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HomeMy WebLinkAboutAgenda - 01-21-20 8-l - Lease of 308 W. Franklin Street and Suite 101 at the Europa Center, and Approval of Budget Amendment #4-C 1 ORD-2020-003 ORANGE COUNTY BOARD OF COMMISSIONERS ACTION AGENDA ITEM ABSTRACT Meeting Date: January 21, 2020 Action Agenda Item No. 8-1 SUBJECT: Lease of 308 W. Franklin Street and Suite 101 at the Europa Center, and Approval of Budget Amendment #4-C DEPARTMENT: Asset Management Services ATTACHMENT(S): INFORMATION CONTACT: 1) Lease of 308 W. Franklin Street Steven Arndt, AMS Director, 2) Lease of Suite 101- Europa Center 919-245-2628 Alan Dorman, AMS Assistant Director, 919-245-2627 PURPOSE: To authorize the Manager to sign the lease for 308 W. Franklin Street and the lease for Suite 101, Europa Center, upon final review by the County Attorney, and approve Budget Amendment #4-C. BACKGROUND: On November 19, 2019, it was announced that Orange County would provide two of its facilities, 501 and 503 West Franklin to Well Dot, Inc., a healthcare technology company, at terms to be determined in the coming months. Well Dot will renovate the facilities for the purpose of establishing a new operations and corporate center in Chapel Hill that will create about 400 high-paying jobs over five years. It is, therefore, necessary to find new locations for the County departments and County supported agencies housed at these facilities. 501 and 503 West Franklin are occupied by the Chapel Hill/Orange County Visitors Bureau, Guardian ad Litem, and the Skills Development Center. Two other organizations lease space from the County at 501 West Franklin — Seal the Seasons and ISLA (Immersion for Spanish Language Acquisition), both of which are in the process of finding new spaces to lease. After an exhaustive search, the County has identified two separate locations that will fit the needs of the affected departments. If the Board approves the leases for these spaces, the County will begin the process of selecting an architectural firm to design the renovations, bid the work, and manage the construction process. The leases of Suite 101 at the Europa Center and 308 West Franklin Street will begin March 1st and April 1st, 2020 respectively, with an expected move-in date of June 2020 after the renovations have been completed. The Chapel Hill/Orange County Visitors Bureau reviewed potential sites on 1-40 and in Carrboro and Chapel Hill and has identified 308 West Franklin Street as an ideal location. The 4,000 square foot facility is visually welcoming with 17 parking spaces, handicapped parking and ease 2 of access for all abilities as well as architectural elements that create a warm welcome for all. The lease will cost $137,005 (excludes a two month rent reduction provided by landlord) during the first 12-month period and has a 3% escalation each year after. The landlord has agreed to provide a reduction in rent equal to the first two months' rent, $20,828, to be used for renovations. The total cost of renovations is $242,416 and will include significant updates to the interior and exterior of the facility. The Department of Social Services (DSS) has identified a new location within the Europa Center (100 Europa Drive) in Chapel Hill to house the Skills Development Center. Suite 101 within the Europa Center is a 10,650 square foot space that provides ample parking and a modern look that will provide a good space for working with local businesses. The lease is a 3-year term, with options for two additional one-year terms. The rent for the first 12 months will be $222,915, with a 3% escalation for each year thereafter. As the space is currently designed for offices, some renovations will be necessary to prepare the space for classrooms. The budget for the renovations is $254,953. Guardian ad Litem, which is part of the North Carolina Administrative Office of the Courts, may be re-located to the Europa Center or to another space. This decision will be based on input from the staff of Guardian ad Litem and DSS once the selected architectural firm has provided different options for design of the space. FINANCIAL IMPACT: The FY 2019-20 lease cost of $20,944 and renovations of $242,416 for 308 West Franklin Street will be funded through the Visitors Bureau Fund, outside of the General Fund. This Budget Amendment #4-C provides for a fund balance appropriation of $184,036 from the Visitors Bureau Fund to cover the lease cost and a portion of the renovations for FY 2019-20 at 308 West Franklin Street. The remaining portion of $79,324 needed for renovations will be debt financed and will be included in the upcoming Spring 2020 financing package. The Visitors Bureau will budget for the associated debt service beginning in FY 2020- 21. The reason for the debt financing amount is to adhere to the Visitors Bureau's fund balance policy of 15% policy of FY2019 expenditures, which equates to $311,735. The FY 2019-20 lease cost of $74,305 and renovations of $254,953 for the Europa Center will be funded through the General Fund. This Budget Amendment #4-C also provides for a fund balance appropriation of $74,305 from the General Fund for the lease cost for FY 2019-20 at the Europa Center. The renovations cost of $254,953 for the Europa Center will be debt financed, and will be included in the upcoming Spring 2020 financing package. It is anticipated that the lease and renovations costs associated directly with the Department of Social Services functions, currently estimated at 20% of the space, will receive 50% revenue reimbursement. Funds of $150,642 will be budgeted in the Visitors Bureau Fund for the lease cost in FY 2020- 21, and funds of $225,144 will be budgeted in the General Fund for the lease cost in FY 2020- 21, with the lease funds associated directly with Social Services functions receiving 50% revenue reimbursement. SOCIAL JUSTICE IMPACT: There is no Orange County Social Justice Goal impact associated with this item. ENVIRONMENTAL IMPACT: There is no Orange County Environmental Responsibility Goal impact associated with this item. 3 RECOMMENDATION(S): The Manager recommends that the Board authorize the Manager to sign the lease for 308 W. Franklin Street and the lease for Suite 101, Europa Center, upon final review by the County Attorney, and approve Budget Amendment #4-C. Attachment 1 4 (Amended Draft) LEASE AGREEMENT Between Charles J. Coates and Geraldine Dawson (Landlord) and Orange County, North Carolina (Tenant) THIS LEASE AND ITS CONTENTS ARE CONFIDENTIAL TABLE OF CONTENTS Page TABLE OF CONTENTS 1-2 LEASE PROVISIONS 3-4 LEASE AGREEMENT 5 1. PARTIES 5 2. PREMISES 5 3. REPAIRS AND POSSESSION 5 4. USE AND OPERATION 5 5. TERM 5 6. RENTAL 5 7. SECURITY DEPOSIT 6 8. UTILITIES 6 9. TAXES 6 10. REPAIRS AND MAINTENANCE 6 11. TENANT'S RIGHTS TO MAKE ALTERATIONS 7 12. AFFIRMATIVE COVENANTS OF TENANT 7 13. NEGATIVE COVENANTS OF TENANT 7 5 14. SIGNS 8 15. RIGHTS OF LANDLORD 8 16. CASUALTY INSURANCE AND DAMAGE TO PREMISES 8 17. INDEMNIFICATION AND PUBLIC LIABILITY INSURANCE 9 18. FIXTURES 10 19. ASSIGNING,MORTGAGING AND SUBLETTING 10 20. SUBORDINATION 10 21. REMEDIES CUMULATIVE 11 Initials 2 (308 W.Franklin St.) Landlord Tenant 6 22. SURRENDER AND HOLDING OVER 11 23. CONDEMNATION 11 24. NOTICES 11 25. SUCCESSORS 12 26. SCOPE AND INTERPRETATION OF THE AGREEMENT 12 27. FORCE MAJEURE 12 28. ESTOPPEL CERTIFICATES 12 29. DEFAULT OF TENANT AND REMEDIES 12 30. IDENTITY OF INTEREST 13 31. INVALIDITY OF PARTICULAR PROVISIONS 13 32. BROKER 13 33. CAPTIONS 13 34. TIME 14 35. MEMORANDUM OF LEASE 14 36. ENTIRE AGREEMENT 14 37. LEASE INURES TO THE BENEFIT OF THE ASSIGNEES 14 SIGNATURE PAGE 15 GUARANTY OF LEASE 16-17 Initials 3 (308 W.Franklin St.) Landlord Tenant 7 LEASE PROVISIONS 1. LANDLORD: Charles J. Coates and Geraldine Dawson 2. TENANT: Orange County,North Carolina 3. USE: Chapel Hill Orange County Visitors Bureau 4. AREA OF PREMISES: 308 W. Franklin St., Chapel Hill,North Carolina 27516, a lot of approximately 12,100 sq. ft., a building of approximately 4,008 sq. ft.,parking, and entrances. 5. NOTICE ADDRESS: Charles J. Coates, 5001 Cole Mill Road,Durham,NC 27705 6. LEASE TERM: 120 months 7. RENTABLE SQ.FT.: 4008 8. DELIVERY: '2020 9. LEASE EXECUTION DATE: , 2020 10. LEASE COMMENCEMENT: , 2020 11. LEASE EXPIRES: ,20 12. RENT COMMENCEMENT: ,2020 13. MONTHLY BASE RENT: Year one, , 2020— , 2021: $10,414; Year two, , 2021 — 2022: $10,726, Year three, $11,140, Year four, $11,380, Year Five, $11,721, Year Six: $12,073, Year Seven: $12,435, Year eight: $12,808, Year nine: $13,192, Year ten: $13,588. Yearly rent escalation of 3%/year 14. ANNUAL BASE RENT: Year one, ,2020— ,2021: $104,140 Year two, ,2021 — ,2022: $128,712 Year three, $132,576 Year four, $136,560 Year Five, $140,652 Year Six: $144,876 Year Seven: $149,220 Year eight: $153,696 Year nine: $158,304 Year ten: $163,056 15. RENT ESCALATION: Three percent (3%) increases at each Lease Anniversary date from Lease Execution Date ,2020. Initials 4 (308 W.Franklin St.) Landlord Tenant 8 16. IMPROVEMENTS BY TENANT AND RENT CONCESSION: Per aforementioned lease commencement date and rent commencement date, Landlord provides Tenant two (2) month's rent equal to $20,828 for building upfit. Rent Commencement date is two (2) months later than Lease Commencement date. Tenant agrees to complete the following building improvements to be completed by Tenant at Tenant's expense: A. Exterior repainting of wood trim B. Interior drywall repairs and repainting C. Interior floor refinishing or replacement D. _TBD by tenant E. 17. REAL ESTATE/PROPERTY TAXES: As part of the Lease Agreement, tenant shall pay the entire Orange County Property Tax and Fee Bill for the Demised Premises directly to Orange County, for each and every year of the Lease. Landlord will provide Tenant a copy of the Orange County Property Tax and Fee Bill yearly, as soon as it is received by Landlord (typically in August). Tenant shall provide confirmation of receipt of said Bill and confirmation that said Bill has been paid before the Past Due Date (currently January 6th yearly). 18. BUILDING MAINTENANCE, UTILITIES, AND INSURANCE: Tenant will be responsible for maintenance,utilities, and insurance of the leased Demised Premised per Lease Agreement 19. SECURITY DEPOSIT: Tenant shall provide the Landlord a security deposit equal to one(1)month's rent$10,414 within five days of lease execution. 20. PAYMENTS: All payments from Tenant to Landlord shall be wire transferred into Landlord's account: FRB ABA 053000196 wire 026009593 Bank of America For credit to: Account: xxxxx744 In favor of: Account#xxxxxxx744 for: Charles J. Coates 5001 Cole Mill Road Durham,NC 27705 21. ALL RENTS ARE DUE ON THE 11 DAY OF EACH MONTH: Any payment not received by the 10`h of the month will incur an automatic late fee of six (6%) percent of the monthly rental rate, to be paid immediately following late rent payment. Initials 5 (308 W.Franklin St.) Landlord Tenant 9 LEASE AGREEMENT PARTIES 1. THIS LEASE AGREEMENT made and entered into on , 2020 by and between Charles J. Coates and Geraldine Dawson, 5001 Cole Mill Road, NC 27705 (hereinafter referred to as Landlord) and Orange County,North Carolina(hereinafter referred to as"Tenant") PREMISES 2. Landlord leases to Tenant, and Tenant leases from Landlord under the terms and conditions set forth in this Lease Agreement, certain premises consisting of a lot of approximately 12,100 square feet including a building of approximately 4008 square feet with adjoining parking lot and entrances (hereinafter referred to as "Demised Premises") in Chapel Hill, State of North Carolina, as described legally as Tract 704410, Map 7.85.M.23, Chapel Hill, Orange County,NC, located at 308 W. Franklin St., Chapel Hill,NC 27516. REPAIRS AND POSSESSION 3. Landlord warrants that it is the Owner of the tract of land described in Premises (a.) Tenant herein agrees to hold Landlord harmless for any outstanding bills or invoices that might occur pursuant to Tenant's repair, upfit or improvement of said Demised Premises. Further, Tenant shall not allow any outstanding bills incurred for labor employed by Tenant and/or materials used for said upfit of Demised Premises to remain unpaid. Tenant will hold Landlord harmless for any loss, cost, damage and/or expense of every kind, including any resulting attorney's fees, directly or indirectly incurred as a result or on the account of any materialman's lien or claim of lien that might be placed on the Demised Premises as a result of Tenant's improvements, repairs or upfit. Rent shall commence as of , 2020 (hereinafter called "Rental Commencement Date") regardless of whether Tenant has opened for business. (b.) Tenant shall pay all of the utility charges for the Demised Premises after delivery of possession thereof by Landlord. Tenant agrees to submit to Landlord plans and specifications covering all improvements or upfit which Tenant proposes to do in the Demised Premises. Such plans and specifications shall be prepared in such detail as Landlord may require, and Tenant agrees not to commence work upon any of the aforesaid Tenant's work until Landlord has approved such plans and specifications in writing. Landlord agrees to act with reasonable promptness with respect to such plans and specifications. (c) By occupying the Demised Premises after the delivery of possession, to perform improvement or upfit work or for any other purpose, Tenant shall be deemed to have accepted the same and to have acknowledged that the Demised Premises are in the condition required by this Lease Agreement. (d) If Tenant desires to change the wiring for telegraphic, telephonic, telecommunication,burglar alarm or signal service within the Demised Premises, Tenant agrees to submit to Landlord plans and specifications describing where and how connections for said wiring for such services shall be introduced and run. Such plans and specifications shall be prepared in such detail as Landlord may require, and Tenant agrees not to commence work upon any of the aforesaid Tenant's work until Landlord has approved such plans and specifications in writing. Without such approval, no boring, cutting or installation of wires or cables is permitted. Landlord agrees to act with reasonable promptness with respect to such plans and specifications. (e) The Tenant shall be responsible for the locking of doors in and to the Demised Premises. Any damage resulting from neglect of this clause shall be paid by Tenant. USE AND OPERATION Initials 6 (308 W.Franklin St.) Landlord Tenant 10 4. (a) Tenant shall use and occupy the Demised Premises solely for the purpose as the Chapel Hill Orange County Visitors Bureau (b) Tenant agrees that the Demised Premises shall not be used, assigned or subleased for any illegal use. (c) Tenant shall not do or permit to be done in the Leased Demised Premises or Site, or bring or keep anything into the Leased Demised Premises or Site, which shall in any way increase the rate of fire insurance on the Building,or on the property kept in the Building. (d) Tenant shall not, keep, use, store, or dispose of, substances designated as or containing components designated as hazardous, dangerous, toxic or harmful and/or subject to regulation under any federal, state or local law,regulation or ordinance, on or around the Leased Demised Premises. TERM 5. The initial term of this Lease Agreement shall commence on ,2020 and expire on ,20_ RENTAL 6. (a) During the term of this Lease, Tenant covenants and agrees to pay to Landlord the monthly rental amounts shown in Lease Provisions. (In consideration of the Tenant completing the noted repairs / improvements to the property, the Tenant will pay no rent for the first two (2) months). Said monthly installments are to be paid in advance on the first day of each and every calendar month. Any payment not received by the 10t'of the month will incur an automatic late fee of six(6)percent. (i) The term"lease year" as used in this lease, refers to the period from the Lease Commencement Date to the same next succeeding date, both dates inclusive, to each successive twelve (12) month period thereafter throughout the Lease Term. (b) Time and Place of Payment: Tenant will make all payments, including rent, taxes, and damage deposit by wire transfer to: ABA 053000196, wire 026009593, Bank of America, For credit to: Account: xxxxxxxx744, Bank of America, Incoming Wire Account, In favor of: Account xxxxxxxxx744 in favor of Charles J. Coates, 5001 Cole Mill Road,NC 27705, or to such other person or corporation and at such other place as shall be designated by Landlord in writing at least ten (10) days prior to the next ensuing payment date. SECURITY DEPOSIT 7. Tenant shall provide the Landlord a security deposit equal to one (1) month's rent upon lease execution. Landlord shall acknowledge receipt from tenant of this sum of $10,414, which sum Landlord shall retain as security for the performance by tenant of each of its obligations under this lease. It is mutually agreed Tenant shall receive no interest related to said security deposit. If Tenant fails, at any time, to perform its obligations, landlord may, at its option, apply said deposit, or so much thereof as is required, to cure tenant's default; but if at any time prior to the termination of this lease Landlord depletes the deposit, in whole or in part, Tenant shall immediately restore the amount so used by Landlord. Unless Landlord uses the deposit to cure a default of Tenant, or to restore the leased Demised Premises to the condition that Tenant is required to leave them at the conclusion of the term, Landlord shall within thirty(30)days of the termination of the Lease refund so much of the deposit as it continues to hold to Tenant. UTILITIES 8. During the term of this Lease Agreement, the Tenant shall pay for all electricity, gas, heat, air conditioning, water, sewer,janitor service, garbage disposal and other utilities or services required by it in the use of the Demised Premises. Landlord shall have no liability for failure to provide such electricity, gas,heat, air conditioning,water, sewer or other utilities or services. TAXES 9. (a) As part of the Lease Agreement, tenant shall pay the entire Orange County Property Tax and Fee Bill for the Demised Premises directly to Orange County, for each and every year of the Lease. Initials 7 (308 W.Franklin St.) Landlord Tenant 11 Landlord will provide Tenant a copy of the Orange County Property Tax and Fee Bill yearly, as soon as it is received by Landlord (typically in August). Tenant shall provide written confirmation of receipt of said Bill and written confirmation that said Bill has been paid before the Past Due Date (currently January 6th yearly). (b) Additionally, Tenant shall pay when due all taxes and assessments of any kind or nature which may hereafter be imposed upon the Demised Premises; and the Tenant shall pay when due all taxes and assessments of any kind or nature imposed or assessed upon fixtures, equipment, merchandise or other property installed in or brought onto the Demised Premises by or for Tenant. In the event that any tax or assessment other than Orange County Property Tax and Fee is ever levied against the Premises, the payment of said additional tax assessments shall be the sole responsibility of the tenant. The Tenant shall pay the same within thirty (30) days following its receipt of the Landlord's statement of the amount due as additional tax or assessment(and before any fine,penalty, interest or costs may be added thereto for the non-payment thereof). Tenant shall pay any tax that may be levied, assessed or imposed upon the rent reserved hereunder by any governmental authority acting under any present or future law. REPAIRS AND MAINTENANCE: 10. (a) Landlord will keep the roof and the structural portions of the Demised Premises, excepting any work done by Tenant and any glass of doors and windows, in proper repair, provided that in each case Tenant shall have given Landlord prior written notice of the necessity of such repairs; and provided further that if any such repair is required by reason of Tenant's negligence or the negligence of any of its agents, employees or customers, or other persons using the Demised Premises with Tenant's consent, express or implied, Landlord may make such repair and add the cost thereof to the first installment of rent which shall thereafter become due. Tenant is responsible for breakage and/or damage to storefront glass and storefront doors. Except as otherwise provided in this Article, Tenant will keep the Demised Premises, which includes, but is not limited to, all electrical, plumbing, kitchen and other mechanical installations, all furniture, all doors, and all plate glass including door and window glass in good order, accomplishing any and all repairs, alterations, replacements and modifications at its own expense and using materials and labor of kind and quality equal to the original work, and will surrender Demised Premises at the expiration or earlier termination of this Lease Agreement in as good condition as existing on Lease Commencement day, excepting only deterioration caused by ordinary wear and tear. (b) If Tenant refuses or neglects to repair property as required hereunder and to the reasonable satisfaction of Landlord as soon as reasonably possible after written demand, Landlord may, but is not required to, make such repairs without liability to Tenant for any loss or damage that may occur to Tenant's merchandise, fixtures or other property or to Tenant's business by reason thereof, and upon completion thereof Tenant shall pay Landlord's costs for making such repairs as additional rent. If Tenant does not pay such costs of repairs, Landlord shall also have, in addition to any other remedies, the remedies of termination of the Lease upon written notice to the Tenant and of repossession of the Demised Premises. (c) Tenant shall maintain the exterior of the Demised Premises including exterior of the building, exterior storage areas, rear wash-down area, landscaped areas and parking areas in a clean, functioning, and presentable condition. Any replacement of landscape or repairs to structures or items on the premises are to be at Tenants expense. TENANT'S RIGHTS TO MAKE ALTERATIONS 11. Tenant will not make any alterations, improvements or additions to the Demised Premises of a structural nature without first obtaining the written consent of Landlord. All alterations, improvements and additions made by Tenant shall remain upon the Demised Premises at the expiration or earlier termination of this Lease Agreement and shall become the property of Landlord,unless Landlord shall, prior to the termination of this Lease Agreement, have given written notice to Tenant to remove same, Initials 8 (308 W.Franklin St.) Landlord Tenant 12 in which event Tenant shall remove such alterations, improvements and additions and restore the premise to the same good order and condition in which they were at the commencement of this Lease. Should Tenant fail so to do, Landlord may do so, collecting the cost and expense thereof from Tenant as additional rent. AFFIRMATIVE COVENANTS OF TENANT 12. Tenant covenants and agrees: (a) To comply with any and all requirements of any of the constituted public authorities, and with the terms of any State or Federal statute or public authorities, and with the terms of any State or Federal statute or local ordinance or regulation applicable to Tenant or its use of the Demised Premises and save Landlord harmless from penalties, fines, costs, expenses or damages resulting from failure to do so. (b) To give to Landlord prompt written notice of any accident, fire or damage occurring in or to the Demised Premises and the common area. (c) To keep the Demised Premises sufficiently heated to prevent freezing of water in pipes and fixtures. (e) To conduct its business in the Demised Premises in all respects in a diligent and dignified manner and keep the Demised Premises in first class condition in accordance with high standards (f) To do all things necessary to prevent the filing of any mechanics' or other liens against the Demised Premises or any part thereof by reason of work, labor, services or materials supplied or claimed to have been supplied to Tenant, or anyone holding the Demised Premises or any part thereof, through or under Tenant. If any such lien shall at any time be filed against Tenant's interest in the Demised Premises, Tenant shall either cause the same to be discharged of record within twenty(20) days after the date of filing of the same, or, if Tenant, in Tenant's discretion and in good faith, determines that such lien should be contested, shall furnish such security as may be necessary or required to prevent any foreclosure proceedings against Tenant's interest in the Demised Premises during the pendency of such contest. If Tenant shall fail to discharge such lien within such period or fail to furnish such security, then, in addition to any other right or remedy of Landlord resulting form Tenant's said default, Landlord may, but shall not be obligated to, discharge the same either by paying the amount claimed to be due or by procuring the discharge of such lien by giving security or in such other manner as is, or may be, prescribed by law. Nothing contained herein shall imply any consent or agreement on the part of Landlord to subject Landlord's estate to liability under any mechanics' or other lien of law. (h) To repay to Landlord as additional rental, on demand, all sums disbursed or deposited by Landlord pursuant to the foregoing provisions of this Article, including Landlord's costs, expenses and reasonable attorneys' fees incurred by Landlord in connection therewith, together with interest thereon at the maximum rate allowed by law. NEGATIVE COVENANTS OF TENANT 13. Tenant will not do any of the following without prior consent in writing of Landlord: (a) Do or suffer to be done, any act, matter or thing objectionable to insurance companies whereby the fire insurance or any other insurance now in force or hereafter to be placed on the Demised Premises or any part thereof, or on the building of which the Demised Premises may be a part, shall become void or suspended, or whereby the same shall be rated as a more hazardous risk than at the date when Tenant receives possession hereunder. In case of a breach of this covenant, in addition to all other remedies of Landlord hereunder, Tenant agrees to pay to Landlord as additional rent, any and all increase or increases of premiums on insurance, including rent insurance carried by Landlord on any part of the Demised Premises, caused in any way by the occupancy of Tenant. In determining whether increased premiums are the result of Tenant's use of premises, a schedule issued by the organization making the insurance rate on the Demised Premises, showing the various Initials 9 (308 W.Franklin St.) Landlord Tenant 13 components of such rate, shall be conclusive evidence of the several items and charges which make up the insurance rate on the premises. (b) Commit or suffer to be committed by any person any waste upon the Demised Premises or any nuisance or other act or thing which may disturb the quiet enjoyment of any person within five hundred(500) feet of the boundaries of the Demised Premises. SIGNS 14. (a) Tenant shall not decorate,paint or in any manner alter the exterior of the Demised Premises, or any part thereof, except in accordance with its duties pursuant to Article 12 hereof, and shall not install or affix any sign, device, fixture or attachment on or to the exterior of the Demised Premises, or within the boundaries of the Demised Premises, without first obtaining Landlord's written consent. If Tenant shall do any of the foregoing acts in contravention of this provision, Landlord shall have the right to remove any such decoration, paint, alteration, sign, device, fixture or attachment and restore the Demised Premises to the condition thereof prior to such act, and the cost of such removal and restoration shall be paid by Tenant as additional rental on the first day of the month next following such removal or restoration. (b) Tenant, at its expense, shall furnish and install at an appropriate location on the exterior of said premises an identification sign of such design, content, form, size and material as it may select for the purpose of designating the business conducted therefrom as that of Tenant's, such sign to be approved by Landlord or Landlord's architect in writing. Sign must be approved by Town of Chapel per their sign ordinance. RIGHTS OF LANDLORD 15. Landlord reserves in addition to, and not in substitution for other rights reserved herein, the following rights with respect to the Demised Premises: (a) At all reasonable times, by itself or its duly authorized agents, to go upon and inspect the Demised Premises and every part thereof, and at its option to make repairs, alterations and additions to the Demised Premises or the building of which the Demised Premises are a part. If tenant shall not be personally present to open and permit an entry by Landlord into the Demised Premises, at any time, and for any reason an entry thereof shall be necessary in the sole discretion of Landlord,Landlord or Landlord's agents may enter the same without rendering Landlord or such agents liable therefore. (b) To display a "For Sale" sign at any time, and also, after notice from either party of intention to terminate this Lease Agreement or at any time within one (1) year prior to the expiration of this Lease Agreement, to display a"For Rent" sign, or both "For Rent" and"For Sale" signs, and all of said signs shall be placed upon said part of the Demised Premises as Landlord shall require, except on display windows or door or doors leading into the Demised Premises. Prospective purchasers or tenants authorized by Landlord may inspect the Demised Premises at reasonable hours. The exercise of any right reserved to Landlord in this Article, or otherwise, shall never be deemed an eviction or disturbance of Tenant's use and possession of the Demised Premises and shall never render Landlord liable in any manner to Tenant or to any other person. CASUALTY INSURANCE AND DAMAGE TO PREMISES 16. (a) Tenant will maintain All Risk fire insurance to include loss of rents of the Demised Premises, with Landlord specifically listed as co-insured. If the Demised Premises shall be damaged by fire or other casualty of the kind insured against in All Risk policies of fire insurance but are not thereby rendered untenantable in whole or in part, Tenant shall promptly, at its own expense and to the extent required by its original obligation to build, cause such damage to be repaired, and the rent shall not be abated. If by reason of such occurrence,the Demised Premises shall be rendered untenantable only in part, Tenant Initials 10 (308 W.Franklin St.) Landlord Tenant 14 shall promptly at its own expense cause the damage to be repaired to the extent required by its original obligations to build, and the minimum rent meanwhile shall be abated proportionately as to the portion of the Demised Premises rendered untenantable. If the Demised Premises shall be rendered wholly untenantable by reason of such occurrence, the Tenant shall promptly at its own expense cause such damage to be repaired to the extent provided, however, that there shall be no extension of the term of this Lease Agreement by reason of such abatement; and provided further, however, that if after the beginning of the last two (2) years of the term of this Lease Agreement, the Demised Premises shall be destroyed or damaged to the extent of fifty percent (50%) or more of their replacement value above foundation walls or rendered wholly untenantable, Landlord may terminate this Lease Agreement by notice to Tenant, said notice to be given within thirty (30) days of the event rendering the Demised Premises damaged or wholly untenantable, provided that such termination shall not affect any rights theretofore accrued to Landlord hereunder because of prior defaults of Tenant. Except as herein provided,there shall be no obligation to repair or rebuild in case of fire or other casualty. (b) Tenant will maintain, at its expense, All Risk and Loss of Rents insurance on the Tenant's inventory, trade fixtures, furniture, furnishing, special equipment, floor and wall coverings, plate glass windows and doors, and all other items of personal property of Tenant located on or within the Demised Premises and improvements and betterments made by Tenant to the Demised Premises, such coverage to be in an amount equal to the replacement cost thereof. (c) Tenant shall not occupy Demised Premises until aforementioned All Risk and Loss of Rents Insurance policy is in full effect. Tenant to provide to Landlord a copy of the paid insurance policy as soon as it is received by Tenant. If Landlord is required to repair the Demised Premises as herein provided, Tenant shall repair or replace its inventory, trade fixtures, furniture, furnishings, floor and wall coverings, plate glass windows and doors, special equipment and other items of construction and personal property of Tenant necessary for the operation of business in accordance with the terms and conditions of this Lease Agreement. (d) Tenant agrees that it will not keep, use, sell or offer for sale in or upon the Demised Premises any article which may be prohibited by the All Risk form of fire insurance policy. Tenant agrees to pay any increase in premiums for All Risk Fire and Loss of Rents and liability insurance with all its endorsements that may be charged during the term of this lease on the amount of such insurance which may be carried by Landlord on said Demised Premises or the building of which they are a part, resulting from the type of business conducted by Tenant in the Demised Premises, whether or not Landlord has consented to the same, and increases in insurance rates and/or valuation. In determining whether increased premiums are the result of Tenant's use of the Demised Premises, a schedule, issued by the organization making the insurance rate on the Demised Premises, showing the various components of such rate, shall be conclusive evidence of the several items and charges which make up the fire insurance rate on the Demised Premises. In the event Tenant's occupancy causes any increase in premium for the fire and/or casualty rates on the leased Demised Premises, or any part thereof above the rate for the least hazardous type of occupancy legally permitted in the leased Demised Premises, the Tenant shall pay the additional premium on the fire and/or casualty and liability insurance policies by reason thereof. The Tenant shall also pay in such event, any additional premium on the rent loss through fire. Bills for such additional premiums shall be rendered by Landlord to Tenant at such times as Landlord may elect, and shall be due from, and payable by Tenant when rendered, and the amount thereof shall be deemed to be, and be paid as additional rent. Initials 11 (308 W.Franklin St.) Landlord Tenant 15 (e) Landlord shall not be liable for any damage done or occasioned by or from the electrical system, the heating or cooling system, the plumbing and sewer systems; nor for damage occasioned by water, snow or ice being upon or coming through the roof, walls, windows, doors, or otherwise, in, upon or about the Demised Premises, and furthermore, Landlord shall not be liable for any damage occasioned by reason of the construction on the Demised Premises or for the failure to keep the Demised Premises in repair, unless Landlord is obligated to make such repairs under the terms of the Lease Agreement, and unless notice of the need for such repairs has been given to Landlord, a reasonable time has elapsed and Landlord has failed to make such repairs. In any event, Landlord shall not be liable for any damage to Tenant's inventory, trade fixtures, furniture, furnishings, floor and wall coverings,plate glass windows and doors, special equipment and all other kinds of personal property of Tenant from fire or other hazards, regardless of the cause thereof, and Tenant hereby releases Landlord from all liability for such damage. INDEMNIFICATION AND PUBLIC LIABILITY INSURANCE 17. (a) To the extent authorized by North Carolina law Tenant will indemnify Landlord and save it harmless from and against any and all claims, actions, damages, liability and expense in connection with loss of life, personal injury or damage to property occurring in or about, or arising out of, the Demised Premises and adjacent sidewalks and loading areas, or occasioned wholly or in part by any act or omission of Tenant, its agents, subtenants, licensees, concessionaires, contractors, customers or employees. In case Landlord shall be made a party to any litigation, commenced by or against Tenant, its agents, subtenants, licensees, concessionaires, contractors, customers of employees then Tenant, to the extent authorized by North Carolina law, shall protect and hold Landlord harmless and shall pay all costs, expenses and reasonable attorney's fees and paralegal fees incurred or paid by the Landlord in connection with such litigation and all costs, expenses and reasonable attorney's fees and paralegal fees incurred or paid by Landlord in enforcing the covenants, conditions and agreements of this Lease Agreement whether incurred as a result of litigation or otherwise. (b) Tenant shall, at all times during the term hereof, keep in force at its own expense and naming as insured both Landlord and Tenant public liability insurance with minimum limits of ONE MILLION DOLLARS ($1,000,000.00) per claim, and TWO MILLION DOLLARS ($2,000,000.00) aggregate claim for bodily injuries and property damage,with Landlord specifically listed as co-insured. Landlord and Tenant agree that if the Demised Premises or its contents are damaged or destroyed by fire or other insured casualty, the rights, if any, of either party against the other with respect to such damage or destruction are waived. All policies hereunder shall provide for waiver of subrogation and shall contain an endorsement providing that the insurer will not cancel or materially change the coverage of said policy or policies without first giving thirty (30) days prior written notice thereof to Landlord. Tenant shall not occupy Demised Premises until aforementioned liability insurance policy is in full effect. FIXTURES 18. All fixtures installed by Tenant in the Demised Premises shall remain the property of Tenant and shall be removable at the expiration or earlier termination of this Lease Agreement or any renewal or extension thereof, provided Tenant shall not at such time be in default under this Lease Agreement; provided further, that in the event of such removal,having repaired the damage caused by such removal Tenant shall promptly restore the Demised Premises to their original order and condition. Any such fixtures not removed at or prior to such termination shall be and become the property of Landlord. Lighting fixtures and heating, ventilating, and air conditioning equipment, whether or not installed by Tenant, shall not be removable at the expiration or earlier termination of this Lease Agreement, or at the expiration of any renewal or extension thereof, and shall become the property of Landlord. Initials 12 (308 W.Franklin St.) Landlord Tenant 16 ASSIGNING,MORTGAGING AND SUBLETTING 19. Tenant agrees not to assign, mortgage,pledge or encumber this Lease Agreement in whole or in part, or sublet the whole or any part of the Demised Premises without first obtaining the written consent of Landlord. Tenant agrees that in the event of any such assignment or subletting made with the written consent of Landlord as aforesaid, Tenant will nevertheless remain primarily liable for the performance of all the terms, conditions and covenants of this Lease Agreement. Upon written consent, the assignment of the subletting of the Demised Premises of this Lease Agreement,it will be upon condition that: (a) Any such assignee or sublessee shall agree with Landlord in writing, prior to any such assignment or subletting, to be bound by and to perform all covenants, conditions and agreements of this Lease Agreement applicable to Tenant. (b) Tenant shall remain primarily liable for the observance and performance of all of the covenants, conditions and agreements of this Lease Agreement. (c) Landlord may exercise against any subtenant or assignee all the rights and remedies herein provided upon default, but Tenant shall remain liable, jointly and severally, with any assignee or subtenant for the performance of all of the covenants, conditions and agreements of this Lease Agreement, including, but not being limited to, the payment to Landlord of all payments due or to become due to Landlord under this Lease Agreement. SUBORDINATION 20. (a) Tenant agrees to subordinate this Lease Agreement to any and all mortgages or deeds of trust now or hereafter placed on the property of which the Demised Premises are a part, provided in each such case the holder of any such mortgage or deed of trust shall agree in writing that this Lease Agreement shall not be divested or in any way affected by foreclosure or other default proceedings under said mortgage, deed of trust, or obligation secured thereby, so long as Tenant shall not be in default under the terms of this Lease Agreement; and Tenant further agrees that this Lease Agreement shall remain in full force and effect notwithstanding any such default proceedings under said mortgage, deed of trust or obligation secured thereby. (b) If Tenant is notified of Landlord's assignment of this Lease as security for a mortgage loan and of the name and address of the older of such mortgage or deed of trust, Tenant shall not terminate or cancel this Lease for any default on the part of Landlord without first: (1) Giving notice of its intention to do so to the holder of such mortgage or deed of trust,the notice to describe in reasonable detail the nature and extent of the default; and, (2) Affording the holder of such mortgage or deed of trust a reasonable opportunity to perform on behalf of Landlord its obligation under this Lease. (c) Recognizing that both parties may find it necessary to establish to third parties, such as accountants, banks, mortgagees or the like, the then current status of performance hereunder, either party, on the written request of one to the other made from time to time, will promptly furnish a written statement on the status of any matter pertaining to this Lease, including a copy of Tenant's latest financial statement. (d) Without limiting the generality of the foregoing, Tenant specifically agrees, promptly upon the commencement of the term hereof, to notify the Landlord in writing of the date of the commencement of the terms and to acknowledge satisfaction of the requirements with respect to all matters by Landlord, save and except for such matters as Tenant may wish to set forth specifically in said statement. At any time within ten (10) days after such request is made, Tenant shall execute, acknowledge and deliver to Landlord a certificate evidencing: (1) Whether this Lease is in full force and effect; (2) Whether this Lease has been amended in any way; (3) Whether there are any existing defaults, defenses or off-sets hereunder to the knowledge of Tenant and specifying the nature of such details, if any; and, Initials 13 (308 W.Franklin St.) Landlord Tenant 17 (4) The date to which rent has been paid. REMEDIES CUMULATIVE 21. No remedy herein or other conferred upon or reserved to Landlord or Tenant shall be considered exclusive of any other remedy, but the same shall be distinct, separate and cumulative and shall be in addition to every other remedy given hereunder, or now or hereafter existing at law or in equity or by statute; and every power and remedy given by this Lease to Landlord or Tenant may be exercised from time to time as often as occasion may arise, or as may be deemed expedient. No delay or omission of Landlord or Tenant to exercise any right or power arising from any default on the part of the other hall impair any such right or power, or shall be construed to be a waiver of any such default or any acquiescence therein. SURRENDER AND HOLDING OVER 22. Tenant, upon expiration or termination of this Lease Agreement, either by lapse of time or otherwise, agrees peaceably to surrender to Landlord the Demised Premises in broom-clean condition and in good repair as required by Article 11 hereof. In the event Tenant shall fail to surrender the Demised Premises upon demand, Landlord, in addition to all other remedies available to it hereunder, shall have the right to receive, as liquidated damages for all the time Tenant shall so retain possession of the Demised Premises, or any part thereof, an amount equal to twice the rental rate specified in Article 6 (or Article 8 if after a renewal term)of this Lease Agreement, as applied to such period. If Tenant remains in possession of the Demised Premises with Landlord's consent but without a new lease reduced to writing and duly executed, Tenant shall be deemed to be occupying the Demised Premises as a tenant from month-to-month only, but otherwise subject to all the covenants, conditions and agreements of this Lease Agreement. CONDEMNATION 23.(a) If more than twenty percent(20%) of the floor area of the Demised Premises is taken for any public or quasi-public use under any governmental law, ordinance or regulation or by right of eminent domain or by private purchase in lieu thereof, then either party hereto shall have the right to terminate this Lease Agreement effective on the date physical possession is taken by the condemning authority. (b) If any portion of the Demised Premises is taken for any public or quasi-public use under any governmental law, ordinance or regulation, or by right of eminent domain,or by private purchase in lieu thereof, and this Lease Agreement shall not be terminated, the entire rental specified in Article 6 (or Article 7 if during the renewal term) shall be reduced during the unexpired portion of this Lease Agreement (or extension thereof) in proportion to the area taken, effective on the date physical possession is taken by the condemning authority. (c) If any part of the parking areas, driveways, and walkways taken for any public or quasi-public use under any governmental law, ordinance or regulation, or by right of eminent domain, or by private purchase in lieu thereof, this lease shall not terminate, nor shall the rent payable hereunder be reduced, nor shall Tenant be entitled to any part of the award made for such taken; except that either Landlord or Tenant may terminate this lease if the number of square feet of parking areas, driveways and walkways after such taking plus any additional parking area provided by Landlord in reasonable proximity to the Demised Premises shall be less than seventy percent (70%) of the number of square feet in the parking areas, driveways and walkways before such taking. (d) Any election to terminate this lease following condemnation shall be evidenced only by written notice of termination delivered to the other party within thirty (30) days after the date on which physical possession is taken by the condemning authority. Initials 14 (308 W.Franklin St.) Landlord Tenant 18 (e) If this lease is not terminated following a partial condemnation, Landlord shall make all necessary repairs or alterations within the scope of Landlord's original obligation to build necessary to make the Demised Premises architecturally whole. (f) All compensation awarded for any taking (or the proceeds of private sale in lieu thereof) whether for the whole or a part of the Demised Premises, shall be the property of Landlord, whether such award is compensation for damages to Landlord's or Tenant's interest in any such award to Landlord; provided, however, Landlord shall have no interest in any award made to Tenant for loss of business or for the taking of Tenant's fixtures and other property within the Demised Premises if a separate award for such items is made to Tenant. NOTICES 24. Wherever in this Lease Agreement it shall be required or permitted that notice or demand be given or served by either party to this Lease Agreement to or on the other, such notice or demand shall be deemed to have been duly given or served when sent in writing by registered or certified mail, postage prepaid, to the respective addresses as hereinafter set forth. Such addresses may be changed from time to time by either party by serving notice as above provided: TO LANDLORD: Charles J. Coates 5001 Cole Mill Road Durham,NC 27705 TO TENANT: Orange County,North Carolina SUCCESSORS 25. All rights, obligations and liabilities herein given to, or imposed upon the respective parties hereto shall extend to and bind the several and respective heirs, executors, administrators, successors, subleasees, licensees, concessionaires and assigns of said parties subject to the provisions of Article 21 providing for subordination, and except as expressly provided in this Article; and if there shall be more than one Tenant they shall all be bound jointly and severally by the terms, covenants, conditions and agreements herein and the word "Tenant" shall be deemed and taken to mean each and every person or party mentioned as a Tenant herein, be the same one or more; and if there shall be more than one tenant any notice required or permitted by the terms of this Lease Agreement may be given by or to any one thereof. No right,however, shall inure to the benefit of any assignee of Tenant unless the assignment to such assignee has been approved by Landlord in writing as aforesaid. The use of the neuter singular pronoun to refer to Landlord or Tenant may be individual, a partnership, a corporation or a group of two or more individuals or corporations. The necessary grammatical changes required to make the provision of this Lease Agreement apply in the plural sense where there is more than one Landlord or tenant and to either corporations, associates, partnerships, or individuals, males or females, shall in all instances be assumed as though in each case fully expressed. The term "Landlord" as used in this Lease Agreement so far as covenants, conditions and agreements on the part of the said Landlord are concerned shall be limited to mean Charles J. Coates and Geraldine Dawson Coates, their successors and assigns. In the event of any transfer or transfers of the title to the Demised Premises, the said Landlord (and in case of any subsequent transfers or conveyance, the then grantor) shall be automatically freed and relieved from and after the date of such transfer or conveyance of all liability as respects the performance of any covenants, conditions and agreements on the part of said Landlord contained in this Lease Agreement, thereafter to be performed; provided that any amount then due and payable to Tenant by Landlord, or the then grantor, under any provisions of this Lease Agreement, shall be paid to Tenant. It is intended hereby that the covenants, conditions and agreements contained in this Lease Agreement on the part of the Landlord shall, subject as aforesaid,be binding on Initials 15 (308 W.Franklin St.) Landlord Tenant 19 Landlord, its successors and assigns, only during and in respect of their respective successive period of ownership. Further, Landlord's liability under the Lease Agreement shall be limited to and include only the interests of Landlord in the real estate comprising the Demised Premises. SCOPE AND INTERPRETATION OF THE AGREEMENT 26. This Lease Agreement shall be considered to be the only agreement between the parties hereto pertaining to the Demised Premises. All negotiations and oral agreements acceptable to both parties are included herein. The laws of the State of North Carolina shall govern the validity, interpretation, performance and enforcement of this Lease Agreement. FORCE MAJEURE 27. In the event Landlord or Tenant shall be delayed, hindered or prevented from the performance of any act required hereunder, by reason of war, civil commotion, acts of God, governmental restrictions, scarcity of labor or materials, strikes, labor walkouts, or any other reasons beyond its control, the performance of such act shall be excused for the period of delay, and the period of the performance of any such act shall be extended for the period necessary to complete performance after the end of the period of such delay. ESTOPPEL CERTIFICATES: 28. Tenant shall execute and deliver to Landlord, upon its occupancy of the Demised Premises, a certificate/statement provided by Landlord, certifying that this Lease is unmodified and in full force and effect, and other factual data relating to the Lease or the Demised Premises which Landlord may reasonably request ("Estoppel"). Furthermore, Tenant may be required, from time to time during the term of the Lease, to execute and deliver to Landlord an Estoppel for purposes of refinancing, syndication, sale of property, etc. In such event, Tenant shall have ten(10) days from its receipt thereof from Landlord to execute and deliver such fully executed Estoppel to Landlord. Tenant's failure to execute said certificate shall constitute a default hereunder. DEFAULT OF TENANT AND REMEDIES 29. (a) If Tenant shall hold over possession of the leasehold Demised Premises after the term has expired or if Tenant shall fail to pay in full any rental or other sum of money due hereunder, as due on the first day of the month, and shall continue in default in that payment of holding over for a period of ten (10) days,then on or after the 15t'day of that month the Landlord may at its option notify Tenant by letter of Tenant's continuing default and that unless the overdue payment is received or the Tenant ceases to hold over, that Landlord will begin eviction proceedings. The Landlord may also, at its option, declare the lease terminated and demand that the Tenant vacate the Demised Premises. Thereafter, on or after the thirtieth(30`h) day of that month,the Landlord may, at its option, sue Tenant for summary ejectment and for all past due rent and other sums due. (b) If Tenant shall default in the performance of any other of the terms, conditions or covenants contained in this Lease to be observed or performed by it and does not remedy such default within thirty(30) days after written notice thereof or does not within such thirty(30) days commence such act or acts as shall be necessary to remedy the default and shall not complete such act or acts promptly, or if Tenant shall become bankrupt or insolvent, or file any debtor proceedings, or file in any Court pursuant to any statute, either of the United States or of any State, a petition in bankruptcy or insolvency or for reorganization, or file or have filed against it a Petition for the appointment of receiver or trustee for all or substantially all of the assets of Tenant or such appointment shall not be vacated or set aside within thirty (30) days from such appointment, or if Tenant makes an assignment for the benefit of creditors, or petitions for or agrees to an arrangement, or suffers the lease to be taken under any writ of execution and such writ is not discharged or set aside within thirty (30) days, then in Initials 16 (308 W.Franklin St.) Landlord Tenant 20 any such event Landlord shall have the right at its option to terminate and cancel this Lease Agreement or to peaceably re-enter. If Landlord should elect to re-enter as herein provided, or should it take possession pursuant to legal proceedings, it may either terminate this Agreement make such alterations and repairs as are necessary in order to relet the Demised Premises, and relet the Demised Premises for such term and at such rents and upon such other terms and conditions as Landlord may deem advisable. In the event of such reletting, all rentals received by Landlord shall be applied, first, to the payment of any indebtedness other than rental due hereunder from Tenant to Landlord; second, to the payment of any costs and expenses of such reletting, including the expense of alterations and repairs; third, to the payment of rental due and unpaid hereunder, and the residue, if any, shall be held by Landlord and applied in the payment of future rental due and unpaid hereunder. If such reletting shall yield rentals insufficient for any month to pay the rental due by the Tenant hereunder for that month, Tenant shall be liable to Landlord for the deficiency and same shall be paid monthly. No such re-entry or taking possession of the Demised Premises by Landlord shall be construed as an election to terminate this lease unless the written notice of such intention be given by Landlord to Tenant at the time of such re-entry; but notwithstanding any such re-entry and reletting without termination, Landlord may at any time thereafter elect to terminate this lease for such previous breach. In the event of any termination of this Lease by Landlord, whether before or after re-entry, Landlord may recover from Tenant damages incurred by reason of such breach, including the cost of recovering the Demised Premises and the difference in value between the rental which would be payable by Tenant hereunder for the remainder of the term and such reasonable rental value of the Demised Premises for the remainder of the term. (c) If Tenant shall vacate, fail to operate in or abandon the Demised Premises or any substantial part thereof, and if such unauthorized absence, failure to operate or abandonment shall continue for a period of twenty-one (21) days, then in addition to the remedies set forth in (b) above, Landlord shall have a lien on all furniture, household furnishings, trade fixtures, equipment and other personal property to which the Tenant has legal title and which remains on the Demised Premises, which lien may be enforced pursuant to N.C.G.S. §44A-2(e)by public sale, and which lien shall be for the amount of any rents which were due the Landlord at the time Tenant vacated the Demised Premises and for the time,up to sixty(60) days, from vacating the Demised Premises to the date of sale, and for any sums necessary to repair damages to the Demised Premises caused by Tenant, normal wear and tear excepted, and for reasonable costs and expenses of sale. IDENTITY OF INTEREST 30. The execution of this Lease or the performance of any act pursuant to the provisions thereof shall not be deemed or construed to have the effect of creating between Landlord and Tenant the relationship of principal or agent, or of a partnership or joint venture. INVALIDITY OF PARTICULAR PROVISIONS 31. If any term or provision of this Lease, or the application thereof to any person or circumstance shall, to any extent be invalid or unenforceable, the remainder of this Lease, or the application of such term or provision to persons or circumstances, other than those as to which it is held invalid or unenforceable, shall not be affected thereby, and each term and provision of this Lease shall be valid and be enforced to the fullest extent permitted by law. BROKER 32. There is no broker involved in the negotiation or transaction of this Lease. CAPTIONS Initials 17 (308 W.Franklin St.) Landlord Tenant 21 33. Any headings preceding the text of the several Articles and Subparagraphs hereof are inserted solely for convenience and reference and shall not constitute a part of this Lease Agreement, nor shall they affect is meanings, construction or effect. TIME 34. Time is of the essence in this Agreement. Whenever a period of time is herein prescribed for action to be taken by Landlord or Tenant, or whenever a date for completion of such action is specified herein, Landlord or Tenant shall not be liable or responsible for, and there shall be excluded from the computation of any such period of time, (or such date shall be extended for a period equal to, as the case may be), any delays due to war, civil commotion, acts of God, strikes or other labor disputes, governmental restrictions or regulations or interference, fire or other casualties, or any other causes of any kind whatsoever which are beyond the reasonable control of Landlord or Tenant, as the case may be. MEMORANDUM OF LEASE 35. Tenant and Landlord shall execute and record a Memorandum of Short Form of Lease, but said Memorandum of Short Form of Lease shall not be deemed to modify, change or affect any provision of this Lease in any manner whatsoever. ENTIRE AGREEMENT 36. This Lease Agreement, with the Exhibits attached hereto, contains all of the agreements and conditions made between the parties hereto and may not be modified orally, or in any manner other than by agreement, in writing, signed by the parties hereto or their respective successors in interest. LEASE INURES TO THE BENEFIT OF THE ASSIGNEES 37. This Lease and all the covenants, provisions and conditions contained herein shall inure to the benefit of and be binding upon the heirs,personal representatives, successors and assignees, respectively of the parties hereto. Initials 18 (308 W.Franklin St.) Landlord Tenant 22 IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the day and year first above written. LANDLORD: ATTEST: By: Charles J. Coates By: Geraldine Dawson TENANT: ATTEST: By: Orange County Title ATTEST: By: Title Initials 19 (308 W.Franklin St.) Landlord Tenant 23 STATE OF NORTH CAROLINA COUNTY OF ORANGE GUARANTY OF LEASE THIS GUARANTY OF LEASE, made and entered into October 10, 2007 by and between Charles J. Coates and Geraldine Dawson Coates as Landlord, and Orange County,North Carolina, as Tenant, for premises located at 308 W. Franklin St., Chapel Hill,NC 27516; In consideration of Landlord's entering into the foregoing Lease (herein called the "Lease") with Tenant, and other good and valuable consideration,the receipt and sufficiency of which is acknowledged by the undersigned(herein called"Guarantors"), Guarantors guarantee the full and punctual payment of rent and other charges, rates and sums to be paid by Tenant (or any permitted successor, assignee or subtenant of Tenant, herein collectively called "Tenant") under the Lease and the performance by Tenant of all of the terms and conditions thereof, and agrees as follows: 1. Guarantors hereby unconditionally and irrevocably guarantee to Landlord: (i) the due and punctual payment in full(and not merely the collectability) of the Rent due and payable under the Lease; (ii) the due and punctual payment in full(and not merely the collectability)of all other sums and charges which may at any time be due and payable in accordance with, or under the terms of the Lease, whether to Landlord or third parties; (iii) the due and punctual payment in full(and not merely the collectability) of all damages which may arise or be payable as a consequence of nonperformance or nonobservance of any term, covenant or condition contained in the Lease on the part of the Tenant thereunder to be performed or observed (whether provided for in the Lease or otherwise allowable by law); and (iv) the due and punctual performance of all of the other terms, covenants and conditions contained in the Lease on the part of the Tenant to be performed. If Tenant shall fail to duly and punctually pay such Rent or any other sums, charges or damages due to Landlord or third parties under the Lease, Guarantors shall forthwith pay the same, together with interest on the Rent and other sums which are payable directly to Landlord at the rate of eighteen percent (18%) per annum simple interest (or the then maximum rate of interest permitted by law, whichever is less), and together with interest and/or penalties on such sums, charges and damages which are due to third parties under the Lease, from the due date thereof under the Lease to the date of payment. Interest shall accrue and become payable only upon and after the expiration of any grace period. 2. Guarantors expressly agree that Landlord may, in its sole and absolute discretion, without notice to or the further assent of Guarantors and without in any way releasing, affecting or impairing the obligations and liabilities of Guarantors hereunder (except that the obligations and liabilities of Guarantors hereunder shall be reduced or released to the same extent as Tenant's obligations are expressly reduced or released action of Landlord under subdivisions (i), (ii), and (iii) hereof), (1) waive compliance with or any default under, or grant any other indulgences with respect to, the Lease; (ii)modify, amend or change any provisions of the Lease; (iii) grant extensions or renewals of the Lease and/or effect to the substitution, exchange, release or other disposition for all or any part of the Leased Premises; (iv) make advances for the purposes of performing any term or covenant contained in the Lease, with respect to which the Tenant shall be in default; (v) assign or otherwise transfer its interest in the Leased Premises, or this Guaranty or any interest therein or herein; (vi) consent to an assignment of the Tenant's interest under the Lease by Tenant; and (vii) deal in all respects with the Tenant as if this guaranty be unconditional, irrespective of the genuineness, validity, regularity or Initials 20 (308 W.Franklin St.) Landlord Tenant 24 enforceability of the Lease or any other security given therefor or in connection therewith, including, but not limited to, any assignment of leases and rents, or any other circumstance which might otherwise constitute a legal or equitable discharge of a surety or guarantors. 3. The liabilities of Guarantors under this Guaranty shall be separate and cumulative, and primary, direct and immediate and not conditional or contingent upon pursuit by Landlord of any remedies it may have against the Tenant or any other party with respect to the lease, whether pursuant to the terms thereof or by law. Without limiting the generality of the foregoing, Landlord shall not be required to make any demand on the Tenant and/or any other party or otherwise pursue or exhaust its remedies against the Tenant or any other party before, simultaneously with or after enforcing its rights and remedies hereunder against Guarantors. Any one or more successive and/or concurrent actions may be brought hereon against Guarantors either in the same action, if any, brought against the Tenant and/or any other party, or in separate actions, as often as the guarantors under this Guaranty shall continue after any assignment or transfer by the Tenant of its interest under the Lease. 4. Guarantors hereby expressly waive: (i) presentment and demand for payment and protest and nonpayment; (ii) notice and protest; (iii) notice of default hereunder or under the Lease and of all indulgences (subject to the provisions of paragraph 1 hereof); (iv) demand for observance or performance of, or enforcement of, any terms or provisions of this Guaranty or the Lease; (v) all of the notices and demands otherwise required by law which Guarantors may lawfully waive (subject to the provisions of paragraph 1 hereof). Guarantors, to the extent that it may lawfully do so, also waive trial by jury in any action brought on or with respect to this Guaranty and agrees that in the event this Guaranty shall be enforced by suit or otherwise, or if Landlord shall exercise any of its remedies under the Lease, Guarantors will reimburse Landlord, upon demand, for all reasonable expenses incurred in connection therewith, including,without limitation,reasonable attorneys' fees. 5. If Guarantors at any time before or after the date hereof have advanced or shall advance any sums to the Tenant, or if the Tenant shall be or shall become indebted to the Guarantors, such sums and indebtedness shall be subordinate in all respects to the amounts then or thereafter due and owing to Landlord under the Lease. Nothing herein contained shall be construed to give the Guarantors any right of subordination in and to the Landlord's rights under or interest in the Lease until all amounts owed to Landlord thereunder have been paid in full. 6. Any notice, demand, request or other communication given hereunder or in connection herewith (hereinafter "Notices") shall be deemed sufficient if in writing and sent by first class mail, postage prepaid, addressed to the party to receive such Notice: If to Landlord at: Charles J. Coates 5001 Cole Mill Road, Durham,NC 27705 If to Guarantors at: and Phone Phone Either party may from time to time change the address to which Notices are to be directed by Notice given in like fashion. Notices shall be deemed given when received. 7. All rights and remedies afforded to Landlord by reason of this Guaranty and the Lease, or by law, are separate and cumulative and joint and several and the exercise of one shall not in any way limit or prejudice the exercise of any of other such rights or remedies. No delay or omission by Landlord in exercising such right Initials 21 (308 W.Franklin St.) Landlord Tenant 25 or remedy shall operate as a waiver thereof. No waiver of any rights and remedies hereunder, and no modification or amendment hereof, shall be deemed made by Landlord unless in writing and duly signed by Landlord. Any such written waiver shall apply only to the particular instance specified therein and shall not impair the further exercise of such right or remedy or of any other right or remedy of Landlord, and no single or partial exercise of any right or remedy hereunder shall preclude any other or further exercise thereof or of any right or remedy. 8. This Guaranty shall inure to the benefit of, and be enforceable by, Landlord and its successors and assigns as owners of the Landlord's interest in the Lease or in the Lease Premises and shall be binding upon and enforceable against, Guarantors and their respective heirs, legal representatives and assigns. 9. If Guarantors are other than an individual, the officers, agents or others executing this Guaranty on behalf of the Guarantors personally warrant and represent to Landlord that they have been authorized to execute this Guaranty by and on behalf of the Guarantors. 10. This Guaranty shall be governed by the internal laws of the State of North Carolina. IN WITNESS WHEREOF, Guarantors have executed this Guaranty, under seal, the day and year first above written. (SEAL) (print name of Guarantor) (SEAL) (print name of Guarantor) Initials 22 (308 W.Franklin St.) Landlord Tenant 26 LEASE PROVISIONS INFORMATION SHEET TYPE OF LEASE: Q New Renewal Expansion Option Change/Adj. BUSINESS NAME: Orange County TENANT: Orange County, a NC political subdivision ADDRESS: (0) F) (C) (H) (e-mail) PROPERTY ADDRESS: Europa Center— Suite 101 100 Europa Dr., Chapel Hill, NC 27517 LANDLORD: EUROPA CENTER, LLC NOTICE ADDRESS: Avison Young - NC, LLC 100 Europa Dr—Suite 190, Chapel Hill, NC 27517 RENT PAYMENTS: Europa Center, LLC, c/o Avison Young - NC, LLC P.O. Box 900002, Raleigh, NC 27675-9000 LEASE TERM: Three (3) Years RENT PSI=: $21.00 RENTABLE SO. FTG: 10,615 LEASE SIGNED: January , 2020 LEASE COMMENCES: March 1, 2020 MOVE-IN DATE: March 1, 2020 RENT COMMENCES: March 1, 2020 LEASE EXPIRES: February 28, 2023 MONTHLY BASE RENT: $18,576.25 ANNUAL BASE RENT: $222,915.00 RENT ADJUSTMENTS: An annual fixed increase of Three percent (3 %) to the Base Rent on the lease anniversary date. - See RENT SUMMARY for schedule. OPERATING EXPENSE ADJUSTMENT: Base year is established as 2020. PRORATION: Calculation of Rents is based on the annual rent amount divided by a 365 day year. OPTION TO RENEW: Provided the Tenant is not in default of any terms of this lease, at the end of the Initial Term, this Lease may be extended for Two(2)terms of One(1)year each, commencing at the expiration of the initial term with Ninety(90) days prior written notice. ALL RENTS ARE DUE ON THE Is` DAY OF EACH MONTH: Any payment not received by the 5th of the month will incur an automatic late fee of Five (5 %) percent. SECURITY DEPOSIT: An amount equal to one(1)month rent of$NIA will be held as a Refundable Security Deposit. PAID BY LANDLORD: Property Taxes, Insurance, Exterior and Common Area Maintenance, All Utilities including Common Area(Electrical,Water&Sewer), Security, Management, HVAC Maintenance,Janitorial, Trash Removal and Extermination. PAID BY TENANT: Fire & Extended Coverage Insurance for tenant contents, Commercial General Liability Insurance for Tenant, all telephone, cable, internet, etc. installation costs and monthly service charges, and pro-rats share of Operating Expense increases over base year. Revised 3/12 Page I -THE EtTROPA CENTER Lease Landlord Tenant Initials Initials 27 RENT SUMMARY Orange County, a NC political subdivision (Tenant) 10,615 (Sq. Ft) TErm #df Months Start DAe End Date LF PSi $Month Tatd$ 1 12.00 03/01/20 02/28/21 10,615 $21.00 $18,576.25 $222,915.00 2 12.00 03/01/21 02/28/22 10,615 $21.63 $19,133.54 $229,602.45 3 12.00 03/01/22 02/28/23 10,615 $22.28 $19,707.54 $236,490.52 Total 36.00 $689,007.97 Option Tame~ #d Maift Start D& End Date S PSF Fhe $Month Tdal$ 1 12.00 03/01/23 02/29/24 10,615 $22.95 $20,298.77 $243,585.24 1 12.00 03/01/24 02/28/25 10,615 $23.64 $20,907.73 $250,892.80 if eabsat PLEASE MAKE RENT PAYMENTS TO: Europa Center, LLC, c/o Avison Young - NC, LLC P.O. Box 900002, Raleigh, NC 27675-9000 Page 2 -THE EUROPA CENTER Lease Landlord Tenant Initials Initials 28 EUROPA CENTER LEASE CONTENTS OF LEASE BY SECTION SECTION NUMBER AND SUBJECT PAGE NUMBER Lease Provisions Information 1 Rent Summary 2 Contents of Lease 3 1. Definitions 4 2. Demise 4 3. Term 4 4. Rent 4 5. Late Payment 5 6. Security Deposit 5 7. Use of Leased Premises 5 8. Signs 5 9. Care and Maintenance 5 10. Alterations by Tenant 6 11. Acceptance of Leased Premises 7 12. Delay in Commencement 7 13. Subleasing and Assignment 7 14. Default 8 15. Holding Over 9 16. Surrender of Rented Space 9 17. Damage to Rented Space or Building 9 18. Tenant's Indemnity and Tenant's Insurance 10 19. Tenant's Waiver of Claim; Mutual Releases 11 20, Eminent Domain 11 21. Utilities and Other Services 11 22. Covenants of Title and Quiet Enjoyment 12 23. Common Areas 12 24. Use of Parking Facilities 13 25. Information Concerning Tenant 13 26. Authority of Tenant 13 27. Estoppel 13 28. Right to Relocate 14 29. Landlord's Access to Rented Space 14 30. Managing Agent 14 31. Subordination 14 32. Reservation of Rights 15 33. Notices 15 34, Entire Agreement; Modification 15 35. Riders and Exhibits 15 36. Section Headings 16 37. Number and Gender 16 38. Governing Law 16 39, Severability 16 40. Modification by Mortgagee 16 41. Binding Effect 16 42. Limitation on Right of Recovery 16 43. Brokerage 16 44. Confidentiality 16 Signature Page 17 EXHIBITS EXHIBIT A - Site of Europa Center 18 EXHIBIT B - Sketch of Rented Space 19 EXHIBIT C Rules and Regulations 20-21 THE TERMS OF THIS LEASE ARE CONFIDENTIAL Page 3 -THE ELTROPA CENTER Lease Landlord Tenant Initials Initials 29 EUROPA CENTER OFFICE LEASE This lease(the"Lease")is made as of January , 2020 by and between Europa Center, LLC(collectively, "Landlord")and Orange County, a North Carolina political subdivision("Tenant"). Both parties acknowledge that Avison Young-NC, LLC, a North Carolina Limited Liability Company, is the authorized agent of Landlord, with full power and authority to execute this Lease on behalf of Landlord and to bind the Landlord to its terms. In consideration of the reciprocal obligations stated herein, Landlord and Tenant agree as follows: 1. DEFINITIONS. When used in this Lease, the terms listed below shall have the meanings stated in this Section 1. (a) "Building": the five-story office building in which the Rented Space is located. (b) "Commencement Date": the actual date on which the term of this Lease commences, as provided in Section 3 below. (c) "Common Areas": Any existing or future equipment,improvements,areas or spaces intended for the joint use of Landlord, Tenant and other tenants, occupants or users of the Europa Center. Common Areas include but are not limited to sidewalks, driveways, stairways, halls, lobbies, elevators, passages and parking facilities. (d) "CPI"shall mean the Consumer Price Index-U.S. City Averages for Urban Wage Earners and Clerical Workers - All Items (base year 1982-84=100), published by the United States Bureau of Labor Statistics. (e) "Europa Center": that tract of land located in Chapel Hill Township, Orange County, North Carolina, described in Exhibit A attached hereto and incorporated herein, and all improvements situated thereon. (f) "Lease Year": each twelve (12) month period of the Term beginning with March 151 and ending on February 28th. The first Lease Year shall begin on March 1, 2020 and shall end February 28, 2021. (g) "Leased Premises": the Rented Space, together with the nonexclusive right to use the Common Areas as provided in Sections 23 and 24 of this Lease. (h) "Rentable Square Feet": the useable square feet of any area multiplied by a core factor of 1.15. 0) "Rented Space": that office space area shown as the cross-hatched area on Exhibit B attached hereto and incorporated herein, which is designated Suite 101 of the Europa Center and which consists of approximately 10,615 Rentable Square Feet. (j) "Term": the term of this Lease as specified in subsection (a)of Section 3 below. 2. DEMISE. Subject to the terms and conditions stated in this Lease, Landlord hereby leases the Leased Premises to Tenant, and Tenant hereby leases the Leased Premises from Landlord. 3. TERM AND OPTION TO RENEW. (a) Term. The term of this Lease shall commence on the earlier of:(1)the date that Tenant takes possession of any part of the Rented Space, or(2)March 1,2020. The term shall terminate at 11:59 P.M.on February 28, 2023, if not sooner terminated by Landlord pursuant to the terms of this Lease. (b) Option to Renew. Provided the Tenant is not in default of any terms of this Lease, at the end of the Initial Term, this Lease may be extended for Two (2)terms of One(1)year each, commencing at the expiration of the initial(or then current)term with Ninety(90)days prior written notice. See Rent Summary for scheduled rent increases for each Option to Renew. (c) No Reinstatement. No receipt of money by Landlord from Tenant or any other party after the termination of this Lease shall reinstate, continue or extend the Term or affect any notice of termination served on Tenant by Landlord. 4. RENT. (a) Initial Annual Base Rent. For the First Lease Year, Tenant shall pay to Landlord annual base rent in the amount of$222,915.00, payable in equal monthly installments of$18,576.25 each,commencing Marchl, 2020, and according to the following schedule: .Page 4 -THE EUROPA CENTER Lease Landlord Tenant Initials Initials 30 T #d Months Stat DatE End D31e SF PSFFUe $Mmth Total$ 1 12.00 03/01i20 02/28/21 10.615 $21.00 $18,576.25 $222,915.00 2 12.00 03/01/21 02/28/22 10,615 $21.63 $19,133.54 $229,602.45 3 12.00 03101/221 02/28/23 10,615 $22.28 $19,707.54 $236,490.52 Total 36.00 $689,007.97 Option Tam #d Months Start Dle End SF P$F Poe $SMaittt Total$ 1 12.00 03/01i23 02/29/24 10,615 $22.95 $20,298,77 $243,585.24 1 12.00 03/01/24 02/28/25 10,615 $23.64 $20,907.73 $250,892.80 'rf exadsed For each succeeding Lease Year of the Term, Tenant shall pay to Landlord annual base rent as determined pursuant to subsection(b)below, payable in equal monthly installments commencing on the first day of each Lease Year. All monthly base rent payments shall be due on the first day of each month in advance,without notice or demand. All rent payments shall be made to Landlord at: Europa Center, LLC,c/o Avison Young - NC, LLC, P.O. Box 900002, Raleigh, NC 27675-9000, or at such other place as Landlord may designate from time to time in writing. (b) Adjustments to Annual Base Rent. At the end of each Lease Year of the Term, the annual base rent to be paid to Landlord by Tenant for the upcoming Lease Year will be subject to an increase in annual base rent of three percent(3.00%) per Lease Year. (c) Base Rent for Partial Month. Base rent due for any partial month at the beginning of the Term shall be $51.89 per day, payable in advance on the Commencement Date. Base rent due for any partial month at the end of the Term shall be determined on a per diem basis, using the then applicable annual base rent. Calculation of Rents is based on the annual rent amount divided by a 365 clay year. (d) Operating Expense Adjustment. The Annual Base Rent shall remain in effect without adjustment throughout the Base Year. For the remainder of the term of this Lease the Annual Base Rent shall be subject to periodic adjustment in accordance with the following provisions: (i)"Base Year" shall mean the calendar year of the date of this Lease which is 2020. (ii) "Annual Base Rent" shall mean the Initial Annual Base Rent as specified and defined above in Paragraph 4(a)of this Lease, including any and all adjustments as further stipulated in Paragraph 4(b)of this Lease for each subsequent Lease Year. (iii) "Comparison Year"shall mean calendar year 2021. Each succeeding comparison year shall be a calendar year having an anniversary date of January 1. (iv) "Operating Expenses" shall mean all direct costs of repair, operation, maintenance and management incurred by Landlord with respect to the buildings, grounds and premises, and properly chargeable against income as determined by standard accounting practices;these shall include the following costs by way of illustration, but not limitation: utility charges; hazard and liability insurance premiums; ad valorem real and personal property taxes; costs incurred in the management of the building; costs incurred in securing the building; costs incurred in painting, lighting and upkeep of the building and premises; supplies; materials, equipment and tools; further operating expenses, including, but not limited to maintenance costs for maintenance, upkeep, repair and replacement of the following: HVAC; all lighting fixtures; elevators;janitorial service; inspections, licenses&permits;snow removal; upkeep and landscaping of all grounds; upkeep, repair and maintenance of parking lot and parking garage; trash removal; labor; uniforms; and building and premises security,and any other expenses necessary for the maintenance, repair and upkeep of any and all common areas of the Buildings, parking lots and garage, pond, fountain and grounds. Operating expenses shall not include the following:depreciation and amortization on the Buildings or equipment therein; interest expenses and all other costs related to Landlord's financing,if any;advertising; real estate broker's commissions; repairs or other work occasioned by fire,windstorm or other casualty of an insurable nature or by the exercise of eminent domain or any expenditures for which Landlord is entitled to be reimbursed from any source including without limitation, insurance and condemnation proceeds; costs and expenses associated with leasing to other tenants, including tenant improvement allowances,attorney's fees, and architectural fees, if any; costs directly attributable to the design and construction of improvements, or renovating or decorating, painting or redecorating space for other tenants; expenses in connection with services or other benefits of a type which are not provided to Tenant but which are provided to another tenant or occupant, if any;the cost of clean-up or remediation of hazardous or toxic wastes which are not caused by Tenant; costs, fines or penalties incurred due to violation by Landlord or any other tenant of the terms and conditions of any lease, laws or regulations, if any; amounts for services paid to entities of Landlord which exceed the amount that would have been paid to unaffiliated entities; all costs, items and services for which any tenant or third party reimburses Landlord; or any improvements of a capitalized asset. Page 5 -THE EUROPA CENTER Lease Landlord Tenant Initials Initials 31 (v) Landlord shall provide Tenant with a statement showing actual Operating Expenses within 90 days after the end of each comparison year. Balance due, if any, shall be paid in full by Tenant within 30 days of receipt. If in the twelve-month period preceding the computation of each Operating Expense Adjustment, the occupancy of the net Rentable Square Feet of the Building averages less than ninety-five percent(95%), then it is agreed that the Landlord's Operating Expenses will be adjusted for such year so that such Operating Expenses shall be computed as though the net Rentable Square Feet of the Building has been ninety-five percent(95%) occupied for such calendar year. (e) Abated Rent. For the first NIA month period following the Commencement Date, Tenant shall have no obligation to pay any Rent or other charges due under this Lease, except for its utility services (telephone and internet). (f) Additional Rent. All other charges, costs and sums required to be paid by Tenant to Landlord under this Lease shall be deemed to be additional rent, and shall be collectable by Landlord as such. (g) Independent Covenant. The obligation to pay any and all rent hereunder is a separate and independent covenant of Tenant,and no breach or alleged breach by Landlord of the terms hereof shall give Tenant any right to withhold or escrow any rental payments when due. 5. LATE PAYMENT. Tenant recognizes and acknowledges that if rent payments are not received when due, Landlord will suffer damages and additional expense. Tenant therefore agrees that a late fee equal to five(5%)percent of the rent which is late may be assessed by Landlord as additional rent if the Landlord has not received any monthly installment of annual rent or other rent or additional rent due pursuant to this Lease within five(5)days of its due date. If any check given in payment of rent is not honored when due, Landlord may assess the late fee and may also require that subsequent rent payments be made by certified or cashier's check. Landlord's rights under this Section 5 are in addition to and maybe exercised cumulatively with Landlord's rights and remedies under Section 14 below. 6. SECURITY DEPOSIT. Tenant fails at aRy time to peFferm its ebligations 6andlard may at its eptieR apply the deP96it, OF 60 FAUGh theFeef as is Feq ui Fed, tE)GUF8 T8Rant's d flault.. liattiaRytiM8 PF19Ft9 the te�m'Ratien of this Lease Land' depletes the depesit on whele GF in paFt, TeRant shall immediately Festere the amount so used by Landlord. Unless 6andleFd ures the deposit to GwFe a default of TeRaRt, OF tG FesteFe the Leased Pr-emises te the GGRditi9n that Tenant Is FeqUiFed to leave them at the GORGIUSOOR of 4he Term, Landler-d shall withiA!hiFty(30) nteFe st earpe 7. USE OF LEASED PREMISES AND COMPLIANCE WITH LAW. The Leased Premises shall be used only for general office purposes, and for no other purposes without the Landlord's prior written consent. Tenant shall not use the Leased Premises for any unlawful purpose or in any manner that might constitute a nuisance. Tenant shall comply with all land use covenants and Rules and Regulations (see Exhibit C) pertaining to the Leased Premises, and all ordinances and regulations of governmental authorities applicable to the Leased Premises. 8. SIGNS. Landlord shall furnish, install and maintain a sign at the entry to Tenant's office, and a Building directory at a convenient location in the Building, listing the name of the Tenant and the suite number of Tenant's entrance office. No other signage shall be installed by Tenant anywhere at the Europa Center without Landlord's written consent, which may be withheld in Landlord's sole discretion. Any other sign requested by the Tenant and approved by Landlord which is of greater cost than the sign ordinarily furnished by the Landlord shall be paid for by the Tenant, and shall be installed by the Landlord at Tenant's expense 9. CARE AND MAINTENANCE. Subject to the provisions of Section 29, Tenant shall, at the Tenant's own expense, keep the Rented Space in good condition and shall pay for the repair of any damages caused by the Tenant, its agents, employees, invitees or contractors. Tenant shall make at its sole cost and expense, replacements or restorations, in quality equivalent to or better than the original work, as may be required to maintain the Rented Space in good repair and condition, ordinary wear excepted. With respect to repairs requested by Tenant to be performed by Landlord,the Tenant shall pay the Landlord for any expense incurred by the Landlord, including overtime, in the event repairs, alterations, decorating or other work in the Rented Space are not made during ordinary business hours. 10. ALTERATIONS BY TENANT. (a) Requirements. Tenant shall not do any painting or decorating, or erect any partitions, make any alterations in or additions to the Rented Space or do any nailing, boring or screwing into the ceilings,walls or floors (collectively and individually, "Alterations") without the Landlord's prior written general and specific consent in each and every instance,with the exception of picture hanging and limited installation of shelving. Page 6 -THE EUROPA CENTER Lease Landlord Tenant Initials Initials 32 Landlord may withhold its consent, in its sole discretion. Unless otherwise agreed by Landlord and Tenant in writing,the work on all such Alterations shall be performed either by or under the direction of Landlord, but at the cost of Tenant. If the Landlord gives its preliminary consent to any such Alterations, the Tenant shall furnish to the Landlord for approval before commencement of the work or delivery of any materials to the Europa Center all of the following: (i) all plans and specifications; (ii) names and addresses of all contractors; (iii) copies of all contracts; (iv)all necessary permits; (v) an indemnification of Landlord by all contractors in form and amount satisfactory to Landlord;and (iv) certificates of insurance from all contractors performing labor or furnishing materials, insuring against any and all claims, costs, damages, liabilities and expenses which may arise in connection with such Alterations. Within ten (10) business days of receiving all of the items specified in (i) through (v) above, in full and complete form, Landlord shall specifically approve or disapprove in writing each of the items. Tenant shall modify, supplement or substitute such items as Landlord disapproves, pursuant to Landlord's written instructions, and resubmit such items to Landlord for its approval. Landlord shall respond in writing to each resubmission within ten (10) business days. Tenant shall not commence any work or have any supplies or materials delivered to the Europa Center Until it has received Landlord's specific written approval of all such items. (b) No Interference or Disruption. The Alterations and all related construction activities shall not interfere with the normal operations of the Europa Center. The Landlord reserves the right to determine whether the Alterations or any portion of them must be made after normal business hours. (c) Liability. Regardless of who performs any Alterations and notwithstanding Landlord's consent thereto, Tenant shall hold the Landlord, its agents and employees forever harmless from any and all liabilities of every kind and description which may arise out of or be connected in any way with the Alterations. Any mechanic's lien filed against the Rented Space or the Europa Center for work or materials claimed to have been furnished to the Tenant shall be discharged of record by the Tenant within ten (10)days after filing, at the Tenant's expense. Upon completing any Alterations, the Tenant shall furnish the Landlord with contractors' affidavits, full and final waivers of lien and receipted bills covering all labor and materials expended and used. All Alterations shall comply with all insurance requirements and with all ordinances and regulations of any applicable public authority. All Alterations shall be performed in a good and workmanlike manner, using first class materials. (d) Ownership. All Alterations, made by either party, including without limitation all paneling, decorations, partitions, railings, mezzanine floors, carpets, galleries, heating or air conditioning equipment, plumbing, electrical machinery and equipment, shall become the property of Landlord and shall remain upon and be surrendered with the Rented Space as a part of the Rented Space at the end of the Term; provided that if requested by Landlord on termination of this Lease,Tenant shall restore the Rented Space to the same condition as at the Commencement Date. Furniture and movable trade fixtures which are installed by Tenant at its expense, except for those referred to above, shall remain Tenant's property and may be removed at any time prior to the termination of the Term provided Tenant is not then in Default and further provided Tenant promptly repairs any damage caused by such removal. Any such trade fixtures which Tenant has the right to remove under the above provisions, or personal property belonging to Tenant or to any invitee, assignee or subtenant, shall be deemed abandoned by Tenant if not removed prior to termination of the Term, and shall become the property of the Landlord without any payment or offset for the property, if Landlord so elects. If the Landlord does not so elect, the Landlord may remove any fixtures or property from the Leased Premises and store them at the Tenant's sole risk and expense or dispose of them in any manner, including the sale, scrapping or destruction thereof, and to the extent permitted by law Tenant waives all claims against Landlord therefor. The Tenant shall repair and restore, and save the Landlord forever harmless from, any and all damage to the Leased Premises caused by such removal, whether by the Tenant or by the Landlord. 11. ACCEPTANCE OF LEASED PREMISES. Occupation by Tenant shall constitute acceptance of the Leased Premises AS IS, except for latent defects and deficiencies specified in writing by Tenant to Landlord within ten(10)days after Tenant's occupancy. Landlord makes no representation or warranty,oral or written, as to the condition of the Leased Premises nor as to the use or fitness of the Leased Premises for any particular purpose except for general office use. Landlord shall not be responsible for obtaining any governmental approvals or permits necessary to enable Tenant to occupy or use the Leased Premises(other than the certificates of occupancy or other approvals related to work done by Landlord to upfit the Rented Space). Obtaining such other approvals and certificates shall be the sole responsibility of the Tenant. The Landlord shall not be responsible for obtaining any certificate of occupancy or other approvals required in connection with construction work done by the Tenant or contractors engaged by the Tenant. 12. DELAY IN COMMENCEMENT. Landlord shall not be liable to Tenant or any third party for failure to deliver possession of the Rented Space to Tenant on or before the Commencement Date, if such failure is due to any of the following: Page 7 -THE EUROPA CENTER Lease Landlord Tenant Initials Initials 33 0) labor disputes and/or material shortages; (ii) force majeure or acts of God, including but not limited to abnormal weather conditions; (iii) the hold over or retention of possession of any other tenant, tenants, or occupants; or (iv) any other circumstances beyond Landlord's reasonable control. Under such circumstances,the Base Rent shall be abated until the Rented Space is available for occupancy by Tenant, and no such failure to give possession on the Commencement Date shall affect the validity of this Lease or the obligation of the Tenant under this Lease. At the option of Landlord, to be exercised within thirty (30) days of the Commencement Date, the Lease may be amended so that the Term is extended by the period of time possession by Tenant is delayed. The Rented Space shall not be deemed to be unready for Tenant's occupancy or incomplete if: (i) only minor or insubstantial details of construction, decoration or mechanical adjustment remain to be done in the Rented Space or any part of the Rented Space; (ii) the delay in the availability of the Rented Space for occupancy shall be due to special work, changes, alterations or additions required or made by Tenant in the layout or finish of the Rented Space or any part thereof; (iii) the delay is caused in whole or in part by the delay of Tenant in submitting plans, supplying information, approving plans,specifications or estimates,giving authorizations or otherwise;or (iv) the delay is caused in whole or in part by delay and/or default on the part of Tenant and/or its subtenant or subtenants. In the event of any dispute as to whether the Rented Space are ready for Tenant's occupancy,the decision of the Landlord's architect shall be final and binding on the parties. 13. ASSIGNMENT OR SUBLEASE. (a) Assignment. Tenant may not assign this Lease. If Tenant is not a publicly owned corporation whose outstanding voting stock is listed on a national securities exchange,then any transfer of any interest in Tenant that results in a change of the controlling ownership of Tenant shall be deemed an assignment of this Lease and a default by Tenant hereunder; provided that nothing herein shall be deemed to prohibit(i)a public offering of the stock of Tenant pursuant to the Securities Act of 1933 and/or Securities Exchange Act of 1934, as amended;or(ii)a transfer of ownership between the current owners of Tenant and their spouses,children, or grandchildren by inter vivos or testamentary transfer. Any involuntary transfer of any interest in Tenant or Tenant's interest in this Lease shall be deemed an assignment of this Lease and a default hereunder. (b) Subletting. Tenant may not sublet the Leased Premises or any part thereof without the prior written consent of Landlord, which shall not be unreasonably withheld. In any event, Tenant shall not advertise or publicize the Leased Premises for subletting whether through a broker, agent, representative or otherwise at a rental rate less than that for which space in the Europa Center is being offered for rent by Landlord. If Tenant seeks to sublet all or any part of the Leased Premises, then the following shall apply: (1) Prior to any sublease,Tenant shall first notify Landlord in writing of its intent to sublet all or a portion of the Leased Premises, such notice to include a copy of the proposed sublease. At any time within fifteen (15) business days after service of said notice, Landlord shall notify Tenant that: (i) it consents to the sublease; or (ii) it refuses to consent to the sublease; or (iii) with respect to a proposed sublease of the entire Rented Space, that it terminates this Lease effective as of the beginning of the proposed sublease term, which Landlord shall be fully empowered to do, at Landlord's option, if Tenant seeks to sublet the entire Rented Space; or (iv)with respect to a proposed sublease of part of the Rented Space, that, effective as of the beginning of the sublease term, it amends the Lease to reduce the Rented Space by the portion of the Rented Space proposed to be sublet and further amends the Lease because of the reduction of the Rented Space so that all calculated items are reduced proportionately to the reduction in Rentable Square Feet of the Rented Space. (2) If Tenant shall sublet the leased Premises at a rental or other economic benefit in excess of the then current Base Rent, Fifty percent(50%)of such excess shall be for benefit of Landlord and shall be paid to Landlord in cash promptly when due under any such sublease as additional rent due under this Lease (3) Tenant agrees to pay to Landlord,on demand,all reasonable costs incurred by Landlord in connection with any request by Tenant for Landlord's consent to any sublease, including but not limited to reasonable attorney's fees and recording fees. (4) Any sublease shall not release Tenant of its liability under this Lease or permit any subsequent sublease. 14. DEFAULT BY TENANT AND LANDLORD'S REMEDIES. (a) Events of Default. In addition to the other occurrences listed elsewhere in this Lease, the occurrence of any one or more of the following shall constitute a default hereunder: Page 8 -THE EUROPA CENTER Lease Landlord Tenant Initials Initials 34 (1) If Tenant fails to pay any rent or other monetary payments as and when provided in this Lease; (2) If Tenant breaches any other agreement or obligation herein set forth and fails to cure such breach within ten(10)days after notice thereof; or if cure of the breach would require more than ten(10) days to effect, if Tenant fails to initiate action necessary to cure such breach within the ten(10)day period and to pursue such action diligently thereafter until the breach is cured; (3) If there is a levy, execution, attachment or taking of property, assets or the leasehold interest of Tenant by process of law or otherwise or in satisfaction of any judgment, debt or claim; or (4) If Tenant files, or has filed against it, any petition or action for relief under any debtor's relief law (including bankruptcy, reorganization or similar actions or proceedings) either in state or federal court. (b) Landlord's Rights and Remedies. In the event of any default, Landlord may at any time thereafter, with or without notice or demand and without limiting Landlord in the exercise of any right or remedy which Landlord may have by reason of default: (1) Terminate this Lease. (2) Without terminating this Lease, terminate Tenant's right to possession of the Leased Premises, enter upon and take possession of the Leased Premises and rent the Leased Premises for a reasonable rental for the account of Tenant, and after paying from rents collected the reasonable costs of such entry, reletting and collection and the costs of any necessary repairs made by Landlord which Tenant is obligated to make hereunder, apply the remainder of the rent collected to the amounts due and to become due from Tenant hereunder; (3) Pursue any other remedy now or hereafter available to Landlord under this Lease or under the laws of the state of North Carolina. All rights and remedies of Landlord pursuant to this Section shall be cumulative, and may be exercised singly, successively or, if appropriate, concurrently. In the event Landlord terminates this Lease or terminates Tenant's right to possession of the Leased Premises, then Tenant shall surrender possession of the Premises to Landlord, and Landlord shall have the full and free right to enter into and upon the Rented Space with or without process of law, to repossess the Rented Space, to expel or remove the Tenant and any others who may be occupying or be within the Rented Space, to remove any and all property from the Rented Space and to the change the locks on the Rented Space, without being deemed in any manner guilty of trespass, eviction or forcible entry or detainer. In any event of default by Tenant, Landlord shall be entitled to recover from Tenant all damage incurred by Landlord by reason of Tenant's default, including but not limited to: any unpaid rent; the cost of recovering possession of the Premises, including reasonable attorney's fees; expenses of reletting, including necessary renovation and alteration of the Premises, reasonable attorney's fees, and any real estate commission actually paid; any loss of future rental; and a pro rata portion of any leasing commission paid by Landlord based on the number of days of any period for which a commission was paid that remain after the date of Tenant's default. Any rent unpaid when due, including additional rent not paid upon demand, shall bear interest from the date due at the rate of twelve percent(12.00%)per annum. (c) Treatment of Tenant's Property. Any and all property which may be removed from the Rented Space by the Landlord pursuant to the authority of the Lease or law, to which the Tenant is or may be entitled, may be handled, removed or stored by the Landlord at the risk, cost and expense of the Tenant, and except strictly as required by law the Landlord shall in no event be responsible for the value, preservation or safekeeping thereof. The Tenant shall pay to the Landlord, upon demand, any and all expenses incurred in such removal and all storage charges for such property so long as the property shall be in the Landlord's possession or under the Landlord's control. Any such property of the Tenant not retaken from storage by the Tenant within thirty(30)days after the end of the term, however terminated, may be disposed of by Landlord in any manner whatsoever, including without limitation, the sale, scrapping and/or destruction of the property without any further obligation to the Tenant, and Tenant shall pay to Landlord promptly on demand the reasonable expenses of such disposal. (d) Landlord's Lien on Tenant's Interest. Tenant hereby grants to Landlord a first lien upon the interest of Tenant under this Lease to secure the payment of moneys due under this Lease, which lien may be enforced in equity. (e) Landlord's Lien on Tenants' Pro e . Tenant hereby grants to Landlord a lien for the payment of rent, additional rent and all other moneys to be paid by Tenant to Landlord hereunder, upon all of the goods, wares, chattels, fixtures, furniture, equipment and other property of Tenant which may be in or upon the Rented Space or the Europa Center. Such lien may be enforced in any lawful manner by of the Landlord. Page 9 -THE EUROPA CENTER Lease Landlord Tenant Initials Initials 35 (f) Landlord's Option to Cure. If Tenant defaults in the performance of any of its obligations under this Lease, including without limitation, its obligations under Section 9 hereof,then Landlord or any mortgagee or ground lessee of Landlord may, at its option, cure such default, and Tenant shall pay to Landlord or such mortgagee or ground lessor, as the case may be, the cost of such cure immediately upon being billed for same. (g) No Waiver. The failure of Landlord to declare Tenant to be in default at any time or to exercise any of its rights or remedies upon default any by Tenant shall not be deemed to be a waiver by Landlord of any of its rights or remedies hereunder. 15. HOLDING OVER. In the event the Tenant remains in possession of the Rented Space after the expiration of the Term without the written consent of Landlord, then the Tenant shall be a tenant at sufferance from month to month only, and the Tenant shall then be obligated to pay two hundred percent(200%)of the then current Base Rent and all other sums then payable hereunder ("Holding Over Rent"), in equal installments on the first day of each calendar month for so long as Landlord is kept out of possession of the Rented Space. Neither such payment nor the acceptance of such payment shall in any way constitute a waiver of the rights of Landlord to dispossess the Tenant and recover possession of the Rented Space and the just and former estate of the Landlord and to bring any action for damages suffered by Landlord on account of Tenant's failure to vacate the Rented Space. 16. SURRENDER OF RENTED SPACE. Upon the expiration or other termination of the Term, Tenant shall quit and surrender to Landlord the Rented Space, broom clean, in good order and condition, ordinary wear excepted, and Tenant shall remove all of its property except as otherwise provided in Section 10. 17. DAMAGE TO RENTED SPACE OR BUILDING. (a) Landlord's Insurance. Landlord shall maintain standard fire and extended coverage insurance covering the Building in an amount not less than 80% (or such greater percentage as may be necessary to comply with the provisions of any co-insurance clauses of the policy) of the "replacement cost" thereof as such term is defined in the Replacement Cost Endorsement to be attached thereto, insuring against special causes of loss(including the perils of fire and lighting), such coverages and endorsements to be as defined, provided and limited in the standard bureau forms prescribed by the insurance regulatory authority for the State of North Carolina. Subject to the provisions of Section 19 below, such insurance shall be for the sole benefit of Landlord and under its sole control. (b) Notice by Tenant. If the Rented Space is damaged or destroyed by any peril covered by the insurance to be provided by Landlord under subparagraph (a) above, Tenant shall give immediate written notice thereof to Landlord. (c) Extensive Damage. If the Rented Space is so damaged by any peril covered by the insurance to be provided by Landlord under subparagraph (a) above that rebuilding or repairs cannot in Landlord's estimation be completed within one hundred fifty(150)days after the date upon which Landlord is notified by Tenant of such damage, this Lease shall terminate, and the rent shall be abated during the unexpired portion of this Lease, effective upon the date of the occurrence of such damage. (d) Repairable Damage. If the Rented Space is damaged by any peril covered by the insurance to be provided by Landlord under subparagraph(a)above, but only to such extent that rebuilding or repairs can, in Landlord's estimation, be completed within one hundred fifty(150)days after the date upon which Landlord is notified by Tenant of such damage, this Lease shall not terminate, and Landlord shall, at its sole cost and expense, thereupon proceed with reasonable diligence to rebuild and repair the Rented Space to substantially the condition in which it existed prior to such damage, except that Landlord shall not be required to rebuild, repair or replace any part of the partitions, fixtures, additions and other improvements which may have been placed in, on or about the Rented Space by Tenant. There shall be no abatement of rent during any such period of rebuilding and repair. (e) Landlord's Options to Terminate: (1) Notwithstanding anything herein to the contrary, in the event the holder of any indebtedness secured by a mortgage or deed of trust covering the Building requires that the insurance proceeds be applied to such indebtedness, then Landlord shall have the right to terminate this Lease by delivering written notice of termination to Tenant within fifteen(15)days after such requirement is made by any such holder,whereupon all rights and obligations hereunder thereafter accruing shall cease and terminate. (2) Notwithstanding any other provision herein, if any portion of the Rented Space is damaged or destroyed during the final Lease Year of the initial term or any extension term of this Lease, then Landlord shall have the option to terminate this Lease upon written notice to Tenant within thirty(30)days of the date of such damage. Page 10 -THE EUROPA CENTER Lease Landlord Tenant Initials Initials 36 (3) Notwithstanding any other provision herein, if any portion of the Building other than the Rented Space is destroyed by fire or other destructive force and Landlord, in its sole discretion, elects to cease operation of the Europa Center as a result of such damage,then Landlord shall have the option to terminate this Lease upon written notice to Tenant within thirty(30)days of the date of such damage. 18, TENANT'S INDEMNITY OF LANDLORD AND TENANT'S INSURANCE. (a) Tenant's Indemnity of Landlord. Tenant shall indemnify and save the Landlord, Avison Young- NC, LLC, and their respective agents and employees harmless against any and all claims, demands, costs, and expenses, including reasonable attorney's fees for the defense thereof,arising directly or indirectly out of or in connection with Tenant's occupancy at the Europa Center or from any breach or default on the part of Tenant in the performance of any covenant or agreement on the part of Tenant to be performed pursuant to the terms of this Lease, or from any act or negligence of Tenant, its agents,servants,employees or invitees, in or about the Europa Center. Furthermore, Tenant covenants to arrange defense of Landlord, Avison Young - NC, LLC, and their respective agents and employees from any such claim, demand or action by counsel reasonably acceptable acceptable to Landlord. (b) TenanenameFGiCa' Gepe--,_' I ' iab PP IncUFa RGe Tenant shall at II times duFinq the To m at i against less, damage or -.ability f9F iRjury te er death of pefse% and 1966 OF daMage W PFG e4y eeeuFring reaseRably required 40m time tG time by Landlerd. G verage shall initially be iR the siRgle limit amount of ene (G) T@RaRt'S PMP64V IRSU-R�. Tenant Shall obtain qRd Maintain preper4y iRSUFaRG8 HPOR may fFen;time to time be lGGatedin, on ar ar-Gund the EuFepa Gente�. SuGh insuraRGe shall be maintained in Tenwit shall leek solely te its ;RsuFaRr-e PeliGy fGF FeGGVeFy Of aRy i'966 f49F any SUGh pFepeFty,and in ne even aiRst the Land! (d) r ffiz.. -eduGtion of the 19. TENANT'S WAIVER OF CLAIMS; MUTUAL RELEASES. (a) Tenant's Waiver of Claims. To the extent permitted by law,the Tenant releases the Landlord and Avison Young -NC, LLC, and their respective agents and servants from, and waives all claims for damage or injury to person or property or disruption to business sustained by the Tenant or any occupant of the Europa Center, the Building or the Rented Space, or any part or any of them, resulting from any accident, mishap or other occurrence in or about the Europa Center,whatever the cause. This shall include but not be limited to, the flooding of basements or other subsurface areas, and damage caused by refrigerators, sprinkling devices, air conditioning and/or electrical equipment,water, snow,frost, steam, excessive heat or cold,falling plaster, broken glass, sewage, gas, odors or noise or the bursting or leaking of pipes or plumbing fixtures, and shall apply equally whether any such damage results from the act or neglect of the Landlord, Avison Young - NC, LLC, other tenants, occupants or servants in the Building or any other person, and whether such damage be caused or result from any thing or circumstance above mentioned or referred to, or any other thing or circumstance whether of a like nature or of a wholly different nature. (b) Landlord's Release. Notwithstanding anything to the contrary contained in this Lease, Landlord hereby releases Tenant from any and all liability for loss or damage caused by fire or any of the extended Page 11 -THE EUROPA CENTER Lease Landlord Tenant Initials Initials 37 coverage perils coverable by the insurance required to be carried by Landlord in subsection 17(a) above, even if the insured peril shall be brought about by the default, negligence or other action of the Tenant, its agents, employees, invitees or any of them. (c) Tenant's Release. Notwithstanding anything to the contrary contained in this Lease, Tenant hereby releases Landlord from any and all liability for loss or damage coverable by the insurance required to be carried by Tenant in Section 18 above, even if the insured peril shall be brought about by the default, negligence or other action of the Landlord, its agents, employees, tenants, invitees or any of them. 20. EMINENT DOMAIN. if all of the Rented Space,or such part thereof as will make the same unusable for the purposes contemplated by this Lease, be taken under the power of eminent domain(or a conveyance in lieu thereof), then this Lease shall terminate as of the date possession is taken by the condemner,and rent shall be adjusted between Landlord and Tenant as of that date. If only a portion of the Rented Space is taken and Tenant can continue use of the remainder,then the Lease will not terminate, but rent shall abate in a just and proportionate amount to the loss of use occasioned by the taking. Tenant shall have no right or claim to any part of any award made to or received by Landlord for any taking and no right or claim for any alleged value of the unexpired portion of this Lease; provided, however, that Tenant shall not be prevented from making a claim against the condemning party (but not against Landlord)for any moving expenses, loss of profits, or taking of Tenant's personal property (other than its leasehold estate) to which Tenant may be entitled. In the event of a temporary taking of ninety(90)days or less, this Lease shall not terminate, but the term of this Lease shall be extended by the period of the taking and the rent shall abate in proportion to the area taken for the period of such taking. 21. UTILITIES AND OTHER SERVICES. (a) Standard Services. Landlord shall furnish: (1) Heat and/or air conditioning to maintain the Rented Space at a reasonably comfortable temperature from 6:00 a.m. until 11;59 p.m. on Monday through Friday and 8:00 a.m. until 8:00 p.m. on Saturdays and 12:00 p.m. on Sunday, except on New Year's Day, Memorial Day, Independence Day, Labor Day, Thanksgiving, and Christmas Day. (2) During the times specified in Subsection (a) above, Landlord shall furnish the Rented Space, at no cost to Tenant, with electricity and maintenance of building standard fluorescent lighting, composed of 2'x 4'fixtures. Incandescent fixtures, table lamps, all lighting other than the building standard fluorescent lighting, dimmers and all lighting controls other than controls for the aforesaid building standard fluorescent lighting shall be serviced and maintained by Tenant at Tenant's expense. Landlord shall also furnish the Rented Space, at no additional cost, with electricity for lighting other than the building standard fluorescent lighting and for the operation of general office machines, such as electric typewriters, dictating equipment,adding machines and calculators, and general service non-production type office copy machines. Landlord shall have the right to enter and inspect the Rented Space and all electrical devices therein from time to time with reasonable notice. (3) Elevator service in the Building. (4) Janitorial and cleaning services Monday through Friday of each week,except the holidays listed above. Landlord's cleaning service shall include emptying of normal office trash cans and disposing of their contents. Tenant shall dispose of all other refuse, boxes,cans, books,abandoned furniture and all other large, unusual or heavy items at Tenant's sole cost and expense and shall not permit the accumulation thereof in the Rented Space or elsewhere in the Building or at the Europa Center. It is understood that employees of Landlord are prohibited as such from receiving any packages or other articles delivered to the Building for Tenant and that, should any such employee receive any such packages or articles, he or she in doing so shall be the agent of Tenant and not of Landlord. Landlord shall not be liable in any way for any damage or inconvenience caused by the cessation or interruption of such heating,air conditioning,electricity, elevator, or janitor or cleaning service occasioned by fire, accident, strikes, break down, necessary maintenance,alterations, repairs, replacements,conduct of othertenants, requirements of public authority or causes beyond Landlord's control. (b) Extended Services. In the event that Tenant desires to utilize any of Landlord's services specified in this Section beyond the hours of permitted use, Tenant shall, prior to such use, request permission from the Landlord and obtain, in writing, signed by Landlord and Tenant, an agreement specifying the charge for such use to be paid by Tenant to Landlord and the time of such payment. in the event that Tenant makes any such use without such request and mutual agreement, then, and in such event, Tenant covenants and agrees to pay to Landlord for such use an amount determined by Landlord's selected engineer, upon demand. (c) Special Eguil2mentof Tenant. For computers and all other equipment requiring heavier than the normal office use of electricity, Tenant shall separately meter (or submeter, if approved by Landlord in writing), at its expense, the electricity serving such equipment and shall pay upon demand all costs to Landlord for such utility consumption; or, in the alternative, Tenant shall, prior to utilizing any such equipment, enter into a written agreement with Landlord specifying the charge for such use to be paid by Tenant to Landlord, the time of such payment and the method of determining increases from time to time as rates change or such use by Tenant is changed. In the event that Tenant makes any such use without such Page 12 -THE EUROPA CENTER Lease Landlord Tenant Initials Initials 38 request and mutual agreement, then, and in such event, Tenant covenants and agrees to pay to Landlord for such in an amount determined by Landlord's selected engineer, upon demand. Landlord may cause an electric check meter to be installed in the Leased Premises or cause a reputable independent electrical engineering or consulting firm to survey and determine the value of the electric service furnished for such excess electric current,the cost of either of which shall be paid by Tenant. Tenant shall be responsible for all repairs, maintenance, replacements and service to all equipment serving Tenant's computers and other special equipment, including without limitation HVAC equipment. Tenant covenants to pay for its electrical consumption referred to in this paragraph in a timely fashion,which covenant shall survive the expiration or earlier termination of this Lease as hereinafter provided. 22. COVENANT OF TITLE AND QUIET ENJOYMENT. Landlord covenants that it has full right and power to execute this Lease and to grant the estate demised in this Lease. The Landlord's title is and always shall be paramount to the title of the Tenant, and nothing herein contained shall empower the Tenant to do any act which can, shall or may encumber such title. Landlord also covenants that if Tenant promptly and punctually complies with each of its obligations hereunder, it shall peacefully have and enjoy the possession of the Leased Premises during the term of this Lease, provided that no action of Landlord in repairing or restoring the Rented Space or in working in other space in the Building, shall be deemed a breach of this covenant, 23. COMMON AREAS. (a) Nonexclusive Right of Use.Tenant shall have the right togetherwith other tenants and occupants and invitees to the non-exclusive use of the sidewalks, driveways, stairways, hails, lobbies, elevators and passages in the Building and at the Europa Center for reasonable ingress to and egress from the Rented Space, and for no other purpose, subject to the other provisions of this Lease, including without limitation the Rules and Regulations in Exhibit C. (b) Controlled Access. The Common Areas and roof are not for the use of the general public, and Landlord shall in all cases retain the right to control and prevent access thereto by all persons whose presence, in the judgment of Landlord, shall be prejudicial to the safety, character, reputation and interests of the Europa Center and its tenants. (c) Landlord's Right to Close or Alter. The Landlord reserves the right to use any portion of the Common Areas from time to time and/or to deny access to the same temporarily in order to repair, maintain or restore such facilities or to construct improvements under, over, along, across and upon the same, and to relocate such Common Areas, for the benefit of the Europa Center and its tenants. 24. USE OF PARKING FACILITIES. Subject to the other provisions of this Lease,Tenant shall have free non-exclusive use of parking facilities, driveways and islands for Tenant, Tenant's employees, Tenant's business invitees and Tenant's agents,from 6:00 a.m. through 11:00 p.m. each day of the week. Such areas for non-exclusive parking spaces shall serve all tenants, their employees, business invitees and agents; provided, however, that at no time during any day of the original or extended term of this Lease shall the aggregate number of non-exclusive parking spaces actually occupied by Tenant, Tenant's employees, business invitees and agents exceed 35 of the parking spaces on the site(which figure is a maximum number of spaces to be utilized by or for the Tenant at any one time, but Landlord in no respect guarantees that such number of spaces will in fact be available at any one time for the Tenant). Tenant shall upon written notice from Landlord,within five (5)days, furnish Landlord, or its authorized agent, the state motor vehicle license number assigned to each of its motor vehicles to be parked on the site and the motor vehicles of all of its employees employed in the Rented Space. Tenant shall not at any time park any trucks or any delivery vehicles in the parking areas or driveways, except as specifically designated by Landlord from time to time, and shall confine all truck parking, loading and unloading to times and locations specifically designated by Landlord from time to time. Tenant shall require all trucks servicing Tenant to be promptly loaded or unloaded and removed from the site. Landlord hereby reserves the exclusive right with respect to the use of parking facilities, roadways, sidewalks, driveways, islands and walkways for advertising purposes. Tenant covenants and agrees to enforce the provisions of this Lease against Tenant's employees and business invitees. Landlord may from time to time circulate free parking stickers for the purpose of identifying motor vehicles of Tenant and Tenant's employees and/or circulate free validation tickets for the purpose of identifying Tenant's business invitees. Landlord shall have the right, but not the obligation: (a)to police said parking facilities, (b) to provide parking attendants, (c) to cause unauthorized and/or unstickered motor vehicles to be towed away at the sole risk and expense of the owner of such motor vehicles, (d)to designate certain parking spaces to be for the exclusive use of the handicapped,for the exclusive use of certain tenants and/or for the exclusive use of visitors, (e)to use any portion of the parking facilities from time to time and/or to deny access to the same temporarily in order to repair, maintain or restore such facilities or to construct improvements, under, over, along, across and upon the same for the benefit of the site and to grant easements in the Parking facilities to public and quasi-public authorities and, (f)to adopt and modify from time to time rules and regulations for parking and vehicular ingress and egress,for traffic speed and flow and for times and places for move-ins, move-outs and deliveries. Page 13 -THE EUROPA CENTER Lease Landlord Tenant Initials Initials 39 25. INFORMATION CONCERNING TENANT. Tenant shall fUrnieh WithiR fiftaon(15)days after Feq poet effer,t that theFe either has or has net been aRy material adveFse GhaRge in the finanGial oand4ien ef TeRaRt SIRGe the date Gf the fiRaRGial statement submitted, and if SUGh GaFtifirsatieR states that theFe has beeR a 26. AUTHORITY OF TENANT. TeRaRt shall fuFRish tG LandleFd within fifteeR(15)days afteF request freF�R may FeaSE)Rably Fecluest in erder tn- n-P-Rfirrp that the and- delive-Fy ef this Lease has beeR GlUly authOFized byTenant aF4d that the persen(s)exeGUtiRg thiG Lease ep behalf efTenant were dUly allthE)Fized to pa Ffraer of Tenant 27. ESTOPPEL. Within ten(10)days after request therefore by Landlord, Tenant agrees to execute and deliver to Landlord a certificate prepared by Landlord to any proposed mortgagee, ground lessee or purchaser of the Europa Center or to Landlord certifying(if such is the case)that this Lease is in full force and effect,that there are no defenses or offsets thereto, or stating those claimed by Tenant, and such other facts related to this Lease, the Leased Premises or Tenant as Landlord may request. If Tenant does not execute and return such certificate as required above, Tenant hereby irrevocably appoints landlord as its attorney in fact to execute such certificate on behalf of Tenant. 28. RIGHT TO RELOCATE. (a) FeaseRable eest of moving fher,eafter Galled "Substitute SpaGe") ivith;R thP- &UlldiRg befeF8 the GeMMeRGeMeRt Date 9F at any time time,the Substitute Spa6e. ExGept as PFOVided on this SeGfien, LandleFd shall not be liable OF FespeRsible iR an way feF damages eF 'RjuFies SUffeFed by TeRaRt pursuant te the FeIGGatiOR in aGGOF(JaRGe with this SeGfieR, (b) I=and!eFd shall give TeRaRt at least sixty(60)days R9tiGe of its iRteRtiGR te Fe!9Gate Tenant AGtiG8, T-GRaRt shall have seveR (7) GalendaF days within whieh 19 aGeept.n wFiting the pFepesed Substitute this Lease shall teFMiRate at the �y#si (60) d.�ay �r II0Wi Rg the sep.iGe of F;efinn Gn the Tenant� f Substitute SpaGe as expeditieusly as possible so that i!is in substantially the same oeRdiWR that the Rented sGOR ras I andlerd's werks is substantially nramnleted , SpaGe. UPOR substantial Gempletien of the Substitute SpaGe, ihis Lease will apply to the Substitute Space as- 29. LANDLORD'S ACCESS TO RENTED SPACE. The Tenant shall permit the Landlord to erect, use and maintain pipes, ducts,wiring and conduits in and through the Rented Space. The Landlord or Landlord's agent shall have the right to enter upon the Rented Space,to inspect them, to perform janitorial and cleaning services and to make such repairs or alterations to the Rented Space or the Building as the Landlord may deem necessary or desirable, and the Landlord shall be allowed to take all material into and upon the Rented Space that may be required for repairs and alterations without the same constituting an eviction of the Tenant in whole or in part, and the rent reserved shall in no wise abate(except as provided in Section 17) while repairs and alterations are being made, by reason of loss or interruption of business of the Tenant, or otherwise. If the Tenant shall not be personally present to open and permit an entry into the Rented Space at any time when for any reason an entry into the Rented Space shall be necessary or permissible,the Landlord or Landlord's agents may enter the same by a master key, or may forcibly enter the same,without rendering Page 14 -THE EUROPA CENTER Lease Landlord Tenant Initials Initials 40 the Landlord or such agents liable therefore(if during such entry Landlord or Landlord's agents shall accord reasonable care to Tenant's property)and without in any manner affecting the obligations and covenants of this Lease. Nothing herein contained, however, shall be deemed or construed to impose upon the Landlord any obligations, responsibility or liability whatsoever, for the care, supervision or repair of the Building or any part thereof, other than as provided in this Lease. The Landlord shall also have the right at any time without the same constituting an actual or constructive eviction and without incurring any liability to the Tenant therefor, to change the arrangement and/or locations of entrances and passageways, doors and doorways, and corridors, elevators, toilets, parking areas and other Common Areas. The Landlord shall have the right to show the Rented Space to prospective new tenants during the last 120 days of the Term. The Landlord shall not be liable to the Tenant for any expense, injury, loss or damage resulting from work done in or upon,or the use of, any adjacent or nearby building, land, street or alley. 30. MANAGING AGENT. Landlord reserves the right to designate a Managing Agent and to delegate any or all of Landlord's powers, duties, obligations, or rights under this Lease to the Managing Agent. To the extent Landlord's duties or obligations under this Lease are assumed in writing by the Managing Agent, Landlord shall not be responsible for the assumed duties or obligations. Tenant's rights and obligations under this Lease shall not be affected by designation of a Managing Agent by the Landlord. 31. SUBORDINATION. This Lease is subject and subordinate to all security liens, mortgages, deeds of trust and related financing instruments which may now or hereafter affect the Europa Center or any part thereof, and to all renewals, modifications, consolidations, replacements, amendments and extensions thereof, unless Landlord or any lender secured by a mortgage, deed of trust or similar security instrument elects to make this Lease superior to same,which it may do at its option. Tenant shall execute within ten(10) days after request any certificate, subordination agreement, priority agreement or other form of instrument in confirmation of such subordinate or superior status that Landlord may request, including an agreement to attorn. Tenant hereby irrevocably appoints Landlord its attorney in fact to execute and deliver any such instrument on behalf of Tenant if Tenant fails or refuses to execute or deliver same as required by this Lease. Tenant shall also execute within ten(10)days after request an agreement with any lender pursuant to which Tenant agrees to give such lender a minimum period of sixty(60)days after Tenant's notice to such lenderfor the lender to cure Landlord's default prior to Tenant's terminating this Lease due to Landlord's default. 32. RESERVATION OF RIGHTS. Landlord hereby reserves to itself and its successors and assigns the following rights (all of which are hereby consented to by Tenant): (a) to change the street address and/or name of the Building and/or the arrangement and/or location of entrances, passageways, doors, doorways, corridors, elevators, stairs,toilets or other public parts of the Building; (b) to grant to anyone the exclusive right to conduct any particular business or undertaking in the Building; and (c) to construct future phases of the Europa Center attached to the Building. Landlord may exercise any or all of the foregoing rights without being deemed to be guilty of an eviction, actual or constructive, or a disturbance or interruption of the business of Tenant or Tenant's use or occupancy of the Leased Premises. 33. NOTICES. Any notices which Landlord or Tenant requires or desires to give to the other relating to this Lease or the Leased Premises must be in writing and shall be deemed sufficiently given and delivered if: (a) Hand-delivered to the following addresses: If to Landlord: Europa Center, LLC c/o Avison Young - NC, LLC 100 Europa Drive, Suite 190, Chapel Hill, NC 27517 If to Tenant: Orange County 100 Europa Drive, Suite 101, Chapel Hill, NC, 27517 -OR- (b) Sent by facsimile or email transmission to the following: If to Landlord: Europa Center, LLC c/o Avison Young - NC, LLC Facsimile No. (919) 929-7913 Sherry.alte-cook@avisonyoung.com If to Tenant: Page 15 -THE EUROPA CENTER Lease Landlord Tenant Initials Initials 41 (c) Send payment of monthly rent to the following address: Europa Center, LLC, c/o Avison Young - NC, LLC P.O. Box 900002, Raleigh, NC 27675-9000 Either party may change its designated facsimile number for receipt of notice by written notice to the other party pursuant to this Section 33. 34. ENTIRE AGREEMENT; MODIFICATION. This Lease contains the entire agreement of the parties in regard to the Leased Premises. There are no oral agreements existing between them and there shall be no oral changes. Neither Landlord nor any agent of Landlord has made any representations, warranties or promises with respect to the Rented Space,the Building or the Europa Center, or the use of any amenities or facilities,except as expressly set forth in this Lease. Any agreement made after this Lease is signed shall be ineffective to change,waive, modify, discharge, or terminate it in whole or in part unless such agreement is in writing and executed by both Landlord and Tenant. 35. RIDERS AND EXHIBITS. All riders and exhibits attached to this Lease and initialed by the Landlord and the Tenant are hereby made a part of this Lease as though inserted in this Lease. The following Exhibits are attached hereto and incorporated herein: Exhibit A Site of Europa Center Exhibit B Sketch of Rented Space Exhibit C Rules and Regulations 36. SECTION HEADINGS. The headings of sections are for convenience only and do not limit or alter the contents of the sections. 37. NUMBER AND GENDER. The words"Landlord"and "Tenant"wherever used in the Lease shall be construed to mean plural where necessary, and the necessary grammatical changes required to make the provisions hereof apply either to corporations, partnerships or individuals, men orwomen,shall in all cases be assumed as though in each case fully expressed. 38. GOVERNING LAW. This Lease shall be governed and construed pursuant to the laws of North Carolina. 39. SEVERABILITY. If any term, covenant or condition of this Lease or the application thereof to any person or circumstance shall, to any extent, be invalid or unenforceable,the remainder of this Lease shall not be affected thereby; and each term, covenant or condition of this Lease shall be valid and be enforced to the fullest extent permitted by law. 40. MODIFICATION BY MORTGAGEE. Should any mortgagee or ground lessee of Landlord require a modification or modifications of this Lease, which modification or modifications will not bring about any increased cost or expense to Tenant or in any other way substantially change the rights and obligations of Tenant hereunder, then Tenant shall execute a written modification to such effect within ten (10) business days of request by Landlord. 41. BINDING EFFECT. Each provision of this Lease shall extend to and shall bind and inure to the benefit of the Landlord and the Tenant and their respective heirs, legal representatives, successors and assigns. 42. LIMITATION ON RIGHT OF RECOVERYAGAINST LANDLORD. Tenant acknowledges and agrees that the liability of Landlord under this Lease shall be limited to its interest in the Europa Center and any judgments rendered against Landlord shall be satisfied solely out of the proceeds of the sale of its interest in the Europa Center. No personal judgment shall lie against Landlord upon extinguishment of its rights in the Europa Center and any judgment so rendered shall not give rise to any right of execution or levy against Landlord's assets. The provisions hereof shall inure to Landlord's successors and assigns, including any Mortgagee. The foregoing provisions are not intended to relieve Landlord from the performance of any of Landlord's obligations under this Lease, but only to limit the personal liability of Landlord in case of recovery of a judgment against Landlord; nor shall the foregoing be deemed to limit Tenant's rights to obtain injunctive relief or specific performance or to avail itself of any other right or remedy which may be awarded Tenant by law or under this Lease. 43. BROKERAGE. The Tenant and Landlord each represents to the other that it has dealt directly with and only with Pickett-Sprouse Commercial Real Estate and Avison Young - NC, LLC, as brokers in connection with this Lease, and that no other broker procured this Lease or is entitled to any commission in connection with the Lease, and in the event either party has hired another broker such hiring party shall Page 16 -THE LUROPA CENTER Lease Landlord Tenant Initials Initials 42 indemnify,defend and hold forever harmless the other party from and against any claim by such hired broker and from and against any and all costs directly or indirectly arising out of any such hiring. 44. CONFIDENTIALITY. The terms of this Lease are confidential. Neither Landlord nor Tenant shall disclose any terra of this Lease, including but not limited to any rental provision, to any third party; provided that Landlord shall have the right to disclose terms to a prospective or existing mortgagee, ground lessee or purchaser, and Tenant shall have the right to disclose terms to Tenant's bank, Tenant's accountants, Tenant's attorneys and other professional bound by an obligation of confidentiality to Tenant. Both parties shall require any such third parties to whom they disclose information regarding this Lease to keep the information confidential. IN WITNESS WHEREOF, Landlord and Tenant have duly executed this Lease,to be effective as of the date first stated above. LANDLORD: Europa Center, LLC herein represented by its duly authorized agent, Avison Young - NC, LLC, 100 Europa Dr., Suite 190, Chapel Hill, NC 27517 Attest: John P. Graham, Principal TENANT: Orange County, a North Carolina political subdivision Attest: By: Bonnie B. Hammersley, County Manager Page 17 -THE EUROPA CENTER Lease Landlord Tenant Initials Initials 43 EXHIBIT A SITE OF THE EUROPA CENTER Attached to and Made Part of Lease for Orange County, a North Carolina political subdivision Beginning at a point in the western right of way line of Europa Drive where said point intersects with the southern right of way line of U.S. Highway 15-501 Service Road; thence along said western right of way line of Europa Drive in a southeasterly direction four(4)calls as follows: (1)South 13 20=51 @ East 70.68 feet to a point; (2) South 05 11=27@ East 121.49 feet to a point; (3) along a curve to the left having a radius of 755.00 feet, a total arc distance of 468.67 feet to a point; (4) South 41 42=17@ East 121.01 feet to a point where the western right of way line of Europa Drive intersects with the northern right of way line of Legion Road; thence along the northern right of way line of Legion Road in a southwesterly direction two(2)calls as follows: (1)along a curve to the left having a radius of 4,492.86 feet,an arc distance of 278.96 feet to a point; (2)along a curve to the left having a radius of 1,236.05 feet, an arc distance of 225.42 feet to a point in the property line of now or formerly GDJ Coggin Partnership; thence along said Coggin line two (2) calls as follows:(1)North 61 10=20@ West 223.32 feet to a point; (2)North 00 59=15@ East 596.46 feet to a point in the property line of now or formerly McDonald=s Corporation;thence along said McDonald=s line two(2)calls as follows: (1)North 51 01=45@ East 209.48 feet to a point;(2)North 01 00=52= East 181.55 feet to a point in the southern right of way line of U.S. Highway 15.501 Service Road; thence along said right of way line three(3)calls as follows: (1)North 50 36=56@ East 4.54 feet to a point; (2)along a curve to the right having a radius of 120.0 feet,an arc distance of 71.30 feet to a point;(3)North 84 52=22@ East 29.97 feet to a Point and Place of Beginning and being all of Europa Center according to survey entitled AAs Built Survey of Europa Center, Chapel Hill, Orange Co., North Carolina@ dated 15 December 1988 and prepared by Murphy Yelle Associates Registered Land Surveyors, Raleigh N.C., and being the same property conveyed to North Carolina Office Company by deed November 12, 1984 recorded in Book 491, Page 173, Orange County Registry. Page 18 -THE EUROPA CENTER Lease Landlord Tenant Initials Initials 44 EXHIBIT B SKETCH OF RENTED SPACF jo {... q \ � Suite 101 10,615 sf in Page 19 -THE EUROPA CENTER Lease Landlord Tenant Initials Initials 45 EXHIBIT C RULES AND REGULATIONS Attached to and Made Part of Lease for Orange County, a North Carolina political subdivision 1. The Tenant shall not use the name of the Building, the Europa Center, or any future designation of any of these,for any purpose other than that of business address of the Tenant, and shall never use any picture or likeness of the Building or the Europa Center in any circulars, notices, advertisements or correspondence without the Landlord's express consent in writing. Tenant shall not use the name of the Landlord for any reason without the Landlord's written consent. 2. The entrances, lobbies and other Common Areas shall be under the exclusive control of Landlord and shall not be obstructed or used for any purpose other than ingress and egress. 3. Tenant shall not bring into the Building or operate therein any engine, boiler,dynamo or machinery of any kind, or carry on any mechanical operations in the Premises, or place any explosive therein, or use any kerosene, oils or burning fluids therein, without first obtaining in each and every instance the prior written consent of Landlord. 4. The Rented Space shall not be used for the purpose of lodging or sleeping rooms, nor in any way to damage the reputation of the Building;and Tenant shall not disturb or permit the disturbance of other tenants of the Building by the use of musical instruments or other noises, odors, canvassing of any occupant of the Building, failing to maintain order in the Building, or by any other interference whatsoever. 5. The Tenant shall not install any musical instrument or equipment in the Building or any antennae, aerial wires or other equipment inside or outside the Building, without, in each and every instance, prior written approval by Landlord. The use thereof, if permitted, shall be subject to control by the Landlord so that others shall not be disturbed or annoyed. 6. Landlord shall reserve the right to exclude or eject from the Building animals of every kind,bicycles,and all canvassers and other persons who conduct themselves in such a manner as to be, in the judgment of Landlord, an annoyance to the Tenants or a detriment to the Rented Space. 7. The toilet rooms, water closets and other water apparatus shall not be used for any purpose other than those for which they are intended. Tenant shall not waste water in any manner whatsoever, including without limitation the tying, wedging or otherwise fastening open any faucet. The cost of repair of any damage resulting from misuse or abuse by Tenant, its employees or guests, shall be borne by Tenant. 8. The Tenant shall not place or allow anything to be against or near the glass of partitions, doors, or windows of the Rented Space which may diminish the light in,or be unsightly from,the exterior of the Building or any Common Areas. If there are any glass entry doors to the Rented Space, Tenant must obtain Landlord's prior written approval, which Landlord may give or withhold in its sole discretion, of all furniture, interior finishes and other objects visible through such glass door(s). Shades, draperies or other forms of inside window covering, if not so provided by Landlord, must be of such shape, color, and materials as are approved by Landlord in writing prior to installation. 9. if Tenant desires a safe for depositing of valuables or securities, Landlord shall have the right to prescribe its weight, size and proper position. Nothing whatsoever shall be brought into the Building by Tenant, its agents,employees,or visitors which has a weight of more than 200 pounds per square foot, unless Landlord approves same and its proper positions. 10. If Tenant desires telegraphic,telephonic, burglar alarm or signal service,the Landlord will,upon request, direct where and how connections and all wiring for such service shall be introduced and run. Without such direction, no boring, cutting or installation of wires or cables is permitted. 11. Two keys to the front door of the Building will be provided at no cost. A reasonable number of additional keys will be provided upon payment of fees therefore. No locks shall be placed upon any doors of the Rented Space without first obtaining the written consent of Landlord and furnishing Landlord with keys to same. Tenant will not permit any duplicate keys to be made(all necessary keys to be furnished by Landlord). Upon termination of this Lease, Tenant shall surrender to Landlord all keys. Tenant shall notify Landlord immediately if Tenant loses any keys to any entry door of the Building. Tenant shall pay all costs incurred by Landlord as a result of such loss, including but not limited to the cost of re-keying any door(s)and providing new keys to existing Tenants of the Building. Page 20 -THE EUROPA CENTER Lease Landlord Tenant Initials Initials 46 12. The Tenant shall be responsible for the locking of doors in and to the Rented Space. Any damage resulting from neglect of this obligation shall be paid by Tenant. 13. All persons entering or leaving the Building may be required to identify themselves to watchman by registration or otherwise, and to establish their right to enter or leave the Building. 14. No person or persons, other than employees of the Building, shall be employed by Tenant for the purpose of cleaning or taking care of the Rented Space without the written consent of Landlord. Any person or person so employed by Tenant(with the written consent of Landlord) shall be subject to and under the control and direction of, Landlord in the use of the Building and its facilities. 15. Landlord reserves all vending rights. 16. No part of the Building shall be used or in any way appropriated for gambling, immoral or other unlawful practices, and no intoxicating beverages or liquors shall be sold in Building. 17. The Tenant shall not do or permit to be done in the Rented Space or at the Europa Center, or bring or keep anything in or on the Rented Space of the Building, which shall in any way increase the rate of fire insurance on the Building, or on the property kept in the Building, or obstruct or interfere with the rights of other Tenants or in any way injure or annoy them, or conflict with the laws relating to fires, or with the regulations of the Fire Department, or any part of these laws, or conflict with any rules and ordinances of the Board of Health. 18. Tenant shall not, without Landlord's prior written consent, after full disclosure, keep, use, store, or dispose of,substances designated as or containing components designated as hazardous,dangerous,toxic or harmful and/or subject to regulation under any federal, state or local law, regulation or ordinance, on or around the Rented Space. 19. Concealed weapons are strictly prohibited. 24. Security access cards remain the property of the Landlord and shall be used as prescribed by Landlord. Page 21 -THE EUROPA CENTER Lease Landlord Tenant Initials Initials