Document:

Exhibit
10.46

THIRD AMENDMENT TO
CREDIT AGREEMENT

THIS AMENDMENT TO
CREDIT AGREEMENT (this “Amendment”) is entered into as of July 3, 2006, by and
between SYMMETRICOM, INC., a Delaware corporation (“Borrower”), and WELLS FARGO
BANK, NATIONAL ASSOCIATION (“Bank”).

RECITALS

WHEREAS, Borrower
is currently indebted to Bank pursuant to the terms and conditions of that
certain Credit Agreement between Borrower and Bank dated as of May 1, 2004, as
amended from time to time (“Credit Agreement).

WHEREAS, Bank and
Borrower have agreed to certain changes in the terms and conditions set forth
in the Credit Agreement and have agreed to amend the Credit Agreement to
reflect said changes.

NOW, THEREFORE,
for valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree that the Credit Agreement shall be
amended as follows:

1.             Section 1.1 (a) is hereby amended
by deleting “Ten Million Dollars ($10,000,000.00)” as the maximum principal
amount available under the Line of Credit, and by substituting for said amount “Three
Million Dollars ($3,000,000.00),” with such change to be effective upon the
execution and delivery to Bank of a promissory note dated as of July 3, 2006
(which promissory note shall replace and be deemed the Line of Credit Note
defined in and made pursuant to the Credit Agreement) and all other contracts,
instruments and documents required by Bank to evidence such change.

2.             Section 1.1 (b) is hereby deleted
in its entirety, and the following substituted therefore:

“(b)         Letter
of Credit Subfeature.  As a
subfeature under the Line of Credit, Bank agrees from time to time during the
term thereof to issue or cause an affiliate to issue standby letters of credit
for the account of Borrower (each, a “Letter of Credit” and collectively, “Letters
of Credit”); provided however, that the aggregate undrawn amount of all
outstanding Letters of Credit shall not at any time exceed three Million
Dollars ($3,000,000.00).  The form and
substance of each Letter of Credit shall be subject to approval by Bank, in its
sole discretion.  Each Letter of Credit
shall be issued for a term not to exceed three hundred sixty five (365) days, as
designated by Borrower; provided however, that no Letter of Credit shall have
an expiration date more than three hundred sixty five (365) days beyond the
maturity date of the Line of Credit.  The
undrawn amount of all Letters of Credit shall be reserved under the Line of
Credit and shall not be available for borrowings thereunder.  Each Letter of Credit shall be subject to the
additional terms and conditions of the Letter of Credit agreements,
applications and any related documents required by Bank in connection with the
issuance thereof. Each drawing paid under a Letter of Credit shall be deemed an
advance under the Line of Credit and shall be repaid by Borrower in accordance
with the terms and conditions of this Agreement applicable to such advances;
provided however, that if advances under the Line of Credit are not available, for
any reason, at the time any drawing is paid, then Borrower shall immediately
pay to Bank the full amount drawn, together with interest thereon from the date
such drawing is paid to the date such amount is fully repaid by Borrower, at
the rate of interest applicable to advances under the Line of Credit. In such
event Borrower agrees that Bank, in its sole discretion, may debit any account
maintained by Borrower with Bank for the amount of any such drawing.”

 

3.             The following is hereby added to
the Credit Agreement as Section 1.4:

“SECTION 1.4.   
COLLECTION OF PAYMENTS.  Borrower
authorizes Bank to collect all interest and fees due under each credit subject
hereto by charging Borrower’s deposit account number 4121-042253 with Bank, or
any other deposit account maintained by Borrower with Bank, for the full amount
thereof.  Should there be insufficient
funds in any such deposit account to pay all such sums when due, the full
amount of such deficiency shall be immediately due and payable by Borrower.

4.             Except as specifically provided
herein, all terms and conditions of the Credit Agreement remain in full force
and effect, without waiver or modification. 
All terms defined in the Credit Agreement shall have the same meaning
when used in this Amendment.  This
Amendment and the Credit Agreement shall be read together, as one document.

5.             Borrower hereby remakes all
representations and warranties contained in the Credit Agreement and reaffirms
all covenants set forth therein. 
Borrower further certifies that as of the date of this Amendment there
exists no Event of Default as defined in the Credit Agreement, nor any
condition, act or event which with the giving of notice or the passage of time
or both would constitute any such Event of Default.

IN
WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed
as of the day and year first written above.

 

	
  SYMMETRICOM, INC.

  	
  WELLS FARGO BANK NATIONAL ASSOCIATION

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ William
  Slater

  	
   

  	
  By: 

  	
  /s/ Kevin Herr

  	
   

  
	
   

  	
  William Slater

  	
   

  	
  Kevin Herr

  
	
   

  	
  Chief Financial
  Officer

  	
   

  	
  Vice President

  
								

 

 

 

WELLS FARGO                                            REVOLVING LINE OF CREDIT
NOTE

	
  $3,000,000.00

  	
  San
  Jose, California

  	
   

  
	
   

  	
  July 3,
  2006

  	
   

  

 

FOR VALUE
RECEIVED, the undersigned SYMMETRICOM,
INC.  (“Borrower”) promises to
pay to the order of WELLS FARGO BANK, NATIONAL ASSOCIATION (“Bank”) at its
office at Santa Clara Technology RCBO, 121
Park Center Plaza, 3rd Floor, San Jose, CA 95113, or at such
other place as the holder hereof may designate, in lawful money of the United
States of America and in immediately available funds, the principal sum of $3,000,000.00, or so much thereof as may be
advanced and be outstanding, with interest thereon, to be computed on each
advance from the date of its disbursement as set forth herein.

1.             DEFINITIONS:

As
used herein, the following terms shall have the meanings set forth after each,
and any other term defined in this Note shall have the meaning set forth at the
place defined:

1.1           “Business
Day” means any day except a Saturday, Sunday or any other day on which
commercial banks in California are authorized or required by law to close.

1.2           “Fixed
Rate Term” means a period commencing on a Business Day and continuing for 1, 2 or 3 months, as designated by
Borrower, during which all or a portion of the outstanding principal balance of
this Note bears interest determined in relation to LIBOR; provided however,
that no Fixed Rate Term may be selected for a principal amount less than $100,000.00; and provided further, that no
Fixed Rate Term shall extend beyond the scheduled maturity date hereof.  If any Fixed Rate Term would end on a day
which is not a Business Day, then such Fixed Rate Term shall be extended to the
next succeeding Business Day.

1.3           “LIBOR”
means the rate per annum (rounded upward, if necessary, to the nearest whole
1/8 of 1%) determined by dividing Base LIBOR by a percentage equal to 100% less
any LIBOR Reserve Percentage.

(a)      “Base
LIBOR” means the rate per annum for United States dollar deposits quoted by
Bank as the Inter-Bank Market Offered Rate, with the understanding that such
rate is quoted by Bank for the purpose of calculating effective rates of
interest for loans making reference thereto, on the first day of a Fixed Rate
Term for delivery of funds on said date for a period of time approximately
equal to the number of days in such Fixed Rate Term and in an amount
approximately equal to the principal amount to which such Fixed Rate Term
applies.  Borrower understands and agrees
that Bank may base its quotation of the Inter-Bank Market Offered Rate upon
such offers or other market indicators of the Inter-Bank Market as Bank in its
discretion deems appropriate including, but not limited to, the rate offered
for U.S. dollar deposits on the London Inter-Bank Market.

(b)      “LIBOR
Reserve Percentage” means the reserve percentage prescribed by the Board of
Governors of the Federal Reserve System (or any successor) for “Eurocurrency
Liabilities” (as defined in Regulation D of the Federal Reserve Board, as
amended), adjusted by Bank for expected changes in such reserve percentage
during the applicable Fixed Rate Term.

1.4           “Prime
Rate” means at any time the rate of interest most recently announced within
Bank at its principal office as its Prime Rate, with the understanding that the
Prime Rate is one of Bank’s base rates and serves as the basis upon which
effective rates of interest are calculated for those loans making reference
thereto, and is evidenced by the recording thereof after its announcement in
such internal publication or publications as Bank may designate.

2.             INTEREST:

2.1           Interest.  The outstanding principal balance of this
Note shall bear interest (computed on the basis of a 360-day year, actual days elapsed) either (a) at a fluctuating
rate per annum equal to the Prime
Rate in effect from time to time, or (b) at a fixed rate per annum determined
by Bank to be 1.75000% above LIBOR
in effect on the first day of the applicable Fixed Rate Term.  When interest is determined in relation to
the Prime Rate, each change in the rate of interest hereunder shall become
effective on the date each Prime Rate change is announced within Bank.  With respect to each LIBOR selection option
selected hereunder, Bank is hereby authorized to note the date, principal
amount, interest rate and Fixed Rate Term applicable thereto and any payments
made thereon on Bank’s books and records (either manually or by electronic
entry) and/or on any schedule attached to this Note, which notations shall be
prima facie evidence of the accuracy of the information noted.

 

2.2           Selection
of Interest Rate Options.  At any
time any portion of this Note bears interest determined in relation to LIBOR,
it may be continued by Borrower at the end of the Fixed Rate Term applicable
thereto so that all or a portion thereof bears interest determined in relation
to the Prime Rate or to LIBOR for a new Fixed Rate Term designated by
Borrower.  At any time any portion of
this Note bears interest determined in relation to the Prime Rate, Borrower may
convert all or a portion thereof so that it bears interest determined in
relation to LIBOR for a Fixed Rate Term designated by Borrower.  At such time as Borrower requests an advance
hereunder or wishes to select a LIBOR option for all or a portion of the
outstanding principal balance hereof, and at the end of each Fixed Rate Term,
Borrower shall give Bank notice specifying: (a) the interest rate option
selected by Borrower; (b) the principal amount subject thereto; and (c) for
each LIBOR selection, the length of the applicable Fixed Rate Term.  Any such notice may be given by telephone (or
such other electronic method as Bank may permit) so long as, with respect to
each LIBOR selection, (i) if requested by Bank, Borrower provides to Bank
written confirmation thereof not later than 3 Business Days after such notice is
given, and (ii) such notice is given to Bank prior to 10:00 a.m. on the first
day of the Fixed Rate Term, or at a later time during any Business Day if Bank,
at it’s sole option but without obligation to do so, accepts Borrower’s notice
and quotes a fixed rate to Borrower.  If
Borrower does not immediately accept a fixed rate when quoted by Bank, the
quoted rate shall expire and any subsequent LIBOR request from Borrower shall
be subject to a redetermination by Bank of the applicable fixed rate.  If no specific designation of interest is
made at the time any advance is requested hereunder or at the end of any Fixed
Rate Term, Borrower shall be deemed to have made a Prime Rate interest
selection for such advance or the principal amount to which such Fixed Rate
Term applied.

2.3           Taxes
and Regulatory Costs.  Borrower shall
pay to Bank immediately upon demand, in addition to any other amounts due or to
become due hereunder, any and all (a) withholdings, interest equalization
taxes, stamp taxes or other taxes (except income and franchise taxes) imposed
by any domestic or foreign governmental authority and related in any manner to
LIBOR, and (b) future, supplemental, emergency or other changes in the LIBOR
Reserve Percentage, assessment rates imposed by the Federal Deposit Insurance
Corporation, or similar requirements or costs imposed by any domestic or
foreign governmental authority or resulting from compliance by Bank with any
request or directive (whether or not having the force of law) from any central
bank or other governmental authority and related in any manner to LIBOR to the
extent they are not included in the calculation of LIBOR.  In determining which of the foregoing is
attributable to any LIBOR option available to Borrower hereunder, any
reasonable allocation made by Bank among its operations shall be conclusive and
binding upon Borrower.

2.4           Payment
of Interest.  Interest accrued on
this Note shall be payable on the 1st day of each month,
commencing August 1, 2006.

2.5           Default
Interest.  From and after the
maturity date of this Note, or such earlier date as all principal owing
hereunder becomes due and payable by acceleration or otherwise, the outstanding
principal balance of this note shall bear interest until paid in full at an
increased rate per annum (computed on the basis of a 360-day year, actual days elapsed) equal to 4% above the rate
of interest from time to time applicable to this Note.

3.             BORROWING AND REPAYMENT:

3.1           Borrowing
and Repayment.  Borrower may from
time to time during the term of this Note borrow, partially or wholly repay its
outstanding borrowings, and reborrow, subject to all of the limitations, terms
and conditions of this Note and of the Credit Agreement between Borrower and
Bank defined below; provided however, that the total outstanding borrowings
under this Note shall not at any time exceed the principal amount stated
above.  The unpaid principal balance of
this obligation at any time shall be the total amounts advanced hereunder by
the holder hereof less the amount of principal payments made hereon by or for
Borrower, which balance may be endorsed hereon from time to time by the
holder.  The outstanding principal
balance of this Note shall be due and payable in full on November 1, 2006.

3.2           Advances.  Advances hereunder, to the total amount of
the principal sum available hereunder, may be made by the holder at the oral
and written request of (a) William Slater,
any one acting alone, who are authorized to request advances and direct the
disposition of any advances until written notice of the revocation of such
authority is received by the holder at the office designated above, or (b) any
person, with respect to advances deposited to the credit of any deposit account
of Borrower, which advances, when so deposited, shall be conclusively presumed
to have been made to or for the benefit of Borrower regardless of the fact that
persons other than those authorized to request advances may have authority to
draw against such account.  The holder
shall have no obligation to determine whether any person requesting an advance
is or has been authorized by Borrower.

3.3           Application
of Payments.  Each payment made on
this Note shall be credited first, to any interest then due and second, to the
outstanding principal balance hereof. 
All payments credited to principal shall be applied first, to the
outstanding principal balance of this Note which bears interest determined in
relation to the Prime Rate, if any, and second, to the outstanding principal
balance of this Note which bears interest determined in relation to LIBOR, with
such payments applied to the oldest Fixed Rate Term first.

 

4.             PREPAYMENT:

4.1           Prime
Rate.  Borrower may prepay principal
on any portion of this Note which bears interest determined in relation to the
Prime Rate at any time, in any amount and without penalty.

4.2           LIBOR.  Borrower may prepay principal on any portion
of this Note which bears interest determined in relation to LIBOR at any time
and in the minimum amount of $100,000.00;
provided however, that if the outstanding principal balance of such portion of
this Note is less than said amount, the minimum prepayment amount shall be the
entire outstanding principal balance thereof. 
In consideration of Bank providing this prepayment option to Borrower,
or if any such portion of this Note shall become due and payable at any time
prior to the last day of the Fixed Rate Term applicable thereto by acceleration
or otherwise, Borrower shall pay to Bank immediately upon demand a fee which is
the sum of the discounted monthly differences for each month from the month of
prepayment through the month in which such Fixed Rate Term matures, calculated
as follows for each such month:

(a)      Determine
the amount of interest which would have accrued each month on the amount
prepaid at the interest rate applicable to such amount had it remained
outstanding until the last day of the Fixed Rate Term applicable thereto.

(b)      Subtract
from the amount determined in (a) above the amount of interest which would have
accrued for the same month on the amount prepaid for the remaining term of such
Fixed Rate Term at LIBOR in effect on the date of prepayment for new loans made
for such term and in a principal amount equal to the amount prepaid.

(c)      If
the result obtained in (b) for any month is greater than zero, discount that
difference by LIBOR used in (b) above.

Borrower acknowledges that prepayment of such amount
may result in Bank incurring additional costs, expenses and/or liabilities, and
that it is difficult to ascertain the full extent of such costs, expenses
and/or liabilities.  Borrower, therefore,
agrees to pay the above-described prepayment fee and agrees that said amount
represents a reasonable estimate of the prepayment costs, expenses and/or
liabilities of Bank.  If Borrower fails
to pay any prepayment fee when due, the amount of such prepayment fee shall
thereafter bear interest until paid at a rate per annum 2.000% above the Prime Rate in effect from
time to time (computed on the basis of a 360-day
year, actual days elapsed).

5.             EVENTS OF DEFAULT:

This
Note is made pursuant to and is subject to the terms and conditions of that
certain Credit Agreement between Borrower and Bank dated as of May 1, 2004, as
amended from time to time (the “Credit Agreement”).  Any default in the payment or performance of
any obligation under this Note, or any defined event of default under the
Credit Agreement, shall constitute an “Event of Default” under this Note.

6.             MISCELLANEOUS:

6.1           Remedies.  Upon the occurrence of any Event of Default,
the holder of this Note, at the holder’s option, may declare all sums of
principal and interest outstanding hereunder to be immediately due and payable
without presentment, demand, notice of nonperformance, notice of protest,
protest or notice of dishonor, all of which are expressly waived by Borrower,
and the obligation, if any, of the holder to extend any further credit
hereunder shall immediately cease and terminate.  Borrower shall pay to the holder immediately
upon demand the full amount of all payments, advances, charges, costs and
expenses, including reasonable attorneys’ fees (to include outside counsel fees
and all allocated costs of the holder’s in-house counsel), expended or incurred
by the holder in connection with the enforcement of the holder’s rights and/or
the collection of any amounts which become due to the holder under this Note,
and the prosecution or defense of any action in any way related to this Note,
including without limitation, any action for declaratory relief, whether
incurred at the trial or appellate level, in an arbitration proceeding or
otherwise, and including any of the foregoing incurred in connection with any
bankruptcy proceeding (including without limitation, any adversary proceeding,
contested matter or motion brought by Bank or any other person) relating to
Borrower or any other person or entity.

6.2           Obligations
Joint and Several.  Should more than
one person or entity sign this Note as a Borrower, the obligations of each such
Borrower shall be joint and several.

6.3           Governing
Law.  This Note shall be governed by
and construed in accordance with the laws of the State of California.

IN WITNESS
WHEREOF, the undersigned has executed this Note as of the date first written
above.

	
  SYMMETRICOM, INC.

  	
   

  
	
   

  
	
  By: 

  	
  /s/ William Slater

  	
   

  
	
   

  	
  William Slater, Chief Financial OfficerExhibit
10(f)

SUBLEASE

THIS SUBLEASE (this
“Sublease”) is made and entered into as of the 22nd day of June, 2006, by and
between U.S. Traffic Corporation f/k/a Green Light Acquisition Company, a
Delaware corporation (“Landlord”), and National Signal, Inc., a California
corporation (“Tenant”).

1.                                       PRIME
LEASE.  Landlord is the tenant under that
certain Lease Agreement (the “Prime Lease”) dated May 16, 2003 with Cambridge
Leasing Corporation, a Delaware corporation, who has assigned its interest
under the Prime Lease to Greenlaw Partners LLC, 
a California limited liability company (the “Prime Landlord”), for the
lease of the building situated at 9601 and 9603 John Street, Santa Fe Springs,
California (the “Property”).  Landlord
warrants that (a) Landlord has delivered to Tenant a complete copy of the Prime
Lease and all other agreements between Prime Landlord and Landlord relating to
the leasing, use or occupancy of the Property, (b) the Prime Lease is, as of
the date of this Sublease, in full force and effect, and (c) no event of
default has occurred under the Prime Lease by any party thereto and, to
Landlord’s knowledge, no event has occurred and is continuing that would
constitute an event of default by Landlord, but for the requirement of the
giving of notice and the expiration of the period of time to cure.

2.                                       SUBLEASE.  Landlord, for and in consideration of the
rents herein reserved and of the covenants and agreements herein contained on
the part of the Tenant to be performed by Tenant, hereby subleases to Tenant
the premises shown on Exhibit A (the “Premises”) attached that are
located in the building (the “Building”), which Building is located on and a
part of the Property, and the Tenant hereby accepts the Premises from the
Landlord.

3.                                       SUBLEASE
TERM.  The term of this Sublease (the
“Term”) shall commence on the later of (a) the date hereof, and (b) the date
Prime Landlord consents in writing to this Sublease (such later date being
hereinafter referred to as the “Commencement Date”).  The Term shall expire on May 31, 2008 (the
“Expiration Date”), unless sooner terminated as otherwise provided elsewhere in
this Sublease.

4.                                       POSSESSION.  Landlord agrees to deliver possession of the
Premises on or before the Commencement Date in their condition as of the execution
and delivery hereof, reasonable wear and tear excepted; that is to say, AS
IS.  Notwithstanding the foregoing,
Landlord represents that the roofs, walls, foundations and other major
structural components of the Premises are in good repair, free from material
defects, and suitable for Tenant’s Use (as described in Section 5 below).

5.                                       TENANT’S
USE.  The Premises shall be used and
occupied only for manufacturing, sales and related office use, subject to, and
in accordance with all applicable laws, regulations, orders, codes and zoning
regulations (including the applicable certificate of occupancy), and for no
other purposes.

6.                                       RENT.  Beginning on the Commencement Date, Tenant
shall pay during the Term, as “Base Rent”, Twenty Five Thousand Six Hundred Fifty
and No/100ths Dollars ($25,650.00) per month. 
Tenant shall pay Base Rent and Additional Rent (as hereinafter defined)
to and at the address specified herein for Landlord or to such other payee or
at such other address as may be designated by notice in writing from Landlord
to Tenant, without prior demand therefor and without any deduction, setoff,
diminution, abatement, counterclaim or deduction whatsoever.  Base Rent shall be paid in equal monthly
installments in advance on the first (1st) day of each month of the Term,
except that the first installment of Base Rent shall be paid by Tenant to
Landlord upon execution of this Sublease by Tenant.  Base Rent shall be pro-rated for partial
months at the beginning and end of the Term. 
All charges, costs, and sums required to be paid by Tenant to Landlord
under Section 7 of this Sublease in addition to Base Rent shall be deemed
“Additional Rent,” and Base Rent and Additional Rent shall hereinafter
collectively be referred to as “Rent.”

7.                                       TENANT’S
OBLIGATIONS.  Tenant shall be responsible
for, and shall pay the following:  . All
utility consumption costs, including without limitation, water, sewer, gas, and
electric and other charges incurred in connection with lighting and providing
electrical power to the Premises. The foregoing notwithstanding, if the
Premises are not separately metered for utilities at any time during the Term,
Tenant agrees to pay Landlord the amount attributable to the Premises from time
to time as reasonably estimated by Landlord within ten (10) days

 

after demand by Landlord specifying such charge.  Tenant shall hold Landlord harmless from all
costs or expenses Landlord may incur from Tenant’s failure to pay utility bills
or to perform any of its obligations with respect to the purchase of utilities.

Tenant agrees that
neither Landlord nor its agents shall be liable in damages, by abatement of
Rent or otherwise, for any failure of Tenant to secure gas, electrical or other
utility services for the Premises. Tenant further agrees that neither Landlord
nor its agents shall be liable in damages, by abatement of Rent or otherwise,
for Landlord’s failure to furnish or delay in furnishing any service which
Landlord is obligated to provide pursuant to the terms and provisions of this
Sublease, if any, when such failure or delay is occasioned, in whole or in
part, by repairs, renewals or improvements, by any strike, lockout or other
labor trouble, by inability to secure electricity, gas, water, or other fuel at
the Property, by any accident or casualty whatsoever, by the act or default of
Tenant or other parties, or by any cause beyond the reasonable control of
Landlord; and such failures or delays, or the nonexistence of any utility,
whether occasioned by Landlord or some third party, shall never be deemed to
constitute an eviction or disturbance of the Tenant’s use and possession of the
Premises or relieve the Tenant from paying Rent or performing any of its
obligations under this Sublease.

8.                                       QUIET
ENJOYMENT. Landlord represents that it has full power and authority to enter
into this Sublease, subject to the consent of the Prime Landlord.  So long as no Event of Default (defined in Section 19) has occurred, Tenant’s quiet
and peaceable enjoyment of the Premises shall not be disturbed by Landlord or Prime
Landlord or by anyone claiming through Landlord or Prime Landlord.

9.                                       INSURANCE;
INDEMNITY

(a)                                  Tenant
shall keep in full force and effect a policy of commercial general liability
insurance for the Premises.  Tenant shall
furnish Landlord a certificate of insurance evidencing such coverage and naming
Landlord as an additional insured therein. 
Tenant’s insurer shall agree to furnish Landlord at least ten (10) days’
advance written notice of any cancellation of coverage.  Renewal certificates shall be supplied
promptly following the expiration of the current certificate.

(b)                                 Tenant
shall indemnify Landlord from all liability, loss or other damage claims for
obligations resulting from any bodily injuries or losses to persons or property
occurring in or on the Premises and caused by the negligence or willful
misconduct of Tenant, its agents, employees, contractors or invitees, including
reasonable attorneys’ fees and court costs incurred by Landlord in defending
any such claims, except when caused by the negligence of Landlord or its
agents, employees, contractors or invitees.

(c)                                  Landlord,
at its sole cost and expense, shall continuously maintain in full force and
effect during the Term a policy or policies of insurance insuring the Building
against loss or damage by fire and extended perils and other perils for the
full replacement cost of the Building. 
Landlord shall keep in full force and effect a policy of commercial
general liability insurance for the Property.

(d)                                 Anything
in this Sublease to the contrary notwithstanding, Landlord and Tenant each
hereby waives any and all rights of recovery, claim, action or cause of action
against the other for any loss or damage that may occur to the Premises or any
improvements thereto, or any personal property of Landlord or Tenant, arising
from any cause that (a) would be insured against under the terms of any
property insurance required to be carried hereunder; or (b) is insured against
under the terms of any property insurance actually carried, regardless of whether
the same is required hereunder.  The
foregoing waiver shall apply regardless of the cause or origin of such claim,
including, but not limited to, the negligence of a party or such party’s
agents, officers, employees or contractors. 
The foregoing waiver shall not apply if it would have the effect, but
only to the extent of such effect, of invalidating any insurance coverage of
Landlord or Tenant.  The foregoing waiver
shall also apply to any deductible, as if the same were a part of the insurance
recovery.  Landlord and Tenant will cause
their respective insurers to issue appropriate waiver of subrogation rights
endorsements, and shall supply each other with appropriate information from
their respective insurers confirming such waiver to be in effect.

10.                                 ASSIGNMENT
OR SUBLETTING.  Without Landlord’s
consent, Tenant shall not (i) assign, convey, or mortgage this Sublease or any
interest under it; (ii) allow any transfer thereof or any lien upon Tenant’s
interest by operation of law; (iii) sub-sublet the Premises or any part
thereof; or (iv) permit the occupancy of the

 2
 

 

Premises or any part thereof by anyone other than
Tenant. Landlord’s consent to an assignment of this Sublease or a
sub-subletting of the Premises shall not be unreasonably withheld, and if Landlord
consents, Landlord shall use reasonable efforts to obtain the consent of Prime
Landlord if its consent is required under the Prime Lease. Any cost of
obtaining Prime Landlord’s consent shall be borne by Tenant.

No permitted assignment
shall be effective and no permitted sub-subletting shall commence unless and
until any default by Tenant hereunder shall have been cured.  Unless otherwise agreed by the Landlord and
Tenant, no permitted assignment or sub-subletting shall relieve Tenant from its
obligations and agreements hereunder and Tenant shall continue to be liable as
a principal and not as a guarantor or surety, to the same extent as though no
assignment or sub-subletting had occurred.

11.                                 REPAIRS
AND COMPLIANCE.

(a)                                  Landlord
represents that the Premises comply with all rules, ordinances, building codes,
and laws applicable to the present use of the Premises.  Landlord shall obey, observe and promptly
comply with all rules, regulations, ordinances, building codes, and laws which
shall be applicable, now or at any time during the Term, to the ownership of
the Premises and shall promptly comply with all orders, rules, rulings and
directives of any governmental authority or agency having jurisdiction over the
Premises, including, without limitation, existing and outstanding orders and
requirements.  Notwithstanding anything
herein to the contrary, Landlord shall, at Landlord’s sole cost and expense, at
all times ensure that the Premises are in compliance with the Americans With
Disabilities Act of 1990 (42 U. S. C. 12 101 et seq.) and all regulations and
guidelines promulgated thereunder, as all of the same may be amended and
supplemented from time to time.

(b)                                 Tenant
shall obey, observe and promptly comply with all rules, regulations, ordinances
and laws which shall be applicable to the operation of its business, now or at
any time during the Term, provided, however, that Tenant shall not be required
to make any capital expenditure to the Premises in order to achieve such
compliance.

(c)                                  Unless
expressly made the obligation of Tenant hereunder, Landlord shall, at its sole
expense, be responsible for all repairs, maintenance, and replacement of the
Premises including, without limitation, the roof, foundation, plumbing,
mechanical components, HVAC components, electrical components and structural
components of the Premises.  When used in
this Sublease, “repair” shall include making all replacements, renewals,
alterations, additions and betterments necessary or desirable to the good
operation of the Premises.   All repairs
made by Landlord shall be at least equal in quality to the original work
performed in constructing the Building and shall be made by Landlord in
accordance with all applicable laws, ordinances and regulations.

(d)                                 Tenant
shall be responsible for the routine maintenance of interior demising walls,
interior doors, locks, and the electrical, plumbing, mechanical, and HVAC
components, provided that any capital expenditure required for the repair and
maintenance of such components shall be the responsibility of Landlord.

12.                                 FIRE
OR CASUALTY OR EMINENT DOMAIN.  In the
event of a fire or other casualty affecting the Property, or of a taking of all
or part of the Property by the exercise of the power of eminent domain,
Landlord shall not exercise any right that may have the effect of terminating
the Prime Lease without first obtaining the prior consent of Tenant.  If Landlord is entitled, under the Prime
Lease, to a rent abatement as a result of a fire or other casualty or as a
result of a taking under the power of eminent domain, then Tenant shall be
entitled its proportionate share of such rent abatement.  If the Prime Lease imposes on Landlord the
obligation to repair or restore leasehold improvements or alterations, Tenant
shall be responsible for repair or restoration of leasehold improvements or
alterations it shall have installed in the Premises, and Landlord shall be
responsible for the repair or restoration of the balance of the leasehold
improvements or alterations.  Tenant
shall make any insurance proceeds resulting from the loss that Landlord is
obligated to repair or restore available to Landlord and shall permit Landlord
to enter the Premises to perform the same.

13.                                 ALTERATIONS.  Anything to the contrary contained herein
notwithstanding, Tenant shall not make or cause to be made any alterations or
additions, including any signage, or perform or cause to be performed any other
repairs or replacements (except as required by Section
7(B)) in or to the Premises (collectively “Alterations”) without
Landlord’s prior written consent, which consent shall not be unreasonably
withheld, and, if

 3
 

 

Prime Landlord’s consent is required under the Prime
Lease, without Prime Landlord’s consent, and Landlord may impose such
conditions on its consent as Landlord requires or Landlord may, at its option,
in the case of maintenance, repairs or replacements, perform or cause to be
performed the same itself and Tenant shall reimburse Landlord for the cost
thereof within ten (10) days after demand therefore by Landlord.

14.                                 SURRENDER.  Upon the expiration of this Sublease, or upon
the termination of this Sublease or of the Tenant’s right to possession of the
Premises, Tenant will at once surrender and deliver up the Premises, together with
all improvements thereon, to Landlord, in good order and broom-clean (ordinary
wear and tear, damage due to casualty and repairs required to be performed by
Landlord under this Sublease excepted). 
Tenant shall be permitted, at Tenant’s option, to leave all Alterations
made by Tenant at the Premises.  All
Alterations to the Premises made by or for Tenant and left by Tenant shall
become a part of and shall remain upon the Premises upon such termination
without compensation, allowance or credit to Tenant.  If Tenant removes Alterations, Tenant shall
restore the Premises to their condition prior to the making of the Alterations,
repairing any damage resulting from the removal or restoration.  If Tenant does not perform removal in
accordance with this Section,
Landlord may, at its option, remove the Alterations (and repair any damage
occasioned thereby) and dispose thereof or deliver the same to any other place
of business of Tenant, or warehouse the same and, to the fullest extent
permitted by law Landlord shall in no event be responsible for the value,
preservation or safekeeping thereof and Tenant shall pay the costs of such
removal, repair, restoration, delivery or warehousing to Landlord on demand.

15.                                 REMOVAL
OF TENANT’S PROPERTY.  Upon the
expiration or earlier termination of this Sublease, Tenant shall remove all of
its contents, including trade fixtures, machinery, equipment, furniture, and
furnishings (“Personalty”). Tenant shall repair any damage to the Premises or
the Property that may result from such removal, and shall restore the Premises
to the same condition as prior to their. 
If Tenant does not remove the Personalty prior to the expiration or
earlier termination of the Term, Landlord may, at its option, remove the same
(and repair any resulting damage) and store, dispose of or deliver the
Personalty to any other place of business of Tenant, or warehouse the same,
and, to the fullest extent permitted by law, Landlord shall in no event be
responsible for the value, preservation or safekeeping thereof and Tenant shall
pay the cost of such removal, repair, restoration, delivery or warehousing to
Landlord on demand.

16.                                 HOLDING
OVER.  Tenant shall have no right to
occupy the Premises or any portion thereof after the expiration of this
Sublease Term or after termination of this Sublease or of Tenant’s right to
possession in consequence of an Event of Default.  If Tenant or any party claiming by, through,
or under Tenant holds over, Landlord may exercise any and all remedies
available to it at law or in equity to recover possession of the Premises, and
to recover damages, including damages payable by Landlord to Prime Landlord by
reason of such holdover.  For each and
every month or partial month that Tenant or any party claiming by, through or
under Tenant remains in occupancy of all or any portion of the Premises after
the expiration of this Sublease or after termination of this Sublease or
Tenant’s right to possession, Tenant shall pay, as minimum damages and not as a
penalty, monthly rental at a rate equal to double the rate of Base Rent and
Additional Rent payable by Tenant hereunder immediately prior to the expiration
or other termination of this Sublease or of Tenant’s right to possession.  The acceptance by Landlord of any lesser sum
shall be construed as payment on account and not in satisfaction of damages for
such holding over.

17.                                 ENCUMBERING
TITLE.  Tenant shall not do anything that
shall encumber the title of Prime Landlord or Landlord in and to the Building
or the Property, nor shall the interest or estate of Prime Landlord or Landlord
be subject to any claim by way of lien or encumbrance caused by Tenant.  Any claim to, or lien upon, the Premises, the
Building or the Property arising from any act or omission of Tenant shall
accrue only against the subleasehold estate of Tenant and shall be subject and
subordinate to the paramount title and rights of Prime Landlord and Landlord in
and to the Premises, Building and the Property. 
Without limiting the generality of the foregoing, Tenant shall not
permit the Premises, the Building or the Property to become subject to any
mechanics,’ laborers’ or materialmen’s lien on account of labor or material
furnished to Tenant or claimed to have been furnished to Tenant in connection
with work of any character performed or claimed to have been performed on the
Premises by, or at the direction or sufferance of Tenant, provided, however,
that if permitted under the Prime Lease, Tenant shall have the right to contest
in good faith if done with reasonable diligence the validity of any lien or claimed
lien if Tenant shall give to Prime Landlord and Landlord such security as may
be deemed satisfactory to them to assure payment and to prevent any sale,
foreclosure, or forfeiture of the Premises, the Building, or the

 4
 

 

Property by reason of non-payment. On final
determination of the lien or claim of lien, Tenant shall immediately pay any
judgment rendered, with all costs and charges, and shall have the lien released
and any judgment satisfied.

18.                                 LANDLORD’S
RESERVED RIGHTS.  Landlord reserves the
following rights, exercisable on reasonable prior notice to Tenant but without
liability to Tenant for damage or injury to property, person or business and
without effecting an eviction or disturbance of Tenant’s use or possession or
giving rise to any claim for setoff or abatement of rent or affecting any of
Tenant’s obligations under this Sublease:

(a)                                  From
time to time, with prior notice to Tenant and during usual business hours, to
inspect the Premises or to exhibit them to persons having a legitimate interest
at any time during this Sublease Term.

(b)                                 To
decorate, remodel, repair, alter or otherwise prepare the Premises for
reoccupancy at any time after Tenant vacates or abandons the Premises.

19.                                 DEFAULTS.  Tenant further agrees that any one or more of
the following events shall be considered Events of Default:

(a)                                  Tenant
is adjudged an involuntary bankrupt, or a decree or order approving, as
properly filed, a petition or answer filed against Tenant asking for
reorganization of Tenant under the Federal bankruptcy laws as now or hereafter
amended, or under the laws of any State, shall be entered, and any such decree
or judgment or order shall not have been vacated or stayed within sixty (60)
days from the date of the entry or granting thereof;

(b)                                 Tenant
files, or admits the jurisdiction of the court and the material allegations
contained in, any petition in bankruptcy, or any petition pursuant or
purporting to be pursuant to the Federal bankruptcy laws as now or hereafter
amended, or Tenant shall institute any proceedings for relief of Tenant under
any bankruptcy or insolvency laws or any laws relating to the relief of
debtors, readjustment of indebtedness, reorganization, arrangements,
composition or extension;

(c)                                  Tenant
makes an assignment for the benefit of creditors or applies for or consents to
the appointment of a receiver for Tenant or any of the property of Tenant;

(d)                                 Tenant
admits in writing its inability to pay its debts as they become due;

(e)                                  A
decree or order appointing a receiver of the property of Tenant is made, and
such decree or order shall not have been vacated, stayed, or set aside within
sixty (60) days from the date of entry or granting thereof;

(f)                                    Tenant
abandons the Premises during the Terms hereof;

(g)                                 Tenant
defaults in any payment of Rent required to be made by Tenant hereunder when
due as herein provided and such default shall continue for five (5) days after
notice thereof in writing to Tenant;

(h)                                 Tenant
shall default in securing insurance or in providing evidence of insurance as
set forth in Section 9 of this
Sublease or shall default with respect to lien claims as set forth in Section 17 of this Sublease and either
such default shall continue for five (5) days after notice thereof in writing
to Tenant;

(i)                                     Tenant
shall, by its act or omission to act, cause a default under the Prime Lease,
and such default, if curable, is not cured within the time, if any, permitted
for such cure under the Prime Lease; or

(j)                                     Tenant
defaults in any of the other agreements contained to be kept, observed, and
performed by Tenant, and such default shall continue for thirty (30) days after
notice thereof in writing to Tenant.

20.                                 REMEDIES.  Upon the occurrence of any one or more events
of default, Landlord may exercise any remedy against Tenant which Prime
Landlord may exercise for default by Landlord under the Prime Lease or
otherwise available herein, at law, in equity or otherwise including, without
limitation, termination of this Sublease. 

 5
 

 

If Tenant is in
default, upon demand, Tenant shall surrender possession and vacate the Premises
immediately and deliver possession thereof to the Landlord, and Landlord may
then or at any time thereafter re-enter and take complete and peaceful
possession of the Premises, with or without process of law, full and complete
license so to do being hereby granted to the Landlord, and Landlord may remove
all occupants and property therefrom, without being deemed in any manner guilty
of trespass, eviction or forcible entry and detainer and without relinquishing
Landlord’s right to Rent or any other right given to Landlord hereunder or by
operation of law.  Tenant shall pay all
of Landlord’s costs, charges and expenses, including court costs and attorneys’
fees, incurred in enforcing Tenant’s obligations under this Sublease or incurred
by Landlord in any litigation, negotiation or transactions in which Tenant
causes the Landlord, without Landlord’s fault, to become involved or
concerned.  In addition to all other
rights and remedies available to Landlord for an default by Tenant, Landlord
may enforce the provisions of this Sublease and may enforce and protect the
rights of Landlord hereunder by a suit or suits in equity or at law for the
specific performance of any covenant or agreement contained herein, Landlord
not being required to prove special damages, it being hereby stipulated that
legal remedies would be inadequate, and for the enforcement of any other
appropriate legal or equitable remedy, including without limitation (i)
injunctive relief, and (ii) any other damages incurred by Landlord by reason of
Tenant’s default under this Sublease.

21.                                 COMMUNICATIONS.  All notices, demands, requests, consents,
approvals, agreements, or other communications (“Communications”) that may or
are required to be given by either party to the other under this Sublease shall
be in writing and shall be deemed given when received or refused if sent by
United States registered or certified mail, postage prepaid, return receipt
requested, or if sent by overnight commercial courier service (a) if to Tenant,
addressed to Tenant at the Premises or at such other place as Tenant may from
time to time designate by notice in writing to Landlord or (b) if to Landlord,
addressed to Landlord at Daniel P. Gorey, c/o Quixote Corporation, 11th Floor, 35 East Wacker Drive, Chicago, Illinois
60601, with a copy to Holland & Knight LLP, 131 South Dearborn Street, 30th Floor, Chicago, Illinois 60603,
Attention:  Anthony L. Frink, or at such
other place as Landlord may from time to time designate by notice to Tenant.  Each party agrees to deliver promptly a copy
of each Communication from the other party to Prime Landlord, and to deliver
promptly to the other party, a copy of any Communications received from Prime
Landlord, that affect this Sublease. 
Such copies shall be delivered by commercial courier for delivery on the
next business day.  Attorneys for
Landlord and Tenant are authorized to give notices for and on behalf of such
parties.

22.                                 PROVISIONS
REGARDING SUBLEASE.  This Sublease and
all the rights of parties hereunder are subject and subordinate to the Prime
Lease.   Each party agrees that it will
not, by its act or omission to act, cause a default under the Prime Lease.  In furtherance of the foregoing, the parties
hereby confirm, each to the other, that it is not practical in this Sublease to
enumerate all of the rights and obligations of the various parties under the
Prime Lease and to specifically allocate those rights and obligations in this
Sublease.  Accordingly, in order to
afford to Tenant the benefits of this Sublease and of those provisions of the
Prime Lease that by their nature are intended to benefit the party in
possession of the Premises, and in order to protect Landlord against a default
by Tenant that might cause a default or event of default by Landlord under the
Prime Lease, the parties agree:

A.                                   Provided
Tenant shall timely pay all Rent when due under this Sublease, Landlord shall
pay, when due, within any applicable cure periods, all rent and other changes
payable by Landlord to Prime Landlord under the Prime Lease.

B.                                     Except
as otherwise expressly provided herein, Landlord shall perform its covenants
and obligations under the Prime Lease that do not require possession of the
Premises for their performance and that are not otherwise to be performed
hereunder by Tenant on behalf of Landlord. 
For example, Landlord shall at all times keep in full force and effect
all insurance required of Landlord as tenant under the Prime Lease unless that
requirement is waived in writing by Prime Landlord.

C.                                     Except
as otherwise expressly provided herein, Tenant shall perform all affirmative
covenants and shall refrain from performing any act that is prohibited by the
negative covenants of the Prime Lease, where the obligation to perform or
refrain from performing is by its nature imposed upon the party in possession
of the Premises.  If practicable, Tenant
shall perform affirmative covenants that are also covenants of Landlord under
the Prime Lease at least five (5) days prior to the date when Landlord’s
performance is required under the Prime Lease. 
Landlord shall have the right to enter the Premises to cure any default
by Tenant under this Sub-Section 25(C).

 6
 

 

D.                                  Landlord
shall not agree to any amendment to the Prime Lease that might have an adverse
effect on Tenant’s occupancy of the Premises or its use of the Premises for
their intended purpose, unless Landlord shall first obtain Tenant’s prior
approval.

E.                                      Landlord
grants to Tenant the right to receive all of the services and benefits with
respect to the Premises that are to be provided by Prime Landlord under the
Prime Lease.  Unless required pursuant to
this Sublease, Landlord shall have no duty to perform any obligations of Prime
Landlord that are, by their nature, the obligation of an owner or manager of real
property.  Landlord shall have no
responsibility for or be liable to Tenant for any default, failure or delay on
the part of Prime Landlord in the performance or observance by Prime Landlord
of any of its obligations under the Prime Lease, nor shall such default,
failure or delay by Prime Landlord affect this Sublease or waive or defer the
performance of any of Tenant’s obligations hereunder except to the extent that
such default by Prime Landlord excuses performance by Landlord as tenant under
the Prime Lease.  Notwithstanding the
foregoing, the parties contemplate that Prime Landlord will perform its
obligations under the Prime Lease and in the event of any default or failure of
such performance by Prime Landlord, Landlord agrees that it will, upon notice
from Tenant, make demand upon Prime Landlord to perform its obligations under
the Prime Lease.

23.                                 ADDITIONAL
SERVICES. Landlord shall cooperate with Tenant to cause Prime Landlord to
provide services required by Tenant in addition to those otherwise required to
be provided by Prime Landlord under the Prime Lease (such as after hours
heating or cooling). Tenant shall pay Prime Landlord’s charge for those
services promptly after having been billed by Prime Landlord or by Landlord. If
at any time a charge for the additional services is attributable to the use of
the services both by Landlord and by Tenant, the cost shall be equitably
divided between them.

24.                                 PRIME
LANDLORD’S CONSENT.  This Sublease and
the obligations of the parties under it are expressly conditioned upon
Landlord’s obtaining Prime Landlord’s consent to this Sublease. Tenant shall
promptly deliver to Landlord any information reasonably requested by Prime
Landlord (in connection with Prime Landlord’s approval of this Sublease) with
respect to the nature and operation of Tenant’s business, the financial
condition of Tenant, or both. Landlord and Tenant agree, for the benefit of
Prime Landlord, that this Sublease and Prime Landlord’s consent hereto shall
not: (a) create privity of contract between Prime Landlord and Tenant; (b) be
deemed to have amended the Prime Lease in any regard (unless Prime Landlord
shall have expressly agreed to the amendment); or (c) be construed as a waiver
of Prime Landlord’s right to consent to any assignment of the Prime Lease by
Landlord or any further subletting of premises leased pursuant to the Prime
Lease, or as a waiver of Prime Landlord’s right to consent to any assignment by
Tenant of this Sublease or any sub-subletting of all or any part of the
Premises. Prime Landlord’s consent shall, however, be deemed to evidence Prime
Landlord’s agreement that Tenant may use the Premises for Tenant’s Use and
Tenant shall be entitled to any waiver of claims and of the right of
subrogation for damage to Prime Landlord’s property if and to the extent that
the Prime Lease provides such waivers for the benefit of Landlord. If Prime
Landlord fails to consent to this Sublease within five (5) days after the
execution and delivery of this Sublease, either party may terminate this Sublease
by giving notice to the other at any time thereafter, but before Prime Landlord
grants consent.

25.                                 BROKERAGE.  Each party warrants to the other that it has
had no dealings with any broker or agent in connection with this Sublease.  Each party agrees to indemnify the other
party from and against any and all costs (including reasonable attorneys’
fees), expense or liability for any compensation, commissions and charges
claimed by any broker or other agent with respect to this Sublease or its negotiation
thereof on behalf of the party through whom the claim is made.

26.                              DEFINITIONS
AND CONSTRUCTION.

A.                                   The
words “including,” “include,” or “includes” or words of similar import shall
not, unless otherwise provided, be construed as words of limitation.

B.                                     The
phrase “not unreasonably withheld” means “not unreasonably withheld, delayed,
or conditioned”.

C.                                     “Indemnify”
includes indemnify, hold harmless, and defend against any loss, liability,
claim, charge, cost, or expense (including reasonable legal fees and expenses).

 7
 

 

27.                              ADDITIONAL PROVISIONS.

A.                                 Time
of the Essence. Time is of the essence of this Sublease and each and every
provision hereof.

B.                                   Non-Waiver.
No action or failure to act by any party hereto shall constitute a waiver of
any right or duty afforded to such party under this Sublease, nor shall any
such action or failure to act constitute an approval of, or acquiescence in,
any breach hereof except as may be specifically agreed in writing. Acceptance
of any amounts due hereunder by Landlord at any time when the Tenant is in
default under any covenant or condition hereof shall not be construed as a
waiver of such default.

C.                                   Entire
Agreement. This Sublease represents the entire agreement of the parties with
respect to the subject matter hereof. This Sublease may not be changed,
modified or rescinded, and no provision hereof may be waived, except by written
consent of the parties, and any attempt at an oral modification of this
Sublease shall be void and have no effect.

D.                                  Captions.
The captions contained herein are for reference purposes only and shall not, in
any way, affect any of the meaning or interpretation of the terms of this
Sublease.

E.                                    Severability.
In the event that any provision of this Sublease, or the application thereof to
any person or circumstance, shall, to any extent, be invalid or unenforceable,
the remainder of this Sublease shall not be affected thereby and each provision
of this Sublease shall be valid and enforceable to the fullest extent permitted
by law, unless either party is substantially deprived of its consideration for
entering into this transaction.

F.                                    Recording.  Neither this Sublease, nor any memorandum,
affidavit or other writing with respect to this Sublease, shall be recorded by
Tenant or by anyone acting through, under or on behalf of Tenant, and the
recording thereof in violation of this provision shall make this Sublease null
and void at Landlord’s election.

G.                                   Counterparts.
This Sublease may be executed in multiple counterparts. All counterparts, collectively,
shall be deemed to constitute one and the same instrument and each counterpart
shall be deemed an original.

H.                                  Facsimile.
A facsimile copy of this Sublease containing facsimile signatures shall
constitute a valid and binding counterpart of this Sublease.

I.                                       Successors
and Assigns. The terms and provisions of this Sublease shall be binding upon
and inure to the benefit of the parties and their respective heirs, directors,
shareholders, officers, legal representatives, successors and assigns but this
provision shall not operate to permit any transfer, assignment, mortgage,
encumbrance, lien, charge, or subletting contrary to the provisions of Section 10.

J.                                      Delivery
for Examination. Submission of this Sublease for examination shall not bind
Landlord in any manner, and no sublease or obligations of the Landlord shall
arise until both Landlord and Tenant sign this instrument and delivery is made
to each.

K.                                  Default
Interest; Late Payments. All amounts (including, without limitation, Base Rent
and Additional Rent) owed by Tenant to Landlord pursuant to any provision of
this Sublease shall bear interest from the date due until paid at the annual
rate equal to the greater of (a) twelve percent (12%) per annum and (b) five
percentage points (5%) in excess of the rate of interest announced from time to
time by Bank of America or any successor thereto, as its corporate base rate,
changing as and when said corporate base rate changes, unless a lesser rate
shall then be the maximum rate permissible by law with respect thereto, in
which event said lesser rate shall be charged. In addition, to the extent not
prohibited by law, if any payment of Rent is not received by Landlord within
five (5) days after the date due, then Tenant shall pay Landlord a late charge
equal to five percent (5%) of the amount of said delinquent payment.

 8
 

 

L.                                    Application
of Payments. Landlord shall have the right to apply payments received from
Tenant pursuant to this Sublease (regardless of Tenant’s designation of such
payments) to satisfy any obligations of Tenant hereunder, in such order and
amounts, as Landlord in its sole discretion, may elect.

M.                               Landlord.
The term “Landlord” as used in this Sublease means only the owner or owners at
the time being of Landlord’s interest in the Prime Lease so that in the event
of any assignment once or successively, of Landlord’s interest in the Prime
Lease, said Landlord making such assignment shall be and hereby is entirely
freed and relieved of all covenants and obligations of Landlord hereunder accruing
after such assignment, and Tenant agrees to look solely to such assignee with
respect thereto. This Sublease shall not be affected by any such assignment,
and Tenant agrees to attorn to the assignee.

N.                                  Tenant-Corporation.
Each party represents and warrants to the other that this Sublease has been
duly authorized, executed and delivered by and on behalf of the each party.

O.                                    Environmental.

(a).                               Landlord
warrants to Tenant that to the best knowledge of Landlord, the Premises, the
Building, and the Property are free and clear of Hazardous Materials, except to
the extent such use of Hazardous Materials is in compliance with all applicable
law.  For the purposes of this Sublease,
“Hazardous Materials” means substances regulated under federal law or by the
laws of the state or municipality in which the Premises are located, and
including but not limited to asbestos, radioactive and petroleum-related
products.  Tenant shall not be
responsible for any Hazardous Materials located on the Premises or the Building
at the time Landlord delivers possession of the Premises to Tenant.

(b)                                 Landlord
agrees to indemnify, defend and hold harmless Tenant, its representatives,
agents and employees (collectively, the “Tenant Indemnitees”) from and against
any and all debts, liens, claims, causes of action, administrative orders or
notices, costs, personal injuries, losses, damages, liabilities, demands,
interest, fines, penalties or expenses, including reasonable attorneys’ fees
and expenses, reasonable consultants’ fees and expenses, court costs and all
other out-of-pocket expenses, suffered or incurred by the Tenant Indemnitees
resulting from actions or omissions at any time prior to, during, or after the
Term related to any handling, releasing, storage, insertion or any other manner
of Hazardous Material in, upon or under the surface of the Premises or the
Property or in any surface waters or ground waters on or under the Property or
any migration off the Property, unless caused by the acts or omissions of
Tenant, its representatives, agents or employees.  Landlord’s obligations under this section
shall survive the expiration or termination of this Sublease.

[signatures on following
page]

 9
 

 

The parties have executed this Sublease the day and
year first above written.

	
  LANDLORD:

  	 

	 
	
   

  
	 
	
  U.S. Traffic
  Corporation f/k/a Green Light Acquisition Company,

  
	 
	
  a Delaware company

  
	 
	
   

  
	
  By:

  	
  /s/ Daniel P. Gorey

  	
   

  	 

	
  Printed Name:

  	
  Daniel P. Gorey

  	
   

  	 

	
  Printed Title:

  	
  Vice President

  	
   

  	 

	
   

  	 

	 
	
  TENANT:

  
	 
	
   

  
	 
	
  National Signal, Inc.

  
	 
	
   

  
	
  By:

  	
  /s/Mark Fernandez

  	
   

  	 

	
  Printed Name:

  	
  Mark Fernandez

  	
   

  	 

	
  Printed Title:

  	
  President

  	
   

  	 

													

 

 10

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