STANDARD
INDUSTRIAL/COMMERCIAL SINGLE-TENANT LEASE - NET 

(DO NOT USE THIS FORM FOR MULTI-TENANT BUILDINGS)


 


	1.	Basic Provisions (“Basic Provisions”).




 


1.1
Parties. This Lease (“Lease”), dated for reference purposes only September 20, 2017 , is made by
and between Corbiz, LLC, a California limited liability company (“Lessor”) and Hancock Jaffe Laboratories,
Inc., a Delaware corporation (“Lessee”), (collectively the “Parties,” or individually a
“Party”).


 


1.2
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, city, state, zip): 70 Doppler, Irvine, CA 92618 (“Premises”).
The Premises are located in the County of Orange , and are generally described as (describe briefly the nature of the property
and , if applicable, the “Project,” if the property is located within a Project): An approximate 14,507 square
foot industrial building. (See also Paragraph 2)


 


1.3
Term: five (5) years and zero (0) months (“Original Term”) commencing October 1, 2017
(“Commencement Date”) and ending September 30, 2022 (“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: $26,838.00 per month (“Base Rent”), payable on the first (1st) day of each month
commencing October 1, 2017 . (See also Paragraph 4)


 


[X]
If this box is checked, there are provisions in this Lease for the Base Rent to be adjusted. See Paragraph 53.


 


1.6
Base Rent and Other Monies Paid Upon Execution:


 


	 	(a)	Base
Rent: $26,838.00 for the period October 1-31, 2017.
	 	 	 
	 	(b)	Security
    Deposit: $26,112.60 (“Security Deposit”). (See also Paragraph 5)
	 	 	 
	 	(c)	Association
    Fees: $0.00 for the period N/A.
	 	 	 
	 	(d)	Other:
    $7,254.00 for estimated operating expenses for October 1-31, 2017.
	 	 	 
	 	(e)	Total
    Due Upon Execution of this Lease: $961.37 (see Addendum).


 


1.7
Agreed Use: Research and development of heart valves and related uses . (See also Paragraph 6)


 


1.8
Insuring Party. Lessor is the “Insuring Party” unless otherwise stated herein. (See also Paragraph 8)


 


1.9
Real Estate Brokers. (See also Paragraph 15 and 25)


 


(a)
Representation: The following real estate brokers (the “Brokers”) and brokerage relationships exist in
this transaction (check applicable boxes):


 


[X]
Lee & Associates®-Newport Beach (Jeff Hirsch) represents Lessor exclusively (“Lessor’s Broker”);


 


[  ]
N/A represents Lessee exclusively (“Lessee’s Broker”); or


 


[  ]
N/A represents both Lessor and Lessee (“Dual Agency”).


 


(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.


 


1.10
Guarantor. The obligations of the Lessee under this Lease are to be guaranteed by______ (“Guarantor”). (See
also Paragraph 37)


 



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1.11
 Attached hereto are the following, all of which constitute a part of this Lease:


 


[X]
an Addendum consisting of Paragraphs 51 through 55;


 


[  ]
a plot plan depicting the Premises;


 


[  ]
a current set of the Rules and Regulations;


 


[  ]
a Work Letter;


 


[X]
other (specify): Rent Adjustments (54) and Option(s) to Extend (55).


 










	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 the Premises 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 Premises, 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 any buildings
on the Premises (the “Building”) shall be free of material defects, and that the Premises do not contain hazardous
levels of any mold or fungi defined as toxic under applicable state or federal law. If a non-compliance with said 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 Building. 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. 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 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
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 an 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.


 






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(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.


 







(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, however, 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.


 


	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 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 its best commercially reasonable efforts to deliver 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.


 






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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.


 


	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
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 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, Insurance and
Real Property Taxes, and any remaining amount to any other outstanding charges or costs.


 








4.3
Association Fees. In addition to the Base Rent, Lessee shall pay to Lessor each month an amount equal to any owner’s association
or condominium fees levied or assessed against the Premises. Said monies shall be paid at the same time and in the same manner
as the Base Rent.


 


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 improvements on the premises or the mechanical or electrical systems
therein, and/or is not significantly more burdensome to the Premises. 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 adjacent properties 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 result from Hazardous Substances which existed on the Premises prior to Lessee’s occupancy 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 Lessee’s occupancy, 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. In addition, Lessee shall
provide copies of all relevant material safety data sheets (MSDS) to Lessor within 10 days of the receipt of a written
request therefor. In addition, Lessee shall provide Lessor with copies of its business license, certificate of occupancy and/or
any similar document within 10 days of the receipt of a written request therefor.


 










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) 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 a 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, fire protection system, fixtures,
walls (interior and exterior), foundations, ceilings, roofs, roof drainage systems, floors, windows, doors, plate glass, skylights,
landscaping, driveways, parking lots, fences, retaining walls, signs, sidewalks and parkways located in, on, or adjacent to the
Premises. 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. Lessee shall, during the term of this Lease, keep the exterior appearance
of the Building in a first-class condition (including, e.g. graffiti removal) consistent with the exterior appearance of
other similar facilities of comparable age and size in the vicinity, including, when necessary, the exterior repainting of the
Building.


 









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(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, (iii) fire extinguishing
systems, including fire alarm and/or smoke detection, (iv) landscaping and irrigation systems, (v) roof covering and drains, and
(vi) 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.


 


(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, 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 (ie.
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), 9 (Damage or Destruction)
and 14 (Condemnation), it is intended by the Parties hereto that Lessor have no obligation, in any manner whatsoever, to repair
and maintain the Premises, or the equipment therein, all of which obligations are intended to be that of the Lessee. It is the
intention of the Parties that the terms of this Lease govern the respective obligations of the Parties as to maintenance and repair
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.





 



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(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.


 


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, 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 For Insurance. Lessee shall pay for all insurance required under Paragraph 8 except to the extent of the cost attributable
to liability insurance carried by Lessor under Paragraph 8.2(b) in excess of $2,000,000 per occurrence. Premiums for policy periods
commencing prior to or extending beyond the Lease term shall be prorated to correspond to the Lease term. Payment shall be made
by Lessee to Lessor within 10 days following receipt of an invoice.


 






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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.


 


8.3
Property Insurance - Building, Improvements and
Rental Value.


 


(a)
Building and Improvements. The Insuring Party shall obtain and keep in force a policy or policies 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, and Lessee shall be liable for such deductible amount in the event
of an Insured Loss.


 


(b)
Rental Value. The Insuring Party shall 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. Lessee shall be liable for any deductible amount in the event of such loss.


 


(c)
Adjacent Premises. If the Premises are part of a larger building, or of a group of buildings owned by Lessor which are
adjacent to the Premises, the Lessee shall pay for any increase in the premiums for the property insurance of such building or
buildings if said increase is caused by Lessee’s acts, omissions, use or occupancy of the Premises.


 


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.


 



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(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.


 


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, the use and/or occupancy of the Premises by Lessee. 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 of which the Premises are a part, 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 6 months or less from the date of the damage
or destruction. 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.





 



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(b)
“Premises Total Destruction” shall mean damage or destruction to the Premises, other than Lessee Owned Alterations
and Utility Installations and Trade Fixtures, which cannot reasonably be repaired in 6 months or less from the date of the damage
or destruction. 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.


 


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 (except as to the deductible which is Lessee’s responsibility)
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, 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.





 



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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.


 


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
Definition. 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 Premises
or 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 Building address. 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 Premises, and (ii) levied or assessed on machinery
or equipment provided by Lessor to Lessee pursuant to this Lease.


 





10.2
Payment of Taxes. In addition to Base Rent, Lessee shall pay to Lessor an amount equal to the Real Property Tax installment
due at least 20 days prior to the applicable delinquency date. If any such installment shall cover any period of time prior to
or after the expiration or termination of this Lease, Lessee’s share of such installment shall be prorated. In the event Lessee
incurs a late charge on any Rent payment, Lessor may estimate the current Real Property Taxes, and require that such taxes be
paid in advance to Lessor by Lessee monthly in advance with the payment of the Base Rent. Such monthly payments shall be an amount
equal to the amount of the estimated installment of taxes divided by the number of months remaining before the month in which
said installment becomes delinquent. When the actual amount of the applicable tax bill is known, the amount of such equal monthly
advance payments shall be adjusted as required to provide the funds needed to pay the applicable taxes. If the amount collected
by Lessor is insufficient to pay such Real Property Taxes when due, Lessee shall pay Lessor, upon demand, such additional sum
as is necessary. Advance payments may be intermingled with other moneys of Lessor and shall not bear interest. In the event of
a Breach by Lessee in the performance of its obligations under this Lease, then any such advance payments may be treated by Lessor
as an additional Security Deposit.


 


10.3
Joint Assessment. If the Premises are not separately assessed, Lessee’s liability 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 conclusively
determined by Lessor from the respective valuations assigned in the assessor’s work sheets or such other information as may be
reasonably available.





 



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10.4
Personal Property Taxes. Lessee shall pay, prior to delinquency, all taxes assessed against and levied upon Lessee Owned
Alterations, Utility Installations, Trade Fixtures, furnishings, equipment and all personal property of Lessee. 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.


 


11.
Utilities and Services. 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. If any such services are not separately
metered or billed to Lessee, Lessee shall pay a reasonable proportion, to be determined by Lessor, of all charges jointly metered
or billed. 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.


 


	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 noncurable Breach without the necessity of any notice and grace period. If Lessor elects to treat such unapproved assignment
or subletting as a noncurable 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.


 


(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 payphone 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.





 



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(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.


 


	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:





 



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(a)
The abandonment of the Premises; or the vacating of the Premises 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.


 


(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
42, (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
40 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.


 


(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:





 



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(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.


 


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.





 



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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 seek 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.


 


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 Building, or
more than 25% of that portion of the Premises not occupied by any building, 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 1.9 above, Lessor agrees that: (a) if Lessee
exercises any Option, (b) if Lessee or anyone affiliated with Lessee acquires any rights to the Premises or other premises owned
by Lessor and located within the same Project, if any, within which the Premises is located, (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.


 


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 1.9, 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.


 






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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 or finder (other than the Brokers, if any) in connection with this Lease,
and that no one other than said named Brokers 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.


 


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.


 






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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.


 


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.


 




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(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 that
the Lessor will accept rent in an amount less than that indicated in the listing or that the Lessee is willing to pay a higher
rent than that 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.


 


(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.


 


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. In the event that Lessee holds over, then the Base Rent shall be increased to 150% of the Base Rent
applicable immediately preceding the expiration or termination. Holdover Base Rent shall be calculated on monthly basis. Nothing
contained herein shall be construed as consent by Lessor to any holding over by Lessee.





 



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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.


 


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, Lessee shall not place
any sign upon the Premises 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, and each
such Guarantor shall have the same obligations as Lessee under this Lease.





 



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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.


 








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.
 Multiple Buildings. If the Premises are a part of a group of buildings controlled by Lessor, Lessee agrees that it will abide
by and conform to all reasonable rules and regulations which Lessor may make from time to time for the management, safety, and
care of said properties, including the care and cleanliness of the grounds and including the parking, loading and unloading of
vehicles, and to cause its employees, suppliers, shippers, customers, contractors and invitees to so abide and conform. Lessee
also agrees to pay its fair share of common expenses incurred in connection with such rules and regulations.


 


41.
 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.





 



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42.
 Reservations. Lessor reserves to itself the right, from time to time, to grant, without the consent or joinder of Lessee,
such easements, rights and dedications that Lessor deems necessary, and to cause the recordation of parcel maps and restrictions,
so long as such easements, rights, dedications, maps and restrictions do not unreasonably interfere with the use of the Premises
by Lessee. Lessee agrees to sign any documents reasonably requested by Lessor to effectuate any such easement rights, dedication,
map or restrictions.





 




43.
 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.


 


44.
 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.


 


45.
 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.


 


46.
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.


 








47.
 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.


 


48.
 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.


 


49.
 Arbitration of Disputes. An Addendum requiring the Arbitration of all disputes between the Parties and/or Brokers arising
out of this Lease [  ] is [X] is not attached to this Lease.


 


50.
 Accessibility; Americans with Disabilities Act.


 


(a)
The Premises:


 


[X]
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.





 



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[  ]
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.





 




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, 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: ____________	Executed
    at: ____________
	On:
    September 27, 2017	On:
    September 27, 2017


 











	By
    LESSOR:	By
    LESSEE:
	Corbiz,
    LLC, a California limited liability company 	Hancock
    Jaffe Laboratories, Inc., a Delaware corporation 
	 	 
	By:
    /s/ Alfonso G. Cordero	By:
    /s/ William R. Abbott
	Name
    Printed: Alfonso G. Cordero 	Name
    Printed: William R. Abbott 
	Title:
    Managing Member	Title:
    Senior Vice President/Chief Operating Officer 
	Phone:_____________	Phone:
    (949) 261-2900 
	Fax:_______________	Fax:
____________    
	Email:_____________	Email:
    billabbott@hjlinc.com





 



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	By:__________________________________________	By:________________________________________
	Name
    Printed: _____________	Name
    Printed: ____________
	Title:
    ___________ 	Title:___________
	Phone:
    (949) 553-0006 	Phone:___________
	Fax:
    (949) 553-0021 	Fax:____________
	Email:
    cnhcustomerservice@yahoo.com	Email:
    __________________ 
	 	 
	Address:
    17531 Von Karman Avenue, Irvine, CA 92614 	Address:
    70 Doppler, Irvine, CA 92618 
	Federal
    ID No.:________	Federal
    ID No.: _________


 


	BROKER	BROKER
	 	
	Lee
    & Associates®-Newport Beach	_______________
	 	 
	Attn:
    Jeff Hirsch 	Attn:___________
	Title:
    Senior Vice President/Principal 	Title:__________
	 	 
	Address:
    100 Bayview Circle, Suite 600, Newport Beach, CA 92660 	Address:_______________
	Phone:
    (949) 724-4737 	Phone:__________
	Fax:
    (949) 623-6337 	Fax:___________
	Email:
    jhirsch@lee-associates.com 	Email:__________
	Federal
    ID No.: ___________	Federal
    ID No.:__________
	Broker/Agent
    BRE License #: 00972311 	Broker/Agent
    BRE License #:__________


 


AIR
CRE. 500 North Brand Blvd, Suite 900, Glendale, CA 91203, Tel 213-687-8777, Email contracts@aircre.com NOTICE: No part of these
works may be reproduced in any form without permission in writing.


Hirsch/Hancock Jaffe
Laboratories- 70 Dopper- Net Lease


 






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Addendum
to that Standard AIR Industrial/Commercial Single-Tenant Lease – Net 

Dated September 20, 2017





By
and Between Corbiz, LLC, a California limited liability company (“Lessor”) and 

Hancock Jaffe Laboratories, Inc., a
Delaware corporation (“Lessee”)





For
the Property Located at 70 Doppler, Irvine, CA 92618


 


The
following provisions are added to that certain printed Standard Industrial/Commercial Single- Tenant Lease – Net dated for
the reference purposes as of September 20, 2017. In the event of any conflict between the terms of the printed Lease and this
Addendum, the terms of this Addendum shall control.


 





	51.	Net
    Lease; Payment of Expenses by Lessee.



 


	 	51.1	The
    Base Rent to be paid by Lessee to Lessor is intended to be absolutely triple net. To the extent that Lessee does not directly
    contract for the provision of, and pay for, any services relating to the operation, maintenance and repair of the Premises,
    Lessee shall reimburse Lessor for the cost thereof on a triple net basis. In addition, Lessee shall reimburse Lessor for the
    cost of its property manager, or if there is no property manager, shall pay Lessor administrative rent of two percent (2%)
    of Rent for management of the Premises. Finally, Lessee shall reimburse Lessor for any bond assessments paid by Lessor for
    the Premises.
	 	 	 
	 	51.2	Lessee
    shall pay Lessor for any expenses required to be paid by Lessor under this Lease for which Lessee is required to pay or reimburse
    Lessor (“Expenses”), including, without limitation, insurance under Paragraph 8.1 and Real
    Property Taxes under Paragraph 10 by paying to Lessor a monthly installment equal to one-twelfth (1/12th) of
    Lessor’s estimate of such Expenses, which estimate Lessor may revise during the calendar by written notice to Lessee.
    After its receipt of the revised estimate, Lessee’s monthly payments shall be based upon the revised estimate. If Lessor
    does not provide Lessee with an estimate of such Expenses by January 1 of a calendar year, Lessee shall continue to pay monthly
    installments based on the previous year’s estimate(s) until Lessor provides Lessee with the new estimate.







 


	52.	Paragraph
    1.6(e).




 


Lessor
is in possession of a portion of October 2017’s rent payment and security deposit. Lessee shall pay the sum of $961.37 for
shortage in October’s rent payment.





 


	53.	Estimated
    Monthly Payments.





 


	Base
    Rent:	 	$	26,838.00	 
	Estimated
    Operating Expenses:	 	$	7,254.00	 
	Total
    Monthly Payment:	 	$	34,092.00	 





 



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RENT
ADJUSTMENT(S)





STANDARD
LEASE ADDENDUM


 


	 	Dated:	September
    20, 2017
	 	By
    and Between	 
	 	Lessor:	Corbiz,
    LLC, a California limited liability company 
	 	Lessee:	Hancock
    Jaffe Laboratories, Inc., a Delaware corporation
	 	Property
    Address:	70
    Doppler, Irvine, CA 92618
	 		(street
    address, city, state, zip)


 


Paragraph:
54


 


A.
RENT ADJUSTMENTS:


 


The
monthly rent for each month of the adjustment period(s) specified below shall be increased using the method(s) indicated below:
(Check Method(s) to be Used and Fill in Appropriately)


 


[  ]
I. Cost of Living Adjustment(s) (COLA)


 


a.
On (Fill in COLA Dates):_______ the Base Rent shall be adjusted by the change, if any, from the Base Month specified below, in
the Consumer Price Index of the Bureau of Labor Statistics of the U.S. Department of Labor for (select one): [  ] CPI
W (Urban Wage Earners and Clerical Workers) or [  ] CPI U (All Urban Consumers), for (Fill in Urban Area): ________,
All Items (1982-1984 = 100), herein referred to as “CPI”.


 


b.
The monthly Base Rent payable in accordance with paragraph A.I.a. of this Addendum shall be calculated as follows: the Base Rent
set forth in paragraph 1.5 of the attached Lease, shall be multiplied by a fraction the numerator of which shall be the CPI of
the calendar month 2 months prior to the month(s) specified in paragraph A.I.a. above during which the adjustment is to take effect,
and the denominator of which shall be the CPI of the calendar month which is 2 [  ] months prior to (select one): the
first month of the term of this Lease as set forth in paragraph 1.3 (“Base Month”) or [  ] (Fill in Other
“Base Month”):


 


_________.
The sum so calculated shall constitute the new monthly Base Rent hereunder, but in no event, shall any such new monthly Base Rent
be less than the Base Rent payable for the month immediately preceding the Base Rent adjustment.


 


c.
In the event the compilation and/or publication of the CPI shall be transferred to any other governmental department or bureau
or agency or shall be discontinued, then the index most nearly the same as the CPI shall be used to make such calculation. In
the event that the Parties cannot agree on such alternative index, then the matter shall be submitted for decision to the American
Arbitration Association in accordance with the then rules of said Association and the decision of the arbitrators shall be binding
upon the parties. The cost of said Arbitration shall be paid equally by the Parties.


 


[  ]
II. Market Rental Value Adjustment(s) (MRV)


 


a.
On (Fill in MRV Adjustment Date(s):________ the Base Rent shall be adjusted to the “Market Rental Value” of the property
as follows:


 


1)
Four months prior to each Market Rental Value Adjustment Date described above, the Parties shall attempt to agree upon what the
new MRV will be on the adjustment date. If agreement cannot be reached within thirty days, then:


 


(a)
Lessor and Lessee shall immediately appoint a mutually acceptable appraiser or broker to establish the new MRV within the next
30 days. Any associated costs will be split equally between the Parties, or


 


(b)
Both Lessor and Lessee shall each immediately make a reasonable determination of the MRV and submit such determination, in writing,
to arbitration in accordance with the following provisions:


 






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(i)
Within 15 days thereafter, Lessor and Lessee shall each select an independent third party [  ] appraiser or [  ]
broker (“Consultant”− check one) of their choice to act as an arbitrator (Note: the parties may not select either
of the Brokers that was involved in negotiating the Lease). The two arbitrators so appointed shall immediately select a third
mutually acceptable Consultant to act as a third arbitrator.


 


(ii)
The 3 arbitrators shall within 30 days of the appointment of the third arbitrator reach a decision as to what the actual MRV for
the Premises is, and whether Lessor’s or Lessee’s submitted MRV is the closest thereto. The decision of a majority of the arbitrators
shall be binding on the Parties. The submitted MRV which is determined to be the closest to the actual MRV shall thereafter be
used by the Parties.


 


(iii)
If either of the Parties fails to appoint an arbitrator within the specified 15 days, the arbitrator timely appointed by one of
them shall reach a decision on his or her own, and said decision shall be binding on the Parties.


 


(iv)
The entire cost of such arbitration shall be paid by the party whose submitted MRV is not selected, i.e., the one that is NOT
the closest to the actual MRV.





 







2)
When determining MRV, the Lessor, Lessee and Consultants shall consider the terms of comparable market transactions which shall
include, but no limited to, rent, rental adjustments, abated rent, lease term and financial condition of tenants.


 


3)
Notwithstanding the foregoing, the new Base Rent shall not be less than the rent payable for the month immediately preceding the
rent adjustment.


 





	 	b.	Upon
    the establishment of each New Market Rental Value:


 


	 	1)	the
    new MRV will become the new “Base Rent” for the purpose of calculating any further Adjustments, and
	 	 	 
	 	2)	the
    first month of each Market Rental Value term shall become the new ‘Base Month’ for the purpose of calculating any further
    Adjustments.


 








[X]
III. Fixed Rental Adjustment(s) (FRA)


 


The
Base Rent shall be increased to the following amounts on the dates set forth below:


 


	On
    (Fill in FRA Adjustment Date(s)):	The
    New Base Rent shall be:
	October
    1, 2018 	$27,643.00
    
	October
    1, 2019 	$28,472.00
    
	October
    1, 2020 	$29,327.00
    
	October
    1, 2021 	$30,206.00
    
	________	_______
	________	_______
	________	_______
	________	_______
	________	_______
	________	_______


 


AIR
CRE. 500 North Brand Blvd, Suite 900, Glendale, CA 91203, Tel 213-687-8777, Email contracts@aircre.com NOTICE: No part of these
works may be reproduced in any form without permission in writing.


Hirsch/Hancock
Jaffe Laboratories- 70 Dopper- Net Lease


 









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________
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OPTION(S)
TO EXTEND


STANDARD
LEASE ADDENDUM


 


	 	Dated:	September
    20, 2017
	 	By
    and Between	 
	 	Lessor:	Corbiz,
    LLC, a California limited liability company 
	 	Lessee:	Hancock
    Jaffe Laboratories, Inc., a Delaware corporation
	 	Property
    Address:	70
    Doppler, Irvine, CA 92618
	 		(street
    address, city, state, zip)


 


Paragraph:
55 


 


A.
OPTION(S) TO EXTEND:


 


Lessor
hereby grants to Lessee the option to extend the term of this Lease for one (1) additional sixty (60) month period(s)
commencing when the prior term expires upon each and all of the following terms and conditions:


 


(i)
In order to exercise an option to extend, Lessee must give written notice of such election to Lessor and Lessor must receive the
same at least__________ but not more than________ months prior to the date that the option period would commence, time being of
the essence. If proper notification of the exercise of an option is not given and/or received, such option shall automatically
expire. Options (if there are more than one) may only be exercised consecutively.


 


(ii)
The provisions of paragraph 39, including those relating to Lessee’s Default set forth in paragraph 39.4 of this Lease, are conditions
of this Option.


 


(iii)
Except for the provisions of this Lease granting an option or options to extend the term, all of the terms and conditions of this
Lease except where specifically modified by this option shall apply.


 


(iv)
This Option 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 without the intention of thereafter assigning or
subletting.


 


(v)
The monthly rent for each month of the option period shall be calculated as follows, using the method(s) indicated below: (Check
Method(s) to be Used and Fill in Appropriately)





 







[  ]
I. Cost of Living Adjustment(s) (COLA)


 


a.
On (Fill in COLA Dates):_______ the Base Rent shall be adjusted by the change, if any, from the Base Month specified below, in
the Consumer Price Index of the Bureau of Labor Statistics of the U.S. Department of Labor for (select one): [  ] CPI
W (Urban Wage Earners and Clerical Workers) or [  ] CPI U (All Urban Consumers), for (Fill in Urban Area):________ .
All Items (1982-1984 = 100), herein referred to as “CPI”.


 


b.
The monthly Base Rent payable in accordance with paragraph A.I.a. of this Addendum shall be calculated as follows: the Base Rent
set forth in paragraph 1.5 of the attached Lease, shall be multiplied by a fraction the numerator of which shall be the CPI of
the calendar month 2 months prior to the month(s) specified in paragraph A.I.a. above during which the adjustment is to take effect,
and the denominator of which shall be the CPI of the calendar month which is 2 months prior to (select one): [  ] the
first month of the term of this Lease as set forth in paragraph 1.3 (“Base Month”) or [  ] (Fill in Other
“Base Month”):________ . The sum so calculated shall constitute the new monthly Base Rent hereunder, but in no event,
shall any such new monthly Base Rent be less than the Base Rent payable for the month immediately preceding the rent adjustment.





 


c.
In the event the compilation and/or publication of the CPI shall be transferred to any other governmental department or bureau
or agency or shall be discontinued, then the index most nearly the same as the CPI shall be used to make such calculation. In
the event that the Parties cannot agree on such alternative index, then the matter shall be submitted for decision to the American
Arbitration Association in accordance with the then rules of said Association and the decision of the arbitrators shall be binding
upon the parties. The cost of said Arbitration shall be paid equally by the Parties.


 






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[X]
II. Market Rental Value Adjustment(s) (MRV)


 


a.
On (Fill in MRV Adjustment Date(s)) October 1, 2022 the Base Rent shall be adjusted to the “Market Rental Value”
of the property as follows:


 


1)
Four months prior to each Market Rental Value Adjustment Date described above, the Parties shall attempt to agree upon what the
new MRV will be on the adjustment date. If agreement cannot be reached, within thirty days, then:


 


(a)
Lessor and Lessee shall immediately appoint a mutually acceptable appraiser or broker to establish the new MRV within the next
30 days. Any associated costs will be split equally between the Parties, or


 


(b)
Both Lessor and Lessee shall each immediately make a reasonable determination of the MRV and submit such determination, in writing,
to arbitration in accordance with the following provisions:


 


(i)
Within 15 days thereafter, Lessor and Lessee shall each select an independent third party [  ] appraiser or [  ]
broker (“Consultant” - check one) of their choice to act as an arbitrator (Note: the parties may not select either of
the Brokers that was involved in negotiating the Lease). The two arbitrators so appointed shall immediately select a third mutually
acceptable Consultant to act as a third arbitrator.


 


(ii)
The 3 arbitrators shall within 30 days of the appointment of the third arbitrator reach a decision as to what the actual MRV for
the Premises is, and whether Lessor’s or Lessee’s submitted MRV is the closest thereto. The decision of a majority of the arbitrators
shall be binding on the Parties. The submitted MRV which is determined to be the closest to the actual MRV shall thereafter be
used by the Parties.


 


(iii)
If either of the Parties fails to appoint an arbitrator within the specified 15 days, the arbitrator timely appointed by one of
them shall reach a decision on his or her own, and said decision shall be binding on the Parties.


 


(iv)
The entire cost of such arbitration shall be paid by the party whose submitted MRV is not selected, ie. the one that is NOT the
closest to the actual MRV.





 



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2)
When determining MRV, the Lessor, Lessee and Consultants shall consider the terms of comparable market transactions which shall
include, but not limited to, rent, rental adjustments, abated rent, lease term and financial condition of tenants.


 


3)
Notwithstanding the foregoing, the new Base Rent shall not be less than the rent payable for the month immediately preceding the
rent adjustment.


 








	 	b.	Upon
    the establishment of each New Market Rental Value:


 


	 	1)	the
    new MRV will become the new “Base Rent” for the purpose of calculating any further Adjustments, and
	 	 	 
	 	2)	the
    first month of each Market Rental Value term shall become the new “Base Month” for the purpose of calculating any
    further Adjustments.





 




[  ]
III. Fixed Rental Adjustment(s) (FRA)


 


The
Base Rent shall be increased to the following amounts on the dates set forth below:


 


	On
    (Fill in FRA Adjustment Date(s)):	The
    New Base Rent shall be:
	________	________
	________	________
	________	________
	________	________
	________	________
	________	________
	________	________
	________	________
	________	________
	________	________


 


[  ]
IV. Initial Term Adjustments


 


The
formula used to calculate adjustments to the Base Rate during the original Term of the Lease shall continue to be used during
the extended term.


 


B.
NOTICE:


 


Unless
specified otherwise herein, notice of any rental adjustments, other than Fixed Rental Adjustments, shall be made as specified
in paragraph 23 of the Lease.


 


C.
BROKER’S FEE:


 


The
Brokers shall be paid a Brokerage Fee for each adjustment specified above in accordance with paragraph 15 of the Lease or if applicable,
paragraph 9 of the Sublease.


 


AIR
CRE. 500 North Brand Blvd, Suite 900, Glendale, CA 91203, Tel 213-687-8777, Email contracts@aircre.com NOTICE: No part of these
works may be reproduced in any form without permission in writing.


Hirsch/Hancock
Jaffe Laboratories- 70 Dopper- Net Lease


 






    	________
________
INITIALS
 
	 
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