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  Exhibit 10.1

 

 

 

 

 

 

 

 

HF ENTERPRISES INC.

 

 

 

2018 INCENTIVE
COMPENSATION PLAN

 

 

 

 

 

 

 

 

 

 

 

 

 

HF ENTERPRISES INC.

2018 INCENTIVE
COMPENSATION PLAN

 

1.           Purpose.
HF Enterprises Inc., a Delaware corporation (the
“Company”), hereby establishes the HF ENTERPRISES INC.
2018 INCENTIVE COMPENSATION PLAN (the “Plan”). The
purpose of the Plan is to assist the Company and its Related
Entities (as hereinafter defined) in attracting, motivating,
retaining and rewarding high-quality executives and other
employees, officers, directors, consultants and other persons who
provide services to the Company or its Related Entities by enabling
such persons to acquire or increase a proprietary interest in the
Company in order to strengthen the mutuality of interests between
such persons and the Company’s shareholders, and providing
such persons with performance incentives to expend their maximum
efforts in the creation of shareholder value.

 

2.           Definitions.
For purposes of the Plan, the following terms shall be defined as
set forth below, in addition to such terms defined in Section 1
hereof.

 

(a)           “Award”
means any Option, Stock Appreciation Right, Restricted Stock Award,
Restricted Stock Unit Award, Deferred Stock Award, Share granted as
a bonus or in lieu of another award, Dividend Equivalent, Other
Stock-Based Award or Performance Award, together with any other
right or interest, granted to a Participant under the
Plan.

 

(b)           “Award
Agreement” means any written agreement, contract or
other instrument or document evidencing any Award granted by the
Committee hereunder.

 

(c)           “Beneficiary”
means the person, persons, trust or trusts that have been
designated by a Participant in his or her most recent written
beneficiary designation filed with the Committee to receive the
benefits specified under the Plan upon such Participant’s
death or to which Awards or other rights are transferred if and to
the extent permitted under Section 10(b) hereof. If, upon a
Participant’s death, there is no designated Beneficiary or
surviving designated Beneficiary, then the term Beneficiary means
the person, persons, trust or trusts entitled by will or the laws
of descent and distribution to receive such benefits.

 

(d)           “Beneficial
Owner” shall have the meaning ascribed to such term in
Rule 13d-3 under the Exchange Act and any successor to such
Rule.

 

(e)           “Board”
means the Company’s Board of Directors.

 

(f)           “Cause”
shall, with respect to any Participant have the meaning specified
in the Award Agreement. In the absence of any definition in the
Award Agreement, “Cause” shall have the equivalent
meaning or the same meaning as “cause” or “for
cause” set forth in any employment, consulting, or other
agreement for the performance of services between the Participant
and the Company or a Related Entity or, in the absence of any such
agreement or any such definition in such agreement, such term shall
mean (i) the failure by the Participant to perform, in a reasonable
manner, his or her duties as assigned by the Company or a Related
Entity, (ii) any violation or breach by the Participant of his or
her employment, consulting or other similar agreement with the
Company or a Related Entity, if any, (iii) any violation or breach
by the Participant of any non-competition, non-solicitation,
non-disclosure and/or other similar agreement with the Company or a
Related Entity, (iv) any act by the Participant of dishonesty or
bad faith with respect to the Company or a Related Entity, (v) use
of alcohol, drugs or other similar substances in a manner that
adversely affects the Participant’s work performance, or (vi)
the commission by the Participant of any act, misdemeanor, or crime
reflecting unfavorably upon the Participant or the Company or any
Related Entity. The good faith determination by the Committee of
whether the Participant’s Continuous Service was terminated
by the Company for “Cause” shall be final and binding
for all purposes hereunder.

 

 

2

 

 

(g)         
“Change in
Control” means a Change in Control as defined with
related terms in Section 9(b) of the Plan.

 

(h)         
“Code”
means the Internal Revenue Code of 1986, as amended from time to
time, including regulations thereunder and successor provisions and
regulations thereto.

 

(i)           “Committee”
means a committee designated by the Board to administer the Plan;
provided,
however, that if
the Board fails to designate a committee or if there are no longer
any members on the committee so designated by the Board, then the
Board shall serve as the Committee. The Committee shall consist of
at least two directors, and each member of the Committee shall be
(i) a “non-employee director” within the meaning
of Rule 16b-3 (or any successor rule) under the Exchange Act,
unless administration of the Plan by “non-employee
directors” is not then required in order for exemptions under
Rule 16b-3 to apply to transactions under the Plan and (ii) an
“independent director” under theNASDAQ listing
requirements, or any similar rule or listing requirement that may
be applicable to the Company from time to time.

 

(j)           “Consultant”
means any person (other than an Employee or a Director, solely with
respect to rendering services in such person’s capacity as a
director) who is engaged by the Company or any Related Entity to
render consulting or advisory services to the Company or such
Related Entity.

 

(k)         
“Continuous
Service” means the uninterrupted provision of services
to the Company or any Related Entity in any capacity of Employee,
Director, Consultant or other service provider. Continuous Service
shall not be considered to be interrupted in the case of (i) any
approved leave of absence, (ii) transfers among the Company, any
Related Entities, or any successor entities, in any capacity of
Employee, Director, Consultant or other service provider, or (iii)
any change in status as long as the individual remains in the
service of the Company or a Related Entity in any capacity of
Employee, Director, Consultant or other service provider (except as
otherwise provided in the Award Agreement). An approved leave of
absence shall include sick leave, military leave, or any other
authorized personal leave. For purposes of each Incentive Stock
Option granted under the Plan, if such leave exceeds three (3)
months, and reemployment upon expiration of such leave is not
guaranteed by statute or contract, then the Incentive Stock Option
shall be treated as a Non-Qualified Stock Option on the day three
(3) months and one (1) day following the expiration of such three
(3) month period.

 

(l)           “Deferred
Stock” means a right to receive Shares, including
Restricted Stock, cash or a combination thereof, at the end of a
specified deferral period.

 

 

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(m)         
“Deferred Stock
Award” means an Award of Deferred Stock granted to a
Participant under Section 6(e) hereof.

 

(n)           “Director”
means a member of the Board or the board of directors of any
Related Entity.

 

(o)           “Disability”
means a permanent and total disability (within the meaning of
Section 22(e) of the Code), as determined by a medical doctor
satisfactory to the Committee. Notwithstanding the foregoing, for
Awards subject to Section 409A of the Code, Disability shall mean
that a Participant is disabled under Section 409A(a)(2)(C)(i) or
(ii) of the Code.

 

(p)           “Dividend
Equivalent” means a right, granted to a Participant
under Section 6(g) hereof, to receive cash, Shares, other Awards or
other property equal in value to dividends paid with respect to a
specified number of Shares, or other periodic
payments.

 

(q)           “Effective
Date” has the meaning set forth in Section
10(s).

 

(r)           
“Eligible
Person” means each officer, Director, Employee,
Consultant and other person who provides services to the Company or
any Related Entity. The foregoing notwithstanding, only Employees
of the Company, or any parent corporation or subsidiary corporation
of the Company (as those terms are defined in Sections 424(e) and
(f) of the Code, respectively), shall be Eligible Persons for
purposes of receiving any Incentive Stock Options. An Employee on
leave of absence may be considered as still in the employ of the
Company or a Related Entity for purposes of eligibility for
participation in the Plan.

 

(s)     
    “Employee” means any
person, including an officer or Director, who is an employee of the
Company or any Related Entity. The payment of a director’s
fee by the Company or a Related Entity shall not be sufficient to
constitute “employment” by the Company.

 

(t)           “Exchange
Act” means the Securities Exchange Act of 1934, as
amended from time to time, including rules thereunder and successor
provisions and rules thereto.

 

(u)         
“Fair Market
Value” or “FMV” means, as of any
date, the value of a Share determined as follows:

 

(i)           If
the Share is listed on one or more established stock exchanges or
national market systems, including without limitation, The NASDAQ
Global Select Market, The NASDAQ Global Market or The NASDAQ
Capital Market of The NASDAQ Stock Market LLC, its Fair Market
Value shall be the closing sales price for such Share (or the
closing bid, if no sales were reported) as quoted on the principal
exchange or system on which the Share is listed (as determined by
the Committee) on the date of determination (or, if no closing
sales price or closing bid was reported on that date, as
applicable, on the last immediately preceding trading date such
closing sales price or closing bid was reported), as reported in
The Wall Street Journal or
such other source as the Committee deems reliable;

 

 

4

 

 

(ii)           If
the Share is regularly quoted on an automated quotation system
(including a marketplace operated by the OTC Markets Group, Inc.)
or by a recognized securities dealer, its Fair Market Value shall
be the closing sales price for such Share as quoted on such system
or by such securities dealer on the date of determination, but if
selling prices are not reported, the Fair Market Value of a Share
shall be the mean between the high bid and low asked prices for the
Share on the date of determination (or, if no such prices were
reported on that date, on the last date such prices were reported),
as reported in The Wall Street
Journal or such other source as the Committee deems
reliable; or

 

(iii)         
In the absence of an established market for the Share of the type
described in (i) and (ii), above, the Fair Market Value thereof
shall be determined by the Committee in good faith using any
reasonable method of valuation, which method may be set forth with
greater specificity in the Award Agreement, (and, to the extent
necessary or advisable, in a manner consistent with Section 409A of
the Code and Section 422 of the Code for Incentive Stock Options),
which determination shall be conclusive and binding on all
interested parties. Such reasonable method may be determined by
reference to (i) the placing price of the latest private placement
of the Shares and the development of the Company’s business
operations and the general economic and market conditions since
such latest private placement; (ii) other third party transactions
involving the Shares and the development of the Company’s
business operation and the general economic and market conditions
since such sale; (iii) an independent valuation of the Shares (by a
qualified valuation expert) or (iv) such other methodologies or
information as the Committee determines to be indicative of Fair
Market Value.

 

(v)           “Good
Reason” shall, with respect to any Participant, have
the meaning specified in the Award Agreement. In the absence of any
definition in the Award Agreement, “Good Reason” shall
have the equivalent meaning or the same meaning as “good
reason” or “for good reason” set forth in any
employment, consulting or other agreement for the performance of
services between the Participant and the Company or a Related
Entity or, in the absence of any such agreement or any such
definition in such agreement, such term shall mean (i) the
assignment to the Participant of any duties inconsistent in any
material respect with the Participant’s position, authority,
duties or responsibilities as assigned by the Company or a Related
Entity, or any other action by the Company or a Related Entity
which results in a material diminution in such position, authority,
duties or responsibilities, excluding for this purpose any action
not taken in bad faith and which is remedied by the Company or a
Related Entity promptly after receipt of notice thereof given by
the Participant, or any action taken with the consent of the
Participant; or (ii) any material failure by the Company or a
Related Entity to comply with its obligations to the Participant as
agreed upon, other than any failure not occurring in bad faith and
which is remedied by the Company or a Related Entity promptly after
receipt of notice thereof given by the Participant.

 

(w)           “Incentive
Stock Option” means any Option intended to be
designated as an “incentive stock option” within the
meaning of Section 422 of the Code or any successor provision
thereto and that meets the requirements set out in the
Plan.

 

(x)           “Independent,”
when referring to either the Board or members of the Committee,
shall have the same meaning as used in the rules of NASDAQ or any
national securities exchange on which any securities of the Company
are listed for trading and, if not quoted or listed for trading, by
the rules of NASDAQ.

 

 

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(y)           “Incumbent
Board” means the Incumbent Board as defined in Section
9(b)(ii) of the Plan.

 

(z)           “Non-Qualified
Stock Option” means an Option that, by its terms, does
not qualify or is not intended to qualify as an Incentive Stock
Option.

 

(aa)        
“Option” means a right
granted to a Participant under Section 6(b) hereof, to purchase
Shares or other Awards at a specified price during specified time
periods.

 

(bb)        
“Optionee” means a person
to whom an Option is granted under this Plan or any person who
succeeds to the rights of such person under this Plan.

 

(cc)         
“Other Stock-Based
Awards” means Awards granted to a Participant under
Section 6(i) hereof.

 

(dd)         
“Outside
Director” means a member of the Board who is not an
Employee.

 

(ee)           “Participant”
means a person who has been granted an Award under the Plan which
remains outstanding, including a person who is no longer an
Eligible Person.

 

(ff)        
   “Performance Award” shall
mean any Award of Performance Shares or Performance Units granted
pursuant to Section 6(h).

 

(gg)         
“Performance
Period” means that period established by the Committee
at the time any Performance Award is granted or at any time
thereafter during which any performance goals specified by the
Committee with respect to such Award are to be
measured.

 

(hh)         
“Performance
Share” means any grant pursuant to Section 6(h) of a
unit valued by reference to a designated number of Shares, which
value may be paid to the Participant by delivery of such property
as the Committee shall determine, including cash, Shares, other
property, or any combination thereof, upon achievement of such
performance goals during the Performance Period as the Committee
shall establish at the time of such grant or
thereafter.

 

(ii)    
       “Performance Unit” means
any grant pursuant to Section 6(h) of a unit valued by reference to
a designated amount of property (including cash) other than Shares,
which value may be paid to the Participant by delivery of such
property as the Committee shall determine, including cash, Shares,
other property, or any combination thereof, upon achievement of
such performance goals during the Performance Period as the
Committee shall establish at the time of such grant or
thereafter.

 

(jj)      
      “Person” shall have the
meaning ascribed to such term in Section 3(a)(9) of the
Exchange Act and used in Sections 13(d) and 14(d) thereof, and
shall include a “group” as defined in Section 13(d)
thereof.

 

(kk)         
“Related
Entity” means any Subsidiary, and any business,
corporation, partnership, limited liability company or other entity
designated by Board in which the Company or a Subsidiary holds a
substantial ownership interest, directly or
indirectly.

 

 

 

6

 

 

(ll)           “Restricted
Stock” means any Share issued with the restriction
that the holder may not sell, transfer, pledge or assign such Share
and with such risks of forfeiture and other restrictions as the
Committee, in its sole discretion, may impose (including any
restriction on the right to vote such Share and the right to
receive any dividends), which restrictions may lapse separately or
in combination at such time or times, in installments or otherwise,
as the Committee may deem appropriate.

 

(mm)       
“Restricted Stock
Award” means an Award granted to a Participant under
Section 6(d) hereof.

 

(nn)         
“Restricted Stock
Unit” means an Award granted to a Participant under
Section 6(d) hereof.

 

(oo)         
“Rule
16b-3” means Rule 16b-3, as from time to time in
effect and applicable to the Plan and Participants, promulgated by
the Securities and Exchange Commission under Section 16 of the
Exchange Act.

 

(pp)         
“Shares” means the shares
of common stock of the Company, par value $.001 per share, and such
other securities as may be substituted (or resubstituted) for
Shares pursuant to Section 10(c) hereof.

 

(qq)         
“Stock Appreciation
Right” means a right granted to a Participant under
Section 6(c) hereof.

 

(rr)      
    “Subsidiary” means any
corporation or other entity in which the Company has a direct or
indirect ownership interest of 50% or more of the total combined
voting power of the then outstanding securities or interests of
such corporation or other entity entitled to vote generally in the
election of directors or in which the Company has the right to
receive 50% or more of the distribution of profits or 50% or more
of the assets on liquidation or dissolution.

 

(ss)           “Substitute
Awards” shall mean Awards granted or Shares issued by
the Company in assumption of, or in substitution or exchange for,
awards previously granted, or the right or obligation to make
future awards, by a company acquired by the Company or any Related
Entity or with which the Company or any Related Entity
combines.

 

3.           Administration.

 

(a)           Authority
of the Committee. The Plan shall be administered by the
Committee, except to the extent the Board elects to administer the
Plan, in which case the Plan shall be administered by only those
directors who are Independent Directors, in which case references
herein to the “Committee” shall be deemed to include
references to the Independent members of the Board. The Committee
shall have full and final authority, subject to and consistent with
the provisions of the Plan, to select Eligible Persons to become
Participants, grant Awards, determine the type, number and other
terms and conditions of, and all other matters relating to, Awards,
prescribe Award Agreements (which need not be identical for each
Participant) and rules and regulations for the administration of
the Plan, construe and interpret the Plan and Award Agreements and
correct defects, supply omissions or reconcile inconsistencies
therein, and to make all other decisions and determinations as the
Committee may deem necessary or advisable for the administration of
the Plan. In exercising any discretion granted to the Committee
under the Plan or pursuant to any Award, the Committee shall not be
required to follow past practices, act in a manner consistent with
past practices, or treat any Eligible Person or Participant in a
manner consistent with the treatment of other Eligible Persons or
Participants.

 

 

7

 

 

(b)           Manner
of Exercise of Committee Authority. The Committee, and not
the Board, shall exercise sole and exclusive discretion on any
matter relating to a Participant then subject to Section 16 of
the Exchange Act with respect to the Company to the extent
necessary in order that transactions by such Participant shall be
exempt under Rule 16b-3 under the Exchange Act. Any action of the
Committee shall be final, conclusive and binding on all persons,
including the Company, its Related Entities, Participants,
Beneficiaries, transferees under Section 10(b) hereof or other
persons claiming rights from or through a Participant, and
shareholders. The express grant of any specific power to the
Committee, and the taking of any action by the Committee, shall not
be construed as limiting any power or authority of the Committee.
The Committee may delegate to officers or managers of the Company
or any Related Entity, or committees thereof, the authority,
subject to such terms as the Committee shall determine, to perform
such functions, including administrative functions as the Committee
may determine to the extent that such delegation will not result in
the loss of an exemption under Rule 16b-3(d)(1) for Awards granted
to Participants subject to Section 16 of the Exchange Act in
respect of the Company. The Committee may appoint agents to assist
it in administering the Plan.

 

(c)           Limitation
of Liability. The Committee and the Board, and each member
thereof, shall be entitled to, in good faith, rely or act upon any
report or other information furnished to him or her by any officer
or Employee, the Company’s independent auditors, Consultants
or any other agents assisting in the administration of the Plan.
Members of the Committee and the Board, and any officer or Employee
acting at the direction or on behalf of the Committee or the Board,
shall not be personally liable for any action or determination
taken or made in good faith with respect to the Plan, and shall, to
the extent permitted by law, be fully indemnified and protected by
the Company with respect to any such action or
determination.

 

4.           Shares
Subject to Plan.

 

(a)           Limitation
on Overall Number of Shares Available for Delivery Under
Plan. Subject to adjustment as provided in Section 10(c)
hereof, the total number of Shares reserved and available for
delivery under the Plan shall be Five Hundred Thousand (500,000),
all of which may be Incentive Stock Options. Any Shares delivered
under the Plan may consist, in whole or in part, of authorized and
unissued shares or treasury shares.

 

(b)           Application
of Limitation to Grants of Award. No Award may be granted if
the number of Shares to be delivered in connection with such an
Award or, in the case of an Award relating to Shares but settled
only in cash (such as cash-only Stock Appreciation Rights), the
number of Shares to which such Award relates, exceeds the number of
Shares remaining available for delivery under the Plan, minus the
number of Shares deliverable in settlement of or relating to then
outstanding Awards. The Committee may adopt reasonable counting
procedures to ensure appropriate counting, avoid double counting
(as, for example, in the case of tandem or substitute awards) and
make adjustments if the number of Shares actually delivered differs
from the number of Shares previously counted in connection with an
Award.

 

 

8

 

 

(c)           Share
Accounting. Without limiting the discretion of the Committee
under this section, the following rules will apply for purposes of
the determination of the number of Shares available for grant under
the Plan or compliance with the foregoing limits:

 

(i)           If
an outstanding Award for any reason expires or is terminated or
canceled without having been exercised or settled in full, or if
Shares acquired pursuant to an Award subject to forfeiture are
forfeited under the terms of the Plan or the relevant Award, the
Shares allocable to the terminated portion of such Award or such
forfeited Shares shall again be available for issuance under the
Plan.

 

(ii)         
Shares shall not be deemed to have been issued pursuant to the Plan
with respect to any portion of an Award that is settled in cash,
other than an Option.

 

(iii)        
If the exercise price of an Option is paid by tender to the
Company, or attestation to the ownership, of Shares owned by the
Participant, or an Option is settled without the payment of the
exercise price, or the payment of taxes with respect to any Award
is settled by a net exercise, the number of shares available for
issuance under the Plan shall be reduced by the gross number of
shares for which the Option is exercised or other Awards that have
vested.

 

(iv)        
Substitute Awards shall not reduce the Shares authorized for grant
under the Plan or authorized for grant to a Participant in any
period. Additionally, in the event that a company acquired by the
Company or any Related Entity or with which the Company or any
Related Entity combines has shares available under a pre-existing
plan approved by shareholders and not adopted in contemplation of
such acquisition or combination, the shares available for delivery
pursuant to the terms of such pre-existing plan (as adjusted, to
the extent appropriate, using the exchange ratio or other
adjustment or valuation ratio or formula used in such acquisition
or combination to determine the consideration payable to the
holders of common stock of the entities party to such acquisition
or combination) may be used for Awards under the Plan and shall not
reduce the Shares authorized for delivery under the Plan; provided
that Awards using such available shares shall not be made after the
date awards or grants could have been made under the terms of the
pre-existing plan, absent the acquisition or combination, and shall
only be made to individuals who were not Employees or Directors
prior to such acquisition or combination.

 

(v)         
Any Shares that again become available for delivery pursuant to
this Section 4(c) shall be added back as one (1)
Share.

 

(vi)        
Notwithstanding anything in this Section 4(c) to the contrary and
solely for purposes of determining whether Shares are available for
the delivery of Incentive Stock Options, the maximum aggregate
number of shares that may be granted under this Plan shall be
determined without regard to any Shares restored pursuant to this
Section 4(c) that, if taken into account, would cause the Plan to
fail the requirement under Code Section 422 that the Plan designate
a maximum aggregate number of shares that may be
issued.

 

 

9

 

 

(d)           Limitation
on Number of Shares Granted to Outside Directors.
Notwithstanding any provision in the Plan to the contrary, the sum
of the grant date Fair Market Value of equity-based Awards and the
amount of any cash-based Awards granted to an Outside Director
during any calendar year shall not exceed Five Hundred Thousand
dollars ($500,000).

 

5.           Eligibility
and Participation. Individuals eligible to participate in
the Plan include all Employees, Directors, and all Consultants and
advisers to the Company and Related Entities, as determined by the
Committee. Subject to the provisions of the Plan, the Committee
may, from time to time, select from all Eligible Persons, those to
whom Awards shall be granted and shall determine, in its sole
discretion, the nature of, any and all terms permissible by law,
and the amount of each Award. In making this determination, the
Committee may consider any factors it deems relevant, including
without limitation, the office or position held by a Participant or
the Participant’s relationship to the Company, the
Participant’s degree of responsibility for and contribution
to the growth and success of the Company or any Related Entity, the
Participant’s length of service, promotions and
potential.

 

6.           Specific
Terms of Awards.

 

(a)           General.
Awards may be granted on the terms and conditions set forth in this
Section 6. In addition, the Committee may impose on any Award or
the exercise thereof, at the date of grant or thereafter (subject
to Section 10(e)), such additional terms and conditions, not
inconsistent with the provisions of the Plan, as the Committee
shall determine, including terms requiring forfeiture of Awards in
the event of termination of the Participant’s Continuous
Service and terms permitting a Participant to make elections
relating to his or her Award. The Committee shall retain full power
and discretion to accelerate, waive or modify, at any time, any
term or condition of an Award that is not mandatory under the Plan.
Except in cases in which the Committee is authorized to require
other forms of consideration under the Plan, or to the extent other
forms of consideration must be paid to satisfy the requirements of
applicable law, no consideration other than services may be
required for the grant (but not the exercise) of any
Award.

 

(b)           Options.
The Committee is authorized to grant Options to any Eligible Person
on the following terms and conditions:

 

(i)           Exercise
Price. Other than in connection with Substitute Awards, the
exercise price per Share purchasable under an Option shall be
determined by the Committee, provided that such exercise price
shall not be less than 100% of the Fair Market Value of a Share on
the date of grant of the Option and shall not, in any event, be
less than the par value of a Share on the date of grant of the
Option. If an Employee owns or is deemed to own (by reason of the
attribution rules applicable under Section 424(d) of the Code) more
than 10% of the combined voting power of all classes of stock of
the Company (or any parent corporation or subsidiary corporation of
the Company, as those terms are defined in Sections 424(e) and (f)
of the Code, respectively) and an Incentive Stock Option is granted
to such employee, the exercise price of such Incentive Stock Option
(to the extent required by the Code at the time of grant) shall be
no less than 110% of the Fair Market Value a Share on the date such
Incentive Stock Option is granted.

 

 

10

 

 

(ii)           Time
and Method of Exercise. The Committee shall determine the
time or times at which or the circumstances under which an Option
may be exercised in whole or in part (including based on
achievement of performance goals and/or future service
requirements), the time or times at which Options shall cease to be
or become exercisable following termination of Continuous Service
or upon other conditions, the methods by which the exercise price
may be paid or deemed to be paid (including in the discretion of
the Committee a cashless exercise procedure), the form of such
payment, including, without limitation, cash, Shares, other Awards
or awards granted under other plans of the Company or a Related
Entity, or other property (including notes or other contractual
obligations of Participants to make payment on a deferred basis
provided that such deferred payments are not in violation of
Section 409A of the Code, or any rule or regulation adopted
thereunder or any other applicable law), and the methods by or
forms in which Shares will be delivered or deemed to be delivered
to Participants.

 

(iii)           Incentive
Stock Options. The terms of any Incentive Stock Option
granted under the Plan shall comply in all respects with the
provisions of Section 422 of the Code. If an Option is intended to
be an Incentive Stock Option, and if, for any reason, such Option
(or any portion thereof) shall not qualify as an Incentive Stock
Option, then, to the extent of such nonqualification, such Option
(or portion thereof) shall be regarded as a Non-Qualified Stock
Option appropriately granted under the Plan; provided that such
Option (or portion thereof) otherwise complies with the
Plan’s requirements relating to Non-Qualified Stock Options.
Anything in the Plan to the contrary notwithstanding, no term of
the Plan relating to Incentive Stock Options (including any Stock
Appreciation Right issued in tandem therewith) shall be
interpreted, amended or altered, nor shall any discretion or
authority granted under the Plan be exercised, so as to disqualify
either the Plan or any Incentive Stock Option under Section 422 of
the Code, unless the Participant has first requested, or consents
to, the change that will result in such disqualification. Thus, if
and to the extent required to comply with Section 422 of the Code,
Options granted as Incentive Stock Options shall be subject to the
following special terms and conditions:

 

(A)           an
Incentive Stock Option shall not be exercisable more than ten years
after the date such Incentive Stock Option is granted; provided, however, that if a Participant
owns or is deemed to own (by reason of the attribution rules of
Section 424(d) of the Code) more than 10% of the combined voting
power of all classes of stock of the Company (or any parent
corporation or subsidiary corporation of the Company, as those
terms are defined in Sections 424(e) and (f) of the Code,
respectively) and the Incentive Stock Option is granted to such
Participant, the term of the Incentive Stock Option shall be (to
the extent required by the Code at the time of the grant) for no
more than five years from the date of grant; and

 

(B)           The
aggregate Fair Market Value (determined as of the date the
Incentive Stock Option is granted) of the Shares with respect to
which Incentive Stock Options granted under the Plan and all other
option plans of the Company (and any parent corporation or
subsidiary corporation of the Company, as those terms are defined
in Sections 424(e) and (f) of the Code, respectively) during any
calendar year exercisable for the first time by the Participant
during any calendar year shall not (to the extent required by the
Code at the time of the grant) exceed $100,000. To the extent that
Incentive Stock Options are first exercisable by a Participant in
excess of such limitation, the excess shall be considered
Non-Qualified Stock Options.

 

 

11

 

 

(C)           Each
person exercising any Incentive Stock Option granted under the Plan
shall be deemed to have covenanted with the Company to report to
the Company any disposition of such Shares prior to the expiration
of the holding periods specified by Section 422(a)(1) of the Code
and, if and to the extent that the realization of income in such a
disposition imposes upon the Company federal, state, local or other
withholding tax requirements, or any such withholding is required
to secure for the Company an otherwise available tax deduction, to
remit to the Company an amount in cash sufficient to satisfy those
requirements.

 

(c)           Stock
Appreciation Rights. The Committee may grant Stock
Appreciation Rights to any Eligible Person in conjunction with all
or part of any Option granted under the Plan or at any subsequent
time during the term of such Option (a “Tandem Stock
Appreciation Right”), or without regard to any Option (a
“Freestanding Stock Appreciation Right”), in each case
upon such terms and conditions as the Committee may establish in
its sole discretion, not inconsistent with the provisions of the
Plan, including the following:

 

(i)           Right
to Payment. A Stock Appreciation Right shall confer on the
Participant to whom it is granted a right to receive, upon exercise
thereof, the excess of (A) the Fair Market Value of one Share on
the date of exercise over (B) the grant price of the Stock
Appreciation Right as determined by the Committee. The grant price
of a Stock Appreciation Right shall not be less than 100% of the
Fair Market Value of a Share on the date of grant, in the case of a
Freestanding Stock Appreciation Right, or less than the associated
Option exercise price, in the case of a Tandem Stock Appreciation
Right.

 

(ii)         
Other Terms. The Committee
shall determine at the date of grant or thereafter, the time or
times at which and the circumstances under which a Stock
Appreciation Right may be exercised in whole or in part (including
based on achievement of performance goals and/or future service
requirements), the time or times at which Stock Appreciation Rights
shall cease to be or become exercisable following termination of
Continuous Service or upon other conditions, the method of
exercise, method of settlement, form of consideration payable in
settlement, method by or forms in which Shares will be delivered or
deemed to be delivered to Participants, whether or not a Stock
Appreciation Right shall be in tandem or in combination with any
other Award, and any other terms and conditions of any Stock
Appreciation Right.

 

(iii)        
Tandem Stock Appreciation
Rights. Any Tandem Stock Appreciation Right may be granted
at the same time as the related Option is granted or, for Options
that are not Incentive Stock Options, at any time thereafter before
exercise or expiration of such Option. Any Tandem Stock
Appreciation Right related to an Option may be exercised only when
the related Option would be exercisable and the Fair Market Value
of the Shares subject to the related Option exceeds the exercise
price at which Shares can be acquired pursuant to the Option. In
addition, if a Tandem Stock Appreciation Right exists with respect
to less than the full number of Shares covered by a related Option,
then an exercise or termination of such Option shall not reduce the
number of Shares to which the Tandem Stock Appreciation Right
applies until the number of Shares then exercisable under such
Option equals the number of Shares to which the Tandem Stock
Appreciation Right applies. Any Option related to a Tandem Stock
Appreciation Right shall no longer be exercisable to the extent the
Tandem Stock Appreciation Right has been exercised, and any Tandem
Stock Appreciation Right shall no longer be exercisable to the
extent the related Option has been exercised.

 

 

12

 

 

(d)           Restricted
Stock Awards. The Committee is authorized to grant
Restricted Stock Awards to any Eligible Person on the following
terms and conditions:

 

(i)           Grant
and Restrictions. Restricted Stock Awards shall be subject
to such restrictions on transferability, risk of forfeiture and
other restrictions, if any, as the Committee may impose, or as
otherwise provided in this Plan, covering a period of time
specified by the Committee (the “Restriction Period”).
The terms of any Restricted Stock Award granted under the Plan
shall be set forth in a written Award Agreement which shall contain
provisions determined by the Committee and not inconsistent with
the Plan. The restrictions may lapse separately or in combination
at such times, under such circumstances (including based on
achievement of performance goals and/or future service
requirements), in such installments or otherwise, as the Committee
may determine at the date of grant or thereafter. Except to the
extent restricted under the terms of the Plan and any Award
Agreement relating to a Restricted Stock Award, a Participant
granted Restricted Stock shall have all of the rights of a
shareholder, including the right to vote the Restricted Stock and
the right to receive dividends thereon (subject to any mandatory
reinvestment or other requirement imposed by the Committee). During
the Restriction Period, subject to Section 10(b) below, the
Restricted Stock may not be sold, transferred, pledged,
hypothecated, margined or otherwise encumbered by the
Participant.

 

(ii)           Forfeiture.
Except as otherwise determined by the Committee, upon termination
of a Participant’s Continuous Service during the applicable
Restriction Period, the Participant’s Restricted Stock that
is at that time subject to a risk of forfeiture that has not lapsed
or otherwise been satisfied shall be forfeited and reacquired by
the Company; provided that the Committee may provide, by rule or
regulation or in any Award Agreement, or may determine in any
individual case, that forfeiture conditions relating to Restricted
Stock Awards shall be waived in whole or in part in the event of
terminations resulting from specified causes.

 

(iii)         
Certificates for Stock.
Restricted Stock granted under the Plan may be evidenced in such
manner as the Committee shall determine. If certificates
representing Restricted Stock are registered in the name of the
Participant, the Committee may require that such certificates bear
an appropriate legend referring to the terms, conditions and
restrictions applicable to such Restricted Stock, that the Company
retain physical possession of the certificates, and that the
Participant deliver a stock power to the Company, endorsed in
blank, relating to the Restricted Stock.

 

(iv)         
Dividends and Splits. As a
condition to the grant of a Restricted Stock Award, the Committee
may require or permit a Participant to elect that any cash
dividends paid on a Share of Restricted Stock be automatically
reinvested in additional Shares of Restricted Stock or applied to
the purchase of additional Awards under the Plan. Unless otherwise
determined by the Committee, Shares distributed in connection with
a stock split or stock dividend, and other property distributed as
a dividend, shall be subject to restrictions and a risk of
forfeiture to the same extent as the Restricted Stock with respect
to which such Shares or other property have been
distributed.

 

 

13

 

 

(v)           Restricted
Stock Units. In lieu of or in addition to Restricted Stock,
the Committee is authorized to grant Restricted Stock Units to any
Eligible Person. Restricted Stock Units shall be subject to the
same terms and conditions under this Plan as Restricted Stock
except as otherwise provided in this Plan or as otherwise provided
by the Committee. Except as otherwise provided by the Committee,
the award shall be settled and paid out promptly upon vesting (to
the extent permitted by Section 409A of the Code), and the
Participant holding such Restricted Stock Units shall receive, as
determined by the Committee, Shares (or cash equal to the Fair
Market Value of the number of Shares as of the date the Award
becomes payable) equal to the number of such Restricted Stock
Units. Restricted Stock Units shall not be transferable, shall have
no voting rights, and, unless otherwise determined by the
Committee, shall not receive dividends or Dividend Equivalents
(which in any event shall only be paid out to the extent that the
Restricted Stock Units vest).

 

(e)           Deferred
Stock Award. The Committee is authorized to grant Deferred
Stock Awards to any Eligible Person on the following terms and
conditions:

 

(i)           Award
and Restrictions. Satisfaction of a Deferred Stock Award
shall occur upon expiration of the deferral period specified for
such Deferred Stock Award by the Committee (or, if permitted by the
Committee, as elected by the Participant). In addition, a Deferred
Stock Award shall be subject to such restrictions (which may
include a risk of forfeiture) as the Committee may impose, if any,
which restrictions may lapse at the expiration of the deferral
period or at earlier specified times (including based on
achievement of performance goals and/or future service
requirements), separately or in combination, in installments or
otherwise, as the Committee may determine. A Deferred Stock Award
may be satisfied by delivery of Shares, cash equal to the Fair
Market Value of the specified number of Shares covered by the
Deferred Stock, or a combination thereof, as determined by the
Committee at the date of grant or thereafter. Prior to satisfaction
of a Deferred Stock Award, a Deferred Stock Award carries no voting
or dividend or other rights associated with Share
ownership.

 

(ii)         
Forfeiture. Except as
otherwise determined by the Committee, upon termination of a
Participant’s Continuous Service during the applicable
deferral period or portion thereof to which forfeiture conditions
apply (as provided in the Award Agreement evidencing the Deferred
Stock Award), the Participant’s Deferred Stock Award that is
at that time subject to a risk of forfeiture that has not lapsed or
otherwise been satisfied shall be forfeited; provided that the
Committee may provide, by rule or regulation or in any Award
Agreement, or may determine in any individual case, that forfeiture
conditions relating to a Deferred Stock Award shall be waived in
whole or in part in the event of terminations resulting from
specified causes, and the Committee may in other cases waive in
whole or in part the forfeiture of any Deferred Stock
Award.

 

 

14

 

 

(f)           Bonus
Stock and Awards in Lieu of Obligations. The Committee is
authorized to grant Shares to any Eligible Persons as a bonus, or
to grant Shares or other Awards in lieu of obligations to pay cash
or deliver other property under the Plan or under other plans or
compensatory arrangements, provided that, in the case of Eligible
Persons subject to Section 16 of the Exchange Act, the amount of
such grants remains within the discretion of the Committee to the
extent necessary to ensure that acquisitions of Shares or other
Awards are exempt from liability under Section 16(b) of the
Exchange Act. Shares or Awards granted hereunder shall be subject
to such other terms as shall be determined by the
Committee.

 

(g)           Dividend
Equivalents. The Committee is authorized to grant Dividend
Equivalents to any Eligible Person entitling the Eligible Person to
receive cash, Shares, other Awards, or other property equal in
value to the dividends paid with respect to a specified number of
Shares, or other periodic payments. Dividend Equivalents may be
awarded on a free-standing basis or in connection with another
Award. The Committee may provide that Dividend Equivalents shall be
paid or distributed when accrued or shall be deemed to have been
reinvested in additional Shares, Awards, or other investment
vehicles, and subject to such restrictions on transferability and
risks of forfeiture, as the Committee may specify. Unless otherwise
determined by the Committee at date of grant, any Dividend
Equivalents that are granted with respect to any Deferred Stock
Award shall be either (A) paid with respect to such Deferred Stock
Award at the dividend payment date in cash or in Shares of
unrestricted stock having a Fair Market Value equal to the amount
of such dividends, or (B) deferred with respect to such Deferred
Stock Award and the amount or value thereof automatically deemed
reinvested in additional Deferred Stock, other Awards or other
investment vehicles, as the Committee shall determine or permit the
Participant to elect.

 

(h)           Performance
Awards. The Committee is authorized to grant Performance
Awards to any Eligible Person payable in cash, Shares, or other
Awards, on terms and conditions established by the Committee. The
performance criteria to be achieved during any Performance Period
and the length of the Performance Period shall be determined by the
Committee upon the grant of each Performance Award. Except as
provided in Section 9 or as may be provided in an Award Agreement,
Performance Awards will be distributed only after the end of the
relevant Performance Period. The performance goals to be achieved
for each Performance Period shall be conclusively determined by the
Committee and may be based on any criteria that the Committee, in
its sole discretion, shall determine should be used for that
purpose. The amount of the Award to be distributed shall be
conclusively determined by the Committee. Performance Awards may be
paid in a lump sum or in installments following the close of the
Performance Period or, in accordance with procedures established by
the Committee, on a deferred basis.

 

(i)           Other
Stock-Based Awards. The Committee is authorized, subject to
limitations under applicable law, to grant to any Eligible Person
such other Awards that may be denominated or payable in, valued in
whole or in part by reference to, or otherwise based on, or related
to, Shares, as deemed by the Committee to be consistent with the
purposes of the Plan. Other Stock-Based Awards may be granted to
Participants either alone or in addition to other Awards granted
under the Plan, and such Other Stock-Based Awards shall also be
available as a form of payment in the settlement of other Awards
granted under the Plan. The Committee shall determine the terms and
conditions of such Awards. Payment pursuant to an Award granted
under this Section 6(i) shall be made at such times, by such
methods and in such forms, including, without limitation, cash,
Shares, other Awards or other property, as the Committee shall
determine.

 

 

15

 

 

7.           Certain
Provisions Applicable to Awards.

 

(a)           Stand-Alone,
Additional, Tandem and Substitute Awards. Awards granted
under the Plan may, in the discretion of the Committee, be granted
either alone or in addition to, in tandem with, or in substitution
or exchange for, any other Award or any award granted under another
plan of the Company, any Related Entity, or any business entity to
be acquired by the Company or a Related Entity, or any other right
of a Participant to receive payment from the Company or any Related
Entity. Such additional, tandem, and substitute or exchange Awards
may be granted at any time. If an Award is granted in substitution
or exchange for another Award or award, the Committee shall require
the surrender of such other Award or award in consideration for the
grant of the new Award. In addition, Awards may be granted in lieu
of cash compensation, including in lieu of cash amounts payable
under other plans of the Company or any Related Entity, in which
the value of Shares subject to the Award is equivalent in value to
the cash compensation, or in which the exercise price, grant price
or purchase price of the Award in the nature of a right that may be
exercised is equal to the Fair Market Value of the underlying
Shares minus the value of the cash compensation surrendered. Awards
granted pursuant to the preceding sentence shall be designed,
awarded and settled in a manner that does not result in additional
taxes under Section 409A of the Code.

 

(b)           Term
of Awards. The term of each Award shall be for such period
as may be determined by the Committee; provided that in no event
shall the term of any Option or Stock Appreciation Right exceed a
period of ten years (or in the case of an Incentive Stock Option
such shorter term as may be required under Section 422 of the
Code).

 

(c)           Form
and Timing of Payment Under Awards; Deferrals. Subject to
the terms of the Plan and any applicable Award Agreement, payments
to be made by the Company or a Related Entity upon the exercise of
an Option or other Award or settlement of an Award may be made in
such forms as the Committee shall determine, including, without
limitation, cash, Shares, other Awards or other property, and may
be made in a single payment or transfer, in installments, or on a
deferred basis. Any installment or deferral provided for in the
preceding sentence shall, however, be subject to the
Company’s compliance with the provisions of Section 409A of
the Code and other applicable law, rules and regulations adopted by
the Securities and Exchange Commission, and all applicable rules of
any national securities exchange on which the Company’s
securities are listed for trading and, if not listed for trading on
a national securities exchange, then the rules of the NASDAQ Stock
Market. The settlement of any Award may be accelerated, and cash
paid in lieu of Shares in connection with such settlement, in the
discretion of the Committee or upon occurrence of one or more
specified events (in addition to a Change in Control), subject to
compliance with the provisions of Section 409A of the Code.
Installment or deferred payments may be required by the Committee
(subject to Section 10(e) of the Plan, including the consent
provisions thereof in the case of any deferral of an outstanding
Award not provided for in the original Award Agreement) or
permitted at the election of the Participant on terms and
conditions established by the Committee. Payments may include,
without limitation, provisions for the payment or crediting of a
reasonable interest rate on installment or deferred payments or the
grant or crediting of Dividend Equivalents or other amounts in
respect of installment or deferred payments denominated in
Shares.

 

(d)           Exemptions
from Section 16(b) Liability. It is the intent of the
Company that the grant of any Awards to or other transaction by a
Participant who is subject to Section 16 of the Exchange Act shall
be exempt from Section 16 pursuant to an applicable exemption
(except for transactions acknowledged in writing to be non-exempt
by such Participant). Accordingly, if any provision of this Plan or
any Award Agreement does not comply with the requirements of Rule
16b-3 then applicable to any such transaction, such provision shall
be construed or deemed amended to the extent necessary to conform
to the applicable requirements of Rule 16b-3 so that such
Participant shall avoid liability under Section 16(b).

 

 

16

 

 

8.           Successors.
All obligations of the Company under the Plan, with respect to
Awards granted hereunder, shall be binding on any successor to the
Company, whether the existence of such successor is the result of a
direct or indirect purchase, merger, consolidation, or otherwise,
of all or substantially all of the business and/or assets of the
Company.

 

9.           Change
in Control.

 

(a)           Effect
of “Change in Control.” Subject to Section
9(a)(iv), and if and only to the extent provided in the Award
Agreement, or to the extent otherwise determined by the Committee,
upon the occurrence of a “Change in Control,” as
defined in Section 9(b):

 

(i)           Any
Option or Stock Appreciation Right that was not previously vested
and exercisable as of the time of the Change in Control, shall
become immediately vested and exercisable, subject to applicable
restrictions set forth in Section 10(a) hereof.

 

(ii)         
Any restrictions, deferral of settlement, and forfeiture conditions
applicable to a Restricted Stock Award, Restricted Stock Unit
Award, Deferred Stock Award or an Other Stock-Based Award subject
only to future service requirements granted under the Plan shall
lapse and such Awards shall be deemed fully vested as of the time
of the Change in Control, except to the extent of any waiver by the
Participant and subject to applicable restrictions set forth in
Section 10(a) hereof.

 

(iii)        
With respect to any outstanding Award subject to achievement of
performance goals and conditions under the Plan, the Committee may,
in its discretion, deem such performance goals and conditions as
having been met as of the date of the Change in
Control.

 

(iv)        
Notwithstanding the foregoing, if in the event of a Change in
Control the successor company assumes or substitutes for an Option,
Stock Appreciation Right, Restricted Stock Award, Restricted Stock
Unit Award, Deferred Stock Award or Other Stock-Based Award, then
each outstanding Option, Stock Appreciation Right, Restricted Stock
Award, Deferred Stock Award or Other Stock-Based Award shall not be
accelerated as described in Sections 9(a)(i), (ii) and (iii). For
the purposes of this Section 9(a)(iv), an Option, Stock
Appreciation Right, Restricted Stock Award, Restricted Stock Unit
Award, Deferred Stock Award or Other Stock-Based Award shall be
considered assumed or substituted for if following the Change in
Control the award confers the right to purchase or receive, for
each Share subject to the Option, Stock Appreciation Right,
Restricted Stock Award, Restricted Stock Unit Award, Deferred Stock
Award or Other Stock-Based Award immediately prior to the Change in
Control, the consideration (whether stock, cash or other securities
or property) received in the transaction constituting a Change in
Control by holders of Shares for each Share held on the effective
date of such transaction (and if holders were offered a choice of
consideration, the type of consideration chosen by the holders of a
majority of the outstanding shares); provided, however, that if such
consideration received in the transaction constituting a Change in
Control is not solely common stock of the successor company or its
parent or subsidiary, the Committee may, with the consent of the
successor company or its parent or subsidiary, provide that the
consideration to be received upon the exercise or vesting of an
Option, Stock Appreciation Right, Restricted Stock Award,
Restricted Stock Unit Award, Deferred Stock Award or Other
Stock-Based Award, for each Share subject thereto, will be solely
common stock of the successor company or its parent or subsidiary
substantially equal in fair market value to the per share
consideration received by holders of Shares in the transaction
constituting a Change in Control. The determination of such
substantial equality of value of consideration shall be made by the
Committee in its sole discretion and its determination shall be
conclusive and binding.

 

 

17

 

 

(b)           Definition
of “Change in Control.” Unless otherwise
specified in an Award Agreement, a “Change in Control”
shall mean the occurrence of any of the following:

 

(i)           The
acquisition by any Person of Beneficial Ownership (within the
meaning of Rule 13d-3 promulgated under the Exchange Act) of more
than fifty percent (50%) of either the then outstanding shares of
common stock of the Company (the “Outstanding Company Common
Stock”) or the combined voting power of the then outstanding
voting securities of the Company entitled to vote generally in the
election of directors (the “Outstanding Company Voting
Securities”) (the foregoing Beneficial Ownership hereinafter
being referred to as a “Controlling Interest”);
provided,
however, that for
purposes of this Section 9(b), the following acquisitions shall not
constitute or result in a Change of Control: (v) any acquisition
directly from the Company; (w) any acquisition by the Company; (x)
any acquisition by any Person that as of the Effective Date owns
Beneficial Ownership of a Controlling Interest; (y) any acquisition
by any employee benefit plan (or related trust) sponsored or
maintained by the Company or any Subsidiary; or (z) any acquisition
by any corporation pursuant to a transaction which complies with
clauses (A), (B) and (C) of subsection (iii) below; or

 

(ii)         
During any period of two (2) consecutive years (not including any
period prior to the Effective Date) individuals who constitute the
Board on the Effective Date (the “Incumbent Board”)
cease for any reason to constitute at least a majority of the
Board; provided,
however, that any
individual becoming a director subsequent to the Effective Date
whose election, or nomination for election by the Company’s
shareholders, was approved by a vote of at least a majority of the
directors then comprising the Incumbent Board shall be considered
as though such individual were a member of the Incumbent Board, but
excluding, for this purpose, any such individual whose initial
assumption of office occurs as a result of an actual or threatened
election contest with respect to the election or removal of
directors or other actual or threatened solicitation of proxies or
consents by or on behalf of a Person other than the Board;
or

 

(iii)        
Consummation of a reorganization, merger, statutory share exchange
or consolidation or similar corporate transaction involving the
Company or any of its Subsidiaries, a sale or other disposition of
all or substantially all of the assets of the Company, or the
acquisition of assets or stock of another entity by the Company or
any of its Subsidiaries (each a “Business
Combination”), in each case, unless, following such Business
Combination, all or substantially all of the individuals and
entities who were the Beneficial Owners, respectively, of the
Outstanding Company Common Stock and Outstanding Company Voting
Securities immediately prior to such Business Combination
beneficially own, directly or indirectly, more than fifty percent
(50%) of the then outstanding shares of common stock and the
combined voting power of the then outstanding voting securities
entitled to vote generally in the election of directors, as the
case may be, of the corporation resulting from such Business
Combination (including, without limitation, a corporation which as
a result of such transaction owns the Company or all or
substantially all of the Company’s assets either directly or
through one or more subsidiaries) in substantially the same
proportions as their ownership, immediately prior to such Business
Combination, of the Outstanding Company Common Stock and
Outstanding Company Voting Securities, as the case may be, no
Person (excluding any employee benefit plan (or related trust) of
the Company or such corporation resulting from such Business
Combination or any Person that as of the Effective Date owns
Beneficial Ownership of a Controlling Interest) beneficially owns,
directly or indirectly, fifty percent (50%) or more of the then
outstanding shares of common stock of the corporation resulting
from such Business Combination or the combined voting power of the
then outstanding voting securities of such corporation except to
the extent that such ownership existed prior to the Business
Combination and at least a majority of the members of the Board of
Directors of the corporation resulting from such Business
Combination were members of the Incumbent Board at the time of the
execution of the initial agreement, or of the action of the Board,
providing for such Business Combination; or

 

 

18

 

 

(iv)           Approval
by the shareholders of the Company of a plan of complete
liquidation or dissolution of the Company or an agreement for the
sale or disposition by the Company of all or substantially all of
the Company’s assets.

 

Notwithstanding the
foregoing, if a Change in Control constitutes a payment event with
respect to any Award (or any portion of an Award) that provides for
the deferral of compensation that is subject to Section 409A of the
Code, to the extent required to avoid the imposition of additional
taxes under Section 409A of the Code, the transaction or event
described in subsection (i) (ii), (iii) or (iv) with respect to
such Award (or portion thereof) shall only constitute a Change in
Control for purposes of the payment timing of such Award if such
transaction also constitutes a “change in control
event,” as defined in Treasury Regulation Section
1.409A-3(i)(5).

 

10.           General
Provisions.

 

(a)           Compliance
With Legal and Other Requirements. The Company may, to the
extent deemed necessary or advisable by the Committee, postpone the
issuance or delivery of Shares or payment of other benefits under
any Award until completion of such registration or qualification of
such Shares or other required action under any federal or state
law, rule or regulation, listing or other required action with
respect to any stock exchange or automated quotation system upon
which the Shares or other Company securities are listed or quoted,
or compliance with any other obligation of the Company, as the
Committee, may consider appropriate, and may require any
Participant to make such representations, furnish such information
and comply with or be subject to such other conditions as it may
consider appropriate in connection with the issuance or delivery of
Shares or payment of other benefits in compliance with applicable
laws, rules, and regulations, listing requirements, or other
obligations.

 

(b)           Limits
on Transferability; Beneficiaries. No Award or other right
or interest granted under the Plan shall be pledged, hypothecated
or otherwise encumbered or subject to any lien, obligation or
liability of such Participant to any party, or assigned or
transferred by such Participant otherwise than by will or the laws
of descent and distribution or to a Beneficiary upon the death of a
Participant, and such Awards or rights that may be exercisable
shall be exercised during the lifetime of the Participant only by
the Participant or his or her guardian or legal representative,
except that Awards and other rights (other than Incentive Stock
Options and Stock Appreciation Rights in tandem therewith) may be
transferred to one or more Beneficiaries or other transferees
during the lifetime of the Participant, and may be exercised by
such transferees in accordance with the terms of such Award, but
only if and to the extent such transfers are permitted by the
Committee pursuant to the express terms of an Award Agreement
(subject to any terms and conditions which the Committee may impose
thereon). A Beneficiary, transferee, or other person claiming any
rights under the Plan from or through any Participant shall be
subject to all terms and conditions of the Plan and any Award
Agreement applicable to such Participant, except as otherwise
determined by the Committee, and to any additional terms and
conditions deemed necessary or appropriate by the
Committee.

 

(c)           Adjustments.

 

(i)           Adjustments
to Awards. In the event that any extraordinary dividend or
other distribution (whether in the form of cash, Shares, or other
property), recapitalization, forward or reverse split,
reorganization, merger, consolidation, spin-off, combination,
repurchase, share exchange, liquidation, dissolution or other
similar corporate transaction or event affects the Shares and/or
such other securities of the Company or any other issuer such that
a substitution, exchange, or adjustment is determined by the
Committee to be appropriate, then the Committee shall, in such
manner as it may deem equitable, substitute, exchange or adjust any
or all of (A) the number and kind of Shares which may be
delivered in connection with Awards granted thereafter, (B) the
number and kind of Shares subject to or deliverable in respect of
outstanding Awards, (C) the exercise price, grant price or
purchase price relating to any Award and/or make provision for
payment of cash or other property in respect of any outstanding
Award, and (D) any other aspect of any Award that the Committee
determines to be appropriate.

 

 

19

 

 

(ii)           Adjustments
in Case of Certain Corporate Transactions. In the event of
any merger, consolidation or other reorganization in which the
Company does not survive, or in the event of any Change in Control,
any outstanding Awards may be dealt with in accordance with any of
the following approaches, as determined by the agreement
effectuating the transaction or, if and to the extent not so
determined, as determined by the Committee: (a) the continuation of
the outstanding Awards by the Company, if the Company is a
surviving corporation, (b) the assumption or substitution for, as
those terms are defined in Section 9(b)(iv) hereof, the outstanding
Awards by the surviving corporation or its parent or subsidiary,
(c) full exercisability or vesting and accelerated expiration of
the outstanding Awards, or (d) settlement of the value of the
outstanding Awards in cash or cash equivalents or other property
followed by cancellation of such Awards (which value, in the case
of Options or Stock Appreciation Rights, shall be measured by the
amount, if any, by which the Fair Market Value of a Share exceeds
the exercise or grant price of the Option or Stock Appreciation
Right as of the effective date of the transaction). The Committee
shall give written notice of any proposed transaction referred to
in this Section 10(c)(ii) a reasonable period of time prior to the
closing date for such transaction (which notice may be given either
before or after the approval of such transaction), in order that
Participants may have a reasonable period of time prior to the
closing date of such transaction within which to exercise any
Awards that are then exercisable (including any Awards that may
become exercisable upon the closing date of such transaction). A
Participant may condition his exercise of any Awards upon the
consummation of the transaction.

 

(iii)         
Other Adjustments. The
Committee is authorized to make adjustments in the terms and
conditions of, and the criteria included in, Awards (including
Performance Awards, or performance goals relating thereto) in
recognition of unusual or nonrecurring events (including, without
limitation, acquisitions and dispositions of businesses and assets)
affecting the Company, any Related Entity or any business unit, or
the financial statements of the Company or any Related Entity, or
in response to changes in applicable laws, regulations, accounting
principles, tax rates and regulations or business conditions or in
view of the Committee’s assessment of the business strategy
of the Company, any Related Entity or business unit thereof,
performance of comparable organizations, economic and business
conditions, personal performance of a Participant, and any other
circumstances deemed relevant.

 

(d)         
Taxes. The Company and any
Related Entity are authorized to withhold from any Award granted
any payment relating to an Award under the Plan, including from a
distribution of Shares, or any payroll or other payment to a
Participant, amounts of withholding and other taxes due or
potentially payable in connection with any transaction involving an
Award, and to take such other action as the Committee may deem
advisable to enable the Company or any Related Entity and
Participants to satisfy obligations for the payment of withholding
taxes and other tax obligations relating to any Award. This
authority shall include authority to withhold or receive Shares or
other property and to make cash payments in respect thereof in
satisfaction of a Participant’s tax obligations, either on a
mandatory or elective basis in the discretion of the Committee. The
withholding of taxes is intended to comply with the requirements of
Rule 10b5-1(c)(1)(i)(B) of the Exchange Act to the extent permitted
by law.

 

(e)           Changes
to the Plan and Awards. The Board may amend, alter, suspend,
discontinue or terminate the Plan, or the Committee’s
authority to grant Awards under the Plan, without the consent of
shareholders or Participants, except that any amendment or
alteration to the Plan shall be subject to the approval of the
Company’s shareholders not later than the annual meeting next
following such Board action if such shareholder approval is
required by any federal or state law or regulation (including,
without limitation, Rule 16b-3 or Section 422 of the Code) or the
rules of any stock exchange or automated quotation system on which
the Shares may then be listed or quoted), and the Board may
otherwise, in its discretion, determine to submit other such
changes to the Plan to shareholders for approval; provided that,
without the consent of an affected Participant, no such Board
action may materially and adversely affect the rights of such
Participant under any previously granted and outstanding Award. The
Committee may waive any conditions or rights under, or amend,
alter, suspend, discontinue or terminate any Award theretofore
granted and any Award Agreement relating thereto, except as
otherwise provided in the Plan; provided that, without the consent
of an affected Participant, no such Committee or the Board action
may materially and adversely affect the rights of such Participant
under such Award.

 

 

20

 

 

(f)           Limitation
on Rights Conferred Under Plan. Neither the Plan nor any
action taken hereunder shall be construed as (i) giving any
Eligible Person or Participant the right to continue as an Eligible
Person or Participant or in the employ or service of the Company or
a Related Entity; (ii) interfering in any way with the right
of the Company or a Related Entity to terminate any Eligible
Person’s or Participant’s Continuous Service at any
time, (iii) giving an Eligible Person or Participant any claim
to be granted any Award under the Plan or to be treated uniformly
with other Participants and Employees, or (iv) conferring on a
Participant any of the rights of a shareholder of the Company
unless and until the Participant is duly issued or transferred
Shares in accordance with the terms of an Award.

 

(g)           Unfunded
Status of Awards; Creation of Trusts. The Plan is intended
to constitute an “unfunded” plan for incentive and
deferred compensation. With respect to any payments not yet made to
a Participant or obligation to deliver Shares pursuant to an Award,
nothing contained in the Plan or any Award shall give any such
Participant any rights that are greater than those of a general
creditor of the Company; provided that the Committee may authorize
the creation of trusts and deposit therein cash, Shares, other
Awards or other property, or make other arrangements to meet the
Company’s obligations under the Plan. Such trusts or other
arrangements shall be consistent with the “unfunded”
status of the Plan unless the Committee otherwise determines with
the consent of each affected Participant. The trustee of such
trusts may be authorized to dispose of trust assets and reinvest
the proceeds in alternative investments, subject to such terms and
conditions as the Committee may specify and in accordance with
applicable law.

 

(h)           Code
Section 409A. It is intended that all Awards issued under
the Plan be in a form and administered in a manner that will comply
with the requirements of Section 409A of the Code, or the
requirements of an exception to Section 409A of the Code, and the
Award Agreement and this Plan will be construed and administered in
a manner that is consistent with and gives effect to such intent.
The Committee is authorized to adopt rules or regulations deemed
necessary or appropriate to qualify for an exception from or to
comply with the requirements of Section 409A of the Code. With
respect to an Award that constitutes a deferral of compensation
subject to Section 409A of the Code: (i) if any amount is payable
under such Award upon a termination of service, a termination of
service will be treated as having occurred only at such time the
Participant has experienced a “separation from service”
as such term is defined for purposes of Section 409A of the Code;
(ii) if any amount is payable under such Award upon a disability, a
disability will be treated as having occurred only at such time the
Participant has experienced a “disability” as such term
is defined for purposes of Section 409A of the Code; (iii) if any
amount is payable under such Award on account of the occurrence of
a Change in Control, a Change in Control will be treated as having
occurred only at such time a “change in the ownership or
effective control of the corporation or in the ownership of a
substantial portion of the assets of the corporation” has
occurred as such terms are defined for purposes of Section 409A of
the Code, (iv) if any amount becomes payable under such Award on
account of a Participant’s separation from service at such
time as the Participant is a “specified employee”
within the meaning of Section 409A of the Code, then no payment
shall be made, except as permitted under Section 409A of the Code,
prior to the first business day after the earlier of (y) the date
that is six months after the date of the Participant’s
separation from service or (z) the Participant’s death, (v)
any right to receive any installment payments under this Plan shall
be treated as a right to receive a series of separate payments and,
accordingly, each installment payment hereunder shall at all times
be considered a separate and distinct payment, and (vi) no
amendment to or payment under such Award will be made except and
only to the extent permitted under Section 409A of the
Code.

 

Notwithstanding the
foregoing, the tax treatment of the benefits provided under the
Plan or any Award Agreement is not warranted or guaranteed, and in
no event shall the Company be liable for all or any portion of any
taxes, penalties, interest or other expenses that may be incurred
by the Participant on account of non-compliance with Section 409A
of the Code.

 

 

21

 

 

(i)           Nonexclusivity
of the Plan. Neither the adoption of the Plan by the Board
nor its submission to the shareholders of the Company for approval
shall be construed as creating any limitations on the power of the
Board or a committee thereof to adopt such other incentive
arrangements as it may deem desirable including incentive
arrangements and awards which do not qualify under Section 162(m)
of the Code.

 

(j)           Payments
in the Event of Forfeitures; Fractional Shares. Unless
otherwise determined by the Committee, in the event of a forfeiture
of an Award with respect to which a Participant paid cash or other
consideration, the Participant shall be repaid the amount of such
cash or other consideration. No fractional Shares shall be issued
or delivered pursuant to the Plan or any Award. The Committee shall
determine whether cash, other Awards or other property shall be
issued or paid in lieu of such fractional shares or whether such
fractional shares or any rights thereto shall be forfeited or
otherwise eliminated.

 

(k)         
Investment Representations.
The Company shall be under no obligation to issue any Shares
covered by any Award unless the Shares to be issued pursuant to
Awards granted under the Plan have been effectively registered
under the Securities Act of 1933, as amended, or the Participant
shall have made such written representations to the Company (upon
which the Company believes it may reasonably rely) as the Company
may deem necessary or appropriate for purposes of confirming that
the issuance of such Shares will be exempt from the registration
requirements of that Act and any applicable state securities laws
and otherwise in compliance with all applicable laws, rules and
regulations, including but not limited to that the Participant is
acquiring the Shares for his or her own account for the purpose of
investment and not with a view to, or for sale in connection with,
the distribution of any such Shares.

 

(l)           Registration.
If the Company shall deem it necessary or desirable to register
under the Securities Act of 1933, as amended, or other applicable
statutes any Shares issued or to be issued pursuant to Awards
granted under the Plan, or to qualify any such Shares for exemption
from the Securities Act of 1933, as amended, or other applicable
statutes, then the Company shall take such action at its own
expense. The Company may require from each recipient of an Award,
or each holder of Shares acquired pursuant to the Plan, such
information in writing for use in any registration statement,
prospectus, preliminary prospectus or offering circular as is
reasonably necessary for that purpose and may require reasonable
indemnity to the Company and its officers and directors from that
holder against all losses, claims, damage and liabilities arising
from use of the information so furnished and caused by any untrue
statement of any material fact therein or caused by the omission to
state a material fact required to be stated therein or necessary to
make the statements therein not misleading in the light of the
circumstances under which they were made. In addition, the Company
may require of any such person that he or she agree that, without
the prior written consent of the Company or the managing
underwriter in any public offering of Shares, he or she will not
sell, make any short sale of, loan, grant any option for the
purchase of, pledge or otherwise encumber, or otherwise dispose of,
any Shares during the 180 day period commencing on the effective
date of the registration statement relating to the underwritten
public offering of securities. Without limiting the generality of
the foregoing provisions of this Section 10(l), if in connection
with any underwritten public offering of securities of the Company
the managing underwriter of such offering requires that the
Company’s directors and officers enter into a lock-up
agreement containing provisions that are more restrictive than the
provisions set forth in the preceding sentence, then (a) each
holder of Shares acquired pursuant to the Plan (regardless of
whether such person has complied or complies with the provisions of
clause (b) below) shall be bound by, and shall be deemed to have
agreed to, the same lock-up terms as those to which the
Company’s directors and officers are required to adhere; and
(b) at the request of the Company or such managing underwriter,
each such person shall execute and deliver a lock-up agreement in
form and substance equivalent to that which is required to be
executed by the Company’s directors and
officers.

 

 

22

 

 

(m)         
Placement of Legends; Stop Orders;
etc. Each Share to be issued pursuant to Awards granted
under the Plan may bear a reference to the investment
representation made in accordance with Section 10(k) in addition to
any other applicable restriction under the Plan, the terms of the
Award and to the fact that no registration statement has been filed
with the Securities and Exchange Commission in respect to such
Share. All Shares or other securities delivered under the Plan
shall be subject to such stock transfer orders and other
restrictions as the Committee may deem advisable under the rules,
regulations, and other requirements of any stock exchange upon
which the Share is then listed, and any applicable federal or state
securities law, and the Committee may cause a legend or legends to
be put on any certificates or recorded in connection with
book-entry accounts representing the shares to make appropriate
reference to such restrictions.

 

(n)           Uncertificated
Shares. To the extent that the Plan provides for issuance of
certificates to reflect the transfer of Shares, the transfer of
such Shares may be effected on a noncertificated basis, to the
extent not prohibited by applicable law.

 

(o)          
Governing Law. The
validity, construction and effect of the Plan, any rules and
regulations under the Plan, and any Award Agreement shall be
determined in accordance with the laws of the State of Delaware
without giving effect to principles of conflict of laws, and
applicable federal law.

 

(p)           Elections
and Notices. Notwithstanding anything to the contrary
contained in this Plan, all elections and notices of every kind
shall be made on forms prepared by the Company or the General
Counsel, Secretary or Assistant Secretary, or their respective
delegates or shall be made in such other manner as permitted or
required by the Company or the General Counsel, Secretary or
Assistant Secretary, or their respective delegates, including but
not limited to elections or notices through electronic means, over
the Internet or otherwise. An election shall be deemed made when
received by the Company (or its designated agent, but only in cases
where the designated agent has been appointed for the purpose of
receiving such election), which may waive any defects in form. The
Company may limit the time an election may be made in advance of
any deadline.

 

Where
any notice or filing required or permitted to be given to the
Company under the Plan, it shall be delivered to the principal
office of the Company, directed to the attention of the General
Counsel of the Company or his or her successor. Such notice shall
be deemed given on the date of delivery.

 

Notice
to the Participant shall be deemed given when mailed (or sent by
telecopy) to the Participant’s work or home address as shown
on the records of the Company or, at the option of the Company, to
the Participant’s e-mail address as shown on the records of
the Company.

 

 

23

 

 

It is
the Participant’s responsibility to ensure that the
Participant’s addresses are kept up to date on the records of
the Company. In the case of notices affecting multiple
Participants, the notices may be given by general distribution at
the Participants’ work locations.

 

(q)         
Non-U.S. Laws. The
Committee shall have the authority to adopt such modifications,
procedures, and subplans as may be necessary or desirable to comply
with provisions of the laws of foreign countries in which the
Company or its Subsidiaries may operate to assure the viability of
the benefits from Awards granted to Participants performing
services in such countries and to meet the objectives of the
Plan.

 

(r)           Venue.
The Company and the Participant to whom an award under this Plan is
granted, for themselves and their successors and assigns,
irrevocably submit to the exclusive and sole jurisdiction and venue
of the state or federal courts of Delaware with respect to any and
all disputes arising out of or relating to this Plan, the subject
matter of this Plan or any awards under this Plan, including but
not limited to any disputes arising out of or relating to the
interpretation and enforceability of any awards or the terms and
conditions of this Plan. To achieve certainty regarding the
appropriate forum in which to prosecute and defend actions arising
out of or relating to this Plan, and to ensure consistency in
application and interpretation of the Governing Law to the Plan,
the parties agree that (a) sole and exclusive appropriate venue for
any such action shall be an appropriate federal or state court in
Delaware, and no other, (b) all claims with respect to any such
action shall be heard and determined exclusively in such Delaware
court, and no other, (c) such Delaware court shall have sole and
exclusive jurisdiction over the person of such parties and over the
subject matter of any dispute relating hereto and (d) that the
parties waive any and all objections and defenses to bringing any
such action before such Delaware court, including but not limited
to those relating to lack of personal jurisdiction, improper venue
or forum non conveniens.

 

(s)           Plan
Effective Date and Shareholder Approval; Termination of
Plan. The Plan shall become effective on September 25, 2018
(“Effective Date”), subject to subsequent approval,
within 12 months of its adoption by the Board, by shareholders of
the Company eligible to vote in the election of directors, by a
vote sufficient to meet the requirements of Section 422 of the
Code, Rule 16b-3 under the Exchange Act (if applicable), applicable
requirements under the rules of any stock exchange or automated
quotation system on which the Shares may be listed or quoted, and
other laws, regulations, and obligations of the Company applicable
to the Plan. Awards may be granted subject to shareholder approval,
but may not be exercised or otherwise settled in the event the
shareholder approval is not obtained. The Plan shall terminate at
the earliest of (a) such time as no Shares remain available for
issuance under the Plan, (b) termination of this Plan by the Board,
or (c) the tenth anniversary of the Effective Date. Awards
outstanding upon expiration of the Plan shall remain in effect
until they have been exercised or terminated, or have
expired.

 

Adopted
September 2018

 

 

 

24Blueprint

 

Exhibit 10.2

 

 

OFFICE LEASE (FULL-SERVICE GROSS)

 

BETWEEN

HAMPDEN
SQUARE CORPORATION,

a
Delaware corporation,

AS
LANDLORD,

AND

SeD
HOME, INC.,

a
Delaware corporation,

AS
TENANT,

FOR

HAMPDEN
SQUARE

 

 

 

 

SUMMARY OF BASIC LEASE INFORMATION

 

This
Summary of Basic Lease Information (the "Lease Summary") is hereby
incorporated into and made a part of the attached Office Lease
(Full-Service Gross) (this Lease Summary and the Office Lease
(Full-Service Gross) to be known collectively as the "Lease"). In
the event of a conflict between the terms of this Lease Summary and
the Office Lease (Full-Service Gross), the terms of the Office
Lease (Full-Service Gross) shall prevail. Any capitalized terms
used herein and not otherwise defined herein shall have the meaning
as set forth in the Office Lease (Full-Service Gross).

 

	

1.
Date:

	

July
21, 2015.

	

 
 

	

 

	

2.
Landlord:

	

HAMPDEN
SQUARE CORPORATION, a Delaware corporation.

	

 
 

	

 

	

3.
Address of
Landlord:

	

American
Realty Advisors

801
North Brand Blvd., Suite 800

Glendale,
California 91203

Attention:
Stanley Iezman

Phone:
(818) 545-1152

Telecopy:
(818) 545-8460

	

 
 

	

 

	

4.
Tenant:

	

SeD
HOME, INC., a Delaware corporation

	

 
 

	

 

	

5.
Address of
Tenant:

	

4800
Montgomery Lane, Suite 450

Bethesda,
Maryland 20814

Attention:
Mohamed Osman

Phone:
(860) 970-1272

 

(Prior
to Commencement Date)

	

 
 

	
 

	
 

	

and

4800
Montgomery Lane, Suite 210

Bethesda,
Maryland 20814

Attention:
Mohamed Osman

Phone:
(860) 970-1272

 (After
Commencement Date)

	

 
 

	

 

	

6.
Guarantor(s):

	

None.

	

 
 

	

 

	

7.
Premises:

	

Suite
No. 210, which the parties agree contains 2,059 rentable square
feet, on the second (2nd) floor of the
Building. The Premises are outlined on the plan attached to the
Lease as Exhibit A.

	

 
 

	

 

	

8.
Building:

	

The
building of which the Premises are a part is located at 4800
Montgomery Lane, Bethesda, Maryland 20814, as shown on Exhibit B
(the "Building") and is located on the real property described on
Exhibit C (the "Property"). The Building is known as "Hampden
Square." The parties agree that the Building contains 143,885
rentable square feet as of the date hereof.

	

 
 

	

 

	

9
Term:

	
 

	

 
 

	
 

	

(a) Lease
Term:

	

Sixty-five
(65) complete calendar months.

 

 

1

 

 

	

(b) Commencement
Date:

 

	

The
earlier of (a) the date on which Tenant occupies any portion of the
Premises and begins conducting business therein; or (b) August 1,
2015.

	
 

	

 
 
   
 

	

(c)
Expiration Date:

 

	

The
date immediately preceding the sixty-fifth (65th) monthly
anniversary of the Commencement Date, unless the Commencement Date
is not the first day of the month, in which case the Expiration
Date shall be the last day of the month in which the sixty-fifth
(65th)
monthly anniversary of the Commencement Date occurs.

	
 

	

 
   
 

	

10.
Base Rent:

	
 

 

	

Months
of Term

	
 

	

Annual
Base Rent

	
 

	

Monthly
Installmentof Base Rent

	

1-12*

	
 

	

$85,963.20**

	
 

	

$7,163.60**

	

13-24

	
 

	

$88,331.16

	
 

	

$7,360.93

	

25-36

	
 

	

$90,760.68

	
 

	

$7,563.39

	

37-48

	
 

	

$93,252.12

	
 

	

$7,771.01

	

49-60

	
 

	

$95,825.88

	
 

	

$7,985.49

	

61-65

	
 

	

$98,461.44

	
 

	

$8,205.12

 

*

Plus
any partial month if the Commencement Date is not the first day of
the month.

 

**

Provided that
Tenant has faithfully performed all of the terms and conditions of
this Lease, Landlord agrees to abate the obligation of the Tenant
named in this Lease Summary (“Named Tenant”) to pay
Base Rent for the first five (5) complete calendar months of the
initial Term (the “Conditional Rent”). Notwithstanding
the foregoing, however, during such abatement period, Tenant shall
still be responsible for the payment of all Additional Rent payable
under this Lease. In the event of a Default at any time during the
Term, in addition to any other remedies to which Landlord may be
entitled, Landlord shall be entitled to recover the Conditional
Rent (i.e., the amount of the Conditional Rent shall not be deemed
to have been abated, but shall become immediately due and payable
as unpaid Rent earned, but due at the time of such Default). The
right to the abatement set forth above shall be personal to Named
Tenant and shall not be transferable to any assignee, sub-lessee or
other transferee of Named Tenant’s interest in this
Lease.

 

 

Notwithstanding the
foregoing, in lieu of the abatement set forth above, Landlord shall
have the right, upon written notice to Tenant given at any time
prior to the first (1st) day of the fifth
(5th)
complete calendar month of the initial Term, to pay to Tenant an
amount equal to the remaining Conditional Rent to which Tenant
would otherwise be entitled, in which case Tenant shall commence
the payment of Base Rent on the first (1st) day of the first
(1st)
complete calendar month following the date of such
notice.

 

	

11.
Additional
Rent:

	
 

	

 

	

 

	

(a)
Base Year:

	

Calendar
year 2015.

	

 

	

 

	

(b) Tenant’s
Proportionate Share of Project Operating Costs:

	

1.43%.

	

 
 

	
 

 

 

2

 

 

	

12.
Construction:

	
 

	

 
 

	
 

	

(a)
Allowance:

	

None.

	

 
 

	
 

	

13.
Initial
Payments:

	
 

	

 
 

	
 

	

(a)
Security Deposit:

	

$21,490.80.

	

 

	

 

	

(b)
Prepaid Rent:

	

$7,163.60.

	

 

	

 

	

14.
Permitted Use:

	

General
office use consistent with the character of a Class “A”
office building.

	

 
 

	
 

	

15.
Parking:

 

	

Non-reserved
Parking Spaces: Five (5), based upon 2.5 non-reserved parking
spaces per 1,000 rentable square feet of the Premises.

 

Initial
Monthly Parking Rate: $125.00 per non-reserved space.

	

 
 

	
 

	

16.
Brokers:

	
 

	

 

	
 

	

(a)
Tenant’s Broker:

 

	

Master
of Real Estate, LLC

4800
Montgomery Lane, Suite 450Bethesda, MD 20814

Attention:
Anne Butler

	
 

	
 

	
 

	
 

	

(b)
Landlord’s Broker:

 

	

Transwestern

6700
Rockledge Drive, Suite 500ABethesda, MD 20817

Attention:
Phil McCarthy

	
 

	
 

	

17.            Exhibits:

	

The
exhibits listed below are incorporated by reference in this
Lease.

	

 
 

	

 

	
 

	

Exhibit
A        Floor Plan of
Premises

Exhibit
B        Site Plan of
Building

Exhibit
C        Legal
Description

Exhibit
D        Term
Certification

Exhibit
E        Intentionally
Omitted

Exhibit
E-1    Tenant Improvement Work

Exhibit
E-2    Construction Rules and
Regulations

Exhibit
F        Building
Services

Exhibit
G        Rules and
Regulations

Exhibit
H        Parking
Agreement

 

 

3

 

 

Landlord and Tenant
hereby agree to the foregoing terms of this Lease
Summary.

 

	

LANDLORD:

	

HAMPDEN
SQUARE CORPORATION,

a
Delaware corporation

	

 

	

 

	
 

	

By:
/s/ Michael
Gelber

Printed
Name: Michael
Gelber

Title:
Senior Asset
Manager

Date:
July 29,
2015

	
 

	
 

	

TENANT:

	

SeD
HOME, INC.,

a
Delaware corporation

	

 

	
 

	
 

	

By:
/s/ Jeffrey
Busch

Printed
Name: Jeffrey M.
Busch

Title:
President

Date:
July 24,
2015

Taxpayer
ID No.: W13936588

 

 

4

 

 

OFFICE LEASE (FULL-SERVICE GROSS)

 

THIS
OFFICE LEASE (FULL-SERVICE GROSS) (the “Lease”) is made
effective as of July 21, 2015, by and between HAMPDEN SQUARE
CORPORATION, a Delaware corporation (“Landlord”), and
SeD HOME, INC., a Delaware corporation (“Tenant”), with
reference to the following facts and circumstances:

 

A.           Landlord
is the owner of the Project, as defined herein.

 

B.           The
Premises covered by this Lease are defined on the Lease Summary and
are located in the Building, as defined on the Lease
Summary.

 

C.           American
Realty Advisors (and its affiliates; collectively,
“Advisor”) is the real estate investment manager for
Landlord.

 

D.           The
parties desire to enter into this Lease, all on the terms and
conditions set forth herein.

 

NOW,
THEREFORE, in consideration of the foregoing facts and
circumstances, the mutual covenants and promises contained herein
and other good and valuable consideration, the receipt and
sufficiency of which are acknowledged by each of the parties, the
parties do hereby agree to the following:

 

ARTICLE 1

LEASE OF
PREMISES

 

In
consideration of the Rent and the provisions of this Lease,
Landlord leases to Tenant and Tenant leases from Landlord the
Premises. In addition, Tenant shall have the non-exclusive right
(unless otherwise provided herein) in common with Landlord, other
tenants, subtenants, and invitees to use the Common
Areas.

 

ARTICLE 2

DEFINITIONS

 

Except
as otherwise defined in this Lease, capitalized terms shall have
the meanings set forth on the Lease Summary. As used in this Lease,
the following terms shall have the following
definitions:

 

2.1. Additional
Rent . All amounts,
costs and expenses that Tenant assumes, agrees or is otherwise
obligated to pay to Landlord under this Lease other than Base
Rent.

 

2.2. Affiliate
. An
entity that is controlled by, controls, or is under common control
with a party. “Control” shall mean the ownership,
directly or indirectly, of at least fifty-one percent (51%) of the
voting securities of, or possession of the right to vote, in the
ordinary direction of its affairs, of at least fifty-one percent
(51%) of the voting interest in any entity.

 

2.3. Bankruptcy
Code . Title 11 of the
United States Code, as amended from time to time.

 

2.4. Base
Rent . As set forth on
the Lease Summary.

 

2.5. Base
Year . As set forth on
the Lease Summary.

 

 

5

 

 

 

 

2.6. Building
Services . As set forth in
Exhibit
F.

 

2.7. Building
Systems . Any plant,
machinery, transformers, duct work, cable, wires, and other
equipment and facilities, and any systems designed to supply heat,
ventilation, air conditioning and humidity or any other services or
utilities, or comprising or serving as any component or portion of
the electrical, gas, steam, plumbing, sprinkler, communications,
alarm, security, or fire/life safety systems or equipment, any
Telecommunications System serving the Building and any other
mechanical, electrical, electronic, computer or other systems or
equipment that serves the Building in whole or in
part.

 

2.8. Business
Days . Days other than
Saturdays, Sundays and Holidays. If any item must be accomplished
or delivered hereunder on a day that is not a Business Day, it
shall be timely to accomplish or deliver the same on the next
following Business Day.

 

2.9. Business
Hours . As set forth in
Exhibit
F.

 

2.10. Claims
.
Actions, causes of action, charges, claims, contribution costs,
damages, demands, expenses (including, without limitation,
attorneys’ fees and fees and costs of consultants and other
professionals), fines, liabilities, liens, losses, obligations,
penalties, proceedings, response costs, or suits. All references in
this Lease to Landlord’s “attorneys’ fees”
shall mean and refer to all of Landlord’s fees and costs for
attorneys, including in-house attorneys.

 

2.11. Commencement
Date . As set forth on
the Lease Summary.

 

2.12. Common
Areas . The building
lobbies, common corridors, common restrooms (as opposed to
restrooms for the exclusive use of any tenant), passageways,
elevators, stairways, unrestricted parking areas, entrances, exits,
driveways and walkways, loading facilities, freight elevators,
terraces and landscaped areas in and around the Building, and other
public or common areas in the Project designated as such by
Landlord.

 

2.13. Environmental
Laws . All Laws
regulating or controlling Hazardous Materials, including, without
limitation, the Comprehensive Environmental Response, Compensation,
and Liability Act of 1980, as amended, 42 U.S.C. 9601, et seq.; the Hazardous Material
Transportation Act, 49 U.S.C. 1801 et seq.; and the Resource
Conservation and Recovery Act, 42 U.S.C. 6901 et seq.

 

2.14. Expiration
Date . As set forth on
the Lease Summary, unless otherwise sooner terminated in accordance
with the provisions of this Lease.

 

 

 

6

 

 

2.15. Force
Majeure . Strikes, labor
disputes, lockouts, inability to obtain labor, materials,
equipment, or reasonable substitutes therefor, acts of God,
governmental restrictions, regulations, or controls, judicial
orders, enemy or hostile government actions, civil commotion, war,
terrorism (foreign or domestic), fire, accident, explosion, falling
objects or other casualty, or other causes beyond the reasonable
control of the party obligated to perform hereunder.

 

2.16. Guarantor(s)
. The
parties set forth on the Lease Summary and any other party liable
for or required by Landlord to guaranty Tenant’s obligations
under the Lease.

 

2.17. Hazardous
Materials . Any hazardous
waste or hazardous substance as defined in any Laws applicable to
the Project, including, without limitation, the Environmental Laws.
“Hazardous Materials” shall also include asbestos or
asbestos-containing materials, radon gas, petroleum or petroleum
fractions, urea formaldehyde foam insulation, transformers
containing levels of polychlorinated biphenyls greater than 50
parts per million, medical waste, biological materials (including
without limitation blood and blood products), electromagnetic
fields, mold and chemicals known to cause cancer or reproductive
toxicity, whether or not defined as a hazardous waste or hazardous
substance in any statute, ordinance, rule or
regulation.

 

2.18. Holidays
. All
federally observed holidays, including New Year’s Day, Martin
Luther King, Jr. Day, President’s Day, Memorial Day,
Independence Day, Labor Day, Veteran’s Day, Thanksgiving Day
and Christmas Day.

 

2.19. Insurance
. All
costs incurred by Landlord for insurance with respect to the
Project, including but not limited to the insurance required under
Section 18.1 below.

 

2.20. Interest
Rate . The average prime
loan rate published by the board of governors of the Federal
Reserve System of the United States, as the same may change from
time to time, plus four percent (4%) per annum, but not in excess
of the maximum rate, if any, allowed by Law for the transaction on
which interest is being calculated.

 

2.21. Landlord
Related Parties . Landlord,
Landlord’s Affiliates, and the members, principals,
beneficiaries, partners, trustees, shareholders, directors,
officers, employees, mortgagees, investment managers, property
managers, brokers, contractors, attorneys, and agents of Landlord
and Landlord’s Affiliates, and the successors of such
parties.

 

2.22. Law
or Laws . All federal,
state, county and local governmental and municipal laws, statutes,
ordinances, rules, regulations, requirements, codes, decrees,
orders, and decisions by courts and cases, when the decisions are
considered binding precedent in the State, and decisions of federal
courts applying the Law of the State; including but not limited to
The Americans With Disabilities Act of 1990 (42 U.S.C. § 12101
et seq.), and any regulations and guidelines promulgated
thereunder, as all of the same may be amended and supplemented from
time to time.

 

 

7

 

 

 

 

2.23. Lease
Year . Each twelve (12)
month period or portion thereof during the Term, commencing with
the Commencement Date, without regard to calendar years; provided,
however, if the Commencement Date is not the first day of the
month, then the first (1st) Lease Year shall
commence on the first day of the first calendar month after the
Commencement Date and be deemed to include the partial month at the
beginning of the Term.

 

2.24. Mortgagee
. The
lessor under any present and future ground or underlying lease of
the Property and the holder of any mortgage, deed to secure debt or
trust deed now or hereafter in force against the Property or the
Building.

 

2.25. Operating
Costs . All costs
incurred by Landlord or its agents in the ownership, management,
maintenance, repair, replacement, improvement, alteration and
operation of the Building and Project, which may include, without
limitation, any or all of the following: (a) utilities; (b)
supplies, tools, equipment and materials used in the operation,
repair and maintenance of the Building or the Project; (c)
landscaping; (d) parking area repair, restoration, and maintenance,
including, but not limited to, resurfacing, repainting,
re-striping, and cleaning; (e) reasonable reserves for operation,
maintenance and repair of the Project and for covering uninsured
damage and liability claims relating to the Project, including,
without limitation, deductible amounts (provided that if Landlord
incurs an expense for which a reserve is held, Landlord shall apply
the applicable reserves to the expense prior to including the
balance of the expense in Operating Costs); (f) fees, charges and
other costs, including, without limitation, reasonable consulting
fees, legal fees and accounting fees, of all contractors engaged by
Landlord or otherwise reasonably incurred by Landlord in connection
with the management, operation, maintenance and repair of the
Building or the Project; (g) compensation (including, without
limitation, employment taxes and fringe benefits) of all persons
who perform duties in connection with the operation, maintenance,
repair, or overhaul of the Building or the Project, and equipment,
improvements, and facilities located within the Project; (h)
operation and maintenance of a room for delivery and distribution
of mail to tenants of the Building or the Project as required by
the U. S. Postal Service, along with any space Landlord provides
for non-exclusive use by tenants, such as conference centers,
exercise facilities and other building amenities (including,
without limitation, an amount equal to the fair market rental value
of the space used for such purposes); (i) payments under any
easement, license, operating agreement, declaration, restrictive
covenant, underlying or ground lease (excluding rent), or
instrument pertaining to the sharing of costs by the Building or
the Project; (j) operation, repair, maintenance and replacement of
the Building’s structure and all Building Systems, including,
without limitation, the cost to replace or retrofit as required by
Laws; (k) janitorial service, alarm and security service, window
cleaning, trash removal; (l) repair and replacement of building
standard surfaces, including but not limited to wall and floor
coverings, ceiling tiles, window coverings and fixtures; (m)
maintenance and replacement of curbs and walkways; (n) repair to
and replacement of the roof; (o) Building signage and directories;
(p) management of the Building or the Project, whether by Landlord
or an independent contractor (including, without limitation, an
amount equal to the fair market value of any manager’s
office; provided, that if such manager’s office is located
off-site, the fair market value of such office shall be equitably
allocated among all buildings managed by such office); (q) rental
expenses for (or a reasonable depreciation allowance on) personal
property used in maintenance, operation or repair of the Building
or the Project; (r) licenses, certificates, permits and inspections
and the cost of contesting the validity or applicability of any
governmental enactments that may affect Operating Costs; (s) the
cost of monitoring, investigating, testing and remediation of
Hazardous Materials; (t) the costs incurred in connection with the
implementation and operation of any transportation system
management program or similar program; (u) any costs, expenditures,
or charges (whether capitalized or not) required by any
governmental or quasi-governmental authority; and (v) amortization
of capital expenses (including, without limitation, financing
costs) (A) that are intended as a labor saving device or to effect
other economies in the operation or maintenance of the Building or
the Project, or any portion thereof, (B) that are required under
any Law, or (C) that are in Landlord’s opinion necessary to
maintain the Building or the Project, or any portion thereof, in
good condition and repair; provided that any such cost shall be
amortized (including interest on the unamortized cost) over its
useful life or any other appropriate amortization period, as
Landlord shall reasonably determine. Notwithstanding the foregoing,
for purposes of this Lease, “Operating Costs” shall not
include:

 

 

8

 

 

 

 

2.25.1.
Costs
(including permit, license and inspection costs) incurred in
renovating or otherwise improving, decorating or redecorating
rentable space for other tenants or vacant rentable
space;

 

2.25.2. Utilities or
services sold to Tenant or others for which Landlord is entitled to
and actually receives reimbursement (other than through any
operating cost reimbursement provision similar to the provisions
set forth in this Lease);

 

2.25.3. Except as otherwise
specifically provided in this Section, alterations to the Building
that are considered capital improvements or replacements of such
capital improvements under sound real estate management
principles;

 

2.25.4. Depreciation and
amortization, except on materials, small tools and supplies
purchased by Landlord to enable Landlord to supply services
Landlord might otherwise contract for with a third party, where
such depreciation and amortization would otherwise have been
included in the charge for such third party services, all as
determined in accordance with sound real estate management
principles;

 

2.25.5. Services or other
benefits that are not available to Tenant, but which are provided
to other tenants of the Building;

 

2.25.6. Overhead or any
profit increment paid to Landlord or to subsidiaries or affiliates
of Landlord for services in or in connection with the Building to
the extent the same exceeds the cost of such services that could be
obtained from equally qualified third parties on a competitive
basis or at market rates;

 

2.25.7. Except as otherwise
specifically provided in this Section, interest on debt or
amortization on any mortgages, other charges, costs and expenses
payable under any mortgage, if any, and costs for financing and
refinancing the Project;

 

2.25.8. Ground
rents;

 

2.25.9. Compensation and
employee benefits paid to clerks, attendants or other persons in
any commercial concession operated by Landlord, except the Building
parking facility;

 

2.25.10. Rentals and other
related expenses incurred in leasing equipment, the cost of which
would otherwise be excluded capital expenses hereunder, except
equipment used (a) in performing repairs and replacements and/or in
providing janitorial or similar services and which is not affixed
to the Building, or (b) in case of emergency;

 

2.25.11. Electrical power
for which Tenant directly contracts with and pays an electrical
service company;

 

2.25.12. Marketing costs,
including leasing commissions, attorneys’ fees in connection
with the negotiation and preparation of letters, deal memos,
letters of intent, leases, subleases and/or assignments, space
planning costs, and other costs and expenses incurred in connection
with lease, sublease or assignment negotiations and transactions
with present or prospective tenants or other occupants of the
Building, including attorneys’ fees and other costs and
expenditures incurred in connection with disputes with present or
prospective tenants or other occupants of the Building unless
related to the operation or maintenance of the Common
Areas;

 

2.25.13. Costs covered by
insurance, to the extent of the insurance proceeds actually
received by Landlord;

 

2.25.14. Costs covered by
warranties, to the extent of the amount actually paid under the
warranty;

 

2.25.15. Any service
provided directly to and paid directly by any tenant;
and

 

 

 

9

 

 

2.25.16.
Wages
and benefits of any employee who does not devote substantially all
of his or her employed time to the Building unless such wages and
benefits are prorated to reflect time spent on operating and
managing the Building vis-à-vis time spent on matters
unrelated to operating and managing the Building.

 

2.26. Permitted
Use. As set forth on
the Lease Summary.

 

2.27.
Permitted
Transfer. The day-to-day
sale and exchange of ownership interests in a publicly traded
entity on a recognized, domestic, national securities exchange or
over-the-counter in the ordinary course of business or an
assignment or subletting of all or a portion of the Premises to an
Affiliate of Tenant, where (a) the transferee assumes, in full, the
obligations of Tenant under this Lease; (b) Tenant remains fully
liable under this Lease; (c) the use of the Premises remains
unchanged; (d) after such transaction is effected, the tangible net
worth of the tenant hereunder is equal to or greater than the
tangible net worth of Tenant as of the date of this Lease; (e)
Landlord shall have received an executed copy of all documentation
effecting such transfer on or before its effective date; and (f)
the same is not a subterfuge by Tenant to avoid its obligations
under this Lease.

 

2.28. Permitted
Transferee. The Transferee
pursuant to a Permitted Transfer.

 

2.29. Project.
The Property, the Building and any other improvements on the
Property.

 

2.30. Project
Operating Costs. Operating Costs,
Taxes and Insurance.

 

2.31. Rent.
Base Rent and Additional Rent.

 

2.32. Rentable Area.

 

2.32.1. Rentable Area shall
be the measurement of rentable area or rentable square feet as
calculated by Landlord using the BOMA Standard Method for Measuring
Floor Area in Office Buildings as a guideline, as the same may be
modified and adopted by Landlord in its sole discretion from time
to time.

 

2.32.2. Except as provided
expressly to the contrary herein, Landlord reserves the right to
alter the Project, and in such event, the Rentable Area of the
Premises and the Project could likewise be revised. In addition,
the Rentable Area of the Project may from time to time be subject
to recalculation, as determined by Landlord. In the event of any
change in the Rentable Area of the Premises, the Base Rent and
other sums payable based on square footage shall be adjusted
accordingly.

 

2.33. 
Rules and Regulations. As set forth in
Exhibit G.

 

2.34. State.
The state in which the Project is located.

 

 

10

 

 

2.35. Taxes.
All taxes and assessments (whether special or general, ad valorem
or non-ad valorem, voluntary or non-voluntary and regardless of
whether the same are deductible for Landlord’s income tax
purposes), water and sewer charges, and other similar government
charges levied on or attributable to the Building or Project or
their operation, including, without limitation (a) real property
taxes or assessments levied or assessed against the Building or
Project; (b) assessments or charges levied or assessed against the
Building or Project by any redevelopment agency, municipality or
governmental or quasi-governmental agency, including but not
limited to any assessments or the Project’s contribution
towards a governmental or private cost-sharing agreement for the
purpose of augmenting or improving the quality of services and
amenities normally provided by governmental agencies, and any
assessments resulting from Landlord’s participation in a
“PACE” program; (c) any tax, assessment, levy, license
fee or charge measured by or based, in whole or in part, by Rent
received from the leasing of the Premises, the Building, or the
Project, or any portions thereof; (d) general or special, ad
valorem, non-ad valorem or specific, excise, capital levy, or other
tax, assessment, levy, or charge directly on the Rent received
under this Lease or on the rent received under any other leases of
space in the Building or Project; (e) any transfer, transaction, or
similar tax, assessment, levy, or charge based directly or
indirectly upon the transaction represented by this Lease or other
leases in the Project; (f) any franchise or margin tax imposed by
any governmental entity; (g) any possessory interest, occupancy,
use, per capita, or other tax, assessment, levy, or charge based
directly or indirectly upon the use or occupancy of the Premises or
other premises within the Building or the Project; (h) interest on
installments as charged by the taxing authority; and (i) the
reasonable costs and expenses of any contest or protest of Taxes
prosecuted by Landlord, including, without limitation, any
appraisal fees and attorneys’ fees. Taxes shall not include
(i) any net income, capital stock, estate or inheritance taxes
imposed by the State or Federal Government or their agencies,
branches, or departments; and (ii) tax penalties, interest or late
charges incurred as a result of Landlord’s failure to make
timely payment of Taxes. Notwithstanding the foregoing, if at any
time during the Term, the present method of taxation or assessment
shall be so changed that the whole or any part of the taxes,
assessments, levies, impositions or charges now levied, assessed or
imposed on the Project shall be discontinued or reduced and as a
substitute therefor, or in lieu of or in addition thereto, taxes,
assessments, levies, impositions or charges shall be levied,
assessed or imposed, wholly or partially, as a capital levy or
otherwise (a “Substitute Tax”), then such Substitute
Tax shall be included within the definition of Taxes. Tenant hereby
waives, and assigns, transfers and conveys to Landlord, any and all
rights to contest or protest any Taxes. At Landlord’s option,
Landlord shall pay assessments in installments over the longest
period of time permitted by the applicable
jurisdiction.

 

2.36. Telecommunications
Systems. All
telecommunications systems including but not limited to voice,
video, data, and any other telecommunications services provided
over wire, fiber optic, microwave, wireless, satellite and any
other transmission systems, for part or all of any
telecommunications within the Building or from the Building to any
other location.

 

2.37. Tenant
Related Parties. Tenant, its
Affiliates, agents, contractors, subcontractors, employees,
invitees, subtenants, transferees, and any other party claiming by,
through or under Tenant.

 

2.38. Tenant’s
Cost Allocation. The sum of the
following: (a) Tenant’s Proportionate Share of Operating
Costs for the year in question in excess of Tenant’s
Proportionate Share of Operating Costs incurred during the Base
Year; (b) Tenant’s Proportionate Share of Taxes for the year
in question in excess of Tenant’s Proportionate Share of
Taxes incurred during the Base Year; and (c) Tenant’s
Proportionate Share of Insurance for the year in question in excess
of Tenant’s Proportionate Share of Insurance incurred during
the Base Year. If at any time during the Term Operating Costs,
Taxes and/or Insurance are not based on a completed and fully
assessed Project having at least ninety-five percent (95%) of the
Rentable Area occupied, then Operating Costs, Taxes and/or
Insurance shall be adjusted by Landlord in order to fairly and
reasonably approximate the variable components of Operating Costs,
Taxes and/or Insurance for such year or applicable portion thereof,
employing sound accounting and management principles, that would
have been payable if the Project were completed, fully assessed and
at least ninety-five percent (95%) occupied. If any expense
(including without limitation any tax or insurance premium)
included within the Operating Costs, Taxes or Insurance incurred
during the Base Year is thereafter reduced or eliminated (an
“Expense Reduction”), then for the purpose of
calculating Tenant’s Cost Allocation, the applicable Base
Year amount shall be reduced to reflect the Expense
Reduction.

 

 

11

 

 

2.39. Tenant’s
Property. All movable
partitions, business and trade fixtures, machinery and equipment,
communications equipment, and office equipment located in the
Premises and acquired by or for the account of Tenant, without
expense to or reimbursement by Landlord, that can be removed
without damage to the Building, and all furniture, furnishings,
records, files and other articles of movable personal property
owned by Tenant and located in the Premises; however, in no event
shall Tenant’s Property include any equipment or other
property that Landlord reasonably determines is a leasehold
improvement (e.g., rooftop or supplemental air conditioning
units).

 

2.40. Tenant’s
Proportionate Share. As set forth on
the Lease Summary. Such share is a fraction, the numerator of which
is the Rentable Area of the Premises, and the denominator of which
shall be the Rentable Area of the Project. Tenant’s
Proportionate Share is subject to recalculation in accordance with
changes in the Rentable Area of the Premises or the Project.
Landlord reserves the right to create pools of similarly situated
tenants for the purpose of allocating certain Operating Costs that
benefit only the tenants in such pool (“Specialized Operating
Costs”). For the purpose of allocating Specialized Operating
Costs for any pool of which Tenant is a member, Tenant’s
Proportionate Share shall be a fraction, the numerator of which
shall be the Rentable Area of the Premises, and the denominator of
which shall be the Rentable Area of the premises of all tenants in
such pool.

 

2.41. Term.
As set forth on the Lease Summary, as the same may be extended from
time to time; however, the terms and provisions of this Lease shall
be effective as of the date of the full execution and delivery of
this Lease except for the provisions of this Lease relating to the
payment of Rent.

 

2.42. Transfer.
An assignment, mortgage, pledge, hypothecation, encumbrance, lien
or other transfer of this Lease or any interest hereunder, a
transfer by operation of law, a sublease or license of the Premises
or any part thereof, or the use of the Premises by any party other
than Tenant and its employees (including any assignment, mortgage,
pledge, hypothecation, encumbrance, lien or other transfer of this
Lease or any interest hereunder or a sublease of the Premises or
any part thereof by Tenant’s heirs and/or executors).
“Transfer” shall also include (a) if Tenant is a
partnership, limited liability company or any other non-corporate
entity, the withdrawal or change, voluntary, involuntary or by
operation of law, of twenty-five percent (25%) or more of the
partners, members or owners, or transfer of twenty-five percent
(25%) or more of partnership, membership or ownership interests,
within a twelve (12)-month period, or the dissolution of the
partnership or company without immediate reconstitution thereof,
(b) if Tenant is a corporation, the dissolution, merger,
consolidation or other reorganization of Tenant, the sale or other
transfer of more than an aggregate of twenty-five percent (25%) of
the voting shares of Tenant (other than to immediate family members
by reason of gift or death), within a twelve (12)-month period; and
(c) the sale, mortgage, hypothecation or pledge of more than an
aggregate of twenty-five percent (25%) of the value of the
unencumbered assets of Tenant within a twelve (12) month
period.

 

2.43. Transferee.
Any person or entity to whom or which any Transfer is
made.

 

ARTICLE 3

PREMISES AND
DELIVERY OF POSSESSION

 

3.1. Delivery
of Possession. Except as
otherwise provided herein, Landlord shall use commercially
reasonable efforts to deliver possession of the Premises on or
before the date in subsection (b) of Section 9(b) of the Lease
Summary. If for any reason, Landlord is delayed in delivering
possession of the Premises to Tenant, Landlord shall not be subject
to any liability for such failure, and the validity of this Lease
shall not be impaired, but (except in the case of delays caused by
Tenant, including Tenant’s failure to provide a certificate
of insurance evidencing the insurance required to be carried by
Tenant under this Lease) the date in subsection (b) of Section 9(b)
of the Lease Summary shall be extended for the period of such
delay.

 

 

 

12

 

 

3.2. Commencement
Date. If the
Commencement Date is not fixed on the Lease Summary, once the
Commencement Date is fixed, within ten (10) days following request
by Landlord, Tenant will execute and deliver to Landlord a
certificate substantially in the form of Exhibit D attached hereto
and made a part hereof, indicating thereon any exceptions thereto
that may exist at that time. Failure of Tenant to execute and
deliver such certificate within ten (10) days following its request
by Landlord shall constitute binding and conclusive acceptance of
the Premises and acknowledgment by Tenant that the statements
included in Exhibit D, as prepared by Landlord, are true and
correct.

 

ARTICLE 4

RENT

 

Tenant
agrees to pay to Landlord all Rent payable hereunder, without
set-off or deduction, in lawful money of the United States of
America. Tenant shall pay the Rent as follows:

 

4.1. Base
Rent. Tenant shall pay
to Landlord the Base Rent without notice, demand or offset, in
installments due and payable in advance on the first (1st) day of
each calendar month during the Term. Along with and in addition to
each monthly Base Rent payment under the Lease, Tenant shall pay to
Landlord any sales or privilege tax required under applicable Law.
In the event of any fractional calendar month, Tenant shall pay for
each day in such partial month a rental equal to 1/30 of the Base
Rent. Concurrent with Tenant’s execution of this Lease,
Tenant will deliver to Landlord the prepaid rent set forth in
Section 13 of the Lease Summary, which Landlord shall apply to the
sixth month’s Base Rent.

 

4.2. Tenant’s
Cost Allocation. For each calendar
year after the Base Year, in addition to the Base Rent and all
other payments due under this Lease, Tenant shall pay
Tenant’s Cost Allocation as follows:

 

4.2.1. Estimated
Payments. Tenant shall pay
Landlord’s reasonable estimate of Tenant’s Cost
Allocation for each calendar year of the Term (the “Estimated
Payment”) in advance, in monthly installments, commencing on
the first (1st) day of the month following the month in which
Landlord notifies Tenant of the amount it is to pay hereunder and
continuing until the first (1st) day of the month following the
month in which Landlord notifies Tenant of any revised Estimated
Payment. Landlord shall estimate from time to time the amount of
Tenant’s Cost Allocation for each calendar year of the Term,
make an adjustment to the Estimated Payment due for such calendar
year and notify Tenant of the revised Estimated Payment in writing.
Within fifteen (15) days after Tenant’s receipt of notice of
such adjustment and the revised Estimated Payment, Tenant shall pay
Landlord a fraction of such revised Estimated Payment for such
calendar year (reduced by any amounts paid pursuant to the first
sentence of this Section 4.2.1). Such fraction shall have as its
numerator the number of months which have elapsed in such calendar
year to the date of such payment, both months inclusive, and shall
have twelve (12) as its denominator. All subsequent payments by
Tenant for such calendar year shall be based upon such adjustment
and the revised Estimated Payment. In the event of any fractional
calendar month, Tenant shall pay for each day in such partial month
a rental equal to 1/30 of the Estimated Payment.

 

4.2.2. Reconciliation.
Within a reasonable period after the end of each calendar year,
Landlord shall deliver to Tenant a statement (the
“Statement”) setting forth Tenant’s Cost
Allocation for such year. If Tenant’s Cost Allocation for
such year exceeds the total of the Estimated Payment made by Tenant
for such year, Tenant shall pay Landlord the amount of the
deficiency within fifteen (15) days of the receipt of the Statement
and any amount payable by Tenant that would not otherwise be due
until after the termination of this Lease, shall, if the exact
amount is uncertain at the time that this Lease terminates, be paid
by Tenant to Landlord upon such termination in an amount to be
estimated by Landlord with an adjustment to be made once the exact
amount is known. If the Estimated Payment made by Tenant exceeds
Tenant’s Cost Allocation for such year, then Landlord shall
credit against Tenant’s next ensuing Estimated Payment(s) an
amount equal to the difference until the credit is exhausted. If a
credit is due from Landlord after the Expiration Date, Landlord
shall pay Tenant the amount of the credit after deducting therefrom
any amounts then owed by Tenant to Landlord. The obligations of
Tenant and Landlord to make payments required under this Section
shall survive the expiration or termination of this Lease, and
Landlord’s failure to deliver the Statement shall not be
deemed a waiver of Landlord’s right to make the adjustments
set forth herein.

 

 

13

 

 

4.2.3. Landlord’s
Records. Landlord shall
maintain records respecting Project Operating Costs and determine
the same in accordance with sound accounting and management
practices, consistently applied. Provided Tenant is not in Default,
Tenant or its representative experienced in auditing such records
(which may not be an accountant or other consultant compensated on
a contingency basis) shall have the right to examine such records
(which shall in no event include any other tenants’ leases or
Landlord’s tax returns or financial statements) upon
reasonable prior notice (except that no such examination may occur
during the months of December or April or during Landlord’s
fiscal year end, if other than December 31) specifying which
records Tenant desires to examine, during normal business hours at
a time mutually agreed upon by Landlord and Tenant and at the place
or places where such records are normally kept, by sending such
notice no later than sixty (60) days following the furnishing of
the Statement. Notwithstanding the foregoing, Tenant shall only
have the right to review Landlord’s records one (1) time
during any twelve (12) month period and may audit Landlord’s
records with respect to any given calendar year only once. Tenant
may take exception to matters included in Project Operating Costs
or Landlord’s computation of Tenant’s Proportionate
Share by sending notice specifying such exception and the reasons
therefor to Landlord (including any reports prepared by
Tenant’s representative and any accompanying data) no later
than thirty (30) days after Landlord makes such records available
for examination. If Tenant takes exception to any matter contained
in the Statement as provided herein, Landlord shall refer the
matter to an independent certified public accountant of
Landlord’s choice, subject to Tenant’s reasonable
approval, whose certification as to the proper amount shall be
final and conclusive as between Landlord and Tenant. Tenant shall
promptly pay the cost of such certification, including, without
limitation, any reasonable attorneys’ fees incurred by
Landlord in connection therewith, unless such certification
determines that Project Operating Costs were overstated by more
than five percent (5%) in the aggregate for the applicable year, in
which event Landlord shall pay the cost of such certification.
Pending resolution of any such exceptions in the foregoing manner,
Tenant shall continue paying Tenant’s Cost Allocation in the
amounts determined by Landlord, subject to adjustment after any
such exceptions are so resolved. Tenant acknowledges that any
information gathered through an audit is strictly confidential and
shall not disclose such confidential information to any person or
entity other than Tenant’s financial and legal consultants.
The Statement shall be considered final, except as to matters to
which exception is taken in the manner and within the times
specified herein.

 

4.3. Other
Taxes Payable by Tenant. In addition to
the Base Rent and any other charges to be paid by Tenant hereunder,
Tenant shall, as an element of Rent, reimburse Landlord upon demand
for any and all taxes payable by Landlord (other than net income
taxes) that are not otherwise reimbursable under this Lease,
whether or not now customary or within the contemplation of the
parties, where such taxes are upon, measured by, or reasonably
attributable to (a) the cost or value of Tenant’s equipment,
furniture, fixtures, and other personal property located at the
Premises, or the cost or value of any leasehold improvements made
in or to the Premises by or for Tenant, regardless of whether title
to such improvements is held by Tenant or Landlord; or (b) this
transaction or any document to which Tenant is a party creating or
transferring an interest or an estate in the Premises, including
but not limited to any sales tax on the Rent paid hereunder. If it
becomes unlawful for Tenant to reimburse Landlord for any taxes or
other charges as required under this Lease, the Base Rent shall be
revised to net Landlord the same net Rent after imposition of any
tax or other charge upon Landlord as would have been payable to
Landlord but for the reimbursement being unlawful.

 

4.4. Place
of Payment. All Rent shall be
paid at the address Landlord may from time to time designate in
writing and in no event shall Landlord’s acceptance of Rent
from any party other than the Tenant named in the Lease Summary
create a tenancy between Landlord and such party.

 

4.5. Interest
and Late Charges. If Tenant fails
to pay any Rent within five (5) days from when due, the unpaid
amounts shall bear interest at the Interest Rate. Tenant
acknowledges that the late payment of any Rent will cause Landlord
to incur costs and expenses not contemplated under this Lease,
including, without limitation, administrative and collection costs
and processing and accounting expenses, the exact amount of which
is extremely difficult to ascertain. Therefore, in addition to
interest, if any such payment is not received by Landlord within
five (5) days from when due, Tenant shall pay Landlord a late
charge equal to five percent (5%) of such payment. Landlord and
Tenant agree that this late charge represents a reasonable estimate
of such costs and expenses and is fair compensation to Landlord for
loss resulting from Tenant’s nonpayment. The late charge
shall be deemed Additional Rent and the right to require it shall
be in addition to all of Landlord’s other rights and remedies
hereunder or at law and shall not be construed as liquidated
damages for any default of Tenant or as limiting Landlord’s
remedies in any manner. In addition, any check returned by the bank
for any reason will be considered late and will be subject to all
late charges, plus a Fifty Dollar ($50.00) fee. After two (2)
returned checks in any twelve (12) month period, Landlord will have
the right to receive payment by a cashier’s check or money
order. Nothing contained herein shall be construed as to compel
Landlord to accept any payment of Rent in arrears or late charges
should Landlord elect to apply its rights and remedies available
under this Lease or at law or in equity in the event of a
Default.

 

 

14

 

 

ARTICLE 5

SECURITY
DEPOSIT

 

Upon
Tenant’s execution of this Lease, Tenant shall deposit with
Landlord the Security Deposit, as shown on the Lease Summary. The
Security Deposit shall serve as security for the prompt, full, and
faithful performance by Tenant of its obligations under this Lease.
In the event that Tenant is in Default hereunder, or in the event
that Tenant owes any amounts to Landlord upon the expiration of
this Lease, Landlord may use or apply the whole or any part of the
Security Deposit for the payment of Tenant’s obligations
hereunder. The use or application of the Security Deposit or any
portion thereof shall not prevent Landlord from exercising any
other right or remedy provided hereunder or under any Law and shall
not be construed as liquidated damages. In the event the Security
Deposit is reduced by such use or application, Tenant shall deposit
with Landlord, within ten (10) days after notice, an amount
sufficient to restore the full amount of the Security Deposit.
Landlord shall not be required to keep the Security Deposit
separate from Landlord’s general funds or pay interest on the
Security Deposit. Provided Tenant has performed all of its
obligations under this Lease, any remaining portion of the Security
Deposit shall be returned to Tenant within thirty (30) days
subsequent to the Expiration Date. If the Premises shall be
expanded at any time, or if the Term shall be extended at any
increased rate of Rent, the Security Deposit shall thereupon be
proportionately increased. No trust or fiduciary relationship is
created herein between Landlord and Tenant with respect to the
Security Deposit. If Landlord transfers the Premises during the
Term of this Lease, Landlord may pay the Security Deposit to
Landlord’s successor-in-interest, in which event the
transferring Landlord shall be released from all liability for the
return of the Security Deposit. Tenant waives the provisions of all
Laws now in force or that become in force after the date of
execution of this Lease, that require return of any remaining
Security Deposit within a specified period or limiting the costs,
expenses or damages for which Landlord may use a security deposit,
including any provisions of such Laws providing that Landlord may
claim from a security deposit only those sums reasonably necessary
to remedy defaults in the payment of Rent, to repair damage caused
by Tenant, or to clean the Premises. Landlord and Tenant agree that
Landlord may, in addition, claim those sums reasonably necessary to
compensate Landlord for any other foreseeable or unforeseeable loss
or damage caused by the acts or omissions of Tenant or any Tenant
Related Party.

 

ARTICLE 6

USE

 

6.1. Permitted
Use. Tenant shall use
the Premises solely for the Permitted Use as shown on the Lease
Summary, and for no other purpose without Landlord’s consent
(which consent may be withheld in Landlord’s sole
discretion). Tenant shall comply with all recorded covenants,
conditions, and restrictions, and the provisions of all ground or
underlying leases, now or hereafter affecting the Project. Tenant
shall, at Tenant’s expense, comply with all insurance company
and/or Mortgagee requirements pertaining to the use of the
Premises. Tenant shall not (a) do or permit anything to be done in
or about the Premises that would in any way obstruct or interfere
with the rights of other tenants or occupants of the Building or
Project or violate any restrictions or exclusive uses set forth in
any other tenants’ leases; (b) injure, annoy or interfere
with the business of any other tenants or occupants of the Project
or any of their invitees; (c) cause, maintain or permit any
nuisance arising out of Tenant’s use or occupancy of the
Premises; or (d) commit or suffer to be committed any waste in or
upon the Premises, the Building or the Project. Tenant acknowledges
that the Building and/or Project has, or in the future may seek, a
USGBC or other “green agency” rating and, as a result,
the Building and/or Project will be operated pursuant to
Landlord’s sustainable practices (as the same may be modified
by Landlord from time to time) and, in connection therewith, Tenant
(i) shall comply with such practices, and (ii) shall not do or
permit anything to be done in or about the Premises that would in
any way jeopardize any such rating.

 

6.2. Compliance
with Law. Tenant
acknowledges and agrees that, except as may otherwise be
specifically provided in this Lease, Landlord has made no
representation or warranty as to whether the Premises, the Building
or the Project conforms to the requirements of Law. Tenant shall be
responsible for compliance of the non-structural portions of the
Premises with applicable Law and shall bear all costs necessary to
maintain the non-structural portions of the Premises in compliance
with Law. Tenant shall also be responsible for the cost of any
structural work in the Premises and/or any alterations to other
portions of the Building or the Project necessitated by any
Alterations or any change in use of the Premises initiated by
Tenant after the Commencement Date. Tenant shall not use or occupy
the Premises in violation of any Law or the certificate of
occupancy issued for the Building or the Project and shall, upon
notice from Landlord, immediately discontinue any use of the
Premises that is declared by any governmental authority having
jurisdiction to be a violation of Law or the certificate of
occupancy. A judgment of any court of competent jurisdiction or the
admission by Tenant in any action or proceeding against Tenant that
Tenant has violated any such Laws in the use of the Premises shall
be deemed to be a conclusive determination of that fact as between
Landlord and Tenant. Should any obligation be imposed by Law, then
Tenant agrees, at its sole cost and expense, to comply promptly
with such obligations to the extent the same relate to the Premises
or Tenant’s use of the Premises, the Building or the
Project.

 

 

15

 

 

Landlord
represents and warrants to Tenant that, to Landlord’s actual
knowledge (without investigation) as of the date of this Lease,
Landlord has not received any written notice that the Premises is
currently in violation of any applicable Laws.

 

6.3. Effect
on Landlord’s Insurance. Tenant shall not
do or permit to be done anything that will invalidate or increase
the cost of any property coverage, or other insurance policy
covering the Building, the Project or any property located therein.
Tenant shall promptly, upon demand, reimburse Landlord for any
additional premium charged for such policy by reason of
Tenant’s failure to comply with the provisions of this
Section.

 

6.4. Intentionally
Omitted

 

6.5. Use
of Common Areas. Use of all Common
Areas by any Tenant Related Parties shall at all times be subject
to the Rules and Regulations and the exclusive control and
management of Landlord.

 

ARTICLE 7

HAZARDOUS
MATERIALS

 

7.1. Indemnity.
Tenant shall indemnify, defend and hold harmless all Landlord
Related Parties from and against all Claims directly or indirectly
arising out of the existence, use, generation, migration, storage,
transportation, release, threatened release, or disposal of
Hazardous Materials (including, without limitation, the Permitted
Materials (hereinafter defined)) in, on, or under the Premises, the
Building or the Project or in the groundwater under the Project and
the migration or transportation of Hazardous Materials to or from
the Premises, the Building or the Project or the groundwater
underlying the Project, to the extent that any of the foregoing is
caused by any Tenant Related Parties. This indemnity extends to the
costs incurred by any Landlord Related Party to investigate,
remediate, monitor, treat, repair, clean-up, dispose of, or remove
such Hazardous Materials in order to comply with the Environmental
Laws; provided that if Tenant is not otherwise in Default, Landlord
shall give Tenant not less than thirty (30) days’ advance
notice of Landlord’s intention to incur such
costs.

 

7.2. Restriction
on Hazardous Materials. Tenant shall not
permit any Tenant Related Parties to use, generate, manufacture,
store, transport, release, threaten release, or dispose of
Hazardous Materials in, on, or about the Premises, the Building or
the Project or transport Hazardous Materials from the Premises, the
Building or the Project unless Tenant shall have received
Landlord’s prior consent therefor, which Landlord may revoke
at any time, and shall not cause or permit the release or disposal
of Hazardous Materials from the Premises, the Building or the
Project except in compliance with applicable Environmental
Laws; provided, however,
Tenant shall be permitted to use and store at the Premises de
minimis amounts of customary office and cleaning supplies in
compliance with applicable Environmental Laws (the “Permitted
Materials”). Tenant shall promptly deliver notice to Landlord
if Tenant obtains knowledge sufficient to infer that Hazardous
Materials are located on the Premises, the Building or the Project
that are not in compliance with applicable Environmental Laws or if
any third party, including without limitation, any governmental
agency, claims a significant disposal of Hazardous Materials
occurred on the Premises, the Building or the Project or is being
or has been released from the Premises, the Building or the
Project.

 

 

16

 

 

7.3. Investigation
of Contamination. Upon reasonable
written request of Landlord, Tenant, through its appropriately
qualified and licensed professional engineers, and at
Tenant’s cost, shall thoroughly investigate suspected
Hazardous Materials contamination of the Premises, the Building or
the Project that would arguably come within the scope of
Tenant’s indemnification and hold harmless obligations as set
forth above. Tenant, using duly licensed and insured contractors
approved by Landlord, shall promptly commence and diligently
complete the removal, repair, clean-up, and detoxification of any
Hazardous Materials from the Premises, the Building and the Project
as may be required by applicable Environmental Laws that comes
within the scope of Tenant’s indemnification and hold
harmless obligations as set forth above. The provisions of this
Article shall survive the expiration or earlier termination of this
Lease.

 

ARTICLE 8

SERVICES AND
UTILITIES

 

8.1. Furnishing
of Building Services. Landlord agrees
to furnish the Building Services as set forth on Exhibit F. Within five (5) days
of Landlord’s request, Tenant shall provide to Landlord all
requested information regarding Tenant’s utility and energy
usage at the Premises during the Term (which requested information
may include number of computers used in the Premises, operating
hours, number of employees per shift and other similar
information). Tenant acknowledges that such information may be
disclosed to third parties, including governmental agencies and
current, potential or future Mortgagees and/or prospective
purchasers. Tenant’s obligation to provide any of the
foregoing with respect to any period of time during the Term shall
survive the expiration or earlier termination of this
Lease.

 

8.2. Interruption
in Services. Landlord shall
not be in default hereunder nor be liable for any damages directly
or indirectly resulting from, nor shall the Rent be abated, for any
interruption of or diminution in the quality or quantity of
Building Services, including, without limitation, when the same is
occasioned, in whole or in part, by (a) repairs, replacements, or
improvements; (b) by inability to secure or limitation,
curtailment, or rationing of, or restrictions on, use of
electricity, gas, water, or other form of energy serving the
Premises, the Building or the Project; (c) by any accident or
casualty; (d) by act or Default by Tenant or other parties; or (e)
by Force Majeure. No failure, delay or diminution in Building
Services shall ever be deemed to constitute an eviction or
disturbance of Tenant’s use and possession of the Premises or
relieve Tenant from paying Rent or performing any of its
obligations under this Lease. Furthermore, Landlord shall not be
liable under any circumstances for loss of, or injury to, property
or for injury to, or interference with, Tenant’s business,
including, without limitation, loss of profits, however occurring,
through or in connection with or incidental to a failure, delay or
diminution of any Building Services.

 

8.3. Extraordinary
Demand. If Landlord
determines that Tenant’s use of the Premises, Building and/or
Project requires Landlord to provide increased levels of any
Building Services (including security services), including but not
limited to Tenant’s use of heat generating machines or
equipment in the Premises that affect the temperature otherwise
maintained by the heating, ventilation and air-conditioning system,
Landlord reserves the right to provide increased levels of such
Building Services (including security services) as a result
thereof, including the right to install supplementary
air-conditioning units in the Premises; and the cost of any and all
such increased Building Services (including, without limitation,
the cost of installation, operation, and maintenance of any such
supplementary air-conditioning units) shall be paid by Tenant upon
demand by Landlord.

 

8.4. Customary
Quantities. Tenant shall not
consume water or electric current in excess of that usually
furnished or supplied for the use of the Premises as general office
space (as determined by Landlord) without first procuring the
consent of Landlord, and in the event of consent, Landlord may
install a water meter or electrical meter in the Premises to
measure the amount of water or electric current consumed. Tenant
shall bear the cost of any such meter and of its installation,
maintenance, and repair, and Tenant agrees to pay to Landlord
promptly, upon demand, for all water and electric current consumed
as shown by said meters at the rates charged for such services by
the local public utility plus any additional reasonable expense
incurred in keeping account of the water and electric current so
consumed. If a separate meter is not installed, the excess cost for
water and electric current shall be established by an estimate made
by a utility company or electrical engineer hired by Landlord at
Tenant’s expense. Tenant shall not use any apparatus or
device in the Premises that uses in excess of 120 volts. Tenant
shall not connect any apparatus with electric current except
through existing electrical outlets in the Premises.

 

 

17

 

 

8.5. Separate
Metering. Nothing in this
Article shall restrict Landlord’s right to require at any
time separate metering of utilities furnished to the Premises at
Tenant’s sole cost. In the event utilities are separately
metered, Tenant shall be responsible for the maintenance, repair
and replacement of any such meters at its sole cost and
expense.

 

8.6. Safety
and Security Devices, Services, and Programs. The parties
acknowledge that safety and security devices, services, and
programs provided by Landlord, if any, while intended to deter
crime and ensure safety, may not in given instances prevent theft
or other criminal acts or ensure safety of persons or property. The
risk that any safety or security device, service, or program may
not be effective, or may malfunction, or be circumvented by a
criminal, is assumed by Tenant with respect to Tenant’s
property and interests; and Tenant shall obtain insurance coverage
to the extent Tenant desires protection against such criminal acts
and other losses. Tenant agrees to cooperate in any reasonable
safety or security program developed by Landlord or required by
Law.

 

8.7. Utility
Deregulation. If permitted by
applicable Law at any time in the future, Landlord shall have the
right at any time and from time to time during the Term to either
contract for electricity service from different companies providing
electricity service (each such company shall hereinafter be
referred to as an “Alternate Service Provider”), and
the costs, charges or expenses reasonably incurred by Landlord to
change such service shall be an Operating Cost hereunder. Tenant
agrees to cooperate with Landlord and any Alternate Service
Provider at all times and, as reasonably necessary, to provide
reasonable access to any electric facilities within the Premises.
Tenant may not elect to use any electricity service provider other
than the one designated by Landlord for the Building without the
prior consent of Landlord, which consent may be withheld in
Landlord’s sole discretion.

 

8.8. Government
Energy or Utility Controls. In the event of
imposition of any government controls, rules, regulations, or
restrictions on the use or consumption of energy or other utilities
during the Term, both Landlord and Tenant shall be bound thereby,
and the same shall not constitute a constructive eviction of
Tenant. In the event of a difference in interpretation by Landlord
and Tenant of any such controls, Landlord’s interpretation
shall prevail, and Landlord shall have the right to enforce
compliance therewith, including, without limitation, the right of
entry into the Premises to effect compliance.

 

8.9. Telecommunications.
Tenant and Tenant’s telecommunications companies, including
but not limited to local exchange telecommunications companies and
alternative access vendor services companies
(“Telecommunications Companies”), shall have no right
of access to or within the Project for the installation and
operation of Tenant’s Telecommunications System without
Landlord’s prior consent. All work with respect to
Tenant’s Telecommunications System shall be subject to the
terms of Article 11 of this Lease and such work shall be deemed to
be an Alteration (except that the requirement to request consent
thirty (30) days prior to commencement of any work shall not apply
with respect to Tenant’s initial telecommunications work in
the Premises). Without in any way limiting Landlord’s right
to withhold its consent to a proposed request for access, Landlord
shall have the right to consider whether a Telecommunications
Company is willing to pay reasonable monetary compensation for the
use and occupation of the Building for the Telecommunications
System.

 

ARTICLE 9

CONDITION OF THE
PREMISES

 

Tenant
acknowledges that Tenant is leasing the Premises on an “as
is, where is” basis. Tenant’s taking possession of the
Premises shall be deemed conclusive evidence that, as of the date
of taking possession, the Premises were in good order and
satisfactory condition. No promise of Landlord to alter, remodel,
repair, or improve the Premises, the Building or the Project, and
no representation, express or implied, respecting any matter or
thing relating to the Premises, the Building, the Project or this
Lease (including, without limitation, the condition thereof) have
been made to Tenant by Landlord or its broker or sales agent, other
than as may be expressly contained in this Lease.

 

 

18

 

 

ARTICLE 10

REPAIRS AND
MAINTENANCE

 

10.1. Landlord’s
Obligations. Landlord shall
maintain in good order, condition, and repair the portions of the
Building, the Project and the Premises that are not the obligation
of Tenant or any other tenant in the Building. Tenant shall give
Landlord prompt notice of any damage to or defective condition in
any part or appurtenance of the Building Systems serving, located
in, or passing through the Premises or any other damage that
Landlord is obligated to repair. Tenant hereby waives and
relinquishes any right Tenant may have under any applicable Law now
or hereafter in effect to make any repairs at Landlord’s
expense.

 

10.2. Tenant’s
Obligations. Tenant, at
Tenant’s sole expense, shall maintain, repair and replace the
Premises as needed to keep all interior, non-structural portions of
the Premises in good order, condition, and repair, including,
without limitation, the following: (a) all plumbing and sewage
facilities, including but not limited to all plumbing fixtures,
pipes, fittings, or other parts of the plumbing system that
exclusively serve the Premises; (b) all fixtures, interior walls,
floors, carpets, draperies, window coverings, and ceilings; (c) all
interior windows, doors, entrances, and plate glass; (d) all
electrical wiring, facilities and equipment, including, without
limitation, any non-standard light fixtures, lamps, bulbs, tubes,
fans, vents, exhaust equipment, and systems; and (e) any fire
detection or extinguisher equipment that Landlord does not
maintain.

 

10.3. Damage
by Tenant. Except for
ordinary wear and tear, Tenant shall promptly reimburse Landlord
for any costs that Landlord may incur in making repairs and
alterations in and to the Premises, the Building, Building Systems,
the Project or facilities, systems or equipment of the Project (and
in no event shall the provisions of Section 18.7 apply to such
reimbursement obligation), where the need for such repairs or
alterations is caused by any of the following: (a) Tenant’s
use or occupancy of the Premises in a fashion that contravenes any
provision of this Lease; (b) the installation, removal, use, or
operation of Tenant’s Property; (c) the moving of
Tenant’s Property into or out of the Building; or (d) any
misuse, tortious act, omission, or negligence of any Tenant Related
Parties.

 

10.4. Load
and Equipment Limits. Tenant shall not
place a load upon the Premises that exceeds the load per square
foot that the structural portions of the Premises were designed to
carry, as determined by Landlord or Landlord’s structural
engineer. If Landlord or Landlord’s structural engineer
determines that any improvement or load placed upon the Premises
exceeds the load per square foot that the structural portions of
the Premises were designed to carry, then Tenant shall remove such
load or otherwise remedy such fact to Landlord’s
satisfaction. Upon demand, Tenant shall pay the cost of any such
determination.

 

ARTICLE 11

ALTERATIONS AND
ADDITIONS

 

11.1. Tenant’s
Alterations. Tenant shall not
make any additions, alterations, or improvements (the
“Alterations”) to the Premises without the prior
consent of Landlord, which consent shall be requested by Tenant at
least thirty (30) days prior to the commencement of any work and
such request for consent shall include (A) Tenant’s proposed
plans and specifications for the Alterations, (B) a detailed
critical path construction schedule containing the major components
of the Alterations and the time required for each, including the
scheduled construction commencement date, milestone dates and the
estimated completion date, (C) an itemized statement of estimated
construction costs, including fees for permits and architectural
and engineering fees, (D) evidence satisfactory to Landlord of
Tenant’s ability to pay the cost of the Alterations, (E) the
names and addresses of Tenant’s contractors (and said
contractors’ subcontractors) and materialmen to be engaged by
Tenant for the Alterations (individually, a “Tenant
Contractor,” and collectively, “Tenant’s
Contractors”); however, Landlord may designate a list of
approved contractors for any portions of the Alterations involving
the Building’s structure or the Building Systems, from which
Tenant must select its contractors for such portions of the
Alterations (“Approved Contractors”), and (F)
certificates of insurance, evidencing the insurance required under
this Article 11. Landlord’s consent to the Alterations (and
Landlord’s approval of Tenant’s plans and
specifications therefor) shall not be unreasonably withheld,
conditioned or delayed and any changes or modifications to the
Alterations or such plans or specifications thereafter shall
require Landlord’s approval (which shall not be unreasonably
withheld). Landlord’s review and approval of the plans and
specifications for the Alterations shall create no responsibility
or liability on the part of Landlord for their completeness, design
sufficiency, or compliance with all Laws. Notwithstanding the
foregoing, Tenant shall have the right during the Term to make
cosmetic Alterations as Tenant may reasonably deem desirable or
necessary (the “Cosmetic Alterations”), without
Landlord’s consent, provided that such Alterations (i) are
not visible from outside of the Premises; (ii) do not affect the
Building’s structure or any Building System; (iii) do not
trigger any legal requirement which would require any alteration or
improvements to the Building or Project; (iv) do not, in the
aggregate, exceed $5,000 (for Alterations other than floor and wall
covering) in any twelve (12) month period; and (v) do not require
any license, permit or approval under applicable Law and do not
result in the voiding of Landlord’s insurance, the increasing
of Landlord’s insurance risk or the disallowance of sprinkler
credits. Tenant shall give Landlord at least ten (10) days prior
written notice of such Cosmetic Alterations, which notice shall be
accompanied by reasonably adequate evidence that such changes meet
the foregoing criteria. Except as otherwise provided, the term
“Alterations” shall include Cosmetic
Alterations.

 

 

19

 

 

11.2. Construction
Requirements. All Alterations
shall be (a) performed under a valid permit when required, a
copy of which shall be furnished to Landlord before commencement of
construction, (b) performed in a good and workmanlike manner using
only new, first class materials and Tenant shall obtain
contractors’ warranties for a period of at least one (1) year
against defects in materials and workmanship; (c) performed in
compliance with all applicable Laws, all applicable standards of
the American Insurance Association (formerly, the National Board of
Fire Underwriters), the National Electrical Code,
manufacturer’s specifications and Landlord’s
construction rules and regulations attached hereto as Exhibit E-2 (the
“Construction Rules”); (d) performed so as not to
cause or create any jurisdictional or other labor disputes;
(e) performed in such manner as not to obstruct access to the
Project or the Common Areas or the conduct of business by Landlord
or other tenants in the Project and coordinated with any other work
in the Project by Landlord or its tenants in order to minimize
interference with such work; (f) diligently prosecuted to
completion; (g) if applicable, performed in a manner that will not
adversely affect the Building’s and or Project’s
“LEED” certification, Energy Star rating or other
“green agency” rating, and (i) performed (A) in
compliance with USGBC indoor air quality standards and waste
management specifications, and (B) if to the extent applicable,
utilizing plumbing fixtures that comply with the EPA’s
“Water Sense” program and Energy Star compliant
equipment, and (h) performed by Tenant’s Contractors that are
approved by Landlord and, at Landlord’s election, Landlord
shall have the right to have at least one (1) additional contractor
selected by Landlord (“Landlord’s
Contractors”), submit a bid for the Alterations and
Landlord shall notify Tenant of any Landlord’s Contractors it
elects to have submit a bid for the Alterations at the time
Landlord approves Tenant’s Contractors.  If Landlord
elects to have any Landlord’s Contractors submit a bid for
the Alterations, then promptly after Tenant receives all bids, and
based upon the bids submitted by Tenant’s Contractors and
Landlord’s Contractor(s), Tenant shall notify Landlord in
writing of its recommendation for the contractor to perform the
Alterations, which notice shall include copies of all bids (the
“Bid
Package”).  If Tenant’s recommendation for
a contractor for the Alterations is not a Landlord’s
Contractor, then within five (5) Business Days after
Landlord’s receipt of the Bid Package, Landlord shall either
(A) allow Tenant to use its recommended contractor for the
Alterations, or (B) require Tenant to use a Landlord’s
Contractor for the Alterations. If Landlord elects to proceed under
subsection (B) and the bid of the required Landlord’s
Contractor (excluding costs incurred for any change orders) for the
Alterations exceeds one hundred ten percent (110%) of the bid of
Tenant’s recommended contractor for the Alterations, then
Landlord shall reimburse Tenant for the cost of the work performed
by Landlord’s Contractor in excess of one hundred ten percent
(110%) of the bid of Tenant’s recommended contractor within
thirty (30) days of Tenant’s completion of the Alterations
and Landlord’s receipt of unconditional lien releases
therefor.

 

Tenant
agrees to (1) carry (or cause its general contractor to carry)
Causes of Loss-Special Form Builder’s Risk or Installation
Floater insurance with a limit of not less than the total cost of
the Alterations, in such form and including such terms, conditions
and deductibles as are acceptable to Landlord in its sole but
reasonable discretion, covering the construction of such
Alterations, and (2) cause all of Tenant’s Contractors to
agree, in their construction contracts with Tenant, to meet all of
the insurance requirements applicable to Tenant pursuant to Article
18 (including providing the certificates of insurance required
thereunder). Tenant shall pay to Landlord a percentage of the cost
of the Alterations (such percentage, which shall vary depending
upon whether or not Tenant orders the work directly from Landlord,
to be established by Landlord on a uniform basis for the Project)
sufficient to compensate Landlord for all overhead, general
conditions, fees and other costs and expenses arising from
Landlord’s supervision of or involvement with the
Alterations. Additionally, Tenant shall engage the services of an
on-site project manager reasonably acceptable to Landlord, who
shall perform daily supervision of the Alterations and who shall be
familiar with Landlord’s construction procedures for the
Project (including the Rules and Regulations and the Construction
Rules). Landlord may require, at Landlord’s sole option, that
Tenant provide to Landlord such security as reasonably determined
by Landlord to protect Landlord against any liability in connection
with the Alterations, including but not limited to a lien and
completion bond naming Landlord as a co-obligee. Promptly after
completion of any Alterations, Tenant shall deliver to Landlord
“as-built” plans and specifications (including all
working drawings) for the Alterations.

 

Landlord shall have
the right to inspect the construction of the Alterations; however,
Landlord’s failure to inspect any portion of the Alterations
shall in no event constitute a waiver of any of Landlord’s
rights under this Article 11, nor shall Landlord’s inspection
of any portion of the Alterations constitute Landlord’s
approval thereof. If, as a result of Landlord’s inspection,
Landlord disapproves of any portion of the construction of the
Alterations, Landlord shall notify Tenant in writing of such
disapproval and shall specify the items disapproved. In the event
Landlord disapproves of any matter that might adversely affect any
Building System, the structure or exterior appearance of the
Building or any other tenant, Landlord may take such action as
Landlord deems necessary, at Tenant’s expense and without
incurring any liability on Landlord’s part, to correct any
such matter, including, without limitation, causing the cessation
of the applicable work.

 

 

 

20

 

 

11.3. Landlord’s
Property; Removal. All fixtures,
equipment, leasehold improvements (including any Alterations), and
appurtenances attached to or built into the Premises at the
commencement of or during the Term, whether or not by or at the
expense of Tenant, other than Tenant’s Property, shall be and
remain a part of the Premises, shall be the property of Landlord,
and shall not be removed by Tenant, unless: (i) such removal is
necessary to ensure that the Premises and Building comply with
applicable code at the time of surrender, including but not limited
to removal of wires located in risers and plenums without raceways
or conduits; or (ii) Landlord notified Tenant in writing that
removal would be required at least thirty (30) days prior to the
Expiration Date (however, if this Lease terminates prior to the
Expiration Date, such thirty (30) day period shall not apply). In
each of the foregoing circumstances, Tenant shall perform such
removal and repair any damage caused thereby at Tenant’s sole
cost and expense prior to the expiration or earlier termination of
this Lease, unless Landlord notifies Tenant in writing that
Landlord will perform such removal on Tenant’s behalf and at
Tenant’s sole cost and expense, in which case Tenant shall
reimburse Landlord for all of Landlord’s costs incurred for
such removal within ten (10) days of demand.

 

11.4. Lien
Free Completion. Tenant shall use
its best efforts to obtain or cause to be obtained and delivered to
Landlord written, unconditional waivers of mechanics' and
materialman’s liens against the Premises, the Building and
the Project from each of Tenant’s contractors and
subcontractors. Subcontractor waivers shall be separate from the
construction contract and shall be provided prior to the
commencement of construction. If Tenant is unable to obtain or
cause to be obtained any such waiver prior to commencement of the
construction, Tenant shall give written notice of such fact to
Landlord, and Landlord at its option shall have the right to
disapprove such contractor or subcontractor or to require Tenant to
furnish security or make other arrangements satisfactory to
Landlord to assure payment for the completion of all Alterations
free and clear of liens. Upon completion of the Alterations, Tenant
shall deliver to Landlord sworn statements setting forth the names
of all material suppliers and contractors and subcontractors who
did work on the Alterations and full and final lien waivers from
all such contractors, subcontractors and material suppliers.
Additionally, if Tenant fails to make any payment relating to the
Alterations, Landlord, at its option, may complete the Alterations
and/or make such payment and Tenant shall reimburse Landlord for
all costs incurred therefor within five (5) days of
Landlord’s demand.

 

11.5. Notices
and Liens. Tenant agrees not
to suffer or permit any lien of any mechanic or materialman to be
placed or filed against the Premises, the Building or the Project.
In case any such lien shall be filed, Tenant shall satisfy and
release such lien of record within twenty (20) days (or such
shorter period as may be required by any Mortgagee) after the
earlier to occur of (a) receipt of notice thereof from
Landlord; or (b) Tenant’s actual knowledge or notice of
such lien filing. If Tenant shall fail to have such lien satisfied
and released of record as provided herein, Landlord may, on behalf
of Tenant, without being responsible for making any investigation
as to the validity of such lien and without limiting or affecting
any other remedies Landlord may have, pay the same and Tenant shall
reimburse Landlord on demand for such amount together with any
other reasonable costs of Landlord, including, without limitation,
reasonable attorneys’ fees and/or Landlord shall have the
right to deduct such costs from the Allowance (if any).
Notwithstanding the foregoing, Tenant shall have the right to
contest any such lien claim diligently and in good faith, and
during such contest shall not be obligated to pay such lien claim,
provided that Tenant is not in breach of any of its obligations
under this Lease and provided, Tenant, at its sole cost and
expense, bonds the lien, or transfers the lien from the Property to
a bond, thereby freeing the Project from any claim of lien.
Notwithstanding any such contest or title insurance, Tenant shall
pay any such claim in full within five (5) days following the entry
of an unstayed judgment or order of sale. All materialmen,
contractors, artisans, mechanics, laborers and any other person now
or thereafter furnishing any labor, services, materials, supplies
or equipment to Tenant with respect to Premises or any portion
thereof, are hereby charged with notice that they must look
exclusively to Tenant to obtain payment for the same. Notice is
hereby given that Landlord shall not be liable for any labor,
services, materials, supplies, skill, machinery, fixtures or
equipment furnished to or to be furnished to Tenant upon credit and
that no mechanic’s lien or any other lien for any such labor,
services, materials, supplies, machinery, fixtures or equipment
shall attach to or affect the estate or interest of Landlord in and
to the Premises or the Project, or any portion thereof. Before the
actual commencement of any work for which a claim or lien may be
filed, Tenant shall give Landlord notice of the intended
commencement date a sufficient time before that date to enable
Landlord to post notices of nonresponsibility or any other notices
that Landlord deems necessary for the protection of
Landlord’s interest in the Premises, Building or the Project,
and Landlord shall have the right to enter the Premises and post
such notices at any reasonable time.

 

 

21

 

 

ARTICLE 12

CERTAIN RIGHTS
RESERVED BY LANDLORD

 

Landlord reserves
the following rights, exercisable without liability to Tenant for
(a) damage or injury to property, person, or business;
(b) causing an actual or constructive eviction from the
Premises; or (c) disturbing Tenant’s use, possession, or
beneficial and quiet enjoyment of the Premises:

 

12.1. Name.
To change the name or street address of the Building or the
Project.

 

12.2. Signage.
To install and maintain signs on the exterior and interior of the
Building and the Project.

 

12.3. Keys.
To have passkeys to the Premises and all doors within the Premises,
excluding Tenant’s vaults and safes.

 

12.4. Inspection
and Entry. Landlord may
enter the Premises on reasonable prior notice to Tenant (except in
the event of an emergency, in which case no notice shall be
required) (a) to inspect the Premises; (b) to show the
Premises to any prospective purchaser or Mortgagee of the Project,
or to others having an interest in the Project or Landlord;
(c) during the existence of a Default; (d) during the
last six (6) months of the Term, to show the Premises to
prospective tenants; (e) to make inspections, repairs,
alterations, additions, or improvements to the Premises or the
Building (including, without limitation, checking, calibrating,
adjusting, or balancing controls and other parts of the heating,
ventilation and air-conditioning system); and (f) to take all
steps as may be necessary or desirable for the safety, protection,
maintenance, or preservation of the Premises or the Building or
Landlord’s interest therein, or as may be necessary or
desirable for the operation or improvement of the Building or in
order to comply with Laws.

 

12.5. Renovations.
Landlord may during the Term renovate, improve, alter, or modify
(collectively, the “Renovations”) the Building, the
Premises, or the Project, including without limitation, Common
Areas, Building Systems, roof, and structural portions of the
Building. Renovations may include, without limitation,
(a) modifying the Common Areas and tenant spaces to comply
with applicable Laws, including, without limitation, regulations
relating to the physically disabled, seismic conditions, and
building safety and security; and (b) installing new
carpeting, lighting, and wall coverings in the Common Areas. In
connection with such Renovations, Landlord may, among other things,
erect scaffolding or other necessary structures in the Building,
limit or eliminate access to portions of the Building or Project,
including, without limitation, portions of the Common Areas, or
perform work in the Building that may create noise, dust or leave
debris. Tenant hereby agrees that such Renovations and
Landlord’s actions in connection with such Renovations shall
in no way constitute a constructive eviction of Tenant nor entitle
Tenant to any abatement of Rent. Landlord shall have no
responsibility or for any reason be liable to Tenant for any direct
or indirect injury to or interference with Tenant’s business
arising from the Renovations, nor shall Tenant be entitled to any
compensation or damages from Landlord for inconvenience, annoyance
or loss of the use of any part of the Premises or of Tenant’s
Property resulting from the Renovations.

 

12.6. Common
Areas. Landlord shall
have the right to eliminate or change the size, location and
arrangement of the Common Areas; to enter into, modify and
terminate easements and other agreements pertaining to the use and
maintenance of the Common Areas; to close all or any portion of the
Common Areas as may be necessary to prevent a dedication thereof or
the accrual of any rights to any person or to the public therein;
to close temporarily any or all portions of the Common Areas; and
to do and perform such other acts in and to the Common Areas as
Landlord shall determine to be advisable for the convenience and
use thereof by owners, occupants, tenants and invitees of the
Building.

 

 

22

 

 

12.7. Minimize
Interference. In the exercise
of the rights set forth in this Article 12, Landlord shall (except
in an emergency) take reasonable steps to minimize any interference
with Tenant’s business.

 

ARTICLE 13

RULES AND
REGULATIONS

 

Tenant
shall comply with (and cause all Tenant Related Parties to comply
with) the Rules and Regulations. Landlord shall not be responsible
for any violation of the Rules and Regulations by other tenants or
occupants of the Building or Project. All Rules and Regulations,
whether now existing or hereafter adopted by Landlord, shall be
non-discriminatory in nature.

 

ARTICLE 14

TRANSFERS

 

Except
as provided in this Article, Tenant shall not, without the prior
consent of Landlord, make any Transfer.

 

14.1. Notice.
Tenant shall notify Landlord of any proposed Transfer (a
“Transfer Notice”). The date of the proposed Transfer
must be not less than forty-five (45) days or more than one hundred
eighty (180) days after the date of the Transfer Notice. The
Transfer Notice shall include (a) the proposed effective date
of the Transfer; (b) a description of the portion of the
Premises to be transferred (the “Subject Space”);
(c) all of the terms of the proposed Transfer and the
consideration therefor, including, without limitation, a
calculation of the Transfer Premium (as defined below);
(d) the name and address of the Transferee; (e) current
financial statements of the Transferee certified by an officer,
partner or owner thereof; (f) any other information that will
enable Landlord to determine the financial responsibility,
character, and reputation of the Transferee and the nature of such
Transferee’s business; and (g) the proposed use of the
Subject Space. Landlord shall respond to any properly delivered
Transfer Notice within thirty (30) days.

 

14.2. Fees.
Whether or not Landlord shall grant consent, Tenant shall pay
Landlord, concurrently with any request for consent a $1,000
administrative review and processing fee, and Tenant shall
reimburse Landlord, within thirty (30) days after written request
by Landlord for any legal fees incurred by Landlord in connection
with any request for consent.

 

14.3. Consent.
Landlord’s consent shall not be required for any Permitted
Transfer. Landlord shall not unreasonably withhold or delay its
consent to any other proposed Transfer; however, Landlord may
withhold its consent to any other proposed Transfer in its sole and
absolute discretion at any time Tenant is in Default hereunder
(unless the same would invalidate any remedy available to Landlord
as a result of such Default, in which case Landlord’s consent
shall not be unreasonably withheld regardless of whether or not
Tenant is in Default hereunder). It shall be reasonable under this
Lease and under any applicable Law for Landlord to withhold consent
to any proposed Transfer where one or more of the following apply,
without limitation as to other reasonable grounds for withholding
consent:

 

14.3.1. The Transferee is
of a character or reputation or engaged in a business that is not
consistent with the quality of the Building.

 

14.3.2. The Transferee
intends to use the Subject Space for purposes that are not
permitted under this Lease.

 

14.3.3. The Transferee is
either a governmental agency or instrumentality
thereof.

 

 

 

23

 

 

14.3.4. The Transfer will
result in more than a reasonable and safe number of occupants per
floor within the Subject Space.

 

14.3.5. The Transferee is
not a party of acceptable financial worth or financial stability in
light of the responsibilities involved under the Lease on the date
consent is requested, as determined by Landlord.

 

14.3.6. The Transfer would
cause a violation of another lease or any agreement to which
Landlord is a party, or would give an occupant of the Building a
right to cancel its lease.

 

14.3.7 The Transfer would
occur at a time when Landlord has similarly-sized space available
in the Building and the rent charged by Tenant to such Transferee
during the term of such Transfer, calculated using a present value
analysis, is less than the greater of (a) ninety-five percent (95%)
of the rent that would be quoted by Landlord at the time of such
Transfer for such similarly-sized space for a comparable term, or
(b) the then-current Rent due under this Lease, each calculated
using a present value analysis.

 

14.3.8. Either the
Transferee or an Affiliate of the Transferee (a) occupies space in
the Building at the time of the request for consent; (b) is
negotiating with Landlord to lease space in the Building at such
time; or (c) has negotiated with Landlord during the twelve
(12)-month period immediately preceding the Transfer
Notice.

 

14.4. 
Completion of Transfer  If Landlord
consents to any Transfer (and does not exercise any recapture
rights Landlord may have under this Lease), Tenant may within six
(6) months after Landlord’s consent, enter into the approved
Transfer, upon substantially the same terms and conditions as are
set forth in the Transfer Notice. If there are any material changes
in the terms and conditions from those specified in the Transfer
Notice (a) such that Landlord would initially have been entitled to
refuse its consent to such Transfer; or (b) that would cause the
proposed Transfer to be more favorable to the Transferee than the
terms set forth in the Transfer Notice, Tenant shall again submit
the Transfer to Landlord for its approval and other action under
this Article (including, without limitation, exercise any of
recapture rights Landlord may have under this Lease).

 

14.5. Transfer
Premium. If Landlord
consents to a Transfer, Tenant shall pay to Landlord fifty percent
(50%) of any Transfer Premium received by Tenant.
“Transfer Premium” shall mean (a) all rent,
additional rent or other consideration payable by such Transferee
in excess of the Rent payable by Tenant under this Lease on a per
rentable square foot basis; (b) all key money and bonus money
paid by Transferee; and (c) any payment in excess of fair
market value for services rendered by Tenant to Transferee. The
“Transfer Premium” shall (i) be reduced by all
out-of-pocket expenses incurred by Tenant in connection with the
Transfer, such as customary brokerage commissions and reasonable
attorneys’ fees; and (ii) shall not include any
compensation for the fair market value of Tenant’s Property
nor reasonable compensation for the sale of Tenant’s business
that is not attributable to the value of Tenant’s leasehold
interest hereunder. Tenant shall pay the Transfer Premium to
Landlord within five (5) days following receipt by Tenant. Tenant
shall furnish upon Landlord’s request a complete statement,
certified by an independent certified public accountant, or
Tenant’s chief financial officer, setting forth in detail the
computation of any Transfer Premium. Within one (1) year following
the date of the Transfer, Landlord shall have the right at all
reasonable times to audit the books, records and papers of Tenant
relating to any Transfer as necessary to confirm the calculation of
the Transfer Premium. If the Transfer Premium shall be found
understated, Tenant shall, within thirty (30) days after demand,
pay the deficiency, together with interest thereon at the Interest
Rate and Landlord’s costs of such audit. If the Transfer
Premium has been understated by more than ten percent (10%),
Landlord shall have the right to cancel this Lease upon thirty (30)
days’ notice to Tenant and Tenant shall indemnify Landlord
from and against any and all Claims associated with such
termination, including but not limited to any Claims by the
Transferee.

 

14.6. Recapture.
Notwithstanding anything to the contrary contained in this Article,
Landlord shall have the option, by giving notice to Tenant within
twenty (20) days after receipt of any Transfer Notice, to recapture
the Subject Space. Such recapture notice shall cancel and terminate
this Lease with respect to the Subject Space as of the effective
date of the proposed Transfer (or upon the demise of the Subject
Space separate from the Premises if the Subject Space being
recaptured is less than the entire Premises). In the event of a
recapture by Landlord, if this Lease shall be canceled with respect
to less than the entire Premises, (i) the Rent reserved herein
shall be prorated on the basis of the Rentable Area retained by
Tenant in proportion to the Rentable Area of the Premises, and this
Lease as so amended shall continue thereafter in full force and
effect, and (ii) Tenant shall reimburse Landlord for the costs
incurred by Landlord to separately demise the Subject Space from
the remainder of the Premises. Upon request of either party, the
parties shall execute written confirmation of the
foregoing.

 

 

24

 

 

14.7. Effect
of Transfer. If Landlord
consents to a Transfer, (a) no terms or conditions of this
Lease shall be deemed to have been waived or modified;
(b) such consent shall not be deemed consent to any further
Transfer; (c) no Transfer shall be valid, and no Transferee
shall take possession of the Premises, until an executed
counterpart of all documentation pertaining to the Transfer has
been delivered to Landlord; and (d) no Transfer shall relieve
Tenant or any Guarantor from primary liability under this Lease.
The acceptance of Rent by Landlord from any party shall not be
deemed to be a waiver of Landlord of any provision hereof. In the
event of Default by a Transferee in the performance of any of the
terms hereof, Landlord may proceed directly against Tenant without
the necessity of exhausting remedies against such Transferee.
Landlord may consent to subsequent assignments of the Lease or
sublettings or amendments or modifications to the Lease by
Transferees without notifying Tenant, and without obtaining its
consent thereto, and any such actions shall not relieve Tenant of
liability under this Lease and Tenant hereby consents to all or any
of the foregoing. Any Transfer for which Landlord’s consent
is required but not obtained pursuant hereto shall constitute a
Default under this Lease.

 

14.8. Tenant
Remedy for Landlord Refusal to Consent. Notwithstanding
any provision of this Lease or any applicable Laws to the contrary,
Landlord and Tenant hereby expressly agree that if a court of
competent jurisdiction determines that Landlord unreasonably
withheld consent to a proposed Transfer, then Tenant’s sole
and exclusive remedy for such breach by Landlord shall be limited
to termination of this Lease as of the date of such court
determination. Tenant hereby expressly waives the right to recover
monetary damages of any kind whatsoever and attorney’s fees
incurred on account of any such breach.

 

14.9. Desk
Sharing

 

14.10.Tenant shall have
the right to allow up to five percent (5%) of the Premises to be used by
persons with whom Tenant has a bonafide business relationship
(each, a “Permitted User”). Notwithstanding anything to
the contrary set forth in this Section 14.9, each Permitted User
shall be allowed such use, without Landlord’s consent, upon
at least three (3) days’ prior written notice to Landlord but
only if the following conditions are satisfied: (i) Landlord and
any Landlord Related Party shall not have litigated against any
such proposed Permitted User; (ii) the Permitted User shall not be
entitled, directly or indirectly, to diplomatic or sovereign
immunity and shall be subject to service of process in and subject
to the jurisdiction of, the courts of the State; (iii) there will
be no separate entrances or demising walls for any Permitted User;
(iv) the Permitted User shall operate in a manner consistent with
the character of the Building as a first-class office project and
in compliance with all applicable Laws, including zoning
ordinances, to which the Building is subject; (v) concurrent with
Tenant’s delivery of its notice of a Permitted User, Tenant
shall supply Landlord with a certificate of insurance from the
Permitted User evidencing that the Permitted User carries the
insurance required of Tenant under this Lease; and (vi) no such
occupancy by a Permitted User shall be deemed to be a tenancy or
subtenancy hereunder and any such occupancy shall be pursuant to a
license which shall be automatically revoked upon the expiration or
sooner termination of the Term of this Lease.

 

 

 

25

 

 

ARTICLE 15

DESTRUCTION OR
DAMAGE

 

15.1. Landlord
Termination Rights. If the Premises
or any portion of the Building or the Project is damaged by fire,
earthquake, terrorism, act of war, act of God, the elements or
other casualty, then Landlord may terminate this Lease upon notice
given to Tenant within sixty (60) days after the date of such
casualty, effective as of the date of the casualty if (a) in
Landlord’s opinion, repairs to the Premises cannot be
completed within ninety (90) days; (b) any other portion of
the Building or the Project is damaged to the extent that, in
Landlord’s opinion, repair thereof cannot be completed within
ninety (90) days; (c) the Premises or any portion of the
Building or the Project necessary for Tenant’s occupancy is
damaged during the final twelve (12) months of the Term, unless
Tenant shall exercise its next available renewal option (if
any) within ten (10) days following receipt of
Landlord’s termination notice and Landlord does not elect to
terminate this Lease pursuant to one of the other subsections
herein within ten (10) days of such exercise; (d) the
insurance proceeds available to Landlord are not sufficient to
complete repair or restoration; (e) Landlord’s lender
does not elect to make insurance proceeds available to Landlord for
repair and restoration; or (f) Tenant has vacated the Premises
or is in Default under this Lease.

 

15.2. Repairs.
If this Lease is not terminated as provided above, it shall
continue in full force and effect, and Landlord shall promptly and
diligently, subject to reasonable delays for insurance adjustment,
and subject to all other terms of this Article, restore the
Premises, the Common Areas and the portions of the Project serving
the Premises and Tenant shall assign to Landlord all insurance
proceeds payable to Tenant as to any Alterations; provided that if
the cost of the restoration of any Alterations by Landlord exceeds
the amount of Tenant’s insurance proceeds therefor, as
assigned by Tenant to Landlord, such excess shall be paid by Tenant
to Landlord prior to Landlord’s restoration thereof. Such
restoration shall be to substantially the same condition of such
items as prior to the casualty, except for modifications
(a) required by Law; (b) required by the holder of a
mortgage on the Building, or the lessor of a ground or underlying
lease with respect to the Property; or (c) to the Common Areas
reasonably deemed desirable by Landlord, and which are consistent
with the character of the Project. No such modifications shall
materially impair access to the Premises and any Common Areas
serving the Premises. Tenant shall be responsible, at its sole cost
and expense, for the repair, restoration, and replacement of
Tenant’s Property. Landlord shall not be liable for any loss
of business, inconvenience, or annoyance arising from any casualty
or any repair or restoration of any portion of the Premises, the
Building, or the Project as a result of any damage from any
casualty. All work by Tenant shall be subject to the terms and
conditions of Article 11.

 

15.3. Tenant’s
Termination Rights. If Landlord does
not elect to terminate this Lease pursuant to Landlord’s
termination right as provided above, and the repairs cannot be
completed within three hundred sixty five (365) days after being
commenced (the “Repair Period”) as determined by an
architect or contractor designated by Landlord, Tenant may elect,
no earlier than sixty (60) days after the date of the casualty and
not later than ninety (90) days after the date of such casualty, to
terminate this Lease by notice to Landlord, effective as of the
date specified in the notice, which date shall not be less than
thirty (30) days nor more than sixty (60) days after such notice.
In addition, in the event that the Premises or the Building is
destroyed or damaged to any substantial extent during the last
twelve (12) months of the Term, then Tenant shall have the option
to terminate this Lease by giving notice to Landlord within thirty
(30) days after such casualty, in which event this Lease shall
cease and terminate as of the date of such notice. Tenant shall
also have the right to terminate this Lease if Landlord does not
complete repairs within the Repair Period by thirty (30)
days’ notice to Landlord after the expiration of the Repair
Period; provided however, if Landlord completes repair within such
thirty (30) day period, such termination shall be nullified and
this Lease shall continue in full force and effect.

 

15.4. Apportionment
of Rent. Upon any
termination of this Lease pursuant to this Article, Tenant shall
pay the Rent, properly apportioned up to such date of termination,
and both parties hereto shall thereafter be freed and discharged of
all further obligations hereunder, except as provided for in
provisions of this Lease that by their terms survive the expiration
or earlier termination of this Lease.

 

 

 

26

 

 

15.5. Abatement.
The Rent shall abate on an equitable basis to the extent
Tenant’s use of the Premises is impaired, commencing with the
date of the casualty and continuing until completion of the repairs
required of Landlord; provided that if the damage is due to the
negligence or willful misconduct of any Tenant Related Party, Rent
shall only abate to the extent the same is covered by rent loss
insurance, if any, carried by Landlord.

 

15.6. Express
Agreement. This Lease shall
be considered an express agreement governing any case of damage to
or destruction of the Premises, the Building, or the Project by
fire or other casualty; and any present or future Law that purports
to govern the rights of Landlord and Tenant in such circumstances
in the absence of express agreement is hereby waived by the parties
and shall have no application.

 

ARTICLE 16

EMINENT
DOMAIN

 

16.1. Entire
Premises. If the whole of
the Building or the Premises is lawfully taken by condemnation or
in any other manner for any public or quasi-public purpose, this
Lease shall terminate as of the earlier of the date of the date
title vests or the date possession is given, and Rent shall be
prorated to such date.

 

16.2. Partial
Condemnation. If less than the
whole of the Building or the Premises is so taken, this Lease shall
be unaffected by such taking, except that (a) Tenant shall have the
right to terminate this Lease by notice to Landlord given within
ninety (90) days after the date of such taking if twenty-five
percent (25%) or more of the Premises is taken and the remaining
area of the Premises is not reasonably sufficient for Tenant to
continue operation of its business; and (b) Landlord shall have the
right to terminate this Lease by notice to Tenant given within
ninety (90) days after the date of such taking. If either Landlord
or Tenant so elects to terminate this Lease, this Lease shall
terminate on the thirtieth (30th) day after either such notice.
Rent shall be prorated to the date of such termination. If this
Lease continues in force upon such partial taking, the Base Rent
and Tenant’s Proportionate Share shall be equitably adjusted
according to the remaining Rentable Area of the Premises and the
Project.

 

16.3. Proceeds
of Award. In the event of
any taking, partial or whole, all of the proceeds of any award,
judgment, or settlement payable by the condemning authority shall
be the exclusive property of Landlord, whether awarded as
compensation for the damages to Landlord’s or Tenant’s
interest in the Premises and whether or not awarded as compensation
for diminution in value of the leasehold or to the fee of the
Premises, and Tenant hereby assigns to Landlord all of its right,
title, and interest in any award, judgment, or settlement from the
condemning authority. Tenant, however, shall have the right, to the
extent that Landlord’s award is not reduced or prejudiced, to
claim from the condemning authority (but not from Landlord) such
compensation as may be recoverable by Tenant in its own right for
relocation expenses and damage to Tenant’s
Property.

 

16.4. Repairs.
In the event of a partial taking of the Premises that does not
result in a termination of this Lease, Landlord shall restore the
remaining portion of the Premises as nearly as practicable to its
condition prior to the condemnation or taking. Tenant shall be
responsible at its sole cost and expense for the repair,
restoration, and replacement of Tenant’s
Property.

 

 

27

 

 

ARTICLE 17

INDEMNIFICATION,
WAIVER, RELEASE AND LIMITATION OF
LIABILITY

 

17.1. Tenant’s
Indemnity. Except for any
injury or damage to persons or property on the Premises that is
proximately caused by or results proximately from the gross
negligence, sole negligence or willful misconduct of Landlord,
Tenant will and does hereby indemnify, defend and hold harmless the
Landlord Related Parties against and from any and all Claims that
may be imposed upon, incurred by, or asserted against Landlord or
any of the Landlord Related Parties and arising, directly or
indirectly, out of or in connection with Tenant’s use,
occupancy or maintenance of the Premises, the Building or the
Project, including, without limitation, any of the following:
(a) any act in, on or about the Premises, the Building or the
Project or any part thereof by any Tenant Related Party;
(b) any injury or damage to any person or property (provided
that such provision shall not have the effect of indemnifying
Landlord for any injury, loss, damage, or liability arising from
any omission, fault, negligence, or other misconduct of the
Landlord on or about the Premises, Building or Project or any
elevators, stairways, hallways, or other appurtenances used in
connection therewith, and not within the exclusive control of
Tenant); (c) any failure on the part of Tenant to perform or
comply with any of the covenants, agreements, terms or conditions
contained in this Lease; and (d) the negligence or willful
misconduct of any Tenant Related Party. At Landlord’s
request, Tenant shall, at Tenant’s expense and by counsel
selected by Landlord, defend Landlord in any action or proceeding
arising from any such Claim and shall indemnify Landlord against
all costs, reasonable attorneys’ fees, expert witness fees,
and any other expenses incurred in such action or
proceeding.

 

17.2. Assumption
of Risk. Tenant hereby
assumes all risk of damage or injury to any person or property in,
on, or about the Premises from any cause other than the gross
negligence, sole negligence or willful misconduct of Landlord.
Tenant agrees that, unless expressly provided herein, no Landlord
Related Parties will be liable for any loss, injury, death, or
damage to persons or property resulting from any of the following,
regardless of whether the same is due to the active or passive act
of any Landlord Related Party: (a) theft; (b) Force
Majeure; (c) any accident or occurrence in the Premises or any
other portion of the Building or the Project caused by the Premises
or any other portion of the Building or the Project being or
becoming out of repair or by the obstruction, breakage or defect in
or failure of equipment, pipes, sprinklers, wiring, plumbing,
heating, ventilation and air-conditioning or lighting fixtures of
the Building or the Project or by broken glass or by the backing up
of drains, or by gas, water, steam, electricity or oil leaking,
escaping or flowing into or out of the Premises;
(d) construction, repair or alteration of any other premises
in the Building or the Premises, unless due solely to the gross
negligence, sole negligence or willful misconduct of Landlord;
(e) business interruption or loss of use of the Premises;
(f) any diminution or shutting off of light, air or view by
any structure erected on the Land or any land adjacent to the
Project, even if Landlord is the adjacent land owner; (g) mold
or indoor air quality; or (h) any acts or omissions of any
other tenant, occupant or visitor of the Building or the Project.
In no event shall Landlord be liable for indirect, consequential,
or punitive damages, including, without limitation, any damages
based on lost profits. None of the foregoing shall be considered a
constructive eviction of Tenant, nor shall the same entitle Tenant
to an abatement of Rent.

 

17.3. Limitation
of Landlord Liability. Neither Landlord
nor any Landlord Related Party shall have any personal liability
with respect to any of the provisions of the Lease, or the
Premises. If Landlord is in breach or default with respect to
Landlord’s obligations under the Lease, Tenant shall look
solely to the equity interest of Landlord in the Building
(including any insurance proceeds) for the satisfaction of
Tenant’s remedies or judgments. No other real, personal, or
mixed property of any Landlord Related Parties, wherever situated,
shall be subject to levy to satisfy such judgment. Upon any
Transfer of Landlord’s interest in this Lease or in the
Project, the transferring Landlord shall have no liability or
obligation for matters arising under this Lease from and after the
date of such Transfer.

 

 

 

28

 

 

ARTICLE 18

INSURANCE

 

18.1. Landlord
Required Coverage. Landlord shall
procure and maintain during the Term, (i) a policy or policies of
commercial property insurance covering the Project (excluding
portions of the Project Tenant is required to insure under Section
18.2.2), (ii) commercial general liability insurance, (iii)
business income/rental value insurance, and (iv) any other
insurance deemed appropriate by Landlord or its Mortgagee. Such
insurance shall be in such amounts, from such companies, and on
such terms and conditions as Landlord or its Mortgagee may deem
appropriate from time to time, so long as such amounts, terms and
conditions shall be generally consistent with the amounts, terms
and conditions carried by other institutional landlords of projects
similar to the Project in the Bethesda area. All insurance
maintained by Landlord shall be in addition to, and not in lieu of,
the insurance required to be maintained by Tenant hereunder.
Landlord shall cause its respective insurance policy(ies) to be
endorsed, if necessary, to waive subrogation.

 

18.2. Tenant
Required Coverage. Tenant shall
maintain the following coverages in the following
amounts.

 

18.2.1. Commercial General
Liability Insurance covering Tenant against any claims or suits
arising out of bodily injury, death, personal injury or property
damage arising out of Tenant's operations, assumed liabilities or
use of the Premises, for limits of liability not less than Two
Million and No/100 Dollars ($2,000,000.00) per occurrence and Five
Million and No/100 Dollars ($5,000,000.00) annual general aggregate
(these limits may be achieved by a combination of a primary policy
and a “follow form” excess or umbrella liability
policy). Such insurance shall include a waiver of subrogation
endorsement in favor of Landlord.

 

18.2.2. Commercial Property
Insurance covering (a) Tenant’s Property, and (b) any
improvements and Alterations made by Tenant or at Tenant’s
request. Such insurance shall include a waiver of subrogation
endorsement in favor of Landlord and shall be written on a
“Causes of Loss – Special Form” basis (or its
equivalent), for the full replacement cost (as reasonably approved
by Landlord) without deduction for depreciation, and shall include
coverage for theft, vandalism, malicious mischief and sprinkler
leakage. Such policy shall have a deductible not greater than Five
Thousand and No/100 Dollars ($5,000.00). The proceeds of such
insurance shall be used for the repair or replacement of the
property so insured. Upon termination of this Lease following a
casualty as set forth herein any proceeds under (a) shall be paid
to Tenant and any proceeds under (b) in excess of Tenant’s
unamortized cost associated therewith shall be paid by Tenant to
Landlord. Notwithstanding the foregoing, Landlord shall have the
option at any time, upon three (3) months’ notice to Tenant,
to procure property insurance covering leasehold improvements on
all the premises throughout the Building, and Tenant shall
thereafter pay Tenant’s Proportionate Share of the premium of
such policy as an element of Project Operating Costs.

 

18.2.3. Business Income and
Extra Expense insurance (or its equivalent) in such amounts as will
reimburse Tenant for direct or indirect loss of earnings
attributable to all perils commonly insured against by prudent
tenants or attributable to prevention of access to the Premises or
to the Building as a result of such perils, for a period of not
less than twelve (12) months. Such insurance shall include a waiver
of subrogation endorsement in favor of Landlord.

 

18.2.4.  Statutory
worker’s compensation (which policy shall include a waiver of
subrogation endorsement in favor of Landlord. Tenant shall provide
Landlord with a copy of such endorsement concurrent with providing
its evidence of insurance required under Section 18.4 below),
together with employer’s liability/employer’s indemnity
coverage at limits of:

 

$1,000,000 Each
Accident

$1,000,000 Each
Employee by Disease

$1,000,000 Policy
Limit by Disease

 

 

29

 

 

18.3. Form
of Policies. The insurance
required by Section 18.2.1 above shall (a) name Landlord,
Landlord’s property management agent, the Advisor, and at
Landlord’s request, any Mortgagee, each as an additional
insured by endorsement(s) reasonably acceptable to Landlord; (b)
cover, to the extent insurable, Tenant’s indemnity
obligations under this Lease; (c) be issued by an insurance company
having an A.M. Best rating of not less than A- IX or that is
otherwise reasonably acceptable to Landlord; (d) be primary, not
contributing with, and not in excess of, coverage that Landlord may
carry; and (e) contain a separation of insureds provision and no
insured vs. insured exclusion or limitation. Tenant agrees that it
shall (x) cause such policies to be endorsed to provide thirty (30)
days’ prior written notice by the insurer(s) to Landlord in
the event said insurance is cancelled (ten (10) days’ prior
written notice in the event of cancellation for non-payment of
premium), and (y) provide thirty (30) days’ prior written
notice to Landlord in the event said insurance shall be canceled,
non-renewed or coverage reduced.

 

18.4. Evidence
of Insurance. Tenant shall
deliver a copy of each paid-up policy or, at Landlord’s
option, a certificate of insurance, together with additional
insured and waiver of subrogation endorsements, all of which shall
be reasonably acceptable to Landlord, evidencing the existence and
amount of each insurance policy required hereunder on or before the
Commencement Date. Landlord may, at any time and from time to time,
inspect or copy any insurance policies that this Lease requires
Tenant to maintain. Tenant shall furnish Landlord with renewals,
certificates, or “binders” at least ten (10) days prior
to the expiration thereof. Tenant agrees that, if Tenant does not
obtain and maintain such insurance, Landlord may (but shall not be
required to) after five (5) Business Days’ notice to Tenant
during which time Tenant does not supply Landlord evidence of the
required insurance, at Landlord’s option, either (a) procure
said insurance on Tenant’s behalf and charge Tenant the
premiums therefor, payable upon demand, or (b) charge Tenant a
non-compliance fee equal to five percent (5%) of the then-current
monthly Base Rent for each month, or portion thereof, that Tenant
fails to provide such evidence of the required insurance. Tenant
shall have the right to provide the insurance required hereunder
pursuant to blanket policies obtained by Tenant, provided such
blanket policies afford coverage as required by this
Lease.

 

18.5. Additional
Insurance Obligations. Landlord may
require (a) that Tenant obtain additional types of insurance,
including but not limited to earthquake, sprinkler leakage by
earthquake, environmental and terrorism insurance to the extent
such coverages are either (i) standard for similar properties
in the same geographic area as the Property and are available at
commercially reasonable rates, or (ii) are otherwise
reasonably required by Landlord or the Mortgagee; and (b) from
time to time, but not more frequently than every three (3) years
during the Term, increases in the policy limits for all insurance
to be carried by Tenant as set forth herein, in order to reflect
standard limits for similar properties.

 

18.6. Independent
Obligations. Tenant
acknowledges and agrees that Tenant’s insurance obligations
under this Lease are independent of Tenant’s indemnity
obligations, liabilities and duties under this Lease.

 

18.7. Waiver
of Subrogation. Anything in this
Lease to the contrary notwithstanding (other than as provided in
Section 10.3 above), Landlord and Tenant each hereby waives any and
all rights of recovery, claim, action or cause of action against
the other for any loss or damage to any property of Landlord or
Tenant, arising from any cause that (a) would be insured against
under the terms of any property insurance or business interruption
insurance required to be carried hereunder; or (b) is insured
against under the terms of any property insurance or business
interruption insurance actually carried, regardless of whether the
same is required hereunder. The foregoing waiver shall apply
regardless of the cause or origin of such claim, including but not
limited to the negligence of a party, or such party’s agents,
officers, employees or contractors. The foregoing waiver shall not
apply if it would have the effect, but only to the extent of such
effect, of invalidating any insurance coverage of Landlord or
Tenant. The foregoing waiver shall also apply to any deductible
and/or self-insured retention, as if the same were a part of the
insurance recovery.

 

 

30

 

 

ARTICLE 19

DEFAULT

 

19.1. Tenant’s
Default. A
“Default” shall mean the occurrence of any one or more
of the following events:

 

19.1.1.
Tenant’s
failure to pay any Rent within five (5) days of when
due.

 

19.1.2.
    If any
representation or warranty made by Tenant or any Guarantor to
Landlord is false in any material respect when made.

 

19.1.3.   
Tenant fails to deliver any estoppel certificates or subordination
agreements within the periods set forth in this Lease.

 

19.1.4.   
The levy of a writ of attachment or execution on this Lease or on
any of Tenant’s property or that of any
Guarantor.

 

19.1.5.    
Tenant’s or any Guarantor’s general assignment for the
benefit of creditors or arrangement, composition, extension, or
adjustment with its creditors.

 

19.1.6.    
Tenant or any Guarantor becomes insolvent or bankrupt or admits in
writing its inability to pay its debts as they mature.

 

19.1.7.    
Proceedings for the appointment of a trustee, custodian or receiver
of Tenant or any Guarantor or for all or a part of Tenant’s
or such Guarantor’s property are filed by or against Tenant
or any Guarantor, and, if filed against Tenant or such Guarantor
involuntarily, are not dismissed within sixty (60) days of
filing.

 

19.1.8. Proceedings in
bankruptcy, or other proceedings for relief under any law for the
relief of debtors, are instituted by or against Tenant or any
Guarantor, and, if instituted against Tenant or such Guarantor
involuntarily, are not dismissed within sixty (60) days of
filing.

 

19.1.9.   
Tenant
makes an anticipatory breach of this Lease. “Anticipatory
breach” shall mean either (a) Tenant’s repudiation
of this Lease in writing; or (b) the combination of
(i) Tenant’s desertion or vacation of the Premises or
removal of all or a substantial amount of Tenant’s equipment,
furniture and fixtures from the Premises; and
(ii) Tenant’s failure to pay any Rent under this Lease
when due.

 

19.1.10.   
Tenant
fails to perform any other covenant, condition or agreement
contained in this Lease not covered by the preceding subsections,
where such failure continues for thirty (30) days after notice
thereof from Landlord to Tenant, or such additional period as is
reasonably necessary to effect cure, provided Tenant commences cure
within such thirty (30) day period and diligently pursues the same
to completion within ninety (90) days following Landlord’s
notice.

 

19.1.11.   
Tenant
shall repeatedly fail to pay Rent when due or any other charges
required to be paid, or shall repeatedly default in keeping,
observing or performing any other covenant, agreement, condition or
provision of this Lease, whether or not Tenant shall timely cure
any such payment or other default. For the purposes of this
subsection, the occurrence of similar defaults two (2) times during
any twelve (12) month period shall constitute a repeated
default.

 

Any
notice periods provided for under this Section shall run
concurrently with any statutory notice periods and any notice given
hereunder may be given simultaneously with or incorporated into any
such statutory notice.

 

 

31

 

 

19.2. Landlord’s
Default. Tenant shall
promptly notify Landlord of the need for any repairs or action with
respect to other matters that are Landlord’s obligation under
this Lease. If Landlord fails to perform any covenant, condition,
or agreement contained in this Lease within thirty (30) days after
receipt of notice from Tenant, or if such default cannot reasonably
be cured within thirty (30) days, and if Landlord fails to commence
to cure within such thirty (30) day period or to diligently
prosecute the same to completion, then subject to the other
limitations set forth elsewhere in this Lease, Landlord shall be
liable to Tenant for any damages sustained by Tenant as a result of
Landlord’s breach; provided that in no event shall
(a) Landlord be liable for indirect, consequential or punitive
damages, including without limitation, any damages based on lost
profits; or (b) Tenant have the right to terminate this Lease
on account of a Landlord default. Tenant shall not have the right
to withhold, reduce or offset any amount against any payments of
Rent or any other charges due and payable under this Lease unless
Tenant has obtained a final, non-appealable judgment against
Landlord for the amount due.

 

ARTICLE 20

LANDLORD REMEDIES
AND DAMAGES

 

20.1. Remedies.
In the event of a Default, then in addition to any other rights or
remedies Landlord may have at law or in equity, Landlord shall have
the right, at Landlord’s option, without further notice or
demand of any kind, to do any or all of the following without
prejudice to any other remedy that Landlord may have:

 

20.1.1. Terminate this
Lease and Tenant’s right to possession of the Premises by
giving notice to Tenant. Tenant shall immediately surrender the
Premises to Landlord, and if Tenant fails to do so, Landlord may
re-enter the Premises and take possession thereof and expel or
remove Tenant and any other party who may be occupying the
Premises, or any part, thereof, whereupon Tenant shall have no
further claim to the Premises or under this Lease.

 

20.1.2. Continue this Lease
in full force and effect, whether or not Tenant has vacated or
abandoned the Premises, and sue upon and collect any unpaid Rent or
other charges, that have or thereafter become due and
payable.

 

20.1.3.    
Continue this Lease
in effect, but terminate Tenant’s right to possession of the
Premises and re-enter the Premises and take possession thereof,
whereupon Tenant shall have no further claim to the Premises
without the same constituting an acceptance of
surrender.

 

20.1.4.     
In the
event of any re-entry or retaking of possession by Landlord,
Landlord shall have the right, but not the obligation, (a) to
expel or remove Tenant and any other party who may be occupying the
Premises, or any part thereof; and (b) to remove all or any
part of Tenant’s or any other occupant’s property on
the Premises and to place such property in storage at a public
warehouse at the expense and risk of Tenant.

 

Landlord may relet
the Premises without thereby avoiding or terminating this Lease (if
the same has not been previously terminated), and Tenant shall
remain liable for any and all Rent and other charges and expenses
hereunder. For the purpose of reletting, Landlord is authorized to
make such repairs or alterations to the Premises as may be
necessary in the sole discretion of Landlord for the purpose of
such reletting, and if a sufficient sum is not realized from such
reletting (after payment of all costs and expenses of such repairs,
alterations and the expense of such reletting (including, without
limitation, reasonable attorney and brokerage fees) and the
collection of rent accruing therefrom) each month to equal the
Rent, then Tenant shall pay such deficiency each month upon demand
therefor. Actions to collect such amounts may be brought from time
to time, on one or more occasions, without the necessity of
Landlord’s waiting until the expiration of the
Term.

 

20.1.5. Without any further
notice or demand, Landlord may enter upon the Premises, if
necessary, without being liable for prosecution or claim for
damages therefor, and do whatever Tenant is obligated to do under
the terms of the Lease. Tenant agrees to reimburse Landlord on
demand for any reasonable expenses that Landlord may incur in
effecting compliance with Tenant’s obligations under the
Lease. Tenant further agrees that Landlord shall not be liable for
any damages resulting to Tenant from such action, unless caused by
the gross negligence or willful misconduct of Landlord (but subject
to the other limitations on Landlord’s liability set forth in
this Lease). Notwithstanding anything herein to the contrary,
Landlord will have no obligation to cure any Default of
Tenant.

 

 

 

32

 

 

20.1.6. 
Landlord shall at
all times have the right, without prior demand or notice except as
required by Law, to seek any declaratory, injunctive or other
equitable relief, and specifically enforce this Lease, or restrain
or enjoin a violation or breach of any provision hereof, without
the necessity of proving the inadequacy of any legal remedy or
irreparable harm.

 

20.1.7. 
To the
extent permitted by applicable Law, Landlord shall have the right,
without notice to Tenant, to change or re-key all locks to
entrances to the Premises, and Landlord shall have no obligation to
give Tenant notice thereof or to provide Tenant with a key to the
Premises.

 

20.1.8.  
The
rights given to Landlord in this Article are cumulative and shall
be in addition and supplemental to all other rights or remedies
that Landlord may have under this Lease and under applicable Laws
or in equity.

 

20.2. 
Damages Should Landlord
elect to terminate this Lease or Tenant’s right to possession
under the provisions above, Landlord may at Landlord's option, in
addition to any other remedy or right given hereunder or at law or
in equity, recover the following damages from Tenant:

 

20.2.1. Past
Rent. The worth at the
time of the award of any unpaid Rent that had been earned at the
time of termination; plus

 

20.2.2. Rent
Prior to Award. The worth at the
time of the award of the unpaid Rent that would have been earned
after termination, until the time of award; plus

 

20.2.3. Rent
After Award. At
Landlord’s option, either (a) an amount equal to the Rent
that would have become due for the balance of the term, less the
amount of rent, if any, which Landlord receives during such period
from others to whom the Premises may be rented, which damages shall
be computed and payable in monthly installments, in advance, on the
first day of each calendar month following the award and continuing
until the date on which the term would have expired but for
Tenant's default or (b) the worth at the time of the award of the
amount by which the unpaid Rent for the balance of the term after
the award exceeds the amount of rental loss that Tenant proves
could have been reasonably avoided, if any; plus

 

20.2.4. Proximately
Caused Damages. Any other amount
necessary to compensate Landlord for all detriment proximately
caused by Tenant’s failure to perform its obligations under
this Lease or that in the ordinary course of things would be likely
to result therefrom, including, but not limited to, any costs or
expenses (including, without limitation, reasonable
attorneys’ fees), incurred by Landlord in (a) retaking
possession of the Premises; (b) maintaining the Premises after
Default; (c) preparing the Premises or any portion thereof for
reletting to a new tenant, including, without limitation, any
repairs or alterations, whether for the same or a different use;
(d) reletting the Premises, including but not limited to,
advertising expenses, brokers’ commissions and fees; and
(e) any special concessions made to obtain a new
tenant.

 

20.2.5. Other
Damages. At
Landlord’s election, such other amounts in addition to or in
lieu of the foregoing as may be permitted from time to time by
Law.

 

 

 

33

 

 

As used
in Sections 20.2.1
and 20.2.2, the
phrase “worth at the time of the award” shall be
computed by adding interest on all such sums from the date when
originally due at the Interest Rate. As used in Section 20.2.3, the phrase
“worth at the time of the award” shall be computed by
discounting the sum in question at the Federal Reserve rate
promulgated by the Federal Reserve office for the district in which
the Project is located, plus one percent (1%).

 

20.3. Rent
after Termination. Tenant
specifically acknowledges and agrees that Landlord shall have the
right to continue to collect Rent after any termination (whether
said termination occurs through eviction proceedings or as a result
of some other early termination pursuant to this Lease) for the
remainder of the Term, less any amounts collected by Landlord from
the reletting of the Premises, but in no event shall Tenant be
entitled to receive any excess of any such rents collected over the
Rent.

 

20.4. No
Termination. A termination of
this Lease by Landlord or the recovery of possession of the
Premises by Landlord or any voluntary or other surrender of this
Lease by Tenant or a mutual cancellation thereof, shall not work a
merger and shall at the option of Landlord, terminate all or any
existing franchises or concessions, licenses, permits, subleases,
subtenancies or the like between Tenant and any third party with
respect to the Premises, or may, at the option of Landlord, operate
as an assignment to Landlord of Tenant’s interest in same.
Following a Default, Landlord shall have the right to require any
subtenants to pay all sums due under their subleases directly to
Landlord.

 

20.5. Waiver
of Demand and Notice. All demands for
Rent and all other demands, notices and entries, whether provided
for under common law or otherwise, that are not expressly required
by the terms hereof, are hereby waived by Tenant. Notwithstanding
the foregoing waiver of notices, Landlord may elect to serve such
notices (including statutory notices) and combine such notices with
any notices required under the provisions of this Lease. Without
limiting the foregoing, the provisions of this Article shall
operate as a notice to quit, any other notice to quit or of
Landlord's intention to reenter the Premises or to terminate this
Lease being hereby expressly waived.

 

20.6. Waiver
of Redemption. Tenant hereby
waives, relinquishes and releases for itself and for all those
claiming under Tenant any right of occupancy of the Premises
following termination of this Lease, and any right to redeem or
reinstate this Lease by order or judgment of any court or by any
legal process or writ under present or future Laws, including,
without limitation, Maryland Real Property Section
8-401(e).

 

20.7. Deficiency.
If it is necessary for Landlord to bring suit in order to collect
any deficiency, Landlord shall have the right to allow such
deficiencies to accumulate and to bring an action on several or all
of the accrued deficiencies at one time. For the purposes of any
suit brought or based hereon, this Lease shall be construed to be a
divisible contract, to the end that successive actions may be
maintained on this Lease as successive periodic sums mature
hereunder. Any such suit shall not prejudice in any way the right
of Landlord to bring a similar action for any subsequent deficiency
or deficiencies.

 

20.8. Counterclaim.
Tenant hereby waives any right to plead any counterclaim, offset or
affirmative defense in any action or proceedings brought by
Landlord against Tenant for possession of the Premises or
otherwise, for the recovery of possession based upon the
non-payment of Rent or any other Default. The foregoing shall not,
however, be construed as a waiver of Tenant’s right to assert
any claim in a separate action brought by Tenant against Landlord.
In the event Tenant must, because of applicable court rules or
statutes, interpose any counterclaim or other claim against
Landlord in such proceedings, Landlord and Tenant agree that, in
addition to any other lawful remedy of Landlord, upon motion of
Landlord, such counterclaim or other claim asserted by Tenant shall
be severed from the proceedings instituted by Landlord (and, if
necessary, transferred to a court of different jurisdiction), and
the proceedings instituted by Landlord may proceed to final
judgment separately and apart from and without consolidation with
or reference to the status of any such counterclaim or any other
claim asserted by Tenant.

 

 

34

 

 

20.9. Mitigation
of Damages. Both Landlord and
Tenant shall each use commercially reasonable efforts to mitigate
any damages resulting from a default of the other party under this
Lease; provided that any failure by Landlord to mitigate damages in
accordance with the foregoing shall not give rise to any liability
of Landlord for breach of this Lease, but shall only serve to
reduce the recovery by Landlord by the amount of damages that
Tenant proves could reasonably have been avoided. Subject to the
foregoing, Landlord’s obligation to mitigate damages after a
Default shall only arise after Landlord has unconditionally
recovered possession of the Premises and shall be satisfied in full
if Landlord undertakes to lease the Premises to another tenant (a
“Substitute Tenant”) in accordance with the following
criteria:

 

20.9.1. Landlord shall have
no obligation to solicit or entertain negotiations with any
Substitute Tenant until Landlord obtains full and complete
possession of the Premises including, without limitation, the final
and unappealable legal right to relet the Premises free of any
claim of Tenant.

 

20.9.2.    
Landlord shall not
be obligated to offer the Premises to a Substitute Tenant when
other premises in the Project suitable for that tenant’s use
are (or soon will be) available.

 

20.9.3.    
Landlord shall not
be obligated to lease the Premises to a Substitute Tenant for a
rental amount less than the current fair market rental then
prevailing for similar uses in comparable buildings in the same
market area as the Project, nor shall Landlord be obligated to
enter into a new lease under other terms and conditions that are
unacceptable to Landlord under Landlord’s then current
leasing policies for comparable space in the Project.

 

20.9.4.   
Landlord shall not
be obligated to enter into a lease with any Substitute Tenant whose
use would:

 

1.
Disrupt the tenant mix or balance of the Project;

 

2.
Violate any restriction, covenant, or requirement contained in the
lease of another tenant of the Project or any other agreement to
which Landlord is a party;

 

3. Be
incompatible with the operation of the Project as a first-class
project.

 

20.9.5. Landlord shall not
be obligated to enter into a lease with any Substitute Tenant that
does not have, in Landlord’s reasonable opinion, sufficient
financial resources or operating experience to operate the Premises
in a first-class manner.

 

20.9.6.    
Landlord shall not
be required to expend any amount of money to alter, remodel, or
otherwise make the Premises suitable for use by a Substitute Tenant
unless:

 

1.           Tenant
pays any such sum to Landlord in advance of Landlord’s
execution of a lease with such Substitute Tenant (which payment
shall not be in lieu of any damages or other sums to which Landlord
may be entitled as a result of Tenant’s Default);
or

 

2.           Landlord
determines that any such expenditure is financially justified in
connection with entering into any such lease.

 

20.9.7. Upon compliance
with the above criteria regarding the releasing of the Premises
after a Default, Landlord shall be deemed to have fully satisfied
Landlord’s obligation to mitigate damages under this Lease
and under any Law, and Tenant waives and releases, to the fullest
extent legally permissible, any right to assert in any action by
Landlord to enforce the terms of this Lease, any defense,
counterclaim, or rights of setoff or recoupment respecting the
mitigation of damages by Landlord, unless and to the extent
Landlord maliciously or in bad faith fails to act in accordance
with the requirements of this Section. Until Landlord is able,
through such efforts, to relet the Premises, Tenant must pay to
Landlord, on or before the first day of each calendar month, the
monthly Rent and any other charges provided in this Lease. No such
reletting shall be construed as an election on the part of Landlord
to terminate this Lease unless Landlord gives Tenant a notice of
such intention. Notwithstanding any such reletting without
termination, Landlord may at any time thereafter elect to terminate
this Lease for such previous breach.

 

 

 

35

 

 

 ARTICLE
21

BANKRUPTCY

 

21.1. In the event a
petition is filed by or against Tenant under the Bankruptcy Code,
Tenant, as debtor and debtor in possession, and any trustee who may
be appointed agree to adequately protect Landlord as
follows:

 

21.1.1. to pay monthly in
advance on the first day of each month as reasonable compensation
for use and occupancy of the Premises an amount equal to all Rent
due pursuant to this Lease;

 

21.1.2. to perform each and
every obligation of Tenant under this Lease until such time as this
Lease is either rejected or assumed by order of a court of
competent jurisdiction;

 

21.1.3. to determine within
one hundred twenty (120) days after the filing of such petition
whether to assume or reject this Lease;

 

21.1.4. to give Landlord at
least thirty (30) days’ prior notice, unless a shorter period
is agreed to in writing by the parties, of any proceeding relating
to any assumption of this Lease;

 

21.1.5.  to give at least
thirty (30) days’ prior notice of any vacation or abandonment
of the Premises, any such vacation or abandonment to be deemed a
rejection of this Lease; and

 

21.1.6. to do all other
things to benefit Landlord otherwise required under the Bankruptcy
Code.

 

This
Lease shall be deemed rejected in the event of the failure to
comply with any of the above.

 

21.2. In order to provide
Landlord with the assurance contemplated by the Bankruptcy Code,
the following obligations must be fulfilled, in addition to any
other reasonable obligations that Landlord may require, before any
assumption of this Lease is effective: (a) all monetary
Defaults under this Lease must be cured within ten (10) days after
the date of assumption; (b) all other Defaults (other than
those arising solely on account of the bankruptcy filing) must
be cured within fifteen (15) days after the date of assumption;
(c) all actual monetary losses incurred by Landlord
(including, but not limited to, reasonable attorneys’
fees) must be paid to Landlord within ten (10) days after the
date of assumption; and (d) Landlord must receive within ten
(10) days after the date of assumption a security deposit in the
amount of six (6) months’ Base Rent and an advance prepayment
of three (3) months’ Base Rent.

 

21.3. In the event this
Lease is assumed in accordance with the requirements of the
Bankruptcy Code and this Lease, and is subsequently assigned, then,
in addition to any other reasonable obligations that Landlord may
require and in order to provide Landlord with the assurances
contemplated by the Bankruptcy Code, Landlord must be provided with
(a) a financial statement of the proposed assignee prepared in
accordance with generally accepted accounting principles
consistently applied, though on a cash basis, which reveals a net
worth in an amount sufficient, in Landlord’s reasonable
judgment, to assure the future performance by the proposed assignee
of Tenant’s obligations under this Lease; or (b) a written
guaranty by one or more guarantors with financial ability
sufficient to assure the future performance of Tenant’s
obligations under this Lease, such guaranty to be in form and
content satisfactory to Landlord and to cover the performance of
all of Tenant’s obligations under the Lease.

 

21.4. Neither Tenant nor
any trustee who may be appointed in the event of the filing of a
petition under the Bankruptcy Code shall conduct or permit the
conduct of any “fire,” “bankruptcy,”
“going out of business” or auction sale in or from the
Premises.

 

 

 

36

 

 

ARTICLE 22

LIEN FOR
RENT

 

In
consideration of the mutual benefits arising under this Lease,
Tenant hereby grants to Landlord a lien and security interest on
all property of Tenant now or hereafter placed in or upon the
Premises, and such property shall be and remain subject to such
lien and security interest of Landlord for payment of all Rent. The
provisions of this Article relating to such lien and security
interest shall constitute a security agreement under the Uniform
Commercial Code in force in the State (the “UCC”) so
that Landlord shall have and may enforce a security interest on all
property of Tenant now or hereafter placed in or on the Premises,
including, but not limited to, all fixtures, machinery, equipment,
furnishings and other articles of personal property now or
hereafter placed in or upon the Premises by Tenant. Landlord, as
secured party, shall be entitled to all of the rights and remedies
afforded a secured party under the UCC in addition to and
cumulative of Landlord’s liens and rights provided by law or
by the other terms and provisions of this Lease, and Landlord shall
have the right to file a Financing Statement reflecting such
lien.

 

ARTICLE 23

HOLDING
OVER

 

If,
after expiration of the Term, Tenant remains in possession of the
Premises, Landlord may, at its option, serve notice upon Tenant
that such hold over constitutes either: (a) a month-to-month
tenancy upon all the provisions of this Lease (except as to Term
and Base Rent); or (b) a tenancy at sufferance. If Landlord does
not give said notice, Tenant’s hold over shall create a
tenancy at sufferance, subjecting Tenant to all the covenants and
obligations of this Lease. In either event, the monthly
installments of Base Rent shall be increased to one hundred fifty
percent (150%) of the monthly installments of Base Rent in effect
at the expiration of the Term. If a month-to-month tenancy is
created, either party may terminate such tenancy by giving the
other party at least thirty (30) days advance notice of the date of
termination. Additionally, if Tenant shall hold over without the
consent of Landlord, then Tenant shall also protect, defend,
indemnify and hold Landlord harmless from all Claims resulting from
retention of possession by Tenant, including, without limiting the
generality of the foregoing, any Claims made by any succeeding
tenant founded upon such failure to surrender and any lost rents
and profits to Landlord resulting therefrom. The provisions of this
Article shall not constitute a waiver by Landlord of any right of
re-entry as otherwise available to Landlord, nor shall receipt of
any rent or any other act appearing to affirm the tenancy operate
as a waiver of the right to terminate this Lease for a breach by
Tenant hereof.

 

ARTICLE 24

SURRENDER OF
PREMISES

 

Upon
the expiration or earlier termination of this Lease, Tenant shall
peaceably surrender the Premises to Landlord broom-clean and in the
same condition as on the date Tenant took possession (a) except for
reasonable wear and tear, loss by fire or other casualty
and loss by condemnation, and (b) with all removal,
restoration and/or repairs required pursuant to Section 11.3 above
and this Article 24 completed. Tenant’s Property shall be and
shall remain the property of Tenant and may be removed by Tenant at
any time during the Term; provided that, if any of Tenant’s
Property is removed, Tenant shall promptly repair any damage to the
Premises or to the Building resulting from such removal. If Tenant
abandons or surrenders the Premises or is dispossessed by process
of law or otherwise, any of Tenant’s Property left on the
Premises shall be deemed abandoned, and, at Landlord’s
option, title shall pass to Landlord under this Lease as by a bill
of sale. If Landlord elects to remove all or any part of such
Tenant’s Property, the reasonable cost of removal, storage
and disposal of Tenant’s Property, including, without
limitation, repairing any damage to the Premises or Building caused
by such removal, shall be paid by Tenant. On the Expiration Date,
Tenant shall surrender all keys, parking cards and other means of
entry to the Premises, the Building and the Project, and shall
inform Landlord of the combinations and access codes for any locks
and safes located in the Premises. It is specifically agreed that
any and all telephonic, coaxial, ethernet, or other computer, word
processing, facsimile, or electronic wiring (“Telecom
Wiring”) and any other components of Tenant’s
Telecommunications System shall be removed at Tenant’s cost
at the expiration of the Term, unless Landlord has specifically
requested in writing that the Telecom Wiring shall remain,
whereupon the Telecom Wiring shall be surrendered with the Premises
as Landlord’s property.

 

 

 

37

 

 

ARTICLE 25

BROKERAGE
FEES

 

Tenant
warrants and represents that it has not dealt with any real estate
broker or agent in connection with this Lease or its negotiation
except as set forth on the Lease Summary. Tenant shall indemnify,
defend and hold Landlord harmless from any Claims for any
compensation, commission, or fees claimed by any other real estate
broker or agent in connection with this Lease (including but not
limited to any expansions of the Premises and renewals) or its
negotiation.

 

ARTICLE 26

NOTICES

 

Any
notice, demand, request, consent, covenant, approval or other
communication to be given by one party to the other must be in
writing and (except for statements and invoices to be given in the
ordinary course hereunder, which may be sent by regular U.S.
Mail) (a) delivered personally; (b) mailed by
certified United States mail, postage prepaid, return receipt
requested (except for statements and invoices to be given in the
ordinary course hereunder, which may be sent by regular U.S. Mail);
(c) sent by nationally recognized overnight courier; or
(d) sent by telecopy and confirmed by one of the other methods
set forth herein. The effective date of notice shall be
(i) for any notice delivered in person, the date of delivery;
(ii) for any notice by U.S. mail, three (3) days after the
date of certification thereof; (iii) for any notice by
overnight courier, the next Business Day after deposit with the
courier; and (iv) for any notice by telecopy, the date of
confirmation of receipt, if before 5:00 p.m. at the location
delivered, or the next day if after 5:00 p.m. All notices shall be
delivered or addressed to the parties at their respective addresses
set forth on the Lease Summary. Either party may change the address
at which it desires to receive notice upon giving notice of such
request to the other party in the manner provided
herein.

 

ARTICLE 27

RELOCATION OF
PREMISES

 

If the
Premises contain less than 10,000 square feet, Landlord shall have
the right to relocate the Premises to another part of the Project
in accordance with the following: (a) Landlord shall give Tenant at
least thirty (30) days’ notice of Landlord’s intention
to relocate the Premises; (b) the new premises shall be
substantially the same in size, dimensions, configuration, and
decor as the Premises and, if the relocation occurs after the
Commencement Date, shall be placed in that condition by Landlord at
its cost; (c) as nearly as practicable, the physical relocation of
the Premises shall take place on a weekend and shall be completed
before the following Monday and if the physical relocation has not
been completed in that time, Rent shall abate from the time the
physical relocation commences to the time it is completed, but not
to exceed three (3) Business Days from the time that Landlord makes
the new premises available to Tenant with all work to be performed
by Landlord thereon substantially complete; (d) upon completion of
such relocation, the new premises shall become the
“Premises” under this Lease; (e) all reasonable out of
pocket costs incurred by Tenant as a result of the relocation shall
be paid by Landlord; (f) if the new premises are smaller than the
Premises as they existed before the relocation, the Base Rent and
Tenant’s Proportionate Share shall be reduced
proportionately; and (g) the parties hereto shall immediately
execute an amendment to this Lease setting forth the relocation of
the Premises and the reduction of the Base Rent and Tenant’s
Proportionate Share, if any. Tenant hereby waives any claim against
Landlord for loss of business on account of any
relocation.

 

ARTICLE 28

SIGNAGE

 

28.1. Tenant shall be
entitled, at its sole cost and expense, to identification signage
outside of the Premises on the floor on which the Premises are
located. The location, quality, design, style, lighting and size of
such signage shall be consistent with the Landlord’s Building
standard signage program and shall be subject to Landlord’s
prior written approval.

 

28.2. Landlord shall pay
all costs of fabrication and installation of one (1) line on the
Building directory to display Tenant’s name and location in
the Building, which shall be consistent with the Landlord’s
Building standard signage program and shall be subject to
Landlord’s prior written approval. Any changes to the signage
initially provided by Landlord shall be at Tenant’s
expense.

 

 

 

38

 

 

28.3. No other signage
shall be permitted without the prior consent of Landlord, which
consent may be withheld in Landlord’s sole discretion. If
Landlord grants such consent, the signage will be at Tenant’s
expense. Tenant shall not affix, paint, erect, or inscribe any
sign, projection, awning, signal, or advertisement of any kind to
any part of the Premises, the Building or the Project, including,
without limitation, the inside or outside of windows or doors,
without the consent of Landlord, which consent may be withheld in
Landlord’s sole discretion. Landlord shall have the right to
remove any signs or other matter installed without Landlord’s
permission without being liable to Tenant by reason of such removal
and to charge the reasonable cost of removal to Tenant, payable
within ten (10) days of written demand by Landlord.

 

28.4. Any damage to any
portion of the Project upon installation, maintenance, or removal
of Tenant signage shall be Tenant’s sole responsibility. Upon
removal of Tenant’s signage, the area affected thereby shall
be repaired and restored pursuant to Landlord’s
specifications to a condition acceptable to Landlord, at
Tenant’s sole expense. Upon the expiration or earlier
termination of this Lease, Tenant will remove all of its
signage.

 

ARTICLE 29

LENDER
PROVISIONS

 

29.1. Subordination.
This Lease is subject and subordinate to all present and future
ground or underlying leases of the Property and to the lien,
operation and effect of any mortgages, deeds to secure debt or
trust deeds, now or hereafter in force against the Property or the
Building, if any, and to all renewals, extensions, modifications,
consolidations and replacements thereof (collectively,
“Mortgages”), and to all advances made or hereafter to
be made upon the security of such Mortgages. In the event any
proceedings are brought for the foreclosure of any mortgage, deed
to secure debt or trust deed, or if any ground or underlying lease
is terminated, Tenant shall attorn, without any deductions or
set-offs whatsoever, to the purchaser upon any such foreclosure
sale, or to the lessor of such ground or underlying lease, as the
case may be (the “Purchaser”), and recognize the
Purchaser as the lessor under this Lease, which attornment shall be
effective as of the date that the Purchaser acquires title to the
Property; however, the Purchaser shall have the right to accept or
reject such attornment upon written notice to Tenant and in no
event shall such attornment be negated by a foreclosure. In no
event shall Tenant have a right of offset against amounts due any
Purchaser on account of any defaults by Landlord under this Lease
that pre-date the time the Purchaser becomes the lessor hereunder,
nor shall any Purchaser be liable for any such defaults by
Landlord. Tenant shall, within ten (10) Business Days of request by
Landlord or the Purchaser (as applicable), execute such further
instruments or assurances as Landlord may reasonably deem necessary
to evidence or confirm the subordination or superiority of this
Lease to any Mortgages or Tenant’s attornment to the
Purchaser (as applicable). Tenant waives the provisions of any
current or future statute, rule or law that may give or purport to
give Tenant any right or election to terminate or otherwise
adversely affect this Lease and the obligations of Tenant hereunder
in the event of any foreclosure proceeding or sale. Notwithstanding
the provisions hereof, should any Mortgagee require that this Lease
be prior rather than subordinate to its Mortgage, or require that
Tenant attorn to any Purchaser, then in such event, this Lease
shall become prior and superior to such Mortgage, or Tenant shall
so attorn, upon notice to that effect to Tenant from such
Mortgagee. The aforesaid superiority of this Lease to any Mortgage
shall be self-operative upon the giving of such notice and no
further documentation other than such notice shall be required to
effectuate such superiority or attornment. In the event Landlord or
such Mortgagee desires confirmation of such superiority or
attornment, Tenant shall, promptly upon request therefor by
Landlord or such Mortgagee, and without charge therefor, execute a
document acknowledging such priority or attornment obligation to
the Mortgagee as Landlord in the event of foreclosure or deed in
lieu thereof or termination of a ground lease.

 

29.2. Estoppel
Certificates. Within ten (10)
days after written request from Landlord, Tenant shall execute and
deliver to Landlord, or Landlord’s designee, a written
statement certifying (a) that this Lease is unmodified and in full
force and effect or is in full force and effect as modified and
stating the modifications; (b) the amount of Base Rent and the date
to which Base Rent and Additional Rent have been paid in advance;
(c) the amount of any security deposit with Landlord; (d) that
Landlord is not in default hereunder or, if Landlord is claimed to
be in default, stating the nature of any claimed default; and (e)
such other matters as may be requested. Landlord and, any
purchaser, assignee or Mortgagee may rely upon any such statement.
Tenant’s failure to execute and deliver such statement within
the time required shall be conclusive against Tenant (1) that this
Lease is in full force and effect and has not been modified except
as represented by Landlord; (2) that there are no uncured defaults
in Landlord’s performance and that Tenant has no right of
offset, counterclaim, or deduction against Rent; (3) not more than
one (1) month’s Rent has been paid in advance; and (4) as to
the truth and accuracy of any other matters set forth in the
statement as submitted to Tenant.

 

 

 

39

 

 

29.3. Notice
and Cure Rights. Tenant agrees to
notify any Mortgagee whose address has been furnished to Tenant, of
any notice of default served by Tenant on Landlord. If Landlord
fails to cure such default within the time provided for in this
Lease, such Mortgagee shall have an additional thirty (30) days to
cure such default; provided that, if such default cannot reasonably
be cured within that thirty (30) day period, then such Mortgagee
shall have such additional time to cure the default as is
reasonably necessary under the circumstances.

 

29.4. Changes
Requested by Mortgagee. Tenant shall not
unreasonably withhold its consent to changes or amendments to this
Lease requested by a Mortgagee, so long as such changes do not
alter the basic business terms of this Lease or otherwise
materially diminish any rights or materially increase any
obligations of Tenant.

 

29.5. Mortgagee
Approval. Notwithstanding
anything to the contrary contained in this Lease, to the extent the
consent of any Mortgagee is required under the applicable Mortgage
in order for Landlord to enter into this Lease, Landlord may
terminate this Lease by written notice to Tenant if such consent is
not obtained (in which event this Lease shall be of no force or
effect).

 

ARTICLE 30

MISCELLANEOUS

 

30.1. Parking.
Tenant shall be permitted to park automobiles as set forth in
Exhibit H. In addition to the provisions of Exhibit H, Tenant shall
comply with all parking rules and regulations established by
Landlord for the Building, as the same may be revised from time to
time.

 

30.2. Quiet
Enjoyment. Tenant, upon
paying the Rent and performing all of its obligations under this
Lease, shall peaceably and quietly enjoy the Premises, subject to
the terms of this Lease and to any mortgage, deed of trust, lease,
or other agreement to which this Lease may be
subordinated.

 

30.3. No
Air Rights. This Lease does
not grant Tenant any rights to any view or to light or air over any
property, whether belonging to Landlord or any other person. If at
any time any windows of the Premises are temporarily darkened or
the light or view therefrom is obstructed by reason of any repairs,
improvements, maintenance or cleaning in or about the Building, the
same shall be without liability to Landlord and without any
reduction or diminution of Tenant’s obligations under this
Lease.

 

30.4. Force
Majeure. Any prevention,
delay, or stoppage of work to be performed by Landlord or Tenant
that is due to Force Majeure shall excuse performance of the work
by that party for a period equal to the duration of that
prevention, delay, or stoppage. Nothing in this Section shall
excuse or delay Tenant’s obligation to pay Rent or other
charges under this Lease.

 

 

 

40

 

 

30.5. Accord
and Satisfaction; Allocation of Payment. No payment by
Tenant or receipt by Landlord of a lesser amount than the Rent
provided for in this Lease shall be deemed to be other than on
account of the earliest due Rent; nor shall any endorsement or
statement on any check or letter accompanying any check or payment
as Rent be deemed an accord and satisfaction. Landlord may accept
such check or payment without prejudice to Landlord’s right
to recover the balance of the Rent or pursue any other remedy
provided for in this Lease. In connection with the foregoing,
Landlord shall have the absolute right in its sole discretion to
apply any payment received from Tenant to any account or other
payment of Tenant then not current and due or
delinquent.

 

30.6. Attorneys’
and Other Fees. Should either
party institute any action or proceeding to enforce or interpret
this Lease or any provision hereof, for damages by reason of any
alleged breach of this Lease or of any provision hereof, or for a
declaration of rights hereunder, the prevailing party in any such
action or proceeding shall be awarded from the other party all
costs and expenses, including, without limitation, attorneys’
and other fees, reasonably incurred in good faith by the prevailing
party in connection with such action or proceeding. The term
“attorneys’ and other fees” shall mean and
include reasonable attorneys’ fees, accountants fees, expert
witness fees and any and all consultants and other similar fees
incurred in connection with the action or proceeding and
preparations therefor. The term “action or proceeding”
shall mean and include actions, proceedings, suits, arbitrations,
appeals and other similar proceedings.

 

30.7. Construction.
Headings at the beginning of each Article, Section and subsection
are solely for the convenience of the parties only and in no way
define, limit, or enlarge the scope or meaning of this Lease.
Except as otherwise provided in this Lease, all exhibits referred
to herein are attached hereto and are incorporated herein by this
reference. This Lease shall not be construed as if either Landlord
or Tenant had prepared it, but rather as if both Landlord and
Tenant had prepared it. Any deletion of language from this Lease
prior to its execution by Landlord and Tenant shall not be
construed to raise any presumption, canon of construction or
implication, including, without limitation, any implication that
the parties intended thereby to state the converse of the deleted
language.

 

30.8. Confidentiality.
Tenant acknowledges that the content of this Lease and any related
documents are confidential information. Tenant shall keep such
confidential information strictly confidential and shall not
disclose such confidential information to any person or entity
other than Tenant’s financial, legal, and space planning
consultants or as required by Law. In addition to any other
remedies to which Landlord may be entitled if Tenant breaches the
foregoing covenant, Landlord shall have the right to increase the
Rent to then current market rent for the Building.

 

30.9. Governing
Law. This Lease shall
be governed by, interpreted under, and construed and enforced in
accordance with the Laws of the State applicable to agreements made
and to be performed wholly within the State.

 

30.10. Consent.
Unless otherwise expressly set forth herein, all consents and
decisions required or permitted of Landlord hereunder shall be
granted, withheld and made in Landlord’s reasonable
discretion. Except for consent to a Transfer, which shall be
governed by the provisions of Article 14 above, all consents and
approvals required from Landlord hereunder or any request by Tenant
which causes Landlord to actually incur attorneys’ and/or
consultants’ fees shall be subject to the requirement that
Landlord be reimbursed within fifteen (15) days of Landlord’s
written demand for attorneys’ and consultants’ fees and
costs incurred in connection therewith. Except for consent to a
Transfer, which shall be governed by Article 14 above, Tenant shall
have no claim and hereby waives the right to any claim against
Landlord for money damages by reason of any refusal, withholding,
or delaying by Landlord of any consent, approval, statement, or
satisfaction that Landlord has agreed shall be subject to a
standard of reasonableness. In such event, Tenant’s only
remedy therefor shall be an action for specific performance,
injunction, or declaratory judgment to enforce any right to such
consent, approval, statement, or satisfaction.

 

 

 

41

 

 

30.11. Authority.
Tenant shall, at Landlord’s request, deliver a certified copy
of a resolution of its board of directors, if Tenant is a
corporation, or other satisfactory documentation, if Tenant is
another type of entity, authorizing execution of this
Lease.

 

30.12. Duplicate
Originals; Counterparts; Fax/Email Signatures. This Lease may be
executed in any number of duplicate originals, all of which shall
be of equal legal force and effect. Additionally, this Lease may be
executed in counterparts, but shall become effective only after
each party has executed a counterpart hereof; all said
counterparts, when taken together, shall constitute the entire
single agreement between the parties. This Lease may be executed by
a party’s signature transmitted by facsimile
(“fax”) or email, and copies of this Lease executed and
delivered by means of faxed or emailed copies of signatures shall
have the same force and effect as copies hereof executed and
delivered with original wet signatures. All parties hereto may rely
upon faxed or emailed signatures as if such signatures were
original wet signatures. Any party executing and delivering this
Lease by fax or email shall promptly thereafter deliver a
counterpart signature page of this Lease containing said
party’s original signature. All parties hereto agree that a
faxed or emailed signature page may be introduced into evidence in
any proceeding arising out of or related to this Lease as if it
were an original wet signature page.

 

30.13. Offer.
The submission and negotiation of this Lease shall not be deemed an
offer to enter the same by Landlord but the solicitation of such an
offer by Tenant. Tenant agrees that its execution of this Lease
constitutes a firm offer to enter the same which may not be
withdrawn for a period of thirty (30) days after delivery to
Landlord (or such other period as may be expressly provided in any
other agreement signed by the parties). During such period and in
reliance on the foregoing, Landlord may, at Landlord’s
option, proceed with any plans, specifications, alterations, or
improvements, and permit Tenant to enter the Premises; but such
acts shall not be deemed an acceptance of Tenant’s offer to
enter this Lease, and such acceptance shall be evidenced only by
Landlord’s signing and delivering this Lease to
Tenant.

 

30.14. Further
Assurances. Landlord and
Tenant each agree to execute any and all other documents and to
take any further actions reasonably necessary to consummate the
transactions contemplated hereby.

 

30.15. Financial
Statements. In order to
induce Landlord to enter into this Lease, Tenant agrees that it
shall promptly furnish Landlord, from time to time, upon
Landlord’s written request (including in connection with
Tenant’s exercise of any Renewal Option granted under this
Lease), with financial statements reflecting Tenant’s current
financial condition. Tenant represents and warrants that all
financial statements, records, and information furnished by Tenant
to Landlord in connection with this Lease are true, correct, and
complete in all material respects.

 

30.16. Recording.
Tenant shall not record this Lease without the prior consent of
Landlord, which consent may be withheld in Landlord’s sole
discretion.

 

30.17. Right
to Lease. Landlord reserves
the absolute right to create such other tenancies in the Building
as Landlord shall determine to best promote the interests of the
Building and the Project. Tenant does not rely on the fact, nor
does Landlord represent, that any specific tenant or type or number
of tenants shall, during the Term, occupy any space in the Building
or the Project.

 

 

42

 

 

30.18. Severability.
In the event any portion of this Lease shall be declared by any
court of competent jurisdiction to be invalid, illegal or
unenforceable, such portion shall be deemed severed from this
Lease, and the remaining parts hereof shall remain in full force
and effect, as fully as though such invalid, illegal or
unenforceable portion had never been part of this
Lease.

 

30.19. Survival.
All indemnity and other unsatisfied obligations set forth in this
Lease shall survive the termination or expiration
hereof.

 

30.20. WAIVER
OF TRIAL BY JURY. TO THE EXTENT
PERMITTED BY APPLICABLE LAW, THE PARTIES HEREBY IRREVOCABLY WAIVE
ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING
OUT OF OR RELATING TO THIS LEASE, OR THE TRANSACTIONS OR MATTERS
RELATED HERETO OR CONTEMPLATED HEREBY. THE PARTIES FURTHER HEREBY
WAIVE THE RIGHT TO CONSOLIDATE ANY ACTION IN WHICH A JURY HAS BEEN
WAIVED WITH ANY OTHER ACTION IN WHICH A JURY TRIAL HAS NOT BEEN
WAIVED.

 

30.21. Successors
and Assigns. Subject to the
terms and conditions of Article 14 of this Lease, this Lease shall
apply to and bind the heirs, personal representatives, and
permitted successors and assigns of the parties.

 

30.22. Integration
of Other Agreements; Amendments. This Lease sets
forth the entire agreement and understanding of the parties with
respect to the matters set forth herein and supersedes all previous
written or oral understandings, agreements, contracts,
correspondence and documentation with respect thereto. Any oral
representations or modifications concerning this Lease shall be of
no force or effect. No provisions of this Lease may be amended or
added to except by an agreement in writing signed by the parties or
their respective successors in interest.

 

30.23. TIME
OF THE ESSENCE. TIME IS OF THE
ESSENCE OF THIS LEASE AND EACH AND EVERY TERM AND PROVISION
HEREOF.

 

30.24. Waiver.
The waiver by a party of any breach of any term, covenant, or
condition of this Lease shall not be deemed a waiver of such term,
covenant, or condition or of any subsequent breach of the same or
any other term, covenant, or condition. No delay or omission in the
exercise of any right or remedy of a party shall impair such right
or remedy or be construed as a waiver of any default of the other
party. Consent to or approval of any act by a party requiring
consent or approval of the other party shall not be deemed to waive
or render unnecessary such consent to or approval of any subsequent
act. Any waiver must be in writing and shall not be a waiver of any
other matter concerning the same or any other provision of this
Lease.

 

30.25. No
Surrender. No act or conduct
of Landlord, including, without limitation, the acceptance of keys
to the Premises, shall constitute an acceptance of the surrender of
the Premises by Tenant before the expiration of the Term. Only a
written notice from Landlord to Tenant shall constitute acceptance
of the surrender of the Premises and accomplish a termination of
the Lease.

 

 

 

43

 

 

30.26. Number
and Gender. As used in this
Lease, the neuter includes masculine and feminine, the singular
includes the plural and use of the word “including”
shall mean “including without limitation.”

 

30.27. Days.
The term “days,” as used herein, shall mean actual days
occurring, including Saturdays, Sundays and Holidays.

 

30.28. Joint
and Several Liability. If Tenant
consists of two (2) or more parties, each of such parties shall be
liable for Tenant’s obligations under this Lease, and all
documents executed in connection herewith, and the liability of
such parties shall be joint and several. Additionally, the act or
signature of, or notice from or to, any one or more of such parties
with respect to this Lease shall be binding upon each and all of
the parties executing this Lease as Tenant with the same force and
effect as if each and all of them had so acted or signed, or given
or received such notice and, in the event more than one (1) entity
comprising Tenant so acts, signs or gives or receives such notice,
Landlord shall be entitled to rely on the first such act,
signature, or giving or receiving of notice and any subsequent act,
signature or giving or receiving of notice by any additional Tenant
entity(ies) shall be null and void.

 

30.29. No
Third Party Beneficiaries. Except as
otherwise provided herein, no person or entity shall be deemed to
be a third party beneficiary hereof, including but not limited to
any brokers, and nothing in this Lease (either expressed or
implied) is intended to confer upon any person or entity, other
than Landlord and Tenant (and their respective nominees, successors
and assigns), any rights, remedies, obligations or liabilities
under or by reason of this Lease.

 

30.30. No
Other Inducements. It is expressly
warranted by each of the undersigned parties that no promise or
inducement has been offered except as herein set forth and that
this Lease is executed without reliance upon any statement or
representation of any person or party or its representatives
concerning the nature and extent of damages, costs and/or legal
liability therefor.

 

30.31. Independent
Covenants. This Lease shall
be construed as though the covenants herein between Landlord and
Tenant are independent and not dependent. Tenant hereby expressly
waives the benefit of any Laws to the contrary and agrees that if
Landlord fails to perform any of its obligations set forth herein,
Tenant shall not be entitled to make any repairs or perform any
acts hereunder at Landlord’s expense or to any setoff of
Rent.

 

30.32. No
Discrimination. Tenant covenants
by and for itself, its heirs, executors, administrators and
assigns, and all persons claiming under or through Tenant, and this
Lease is made and accepted upon and subject to the condition that
there shall be no discrimination against or segregation of any
person or group of persons, on account of race, color, creed, sex,
religion, marital status, ancestry or national origin or any other
classification protected under applicable federal, state or local
Laws in the leasing, subleasing, transferring, use, or enjoyment of
the Premises, nor shall Tenant itself, or any person claiming under
or through Tenant, establish or permit such practice or practices
of discrimination or segregation with reference to the selection,
location, number, use or occupancy, of tenants, lessees,
sublessees, subtenants or vendees in the Premises.

 

 

 

44

 

 

30.33. OFAC
Compliance.

 

30.33.1. As used herein
“Blocked Party” shall mean any party or nation that (a)
is listed on the Specially Designated Nationals and Blocked Persons
List maintained by the Office of Foreign Asset Control, Department
of the U.S. Treasury (“OFAC”) pursuant to Executive
Order No. 13224, 66 Fed. Reg. 49079 (Sept. 25, 2001) or other
similar requirements contained in the rules and regulations of OFAC
(the “Order”) or in any enabling legislation or other
Executive Orders in respect thereof (the Order and such other
rules, regulations, legislation, or orders are collectively called
the “Orders”) or on any other list of terrorists or
terrorist organizations maintained pursuant to any of the rules and
regulations of OFAC or pursuant to any other applicable Orders
(such lists are collectively referred to as the
“Lists”); or (b) has been determined by competent
authority to be subject to the prohibitions contained in the
Orders.

 

30.33.2. As a material
inducement for Landlord entering into this Lease, Tenant warrants
and represents that none of Tenant, any Affiliate of Tenant, any
partner, member or stockholder in Tenant or any Affiliate of
Tenant, or any beneficial owner of Tenant, any Affiliate of Tenant
or any such partner, member or stockholder of Tenant (collectively,
a “Tenant Owner”): (a) is a Blocked Party; (b) is owned
or controlled by, or is acting, directly or indirectly, for or on
behalf of, any Blocked Party; or (c) has instigated, negotiated,
facilitated, executed or otherwise engaged in this Lease, directly
or indirectly, on behalf of any Blocked Party. Tenant shall
immediately notify Landlord if any of the foregoing warranties and
representations becomes untrue during the Term.

 

30.33.3.  Tenant shall not:
(a) transfer or permit the transfer of any interest in Tenant or
any Tenant Owner to any Blocked Party; or (b) make a Transfer to
any Blocked Party or party who is engaged in illegal
activities.

 

30.33.4. 
If at
any time during the Term (a) Tenant or any Tenant Owner becomes a
Blocked Party or is convicted, pleads nolo contendere, or is
indicted, arraigned, or custodially detained on charges involving
money laundering or predicate crimes to money laundering; (b) any
of the representations or warranties set forth in this Section
become untrue; or (c) Tenant breaches any of the covenants set
forth in this Section, the same shall constitute a Default. In
addition to any other remedies to which Landlord may be entitled on
account of such Default, Landlord may immediately terminate this
Lease and refuse to pay any Allowance or other disbursements due to
Tenant under this Lease.

 

30.34. ERISA.
Tenant has been informed that one or more pension plans have an
interest in the Project. Tenant hereby represents and warrants that
it is not a party in interest to any pension plan, within the
meaning of Section 3(14) of the Employee Retirement Income Security
Act of 1974, as amended.

 

30.35. Unrelated
Business Income/Rents from Real Property. Landlord shall
have the right at any time and from time to time to unilaterally
amend the provisions of this Lease with respect to monies to be
paid to Landlord, if Landlord is advised by its counsel or its
accounting firm that all or any portion of the monies paid by
Tenant to Landlord hereunder (A) are, or may be deemed to be,
unrelated business income within the meaning of the United States
Internal Revenue Code of 1986, as amended, or regulations issued
thereunder (the “Code”), and/or (B) no longer qualify,
or there is risk that any such monies may not qualify, as
“rent from real property” under the Code, and Tenant
agrees that it will execute all documents or instruments necessary
to effect such amendment or amendments, provided that (i) no
such amendment shall result in Tenant having to pay, in the
aggregate, more money on account of its occupancy of the Premises
under the terms of this Lease, as so amended, (ii) no such
amendment shall result in any interference with Tenant’s use
and enjoyment of the Premises, (iii) no such amendment shall result
in any amendment, alteration or impact on Tenant’s
non-monetary rights or obligations under this Lease (including, but
not limited to, Tenant’s use of the Premises for the
Permitted Use), and (iv) no such amendment shall result in
Tenant receiving less services than it was then entitled to receive
under this Lease, or services of a lesser quality. Any services
which Landlord is required to furnish pursuant to the provisions of
this Lease may, at Landlord’s option, be furnished from time
to time, in whole or in part, by employees of Landlord or its
property manager or its employees or by one or more third persons
hired by Landlord or its property manager. Tenant agrees that upon
Landlord’s written request it will enter into direct
agreements with Landlord’s property manager or other parties
designated by Landlord for the furnishing of any such services
required to be furnished by Landlord hereunder, in form and content
approved by Landlord and Tenant, provided however that no such
contract shall result in (a) Tenant having to pay, in the
aggregate, more money on account of its occupancy of the Premises
under the terms of this Lease, (b) any interference with
Tenant’s use and enjoyment of the Premises; (c) any
amendment, alteration or impact on Tenant’s non-monetary
rights or obligations under this Lease (including, but not limited
to, Tenant’s use of the Premises for the Permitted Use), and
(d) Tenant, receiving less services than it was then entitled to
receive under this Lease, or services of a lesser
quality.

 

[SIGNATURE PAGE FOLLOWS]

 

45

 

 

IN
WITNESS WHEREOF the parties have executed this Lease, under seal,
as of the date first-above written.

 

	

Witness:

____________________________

Date:
_______________________

 

 

 

	

LANDLORD:

HAMPDEN
SQUARE CORPORATION,

a
Delaware corporation

By:
/s/ Michael
Gelber

Printed
Name: Michael
Gelber

Title:
Senior Asset
Manager

Date:
July 29,
2015

 

	

 

Witness:

____________________________

Date:
_______________________

 

	

TENANT:

SeD
HOME, INC.,a Delaware corporation

By:
/s/Jeffrey
Busch

Printed
Name: Jeffrey M.
BuschTitle: President

Date:
July 24,
2015

Taxpayer
ID No.: W13936588

 

 

 

 

46

 

 

EXHIBIT A

FLOOR PLAN OF PREMISES

 

 

 A-1

 

 

EXHIBIT B

 

SITE PLAN OF BUILDING

 

 

 B-1

 

 

EXHIBIT C

 

LEGAL DESCRIPTION

 

 

 

 

 C-1

 

 

EXHIBIT D

 

TERM CERTIFICATION

 

The
undersigned, as Tenant, under that certain lease dated
[______________________] (the “Lease”), with
[_________________________________], as Landlord, hereby certifies
as follows:

 

1.           That
the undersigned has entered into occupancy of the Premises
described in the Lease.

 

2.           That
the Lease is in full force and effect and has not been assigned,
modified, supplemented or amended in any way, except as follows:
_______________________________.

 

3.           That
the Lease represents the entire agreement between the parties as to
said leasing.

 

4.           That
the Commencement Date of the Lease is: __________________________.
The Lease expires on __________________________.

 

5.           That
all improvements to have been constructed or completed by Landlord
have been substantially completed in a satisfactory manner and all
conditions of the Lease to be performed by Landlord and necessary
to the enforceability of the Lease have been
satisfied.

 

6.           That
there are no defaults by either Tenant or Landlord under the
Lease.

 

7.           That
no rents have been prepaid, other than as provided in the
Lease.

 

8.           That
on this date there are no existing defenses or offsets, which the
undersigned has against the enforcement of the Lease by
Landlord.

 

9.           That
the undersigned has received ________ set(s) of keys to the
Premises on this date.

 

EXECUTED this
________ day of ___________________________, 20___.

 

TENANT:

 

[  ],

a
[  ]

 

By:                                                                        

 

Printed
Name:                                                                        

 

Title:                                                                        

 

 D-1

 

 

EXHIBIT E

 

INTENTIONALLY OMITTED

 

 

 

 

 E-1

 

 

EXHIBIT E-1

 

TENANT IMPROVEMENT WORK

 

Tenant
hereby accepts the Premises in their “AS-IS” condition,
and Landlord shall have no obligation to perform any work therein
(including, without limitation, demolition of any improvements
existing therein or construction of any tenant finish-work or other
improvements therein), and shall not be obligated to reimburse
Tenant or provide an allowance for any costs related to the
demolition or construction of improvements therein. Any additions,
alterations or improvements desired to be made by Tenant shall be
subject to the terms of Article 11 of this Lease.

 

 

 E-1-1

 

 

EXHIBIT E-2

 

CONSTRUCTION RULES AND REGULATIONS

 

1.           All
contractors, subcontractors, and materialmen (“Contractor
Parties”) will check in and out with Building
management.

 

2.           All
Contractor Parties will be appropriately dressed to work in an
office environment: shirts with sleeves (T-shirts with company name
are acceptable), pants (no shorts), work shoes with socks, and
whatever other clothing as may be appropriate. No torn or worn-out
clothing is permitted. Contractor Parties will display a courteous
demeanor towards tenants, customers, visitors and general public.
No Contractor Parties shall remain in the Building after work
hours.

 

3.           All
Contractor Parties shall clean the job site after meals are eaten.
Alcoholic beverages and drugs are not to be brought into, or
consumed in the Building. Personnel appearing to be under the
influence of either alcoholic beverages or drugs will not be
allowed into the Building.

 

4.           Parking
for all personnel must be arranged prior to commencement of work,
and will be provided in designated areas only. Vehicles in
unapproved areas will be subject to citation and towing without
notice. Any parking charges are the sole responsibility of the
Contractor Parties.

 

5.           Access
to the Building shall be by freight elevator only.

 

6.           Delivery
of materials, use of loading dock, freight and passenger elevators
must be scheduled with Landlord prior to receipt of
materials.

 

Delivery Dock
Hours:                                           Monday
–
Friday                                7:00
A.M. to 5:00 P.M.

 

Freight
Elevator
Hours:                                           Monday
–
Friday                                7:00
A.M. to 5:00 P.M.

 

Other
hours of access are available with prior arrangement.

 

7.           All
Contractor Parties shall maintain the condition of docks, elevators
and corridors used.

 

8.           All
materials are to be stored at the job site or in designated storage
areas. No materials are to be stored in corridors or in public
areas. Landlord may provide minimum secured storage for materials
with prior arrangement.

 

9.           Contractor
Parties must arrange access to areas other than job site at least
24 hours in advance.

 

10.           All
work areas are to be visually and materially protected from the
tenants and general public. If required by Landlord, the job site
shall be sealed off from the balance of the adjoining space so as
to minimize the disbursement of dirt, debris and
noise.

 

11.           Radios
or other excessive noise are not permitted.

 

12.           The
use of toxic materials or odor-causing liquids must be scheduled
with Landlord in advance and prior notice must be given to the
tenants adjacent to the job site.

 

13.           All
non-job site areas are to be kept clean and dust free. No material
residue shall be tracked through corridors or public
areas.

 

14.           Contractor
Parties shall ensure the job site is left clean and secure at the
completion of each work day. Trash and excess materials shall (a)
not remain on, in, or at the job site; (b) be disposed of in bins
or by truck promptly; (c) not be staged in storage at the job site
in any public or adjacent areas; and (d) shall not be disposed of
in the Building’s trash receptacles.

 

 E-2-1

 

 

EXHIBIT F

 

BUILDING SERVICES

 

Subject
to all Laws applicable thereto and the Rules and Regulations,
Landlord agrees to furnish the following services in a manner that
such services are customarily furnished to comparable projects in
the area:

 

1.           Electrical
power for normal general office use, as determined by
Landlord.

 

2.           Heating,
ventilation, and air-conditioning (“HVAC”), when
necessary for normal comfort for normal office use of the Premises
during Business Hours, except that, at Landlord’s option,
HVAC during Business Hours on Saturdays (if any) shall be upon
Tenant’s request only. If Tenant desires HVAC at any time
outside of Business Hours, Landlord shall use reasonable efforts to
furnish such service upon reasonable notice from Tenant, and Tenant
shall pay Landlord’s then-standard charges therefor on
demand.

 

3.           City
water from the regular Building outlets for drinking, lavatory and
toilet purposes.

 

4.           Maintenance
of the Common Areas.

 

5.           Non-exclusive
automatic passenger elevator service, provided that the number of
elevators available after Business Hours may be limited as Landlord
deems reasonably necessary.

 

6.           Replacement
for building standard lights bulbs. Tenant shall bear the cost of
replacement of non standard bulbs, and all fixtures, starters and
ballasts within the Premises.

 

7.           Restroom
supplies.

 

8.           Janitorial
services five (5) days per week, except for Holidays, in and about
the Premises and window washing services in a manner consistent
with other comparable buildings in the vicinity of the
Building.

 

9.           Landlord
may, from time to time, provide such on-premises courtesy personnel
(who will not necessarily have any responsibilities for any
security), the cost of which shall be an Operating Cost hereunder;
but Landlord makes no representation or warranty, written or oral,
express or implied, that any security will be provided to the
Project, or if provided, what the level of that security may be.
Landlord does not guarantee any level of security and is released
from any responsibility for any Claims based upon assertions that
Landlord failed to provide adequate security to the Project, the
Premises, or otherwise.

 

“Business
Hours” shall mean Monday through Friday, from 8:00 a.m. to
6:00 p.m. and Saturdays from 8:00 a.m. to 12:00 p.m., excluding
Holidays, which hours shall be subject to change by Landlord from
time to time.

 

 F-1

 

 

EXHIBIT G

 

RULES AND REGULATIONS

 

1.           The
Common Areas shall not be obstructed by any of the tenants or used
by them for any purpose other than for ingress to and egress from
their respective premises. The Common Areas are not for the general
public, and Landlord shall in all cases retain the right to control
and prevent access thereto of all persons whose presence in the
judgment of Landlord would be prejudicial to the safety, character,
reputation, and interest of the Building and its tenants; provided
that nothing herein contained shall be construed to prevent such
access to persons with whom any tenant normally deals in the
ordinary course of its business, unless such persons are engaged in
illegal activities. If the responsibility for the HVAC system is
not a tenant’s, no tenant and no employee or invitee of any
tenant shall go upon the roof of the Building except in the case of
maintenance of the HVAC system.

 

2.           The
Premises shall not be used for the storage of merchandise held for
sale to the general public or for lodging. No cooking shall be done
or permitted on the Premises except that private use by Tenant of
approved microwave ovens, equipment for brewing coffee, tea, hot
chocolate, and similar beverages shall be permitted, provided that
such use is in accordance with all Laws.

 

3.           No
tenant shall employ any person or persons other than the janitor of
Landlord for the purpose of cleaning its Premises unless otherwise
agreed to by Landlord in writing. Except with the consent of
Landlord (which consent may be withheld in Landlord’s sole
discretion), no person or persons other than those approved by
Landlord shall be permitted to enter the Building for the purpose
of cleaning the same. No tenant shall cause any unnecessary labor
by reason of such tenant’s carelessness or indifference in
the preservation of good order and cleanliness. Tenant shall
promptly notify Landlord of any carpet or wall stains requiring
attention. Janitor service will not be furnished on nights when
rooms are occupied after 6:00 p.m. unless, by agreement in writing,
service is extended to a later hour for specifically designated
rooms.

 

4.           Landlord
will furnish each tenant free of charge with two (2) keys to each
door provided in the premises by Landlord. Landlord may make a
reasonable charge for additional keys. No tenant shall have any
such keys copied. No tenant shall alter any lock or install a new
or additional lock or any bolt on any door of its premises. Each
tenant upon the termination of its lease shall deliver to Landlord
all keys to doors in the Building. Should Tenant install a locking
system that requires a code, such code shall be provided to
Landlord in writing, and all subsequent changes to the code will be
provided in writing twenty-four (24) hours prior to such change
taking place.

 

5.           Landlord
shall designate appropriate entrances for deliveries or other
movement to or from the Premises of equipment, materials, supplies,
furniture, or other property, and Tenant shall not use any other
entrances for such purposes. Landlord must have approved all means
or methods used to move equipment, materials, supplies, furniture,
or other property in or out of the Building prior to any such
movement. Landlord will not be responsible for loss of or damage to
any such property from any cause, and all damage done to the
Building by moving or maintaining such property shall be repaired
at the expense of Tenant. Tenant shall move all freight, supplies,
furniture, fixtures, and other personal property only at such times
as Landlord may designate. Unattended vehicles will be towed at the
vehicle owner’s expense.

 

6.           No
tenant shall use any method of heating or ventilation or air
conditioning other than that supplied by Landlord.

 

7.           No
animals (except for service animals) shall be brought or kept in
the Premises or the Building.

 

8.           Landlord
shall in no case be liable for damages for any error with regard to
the admission to or exclusion from the Building of any person in
the case of invasion, mob, riot, public excitement, or other
circumstances rendering such action advisable in Landlord’s
opinion. Landlord reserves the right to prevent access to the
Building during the continuance of the same by such action as
Landlord may deem appropriate, including closing
doors.

 

 

G-1

 

 

9.           No
curtains, draperies, blinds, shutters, shades, screens, or other
coverings, hangings, or decorations shall be attached to, hung, or
placed in, or used in connection with, any window of the Building.
Such items shall be installed on the office side of
Landlord’s standard window covering and shall in no way be
visible from the exterior of the Building. Tenant shall keep window
coverings closed when the effect of sunlight (or the lack thereof)
would impose unnecessary loads on the Building’s heating or
air condition systems.

 

10.           Tenant
shall ensure that the doors of the Premises are closed and locked
and that all water faucets, water apparatus, and utilities are shut
off before Tenant or Tenant’s employees leave the Premises so
as to prevent waste or damage, and for any default or carelessness
in this regard, Tenant shall make good all injuries sustained by
other tenants or occupants of the Building or Landlord. On
multiple-tenancy floors, all tenants shall keep the doors to the
Building corridors closed at all times except for ingress and
egress.

 

11.           The
toilet rooms, toilets, urinals, wash bowls, and other apparatus
shall not be used for any purpose other than that for which they
are constructed, no foreign substance of any kind whatsoever shall
be thrown therein, and the expense of any breakage, stoppage, or
damage resulting from the violation of this rule shall be borne by
the tenants who, or whose employees or invitee, shall have caused
it.

 

12.           No
tenant shall sell at retail newspapers, magazines, periodicals,
theater or travel tickets, or any other goods or merchandise to the
general public in or on the Premises, nor shall any tenant carry on
or permit any employee or other person to carry on the business of
stenography, typewriting, printing, or photocopying or any similar
business in or from the Premises for the service or accommodation
of occupants of any other portion of the Building; nor shall the
premises of any tenant be used for manufacturing of any kind, or
any business or activity other than that specifically provided for
in such tenant’s lease.

 

13.           No
tenant shall install any radio or television antenna, loudspeaker,
or other device on the roof or exterior walls of the Building. No
TV or radio or recorder shall be played in such a manner as to
cause a nuisance to any other tenant.

 

14.           There
shall not be used in any space, or in the public halls of the
Building, either by any tenant or others, any hand trucks except
those equipped with rubber tires and side guards or such other
material handling equipment as Landlord may approve. No other
vehicles of any kind shall be brought by any tenant into the
Building or kept in or about its premises.

 

15.           Each
tenant shall store all its trash and garbage within its premises.
No material shall be placed in the hallways or in the trash boxes
or receptacles if such material is of such nature that it may not
be disposed of in the ordinary and customary manner of removing and
disposing of office building trash and garbage in the locale
without being in violation of any law or ordinance governing such
disposal. All garbage and refuse disposal shall be made only
through entryways provided for such purposes and at such times as
Landlord shall designate. Each tenant shall comply with any and all
Laws regarding recycling.

 

16.           Canvassing,
soliciting, distribution of handbills, or any other written
material and peddling in the Building are prohibited, and each
tenant shall cooperate to prevent the same.

 

17.           Except
in a case of emergency, the requirements of tenants will be
attended to only upon application in writing at the office of the
Building or by facsimile transmitted to the office of the Building
manager. Employees of Landlord shall not perform any work or do
anything outside of their regular duties unless under special
instructions from Landlord.

 

 

G-2

 

 

18.           Tenant
shall not occupy the Building or permit any portion of the Building
to be occupied for the manufacture, distribution, or direct sale of
liquor, narcotics, or tobacco in any form, or as a medical office,
barber shop, manicure shop, music or dance studio, or employment
agency. Tenant shall not conduct in or about the Building any
auction, public or private, without the prior written approval of
Landlord, which approval may be withheld in Landlord’s sole
discretion.

 

19.           Tenant
shall not use in the Building any machines, other than standard
office machines, such as typewriters, calculators, desktop
computers, copying machines, and similar machines, without the
prior written approval of Landlord. All office equipment and any
other device of any electrical or mechanical nature shall be placed
by Tenant in the Premises in settings approved by Landlord, so as
to absorb or prevent any vibration, noise, or annoyance. Tenant
shall not cause improper noises, vibrations, or odors within the
Building.

 

20.           Tenant
shall not enter the mechanical rooms, air conditioning rooms,
electrical closets, janitorial closets, or similar areas or go upon
the roof of the Building.

 

21.           Tenant
shall not mark, paint, drill into, cut, string wires within, or in
any way deface any part of the Building, without the prior consent
of Landlord, and as Landlord may direct.

 

22.           Tenant
will not place objects on window sills or otherwise obstruct the
exterior wall window covering.

 

23.           Tenant
will keep all doors opening to the exterior of the Building, all
fire doors, and all smoke doors closed at all times.

 

24.           Tenant
shall not obstruct, alter, or in any way impair the efficient
operation of Landlord’s heating, ventilating, electrical,
fire, safety, or lighting systems, nor shall Tenant tamper with or
change the setting of any thermostat or temperature control valves
in the Building.

 

25.           If
Tenant uses the Premises after regular business hours or on
non-business days Tenant shall lock any entrance doors to the
Building or to the Premises used by Tenant immediately after using
such doors.

 

26.           Tenant
shall not use any portion of the Premises for lodging.

 

27.           Landlord
reserves the right to exclude or expel from the Building any person
who, in the judgment of Landlord is intoxicated or under the
influence of liquor or drugs, or who shall in any manner do any act
in violation of any of these Rules and Regulations.

 

28.           Tenant
shall not park or attach any bicycle or motor driven cycle on or to
any part of the Premises or Building.

 

29.           Tenant
shall not install any artwork that could give an artist or any
other party a right under applicable Law to prevent removal of the
same.

 

30.           This
is a non-smoking facility. Smoking is prohibited within the
confines of the building in all public areas, which includes
interior common area hallways and restrooms.

 

31.           Provided
Landlord acts in good faith pursuant to sound operating procedures,
Landlord may waive any one or more of these Rules and Regulations
for the benefit of any particular tenant or tenants, but no such
waiver by Landlord shall be construed as a waiver of such Rules and
Regulations in favor of any other tenant or tenants, nor prevent
Landlord from thereafter enforcing any such Rules and Regulations
against any or all of the tenants of the Building.

 

32.           These
Rules and Regulations are in addition to, and shall not be
construed to in any way modify or amend, in whole or in part, the
agreements, covenants, conditions, and provisions of any lease of
premises in the Building.

 

33.           Landlord
reserves the right to modify the foregoing and promulgate such
other rules and regulations as Landlord may from time to time
decide are needed for the safety, care, or cleanliness of the
Building, for the preservation of good order therein, or as changed
conditions or particular circumstances may require.

 

 

G-3

 

 

EXHIBIT H

 

PARKING AGREEMENT

 

Tenant
shall be provided the number of non-exclusive parking spaces as set
forth on the Lease Summary, in such areas or spaces as Landlord
shall determine from time to time (the “Non-exclusive
Parking”). The Non-exclusive Parking shall be available for
use by Tenant on a “non-reserved” and “space
available” basis during Business Hours.

 

During
the Term, the monthly rate per vehicle for any parking spaces
granted Tenant shall be the then prevailing rate generally charged
for such parking (and the current prevailing rate is set forth in
the Lease Summary). The parking rates charged by Landlord for
Tenant’s parking passes shall be exclusive of any parking tax
or other charges imposed by governmental authorities in connection
with the use of such parking, which taxes and/or charges shall be
paid directly by Tenant or the parking users, or, if directly
imposed against Landlord, Tenant shall reimburse Landlord for all
such taxes and/or charges concurrent with its payment of the
parking rates described herein.

 

Tenant’s use
of the parking areas serving the Building shall be subject to the
following:

 

1.           Parking
shall not be permitted for Tenant or its employees in the Project
over and above the number of spaces designated on the Lease Summary
and any parking by Tenant or its employees in excess of such number
of spaces shall be a Default under this Lease.

 

2.           All
parking areas shall be under the control of Landlord, and Tenant
agrees that all Tenant Related Parties shall conform to such
reasonable written parking regulations, conditions and provisions
as may from time to time be prescribed by Landlord, provided the
same do not increase Tenant’s obligations or decrease
Tenant’s rights.

 

3.           If
Tenant is not permitted to utilize any parking space in the parking
areas at any time through no direct intentional act of Landlord,
such facts shall never be deemed to be a default by Landlord so as
to permit Tenant to terminate this Lease (either in whole or in
part) or pursue other remedies; provided, however, so long as
Tenant is not able to utilize any such parking space (for reasons
other than as a result of the negligence of any Tenant Related
Party) and Landlord does not provide reasonable alternate parking,
Tenant’s obligation to pay rental for any such parking space
that is not provided shall be abated for so long as Tenant does not
have the use of such parking space. Such abatement shall constitute
full settlement of all Claims that Tenant might otherwise have
against Landlord by reason of such failure or inability to provide
Tenant with such parking space. Landlord agrees to use reasonable
efforts to provide alternate parking for use by Tenant in
reasonable proximity to the Building. Landlord shall not be
responsible for enforcing Tenant’s parking rights against any
third parties.

 

4.           Restricted
and unrestricted parking areas shall include only those areas
designated by Landlord as such.

 

5.           Landlord
will be entitled to utilize whatever access device Landlord deems
necessary (including but not limited to the issuance of parking
stickers or access cards) to assure that only those persons
contracting for the use of spaces in the parking areas are using
the parking spaces therein. In the event any Tenant Related Parties
wrongfully park in any parking spaces, Landlord will be entitled
and is hereby authorized to impose upon Tenant a charge of $25.00
for each such occurrence. Tenant hereby agrees to pay all amounts
becoming due hereunder as Additional Rent upon demand therefor, and
the failure to pay any such amount will additionally be deemed a
Default.

 

6.           All
vehicles are to be currently licensed, in good operating condition,
parked for business purposes having to do with Tenant’s
business operated in the Premises, parked within designated parking
spaces, one (1) vehicle to each space. No vehicle shall be parked
as a “billboard” vehicle in the parking lot. Any
vehicle parked improperly may be towed away. Any Tenant Related
Parties who do not operate or park their vehicles as required shall
subject the vehicle to being towed at the expense of the owner or
driver. Landlord may place a “boot” on the vehicle to
immobilize it and may levy a charge of $50.00 to remove the
“boot.” Tenant shall indemnify, hold and save harmless
Landlord of any Claims arising from the towing or booting of any
unauthorized vehicles.

 

7.           Tenant
acknowledges and agrees that Landlord may, without incurring any
liability to Tenant and without any abatement of Rent under this
Lease, from time to time, close-off or restrict access to the
parking area, or relocate Tenant’s parking spaces to other
parking areas within a reasonable distance of the Premises, for
purposes of permitting or facilitating any such construction,
alteration or improvements with respect to the parking area or to
accommodate or facilitate renovation, alteration, construction or
other modification of other improvements or structures located on
the Property.

 

8.           Landlord
may delegate its responsibilities hereunder or lease the parking
facilities to a parking operator in which case such parking
operator shall have all the rights of control attributed hereby to
Landlord but Landlord shall not be responsible or liable for the
acts or omissions of such parking operator.

 

 H-1

 

 

TABLE OF CONTENTS

 

  Page

 

	

ARTICLE
1 LEASE OF PREMISES

	

5

	

ARTICLE
2 DEFINITIONS

	

5

	

ARTICLE
3 PREMISES AND DELIVERY OF POSSESSION

	

12

	

ARTICLE
4 RENT

	

13

	

ARTICLE
5 SECURITY DEPOSIT

	

15

	

ARTICLE
6 USE

	

15

	

ARTICLE
7 HAZARDOUS MATERIALS

	

16

	

ARTICLE
8 SERVICES AND UTILITIES

	

17

	

ARTICLE
9 CONDITION OF THE PREMISES

	

18

	

ARTICLE
10 REPAIRS AND MAINTENANCE

	

19

	

ARTICLE
11 ALTERATIONS AND ADDITIONS

	

19

	

ARTICLE
12 CERTAIN RIGHTS RESERVED BY LANDLORD

	

22

	

ARTICLE
13 RULES AND REGULATIONS

	

23

	

ARTICLE
14 TRANSFERS

	

23

	

ARTICLE
15 DESTRUCTION OR DAMAGE

	

26

	

ARTICLE
16 EMINENT DOMAIN

	

27

	

ARTICLE
17 INDEMNIFICATION, WAIVER, RELEASE AND LIMITATION OF
LIABILITY

	

28

	

ARTICLE
18 INSURANCE

	

29

	

ARTICLE
19 DEFAULT

	

31

	

ARTICLE
20 LANDLORD REMEDIES AND DAMAGES

	

32

	

ARTICLE
21 BANKRUPTCY

	

36

	

ARTICLE
22 LIEN FOR RENT

	

37

	

ARTICLE
23 HOLDING OVER

	

37

	

ARTICLE
24 SURRENDER OF PREMISES

	

37

	

ARTICLE
25 BROKERAGE FEES

	

38

	

ARTICLE
26 NOTICES

	

38

	

ARTICLE
27 RELOCATION OF PREMISES

	

38

	

ARTICLE
28 SIGNAGE

	

38

	

ARTICLE
29 LENDER PROVISIONS

	

39

	

ARTICLE
30 MISCELLANEOUS

	

40

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