Loading...
HomeMy WebLinkAboutAgenda - 10-18-2022; 8-h - Inspection Period Extension for the Executed Lease Agreement with Well Dot, Inc. 1 ORANGE COUNTY BOARD OF COMMISSIONERS ACTION AGENDA ITEM ABSTRACT Meeting Date: October 18, 2022 Action Agenda Item No. 8-h SUBJECT: Inspection Period Extension for the Executed Lease Agreement with Well Dot, Inc. DEPARTMENT: Economic Development, County Manager's Office, County Attorney's Office, & Asset Management Services ATTACHMENT(S): INFORMATION CONTACT: 1) May 24, 2022 Agenda Abstract: Travis Myren, Deputy County Manager, Public Hearing Regarding Proposed (919) 245-2308 Lease Agreement and Economic Steve Brantley, Economic Development Development Incentive Agreement Director, (919) 245-2326 for Well Dot, Inc. Steve Arndt, Asset Management 2) Signed Lease Agreement between Director, (919) 245-2658 Orange County & Well Dot, Inc. 3) Lease Agreement Amendment Letter PURPOSE: To consider extending the 120-day inspection period contained in the lease agreement between the County and Well Dot, Inc. by 45 days to accommodate additional groundwater testing. BACKGROUND: Well Dot, Inc. has an existing office location in Orange County at 419 W. Franklin St., Chapel Hill, highlighted in red on the map below, which will accommodate up to 85 employees in senior management. To house an additional 300+ jobs Well Dot plans to hire through 2025, a second location was needed in downtown Chapel Hill. The Company identified the County's former Visitors Bureau building and the adjacent space previously occupied by the Skills Development Center as its desired location. These properties, highlighted in purple on the map below, are located at: • 501 W. Franklin Street, Chapel Hill, NC 27517 (PIN) 9788151996 • 503 W. Franklin Street, Chapel Hill, NC 27517 (PIN) 9788151829 • 108 S. Roberson Street, Chapel Hill, NC 27517 (PIN) 9788152822 2 � 3 .fit oero 4% r c`<-. •2. r 7 At its May 24, 2022 Business meeting, the Orange County Board of County Commissioners held a public hearing and approved a performance-based economic development incentive agreement and a lease agreement between Orange County and Well Dot, Inc. The lease agreement for the properties outlined a 120-day inspection period for the company to conduct due diligence on the site and facilities. That inspection period was set to expire on October 6, 2022. On September 21, 2022, Well Dot, Inc. communicated some potential findings from its initial Phase 1 due diligence that required a Phase 2 assessment to be completed. On October 4, 2022, Well Dot, Inc. received the results of the Phase 2 testing indicating potential site issues and that further testing of the groundwater on the premises would be needed by Well Dot, Inc. to determine if environmental issues would need to be resolved prior to use. To that end, Well Dot, Inc. submitted a signed Letter Agreement (Attachment 3) requesting an extension of the inspection period by 45- days, proposing a new expiration date of November 21, 2022. FINANCIAL IMPACT: There is no financial impact associated with this item. SOCIAL JUSTICE IMPACT: The following Orange County Social Justice Goal is applicable to this item: • GOAL: ENSURE ECONOMIC SELF-SUFFICIENCY The creation and preservation of infrastructure, policies, programs and funding necessary for residents to provide shelter, food, clothing and medical care for themselves and their dependents. ENVIRONMENTAL IMPACT: There is no direct Orange County Environmental Responsibility Goal impact associated with this item. RECOMMENDATION(S): The Manager recommends that the Board approve the 45-day extension of the inspection period as outlined in the attached Lease Agreement Amendment Letter (Attachment 3) and authorize the Chair to sign the Agreement. 3 ORANGE COUNTY BOARD OF COMMISSIONERS ACTION AGENDA ITEM ABSTRACT Meeting Date: May 24, 2022 Action Agenda Item No. 5-a SUBJECT: Public Hearing Regarding Proposed Lease Agreement and Economic Development Incentive Agreement for Well Dot, Inc. DEPARTMENT: Economic Development, County Manager's Office, County Attorney's Office, & Asset Management Services ATTACHMENT(S): INFORMATION CONTACT: 1) Resolution with Lease Agreement Travis Myren, Deputy County Manager, between Orange County & Well (919) 245-2308 Dot, Inc. Steve Brantley, Economic Development 2) Performance Agreement between Director, (919) 245-2326 Orange County & Well Dot, Inc. Steve Arndt, Asset Management 3) Company Summary PowerPoint Director, (919) 245-2658 4) Public Hearing Media Notice 5) PowerPoint Presentation for the Public Hearing PURPOSE: To: 1) Receive and hold a public hearing on the proposed lease agreement and issuance of a "performance-based" economic development incentive by the County to a private company; and 2) Consider adopting a resolution authorizing approval of the proposed lease agreement and economic incentive agreement, with claw-back provisions, for the expansion of Well Dot, Inc.'s health care IT operations in Orange County, NC. BACKGROUND: Local and state governments in North Carolina have the goal to promote economic development by encouraging the location of new businesses and the expansion of existing businesses. This activity serves to diversify the local tax base, increase employment opportunities and introduce desired job skills and related benefits to a community, and for the benefit of its residents. The Local Government Act, North Carolina General Statute (NCGS) 158- 7.1, outlines the requirements of public hearings, and NCGS 158-7.1(a) specifically addresses the requirement that economic development appropriations "must be determined by the governing body of the city or county to increase the population, taxable property, agriculture industries, employment, industrial output, or business prospects of the city or county". This public hearing has been scheduled in compliance. 4 Well Dot, Inc. is an early-stage healthcare technology and services company that incorporated in January 2019. The company provides technology-enabled healthcare solutions to consumers via employers through a platform that enables consumers to navigate their health and wellness needs. Well Dot's current client portfolio includes firms such as the Bank of America, LabCorp, Extended Stay Hotels, FEDEX and Walmart. During the second quarter of 2019, Well Dot approached the Town of Chapel Hill and Orange County and expressed a desire to expand operations in either Chapel Hill, NC or Boston, MA, where the company also has an existing presence. On November 19, 2019, North Carolina Governor Roy Cooper, joined by company representatives and local, county and state elected officials, announced the location of a new operations center in Chapel Hill. The Chapel Hill center will serve as the primary center for clinical and health experts, while also housing software developers, data analysts and corporate personnel. The North Carolina Department of Commerce committed $3,394,500 over 12 years through a performance-based agreement with the Job Development Invest Grant (JDIG) program. Over the course of the 12-year term of that grant, the project is estimated to grow the state's economy by $609 million. The North Carolina Community College System also committed to supporting the company with $480,000 in value through its Customized Training Program. The Company will create at least 360 new full time jobs, at an annual rate of$63,665 plus benefits. Well Dot's salary average is higher than the 2022 Orange County average private sector wage of $59,026 per year. Other economic benefit multipliers to the County include additional daytime workers in downtown Chapel Hill, and enhanced job skills for those employees through customized training to be provided by the Orange County campus of Durham Technical Community College in Hillsborough. Also, construction employment for the facility upfit and remodeling will create additional skilled trade jobs. On March 4, 2020 the Chapel Hill Town Council approved a performance based incentive agreement with a maximum investment of $900,000, with $450,000 tied to job creation and $450,000 in parking credits, payable over 8 years. The town's incentive program will be awarded based on the company meeting specific targets for new jobs. Well Dot has an existing office location in Orange County at 419 W. Franklin St., Chapel Hill, highlighted in red on the map below, which will accommodate up to 85 initial employees in senior management. To house an additional 300+ jobs Well Dot plans to hire through 2025, a second location is envisioned nearby in downtown Chapel Hill. Therefore, the Company has identified the County's former Visitors Bureau building and the adjacent space previously occupied by the Skills Development Center as its desired and ideal location. These properties, highlighted in purple on the map below, are located at: • 501 W. Franklin Street, Chapel Hill, NC 27517 (PIN) 9788151996 • 503 W. Franklin Street, Chapel Hill, NC 27517 (PIN) 9788151829 • 108 S. Roberson Street, Chapel Hill, NC 27517 (PIN) 9788152822 5 N �. p � 1 On January 21, 2020 the Board of County Commissioners (BOCC) approved the relocation of both the Skills Development Center and Visitors Bureau from the existing Franklin Street location. In March 2020, the Skills Development Center moved its operations to the Europa Center in Chapel Hill. The BOCC has since approved locating the Skills Development Center into the 203 South Greensboro, Carrboro facility when it is completed. The Visitors Bureau has also relocated its operations to 308 West Franklin Street in Chapel Hill. For these reasons the properties to be leased are not needed for Orange County operations during the term of the Lease. FINANCIAL IMPACT: The economic development considerations for this project are contained in two agreements. The first is a lease agreement with Well Dot, Inc. that provides favorable short term lease terms to the Company with options to purchase during the course of the lease. The lease relieves the County of any ongoing maintenance or operating expenses during its term. The second is a performance agreement that would provide initial funding to upfit the space based on employment and wage targets. Lease Agreement The initial lease is for a term of ten (10)years. The lease allows for an extension for two additional five year periods with mutual consent. The company may exercise an option to purchase the facility each year on the anniversary date of the lease agreement. The purchase price will be determined according to the appraised value of the property at the time of purchase less the value of the initial deposit and rent paid up to the date of closing. According to the financial terms of the lease, Well Dot would make a non-refundable, initial deposit of $250,000 to the County. The company would then make monthly rent payments totaling $404,576.04 annually to the County for the first six years of the lease. Beginning in year seven, the rent would be adjusted to market rate based on prevailing commercial lease rates at that time. This provides an incentive for Well Dot to exercise the option to purchase on or before the seventh year of the lease. Annual rent increase of two percent (2%) would begin in year eight. Any renewal will reflect similar base rental fees and increases. 6 Year Payment Due 1 $250,000 initial deposit 1 $404,576 2 $404,576 3 $404,576 4 $404,576 5 $404,576 6 $404,576 7 Market Rent Established 8 2% Increase 9 2% Increase 10 2% Increase Based on current commercial rates, the market rent for the facility would total approximately $850,000 annually. If the company continues to rent the facility for the ten year lease term, the County will have collected approximately $6.2 million in lease revenue. If the company exercises the option to purchase during the term of the lease, it will pay property taxes starting at approximately $85,000 annually and increasing according to market value following each revaluation. Performance Agreement The performance agreement between Orange County and Well Dot, Inc. offers up to to $2 million for the company to use to offset facility development and remodeling costs. The payment would be based on actual expenditures incurred by the company and will be paid over a period of not more than two (2) years from the first installment. These funds would be borrowed with an average annual debt service payment of approximately$137,000. Proceeds from the lease would be used to pay the debt. As part of the performance agreement, the company agrees to create at least 360 new full time jobs, at an annual salary of $63,665 plus benefits. If job creation targets are not met, penalties of $500 per job will accrue annually and will be added to the purchase price of the facility. SOCIAL JUSTICE IMPACT: The following Orange County Social Justice Goal is applicable to this item: • GOAL: ENSURE ECONOMIC SELF-SUFFICIENCY The creation and preservation of infrastructure, policies, programs and funding necessary for residents to provide shelter, food, clothing and medical care for themselves and their dependents. ENVIRONMENTAL IMPACT: There is no direct Orange County Environmental Responsibility Goal impact associated with this item. RECOMMENDATION(S): The Manager recommends that the Board- 1) oard:1) Receive the proposal to consider entering a lease agreement and the issuance of incentives to a private company for the recruitment & expansion of Well Dot, Inc.'s operations in Orange County; 2) Open and conduct the Public Hearing and receive BOCC and public comments; 3) Close the Public Hearing; and 4) Approve the "performance-based" economic development incentive agreement and the lease by adopting the resolution authorizing the lease between Orange County and Well 7 Dot, Inc., each subject to final review by the County Attorney, and authorize the Chair to sign the resolution, the agreement and the lease on behalf of the County. 8 LEASE PROVISIONS TERM SHEET TYPE OF LEASE: B New ❑ Renewal ❑ Expansion ❑ Option ❑ Change/Adj. BUSINESS NAME: WELL DOT, Inc. TENANT: WELL DOT, Inc. ADDRESS: 419 W. Franklin Street, Chapel Hill NC 27516 (0) (415) 216-8434 (e-mail)jared.sokolsky@well.co PROPERTY ADDRESS: 501 W. Franklin Street 503 W. Franklin Street 108 S. Roberson Street Chapel Hill, NC 27517 LANDLORD: Orange County, a Political Subdivision of the State of North Carolina NOTICE ADDRESS: Orange County, Asset Management Services P.O. Box 8181 Hillsborough, NC 27278 RENT PAYMENTS : Orange County, Finance and Administrative Services P.O. Box 8181 Hillsborough, NC 27278 LEASE TERM: Ten (10)Years RENT PSF: $18.72 RENTABLE SQ. FTG: 21,612 LEASE SIGNED: $2022 INSPECTION PERIOD: 120 days. COMMENCEMENT DATE: The date of Substantial Completion (as hereinafter defined). RENT COMMENCES: Commencement Date LEASE EXPIRES: 120 months from Commencement Date MONTHLY BASE RENT: $33,714.67 ANNUAL BASE RENT: $404,576.04 RENT ADJUSTMENTS: No adjustment for the first six (6) Lease Years (as hereinafter defined). An annual fixed increase of Two percent(2%)to the Base Rent starting with the seventh (7th) Lease Year, subject to the reset of Base Rent provided for in Section 4(b) below. 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 beyond the expiration of any applicable notice and cure period, at the end of the initial ten-year Lease Term,this Lease may be extended for Two(2) terms of five(5)years each, commencing at the expiration of the initial term or prior extension term, as applicable,with Ninety(90) days prior written notice, and upon mutual consent. OPTION TO PURCHASE: Provided the Tenant is not in default of any terms of this Lease beyond the expiration of any applicable notice and cure period, the Tenant shall have the option to purchase the Property, which option may be exercised on any anniversary of the Commencement Date annually during the first 120-month term of the Lease. Should the option on the Property be exercised, the purchase price shall be based on appraisals using income methodology with each party selecting an independent appraiser and negotiating any differences in the appraisals to arrive at a purchase price, but shall also be less the value of the initial$250,000 deposit and rent paid up to the date of closing. Further, Landlord and Tenant are parties to that certain Performance Agreement dated as of the date hereof (the"Incentive Agreement"). The final purchase price for the Property shall be subject to any adjustments required by Section 2(D) of the Incentive Agreement. ALL RENTS ARE DUE ON THE 1st DAY OF EACH MONTH: Any payment not received by the 51h of the month will incur an automatic late fee of Five (5%) percent. DEPOSIT: Tenant shall pay a one-time deposit. The amount of the deposit shall be equal to the full amount expended by Landlord to up-fit the Orange County Skills Development Center up to and not to exceed two hundred fifty thousand dollars ($250,000.00). Such deposit shall not be refundable and may only be utilized as provided in this paragraph, but shall be applied to the purchase price of the Property in the event that Tenant elects to exercise the option to purchase the Property set forth herein. PAID BY LANDLORD: N/A Lanlord Tenant Initials Initials 9 PAID BY TENANT: Property Taxes, Insurance, Exterior\Maintenance, Parking Area Maintenance,All Utilities including \Electrical,Water&Sewer)\, Security, Management, HVAC Maintenance,Janitorial,Trash Removal and Extermination, Fire & Extended Coverage Insurance for tenant contents, Commercial General Liability Insurance for Tenant, and all telephone, cable, internet, etc. installation costs and monthly service charges. It is the intent of this Lease that all costs related to the Property shall be paid by Tenant. 4W Landlord Tenant Initials Initials 10 RENT SUMMARY (Tenant) 21,612 (Sq. Ft) Months below measured from Commencement Date Term Year #of Months Start Date End Date SF $Month Total $ 1 12 Month 1 Month 12 21,612 33,714.67 404,576.04 2 12 Month 13 Month 24 21,612 33,714.67 404,576.04 3 12 Month 25 Month 36 21,612 33,714.67 404,576.04 4 12 Month 37 Month 48 21,612 33,714.67 404,576.04 5 12 Month 49 Month 60 "21,612 33,714.67 404,576.04 6 12 Month 61 Month 72 ^21,612 33,714.67 404,576.04 7 12 Month 73 Month 84 "21,612 8 12 Month 85 Month 96 21,612 9 12 Month 97 Month 108 21,612 10 12 Month 109 Month 120 21,612 Term Year #of Months Start Date End Date SF $Month Total $ Op 1-1 12 Month 121 Month 132 21,612 Op 1-2 12 Month 133 Month 144 "21,612 Op 1-3 12 Month 145 Month 156 21,612 Op 1-4 12 Month 157 Month 168 21,612 Op 1-5 12 Month 169 Month 180 21,612 60 Term Year #of Months Start Date End Date SF $Month Total $ Op 2-1 12 Month 181 Month 192 21,612 Op 2-2 12 Month 193 Month 204 21,612 Op 2-3 12 Month 205 Month 216 21,612 Op 2-4 12 Month 217 Month 228 21,612 Op 2-5 12 Month 229 Month 240 21,612 60 * Subject to adjustment based upon Section 4(b) below. MAKE RENT PAYMENTS TO: Orange County Finance and Administrative Services P.O. Box 8181 Hillsborough, NC 27278 & — _-K Landlord Tenant Initials Initials 11 CONTENTS OF LEASE BY SECTION SECTION NUMBER AND SUBJECT Lease Provisions Information Rent Summary Contents of Lease 1. Definitions 2. Demise 3. Term 4. Rent 5. Late Payment 6. Deposit 7. Use of Leased Premises 8. Signs 9. Care and Maintenance 10. Alterations by Tenant 11. Acceptance of Leased Premises 12. Delay in Commencement 13. Subleasing and Assignment 14. Default 15. Holding Over 16. Surrender of Rented Space 17. Damage to Rented Space or Building 18. Tenant's Indemnity and Tenant's Insurance 19. Tenant's Waiver of Claim; Mutual Releases 20. Eminent Domain 21. Utilities and Other Services 22. Covenants of Title and Quiet Enjoyment 23. Inspection Period 24. Use of Parking Facilities 25. Information Concerning Tenant 26. Authority of Tenant 27. Estoppel 28. Right to Relocate 29. Landlord's Access to Rented Space 30. Managing Agent 31. Subordination 32. Reservation of Rights 33. Notices 34. Entire Agreement; Modification 35. Riders and Exhibits 36. Section Headings 37. Number and Gender 38. Governing Law 39. Severability 40. Modification by Mortgagee 41. Binding Effect 42. Limitation on Right of Recovery 43. Brokerage 44. Memorandum 45. Force Majeure 46. Taxes 47. Counterparts 48. Miscellaneous EXHIBITS EXHIBIT A-Site of Property EXHIBIT B-Sketch of Rented Space EXHIBIT C-Memorandum of Lease Landlord Tenant Initials Initials 12 LEASE This lease (the "Lease") is made as oeaCndlord 2022 by and between Orange County, a political Subdivision of the State of North Carolinandlord") and WELL DOT, Inc. ("Tenant"). In consideration of the reciprocal obligations stated herein, 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 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) "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. (d) "Lease Year": each twelve (12) month period of the Term beginning with the Commencement Date (or anniversary thereof) and ending on the subsequent anniversary of the Commencement Date. The first Lease Year shall begin on the Commencement Date and shall end on the immediately prior to the first anniversary of the Commencement Date. (e) "Leased Premises": the Property, including the Rented Space. (f) "Property": those tracts of land located at 501 W. Franklin Street,503 W. Franklin Street, and 108 S. Roberson Street in Chapel Hill Township, Orange County, North Carolina, described in Exhibit A attached hereto and incorporated herein, and all improvements situated thereon. (g) "Rentable Square Feet": the useable square feet of any area. (h) "Rented Space": that office space area shown as the cross-hatched area on Exhibit B attached hereto and incorporated herein,which consists of approximately 21,612 Rentable Square Feet and the entirety of each tract of land making up the Property. (i) "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. (a) Term. The term of this Lease shall commence on the Commencement Date. The term shall terminate at 11:59 P.M. on the date that is one hundred twenty(120) months following the Commencement Date, 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 beyond the expiration of any applicable notice and cure period, at the end of the initial ten-10 year Lease Term, this Lease may be extended for Two (2)terms of Five (5) years 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. Such Option to Renew must be agreed to in writing by both parties and is subject to the terms of North Carolina General Statute 160A-272. (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. (d) Option to Purchase. Provided the Tenant is not in default of any terms of this Lease beyond the expiration of any applicable notice and cure period, the Tenant shall have the option to purchase the Property, which option may be exercised on any anniversary date of the Commencement Date annually during the first 120-month term of the Lease. Tenant shall provide written notice to Landlord of its intent to exercise the option to purchase. (i) If the option to purchase is exercised, Landlord (seller) shall convey marketable fee- simple title to the described portion of the Property, and this conveyance shall be subject to no exceptions or encumbrances of record other than those (i) existing as of the effective date of this Lease, or(ii) which are approved by Tenant, such approval not to be unreasonably withheld. All closing costs related to the transfer of the Property shall be paid by the Tenant (buyer), except that the Landlord shall be responsible for andlord Tenant Initials Initials 13 attorneys'fees for any attorneys representing Landlord. Tenant shall be responsible for all funds required to satisfy and cancel any assessments, judgments, liens, deeds of trust, or other financial encumbrances against the Property and the described portion of the Property save and except any such encumbrances incurred by the Landlord. (ii) If the option to purchase is exercised, Landlord shall credit against the purchase price the amount of the Deposit and the amount of Rent paid by Tenant to Landlord up to the date of the closing. (iii) This option to purchase is contingent upon and subject to the following terms and conditions: This option to purchase shall commence on the date of the full execution of this Lease and shall continue through the end of the initial 120-month term thereof. The purchase price shall be based on appraisals using income methodology with each party selecting an independent appraiser and negotiating any differences in the appraisals to arrive at a purchase price, but shall also be less the value of the initial $250,000 deposit and rent paid up to the date of closing. If the option to purchase is exercised by the Tenant the sale of the described portion of the Property shall occur within sixty(60) days after the date of the option to purchase notice. 4. RENT. (a) Initial Annual Base Rent. Tenant shall pay to Landlord annual base rent in the amounts set forth in the Rent Summary set forth hereinabove (during the first six(6) Lease Years) and pursuant to Section 4(b) below thereafter. For each succeeding Lease Year of the Term and any optional extensions, Tenant shall pay to Landlord annual base rent as determined pursuant to this schedule and 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: Orange County, Finance and Administrative Services, P.O. Box 8181 Hillsborough, NC 27278, or at such other place as Landlord may designate from time to time in writing. (b) Annual Base Rent after Sixth Lease Year. In the event that Tenant has not elected to purchase the Premises pursuant to Section 3(d) above, within one hundred eighty (180) days prior to the commencement of the seventh (7th) Lease Year, Landlord and Tenant shall work together diligently and in good faith to determine the fair market rental value of the Premises for the seventh (7th) Lease Year,with the parties to select a commercial property broker with at least 10 years' relevant experience in the Chapel Hill market area. In the event that the parties cannot agree upon a commercial property broker for such determination,they shall each select a commercial property broker with at least 10 years' relevant experience in the Chapel Hill market area, and the rent shall be the average of the good faith determination made by both such brokers. The parties shall then enter into an amendment to this Lease setting forth the annual base rent for the seventh (7th) Lease Year, which annual base rent shall thereafter escalate by two percent (2%) per annum at the beginning of each further Lease Year thereafter. (c) Base Rent for Partial Month. Base rent due for any partial month at the beginning of the Term shall be $1,108.41 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-day year. (d) Intentionally omitted. (e) Intentionally omitted. (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 may be exercised cumulatively with Landlord's rights and remedies under Section 14 below. 6. DEPOSIT. Within ten (10) business days following the expiration of the Inspection Period, Tenant shall pay to Landlord the sum of two hundred fifty thousand dollars($250,000.00) as a deposit. The deposit, Landlord — Teirant-- Initials Initials 14 once made, is non-refundable. The equivalent value of such deposit shall be applied to the purchase price for the Property if Tenant exercises its purchase option set forth herein. In the event that Tenant terminates this Lease during the Inspection Period, Tenant shall have no obligation with respect to the deposit. 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 priorwritten consent,such consent not to be unreasonably withheld, conditioned or delayed. 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 all ordinances and regulations of governmental authorities applicable to the Leased Premises. 8. SIGNS. Tenant shall be solely responsible for all signage at the Property. This includes, but is not limited to, approvals, cost, installation, maintenance, and repair. 9. CARE AND MAINTENANCE. Subject to the provisions of Section 29, Tenant shall, at the Tenant's own expense, keep the Rented Space and Property in good condition and shall pay for the repair of any part of the Property that needs repair due to wear and tear or damages caused by third parties or 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. Landlord is not responsible for maintenance. Tenant is responsible for all maintenance of interior and exterior spaces, structure and structural areas, walls, floors, roof, plumbing, heating and air, and electrical systems. It is the intent of this Lease that Tenant have full responsibility for all maintenance and care of the Property and all Buildings thereon. 10. ALTERATIONS BY TENANT. (a) Requirements. Tenant is responsible for all up-fit costs and construction. The Tenant shall furnish to the Landlord before commencement of the work or delivery of any materials to the Property 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 (vi) 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. Landlord shall not unreasonably withhold, condition or delay its approval of any alterations, up-fit, or improvements requested by Tenant, and shall respond to Tenant within fifteen (15) days of receipt of any requests for such approval with either its approval or with detailed comments on the reasons for its disapproval, with Tenant being permitted to modify its plans and specifications and re-submit the same for further approval. Notwithstanding the foregoing, without Landlord's consent, Tenant may make interior changes and alterations to the Premises that(i)do not affect the structural integrity of the improvements, (ii) do not materially reduce the market value of the Premises, and (iii)do not cost more than$100,000.00 in total during any Lease Year. (b) Liabilit . Regardless of who performs any alterations, up-fit, and remediation 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, up-fit, and remediation. Any mechanic's lien filed against the Rented Space or the Property 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 completion of such work, Tenant shall furnish Landlord with contractors' affidavits, full and final waivers of lien and receipted bills covering all labor and materials expended. Should any claim of lien or lien action be filed directly against Landlord Tenant shall indemnify and hold harmless Landlord from such claim or action and shall reimburse all costs, including reasonable attorneys' fees, incurred by Landlord in defending said claim or action. Upon completing any alterations, up-fit, and remediation 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, up-fit, and remediation shall comply with all insurance requirements and with all ordinances and regulations of any applicable public authority. All alterations, up-fit, and remediation shall be performed in a good and workmanlike manner, using first class materials. Liability described herein shall be limited to the term of the Lease,whether or not extended, and shall terminate with the acceptance of the Rented Space upon return by Tenant to Landlord. (c) Ownership. All alterations and up-fit, made by either party, including without limitation all paneling, walls, decorations, partitions, railings, floors, carpets, galleries, heating or air conditioning equipment, plumbing, electrical machinery and equipment, and any other up-fit shall become the property of Landlord and 241-12 7n Landlord Tenant Initials Initials 15 shall remain upon and be surrendered with the Rented Space and Property as a part of the Rented Space and Property at the end of the Term. Notwithstanding the foregoing, in the event that the Term ends because Tenant has exercised its option to purchase the Property, then all such alterations and upfit shall remain with the Property and shall be conveyed to Tenant at the closing on the Property (by a bill of sale or other appropriate instrument). Furniture, equipment, personal property 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 Landlord has not asserted a lien against such property and further provided that 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 (except in the event that the term ends because Tenant has elected to purchase the Property), 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 anyfixtures 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. Should Tenant exercise its option to purchase all Alterations and up-fit shall convey with the Property. Tenant hereby agrees that upon its surrender of the Property, it shall assign to Landlord any and all warranties given to Tenant with respect to any work performed pursuant to this Lease. 11. ACCEPTANCE OF LEASED PREMISES. Occupation by Tenant shall constitute acceptance of the Leased Premises AS IS. 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. Obtaining all 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 and up-fit done by the Tenant or contractors engaged by the Tenant. Tenant acknowledges it has been notified certain areas of the Property have moisture intrusion and mold growth. Tenant acknowledges and accepts this notification and accepts the Property with this and any other defect, known or unknown, including other potential areas of moisture intrusion or mold growth and Tenant is solely responsible for all costs related to full remediation of such moisture intrusion and mold growth and any other issues arising related to such moisture intrusion, provided that Tenant does not elect to terminate this Lease during the Inspection Period (if Tenant does elect to terminate this Lease during the Inspection Period, Tenant shall have no liability for such costs or for such remediation). Tenant releases Landlord from any further responsibility or obligation to provide further notice of or remediate any moisture intrusion and mold growth and releases, indemnifies, and holds harmless Landlord from any and all claims related to such moisture intrusion, if Tenant does not elect to terminate this Lease during the Inspection Period. 12. COMMENCEMENT. Landlord shall deliver exclusive possession of the Leased Premises to Tenant in its current"as-is"condition upon the full execution of this Lease. Following the expiration of the Inspection Period, Tenant shall commence its upfit of the Leased Premises pursuant to plans and specifications approved by Landlord (such approval not to be unreasonably withheld, conditioned or delayed) (the"Tenant Improvements"). Tenant shall prosecute the Tenant Improvements without delay in a commercially reasonable manner beginning on the date hereof. Upon Tenant's substantial completion of the Tenant Improvements such that Tenant can commence operations in the Premises in accordance with its customary office usage, and Tenant's receipt of a Certificate of Occupancy for the Premises, "Substantial Completion" shall be deemed to have occurred. If not sooner obtained, but subject to delays in Substantial Completion due to events of force majeure, Substantial Completion and the Commencement Date shall be deemed to have occurred on the date that is two hundred seventy (270) days following the expiration of the Inspection Period, even if Tenant has not received a Certificate of Occupancy for the Premises or commenced operations in the Premises by that date. Time is of the essence with regard to the Substantial Completion. 13.ASSIGNMENT OR SUBLEASE. (a) Assignment. Tenant may not mortgage, encumber, pledge, or assign this Lease without Landlord's prior written consent, such consent not to be unreasonably withheld, conditioned or delayed. Notwithstanding the foregoing, Tenant may, without Landlord's consent, assign this Lease to (i) an entity controlling, controlled by or under common control with Tenant, (ii) a successor to Tenant by merger or acquisition, or(iii) the purchaser of all (or substantially all) of Tenant's assets at the Premises, provided that Tenant shall remain liable under this Lease. (b) Subletting. Tenant may not sublet the Leased Premises or any part thereof without Landlord's prior written consent, such consent not to be unreasonably withheld, conditioned or delayed. (c) Requirements. In the event of a proposed assignment of this Lease or subletting of all or a substantial part of the Leased Premises, Tenant shall submit to Landlord, in writing, (i) the name of the proposed assignee or subtenant, (ii) current financial statements available to Tenant disclosing the financial 9W 719 an ord Tenant Initials Initials 16 condition of the proposed assignee or subtenant(any assignment or subletting being subject to confirmation the assignee or subtenant has the same or similar financial position as Tenant, the absence of which by the proposed assignee or subtenant shall constitute absolute grounds for Landlord's denial of the requested assignment or subletting), (iii) the nature of the business of the proposed assignee or subtenant, and its proposed use of the Leased Premises (any assignment or subletting being subject to restrictions on use contained in this Lease, the violation of which by the proposed assignee or subtenant shall constitute absolute grounds for Landlord's denial of the requested assignment or subletting), and (iv) the proposed commencement date of the assignment or subletting, together with a copy of the proposed assignment or sublease. If approved by Landlord, Tenant shall promptly deliver a copy of the fully executed assignment of sublease to Landlord upon its receipt of same. In no event shall this Lease be assignable by operation of any law except as provided herein, and Tenant's rights hereunder may not become, and shall not be listed by Tenant as an asset under any bankruptcy, insolvency, or reorganization proceedings. Tenant is not, ay not become, and shall never represent itself to be an agent of Landlord, and Tenant acknowledges that Landlord's title is paramount, and that it can do nothing to affect or impair Landlord's title. Tenant shall remain primarily liable for the performance of all terms of this Lease in the event of any assignment or subletting. Tenant shall pay all reasonable costs incurred by Landlord in connection with such assignment or sublease, including without limitation, attorneys'fees, up to a maximum of$2,000 per request. Tenant shall pay to Landlord fifty percent (50%) of any rental and fees received by Tenant in excess of (y) any amount payable to Landlord hereunderp/us(z)any amounts expended by Tenant(including brokerage commissions) in procuring such subtenant. 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: (i) If Tenant fails to pay any rent or other monetary payments as and when provided in this Lease, and such failure continues for more than ten (10) days following Tenant's receipt of written notice of such failure; (ii) If Tenant breaches any other obligation set forth in this Lease and fails to cure such breach within thirty (30) days after notice thereof; or if cure of the breach would require more than thirty(30) days to effect, if Tenant fails to initiate action necessary to cure such breach within the thirty(30) day period and to pursue such action diligently thereafter until the breach is cured; (iii) 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 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: (i) Terminate this Lease. (ii) 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; (iii) 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 that would have been due during the then current Term, provided that such amount shall be offset by the fair market rental value of the Premises for such remaining period of the current Term; and a pro rata portion of any leasing commission Landlord Tenant Initials Initials 17 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 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 Property. Tenant hereby grants to Landlord alien for the payment of rent, additional rent and all other monies to be paid by Tenant to Landlord under this Lease, 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 Property. Such lien may be enforced in any lawful manner by the Landlord. Notwithstanding the foregoing, Landlord acknowledges that Tenant may seek financing from a third-party, institutional lender which may require a first priority lien on such goods, wares, chattels, fixtures, furniture, equipment and other property, and in such circumstance, Landlord agrees to enter into and provide a commercially reasonable subordination agreement subordinating Landlord's lien rights in and to such goods, wares, chattels, fixtures, furniture, equipment and other property to the lien rights of such lender. (e)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. (f) 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. (g) Incentive Agreement. Landlord shall be entitled to any rights and remedies provided for in the Incentive Agreement for an event of default under this Lease. However, in the event of a default under the Incentive Agreement, in the absence of an event of default under this Lease, Landlord's rights and remedies shall be limited to those provided in the Incentive Agreement. Notwithstanding anything to the contrary contained herein, in no event shall Tenant be liable for consequential, punitive, or special damages. 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 (unless Tenant has properly exercised the option to purchase the Leased Premises), then the Tenant shall be a tenant at sufferance from month to month only, and the Tenant shall then be obligated to pay one hundred fifty percent (150%) 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) Tenant's Insurance. Tenant 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 also be for the benefit of Landlord. Llaw an lord enant Initials Initials 18 (b) Notice by Tenant. If the Rented Space is damaged or destroyed by any peril covered by the insurance to be provided by 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 under subparagraph (a) above that rebuilding or repairs cannot in the estimation of a licensed North Carolina General Contractor selected by Landlord, be completed within one hundred fifty (150) days after the date of such damage, Tenant may elect, in its sole discretion, to terminate this Lease, 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 under subparagraph (a) above, but only to such extent that rebuilding or repairs can, in the estimation of a licensed North Carolina General Contractor selected by Landlord, be completed within one hundred fifty(150)days after the date of such casualty,this Lease shall not terminate, and Tenant 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. There shall be no abatement of rent during any such period of rebuilding and repair. (e) Landlord's Option to Terminate. Notwithstanding any other provision herein, if any portion of the Rented Space is materially 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 delivered within forty-five (45) days of the date of such damage. 18. TENANT'S INDEMNITY OF LANDLORD AND TENANT'S INSURANCE. (a) Tenant's Indemnity of Landlord. To the extent authorized by North Carolina law, Tenant shall indemnify and save the Landlord and its agents, officers, 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 Property 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 Property. (b) Tenant's Commercial General Liability Insurance. Tenant shall at all times during the Term, at its sole cost and expense, procure and maintain in force and effect a policy or policies of commercial general liability insurance issued by a company or companies from time to time approved by Landlord, which companies must be authorized to transact business in North Carolina. Such policy or policies shall insure against loss, damage or liability for injury to or death of persons and loss or damage to property occurring from any cause whatsoever in, upon or about the Property. Such policies of public liability insurance shall name Landlord as an additional insured and shall be in amounts and afford coverage against perils as reasonably required from time to time by Landlord. Coverage shall initially be in the single limit amount of one million dollars ($1,000,000.00). Such policy or policies shall include affirmative coverage of Tenant's indemnity of Landlord pursuant to subsection (a) above. (c) Tenant's Property Insurance. Tenant shall obtain and maintain property insurance upon its furniture, equipment, trade fixtures, and any other personal property of Tenant or of any third parties which may from time to time be located in, on or around the Property. Such insurance shall be maintained in the amount of the full replacement cost of such property. All such policies shall include a waiver of subrogation of any and all claims against the Landlord and name the Landlord as an additional insured. Tenant shall look solely to its insurance policy for recovery of any loss for any such property, and in no event shall it make any claim against the Landlord for any loss to any such property. The Tenant hereby releases Landlord from any such liability, and Tenant shall indemnify and hold the Landlord harmless from and against any claim of Tenant's insurance carrier or arising out of Tenant's failure to maintain such insurance. (d) Tenant's Business Interruption Insurance. Tenant shall at all times during the Term maintain business interruption insurance, insuring Tenant from loss,damage, cost or expense from any disruption to or interruption to its business resulting from damage to or malfunction of the Rented Space or the Property or any components thereof or any of the systems (heating, plumbing, mechanical or otherwise) or utilities serving them. Such insurance shall cover a continuous period of disruption or interruption of not less than one hundred eighty (180) days per occurrence. (e) Policies or Certificates of Insurance. At the request of Landlord,the Tenant shall furnish certified copies of policies or certificates of insurance in the form of or on ACORD 27, or equivalent document, bearing notations evidencing the payment of premiums and evidencing the insurance coverage required to be carried by Tenant under this Lease, including but not limited to,the insurance policies required by Section 17(a) and Sections 18 (b) — (d) hereunder. Each policy and certificate shall contain an endorsement or provision requiring not fewer than thirty (30) days written notice to Landlord prior to the cancellation, diminution in the perils insured against or reduction of the amount of coverage of the particular policy in question. Landlord Tenant Initials Initials 19 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 its agents, officers, and employees from, and waives all claims for damage or injury to person or property or disruption to business sustained by the Tenant, any guest, invitee, trespasser, or any occupant of the Property, 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 Property, whatever the cause. This shall include but not be limited to, the flooding of surface areas, basements or other subsurface areas, and damage caused by refrigerators, sprinkling devices, air conditioning 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, other tenants, occupants or servants in the Building or any other person, and whether such damage be caused or result from anything or any circumstance above mentioned or referred to, or any other thing or circumstance whether of a like nature or of a wholly different nature. (b) 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. Tenant is solely responsible for the cost, maintenance, operation, and provision of all utilities including but not limited to electrical, HVAC, plumbing, etc. (b) Intent. It is the intent of this Lease that Landlord is released from responsibility to provide utilities access on the Property and such responsibility rests solely with Tenant. 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. INSPECTION PERIOD. For a period of one hundred twenty(120) days following the date of the full execution of this Lease (the "Inspection Period"), Tenant may, at Tenant's sole expense, make such inspections of the Premises as it deems necessary, including the taking of soil samples in conjunction with engineering studies, and examining of permitted uses on the Premises. Tenant may obtain an ALTA/ACSM or other form of survey of the Premises during the Inspection Period, and, in the eventthe legal description of the Premises materially differs from the legal description attached hereto as Exhibit A, this Lease shall be amended to replace Exhibit A with the legal description from Tenant's survey. Tenant may further obtain from a reputable company actively engaged in the business of environmental engineering and testing,such reports as Tenant deems necessary to assess the presence of, and risk caused by, asbestos, petroleum products or other potentially hazardous, toxic or dangerous materials in the Premises. Landlord shall allow Tenant, its agents and representatives, access to the Premises during the Inspection Period forthe purposes of the such testing and inspections, and Tenant agrees to leave the Premises in substantially as good of condition as existed prior to such inspections. During the Inspection Period, Tenant shall also be permitted to apply for any and all permits, approvals and licenses for the construction of Tenant's improvements on the Premises, and the operation of Tenant's business therein (collectively, the "Permits"). Landlord agrees to join in any necessary applications for such Permits. At any time during the Inspection Period, Tenant may, in its sole discretion, notify Landlord that the Premises is not suitable for its intended use by Tenant, upon which notice the Lease shall be terminated and of no further force and effect, and neither party shall have any further Ap "�-' Landlord Tenant Initials Initials 20 liability or obligations to the other hereunder. During the Inspection Period, the County shall be permitted to continue to occupy the Premises, provided that(i)the County fully vacates the Premises by the expiration of the Inspection Period, and (ii) the County does not unreasonably interfere with the performance of Tenant's inspections. 24. Intentionally Omitted 25. INFORMATION CONCERNING TENANT. Tenant shall furnish within fifteen (15) days after request from Landlord such current information concerning the financial condition of Tenant as Landlord may reasonably require. Such financial information shall include (but is not necessarily limited to) a financial statement dated not more than twelve(12) months prior to Landlord's request. Such financial statement shall be prepared in accordance with generally accepted accounting principles and, if such request is following the applicable year-end of Tenant's fiscal year, may be certified by a certified public accountant. A general partner or officer or manager of Tenant shall furnish a certification to Landlord to the effect that there either has or has not been any material adverse change in the financial condition of Tenant since the date of the financial statement submitted, and if such certification states that there has been a material adverse change, furnishing such details concerning same 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. 26. AUTHORITY OF TENANT. Tenant represents and warrants to Landlord that (i) Tenant is duly formed, validly existing and in good standing under the laws of its State of Incorporation or Organization and (ii) the persons executing this Lease on behalf of Tenant are authorized to do so. Tenant shall furnish to Landlord within fifteen (15) days after request from Landlord such corporate or company resolutions, certificates of incumbency, partnership resolutions, partnership agreements, operating agreements, bylaws or legal opinions or other information as Landlord may reasonably request in order to confirm that the execution and delivery of this Lease has been duly authorized by Tenant and that the person(s)executing this Lease on behalf of Tenant were duly authorized to do so. All such company, corporate, or partnership resolutions, certificates or agreements shall be certified as being duly adopted and in full force and effect, without amendment, by an appropriate officer, manager or partner 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 Property 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. This Lease is exclusive to the Property. Should the Property become untenantable the Tenant shall have no right to relocate to other property owned by the Landlord, nor shall Landlord have any obligation or responsibility to assist Tenant to relocate. Tenant's rights in any event in which the Rented Space becomes untenantable are limited to those rights established herein. 29. LANDLORD'S ACCESS TO RENTED SPACE. The Landlord or Landlord's agent shall have the right to periodically enter upon the Rented Space and the Property to inspect them by providing Tenant with at least 48 hours prior notice and the opportunity for Tenant to have a representative accompany Landlord and its agents. Such inspection shall occur during regular business hours and the Tenant shall be personally present to open and permit an entry into the Rented Space and Property. In the event of an emergency the Landlord or Landlord's agents may enter the same by a master key, or may forcibly enter the same, without prior notice and without rendering 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 have the right to show the Rented Space and Property 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 Property 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 Lan lord Tenant Initials Initials 21 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, provided that such agreement contains commercially reasonable non-disturbance language. Tenant shall have the right at any time to grant a security interest in Tenant's Property. Landlord hereby consents to any such security interest and disclaims any interest of any kind in any such goods and property installed or kept on the Premises. Landlord agrees that it will,within ten (10) days after any written request by Tenant, confirm the foregoing consent and disclaimer in writing in such form as may be requested by Tenant. Further, Tenant may, without the approval of the Landlord, at any time mortgage, encumber, pledge or assign as security its right, title and interest in and to the leasehold estate created hereby. Tenant may, at anytime, give the Landlord a notice(hereinafter referred to as a"Mortgage Notice")containing the name and address of a lender (hereinafter referred to as a "Mortgage Lender") to which the leasehold estate created hereby has been or will be mortgaged, encumbered, pledged or assigned as security. Landlord agrees to join in (and cause all other parties whose consent or joinder is required to join in) Tenant's encumbrance of Tenant's leasehold interest to any Mortgage Lender. Provided, however, that any such mortgage, encumbrance, pledge, assignment or security interest may not provide for any liability of Landlord except as may be explicitly provided in this Lease and Landlord shall not be personally liable for any loan secured by any mortgage, encumbrance, pledge, assignment or security interest in Tenant's Leasehold estate created 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 of 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: Orange County Director, Asset Management Services Margaret Lane Hillsborough, NC 27278 If to Tenant: 419 W. Franklin St. Chapel Hill, NC 27516 Attn: Jared Sokolsky With a copy to: Moore &Van Allen PLLC 100 North Tryon Street, Suite 4700 Charlotte, NC 28205 Attn: Christopher D. Thompson, Esq. -AND- (b) Sent by email transmission to the following: If to Landlord: ALL—AMS—MANAGEMENT@orangecountync.gov If to Tenant: jared.sokolsl<W well.co thompsonc@mvalaw.com (c) Payment made to: Orange County Finance and Administrative Services P.O. Box 8181 Hillsborough, NC 27278 Either party may change its designated address or email address for receipt of notice by written notice to the other party pursuant to this Section 33. 34, ENTIRE AGREEMENT; MODIFICATION. Except as otherwise referenced herein 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 6WTenant Initials Initials 22 representations,warranties or promises with respect to the Rented Space,the Building or the Property, 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 and Legal Description of Property Exhibit B Sketch of Rented Space Exhibit C Memorandum of Lease 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 AND TENANT'S RELEASE. This Lease shall be governed and construed pursuant to the laws of North Carolina. Any action brought to enforce or contest any term or provision of this Lease shall be brought in the North Carolina General Court of Justice sitting in Orange County, North Carolina. The Parties hereto stipulate to the jurisdiction of said court. It is agreed by the Parties that no other court shall have jurisdiction or venue with respect to any claims, complaints, suits, or actions arising out of or related to this Lease. Binding arbitration may not be initiated by either party, however,the Parties may agree to nonbinding mediation of any dispute prior to the bringing of a claim, complaint, suit, or action. Should any court having jurisdiction determine this Lease in whole or in material part is unlawful or the entering thereof is or was outside the scope of Landlord's authority, Landlord may terminate this Lease without further obligation (except as provided herein) and Tenant specifically releases and holds harmless Landlord, its agents, employees, officers and assigns from any loss, liability, claim or damage suffered by Tenant as a result thereof and waives the right to bring any action or complaint against Landlord to recover for same. Notwithstanding the foregoing, in the event of any such termination, Tenant may elect to exercise the option to purchase set forth in Section 3(d) herein by providing Landlord with written notice thereof within sixty(60) days of such termination, and such termination shall not void Tenant's option to purchase so long as Tenant provides such written notice within the aforesaid 60-day period. 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. Intentionally Omitted. 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 RECOVERY AGAINST LANDLORD. Tenant acknowledges and agrees that the liability of Landlord under this Lease shall be limited to its interest in the Property and any judgments rendered against Landlord shall be satisfied solely out of the proceeds of the sale of its interest in the Property. No personal judgment shall lie against Landlord upon extinguishment of its rights in the Property 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 not dealt directly with any brokers in connection with this Lease, and that no broker procured this Lease or is entitled to any commission in connection with the Lease, and in the event either party has hired a broker such hiring party shall 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. MEMORANDUM. Concurrently with the execution of this Lease,the Landlord and Tenant shall execute and deliver a memorandum of lease in the form provided for on Exhibit C attached hereto and incorporated herein, which memorandum of lease shall reference Tenant's right to purchase the property, and such andlord Tenant Initials Initials 23 memorandum of lease may be recorded by Tenant with the Orange County Register of Deeds following the expiration of the Inspection Period. 45. FORCE MAJEURE. Except for the payment by Tenant to Landlord of any sum due under this Lease, neither Landlord nor Tenant shall be considered in default of any of the terms, covenants and conditions of this Lease on such party's part to be performed if such party fails to timely perform same, and such failure is due, in whole or in part, to any strike, lockout, labor trouble, whether legal or illegal, civil disorder, inability to procure materials, failure of power, restrictive governmental laws and regulations, riots, insurrections, war, fuel shortages, accidents, pandemic or epidemic, casualties,Acts of God,acts caused directly or indirectly by the other party or its's agents, employees or invitees, or any other cause beyond the reasonable control of the performing party. Force Majeure does not include failure of the Tenant to secure permitting necessary for the up-fit, occupancy, or other use of the Property. 46. TAXES. Tenant shall be responsible for all ad valorem taxes on the Property (if any) during the Term, taxes on its personal property and on the value of any leasehold improvements. 47. COUNTERPARTS. This Lease may be executed in counterparts. Each fully executed counterpart shall be an original and it shall not be necessary in making proof of this Lease to produce or account for more than one such counterpart. The submission of this Lease by Landlord, its agent or representative,for examination or execution by Tenant does not constitute an option or offer to lease the Leased Premises upon the terms and conditions contained herein or a reservation of the Property in favor of Tenant. It is intended hereby that this Lease shall only become effective upon the execution hereof by Landlord and delivery of a fully executed counterpart hereof to Tenant. 48. MISCELLANEOUS. All rights and remedies of Landlord underthis Lease shall be cumulative and none shall exclude any other rights or remedies allowed by law. In the event this Lease or any term or condition hereof is prohibited by law, it shall be considered null and void and of no further effect. In the event of a conflict between the terms and conditions of this Lease and the Lease Provisions Term Sheet, the terms of the Lease shall govern and control. IN WITNESS WHEREOF, Landlord and Tenant have duly executed this Lease,to be effective as of the date first stated above. LANDLORD: Orange County North Carolina P.O. Box 8181 Hillsborough, North Carolina 27278 w Attest: Renee Price, Chair TENANT: Well Dot, Inc. xa Attest: °,fr� � i By: �� Landlord Tenant Initials Initials 24 EXHIBIT A SITE AND DESCRIPTION OF THE PROPERTY Attached to and Made Part of Lease 1 PIN 9789-15-1829 FIN 9788-15-1996 PIN 9788-15-2822 TAX MAP NO. 7.92.F'.2A 'TAIL MAY NO. 7.92.F.2 TAX M" NO. 7.92.F'.3 All those certain tracts or parcels of land, together with all improvernents: thereon situated, lying and being at the Southwesternn intersection of West Franklin and South Roberson Streets in the 'Torn of Chapel Frill, North Carolina and more particularly described as: BEGINNING at a stake in the intersection and running thence along the 'West property line of South Roberson Street, South 25° 15' 18" East 200 feet to a stake; theme continuing with the West property line of South Roberson Street, South 25" 15' 18" East 85 feet to a stake; thence leasing the West property line of South Roberson Street and following with a northern, lime of property now or formerly owned by Pecolia Hogan, South 64' 36' 31" West 136.56 feet to a stake; thence South 25' 48' 27" East 65.91 feet to a stake; thence South 65® 16' 21" West 37.70 feet to a stare; thence North 25' 28' 00" West 350.30 feet to a stake in the South property line of West Franklin. Street; thence with the ,South property lige of West Franklin Street North 644 33' 05" East 1.06.25 feet to a stake; thence continuing with the South property line of West Franklin Street North 64° 33' 05" East69.67 feet to a stake, the point and place of BEGINNING, according to plat of survey entitled "Physical Survey Prepared For The County of Orange" by Ballentine & Riley Surveyors, dated 7-8-96 and last revised July 17, 1996, and recorded. in Plat Book 76, Page 143, Orange County Registry, to whish plat reference is hereby made for a more particular description of the property conveyed. Same being Dots 1-A, 1-B, 2 and 3 as per plat and survey entitled "Property of Forest Dills Shopping Center, Inc., et al." by Robert J. ,Ayers, Surveyor, dated October 1963, as revised July, 1967, which plat is recorded in flat Book 16, Page 27, Orange County Registry and also being part of the property shown onthe plat entitled "Recombination of the Property of Orville Campbell" by Freeland Surveyors, Inc., dated December 22, 1987 and revised January 14, 1988 and January 21, 1988, which plat is recorded in Plat book 49, page 72, Orange County Registry. Landlord Tenant Initials Initials 25 EXHIBIT B SKETCH OF RENTED SPACE Attached to and Made Part of Lease Landlord Tenant Initials Initials 26 0Di Fri ® ®61i a o a HE o e •`- romtmon a�® � �� 0 o� T 0LO 0� Ed RAMP DONT! 111111"uuu"' prbg55 g � o � o a L dlord Tenant Initials Initials 27 28 EXHIBIT C FORM OF MEMORANDUM OF LEASE Mail after Recording to: Steven A. Arndt, P.O. Box 8181 Hillsborough, NC 27278 STATE OF NORTH CAROLINA MEMORANDUM OF LEASE. ORANGE COUNTY THIS MEMORANDUM OF LEASE ("Memorandum"), made and entered into 6s of the last date set forth in the notary acknowledgments below (the "Effective Date"), by and between ORANGE COUNTY,- a political subdivision of the State of North Carolina, hereinafter referred to as ("Landlord") and WELL°bOT, Inc., hereinafter referred to as ("Tenant"). Landlord and Tenant may be collectively referred to hee,einafter as the "Parties" or individually as the "Party." WITNESSETH: WHEREAS, the Parties executed a Lease Agreement for the Leased Premesis; and WHEREAS,the Parties desire to record this Memorandum for the purpose of providing record notice of the existence of the Lease and certain of the terms contained therein. NOW,THEREFORE,for and in consideration of the terms, covenants, and conditions set forth in the Lease and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, Landlord and Tenant hereby acknowledge and declare as follows: 1. Leased Premises. 501 W. Franklin Street, 503 W. Franklin Street, and 108 S. Roberson Street Chapel Hill, NC 27517, three parcels situated in Chapel Hill, North Carolina having approximately 21,612 square feet of office space. 2. Term. The term of the Lease shall be for a period of 120 months and shall commence on the date of Substantial Completion, as that term is defined in the Lease Agreement (the"Term"). Upon mutual consent the Lease may be extended by Tenant for two additional terms of five years each. 3. Option. During the initial 120 month term,the Tenant may exercise an option to purchase the Leased Premises. 4. Incorporation. All of the terms, covenants, and conditions contained in the Lease Agreement are incorporated herein by reference. Should the terms, covenants, and-, conditions contained in this Memorandum conflict with the terms, covenants, and conditions contained the Lease Agreement,the terms, covenants, and conditions of the Lease Agreement shall control. [signature on following page] Landlord Tenant Initials Initials 29 IN WITNESS WHEREOF the Parties have caused this Memorandum to be duly executed and recorded as of the effective date. LANDLORD: ORANGE COUNTY By: •� �� STATE OF NORTH CAROLINA COUNTY OF ORANGE I, �GX�. 1E� a Notary Public for County, North Carolina, do hereby certify that personally appeared be re me this day and acknowledged the due execu ion of the foregoing instrument. WITNESS my hand and official seal, this the day of 2022. 01LA SEN SEAL ••' �'•.�' ' Notary Public 1 : NOTARY '. t= My Commission Expires: PUBLIC ; c yes: :�+ ti TENANT: By: Z—ayzD -- And: STATE OF NORTH CAROLINA COUNTY OF1�,GC I, If b2 ► (34-e! a Notary Public for V-1m(4C_ County, North Carolina,do hereby certify that7caye,-4G t and -------- personally appeared before me this day and acknowledged the due execution of the foregoing instrument. WITNESS my hand and official seal, this the day of r QY� , 2022. l`-P i r:��z�" SEAL A%I- IPA?-, Notary Public JPL ATFL{``�•, My Commission Expires: V,, bvi,h_Y MY S i1-2mm 'y Landlord Tenant Initials Initials 30 WELL DOT, INC. 419 W. Franklin Street Chapel Hill,NC 27516 October 5, 2022 VIA EMAIL AND HAND DELIVERY Orange County Director, Asset Management Services Margaret Lane Hillsborough,NC 27278 Email: ALL AMS M NAGEMENTaoran ecoun nc. ov Re: Lease dated June 8, 2022 (as amended, the "Lease") by and between Orange County, a political subdivision of the State of North Carolina ("Landlord") and Well Dot,Inc. ("Tenant") Dear Sir or Madam: By this letter agreement ("Letter Agreement"), we desire to amend Section 23 of the Lease for the purpose of extending the Inspection Period so that it shall now expire on Monday, November 21, 2022. As communicated to Landlord, Tenant has encountered issues with the groundwater at the premises under the Lease in its environmental due diligence, and requires the additional Inspection Period time for purposes of conducting further testing thereon to determine the suitability of the premises for Tenant's use. During such extended Inspection Period, Tenant reserves the right to terminate the Lease by providing written notice to Landlord of such termination prior to the expiration of such extended Inspection Period. As, without the foregoing amendment, the Inspection Period expires tomorrow, on October 6, 2022, in the event that Landlord has not countersigned and acknowledged this Letter Agreement where indicated below, this Letter Agreement shall also serve as Tenant's official written notice tenninating the Lease pursuant to Section 23 of the Lease. Notwithstanding the foregoing, in the event that Landlord countersigns and acknowledges this Letter Agreement where indicated below after October 6, 2022, but prior to October 31, 2022 (the "Outside Effectiveness Date"), then the Lease shall automatically be reinstated and shall be deemed in full force and effect in all respects, including the amendment to Section 23 set forth in this Letter Agreement. Following the Outside Effectiveness Date, the reinstatement of the Lease pursuant to this Letter Agreement shall be nullified regardless of any subsequent execution by Landlord, and the Lease shall be deemed terminated and of no further force or effect. Very truly yours, WELL DOT, INC. By: Name: 3Ag© SoK-6 K-( Its: 04tt'T FwAiiCtAL ofiftuu7L,-WAS -%rrt rZ- [LANDLORD SIGNATURE ON FOLLOWING PAGE] exax2\1958522vi 31 ACKNOWLEDGEMENT AND AGREEMENT TO AMEND: By executing this Letter Agreement, Landlord hereby agrees to the terms of this Letter Agreement and the amendment of Section 23 of the Lease such that the Inspection Period shall now expire on Monday, November 21, 2022. With such signature, no further amendment to the Lease shall be required in order to accomplish such revision to the Lease. In the event that this Letter Agreement is executed by Landlord after October 6, 2022 but prior to the Outside Effectiveness Date, the Lease shall be automatically reinstated and shall remain in full force and effect, and shall be deemed amended as set forth in this Letter Agreement, with no further action of the parties required. LANDLORD: ORANGE COUNTY, a political subdivision of the State of North Carolina By: Name: Its: Date: October 2022 CHAR2\195 8522v 1