposit on file is $8,450.00. The total Security Deposit required is $19,177.00. Therefore, the Lessee shall pay to
Lessor a Security Deposit equivalent to $10,727.00 upon execution of this lease.


 





AIR
CRE * https://www.aircre.com * 213-687-8777 * contracts@aircre.com


NOTICE:
No part of these works may be reproduced in any form without permission in writing.


Submersible
Systems-7413 Slater Avenue-Gross Lease


 






    	 	 	 
	INITIALS	INITIALS	Page 29 of 34



     


    




 


 


 


 


ARBITRATION
AGREEMENT


STANDARD
LEASE ADDENDUM


 


	 	 	Dated:	September
    14, 2022 
	 	 	 	 
	 	By and Between	 
	 	 	 
	 	 	Lessor:	Slater
    Palms LLC 
	 	 	 	 
	 	 	Lessee:
    	Submersible
    Systems, Inc., a Florida corporation 
	 	 	 	 
	 	Property Address: 	7413 Slater Avenue, Huntington Beach, CA 92647
	 	 	(street
address, city, state, zip)





 


Paragraph:
54


 


A.
ARBITRATION OF DISPUTES:


 


Except
as provided in Paragraph B below, the Parties agree to resolve any and all claims, disputes or disagreements arising under this Lease,
including, but not limited to any matter relating to Lessor’s failure to approve an assignment, sublease or other transfer of Lessee’s
interest in the Lease under Paragraph 12 of this Lease, any other defaults by Lessor, or any defaults by Lessee by and through arbitration
as provided below and irrevocably waive any and all rights to the contrary. The Parties agree to at all times conduct themselves in strict,
full, complete and timely accordance with the terms hereof and that any attempt to circumvent the terms of this Arbitration Agreement
shall be absolutely null and void and of no force or effect whatsoever.


 


B.
DISPUTES EXCLUDED FROM ARBITRATION:


 


The
following claims, disputes or disagreements under this Lease are expressly excluded from the arbitration procedures set forth herein:
1. Disputes for which a different resolution determination is specifically set forth in this Lease, 2. All claims by either
party which (a) seek anything other than enforcement or determination of rights under this Lease, or (b) are primarily founded upon matters
of fraud, willful misconduct, bad faith or any other allegations of tortious action, and seek the award of punitive or exemplary damages,
3. Claims relating to (a) Lessor’s exercise of any unlawful detainer rights pursuant to applicable law or (b) rights or remedies
used by Lessor to gain possession of the Premises or terminate Lessee’s right of possession to the Premises, all of which disputes
shall be resolved by suit filed in the applicable court of jurisdiction, the decision of which court shall be subject to appeal
pursuant to applicable law 4. Any claim or dispute that is within the jurisdiction of the Small Claims Court and


 


5.
All claims arising under Paragraph 39 of this Lease.


 


C.
APPOINTMENT OF AN ARBITRATOR:


 


All
disputes subject to this Arbitration Agreement, shall be determined by binding arbitration before☒:
a retired judge of the applicable court of jurisdiction (e.g., the Superior Court of the State of California) affiliated with Judicial
Arbitration & Mediation Services, Inc. (“JAMS”), ☐ the American Arbitration Association (“AAA”)
under its commercial arbitration rules, ☐__________, or as may be otherwise mutually agreed by Lessor and Lessee (the “Arbitrator”).
In the event that the parties elect to use an arbitrator other than one affiliated with JAMS or AAA then such arbitrator shall be
obligated to comply with the Code of Ethics for Arbitrators in Commercial Disputes (see: http://www.adr.org/aaa/ShowProperty?nodeId=/UCM/ADRSTG_003867).
Such arbitration shall be initiated by the Parties, or either of them, within ten (10) days after either party sends written notice (the
“Arbitration Notice”) of a demand to arbitrate by registered or certified mail to the other party and to the
Arbitrator. The Arbitration Notice shall contain a description of the subject matter of the arbitration, the dispute with respect thereto,
the amount involved, if any, and the remedy or determination sought. If the Parties have agreed to use JAMS they may agree on a retired
judge from the JAMS panel. If they are unable to agree within ten days, JAMS will provide a list of three available judges and each party
may strike one. The remaining judge (or if there are two, the one selected by JAMS) will serve as the Arbitrator. If the Parties have
elected to utilize AAA or some other organization, the Arbitrator shall be selected in accordance with said organization’s rules.
In the event the Arbitrator is not selected as provided for above for any reason, the party initiating arbitration shall apply to the
appropriate Court for the appointment of a qualified retired judge to act as the Arbitrator.


 




    	 	 	 
	INITIALS	INITIALS	Page 30 of 34



     


    

 


D. ARBITRATION PROCEDURE:




 


1. PRE-HEARING
ACTIONS. The Arbitrator shall schedule a pre-hearing conference to resolve procedural matters, arrange for the exchange of
information, obtain stipulations, and narrow the issues. The Parties will submit proposed discovery schedules to the Arbitrator at
the pre-hearing conference. The scope and duration of discovery will be within the sole discretion of the Arbitrator. The Arbitrator
shall have the discretion to order a pre-hearing exchange of information by the Parties, including, without limitation, production
of requested documents, exchange of summaries of testimony of proposed witnesses, and examination by deposition of parties and
third-party witnesses. This discretion shall be exercised in favor of discovery reasonable under the circumstances. The Arbitrator
shall issue subpoenas and subpoenas duces tecum as provided for in the applicable statutory or case law (e.g., in California Code of
Civil Procedure Section 1282.6).


 


2. THE
DECISION. The arbitration shall be conducted in the city or county within which the Premises are located at a reasonably
convenient site. Any Party may be represented by counsel or other authorized representative. In rendering a decision(s), the
Arbitrator shall determine the rights and obligations of the Parties according to the substantive laws and the terms and provisions
of this Lease. The Arbitrator’s decision shall be based on the evidence introduced at the hearing, including all logical and
reasonable inferences therefrom. The Arbitrator may make any determination and/or grant any remedy or relief that is just and
equitable. The decision must be based on, and accompanied by, a written statement of decision explaining the factual and legal basis
for the decision as to each of the principal controverted issues. The decision shall be conclusive and binding, and it may
thereafter be confirmed as a judgment by the court of applicable jurisdiction, subject only to challenge on the grounds set
forth in the applicable statutory or case law (e.g., in California Code of Civil Procedure Section 1286.2). The validity and
enforceability of the Arbitrator’s decision is to be determined exclusively by the court of appropriate jurisdiction pursuant
to the provisions of this Lease. The Arbitrator may award costs, including without limitation, Arbitrator’s fees and costs,
attorneys’ fees, and expert and witness costs, to the prevailing party, if any, as determined by the Arbitrator in his
discretion.


 


Whenever
a matter which has been submitted to arbitration involves a dispute as to whether or not a particular act or omission (other than a failure
to pay money) constitutes a Default, the time to commence or cease such action shall be tolled from the date that the Notice of Arbitration
is served through and until the date the Arbitrator renders his or her decision. Provided, however, that this provision shall NOT apply
in the event that the Arbitrator determines that the Arbitration Notice was prepared in bad faith.


 


Whenever
a dispute arises between the Parties concerning whether or not the failure to make a payment of money constitutes a default, the service
of an Arbitration Notice shall NOT toll the time period in which to pay the money. The Party allegedly obligated to pay the money may,
however, elect to pay the money “under protest” by accompanying said payment with a written statement setting forth the reasons
for such protest. If thereafter, the Arbitrator determines that the Party who received said money was not entitled to such payment, said
money shall be promptly returned to the Party who paid such money under protest together with Interest thereon as defined in Paragraph
13.5. If a Party makes a payment “under protest” but no Notice of Arbitration is filed within thirty days, then such
protest shall be deemed waived. (See also Paragraph 42 or 43)


 


AIR
CRE * https://www.aircre.com * 213-687-8777 * contracts@aircre.com


NOTICE:
No part of these works may be reproduced in any form without permission in writing.


Submersible
Systems-7413 Slater Avenue-Gross Lease


 




    	 	 	 
	INITIALS	INITIALS	Page 31 of 34



     


    

 





 


GUARANTY
OF LEASE


 


WHEREAS,
Slater Palms, LLC, hereinafter “Lessor”, and Submersible Systems, Inc., a Florida corporation,
hereinafter “Lessee”, are about to execute a document entitled “Lease” dated September 14, 2022 concerning
the premises commonly known as (street address, city, state, zip) 7413 Slater Avenue, Huntington Beach, CA 92647 wherein Lessor will lease the premises to Lessee, and


 


WHEREAS,
Brownie’s Marine Group, Inc. hereinafter “Guarantors” have a financial interest in Lessee, and


 


WHEREAS,
Lessor would not execute the Lease if Guarantors did not execute and deliver to Lessor this Guaranty of Lease.


 


NOW
THEREFORE, in consideration of the execution of said Lease by Lessor and as a material inducement to Lessor to execute said Lease, Guarantors
hereby jointly, severally, unconditionally and irrevocably guarantee the prompt payment by Lessee of all rents and all other sums payable
by Lessee under said Lease and the faithful and prompt performance by Lessee of each and every one of the terms, conditions and covenants
of said Lease to be kept and performed by Lessee.


 


It
is specifically agreed by Lessor and Guarantors that: (i) the terms of the foregoing Lease may be modified by agreement between
Lessor and Lessee, or by a course of conduct, and (ii) said Lease may be assigned by Lessor or any assignee of Lessor without the consent
of or notice to Guarantors and that this Guaranty shall guarantee the performance of said Lease as so modified.


 


This
Guaranty shall not be released, modified or affected by the failure or delay on the part of Lessor to enforce any of the rights
or remedies of the Lessor under said Lease.


 


No
notice of default by Lessee under the Lease need be given by Lessor to Guarantors, it being specifically agreed that the guarantee
of the undersigned is a continuing guarantee under which Lessor may proceed immediately against Lessee and/or against Guarantors following
any breach or default by Lessee or for the enforcement of any rights which Lessor may have as against Lessee under the terms of the Lease
or at law or in equity.


 


Lessor
shall have the right to proceed against Guarantors following any breach or default by Lessee under the Lease without first proceeding
against Lessee and without previous notice to or demand upon either Lessee or Guarantors.


 


Guarantors
hereby waive (a) notice of acceptance of this Guaranty. (b) demand of payment, presentation and protest, (c) all right to assert or plead
any statute of limitations relating to this Guaranty or the Lease, (d) any right to require the Lessor to proceed against the Lessee
or any other Guarantor or any other person or entity liable to Lessor, (e) any right to require Lessor to apply to any default any security
deposit or other security it may hold under the Lease, (f) any right to require Lessor to proceed under any other remedy Lessor may have
before proceeding against Guarantors, (g) any right of subrogation that Guarantors may have against Lessee.


 


Guarantors
do hereby subordinate all existing or future indebtedness of Lessee to Guarantors to the obligations owed to Lessor under the Lease and
this Guaranty.


 


If
a Guarantor is married, such Guarantor expressly agrees that recourse may be had against his or her separate property for all of the
obligations hereunder.


 


The
obligations of Lessee under the Lease to execute and deliver estoppel statements and financial statements, as therein provided,
shall be deemed to also require the Guarantors to provide estoppel statements and financial statements to Lessor. The failure of
the Guarantors to provide the same to Lessor shall constitute a default under the Lease.


 


The
term “Lessor” refers to and means the Lessor named in the Lease and also Lessor’s successors and assigns. So long as
Lessor’s interest in the Lease, the leased premises or the rents, issues and profits therefrom, are subject to any mortgage
or deed of trust or assignment for security, no acquisition by Guarantors of the Lessor’s interest shall affect the continuing
obligation of Guarantors under this Guaranty which shall nevertheless continue in full force and effect for the benefit of
the mortgagee, beneficiary, trustee or assignee under such mortgage, deed of trust or assignment and their successors and assigns.


 



    	 	 	 
	INITIALS	INITIALS	Page 32 of 34



     


    

 


The
term “Lessee” refers to and means the Lessee named in the Lease and also Lessee’s successors and assigns.


 


Any
recovery by Lessor from any other guarantor or insurer shall first be credited to the portion of Lessee’s indebtedness to
Lessor which exceeds the maximum liability of Guarantors under this Guaranty.


 


No
provision of this Guaranty or right of the Lessor can be waived, nor can the Guarantors be released from their obligations except in
writing signed by the Lessor.


 


Any
litigation concerning this Guaranty shall be initiated in a state court of competent jurisdiction in the county in which the leased premises
are located and the Guarantors consent to the jurisdiction of such court. This Guaranty shall be governed by the laws of the State in
which the leased premises are located and for the purposes of any rules regarding conflicts of law the parties shall be treated
as if they were all residents or domiciles of such State.


 


In
the event any action be brought by said Lessor against Guarantors hereunder to enforce the obligation of Guarantors hereunder, the unsuccessful
party in such action shall pay to the prevailing party therein a reasonable attorney’s fee. The attorney’s fee award shall
not be computed in accordance with any court fee schedule, but shall be such as to full reimburse all attorneys’ fees reasonably
incurred.


 


If
any Guarantor is a corporation, partnership, or limited liability company, each individual executing this Guaranty on said entity’s
behalf represents and warrants that he or she is duly authorized to execute this Guaranty on behalf of such entity. Signatures to this
Guaranty accomplished by means of electronic signature or similar technology shall be legal and binding.


 


If
this Form has been filled in, it has been prepared for submission to your attorney for his approval. No representation or recommendation
is made BY AIR CRE, the real estate broker or its agents or employees as to the legal sufficiency, legal effect, or tax consequences
of this Form or the transaction relating thereto.


 


SIGNATURE
PAGE TO FOLLOW





 



    	 	 	 
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	GUARANTORS	 	 	Executed At:	Pompano Beach, FL



 


	Brownie’s
    Marine Group, Inc.	 	On:	September
    30, 2022 | 12:35 PM PDT
	 	 	 	 	 
	By:	 	 	By:	 
	Name
    Printed:	Christopher
    Constable	 	Name
    Printed:	 
	Title:	Chief
    Executive Officer	 	Title:	 
	Address:	 	 	Address:	 








 


AIR CRE * https://www.aircre.com * 213-687-8777 * contracts@aircre.com


NOTICE: No part of these works may be reproduced in any form without
permission in writing.


Schneider/Submersible Systems-7413 Slater-Guaranty of Lease


 





    	 	 	 
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