Document:

Exhibit 10.6

 

LEASE AGREEMENT

 

THIS
LEASE is executed this 5th day of October, 2005, by and between DUGAN REALTY,
L.L.C., an Indiana limited liability company (“Landlord”), and GAIAM, INC., a
Colorado corporation (“Tenant”).

 

WITNESSETH:

 

ARTICLE 1 - LEASE OF PREMISES

 

Section 1.01.  Basic Lease Provisions and Definitions.

 

A.            Leased
Premises (shown outlined on Exhibit A
attached hereto):  5455 West Chester
Road, West Chester, Ohio 45069; Building No. 7 (the “Building”); located
in World Park at Union Centre (the “Park”);

 

B.            Rentable
Area:  Approximately 147,000 square feet;

 

C.            Tenant’s
Proportionate Share:  53.85;

 

D.            Minimum
Annual Rent:

 

	
  October 1,
  2005 - September 30, 2006

  	
   

  	
  $

  	
  463,050.00

  	
   

  
	
  October 1, 2006 - September 30, 2007

  	
   

  	
  $

  	
  474,810.00

  	
   

  
	
  October 1, 2007 - September 30, 2008

  	
   

  	
  $

  	
  486,570.00;

  	
   

  

 

E.             Monthly
Rental Installments:

 

	
  October 1,
  2005 - September 30, 2006

  	
   

  	
  $

  	
  38,587.50 per month

  	
   

  
	
  October 1, 2006 - September 30, 2007

  	
   

  	
  $

  	
  39,567.50 per month

  	
   

  
	
  October 1, 2007 - September 30, 2008

  	
   

  	
  $

  	
  40,547.50 per month;

  	
   

  

 

F.             [Intentionally Omitted];

 

G.            Lease
Term:  Three (3) years;

 

H.            Commencement
Date:  October 1, 2005;

 

I.              Security
Deposit:  None;

 

J.             Guarantor(s):  None;

 

K.            Brokers:
Duke Realty Services Limited Partnership representing Landlord and Colliers
Turley Martin Tucker representing Tenant;

 

L.             Permitted
Use:  General office, warehousing and
distribution of miscellaneous consumer goods and related purposes;

 

M.           Address
for notices:

 

	
  Landlord:

  	
  Dugan Realty,
  L.L.C.

  
	
   

  	
  c/o Duke Realty
  Services Limited Partnership

  
	
   

  	
  Attn: Property
  Manager

  
	
   

  	
  4555 Lake Forest
  Drive, Suite 400

  
	
   

  	
  Cincinnati, OH
  45242

  
	
   

  	
   

  
	
  With a Copy to:

  	
  Dugan Realty,
  L.L.C.

  
	
   

  	
  c/o Duke Realty
  Services Limited Partnership

  
	
   

  	
  Attn.: Jeff Behm

  
	
   

  	
  600 East 96th
  Street, Suite 100

  
	
   

  	
  Indianapolis, IN
  46240

  

 

 

	
  With Payments
  to:

  	
  Dugan Realty,
  L.L.C.

  
	
   

  	
  c/o Duke Realty
  Services Limited Partnership

  
	
   

  	
  75 Remittance
  Drive, Suite 1106

  
	
   

  	
  Chicago, IL
  60675-1106

  
	
   

  	
   

  
	
  Tenant:

  	
  Gaiam, Inc.

  
	
   

  	
  Attn: Mark
  Lipien

  
	
   

  	
  360 Interlochen
  Boulevard, Suite 300

  
	
   

  	
  Broomfield, CO
  80021

  
	
   

  	
   

  
	
  With a Copy to:

  	
  Gaiam, Inc.

  
	
   

  	
  5455 West
  Chester Road

  
	
   

  	
  West Chester, OH
  45069.

  

 

Section 1.02.  Leased Premises.  Landlord hereby leases to Tenant and Tenant
leases from Landlord,  under the terms
and conditions herein, the Leased Premises.

 

ARTICLE 2 - TERM AND POSSESSION

 

Section 2.01.  Term. 
The Commencement Date and Lease Term shall be as set forth in Sections
1.01(g) and 1.01(h) above.

 

Section 2.02.  Construction of Tenant Improvements.  Landlord shall construct and install all
leasehold improvements to the Leased Premises (collectively, the “Tenant
Improvements”) in accordance with Exhibit B
attached hereto and made a part hereof. 
Landlord hereby warrants for a period of one (1) year from the
Commencement Date, the Leased Premises against defects in materials and
workmanship, routine maintenance and ordinary wear and tear excepted.  Upon the Commencement Date, Landlord shall
enforce for the benefit of Tenant all other warranties relating to the Leased
Premises and any and all systems contained therein for the applicable period of
each warranty.  Tenant shall not take any
action which shall invalidate any of the foregoing warranties and shall provide
Landlord with written notice of all warranty claims.

 

Section 2.03.  Surrender of the Premises.  Upon the expiration or earlier termination of
this Lease, Tenant shall immediately surrender the Leased Premises to Landlord
in broom-clean condition and in good condition and repair, normal wear and tear
excepted.  Tenant shall also remove its
personal property, trade fixtures and any of Tenant’s alterations designated by
Landlord, promptly repair any damage caused by such removal, and restore the
Leased Premises to the condition existing prior to the installation of such
items.  If Tenant fails to do so,
Landlord may restore the Leased Premises to such condition at Tenant’s expense,
Landlord may cause all of said property to be removed at Tenant’s expense, and
Tenant hereby agrees to pay all the costs and expenses thereby reasonably
incurred.  All Tenant property which is
not removed within ten (10) days following Landlord’s written demand
therefor shall be conclusively deemed to have been abandoned by Tenant, and
Landlord shall be entitled to dispose of such property at Tenant’s cost without
thereby incurring any liability to Tenant. 
The provisions of this section shall survive the expiration or
other termination of this Lease.

 

Section 2.04.  Holding Over.  If Tenant retains possession of the Leased
Premises after the expiration or earlier termination of this Lease, Tenant
shall become a tenant from month to month at 150% of the Monthly Rental
Installment in effect at the end of the Lease Term, and otherwise upon the
terms, covenants and conditions herein specified, so far as applicable.  Acceptance by Landlord of rent in such event
shall not result in a renewal of this Lease, and Tenant shall vacate and
surrender the Leased Premises to Landlord upon Tenant being given thirty (30)
days’ prior written notice from Landlord to vacate.  This Section 2.04 shall in no way
constitute a consent by Landlord to any holding over by Tenant upon the
expiration or earlier termination of this Lease, nor limit Landlord’s remedies
in such event.

 

ARTICLE 3 - RENT

 

Section 3.01.  Base Rent.  Tenant shall pay to Landlord the Minimum
Annual Rent in the Monthly Rental Installments, in advance, without deduction
or offset, beginning on the Commencement Date and on or before the first day of
each and every calendar month thereafter during the Lease Term.  The Monthly Rental Installment for partial
calendar months shall be prorated. 
Notwithstanding anything contained in this Lease to the contrary, Tenant
shall receive a per diem credit on the Monthly Rental Installment for November 2005
of one day’s Minimum Annual Rent for each day beyond the Commencement Date in
which the installation 

 

 

of the lights and fire safety equipment within the warehouse portion of
the Leased Premises is not achieved.

 

Section 3.02.  Additional Rent.  In addition to the Minimum Annual Rent Tenant
shall pay to Landlord for each calendar year during the Lease Term, as “Additional
Rent,” Tenant’s Proportionate Share of all costs and expenses incurred by
Landlord during the Lease Term for Real Estate Taxes and Operating Expenses for
the Building and common areas (collectively “Common Area Charges”).

 

“Operating
Expenses” shall mean all of Landlord’s expenses for operation, repair,
replacement and maintenance to keep the Building and common areas in good
order, condition and repair (including all additional direct costs and expenses
of operation and maintenance of the Building which Landlord reasonably
determines it would have paid or incurred during such year if the Building had
been fully occupied), including, but not limited to, management fees not to exceed
three percent (3%) of gross rent for the Building; utilities; stormwater
discharge fees; license, permit, inspection and other fees; fees and
assessments imposed by any covenants or owners’ association; security services;
insurance premiums and deductibles, painting, and maintenance, repair and
replacement of the driveways, parking areas (including snow removal), exterior
lighting, landscaped areas, walkways, curbs, drainage strips, sewer lines,
exterior walls, foundation, structural frame, roof and gutters.  The cost of any capital improvement shall be
amortized over the useful life of such improvement in accordance with generally
accepted accounting principles, and only the amortized portion shall be
included in Operating Expenses. 
Operating Expenses shall not include the following:

 

a.         Leasing
commissions.

 

b.         The cost of
tenant finish improvements provided solely for the benefit of other tenants or
proposed tenants in the Building.

 

c.         Costs of
correcting building code violations which violations were in existence on the
Commencement Date and not caused by Tenant.

 

d.         Depreciation
on the Building.

 

e.         The cost of
services separately charged to and paid by another tenant in the Building.

 

f.          Interest
payments and financing costs associated with Building financing.

 

g.         Legal fees
associated with the preparation, interpretation and/or enforcement of leases.

 

h.         Repairs and
replacements for which and to the extent that Landlord has been reimbursed by
insurance and/or paid pursuant to warranties.

 

i.          Advertising
and promotional expenses.

 

j.          Costs
representing amounts paid to an affiliate of Landlord for services or materials
which are in excess of the amounts which would have been paid in the absence of
such relationship.

 

“Real
Estate Taxes” shall include any form of real estate tax or assessment or
service payments in lieu thereof, and any license fee, commercial rental tax,
improvement bond or other similar charge or tax (other than inheritance,
personal income or estate taxes) imposed upon the Building or  common areas (or against Landlord’s business
of leasing the Building) by any authority having the power to so charge or tax,
together with costs and expenses of contesting the validity or amount of Real
Estate Taxes.

 

Section 3.03.  Payment of Additional Rent.  Landlord shall estimate the total amount of
Additional Rent to be paid by Tenant during each calendar year of the Lease
Term, pro-rated for any partial years. 
Commencing on the Commencement Date, Tenant shall pay to Landlord each
month, at the same time the Monthly Rental Installment is due, an amount equal
to one-twelfth (1/12) of the estimated Additional Rent for such year.  Within a reasonable time after the end of
each calendar year, Landlord shall submit to Tenant a statement of the actual amount
of such Additional Rent and within thirty (30) days after receipt of
such statement, Tenant shall pay any deficiency between the actual amount owed
and the estimates paid during such 

 

 

calendar year.  In the event of
overpayment, Landlord shall credit the amount of such overpayment toward the
next installments of Minimum Rent.

 

Section 3.04.  Late Charges.  Tenant acknowledges that Landlord shall incur
certain additional unanticipated administrative and legal costs and expenses if
Tenant fails to timely pay any payment required hereunder.  Therefore, in addition to the other remedies
available to Landlord hereunder, if any payment required to be paid by Tenant
to Landlord hereunder shall become overdue, such unpaid amount shall bear
interest from the due date thereof to the date of payment at the prime rate (as
reported in the Wall Street Journal) of interest (“Prime Rate”) plus
six  percent (6%) per annum.

 

Landlord
shall provide Tenant with a written notice of such payment default prior to
assessing the late charge and Tenant shall have an additional five (5) days
to cure such payment default before Landlord assesses any late charges;
provided, however, that Landlord shall not be required to give such notice more
than one (1) time with respect to any particular payment default, nor more
than two (2) times in the consecutive twelve (12) month period with
respect to any payment defaults in the aggregate.

 

Section 3.05.  Nature of Rent.  Landlord and Tenant agree that any base rent,
percentage rent, if any, and all Additional Rent paid to Landlord under this
Lease (collectively referred to in this Section as “Rent”) shall qualify
as “rents from real property” within the meaning of Section 512(b)(3) of
the Internal Revenue Code of 1986, as amended (the “Code”) and the U.S.
Department of Treasury Regulations promulgated thereunder (the “Regulations”).  In the event that Landlord, in its sole
discretion, determines that there is any risk that all or part of any Rent
shall not qualify as “rents from real property” for the purposes of Section 512(b)(3) of
the Code and the Regulations promulgated thereunder, Tenant agrees (i) to
cooperate with Landlord to restructure this Lease so as to cause all Rent to
qualify as “rents from real property”, and (ii) to permit an assignment of
this Lease, provided, however, that any adjustments required pursuant to this
paragraph shall be made so as to produce the equivalent Rent (in economic
terms) payable prior to such adjustment.

 

Section 3.06. 
Maximum Increase in Operating Expenses. 
Notwithstanding anything in this Lease to the contrary, Tenant will be
responsible for Tenant’s Proportionate Share of Real Estate Taxes, including
the reasonable costs and expenses of contesting the validity or amount of Real
Estate Taxes, service payments in lieu of Real Estate Taxes, insurance
premiums, utilities, snow removal and grass cutting (“Uncontrollable Expenses”),
without regard to the level of increase in any or all of the above in any year
or other period of time.  Tenant’s
obligation to pay all other Building Operating Expenses which are not
Uncontrollable Expenses (herein “Controllable Expenses”) shall be limited to a
five percent (5%) per annum increase over the amount the Controllable Expenses
for the immediately preceding calendar year would have been had the
Controllable Expenses increased by five percent (5%) in all previous calendar
years beginning with the actual Controllable Expenses for the year ending December 31,
2006.

 

ARTICLE 4 - SECURITY DEPOSIT

 

[Intentionally Omitted].

 

ARTICLE 5 - USE

 

Section 5.01.  Use of Leased Premises.  The Leased Premises are to be used by Tenant
solely for the Permitted Use and for no other purposes without the prior
written consent of Landlord.

 

Section 5.02.  Covenants of Tenant Regarding Use.  Tenant shall (i) use and maintain the
Leased Premises and conduct its business thereon in a safe, careful, reputable
and lawful manner, (ii) comply with all laws, rules, regulations, orders,
ordinances, directions and requirements of any governmental authority or
agency, now in force or which may hereafter be in force, including without
limitation those which shall impose upon Landlord or Tenant any duty with
respect to or triggered by a change in the use or occupation of, or any
improvement or alteration to, the Leased Premises, and (iii) comply with
and obey all reasonable directions of the Landlord, including Rules and
Regulations attached hereto as Exhibit C
and as may be modified from time to time by Landlord on reasonable
nondiscriminatory notice to Tenant. 
Tenant shall not do or permit anything to be done in or about the Leased
Premises or common areas which will in any way obstruct or interfere with the
rights of other tenants or occupants of the Building or injure or annoy
them.  Landlord shall not be responsible
to Tenant for the

 

 

non-performance by any other tenant or occupant of the Building of any
of the Building Rules and Regulations but agrees to take reasonable
measures to assure such other tenant’s compliance.  Tenant shall not overload the floors of the
Leased Premises.  All damage to the floor
structure or foundation of the Building due to improper positioning or storage
of items or materials shall be repaired by Landlord at the sole expense of
Tenant, who shall reimburse Landlord immediately therefor upon demand.  Tenant shall not use the Leased Premises, or
allow the Leased Premises to be used, for any purpose or in any manner which
would invalidate any policy of insurance now or hereafter carried on the
Building or increase the rate of premiums payable on any such insurance policy
unless Tenant reimburses Landlord as Additional Rent for any increase in
premiums charged.

 

Section 5.03.  Landlord’s Rights Regarding Use.  In addition to the rights specified elsewhere
in this Lease, Landlord shall have the following rights regarding the use of
the Leased Premises or the common areas, each of which may be exercised without
notice or liability to Tenant, (a)  Landlord may install such signs,
advertisements, notices or tenant identification information as it shall deem
necessary or proper; (b)  Landlord shall have the right at any time to
control, change or otherwise alter the common areas or utilities servicing the
Building as it shall deem necessary or proper; and (c)  Landlord or
Landlord’s agent shall be permitted to inspect or examine the Leased Premises
at any reasonable time, and Landlord shall have the right to make any repairs
to the Leased Premises which are necessary for its preservation; provided,
however, that any repairs made by Landlord shall be at Tenant’s expense, except
as provided in Section 7.02 hereof. 
Landlord shall incur no liability to Tenant for such entry, nor shall
such entry constitute an eviction of Tenant or a termination of this Lease, or
entitle Tenant to any abatement of rent therefor.  Landlord shall not materially interfere with
Tenant’s access to the Leased Premises.

 

ARTICLE 6 - UTILITIES AND SERVICES

 

Tenant
shall obtain in its own name and pay directly to the appropriate supplier the
cost of all utilities and services serving the Leased Premises.  However, if any services or utilities are
jointly metered with other property, Landlord shall make a reasonable
determination of Tenant’s proportionate share of the cost of such utilities and
services (at rates that would have been payable if such utilities and services
had been directly billed by the utilities or services providers) and Tenant
shall pay such share to Landlord within fifteen (15) days after receipt of
Landlord’s written statement.  Landlord
shall not be liable in damages or otherwise for any failure or interruption of
any utility or other Building service and no such failure or interruption shall
entitle Tenant to terminate this Lease or withhold sums due hereunder.  In the event of utility “deregulation”,
Landlord shall choose the service provider.

 

ARTICLE 7 - MAINTENANCE AND REPAIRS

 

Section 7.01.  Tenant’s Responsibility.  During Lease Term, Tenant shall, at its own
cost and expense, maintain the Leased Premises in good condition, regularly
servicing and promptly making all repairs and replacements thereto, including
but not limited to the electrical systems, heating and air conditioning
systems, plate glass, floors, windows and doors, sprinkler and plumbing
systems, and shall obtain a preventive maintenance contract on the heating,
ventilating and air-conditioning systems, and provide Landlord with a copy
thereof.  The preventive maintenance
contract shall meet or exceed Landlord’s standard maintenance criteria, and
shall provide for the inspection and maintenance of the heating, ventilating
and air conditioning system on not less than a semi-annual basis.

 

Section 7.02.  Landlord’s Responsibility.  During the term of this Lease, Landlord shall
maintain in good condition and repair, and replace as necessary, the roof,
exterior walls, foundation and structural frame of the Building and the parking
and landscaped areas, the costs of which shall be included in Operating
Expenses; provided, however, that to the extent any of the foregoing items
require repair because of the negligence, misuse, or default of Tenant, its
employees, agents, customers or invitees, Landlord shall make such repairs
solely at Tenant’s expense.

 

Section 7.03.  Alterations.  Tenant shall not permit alterations in or to
the Leased Premises unless and until Landlord has approved the plans therefor
in writing, such approval shall not be unreasonably withheld.  As a condition of such approval, Landlord may
require Tenant to remove the alterations and restore the Leased Premises upon termination
of this Lease; otherwise, all such alterations shall at Landlord’s option
become a part of the realty and the property of Landlord, and shall not be
removed by Tenant.  Landlord shall notify
Tenant of any such requirement at the time of approval of such
alterations.  Tenant shall ensure that
all 

 

alterations shall be made in accordance with all applicable laws,
regulations and building codes, in a good and workmanlike manner and of quality
equal to or better than the original construction of the Building.  No person shall be entitled to any lien
derived through or under Tenant for any labor or material furnished to the
Leased Premises, and nothing in this Lease shall be construed to constitute
Landlord’s consent to the creation of any lien. 
If any lien is filed against the Leased Premises for work claimed to
have been done for or material claimed to have been furnished to Tenant, Tenant
shall cause such lien to be discharged of record within thirty (30) days after
filing.  Tenant shall indemnify Landlord
from all costs, losses, expenses and attorneys’ fees in connection with any
construction or alteration and any related lien.  Tenant agrees that at Landlord’s option, Duke
Construction Limited Partnership or a subsidiary or affiliate of Landlord, who
shall receive a fee as Landlord’s construction manager or general contractor,
shall perform all work on (i) any alterations to the heating, ventilating
and air conditioning systems serving the warehouse portion of the Leased
Premises, and (ii) any alterations that change the floor plan of the
Leased Premises from that which is attached hereto as Exhibit F and made a part hereof.

 

ARTICLE 8 - CASUALTY

 

Section 8.01.  Casualty.  In the event of total or partial destruction
of the Building or the Leased Premises by fire or other casualty, Landlord
agrees to promptly restore and repair the Leased Premises; provided, however,
Landlord’s obligation hereunder shall be limited to the reconstruction of such
of the tenant finish improvements as were originally required to be made by
Landlord, if any.  Rent shall
proportionately abate during the time that the Leased Premises or part thereof
are unusable because of any such damage. 
Notwithstanding the foregoing, if the Leased Premises are (i) so
destroyed that they cannot be repaired or rebuilt within one hundred eighty
(180) days from the casualty date; or (ii) destroyed by a casualty which
is not covered by the insurance required hereunder or, if covered, such
insurance proceeds are not released by any mortgagee entitled thereto or are
insufficient to rebuild the Building and the Leased Premises; then, in case of
a clause (i) casualty, either Landlord or Tenant may, or, in the case of a
clause (ii) casualty, then Landlord may, upon thirty (30) days’ written
notice to the other party, terminate this Lease with respect to matters
thereafter accruing.  Landlord shall use
commercially reasonable efforts to notify Tenant within thirty (30) days after
the casualty date of Landlord’s decision to repair, rebuild and restore the
Leased Premises or to terminate this Lease as provided for herein.

 

Section 8.02.  Fire and Extended Coverage Insurance.  During the Lease Term, Landlord shall
maintain all risk coverage insurance on the Building, but shall not protect
Tenant’s property on the Leased Premises; and, notwithstanding the provisions
of Section 9.01, Landlord shall not be liable for any damage to
Tenant’s property, regardless of cause, including the negligence of Landlord
and its employees, agents and invitees. 
Tenant hereby expressly waives any right of recovery against Landlord
for damage to any property of Tenant located in or about the Leased Premises,
however caused, including the negligence of Landlord and its employees, agents
and invitees.  Notwithstanding the provisions
of Section 9.01 below, Landlord hereby expressly waives any rights
of recovery against Tenant for damage to the Leased Premises or the Building
which is insured against under Landlord’s all risk coverage insurance.  All insurance policies maintained by Landlord
or Tenant as provided in this Lease shall contain an agreement by the insurer
waiving the insurer’s right of subrogation against the other party to this
Lease.

 

ARTICLE 9 - LIABILITY INSURANCE

 

Section 9.01.  Tenant’s Responsibility.  Landlord shall not be liable to Tenant or to
any other person for (i) damage to property or injury or death to persons
due to the condition of the Leased Premises, the Building or the common areas,
or (ii) the occurrence of any accident in or about the Leased Premises or
the common areas, or (iii) any act or neglect of Tenant or any other
tenant or occupant of the Building or of any other person, unless such damage,
injury or death is directly and solely the result of Landlord’s negligence; and
Tenant hereby releases Landlord from any and all liability for the same except
for damages occasioned by Landlord’s negligence.  Tenant shall be liable for, and shall
indemnify and defend Landlord from, any and all liability for (i) any act
or neglect of Tenant and any person coming on the Leased Premises or common
areas by the license of Tenant, express or implied, (ii) any damage to the
Leased Premises, and (iii) any loss of or damage or injury to any person
(including death resulting therefrom) or property occurring in, on or about the
Leased Premises, regardless of cause, except for any loss or damage from fire
or casualty insured as provided in Section 8.02 and 

 

 

except for that caused directly by Landlord’s negligence.  This provision shall survive the expiration
or earlier termination of this Lease.

 

Section 9.02.  Tenant’s Insurance.  Tenant shall carry general public liability
and property damage insurance, issued by one or more insurance companies
acceptable to Landlord, with the following minimum coverages:

 

A.            Worker’s
Compensation:  minimum statutory amount.

 

B.            Commercial
General Liability Insurance, including blanket, contractual liability, broad
form property damage, personal injury, completed operations, products
liability, and fire damage:  Not less
than $3,000,000 Combined Single Limit for both bodily injury and property
damage.

 

C.            All Risk
Coverage, Vandalism and Malicious Mischief, and Sprinkler Leakage insurance, if
applicable, for the full cost of replacement of Tenant’s property.

 

D.            Business
interruption insurance.

 

The insurance policies
shall protect Tenant and Landlord as their interests may appear, naming
Landlord and Landlord’s managing agent and mortgagee as additional insureds,
and shall provide that they may not be canceled on less than thirty (30) days’
prior written notice to Landlord.  Tenant
shall furnish Landlord with Certificates of Insurance evidencing all required
coverages on or before the Commencement Date. 
If Tenant fails to carry such insurance and furnish Landlord with such
Certificates of Insurance after a request to do so, Landlord may obtain such
insurance and collect the cost thereof from Tenant.

 

ARTICLE 10 - EMINENT DOMAIN

 

If all
or any substantial part of the Building or common areas shall be acquired by
the exercise of eminent domain, Landlord may terminate this Lease by giving
written notice to Tenant within fifteen (15) days after possession thereof is
so taken.  If all or any part of the
Leased Premises shall be acquired by the exercise of eminent domain so that the
Leased Premises shall become unusable by Tenant for the Permitted Use, Tenant
may terminate this Lease by giving written notice to Landlord within fifteen
(15) days after possession thereof is so taken. 
All damages awarded shall belong to Landlord; provided, however, that
Tenant may claim dislocation damages if such amount is not subtracted from
Landlord’s award.

 

ARTICLE 11 - ASSIGNMENT AND SUBLEASE

 

Tenant shall not assign this Lease or sublet the
Leased Premises in whole or in part without Landlord’s prior written consent,
which consent shall not be unreasonably withheld, delayed or denied.  In the event of any assignment or subletting,
Tenant shall remain primarily liable hereunder. 
The acceptance of rent from any other person shall not be deemed to be a
waiver of any of the provisions of this Lease or to be a consent to the
assignment of this Lease or the subletting of the Leased Premises.  Without in any way limiting Landlord’s right
to refuse to consent to any assignment or subletting of this Lease, Landlord
reserves the right to refuse to give such consent if in Landlord’s opinion (i) the
Leased Premises are or may be in any way adversely affected; (ii) the
business reputation of the proposed assignee or subtenant is unacceptable; or (iii) the
financial worth of the proposed assignee or subtenant is insufficient to meet
the obligations hereunder.  Landlord
further expressly reserves the right to refuse to give its consent to any
subletting if the proposed rent is to be publicly advertised (such as by fliers,
letters, and written or electronic marketing materials) to be less than the
then current rent for similar premises in the Park; provided that Tenant or its
broker shall not be precluded from marketing the Leased Premises for sublease
pursuant to customary methods employed by the commercial real estate brokerage
community in the market.  If Tenant shall
make any assignment or sublease, with Landlord’s consent, for a rental in
excess of the rent payable under this Lease, Tenant shall not be entitled to
keep such excess, and Tenant shall pay to Landlord fifty percent (50%) of any
such excess rental upon receipt.  Tenant
agrees to reimburse Landlord for reasonable accounting and attorneys’ fees
incurred in conjunction (not to exceed One Thousand Dollars ($1,000.00)) with
the processing and documentation of any such requested assignment, subletting
or any other hypothecation of this Lease or Tenant’s interest in and to the
Leased Premises.  Notwithstanding the
foregoing, Tenant may assign the Lease or sublease all or any portion of the
Leased Premises without Landlord’s consent to any of the following (a “Permitted
Transferee”), provided that the Permitted Transferee’s financial condition,
creditworthiness and business reputation following the transfer are equal to or
exceed those of Tenant:  (i) any 

 

 

successor corporation or other entity resulting from a merger or
consolidation of Tenant; (ii) any purchaser of all or substantially all of
Tenant’s assets; or (iii) any entity which controls, is controlled by, or
is under common control with Tenant. 
Tenant shall give Landlord at least thirty (30) days’ prior written
notice of such assignment or sublease. 
Any Permitted Transferee shall assume in writing all of Tenant’s
obligations under this Lease.  Tenant
shall nevertheless at all times remain fully responsible and liable for the
payment of rent and the performance and observance of all of Tenant’s other
obligations under this Lease.  Nothing in
this paragraph is intended to nor shall permit Tenant to transfer its interest
under this Lease as part of a fraud or subterfuge to intentionally avoid its
obligations under this Lease (for example, transferring its interest to a shell
corporation that subsequently files a bankruptcy), and any such transfer shall
constitute an Event of Default hereunder.

 

ARTICLE 12 - TRANSFERS BY LANDLORD

 

Section 12.01.  Sale of the Building.  Landlord shall have the right to sell the
Building at any time during the Lease Term, subject only to the rights of
Tenant hereunder; and such sale shall operate to release Landlord from
liability hereunder after the date of such conveyance.

 

Section 12.02.  Subordination and Estoppel Certificate.  Within ten (10) days following receipt
of a written request from Landlord, Tenant shall execute and deliver to
Landlord, without cost, an estoppel certificate in such form as Landlord may
reasonably request certifying (i) that this Lease is in full force and
effect and unmodified or stating the nature of any modification, (ii) the
date to which rent has been paid, (iii) that there are not, to Tenant’s
knowledge, any uncured defaults or specifying such defaults if any are claimed,
and (iv) any other matters or state of facts reasonably required
respecting the Lease.  Such estoppel may
be relied upon by Landlord and by any purchaser or mortgagee of the
Building.  This Lease is and shall be
expressly subject and subordinate at all times to the lien of any present or
future mortgage or deed of trust encumbering fee title to the Leased
Premises.  If any such mortgage or deed
of trust be foreclosed, upon request of the mortgagee or beneficiary (“Landlord’s
Mortgagee”), as the case may be, Tenant will attorn to the purchaser at the
foreclosure sale.  The foregoing
provisions are declared to be self-operative and no further instruments shall
be required to effect such subordination and/or attornment; provided, however,
that subordination of this Lease to any present or future mortgage or trust
deed shall be conditioned upon the mortgagee, beneficiary, or purchaser at
foreclosure, as the case may be agreeing that Tenant’s occupancy of the Leased
Premises and other rights under this Lease shall not be disturbed by reason of
the foreclosure of such mortgage or trust deed, as the case may be, so long as
Tenant is not in default under this Lease; and further provided that Tenant
agrees upon request by any such mortgagee, beneficiary, or purchaser at
foreclosure, as the case may be, to execute such non-disturbance, subordination
and/or attornment instruments as may be reasonably required by such person to
confirm such non-disturbance subordination and/or attornment.

 

Any
Landlord’s Mortgagee may elect, at any time, unilaterally, to make this Lease
superior to its mortgage or other interest in the Leased Premises by so notifying
Tenant in writing.

 

Tenant
shall not seek to enforce any remedy it may have for any default on the part of
Landlord without first giving written notice by certified mail, return receipt
requested, specifying the default in reasonable detail, to any Landlord’s
Mortgagee whose address has been given to Tenant, and affording such Landlord’s
Mortgagee a reasonable opportunity to perform Landlord’s obligations hereunder.

 

If
Landlord’s Mortgagee shall succeed to the interest of Landlord under this
Lease, Landlord’s Mortgagee shall not be: 
(1) liable for any act or omission of any prior landlord (including
Landlord); (2) bound by any rent or additional rent or advance rent which
Tenant might have paid for more than the current month to any prior landlord
(including Landlord), and all such rent shall remain due and owing,
notwithstanding such advance payment; (3) bound by any security or advance
rental deposit made by Tenant which is not delivered or paid over to Landlord’s
Mortgagee and with respect to which Tenant shall look solely to Landlord for
refund or reimbursement (provided, however, that Landlord shall be responsible
for delivering any Security Deposit hereunder to Landlord’s Mortgagee at the
time Landlord’s Mortgagee succeeds to Landlord’s interest hereunder); (4) bound
by any termination, amendment or modification of this Lease made without
Landlord’s Mortgagee’s consent and written approval, except for those
terminations, amendments and modifications permitted to be made by Landlord
without Landlord’s Mortgagee’s consent pursuant to the terms of the loan
documents between Landlord and Landlord’s Mortgagee; (5) subject to the
defenses which Tenant might have against any prior landlord (including
Landlord); and (6) subject to the offsets which Tenant might have against 

 

 

any prior landlord (including Landlord) except for those offset rights
which (A) are expressly provided in this Lease, (B) relate to periods
of time following the acquisition of the Building by Landlord’s Mortgagee, and (C) Tenant
has provided written notice to Landlord’s Mortgagee and provided Landlord’s
Mortgagee a reasonable opportunity (the duration of which shall not exceed
thirty (30) days after Landlord’s Mortgagee takes possession of the Building)
to cure the event giving rise to such offset event.  Landlord’s Mortgagee shall have no liability
or responsibility under or pursuant to the terms of this Lease or otherwise
after it ceases to own an interest in the Building.  Nothing in this Lease shall be construed to
require Landlord’s Mortgagee to see to the application of the proceeds of any
loan, and Tenant’s agreements set forth herein shall not be impaired on account
of any modification of the documents evidencing and securing any loan.

 

ARTICLE 13 - DEFAULT AND REMEDY

 

Section 13.01.  Default.  The occurrence of any of the following shall
be a “Default”:

 

(a) 
Tenant fails to pay any Monthly Rental Installment or Additional Rent within
five (5) days after the same is due, or Tenant fails to pay any other
amounts due Landlord from Tenant within ten (10) days after the same is
due.

 

(b) 
Tenant fails to perform or observe any other term, condition, covenant or
obligation required under this Lease for a period of ten (10) days after
notice thereof from Landlord; provided, however, that if the nature of Tenant’s
default is such that more than ten days are reasonably required to cure, then
such default shall be deemed to have been cured if Tenant commences such
performance within said ten-day period and thereafter diligently completes the
required action within a reasonable time.

 

(c) 
Tenant shall assign or sublet all or a portion of the Leased Premises in
contravention of the provisions of Article 11 of this Lease.

 

(d) 
All or substantially all of Tenant’s assets in the Leased Premises or Tenant’s
interest in this Lease are attached or levied under execution (and Tenant does
not discharge the same within sixty (60) days thereafter); a petition in
bankruptcy, insolvency or for reorganization or arrangement is filed by or
against Tenant (and Tenant fails to secure a stay or discharge thereof within
sixty (60) days thereafter); Tenant is insolvent and unable to pay its debts as
they become due; Tenant makes a general assignment for the benefit of
creditors; Tenant takes the benefit of any insolvency action or law; the
appointment of a receiver or trustee in bankruptcy for Tenant or its assets if
such receivership has not been vacated or set aside within thirty (30) days
thereafter; or, dissolution or other termination of Tenant’s corporate charter
if Tenant is a corporation.

 

(e) 
In addition to the defaults and remedies described herein, the parties agree
that if Tenant is in violation of the performance of any (but not necessarily
the same) term or condition of this Lease three (3) or more times during
any twelve (12) month period, regardless of whether such violations are
ultimately cured, then such conduct shall, at Landlord’s option, represent a
separate Default.

 

Section 13.02.  Remedies.  Upon the occurrence of any Default, Landlord
shall have the following rights and remedies, in addition to those allowed by
law or in equity, any one or more of which may be exercised without further
notice to Tenant:

 

(a) 
Landlord may apply the Security Deposit or re-enter the Leased Premises and
cure any default of Tenant, and Tenant shall reimburse Landlord as additional
rent for any costs and expenses which Landlord thereby incurs; and Landlord
shall not be liable to Tenant for any loss or damage which Tenant may sustain
by reason of Landlord’s action.

 

(b) 
Landlord may terminate this Lease or, without terminating this Lease, terminate
Tenant’s right to possession of the Leased Premises as of the date of such
default, and thereafter (i) neither Tenant nor any person claiming under
or through Tenant shall be entitled to possession of the Leased Premises, and
Tenant shall immediately surrender the Leased Premises to Landlord; and (ii) Landlord
may re-enter the Leased Premises and dispossess Tenant and any other occupants
of the Leased Premises by any lawful means and may remove their effects,
without prejudice to any other remedy which Landlord may have.  Upon the termination of this Lease, Landlord
may declare the present value (discounted at the Prime Rate of interest) of all
rent which would have been due under this Lease for the balance of the Lease
Term to be immediately due and payable, whereupon Tenant shall be obligated to
pay the same to Landlord, together with all loss or damage which Landlord may
sustain by reason of Tenant’s 

 

 

default (“Default Damages”), which shall include without limitation
expenses of preparing the Leased Premises for re-letting, demolition, repairs,
tenant finish improvements and brokers’ and attorneys’ fees, it being expressly
understood and agreed that the liabilities and remedies specified in this subsection (b) shall
survive the termination of this Lease.

 

(c) 
Landlord may, without terminating this Lease, re-enter the Leased Premises and
re-let all or any part thereof for a term different from that which would otherwise
have constituted the balance of the Lease Term and for rent and on terms and
conditions different from those contained herein, whereupon Tenant shall be
immediately obligated to pay to Landlord as liquidated damages the difference
between the rent provided for herein and that provided for in any lease
covering a subsequent re-letting of the Leased Premises, for the period which
would otherwise have constituted the balance of the Lease Term, together with
all of Landlord’s Default Damages.

 

(d) 
Landlord may sue for injunctive relief or to recover damages for any loss
resulting from the breach.

 

(e) 
If Landlord has terminated this Lease or Tenant’s right to possession, Landlord
agrees to use commercially reasonable efforts to mitigate its damages.  Landlord shall be required only to use
reasonable efforts to mitigate, which shall not exceed such efforts as Landlord
generally uses to lease other space in the Building.  Landlord will not be deemed to have failed to
mitigate if Landlord leases any other portions of the Building before reletting
all or any portion of the Leased Premises. 
Landlord shall not be deemed to have failed to mitigate if it incurs
Default Damages.  If Tenant has paid
Landlord the present value of all rent due plus Default Damages as set forth in
Section 13.02(b) above, Landlord agrees to pay Tenant any rent
received by Landlord from any tenant who leases the Leased Premises which
amount was already paid by Tenant as part of the accelerated rent.

 

Section 13.03.  Landlord’s Default and Tenant’s Remedies.  Landlord shall be in default if it fails to
perform any term, condition, covenant or obligation required under this Lease
for a period of thirty (30) days after written notice thereof from Tenant to
Landlord; provided, however, that if the term, condition, covenant or
obligation to be performed by Landlord is such that it cannot reasonably be
performed within thirty (30) days, such default shall be deemed to have been
cured if Landlord commences such performance within said thirty-day period and
thereafter diligently undertakes to complete the same.  Upon the occurrence of any such default,
Tenant may sue for injunctive relief or to recover damages for any loss
directly resulting from the breach, but Tenant shall not be entitled to terminate
this Lease or withhold, offset or abate any sums due hereunder.

 

Section 13.04.  Limitation of Landlord’s Liability.  If Landlord shall fail to perform any term,
condition, covenant or obligation required to be performed by it under this
Lease and if Tenant shall, as a consequence thereof, recover a money judgment
against Landlord, Tenant agrees that it shall look solely to Landlord’s right,
title and interest in and to the Building for the collection of such judgment;
and Tenant further agrees that no other assets of Landlord shall be subject to
levy, execution or other process for the satisfaction of Tenant’s judgment.

 

Section 13.05.  Nonwaiver of Defaults.  Neither party’s failure or delay in
exercising any of its rights or remedies or other provisions of this Lease
shall constitute a waiver thereof or affect its right thereafter to exercise or
enforce such right or remedy or other provision.  No waiver of any default shall be deemed to
be a waiver of any other default. 
Landlord’s receipt of less than the full rent due shall not be construed
to be other than a payment on account of rent then due, nor shall any statement
on Tenant’s check or any letter accompanying Tenant’s check be deemed an accord
and satisfaction.  No act or omission by
Landlord or its employees or agents during the term of this Lease shall be
deemed an acceptance of a surrender of the Leased Premises, and no agreement to
accept such a surrender shall be valid unless in writing and signed by
Landlord.

 

Section 13.06.  Attorneys’ Fees.  If either party defaults in the performance
or observance of any of the terms, conditions, covenants or obligations
contained in this Lease and the non-defaulting party obtains a judgment against
the defaulting party, then the defaulting party agrees to reimburse the
non-defaulting party for the attorneys’ fees incurred thereby.

 

ARTICLE 14 - LANDLORD’S RIGHT TO RELOCATE TENANT

 

[Intentionally Omitted].

 

 

ARTICLE 15 - TENANT’S RESPONSIBILITY REGARDING

ENVIRONMENTAL LAWS AND HAZARDOUS SUBSTANCES.

 

Section 15.01.  Definitions.

 

(a)           “Environmental
Laws” - All present or future federal, state and municipal laws, ordinances, rules and
regulations applicable to the environmental and ecological condition of the
Leased Premises, the rules and regulations of the Federal Environmental
Protection Agency or any other federal, state or municipal agency or
governmental board or entity having jurisdiction over the Leased Premises.

 

(b)           “Hazardous
Substances” - Those substances included within the definitions of “hazardous
substances,” “hazardous materials,” “toxic substances” “solid waste” or “infectious
waste” under Environmental Laws.

 

Section 15.02.  Compliance.  Tenant, at its sole cost and expense, shall
promptly comply with the Environmental Laws including any notice from any
source issued pursuant to the Environmental Laws or issued by any insurance
company which shall impose any duty upon Tenant with respect to the use,
occupancy, maintenance or alteration of the Leased Premises whether such notice
shall be served upon Landlord or Tenant.

 

Section 15.03.  Restrictions on Tenant.  Tenant shall operate its business and
maintain the Leased Premises in compliance with all Environmental Laws.  Tenant shall not cause or permit the use,
generation, release, manufacture, refining, production, processing, storage or
disposal of any Hazardous Substances on, under or about the Leased Premises, or
the transportation to or from the Leased Premises of any Hazardous Substances,
except as necessary and appropriate for its Permitted Use in which case the
use, storage or disposal of such Hazardous Substances shall be performed in
compliance with the Environmental Laws and the highest standards prevailing in
the industry.

 

Section 15.04.  Notices, Affidavits, Etc.  Tenant shall immediately notify Landlord of (i) any
violation by Tenant, its employees, agents, representatives, customers,
invitees or contractors of the Environmental Laws on, under or about the Leased
Premises, or (ii) the presence or suspected presence of any Hazardous
Substances on, under or about the Leased Premises and shall immediately deliver
to Landlord any notice received by Tenant relating to (i) and (ii) above
from any source.  Tenant shall execute
affidavits, representations and the like within five (5) days of Landlord’s
request therefor concerning Tenant’s best knowledge and belief regarding the
presence of any Hazardous Substances on, under or about the Leased Premises.

 

Section 15.05.  Landlord’s Rights.  Landlord and its agents shall have the right,
but not the duty, upon advance notice (except in the case of emergency when no
notice shall be required) to inspect the Leased Premises and conduct tests
thereon to determine whether or the extent to which there has been a violation
of Environmental Laws by Tenant or whether there are Hazardous Substances on,
under or about the Leased Premises.  In
exercising its rights herein, Landlord shall use reasonable efforts to minimize
interference with Tenant’s business but such entry shall not constitute an
eviction of Tenant, in whole or in part, and Landlord shall not be liable for
any interference, loss, or damage to Tenant’s property or business caused
thereby.

 

Section 15.06.  Tenant’s Indemnification.  Tenant shall indemnify Landlord and Landlord’s
managing agent from any and all claims, losses, liabilities, costs, expenses
and damages, including attorneys’ fees, costs of testing and remediation costs,
incurred by Landlord in connection with any breach by Tenant of its obligations
under this Article 15.  The covenants
and obligations under this Article 15 shall survive the expiration or
earlier termination of this Lease.

 

Section 15.07.  Landlord’s Representation.  Notwithstanding anything contained in this Article 15
to the contrary, Tenant shall not have any liability to Landlord under this Article 15
resulting from any conditions existing, or events occurring, or any Hazardous
Substances existing or generated, at, in, on, under or in connection with the
Leased Premises prior to the Commencement Date of this Lease except to the
extent Tenant exacerbates the same.

 

ARTICLE 16 - MISCELLANEOUS

 

Section 16.01.  Benefit of Landlord and Tenant.  This Lease shall inure to the benefit of and
be binding upon Landlord and Tenant and their respective successors and
assigns.

 

 

Section 16.02.  Governing Law.  This Lease shall be governed in accordance
with the laws of the State of where the Building is located.

 

Section 16.03.  Guaranty.  [Intentionally Omitted].

 

Section 16.04.  Force Majeure.  Landlord and Tenant (except with respect to
any rent payment obligation) shall be excused for the period of any delay in
the performance of any obligation hereunder when such delay is occasioned by
causes beyond its control, including but not limited to work stoppages,
boycotts, slowdowns or strikes; shortages of materials, equipment, labor or
energy; unusual weather conditions; or acts or omissions of governmental or
political bodies.

 

Section 16.05.  Examination of Lease.  Submission of this instrument for examination
or signature to Tenant does not constitute a reservation of or option for
Lease, and it is not effective as a Lease or otherwise until execution by and
delivery to both Landlord and Tenant.

 

Section 16.06.  Indemnification for Leasing Commissions.  The parties hereby represent and warrant that
the only real estate brokers involved in the negotiation and execution of this
Lease are the Brokers.  Landlord shall
pay commissions to the Brokers pursuant to a separate agreement.  Each party shall indemnify the other from any
and all liability for the breach of this representation and warranty on its
part and shall pay any compensation to any other broker or person who may be
entitled thereto.

 

Section 16.07.  Notices.  Any notice required or permitted to be given
under this Lease or by law shall be deemed to have been given if it is written
and delivered in person or by overnight courier or mailed by certified mail,
postage prepaid, to the party who is to receive such notice at the address
specified in Article 1.  When so
mailed, the notice shall be deemed to have been given as of the date it was
mailed.  Either party may change its
address by giving written notice thereof to the other party.

 

Section 16.08.  Partial Invalidity; Complete Agreement.  If any provision of this Lease shall be held
to be invalid, void or unenforceable, the remaining provisions shall remain in
full force and effect.  This Lease
represents the entire agreement between Landlord and Tenant covering everything
agreed upon or understood in this transaction. 
There are no oral promises, conditions, representations, understandings,
interpretations or terms of any kind as conditions or inducements to the
execution hereof or in effect between the parties.  No change or addition shall be made to this
Lease except by a written agreement executed by Landlord and Tenant.

 

Section 16.09.  Financial Statements.  During the Lease Term and any extensions
thereof, Tenant shall provide to Landlord on an annual basis, within ninety
(90) days following the end of Tenant’s fiscal year, a copy of Tenant’s most
recent financial statements (certified and audited if the Minimum Annual Rent
hereunder exceeds $100,000.00) prepared as of the end of Tenant’s fiscal
year.  Such financial statements shall be
signed by Tenant who shall attest to the truth and accuracy of the information
set forth in such statements, or if the Minimum Annual Rent hereunder exceeds
$100,000.00, said statements shall be certified and audited.  All financial statements provided by Tenant
to Landlord hereunder shall be prepared in conformity with generally accepted
accounting principles, consistently applied. 
Notwithstanding the foregoing, if (i) the named tenant, Gaiam, Inc.,
is Tenant, (ii) Tenant’s financial statements are publicly available, and (iii) such
statements comply with the provisions hereinabove, then Landlord shall not
request Tenant’s financial statements from Tenant.

 

Section 16.10.  Representations and Warranties.  The undersigned represent and warrant that (i) such
party is duly organized, validly existing and in good standing (if applicable)
in accordance with the laws of the state under which it was organized; and (ii) the
individual executing and delivering this Lease has been properly authorized to
do so, and such execution and delivery shall bind such party.

 

Section 16.11.  Agency Disclosure.  Tenant acknowledges having previously
received the Agency Disclosure Statement attached.  The broker as provided in Item I of the Basic
Lease Provisions, its agents and employees, have represented only Landlord, and
have not in any way represented Tenant, in the marketing, negotiation, and
completion of this lease transaction.

 

Section 16.12.  Signs. 
Tenant may, at its own expense, erect a sign concerning the business of
Tenant which shall be in keeping with the decor and other signs on the
Building.  All 

 

 

signage (including the signage described in the preceding sentence) in
or about the Leased Premises shall be first approved by Landlord, which
approval shall not be unreasonably withheld, and all signage shall be in
compliance with the applicable codes and any recorded restrictions applicable
to the Building.  Tenant agrees to
maintain any sign in good state of repair, and upon expiration of the Lease
Term, Tenant agrees to promptly remove such signs and repair any resulting
damage to the Leased Premises.

 

Section 16.13.  ERISA Matters.

 

(a)           Tenant
acknowledges that it has been advised that an affiliate of Landlord is a
collective investment fund (the “Fund”) which holds the assets of one or more
employee benefit plans or retirement arrangements which are subject to Title I
of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”)
and/or Section 4975 of the Internal Revenue Code of 1986, as amended (the “Code”)
(each a “Plan”), and with respect to which Morgan Guaranty Trust Company of New
York (“MGT”) is the Trustee and that, as a result, Landlord may be prohibited
by law from engaging in certain transactions.

 

(b)           Landlord
hereby represents and warrants to Tenant that, as of the date hereof, the only
Plans whose assets are invested in the Fund which, together with the interests
of any other Plans maintained by the same employer or employee organization,
represent a collective interest in the Fund in excess of ten percent (10%) of
the total interests in the Fund (each, a “10% Plan”) are referenced on Exhibit D (collectively, the “Existing
10% Plan”).

 

(c)           Tenant
represents and warrants that as of the date hereof, and at all times while it
is a Tenant under this Lease, one of the following statements is, and will
continue to be, true:  (1) Tenant is
not a “party in interest” (as defined in Section 3(14) of ERISA) or a “disqualified
person” (as defined in Section 4975 of the Code) (each, a “Party in
Interest”) with respect to the Existing 10% Plan or, (2) if Tenant is a
Party in Interest, that:

 

(A)          neither
Tenant nor its “affiliate” (as defined in Section V(c) of PTCE 84-14,
“Affiliate”) has, or during the immediately preceding one (1) year has,
exercised the authority to either:  (i) appoint
or terminate MGT as the qualified professional asset manager (as defined in Section V(a) of
PTCE 84-14, “QPAM”) of any of the assets of the Existing 10% Plan with respect
to which Tenant or its Affiliate is a Party in Interest; or (ii) negotiate
the terms of the management agreement with MGT, including renewals or
modifications thereof, on behalf of the Existing 10% Plan; and

 

(B)           neither
Tenant nor any entity controlling, or controlled by Tenant owns a five percent
(5%) or more interest (within the meaning of PTCE 84-14, “5% Interest”) in J.P.
Morgan Chase & Co.

 

(d)           In
the event that Landlord or the Fund notifies Tenant in writing that a Plan
other than the Existing 10% Plan may become a 10% Plan, Tenant will, within ten
(10) days of such notification, inform the Fund in writing as to whether
it can make the same representations which it made in subsection (c) of
this Section with respect to such prospective 10% Plan.  Thereafter, if based on such representations
made by Tenant such Plan becomes a 10% Plan, Tenant represents and warrants
that, at all times during the period Tenant is a tenant under the Lease, one of
the statements set forth in subsection (c) will be true with respect
to such 10% Plan.

 

[SIGNATURES CONTAINED ON THE FOLLOWING PAGES]

 

 

IN
WITNESS WHEREOF, the parties hereto have executed this Lease as of the day and
year first above written.

 

	
   

  	
  LANDLORD:

  
	
   

  	
  DUGAN REALTY, L.L.C.,

  
	
   

  	
  an Indiana limited liability company

  
	
   

  	
   

  
	
   

  	
  By:

  	
  Duke Realty Limited Partnership,

  
	
   

  	
   

  	
  an Indiana limited partnership, its

  
	
   

  	
  member

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  Duke Realty Corporation,

  
	
   

  	
   

  	
  an Indiana corporation,

  
	
   

  	
   

  	
  its general partner

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Kevin T. Rogus

  
	
   

  	
   

  	
   

  	
  Senior Vice President

  

 

	
   

  	
  TENANT:

  
	
   

  	
   

  
	
   

  	
  GAIAM, INC., a
  Colorado corporation

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Printed:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
						

 

	
  STATE OF OHIO

  	
  )

  
	
   

  	
  ) SS:

  
	
  COUNTY OF HAMILTON

  	
  )

  

 

Before me, a Notary
Public in and for said County and State, personally appeared Kevin T. Rogus, by
me known to be the Senior Vice President of Duke Realty Corporation, the
general partner of Duke Realty Limited Partnership, the member of Dugan Realty,
L.L.C., an Indiana limited liability company, who acknowledged the execution of
the foregoing “Office Lease” on behalf of said limited liability company.

 

WITNESS
my hand and Notarial Seal this              
day of                                                    ,
2005.

 

	
   

  	
   

  	
   

  
	
   

  	
  Notary Public

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  (Printed
  Signature)

  
	
   

  	
   

  

 

	
  My Commission
  Expires:

  	
   

  	
   

  	
   

  
	
   

  	
   

  
	
  My County of
  Residence:Exhibit
10.14

 

 

Gaiam,
Inc.

Executive
Officer Compensation

 

	
  Name

  	
   

  	
  Title

  	
   

  	
  Annual
  Base Salary

  
	
  Jane Pemberton

  	
   

  	
  President of GT Media and Gaiam Trade Decision

  	
   

  	
  $

  	
  300,000

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Lou Weiss

  	
   

  	
  President of Direct, GT Media

  	
   

  	
  $

  	
  285,000

  

 

Ms. Pemberton will receive a bonus of $150,000 during her first year of
service, to be paid in equal installments on May 1, 2007 and December 1,
2007.  Thereafter, she may receive a
bonus of up to 50% of salary, with the award being determined by reference to a
matrix of possible performance levels based on Gaiam’s achievement of revenue
and pre-tax earnings objectives under Gaiam’s financial plan.  Ms. Pemberton will also be reimbursed for up
to $25,000 of moving expenses, she will receive a monthly housing/cost of
living allowance of $5,000, and she received options to purchase 75,000 shares
of Gaiam Class A common stock.  Ms.
Pemberton will be entitled to a severance payment of $60,000 if terminated
without cause.

 

Mr. Weiss may receive a bonus of up to 50% of salary, with the award
being determined by reference to a matrix of possible performance levels based
on Gaiam’s achievement of revenue and pre-tax earnings objectives under Gaiam’s
financial plan.  Mr. Weiss’ bonus for the
12 months ending September 30, 2006 is guaranteed to be at least $27,500
quarterly.  In addition, Mr. Weiss
received a bonus of $25,000 upon the closing of Gaiam’s acquisition of certain
assets of GoodTimes Entertainment and options to purchase 75,000 shares of
Gaiam Class A common stock.

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