Document:

SEC Connect

 

Exhibit 10.5 

 

INTERCREDITOR AGREEMENT  

 

THIS
INTERCREDITOR AGREEMENT (the “Agreement”) is dated as
of February __, 2017, and is between “Agents” _____________,
with an address of _____________________, ________, and __________,
with an address of _____________________, ________, and
“Participant” or
“Participants” on Schedule
I attached hereto, with their address set forth opposite their
names.

 

In this
Agreement, the following terms shall have the following respective
meanings:

 

“Financing Documents”
means the Note Purchase Agreement, the Senior Secured Convertible
Promissory Notes, and all agreements, instruments and documents
referred to in the definition of “Financing” together
with all other agreements, instruments and documents executed and
delivered in connection with the Financing.

 

“Financing” means the
secured loan or loans made by Participants to FluoroPharma Medical,
Inc., a Nevada corporation (“Borrower”), pursuant to
the Senior Secured Convertible Notes in the aggregate amount of up
to $1,000,000 due February __, 2018 (the “Notes”), Security
Agreement, UCC-1 Financing Statements and other Financing
Documents.

 

“Participation” means the
interest of a party in the Financing.

 

“Participation Amount”
means the dollar amount of the respective Note of Borrower to each
Participant.

 

“Proportionate Share”
means each Participant’s percentage interest in the then
outstanding Notes.

 

“Pro Rata” means, in
reference to allocation of expenses or losses or to the application
or distribution of payments or other monies received in connection
with the Financing, in the same proportion of the applicable
parties’ interest in the Financing is to the entire
outstanding balance of the Financing at the date of such
allocation, application or distribution.

 

WHEREAS,
Participants have made the Financing; and

 

WHEREAS,
Participants desire to set forth the agreement between them with
respect to the Financing and the authorization of Agents acting on
behalf of all Participants.

 

NOW,
THEREFORE, in consideration of the mutual covenants and agreements
contained herein, Agents and Participants hereby agree as
follows:

 

1. Nature and Description of
Participation. No Participation shall have a priority
interest over any other Participation regardless when a Participant
becomes a party to this Agreement. Participant’s
Participation has no recourse to Agents, except to enforce the
provisions of this Agreement. Participant may not sell, assign,
transfer or otherwise dispose of its Participation (or any interest
therein) except in accordance with Section 5 of this Agreement. The
Financing is secured as provided in the Financing Documents, and
each Participation includes an undivided Pro Rata interest in all
collateral for the Financing, and all rights with respect thereto
on and after the date hereof. Notwithstanding anything to the
contrary contained in the Financing Documents, Participant hereby
acknowledges and agrees that the interest payable to Participant
after the date hereof on its Participation will be at the rate set
forth on Participant’s respective Note. Agents will not be
entitled to payment for their services hereunder.

 

 

 

 

2. Financing Administration.
Agents shall service and administer the Financing in their sole and
absolute discretion. Agents agree to employ reasonable commercial
practices in the administration of the Financing. Participant
hereby appoints Agents as Participant’s agent for purposes of
servicing and administration. In connection with such servicing and
administration, the following provisions shall apply:

 

(a) Upon written
request of Participant, Agents shall forward to Participant copies
of any other documents, instruments or certificates delivered to
them in connection with the Financing and all financial statements
and other information that they receive from Borrower;

 

(b) Borrower shall pay
all interest due and all payments of principal directly to
Participant in accordance with the Notes;

 

(c) Agents will not,
without the prior written consent of the holders of a majority in
outstanding principal of the Notes, (i) modify the interest rates,
maturities, or maximum amounts of the Notes; (ii) make or consent
to any release, substitution or exchange of any collateral obtained
pursuant to any Security Agreement; (iii) accelerate any of the
Notes; (iv) sell, assign or transfer any of said collateral (except
upon immediate remittance to each Participant of its Pro Rata
interest therein after deducting all expenses in connection
therewith); or (v) waive any claim against the Borrower or any
guarantor, standby creditor or obligor in connection with any of
the Financing. Agents are solely authorized to file additional,
amended or supplement Schedule I’s hereto and UCC Financing
Statements with the appropriate authorities to reflect additional
Participants or assignees of any Participant;

 

(d) Agents agree, to
the extent that Agents have actual knowledge thereof, to give
Participant reasonably prompt notification of the occurrence of any
material event of default under the Financing Documents (any such
material event of default or event being referred to herein as a
“Default”);

 

(e) Upon the occurrence
of a Default, Agents may, with the prior written consent of the
holders of a majority in outstanding principal of the Notes, which
consent shall not be unreasonably withheld, delayed or conditioned,
determine a course of action, if any, to be taken to cure such
Default or otherwise protect or enforce the rights of the Agents
and Participants. Each decision concerning the course of action to
be followed shall be made by Agents, with the prior written consent
of the holders of a majority in outstanding principal of the Notes,
which consent shall not be unreasonably withheld, delayed or
conditioned;

 

(f) Upon the occurrence
of a Default, Agents may, with the prior written consent of the
holders of a majority in outstanding principal of the Notes, which
consent shall not be unreasonably withheld, delayed or conditioned,
proceed, as agent for the parties hereto, to use any legal remedies
at their disposal to collect the Financing. The selection of such
remedies and the manner of exercise of its rights shall be as
determined by Agents, with the prior written consent of the holders
of a majority in outstanding principal of the Notes, which consent
shall not be unreasonably withheld, delayed or conditioned. All
sums received by Agents on account of the Financing in any
collection proceedings shall, after deducting the charges and
expenses thereof paid or to be paid by Agents, be paid within two
(2) business days, pro rata, to Participants;

 

(g) All payments made
by any party hereto shall be made in federal or other immediately
available funds, unless otherwise agreed by the parties; and
payments required to be made by any party may be delayed by such
party until it is in possession of cleared, immediately available
funds; and

 

(h) An Agent may resign
at any time upon thirty (30) days prior written notice to the
Participants, in which case the Participants may choose to select
one or more replacement Agent(s) upon vote of the holders of the
majority of the outstanding Participation Amount.

 

 

 

 

3. Application of Payments and
Expenses. Agents shall remit to Participants if, as and when
Agents shall have finally collected the same, Participant’s
Pro Rata share of all principal and interest payments made by
Borrower with respect to the Financing after the date hereof,
provided, however, interest payments to Participant shall be as set
forth in Section 3 hereunder. Any and all loss or losses with
respect to the Financing shall be borne by Participants on a pro
rata basis. All out-of-pocket expenses incurred by Agents in the
servicing and administration (including all costs of collection) of
the Financing shall be shared by and Participants on a pro rata
basis.

 

4. Liability and Representation.
Participant acknowledges that neither Agents nor any of their
officers, directors, employees or agents shall be liable for any
action taken hereunder or under the terms of the Financing, or in
connection herewith or therewith, unless caused by their lack of
good faith or willful misconduct. Agents shall not be responsible
for any recitals, statements, representations or warranties
contained in or in any instruments, agreement or other
documentation in connection with the Financing or thereby
contemplated or for the execution, effectiveness, genuineness,
validity or enforceability thereof, or be required to make any
inquiry concerning the performance or observance of any of the
terms, provisions or conditions thereof.

 

Participant
acknowledges that counsel to Borrower has served as counsel to
Borrower only, and such representation has not been and will not be
relied upon by Participant.

 

5. Assignment. In the event
Participant desires to assign its Notes and rights hereunder, it
shall deliver a written notification (the “Notification”) to Agents,
which shall include (i) the identity of the proposed assignee, (ii)
a complete and accurate description of the price, terms and
conditions of such proposed assignment and (iii) the written
assumption by assignee in form and substance satisfactory to Agents
and Borrower’s counsel whereby the assignee has assumed all
of the obligations and undertakings of Participant under this
Agreement, together with such opinions of counsel and other
supporting documentation as Agents or Borrower’s counsel may
reasonably require. Participant may not assign all or any part of
its Participation if such assignment has been objected to in
writing within ten (10) days after the date of the Notification.
Any assignment made or purported to be made in violation of this
Section shall be void ab initio and of no force and effect. As used
herein the term “assign” shall mean sell, assign,
transfer or otherwise dispose of any interest in the
Participation.

 

6. Setoff. If Participant realizes
any proceeds or monies from Borrower or holds, attaches or sets off
any deposits or credits of Borrower, Participant shall immediately
pay to Agents the entire amount thereof (without any deduction for
any reason, including without limitation other obligations, if any,
of Borrower to Participant) for application to the
Financing.

 

7. Contribution. In the event
that, at any time, Agents or Participant shall be sued or
threatened with suit by a trustee, receiver, assignee or similar
fiduciary on account of any alleged unlawful or voidable preference
or fraudulent transfer alleged to have been received from Borrower
on account of the Financing, or any transaction relating thereto,
then upon the occurrence of any such event, any monies paid in
satisfaction or compromise of such suit, claim or demand, or in
satisfying any prior lien asserted with respect to any of the
collateral and all expenses, costs and attorneys’ fees
incurred by any such party shall be paid by Participants on a pro
rata basis.

 

8. Notices. All notices required
or permitted hereunder shall be in writing and shall be deemed
given upon mailing by depositing the same in the U.S. mail, first
class postage prepaid, and addressed to the party being notified at
its Notice Address set forth at the beginning of this Agreement or
on Schedule I hereto.

 

9. Authorization; Applicable Laws;
Headings; Binding Effect; Entire Agreement; Counterparts.
Agents, Borrower and Participants hereby represent that each is
authorized to execute this Agreement and to participate in the
Financing upon the terms stated herein and in the Financing
Documents. This Agreement shall inure to and be binding upon the
successors and permitted assigns of the parties hereto, and shall
be construed in accordance with the laws of the State of Nevada.
The headings contained herein are for reference purposes only and
shall not affect in any way the meaning or interpretation of this
Agreement. This Agreement constitutes the entire agreement and
supersedes all prior agreements and understandings, both written
and oral, between the parties with respect to the subject matter
hereof. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original and all of
which, when taken together, shall constitute one and the same
agreement effective upon execution of a counterpart hereof on
behalf of each party hereto.

 

10. Other Participants.
Participants acknowledge that other holders of the Notes may become
parties hereto from time to time by executing a copy of this
Agreement, which shall be cosigned by Agents, without any further
action by the Participants then a party to this
Agreement.

 

 

 

IN
WITNESS WHEREOF, Borrower, Agents and each Participant have caused
this Agreement to be executed by their duly authorized officers as
of the date first above written, each as a sealed
instrument.

 

 

 

	

PARTICIPANTS:

	

BORROWER:

	
 

	
 

	
 

	

FLUOROPHARMA MEDICAL, INC.

	

____________________________________

	
 

	
 

	
 

	
 

	

By:
__________________________________

	
 

	
 

	

____________________________________

	
 

	
 

	
 

	
 

	

AGENTS:

	
 

	
 

	

____________________________________

	
 

	
 

	

_____________________________________

	
 

	
 

	
 

	
 

	

____________________________________

	
 

	
 

	

_____________________________________

	
 

	
 

 

 

 

 

 

SCHEDULE I

 

 

 

	

Name of Lender

 

	

Lender’s Address

 

	

Principal Amount of Note Due Lender

 

	
 

	
 

	

$__________

 

	
 

	
 

	

$__________

 

	
 

	
 

	

$__________

 

	
 

	
 

	

$__________

 

	

TOTAL

 

	
 

	

$__________djo-ex1045_216.htm

Exhibit 10.45

 

LEASE

ARTICLE 1.  LEASE  TERMS

 

	
 
	
1.1 
	
LANDLORD AND TENANT. This Lease ("Lease")  is entered into this 21st day of April,2016,  by and  between  Industrial  Equities Group, LLC,  a Minnesota  limited  liability company ("Landlord") and DJO, LLC, a Delaware limited liability company ("Tenant").
	
 

 

	
 
	
1.2 
	
PREMISES.   Landlord  hereby  rents,  leases,  lets and  demises  to Tenant  the following described property ("Premises"),  as illustrated on the site plan attached hereto as Exhibit A, approximately  34,316  rentable square feet (consisting  of approximately 2,616 square feet of warehouse space, approximately  31,556  square feet of office space and approximately 144 square feet of common area) located in a building (the "Building") commonly referred to as  Lakeview  Business  Campus III,  with a street address of 601 Campus Drive,  New Brighton,  Minnesota  55112   which   consists   of   approximately   46,970   square   feet ("Property").   A floor plan of the Premises is attached  as Exhibit B and a description  of improvements to be constructed is attached hereto as Exhibit C.
	
 

 

	
 
	
1.3 
	
LEASE   TERM.    The  term   of  this  Lease   shall   commence   on  October  1,  2016 ("Commencement  Date") and shall terminate December 31, 2023 unless sooner terminated as hereinafter provided.  In the event that Tenant does not vacate the Premises upon the expiration  or termination  of this Lease, Tenant shall  be deemed in default of this Lease, and  Landlord  may  commence  eviction  proceedings.    Notwithstanding  anything  in  this Lease to the contrary, Landlord shall have the option, in case of any such holding over, to convert the Lease term from a fixed term to a tenancy at will, in which case the term will continue and no eviction  proceedings commenced  until the tenancy at will is terminated. Whether or not Landlord opts to convert the term to a tenancy at will, Tenant will be liable, during  any holding  over  period, for  base rent in an amount  equal  to one and a quarter (1.25) times the Base Rent which would have been payable by Tenant had the holdover period been a part of the original term of this Lease, together with all additional  rent as provided in this Lease.  Because rent will accrue with respect to any holdover period in any event, no acceptance of rent by Landlord will be deemed an election to convert the term to a tenancy at will.  Rather, Landlord will have the right to bring eviction proceedings unless and until Landlord elects, by written notice, to convert the term to a tenancy at will.
	
 

 

Landlord hereby agrees that the Landlord's  Work shall be completed as evidenced  by the issuance of a City  issued Certificate  of Occupancy,  and delivery of possession  shall  be delivered to Tenant no later than October 1, 2016 (the "Outside Delivery and Completion Date").   Landlord hereby acknowledges and understands that (a) the Tenant is a party to a certain  lease agreement  (the "Tenant's Current  Lease"),  wherein the Tenant  is currently operating  at another  location (the "Tenant's Current  Location")  and (b) the execution  of this Lease (i) has resulted in the Tenant's  termination  of the Tenant's  Current Lease; and (ii)  will  result  in  the Tenant's relocation  of all  or  a  portion  of  its operations  from  the Tenant's Current  Location  to  the  Premises. As  a  result  of  the  foregoing,  Landlord acknowledges and understands that it is critical to the Tenant's  operations that early access to the Premises is granted to Tenant on August  1, 2016 and that the Landlord's  Work is completed  and that delivery  of possession occur  no later than the Outside  Delivery  and Completion  Date.  Accordingly, notwithstanding  anything to the contrary, (a) in the event that the Landlord fails to grant Tenant early access to the Premises by August 1, 2016 as contemplated  in Section 14.13 below; or (b) in the event that the Landlord's  Work has not been completed on or before the Outside Delivery and Completion Date or (c) in the event that delivery  of  possession  has not yet occurred  on or  before the Outside  Delivery  and Completion  Date, and provided that such delay was not caused by the Tenant, in addition to any other rights or remedies which are available to Tenant under this Lease and/or which are otherwise available to Tenant at law or in equity, Landlord shall be obligated to pay to the Tenant an amount which is equal to $2,600.00 per day.

 

 

 

 

 

	
 
	
1.4 
	
BASE RENT.  Base Rent is:
	
 

 

		
	
Months
	
Monthly Base Rent

	
October 1, 2016- December 31, 2016
	
$0.00

	
January 1, 2017- December 31,2017
	
$29,683.34

	
January 1, 2018- December 31, 2018
	
$30,277.01

	
January 1, 2019- December 31, 2019
	
$30,882.55

	
January 1, 2020- December 31, 2020
	
$31,500.20

	
January 1, 2021- December 31, 2021
	
$32,130.20

	
January 1, 2022- December 31, 2022
	
$32,772.81

	
January 1, 2023- December 31, 2023
	
$33,428.26

 

	
 
	
1.5 
	
PERMITTED USE.  Office, and Warehouse and related legal purposes and for such other purposes which may be incidental thereto and for any other lawful purpose.
	
 

 

	
 
	
1.6 
	
SECURITY DEPOSIT. $40,750.25.
	
 

 

	
 
	
1.7 
	
PRO  RATA SHARE. 73.06%
	
 

 

	
 
	
1.8 
	
PARKING.  One hundred and thirty (130) non-exclusive  parking stalls shall be provided (see Exhibit D).
	
 

 

	
 
	
1.9 
	
ADDRESSES.
	
 

 

Landlord's Address: Tenant's Address:

 

	
Industrial Equities Group LLC
	
DJO,LLC

	
c/o Industrial Equities LLP
	
1430 Decision Street

	
321 First Avenue North
	
Vista, CA 92081

	
Minneapolis, MN   55401
	
Attention:   Josh   Gao,   Sr.   Director   - Global 

	
 
	
Indirect Procurement

	
Phone:  612/332-1122
	
Phone: 760/734-3112

	
 
	
 

	
 
	
A copy of all non-routine or legal notices also shall be mailed or faxed to:

	
 
	
 

	
 
	
DJO,LLC

Attn: General Counsel

1430 Decision Street

Vista, CA 92018

Fax: (760) 734-3566

 

 

	
	
3

	
41905151-2

 

 

 

ARTICLE 2. RENT, OPERATING  EXPENSES AND SECURITY DEPOSIT, LATE CHARGES AND REPAYMENT OF FREE RENT

 

	
 
	
2.1 
	
BASE RENT.  Tenant agrees to pay monthly as Base Rent during the term of this Lease the sum  of money  set forth  in Section  1.4 of this Lease,  which  amount  shall  be payable  to Landlord at the address shown above.  One monthly installment shall be due and payable on or before the first day of each calendar month succeeding  the Commencement  Date during the term of this Lease; provided, if the Commencement  Date should be a date other than the first day of a calendar month, then the base rent shall be pro rated on a per diem basis, and all  succeeding  installments  of  rent  shall  be  payable  on  or  before  the  first  day  of  each succeeding  calendar  month during the term of this Lease.   Tenant shall pay, as additional rent, all other sums due under this Lease.   Notwithstanding  anything  in this Lease to the contrary,  if  Landlord,  for  any  reason  whatsoever  (other  than  Tenant's default),  cannot deliver  possession  of the Premises  to the Tenant on the Commencement  Date, this Lease shall not be void or voidable, nor shall Landlord be liable for any loss or damage resulting therefrom  (other  than as described  in the second  paragraph of Section  1.3 above),  but all rent shall be abated until Landlord delivers possession, and the Commencement  Date shall be adjusted as necessary.
	
 

 

	
 
	
2.2 
	
OPERATING EXPENSES.  Commencing  as of the Commencement  Date and continuing throughout the term of this Lease, Tenant shall pay, as additional rent ("additional rent"), Tenant's pro  rata share  (as  defined  in Section  1.7 above)  of  the  operating  expenses  of Landlord  for  the  Building  (the  "operating   expenses").     Landlord  shall  invoice  Tenant monthly  for Tenant's pro rata share of the estimated operating expenses for each calendar year.  Within  six  (6)  months  following  the  close  of  each  calendar  year,  Landlord  shall provide Tenant an accounting  showing  in reasonable detail the computations  of additional rent due under this Section.  In the event the total of the monthly payments made by Tenant exceeds the amount of additional rent due by Tenant under this Section, the accounting shall be accompanied  by evidence of a credit to Tenant's  account.   If the total of the monthly payments  made by Tenant is less than the amount of additional  rent due by Tenant under this Section, the accounting shall be accompanied by an invoice for the additional rent. Notwithstanding  any other provisions in this Lease, during the year in which this Lease terminates,  Landlord, prior to the termination date, shall have the option to invoice Tenant for Tenant's pro rata share  of  the  operating  expenses  based  upon  the  previous  calendar year's  operating expenses.  If this Lease shall terminate on a day other than the last day of a calendar year, the amount of any additional  rent payable by Tenant applicable to the year in which the termination  shall occur shall  be pro rated on the ratio that the number of days from the commencement  of the calendar year to and including such termination date bears to 365.   Tenant agrees to pay any additional  rent due under this Section within thirty (30) days following receipt of the invoice or accounting (together with reasonable supporting documentation) showing additional rent due.  Tenant's  pro rata share set forth in Section 1.7 shall, subject to reasonable adjustment  by Landlord, be equal to a percentage based upon a fraction, the numerator of which is the total area of the Premises as set forth in Section 1.2 above and the denominator  of which shall be the net rentable area of the Building, as the same may change from time to time.  Landlord shall maintain books and records showing, in  reasonable  detail,  actual  operating  expenses  in  accordance  with  generally  accepted accounting principles.  All such books and records shall be made available to Tenant for inspection  upon reasonable prior notice.   Notwithstanding  anything contained herein to the contrary,  any capital improvements  to the Building over $15,000.00  shall be amortized at 8%  interest  over  its  useful   life  in  accordance   with  generally   acceptable   accounting principles (GAAP). 
	
 

 

	
	
4

	
41905151-2

 

 

 

	
 
	
2.3
	
DEFINITION OF OPERATING  EXPENSES.   Except as expressly stated in this Lease, the term "operating  expenses"  includes all expenses  incurred by Landlord  with respect to the maintenance and operation of the Building,  including, but not limited to, the following: maintenance and repair and replacement costs; electricity, fuel, water, sewer, gas and other common  Building  utility  charges;  equipment  used  for  maintenance  and  operation  of the Building;   operational   expenses;   exterior   window   washing;   trash  and   snow   removal; landscaping and pest control; management fees, wages and benefits payable to employees of Landlord whose duties are directly connected with the operation and maintenance of the Building; all services, supplies, repairs, replacements or other expenses for maintaining and operating the Building or project including parking and common areas; improvements made to the Building which are required under any governmental  law or regulation that was not applicable to the Building at the time it was constructed; all other expenses which would generally  be regarded as operating,  repair, replacement and maintenance expenses; all real property taxes and installments of special assessments,  including dues and assessments  by means of deed restrictions  and/or  owner's association  which accrue  against  the Building during the term of this Lease and legal fees incurred in connection with actions to reduce the same; and all insurance  premiums Landlord  is required to pay or deems necessary to pay, including fire and extended coverage, and rent loss and public liability insurance.
	
 

 

The term "operating expenses" shall not include any of the following costs or expenses:

 

	
 
	
(i)
	
the cost of repairs, replacements  and general maintenance paid by the proceeds of insurance or by the Tenant  or other third parties, and alterations  attributed solely to tenants of the Building other than Tenant;
	
 

 

	
 
	
(ii)
	
depreciation   of  the  Building   and  equipment,   fixtures,   improvements,   and facilities used in connection therewith;
	
 

 

	
 
	
(iii)
	
legal expenses other than those incurred for the purpose of reducing common area costs (e.g., legal fees incurred in contesting the assessment of taxes);
	
 

 

	
 
	
(iv)
	
costs in renovating or otherwise  improving space for occupants of the Building or vacant space in the Building;
	
 

 

	
 
	
(v)
	
expenses incurred in leasing to or procuring of tenants, leasing commissions, advertising and promotional expenses;
	
 

 

	
 
	
(vi)
	
costs  incurred  in correcting  defects,  normal  wear  and  tear  excepted,  in  the construction of the Building;
	
 

 

	
 
	
(vii)
	
to the extent  Landlord  was obligated  to maintain  insurance  for such casualty under the Lease, any cost of restoration after an uninsured casualty;
	
 

 

	
 
	
(viii)
	
interest,   principal   payments   or   amortization   of   any   mortgage   or   other indebtedness of Landlord, nor depreciation allowance or expense;
	
 

 

	
 
	
(ix)
	
Landlord's  cost of electricity  and other services sold or provided to tenants in the Building and for which Landlord is reimbursed by such tenants as a separate additional charge or rental over and above the base rent and additional rent payments payable under the lease agreement with such tenant;
	
 

 

 

	
	
5

	
41905151-2

 

 

 

	
 
	
(x)
	
expenses  incurred in connection  with services or other benefits which are non building standard but are provided to other tenants or occupants of the Building
	
 

	
 
	
(xi)
	
costs (limited to penalties, fines and associated  legal expenses) incurred due to violations by Landlord of the terms and conditions of any lease or rental arrangement covering space in the Building;
	
 

 

	
 
	
(xii)
	
overhead and profit increment paid to subsidiaries, partners or other affiliates of Landlord and salaries and associated costs of Landlord's  employees for services on or to the Building, to the extent only that the cost of such services exceeds competitive costs of such services were they not so rendered by a subsidiary or other affiliate of Landlord;
	
 

 

	
 
	
(xiii)
	
any compensation paid to clerks, attendants or other persons in commercial concessions operated by Landlord;
	
 

 

	
 
	
(xiv)
	
all  items and  services  for  which  tenants  or other  parties  reimburse  Landlord (excluding reimbursements paid through additional rent payments);
	
 

 

	
 
	
(xv)
	
the  costs   incurred  and  related   to  maintaining   Landlord's   existence,   as  a corporation, partnership or other entity;
	
 

 

	
 
	
(xvi)
	
the costs incurred in connection  with correcting defects in the construction  of the  Building  or  Building  equipment  (except  that  conditions  resulting  from ordinary wear and tear and use shall not be deemed defects for the purposes of this category);
	
 

 

	
 
	
(xvii)
	
interest and penalties due to late payment of taxes, utility bills and other such costs;
	
 

 

	
 
	
(xviii)
	
salaries or other compensation  paid to employees of Landlord above the grade of building manager or in excess of their allocable service at or for the Building and costs of Landlord's  general corporate overhead and general administrative expenses  that  would  not  be  chargeable   to  basic  costs  of  the  Building  in accordance with generally accepted accounting principles, consistently applied;
	
 

 

	
 
	
(xix)
	
the cost of any repairs occasioned  by eminent domain to the extent  that such costs  are  reimbursed   to  Landlord   by  governmental   authorities   in  eminent domain proceedings net of all expenses in connection therewith;
	
 

 

	
 
	
(xx)
	
the cost of any artwork such as sculptures or original paintings used to decorate the Building; and
	
 

 

	
 
	
(xxi)
	
management  fees  incurred  by  Landlord  for  the management  of  the  Building which exceed four percent (4%) of all gross rentals of the Building.
	
 

 

	
 
	
2.4
	
INCREASE  IN INSURANCE  PREMIUMS.    If an increase  in any insurance  premiums paid by Landlord for the Building  is caused  by Tenant's  use of the Premises  or if Tenant causes an increase in such premiums, then Tenant shall pay as additional rent the amount of such increase to Landlord.
	
 

 

 

	
	
6

	
41905151-2

 

 

 

	
 
	
2.5 
	
SECURITY  DEPOSIT.    The security  deposit  set forth  in Section  1.6 shall  be held  by Landlord  for the performance  of Tenant's covenants  and obligations  under this Lease,  it being  expressly  understood  that the security  deposit  shall  not be considered  an advance payment of rental or a measure of Landlord's damage in case of default by Tenant.   Upon the occurrence of any event of default by Tenant or breach by Tenant of Tenant's covenants under this Lease, Landlord may, from time to time, without prejudice to any other remedy, use the security deposit to the extent necessary to make good any arrears of rent, or to repair any damage or injury, or pay any expense or liability incurred by Landlord as a result of the event of default  or breach of covenant, and any remaining  balance of the security  deposit shall be returned  by Landlord to Tenant upon termination  of this Lease.  If any portion of the security  deposit  is so used or applied,  Tenant  shall  upon ten (10)  days written notice from Landlord,  deposit  with Landlord  by cash or cashier's check an amount sufficient  to restore the security deposit to its original amount.
	
 

 

	
 
	
2.6 
	
LATE  CHARGES.    Tenant's failure  to pay rent promptly  may cause  Landlord  to incur unanticipated costs.  The exact amount of such costs are impractical or extremely difficult to ascertain, such costs may include, but are not limited to, processing and accounting charges and late charges which may be imposed on Landlord by any ground lease, mortgage or trust deed encumbering  the Property.   Therefore,  if Landlord  doesn't  receive any rent payment within five (5) days after it becomes due, Tenant shall pay Landlord a late charge equal to ten percent (10%) of the overdue amount.  The parties agree that such late charge represents a  fair  and  reasonable  estimate  of  the  costs  Landlord  will  incur  by  reason  of  such  late payment.
	
 

 

	
 
	
2.7 
	
INTEREST  ON PAST DUE OBLIGATIONS. Any amount owed by Tenant to Landlord which is not paid when due shall bear interest at the rate of fifteen percent (15%) per annum from the due date of such amount.  However, interest shall not be payable on late charges to be paid by Tenant  under this Lease.   The payment of interest on such amounts  shall not excuse or cure any default by Tenant under this Lease.   If the interest rate specified  in this Lease is higher than the rate permitted  by law, the interest rate is hereby decreased  to the maximum legal interest rate permitted by law.
	
 

 

ARTICLE 3.  OCCUPANCY  AND USE

 

	
 
	
3.1 
	
USE.   Tenant  shall  have  the  right  (but  not  the  obligation)  to  use  the  Premises  for  the purpose as set forth in Section 1.5.  Tenant shall conduct its business and control its agents, employees, invitees and visitors in such a manner as is lawful, reputable and will not create a nuisance.   Tenant shall not permit any operation  which emits any odor or matter which intrudes other portions of the Building or otherwise  interferes with, annoys or disturbs any other  portions  of the Building  or otherwise  interferes  with, annoys  or disturbs  any other lessee in its normal  business operations  or  Landlord  in its management  of the Building. Tenant shall neither permit any waste on the Premises nor permit the Premises to be used in any way which would in the opinion of Landlord,  be extra hazardous on account of fire or which would in any way increase or render void the fire insurance on the Building.
	
 

 

	
 
	
3.2 
	
SIGNS.  No sign or stickers of any type or description (security stickers to only be applied to glass surfaces)  shall be erected,  placed or painted  in or about the Premises or Building which are visible from the exterior of the Premises, except those submitted to, and approved by Landlord in writing (which approval shall not be unreasonably withheld, conditioned or delayed), and are in conformance  with Landlord's sign criteria, if any, established  for the Building.  Security stickers may be placed on glass surfaces only.
	
 

 

 

	
	
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3.3 
	
COMPLIANCE WITH  LAWS, RULES  AND REGULATIONS.    Tenant,  at Tenant's sole cost and expense, shall comply with all laws, ordinances, orders, rules and regulations of state,  federal,  municipal  or other  agencies  or  bodies  having jurisdiction  over  the  use, condition or occupancy of the Premises.  Tenant will comply with the reasonable rules and regulations  of  the  Building  established  in writing  by  Landlord.  Subject  to  the  rights  of Tenant under this Lease, Landlord shall have the right at all times to change and amend the rules and regulations  in any reasonable manner as may be deemed advisable for the safety, care, cleanliness,  preservation  of good order  and  operation  or use of the Building  or the Premises.   All rules and regulations  of the Building  will be sent by Landlord to Tenant in writing, shall be enforced  by Landlord in a non-discriminatory  manner, and shall thereafter be carried out and observed  by Tenant. In the event of any conflict between the provisions of this  Lease and any  rules or regulations,  the provisions  of this Lease shall govern  and control.
	
 

 

	
 
	
3.4 
	
WARRANTY  OF   POSSESSION;  QUIET  ENJOYMENT.    Landlord  warrants  that Landlord  has good title to the Property and Building  and that Landlord has the right and authority to execute this Lease, and Tenant, upon payment of the required rents and subject to the  terms,  conditions,  covenants  and  agreements  contained  in this  Lease,  shall  have possession of the Premises  during the full term of this Lease as well as any extension  or renewal thereof.   Landlord shall not be responsible  for the acts or omissions  of any other lessee or third party that may interfere with Tenant's use and enjoyment of the Premises.
	
 

 

	
 
	
3.5 
	
RIGHT OF ACCESS.  Except as otherwise stated, Landlord or its authorized agents shall at any and all reasonable  times have the right to enter the Premises to inspect the same, to show  the  Premises  to  prospective   purchasers,  Tenants,   mortgagees,  insurers  or  other interested parties, and to alter, improve or repair the Premises or any other portion of the Building.   Except  as expressly  stated  in this Lease,  Tenant  hereby waives  any claim for damages for injury or inconvenience  to or interference with Tenant's  business, any loss of occupancy  or use of the Premises,  and any other loss occasioned  thereby.   Landlord shall have the right to use any and all lawful means which Landlord may deem proper to open any door in an emergency  without liability therefor.   Tenant shall permit Landlord to erect, use,  maintain  and  repair  pipes,  cables,  conduits,  plumbing,  vents  and  wires  in,  to  and through  the Premises  as often  and to the extent  that the Landlord  may now or hereafter deem to be necessary or appropriate for the proper use, operation and maintenance of the Building, provided the same does not unreasonably  interfere with Tenant's use or operation of  the  Premises,  or  Tenant's rights  under  this  Lease.  Notwithstanding  anything  to  the contrary in this Lease, except in the case of an emergency,  a representative of Tenant shall have the right to accompany  Landlord (or Landlord's representative,  if applicable)  during any  Landlord  inspection  or other  entry  by Landlord.   Upon the expiration  of this Lease, Landlord and Tenant shall arrange for a joint inspection of the Premises prior to vacating, and shall conduct an exit inspection and complete an exit inspection report.
	
 

 

ARTICLE 4. UTILITIES AND ACTS OF OTHERS

 

	
 
	
4.1 
	
BUILDING SERVICES.  Tenant shall pay when due, all charges for utilities furnished to or for the use or benefits of Tenant or the Premises. Tenant shall have no claim for rebate of rent on account of any interruption  in service. Notwithstanding  the foregoing, except in the event  of a casualty,  in which  case  the provisions  of Article 7 shall control,  in the event utilities serving the Premises are interrupted due to the negligence or willful misconduct of Landlord,  its agents,  employees,  representatives  or  contractors,  and  if such  interruption creates  a condition  which substantially  interferes  with the normal use of the Premises  by Tenant,  and,  as  a  consequence,  Tenant  is  required  to  cease  business  operations  in  the Premises,  in whole or in part, for a period of three (3) days, then commencing  as of the fourth  (4th) day of the interruption  and continuing  through  the remaining  period  of such interruption, any and all Base Rent and additional rent payable hereunder shall be abated in proportion to the area of the Premises which cannot be used by Tenant.
	
 

	
 
	
4.2
	
THEFT  OR BURGLARY.   Landlord shall not be liable to Tenant for losses to Tenant's 
	
 

 

	
	
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property  or personnel  caused  by criminal  acts or entry  by unauthorized  persons  into the Premises or the Building.
	
 

 

ARTICLE  5. REPAIRS  AND MAINTENANCE

 

	
 
	
5.1 
	
LANDLORD  REPAIRS.    Landlord  shall  not  be  required  to  make  any  improvements, replacements  or repairs of any kind or character to the Premises or the Building during the term of this Lease except as are set forth in this Section.   Landlord shall maintain only the roof, foundation,  parking and common areas, the structural soundness of the exterior walls, doors, corridors and other structures serving the Premises, provided that Landlord's  cost of maintaining,   replacing  and  repairing  the  items  set  forth  in  this  Section  are  operating expenses subject to the additional  rent provisions in Section 2.2 and 2.3. Landlord shall not be  liable  to  Tenant,  except  as  expressly   provided  in  this  Lease,  for  any  damage  or inconvenience  and Tenant  shall  not be entitled  to any abatement  or reduction  of rent by reason of any repairs, alterations or additions made by Landlord under this Lease. Landlord hereby  represents,  warrants  and covenants  to the Tenant  that the Building (including  any common  areas  and  the  Premises,  including  the  Landlord's   Work)  has  been  or  will  be erected,  installed,  constructed,  completed  and operated  in a good  and workmanlike  first­ class manner, structurally  sound and free of latent defects, in accordance with all applicable laws as of the Commencement  Date.  Landlord shall be responsible for compliance of the Premises  (including  the  Landlord's Work),  the common  areas,  all  other  portions  of  the Building and the Property with all plans, specifications,  codes and laws governing, as of the Commencement  Date, life/fire safety,  physical handicap, earthquake  safety, environmental issues and the Americans with Disabilities Act (the "ADA").   If the Premises (including the Landlord's  Work), other portions of the Building or the Property are found to be in noncompliance, Landlord shall promptly remedy the violation at Landlord's sole cost and expense.  Landlord shall promptly cure at its sole cost and expense any omission or defects in  the  Premises  or  the  Building  that  were  not  known  or  readily  discoverable   upon acceptance  of  possession,  and  thereafter  shall  remain  liable for  any  latent defects  in the Premises and the Building.  Landlord shall promptly, after receiving written notice thereof by Tenant, correct any and all such defects or omission at Landlord's  sole cost and expense.
	
 

 

Prior to the Commencement  Date, Landlord  will certify that the HVAC system (including all  applicable  HVAC  equipment)  serving  the  Premises,  the  plumbing  and  the  electrical systems  are in proper working condition.   During the term of this Lease, Tenant  shall  be obligated  to enter  into a preventative  maintenance  contract  with  a  reputable  mechanical company licensed to do business in the State in which the Premises are located (the "HVAC Contractor")  for the purpose of performing no less than semi-annual maintenance repairs on all  HVAC  equipment  serving  the  Premises,  it  being  understood  and  agreed  that  such preventative  maintenance contract shall be consistent and comparable to industry standards for  buildings  which  are  comparable  to  the  building  of  which  the  Premises  are  a  part. Notwithstanding  the foregoing,  so long as the Tenant  complies  with  its obligations  with respect to the preventative  maintenance  contract with respect to the HVAC system, in the event, at any time during the term of this  Lease, the HVAC Contractor determines that one or  more  HVAC  systems  (or  any  HVAC  equipment  related  thereto)  must  be  replaced, Landlord,  at Landlord's  sole cost and expense,  shall  be obligated  to replace (and  install) such HVAC system (or applicable HVAC equipment), it being specifically  understood and agreed that in no event shall the costs incurred by Landlord be passed through or included as part of operating  expenses.   It is further  understood  that once Landlord  properly replaces and installs any new HVAC equipment in accordance with the manufacturer's specifications and in accordance with applicable  laws and codes, Tenant shall be fully responsible for all repairs, maintenance and replacement of such new HVAC equipment for the duration of the lease.

 

 

	
	
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5.2
	
TENANT  REPAIRS.     Tenant  shall,  at  all  times  throughout  the  term  of  this  Lease, including  renewals and extensions, at its sole expense, keep and maintain the Premises in a clean,  safe, sanitary  and first class condition  and  in compliance  with all applicable  laws, codes, ordinances, rules and regulations.  Except as provided in Section 5.1 above, Tenant's obligations  hereunder shall include, but not be limited to, the maintenance, repair and replacement,  if necessary, of all heating, ventilation, air conditioning,  lighting and plumbing fixtures and equipment, fixtures, motors and machinery, all interior walls, partitions, doors and windows, including the regular painting thereof, all exterior entrances, windows, doors and docks and the replacement of all broken glass.  When used in this provision, the term "repairs" shall include, if applicable, replacements or renewals when necessary, and all such repairs  made by the Tenant shall  be equal  in quality and class to the original  work.   The Tenant  shall  keep and  maintain  all  portions  of the Premises  and  the sidewalk  and areas adjoining  the same in a clean and orderly condition, free of accumulation  of dirt, rubbish, snow  and  ice.  If Tenant  fails,  refuses  or  neglects  to  maintain  or  repair  the  Premises  as required  in this Lease after notice shall have been given Tenant and provided such failure shall continue  beyond any applicable  cure period, in accordance with this Lease, Landlord may make such repairs without liability to Tenant for any loss or damage that may accrue to Tenant's merchandise, fixtures or other property or to Tenant's business by reason thereof, and  upon completion  thereof, Tenant  shall  pay to Landlord  all costs  plus fifteen  percent (15%)  for  overhead  incurred  by  Landlord  in  making  such  repairs  upon  presentation  to Tenant of bill therefor.
	
 

 

	
 
	
5.3
	
TENANT DAMAGES.   Tenant  shall  not  allow  any  damages  to  be committed  on  any portion of the Premises or Building or common areas, and at the termination of this Lease, by lapse  of time or otherwise,  Tenant  shall  deliver  the Premises  to Landlord  in as good condition  as existed at the Commencement  Date of this Lease, ordinary  wear and tear and damage  due  to  a casualty  or  condemnation,  excepted.  The  cost  and  expense  of  repairs necessary to restore the condition of the Premises shall be borne by Tenant.
	
 

 

ARTICLE 6.  ALTERATIONS AND IMPROVEMENTS

 

	
 
	
6.1
	
LANDLORD IMPROVEMENTS.  Landlord, at Landlord's  sole cost and expense, shall be obligated  to perform those tenant  improvements  (a) which are shown  or described  on Exhibit  B attached  hereto, and on Exhibit  B-1  attached  hereto, and (b) such other  items which are described as follows (all such work being hereinafter referred to as "Landlord's Work"):
	
 

 

	
 
	
•
	
Build to suit office space per Exhibit B.
	
 

	
 
	
•
	
Paint office area with industry standard paint, color selection by Tenant.
	
 

	
 
	
•
	
Stripe Thirty (30) new parking stalls in truck court and along Hwy 88 as shown in Exhibit D.
	
 

	
 
	
•
	
Install new Landlord's standard carpet in office area, color selection by Tenant.
	
 

	
 
	
•
	
Service  and certify  existing  HVAC  system servicing  the Premises  is in good working order as of the Commencement  Date.
	
 

	
 
	
•
	
Ensure that all existing  HVAC, plumbing, electrical, doors and hardware are in good working order as of the Commencement  Date.
	
 

 

Landlord's scope of work will not be contrary to or in conflict with the specific terms which are set forth in this Section 6.1, Exhibit B attached hereto. In the event that the terms of this Section 6.1, and the Exhibit B attached  hereto, do not encompass all of the scope of work that  is  the  Landlord's  Work,  Landlord  and  Tenant  agree  to  use  reasonable  efforts  to cooperate  with each other and to act in good faith. Notwithstanding  the foregoing, Tenant shall have the right to request changes to the scope of the Landlord's  Work so long as such changes do not affect the 

 

	
	
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cost of the Landlord's Work or the date by which Landlord must complete  the Landlord's  Work. If Tenant's requested changes increase the scope or cost of work, Landlord shall inform Tenant and Tenant shall be responsible for all costs associated with such change.  All changes shall be in writing.

 

As  of  the Commencement   Date,  Landlord  shall  be  responsible  for (a)  ensuring  that the Premises,  the  common  areas,  the  Building  and  the  Property  are  in compliance  with  all applicable laws and codes (including, but not limited to, the ADA); and (b) ensuring that the Landlord's  Work is in compliance  with the plans and specifications  and the terms of this Lease and all applicable laws and codes, including, but not limited to, ADA.

 

As soon  as the Landlord's  Work has been substantially  completed,  Landlord  shall  notify Tenant.  Regardless of when completed or corrected, all punch list items shall be completed or corrected  by Landlord in a good and workmanlike  first-class manner, structurally  sound and free of latent defects, in accordance with all applicable laws and plans

 

Landlord shall cause all contractors and subcontractors  involved in the construction  of the Landlord's  Work to: (1) maintain insurance covering risks associated with the construction of the Landlord's Work, including, but not limited to worker's  compensation,  builder's  risk and commercial  general  liability insurance  covering  personal injury and property damage, with contractual  liability endorsement,  in the amount of not less than One Million Dollars ($1,000,000)  per occurrence for personal injuries or deaths of persons occurring in are about the area  of,  or  in connection  with  the construction  of,  the Landlord's   Work, and  which insurance policy or policies shall name Tenant as an additional insured; and (2) indemnify, hold harmless and defend Tenant from and against any and all claims (including  all costs, counsel fees, expenses and liabilities incurred in connection  with any such claim or action or proceeding brought thereon) or liability for any injury or damage to any person in, on or about the Premises or any part thereof, when such injury or damage shall be caused by the act, neglect, fault of or omission of any duty with respect to the same by such contractors and   subcontractors,   their   respective   agents,   servants,   employees   and   invitees   to  the Premises.

 

Subject to (a) the Landlord's  Work set forth in this Section 6.1 and on Exhibit B attached hereto, and (b) any continuing obligations of Landlord as expressly stated in this Lease, and (c) any representations  of Landlord which are expressly stated in this Lease, Tenant agrees to take the Premises in its "AS-IS" condition.

 

	
 
	
6.2
	
TENANT IMPROVEMENTS. Tenant shall not make or allow to be made any alterations or physical  additions  in or to the Premises  without  first obtaining  the written  consent  of Landlord, which consent shall not be unreasonably  withheld, conditioned  or delayed.   Any alterations,  physical  additions  or improvements  to the Premises  made  by Tenant  shall at once  become  the  property  of  Landlord  and  shall  be surrendered  to  Landlord  upon  the termination  of this Lease, provided, however, Landlord, at its option and provided  that the Landlord provides such written notice at the time in which its approval is given with respect to  the  performance  of  any  physical  additions  and/or  alterations,  may  require  Tenant  to remove any physical additions and/or repair any alterations in order to restore the Premises to the conditions existing at the time Tenant took possession, all costs of removal and/or alterations  to be borne by Tenant.   This clause shall not apply to moveable equipment  or furniture owned by Tenant, which may be removed by Tenant at the end of the term of this Lease if Tenant is not then in default and if such equipment and furniture are not subject to any other rights, liens and interests of Landlord.
	
 

 

 

	
	
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ARTICLE 7.  CASUALTY AND INSURANCE

 

	
 
	
7.1
	
SUBSTANTIAL DESTRUCTION.  If all or a substantial  portion of the Premises or the Building  should  be totally  destroyed  by fire or  other  casualty,  or if the  Premises  or the Building should be damaged  so that rebuilding cannot reasonably be completed  within one hundred eighty (180) working days after the date of  the casualty, or if insurance  proceeds are not made available  to Landlord, or are inadequate  for restoration, Landlord  or Tenant shall have the right to terminate this Lease by written notice to the other within sixty (60) days  following  the  date  of  the casualty,  and  the  rent  shall  be abated  for  the  unexpired portion of the Lease effective as of the date of this written notification. If all or a substantial portion of the Premises or the Building should be totally destroyed by fire or other casualty and the rebuilding can be reasonably  completed  within one hundred eighty (180)  working days after the date of the casualty,  this Lease shall not terminate and Landlord shall at its sole risk and expense proceed with reasonable diligence  to rebuild or repair the Building or other improvements  to substantially  the same condition  in which they existed  prior to the damage.
	
 

 

	
 
	
7.2
	
PARTIAL DESTRUCTION.  If the Premises should be partially damaged by fire or other casualty, and rebuilding or repairs can reasonably  be completed within one hundred eighty (180) working days from the date of the casualty, and insurance proceeds are adequate and available to Landlord for restoration, this Lease shall not terminate, and Landlord shall at its sole risk and expense proceed with reasonable diligence to rebuild or repair the Building or other improvements to substantially the same condition in which they existed prior to the damage. If the Premises are to be rebuilt or repaired and are untenantable in whole or in part following the damage and the damage or destruction was not caused or contributed to by act of  negligence  of  Tenant,  its  agents,  employees,   invitees  or  those  for  whom  Tenant  is responsible, the rent payable under this Lease during the period for which the Premises are untenantable shall be adjusted to such an extent as may be fair and reasonable under the circumstances.   In the event Landlord fails to complete  the necessary repairs or rebuilding within one hundred eighty (180) working days from the date of the casualty, Tenant may at its option terminate this Lease by delivering written notice of termination to Landlord, whereupon all rights and obligations under this Lease shall cease to exist.
	
 

 

	
 
	
7.3 
	
PROPERTY INSURANCE.   Landlord  shall  not  be obligated  in any  way  or manner  to insure any personal property (including, but not limited to, any furniture, machinery, goods or supplies)  of Tenant  upon or within the Premises,  any fixtures  installed  or paid for  by Tenant upon or within the Premises, or any improvements  which Tenant may construct on the Premises.  Tenant shall  maintain property  insurance  on its personal property  and shall also maintain plate glass insurance. Tenant shall have no right in or claim to the proceeds of any policy of insurance maintained  by Landlord even if the cost of such insurance is borne by Tenant as set forth in Article 2.
	
 

 

	
 
	
7.4 
	
WAIVER OF SUBROGATION.  Anything in this Lease to the contrary notwithstanding, Landlord and Tenant hereby waive and release each other of and from any and all right of recovery, claim, action or cause of action, against each other, their agents, officers and employees, for any loss or damage that may occur to the Premises, the improvements of the Building  or  personal  property  within  the  Building,  by  reason  of  fire  or  the  elements, regardless of cause or origin, including negligence of Landlord or Tenant and their agents, officers  and employees.  Landlord  and Tenant  agree  immediately  to give their  respective insurance  companies  which  have  issued  policies  of  insurance  covering  all  risk of  direct physical loss, written notice of the terms of the mutual waivers contained in this Section.
	
 

 

 

	
	
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7.5 
	
HOLD HARMLESS.  Landlord shall not be liable to Tenant's  employees, agents, invitees, licensees or visitors, or to any other person, for an injury to a person or damage to property on or about the Premises (i) caused by any act or omission of Tenant, its agents, servants or employees,  or of any other  person  entering  upon  the  Premises  under express  or  implied invitation by Tenant, or (ii) caused by the improvements  located on the Premises becoming out of repair, or (iii) unless caused by the negligence or willful misconduct of Landlord,  its employees,  agents,  representatives  or contractors,  the failure  or  cessation  of any service provided by Landlord (including security service and devices), or caused by leakage of gas, oil,  water  or  steam  or  by  electricity  emanating  from  the  Premises.    Tenant  agrees  to indemnify and hold harmless  Landlord of and from any loss, attorney's  fees, expenses  or claims arising out of any such damage or injury. Except for any claims, rights of recovery and  causes of action  that Tenant  has released,  Landlord  shall hold Tenant  harmless  and defend the Tenant against any and all claims (including all costs, counsel fees, expenses and liabilities  incurred  in  connection  with  any  such  claim  or  action  or  proceeding  brought thereon) or liability for any injury or damage to any person in, on or about the Premises, the Building or the Property, when such injury or damage shall be caused by the act, neglect, fault  of, or omission  of  any  duty  with  respect  to  the same  by Landlord,  its employees, agents, representatives or contractors.  The provisions of this Section 7.5 shall survive the expiration or termination of this Lease with respect to any claims or liability occurring prior to such expiration or termination.
	
 

 

	
 
	
7.6 
	
PUBLIC  LIABILITY  INSURANCE.   Tenant shall  during  the term hereof  keep in full force and effect at its expense a policy or policies of public liability insurance with respect to the Premises and the business of Tenant, on terms and with companies request approved in writing by Landlord (which approval shall not be unreasonably  withheld, conditioned or delayed) under reasonable limits of liability not less than $1,000,000, combined single limit coverage for injury or death. Tenant shall provide Landlord with thirty (30) days'  written notice prior to cancellation thereof. Tenant shall furnish reasonable evidence satisfactory to Landlord at the time this Lease is executed that such coverage is in full force and effect.
	
 

 

	
 
	
7.7 
	
INSURANCE TO BE MAINTAINED BY LANDLORD.
	
 

 

	
 
	
A.
	
Landlord  shall  maintain  all  risks  property  insurance  covering  the  Building  in an amount not less than the "replacement cost" thereof.  Said policy or policies or certificates  thereof shall be delivered to Tenant  by Landlord upon commencement of the Lease and thereafter,  as requested  in writing  by Tenant  but no more than annually.
	
 

 

	
 
	
B.
	
Landlord  shall  maintain  during  the  term  of  this  Lease  a  policy  or  policies  of worker's  compensation  and  commercial  general  liability  insurance.   The  general liability policy shall include coverage for bodily injury and property damage, with contractual  liability  coverage,  with a combined  single  limit of not less than One Million Dollars ($1,000,000.00) per occurrence.
	
 

 

ARTICLE 8. CONDEMNATION

 

	
 
	
8.1 
	
SUBSTANTIAL TAKING.   If all or a substantial  part of the Premises are taken for any public or quasi-public use under any governmental  law, ordinance or regulation, or by right of  eminent  domain  or  by  purchase  in  lieu  thereof,  and  the  taking  would  prevent  or materially interfere with the use of the Premises for the purpose for which it is then being used, this Lease shall terminate and the rent shall be abated during the unexpired portion of this Lease effective on the date physical possession  is taken by the condemning  authority. Tenant shall have no claim to the condemnation  award or proceeds in lieu thereof, except that Tenant shall be entitled  to a separate  award for the cost of removing and moving its personal property.
	
 

 

 

	
	
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8.2 
	
PARTIAL  TAKING.   If all or a substantial part of this Premises are taken for a public or quasi-public   use  under  any  governmental   law,  ordinance  or  regulation,  or  by  right  of eminent domain or by purchase in lieu thereof, and this Lease is not terminated as provided in Section 8.1 above, the rent payable under this Lease during the unexpired portion of the term  shall  be  adjusted   to  such  an  extent  as  may  be  fair  and  reasonable  under  the circumstances.   Tenant shall have no claim to the condemnation  award or proceeds in lieu thereof, except that Tenant shall be entitled to a separate award for the cost of removing and moving its personal property.
	
 

 

ARTICLE  9. ASSIGNMENT OR SUBLEASE

 

	
 
	
9.1 
	
LANDLORD ASSIGNMENT.  Except as otherwise provided in this Lease, Landlord shall have the right to sell, transfer or assign, in whole or in part, its rights and obligations under this  Lease  and  in  the  Building.     Upon  the  occurrence   of  any  such  sale,  transfer  or assignment  and provided that the purchaser, transferee or assignee shall assume in writing all of Landlord's  obligations  under the Lease, Landlord  shall be released from any and all liabilities under this Lease arising after the date of such sale, assignment or transfer.
	
 

 

	
 
	
9.2 
	
TENANT ASSIGNMENT.  Except as otherwise allowed herein, Tenant shall not assign, in whole or in part, this Lease, or allow it to be assigned, in whole or in part, by operation of law or otherwise  (including  without  limitation  by transfer of a majority  interest of stock, merger,  or dissolution,  which transfer of majority  interest of stock, merger or dissolution shall be deemed an assignment)  or mortgage or pledge the same, or sublet the Premises, in whole  or  in  part,  without  the  prior  written  consent  of  Landlord,  which  shall  not  be unreasonably  withheld or delayed,  and in no event shall said such assignment or sublease ever release Tenant or any guarantor  from any obligation  or liability hereunder. Notwithstanding  anything  in this Lease to the contrary,  in the event of any assignment  or sublease  to a party other than a Permitted  Transferee,  any option or right of first refusal granted to Tenant shall not be assignable by Tenant to any assignee or sublessee.  Except in the case of a Permitted Transferee,  no assignee or sublessee of the Premises or any portion thereof may assign or sublet the Premises or any portion thereof. Notwithstanding anything in this Lease to the contrary,  Tenant  shall have the right to assign, sublet or transfer this Lease, or its interest therein (each being referred to as a "Permitted  Transfer"),  without the prior written consent of Landlord and without additional payment to Landlord, to Tenant's parent company or to any of Tenant's subsidiaries or affiliates (each being referred to as a "Permitted   Transferee").    In  addition,  notwithstanding  anything  to  the  contrary  in  this Lease,  a change  of control  of Tenant  or a sale of all or substantially  all of the assets or equity  interests of Tenant or a merger of the Tenant shall not be deemed an assignment of this   Lease   for  any  reason,   and   no  notice  to  Landlord   shall   be  required   upon  the consummation of any such transaction.
	
 

 

	
 
	
9.3 
	
CONDITIONS OF ASSIGNMENT.  If Tenant desires to assign or sublet all or any part of the Premises, it shall so notify Landlord at least thirty (30) days in advance of the date on which Tenant desires to make such assignment or sublease.  Tenant shall provide Landlord with a copy of the proposed assignment or sublease and such information as Landlord might reasonably  request  concerning  the  proposed  sublessee  or  assignee  to  allow  Landlord  tomake informed judgments as to the financial condition, reputation, operations and general desirability  of the proposed sublessee or assignee.   Within thirty (30) days after Landlord's receipt   of   Tenant's    proposed   assignment   or   sublease   and   all   required   information concerning  the proposed sublessee or assignee,  Landlord shall have the following options: ( 1) consent to the proposed assignment  or sublease, and, if the rent due and payable by any assignee or sublessee under any such permitted assignment or sublease (or a combination of the   rent   payable   under  such   assignment   or  sublease   plus  any   bonus   or  any  other consideration  or any payment  incident thereto) exceeds the rent  payable under this Lease for  such  space,  Tenant  shall  pay  to  Landlord  all  such  excess  rent  and  other  excess consideration  within ten (10) days 
	
 

 

	
	
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following  receipt thereof by Tenant; or (2) refuse, in its sole  and  absolute  discretion  and  judgment,  to  consent  to  the  proposed  assignment  or sublease,  which  refusal  shall  be  deemed  to  have  been  exercised  unless  Landlord  gives Tenant  written notice providing otherwise.   Upon the occurrence of an event of default, if all or any part of the Premises are then assigned or sublet, Landlord, in addition to any other remedies provided by this Lease or provided by law, may, at its option, collect directly from the assignee or sublessee all rents becoming due to Tenant by reason of this assignment or sublease,  and Landlord shall  have a security  interest  in all properties on the Premises to secure payment of such sums..  Any collection directly by Landlord from the assignee or sublessee  shall  not  be construed  to constitute  a  novation  or  a  release  of  Tenant  or  any guarantor from the further performance of its obligation under this Lease.
	
 

 

	
 
	
9.4 
	
RIGHTS  OF  MORTGAGE.     Provided  that the mortgagee in question shall execute and deliver an industry standard commercially  reasonable non-disturbance agreement, this Lease shall  be subject  and subordinate  to any recorded  mortgage  presently existing  or hereafter created upon the Building and to all existing recorded restrictions, covenants, easements and agreements  with  respect  to  the  Building.  Subject  to the terms stated  herein,  Landlord  is hereby  irrevocably  vested  with  full  power  and authority  to subordinate  Tenant's   interest under this Lease  to any first mortgage  lien hereafter  placed on the Premises, and Tenant agrees upon written demand to execute additional instruments subordinating this Lease as landlord  may  reasonably  require.    If the  interests  of  Landlord  under  this  Lease shall  be transferred  by  reason  of  foreclosure  or  other  proceedings  for  enforcement  of  any  first mortgage  or  deed  of  trust  on  the  Premises,  Tenant  shall  be  bound  to  the  transferee (sometimes   called  the  "Purchaser")  at  the  option  of  the  Purchaser,   under  the  terms, covenants and conditions of this Lease for the balance of the term remaining, including any extensions  or renewals, with the same force and effect as if the Purchaser  were Landlord under  this  Lease,  and,  if  requested   by  the  Purchaser,  Tenant  agrees  to  attorn  to  the Purchaser,  including the first mortgagee under any such mortgage if it be the Purchaser, as its Landlord.  Notwithstanding  the foregoing, Tenant shall not be disturbed in its possession of the Premises so long as Tenant is not in default hereunder.
	
 

 

	
 
	
9.5 
	
TENANT'S STATEMENT.  Tenant agrees to furnish, from time to time, within ten (10) days after receipt of a written request from Landlord to Landlord's  mortgagee, a statement certifying, if applicable, the following:  Tenant is in possession of the Premises; the Lease is in full force and effect; the Lease is unmodified (or if modified, stating same); as of the date thereof and to Tenant's  actual knowledge, Tenant claims no present charge, lien, or claim or offset  against  rent (or  if there are any known  charges,  liens, or claims  or offsets, stating same); the rent is paid for the current month, but is not prepaid for more than one month and will  not  be prepaid for  more  than  one  month  in advance;  as of  the  date  thereof  and  to Tenant's actual knowledge, there is no existing default by reason of some act or omission by Landlord (or if there are any known defaults, stating same); and such other matters may be reasonably  required by Landlord or Landlord's  mortgagee.   Tenant agrees to furnish, from time to time, within ten (1 0) days after receipt of written request from Landlord, a current foregoing, so long as the financials of Tenant (or Tenant's parent company) are publicly available, Tenant shall be deemed to have complied with the provisions of this Section 9.5). Furthermore,  in the event that the financials  of Tenant (and Tenant's  parent company) are not publicly available, Tenant shall have no obligation to deliver any financial statements to Landlord  unless Landlord has executed a commercially  reasonable confidentiality  and non­ disclosure agreement.
	
 

 

	
	
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ARTICLE 10.  INTENTIONALLY OMITTED ARTICLE

11.  DEFAULT AND REMEDIES

 

	
 
	
11.1
	
DEFAULT  BY  TENANT.    The  following  shall  be  deemed  to  be  events  of  default ("Default")  by  Tenant  under  this  Lease:    (1)  Tenant  shall  fail  to  pay  when  due  any installment  of rent or any other  payment  required  pursuant to this Lease and where such failure  shall continue  for a period of ten (1 0) days after written  notice;   (2) Tenant  shall abandon  any substantial  portion of the Premises; (3) Tenant shall fail to comply  with any term, provision or covenant of this Lease, other than the payment of rent, and the failure is not  cured  within  thirty  (30)  days  after  written  notice to Tenant  or  such  additional  time period  as is reasonably  necessary  to cure such default,  provided Tenant  commences  such cure and proceeds with due diligence to cure such default;  (4) Tenant shall file a petition or if an involuntary petition is filed against Tenant, or becomes insolvent, under any applicable federal  or state  bankruptcy  or insolvency  law or admits  that  it cannot  meet  its financial obligation  as  they  become  due,  or  a  receiver  or  trustee  shall  be  appointed  for  all  or substantially all of the assets of Tenant; or Tenant shall make a transfer in fraud of creditors or shall make an assignment for the benefit of creditors; or (5) Tenant shall do or permit to be done  any act  which results  in a lien  being filed  against  the Premises  or the Building and/or project of which the premises are a part (and where such lien has not been discharged or bonded against within thirty (30) days).
	
 

 

In  the  event  that  an order  for  relief  is entered  in any  case  under  Title  11, U.S.C.  (the "Bankruptcy Code") in which Tenant is the debtor and:  (A) Tenant as debtor-in-possession, or any trustee who may be appointed in the case (the "Trustee") seeks to assume the Lease, then Tenant, or Trustee if applicable, in addition to providing adequate assurance described in  applicable   provisions  of  the  Bankruptcy  Code,  shall  provide  adequate  assurance  to Landlord  of Tenant's future  performance  under this Lease by depositing  with Landlord a sum equal to the lesser of twenty-five percent (25%) of the rental or other charges due for the balance of this Lease term or six (6) months'  rent ("Security"),  to be held (without any allowance  or  interest  thereon)  to  secure  Tenant's obligation  under  the  Lease,  and  (B) Tenant, or Trustee if applicable, seeks to assign the Lease after assumption of the same, then Tenant, in addition to providing   adequate  assurance  described  in applicable  provisions of the  Bankruptcy  Code,  shall    provide  adequate  assurance  to  Landlord  of  the  proposed assignee's future performance under the Lease by depositing with Landlord, a sum equal to the Security  to be held (without any allowance  or interest thereon) to secure performance under the Lease.   Nothing contained  herein expresses  or implies, or shall be construed  to express or imply, that Landlord is consenting to assumption and/or assignment of the Lease by Tenant,  and  Landlord  expressly  reserves  all of  its rights to object  to any  assumption and/or assignment of the Lease.  Neither Tenant nor any Trustee shall conduct or permit the conduct of any "fire", "bankruptcy",  "going  out of business" or auction sale in or from the Premises. 

 

	
 
	
11.2
	
REMEDIES FOR TENANT'S DEFAULT.  Upon the occurrence of a Default as defined above, Landlord may elect either (i) to cancel and terminate this Lease and this Lease shall not be treated as an asset of Tenant's  bankruptcy estate, or (ii) to terminate Tenant's right to possession  only without  canceling  and terminating  Tenant's continued  liability  under this Lease.    Notwithstanding   the  fact  that  initially  Landlord  elects  under  (ii)  to  terminate Tenant's  right to possession only, Landlord shall have the continuing right to cancel and terminate  this  Lease  by  giving  three  (3)  days'  written  notice  to  Tenant  of  such  further election,  and shall  have  the right to  pursue  any  remedy  at law or in equity  that  may  be available to Landlord.
	
 

 

 

	
	
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In the event of election  under (ii) to terminate  Tenant's right to possession only, Landlord may, at Landlord's  option, enter the Premises and take and hold possession thereof, without such entry  into possession  terminating  this Lease or  releasing Tenant  in whole or in part from Tenant's obligation  to pay all amounts hereunder for the full stated term.  Upon such re-entry,  Landlord  may  remove  all  persons  and  property  from  the  Premises  and  such property may be removed and stored in a public warehouse or elsewhere at the cost and for the  account  of  Tenant,  without  becoming  liable  for  any  loss or  damage  which  may  be occasioned  thereby.    Such  re-entry  shall  be conducted  in the following  manner:  without resort to judicial process or notice of any kind if Tenant has abandoned or voluntarily surrendered  possession of the Premises, and, otherwise, by resort to judicial process.  Upon and after entry into possession without termination  of the Lease, Landlord  may, but is not obligated to, relet the Premises, or any part thereof, to anyone other than the Tenant for such time  and  upon  such  terms  as  Landlord,  in  Landlord's sole  discretion,  shall  determine. Landlord  may  make  alterations  and  repairs  to  the  Premises  to  the  extent  deemed  by Landlord necessary or desirable.

 

Upon such re-entry, Tenant shall be liable to Landlord as follows:

 

	
 
	
A. 
	
For reasonable attorney's fees incurred by Landlord in connection with exercising any remedy hereunder.
	
 

 

	
 
	
B. 
	
For the unpaid  installments  of Base  Rent, additional  rent or other  unpaid sums which were due prior to such re-entry,  including  interest and late payment fees, which sums shall be payable immediately.
	
 

 

	
 
	
C. 
	
For  the  installments  of  Base  Rent,  additional  rent, and other  sums  falling  due pursuant to the provisions of this Lease for the period after re-entry during which the Premises  remain vacant, including  late payment charges and interest, which sums shall be payable as they become due hereunder.
	
 

 

	
 
	
D. 
	
For all reasonable expenses  incurred in releasing the Premises, including  leasing commissions,  attorney's fees, and costs  of alteration  or repairs,  which shall  be payable by Tenant as they are incurred by Landlord: and
	
 

 

	
 
	
E. 
	
While the Premises are subject to any new lease or leases made pursuant to this Section,  for the amount  by which  the monthly  installments  payable  under such new lease or leases is less than the monthly installment for all charges payable pursuant to this Lease, which deficiencies shall be payable monthly.
	
 

 

Notwithstanding  Landlord's election to terminate Tenant's right to possession only, and notwithstanding  any  reletting  without  termination,  Landlord,  at any time  thereafter,  may elect to terminate this Lease, and to recover (in lieu of the amounts which would thereafter be payable  pursuant  to  the foregoing,  but  not  in diminution  of  the amounts  payable  as aggregate  sum equal  to the amount  by which the rental  value of the portion of the term unexpired at the time of such election is less than an amount equal  to the unpaid base rent, and additional rent and all other charges which would have been payable by Tenant for the unexpired  portion  of  the term  of this Lease,  which  deficiency  and  all expenses  incident thereto, including commissions, attorney's fees, expenses of alterations and repairs, shall be due to Landlord  as of the time Landlord  exercises  said election, notwithstanding  that the term had not expired.   If Landlord,  after such re-entry,  leases the Premises, then the rent payable  under  such  new  Lease  shall  be conclusive  evidence  of  the  rental  value  of  the unexpired portion of the term of this Lease.

 

 

	
	
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If this Lease shall be terminated  by reason of bankruptcy or insolvency of Tenant, Landlord shall be entitled to recover from Tenant or Tenant's estate, as liquidated damages for loss of bargain  and  not  as  a  penalty,  the  amount  determined   by  the  immediately   preceding paragraph.

	
 
	
11.3 
	
LANDLORD'S  RIGHT  TO  PERFORM FOR  ACCOUNT  OF TENANT.   If Tenant shall  be in Default  under this Lease,  Landlord  may cure the Default at any time for  the account and at the expense  of Tenant.   If Landlord cures a Default on the part of Tenant, Tenant shall reimburse Landlord upon written demand for any reasonable amount actually expended  by Landlord in connection with the cure, including, without limitation, attorney's fees and interest.
	
 

 

	
 
	
11.4 
	
INTEREST  AND LEASE  ENFORCEMENT COSTS.    In  the  event  of  a  Default  by Tenant, then, in addition to all other remedies allowed by this Lease or by law, (a) interest will accrue on any delinquent  sum at the rate of the lesser of eighteen  percent (18%)  per annum or the highest rate permitted  by law, and (b) Tenant  will be liable for all  expenses incurred by Landlord in order to enforce Landlord's rights and remedies on account of that Default. Such enforcement  expenses  include, without  limitation, attorneys' fees (whether or not suit is actually filed, and, if filed, whether or not incurred in seeking a judgment  or order, in defending against any claim or defense raised by Tenant, enforcing a judgment or order, defending a judgment or order on appeal, or successfully  appealing any judgment or order); sheriff's  fees; process server's  fees; filing fees; court imposed fees for obtaining any writ; expert witness fees; and, in the case of each suit filed on account of a Tenant Default (including,  without  limitation,  each  unlawful  detainer  action),  an  automatic  charge  (in addition to the late charge authorized  by Section 2.6), set at the liquidated amount of $300, to cover    additional    landlord    administrative    expense    associated    with    litigation. Furthermore, and whether or not Tenant is in default, Tenant will be liable for all expenses incurred by Landlord in successfully establishing its rights or successfully defending against any claim asserted  by Tenant  in any action in which a  court  or other tribunal  is asked  to adjudicate any such matters.
	
 

 

	
 
	
11.5 
	
ADDITIONAL REMEDIES, WAIVER, ETC.
	
 

 

	
 
	
A.
	
The rights and remedies of Landlord set forth herein shall be in addition    to any other right and remedy now and hereafter provided by law.  All rights and remedies shall be cumulative and not exclusive of each other.  Landlord may exercise its rights and remedies at any time, in any order, to any extent, and as often as Landlord deems advisable without regard to whether the exercise  of one  right or  remedy  precedes,  concurs  with or succeeds     the exercise  of another.
	
 

	
 
	
B.
	
A single or partial exercise of a right or remedy shall not preclude a further exercise thereof, or the exercise of another right or remedy from time to time.
	
 

	
 
	
C.
	
No delay or omission by Landlord in exercising a right or remedy shall exhaust or impair the same or constitute a waiver of, or acquiesce to, a Default.
	
 

	
 
	
D.
	
No waiver of Default shall extend to or affect any other Default or impair any right or remedy with respect thereto.
	
 

	
 
	
E.
	
No action or inaction by Landlord shall constitute a waiver of Default.
	
 

	
 
	
F.
	
No waiver of a Default shall be effective unless it is in writing and signed by Landlord.
	
 

 

 

	
	
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11.6
	
LANDLORD  EVENTS OF DEFAULT.   In the event that Landlord fails to perform any of its obligations  under this Lease and provided that such failure shall continue for a period of thirty (30) days after written notice from Tenant, Tenant, at Tenant's  option and in addition to any other remedies which Tenant may have at law or in equity, and without its actions being deemed a cure of Landlord's  default, Tenant may, at is sole option (i) exercise "self  help" and pay or perform such obligations; or (ii) sue for damages.   In  the event  that Tenant  lawfully  exercises  its right  to "self-help" as contemplated  herein, Landlord shall reimburse  Tenant  for any  reasonable  amounts  incurred  by Tenant within ten (10) days after written demand by Tenant (such written demand to include reasonable supporting documentation  of competitive bids).
	
 

 

ARTICLE 12. RELOCATION- INTENTIONALLY OMITTED 

 

ARTICLE 13. AMENDMENT AND LIMITATION OF WARRANTIES

	
 
	
13.1 
	
ENTIRE  AGREEMENT.  It is expressly agreed by Tenant, as a material consideration for the execution of this Lease, that this Lease, with the specific references to written extrinsic documents, is the entire agreement of the parties:   that there are, and were, no verbal representations, warranties, understandings,  stipulations, agreements or promises pertaining to this Lease or to the expressly  mentioned written extrinsic documents not incorporated in writing in this Lease.
	
 

 

	
 
	
13.2 
	
AMENDMENT.   The Lease may not be altered, waived, amended or extended except by an instrument in writing signed by Landlord and Tenant.
	
 

 

	
 
	
13.3 
	
LIMITATION OF WARRANTIES.   Landlord and Tenant expressly  agree that there are and shall be no implied warranties of merchantability, habitability, fitness for a particular purpose or of any other kind arising out of this Lease, and there are not warranties which extend beyond those expressly set forth in this Lease.
	
 

 

ARTICLE  14. MISCELLANEOUS

 

	
 
	
14.1 
	
SUCCESSORS  AND ASSIGNS.   This  Lease  shall  be  binding  upon  and  inure to the benefit  of  Landlord  and  Tenant  and  their  respective   heirs,  personal  representatives, successors and assigns.  It is hereby covenanted and agreed that should Landlord's  interest in the Premises cease to exist for any reason during this Lease, then notwithstanding  the happening of such event this Lease nevertheless shall remain unimpaired and in full force and effect, and Tenant hereunder agrees to attorn to the then owner of the Premises.
	
 

 

	
 
	
14.2 
	
USE OR RENT TAX.   If applicable  in the jurisdiction  where the Premises are issued, Tenant  shall pay and be liable for all rental, sales and use taxes or other similar taxes, if any,  levied  or  imposed  by  any  city,  state,  county  or  other  governmental  body  having authority,  such  payments to be in addition  to all other  payments  required  to be paid to Landlord under the terms of this Lease.  Any such payment shall be paid concurrently with the payment of the rent, additional  rent, operating  expenses or other charges upon which the tax is based as set forth above.
	
 

 

	
 
	
14.3 
	
ACT OF GOD.  Landlord shall not be required to perform any covenant or obligation  in this  Lease,  or  be  liable  in  damages   to  Tenant,  so  long  as  the  performance  or  non­ performance  of the covenant  or obligation  is delayed,  caused  or prevented  by an act of God, force majeure or by Tenant.
	
 

 

 

	
	
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14.4 
	
HEADINGS.  The section headings appearing in this Lease are inserted only as a matter of convenience  and in no way define,  limit, construe or describe the scope or intent of any Section.
	
 

 

	
 
	
14.5 
	
NOTICE.  All rent and other payments required to be made by Tenant shall be payable to Landlord  at the address set forth  in Section  1.9.   All payments  required  to be made by Landlord to Tenant shall be payable at the address set forth in Section 1.9, or at any other address  within  the  United  States  as  Tenant  may  specify  from  time  to  time  by  written notice. Any notice or document  required or permitted to be delivered  by the terms of this Lease shall be deemed to be delivered (whether or not actually received) when deposited in the United States Mail, postage prepaid, certified mail, return receipt requested, addressed to the parties at the respective addresses set forth in Section 1.9.
	
 

 

	
 
	
14.6 
	
TENANT'S AUTHORITY.   If Tenant executes  this Lease as a corporation, each of the persons  executing  this Lease on  behalf of Tenant  does  hereby  personally  represent  and warrant that Tenant is a duly authorized and existing corporation,  that Tenant is qualified to do business in the state in which the Premises are located, that the corporation  has full right and authority  to enter into this Lease, and that each person signing on behalf of the corporation  is authorized to do so.  In the event any representation or warranty is false, all persons who execute this Lease shall be liable, individually, as Tenant.
	
 

 

	
 
	
14.7 
	
HAZARDOUS  SUBSTANCES.    Tenant  shall  not  bring  or  permit  to  remain  on  the Premises  or  Building  any  asbestos,  petroleum  or  petroleum  products,  explosives,  toxic materials, or substances defined as hazardous wastes, hazardous material, or hazardous substances  under any  federal,  state  or  local  law or  regulation  ("Hazardous  Materials"), unless such materials are properly classed, described, packaged, marked, labeled and in condition for shipment as required or authorized by applicable provisions of Title 49, Code of Federal Regulations, Subtitle B, Chapter I, Subchapter C ("Hazardous Materials Regulations").  Landlord authorizes Tenant to bring or permit to remain on the Premises, as an  integral  part  of  Tenant's  business,  "hazardous   materials"  which  comply  with  the applicable   requirements   or  authorizations   of  Title  49,  Code  of  Federal  Regulations. Tenant's violation  of  the  foregoing  prohibition  shall  constitute  a  material  breach  and default  hereunder  and Tenant  shall  indemnify,  hold harmless and defend  Landlord  from and  against  any  claims,  damages,  penalties,  liabilities,  and  costs  (including  reasonable attorney fees and court costs) caused by or arising out of (i) a violation of the foregoing prohibition  or  (ii)  the  presence  of  any  Hazardous  Materials  on,  under,  or  about  the Premises or the Building during the term of the Lease to the extent caused by Tenant.   In conformance   with  the  requirements  of  applicable   law,  Tenant  shall  immediately  give Landlord  written  notice of any suspected  breach of this paragraph  upon  learning of the presence of any release of any Hazardous Materials, and upon receiving any notices from governmental  agencies  pertaining  to Hazardous  Materials which may affect the Premises or the Building.  The obligations of Tenant hereunder shall survive the expiration of earlier termination, for any reason, of this Lease.
	
 

Notwithstanding  any  provision  in this Lease  to the contrary, Tenant  shall  not have any liability with respect to, and Landlord shall protect, indemnify, defend and hold Tenant harmless  for,  from  and  against  any  and  all  claims,  costs,  expenses,  suits,  judgments, actions,  investigations,  proceedings and liabilities  arising out of or in connection  with (i) any Hazardous  Materials present on the Property or Premises prior to the Commencement Date, (ii) any Hazardous Materials brought onto the Property or the Premises by any third party  (other  than  employees  or  invitees  of  Tenant)  during  the  lease  term  or  (iii)  the migration  of any Hazardous Materials  described  in clauses (i) or (ii) at any time before, during or after the lease term.

 

 

	
	
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14.8 
	
SEVERABILITY. If any provision of this Lease or the application thereof to any person or  circumstances  shall  be invalid  or  unenforceable  to any  extent,  the  remainder  of this Lease and the application of such provisions to other persons or circumstances shall not be affected thereby and shall be enforced to the greatest extent permitted by law.
	
 

 

	
 
	
14.9 
	
LANDLORD'S LIABILITY.  If Landlord shall be in default under this Lease and, if as a consequence  of such default, Tenant  shall  recover  a money judgment  against  Landlord, such judgment shall be satisfied only out of the right, title and interest of Landlord in the Building  as the same  may then  be encumbered  and neither Landlord  nor any  person or entity  comprising  Landlord  shall  be liable for any deficiency.   In no event shall Tenant have the right to levy execution against any property of Landlord nor any person or entity comprising Landlord other than its interest in the Building as herein expressly provided.
	
 

 

	
 
	
14.10
	
BROKERAGE. Landlord and Tenant each represents and warrants to the other that there is no obligation to pay any brokerage fee, commission, finder's  fee or other similar charge in connection with this Lease, other than fees due to Jones Lang LaSalle (the "Tenant's Broker"),   who  represents  the  Tenant.    Landlord  agrees  that  Landlord  shall  be  solely responsible  for paying any and all brokerage  commissions  that are owed to the Tenant's Broker  pursuant  to a separate  commission  agreement.   Each party covenants  that it will defend, indemnify and hold harmless the other party from and against any loss or liability by reason of brokerage or similar services alleged to have been rendered to, at the instance of, or agreed upon by said indemnifying party.
	
 

 

	
 
	
14.11 
	
BROKER  AS OWNER/MANAGEMENT AGENT.   Landlord  hereby  notifies Tenant that the person authorized to execute this Lease and manage the Premises is John N. Allen, who  is  a  licensed  Real  Estate  Broker  in  the  State  of  Minnesota  and  Tenant  hereby acknowledges and consents to this Landlord/Broker relationship.
	
 

 

	
 
	
14.12
	
SUBMISSION  OF LEASE.   Submission  of this Lease to Tenant for signature does not constitute  a reservation  of space or an option  to lease.   This Lease is not effective  until execution  by and delivery to both Landlord and Tenant.
	
 

 

	
 
	
14.13
	
EARLY ACCESS: Provided Tenant does not interfere with Landlord performance of the Landlord's Work  and  provides  Landlord  with  a  certificate  of  liability  insurance  form, Tenant shall have the right to enter the Premises on August 1, 2016 for installation of improvements,  furniture, fixtures,  telecommunications  and equipment  purposes.     During any such early access by Tenant, such early access shall be expressly subject to the terms of this Lease; provided, however,  in no event shall Tenant  be obligated  to pay any Base Rent, additional rent or any other amounts prior to the Commencement  Date. Tenant shall be obligated for utilities (gas and electric) upon access.
	
 

 

	
 
	
14.14
	
OPTION  TO RENEW: By written notice given to Landlord at least twelve (12) monthsprior to the expiration  of the term of this Lease, Tenant may elect to renew this Lease for one (1)  additional  term of five (5) years.   The  renewal  shall be upon all the terms and conditions  of this Lease, except the base rent shall  be at the then prevailing  market  rate with annual increases for similar spaces in the market area and except that the rate shall not be less than the current  rental rate and provided further that Tenant shall have no further renewal options after the first option.  The market rate shall not take into account any value attributable  to  specialized  improvements  Tenant  has  installed  in  the  Premises.    If  the parties  cannot  agree  on  the  amount  of  the  prevailing  market  rate,  the  matter  shall  be submitted  to binding arbitration  in accordance  with the rules of the American  Arbitration Association.   The arbitrator shall be a Real Estate professional with at least (10) years' experience  in evaluating  properties  similar  to this  building.   The arbitrators  determined market rate and annual increases shall take effect as of the renewal date of the Lease.
	
 

 

 

	
	
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14.15 
	
RIGHT OF  FIRST OFFER:  After Landlord  initially leases all contiguous  space at the Lease Premises,  provided Tenant  is not in default under the terms and conditions  of this Lease and provided further that at least four (4) years either remain on the lease term or Tenant  agrees  to modify the lease under terms  and conditions  acceptable  to Landlord  to provide for a total of four (4) years on the total leased premises, then Landlord shall give Tenant  written  notice  that  specifically  defined  (in  the  notice)  space,  contiguous  to  the existing  Premises, is either immediately available  for occupancy or will become available for occupancy  within the next 180 days.   After Landlord gives such notice, Tenant  has a ten (10) business day option to lease this contiguous space, as-is, with no improvements or warranties as to condition, for a term beginning when the space becomes available for occupancy  by Tenant and ending with the term of Tenant's Lease, subject to any option to extend or renew. If, by the end of said ten (10) business day period, Tenant does not inform Landlord  in writing  that Tenant  is electing  to exercise  such  option  for  this  contiguous space,  then Tenant  shall  be deemed  not to have exercised  such option.   The rental  rates used in the Lease will carry over and apply to the contiguous space, provided, though, that Landlord shall have the right to adjust the rate (and will so state in its notice to Tenant), as Landlord  sees fit in its reasonable  discretion,  to reflect any differences  in the quality  or type of space or finish found  in the contiguous  space compared  to the existing  Premises. Example: an upward adjustment  to reflect more office finished space  in the contiguous space.  Landlord  will not lease the contiguous  space  to a third party until Landlord  gives Tenant  the  notice  and  the  ten  (10)  business  day  option  described  herein  to  add  the contiguous  space  to the  Premises  has expired.  If Tenant  does  not exercise  such  option within the ten (10) business days allowed, with time being of the essence, the right of first offer, created in this Section, will expire, whereupon Landlord will have the right to lease the contiguous space to a third party on such terms as Landlord may desire.
	
 

 

	
 
	
14.16 
	
LANDLORD  LIEN  WAIVER.   Landlord  waives any right, title or interest  in Tenant's personal  property  located  on the  Premises,  including,  without  limitation,  any  landlord's lien or other  right or  interest that  would  arise  in law or at equity  or attach  to Tenant's personal property as a result of Tenant's entering into this Lease.
	
 

 

	
	
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IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease effective the day and year first above written.

 

	
LANDLORD:

Industrial Equities Group LLC

a Minnes  a limited liability company
	
 
	
TENANT: 

DJO,LLC

a Delaware limited liability company

	
 
	
 
	
 

	
By:
	
/s/ John N. Allen
	
 
	
By:
	
/s/ Donald M. Roberts

	
 
	
John N. Allen
	
 
	
 
	
 

	
 
	
 
	
 
	
 
	
 

	
Its:
	
Managing Agent
	
 
	
Its:
	
Executive Vice President, General Counsel and Secretary

	
Date:
	
 
	
 
	
Date:
	
 

	
 
	
 
	
 
	
 
	
 

 

 

	
	
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