Document:

Unassociated Document

    

    COURTHOUSE
      SQUARE 

    LEASE
      AGREEMENT

    

    This
      Courthouse Square Lease Agreement ("Lease") is made and entered into this
      1st
      day of
      July, 2006, by and between the CITY OF HANFORD, a municipal corporation, with
      its principal place of business in the City of Hanford, County of Kings, State
      of California (hereinafter referred to as "Landlord"), and Global
      Food Technologies, Inc.,
      a
      Delaware Corporation with its principal place of business in the City
      of
      Hanford,
      County
      of Kings,
      State
      of California, (hereinafter referred to as "Tenant").

    

    WITNESSETH:
      that;

    

    The
      parties hereto, in consideration of the rental hereinafter reserved and the
      covenants and agreements hereinafter set forth, do make and enter into the
      following Agreement of Lease:

    

    1.
      PREMISES

    

    On
      June
      27, 2005, Landlord and Tenant entered into an oral lease whereby Landlord leased
      to Tenant and Tenant hired and took from Landlord, at the rental rate, and
      upon
      the conditions hereinafter set forth in this Courthouse Square Lease Agreement
      (“Lease”), those certain premises identified as Suites
      205, 206 and 207
      comprising and area of approximately 1,322
      square
      feet of the Courthouse Square Building, together with all rights and
      appurtenances thereto, being located in the City of Hanford, County of Kings,
      State of California, and more commonly known as 113
      Court
      Street,
      Hanford, California 93230 (“Premises’). Landlord and Tenant enter into this
      Lease to agree and confirm that: (i) Tenant’s possession and use of the Premises
      for the time period of June 27, 2005 to June 30, 2006, inclusive, was in
      accordance with and pursuant to all of the terms and conditions of this Lease;
      and (ii) Landlord leases to Tenant and Tenant hires and takes from Landlord,
      for
      the term identified in this Lease, the Premises and all rights and appurtenances
      thereof in accordance with and pursuant to all of the terms and conditions
      of
      this Lease. 

    

    2.
      FACILITY
      COMMON AREAS

    

    The
      term
      "common areas" means all areas and facilities outside the Premises and within
      the interior and exterior boundaries of the Courthouse Square Building within
      which the Premises is located that are provided and designated by Landlord
      from
      time to time for the general use and convenience of Tenant and of other tenants
      of the Courthouse Square Building and their respective authorized
      representatives and invitees. Common areas include, without limitation,
      walkways, decorative walls, plazas, malls, loading areas, roads, parking area
      and restrooms.

     

    
      
        
        

      

      
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    A. Tenant's
      Right to Use:

    

    Landlord
      gives to Tenant and its authorized representatives and invitees the
      non-exclusive right to use the common areas, with others who are entitled to
      use
      the common areas, subject to Landlord's rights as hereinafter set
      forth.

    

    B. Landlord's
      Maintenance and Management:

    

    Landlord
      shall maintain the common areas in good condition at all times. Landlord shall
      have the right to:

    

    1. Establish
      and enforce reasonable rules and regulations applicable to all tenants
      concerning the maintenance, management, use, and operation of the common areas.
      

    2. Close
      any
      of the common areas to whatever extent required in the opinion of Landlord's
      counsel to prevent a dedication of any of the common areas or the accrual of
      any
      rights to any person or of the public to the common areas. 

    3. Close
      temporarily any of the common areas for maintenance purposes.

    4. Designate
      other property outside the boundaries for the Courthouse Square Building to
      become part of the common areas. 

    5. Select
      a
      person to maintain and operate any of the common areas if at any time Landlord
      determines that the best interests of the Courthouse Square Building will be
      served by having any of the common areas maintained and operated by that person.
      Landlord shall have the right to negotiate and enter into a contract with that
      person on such terms and conditions and for such period of time as Landlord
      deems reasonable and proper both as to service and as to cost.

    6. Make
      changes to the common areas including, without limitation, changes in the
      location of driveways, entrances, exits, or the direction of the flow of traffic
      so long as such changes do not unreasonably interfere with Tenant's use and
      possession of the Premises.

    

    C. Tenant's
      Share of Cost:

    

    Tenant
      shall pay to Landlord, on a monthly basis, an amount calculated by Landlord
      to
      be Tenant's share of Common Area Costs (as defined in this paragraph), on the
      first day of each month, commencing on the date the term commences, or on the
      first day of the month following the month the term commences if the term
      commences on a day other than the first day of a month as the case may be,
      and
      continuing during the term or any extension thereof. 

    Tenant's
      proportionate share of Common Area Costs shall be calculated by multiplying
      the
      total Common Area Costs times the ratio of the total number of square feet
      in
      the Premises to the total number of leasable square feet in the Courthouse
      Square Building. Common Area Costs that cover a period not within the term
      of
      this Lease shall be prorated.

     

    
      
        
        

      

      
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                    Landlord
      can adjust
      the monthly Common Area Costs July 1st
      of each
      year of the lease term, on the basis of Landlord's calculation of Common Area
      costs for the next year of the lease term. 

    Landlord
      shall furnish to Tenant a statement showing the total Common Area Costs,
      Tenant's share of Common Area Costs for that respective year of the lease term,
      and the monthly payments to be made by Tenant for that next year. For the time
      period commencing on the date of this Lease through June
      30, 2007,
      Tenant's monthly Common Area Cost shall be Two Hundred Dollars and Sixty-eight
      Cents ($200.68).

    For
      purposes hereof, the term "Common Area Costs" shall include, but is not limited
      to, the real property taxes and assessments and other taxes and assessments
      of
      any nature levied or assessed against the Common Areas and the Courthouse Square
      Building, or assessed against Landlord as a result of the Common Areas or the
      Courthouse Square Building, all natural gas and electrical charges assessed
      against the Common Areas, all of Landlord's cost for any type of insurance
      for
      the Common Areas and the Courthouse Square Building, all sums expended by
      Landlord for property management and maintenance and operation of the Common
      Areas, and the cost of natural gas service for the Premises.

    Costs
      of
      maintenance and operation of the Common Areas shall include, without limitation,
      cleaning, sweeping and other janitorial services, policing, maintenance of
      refuse receptacles, security systems, parking lot maintenance, planting and
      relandscaping, directional signs and other markers, lighting and other utilities
      and premiums for public liability and property damage insurance, and other
      costs
      necessary in Landlord's judgment for the maintenance and operation of the Common
      Areas.

    

    
      	3.  	
              TERM
                OF LEASE

            

    

    

    The
      term
      of this lease shall be for a period of three (3) years, effective , July 1,
      2005
      and ending at midnight, Pacific Standard Time or Pacific Daylight Time,
      whichever is applicable, June 30, 2008. 

    

    A. Delivery
      of Possession:

    

    Tenant
      agrees that, in the event of the inability of Landlord to deliver possession
      of
      the Premises to Tenant on the date above specified for the commencement of
      this
      Lease, this Lease shall not be void or voidable, nor shall Landlord be liable
      to
      Tenant for any loss or damage resulting therefrom, nor shall the expiration
      date
      of the above term be in any way extended, but, in such event, Tenant shall
      not
      be liable for any rent until such time as Landlord delivers possession of the
      Premises to Tenant.

    

    The
      provisions of Subsection (1) of Section 1932 of the California Civil Code shall
      not apply to this Lease, and Tenant waives the benefit of such
      provisions.

    

    Should
      Landlord tender possession of the Premises to Tenant prior to the date specified
      for commencement of the term thereof, and Tenant elects to accept such prior
      tender, such prior occupancy shall be subject to all of the terms, covenants,
      and conditions of this Lease, except payment of rent. By entering into and
      occupying the Premises, Tenant shall be deemed to acknowledge that the Premises
      are in good order and repair.

     

    
      
        
        

      

      
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    B. Surrender
      of Premises:

    

    Tenant
      agrees to surrender the Premises at the termination of the tenancy herein
      created to Landlord including all of the Tenant's improvements and alterations
      in good condition (except for ordinary wear and tear occurring to the Premises
      and except for alterations that Tenant has the right to remove or is obligated
      to remove under the provisions of this Lease). Tenant shall remove all its
      personal property prior to the date of termination of the tenancy and shall
      remove all other improvements and alterations to the Premises if Landlord
      directs Tenant to do so, at Tenant's sole cost and expense. Tenant shall perform
      all restoration made necessary by the removal of any alterations or Tenant's
      personal property prior to termination of the tenancy.

    

    Landlord
      can elect to retain or dispose of in any manner any alterations or Tenant's
      personal property that Tenant does not remove from the Premises upon termination
      of the tenancy as allowed or required by this Lease by giving at least ten
      (10)
      days notice to Tenant. Title to any such alterations or Tenant's personal
      property that Landlord elects to retain or dispose of on expiration of the
      ten
      (10) day period shall vest in Landlord. Tenant waives all claims against
      Landlord for any damage to Tenant resulting from Landlord’s retention or
      disposition of any such alterations or Tenant's personal property. Tenant shall
      be liable to Landlord for Landlord's cost for storing, removing and disposing
      of
      any alterations of Tenant's personal property.

    

    If
      Tenant
      fails to surrender the Premises to Landlord on the termination of the tenancy,
      Tenant shall indemnify, defend and hold Landlord harmless from any claims,
      damages, costs, expenses and attorney’s fees incurred by Landlord as a result of
      Tenant's failure to surrender the Premises.

    

    If
      Tenant
      shall fail to remove all of its effects from said Premises upon termination
      of
      this Lease for any cause whatsoever, Landlord may, at its option, remove the
      same in any manner that Landlord shall choose, and store said effects without
      liability to Tenant for loss thereof, and Tenant agrees to pay Landlord upon
      demand any and all expenses incurred in such removal including court costs
      and
      attorney’s fees and storage charges on such effects for any length of time that
      the same shall be in Landlord's possession, or Landlord may, at its option,
      without notice, sell said effects, or any of the same, at private sale and
      without legal process, for such price as Landlord may obtain and apply the
      proceeds of such sale upon any amounts due under this Lease from Tenant to
      Landlord and upon the expense incident to the removal and sale of said
      effects.

    

    
      	 	
              C.

            	
              Holding
                Over:

            

    

    

    If
      Tenant
      holds over after the expiration or earlier termination of the term of this
      Lease, Tenant shall become a Tenant at sufferance only, at the rental rate
      of
      150% of the rental rate in effect on the date of such expiration and otherwise
      upon the terms, covenants and conditions herein specified, so far as
      applicable.

     

    
      
        
        

      

      
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    If
      Tenant, with Landlord's express written consent, remains in possession of the
      Premises after expiration or earlier termination of the term hereof, such
      possession shall be deemed a month-to-month tenancy, terminable on thirty (30)
      days written notice given at any time by either party, and at the rental rate
      in
      effect upon the date of such expiration and otherwise upon the terms, covenants,
      and conditions herein specified, so far as applicable. Acceptance by Landlord
      of
      rent after such expiration or earlier termination shall not constitute a
      holdover hereunder or result in a renewal of this Lease.

     

    
      	4.  	
              RENT

            

    

    

    Tenant
      agrees to and shall pay to Landlord as rent for the Premises the
      following:

    

    A. Monthly
      Rent:

    

    Tenant
      agrees to pay Landlord as the total rent for the Premises for the period of
      July
      1, 2006 through June 30, 2007, Fifteen Thousand Eight Hundred Twenty-four
      Dollars and Forty Cents ($15,824.40) in equal monthly installments of One
      Thousand Three Hundred Eighteen Dollars and Seventy Cents ($1,318.70), each
      in
      advance on the first day of each and every calendar month during said term,
      except that the first month's rent shall be paid upon the execution of this
      Lease. In the event the term of this Lease commences or ends on a day other
      than
      the first day of a calendar month, then the rental for such periods shall be
      prorated in the proportion that the number of days this Lease is in effect
      during such period bears to thirty (30) days, and such rental shall be paid
      at
      the commencement of such periods. Said rental shall be paid to Landlord, without
      deduction offset, prior notice or demand, in lawful money of the United States
      of America, which shall be legal tender at the time of payment, at the office
      of
      Landlord or to such other person or at such other place as Landlord may, from
      time to time, designate in writing. 

    

    Tenant
      shall pay to Landlord, concurrent with the effectiveness of this Lease, an
      amount equal to the first and last month's rent of the Premises.

    

    B. Tenant
      Improvements

    

    In
      addition to the Rental described in Section 4A of this Lease Agreement, Tenant
      agrees to pay Landlord as reimbursement for Tenant Improvements completed by
      Landlord at Tenants request, the total sum of Twenty-four Thousand Six Hundred
      Fifty Three Dollars and Seventeen Cents ($24,653.17) in thirty six (36) equal
      monthly installments of Six Hundred Eighty-four Dollars and Eighty-one Cents
      ($684.81), each payable on the first day of each and every calendar month during
      said term of this Lease.

     

    
      
        
        

      

      
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    C. Rental
      Adjustment 

    

    Commencing
      with the thirteenth (13th) full calendar month of the term of this Lease, and
      at
      the end of each twelfth (12th) month thereafter, during the term, the Monthly
      Rent as described in Section 4A of this Lease Agreement for the ensuing twelve
      (12) month period ("Adjustment Period") shall be increased by 5.0%.

    

    D. Security
      Deposit:

    

    On
      execution of this Lease, Tenant shall deposit with Landlord an amount equal
      to
      one month’s rent as a security deposit for the performance by Tenant of the
      provision of this Lease. If Tenant is in default, Landlord can use the security
      deposit, or any portion of it, to cure the default or to compensate Landlord
      for
      all costs and damages sustained by Landlord resulting from Tenant’s default.
      Tenant shall immediately on demand, pay to Landlord a sum equal to the portion
      of the security deposit expended or applied by Landlord as provided in this
      paragraph so as to maintain the security deposit in the sum initially deposited
      with Landlord. If Tenant is not in default at the expiration or termination
      of
      this Lease, Landlord shall return the security deposit to Tenant. Landlord’s
      obligations with respect to the security deposit are those of a debtor and
      not a
      trustee. Landlord can maintain the security deposit separate and apart from
      Landlord’s general funds or can co-mingle the security deposit with Landlord’s
      general and other funds. Landlord shall not be required to pay Tenant interest
      on the security deposit.

     

    E. Late
      Charge

    

    Tenant
      acknowledges that late payment by Tenant to Landlord of rent will cause Landlord
      to incur costs not contemplated by this Lease, the exact amount of such costs
      being extremely difficult and impracticable to fix. Such costs include, without
      limitation, processing and accounting charges, and late charges that may be
      imposed on Landlord by the terms of any encumbrance and note secured by any
      encumbrance covering the Premises. Therefore, if any installment of rent due
      from Tenant is not received by Landlord within ten (10) days from the date
      when
      said rent was due, Tenant shall pay to Landlord an additional sum of Ten Percent
      (10%) of the overdue rent as a late charge. The parties agree that this late
      charge represents a fair and reasonable estimate of the costs that Landlord
      will
      incur by reason of late payment by Tenant. Acceptance of any late charge shall
      not constitute a waiver of Tenant's default with respect to the overdue amount,
      nor prevent Landlord from exercising any of the other rights and remedies
      available to Landlord.

    

    
      	5.  	
              TAXES
                AND ASSESSMENTS

            

    

    

    A. Personal
      Property and Possessory Interest Taxes:

    

    If
      during
      the term of this Lease or any extension thereof, Tenant is required to pay
      taxes
      as defined below, Tenant, shall be liable for and shall pay ten (10) days before
      delinquency all taxes, assessments, license fees, and other charges ("Taxes")
      that are levied and assessed against Tenant's personal property or trade
      fixtures installed or located in or about Premises or Tenant's possessory
      interest in the Premises, and that become payable during the Lease term. On
      demand by Landlord, Tenant shall furnish Landlord with satisfactory evidence
      of
      these payments.

     

    
      
        
        

      

      
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    If
      any
      taxes on Tenant's personal property, trade fixtures or possessory interest
      are
      levied against Landlord or Landlord's property, or if the assessed value of
      the
      Premises is increased by the inclusion of a value on Tenant's personal property,
      trade fixtures or possessory interest and if Landlord pays the Taxes on any
      of
      these items of the Taxes based on the increased assessment of these items,
      which
      Landlord shall have the right to do regardless of the validity thereof, but
      only
      under proper protest if requested by Tenant, Tenant shall on demand, immediately
      reimburse Landlord for the sum of the Taxes levied against Landlord, or the
      proportion of the Taxes resulting from the increase in Landlord's
      assessment.

    

    If
      Tenant's improvements on the Premises, whether installed and/or paid for by
      Landlord or Tenant and whether or not affixed to the real property so as to
      become a part thereof, are assessed for Real Property tax purposes at a
      valuation higher than the valuation at which Tenant's improvements are assessed,
      then the Real Property taxes and assessments levied against Landlord or the
      Premises by reason of such excess assessed valuation shall be deemed to be
      taxes
      levied against personal property of Tenant and shall be governed by the
      provisions of the above. If the records of the County Assessor are available
      and
      sufficiently detailed to serve as a basis for determining whether said Tenant
      improvements are assessed at a higher valuation, such records shall be binding
      on both Landlord and Tenant. If the records of the County Assessor are not
      available or sufficiently detailed to serve as a basis for making said
      determination, the actual cost of construction shall be used.

    

    B. Tenant
      Acknowledgment Of Possessory Interest Taxes

    

    Tenant
      acknowledges, understands and agrees that: (1) this Lease may create a
      possessory interest in Tenant which may be subject to real property taxes;
      (2)
      the property interest of Tenant created by this Lease may be subject to property
      taxes; and (3) this Lease may be subject to property taxes. Tenant agrees to
      pay
      all such taxes, as identified above, before the same become
      delinquent.

    

    
      	6.  	
              USE
                OF PREMISES

            

    

    

    A. Permitted
      Use:

    Tenant
      shall use the Premises for Corporate
      Business Offices
      and for
      no other use without Landlord's consent. Tenant shall conduct its business
      at
      the Premises as Global
      Food Technologies, Inc.

    

    B. Prohibited
      Use:

    

    Tenant
      shall not use or occupy the Premises in violation of law or of the Certificate
      of Occupancy issued for the Premises, and shall, upon five (5) days written
      notice from Landlord, discontinue any use of the Premises declared by any
      governmental authority having jurisdiction including but not limited to
      Landlord, which shall, by reason of the nature of Tenant's use or occupancy
      of
      the Premises, impose any duty upon Tenant or Landlord with respect to the
      Premises or with respect to the use or occupancy thereof. Tenant shall not
      do or
      permit to be done anything which will invalidate, cause cancellation or increase
      the cost of any fire, extended coverage of any other insurance policy covering
      the Premises and/or property located therein and shall comply with all rules,
      orders, regulations. and requirements of the Pacific Fire Rating Bureau or
      any
      other organization performing a similar function.

     

    
      
        
        

      

      
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    If
      the
      rate of any insurance carried by Landlord is increased as a result of Tenant's
      use, Tenant shall pay to Landlord within ten (10) days before the date Landlord
      is obligated to pay a premium on the insurance, or within fifteen (15) days
      after Landlord delivers to Tenant a certified statement from Landlord's
      insurance carrier stating that the rate increase was caused solely by an
      activity of Tenant on the Premises as permitted in this Lease, whichever date
      is
      later, a sum equal to the difference between the original premium and the
      increased premium.

    

    Tenant
      shall comply with all laws concerning the Premises or Tenant's use of the
      Premises, including, without limitation, the obligation at Tenant's cost to
      alter, maintain, or restore the Premises in compliance and conformity with
      all
      laws relating to the condition, use or occupancy of the Premises during the
      term
      of this Lease.

    

    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 article.

    

    Tenant
      shall not use or allow the Premises to be used for any improper, immoral,
      unlawful, or objectionable purpose, nor shall Tenant cause, maintain or permit
      any nuisance in, on or about the Premises.

    

    Tenant
      shall not use the Premises in any manner that will constitute waste, nuisance,
      or unreasonable annoyance (including, without limitation, the use of
      loudspeakers or sound or light apparatus that can be heard or seen outside
      the
      Premises) to other tenants in the Facility in which the Premises are
      located.

    

    Tenant
      shall not use the Premises for sleeping, washing clothes, cooking, or the
      preparation, manufacture, or mixing of anything that might emit any odor or
      objectionable noises or lights onto the Premises.

    

    No
      secondhand store, auction, distress or fire sale, or bankruptcy or going
      out-of-business sale may be conducted on the
      Premises without Landlord's consent. Tenant shall not sell or display
      merchandise outside the confines of the Premises.

    

    Tenant
      shall not do anything on the Premises that will cause damage to the
      Premises.

     

    
      
        
        

      

      
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    The
      Premises shall not be overloaded. No machinery, apparatus, or other appliance
      shall be used or operated in or on the Premises that will in any manner injure,
      vibrate, or shake the Premises.

    

    Tenant
      will not, without the written consent of Landlord, either use any apparatus
      or
      devise in connection with the Premises which will in any way increase the amount
      of electricity or water usually furnished or supplied to the Premises, or
      connect with the electric current or with water any apparatus or device for
      the
      purpose of using electric current or water.

    

    Throughout
      the term of this Lease, Tenant, at its sole cost, shall maintain the Premises
      in
      compliance with the Americans With Disabilities Act of 1990 and the regulations
      related thereto.

    

    
      	7.  	
              LEASEHOLD
                IMPROVEMENTS

            

    

    

                    Tenant
      shall, at its
      own cost and expense, furnish and install all leasehold improvements. Said
      improvements shall be subject to Landlord's prior written consent thereto and
      shall be in accordance with the plans and specifications first approved by
      Landlord. 

                

                    Tenant
      covenants and
      agrees that all work done by Tenant shall be performed in full compliance with
      all laws, rules, orders, ordinances, directions, regulations, and requirements
      of all governmental agencies, offices, departments, bureaus and board having
      jurisdiction and in full compliance with the rules, orders, directors,
      regulations and requirements of the Pacific Fire Rating Bureau and of any
      similar body. Tenant shall keep the Premises and all improvements thereon,
      free
      from all liens and claims of mechanics, labors, materialmen and others for
      work
      done and materials furnished to Tenant and Tenant shall not create or suffer
      to
      be created any lien or encumbrance on the Premises.

        

                    All
      alterations,
      decorations, additions or improvements upon the Premises made by Tenant shall,
      unless Landlord elects otherwise, become the property of Landlord, and shall
      remain upon, and be
      surrendered with the Premises, as a part thereof, at the end of the Lease term,
      except that Landlord may, by written notice to Tenant, given at least thirty
      (30) days prior to the end of the Lease term, require Tenant to remove all
      improvements installed by Tenant, and Tenant shall repair or, at Landlord's
      option, pay to Landlord all costs arising from such removal.

     

                    All
      articles or
      personal property and all business and trade fixtures, machinery, and equipment,
      furniture and movable partitions owned by Tenant or installed by Tenant at
      its
      expense in the Premises, shall be and remain the property of Tenant and may
      be
      removed by Tenant at any time during the term of this Lease when Tenant is
      not
      in default hereunder. If Tenant shall fail to remove all of its effects from
      the
      Premises upon termination of this Lease for any cause whatsoever, Landlord
      may,
      at its option, remove the same in any manner that Landlord shall choose, and
      store said effects with liability to Tenant for loss thereof, and Tenant agrees
      to pay Landlord upon demand any and all expense incurred in such removal,
      including court costs and attorney’s fees and storage charges on such effects
      for any length of time that the same shall be in Landlord's possession, or
      Landlord may, at its option, without notice, sell said effects or any of the
      same, at private sale and without legal process, for such price as Landlord
      may
      obtain and apply the proceeds of such sale upon any amounts due under this
      lease
      from Tenant to Landlord and upon the expense incident to the removal of and
      sale
      of said effects.

     

    
      
        
        

      

      
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      	8.  	
              TENANT'S
                MAINTENANCE

            

    

     

                    Tenant
      has examined
      and inspected and knows the condition of the Premises and every part thereof
      and
      has received the same in good order and repair and accepts the same in its
      present condition. Tenant shall, at Tenant's sole cost and expense keep the
      Premises and every part thereof, including, but not limited to, all Tenant's
      personal property, storefronts, plate glass, signs, windows, heating and air
      condition systems in good condition and repair, damage thereto from causes
      beyond the reasonable control of Tenant and ordinary wear and tear excepted.
      Tenant shall, upon the expiration or sooner termination of the hereof, surrender
      the Premises to Landlord as improved by Tenant, ordinary wear and tear
      excepted.

     

                    If,
      at any time,
      Premises shall fall into disrepair, Tenant shall have thirty (30) days from
      the
      date of receipt of written notice of such disrepair from Landlord to make the
      necessary repairs to place the Premises in good condition. If said repairs
      are
      not completed within said thirty (30) day period, Landlord may enter the
      Premises and begin to complete the necessary repairs and Tenant agrees to
      immediately reimburse Landlord for the cost of said repairs upon presentation
      by
      Landlord to Tenant a bill for said repairs.

     

                    Landlord
      shall have
      no obligation to maintain, alter, remodel, improve, repair, decorate or paint
      the Premises or any, part thereof and the parties hereto affirm that Landlord
      has made no representations to Tenant in respect of the condition of the
      Premises except as specifically set forth herein.

    

    
      	9.  	
              ALTERATIONS

            

    

    

                    Except
      as otherwise
      contained herein, Tenant shall not make any structural or exterior alterations
      to the Premises without Landlord’s consent, Tenant may make nonstructural
      alterations to the interior of the Premises that Tenant requires in order to
      conduct its business on the Premises. In making any alterations that Tenant
      has
      a right to make, Tenant shall comply with the following:

     

                    A. Tenant
      shall submit to Landlord reasonably detailed final plans and specifications
      and
      working drawings of the proposed alterations and the name of its contractor
      at
      specifications least thirty (30) days before the date it intends to commence
      the
      alterations.

     

               B. The
      alterations shall not be commenced until two (2) days after Landlord has
      received notice from Tenant stating the date the installation of the alterations
      is to commence so that Landlord can post and record an appropriate Notice of
      Nonresponsibility.

     

    
      
        
        

      

      
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                    C. The
      alterations shall be approved by all appropriate governmental agencies, and
      all
      applicable permits and authorizations shall be obtained before commencement
      of
      the alterations.

    

    
      	10.  	
              UTILITIES
                AND SERVICES

            

    

    

    A. Other
      than specific utilities contracted for directly by Tenant, including without
      limitation telephone services, Landlord shall pay for all utilities and services
      furnished to or used by Tenant including, without limitation, electricity,
      natural gas, and water for the Premises and all connection charges or other
      charges related thereto. Tenant shall pay to Landlord a utility reimbursement
      amount in the sum of Two Hundred Sixty-three Dollars and Ninety-four Cents
      $263.94 per month. On July 1 of any year of the term and any Extended Term
      of
      this Lease, Landlord shall have the right to increase the monthly utility
      reimbursement amount and Tenant agrees to pay such increased amount to
      Landlord.

    

    B. If,
      at
      Landlord’s sole cost and expense, Landlord elects to install a separate
      electrical meter for the Premises, then Tenant shall become solely responsible
      to contract and pay for electrical service to the Premises with a private
      electrical services provider. In the event that Landlord installs a separate
      electrical meter for the Premises and Tenant contracts with and pays for
      electrical service from a private electrical services provider the utility
      reimbursement shall be reduced to take into account the electrical service
      paid
      for by Tenant. On July 1 during any year of the Term or Extended Term of this
      Lease, Landlord shall have the right to increase the monthly reduced utility
      amount identified in this subparagraph 9B, and Tenant agrees to pay such
      increased amount to Landlord. 

    

    
      	11.  	
              INSURANCE

            

    

    

    
      	A.  	
              Fire
                Insurance

            

    

    

    1.  For
      Personal Property.
      Tenant,
      at its sole cost and expense, shall maintain on all its personal property,
      Tenant's improvements, and alterations in, on or about the Premises, a policy
      of
      standard fire and extended coverage insurance, with vandalism and malicious
      mischief endorsements, to the extent of at least One Hundred Percent (100%)
      of
      their full replacement value. The proceeds from any such policy shall be used
      by
      Tenant for the replacement of personal property and the restoration of Tenant's
      improvements or alterations.

    

    2.  Definition
      of "Full Replacement Value".
      The
      "Full Replacement Value" of Tenant's personal property, improvements and
      alterations, shall be determined by the company issuing the fire insurance
      policies at the time said policies are initially obtained. Not more frequently
      than once every three (3) years, either party shall have the right to notify
      the
      other party that it elects to have the replacement value redetermined by an
      insurance company. The redetermination shall be made promptly and in accordance
      with the rules and practices of the Board of Fire Underwriters, or a like board
      recognized and generally accepted by the insurance company, and each party
      shall
      be promptly notified of the results by the company. The insurance policy shall
      be adjusted according to the redetermination.

     

    
      
        
        

      

      
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    B. General
      Comprehensive Liability Insurance:

    

    1.
      General
      Comprehensive Liability Insurance for Tenant's Premises.
      At all
      times during the term of this Lease or any extension thereof, Tenant shall
      maintain general comprehensive liability insurance, including products liability
      insurance with such limits as it deems necessary but not less than ONE MILLION
      DOLLARS ($1,000.000.00) for injury or death to one person; ONE MILLION DOLLARS
      (1,000,000.00) for injury or death to more than one person; and ONE MILLION
      DOLLARS ($1,000,000.00) against claims of third persons for property damage.
      Said insurance shall cover the Premises leased by Tenant as defined
      herein.

    

    Said
      insurance shall insure performance by Tenant of the indemnity provisions of
      this
      Lease. Landlord, its officers, officials, employees, agents and representatives,
      shall be named as a coinsured, and the provisions of such insurance shall
      contain cross-liability endorsements.

    

    C. General
      Insurance Provisions:

    

    (a) Subrogation
      Waiver.
      Tenant shall cause insurance carrier to provide a waiver of all rights of
      recovery by way of subrogation against Landlord in connection with any damage
      covered by said insurance. Landlord shall not be liable to Tenant for any damage
      caused by fire or any of the risks insured against under any insurance required
      by this Lease.

    

    (b) Proof
      of Coverage.
      Tenant
      shall give Landlord written verification that its insurance satisfies all of
      Tenant's insurance requirements as set forth in this Lease and will remain
      in
      existence for the entire term of this Lease or any extension
      thereof.

    

    (c) Protection
      Against Cancellation.
      Written
      proof must also be given by Tenant that the insurance provided for in this
      section expressly provides that it shall not be canceled or altered without
      thirty (30) days prior written notice to Landlord.

    

    (d) Failure
      to Secure.
      If
      Tenant, at any time during the term of this Lease or any extension thereof,
      should fail to secure or maintain the foregoing insurance, Landlord shall be
      permitted to obtain such insurance in Tenant's name or as the agent of Tenant
      and shall be compensated by Tenant for the cost of the insurance premiums.
      Tenant shall pay Landlord interest on paid insurance premiums at the rate of
      Ten
      Percent (10%) per annum computed from the date written notice is received that
      the premiums have been paid.

    

    (e) As
      Between the Parties Hereto.
      The
      parties release each other, and their respective authorized representatives,
      from any claims for damage to any person or to the Premises, and to the
      fixtures, personal property, Tenant's improvements, and alterations of either
      Landlord or Tenant in or on the Premises that are caused by or result from
      risks
      insured against under any insurance policies carried by the parties and in
      force
      at the time of any such damage.

    

    
      
        
        

      

      
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      	12.  	
              DAMAGE
                OR DESTRUCTION OF BUILDING OR
                PREMISES

            

    

    

    If,
      during the term of this Lease or any extension thereof, the Premises or
      Courthouse Building are damaged or totally or partially destroyed, Landlord
      in
      its sole and absolute discretion, may either restore the Premises and/or
      Courthouse Building or terminate this Lease. If Landlord elects to repair or
      restore such damage, this Lease shall continue in full force and effect, but
      the
      rent will be proportionately reduced based upon the extent, if any, to which
      the
      damage interferes with the business carried on by Tenant. If Landlord elects
      not
      to repair or restore such damage, Landlord may give notice to Tenant at any
      time
      within thirty (30) days after such damage, terminating this Lease as of the
      date
      specified in such notice, which date shall be not less than thirty (30) days
      nor
      more than sixty (60) days after giving of such notice. In the event of giving
      of
      such notice, this Lease shall expire and all interest of Tenant in the Premises
      shall terminate on the date so specified in such notice and the rent, reduced
      by
      any proportionate reduction, based upon the extent, if any, to which the damage
      interfered with the business carried on by Tenant in the Premises, shall be
      paid
      up to date of such termination.

    

    Landlord
      shall not be required to repair any injury or damage by fire or other cause,
      or
      to make any repairs or replacements of any panels, decoration, office fixtures,
      railings, ceiling, floor coverings, partitions, or any other property or
      improvements installed in the Premises by Tenant.

    

    The
      provisions of Section 1932, Subdivision 2, and Section 1933, Subdivision 4,
      of
      the Civil Code of the State of California are hereby waived by
      Tenant.

    

    
      	13.  	
              INDEMNITY

            

    

    

    A. No
      Liability of Landlord:

    

    Landlord
      shall not be liable to Tenant for any injury or damage that may result to any
      person or property by or from any cause whatsoever, and without limiting the
      generality of the foregoing whether caused by water leakage of any character
      from the room, walls or other portion of the Premises, or caused by gas, fire,
      oil, electricity, or any cause whatsoever, in, on, or about the Premises or
      any
      part thereof.

    

    B. Indemnification
      of Landlord:

    

    Tenant
      shall indemnify and hold harmless Landlord against and from any and all claims
      arising from Tenant's use of the Premises or the conduct of its business or
      from
      any activity, work or thing done, permitted or suffered by Tenant in or about
      the Premises, and shall further indemnify and hold harmless Landlord against
      and
      from any and all claims arising from any breach or default in the performance
      of
      any obligation on Tenant's part to be performed under the terms of this Lease,
      or arising from any act, neglect, fault or omission of Tenant, or of its agents,
      employees, representatives, customers, invitees or contractors, for any injury
      or damage to any person or property whatsoever occurring in, on, or about the
      Premises or any part thereof, and from and against all costs, attorneys' fees,
      expenses, liabilities, claims or any action or prosecution brought thereon.
      If
      any action or proceeding be brought against Landlord by reason of any such
      claims, Tenant, upon notice from Landlord, shall defend the same at Tenant's
      expense by counsel reasonably satisfactory to Landlord. Tenant, as a material
      part of the consideration to Landlord, hereby assumes all risk of damage to
      property or injury to persons in, upon, or about the Premises from any cause
      whatsoever. The provisions of this paragraph 12 B. shall survive the termination
      of this Lease.

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

    

    C. Damage
      to Tenant's Property:

    

    Notwithstanding
      anything above to the contrary, Landlord or its officials, officers, employees,
      representatives and agents shall not be liable for loss of or damage to any
      property by theft or otherwise, nor for any injury or damage to persons or
      property resulting from fire, explosion, falling plaster, steam, gas,
      electricity, water or rain which may leak from any part of the Premises or
      from
      the pipes, appliances or plumbing works therein or from the roof, street or
      subsurface or from any other place or resulting from dampness or any other
      cause
      whatsoever. Landlord, its officials, officers, employees, representatives,
      or
      its agents shall not be liable for any latent defect in the Premises or any
      building or improvements thereon. Tenant shall give prompt notice to Landlord
      in
      case of fire or accidents in the Premises or in the building located thereon
      or
      of defects therein.

    
      	14.  	
              ASSIGNMENT

            

    

    A. Prohibition
      Against Voluntary Assignment, Subletting and Encumbering 

    

    Tenant
      shall not voluntarily assign, mortgage, hypothecate or encumber its interest
      in
      this Lease or in the Premises, or sublease all or any part of the Premises,
      or
      allow any other person or entity (except Tenant's authorized representatives)
      to
      occupy or use all or any part of the Premises, without first obtaining
      Landlord's consent. Any assignment, encumbrance, or sublease without Landlord's
      consent, shall be voidable and at Landlord's election, shall constitute a
      default. Consent to any assignment, encumbrance or sublease shall not operate
      as
      a waiver of the necessity for a consent to any subsequent assignment or
      subletting, and at the terms of such consent shall be binding upon any person
      holding by, under, or through Tenant.

    

    If
      Tenant
      is a limited liability company or partnership, a withdrawal or change,
      voluntary, involuntary, or by operation of law of the persons or entities owning
      Fifty-One Percent (51%) or more of the entity or the dissolution of the entity,
      shall be deemed a voluntary assignment.

    If
      Tenant
      consists of more than one person, a purported assignment, voluntary, involuntary
      or by operation of law, from a majority of persons to the other shall be deemed
      a voluntary assignment. If Tenant is a corporation, any dissolution, merger,
      consolidation or other reorganization of Tenant, or the sale of other transfer
      of a controlling percentage of the capital stock of Tenant, or the sale of
      Fifty-One Percent (51%) of the value of the assets of Tenant, shall be deemed
      a
      voluntary assignment. The phrase "controlling percentage" means the ownership
      of, and the right to vote, stock possession at least Fifty-One Percent (51%)
      of
      the total combined voting power of all classes of Tenant's capital stock issued,
      outstanding and entitled to vote for the election of directors. This paragraph
      shall not apply to corporations the stock of which is traded through an exchange
      or over the counter.

     

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

    

    B. Involuntary
      Assignment:

    

    No
      interest of Tenant in this Lease shall be assignable by operation of law,
      (including without limitation, the transfer of this Lease by testacy or
      intestacy) without the consent of Landlord. Each of the following acts shall
      be
      considered an involuntary assignment:

    

    1. If
      Tenant
      is or becomes bankrupt or insolvent, makes an assignment for the benefit of
      creditors, or institutes a proceeding under one or more Chapters of the
      Bankruptcy Act, in which Tenant is the Bankrupt or a reorganizing debtor, or
      if
      Tenant is a partnership or consists of more than one person or entity, is or
      becomes bankrupt or a debtor in a Chapter proceeding, or insolvent, or makes
      an
      assignment to the benefit of creditors;

    

    2. If
      a writ
      of attachment or execution is levied on this Lease;

    

    3. If
      in any
      proceeding or action to which a Tenant is a party, a receiver is appointed
      with
      authority to take possession of the Premises.

    

    An
      involuntary assignment shall constitute a default by Tenant and Landlord shall
      have the right to elect to terminate this Lease, in which case this Lease shall
      not be treated as an asset of Tenant.

    

    In
      the
      event Tenant desires Landlord to provide written consent to the assignment
      by
      Tenant of Tenant's interest in the Lease, or the subletting the Premises or
      any
      part thereof to another person or entity, Tenant shall provide Landlord with
      a
      written request for consent and shall provide therewith information concerning
      the proposed assignee or sublessee, appropriate financial statements and such
      other information that the Landlord shall request. Landlord shall have the
      sole
      discretion as to whether or not to consent to any proposed assignment or
      sublease. In the event that the Premises are leased to more than one Tenant,
      this Lease shall automatically transfer to the survivor or survivors, in the
      event of death of one Tenant.

    

    
      	15.  	
              ENTRY
                BY LANDLORD

            

    

    

    Landlord
      and its authorized representative shall at any and all times have the right
      to
      enter the Premises to inspect the same, to submit said Premises to prospective
      purchasers or tenants, to post notices of nonresponsibility, for sale signs
      and
      for rent or for lease signs or during the time that Tenant is in default, to
      alter, improve, or repair the Premises or any other portion of the building,
      all
      without being deemed guilty of an eviction of Tenant and without abatement
      of
      rent, and may for that purpose erect scaffolding, protective barricades and
      other necessary structures where reasonably required by the character of the
      work to be performed, providing that the business of Tenant shall be interfered
      with as little as is reasonably practicable. Tenant hereby waivers any claim
      for
      damages for any injury or inconvenience to or interference with Tenant's
      business, any loss of occupancy or quiet enjoyment of the Premises, and any
      other loss occasioned thereby. For each of the aforesaid purposes, Landlord
      shall at all times have and retain a key with which to unlock all of the doors
      in, upon, and about the Premises, excluding Tenant's vaults and safes, and
      Landlord shall have the right to use any and all means which Landlord may deem
      proper to open said door in an emergency in order to obtain entry to the
      Premises, and any entry to the Premises obtained by Landlord by any of said
      means, or otherwise, shall not under any circumstances be construed or deemed
      to
      be a forcible or unlawful entry into, or a detainer of, the Premises, or an
      eviction of Tenant from the Premises or any portion thereof, and any damages
      caused on account thereof shall be paid by Tenant. It is understood and agreed
      that no provision of the within Lease shall be constructed as an obligation
      Landlord to perform any repairs, alterations or decorations except as otherwise
      expressly agreed herein to be performed by Landlord.

     

    
      
        
        

      

      
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      	16.  	
              DEFAULT
                AND REMEDIES

            

    

    

    A. Acts
      Constituting a Default:

    

    Any
      and
      all of the following actions shall constitute default of this
      Lease:

    

    1. Use
      of
      the Premises for any purpose other than as authorized in this
      Lease;

    

    2. The
      abandonment of the Premises by Tenant. Abandonment is herein defined to include,
      but is not limited to, any absence by Tenant from the Premises for five (5)
      business days or longer during the term of this Lease or while in default of
      any
      provisions of this Lease;

    

    3. The
      failure by Tenant to make any payment of rent required to be made by Tenant
      hereunder, as and when due, where such failure shall continue for a period
      of
      three (3) days after written notice thereof from Landlord to Tenant; provided,
      however, that any such written notice shall be in lieu of, and not in addition
      to, any notice required under California Code of Civil Procedure, Section
      1161;

    

    4. The
      failure by Tenant to observe or perform any of the express or implied covenants
      or provisions of this Lease to be observed or performed by Tenant, other than
      as
      specified in 2. or 3. above, where such failure shall continue for a period
      of
      ten (10) days after written notice thereof from Landlord to Tenant; provided,
      however, that any such notice shall be in lieu of, and not in addition to,
      any
      notice required under California Code of Civil Procedure, Section 1161; provided
      further, that if the nature of Tenant's default is such that more than ten
      (10)
      days are reasonably required for its cure, then Tenant shall not be deemed
      to be
      in default if Tenant shall commence such cure within said ten (10) day period
      and thereafter diligently prosecute such cure to completion;

     

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

    

    5. (i)
      The
      making by Tenant of any general assignment for the benefit of creditors; (ii)
      the filing by or against Tenant of a petition to have Tenant adjudged bankrupt
      or a petition for reorganization or arrangement under any law relating to
      bankruptcy (unless, in the case of a petition filed against Tenant, the same
      is
      dismissed within thirty (30) days; (iii) the appointment of a trustee or
      receiver to take possession of substantially all of Tenant's assets located
      at
      the Premises or of Tenant's interest in this Lease, where possession is not
      restored to Tenant within thirty (30) days; or (iv) the attachment, execution
      or
      other judicial seizure of substantially all of Tenant's assets located at the
      Premises or of Tenant's interest in this Lease, where such seizure is not
      discharged within thirty (30) days.

    

    6. Assignment
      of the Premises by Tenant, either voluntarily or by operation of law, whether
      by
      judgment, executions, death, or any other means, without the consent of
      Landlord; and

    

    B. Remedies:

    

    Landlord
      shall have the following remedies if Tenant commits a default. These remedies
      are not exclusive, but are cumulative and in addition to any remedies now or
      hereafter allowed by law or elsewhere provided.

    

    1. Tenant's
      Right to Possession Not Terminated.
      Landlord can continue this Lease in full force and effect, and the Lease will
      continue in effect as long as Landlord does not terminate Tenant's right to
      possession, and Landlord shall have the right to collect rent when due. During
      the period Tenant is in default, Landlord can enter the Premises and relet
      them,
      or any part of them, to third parties for Tenant's account. Tenant shall be
      liable immediately to Landlord for all costs Landlord incurs in reletting the
      Premises, including, without limitation, broker's commission, expenses of
      remodeling the Premises required by the reletting, and like costs. Reletting
      can
      be for a period shorter or longer than the remaining term of this Lease. Tenant
      shall pay to Landlord the rent due under this Lease on the dates the rent is
      due, less the rent Landlord received from any reletting. No act by Landlord
      allowed by this paragraph shall terminate or cause a forfeiture of this Lease
      unless Landlord notifies Tenant that Landlord elects to terminate and forfeit
      this Lease.

    

    2. Termination
      of Tenant's Right to Possession.
      Landlord can terminate Tenant's right to possession of the Premises at any
      time.
      No act by Landlord other than giving notice to Tenant shall terminate or cause
      a
      forfeiture of this Lease. Acts of maintenance, efforts to relet the Premises
      or
      the appointment of a receiver on Landlord's initiative to protect Landlord’s
      interest under this Lease shall not constitute a termination of Tenant's right
      to possession. On termination, Landlord has the right to recover from
      Tenant:

    

    a. The
      worth, at the time of the award of the unpaid rent that had been earned at
      the
      time of termination of this Lease;

    

    b. The
      worth, at the time of the award of the amount by which the unpaid rent that
      would have been earned after the date of termination of this Lease until the
      time' of award exceeds that amount of the loss of rent that Tenant proves could
      have been reasonably avoided;

     

    
      
        
        

      

      
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    c. The
      worth, at the time of the award of the amount by which the unpaid rent for
      the
      balance of the term after the time of award exceeds that amount of the loss
      of
      rent Tenant proves could have been reasonably avoided; and

    

    d. Any
      other
      amount, and court costs, necessary to compensate Landlord for all detriment
      proximately caused by Tenant's default of this Lease or which in the ordinary
      course of things, would be likely to result therefrom.

    

    "The
      worth at the time of the award" as used in a., b. and c. of this paragraph,
      is
      to be computed by allowing interest at the rate of Ten Percent (10%) per annum
      or the maximum amount allowed by law, whichever is greater. "The worth, at
      the
      time of the award", as referred to in c. of this paragraph, is to be computed
      by
      discounting the amount at the discount of the Federal Reserve Bank of San
      Francisco at the time of award, plus One Percent

    

    3. Appointment
      of Receiver.
      If
      Tenant is in default of this Lease, Landlord shall have the right to have a
      receiver appointed to collect rent and conduct Tenant's business. Neither the
      filing of a petition for the appointment of a receiver nor the appointment
      itself shall constitute an election by Landlord to terminate or forfeit this
      Lease.

    

    4. Removal
      of Property.
      Where
      personal property of the Tenant remains on the Premises after the tenancy has
      been terminated, for whatever reason, and the Premises have been vacated by
      the
      Tenant, the Landlord shall give written notice to such Tenant in accordance
      with
      the language of California Civil Code Sections 1983 through 1985, inclusive.
      The
      notice shall advise the person to be notified that said personal property must
      be claimed within fifteen (15) days from the date of personal delivery of said
      notice or within eighteen (18) days after the date said notice is deposited
      in
      the mail.

    

    During
      the notice period, Landlord may store said personal property in a place of
      safekeeping pursuant to the language of California Civil Code Section 1986.
      Tenant shall pay to Landlord the reasonable cost of storage of said personal
      property before Landlord is obligated to release said personal property to
      Tenant.

    

    If
      said
      personal property is not claimed and released within the abovementioned fifteen
      (15) days or eighteen (18) day period, then, pursuant to the language of
      California Civil Code Section 1988, Landlord may either retain said personal
      property, or sell said personal property at a public sale.

    

    5. Landlord's
      Right to Cure Tenant's Default.
      Upon ten
      (10) days prior written notice to Tenant,
      Landlord may cure any default by Tenant at Tenant's cost and may enter upon
      the
      Premises for such purpose. If Landlord, at any time by reason of Tenant's
      default, pays any sum or does any act that requires the payment of any sum,
      the
      sum paid by Landlord shall be due immediately from Tenant to Landlord at the
      time the sum is paid, and if paid at a later date, shall bear interest at the
      rate of Ten Percent (10%) per annum or the maximum amount allowed by law from
      the date the sum is paid by Landlord until Landlord is reimbursed by Tenant.
      The
      sum together with interest on it shall be additional rent.

     

    
      
        
        

      

      
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    C. Interest
      on Unpaid Rent:

    

    Rent
      and
      other amounts not paid when due shall bear interest at the rate of Ten Percent
      (10%) per annum or the maximum amount allowed by law from the date due until
      paid.

    

    D. Tenant's
      Right to Cure Landlord's Default:

    

    Landlord
      shall be in default of this Lease if it fails or refuses to perform any
      provision of this Lease that it is obligated to perform if the failure to
      perform is not cured within thirty (30) days after written notice of the default
      has been given by Tenant to Landlord.

    

    If
      the
      default cannot be reasonably cured within thirty (30) days, Landlord shall
      not
      be in default of this Lease if Landlord commences to cure the default within
      thirty (30) days, and diligently and in good faith continues to cure the
      default.

    

    Tenant,
      at any time after Landlord commits a default, can cure the default at Landlord’s
      cost. If Tenant, at any time, by reason of Landlord’s default, pays any sum or
      does any act that requires the payment of any sum, the sum paid by Tenant shall
      be due immediately from Landlord to Tenant at the time the sum is
      paid.

    

    E. Waiver
      of Damages.
      Tenant
      hereby waives all claims for damages that may be caused by Landlord's default
      under any provision of this Lease, re-entering and taking possession of the
      Premises or removing and storing furniture and property, as herein provided,
      and
      will save Landlord harmless from loss, costs or damages occasioned thereby,
      and
      no such re-entry shall be considered or construed to be a forcible entry as
      the
      same is defined in the Code of Civil Procedure of the State of
      California.

    

    
      	17.  	
              Environmental
                Matters.

            

    

    

    A. Compliance
      with Environmental Law.
      Tenant
      shall at all times and in all respects comply with all
      federal, state and local laws, ordinances and regulations (collectively
      "Hazardous Materials Laws")
      relating to industrial hygiene, environmental protection or the use, analysis,
      generation, manufacture, storage, disposal, or transportation of any hazardous,
      toxic, contaminated or polluting materials, substances or wastes, including
      without limitation, any "hazardous substances", "hazardous waste", "hazardous
      materials", "toxic substances" or "petroleum products" (collectively "Hazardous
      Materials").

     

    
      
        
        

      

      
        19

        
          

        

      

      
        
        

      

    

    

    B. Hazardous
      Materials Handling.
      Tenant
      shall at its own costs, procure and maintain in effect during the entire term
      of
      this Lease or any extension thereof, and comply with all conditions of any
      and
      all permits, licenses or governmental and regulatory approvals required for
      Tenant's use, analysis, generation, manufacture, storage, disposal or
      transportation of the Hazardous Materials on the Premises. Tenant shall cause
      any and all Hazardous Materials removed from the Premises to be removed and
      transported solely by duly licensed haulers to duly licensed facilities for
      final disposal of such materials and waste. Tenant shall in all respects use,
      handle, treat, deal and manage any and all Hazardous Materials in, on, under
      or
      about the Premises in total conformity with all applicable Hazardous Materials
      Laws and pursuant to prudent industry practices. Upon expiration or earlier
      termination of the term of this Lease or any extension thereof, Tenant shall
      cause all Hazardous Materials to be removed from the Premises and transported
      for use, storage or disposal in accordance and in compliance with all applicable
      Hazardous Materials Laws. Tenant shall not take any remedial action in response
      to the presence of any Hazardous Materials in, about or under the Premises
      or
      any building, or enter into any settlement agreement, consent decree or other
      compromise in respect to any claims relating to any Hazardous Materials in
      any
      way connected with the Premises, without first notifying Landlord of Tenant's
      intention to do so and affording Landlord ample opportunity to appear, intervene
      or otherwise appropriately assert and protect Landlord’s interest with respect
      thereto.

    

    C. Notices.
      Tenant
      shall immediately notify Landlord in writing of; (i) any enforcement, clean
      up,
      removal or other governmental or regulatory action instituted, completed or
      threatened pursuant to any Hazardous Materials Laws; (ii) any claim made or
      threatened by any person against Tenant or the Premises relating to damage,
      contribution, cost recovery compensation, loss or injury resulting from or
      claimed to result from any Hazardous Materials; and (iii) any reports made
      to
      any governmental agency arising out of or in connection with any Hazardous
      Materials used or stored upon or removed from the Premises, including any
      complaints, notices, warnings or asserted violations in connection therewith.
      Tenant shall also supply to Landlord as promptly as possible, and in any event
      within five (5) business days after Tenant first receives or sends the same,
      with copies of all claims, reports, complaints, notices, warnings or asserted
      violations relating in any way to the Premises or Tenant's use thereof. Upon
      Landlord's request, Tenant shall promptly deliver to Landlord copies of
      hazardous waste manifests reflecting the legal and proper use and disposal
      of
      all Hazardous Materials used or removed from the Premises.

    

    D. Indemnification
      of Landlord.
      Tenant
      shall indemnify, defend (by counsel reasonably acceptable to Landlord), protect
      and hold Landlord, its employees, agents, attorneys, successors, assigns,
      officials, officers, free and harmless from and against any and all claims,
      liabilities, penalties, forfeitures, losses or expenditures (including
      attorneys' fees) or death of or injury to any person or damage to any property
      whatsoever, arising from or caused in whole or in part, directly or indirectly,
      by (a) the presence in, on, upon or about the Premises or a discharge in or
      from
      the Premises of any Hazardous Materials or Tenant's use, analysis, storage,
      transportation, disposal, release, threatened release, discharge or generation
      of Hazardous Materials to, in, on, upon, about or from the Premises or (b)
      Tenant's failure to comply with any Hazardous Materials Law. Tenant's
      obligations hereunder shall include, without limitation, and whether foreseeable
      or unforeseeable, all costs of any required or necessary repair, clean up or
      detoxification or decontamination of the Premises, and the preparation and
      implementation of any closure, remedial action or other required plans in
      connection therewith, and shall survive the expiration or earlier termination
      of
      the term of this Lease or any extension thereof. For purposes of the release
      and
      indemnity provisions hereof, any acts or omissions of Tenant or its employees,
      agents, assignees, contractors, licensees or invitees of Tenant, or other acting
      for or on behalf of Tenant, whether or not they are negligent, intentional,
      willful or unlawful, shall be strictly attributable to Tenant. This
      indemnification shall survive the termination of this Lease.

     

    
      
        
        

      

      
        20

        
          

        

      

      
        
        

      

    

    

    
      	18.  	
              SIGNS,
                ADVERTISING

            

    

    

    A. Type
      of Signs Allowed:

    

    Tenant
      shall not have the right to place, construct or maintain on the glass panes
      or
      supports of the show windows of the Premises, the doors, or the exterior walls
      or roof of the building in which the Premises is located or any interior
      portions of the Premises, any signs, advertisements, names insignia, trademarks,
      descriptive material, or any other similar item without Landlord's prior written
      consent. All such signs must conform to the requirements of the Hanford
      Municipal Code. Landlord, at Tenant's cost, can remove any item placed,
      construed or maintained that does not comply with the provisions of this
      paragraph. Tenant agrees to keep its signs on the Premises in a good state
      of
      repair and to save the Landlord harmless from any loss or damage resulting
      from
      the erection, maintenance, existence, or removal of any of Tenant's
      signs.

    

    Tenant
      shall not, without Landlord's consent, place, construct or maintain on the
      Premises any advertisement media, including without limitation, searchlights,
      flashing lights, loudspeakers, phonographs or other similar visual or audio
      media.

     

             
B. Compliance
      with Laws:

    

    Any
      sign
      that Tenant has the right to place, construct and maintain shall comply with
      all
      laws, and Tenant shall obtain any approval required by such laws. Landlord
      makes
      no representation with respect to Tenant's ability to obtain such
      approval.

    

    
      	19.  	
              SUBORDINATION-ESTOPPEL

            

    

    

    This
      Lease is and shall be subordinate to any encumbrance now of record or recorded
      after the date of this Lease affecting the Premises, and land of which the
      Premises is a part.

    

    Such
      subordination is effective without any further act of Tenant. Tenant shall
      from
      time to time on request from Landlord execute and deliver any documents or
      instruments that may be required by a lender to effectuate any subordination.
      If
      Tenant fails to execute and deliver any such documents or instruments, Tenant
      irrevocably constitutes and appoints Landlord as Tenant's special
      attorney-in-fact to execute and deliver any such documents or
      instruments.

    

    
      
        
        

      

      
        21

        
          

        

      

      
        
        

      

    

     

    
      	20.  	
              NOTICE

            

    

    

    Except as
      otherwise expressly provided herein, any notice, consent, authorization or
      other
      communication to be given hereunder shall be in writing and shall be deemed
      duly
      given and received when delivered personally, when transmitted by facsimile
      or
      e-mail if receipt is acknowledged by the addressee, one business day after
      being
      deposited for next-day delivery with a nationally recognized overnight delivery
      service, or three business day after being mailed by first class mail, charges
      and postage prepaid, property addressed to the party to receive such notice
      at
      the last address furnished for such purpose by the party to whom notice is
      directed and addressed as follows:

    

    (a) In
      the
      case of Landlord:

    

    Deputy
      City Manager

    City
      of
      Hanford 

    319
      N.
      Douty Hanford, CA 93230 

    or
      such
      other address as Landlord may form time to time furnish to Tenant

    

    (b) In
      the
      case of Tenant:

    Keith
      Meeks

    Global
      Food Technologies 

    1161
      Campus Drive

    Hanford,
      CA 93230

    or
      such
      other addresses Tenant may form time to time furnish to Landlord

    

    If
      mailed, said notice shall be deemed properly given when deposited in
      the

    United
      States mail.

    

    
      	21.  	
              WAIVER
                OF BREACH

            

    

    

    Landlord's
      failure to take advantage of any default or breach of covenant on the part
      of
      Tenant shall not be, or be construed as a waiver thereof, nor shall any custom
      or practice which may grow up between the parties in the course of administering
      this Lease be construed to be a waiver or to lessen the right of Landlord to
      insist upon the performance by Tenant of any term, covenant, or condition
      hereof, or to exercise any rights given him on account of any such default.
      A
      waiver of a particular breach, or default, shall not be deemed to be a waiver
      of
      the same or any other subsequent breach or default.

    

    The
      receipt and acceptance by Landlord of delinquent rent shall not constitute
      a
      waiver of any default.

    

    No
      act or
      conduct of Landlord, including without limitation, the acceptance of the 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.

     

    
      
        
        

      

      
        22

        
          

        

      

      
        
        

      

    

    

    Landlord's
      consent to or approval of any act by Tenant requiring Landlord's consent or
      approval shall not be deemed to waiver or render unnecessary Landlord's consent
      to or approval of any subsequent act by Tenant.

    

    Any
      waiver by Landlord of any default must be in writing and shall not be a waiver
      of any other default concerning the same or any other provision of this
      Lease.

    

    
      	22.  	
              SALE
                OR TRANSFER OF PREMISES

            

    

    

    A. Effect
      on Lease:

    

    If
      Landlord sells or transfers all or any portion of the Premises, Landlord, on
      consummation of the sale or transfer, shall be released from any liability
      thereafter accruing under this Lease. If any security deposit or prepaid rent
      has been paid by Tenant, Landlord can transfer the security deposit or prepaid
      rent to Landlord's successor and on such transfer Landlord shall be discharged
      from any further liability in reference to the security deposit or prepaid
      rent.

    

    
      	23.  	
              ATTORNEY'S
                FEES

            

    

    

    Should
      either party hereto institute any legal action to enforce any provision thereof,
      the prevailing party in such action shall be entitled to receive from the losing
      party such amount as the court may adjudge to be reasonable attorney’s fees.
      Should Landlord be named as a defendant in any suit brought against Tenant
      in
      connection with or arising out of Tenant's occupancy hereunder, Tenant shall
      pay
      to Landlord its costs and expenses incurred in such suit, including reasonable
      attorney’s fees. With respect to any suit, action or proceeding arising out of
      or related to this Lease, Landlord and Tenant submit to the jurisdiction and
      venue of the Superior Court, in the County of Kings, State of California, for
      any proceeding arising thereunder.

    

    
      	24.  	
              ESTOPPEL
                CERTIFICATE

            

    

    

    Tenant
      shall, at any time and from time to time upon not less than ten (10) days prior
      written notice from Landlord, execute, acknowledge, and deliver to Landlord
      a
      statement in writing (i) certifying that this Lease is unmodified and in full
      force and effect (or if modified, stating the nature of such modification and
      certifying that this Lease as so modified, is in full force and effect) and
      the
      dates to which the rental and other charges are paid in advance, if any, and
      (ii) acknowledging that there are not, to Tenant's knowledge, any incurred
      defaults on the part of Landlord hereunder, or specifying such defaults, if
      any
      are claimed. Any such statement may be relied upon by any prospective purchaser
      or encumbrance of all or any portion of the real property of which the Premises
      are a part.

    

    Tenant's
      failure to deliver such statement within such time shall be conclusive upon
      Tenant (i) that this Lease is in full force and effect, without modification
      except as may be represented by Landlord, (ii) that there are no incurred
      defaults in Landlord's performance, and

    (iii)
      that not more than one (1) month's rental has been paid in advance.

     

    
      
        
        

      

      
        23

        
          

        

      

      
        
        

      

    

    

    
      	25.  	
              AGENCY

            

    

    

    Nothing,
      contained in this Lease shall be deemed or construed by the parties hereto
      or by
      any third person to create the relationship of principal and agent or of
      partnership or of joint venture or any other association other than Landlord
      and
      Tenant.

    

    
      	26.  	
              TERMS
                AND CAPTIONS

            

    

    

    The
      words
      "Landlord" and "Tenant," as used herein, shall include the plural as well as
      the
      singular. Words used in any gender include other genders. If there be more
      than
      one Tenant, the obligations hereunder imposed upon Tenant shall be joint and
      several. The article captions of this Lease are not a part of this Lease and
      shall have no effect upon the construction or interpretation of any part
      hereof.

    

    
      	27.  	
              TIME
                OF ESSENCE

            

    

    

    Time
      is
      of the essence in the performance of each provision of this Lease.

    

    
      	28.  	
              SUCCESSORS

            

    

    

    Subject
      to the provisions of paragraph 13 of this Lease, this Lease shall inure to
      the
      benefit of, and be binding upon, the successors and assigns of the parties
      hereto.

    

    
      	29.  	
              STATUS
                OF PARTIES ON TERMINATION OF
                LEASE

            

    

    

    Except
      as
      otherwise provided in this Lease, if a party elects to terminate this Lease
      as
      allowed herein, on the date this Lease terminates, the parties shall be released
      from further liabilities and obligations and Landlord shall return to Tenant
      any
      unearned rent, as long as Tenant is not in default on the date the Lease
      terminates.

    

    
      	30.  	
              PROVISIONS
                AND COVENANTS AND CONDITIONS

            

    

    

    All
      provisions, whether covenants or conditions, on the part of the Tenant shall
      be
      deemed to be both covenants and conditions.

    

    
      	31.  	
              INVALIDITY

            

    

    

    If
      any
      term, covenant, condition, or provision of this Lease is held by a court of
      competent jurisdiction to be invalid, void, or unenforceable, the remainder
      of
      the provisions hereof shall remain in full force and effect and shall in no
      way
      be affected, impaired, or invalidated thereby.

     

    
      
        
        

      

      
        24

        
          

        

      

      
        
        

      

    

     

    
      	32.  	
              PRIOR
                AGREEMENTS, AMENDMENTS

            

    

    

    This
      Lease contains all of the agreements of the parties hereto with respect to
      any
      matter covered or mentioned in this Lease, and no prior agreement or
      understanding pertaining to any such matter shall be effective for any purpose.
      No provision of this Lease may be amended or added to, except by an agreement
      in
      writing signed by the parties hereto or their respective successors in
      interest.

    

    
      	33.  	
              CONTROLLING
                LAW

            

    

    

    The
      validity, interpretation, and performance of this Lease shall be governed by
      the
      laws of the State of California.

     

    
      	
              IN
                WITNESS WHEREOF, the parties hereto have executed this Lease on the
                date
                first set forth above.

            
	 	 	 	 
	 “LANDLORD”	 	 	“TENANT”
	 	 	 	 
	
              CITY
                OF HANFORD

            	 	 	 
	 	 	 	 
	
              By:
                /s/ Thomas J Haglund

            	 	 	
              By:
                /s/ Keith Meeks

            
	
              

            	 	 	
              

            
	
              Thomas
                J. Haglund

              Deputy
                City Manager

            	 	 	
              Keith
                Meeks,

              President

            

    

     

     

    
 

    F:\WORD\4\4714.204\Global
      Foods Lease 053006.doc

     

    
      
        
        

      

      
        25EXHIBIT
      10.1

    

    
      	 	 	This
              space reserved for Recorders use only.
	This
              document was prepared by,
              and
                after recording, return to:

               

              Jill
                Ann Coleman

              Neal,
                Gerber & Eisenberg, LLP 

              2
                North LaSalle Street

              Suite
                2200

              Chicago,
                Illinois 60602

            	 	 

    

     

     

     

    Permanent
      Tax Index Number:

    
       

      ________________________

       

    

    
    

    Property
      Address:

     

    6
      Rubber
      Avenue

    Naugatuck,
      Connecticut 06770

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

    

    OPEN
      END MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, SECURITY AGREEMENT AND FIXTURE
      FILING

     

    This
      OPEN
      END MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, SECURITY AGREEMENT AND FIXTURE
      FILING dated as of July 30, 2007 (the “Mortgage”), is executed by
GDC
      NAUGATUCK, INC., a
      Delaware corporation (the “Mortgagor”), having an address at 6 Rubber
      Avenue, Naugatuck, Connecticut 06770, to and for the benefit of ATLAS
      PARTNERS MORTGAGE INVESTORS, LLC,
      a
      Delaware limited liability company (the “Mortgagee”), having an address
      at 55 East Monroe Street, Suite 1890, Chicago, Illinois 60603.

     

    RECITALS:

     

    A. The
      Mortgagee has agreed to loan to the Mortgagor the principal amount of Four
      Million, Five Hundred Thousand and No/100 Dollars ($4,500,000.00) (the “Loan”).
      The Loan shall be evidenced by that certain Mortgage Note of even date herewith
      (as amended, restated or replaced from time to time, the “Note”), a copy of
      which is attached hereto as Exhibit D, executed by the Mortgagor and made
      payable to the order of the Mortgagee in the principal amount of the Loan and
      due on July 31, 2009 (the “Maturity Date”), except as such date may be extended
      pursuant to the terms of the Note or accelerated pursuant to the terms hereof,
      of the Note or of any other document or instrument now or hereafter given to
      evidence or secure the payment of the Note (the Note, together with such other
      documents, as amended, restated or replaced from time to time, being
      collectively referred to herein as the “Loan Documents”).

     

    B. A
      condition precedent to the Mortgagee’s extension of the Loan to the Mortgagor is
      the execution and delivery by the Mortgagor of this Mortgage.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    NOW,
      THEREFORE, for good and valuable consideration, the receipt and sufficiency
      of
      which hereby are acknowledged, the Mortgagor agrees as follows:

     

    AGREEMENTS:

     

    The
      Mortgagor hereby mortgages, grants, assigns, remises, releases, warrants and
      conveys to the Mortgagee, WITH MORTGAGE COVENANTS UPON THE STATUTORY CONDITION,
      its successors and assigns, and grants a security interest in, the Mortgagor’s
      following described property and all of the Mortgagor’s rights, title and
      interests therein (referred to collectively herein as the
“Premises”):

     

    (a) The
      real
      estate located in the County of New Haven, State of Connecticut and legally
      described on Exhibit “A” attached hereto and made a part hereof (the “Real
      Estate”);

     

    (b) All
      improvements of every nature whatsoever now or hereafter situated on the Real
      Estate, and all fixtures of every nature whatsoever now or hereafter owned
      by
      the Mortgagor and located on, attached to and used in the operation of the
      Real
      Estate or the improvements thereon, including all extensions, additions,
      improvements, betterments, renewals, substitutions and replacements to any
      of
      the foregoing and all of the right, title and interest of the Mortgagor in
      and
      to any fixtures together with the benefit of any deposits or payments now or
      hereafter made on such fixtures by the Mortgagor or on its behalf (the
“Improvements”);

     

    (c) All
      easements, rights of way, streets, ways, alleys, passages, sewer rights, waters,
      water courses, water rights and powers, and all estates, rights, titles,
      interests, privileges, tenements, hereditaments and appurtenances whatsoever,
      in
      any way now owned or hereafter acquired with respect to the Real Estate, and
      the
      reversions, remainders and rents thereof, and all the estate, right, title,
      interest, property, possession, claim and demand whatsoever, at law as well
      as
      in equity, of the Mortgagor of, in and to the same;

     

    (d) All
      rents, proceeds, escrows, security deposits, impounds, reserves, tax refunds
      and
      other rights to monies from the Premises and/or the businesses and operations
      conducted by the Mortgagor, if any, thereon, to be applied against the
      Indebtedness (as hereinafter defined) to the extent required by the terms of
      the
      Loan Documents; provided, however, that the Mortgagor, so long as no Event
      of
      Default (as hereinafter defined) has occurred and is continuing hereunder,
      may
      collect rent as it becomes due, but not more than one (1) month in advance
      thereof;

     

    (e) All
      interest of the Mortgagor in all leases now or hereafter on the Premises,
      whether written or oral (each, a “Lease”, and collectively, the “Leases”),
      together with all security therefor and all monies payable thereunder, subject,
      however, to the conditional permission hereinabove given to the Mortgagor to
      collect the rents under any such Lease;

     

    (f) All
      fixtures now or hereafter owned by the Mortgagor and forming a part of, attached
      to and used in connection with the Real Estate or the Improvements, including,
      but without limitation, all plant equipment, apparatus, machinery and fixtures
      of every kind and nature whatsoever attached to and used in the operation of
      the
      Improvements, and all renewals or replacements thereof or articles in
      substitution therefor (the “Building Systems”), it being mutually agreed that
      all of the aforesaid property owned by the Mortgagor, so far as permitted by
      law, shall be deemed to be fixtures, a part of the realty, and security for
      the
      Indebtedness;

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    (g) All
      proceeds of the foregoing, including, without limitation, all judgments, awards
      of damages and settlements hereafter made resulting from condemnation
      proceedings or the taking of the Premises or any portion thereof under the
      power
      of eminent domain, any proceeds of any policies of insurance maintained with
      respect to the Premises or proceeds of any sale, option or contract to sell
      the
      Premises or any portion thereof.

     

    TO
      HAVE
      AND TO HOLD the Premises, unto the Mortgagee, its successors and assigns,
      forever, for the purposes and upon the uses herein set forth together with
      all
      right to possession of the Premises after the occurrence of any Event of Default
      which is continuing; the Mortgagor hereby RELEASING AND WAIVING all rights
      under
      and by virtue of the homestead exemption laws of the State of
      Connecticut.

     

    FOR
      THE
      PURPOSE OF SECURING: (i) the payment of the Loan and all interest, late
      charges, prepayment premium, if any, exit fee, if any, reimbursement obligations
      and other indebtedness evidenced by or owing under the Note or any of the other
      Loan Documents, together with any extensions, modifications, renewals or
      refinancings of any of the foregoing; (ii) the performance and observance
      of the covenants, conditions, agreements, representations, warranties and other
      liabilities and obligations of the Mortgagor or any other obligor to or
      benefiting the Mortgagee which are evidenced or secured by or otherwise provided
      in the Note, this Mortgage or any of the other Loan Documents; and
      (iii) the reimbursement to the Mortgagee of any and all sums incurred,
      expended or advanced by the Mortgagee pursuant to any term or provision of
      or
      constituting additional indebtedness under or secured by this Mortgage or any
      of
      the other Loan Documents, with interest thereon as provided herein or therein
      (collectively, the “Indebtedness”).

     

    Provided
      always that, if the Indebtedness shall be paid and performed according to the
      terms and conditions of this Mortgage and the other Loan Documents, then this
      Mortgage and the lien and estate hereby granted shall cease, terminate and
      be
      void.

     

    IT
      IS
      FURTHER UNDERSTOOD AND AGREED THAT:

     

    1. Title.
      

     

    The
      Mortgagor represents, warrants and covenants that (a) the Mortgagor is the
      holder of the fee simple title to the Premises, free and clear of all liens
      and
      encumbrances, except those liens and encumbrances in favor of the Mortgagee
      and
      as otherwise described on Exhibit ”B” attached hereto and made a part
      hereof (the “Permitted Exceptions”); and (b) the Mortgagor has legal power
      and authority to mortgage and convey the Premises.

     

    2. Maintenance,
      Repair, Restoration, Prior Liens, Parking. 

     

    The
      Mortgagor covenants that, so long as any portion of the Indebtedness remains
      unpaid, the Mortgagor will:

     

    (a) promptly
      repair, restore or rebuild any useful Improvements now or hereafter on the
      Premises which hereafter may become damaged or destroyed to a condition
      substantially similar to the condition immediately prior to such damage or
      destruction, whether or not proceeds of insurance are available or sufficient
      for the purpose, provided that the Mortgagor shall not hereby be required to
      repair any existing condition or defect in the Improvements or Building
      Systems;

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    (b) keep
      the
      Premises in operating condition and repair, without waste, and free from
      mechanics’, materialmen’s or like liens or claims or other liens or claims for
      lien (subject to the Mortgagor’s right to contest liens as permitted by the
      terms of Section 28
      hereof) , provided that the Mortgagor shall not hereby be required to repair
      any
      existing condition or defect in the Improvements or Building
      Systems;

     

    (c) pay
      when
      due the Indebtedness in accordance with the terms of the Note and the other
      Loan
      Documents and duly perform and observe all of the terms, covenants and
      conditions to be observed and performed by the Mortgagor under the Note, this
      Mortgage and the other Loan Documents;

     

    (d) pay
      when
      due any indebtedness which may be secured by a Permitted Exception or other
      charge on the Premises on a parity with, superior to or inferior to the lien
      hereof (other than the Subordinate Indebtedness, as such term is defined in
      that
      certain Subordination and Intercreditor Agreement dated as of even date (the
      “Subordination and Intercreditor Agreement”) among Howard S. Modlin, John
      L. Segall and the Mortgagee, which Subordinate Indebtedness shall be paid by
      the
      Mortgagor, or payment thereon deferred, only in accordance with the terms of
      the
      Subordination and Intercreditor Agreement), and upon request exhibit
      satisfactory evidence of the discharge of such lien to the Mortgagee (subject
      to
      the Mortgagor’s right to contest liens as permitted by the terms of
      Section 28 hereof);

     

    (e) complete
      within a reasonable time any Improvements now or at any time in the process
      of
      erection upon the Premises;

     

    (f) comply
      in
      all material respects with all requirements of law, municipal ordinances or
      restrictions and covenants of record with respect to the Premises and the use
      thereof;

     

    (g) obtain
      and maintain in full force and effect, and abide by and satisfy the material
      terms and conditions of, all material permits, licenses, registrations and
      other
      authorizations with or granted by any governmental authorities that may be
      required from time to time with respect to the performance of its obligations
      under this Mortgage;

     

    (h) make
      no
      material alterations in the Premises or demolish any material portion of the
      Premises without the Mortgagee’s prior written consent, except as required by
      law or municipal ordinance;

     

    (i) suffer
      or
      permit no material change in the use or general nature of the occupancy of
      the
      Premises, without the Mortgagee’s prior written consent;

     

    (j) pay
      when
      due all operating costs of the Premises;

     

    (k) not
      initiate or acquiesce in any zoning reclassification with respect to the
      Premises, without the Mortgagee’s prior written consent;

     

    (l) provide
      and thereafter maintain the existing parking areas for the Premises as may
      be
      required by law, ordinance or regulation (whichever may be greater), together
      with any driveways and other areas for ingress, egress and right-of-way to
      and
      from the adjacent public thoroughfares necessary for the use thereof;
      and

     

    
      
        
        

      

      
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    (m) comply,
      and cause the Premises at all times to be operated in compliance, in all
      material respects with all applicable federal, state, local and municipal
      environmental, health and safety laws, statutes, ordinances, rules and
      regulations.

     

    3. Payment
      of Taxes and Assessments. 

     

    The
      Mortgagor will pay when due and before any penalty attaches, all general and
      special taxes, assessments, water charges, sewer charges, and other fees, taxes,
      charges and assessments of every kind and nature whatsoever (all herein
      generally called “Taxes”), whether or not assessed against the Mortgagor, if
      applicable to the Premises or any interest therein, subject to the Mortgagor’s
      right to contest the same, as provided by the terms hereof; and the Mortgagor
      will, upon written request, furnish to the Mortgagee duplicate receipts therefor
      within ten (10) days after the Mortgagee’s request.

     

    4. Tax
      Deposits. 

     

    The
      Mortgagor shall deposit with the Mortgagee, on the first day of each month
      until
      the Indebtedness is fully paid, a sum equal to one-twelfth (1/12th) of one
      hundred five percent (105.00%) of the most recent ascertainable annual Taxes
      on
      the Premises. Such deposits are to be held without
      any allowance of interest and are to be used for the payment of Taxes next
      due
      and payable when they become due. To the extent such deposits are sufficient
      to
      do so, the Mortgagee shall pay such Taxes when the same become due and payable
      (upon submission of appropriate bills therefor from the Mortgagor) or shall
      release sufficient funds to the Mortgagor for the payment thereof. If the funds
      so deposited are insufficient to pay any such Taxes for any year (or
      installments thereof, as applicable) when the same shall become due and payable,
      the Mortgagor shall, within ten (10) days after receipt of written demand
      therefor, deposit additional funds as may be necessary to pay such Taxes in
      full. If the funds so deposited exceed the amount required to pay such Taxes
      for
      any year, the excess shall be applied toward subsequent deposits. Said deposits
      shall be kept separate and apart from any other funds of the Mortgagee. The
      Mortgagee, in making any payment hereby authorized relating to Taxes, may
      do so according to any bill, statement or estimate procured from the appropriate
      public office without inquiry into the accuracy of such bill, statement or
      estimate or into the validity of any tax, assessment, sale, forfeiture, tax
      lien
      or title or claim thereof.

     

    5. Mortgagee’s
      Interest In and Use of Deposits. 

     

    The
      deposits made pursuant to Section 4 hereof are hereby pledged as additional
      security for the Indebtedness and shall not be subject to the direction or
      control of the Mortgagor. When the Indebtedness has been fully paid, any
      remaining deposits shall be returned to the Mortgagor. The Mortgagee shall
      not
      be liable for any failure to apply to the payment of Taxes any amount so
      deposited unless the Mortgagor, prior to an Event of Default, shall have
      requested the Mortgagee in writing to make application of such funds to the
      payment of such amounts, accompanied by the bills for such Taxes. The Mortgagee
      shall not be liable for any act or omission taken in good faith or pursuant
      to
      the instruction of any party.

     

    6. Insurance.

     

    (a) The
      Mortgagor shall at all times keep all Improvements now or hereafter situated
      on
      the Premises insured against loss or damage by fire and such other hazards
      as
      may reasonably be required by the Mortgagee, under insurance policies with
      terms, coverages and provisions substantively identical to the Mortgagor’s
      existing insurance policies which are described on Exhibit C attached
      hereto and made a part hereof. Unless the Mortgagor provides the Mortgagee
      evidence of the insurance coverages required hereunder, the Mortgagee may
      purchase insurance at the Mortgagor’s expense to cover the Mortgagee’s interest
      in the Premises. The insurance may, but need not, protect the Mortgagor’s
      interest. The coverages that the Mortgagee purchases may not pay any claim
      that
      the Mortgagor makes or any claim that is made against the Mortgagor in
      connection with the Premises. The Mortgagor may later cancel any insurance
      purchased by the Mortgagee, but only after providing the Mortgagee with evidence
      that the Mortgagor has obtained insurance as required by this Mortgage. If
      the
      Mortgagee so purchases insurance for the Premises, the Mortgagor will be
      responsible for the costs of such insurance, until the effective date of the
      cancellation or expiration of the insurance. The costs of the insurance may
      be
      added to the Indebtedness. The cost of the insurance may be more than the cost
      of insurance the Mortgagor may be able to obtain on its own.

     

    
      
        
        

      

      
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    (b) The
      Mortgagor shall not take out separate insurance concurrent in form or
      contributing in the event of loss with that required to be maintained hereunder
      unless the Mortgagee is included thereon as the loss payee or an additional
      insured as applicable, under a standard mortgage clause acceptable to the
      Mortgagee and such separate insurance is otherwise acceptable to the
      Mortgagee.

     

    (c) In
      the
      event of loss, the Mortgagor shall give prompt notice thereof to the Mortgagee,
      who, if such loss exceeds Seven Hundred Fifty Thousand and No/100 Dollars
      ($750,000.00) (the “Threshold”), shall have the sole and absolute right
      to make proof of loss. If such loss exceeds the Threshold or if such loss is
      equal to or less than the Threshold and the conditions set forth in clauses
      (i),
      (ii) and (iii) of the immediately succeeding subsection are not
      satisfied, then the Mortgagee, solely and directly shall receive such payment
      for loss from each insurance company concerned. If and only if (i) such
      loss is equal to or less than the Threshold, (ii) no Event of Default or
      event that with the passage of time, the giving of notice or both would
      constitute an Event of Default then exists, and (iii) the total of the
      insurance proceeds and such additional amounts placed on deposit with the
      Mortgagee by the Mortgagor for the specific purpose of rebuilding or restoring
      the Improvements equals or exceeds the reasonable costs of such rebuilding
      or
      restoration, then the Mortgagee shall endorse to the Mortgagor any such payment
      and the Mortgagor may collect such payment directly. Subject to the preceding
      sentence, the Mortgagee shall have the right, at its option and in its sole
      discretion, to apply any insurance proceeds received by the Mortgagee pursuant
      to the terms of this section, after the payment of all of the Mortgagee’s
      expenses, either (i) on account of the Indebtedness, irrespective of
      whether such principal balance is then due and payable, whereupon the Mortgagee
      may declare the whole of the balance of Indebtedness to be due and payable,
      or
      (ii) to the restoration or repair of the property damaged as provided in
      subsection (d) below; provided, however, that the Mortgagee hereby agrees
      to permit the application of such proceeds to the restoration or repair of
      the
      damaged property, subject to the provisions of subsection (d) below, if no
      Event of Default, or event that with the passage of time, the giving of notice
      or both would constitute an Event of Default, then exists. If insurance proceeds
      are made available to the Mortgagor by the Mortgagee as hereinafter provided,
      the Mortgagor shall repair, restore or rebuild the damaged or destroyed portion
      of the Premises so that the condition and value of the Premises are
      substantially the same as the condition and value of the Premises prior to
      being
      damaged or destroyed. Any insurance proceeds applied on account of the unpaid
      principal balance of the Note shall, to the extent resulting in a prepayment,
      be
      subject to the provisions with respect to prepayment set forth in the Note.
      In
      the event of foreclosure of this Mortgage, all right, title and interest of
      the
      Mortgagor in and to any insurance policies then in force shall pass to the
      purchaser at the foreclosure sale.

     

    
      
        
        

      

      
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    (d) If
      insurance proceeds are made available by the Mortgagee to the Mortgagor, the
      Mortgagor shall comply with the following conditions:

     

    (i) Before
      commencing to repair, restore or rebuild following damage to, or destruction
      of,
      all or a portion of the Premises, whether by fire or other casualty, the
      Mortgagor shall obtain from the Mortgagee its approval, not to be unreasonably
      withheld, of all site and building plans and specifications pertaining to such
      repair, restoration or rebuilding.

     

    (ii) Prior
      to
      each payment or application of any insurance proceeds to the repair or
      restoration of the Improvements upon the Premises to the extent permitted in
      subsection (c) above (which payment or application may be made, at the
      Mortgagee’s option, through an escrow, the terms and conditions of which are
      reasonably satisfactory to the Mortgagee and the cost of which is to be borne
      by
      the Mortgagor), the Mortgagee shall be satisfied as to the
      following:

     

    (A) no
      Event
      of Default or any event which, with the passage of time or giving of notice
      would constitute an Event of Default, has occurred and is
      continuing;

     

    (B) either
      such Improvements have been fully restored, or the expenditure of money as
      may
      be received from such insurance proceeds will be sufficient to repair, restore
      or rebuild the Premises, free and clear of all liens, claims and encumbrances,
      except the lien of this Mortgage and the Permitted Exceptions, or, if such
      insurance proceeds shall be insufficient to repair, restore and rebuild the
      Premises, the Mortgagor has deposited with the Mortgagee such amount of money
      which, together with the insurance proceeds shall be sufficient to restore,
      repair and rebuild the Premises; and

     

    (C) prior
      to
      each disbursement of any such proceeds, the Mortgagee shall be furnished with
      a
      statement of the Mortgagee’s architect (the cost of which shall be borne by the
      Mortgagor), certifying the extent of the repair and restoration completed to
      the
      date thereof, and that such repairs, restoration, and rebuilding have been
      performed to date in conformity with the plans and specifications approved
      by
      the Mortgagee and with all statutes, regulations or ordinances (including
      building and zoning ordinances) affecting the Premises; and the Mortgagee shall
      be furnished with appropriate evidence of payment for labor or materials
      furnished to the Premises, and total or partial lien waivers substantiating
      such
      payments.

     

    (iii) If
      the
      Mortgagor shall fail to commence or to timely prosecute to completion any
      restoration, repair or rebuilding of the Improvements required under the terms
      of this Mortgage within a reasonable time, then the Mortgagee, at its option,
      may (A) commence and perform all necessary acts to restore, repair or rebuild
      the said Improvements for or on behalf of the Mortgagor, or (B) if the cost
      to
      repair same shall exceed the Threshold, declare an Event of Default. If
      insurance proceeds shall exceed the amount necessary to complete the repair,
      restoration or rebuilding of the Improvements, then, after completion of such
      repair, restoration or rebuilding, so long as no Event of Default or event
      which, with the passage of time or giving of notice would constitute an Event
      of
      Default has occurred which is continuing, such excess shall be remitted to
      Mortgagor.

     

    
      
        
        

      

      
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    7. Condemnation.
      

     

    If
      all or
      any part of the Premises are damaged, taken or acquired, either temporarily
      or
      permanently, in any condemnation proceeding, or by exercise of the right of
      eminent domain, the amount of any award or other payment for such taking or
      damages made in consideration thereof, to the extent of the full amount of
      the
      remaining unpaid Indebtedness, is hereby assigned to the Mortgagee, who is
      empowered to collect and receive the same and to give proper receipts therefor
      in the name of the Mortgagor and the same shall be paid forthwith to the
      Mortgagee. Subject to the next succeeding sentence, any such award or monies
      in
      an amount in excess of the Threshold shall be applied on account of the
      Indebtedness, irrespective of whether such Indebtedness is then due and payable
      and, at any time from and after the taking the Mortgagee may declare the whole
      of the balance of the Indebtedness to be due and payable. Notwithstanding the
      provisions of this section to the contrary, if any condemnation or taking of
      less than substantially the entire Premises occurs and provided that no Event
      of
      Default and no event or circumstance which with the passage of time, the giving
      of notice or both would constitute an Event of Default then exists, and if
      such
      partial condemnation, in the reasonable discretion of the Mortgagee, has no
      material adverse effect on the operation or value of the Premises, then the
      award or payment for such taking or consideration for damages resulting
      therefrom may be collected and received by the Mortgagor, and the Mortgagee
      hereby agrees that in such event it shall not declare the Indebtedness to be
      due
      and payable, if it is not otherwise then due and payable.

     

    8. Stamp
      Tax. 

     

    If,
      by
      the laws of the United States of America, or of any state or political
      subdivision having jurisdiction over the Mortgagor, any tax is due or becomes
      due in respect of the execution and delivery of this Mortgage, the Note or
      any
      of the other Loan Documents, the Mortgagor shall pay such tax in the manner
      required by any such law. The Mortgagor further agrees to reimburse the
      Mortgagee for any sums which the Mortgagee may expend by reason of the
      imposition of any such tax. Notwithstanding the foregoing, the Mortgagor shall
      not be required to pay any income or franchise taxes of the
      Mortgagee.

     

    9. Lease
      Assignment. 

     

    The
      Mortgagor acknowledges that, concurrently herewith, the Mortgagor has executed
      and delivered to the Mortgagee, as additional security for the repayment of
      the
      Loan, an Assignment of Rents and Leases (the “Assignment”) pursuant to
      which the Mortgagor has assigned to the Mortgagee interests in the leases of
      the
      Premises and/or any use or occupancy thereof by any person or entity other
      than
      the Mortgagor and the rents from the Premises. All of the provisions of the
      Assignment are hereby incorporated herein as if fully set forth at length in
      the
      text of this Mortgage. The Mortgagor agrees to abide by all of the provisions
      of
      the Assignment.

     

    10. Effect
      of
      Extensions of Time and Other Changes. 

     

    If
      the
      payment of the Indebtedness or any part thereof is extended or varied, if any
      part of any security for the payment of the Indebtedness is released, if the
      rate of interest charged under the Note is changed or if the time for payment
      thereof is extended or varied, all persons now or at any time hereafter liable
      therefor, or interested in the Premises or having an interest in the Mortgagor,
      shall be held to assent to such extension, variation, release or change and
      their liability and the lien and all of the provisions hereof shall continue
      in
      full force, any right of recourse against all such persons being expressly
      reserved by the Mortgagee, notwithstanding such extension, variation, release
      or
      change.

     

    
      
        
        

      

      
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    11. Effect
      of
      Changes in Laws Regarding Taxation. 

     

    If
      any
      law is enacted after the date hereof requiring (a) the imposition upon the
      Mortgagee of the payment of the whole or any part of the Taxes, charges or
      liens
      herein required to be paid by the Mortgagor, or (b) a change in the method
      of taxation of mortgages or the Mortgagee’s interest in the Premises, or the
      manner of collection of taxes, so as to adversely affect this Mortgage, then
      the
      Mortgagor, upon demand by the Mortgagee, shall pay such Taxes or charges, or
      reimburse the Mortgagee therefor; provided, however, that the Mortgagor shall
      not be deemed to be required to pay any income or franchise taxes of the
      Mortgagee. Notwithstanding the foregoing, if in the opinion of counsel for
      the
      Mortgagee it is or may be unlawful to require the Mortgagor to make such payment
      or the making of such payment might result in the imposition of interest beyond
      the maximum amount permitted by law, then the Mortgagee may declare all of
      the
      Indebtedness to be due and payable six (6) months after notice of same delivered
      by the Mortgagee to the Mortgagor.

     

    12. Mortgagee’s
      Performance of Defaulted Acts and Expenses Incurred by Mortgagee. 

     

    If
      an
      Event of Default has occurred which is continuing, the Mortgagee may, but need
      not, after reasonably notice to the Mortgagor (provided that no prior notice
      shall be required in the event of an emergency) make any payment or perform
      any
      act herein required of the Mortgagor in any form and manner reasonably deemed
      expedient by the Mortgagee, and may, but need not, make full or partial payments
      of principal or interest on prior encumbrances, if any, and purchase or
      discharge, or compromise or settle (for less than the amount claimed), any
      tax
      lien or other prior lien or title or claim thereof, or redeem from any tax
      sale
      or forfeiture affecting the Premises or cure any default of the Mortgagor in
      any
      lease of the Premises. All monies paid for any of the purposes herein authorized
      and all expenses paid or incurred in connection therewith, including reasonable
      attorneys’ fees, and any other monies advanced by the Mortgagee in regard to any
      tax referred to in Section 8 above or to protect the Premises or the lien
      hereof, shall be so much additional Indebtedness, and shall become immediately
      due and payable by the Mortgagor to the Mortgagee, upon demand, and with
      interest thereon accruing from the date of such demand until paid at the Default
      Rate (as
      defined in the Note). In addition to the foregoing, any costs, expenses and
      fees, including reasonable attorneys’ fees, incurred by the Mortgagee in
      connection with (a) sustaining the lien of this Mortgage or its priority,
      (b) protecting or enforcing any of the Mortgagee’s rights hereunder,
      (c) recovering any Indebtedness, (d) any litigation or proceedings
      affecting the Note, this Mortgage, any of the other Loan Documents or the
      Premises, including without limitation, bankruptcy and probate proceedings,
      or
      (e)  preparing for the commencement, defense or participation in any
      threatened litigation or proceedings affecting the Note, this Mortgage, any
      of
      the other Loan Documents or the Premises, shall be so much additional
      Indebtedness, and shall become immediately due and payable by the Mortgagor
      to
      the Mortgagee, upon demand, and with interest thereon accruing from the date
      of
      such demand until paid at the Default Rate. The interest accruing under this
      section shall be immediately due and payable by the Mortgagor to the Mortgagee,
      and shall be additional Indebtedness evidenced by the Note and secured by this
      Mortgage. The Mortgagee’s failure to act shall never be considered as a waiver
      of any right accruing to the Mortgagee on account of any Event of Default.
      Should any amount paid out or advanced by the Mortgagee hereunder, or pursuant
      to any agreement executed by the Mortgagor in connection with the Loan, be
      used
      directly or indirectly to pay off, discharge or satisfy, in whole or in part,
      any lien or encumbrance upon the Premises or any part thereof, then the
      Mortgagee shall be subrogated to any and all rights, equal or superior titles,
      liens and equities, owned or claimed by any owner or holder of said outstanding
      liens, charges and indebtedness, regardless of whether said liens, charges
      and
      indebtedness are acquired by assignment or have been released of record by
      the
      holder thereof upon payment.

     

    
      
        
        

      

      
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    13. Security
      Agreement. 

     

    The
      Mortgagor and the Mortgagee agree that this Mortgage shall constitute a Security
      Agreement within the meaning of the Uniform Commercial Code of the State of
      Connecticut (the “Code”) with respect to the Premises and, all other
      items described in Sections (a) through (g) of the “AGREEMENTS” Section of this
      Mortgage (each to the extent not constituting real property), together with
      all
      sums at any time on deposit for the benefit of the Mortgagor and held by the
      Mortgagee (whether deposited by or on behalf of the Mortgagor or anyone else)
      pursuant to any of the provisions of this Mortgage or the other Loan Documents
      and all replacements of, substitutions for, additions to, and the proceeds
      thereof (collectively, the “Collateral”), and that a security interest in
      and to the Collateral is hereby granted to the Mortgagee, and the Collateral
      and
      all of the Mortgagor’s right, title and interest therein are hereby assigned to
      the Mortgagee, all to secure payment of the Indebtedness. All of the provisions
      contained in this Mortgage pertain and apply to the Collateral as fully and
      to
      the same extent as to any other property comprising the Premises; and the
      following provisions of this section shall not limit the applicability of
      any other provision of this Mortgage but shall be in addition
      thereto:

     

    (a) The
      Mortgagor (being the Debtor as that term is used in the Code) is and will be
      the
      true and lawful owner of the Collateral, subject to no liens, charges or
      encumbrances other than the lien hereof, other liens and encumbrances benefiting
      the Mortgagee and Permitted Exceptions.

     

    (b) The
      Collateral is to be used by the Mortgagor solely for business
      purposes.

     

    (c) The
      Collateral may be affixed to the Real Estate but will not be affixed to any
      other real estate.

     

    (d) The
      only
      persons having any interest in the Collateral are the Mortgagor, the Mortgagee
      and holders of Permitted Exceptions.

     

    (e) No
      Financing Statement (other than Financing Statements showing the Mortgagee
      as
      the sole secured party, or with respect to Permitted Exceptions) covering any
      of
      the Collateral or any proceeds thereof is on file in any public office except
      pursuant hereto; and the Mortgagor, at its own cost and expense, upon demand,
      will furnish to the Mortgagee such further information and will execute and
      deliver to the Mortgagee such financing statements and other documents in form
      satisfactory to the Mortgagee and will do all such acts as the Mortgagee may
      request at any time or from time to time or as may be necessary or appropriate
      to establish and maintain a perfected security interest in the Collateral as
      security for the Indebtedness, subject to no other liens or encumbrances, other
      than liens or encumbrances benefiting the Mortgagee and no other party, and
      Permitted Exceptions; and the Mortgagor will pay the cost of filing or recording
      such financing statements or other documents, and this instrument, in all public
      offices wherever filing or recording is deemed by the Mortgagee to be desirable.
      The Mortgagor hereby irrevocably authorizes the Mortgagee at any time, and
      from
      time to time, to file in any jurisdiction any initial financing statements
      and
      amendments thereto, without the signature of the Mortgagor that (i) indicate
      the
      Collateral, and (ii) contain any other information required by Section 5 of
      Article 9 of the Uniform Commercial Code of the jurisdiction wherein such
      financing statement or amendment is filed regarding the sufficiency or filing
      office acceptance of any financing statement or amendment, including (A) whether
      the Mortgagor is an organization, the type of organization and any
      organizational identification number issued to the Mortgagor, and (B) in the
      case of a financing statement filed as a fixture filing, a sufficient
      description of the real property to which the Collateral relates. The Mortgagor
      agrees to furnish any such information to the Mortgagee promptly upon request.
      The Mortgagor further ratifies and affirms its authorization for any financing
      statements and/or amendments thereto, executed and filed by the Mortgagee in
      any
      jurisdiction prior to the date of this Mortgage. In addition, the Mortgagor
      shall make appropriate entries on its books and records disclosing the
      Mortgagee’s security interests in the Collateral.

     

    
      
        
        

      

      
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    (f) Upon
      the
      occurrence and during the existence of Event of Default hereunder, the Mortgagee
      shall have in respect of the Collateral the remedies of a secured party under
      the Code, including, without limitation, the right to take immediate and
      exclusive possession of the Collateral, or any part thereof, and for that
      purpose, so far as the Mortgagor can give authority therefor, with or without
      judicial process, may enter (if this can be done without breach of the peace)
      upon any place which the Collateral or any part thereof may be situated and
      remove the same therefrom (provided that if the Collateral is affixed to real
      estate, such removal shall be subject to the conditions stated in the Code);
      and
      the Mortgagee shall be entitled to hold, maintain, preserve and prepare the
      Collateral for sale, until disposed of, or may propose to retain the Collateral
      subject to the Mortgagor’s right of redemption in satisfaction of the
      Mortgagor’s obligations, as provided in the Code. The Mortgagee may render the
      Collateral unusable without removal and may dispose of the Collateral on the
      Premises. The Mortgagee may require the Mortgagor to assemble the Collateral
      and
      make it available to the Mortgagee for its possession at a place to be
      designated by the Mortgagee which is reasonably convenient to both parties.
      The
      Mortgagee will give the Mortgagor at least ten (10) days notice of the time
      and
      place of any public sale of the Collateral or of the time after which any
      private sale or any other intended disposition thereof is made. The requirements
      of reasonable notice shall be met if such notice is mailed, by certified United
      States mail or equivalent, postage prepaid, to the address of the Mortgagor
      hereinafter set forth at least ten (10) days before the time of the sale or
      disposition. The Mortgagee may buy at any public sale. The Mortgagee may buy
      at
      private sale if the Collateral is of a type customarily sold in a recognized
      market or is of a type which is the subject of widely distributed standard
      price
      quotations. Any such sale may be held in conjunction with any foreclosure sale
      of the Premises. If the Mortgagee so elects, the Premises and the Collateral
      may
      be sold as one lot. The net proceeds realized upon any such disposition, after
      deduction for the expenses of retaking, holding, preparing for sale, selling
      and
      the reasonable attorneys’ fees and legal expenses incurred by the Mortgagee,
      shall be applied against the Indebtedness in such order or manner as the
      Mortgagee shall select. The Mortgagee will account to the Mortgagor for any
      surplus realized on such disposition.

     

    (g) The
      terms
      and provisions contained in this section, unless the context otherwise requires,
      shall have the meanings and be construed as provided in the Code.

     

    (h) This
      Mortgage is intended to be a financing statement within the purview of
Section 9-502(b)
      of the Code with respect to the Collateral. The addresses of the Mortgagor
      (Debtor) and the Mortgagee (Secured Party) are hereinbelow set forth. This
      Mortgage is to be filed for recording in the Naugatuck Land Records where the
      Premises are located. The Mortgagor is the record owner of the
      Premises.

     

    (i) To
      the
      extent permitted by applicable law, the security interest created hereby is
      specifically intended to cover all Leases between the Mortgagor or its agents
      as
      lessor, and various tenants named therein, as lessee, including all extended
      terms and all extensions and renewals of the terms thereof, as well as any
      amendments to or replacement of said Leases, together with all of the right,
      title and interest of the Mortgagor, as lessor thereunder.

     

    (j) The
      Mortgagor represents and warrants that: (i) the Mortgagor is the record owner
      of
      the Premises; (ii) the Mortgagor’s chief executive office is located in the
      State of Connecticut, (iii) the Mortgagor’s state of organization is
      the
      State of Delaware, (iv) the Mortgagor’s exact legal name is as set forth on Page
      1 of this Mortgage; and (v) the Mortgagor’s organizational identification number
      (which appears on its certificate of incorporation) is 2058950.

     

    
      
        
        

      

      
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    (k) The
      Mortgagor hereby agrees that: (i)
      where
      Collateral is in possession of a third party, the Mortgagor will join with
      the
      Mortgagee in notifying the third party of the Mortgagee’s interest and obtaining
      an acknowledgment from the third party that it is holding the Collateral for
      the
      benefit of the Mortgagee; (ii) the Mortgagor will cooperate with the Mortgagee
      in obtaining control with respect to Collateral; and (iii) until
      the
      Indebtedness is paid in full, Mortgagor will not change the state where it
      is
      located or change its name or form of organization without giving the Mortgagee
      at least thirty (30) days prior written notice in each instance.

     

    14. Restrictions
      on Transfers and Distributions. 

     

    (a) The
      Mortgagor, without the prior written consent of the Mortgagee, shall not effect,
      suffer or permit any Prohibited Transfer (as defined herein). “Prohibited
      Transfer” means any conveyance, sale, assignment, transfer, lien, pledge,
      mortgage, creation or grant of security interest or other encumbrance or
      alienation (or any agreement to do any of the foregoing) of the Premises or
      any
      part thereof or interest therein, excepting only:

     

    (i) sales
      or
      other dispositions (or any agreement to sell or dispose) of Collateral
      (“Obsolete Collateral”) no longer useful in connection with the operation
      of the Premises, provided that prior to the sale or other disposition thereof,
      such Obsolete Collateral has been replaced by Collateral of at least equal
      value
      and utility which is subject to the lien hereof with the same priority as with
      respect to the Obsolete Collateral or other sales or dispositions of Collateral
      in the ordinary course of the Mortgagor’s business; and

     

    (ii) a
      sale of
      the Premises (or any agreement to sell the Premises), so long as either (A)
      the
      cash net proceeds of such sale are sufficient to repay in full this Note and
      all
      other obligations of Borrower to Lender under the Loan Documents and are applied
      in accordance with the terms of the Loan Documents or (B) substitute collateral
      satisfactory to the Mortgagee in its sole discretion shall have been provided
      to
      secure the Indebtedness; 

     

    in
      each
      case whether any such conveyance, sale, assignment, transfer, lien, pledge,
      mortgage, security interest, encumbrance or alienation is effected directly,
      indirectly (including the nominee agreement), voluntarily or involuntarily,
      by
      operation of law or otherwise; provided, however, that the foregoing provisions
      of this section shall not apply (i) to liens securing the Indebtedness,
      (ii) to the lien of current taxes and assessments not in default, (iii) to
      leases or other occupancy agreements permitted by the terms of the Loan
      Documents, if any, (iv) to Permitted Exceptions, or (v) to the execution of
      an
      agreement to sell the Real Estate and Improvements for a price reasonably
      anticipated to result in cash net proceeds sufficient to repay in full the
      Note
      and all other obligations of Borrower to Lender under the Loan Documents
      executed between Borrower and an unaffiliated third party.

     

    (b) In
      determining whether or not to make the Loan, the Mortgagee evaluated the
      background and experience of the Mortgagor and its officers in owning and
      operating property such as the Premises, found it acceptable and relied and
      continues to rely upon same as the means of maintaining the value of the
      Premises which is the Mortgagee’s security for the Note. The Mortgagor and its
      officers are well experienced in borrowing money and owning and operating
      property such as the Premises, were ably represented by a licensed attorney
      at
      law in the negotiation and documentation of the Loan and bargained at arm’s
      length and without duress of any kind for all of the terms and conditions of
      the
      Loan, including this provision.. The Mortgagor further recognizes that any
      secondary junior financing secured by a lien (exclusive of Permitted Exceptions)
      hereafter placed upon the Premises (i) may divert funds which would
      otherwise be used to pay the Note; (ii) could result in acceleration and
      foreclosure by any such junior encumbrancer which would force the Mortgagee
      to
      take measures and incur expenses to protect its security; (iii) would
      detract from the value of the Premises should the Mortgagee come into possession
      thereof with the intention of selling same; and (iv) would impair the
      Mortgagee’s right to accept a deed in lieu of foreclosure, as a foreclosure by
      the Mortgagee would be necessary to clear the title to the Premises. In
      accordance with the foregoing and for the purposes of (a) protecting the
      Mortgagee’s security, both of repayment and of value of the Premises;
      (b) giving the Mortgagee the full benefit of its bargain and contract with
      the Mortgagor; and (c) keeping the Premises free of subordinate financing
      liens, the Mortgagor agrees that if this section is deemed a restraint on
      alienation, that it is a reasonable one, provided, however, that, the foregoing
      shall not prohibit, subject to the terms of the Subordination and Intercreditor
      Agreement, the existence of and advances under the “Subordinate Indebtedness”
(as such term is defined in the Subordination and Intercreditor Agreement)
      and
      other Permitted Exceptions.

     

    
      
        
        

      

      
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    (c) Limitation
      on Distributions. For so long as the Loan remains outstanding, the Mortgagor
      hereby covenants to the Mortgagee that in no event shall the Mortgagor make
      distributions of any revenue received by or on behalf of the Mortgagor from
      the
      operation or ownership of the Premises if (i) the monthly payment of interest
      due the Mortgagee under the Note has not been paid or (ii) if any other Event
      of
      Default or an event that with the passage of time, the giving of notice or
      both
      would constitute an Event of Default then exists. Except to the extent of the
      foregoing restriction, nothing in this Mortgage or the other Loan Documents
      shall prevent the Mortgagor from making dividends or other distributions to
      its
      equity holders on account of their equity interests in the Mortgagor to the
      extent that the Mortgagor otherwise is permitted to do so under applicable
      law.

     

    15. Single
      Asset Entity. 

     

    (a) The
      Mortgagor shall not hold or acquire, directly or indirectly, any ownership
      interest (legal or equitable) in any real or personal property other than the
      Premises and personal property incidental to the ownership or operation of
      the
      Premises, or become a shareholder of or a member or partner in any entity which
      acquires any property other than the Premises, until such time as the
      Indebtedness has been fully repaid. The Certificate of Incorporation of the
      Mortgagor (the “C of I”) expressly shall limit its purpose to the
      acquisition, operation, management and disposition of the Premises and shall
      expressly include provisions identical to those set forth in this Section 15,
      and such purposes and provisions shall not be amended without the prior written
      consent of the Mortgagee. Until such time as the Indebtedness is paid in full,
      from and after the date hereof, the Mortgagor will:

     

    (i) Maintain
      books and records separate from any other individual, corporation, partnership,
      joint venture, limited liability company, limited liability partnership,
      association, joint stock company, trust (including any beneficiary thereof),
      unincorporated organization, or other organization, whether or not a legal
      entity, and any governmental authority (collectively,
“Person”);

     

    (ii) Maintain
      its bank accounts separate from any other Person;

     

    
      
        
        

      

      
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    (iii) Not
      commingle assets with those of any other Person and hold all of its assets
      in
      its own name;

     

    (iv) Conduct
      its own business in its own name;

     

    (v) Maintain
      separate financial statements (except that the Mortgagor may be included in
      consolidated financial statements of another Person provided such statements
      are
      prepared in accordance with GAAP;

     

    (vi) Pay
      its
      own liabilities out of its own funds, provided, however, the foregoing shall
      not
      require any shareholder of the Mortgagor to make any additional capital
      contributions to the Mortgagor;

     

    (vii) Observe
      all corporate formalities;

     

    (viii) Pay
      the
      salaries of its own employees and maintain a sufficient number of employees
      in
      light of its contemplated business operations, provided, however, the foregoing
      shall not require any shareholder of the Mortgagor to make any additional
      capital contributions to the Mortgagor;

     

    (ix) Not
      guarantee or become obligated for the debts of any other Person or hold out
      its
      credit as being available to satisfy the obligations of others, provided that
      the Mortgagor and the Mortgagee acknowledge that the Permitted Exceptions listed
      as items 3 and 5 on Exhibit B hereto constitute existing obligations of the
      Mortgagor not in violation of this restriction;

     

    (x) Not
      acquire obligations or securities of its shareholders or any of its affiliates,
      as applicable, provided that each of the Mortgagor and the Mortgagee
      acknowledges that the Lease dated as of even date with this Mortgage between
      the
      Mortgagor, as lessor, and General DataComm, Inc., as lessee, constitutes an
      agreement with an affiliate of the Mortgagor not in violation of this
      restriction;

     

    (xi) Allocate
      fairly and reasonably any overhead for shared office space or other expenses
      shared with its affiliates;

     

    (xii) Use
      separate stationery, invoices and checks;

     

    (xiii) Not
      pledge its assets to secure the obligations owed by any other Person or make
      any
      loans or advances to any Person, provided that the Mortgagor and the Mortgagee
      acknowledge that the Permitted Exceptions listed as items 3 and 5 on Exhibit
      B
      hereto constitute existing obligations of the Mortgagor not in violation of
      this
      restriction;

     

    (xiv) Hold
      itself out as a separate entity;

     

    (xv) Correct
      any known misunderstanding regarding its separate identity;

     

    (xvi) Maintain
      adequate capital in light of its contemplated business operations, provided,
      however, the foregoing shall not require any shareholder of the Mortgagor to
      make any additional capital contributions to the Mortgagor;

     

    
      
        
        

      

      
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    (xvii) To
      the
      fullest extent permitted by law, not dissolve, wind up or liquidate, in whole
      or
      in part, consolidate or merge with or into any other Person, or convey or sell
      its properties and assets substantially as an entirety to any Person, except
      for
      sales expressly permitted by this Mortgage or the other Loan
      Documents;

     

    (xviii) Not
      incur, assume or guarantee any indebtedness other than the Loan evidenced and
      secured by this Mortgage and the other Loan Documents and debt permitted by
      the
      Loan Documents (including, if applicable, debt secured by Permitted
      Exceptions);

     

    (xix) Not
      identify itself as a division of any other Person;

     

    (xx) Not
      form,
      hold or acquire any subsidiaries;

     

    (xxi) Not
      make
      any loans to any other Person or buy or hold evidence of indebtedness issued
      by
      others (other than investment grade securities);

     

    (xxii) Enter
      into transactions with its affiliates only on a commercially reasonable basis
      and on terms similar to those available in an arms-length transaction with
      a
      third party, provided that each of the Mortgagor and the Mortgagee acknowledges
      that (A) the Lease dated as of even date with this Mortgage between the
      Mortgagor, as lessor, and General DataComm, Inc., as lessee, constitutes an
      agreement with an affiliate of the Mortgagor not in violation of this
      restriction and (B) the Permitted Exception listed as item 3 on Exhibit B hereto
      constitutes an existing obligation of the Mortgagor not in violation of this
      restriction;

     

    (xxiii) Either
      file its own tax returns separate from those of any other Person or file as
      part
      of the consolidated tax returns of its parent (to the extent permitted or
      required by applicable law and generally accepted practice), except to the
      extent that the Mortgagor is treated as a “disregarded entity” for tax purposes
      and is not required to file tax returns under applicable law,, and pay any
      taxes
      required to be paid by it under applicable law;

     

    (xxiv) Not
      engage, directly or indirectly, in any business other than as required or
      permitted to be performed under the Loan Documents or the Mortgagor’s C of I;
      and

     

    (xxv) Not
      own
      any asset or property other than the Premises, the other Collateral and
      incidental personal property necessary for the ownership or operation of the
      Premises;

     

    (xxvi) Not
      consent to or authorize the taking of any of the actions set forth below without
      the prior unanimous written consent of all the members of the Board of Directors
      of the Mortgagor, including the Independent Director thereof:

     

    (A) file
      or
      consent to the filing by or against the Mortgagor, as debtor, of any bankruptcy,
      insolvency or reorganization case or proceeding; institute any proceedings
      by
      the Mortgagor,
      as
      debtor, under any applicable insolvency law; or otherwise seek relief for the
      Mortgagor, as debtor, under any laws relating to the relief from debts or the
      protection of debtors generally; 

     

    
      
        
        

      

      
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    (B) seek
      or
      consent to the appointment of a receiver, liquidator, assignee, trustee,
      sequestrator, custodian or any similar official for the Mortgagor or a
      substantial portion of the Mortgagor’s property; 

     

    (C) make
      any
      assignment for the benefit of the creditors of the Mortgagor;
      or

     

    (D) take
      any
      action in furtherance of any of the foregoing. 

     

    Failure
      of the Mortgagor to comply with any of the foregoing covenants or any other
      covenants contained in the C of I shall not affect the status of the Mortgagor
      as a separate legal entity.

     

    (b) The
      Mortgagor, at all times until such time as the Loan is paid in full, shall
      have
      at least one (1) Independent Director (an “Independent Director”).
“Independent Director” means a natural Person other than an executive
      officer or employee of the Mortgagor who the Board of Directors of the Mortgagor
      affirmatively determines does not have a relationship that would interfere
      with
      the exercise of independent judgment in carrying out the responsibilities of
      a
      director. Notwithstanding the foregoing, the following persons would not be
      considered independent:

     

    (i) a
      director who is, or during the past three (3) years was, employed by the
      Mortgagor, other than prior employment as an interim executive officer (provided
      the interim employment did not last longer than one (1) year);

     

    (ii) a
      director who accepted or has an immediate family member who accepted any
      compensation from the Mortgagor in excess of $60,000 during any period of twelve
      (12) consecutive months within the three (3) years preceding the determination
      of independence, other than the following:

     

    (A) compensation
      for board or board committee service;

     

    (B) compensation
      paid to an immediate family member who is an employee (other than an executive
      officer) of the Mortgagor;

     

    (C) compensation
      received for former service as an interim executive officer (provided the
      interim employment did not last longer than one (1) year); or

     

    (D) benefits
      under a tax-qualified retirement plan or non-discretionary
      compensation;

     

    (iii) a
      director who is an immediate family member of an individual who is, or at any
      time during the past three (3) years was, employed by the Mortgagor as an
      executive officer;

     

    (iv) a
      director who is, or has an immediate family member who is, a partner in, or
      a
      controlling shareholder or an executive officer of, any organization to which
      the Mortgagor made, or from which the Mortgagor received, payments (other than
      those arising solely from investments in the Mortgagor’s securities or payments
      under non-discretionary charitable contribution matching programs) that exceed
      five percent (5%) of the organization’s consolidated gross revenues for that
      year, or $200,000, whichever is more, in any of the most recent three (3) fiscal
      years;

     

    
      
        
        

      

      
        17

        
          

        

      

      
        
        

      

    

     

    (v) a
      director who is, or has an immediate family member who is, employed as an
      executive officer of another entity where at any time during the most recent
      three (3) fiscal years any of the Mortgagor’s executive officers serve on the
      compensation committee of such other entity; or

     

    (vi) a
      director who is, or has an immediate family member who is, a current partner
      of
      the Mortgagor’s outside auditor, or was a partner or employee of the Mortgagor’s
      outside auditor who worked on the Mortgagor’s audit at any time during any of
      the past three (3) years.

     

    In
      the
      event of a vacancy in a position of Independent Director, the Mortgagor shall,
      as soon as practicable, cause to be appointed a successor Independent Director.
      Notwithstanding the foregoing, Aletta Richards or any successor thereof as
      the
      representative of certain holders of debentures issued by the Guarantor on
      the
      Board of Directors of the Mortgagor shall be deemed to constitute an Independent
      Director.

     

    16. Events
      of
      Default; Acceleration. 

     

    The
      occurrence and continuance of each of the following shall constitute an
“Event of Default” for purposes of this Mortgage:

     

    (a) The
      Mortgagor fails to pay to the Mortgagee (i) any installment of principal or
      interest within five (5) days after such installment is payable pursuant to
      the
      terms of the Note or any monthly deposit for Taxes within five (5) days after
      such deposit is payable pursuant to Section 4 of the Mortgage, or (ii) any
      other amount payable to Mortgagee under the Note, this Mortgage or any of the
      other Loan Documents within thirty (30) days after
      the date
      of demand for such amount;

     

    (b) The
      Mortgagor fails, for a period of thirty days after notice thereof, to perform
      or
      cause to be performed any other obligation or observe any other condition,
      covenant, term, agreement or provision required to be performed or observed
      by
      the Mortgagor under the Note, this Mortgage or any of the other Loan Documents
      (other than any such failure which is the subject of clauses (a), (c), (d),
      (e),
      (f), (g), (h) or (i) of this Section 16) provided, however, that if such default
      by its nature can be cured, then so long as the value of the Premises is not
      materially impaired, threatened or jeopardized, and the priority, validity
      and
      enforceability of the liens created by the Mortgage or any of the other Loan
      Documents are not impaired, threatened or jeopardized, then the Mortgagor shall
      have a period (the “Cure Period”) of sixty (60) days after the Mortgagor
      receives written notice of such failure to cure the same and an Event of Default
      shall not be deemed to exist during the Cure Period, provided further that
      if
      the Mortgagor commences to cure such failure during the Cure Period and is
      diligently and in good faith attempting to effect such cure, the Cure Period
      shall be extended for thirty (30) additional days, but in no event shall the
      Cure Period be longer than ninety (90) days in the aggregate;

     

    (c) The
      existence of any inaccuracy or untruth in any material respect in any
      certification, representation or warranty by the Mortgagor or by the Guarantor
      contained in this Mortgage, any of the other Loan Documents or any written
      certification as to facts delivered after the date hereof to the Mortgagee
      by
      the Mortgagor or the Guarantor in connection with the Loan, at the time such
      certification, representation or warranty is made (or deemed made);

     

    
      
        
        

      

      
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    (d) The
      Mortgagor or the Guarantor files
      a
      voluntary petition in bankruptcy or is adjudicated a bankrupt or insolvent
      or
      files any petition or answer seeking any reorganization, arrangement,
      composition, readjustment, liquidation, dissolution or similar relief under
      the
      present or any future federal, state, or other statute or law, or seeks or
      consents to or acquiesces in the appointment of any trustee, receiver or similar
      officer of the Mortgagor or of all or any substantial part of the property
      of
      the Mortgagor, or the Guarantor, the Premises or all or a substantial part
      of
      the assets of the Mortgagor or
      the
      Guarantor are attached, seized, subjected to a writ or distress warrant or
      are
      levied upon unless the same is released, dismissed or discharged or located
      within sixty (60) days;

     

    (e) The
      commencement of any involuntary petition in bankruptcy against the Mortgagor
      or
      the Guarantor, or the institution against the Mortgagor or the
      Guarantor of
      any
      reorganization, arrangement, composition, readjustment, dissolution, liquidation
      or similar proceedings under any present or future federal, state or other
      statute or law, or the appointment of a receiver, trustee or similar officer
      for
      all or any substantial part of the property of the Mortgagor or the
      Guarantor which
      shall remain undismissed or undischarged for a period of sixty (60)
      days;

     

    (f) The
      dissolution, termination or merger of the Mortgagor or the
      Guarantor;

     

    (g) The
      occurrence of a Prohibited Transfer;

     

    (h) The
      occurrence of an Event of Default under the Note or any of the other Loan
      Documents for which the Indebtedness has been accelerated; or

     

    (i) Howard
      Modlin shall cease to be the Chairman and Chief Executive Officer of Guarantor,
      except by reason of his death or disability.

     

    If
      an
      Event of Default occurs and is continuing, the Mortgagee may, at its option,
      declare the whole of the Indebtedness to be immediately due and payable, (i)
      without notice, upon the occurrence and during the continuance of any Event
      of
      Default under Section 16(d) or (e) of this Mortgage, or (ii) upon notice, upon
      the occurrence and during the continuance of any other Event of Default
      hereunder, with interest thereon accruing from the date of such Event of Default
      until paid at the Default Rate.

     

    17. Foreclosure;
      Expense of Litigation. 

     

    (a) When
      all
      or any part of the Indebtedness shall become due, whether by acceleration or
      otherwise, the Mortgagee shall have the right to foreclose the lien hereof
      for
      such Indebtedness or part thereof and/or exercise any right, power or remedy
      provided in this Mortgage or any of the other Loan Documents in accordance
      with
      the applicable laws of the State of Connecticut. In the event of a foreclosure
      sale, the Mortgagee is hereby authorized, without the consent of the Mortgagor,
      to assign any and all insurance policies to the purchaser at such sale or to
      take such other steps as the Mortgagee may deem advisable to cause the interest
      of such purchaser to be protected by any of such insurance
      policies.

     

    (b) In
      any
      suit to foreclose the lien hereof, there shall be allowed and included as
      additional indebtedness in the decree for sale all expenditures and expenses
      which may be paid or incurred by or on behalf of the Mortgagee for reasonable
      attorneys’ fees, appraisers’ fees, outlays for documentary and expert evidence,
      stenographers’ charges, publication costs, and costs (which may be estimated as
      to items to be expended after entry of the decree) of procuring all such
      abstracts of title, title searches and examinations, title insurance policies,
      and similar data and assurances with respect to the title as the Mortgagee
      may
      deem reasonably necessary either to prosecute such suit or to evidence to
      bidders at any sale which may be had pursuant to such decree the true condition
      of the title to or the value of the Premises. All expenditures and expenses
      of
      the nature mentioned in this section and such other expenses and fees as may
      be
      incurred in the enforcement of the Mortgagor’s obligations hereunder, the
      protection of said Premises and the maintenance of the lien of this Mortgage,
      including the reasonable fees of any attorney employed by the Mortgagee in
      any
      litigation or proceeding affecting this Mortgage, the Note, or the Premises,
      including probate and bankruptcy proceedings, or in preparations for the
      commencement or defense of any proceeding or threatened suit or proceeding
      shall
      be immediately due and payable by the Mortgagor, with interest thereon until
      paid at the Default Rate and shall be secured by this Mortgage.

     

    
      
        
        

      

      
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    18. Application
      of Proceeds of Foreclosure Sale. 

     

    The
      proceeds of any foreclosure sale of the Premises shall be distributed and
      applied in accordance with the applicable laws of the State of Connecticut
      and,
      unless otherwise specified therein, in such order as the Mortgagee may determine
      in its sole and absolute discretion.

     

    19. Appointment
      of Receiver. 

     

    Upon
      or
      at any time after the filing of a complaint to foreclose this Mortgage, the
      court in which such complaint is filed shall, upon petition by the Mortgagee,
      appoint a receiver for the Premises in accordance with applicable law of the
      State of Connecticut. Such appointment may be made either before or after sale,
      upon notice to the extent required by applicable law, without regard to the
      solvency or insolvency of the Mortgagor at the time of application for such
      receiver and without regard to the value of the Premises or whether the same
      shall be then occupied as a homestead or not and the Mortgagee hereunder or
      any
      other holder of the Note may be appointed as such receiver. Such receiver shall
      have power to collect the rents of the Premises (i) during the pendency of
      such foreclosure suit, (ii) in case of a sale and a deficiency, during the
      full statutory period of redemption, whether there be redemption or not, and
      (iii) during any further times when the Mortgagor, but for the intervention
      of such receiver, would be entitled to collect such rents. Such receiver also
      shall have all other powers and rights that may be necessary or are usual in
      such cases for the protection, possession, control, management and operation
      of
      the Premises during said period, including, to the extent permitted by law,
      the
      right to lease all or any portion of the Premises for a term that extends beyond
      the time of such receiver’s possession without obtaining prior court approval of
      such lease. The court from time to time may authorize the application of the
      net
      income received by the receiver in payment of (a) the Indebtedness, or by
      any decree foreclosing this Mortgage, or any tax, special assessment or other
      lien which may be or become superior to the lien hereof or of such decree,
      provided such application is made prior to foreclosure sale, and (b) any
      deficiency upon a sale and deficiency.

     

    20. Mortgagee’s
      Right of Possession in Case of Default. 

     

    At
      any
      time after an Event of Default has occurred which is continuing, the Mortgagor
      shall, upon demand of the Mortgagee, surrender to the Mortgagee possession
      of
      the Premises. The Mortgagee, in its discretion, may, with process of law, enter
      upon and take and maintain possession of all or any part of the Premises,
      together with all documents, books, records, papers and accounts relating
      thereto, and may exclude the Mortgagor and its employees, agents or servants
      therefrom, and the Mortgagee may then hold, operate, manage and control the
      Premises, either personally or by its agents. The Mortgagee shall have full
      power to use such measures, legal or equitable, as in its discretion may be
      deemed proper or necessary to enforce the payment or security of the rents
      of
      the Premises, including actions for the recovery of rent, actions in forcible
      detainer and actions in distress for rent. Without limiting the generality
      of
      the foregoing, the Mortgagee shall have full power to:

     

    (a) cancel
      or
      terminate any lease or sublease for any cause or on any ground which would
      entitle the Mortgagor to cancel the same;

     

    
      
        
        

      

      
        20

        
          

        

      

      
        
        

      

    

     

    (b) elect
      to
      disaffirm any lease or sublease which is then subordinate to the lien
      hereof;

     

    (c) extend
      or
      modify any then existing leases and to enter into new leases, which extensions,
      modifications and leases may provide for terms to expire, or for options to
      lessees to extend or renew terms to expire, beyond the Maturity Date and beyond
      the date of the issuance of a deed or deeds to a purchaser or purchasers at
      a
      foreclosure sale, it being understood and agreed that any such leases, and
      the
      options or other such provisions to be contained therein, shall be binding
      upon
      the Mortgagor and all persons whose interests in the Premises are subject to
      the
      lien hereof and upon the purchaser or purchasers at any foreclosure sale,
      notwithstanding any redemption from sale, discharge of the Indebtedness,
      satisfaction of any foreclosure judgment, or issuance of any certificate of
      sale
      or deed to any purchaser;

     

    (d) make
      any
      repairs, renewals, replacements, alterations, additions, betterments and
      improvements to the Premises for conditions arising after the date of this
      Mortgage as the Mortgagee deems are necessary;

     

    (e) insure
      and reinsure the Premises and all risks incidental to the Mortgagee’s
      possession, operation and management thereof; and

     

    (f) receive
      all of such rents.

     

    21. Application
      of Income Received by Mortgagee. 

     

    After
      the
      occurrence and during the continuance of an Event of Default, the Mortgagee,
      in
      the exercise of the rights and powers hereinabove conferred upon it, shall
      have
      full power to use and apply the rents of the Premises to the payment of or
      on
      account of the following, in such order as the Mortgagee may
      determine:

     

    (a) to
      the
      payment of the operating expenses of the Premises, including cost of management
      and leasing thereof (which shall include reasonable compensation to the
      Mortgagee and its agent or agents, if management be delegated to an agent or
      agents, and shall also include lease commissions and other compensation and
      expenses of seeking and procuring tenants and entering into leases), established
      claims for damages, if any, and premiums on insurance hereinabove
      authorized;

     

    (b) to
      the
      payment of taxes and special assessments now due or which may hereafter become
      due on the Premises; and

     

    (c) to
      the
      payment of any Indebtedness, including any deficiency which may result from
      any
      foreclosure sale.

     

    
      
        
        

      

      
        21

        
          

        

      

      
        
        

      

    

     

    22. Compliance
      with Applicable Law of the State of Connecticut.

     

    (a) If
      any
      provision in this Mortgage shall be inconsistent with any provision of the
      applicable law of the State of Connecticut, provisions of such law shall take
      precedence over the provisions of this Mortgage, but shall not invalidate or
      render unenforceable any other provision of this Mortgage that can be construed
      in a manner consistent with such law.

     

    (b) If
      any
      provision of this Mortgage shall grant to the Mortgagee (including the Mortgagee
      acting as a mortgagee-in-possession) or a receiver appointed pursuant to the
      provisions of Section 19 of this Mortgage any powers, rights or remedies
      prior to, upon or following the occurrence of an Event of Default which are
      more
      limited than the powers, rights or remedies that would otherwise be vested
      in
      the Mortgagee or in such receiver under the applicable law of the State of
      Connecticut in the absence of said provision, the Mortgagee and such receiver
      shall be vested with the powers, rights and remedies granted under such law
      to
      the full extent permitted by law.

     

    23. Rights
      Cumulative. 

     

    Each
      right, power and remedy herein conferred upon the Mortgagee is cumulative and
      in
      addition to every other right, power or remedy, express or implied, given now
      or
      hereafter existing under any of the Loan Documents or at law or in equity,
      and
      each and every right, power and remedy herein set forth or otherwise so existing
      may be exercised from time to time as often and in such order as may be deemed
      expedient by the Mortgagee, and the exercise or the beginning of the exercise
      of
      one right, power or remedy shall not be a waiver of the right to exercise at
      the
      same time or thereafter any other right, power or remedy, and no delay or
      omission of the Mortgagee in the exercise of any right, power or remedy accruing
      hereunder or arising otherwise shall impair any such right, power or remedy,
      or
      be construed to be a waiver of any Event of Default or acquiescence
      therein.

     

    24. Mortgagee’s
      Right of Inspection. 

     

    The
      Mortgagee and its representatives shall have the right to inspect the Premises
      and the books and records with respect thereto at all reasonable times upon
      three (3) business days prior notice to the Mortgagor, and access thereto,
      subject to the rights of tenants in possession, shall be permitted for that
      purpose.

     

    The
      Mortgagee acknowledges that, as of the closing of the Loan, it has inspected
      the
      Premises and accepts as collateral encumbered by this Mortgage the Improvements
      and Building Systems, in their current physical condition, AS IS, without
      representation by the Mortgagor respecting the physical condition of the
      Improvements and Building Systems and without duty on the Mortgagor to repair
      any existing condition or defect in the Improvements or Building
      Systems.

     

    25. Release
      Upon Payment and Discharge of Mortgagor’s Obligations. 

     

    The
      Mortgagee shall release this Mortgage and the lien hereof by proper instrument
      upon payment and discharge of all Indebtedness, including payment of all
      reasonable expenses incurred by the Mortgagee in connection with the execution
      of such release.

     

    
      
        
        

      

      
        22

        
          

        

      

      
        
        

      

    

     

    26. Notices.
      

     

    Any
      notices, communications and waivers under this Mortgage shall be in writing
      and
      shall be (i) delivered in person, (ii) mailed, postage prepaid, either
      by registered or certified mail, return receipt requested, or (iii) by
      overnight express carrier, addressed in each case as follows:

     

    
      	
              To
                the Mortgagee

            	 	
              Atlas
                Partners Mortgage Investors, LLC

              55
                East Monroe Street

              Suite
                1890

              Chicago,
                Illinois 60603

              Attn:
                Mr. Roger Ruttenberg

            
	
               

            	 	
               

            
	
              With
                a copy to:

            	 	
              Neal,
                Gerber & Eisenberg, LLP

              2
                North LaSalle Street

              Suite
                2200

              Chicago,
                Illinois 60602

              Attention:
                Michael B. Gray

            
	
               

            	 	
               

            
	
              To
                the Mortgagor:

            	 	
              GDC
                Naugatuck, Inc.

              6
                Rubber Avenue

              Naugatuck,
                Connecticut 06770

              Attention:
                William Henry

            
	
               

            	 	
               

            
	
              With
                copy to:

            	 	
              Weisman
                Celler Spett & Modlin, P.C.

              445
                Park Avenue

              New
                York, New York 10002

              Attention:
                Gerald Gordon

            

    

    

    or
      to any
      other address as to any of the parties hereto, as such party shall designate
      in
      a written notice to the other party hereto. All notices sent pursuant to the
      terms of this section shall be deemed received (i) if personally delivered,
      then on the date of delivery, (ii) if sent by overnight, express carrier,
      then on the next federal banking day immediately following the day sent, or
      (iii) if sent by registered or certified mail, then on the earlier of the
      third federal banking day following the day sent or when actually
      received.

     

    27. Waiver
      of
      Rights. 

     

    The
      Mortgagor hereby covenants and agrees that it will not at any time insist upon
      or plead, or in any manner claim or take any advantage of, any stay, exemption
      or extension law or any so-called “Moratorium Law” now or at any time hereafter
      in force providing for the valuation or appraisement of the Premises, or any
      part thereof, prior to any sale or sales thereof to be made pursuant to any
      provisions herein contained, or to decree, judgment or order of any court of
      competent jurisdiction; or, after such sale or sales, claim or exercise any
      rights under any statute now or hereafter in force to redeem the property so
      sold, or any part thereof, or relating to the marshalling thereof, upon
      foreclosure sale or other enforcement hereof; and without limiting the
      foregoing:

     

    (a) The
      Mortgagor hereby expressly waives any and all rights of reinstatement and
      redemption, if any, under any order or decree of foreclosure of this Mortgage,
      on its own behalf and on behalf of each and every person, it being the intent
      hereof that any and all such rights of reinstatement and redemption of the
      Mortgagor and of all other persons are and shall be deemed to be hereby waived
      to the full extent permitted by the provisions of applicable law of the State
      of
      Connecticut or other applicable law;

     

    
      
        
        

      

      
        23

        
          

        

      

      
        
        

      

    

     

    (b) The
      Mortgagor will not invoke or utilize any such law or laws or otherwise hinder,
      delay or impede the execution of any right, power remedy herein or otherwise
      granted or delegated to the Mortgagee but will suffer and permit the execution
      of every such right, power and remedy as though no such law or laws had been
      made or enacted; and

     

    (c) If
      the
      Mortgagor is a trustee, the Mortgagor represents that the provisions of this
      section (including the waiver of reinstatement and redemption rights) were
      made
      at the express direction of the Mortgagor’s beneficiaries and the persons having
      the power of direction over the Mortgagor, and are made on behalf of the trust
      estate of the Mortgagor and all beneficiaries of the Mortgagor, as well as
      all
      other persons mentioned above.

     

    28. Contests.
      

     

    Notwithstanding
      anything to the contrary herein contained, the Mortgagor shall have the right
      to
      contest by appropriate legal proceedings diligently prosecuted any Taxes imposed
      or assessed upon the Premises or which may be or become a lien thereon and
      any
      mechanics’, materialmen’s or other liens or claims for lien upon the Premises
      (each, a “Contested Lien”), and no Contested Lien shall constitute an
      Event of Default hereunder, if, but only if:

     

    (a) The
      Mortgagor shall forthwith give notice of any Contested Lien to the Mortgagee
      promptly after the time that the Mortgagor has knowledge that the same shall
      have been asserted;

     

    (b) The
      Mortgagor shall either pay under protest or deposit with the Mortgagee the
      full
      amount (the “Lien Amount”) of such Contested Lien, together with such
      amount as the Mortgagee may reasonably estimate as interest or penalties which
      might arise during the period of contest; provided that in lieu of such payment
      the Mortgagor may furnish to the Mortgagee a bond or title indemnity in such
      amount and form, and issued by a bond or title insuring company, as may be
      satisfactory to the Mortgagee;

     

    (c) The
      Mortgagor shall diligently prosecute the contest of any Contested Lien by
      appropriate legal proceedings having the effect of staying the foreclosure
      or
      forfeiture of the Premises, and, if any Event of Default then shall exist under
      this Mortgage or any other Loan Document, shall permit the Mortgagee to be
      represented in any such contest and shall pay all reasonable expenses of the
      Mortgagee in so doing, including fees and expenses of the Mortgagee’s counsel
      (all of which amounts expended by the Mortgagee shall be payable by the
      Mortgagor after demand and, after demand, shall constitute so much additional
      Indebtedness, bearing interest (at the Default Rate, if applicable) until
      paid);

     

    (d) The
      Mortgagor shall pay each such Contested Lien and all Lien Amounts together
      with
      interest and penalties thereon (i) if and to the extent that any such
      Contested Lien shall be determined adverse to the Mortgagor, or
      (ii) forthwith upon demand by the Mortgagee if, in the reasonable opinion
      of the Mortgagee, and notwithstanding any such contest, the Premises shall
      be in
      imminent jeopardy or in danger of being forfeited or foreclosed; provided that
      if the Mortgagor shall fail so to do, the Mortgagee may, but shall not be
      required to, pay all such Contested Liens and Lien Amounts and interest and
      penalties thereon and such other sums as may be necessary in the judgment of
      the
      Mortgagee to obtain the release and discharge of such liens; and any amount
      expended by the Mortgagee in so doing shall be payable by the Mortgagor after
      demand and, after demand, shall constitute so much additional Indebtedness,
      bearing interest (at the Default Rate, if applicable) until paid; and provided
      further that the Mortgagee may in such case use and apply monies deposited
      as
      provided in subsection (b) above and may demand payment upon any bond or
      title indemnity furnished as aforesaid.

     

    
      
        
        

      

      
        24

        
          

        

      

      
        
        

      

    

     

    29. Expenses
      Relating to Note and Mortgage. 

     

    (a) The
      Mortgagor will pay all reasonable out-of-pocket expenses, charges, costs and
      fees relating to the Loan or necessitated by the terms of the Note, this
      Mortgage or any of the other Loan Documents, including without limitation,
      the
      Mortgagee’s reasonable attorneys’ fees in connection with the negotiation,
      documentation, administration, servicing and enforcement of the Note, this
      Mortgage and the other Loan Documents, all filing, registration and recording
      fees, all other expenses incident to the execution and acknowledgment of this
      Mortgage and all federal, state, county and municipal taxes, and other taxes
      (provided the Mortgagor shall not be required to pay any income or franchise
      taxes of the Mortgagee), duties, imposts, assessments and charges arising out
      of
      or in connection with the execution and delivery of the Note and this Mortgage.
      The Mortgagor recognizes that, during the term of this Mortgage, the
      Mortgagee:

     

    (i) May
      be
      involved in court or administrative proceedings, including, without restricting
      the foregoing, foreclosure, probate, bankruptcy, creditors’ arrangements,
      insolvency, housing authority and pollution control proceedings of any kind,
      to
      which the Mortgagee shall be a party by reason of the Loan Documents or in
      which
      the Loan Documents or the Premises are involved directly or
      indirectly;

     

    (ii) May
      make
      preparations following the occurrence of an Event of Default hereunder for
      the
      commencement of any suit for the foreclosure hereof, which may or may not be
      actually commenced;

     

    (iii) May
      make
      preparations following the occurrence of an Event of Default hereunder for,
      and
      do work in connection with, the Mortgagee’s taking possession of and managing
      the Premises, which event may or may not actually occur;

     

    (iv) May
      make
      preparations for and commence other private or public actions to remedy an
      Event
      of Default hereunder, which other actions may or may not be actually
      commenced;

     

    (v) May
      enter
      into negotiations with the Mortgagor or any of its agents, employees or
      attorneys in connection with the existence or curing of any Event of Default
      hereunder, the sale of the Premises, the assumption of liability for any of
      the
      Indebtedness or the transfer of the Premises in lieu of foreclosure;
      or

     

    (vi) May
      enter
      into negotiations with the Mortgagor or any of its agents, employees or
      attorneys pertaining to the Mortgagee’s approval of actions taken or proposed to
      be taken by the Mortgagor which approval is required by the terms of this
      Mortgage.

     

    (b) All
      such
      reasonable out-of-pocket expenses, charges, costs and fees described in this
      section expended by the Mortgagee shall be payable by the Mortgagor after demand
      and, after demand, shall constitute so much additional Indebtedness, bearing
      interest (at the Default Rate, if applicable) until paid.

     

    
      
        
        

      

      
        25

        
          

        

      

      
        
        

      

    

     

    30. Financial
      Statements.

     

    Within
      ten (10) days after the filing thereof, the Mortgagor shall deliver to the
      Mortgagee true and complete copies of all quarterly and annual financial
      statements of the Mortgagor and/or the Guarantor filed with the Securities
      and
      Exchange Commission.

     

    31. Statement
      of Indebtedness. 

     

    The
      Mortgagor, within seven business days after being so requested by the Mortgagee,
      shall furnish a duly acknowledged written statement setting forth the amount
      of
      the debt secured by this Mortgage, the date to which interest has been paid
      and
      stating either that no offsets or defenses exist against such debt or, if such
      offsets or defenses are alleged to exist, the nature thereof.

     

    32. Further
      Instruments. 

     

    Upon
      request of the Mortgagee, the Mortgagor shall execute, acknowledge and deliver
      all such additional instruments and further assurances of title and shall do
      or
      cause to be done all such further acts and things as may reasonably be necessary
      fully to effectuate the intent of this Mortgage and of the other Loan
      Documents.

     

    33. Additional
      Indebtedness Secured. 

     

    All
      persons and entities with any interest in the Premises or about to acquire
      any
      such interest should be aware that this Mortgage secures more than the stated
      principal amount of the Note and interest thereon; this Mortgage secures any
      and
      all other amounts which may become due under the Note or any of the other Loan
      Documents, including, without limitation, any and all amounts expended by the
      Mortgagee, in accordance with the terms of this Mortgage or applicable law,
      to
      operate, manage or maintain the Premises or to otherwise protect the Premises
      or
      the lien of this Mortgage.

     

    34. Indemnity.
      

     

    The
      Mortgagor hereby covenants and agrees that no liability shall be asserted or
      enforced by the Mortgagor against the Mortgagee in the exercise of the rights
      and powers granted to the Mortgagee in this Mortgage, and the Mortgagor hereby
      expressly waives and releases any such liability,
      except
      to
      the extent resulting from the gross negligence or willful misconduct of the
      Mortgagee. The Mortgagor shall indemnify and save the Mortgagee harmless from
      and against any and all liabilities, obligations, losses, damages, claims,
      costs
      and expenses, including reasonable attorneys’ fees and court costs
      (collectively, “Claims”), of whatever kind or nature which may be imposed
      on, incurred by or asserted against the Mortgagee at any time by any third
      party
      which relate to or arise from: (a) any suit or proceeding (including
      probate and bankruptcy proceedings), or the threat thereof, in or to which
      the
      Mortgagee may or does become a party, either as plaintiff or as a defendant,
      by
      reason of this Mortgage or for the purpose of protecting the lien of this
      Mortgage; and (b) the ownership, leasing, use, operation or maintenance of
      the Premises, if such Claims relate to or arise from actions taken prior to
      the
      surrender of possession of the Premises to the Mortgagee in accordance with
      the
      terms of this Mortgage; provided, however, that the Mortgagor shall not be
      obligated to indemnify or hold the Mortgagee harmless from and against any
      Claims directly arising from the gross negligence or willful misconduct of
      the
      Mortgagee. All costs provided for herein and paid for by the Mortgagee shall
      be
      so much additional Indebtedness and shall become immediately due and payable
      upon demand by the Mortgagee and with interest thereon from the date incurred
      by
      the Mortgagee until paid at the Default Rate.

     

    
      
        
        

      

      
        26

        
          

        

      

      
        
        

      

    

     

    35. Subordination
      of Property Manager’s Lien. 

     

    Any
      property management agreement for the Premises entered into hereafter with
      a
      property manager shall contain a provision whereby the property manager agrees
      that any and all mechanics’ lien rights that the property manager or anyone
      claiming by, through or under the property manager may have in the Premises
      shall be subject and subordinate to the lien of this Mortgage and shall provide
      that the Mortgagee may terminate such agreement, without penalty or cost, at
      any
      time after the occurrence of an Event of Default which is continuing hereunder.
      Such property management agreement or a short form thereof, at the Mortgagee’s
      request, shall be recorded with the Recorder of Deeds of the county where the
      Premises are located. In addition, if the property management agreement in
      existence as of the date hereof, if any, does not contain a subordination
      provision, the Mortgagor shall cause the property manager under such agreement
      to enter into a subordination of the management agreement with the Mortgagee,
      in
      recordable form, whereby such property manager subordinates present and future
      lien rights and those of any party claiming by, through or under such property
      manager to the lien of this Mortgage.

     

    36. Compliance
      with Environmental Laws. 

     

    Concurrently
      herewith the Mortgagor and
      the
      Guarantor have executed and delivered to the Mortgagee that certain
      Environmental Indemnity Agreement dated as of the date hereof (the
“Indemnity”) pursuant to which the Mortgagor and the Guarantor have
      indemnified the Mortgagee for environmental matters concerning the Premises,
      as
      more particularly described therein.

     

    37. Miscellaneous.
      

     

    (a) Successors
      and Assigns. This Mortgage and all provisions hereof shall be binding upon
      and enforceable against the Mortgagor and its assigns and other successors.
      This
      Mortgage and all provisions hereof shall inure to the benefit of the Mortgagee,
      its successors and assigns and the holder or holders, from time to time, of
      the
      Note.

     

    (b) Invalidity
      of Provisions; Governing Law. In the event that any provision of this
      Mortgage is deemed to be invalid by reason of the operation of law, or by reason
      of the interpretation placed thereon by any administrative agency or any court,
      the Mortgagor and the Mortgagee shall negotiate an equitable adjustment in
      the
      provisions of the same in order to effect, to the maximum extent permitted
      by
      law, the purpose of this Mortgage and the validity and enforceability of the
      remaining provisions, or portions or applications thereof, shall not be affected
      thereby and shall remain in full force and effect. This Mortgage is to be
      construed in accordance with and governed by the applicable laws of the State
      of
      Connecticut.

     

    (c) Rights
      of Tenants. The Mortgagee shall have the right and option to commence a
      civil action to foreclose this Mortgage and to obtain a decree of foreclosure
      and sale subject to the rights of any tenant or tenants of the Premises having
      an interest in the Premises prior to that of the Mortgagee. The failure to
      join
      any such tenant or tenants of the Premises as party defendant or defendants
      in
      any such civil action or the failure of any decree of foreclosure and sale
      to
      foreclose their rights shall not be asserted by the Mortgagor as a defense
      in
      any civil action instituted to collect the Indebtedness, or any part thereof
      or
      any deficiency remaining unpaid after foreclosure and sale of the Premises,
      any
      statute or rule of law at any time existing to the contrary
      notwithstanding.

     

    (d) Option
      of Mortgagee to Subordinate. At the option of the Mortgagee, this Mortgage
      shall become subject and subordinate, in whole or in part (but not with respect
      to priority of entitlement to insurance proceeds or any condemnation or eminent
      domain award) to any and all leases of all or any part of the Premises upon
      the
      execution by the Mortgagee of a unilateral declaration to that effect and the
      recording thereof in the Office of the Recorder of Deeds in and for the county
      wherein the Premises are situated.

     

    
      
        
        

      

      
        27

        
          

        

      

      
        
        

      

    

     

    (e) Mortgagee-in-Possession.
      Nothing herein contained shall be construed as constituting the Mortgagee a
      mortgagee-in-possession in the absence of the actual taking of possession of
      the
      Premises by the Mortgagee pursuant to this Mortgage.

     

    (f) Relationship
      of Mortgagee and Mortgagor. The Mortgagee shall in no event be construed for
      any purpose to be a partner, joint venturer, agent or associate of the Mortgagor
      or of any lessee, operator, concessionaire or licensee of the Mortgagor in
      the
      conduct of their respective businesses, and, without limiting the foregoing,
      the
      Mortgagee shall not be deemed to be such partner, joint venturer, agent or
      associate on account of the Mortgagee becoming a mortgagee-in-possession or
      exercising any rights pursuant to this Mortgage, any of the other Loan
      Documents, or otherwise. The relationship of the Mortgagor and the Mortgagee
      hereunder is solely that of debtor/creditor.

     

    (g) No
      Merger. The parties hereto intend that the Mortgage and the lien hereof
      shall not merge in fee simple title to the Premises, and if the Mortgagee
      acquires any additional or other interest in or to the Premises or the ownership
      thereof, then, unless a contrary intent is manifested by the Mortgagee as
      evidenced by an express statement to that effect in an appropriate document
      duly
      recorded, this Mortgage and the lien hereof shall not merge in the fee simple
      title and this Mortgage may be foreclosed as if owned by a stranger to the
      fee
      simple title.

     

    (h) OPEN
      END MORTGAGE. This
      is
      an “open-end” mortgage and the holder hereof shall have all the rights, powers
      and protection to which the holder of any open-end mortgage is entitled,
      including, without limitation, those rights, powers and protections included
      in
      Conn. Gen. Stat. sec. 49-2, as may be amended. It is further agreed that upon
      request of the Mortgagor, the Mortgagee may hereafter, at its sole option,
      at
      any time before full payment of this Mortgage, make further advances to the
      Mortgagor in amounts and at such rates of interest as the Mortgagee shall
      determine in accordance with the provisions of the Loan Documents, and every
      such further advance shall be secured by this Mortgage and evidenced by the
      Loan
      Documents, which may include commercial revolving loans, provided, that the
      amount of the principal secured by this Mortgage and remaining unpaid shall
      at
      no time exceed the original principal sum secured hereby and provided that
      the
      time of repayment of such advancement shall not extend the time of repayment
      beyond the maturity of the original debt hereby secured.

     

    (i) CONSENT
      TO JURISDICTION. TO INDUCE THE PARTIES TO EXECUTE AND ACCEPT THE NOTE, EACH
      OF THE MORTGAGOR AND, BY ITS ACCEPTANCE HEREOF, THE MORTGAGEE IRREVOCABLY AGREES
      THAT ALL ACTIONS OR PROCEEDINGS IN ANY WAY ARISING OUT OF OR RELATED TO THE
      NOTE
      AND THIS MORTGAGE WILL BE LITIGATED IN COURTS HAVING SITUS IN THE COUNTY OF
      NEW
      HAVEN, CONNECTICUT. EACH OF THE MORTGAGOR AND, BY ITS ACCEPTANCE HEREOF, THE
      MORTGAGEE HEREBY CONSENTS AND SUBMITS TO THE JURISDICTION OF ANY COURT LOCATED
      WITHIN THE COUNTY OF NEW HAVEN, CONNECTICUT, WAIVES PERSONAL SERVICE OF PROCESS
      UPON IT, AND AGREES THAT ALL SUCH SERVICE OF PROCESS MAY BE MADE BY REGISTERED
      MAIL DIRECTED TO IT AT THE ADDRESS FOR IT STATED HEREIN AND SERVICE SO MADE
      WILL
      BE DEEMED TO BE COMPLETED UPON ACTUAL RECEIPT.

     

    
      
        
        

      

      
        28

        
          

        

      

      
        
        

      

    

     

    (j) WAIVER
      OF JURY TRIAL. THE MORTGAGOR AND THE MORTGAGEE (BY ACCEPTANCE HEREOF),
      HAVING BEEN REPRESENTED BY COUNSEL EACH KNOWINGLY AND VOLUNTARILY WAIVES ANY
      RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY
      RIGHTS (A) UNDER THIS MORTGAGE OR ANY RELATED AGREEMENT OR UNDER ANY
      AMENDMENT, INSTRUMENT, DOCUMENT OR AGREEMENT DELIVERED OR WHICH MAY IN THE
      FUTURE BE DELIVERED IN CONNECTION WITH THIS MORTGAGE OR (B) ARISING FROM
      ANY BANKING RELATIONSHIP EXISTING IN CONNECTION WITH THIS MORTGAGE, AND AGREES
      THAT ANY SUCH ACTION OR PROCEEDING WILL BE TRIED BEFORE A COURT AND NOT BEFORE
      A
      JURY. EACH OF THE MORTGAGOR AND, BY ITS ACCEPTANCE HEREOF, THE MORTGAGEE AGREES
      THAT IT WILL NOT ASSERT ANY CLAIM AGAINST THE OTHER OR ANY OTHER PERSON
      INDEMNIFIED UNDER THIS MORTGAGE ON ANY THEORY OF LIABILITY FOR SPECIAL,
      INDIRECT, CONSEQUENTIAL, INCIDENTAL OR PUNITIVE DAMAGES.

     

    (k) Complete
      Agreement. This Mortgage, the Note and the other Loan Documents constitute
      the complete agreement between the parties with respect to the subject matter
      hereof and the Loan Documents may not be modified, altered or amended except
      by
      an agreement in writing signed by both the Mortgagor and the
      Mortgagee.

     

    (l) Collateral
      Assignment. The Mortgagor acknowledges that the Mortgagee has collaterally
      assigned its rights in the Note and all Loan Documents to JPMorgan
      Chase Bank National Association, its successors and assigns
      (the
“Mortgagee’s Bank”). The Mortgagee’s Bank may file a Uniform Commercial Code
      statement in
      the
      office of the Secretary of State of the State of Delaware
      identifying the Mortgagee’s Bank’s interest in the Mortgagee’s rights in the
      Note and all Loan Documents.
      The
      Mortgagee may be required by
      the
      Mortgagee’s Bank to
      deliver to the Mortgagee’s Bank
      the
      executed original of each document evidencing or securing the Loan, and until
      so
      delivered, such documents shall be held by the Mortgagee in trust for the
      Mortgagee’s Bank.

     

    (m) Nature
      of Obligation. This Mortgage and the other Loan Documents are corporate
      obligation of the Mortgagor and/or the Guarantor, as applicable, and no recourse
      may be had hereunder or thereunder against any officer, director or stockholder
      of the Mortgagor or the Guarantor.

     

    [SIGNATURE
      PAGE FOLLOWS]

     

    
      
        
        

      

      
        29

        
          

        

      

      
        
        

      

    

    IN
      WITNESS WHEREOF, the Mortgagor has executed and delivered this Mortgage,
      Security Agreement, Assignment of Rents and Leases and Fixture Filing the day
      and year first above written.

    

    
      	
              WITNESSES:

               

              _____________________________________

              Name:
                _______________________________

               

               

              _____________________________________

              Name:
                _______________________________

               

            	 	
              GDC
                NAUGATUCK, INC.,
                a
                Delaware corporation

               

              By:______________________________________

              Name:____________________________________

              Title:
                ____________________________________

            

    

    

    
      
        
        

      

      
        30

        
          

        

      

      
        
        

      

    

     

    
      	STATE OF __________ 	)	 
	 	)
              SS.	 
	COUNTY OF ________ 	)	 

    

     

    The
      undersigned, a Notary Public in and for the said County, in the State aforesaid,
      DO HEREBY CERTIFY that ________________________, the ___________________of
      GDC
      Naugatuck, Inc., a Delaware corporation, who is personally known to me to be
      the
      same person whose name is subscribed to the foregoing instrument as such
      _______________________, appeared before me this day in person and acknowledged
      that he/she signed and delivered the said instrument as his/her own free and
      voluntary act and as the free and voluntary act of said corporation,
      for the uses and purposes therein set forth.

     

    GIVEN
      under my hand and notarial seal this _____ day of July, 2007

     

    
      	 	 	 
	 	
              

              Notary
                Public

            
	 	 
	 	My
              Commission Expires:
	 	 
	 	 
	 	
              

            

    

     

    
      
        
        

      

      
        31

        
          

        

      

      
        
        

      

    

     

    EXHIBIT ”A”

     

    LEGAL
      DESCRIPTION OF REAL ESTATE

     

    Permanent
      Tax Index Number:

     

    ________________________

     

    Property
      Address:

     

    6
      Rubber
      Avenue

    Naugatuck,
      Connecticut

    

    

    (See
      attached Schedule A)

     

    
      
        
        

      

      
        A-1

        
          

        

      

      
        
        

      

    

    EXHIBIT
      “B”

     

    PERMITTED
      EXCEPTIONS

     

    
      	
              1.

            	
              
                Tenants
                  occupying the Premises or any portion thereof under leases or other
                  use
                  and occupancy agreement approved by the Mortgagee, to the extent
                  such
                  approval is required by the terms of the Mortgage (including General
                  DataComm, Inc. under its Lease of even date with the
                  Mortgage).

              

            

    

    

    
      	
              2.

            	
              Exceptions
                listed on Schedule B of the Title Insurance Policy delivered at the
                closing of the Loan insuring the liens in the Real Estate and Improvements
                granted by the Mortgagor in favor of the
                Mortgagee.

            

    

     

    
      	
              3.

            	
              Open
                End Mortgage Deed and Security Agreement from the Mortgagor to Howard
                S.
                Modlin and John L. Segall in the original principal amount of
                $2,080,945.21 dated December 7, 2006, and recorded in Volume 785
                at Page
                814 of the Naugatuck Land Records, and Additional Senior Security
                Agreement dated December 30, 2003, each of which secures the Subordinate
                Indebtedness and is subordinated to this Mortgage (to the extent
                of the
                Collateral hereunder) pursuant to the terms of the Subordination
                and
                Intercreditor Agreement dated as of even date among Howard S. Modlin,
                John
                L. Segall and the Mortgagee (nothing herein shall prevent the holder
                of
                such mortgage and security agreement from making further advances
                of
                principal, permitting interest on the Subordinate Indebtedness to
                accrue
                and be added to the principal thereof or releasing, compromising
                or
                forgiving the Subordinate Indebtedness or the extension of maturity
                or
                renewal thereof).

            

    

     

    
      	
              4.

            	
              Liens
                and encumbrances granted by the Mortgagor in favor of the Mortgagee
                to
                secure the Mortgagor’s Indebtedness pursuant to the Loan
                Documents.

            

    

     

    
      	
              5.

            	
              Liens
                and encumbrances on personal property (excluding any real property)
                of the
                Mortgagor granted by the Mortgagor in favor of HSBC Bank USA, NA,
                as
                Trustee (“HSBC”), pursuant to that certain Subordinated Security Agreement
                dated September 15, 2003, among General DataComm Industries, Inc.,
                the
                Mortgagor, certain additional parties and
                HSBC.

            

    

     

    
      	6.	
              Liens
                for Taxes not yet due and payable, liens being contested by the Mortgagor
                in accordance with the terms of the Loan Documents and utility, access
                and
                similar easements which do not materially interfere with or impair
                the
                use, value or operation of the
                Premises.

            

    

     

    
      
        
        

      

      
        B-1

        
          

        

      

      
        
        

      

    

     

    EXHIBIT
      “C”

     

    LIST
      OF INSURANCE POLICIES

     

    Each
      of
      the insurance policies evidenced by the Certificates of Insurance attached
      hereto (see attachment).

     

    
      
        
        

      

      
        C-1

        
          

        

      

      
        
        

      

    

    EXHIBIT
      “D”

     

    MORTGAGE
      NOTE

     

    (See
      Attached)

     

    
      
        
        

      

      
        D-1

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