Document:

exv10w1

 

Exhibit 10.1

THIRD AMENDMENT TO LEASE AGREEMENT

     This THIRD AMENDMENT TO LEASE AGREEMENT (“Third Amendment”) is made this April 12, 2006, by
and between VAN DYKE OFFICE LLC, a Michigan limited liability company (the “Landlord”), whose
address is 30078 Schoenherr Road, Suite 300, Warren, Michigan 48088, and ASSET ACCEPTANCE, LLC, a
Delaware limited liability company (the “Tenant”), whose address is 28405 Van Dyke, Warren,
Michigan 48093.

RECITALS:

     This Third Amendment is based on the following recitals:

     A. Landlord and Tenant are parties to that certain Lease Agreement dated October 31, 2003, as
amended by First Amendment to Lease Agreement (“First Amendment”) dated June 25, 2004, and by
Second Amendment to Lease Agreement (“Second Amendment”) dated October 1, 2004 (as amended, the
“Lease”).

     B. Landlord desires to sell the Leased Premises and assign its interest in the Lease.

     C. Landlord and Tenant wish to modify certain provisions of the Lease, which modifications
shall only take effect upon Landlord’s sale of the Leased Premises, all as more fully set forth
herein.

     NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth herein, the
parties agree as follows:

     1. The defined terms in the Lease shall have the same meanings in this Third Amendment.

     2. A condition precedent to the effectiveness of this Third Amendment is the sale of the
Leased Premises by Landlord to a third party purchaser (or to Tenant if Tenant exercises its right
of first refusal) on or before December 31, 2006 (in such timely manner, “Landlord’s Intended
Sale”). In the event that Landlord fails to effectuate any such sale and assignment within such
time frame, this Third Amendment shall immediately be deemed to be null and void effective as of
March 31, 2006. Upon the closing of Landlord’s Intended Sale, this Third Amendment shall take
effect and shall fully replace the First Amendment and Second Amendment by merger into this Third
Amendment, which shall thereafter be deemed to be null and void.

     3. Intentionally deleted.

     4. Tenant hereby agrees to construct the build out of the Vanilla Box Square Footage pursuant
to plans and specifications which show improvements better than or equal to the improvements shown
in the plans and specifications used by Landlord for Landlord’s Work with respect to the Built Out
Square Footage. At closing of Landlord’s Intended Sale, Landlord shall deposit $1,250,000 in
escrow with the Philip F. Greco Title Company (“Title Company”), which funds shall be deposited by
the Title Company in an interest bearing account. The Title Company shall deliver all such
escrowed funds (including interest) to Tenant, in full satisfaction of the Vanilla Box Allowance,
within ten (10) days after the last to occur of the following: (a) Landlord’s receipt of evidence
that Tenant has procured a temporary certificate of occupancy for such Vanilla Box Square Footage;
and (b) Landlord’s receipt of reasonable evidence (including

 

 

lien waivers and sworn statements) to prove that the build out was completed in accordance with the
minimum standards set forth herein and in a workmanlike and lien-free manner. In the event that
Tenant has failed to comply with subsections (a) and (b) above on or prior to May 31, 2016, then
the Title Company shall return all such escrowed funds (including interest) to Landlord,
and Tenant shall thereafter have no obligation to build out the Vanilla Box Square Footage nor any
right to receive any of the Vanilla Box Allowance. The Vanilla Box Allowance shall be held by the
Title Company in an interest bearing account in accordance with the terms and condition of this
Section 4 and any additional escrow instructions which may be agreed upon by Landlord and Tenant.

     5. The first sentence of Section 1.02 of the Lease is amended to read in its entirety as
follows:

     “The term of this Lease shall be for a period of eleven and one-half (11.5) years plus any
option period as provided below (the “Term”) commencing on December 1, 2004 (the
“Commencement Date”), and expiring on May 31, 2016.”

     6. The second paragraph of Section 2.01 of the Lease is amended to read in its entirety as
follows:

     “Notwithstanding the Rent Schedule, upon the closing of Landlord’s Intended Sale and
thereafter for the remainder of the Term of the Lease and any Option Period exercised,
Tenant shall pay the same rent for the Vanilla Box Square Footage as Tenant is required to
pay for the Built Out Square Footage per the Rent Schedule.”

     7. The Rent Exhibit attached as Exhibit E to the Lease is hereby amended, restated and
replaced with the Rent Exhibit attached hereto as Exhibit E (“Revised Rent Exhibit”).

     8. Section 22.05 of the Lease is amended to provide that Tenant’s address for notice purposes
is:

Asset Acceptance LLC

28405 Van Dyke

Warren, MI 48093

Attn: Thomas Good, General Counsel.

     9. Landlord agrees to pay all attorney fees of Tenant in negotiating and finalizing this Third
Amendment (and the Declaration defined in Section 15 below). Such reimbursement by Landlord will
occur upon the execution of this Third Amendment by Tenant.

     10. Subject to the terms of Section 15 below and the Declaration (as defined therein), the
Site Plan attached as Exhibit B to the Lease is hereby amended, restated and replaced with the Site
Plan attached hereto as Exhibit B (“Revised Site Plan”).

     11. Subject to the terms of Section 15 below and the Declaration (as defined therein), Section
22.12 of the Lease is hereby amended to provide that Landlord agrees to provide to Tenant a minimum
of 1,300 parking spaces at all times during the term to be located in material accordance with the
Revised Site Plan.

     12. Landlord shall construct the new paved parking areas (see shaded areas) and landscaped
areas to the north and west of the parking deck shown on the attached Revised Site

 

 

Plan. In addition, with respect to the narrow strip of temporary parking that currently
exists and is located north of the existing parking structure (such area is also north of the
shaded area on such Revised Site Plan), Landlord agrees to add a second coat of asphalt to such
area and to replace the temporary lighting with permanent lighting to match the remainder of the
finished parking lot. In the event that such improvements are not completed by Landlord prior to
the closing of Landlord’s Intended Sale, Landlord shall deposit in escrow with the Philip F. Greco
Title Company at such closing an amount equal to 125% of the estimated cost to complete such
improvements at such time, and such money shall be held in accordance with mutually agreeable
escrow provisions to ensure the completion of such improvements by Landlord in a workmanlike and
lien free manner within six (6) months after the closing of Landlord’s Intended Sale. Landlord
shall procure a minimum of two (2) bids from third party contractors to complete such improvements,
and the average of such bids shall equal the “estimated cost” of same for the purpose of
calculating the amount of money to be escrowed. Such escrow provisions shall provide that, in the
event Landlord does not complete such improvements within the aforementioned time period, then
Tenant may draw upon such escrowed funds in order to complete the same, and any amount not drawn by
Tenant shall be returned to Landlord. For the purposes of this Section 12: (a) “completion” of
the landscaped areas shall mean substantial completion of such areas in accordance with the Revised
Site Plan to the reasonable satisfaction of Tenant; and (b) “completion” of paved parking areas
shall mean completion of the second coat (i.e., the “final wearing” course) of asphalt, together
with permanent lighting, all in a first-class manner and all of which shall substantially match the
currently existing exterior areas of the Leased Premises located east of the Building.

     13. Intentionally deleted.

     14. Upon closing of Landlord’s Intended Sale, in addition to the all of the monies to be
deposited by Landlord in escrow with the Title Company in accordance with Sections 4, and 12 of
this Third Amendment, Landlord shall pay to Tenant $1,190,000 in consideration for Tenant executing
this Third Amendment.

     15. Provided that Tenant is operating and not in default under the Lease beyond expiration of
notice and cure periods, then Tenant shall have the option (the “Option”) at any time during the
Term to purchase for One ($1.00) Dollar all or a portion of the cross-hatched area (“Option Area”)
shown on Exhibit G attached hereto, for the purpose of constructing and occupying a new building,
subject to the terms and conditions set forth in the remainder of this Section 15 and in the
Declaration for Creation and Maintenance of Easements and Restrictive Covenants attached hereto as
Exhibit H and made a part hereof. If Tenant desires to exercise the Option contained herein,
Tenant shall give Landlord written notice of its intent to purchase the Option Area on or before
November 30, 2015, and the closing shall occur, if at all, on or before the date which is six (6)
months after Landlord receives such written notice. In such event, Tenant may examine the state of
title to the Option Area to the extent it deems necessary. Landlord shall be obligated to
discharge at the Closing any lien or encumbrance burdening the Option Area which may be discharged
by the payment of a fixed sum of money disclosed in a recorded document. If such examination shall
contain any encumbrances or exceptions which are unacceptable to Tenant, Tenant may rescind the
exercise of the Option. Tenant shall pay for any title policy that it desires. Real estate taxes
and assessments shall be prorated between the parties as of the Closing Date on a due date basis.
To the extent that the Option Area is part of a larger tax parcel at the time of closing, real
estate taxes and assessments shall be apportioned on the basis of relative acreage. Landlord shall
take the position with the State of Michigan that no transfer taxes shall result from the
conveyance of the Option Area to Tenant. In the event that any transfer taxes are nevertheless
imposed in

 

 

connection therewith, Tenant shall be responsible for paying all such transfer taxes, and such
responsibility shall survive the closing. Conveyance shall be “as-is”, by quitclaim deed, with no
representations or warranties of any kind.

     16. Section 2.03 of the Lease is hereby deleted in its entirety.

     17. Section 2.04 of the Lease is hereby amended to provide that the common areas shall be
under the exclusive control and management of Tenant and that Tenant shall be fully responsible to
operate, manage, equip, light, insure, repair and maintain the common areas in accordance with
first class standards. Landlord hereby assigns to Tenant and Tenant hereby assumes from Landlord
and Tenant hereby agrees to perform of all Landlord’s repair, replacement, management and
operational obligations (collectively, the “Assumed Obligations”) under the Lease, including, but
not limited to those obligations contained in Articles II and VII of the Lease, except only with
respect to (a) the electrical transformer, (b) roof, (c) outer walls, (d) foundation of the
building, and (e) the items listed on Exhibit F attached to the Lease (except for Item #20 on
Exhibit F, which is hereby deleted in its entirety), all of which shall remain the sole
responsibility of Landlord without reimbursement by Tenant. Accordingly, Tenant shall manage the
Building and shall not pay any management fee to Landlord. By taking over management of the
Building, Tenant shall be deemed to have released Landlord from any and all claims, loss, costs,
damage and liability suffered or incurred by Tenant arising out of or from any of the Assumed
Obligations existing prior to the closing of Landlord’s Intended Sale.

     18. Landlord Guarantor hereby joins in this Third Amendment to acknowledge and agree that the
terms of this Third Amendment are also guaranteed in full under the Landlord Guaranty and that this
Third Amendment does not amend, modify or alter the Landlord Guarantor’s obligation under the
Landlord Guaranty. If Tenant shall make a demand under the Landlord Guaranty, the Landlord
Guarantor shall be responsible for all of Landlord’s obligations under this Third Amendment and the
Lease.

     19. Asset Acceptance Holdings LLC (“Tenant Guarantor”) hereby joins in this Third Amendment to
acknowledge and agree that the terms of this Third Amendment are also guaranteed in full under that
certain Guaranty dated October 31, 2003 (“Tenant Guaranty”), and that this Third Amendment does not
amend, modify or alter the Tenant Guarantor’s obligation under the Tenant Guaranty. If Landlord
shall make a demand under the Tenant Guaranty, the Tenant Guarantor shall be responsible for all of
Tenant’s obligations under this Third Amendment and the Lease.

     20. Except as amended hereby, the Lease, Landlord’s Guaranty, and Tenant’s Guaranty are
restated and republished in their entirety and remain in full force and effect. To the extent that
there are any conflicts or inconsistencies between the provisions contained in this Third Amendment
and the provisions contained in the Lease, the provisions of this Third Amendment shall be deemed
to be superseding and controlling.

 

 

     IN WITNESS WHEREOF, the parties have executed this Third Amendment the date and year first above
written.

	 	 	 	 	 
	 	Landlord:

VAN DYKE OFFICE LLC,

a Michigan limited liability company

 	 
	 	By:  	/s/ Lorenzo J. Cavaliere
 	 
	 	 	Lorenzo J. Cavaliere 	 
	 	Its:	Manager 	 
	 
	 	Tenant:

ASSET ACCEPTANCE, LLC,

a Delaware limited liability company

 	 
	 	By:  	/s/ Nathaniel F. Bradley IV
 	 
	 	 	Nathaniel F. Bradley IV 	 
	 	Its:	Manager 	 
	 
	 	Landlord Guarantor:

LORENZO JOHN CAVALIERE, LLC,

a Michigan limited liability company

 	 
	 	By:  	/s/ Lorenzo J. Cavaliere
 	 
	 	 	Lorenzo J. Cavaliere 	 
	 	Its:	Manager 	 
	 
	 	Tenant Guarantor:

ASSET ACCEPTANCE HOLDINGS, LLC,

a Delaware limited liability company

 	 
	 	By:  	/s/ Nathaniel F. Bradley IV
 	 
	 	 	Nathaniel F. Bradley IV 	 
	 	Its:	Manager 	 
	 

List of Exhibits

	 	 	 
	Exhibit B

	 	Revised Site Plan
	 
	Exhibit E

	 	Revised Rent Exhibit
	 
	Exhibit G

	 	Option Area and Access Easement Area
	 
	Exhibit H

	 	Declaration for Creation and Maintenance of Easements and Restrictive Covenants<PAGE>

                                                                   EXHIBIT 10.57

                           CARDIAC SCIENCE CORPORATION
                            STOCK OPTION GRANT NOTICE
                      1997 STOCK OPTION/STOCK ISSUANCE PLAN

Cardiac Science Corporation (the "Company") hereby grants to Participant an
Option (the "Option") to purchase shares of the Company's Common Stock. The
Option is subject to all the terms and conditions set forth in this Stock Option
Grant Notice (this "Grant Notice"), in the Stock Option Agreement, the Plan
Summary and the Company's 1997 Stock Option/Stock Issuance Plan (the "Plan"),
which are either provided with this grant notice or are available from the
Company's Vice President -- Finance & Administration and are incorporated into
this Grant Notice in their entirety.

PARTICIPANT:

GRANT DATE:                         ________________________

VESTING COMMENCEMENT DATE:          ________

NUMBER OF SHARES SUBJECT TO OPTION: ________

EXERCISE PRICE (PER SHARE):         ________

OPTION EXPIRATION DATE:             ___ (subject to earlier termination in
                                         accordance with the terms of the Plan
                                         and the Stock Option Agreement)

TYPE OF OPTION:

VESTING AND EXERCISABILITY SCHEDULE:

ADDITIONAL TERMS/ACKNOWLEDGEMENT: By accepting this notice, Participant
acknowledges receipt of, and understands and agrees to, this Grant Notice, the
Stock Option Agreement, the Plan Summary and the Plan. The Stock Option
Agreement, the Plan Summary, and the Plan are either provided with this notice
or available upon request. Participant further agrees that as of the Grant Date,
this Grant Notice, the Stock Option Agreement, the Plan Summary and the Plan set
forth the entire understanding between Participant and the Company regarding the
Option and supersede all prior oral and written agreements on the subject.

Cardiac Science Corporation

By: John R. Hinson
Its: President and CEO

ATTACHMENTS:
1.  Stock Option Agreement
2.  1997 Stock Option/Stock Issuance Plan
3.  Plan Summary

<PAGE>

                           CARDIAC SCIENCE CORPORATION
                      1997 STOCK OPTION/STOCK ISSUANCE PLAN
                             STOCK OPTION AGREEMENT

      Pursuant to your Stock Option Grant Notice (the "Grant Notice") and this
Stock Option Agreement, Cardiac Science Corporation has granted you an Option
under its 1997 Stock Option/Stock Issuance Plan (the "Plan") to purchase the
number of shares of the Company's Common Stock indicated in your Grant Notice
(the "Shares") at the exercise price indicated in your Grant Notice. Capitalized
terms not explicitly defined in this Stock Option Agreement but defined in the
Plan shall have the same definitions as in the Plan.

      The details of the Option are as follows:

1. VESTING AND EXERCISABILITY. Subject to the limitations contained herein, the
Option will vest and become exercisable as provided in your Grant Notice,
provided that vesting will cease upon the termination of your employment or
service relationship with the Company or a Related Company and the unvested
portion of the Option will terminate.

2. SECURITIES LAW COMPLIANCE. Notwithstanding any other provision of this
Agreement, you may not exercise the Option unless the Shares issuable upon
exercise are registered under the Securities Act or, if such Shares are not then
so registered, the Company has determined that such exercise and issuance would
be exempt from the registration requirements of the Securities Act. The exercise
of the Option must also comply with other applicable laws and regulations
governing the Option, and you may not exercise the Option if the Company
determines that such exercise would not be in material compliance with such laws
and regulations.

3. METHOD OF EXERCISE. You may exercise the Option by giving written notice to
the Company, in form and substance satisfactory to the Company, which will state
your election to exercise the Option and the number of Shares for which you are
exercising the Option. The written notice must be accompanied by full payment of
the exercise price for the number of Shares you are purchasing. At the
discretion of the Plan Administrator, you may make this payment in any
combination of the following: (a) by cash; (b) by check acceptable to the
Company; (c) by using shares of Common Stock you have owned for at least six
months; (d) if the Common Stock is registered under the Exchange Act, by
instructing a broker to deliver to the Company the total payment required; or
(e) by any other method permitted by the Plan Administrator.

4. TREATMENT UPON TERMINATION OF EMPLOYMENT OR SERVICE RELATIONSHIP. The
unvested portion of the Option will terminate automatically and without further
notice immediately upon termination of your employment or service relationship
with the Company or a Related Company for any reason ("Termination of Service").
You may exercise the vested portion of the Option as follows:

(a) General Rule. You must exercise the vested portion of the Option on or
before the earlier of (i) three months after your Termination of Service and
(ii) the Option Expiration Date;

(b) Disability. If your employment or service relationship terminates due to
Disability, you must exercise the vested portion of the Option on or before the
earlier of (i) one year after your Termination of Service and (ii) the Option
Expiration Date.

<PAGE>

(c) Death. If your employment or service relationship terminates due to your
death, the vested portion of the Option must be exercised on or before the
earlier of (i) one year after your Termination of Service and (ii) the Option
Expiration Date. If you die after your Termination of Service but while the
Option is still exercisable, the vested portion of the Option may be exercised
until the earlier of (x) one year after the date of death and (y) the Option
Expiration Date; and

(d) Misconduct. The vested portion of the Option will automatically expire at
the time of your Termination of Service for Misconduct, unless the Plan
Administrator determines otherwise.

IT IS YOUR RESPONSIBILITY TO BE AWARE OF THE DATE THE OPTION TERMINATES.

5. LIMITED TRANSFERABILITY. During your lifetime only you can exercise the
Option. The Option is not transferable except by will or by the applicable laws
of descent and distribution, except that Nonqualified Stock Options may be
transferred to the extent permitted by the Plan Administrator. The Plan provides
for exercise of the Option by a beneficiary designated on a Company-approved
form or the personal representative of your estate.

6. WITHHOLDING TAXES. As a condition to the exercise of any portion of an
Option, you must make such arrangements as the Company may require for the
satisfaction of any federal, state, local or foreign withholding tax obligations
that may arise in connection with such exercise.

7. OPTION NOT AN EMPLOYMENT OR SERVICE CONTRACT. Nothing in the Plan or any
Award granted under the Plan will be deemed to constitute an employment contract
or confer or be deemed to confer any right for you to continue in the employ of,
or to continue any other relationship with, the Company or any Related Company
or limit in any way the right of the Company or any Related Company to terminate
your employment or other relationship at any time, with or without Cause.

8. NO RIGHT TO DAMAGES. You will have no right to bring a claim or to receive
damages if you are required to exercise the vested portion of the Option within
three months (one year in the case of Disability or death) of the Termination of
Service or if any portion of the Option is cancelled or expires unexercised. The
loss of existing or potential profit in Awards will not constitute an element of
damages in the event of your Termination of Service for any reason even if the
termination is in violation of an obligation of the Company or a Related Company
to you.

9. BINDING EFFECT. This Agreement will inure to the benefit of the successors
and assigns of the Company and be binding upon you and your heirs, executors,
administrators, successors and assigns.

[INCLUDE SECTIONS 10 AND 11 FOR NON-U.S. RESIDENT OPTION GRANTS ONLY: 10.
LIMITATION ON RIGHTS; NO RIGHT TO FUTURE GRANTS; EXTRAORDINARY ITEM OF
COMPENSATION. By entering into this Agreement and accepting the grant of the
Option evidenced hereby, you acknowledge: (a) that the Plan is discretionary in
nature and may be suspended or terminated by the Company at any time; (b) that
the grant of the Option is a one-time benefit which does not create any
contractual or other right to receive future grants of options, or benefits in
lieu of options; (c) that

<PAGE>

all determinations with respect to any such future grants, including, but not
limited to, the times when options will be granted, the number of shares subject
to each option, the option price, and the time or times when each option will be
exercisable, will be at the sole discretion of the Company; (d) that your
participation in the Plan is voluntary; (e) that the value of the Option is an
extraordinary item of compensation which is outside the scope of your employment
contract, if any; (f) that the Option is not part of normal or expected
compensation for purposes of calculating any severance, resignation, redundancy,
end of service payments, bonuses, long-service awards, pension or retirement
benefits or similar payments; (g) that the vesting of the Option ceases upon
your Termination of Service for any reason except as may otherwise be explicitly
provided in the Plan or this Agreement or otherwise permitted by the Plan
Administrator; (h) that the future value of the Shares underlying the Option is
unknown and cannot be predicted with certainty; and (i) that if the Shares
underlying the Option do not increase in value, the Option will have no value.

11. EMPLOYEE DATA PRIVACY. By entering this Agreement, you (a) authorize the
Company and your employer, if different, and any agent of the Company
administering the Plan or providing Plan recordkeeping services, to disclose to
the Company or any of its affiliates any information and data the Company
requests in order to facilitate the grant of the Option and the administration
of the Plan; (b) waive any data privacy rights you may have with respect to such
information; and (c) authorize the Company and its agents to store and transmit
such information in electronic form.]

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