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HomeMy WebLinkAboutCSE-20-11 Boogy Baybee LLC RedactedApplication Type Social Equity Criteria Applicant (Entity) Information Social Equity Cannabis Business Permit Application CSE-20-11 Submitted On: Nov 12, 2020 Applicant VERONICA GONZAGA In order to qualify as a social equity applicant, applicants must satisfy at least one of the following criteria: 1. Low income household and either: a. A past conviction for a cannabis crime, or b. Immediate family member with a past conviction for a cannabis crime. 2. Low income household in a zip code identified as at least 60% according to the CalEnviroScreen for five (5) consecutive year period and either: a. A past conviction for a cannabis crime, or b. Immediate family member with a past conviction for a cannabis crime. 3. Low income household and either: a. Five (5) years cumulative residency in a zip code identified as at least 70% according to the CalEnviroScreen, or b. Ten (10) years cumulative residency in a zip code identified by CalEnviroScreen. 4. Business with no less than fifty-one percent (51%) ownership by individuals who meet Criteria 1 and 2 above. 5. Cannabis social enterprise with no less than fifty-one percent (51%) ownership by individuals who meet Criteria 1 and 2 above. 6. An individual with a membership interest in a cannabis business formed as a cooperative. Do you meet the above criteria, and want to apply as a Social Equity Applicant? Yes Please state your annual income:Do you have a past cannabis conviction? No Do you claim eligibility based on a family member past cannabis conviction? No Do you represent a cannabis social enterprise? No Do you have a membership interest in a cannabis cooperative? No Application Type Proposed Location Supporting Information Applicant (Entity) Name: BOOGY BAYBEE LLC DBA: AM COMM Physical Address:City: FRESNO State: CA Zip Code: 93722 Primary Contact Same as Above? Yes Primary Contact Name: VERONICA GONZAGA Primary Contact Title: OWNER Primary Contact Phone: 5596686444 Primary Contact Email:HAS ANY INDIVIDUAL IN THIS APPLICATION APPLIED FOR ANY OTHER CANNABIS PERMIT IN THE CITY OF FRESNO?: No Select one or more of the following categories. For each category, indicate whether you are applying for Adult-Use (“A”) or/and Medicinal (“M”) or both Both Please make one selection for permit type. If making multiple applications, please submit a new application for each permit type. Permit Type Retail (Storefront) Business Formation Documentation: Limited Liability Company Property Owner Name: -- Proposed Location Address: -- City: -- State: -- Zip Code: -- Property Owner Phone: -- Property Owner Email: -- Assessor's Parcel Number (APN): -- Proposed Location Square Footage: -- List all fictitious business names the applicant is operating under including the address where each business is located: AM COMM Business Name: Boogy Baybee LLC SOCIAL EQUITY APPLICANT - IF SUBMISSION REQUIREMENTS MET, APPLICATION PASSES Application #: CSE-20-11 ADVANCEMENT IS NOT BASED ON PHASE II SCORE PER APPLICATION PROCEDURES. CANNABIS BUSINESS PERMIT APPLICATION REVIEW - RETAIL Points Possible All or None Exceptional Good Acceptable Applicant Score Evaluation Notes (Explain each time points are deducted) SECTION 1: BUSINESS PLAN 300 Points Possible for Section 1 Resume: Resumes Provided for All Owners: Score 5 5 5 Resumes Provided in 2-page Format: Score 2 2 2 Education: (select highest academic level among ownership team, cannabis specific education separately) Cannabis specific education/training (accredited)2 2 High School Degree Reported: Score 4 4 4 Bachelor's Degree Reported: Score 6 6 Master's Degree or Higher Reported: Score 8 8 Experience: (among ownership team, select one at highest level) Regulated Cannabis Retail Ownership Experience CA 13 13 13 Regulated Cannabis Retail Experience CA (management level or below): Score 10 10 Other Retail Business Experience Reported, More than 5 years: or 8 8 Other Retail Business Experience Reported, Less than 5 Years: Score 5 5 1.1 Sub-Total:30 24 Construction Cost Estimate: Construction Cost Estimate Provided: Score 8 8 6 4 4 Figures listed, but not detailed or explained Construction Contingency Factor Included: Score 6 6 0 Not included All Labor, Trades, Materials, Supplies and Permits and other Cost Factors Identified: Score 6 6 4 2 2 Very general Reference Data Provided for Unit Cost Factors: Score 5 5 3 1 0 Not included Operation and Maintenance Cost Estimates: Operation and Maintenance Cost Estimate Provided: Score 8 8 6 4 6 Estimates included, needs more detail All Labor, Trades, Materials, Supplies, Utilities, and other Cost Factors Identified: Score 6 6 4 2 4 Estimates included, needs more detail Annual Cost Escalators for Operating Costs Provided: Score 6 6 4 2 0 Not included Reference Data Provided for Unit Cost Factors: Score 5 5 3 1 0 Not included 1.2 Sub-Total:50 16 Proof of Capitalization Specific to one or more Owners: Score 5 5 5 Proof of Capitalization Specific to Business Name/Address: Score 5 5 Proof of Capitalization Sufficient to Cover Proforma (3 months) and Construction Costs: Score 15 15 Certified Audited Financial Report Provided for one or more Owners: Score 5 5 1.1 Owner qualifications. Resumes are not to exceed two (2) pages per owner. (30 points possible) 1.2 A budget for construction, operation, and maintenance, compensation of employees, equipment costs, utility cost, and other operation costs.(50 points possible) 1.3 Proof of capitalization in the form of documentation of cash or other liquid assets on hand, Letters of Credit or other equivalent assets which can be verified by the City. (50 Points Possible) Criteria Narrative: Criteria Narrative: Score one of the following for a maximum 20 points: Capital source is 100% liquid (cash in owners bank, no debt obligation)20 20 Capital souce is debt obligation (letter of credit/loan from individual or institution) 10 10 10 Capital consists of non-liquid assets (i.e. real property)8 8 Capital consists of a mixture of liquid and non-liquid assets 15 15 1.3 Sub-Total:50 15 Three Years of Data Provided: Score 10 10 8 6 8 Estimates included, need more detail, need monthly Total Gross Revenue Estimates Provided:3 3 3 Total Gross Revenue by Product Type (flower and manufactured) Identified:3 3 Total Personnel Costs Provided:5 5 4 3 3 Vague, needs more detail Total Property Rental or Purchase Costs Provided:2 2 2 Total Utilities Costs Provided:2 2 2 Total Cannabis Product Purchase Expense Provided 2 2 2 All Contract Services Identified:2 2 2 Annual Net Revenue Identified:3 2 2 Annual Cost Escalators Identified:4 4 3 2 3 Some escalators included Annual Estimated Sales Tax Payments to State Provided:2 2 2 Annual Estimated Sale Tax Payments to City of Fresno Provided:5 2 Annual Business Tax License and Cannabis Permit Fee Provided:2 2 Annual Net Income Provided:5 5 5 Scoring Guidance: full points for realistic figures for all three years. Dock points for severe miscalculations, unrealistic estimates, or providing less than the request three years. 1.4 Sub-Total:50 34 Hours of Operation Provided: Score 5 5 5 Hours of Operation Provided for all 7 days of the week: Score 3 3 0 does not specify days of operation Hours of Operation Provided for Holidays: Score 2 2 0 does not mention Opening and Closing Procedures Provided: Score 10 10 8 6 6 closing procedures don't include security and securing product. Scoring Guidance: full points for describing information in detail. Dock points for leaving information out or not providing enough detail. 1.5 Sub-Total:20 11 1.6.1 Fully describe the day-to-day operations if your applying for a retail permit: i. Describe customer check-in procedures.20 20 15 10 20 II. Identify location and procedures for receiving deliveries during business hours.10 10 8 6 8 Doesn't describe timing of deliveries. iii. Identify the name of the Point-of-sale system to be used and the number of Point-of-Sale locations.10 10 10 Greenbits for In-store, EASE online for deliveries. 2 POS locations in store. 1.6 Daily operations. With as much detail as possible, the Business Plan should describe the day-to-day operations which meet industry best practices. This should include at a minimum the following criteria for each permit type in which you are applying for a permit. (100 points possible) 1.4 Pro forma for at least three years of operation. 1.5 Fully describe hours of operation and opening and closing procedures. (20 points possible) Criteria Narrative: Criteria Narrative: Criteria Narrative: Hours: 9 00am to 10:00pm 2.2 Sub-Total:50 23 CCB Provides Tuition Reimbursement for Certificates: Score 3 3 3 Predetermined amount of continuing ed CCB Provides Tuition Reimbursement for associate degrees: Score 3 3 3 Tuition reimbursed based on hours, attendance, performance CCB Provides Tuition Reimbursement for bachelor's degrees: Score 3 3 3 Tuition reimbursed based on hours, attendance, performance CCB Provides Tuition Reimbursement for master's degrees: Score 3 3 3 Tuition reimbursed based on hours, attendance, performance CCB Provides Tuition Reimbursement for Specialized Commercial Cannabis Business Operations Training: Score 3 3 3 Predetermined amount of continuing ed CCB Offers General Training for Health and Safety, Workplace Environment, Customer Service, etc. 5 5 4 3 3 unspecified topics 2.3 Sub-Total:20 18 General Recruitment Plan Provided: Score 10 10 8 6 0 not provided Social Policy Recruitment Plan Provided: Score 10 10 8 6 10 Recruitment Plan Includes Demographic Data for District, City or County: Score 10 10 8 6 0 not mentioned Recruitment Plan Includes List of CBOs, Non-Profits and Public-Agency Hiring Partners: Score 10 10 8 6 8 mentioned public agency Recruitment Plan Includes Hiring Targets (percentages) by Demographic Groups: Score 10 10 8 6 6 social policy target overall 50%, not broken down to sub-categories 2.4 Sub-Total:50 24 Owners Number of Owners:1 Number of Owners that live within the City of Fresno:1 Number of Owners that live in the County of Fresno:0 Number of Owners that Own a Business in the City of Fresno:1 51%+ ownership interest percent of the Owners live or own a business in the City: Score 80 80 80 51%+ ownership interest percent of the Owners live or own a business in the County: Score 40 40 Less than 50 percent of the Owners live or own a business in the Cityf no owners are local, score zero)20 20 Managers Number of Managers (salaried, non-owners)Managers not addressed other than overall Number of Managers that live in the City of Fresno:hiring strategy Number of Managers that Own a Business in the City of Fresno: 2.3 Describe compensation to and opportunities for continuing education and employee training.(20 points possible) 2.4 Describe the Commercial Cannabis Business plan to recruit individuals who meet the criteria listed in the Social Policy Section 9-3316 (b) (1) of the Fresno Municipal Code (FMC) and the percentage of local employees it hires. (50 points possible) 2.5 Describe the extent to which the Commercial Cannabis Business will be a locally managed enterprise whose owners and /or managers reside within or own a commercial business within the City of Fresno, for at least one year prior to March 2, 2020.(80 points possible) Data, non-scored. Write response in Evaluation Notes column. IF full points achieved for Ownership category, don't score managers. Section is total of 80 points possible. Criteria Narrative: Criteria Narrative: Criteria Narrative: Data, non-scored. Write response in Evaluation Notes column. 100 percent of the Managers live or own a business in the City: Score 20 20 75 to 99 percent of the Managers live or own a business in the City: Score 15 15 50 to 74 percent of the Managers live or own a business in the City: Score 10 10 Less than 50 percent of the Managers live or own a business in the City: Score 5 5 2.5 Sub-Total:80 80 Responsibilities Described for All Titles/Positions: Score 20 20 15 10 20 2.6 Sub-Total:20 20 Does CCB have more than five employees: 5 5 5 will start with 5 employees CCB has signed a peace agreement: Score 5 5 5 will sign 2.7 Sub-Total:10 10 Work Force Plan Provided: Score 10 10 8 6 10 Commitment to Local Hire Provided:10 10 8 6 10 Commitment to Offer Apprenticeships Provided:10 10 8 6 6 as capacity allows will work to build apprenticeships Commitment paying for continuing education provided 10 10 8 6 6 committed but unspecified allocation Description of commitment to paying a living wage provide. (Score same as sec. 2.1)10 10 8 6 6 committed but did not specify entry level rate 2.8 Sub-Total:50 38 CCB is willing to serve as Social Equity Business Incubator: Score 100 100 80 60 N/A This is a social equity application Mentorship and Training: Score Equipment Donation: Score Shelf Space: Score Legal Assistance: Score Finance Services Assistance: Score Other Technical Assistance: Score Scoring Guidance: full points for willingness to serve with detailed plan offering at least three aspects mentioned above or of similar benefit. Less points for willingness to serve but vague or unclear commitment. Zero points if there is no clear commitment to serve as Incubator. Data to inform score on first line of this section. Write response in Evaluation Notes column. 2.8.3. Commitment to pay a living wage to its employees 2.6 Describe the number of employees, title/position and their respected responsibilities.(20 points possible) 2.7 Describe whether the CCB has five (5) or more employees and whether it has signed a labor peace agreement allowing employees to unionize without interference. (10 points possible) 2.8 Provide a workforce plan that includes at a minimum the following provisions: (50 points possible) 2.8.1. Commitment for 30% of employees to be local hires; the business must show that it has either hired or made a good faith effort to hire bona fide residents of Fresno who have not established residency after the submission of an application for employment with the applicant/permittee. 2.8.2. Commitment to offer apprenticeships and/or compensation for continuing education in the field; and Criteria Narrative: Criteria Narrative: Criteria Narrative: Criteria Narrative: 2.9 Describe whether the business is willing to serve as a Social Equity Business Incubator by offering support to local cannabis social equity businesses in the form of mentorship, training, equipment donation, a percentage of shelf space dedicated to Fresno equity business products, legal assistance, financial services assistance, or other technical assistance support.(100 points possible) 2.9 Sub-Total:100 0 Section 2 Total:400 226 SECTION 3: NEIGHBORHOOD COMPATIBILITY PLAN 300 Points Possible for Section 3 CCB will document complaints (time of complaint, nature of complaint, resolution of complaint): Score 10 10 8 6 0 Info not provided. CCB will established a dedicated contact person to receive complaints: Score 10 10 0 Info not provided. CCB will establish a dedicated phone number to receive complaints: Score 5 5 0 Info not provided. CCB will establish a dedicated email address to receive complaints: Score 5 5 0 Info not provided. CCB will establish a response time standard for returning complaint calls and emails: Score 5 5 0 Info not provided. CCB will schedule or participate in periodic community meetings to engage with residents about the CCB operation: Score 10 10 0 Info not provided. Other measure unique to business (i.e. website complaint form)5 5 0 Info not provided. Scoring Guidance: full points for detailed proactive plan addressing all aspects mentioned. Dock points for leaving out aspect, vagueness, or reactive plans. 3.1 Sub-Total:50 0 CCB will maintain a listserv of community residents to update and information residents of business operations. 10 10 0 Info not provided. CCB will schedule or attend periodic community meetings (at least annually) to engage with residents about the CCB operation: Score 10 10 0 Info not provided. CCB will prepare a community outreach and engagement plan: Score 50 50 40 30 30 More detail needed. CCB will issue periodic Newsletters to community providing information about CCB operations 10 10 0 Info not provided. CCB will hire residents from the community work at the CCB: Score 20 20 0 Info not provided. Scoring Guidance: full points for detailed proactive plan. Dock points for leaving out aspect, vagueness, or reactive plans. 3.2 Sub-Total:100 30 CCB has identified sensitive receptors to nuisance odors in vicinity of business operations: Score 5 5 0 Info not provided. CCB has prepared a nuisance odor control plan: Score 10 10 8 6 6 need more detail. Nuisance odor control plan identifies locations where fugitive emissions may exit the premise boundary: Score 5 5 0 Info not provided. Nuisance odor control plan describes specific odor control measures to reduce fugitive emissions exiting the premise boundary: Score 5 5 5 CCB has established an odor reporting system: Score 5 5 0 Info not provided. CCB will install a nuisance odor monitoring system: Score 10 10 0 Info not provided. 3.3 Describe odor mitigation practices.(40 points possible) Criteria Narrative: Criteria Narrative: Criteria Narrative: 3.1 Describe how the CCB will proactively address and respond to complaints related to noise, light, odor, litter, vehicles, and pedestrian traffic.(50 points possible) 3.2 Describe how the CCB will be managed to avoid becoming a nuisance or having impacts on its neighbors and the surrounding community.(100 points possible) 3.3 Sub-Total:40 11 CCB has identified the potential sources of nuisance odors for the business operation: Score 10 10 8 6 0 Info not provided. Scoring Guidance: full points for detailed proactive plan. Dock points for vagueness or reactive plans. 3.4 Sub-Total:10 0 Nuisance odor control plan describes specific odor control equipment: Score 10 10 8 6 6 Need more detail Nuisance odor control plan describes specific odor control measures/techniques: Score 10 10 8 6 6 Need more detail Odor control measures are identified for different nuisance odor sources: Score 10 10 0 Info not provided. 3.5 Sub-Total:30 12 Nuisance odor control plan describes the operation, monitoring, and maintenance requirements for odor control measures: Score 10 10 0 Info not provided. Nuisance odor control plan describes the staff training required for system operations, maintenance, repair, and troubleshooting.10 10 0 Info not provided. 3.6 Sub-Total:20 0 CCB has identified the sources of waste generated by the business operation: Score 10 10 10 CCB has prepared a source-separation plan to segregate different sources of waste generated by business operations: Score 10 10 0 Info not provided. The source-separation plan identifies policy, procedures, and locations where different sources of waste are to be collected for disposal: Score 10 10 8 6 0 Info not provided. The source-separation plan describes specific measures to control the collection and disposal cannabis waste: Score 10 10 0 Info not provided. The name of licensed cannabis disposal company provided: Score 10 10 0 Info not provided. 3.7 Sub-Total:50 10 Section 3 Total:300 63 SECTION 4: SAFETY PLAN 300 Points Possible for Section 4 Safety Plan Prepared by Consultant: Score 10 10 Safey Plan Assessed by Consultant: Score (if prepared by, also give points for assessed by)10 10 3.4 Identify potential sources of odor. (10 points possible) 3.5 Describe odor control devices and techniques employed to ensure that odors from cannabis are not detectable beyond the permitted premises. (30 points possible) 3.6 Describe all proposed staff odor training and system maintenance.(20 points possible) Criteria Narrative: Criteria Narrative: Criteria Narrative: Criteria Narrative: 4.1 The Safety Plan shall be prepared and/or assessed by a professional fire prevention and suppression consultant. (50 points possible) Criteria Narrative: 3.7 Describe the waste management plan. (50 points possible) Safety Plan Prepared for CCB Address (specific proposed location): Score 10 10 Safety Plan includes Site Plan of Premise: Score 10 10 Safety Plan includes Building Layout Plan: Score 10 10 4.1 Sub-Total:50 0 Written Accident/Incident Procedure Provided: Score 20 20 15 10 Procedures Address Multiple Accident/Incident Scenarios: Score 10 10 8 6 Total Number of Scenarios Described: Score Active Shooter Incident Described: Score 10 10 Robbery Incident Described: Score 10 10 4.2 Sub-Total:50 0 Evacuation Plan Provided: Score 20 20 15 10 Adequate Number of Evacuation Routes Identified: Score 20 20 15 10 Evacuation Route Distance to Public Right of Way: Score 10 10 8 6 4.3 Sub-Total:50 0 Location of Fire Suppression System Elements Identified: Score 10 10 Type of Fire Suppression System Elements Identified: Score 20 20 15 10 Location of Fire Extinguishers Identified: Score 10 10 Adequate Number of Fire Extinguisher Locations Identified: Score 10 10 8 6 4.4 Sub-Total:50 0 Written Procedure for Fire Emergencies Provided: Score 20 20 15 10 Written Procedure for Medical Emergencies Provided: Score 20 20 15 10 Cardiac Arrest Medical Emergency Described: Score 20 20 15 10 Gunshot Wound Medical Emergency Described: Score 20 20 15 10 Other Medical Emergency Conditions Described: Score 20 20 15 10 4.5 Sub-Total:100 0 Section 4 Total:300 0 SECTION 5: SECURITY PLAN 300 Points Possible for Section 5 Security Plan Prepared by Consultant: Score 10 10 Security Plan Assessed by Consultant(if prepared by, also give points for assessed by): Score 10 10 Data-write response in Evaluation Notes Column Criteria Narrative: Criteria Narrative: Criteria Narrative: 4.4 Location of fire extinguishers and other fire suppression equipment. (50 points possible) Criteria Narrative: 4.5 Describe procedures and training for all fire and medical emergencies.(100 points possible) 5.1 The Security Plan shall be prepared and/or assessed by a professional security consultant.(50 points possible) 4.3 Describe evacuation routes. (50 points possible) 4.2 Describe accident and incident reporting procedures. (50 points possible) Criteria Narrative: Security Plan Prepared for CCB Address (specific proposed location): Score 10 10 Security Plan includes Site Plan of Premise: Score 10 10 Security Plan includes Building Layout Plan: Score 10 10 5.1 Sub-Total:50 0 Premises (Security) Diagram Provided: Score 20 20 15 10 Diagram is drawn to correct scale: Score 5 5 Diagram provides required details for premise: Score 5 5 Diagram shows the location of all security cameras: Score 5 5 Descriptions of activities to be conducted in each area of the premise 5 5 Limited-Access Areas Clearly Marked: Score 5 5 Number and Location of All Security Cameras Identified: Score 5 5 5.2 Sub-Total:50 0 Intrusion Alarm and Monitoring System Identified: Score 15 15 Name and Contact Information for Monitoring Company Provided: Score 5 5 Total Points of Entry into Premise Identified: Score 5 5 All Points of Entry to be Alarmed Identified:5 5 Type of Alarm Identified (motion, infrared, glass break, etc.): Score 10 10 Backup Power Supply Identified: Score 10 10 5.3 Sub-Total:50 0 Written Cash-Handling Procedure Provided: Score 30 30 20 15 Dual-Custody is Practiced for all cash handling: Score 10 10 Video Surveillance Used to Monitor All Cash Handling: Score 20 20 Armored Car Service Used for Bank Deposits: Score 10 10 All Cash Deposited weekly with Bank: Score 10 10 Onsite Vault Provided to Secure Cash Prior to Bank Deposit: Score 20 20 5.2 Premises (Security) Diagram. In addition to diagrams submitted for other sections of the application, applicants are expected to submit a premises diagram (or site plan) which, focuses on the proposed security measures and how they relate to the overall business. (Pursuant to CCR Title 16, Division 42, §5006. Premises Diagram). 5.2.1 The diagram shall be accurate, dimensioned and to scale (minimum scale ¼"). The scale may be smaller if the proposed location exceeds more than a 1/2-acre parcel but must not be printed on larger than an 11" x 17" sheet of paper. (Blueprints and engineering site plans are not required at this point of the application process) 5.2.2 The diagram must be drawn to scale and clearly identify property boundaries, entrances, exits, interior partitions, walls, rooms, windows, and doorways. The activity in each room and the location of all cameras must be identified in the diagram. Criteria Narrative: 5.2.4 Limited-access areas, defined as areas in which cannabis goods are stored or held and only accessible to permittees, or its employees or contractors and areas used for video surveillance monitoring and storage devices (Pursuant to CCR Title 16, Division 42, §5000 (m) Limited-Access Area and §5042 Limited-Access Area. 5.2.5 Number and location of all video surveillance cameras. (50 points possible) 5.4 Briefly describe cash handling procedures which covers day to day transactions with customers, vendors armor carrier vehicles and transporting it to the bank.(100 points possible) 5.3 Identify intrusion alarm and monitoring system including the name and contact information for the monitoring company (if the company has been selected).(50 points possible) Criteria Narrative: Criteria Narrative: Criteria Narrative: 5.2.3 Description of cannabis activity that will be conducted in each area of the premise. Commercial cannabis activities that must be identified on the diagram/site plan may include but are not limited to the following if applicable to the business operations; storage areas, batch sampling areas, loading/unloading of shipment areas, packaging and labeling, customer sales areas, training areas, employee break room areas, extractions, infusions, processing, and testing areas. 5.4 Sub-Total:100 0 CCB will use onsite security guards: Score 10 10 All onsite guards will be licensed and bonded: Score 10 10 All onsite security guards will be licensed to carry firearms: Score 10 10 Onsite security guards will be on duty before CCB opens for business: Score 10 10 Onsite security guards will be on duty after CCB closes for business: Score 10 10 5.5 Sub-Total:50 0 Section 5 Total:300 0 Section 1: Business Plan Total Points:300 188 Section 2: Social Policy & Local Enterprise Total Points:400 226 Section 3: Neighborhood Compatibility Total Points:300 63 Section 4: Safety Plan Total Points:300 0 Section 5: Security Plan Total Points:300 0 Total Points Achieved:1600 477 PASS TOTAL SCORE 5.5 Discuss whether the CCB will utilize the services of on-site security guards. Include in the discussion: (50 points possible) 5.5.1 Number of guards. 5.5.2 Hours guards will be on-site. Criteria Narrative: 5.5.3 Locations at which they will be positioned. 5.5.4 Guards' roles and responsibilities. Scanned with CamScanner Scanned with CamScanner Scanned with CamScanner Scanned with CamScanner Scanned with CamScanner Scanned with CamScanner Section 1 Business Plan Boogey Baybee LLC applying for a Social Equity Retail license 1.1 Resume See resume attached on the next page. Operating Plans and Procedures All of the plans for operating this business have been created to be in compliance with all applicable laws, including the State of California’s Bureau of Cannabis Control Text of Regulations (BCC regulations) and the City of Fresno’s Article 33, Section 9-3309, 9-3310, 9-3319 and 9-3331 (FMC). 1.5 Fully describe hours of operation and opening / closing procedures. In accordance with Section 9-3310(a)(1) of the FMC, the planned operating hours for the retail storefront are 9:00 AM to 10:00 PM. Employees will be on the premises from the hours of 8:30 AM until 11:00 PM, but after 10:00 PM only non-sales activities germaine to the business will be taking place. Opening Procedures Below is a list of action items related to the opening procedures for various members of the retail team. Security: Management & Employees: ●All employees clock in wearing employee badge ●Manager - Arrive 15 minutes before store opens ●Manager - Turn on POS ●Manager - Count safe ●Manager - Verify the deposit and be the 2​nd​ signature on the bank bag and deposit log, ●Manager - Retrieve cash drawers and set up drawers in POS systems ●Manager - Determine lunch and break schedules ●Sanitize surfaces, tables, and chairs ●Print templates used by drivers, ●Prepare for receiving deliveries ●Restock Closing Procedures Below is a list of action items related to the closing procedures for various members of the retail team. Management: ●Complete end of day reports ●Close credit cards machines ●Count down the drawers ●Count safe ●Prepare deposit ●Complete inventory reports Employees: ●Collect trash for morning staff to take dispose of ●Clean and sanitize the facility as needed ●Stock ●Rotate inventory, checking for expired products. 1.6 Daily Operations 1.6.1 Day to Day Operations - Retail Permit Below is a brief summary of the planned day to day operations for a retail cannabis dispensary business compliant with BCC regulations and the FMC. (a)Customer check-in procedures ●Customers enter building into a lobby/waiting area. ●Customers sign in/register electronically on kiosk. ●Customers wait for Security to verify their ID and/or REC ensuring everything is valid, including DOB and identification expiration. ●Retail employee enters customer info into database prior to customer entering retail sales floor. ●Customer is granted access to the retail sales floors once their information is entered into the database. ●Customer is given a limited amount of time to make their selections while on the sales floor, and is monitored via security camera system ●Customers will be free to walk the sales floor and at the end of their purchase they will be escorted to the exit. ●Capacity of customers in the store will be 2 customers per one budtender. (b)Location and procedures for receiving deliveries The business will have a designated delivery entry that is not in connection with the customer entry door for all inventory deliveries. Additionally: ●Vendors call upon arrival ●Vendors are informed of the designated drop off area ●Vendors complete a sign-in log with arrival and departure times ●Outdoor security guard escorts vendors to the building (c)POS system and locations The business plans to use the Greenbits POS system and will start with 2 POS locations inside the store. Additionally, for customers placing a delivery order through my delivery partner, Eaze, transactions will be conducted online through their proprietary POS system. (d)Estimated number of customers to be served per hour/day The business expects to serve 60 to 110 customers per day, averaging 7 to 10 patients per hour. This will ramp over time as the business grows. (e)Proposed product line to be sold and estimate the percentage of sales of flower and manufactured products The business expects to carry popular California product lines, including West Coast Cure, Risen Labs, and Connected Co. The estimated sales of flower and manufactured products are as follows: ●Flower - 40% of sales ●Concentrates - 20% of sales ●Edibles - 20% of sales ●Topicals - 10% of sales ●Branded Gear - 10% of sales (f)Delivery service procedures Eaze is excited to partner with Veronica and Boogy Baybee to provide management services enabling her business to launch a highly scalable delivery service. Supporting Social Equity Success through Management Services Eaze is committed to supporting social equity entrepreneurs and helping ensure their success in the cannabis industry through a variety of projects and programs. One aspect of Eaze’s support is to provide management services for on-demand delivery of social equity licensees through Eaze’s plant-touching subsidiary, Stachs. This support enables the licensee to operate a successful delivery service managed by the largest & most experienced legal cannabis delivery provider in the U.S. Within 5 years, this delivery service will be generating an estimated in annual cannabis tax revenue for the City of Fresno and employing nearly 150 full and part-time staff with help from local community groups for local recruitment and active engagement with local labor unions. Eaze has a strong foundation built on millions of compliant deliveries; founded in 2014, the company has facilitated over 7 million deliveries to nearly 1 million customers to date. The company employs over 900 workers, making it the largest cannabis employer in the state. Eaze continues to support a diverse and equitable industry; Eaze’s Momentum program offers in grants each year to social equity, women, and LGBTQ entrepreneurs, and the company features a variety of social equity brands on the menu which led to in sales for those brands in 2020. All Eaze delivery operations are driven by local engagement - Eaze engages directly with local organizations to support patients’ rights, workforce development, and responsible business growth in each community where we operate. Tax Revenue & Employment Driven by Boogy Baybee’s Delivery Service Revenue forecasts are ​incremental​ to revenue generated by Boogy Baybee’s storefront sales, and are based on historical behavior of similarly-sized markets. These are projections subject to business and market dynamics (thus are not a guarantee), but markets of similar size have performed to this level. Below is an overview of the delivery service procedures, pursuant to Item 1.6.f of the Business Plan. Hours of Operation The delivery service will accept orders from 9:00 AM to 9:00 PM. Employees will be on premises from 7:30 AM to 11:00 PM, with only non-sales related activities germaine to the business will take place after 10:00 PM (Section 9-3310(a)(1) of the Fresno regulations). Opening Procedures The following is a list of opening procedures: ●Employees clock in ●Unlock doors/vaults ●Turn lights on ●Calibrate security alarms for operating hours ●Set up computers at all stations ●Wipe down tables, chars, surfaces with disinfectant ●Print driver schedules ●Prep driver sheets ●Prep GPS, ID’s, driver bags ●Determine lunch/break schedule ●Count cash posting total on #depot Slack channel ●Make cash change for all shifts ●Printer “on” in packing area ●Refill paper in printers ●Ensure vault is cleanfree of debris, swept ●Restock inventory shelves Closing Procedures When experiencing a high volume of orders near closing time, we use technology demand levers to slow the volume of orders, or otherwise stop accepting orders We also have alerts and actively monitor requests for deliveries toward the end of the day. If we believe requests for deliveries cannot be completed by the BCC and Fresno imposed closing time (which is 10:00 PM pursuant to Section 5403 of the BCC regulations and Section 9-3310(a)(1) of the Fresno regulations) we will cancel the order and communications are shared with the customer regarding the cancelation. Similarly, any order that can not be delivered by a delivery employee before the cutoff time is manually canceled by a member of Eaze support at the request of delivery staff. At the end of the day cash is secured pursuant to the cash handling procedures outlined below. All inventory is kept in limited access areas, locked and monitored by security cameras (pursuant to Section 5042 of the BCC regulations and in compliance with Section 9-3310(b)(3) of the Fresno regulations). Day-to-Day Operations Check-in Protocols​: ●For Employees​: All employees are required to wear state-mandated identification badges issued by the company at all times. Employees will be required to badge into the premises for access. ●For Vendors​: Outside vendors, contractors, or other individuals conducting business at the licensed premises will be required to sign in and out in accordance with their arrival and departure times. Any individual will be escorted by an employee of the company at all times. Process and location for receiving vendor deliveries during business hours​: Vendor deliveries will be received through the side door. Carriers will arrive in the parking lot and bring product into the location. Process for receiving is as follows: 1.Coordinate schedule w/ distributors for deliveries; 2.Schedule large shipment distributors on different days; 3.Upon delivery check in driver and pull purchase order; 4.Receive packing manifest, invoice, and Metrc; 5.Compare packing slip with purchase order; 6.Confirm actual inventory count with packing slip in front of driver; 7.Mark any discrepancy on packing slip and have driver sign off; and 8.If there are discrepancies, request a new invoice and adjust Metrc and Odoo. Point-of-Sale System (POS)​: The delivery service will use Eaze’s custom software as its point-of-sale system, built specifically to facilitate legal cannabis sales placed on eaze.com. All orders placed via ​www.eaze.com will be facilitated by Eaze’s POS system. Number of customers served per hour per day​: 20 (via delivery only) Staff needed to handle customer volume during those times​: 55, including drivers Delivery services procedures​: Driver Training Delivery employees are required to complete a two-hour new hire orientation at the start of their employment. The new hire orientation consists of a slideshow presentation that covers delivery protocols, major infractions, time and attendance, with Q&A, and including without limitation to the following topics: ●Who can receive deliveries of cannabis goods (adults, aged 21+) and the importance of age verification prior to completing the sale of cannabis goods; ●When the process of delivery begins and ends; ●Where cannabis goods can be delivered; ●Delivery vehicle requirements; ●Restrictions on the value and quantity of cannabis goods carried during delivery; ●How to properly carry, secure, and lock the cannabis goods in the delivery vehicle; ●Prohibition of cannabis consumption during delivery; ●Delivery request receipt protocol; ●Risk assessment and enhanced situational awareness; ●Personal safety; ●Emergency protocols in the case of a threat or suspicious activity; ●Usage of onboard cameras; and ●Usage of GPS Systems and communication devices. The new hire orientation also includes a vehicle inspection, employee handbook, driver code of conduct, safety rules, and best practices review. Accepting orders The delivery service will utilize Eaze to facilitate the customer experience of ordering cannabis goods for delivery. Eaze’s software will direct orders to us if the customer is located within the designated zip codes for the area we service via the Fresno licensed premises. Eaze requires customers verify their age and identification before they can place an order to our business via eaze.com to ensure only adults 21 years of age or older are able to purchase cannabis goods from the delivery service. To become a verified customer, the customer must register with Eaze by providing their delivery address and zip code, email address, phone number, uploading a picture of their government issued ID, and submitting a photo of themselves to verify identity through Berbix. Berbix is a third-party software that’s integrated with Eaze to automatically check photo IDs and facial biometrics. Eaze’s Customer Service Team also works with the customer to verify age and identity and upload a medical recommendation to the customer’s account when necessary. After the customer’s age is verified, the customer may select items from the Eaze menu, which is updated in real time based on current inventory, and then completes the checkout process. No order may exceed the daily limits imposed by the state rules and regulations. Orders are received by our staff through an Eaze tool called “Mission Control.” Our employees can generate an electronic delivery request from Mission Control, which is used to fulfill the customer’s order and kept as part of the company’s records. Delivery Preparation After receiving the delivery request, an operations associate pulls the products from inventory. They then scan each item for METRC tracking and place all cannabis products into an opaque exit bag for pickup by the delivery employee. The delivery employee and the associate who prepared the order review the order to acknowledge the order and products included is correct. The delivery employee then places the exit bag into an enclosed case equipped with bicycle locks to secure the case before transporting it to the delivery vehicle. The delivery vehicle will be parked in our parking lot, with a guard posted at the entrance to the lot, preventing unauthorized entry to the lot. Our security personnel will be stationed at the entrance/exit of the lot and will scope the area and monitor the driver while they approach their vehicle to ensure safety. Then, the delivery employee places the case into the trunk of the delivery vehicle where it is secured to the frame of the vehicle. The case will remain locked at all times until the delivery employee arrives at the delivery location. Vehicle Tracking Each of our drivers’ delivery vehicles are outfitted with a GPS Insight GPS device (“GPS device”) plugged into the ODB2 port or vehicle power adapter. The GPS device allows us to track and record each delivery vehicle’s real-time location, where and when each vehicle parks, and each delivery employee’s driving habits. Our business’ owners, managers, and staff can identify the location of a delivery vehicle at any time using the GPS device’s website or mobile device application. Staff are required to monitor the location of each delivery vehicle conducting deliveries until the delivery vehicle returns to the retail premises. All reports relating to each delivery vehicle are easily accessible and can be immediately retrieved. Drivers will utilize an Eaze tool called the “Eaze Driver App”, which is an application with a built-in GPS system. The Eaze Driver App provides the staff with real time tracking of the delivery vehicle. Using Eaze’s Mission Control, staff are able to see which delivery is in process, which deliveries are in queue, and which deliveries have been completed. The Eaze Driver App tracks all routes taken by the delivery driver and records it into the Eaze database. Our staff members can easily and immediately access the database to pull any and all related reports. Driver Communications Our staff (Fleet Managers, Operations Staff, Packers, etc.) communicates with the delivery employees who are engaged in conducting deliveries via hands free phone calls or via text message while parked only, or through the Eaze Driver App. All delivery employees are provided with a list of contact names and phone numbers in case of an emergency and receive emergency training. Route Guidance Delivery employees are instructed to use the Waze route guidance application to be directed to the delivery location using the most efficient route. Additionally, the Eaze platform optimizes route assignments across the fleet of delivery vehicles in real-time. After the delivery employee completes an order, the delivery employee is instructed to either continue to the next delivery location or return back to the retail premises via the Eaze Driver App. The Eaze Driver App’s proprietary routing algorithm is programmed to automatically optimize the delivery employee’s route sequence based on the delivery locations if the delivery employee has more than one delivery to complete. Driver Stops Delivery employees are not permitted to make stops while conducting deliveries, except for as necessary such as a medical emergency, to re-fuel the vehicle, or for meal or rest breaks, as required by law. If the delivery employee must make a stop, he/she must do so on the route back to the retail premises, if possible. Further, the delivery employee must notify a staff member that they are making a stop and the reason for the stop. The staff member notified must closely monitor the delivery employee’s location on Eaze’s tracking map to ensure that the delivery employee does not remain idle for more than 30 minutes. If the delivery employee does not have any delivery requests to be performed for a 30-minute period, the delivery driver shall not make any additional deliveries and shall return to the licensed premises. Delivery Receipt Generation & Delivery We prepare the delivery request receipt for the delivery employee using the Eaze platform. The delivery employee receives the delivery request receipt through the Eaze Driver App. After the delivery employee completes the transaction with the customer, Eaze automatically generates a delivery request receipt, including the date and time the delivery was made and the customer’s signature, that is saved into the delivery reports that Eaze generates for the delivery service and a copy is emailed to the customer. Prior to the conclusion of each day, Eaze provides the delivery service with a delivery report detailing all items and transactions completed by all delivery employees for our records. In-person Age and Identity Verification Upon arriving at the delivery location, the delivery employee reviews and follows any delivery instructions provided by the customer. The delivery employee then requests to see the customer’s ID to verify the customer’s identity against the customer’s name and ID on the Eaze Driver App and to verify that the customer is at least 21 years of age prior to collecting payment to complete the transaction. Once payment is made, the delivery employee hands the prepared exit package containing the cannabis goods to the customer and collects the customer’s signature acknowledging receipt of their delivery. Driver Reconciliation Upon returning to the retail premises after conducting deliveries, the delivery employee is required to reconcile all payments from the delivery order to the supervisor onsite and properly log the transaction into the POS system for inventory tracking purposes. An electronic delivery inventory ledger is provided to the delivery service via the Eaze platform and stored within our records. In order to ensure that cannabis goods do not go unaccounted for when the delivery employee returns to the retail premises; the delivery service requires the delivery employee to reconcile any items not ordered or delivered against the delivery inventory ledger within the Eaze platform. Any unordered or otherwise undelivered cannabis goods shall be returned to inventory and all necessary inventory and track-and-trace records shall be updated prior to closing. Further, delivery service staff review and audit weekly delivery and inventory reports, and any discovered discrepancies must be investigated and reported to the BCC as required. Delivery Security In order to deter diversion and theft of cannabis goods while conducting deliveries, and for the safety of delivery employees, delivery vehicles are unmarked and provide no indication that the vehicle is used for cannabis deliveries (in compliance with Section 9-33110(a)(7) of the Fresno regulations). All cannabis goods are secured in a locked container in the trunk of the delivery vehicle. Delivery employees are trained to be aware of their surroundings and use their best judgment in order to prevent any potential danger and deter diversion and theft. Delivery employees have the right to refuse service if there is any suspicion of a threat of diversion and theft or if the delivery employee does not feel safe. Zero Tolerance Consumption Policy The delivery service prohibits the consumption of cannabis by its employees while working. The new hire training presentation for employees of the delivery service covers the dangers of driving while under the influence of cannabis and enforces its strict policies in prohibiting consumption of cannabis goods by delivery employees while conducting deliveries. Any delivery employee deemed to have consumed cannabis during deliveries will be terminated. Risk Reporting The delivery service’s delivery employees are instructed to first contact law enforcement to provide their location in the event of an existing or potential security or safety risk. The delivery employee shall then call or text to notify the delivery service staff of existing or potential security or safety risks. Delivery employees are required to use the vehicle’s Bluetooth or a handsfree device to text or make calls while driving, or, otherwise, to park the vehicle in a safe location from which to text or call law enforcement or Boogy Baybee staff. The staff member(s) who receive the delivery employee’s report of an existing or potential security or safety risk will immediately notify our management and security personnel either verbally or through written communication. The delivery service’s management and/or security personnel will contact senior management when necessary. Management and security personnel will review and address the delivery driver’s security report. If the security or safety risk is ongoing and has been assessed by management and security personnel as having potential for danger, the delivery employee will be instructed to contact law enforcement as soon as possible, if feasible, or delivery service staff will contact law enforcement on the delivery employee’s behalf. The manager on duty at the retail premises will file an incident report for record keeping purposes and staff will discuss the report with the delivery employee if necessary. Number of delivery vehicles​: We anticipate our delivery fleet will be between 65-75 vehicles. Product security during transport​: Our security personnel who are stationed at the entrance/exit of the lot will scope the area and monitor the driver while they approach their vehicle to ensure safety. Then, the delivery employee places the case into the trunk of the delivery vehicle where it is secured to the frame of the vehicle. The case will remain locked at all times until the delivery employee arrives at the delivery location. Cash Handling Procedures Our number one priority and goal with cash is to get all cash deposited into our bank account as soon as possible. Daily, each driver is checked out with a float for making change, at the beginning of their shift. When they return at day’s end, there is a cash check-out document that is completed with a shift supervisor. The amount of cash per driver is reconciled and is then signed off by the shift supervisor and the driver. At the end of the day, we use a partner portal, which is another Eaze technology tool, to generate a report. The report determines the amount of cash that was collected for the day by all the drivers. Using the report, the Depot Manager will then reconcile all the daily driver cash sheets to ensure reconciliation. Once reconciled, the Depot Managers deposit cash into the safe on the licensed premises. Currently, we bank with both Salal Credit Union and East West Bank. For Salal accounts, we have purchased Smartsafes. These are safes connected to a cloud that once loaded, provide a provisional credit in the bank the next day. The contents are then collected by our armored carrier weekly but on a staggered schedule to maximize secure transfers. The amounts are then reconciled with the provisional credits and any adjustments are then posted and/or discussed. Adjustments are very rare. For accounts with East West bank, we are actively working with them as they launch their new Smartsafe program. Until the program is up and running in its entirety we have cash picked up weekly, also staggered, and posted to our account within 48 hours. All cash is reconciled with the corporate accounting team on a daily basis. Inventory Controls Eaze’s technology will be used for product inventory controls; Eaze integrates with Metrc (the California mandated track-and-trace software). All employees will receive training on inventory storage, inventory tracking, Metrc, inventory reconciliation, and inventory management. Eaze utilizes Odoo, an open source ERP (enterprise resource planning) system, to track inventory at the licensed premises. This ERP system is directly integrated with Eaze POS and is connected to Metrc via an API integration. When cannabis goods arrive and are accepted at the licensed premises, they are stickered for inventory tracking. The inventory tracking sticker contains the product name, product type, Metrc package ID, and a corresponding QR code. When an order is placed via eaze.com, we are alerted inside of the Eaze POS system. A delivery employee will review the order, scan each product’s QR code from the order (the scan is completed via the Eaze driver app), and then pack the order in an opaque exit bag for delivery. The details of the QR scan are automatically sent to the ERP system to update inventory counts at the licensed premises and the required order details are sent to Metrc through the API integration. Other non-sale oriented inventory procedures, such as inventory counts and scrapping inventory, can also be performed inside the ERP and are automatically processed and sent to Metrc. All limited access areas where cannabis goods are stored or handled are constantly monitored by security cameras. 2 Social Policy and Local Enterprise Plan Boogey Baybee LLC applying for a Social Equity Retail license 2.1 Committed to offering employees a Living Wage The business is fully committed to paying employees a living wage. This leads to increased morale & work health, improves the quality of service, and lowers turnover rates. 2.2 Benefits provided to employees For full time employees, the business plans to provide benefits after 180 days including: ●Dental ●Health Care ●Vision ●401K ●Vacation days ●All major holidays (vacation time or overtime pay) ●Medical leave Part time employees: ●Partial coverage of healthcare plan benefits ●All major holidays (vacation time or overtime pay) 2.3 Compensation and opportunities for continuing education and employee training This business plans to offer a variety of opportunities for employees to continue their education and receive training. Investing in employees shows them that the company sees their value and improves employee retention. Continuing education leads to increased performance, increased wages for employees, and in turn, a more effective business. In addition to offering job training and e-learning solutions related to each employee’s position and interests, the business plans to offer several compensation programs to support further education. Tuition funds will be offered to employees based on hours worked, attendance and performance. Employees will also have access to an education reimbursement program and a predetermined amount of continuing education credits to invest in education solutions for employee development. 2.4 Plan to recruit individuals who meet Social Policy Section 9-3316 (b) (1) of FMC and the percentage of local employees it hires The business is committed to making its best efforts to hire 100% from the local community of Fresno. Of these hires, the business aims to have at least half (but will have at least on third) of the hours worked annually completed by an employee that meets one of the following criteria: is classified as low income; lived in low to moderate income tract for the last 3 years; is a Veteran; is a former foster youth; is unemployed or receiving public assistance. Local recruitment in compliance with the Social Policy outlined in the FMC will come through posting job advertisements in local workforce centers, Veterans Affairs offices, the Employment Development Department office and at local job fairs. The business also plans to post jobs on Indeed, ZipRecruiter, Facebook and our website. 2.5 Extent to which the business will be locally managed This business will be 100% locally managed - the owner resides within Fresno and has resided within the city for at least one year prior to March 2, 2020. 2.6 Number of employees, title/positions and responsibilities The business plans to start with 5 employees and eventually grow to at least 20 employees within the first year. These employees consist of: ●Budtenders – cashier, POS, stock, take orders, clean, answer phones, customer service ●Store Manager - inventory and sales reports, forecast sales, human resources, employee scheduling ●Security Guards – protect parking lots, protect inside and outside of the facility ●Shift Manager – handles cash, posts to social media accounts, takes pics and posts new products to menu, assists store manager and handles duties as asked and needed ●Delivery Drivers - deliver products compliantly to customers, clean stock as needed, assist in answering phones and taking orders, location sharing, maintain a clean driving record 2.7 Labor peace agreement allowing employees to unionize When the business employs more than 5 workers, it plans to enter into a labor peace agreement allowing employees to unionize. A copy of the executed agreement will be shared with the City Manager as per Section 9-3316 of the FMC. 2.8 Workforce Plan 2.8.1 30% local hiring The business aims to hire 100 percent locally and is committed to hiring at least 30% of employees locally. There is ample potential for employees to be found and hired locally - the goal is to hire all staff locally. 2.8.2 Apprenticeship & continuing education in the field The business plans to offer opportunities for compensation for continuing education as was outlined above in 2.3. As our capacity allows, we will work to provide apprenticeship and additional methods of industry training. 2.8.3 Commitment to paying a living wage The business is committed to paying living wages to its employees. The business plans to align alongside other big brand retailers that have committed to paying living wages including Target, Amazon, and Costco. 3 Neighborhood Compatibility​ ​Plan Boogey Baybee LLC applying for a Social Equity Retail license 3.1 Response to complaints A summary of the way in which the business would respond to complaints is provided below: ●Noise: The business would enforce a strict policy of NO loud music, no loitering (security will enforce), No hanging out in cars. Rules communicated to new customers with the explanation that breaking the rules leads to a ban from the store. ●Light: The business does not anticipate any complaints regarding light as the activities will not be creating an unreasonable or increased amount of light. Neighbors concerned with the illumination of the property at night for security purposes would be educated around the security protocols used to keep the entire neighborhood more safe and would ensure the lights are not overly bright and are only as bright as needed for functionality and security. ●Litter: ​Assign employees trash duty for multiple receptacles outside​ and create a building checklist for employees to check the outside trash daily so receptacles does not overflow. ●Vehicles: Would ensure security is delegating where to park and that a sign is posted. Would also have the parking area monitored by cameras. Further, there will be a designated delivery driver area and parking to ensure driver safety, designated vendor parking for receiving shipments and customer parking all clearly delineated. ●Pedestrian traffic: The business would ensure pedestrian traffic is controlled by security and monitored at all times by cameras. 3.2 Avoid becoming a nuisance to neighbors The business plans for the engagement of our neighbors and surrounding community members are as follows: ●Build relationships with the neighbors ●Survey the neighbors and pass out flyers to introduce the business and its team to the neighborhood ●Ask neighbors about their feelings about a cannabis business being located in their vicinity ●Talk to and build relationships with property owners ●Work with property owners to inform future tenants of our presence within their neighborhood ●Share a flyer that refers to the rules and regulations regarding cannabis sales and consumption ●Regulate foot traffic - communicate with customers about how to be courteous neighbors ●Utilize technology to help manage traffic - allow customers to wait in cars, pull numbers, or use buzzers to help control traffic ●Utilize online ordering and phone ordering to schedule pick ups ●Communicating wait times with customers to alleviate waiting around unnecessarily 3.3 Odor Mitigation The business does not anticipate a need for odor mitigation as the small amount of cannabis products being stored on site (only as much as is needed to meet the daily demand as is allowed in accordance with Section 9-3310(a)(5) of FMC) is completely packaged, labeled and ready for retail sale. Any odors that would possibly gather as a result of cannabis products would be mitigated effectively by the use of carbon filters and proper ventilation. Additionally, ensuring no one is allowed to smoke on or near the retail premises will help ensure odor from cannabis products does not permeate the space. Automatic air fresheners will help keep the air smelling fresh. 3.4 Potential sources of odor The business does not anticipate any sources of odor being present within the retail premises due to the fact that all cannabis goods are fully packaged before arriving at the facility. 3.5 Odor control devices and techniques In order to ensure the pre-packaged cannabis goods that arrive to the retail premises fully packaged and are stored there do not emit any odors that are detectable beyond the permitted premises, the business plans the following: ●acceptance and sale of prepackaged flowers and cannabis goods only (as per BCC regulations) ●utilizing air filtering ●using carbon filters ●posting signs and adopting policies banning smoking on or around store property ●creating proper ventilation ●running fans ●utilizing odor neutralizers ●using “stink sacks” or odor mitigation sacks for storing cannabis goods ●utilizing mylar bags ●using vacuum seals 3.6 Staff odor training and system maintenance The business’ plan for training the staff on odor control and system maintenance is as follows: ●Educate the staff around procedures and equipment through a training session ●Complete training logs ●Enforce policies once employees have been trained ●Create new policies and procedures as new circumstances arise, ●Add odor mitigation practices and policies into the employee handbook ●Require all employees who operate equipment to receive equipment training ●Complete maintenance logs for equipment ●Supplement training with an online course ●Post signage throughout the store to reinforce training 3.7 Waste management A short summary of the waste management plan is as follows: ●Local garbage pickup will be used for general trash collection ●Cannabis waste will be handled through an authorized waste hauler and documented as per BCC regulations ●Boxes from receiving shipments will be recycled 7 Community Benefits and Investment plan Boogey Baybee LLC applying for a Social Equity Retail license 7.1 Community Benefits and Investment Plan The business is excited to support nonprofit community groups in Fresno doing important work to build up impacted communities and provide the next generation the support it needs to succeed. The business plans to support Fresno’s “​Bringing Broken Neighborhoods Back to Life” program focusing on showing the youth of southwest Fresno a “life without crime” as a collaboration between the Fresno Police Activities League, Stop the Violence Fresno, and area faith-based organizations. Additionally, the business plans to support the ​“​Bringing Broken Neighborhoods Back to Life” program’s partner organization Kids Under Pressure. Both the program and the organization would be supported through participating directly in the work through employee volunteer services when possible, and also through in-kind donations and charitable contributions. The positive ways in which this program and organization affect the community are many, including: ●supporting youth crime prevention ●teaching vocational skills ●fostering mental wellness ●teaching kids coding and web design skills ●teaching kids screen printing and graphic design skills ●purchasing kids school supplies ●supporting community gardens - Mary Ella Brown, Max Park ●standing with Fresno PAL (Police Activities League) and ​Stop the Violence Fresno ●creating mentorship and gang prevention ●supporting youth boxing and sports 7.1.1 Funding or hosting of expungement clinics T​he business aims to provide resources to help fund and provide outreach services for expungement clinics. The business’ proposed delivery service partner Eaze also intends to leverage its in-house Community Affairs team to help organize, fund, and/or host an expungement clinic for the City of Fresno as well. 7.1.2 Environmentally sustainable business model The business aims to be as environmentally sustainable as possible and will consider all measures that decrease the store’s carbon footprint and creation of waste. The business plans to utilize solar panels if and when possible, and will make choices from vendors to office supplies based on environmental responsibility and sustainability. 7.1.3 Utilize vacant buildings, brownfield land, blighted areas As a part of the business’ commitment to the City of Fresno, no matter where the store is located, the business will be focused on beautifying blighted areas of the city and helping redevelop the city in partnership with community organizations, city officials, and other similarly committed business owners. 7.2 Youth public health outreach and educational program Educating the youth around the risks of cannabis use and the dangers of drugs and drug addiction is an important responsibility. In order to engage youth through an outreach and education program, the business plans to create a campaign where information about the risks surrounding youth cannabis use as well as the risks associated with other drugs are circulated - physically through flyers and advertisements in local media, but also virtually through social media and other virtual media sources. The business will work with delivery service management partner Eaze for help developing ideas around outreach for the program and to assist with the production of educational materials. DISCLOSURE REGARDING REAL ESTATE AGENCY RELATIONSHIP (As required by the Civil Code) When you enter into a discussion with a real estate agent regarding a real estate transaction, you should from the outset understand what type of agency relationship or representation you wish to have with the agent in the transaction. SELLER'S AGENT A Seller's agent under a listing agreement with the Seller acts as the agent for the Seller only. A Seller's agent or a subagent of that agent has the following affirmative obligations: To the Seller: A fiduciary duty of utmost care, integrity, honesty and loyalty in dealings with the Seller. To the Buyer and the Seller: (a) Diligent exercise of reasonable skill and care in performance of the agent's duties. (b) A duty of honest and fair dealing and good faith. (c) A duty to disclose all facts known to the agent materially affecting the value or desirability of the property that are not known to, or within the diligent attention and observation of, the parties. An agent is not obligated to reveal to either party any confidential information obtained from the other party that does not involve the affirmative duties set forth above. BUYER'S AGENT A Buyer's agent can, with a Buyer's consent, agree to act as agent for the Buyer only. In these situations, the agent is not the Seller's agent, even if by agreement the agent may receive compensation for services rendered, either in full or in part from the Seller. An agent acting only for a Buyer has the following affirmative obligations: To the Buyer: A fiduciary duty of utmost care, integrity, honesty and loyalty in dealings with the Buyer. To the Buyer and the Seller: (a) Diligent exercise of reasonable skill and care in performance of the agent's duties. (b) A duty of honest and fair dealing and good faith. (c) A duty to disclose all facts known to the agent materially affecting the value or desirability of the property that are not known to, or within the diligent attention and observation of, the parties. An agent is not obligated to reveal to either party any confidential information obtained from the other party that does not involve the affirmative duties set forth above. AGENT REPRESENTING BOTH SELLER AND BUYER A real estate agent, either acting directly or through one or more salesperson and broker associates, can legally be the agent of both the Seller and the Buyer in a transaction, but only with the knowledge and consent of both the Seller and the Buyer. In a dual agency situation, the agent has the following affirmative obligations to both the Seller and the Buyer: (a) A fiduciary duty of utmost care, integrity, honesty and loyalty in the dealings with either the Seller of the Buyer. (b) Other duties to the Seller and the Buyer as stated above in their respective sections. In representing both Seller and Buyer, a dual agent may not, without the permission of the respective party, disclose to the other party confidential information, including, but not limited to, facts relating to either the Buyer's or Seller's financial position, motivations, bargaining position, or other personal information that may impact price, including the Seller's willingness to accept a price less than the listing price or the Buyer's willingness to pay a price greater than the price offered. SELLER AND BUYER RESPONSIBILITIES Either the purchase agreement or a separate document will contain a confirmation of which agent is representing you and whether that agent is representing you exclusively in the transaction or acting as a dual agent. Please pay attention to that confirmation to make sure it accurately reflects your understanding of your agent's role. The above duties of the agent in a real estate transaction do not relieve a Seller or Buyer from the responsibility to protect his or her own interests. You should carefully read all agreements to assure that they adequately express your understanding of the transaction. A real estate agent is a person qualified to advise about real estate. If legal or tax advice is desired, consult a competent professional. If you are a Buyer, you have the duty to exercise reasonable care to protect yourself, including as to those facts about the property which are known to you or within your diligent attention and observation. Both Sellers and Buyers should strongly consider obtaining tax advice from a competent professional because the federal and state tax consequences of a transaction can be complex and subject to change. Throughout your real property transaction you may receive more than one disclosure form, depending upon the number of agents assisting in the transaction. The law requires each agent with whom you have more than a casual relationship to present you with this disclosure form. You should read its contents each time it is presented to you, considering the relationship between you and the real estate agent in your specific transaction.This disclosure form includes the provisions of Sections 2079.13 to 2079.24, inclusive, of the Civil Code set forth on page 2. Read it carefully. I/WE ACKNOWLEDGE RECEIPT OF A COPY OF THIS DISCLOSURE AND THE PORTIONS OF THE CIVIL CODE PRINTED ON THE BACK (OR A SEPARATE PAGE). Buyer Seller Lessor Lessee Date: Buyer Seller Lessor Lessee Date: Agent DRE Lic. # Real Estate Broker (Firm) By:DRE Lic. #Date: (Salesperson or Broker-Associate) THIS FORM HAS BEEN PREPARED BY AIR CRE. NO REPRESENTATION IS MADE AS TO THE LEGAL VALIDITY OR ADEQUACY OF THIS FORM FOR ANY SPECIFIC TRANSACTION. PLEASE SEEK LEGAL COUNSEL AS TO THE APPROPRIATENESS OF THIS FORM. PAGE 1 OF 3 INITIALS INITIALS © 2019 AIR CRE. All Rights Reserved.AD-3.01, Revised 06-10-2019 Phone:Fax: Produced with zipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com X Michael A Richards KW Commercial 01864461 Kevin Land & Jared Ennis 01945284 KW Commercial Central CA, 740 W Alluvial Ave #102 Fresno, CA 93711 5593028698 5594329324 351 N Blackstone Jared Ennis DocuSign Envelope ID: 7E1D49B4-3F86-4E92-8E6C-0DCCF8AE21D4 1/28/2021 1/28/2021 DISCLOSURE REGARDING REAL ESTATE AGENCY RELATIONSHIP CIVIL CODE SECTIONS 2079.13 THROUGH 2079.24 (2079.16 APPEARS ON THE FRONT) 2079.13.As used in Sections 2079.7 and 2079.14 to 2079.24, inclusive, the following terms have the following meanings: (a)"Agent" means a person acting under provisions of Title 9 (commencing with Section 2295) in a real property transaction, and. includes a person who is licensed as a real estate broker under Chapter 3 (commencing with Section 10130) of Part 1 of Division 4 of the Business and Professions Code, and under whose license a listing is executed or an offer to purchase is obtained. The agent in the real property transaction bears responsibility for that agent's salespersons or broker associates who perform as agents of the agent. When a salesperson or broker associate owes a duty to any principal, or to any buyer or seller who is not a principal, in a real property transaction, that duty is equivalent to the duty owed to that party by the broker for whom the salesperson or broker associate functions.(b)"Buyer" means a transferee in a real property transaction, and includes a person who executes an offer to purchase real property from a seller through an agent, or who seeks the services of an agent in more than a casual, transitory, or preliminary manner, with the object of entering into a real property transaction. "Buyer" includes vendee or lessee of real property.(c)"Commercial real property" means all real property in the state, except (1) single-family residential real property, (2) dwelling units made subject to Chapter 2 (commencing with Section 1940) of Title 5, (3) a mobilehome, as defined in Section 798.3, (4) vacant land, or (5) a recreational vehicle, as defined in Section 799.29.(d) "Dual agent" means an agent acting, either ·directly or through a salesperson or broker associate, as agent for both the seller and the buyer in a real property transaction.(e)"Listing agreement" means a written contract between a seller of real property and an agent, by which the agent has been authorized to sell the real property or to find or obtain a buyer, including rendering other services for which a real estate license is required to the seller pursuant to the terms of the agreement.(f)"Seller's agent" means a person who has obtained a listing of real property to act as an agent for compensation. (g) "Listing price" is the amount expressed in dollars specified in the listing for which the seller is willing to sell the real property through the seller's agent.(h)"Offering price" is the amount expressed in dollars specified in an offer to purchase for which the buyer is willing to buy the real property.(i)"Offer to purchase" means a written contract executed by a buyer acting through a buyer's agent that becomes the contract for the sale of the real property upon acceptance by the seller.(j)"Real property" means any estate specified by subdivision (1) or (2) of Section.761 in property, and includes (1) single-family residential property, (2) multiunit residential property with more than four dwelling units, (31 commercial real property, (4) vacant land, (5) a ground lease coupled with improvements, or (6) a manufactured home as defined in Section 18007 of the Health and Safety Code, or a mobilehome as defined in Section 18008 of the Health and Safety Code, when offered for sale or sold through an agent pursuant to the authority contained in Section 10131.6 of the Business and Professions Code.(k)"Real property transaction" means a transaction for the sale of real property in which an agent is retained by a buyer, seller, or both a buyer and seller to act in that transaction, and includes a listing or an offer to purchase.(I)"Sell," "sale," or "sold" refers to a transaction for the transfer of real property from the seller to the buyer and includes exchanges of real property between the seller and buyer, transactions for the creation of a real property sales contract within the meaning of Section 2985, and transactions for the creation of a leasehold exceeding one year's duration.(m)"Seller" means the transferor in a real property transaction and includes an owner who lists real property with an agent, whether "Seller" means the transferor in a real property transaction and includes an owner is the owner from an agent on behalf of another. "Seller" includes both a vendor and a lessor of real property.(n)"Buyer's agent" means an agent who represents a buyer in a real property transaction. 2079.14.A seller's agent and buyer's agent shall provide the seller and buyer in a real property transaction with a copy of the disclosure form specified in Section 2079.16, and shall obtain a signed acknowledgment of receipt from that seller and buyer, except as provided in Section 2079.15, as follows: (a)The seller's agent, if any, shall provide the disclosure form to the seller prior to entering into the listing agreement.(b)The buyer's agent shall provide the disclosure form to the buyer as soon as practicable prior to execution of the buyer's offer to purchase. If the offer to purchase is not prepared by the buyer's agent, the buyer's agent shall present the disclosure form to the buyer not later than the next business day after receiving the offer to purchase from the buyer. 2079.15.In any circumstance in which the seller or buyer refuses to sign an acknowledgement of receipt pursuant to Section 2079.14, the agent shall set forth, sign, and date a written declaration of the facts of the refusal. 2079.16 Reproduced on Page 1 of this AD form. 2079.17(a)As soon as practicable, the buyer's agent shall disclose to the buyer and seller whether the agent is acting in the real property transaction as the buyer's agent, or as a dual agent representing both the buyer and the seller. This relationship shall be confirmed in the contract to purchase and sell real property or in a separate writing executed or acknowledged by the seller, the buyer, and the buyer's agent prior to or coincident with execution of that contract by the buyer and the seller, respectively.(b)As soon as practicable, the seller's agent shall disclose to the seller whether the seller's agent is acting in the real property transaction as the seller's agent, or as a dual agent representing both the buyer and seller. This relationship shall be confirmed in the contract to purchase and sell real property or in a separate writing executed or acknowledged by the seller and the seller's agent prior to or coincident with the execution of that contract by the seller. (C)CONFIRMATION: The following agency relationships are confirmed for this transaction. DO NOT COMPLETE, SAMPLE ONLYSeller's Brokerage Firm License Number Is the broker of (check one): the seller; or both the buyer and seller. (dual agent) DO NOT COMPLETE, SAMPLE ONLYSeller's Agent License Number the Seller's Agent. (salesperson or broker associate); or both the Buyer's Agent and the Seller's Agent. (dual agent)Is (check one): DO NOT COMPLETE, SAMPLE ONLYBuyer's Brokerage Firm License Number Is the broker of (check one): the buyer; or both the buyer and seller. (dual agent) DO NOT COMPLETE, SAMPLE ONLYBuyer's Agent License Number the Buyer's Agent. (salesperson or broker associate); or both the Buyer's Agent and the Seller's Agent. (dual agent)Is (check one): (d)The disclosures and confirmation required by this section shall be in addition to the disclosure required by Section 2079.14. An agent's duty to provide disclosure and confirmation of representation in this section may be performed by a real estate salesperson or broker associate affiliated with that broker. 2079.18 (Repealed pursuant to AB-1289, 2017-18 California Legislative session) PAGE 2 OF 3 INITIALS INITIALS © 2019 AIR CRE. All Rights Reserved.AD-3.01, Revised 06-10-2019 Produced with zipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com 351 N Blackstone DocuSign Envelope ID: 7E1D49B4-3F86-4E92-8E6C-0DCCF8AE21D4 2079.19 The payment of compensation or the obligation to pay compensation to an agent by the seller or buyer is not necessarily determinative of a particular agency relationship between an agent and the seller or buyer. A listing agent and a selling agent may agree to share any compensation or commission paid, or any right to any compensation or commission for which an obligation arises as the result of a real estate transaction, and the terms of any such agreement shall not necessarily be determinative of a particular relationship. 2079.20 Nothing in this article prevents an agent from selecting, as a condition of the agent's employment, a specific form of agency relationship not specifically prohibited by this article if the requirements of Section 2079.14 and Section 2079.17 are complied with. 2079.21 (a)A dual agent may not, without the express permission of the seller, disclose to the buyer any confidential information obtained from the seller.(b)A dual agent may not, without the express permission of the buyer, disclose to the seller any confidential information obtained from the buyer. (c)"Confidential information" means facts relating to the client's financial position, motivations, bargaining position, or other personal information that may impact price, such as the seller is willing to accept a price less than the listing price or the buyer is willing to pay a price greater than the price offered.(d)This section does not alter in any way the duty or responsibility of a dual agent to any principal with respect to confidential information other than price. 2079.22 Nothing in this article precludes a seller's agent from also being a buyer's agent. If a seller or buyer in a transaction chooses to not be represented by an agent, that does not, of itself, make that agent a dual agent. 2079.23 (a)A contract between the principal and agent may be modified or altered to change the agency relationship at any time before the performance of the act which is the object of the agency with the written consent of the parties to the agency relationship.(b)A lender or an auction company retained by a lender to control aspects of a transaction of real property subject to this part, including validating the sales price, shall not require, as a condition of receiving the lender's approval of the transaction, the homeowner or listing agent to defend or indemnify the lender or auction company from any liability alleged to result from the actions of the lender or auction company. Any clause, provision, covenant, or agreement purporting to impose an obligation to defend or indemnify a lender or an auction company in violation of this subdivision is against public policy, void, and unenforceable. 2079.24 Nothing in this article shall be construed to either diminish the duty of disclosure owed buyers and sellers by agents and their associate licensees, subagents, and employees or to relieve agents and their associate licensees, subagents, and employees from liability for their conduct in connection with acts governed by this article or for any breach of a fiduciary duty or a duty of disclosure. AIR CRE * https://www.aircre.com * 213-687-8777 * contracts@aircre.com NOTICE: No part of the works may be reproduced in any form without permission in writing. PAGE 3 OF 3 INITIALS INITIALS © 2019 AIR CRE. All Rights Reserved.AD-3.01, Revised 06-10-2019 Produced with zipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com 351 N Blackstone DocuSign Envelope ID: 7E1D49B4-3F86-4E92-8E6C-0DCCF8AE21D4 STANDARD INDUSTRIAL/COMMERCIAL SINGLE-TENANT LEASE - GROSS (DO NOT USE THIS FORM FOR MULTI-TENANT BUILDINGS) 1.Basic Provisions ("Basic Provisions"). 1.1 Parties:This Lease ("Lease"), dated for reference purposes only , is made by and between ("Lessor") and ("Lessee"), (collectively the "Parties", or individually a "Party"). 1.2 Premises:That certain real property, including all improvements therein or to be provided by Lessor under the terms of this Lease, commonly known as (street address, city, state, zip):, ("Premises"). The Premises are located in the County of , and are generally described as (describe briefly the nature of the property and, if applicable, the "Project", if the property is located within a Project): . (See also Paragraph 2) 1.3 Term:years and months ("Original Term")commencing ("Commencement Date")and ending ("Expiration Date"). (See also Paragraph 3) 1.4 Early Possession:If the Premises are available Lessee may have non-exclusive possession of the Premises commencing ("Early Possession Date"). (See also Paragraphs 3.2 and 3.3) 1.5 Base Rent: $per month ("Base Rent"), payable on the day of each month commencing . (See also Paragraph 4) If this box is checked, there are provisions in this Lease for the Base Rent to be adjusted. See Paragraph 1.6 Base Rent and Other Monies Paid Upon Execution: (a)Base Rent: $for the period . (b)Security Deposit: $("Security Deposit"). (See also Paragraph 5) (c)for the periodAssociation Fees:$ (d)Other: $for . (e)Total Due Upon Execution of this Lease: $. 1.7 Agreed Use: (See also Paragraph 6) 1.8 Insuring Party:Lessor is the "Insuring Party".The annual "Base Premium"is $(See also Paragraph 8) 1.9 Real Estate Brokers: (See also Paragraph 15 and 25) (a)Representation:Each Party acknowledges receiving a Disclosure Regarding Real Estate Agency Relationship, confirms and consents to the following agency relationships in this Lease with the following real estate brokers ("Broker(s)") and/or their agents ("Agent(s)"): Lessor's Brokerage Firm License No.Is the broker of (check one): the Lessor; or both the Lessee and Lessor (dual agent). Lessor's Agent License No.Is (check one): the Lessor's Agent (salesperson or broker associate); or both the Lessee's Agent and the Lessor's Agent (dual agent). Lessee's Brokerage Firm License No.Is the broker of (check one): the Lessee; or both the Lessee and Lessor (dual agent). Lessee's Agent License No.Is (check one): the Lessee's Agent (salesperson or broker associate); or both the Lessee's Agent and the Lessor's Agent (dual agent). PAGE 1 OF 19 INITIALS INITIALS STG-27.40, Revised 11-25-2019© 2019 AIR CRE. All Rights Reserved. Phone:Fax: Produced with zipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com January 4, 2021 Michael A Richards STACHS, LLC a Delaware limited liability company 351 N Blackstone Ave, Fresno, CA 93701 Fresno CA 93705 Fresno one existing +/- 2,890 Sq. Ft. commercial retail building on +/-7,600 Sq. Ft. lot (0.17 Acres total) zoned C-6 Commercial on A.P.N. 459-153-05 5 0 March 1, 2021 February 28, 2026 first 03/01/2021 X 54 03/01/2021-03/31/2021 cannabis delivery/retail use KW Commercial 01864461 X Jared Ennis & Kevin Land 01945284 X Lee & Associates 02090388 X Alex Peck 01981426 X KW Commercial Central CA, 740 W Alluvial Ave #102 Fresno, CA 93711 5593028698 5594329324 Jared Ennis 351 N Blackstone DocuSign Envelope ID: 7E1D49B4-3F86-4E92-8E6C-0DCCF8AE21D4 (b) Payment to Brokers: Upon execution and delivery of this Lease by both Parties, Lessor shall pay to the Brokers the brokerage fee agreed to in a separate written agreement (or if there is no such agreement, the sum of or 6.000 % of the Base Rent) for the brokerage services rendered by the Brokers. 1.10 Guarantor. The obligations of the Lessee under this Lease are to be guaranteed by Stachs, LLC to the extent necessary for approved sublease ("Guarantor"). (See also Paragraph 37) 1.11 Attachments. Attached hereto are the following, all of which constitute a part of this Lease: X an Addendum consisting of Paragraphs 51 through 55 ; a plot plan depicting the Premises; a current set of the Rules and Regulations; a Work Letter; X other (specify): 56.) Arbitration Agreement, Guaranty of Lease, 57.) Option to Extend, and 58.) Option to Purchase. . 2. Premises. 2.1 Letting. Lessor hereby leases to Lessee, and Lessee hereby leases from Lessor, the Premises, for the term, at the rental, and upon all of the terms, covenants and conditions set forth in this Lease. While the approximate square footage of the Premises may have been used in the marketing of the Premises for purposes of comparison, the Base Rent stated herein is NOT tied to square footage and is not subject to adjustment should the actual size be determined to be different. Note: Lessee is advised to verify the actual size prior to executing this Lease. 2.2 Condition. Lessor shall deliver the Premises to Lessee broom clean and free of debris on the Commencement Date, or Lessor’s delivery of the space, if later than commencement date ("Start Date"), and, so long as the required service contracts described in Paragraph 7.1(b) below are obtained by Lessee and in effect within thirty days following the Start Date, warrants that the existing electrical, plumbing, fire sprinkler, lighting, heating, ventilating and air conditioning systems ("HVAC"), loading doors, sump pumps, if any, and all other such elements in the Premises, other than those constructed by Lessee, shall be in good operating condition on said date and that the surface and structural elements of the roof, bearing walls and foundation of any buildings on the Premises (the "Building") shall be free of material defects, and that the Unit does not contain hazardous levels of any mold or fungi defined as toxic under applicable state or federal law. If a non-compliance with said warranty exists as of the Start Date, or if one of such systems or elements should malfunction or fail within the appropriate warranty period, Lessor shall, as Lessor's sole obligation with respect to such matter, except as otherwise provided in this Lease, promptly after receipt of written notice from Lessee setting forth with specificity the nature and extent of such non-compliance, malfunction or failure, rectify same at Lessor's expense. The warranty periods shall be as follows: (i) 6 months as to the HVAC systems, and (ii) 30 days as to the remaining systems and other elements of the Building. If Lessee does not give Lessor the required notice within the appropriate warranty period, correction of any such non-compliance, malfunction or failure shall be the obligation of Lessee at Lessee's sole cost and expense, except for the roof, foundations, and bearing walls which are handled as provided in paragraph 7. Lessor also warrants, that unless otherwise specified in writing, Lessor is unaware of (i) any recorded Notices of Default affecting the Premise; (ii) any delinquent amounts due under any loan secured by the Premises; and (iii) any bankruptcy proceeding affecting the Premises. 2.3 Compliance. Lessor warrants that to the best of its knowledge the improvements on the Premises comply with the building codes, applicable laws, covenants or restrictions of record, regulations, and ordinances ("Applicable Requirements") that were in effect at the time that each improvement, or portion thereof, was constructed. Said warranty does not apply to the use to which Lessee will put the Premises, modifications which may be required by the Americans with Disabilities Act or any similar laws as a result of Lessee's use (see Paragraph 50), or to any Alterations or Utility Installations (as defined in Paragraph 7.3(a)) made or to be made by Lessee. NOTE: Lessee is responsible for determining whether or not the Applicable Requirements, and especially the zoning, are appropriate for Lessee's intended use, and acknowledges that past uses of the Premises may no longer be allowed. If the Premises do not comply with said warranty, Lessor shall, except as otherwise provided, promptly after receipt of written notice from Lessee setting forth with specificity the nature and extent of such non-compliance, rectify the same at Lessor's expense. If Lessee does not give Lessor written notice of a non-compliance with this warranty within 6 months following the Start Date, correction of that non-compliance shall be the obligation of Lessee at Lessee's sole cost and expense. If the Applicable Requirements are hereafter changed so as to require during the term of this Lease the construction of an addition to or an alteration of the Premises and/or Building, the remediation of any Hazardous Substance, or the reinforcement or other physical modification of the Unit, Premises and/or Building ("Capital Expenditure"), Lessor and Lessee shall allocate the cost of such work as follows: (a) Subject to Paragraph 2.3(c) below, if such Capital Expenditures are required as a result of the specific and unique use of the Premises by Lessee as compared with uses by tenants in general, Lessee shall be fully responsible for the cost thereof, provided, however that if such Capital Expenditure is required during the last 2 years of this Lease and the cost thereof exceeds 6 months' Base Rent, Lessee may instead terminate this Lease unless Lessor notifies Lessee, in writing, within 10 days after receipt of Lessee's termination notice that Lessor has elected to pay the difference between the actual cost thereof and an amount equal to 6 months' Base Rent. If Lessee elects termination, Lessee shall immediately cease the use of the Premises which requires such Capital Expenditure and deliver to Lessor written notice specifying a termination date at least 90 days thereafter. Such termination date shall, however, in no event be earlier than the last day that Lessee could legally utilize the Premises without commencing such Capital Expenditure. (b) If such Capital Expenditure is not the result of the specific and unique use of the Premises by Lessee (such as, governmentally mandated seismic modifications), then Lessor shall pay for such Capital Expenditure and Lessee shall only be obligated to pay, each month during the remainder of the term of this Lease or any extension thereof, on the date that on which the Base Rent is due, an amount equal to 1/144th of the portion of such costs reasonably attributable to the Premises. Lessee shall pay Interest on the balance but may prepay its obligation at any time. If, however, such Capital Expenditure is required during the last 2 years of this Lease or if Lessor reasonably determines that it is not economically feasible to pay its share thereof, Lessor shall have the option to terminate this Lease upon 90 days prior written notice to Lessee unless Lessee notifies Lessor, in writing, within 10 days after receipt of Lessor's termination notice that Lessee will pay for such Capital Expenditure. If Lessor does not elect to terminate, and fails to tender its share of any such Capital Expenditure, Lessee may advance such funds and deduct same, with Interest, PAGE 2 OF 19 INITIALS INITIALS © 2019 AIR CRE. All Rights Reserved. Produced with zipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com STG-27.40, Revised 11-25-2019 351 N Blackstone DocuSign Envelope ID: 7E1D49B4-3F86-4E92-8E6C-0DCCF8AE21D4 from Rent until Lessor's share of such costs have been fully paid. If Lessee is unable to finance Lessor's share, or if the balance of the Rent due and payable for the remainder of this Lease is not sufficient to fully reimburse Lessee on an offset basis, Lessee shall have the right to terminate this Lease upon 30 days written notice to Lessor. (c) Notwithstanding the above, the provisions concerning Capital Expenditures are intended to apply only to non-voluntary, unexpected, and new Applicable Requirements. If the Capital Expenditures are instead triggered by Lessee as a result of an actual or proposed change in use, change in intensity of use, or modification to the Premises then, and in that event, Lessee shall either: (i) immediately cease such changed use or intensity of use and/or take such other steps as may be necessary to eliminate the requirement for such Capital Expenditure, or (ii) complete such Capital Expenditure at its own expense. Lessee shall not, however, have any right to terminate this Lease. 2.4 Acknowledgements.Lessee acknowledges that: (a) it has been given an opportunity to inspect and measure the Premises, (b) it has been advised by Lessor and/or Brokers to satisfy itself with respect to the size and condition of the Premises (including but not limited to the electrical, HVAC and fire sprinkler systems, security, environmental aspects, and compliance with Applicable Requirements and the Americans with Disabilities Act), and their suitability for Lessee's intended use, (c) Lessee has made such investigation as it deems necessary with reference to such matters and assumes all responsibility therefor as the same relate to its occupancy of the Premises, (d) it is not relying on any representation as to the size of the Premises made by Brokers or Lessor, (e) the square footage of the Premises was not material to Lessee's decision to lease the Premises and pay the Rent stated herein, and (f) neither Lessor, Lessor's agents, nor Brokers have made any oral or written representations or warranties with respect to said matters other than as set forth in this Lease. In addition, Lessor acknowledges that: (i) Brokers have made no representations, promises or warranties concerning Lessee's ability to honor the Lease or suitability to occupy the Premises, and (ii) it is Lessor's sole responsibility to investigate the financial capability and/or suitability of all proposed tenants. 2.5 Lessee as Prior Owner/Occupant.The warranties made by Lessor in Paragraph 2 shall be of no force or effect if immediately priorto the Start Date Lessee was the owneroroccupantofthePremises.Insuchevent,Lesseeshallbe responsibleforanynecessary corrective work. 3.Term. 3.1 Term.The Commencement Date, Expiration Date and Original Term of this Lease are as specified in Paragraph 1.3. 3.2 Early Possession.Any provision herein granting Lessee Early Possession of the Premises is subject to and conditioned upon the Premises being available for such possession prior to the Commencement Date. Any grant of Early Possession only conveys a non-exclusive right to occupy the Premises. If Lessee totally or partially occupies the Premises prior to the Commencement Date, the obligation to pay Base Rent shall be abated for the period of such Early Possession. All other terms of this Lease (including but not limited to the obligations to pay Real Property Taxes and insurance premiums and to maintain the Premises) shall be in effect during such period. Any such Early Possession shall not affect the Expiration Date. 3.3 Delay In Possession.Lessor agrees to use its best commercially reasonable efforts to deliver possession of the Premises to Lessee by the Commencement Date. If, despite said efforts, Lessor is unable to deliver possession by such date, Lessor shall not be subject to any liability therefor, nor shall such failure affect the validity of this Lease or change the Expiration Date. Lessee shall not, however, be obligated to pay Rent or perform its other obligations until Lessor delivers possession of the Premises and any period of rent abatement that Lessee would otherwise have enjoyed shall run from the date of delivery of possession and continue for a period equal to what Lessee would otherwise have enjoyed under the terms hereof, but minus any days of delay caused by the acts or omissions of Lessee. If possession is not delivered within 60 days after the Commencement Date, as the same may be extended under the terms of any Work Letter executed by Parties, Lessee may, at its option, by notice in writing within 10 days after the end of such 60 day period, cancel this Lease, in which event the Parties shall be discharged from all obligations hereunder. If such written notice is not received by Lessor within said 10 day period, Lessee's right to cancel shall terminate. If possession of the Premises is not delivered within 120 days after the Commencement Date, this Lease shall terminate unless other agreements are reached between Lessor and Lessee, in writing. 3.4 Lessee Compliance.Lessor shall not be required to deliver possession of the Premises to Lessee until Lessee complies with its obligation to provide evidence of insurance (Paragraph 8.5). Pending delivery of such evidence, Lessee shall be required to perform all of its obligations under this Lease from and after the Start Date, including the payment of Rent, notwithstanding Lessor's election to withhold possession pending receipt of such evidence of insurance. Further, if Lessee is required to perform any other conditions prior to or concurrent with the Start Date, the Start Date shall occur but Lessor may elect to withhold possession until such conditions are satisfied. 4.Rent. 4.1 Rent Defined.All monetary obligations of Lessee to Lessor under the terms of this Lease (except for the Security Deposit) are deemed to be rent ("Rent"). 4.2 Payment.Lessee shall cause payment of Rent to be received by Lessor in lawful money of the United States, without offset or deduction (except as specifically permitted in this Lease), on or before the day on which it is due. All monetary amounts shall be rounded to the nearest whole dollar. In the event that any invoice prepared by Lessor is inaccurate such inaccuracy shall not constitute a waiver and Lessee shall be obligated to pay the amount set forth in this Lease. Rent for any period during the term hereof which is for less than one full calendar month shall be prorated based upon the actual number of days of said month. Payment of Rent shall be made to Lessor at its address stated herein or to such other persons or place as Lessor may from time to time designate in writing. Acceptance of a payment which is less than the amount then due shall not be a waiver of Lessor's rights to the balance of such Rent, regardless of Lessor's endorsement of any check so stating. In the event that any check, draft, or other instrument of payment given by Lessee to Lessor is dishonored for any reason, Lessee agrees to pay to Lessor the sum of $25 in addition to any Late Charge and Lessor, at its option, may require all future payments to be made by Lessee to be by cashier's check. Payments will be applied first to accrued late charges and attorney's fees, second to accrued interest, then to Base Rent, Insurance and Real Property Taxes, and any remaining amount to any other outstanding charges or costs. 4.3 Association Fees.In addition to the Base Rent, Lessee shall pay to Lessor each month an amount equal to any owner's association or condominium fees levied or assessed against the Premises. Said monies shall be paid at the same time and in the same manner as the Base Rent. 5.Security Deposit.Lessee shall deposit with Lessor upon execution hereof the Security Deposit as security for Lessee's faithful performance of its obligations under this Lease. If Lessee fails to pay Rent, or otherwise Defaults under this Lease, Lessor may use, apply or retain all or any portion of said Security Deposit for the payment of any amount already due Lessor, for Rents which will be due in the future, and/ or to reimburse or compensate Lessor for any liability, expense, loss or damage which Lessor may suffer or incur by reason thereof. If Lessor uses or applies all or any portion of the Security Deposit, Lessee shall within 10 days after written request therefor deposit monies with Lessor sufficient to restore said PAGE 3 OF 19 INITIALSINITIALS STG-27.40, Revised 11-25-2019© 2019 AIR CRE. All Rights Reserved. Produced with zipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com 351 N Blackstone DocuSign Envelope ID: 7E1D49B4-3F86-4E92-8E6C-0DCCF8AE21D4 Security Deposit to the full amount required by this Lease. If the Base Rent increases during the term of this Lease, Lessee shall, upon written request from Lessor, deposit additional monies with Lessor so that the total amount of the Security Deposit shall at all times bear the same proportion to the increased Base Rent as the initial Security Deposit bore to the initial Base Rent. Should the Agreed Use be amended to accommodate a material change in the business of Lessee or to accommodate a sublessee or assignee, Lessor shall have the right to increase the Security Deposit to the extent necessary, in Lessor's reasonable judgment, to account for any increased wear and tear that the Premises may suffer as a result thereof. If a change in control of Lessee occurs during this Lease and following such change the financial condition of Lessee is, in Lessor's reasonable judgment, significantly reduced, Lessee shall deposit such additional monies with Lessor as shall be sufficient to cause the Security Deposit to be at a commercially reasonable level based on such change in financial condition. Lessor shall not be required to keep the Security Deposit separate from its general accounts. Within 90 days after the expiration or termination of this Lease, Lessor shall return that portion of the Security Deposit not used or applied by Lessor. Lessor shall upon written request provide Lessee with an accounting showing how that portion of the Security Deposit that was not returned was applied. No part of the Security Deposit shall be considered to be held in trust, to bear interest or to be prepayment for any monies to be paid by Lessee under this Lease. THE SECURITY DEPOSIT SHALL NOT BE USED BY LESSEE IN LIEU OF PAYMENT OF THE LAST MONTH’S RENT. 6.Use. 6.1 Use.Lessee shall use and occupy the Premises only for the Agreed Use, or any other legal use which is reasonably comparable thereto, and for no other purpose. Lessee shall not use or permit the use of the Premises in a manner that is unlawful, creates damage, waste or a nuisance, or that disturbs occupants of or causes damage to neighboring premises or properties. Other than guide, signal and seeing eye dogs, Lessee shall not keep or allow in the Premises any pets, animals, birds, fish, or reptiles. Lessor shall not unreasonably withhold or delay its consent to any request for a modification of the Agreed Use, so long as the same will not impair the structural integrity of the improvements on the Premises or the mechanical or electrical systems therein, and/or is not significantly more burdensome to the Premises. If Lessor elects to withhold consent, Lessor shall within 7 days after such request give written notification of same, which notice shall include an explanation of Lessor's objections to the change in the Agreed Use. 6.2 Hazardous Substances. (a)Reportable Uses Require Consent.The term "Hazardous Substance"as used in this Lease shall mean any product, substance, or waste whose presence, use, manufacture, disposal, transportation, or release, either by itself or in combination with other materials expected to be on the Premises, is either: (i) potentially injurious to the public health, safety or welfare, the environment or the Premises, (ii) regulated or monitored by any governmental authority, or (iii) a basis for potential liability of Lessor to any governmental agency or third party under any applicable statute or common law theory. Hazardous Substances shall include, but not be limited to, hydrocarbons, petroleum, gasoline, and/or crude oil or any products, by-products or fractions thereof. Lessee shall not engage in any activity in or on the Premises which constitutes a Reportable Use of Hazardous Substances without the express prior written consent of Lessor and timely compliance (at Lessee's expense) with all Applicable Requirements."Reportable Use"shall mean (i) the installation or use of any above or below ground storage tank, (ii) the generation, possession, storage, use, transportation, or disposal of a Hazardous Substance that requires a permit from, or with respect to which a report, notice, registration or business plan is required to be filed with, any governmental authority, and/or (iii) the presence at the Premises of a Hazardous Substance with respect to which any Applicable Requirements requires that a notice be given to persons entering or occupying the Premises or neighboring properties. Notwithstanding the foregoing, Lessee may use any ordinary and customary materials reasonably required to be used in the normal course of the Agreed Use, ordinary office supplies (copier toner, liquid paper, glue, etc.) and common household cleaning materials, so long as such use is in compliance with all Applicable Requirements, is not a Reportable Use, and does not expose the Premises or neighboring property to any meaningful risk of contamination or damage or expose Lessor to any liability therefor. In addition, Lessor may condition its consent to any Reportable Use upon receiving such additional assurances as Lessor reasonably deems necessary to protect itself, the public, the Premises and/or the environment against damage, contamination, injury and/or liability, including, but not limited to, the installation (and removal on or before Lease expiration or termination) of protective modifications (such as concrete encasements) and/or increasing the Security Deposit. (b)Duty to Inform Lessor.If Lessee knows, or has reasonable cause to believe, that a Hazardous Substance has come to be located in, on, under or about the Premises, other than as previously consented to by Lessor, Lessee shall immediately give written notice of such fact to Lessor, and provide Lessor with a copy of any report, notice, claim or other documentation which it has concerning the presence of such Hazardous Substance. (c)Lessee Remediation.Lessee shall not cause or permit any Hazardous Substance to be spilled or released in, on, under, or about the Premises (including through the plumbing or sanitary sewer system) and shall promptly, at Lessee's expense, comply with all Applicable Requirements and take all investigatory and/or remedial action reasonably recommended, whether or not formally ordered or required, for the cleanup of any contamination of, and for the maintenance, security and/or monitoring of the Premises or neighboring properties, that was caused or materially contributed to by Lessee, or pertaining to or involving any Hazardous Substance brought onto the Premises during the term of this Lease, by or for Lessee, or any third party. (d)Lessee Indemnification.Lessee shall indemnify, defend and hold Lessor, its agents, employees, lenders and ground lessor, if any, harmless from and against any and all loss of rents and/or damages, liabilities, judgments, claims, expenses, penalties, and attorneys' and consultants' fees arising out of or involving any Hazardous Substance brought onto the Premises by or for Lessee, or any third party (provided, however, that Lessee shall have no liability under this Lease with respect to underground migration of any Hazardous Substance under the Premises from adjacent properties not caused or contributed to by Lessee). Lessee's obligations shall include, but not be limited to, the effects of any contamination or injury to person, property or the environment created or suffered by Lessee, and the cost of investigation, removal, remediation, restoration and/or abatement, and shall survive the expiration or termination of this Lease.No termination, cancellation or release agreement entered into by Lessor and Lessee shall release Lessee from its obligations under this Lease with respect to Hazardous Substances, unless specifically so agreed by Lessor in writing at the time of such agreement. (e)Lessor Indemnification.Except as otherwise provided in paragraph 8.7, Lessor and its successors and assigns shall indemnify, defend, reimburse and hold Lessee, its employees and lenders, harmless from and against any and all environmental damages, including the cost of remediation, which result from Hazardous Substances which existed on the Premises prior to Lessee's occupancy or which are caused by PAGE 4 OF 19 INITIALS INITIALS STG-27.40, Revised 11-25-2019© 2019 AIR CRE. All Rights Reserved. Produced with zipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com 351 N Blackstone DocuSign Envelope ID: 7E1D49B4-3F86-4E92-8E6C-0DCCF8AE21D4 the gross negligence or willful misconduct of Lessor, its agents or employees. Lessor's obligations, as and when required by the Applicable Requirements, shall include, but not be limited to, the cost of investigation, removal, remediation, restoration and/or abatement, and shall survive the expiration or termination of this Lease. (f)Investigations and Remediations.Lessor shall retain the responsibility and pay for any investigations or remediation measures required by governmental entities having jurisdiction with respect to the existence of Hazardous Substances on the Premises prior to Lessee's occupancy, unless such remediation measure is required as a result of Lessee's use (including "Alterations", as defined in Paragraph 7.3(a) below) of the Premises, in which event Lessee shall be responsible for such payment. Lessee shall cooperate fully in any such activities at the request of Lessor, including allowing Lessor and Lessor's agents to have reasonable access to the Premises at reasonable times in order to carry out Lessor's investigative and remedial responsibilities. (g)Lessor Termination Option.If a Hazardous Substance Condition (see Paragraph 9.1(e)) occurs during the term of this Lease, unless Lessee is legally responsible therefor (in which case Lessee shall make the investigation and remediation thereof required by the Applicable Requirements and this Lease shall continue in full force and effect, but subject to Lessor's rights under Paragraph 6.2(d) and Paragraph 13), Lessor may, at Lessor's option, either (i) investigate and remediate such Hazardous Substance Condition, if required, as soon as reasonably possible at Lessor's expense, in which event this Lease shall continue in full force and effect, or (ii) if the estimated cost to remediate such condition exceeds 12 times the then monthly Base Rent or $100,000, whichever is greater, give written notice to Lessee, within 30 days after receipt by Lessor of knowledge of the occurrence of such Hazardous Substance Condition, of Lessor's desire to terminate this Lease as of the date 60 days following the date of such notice. In the event Lessor elects to give a termination notice, Lessee may, within 10 days thereafter, give written notice to Lessor of Lessee's commitment to pay the amount by which the cost of the remediation of such Hazardous Substance Condition exceeds an amount equal to 12 times the then monthly Base Rent or $100,000, whichever is greater. Lessee shall provide Lessor with said funds or satisfactory assurance thereof within 30 days following such commitment. In such event, this Lease shall continue in full force and effect, and Lessor shall proceed to make such remediation as soon as reasonably possible after the required funds are available. If Lessee does not give such notice and provide the required funds or assurance thereof within the time provided, this Lease shall terminate as of the date specified in Lessor's notice of termination. 6.3 Lessee's Compliance with Applicable Requirements.Except as otherwise provided in this Lease, Lessee shall, at Lessee's sole expense, fully, diligently and in a timely manner, materially comply with all Applicable Requirements, the requirements of any applicable fire insurance underwriter or rating bureau, and the recommendations of Lessor's engineers and/or consultants which relate in any manner to the Premises, without regard to whether said Applicable Requirements are now in effect or become effective after the Start Date. Lessee shall, within 10 days after receipt of Lessor's written request, provide Lessor with copies of all permits and other documents, and other information evidencing Lessee's compliance with any Applicable Requirements specified by Lessor, and shall immediately upon receipt, notify Lessor in writing (with copies of any documents involved) of any threatened or actual claim, notice, citation, warning, complaint or report pertaining to or involving the failure of Lessee or the Premises to comply with any Applicable Requirements. Likewise, Lessee shall immediately give written notice to Lessor of: (i) any water damage to the Premises and any suspected seepage, pooling, dampness or other condition conducive to the production of mold; or (ii) any mustiness or other odors that might indicate the presence of mold in the Premises. In addition, Lessee shall provide Lessor with copies of its business license, certificate of occupancy and/or any similar document within 10 days of the receipt of a written request therefor. 6.4 Inspection; Compliance.Lessor and Lessor's "Lender"(as defined in Paragraph 30) and consultants authorized by Lessor shall have the right to enter into Premises at any time, in the case of an emergency, and otherwise at reasonable times after reasonable notice, for the purpose of inspecting and/or testing the condition of the Premises and/or for verifying compliance by Lessee with this Lease. The cost of any such inspections shall be paid by Lessor, unless a violation of Applicable Requirements, or a Hazardous Substance Condition (see paragraph 9.1) is found to exist or be imminent, or the inspection is requested or ordered by a governmental authority. In such case, Lessee shall upon request reimburse Lessor for the cost of such inspection, so long as such inspection is reasonably related to the violation or contamination. In addition, Lessee shall provide copies of all relevant material safety data sheets (MSDS) to Lessor within 10 days of the receipt of a written request therefor. Lessee acknowledges that any failure on its part to allow such inspections or testing will expose Lessor to risks and potentially cause Lessor to incur costs not contemplated by this Lease, the extent of which will be extremely difficult to ascertain. Accordingly, should the Lessee fail to allow such inspections and/or testing in a timely fashion the Base Rent shall be automatically increased, without any requirement for notice to Lessee, by an amount equal to 10% of the then existing Base Rent or $100, whichever is greater for the remainder to the Lease. The Parties agree that such increase in Base Rent represents fair and reasonable compensation for the additional risk/costs that Lessor will incur by reason of Lessee's failure to allow such inspection and/or testing. Such increase in Base Rent shall in no event constitute a waiver of Lessee's Default or Breach with respect to such failure nor prevent the exercise of any of the other rights and remedies granted hereunder. 7.Maintenance; Repairs; Utility Installations; Trade Fixtures and Alterations. 7.1 Lessee's Obligations. (a)In General.Subject to the provisions of Paragraph 2.2 (Condition), 2.3 (Compliance), 6.3 (Lessee's Compliance with Applicable Requirements), 7.2 (Lessor's Obligations), 9 (Damage or Destruction), and 14 (Condemnation), Lessee shall, at Lessee's sole expense, keep the Premises, Utility Installations (intended for Lessee's exclusive use, no matter where located), and Alterations in good order, condition and repair (whether or not the portion of the Premises requiring repairs, or the means of repairing the same, are reasonably or readily accessible to Lessee, and whether or not the need for such repairs occurs as a result of Lessee's use, any prior use, the elements or the age of such portion of the Premises), including, but not limited to, all equipment or facilities, such as plumbing, HVAC equipment, electrical, lighting facilities, boilers, pressure vessels, fire protection system, fixtures, walls (interior and exterior), ceilings, floors, stairs, windows, doors, plate glass, skylights, landscaping, driveways, parking lots, fences, retaining walls, signs, sidewalks and parkways located in, on, or adjacent to the Premises. Lessee is also responsible for keeping the roof and roof drainage clean and free of debris. Lessor shall keep the surface and structural elements of the roof, foundations, and bearing walls in good repair (see paragraph 7.2). Lessee, in keeping the Premises in good order, condition and repair, shall exercise and perform good maintenance practices, specifically including the procurement and maintenance of the service contracts required by Paragraph 7.1(b) below. Lessee's obligations shall include restorations, replacements or renewals when necessary to keep the Premises and all improvements thereon or a part thereof in good order, condition and state of repair. Lessee shall, during the term of this Lease, keep the exterior appearance of the Building in a first-class condition (including, e.g. graffiti removal) consistent with the exterior appearance of other similar facilities of comparable age and size in the vicinity, including, when necessary, the exterior repainting of the Building. PAGE 5 OF 19 INITIALS INITIALS STG-27.40, Revised 11-25-2019© 2019 AIR CRE. All Rights Reserved. Produced with zipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com 351 N Blackstone DocuSign Envelope ID: 7E1D49B4-3F86-4E92-8E6C-0DCCF8AE21D4 (b)Service Contracts.Lessee shall, at Lessee's sole expense, procure and maintain contracts, with copies to Lessor, in customary form and substance for, and with contractors specializing and experienced in the maintenance of the following equipment and improvements, if any, if and when installed on the Premises: (i) HVAC equipment, (ii) boiler, and pressure vessels, (iii) fire extinguishing systems, including fire alarm and/or smoke detection, (iv) landscaping and irrigation systems, and (v) clarifiers. However, Lessor reserves the right, upon notice to Lessee, to procure and maintain any or all of such service contracts, and Lessee shall reimburse Lessor, upon demand, for the cost thereof. (c)Failure to Perform.If Lessee fails to perform Lessee's obligations under this Paragraph 7.1, Lessor may enter upon the Premises after 10 days' prior written notice to Lessee (except in the case of an emergency, in which case no notice shall be required), perform such obligations on Lessee's behalf, and put the Premises in good order, condition and repair, and Lessee shall promptly pay to Lessor a sum equal to 115% of the cost thereof. (d)Replacement.Subject to Lessee's indemnification of Lessor as set forth in Paragraph 8.7 below, and without relieving Lessee of liability resulting from Lessee's failure to exercise and perform good maintenance practices, if an item described in Paragraph 7.1(b) cannot be repaired other than at a cost which is in excess of 50% of the cost of replacing such item, then such item shall be replaced by Lessor, and the cost thereof shall be prorated between the Parties and Lessee shall only be obligated to pay, each month during the remainder of the term of this Lease or any extension thereof, on the date on which Base Rent is due, an amount equal to the product of multiplying the cost of such replacement by a fraction, the numerator of which is one, and the denominator of which is 144 (ie. 1/144th of the cost per month). Lessee shall pay Interest on the unamortized balance but may prepay its obligation at any time. 7.2 Lessor's Obligations.Subject to the provisions of Paragraphs 2.2 (Condition), 2.3 (Compliance), 9 (Damage or Destruction) and 14 (Condemnation), it is intended by the Parties hereto that Lessor have no obligation, in any manner whatsoever, to repair and maintain the Premises, or the equipment therein, all of which obligations are intended to be that of the Lessee, except for the surface and structural elements of the roof, foundations and bearing walls, the repair of which shall be the responsibility of Lessor upon receipt of written notice that such a repair is necessary. It is the intention of the Parties that the terms of this Lease govern the respective obligations of the Parties as to maintenance and repair of the Premises, and they expressly waive the benefit of any statute now or hereafter in effect to the extent it is inconsistent with the terms of this Lease. 7.3 Utility Installations; Trade Fixtures; Alterations. (a)Definitions.The term "Utility Installations"refers to all floor and window coverings, air and/or vacuum lines, power panels, electrical distribution, security and fire protection systems, communication cabling, lighting fixtures, HVAC equipment, plumbing, and fencing in or on the Premises. The term "Trade Fixtures"shall mean Lessee's machinery and equipment that can be removed without doing material damage to the Premises. The term "Alterations"shall mean any modification of the improvements, other than Utility Installations or Trade Fixtures, whether by addition or deletion."Lessee Owned Alterations and/or Utility Installations"are defined as Alterations and/or Utility Installations made by Lessee that are not yet owned by Lessor pursuant to Paragraph 7.4(a). (b)Consent.Lessee shall not make any Alterations or Utility Installations to the Premises without Lessor's prior written consent. Lessee may, however, make non-structural Alterations or Utility Installations to the interior of the Premises (excluding the roof) without such consent but upon notice to Lessor, as long as they are not visible from the outside, do not involve puncturing, relocating or removing the roof or any existing walls, will not affect the electrical, plumbing, HVAC, and/or life safety systems, do not trigger the requirement for additional modifications and/or improvements to the Premises resulting from Applicable Requirements, such as compliance with Title 24, and the cumulative cost thereof during this Lease as extended does not exceed a sum equal to 3 month's Base Rent in the aggregate or a sum equal to one month's Base Rent in any one year. Notwithstanding the foregoing, Lessee shall not make or permit any roof penetrations and/or install anything on the roof without the prior written approval of Lessor. Lessor may, as a precondition to granting such approval, require Lessee to utilize a contractor chosen and/or approved by Lessor. Any Alterations or Utility Installations that Lessee shall desire to make and which require the consent of the Lessor shall be presented to Lessor in written form with detailed plans. Consent shall be deemed conditioned upon Lessee's: (i) acquiring all applicable governmental permits, (ii) furnishing Lessor with copies of both the permits and the plans and specifications prior to commencement of the work, and (iii) compliance with all conditions of said permits and other Applicable Requirements in a prompt and expeditious manner. Any Alterations or Utility Installations shall be performed in a workmanlike manner with good and sufficient materials. Lessee shall promptly upon completion furnish Lessor with as-built plans and specifications. For work which costs an amount in excess of one month's Base Rent, Lessor may condition its consent upon Lessee providing a lien and completion bond in an amount equal to 150% of the estimated cost of such Alteration or Utility Installation and/or upon Lessee's posting an additional Security Deposit with Lessor. (c)Liens; Bonds.Lessee shall pay, when due, all claims for labor or materials furnished or alleged to have been furnished to or for Lessee at or for use on the Premises, which claims are or may be secured by any mechanic's or materialmen's lien against the Premises or any interest therein. Lessee shall give Lessor not less than 10 days notice prior to the commencement of any work in, on or about the Premises, and Lessor shall have the right to post notices of non-responsibility. If Lessee shall contest the validity of any such lien, claim or demand, then Lessee shall, at its sole expense defend and protect itself, Lessor and the Premises against the same and shall pay and satisfy any such adverse judgment that may be rendered thereon before the enforcement thereof. If Lessor shall require, Lessee shall furnish a surety bond in an amount equal to 150% of the amount of such contested lien, claim or demand, indemnifying Lessor against liability for the same. If Lessor elects to participate in any such action, Lessee shall pay Lessor's attorneys' fees and costs. 7.4 Ownership; Removal; Surrender; and Restoration. (a)Ownership.Subject to Lessor's right to require removal or elect ownership as hereinafter provided, all Alterations and Utility Installations made by Lessee shall be the property of Lessee, but considered a part of the Premises. Lessor may, at any time, elect in writing to be the owner of all or any specified part of the Lessee Owned Alterations and Utility Installations. Unless otherwise instructed per Paragraph 7.4(b) hereof, all Lessee Owned Alterations and Utility Installations shall, at the expiration or termination of this Lease, become the property of Lessor and be surrendered by Lessee with the Premises. (b)Removal.By delivery to Lessee of written notice from Lessor not earlier than 90 and not later than 30 days prior to the end of the term of this Lease, Lessor may require that any or all Lessee Owned Alterations or Utility Installations be removed by the expiration or termination of this Lease. Lessor may require the removal at any time of all or any part of any Lessee Owned Alterations or Utility Installations made without the required consent. PAGE 6 OF 19 INITIALS INITIALS STG-27.40, Revised 11-25-2019© 2019 AIR CRE. All Rights Reserved. Produced with zipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com 351 N Blackstone DocuSign Envelope ID: 7E1D49B4-3F86-4E92-8E6C-0DCCF8AE21D4 (c)Surrender; Restoration.Lessee shall surrender the Premises by the Expiration Date or any earlier termination date, with all of the improvements, parts and surfaces thereof broom clean and free of debris, and in good operating order, condition and state of repair, ordinary wear and tear excepted. "Ordinary wear and tear" shall not include any damage or deterioration that would have been prevented by good maintenance practice. Notwithstanding the foregoing and the provisions of Paragraph 7.1(a), if the Lessee occupies the Premises for 12 months or less, then Lessee shall surrender the Premises in the same condition as delivered to Lessee on the Start Date with NO allowance for ordinary wear and tear. Lessee shall repair any damage occasioned by the installation, maintenance or removal of Trade Fixtures, Lessee owned Alterations and/or Utility Installations, furnishings, and equipment as well as the removal of any storage tank installed by or for Lessee. Lessee shall completely remove from the Premises any and all Hazardous Substances brought onto the Premises by or for Lessee, or any third party (except Hazardous Substances which were deposited via underground migration from areas outside of the Premises) even if such removal would require Lessee to perform or pay for work that exceeds statutory requirements. Trade Fixtures shall remain the property of Lessee and shall be removed by Lessee. Any personal property of Lessee not removed on or before the Expiration Date or any earlier termination date shall be deemed to have been abandoned by Lessee and may be disposed of or retained by Lessor as Lessor may desire. The failure by Lessee to timely vacate the Premises pursuant to this Paragraph 7.4(c) without the express written consent of Lessor shall constitute a holdover under the provisions of Paragraph 26 below. 8.Insurance; Indemnity. 8.1 Payment of Premium Increases. (a) Lessee shall pay to Lessor any insurance cost increase ("Insurance Cost Increase") occurring during the term of this Lease. Insurance Cost Increase is defined as any increase in the actual cost of the insurance required under Paragraph 8.2(b), 8.3(a) and 8.3(b), over and above the Base Premium as hereinafter defined calculated on an annual basis. Insurance Cost Increase shall include but not be limited to increases resulting from the nature of Lessee's occupancy, any act or omission of Lessee, requirements of the holder of mortgage or deed of trust covering the Premises, increased valuation of the Premises and/or a premium rate increase. The parties are encouraged to fill in the Base Premium in paragraph 1.8 with a reasonable premium for the Required Insurance based on the Agreed Use of the Premises. If the parties fail to insert a dollar amount in Paragraph 1.8, then the Base Premium shall be the lowest annual premium reasonably obtainable for the Required Insurance as of the commencement of the Original Term for the Agreed Use of the Premises. In no event, however, shall Lessee be responsible for any portion of the increase in the premium cost attributable to liability insurance carried by Lessor under Paragraph 8.2(b) in excess of $2,000,000 per occurrence. (b) Lessee shall pay any such Insurance Cost Increase to Lessor within 30 days after receipt by Lessee of a copy of the premium statement or other reasonable evidence of the amount due. If the insurance policies maintained hereunder cover other property besides the Premises, Lessor shall also deliver to Lessee a statement of the amount of such Insurance Cost Increase attributable only to the Premises showing in reasonable detail the manner in which such amount was computed. Premiums for policy periods commencing prior to, or extending beyond the term of this Lease, shall be prorated to correspond to the term of this Lease. 8.2 Liability Insurance. (a)Carried by Lessee.Lessee shall obtain and keep in force a Commercial General Liability policy of insurance protecting Lessee and Lessor as an additional insured against claims for bodily injury, personal injury and property damage based upon or arising out of the ownership, use, occupancy or maintenance of the Premises and all areas appurtenant thereto. Such insurance shall be on an occurrence basis providing single limit coverage in an amount not less than $1,000,000 per occurrence with an annual aggregate of not less than $2,000,000. Lessee shall add Lessor as an additional insured by means of an endorsement at least as broad as the Insurance Service Organization's "Additional Insured-Managers or Lessors of Premises" Endorsement. The policy shall not contain any intra-insured exclusions as between insured persons or organizations, but shall include coverage for liability assumed under this Lease as an "insured contract"for the performance of Lessee's indemnity obligations under this Lease. The limits of said insurance shall not, however, limit the liability of Lessee nor relieve Lessee of any obligation hereunder. Lessee shall provide an endorsement on its liability policy(ies) which provides that its insurance shall be primary to and not contributory with any similar insurance carried by Lessor, whose insurance shall be considered excess insurance only. (b)Carried by Lessor.Lessor shall maintain liability insurance as described in Paragraph 8.2(a), in addition to, and not in lieu of, the insurance required to be maintained by Lessee. Lessee shall not be named as an additional insured therein. 8.3 Property Insurance - Building, Improvements and Rental Value. (a)Building and Improvements.The Insuring Party shall obtain and keep in force a policy or policies in the name of Lessor, with loss payable to Lessor, any ground-lessor, and to any Lender insuring loss or damage to the Premises. The amount of such insurance shall be equal to the full insurable replacement cost of the Premises, as the same shall exist from time to time, or the amount required by any Lender, but in no event more than the commercially reasonable and available insurable value thereof. Lessee Owned Alterations and Utility Installations, Trade Fixtures, and Lessee's personal property shall be insured by Lessee not by Lessor. If the coverage is available and commercially appropriate, such policy or policies shall insure against all risks of direct physical loss or damage (except the perils of flood and/or earthquake unless required by a Lender or included in the Base Premium), including coverage for debris removal and the enforcement of any Applicable Requirements requiring the upgrading, demolition, reconstruction or replacement of any portion of the Premises as the result of a covered loss. Said policy or policies shall also contain an agreed valuation provision in lieu of any coinsurance clause, waiver of subrogation, and inflation guard protection causing an increase in the annual property insurance coverage amount by a factor of not less than the adjusted U.S. Department of Labor Consumer Price Index for All Urban Consumers for the city nearest to where the Premises are located. If such insurance coverage has a deductible clause, the deductible amount shall not exceed $5,000 per occurrence, and Lessee shall be liable for such deductible amount in the event of an Insured Loss. (b)Rental Value.The Insuring Party shall obtain and keep in force a policy or policies in the name of Lessor with loss payable to Lessor and any Lender, insuring the loss of the full Rent for one year with an extended period of indemnity for an additional 180 days ("Rental Value Insurance"). Said insurance shall contain an agreed valuation provision in lieu of any coinsurance clause, and the amount of coverage shall be adjusted annually to reflect the projected Rent otherwise payable by Lessee, for the next 12 month period. Lessee shall be liable for any deductible amount in the event of such loss. (c)Adjacent Premises.If the Premises are part of a larger building, or of a group of buildings owned by Lessor which are adjacent to the Premises, the Lessee shall pay for any increase in the premiums for the property insurance of such building or buildings if said increase is caused by Lessee's acts, omissions, use or occupancy of the Premises. PAGE 7 OF 19 INITIALS INITIALS STG-27.40, Revised 11-25-2019© 2019 AIR CRE. All Rights Reserved. Produced with zipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com 351 N Blackstone DocuSign Envelope ID: 7E1D49B4-3F86-4E92-8E6C-0DCCF8AE21D4 8.4 Lessee's Property; Business Interruption Insurance; Worker's Compensation Insurance. (a)Property Damage.Lessee shall obtain and maintain insurance coverage on all of Lessee's personal property, Trade Fixtures, and Lessee Owned Alterations and Utility Installations. Such insurance shall be full replacement cost coverage with a deductible of not to exceed $1,000 per occurrence. The proceeds from any such insurance shall be used by Lessee for the replacement of personal property, Trade Fixtures and Lessee Owned Alterations and Utility Installations. (b)Business Interruption.Lessee shall obtain and maintain loss of income and extra expense insurance in amounts as will reimburse Lessee for direct or indirect loss of earnings attributable to all perils commonly insured against by prudent lessees in the business of Lessee or attributable to prevention of access to the Premises as a result of such perils. (c)Worker's Compensation Insurance.Lessee shall obtain and maintain Worker's Compensation Insurance in such amount as may be required by Applicable Requirements. Such policy shall include a ‘Waiver of Subrogation’ endorsement. Lessee shall provide Lessor with a copy of such endorsement along with the certificate of insurance or copy of the policy required by paragraph 8.5. (d)No Representation of Adequate Coverage.Lessor makes no representation that the limits or forms of coverage of insurance specified herein are adequate to cover Lessee's property, business operations or obligations under this Lease. 8.5 Insurance Policies.Insurance required herein shall be by companies maintaining during the policy term a "General Policyholders Rating" of at least A-, VII, as set forth in the most current issue of "Best's Insurance Guide", or such other rating as may be required by a Lender. Lessee shall not do or permit to be done anything which invalidates the required insurance policies. Lessee shall, prior to the Start Date, deliver to Lessor certified copies of policies of such insurance or certificates with copies of the required endorsements evidencing the existence and amounts of the required insurance. No such policy shall be cancelable or subject to modification except after 30 days prior written notice to Lessor. Lessee shall, at least 10 days prior to the expiration of such policies, furnish Lessor with evidence of renewals or "insurance binders" evidencing renewal thereof, or Lessor may increase his liability insurance coverage and charge the cost thereof to Lessee, which amount shall be payable by Lessee to Lessor upon demand. Such policies shall be for a term of at least one year, or the length of the remaining term of this Lease, whichever is less. If either Party shall fail to procure and maintain the insurance required to be carried by it, the other Party may, but shall not be required to, procure and maintain the same. 8.6 Waiver of Subrogation.Without affecting any other rights or remedies, Lessee and Lessor each hereby release and relieve the other, and waive their entire right to recover damages against the other, for loss of or damage to its property arising out of or incident to the perils required to be insured against herein. The effect of such releases and waivers is not limited by the amount of insurance carried or required, or by any deductibles applicable hereto. The Parties agree to have their respective property damage insurance carriers waive any right to subrogation that such companies may have against Lessor or Lessee, as the case may be, so long as the insurance is not invalidated thereby. 8.7 Indemnity.Except for Lessor's gross negligence or willful misconduct, Lessee shall indemnify, protect, defend and hold harmless the Premises, Lessor and its agents, Lessor's master or ground lessor, partners and Lenders, from and against any and all claims, loss of rents and/or damages, liens, judgments, penalties, attorneys' and consultants' fees, expenses and/or liabilities arising out of, involving, or in connection with, the use and/or occupancy of the Premises by Lessee. If any action or proceeding is brought against Lessor by reason of any of the foregoing matters, Lessee shall upon notice defend the same at Lessee's expense by counsel reasonably satisfactory to Lessor and Lessor shall cooperate with Lessee in such defense. Lessor need not have first paid any such claim in order to be defended or indemnified. 8.8 Exemption of Lessor and its Agents from Liability.Notwithstanding the negligence or breach of this Lease by Lessor or its agents, neither Lessor nor its agents shall be liable under any circumstances for: (i) injury or damage to the person or goods, wares, merchandise or other property of Lessee, Lessee's employees, contractors, invitees, customers, or any other person in or about the Premises, whether such damage or injury is caused by or results from fire, steam, electricity, gas, water or rain, indoor air quality, the presence of mold or from the breakage, leakage, obstruction or other defects of pipes, fire sprinklers, wires, appliances, plumbing, HVAC or lighting fixtures, or from any other cause, whether the said injury or damage results from conditions arising upon the Premises or upon other portions of the building of which the Premises are a part, or from other sources or places, (ii) any damages arising from any act or neglect of any other tenant of Lessor or from the failure of Lessor or its agents to enforce the provisions of any other lease in the Project, or (iii) injury to Lessee's business or for any loss of income or profit therefrom. Instead, it is intended that Lessee's sole recourse in the event of such damages or injury be to file a claim on the insurance policy(ies) that Lessee is required to maintain pursuant to the provisions of paragraph 8. 8.9 Failure to Provide Insurance.Lessee acknowledges that any failure on its part to obtain or maintain the insurance required herein will expose Lessor to risks and potentially cause Lessor to incur costs not contemplated by this Lease, the extent of which will be extremely difficult to ascertain. Accordingly, for any month or portion thereof that Lessee does not maintain the required insurance and/or does not provide Lessor with the required binders or certificates evidencing the existence of the required insurance, the Base Rent shall be automatically increased, without any requirement for notice to Lessee, by an amount equal to 10% of the then existing Base Rent or $100, whichever is greater. The parties agree that such increase in Base Rent represents fair and reasonable compensation for the additional risk/costs that Lessor will incur by reason of Lessee's failure to maintain the required insurance. Such increase in Base Rent shall in no event constitute a waiver of Lessee's Default or Breach with respect to the failure to maintain such insurance, prevent the exercise of any of the other rights and remedies granted hereunder, nor relieve Lessee of its obligation to maintain the insurance specified in this Lease. 9.Damage or Destruction. 9.1 Definitions. (a)"Premises Partial Damage"shall mean damage or destruction to the improvements on the Premises, other than Lessee Owned Alterations and Utility Installations, which can reasonably be repaired in 6 months or less from the date of the damage or destruction. Lessor shall notify Lessee in writing within 30 days from the date of the damage or destruction as to whether or not the damage is Partial or Total. (b)"Premises Total Destruction"shall mean damage or destruction to the Premises, other than Lessee Owned Alterations and Utility Installations and Trade Fixtures, which cannot reasonably be repaired in 6 months or less from the date of the damage or destruction. Lessor shall notify Lessee in writing within 30 days from the date of the damage or destruction as to whether or not the damage is Partial or Total. (c)"Insured Loss"shall mean damage or destruction to improvements on the Premises, other than Lessee Owned Alterations and Utility Installations and Trade Fixtures, which was caused by an event required to be covered by the insurance described in Paragraph 8.3(a), irrespective of any deductible amounts or coverage limits involved. PAGE 8 OF 19 INITIALS INITIALS STG-27.40, Revised 11-25-2019© 2019 AIR CRE. All Rights Reserved. Produced with zipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com 351 N Blackstone DocuSign Envelope ID: 7E1D49B4-3F86-4E92-8E6C-0DCCF8AE21D4 (d)"Replacement Cost"shall mean the cost to repair or rebuild the improvements owned by Lessor at the time of the occurrence to their condition existing immediately prior thereto, including demolition, debris removal and upgrading required by the operation of Applicable Requirements, and without deduction for depreciation. (e)"Hazardous Substance Condition"shall mean the occurrence or discovery of a condition involving the presence of, or a contamination by, a Hazardous Substance, in, on, or under the Premises which requires restoration. 9.2 Partial Damage - Insured Loss.If a Premises Partial Damage that is an Insured Loss occurs, then Lessor shall, at Lessor's expense, repair such damage (but not Lessee's Trade Fixtures or Lessee Owned Alterations and Utility Installations) as soon as reasonably possible and this Lease shall continue in full force and effect; provided, however, that Lessee shall, at Lessor's election, make the repair of any damage or destruction the total cost to repair of which is $10,000 or less, and, in such event, Lessor shall make any applicable insurance proceeds available to Lessee on a reasonable basis for that purpose. Notwithstanding the foregoing, if the required insurance was not in force or the insurance proceeds are not sufficient to effect such repair, the Insuring Party shall promptly contribute the shortage in proceeds (except as to the deductible which is Lessee's responsibility) as and when required to complete said repairs. In the event, however, such shortage was due to the fact that, by reason of the unique nature of the improvements, full replacement cost insurance coverage was not commercially reasonable and available, Lessor shall have no obligation to pay for the shortage in insurance proceeds or to fully restore the unique aspects of the Premises unless Lessee provides Lessor with the funds to cover same, or adequate assurance thereof, within 10 days following receipt of written notice of such shortage and request therefor. If Lessor receives said funds or adequate assurance thereof within said 10 day period, the party responsible for making the repairs shall complete them as soon as reasonably possible and this Lease shall remain in full force and effect. If such funds or assurance are not received, Lessor may nevertheless elect by written notice to Lessee within 10 days thereafter to: (i) make such restoration and repair as is commercially reasonable with Lessor paying any shortage in proceeds, in which case this Lease shall remain in full force and effect, or (ii) have this Lease terminate 30 days thereafter. Lessee shall not be entitled to reimbursement of any funds contributed by Lessee to repair any such damage or destruction. Premises Partial Damage due to flood or earthquake shall be subject to Paragraph 9.3, notwithstanding that there may be some insurance coverage, but the net proceeds of any such insurance shall be made available for the repairs if made by either Party. 9.3 Partial Damage - Uninsured Loss.If a Premises Partial Damage that is not an Insured Loss occurs, unless caused by a negligent or willful act of Lessee (in which event Lessee shall make the repairs at Lessee's expense), Lessor may either: (i) repair such damage as soon as reasonably possible at Lessor's expense, in which event this Lease shall continue in full force and effect, or (ii) terminate this Lease by giving written notice to Lessee within 30 days after receipt by Lessor of knowledge of the occurrence of such damage. Such termination shall be effective 60 days following the date of such notice. In the event Lessor elects to terminate this Lease, Lessee shall have the right within 10 days after receipt of the termination notice to give written notice to Lessor of Lessee's commitment to pay for the repair of such damage without reimbursement from Lessor. Lessee shall provide Lessor with said funds or satisfactory assurance thereof within 30 days after making such commitment. In such event this Lease shall continue in full force and effect, and Lessor shall proceed to make such repairs as soon as reasonably possible after the required funds are available. If Lessee does not make the required commitment, this Lease shall terminate as of the date specified in the termination notice. 9.4 Total Destruction.Notwithstanding any other provision hereof, if a Premises Total Destruction occurs, this Lease shall terminate 60 days following such Destruction. If the damage or destruction was caused by the gross negligence or willful misconduct of Lessee, Lessor shall have the right to recover Lessor's damages from Lessee, except as provided in Paragraph 8.6. 9.5 Damage Near End of Term.If at any time during the last 6 months of this Lease there is damage for which the cost to repair exceeds one month's Base Rent, whether or not an Insured Loss, Lessor may terminate this Lease effective 60 days following the date of occurrence of such damage by giving a written termination notice to Lessee within 30 days after the date of occurrence of such damage. Notwithstanding the foregoing, if Lessee at that time has an exercisable option to extend this Lease or to purchase the Premises, then Lessee may preserve this Lease by, (a) exercising such option and (b) providing Lessor with any shortage in insurance proceeds (or adequate assurance thereof) needed to make the repairs on or before the earlier of (i) the date which is 10 days after Lessee's receipt of Lessor's written notice purporting to terminate this Lease, or (ii) the day prior to the date upon which such option expires. If Lessee duly exercises such option during such period and provides Lessor with funds (or adequate assurance thereof) to cover any shortage in insurance proceeds, Lessor shall, at Lessor's commercially reasonable expense, repair such damage as soon as reasonably possible and this Lease shall continue in full force and effect. If Lessee fails to exercise such option and provide such funds or assurance during such period, then this Lease shall terminate on the date specified in the termination notice and Lessee's option shall be extinguished. 9.6 Abatement of Rent; Lessee's Remedies. (a)Abatement.In the event of Premises Partial Damage or Premises Total Destruction or a Hazardous Substance Condition for which Lessee is not responsible under this Lease, the Rent payable by Lessee for the period required for the repair, remediation or restoration of such damage shall be abated in proportion to the degree to which Lessee's use of the Premises is impaired, but not to exceed the proceeds received from the Rental Value insurance. All other obligations of Lessee hereunder shall be performed by Lessee, and Lessor shall have no liability for any such damage, destruction, remediation, repair or restoration except as provided herein. (b)Remedies.If Lessor is obligated to repair or restore the Premises and does not commence, in a substantial and meaningful way, such repair or restoration within 90 days after such obligation shall accrue, Lessee may, at any time prior to the commencement of such repair or restoration, give written notice to Lessor and to any Lenders of which Lessee has actual notice, of Lessee's election to terminate this Lease on a date not less than 60 days following the giving of such notice. If Lessee gives such notice and such repair or restoration is not commenced within 30 days thereafter, this Lease shall terminate as of the date specified in said notice. If the repair or restoration is commenced within such 30 days, this Lease shall continue in full force and effect."Commence"shall mean either the unconditional authorization of the preparation of the required plans, or the beginning of the actual work on the Premises, whichever first occurs. 9.7 Termination; Advance Payments.Upon termination of this Lease pursuant to Paragraph 6.2(g) or Paragraph 9, an equitable adjustment shall be made concerning advance Base Rent and any other advance payments made by Lessee to Lessor. Lessor shall, in addition, return to Lessee so much of Lessee's Security Deposit as has not been, or is not then required to be, used by Lessor. PAGE 9 OF 19 INITIALS INITIALS STG-27.40, Revised 11-25-2019© 2019 AIR CRE. All Rights Reserved. Produced with zipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com 351 N Blackstone DocuSign Envelope ID: 7E1D49B4-3F86-4E92-8E6C-0DCCF8AE21D4 10.Real Property Taxes. 10.1 Definition.As used herein, the term "Real Property Taxes"shall include any form of assessment; real estate, general, special, ordinary or extraordinary, or rental levy or tax (other than inheritance, personal income or estate taxes); improvement bond; and/or license fee imposed upon or levied against any legal or equitable interest of Lessor in the Premises or the Project, Lessor's right to other income therefrom, and/or Lessor's business of leasing, by any authority having the direct or indirect power to tax and where the funds are generated with reference to the Building address. Real Property Taxes shall also include any tax, fee, levy, assessment or charge, or any increase therein: (i) imposed by reason of events occurring during the term of this Lease, including but not limited to, a change in the ownership of the Premises, and (ii) levied or assessed on machinery or equipment provided by Lessor to Lessee pursuant to this Lease. 10.2 Payment of Taxes.Lessor shall pay the Real Property Taxes applicable to the Premises provided, however, that Lessee shall pay to Lessor the amount, if any, by which Real Property Taxes applicable to the Premises increase over the fiscal tax year during which the Commencement Date Occurs (”Tax Increase“). Payment of any such Tax Increase shall be made by Lessee to Lessor within 30 days after receipt of Lessor’s written statement setting forth the amount due and computation thereof. If any such taxes shall cover any period of time prior to or after the expiration or termination of this Lease, Lessee’s share of such taxes shall be prorated to cover only that portion of the tax bill applicable to the period that this Lease is in effect. In the event Lessee incurs a late charge on any Rent payment, Lessor may estimate the current Real Property Taxes, and require that the Tax Increase be paid in advance to Lessor by Lessee monthly in advance with the payment of the Base Rent. Such monthly payment shall be an amount equal to the amount of the estimated installment of the Tax Increase divided by the number of months remaining before the month in which said installment becomes delinquent. When the actual amount of the applicable Tax Increase is known, the amount of such equal monthly advance payments shall be adjusted as required to provide the funds needed to pay the applicable Tax Increase. If the amount collected by Lessor is insufficient to pay the Tax Increase when due, Lessee shall pay Lessor, upon demand, such additional sums as are necessary to pay such obligations. Advance payments may be intermingled with other moneys of Lessor and shall not bear interest. In the event of a Breach by Lessee in the performance of its obligations under this Lease, then any such advance payments may be treated by Lessor as an additional Security Deposit. 10.3 Additional Improvements.Notwithstanding anything to the contrary in this Paragraph 10.2, Lessee shall pay to Lessor upon demand therefor the entirety of any increase in Real Property Taxes assessed by reason of Alterations or Utility Installations placed upon the Premises by Lessee or at Lessee's request or by reason of any alterations or improvements to the Premises made by Lessor subsequent to the execution of this Lease by the Parties. 10.4 Joint Assessment.If the Premises are not separately assessed, Lessee's liability shall be an equitable proportion of the Tax Increase for all of the land and improvements included within the tax parcel assessed, such proportion to be conclusively determined by Lessor from the respective valuations assigned in the assessor's work sheets or such other information as may be reasonably available. 10.5 Personal Property Taxes.Lessee shall pay, prior to delinquency, all taxes assessed against and levied upon Lessee Owned Alterations, Utility Installations, Trade Fixtures, furnishings, equipment and all personal property of Lessee. When possible, Lessee shall cause its Lessee Owned Alterations and Utility Installations, Trade Fixtures, furnishings, equipment and all other personal property to be assessed and billed separately from the real property of Lessor. If any of Lessee's said property shall be assessed with Lessor's real property, Lessee shall pay Lessor the taxes attributable to Lessee's property within 10 days after receipt of a written statement setting forth the taxes applicable to Lessee's property. 11.Utilities and Services.Lessee shall pay for all water, gas, heat, light, power, telephone, trash disposal and other utilities and services supplied to the Premises, together with any taxes thereon. If any such services are not separately metered or billed to Lessee, Lessee shall pay a reasonable proportion, to be determined by Lessor, of all charges jointly metered or billed. There shall be no abatement of rent and Lessor shall not be liable in any respect whatsoever for the inadequacy, stoppage, interruption or discontinuance of any utility or service due to riot, strike, labor dispute, breakdown, accident, repair or other cause beyond Lessor's reasonable control or in cooperation with governmental request or directions. Within fifteen days of Lessor's written request, Lessee agrees to deliver to Lessor such information, documents and/or authorization as Lessor needs in order for Lessor to comply with new or existing Applicable Requirements relating to commercial building energy usage, ratings, and/or the reporting thereof. 12.Assignment and Subletting. 12.1 Lessor's Consent Required. (a) Lessee shall not voluntarily or by operation of law assign, transfer, mortgage or encumber (collectively,"assign or assignment") or sublet all or any part of Lessee's interest in this Lease or in the Premises without Lessor's prior written consent. (b) Unless Lessee is a corporation and its stock is publicly traded on a national stock exchange, a change in the control of Lessee shall constitute an assignment requiring consent. The transfer, on a cumulative basis, of 25% or more of the voting control of Lessee shall constitute a change in control for this purpose. (c) The involvement of Lessee or its assets in any transaction, or series of transactions (by way of merger, sale, acquisition, financing, transfer, leveraged buy-out or otherwise), whether or not a formal assignment or hypothecation of this Lease or Lessee's assets occurs, which results or will result in a reduction of the Net Worth of Lessee by an amount greater than 25% of such Net Worth as it was represented at the time of the execution of this Lease or at the time of the most recent assignment to which Lessor has consented, or as it exists immediately prior to said transaction or transactions constituting such reduction, whichever was or is greater, shall be considered an assignment of this Lease to which Lessor may withhold its consent."Net Worth of Lessee"shall mean the net worth of Lessee (excluding any guarantors) established under generally accepted accounting principles. (d) An assignment or subletting without consent shall, at Lessor's option, be a Default curable after notice per Paragraph 13.1(d), or a noncurable Breach without the necessity of any notice and grace period. If Lessor elects to treat such unapproved assignment or subletting as a noncurable Breach, Lessor may either: (i) terminate this Lease, or (ii) upon 30 days written notice, increase the monthly Base Rent to 110% of the Base Rent then in effect. Further, in the event of such Breach and rental adjustment, (i) the purchase price of any option to purchase the Premises held by Lessee shall be subject to similar adjustment to 110% of the price previously in effect, and (ii) all fixed and non-fixed rental adjustments scheduled during the remainder of the Lease term shall be increased to 110% of the scheduled adjusted rent. (e) Lessee's remedy for any breach of Paragraph 12.1 by Lessor shall be limited to compensatory damages and/or injunctive relief. (f) Lessor may reasonably withhold consent to a proposed assignment or subletting if Lessee is in Default at the time consent is requested. PAGE 10 OF 19 INITIALS INITIALS STG-27.40, Revised 11-25-2019© 2019 AIR CRE. All Rights Reserved. Produced with zipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com 351 N Blackstone DocuSign Envelope ID: 7E1D49B4-3F86-4E92-8E6C-0DCCF8AE21D4 (g) Notwithstanding the foregoing, allowing a de minimis portion of the Premises, ie. 20 square feet or less, to be used by a third party vendor in connection with the installation of a vending machine or payphone shall not constitute a subletting. 12.2 Terms and Conditions Applicable to Assignment and Subletting. (a) Regardless of Lessor's consent, no assignment or subletting shall: (i) be effective without the express written assumption by such assignee or sublessee of the obligations of Lessee under this Lease, (ii) release Lessee of any obligations hereunder, or (iii) alter the primary liability of Lessee for the payment of Rent or for the performance of any other obligations to be performed by Lessee. (b) Lessor may accept Rent or performance of Lessee's obligations from any person other than Lessee pending approval or disapproval of an assignment. Neither a delay in the approval or disapproval of such assignment nor the acceptance of Rent or performance shall constitute a waiver or estoppel of Lessor's right to exercise its remedies for Lessee's Default or Breach. (c) Lessor's consent to any assignment or subletting shall not constitute a consent to any subsequent assignment or subletting. (d) In the event of any Default or Breach by Lessee, Lessor may proceed directly against Lessee, any Guarantors or anyone else responsible for the performance of Lessee's obligations under this Lease, including any assignee or sublessee, without first exhausting Lessor's remedies against any other person or entity responsible therefor to Lessor, or any security held by Lessor. (e) Each request for consent to an assignment or subletting shall be in writing, accompanied by information relevant to Lessor's determination as to the financial and operational responsibility and appropriateness of the proposed assignee or sublessee, including but not limited to the intended use and/or required modification of the Premises, if any, together with a fee of $500 as consideration for Lessor's considering and processing said request. Lessee agrees to provide Lessor with such other or additional information and/or documentation as may be reasonably requested. (See also Paragraph 36) (f) Any assignee of, or sublessee under, this Lease shall, by reason of accepting such assignment, entering into such sublease, or entering into possession of the Premises or any portion thereof, be deemed to have assumed and agreed to conform and comply with each and every term, covenant, condition and obligation herein to be observed or performed by Lessee during the term of said assignment or sublease, other than such obligations as are contrary to or inconsistent with provisions of an assignment or sublease to which Lessor has specifically consented to in writing. (g) Lessor's consent to any assignment or subletting shall not transfer to the assignee or sublessee any Option granted to the original Lessee by this Lease unless such transfer is specifically consented to by Lessor in writing. (See Paragraph 39.2) 12.3 Additional Terms and Conditions Applicable to Subletting.The following terms and conditions shall apply to any subletting by Lessee of all or any part of the Premises and shall be deemed included in all subleases under this Lease whether or not expressly incorporated therein: (a) Lessee hereby assigns and transfers to Lessor all of Lessee's interest in all Rent payable on any sublease, and Lessor may collect such Rent and apply same toward Lessee's obligations under this Lease; provided, however, that until a Breach shall occur in the performance of Lessee's obligations, Lessee may collect said Rent. In the event that the amount collected by Lessor exceeds Lessee's then outstanding obligations any such excess shall be refunded to Lessee. Lessor shall not, by reason of the foregoing or any assignment of such sublease, nor by reason of the collection of Rent, be deemed liable to the sublessee for any failure of Lessee to perform and comply with any of Lessee's obligations to such sublessee. Lessee hereby irrevocably authorizes and directs any such sublessee, upon receipt of a written notice from Lessor stating that a Breach exists in the performance of Lessee's obligations under this Lease, to pay to Lessor all Rent due and to become due under the sublease. Sublessee shall rely upon any such notice from Lessor and shall pay all Rents to Lessor without any obligation or right to inquire as to whether such Breach exists, notwithstanding any claim from Lessee to the contrary. (b) In the event of a Breach by Lessee, Lessor may, at its option, require sublessee to attorn to Lessor, in which event Lessor shall undertake the obligations of the sublessor under such sublease from the time of the exercise of said option to the expiration of such sublease; provided, however, Lessor shall not be liable for any prepaid rents or security deposit paid by such sublessee to such sublessor or for any prior Defaults or Breaches of such sublessor. (c) Any matter requiring the consent of the sublessor under a sublease shall also require the consent of Lessor. (d) No sublessee shall further assign or sublet all or any part of the Premises without Lessor's prior written consent. (e) Lessor shall deliver a copy of any notice of Default or Breach by Lessee to the sublessee, who shall have the right to cure the Default of Lessee within the grace period, if any, specified in such notice. The sublessee shall have a right of reimbursement and offset from and against Lessee for any such Defaults cured by the sublessee. 13.Default; Breach; Remedies. 13.1 Default; Breach.A "Default"is defined as a failure by the Lessee to comply with or perform any of the terms, covenants, conditions or Rules and Regulations under this Lease. A "Breach"is defined as the occurrence of one or more of the following Defaults, and the failure of Lessee to cure such Default within any applicable grace period: (a) The abandonment of the Premises; or the vacating of the Premises without providing a commercially reasonable level of security, or where the coverage of the property insurance described in Paragraph 8.3 is jeopardized as a result thereof, or without providing reasonable assurances to minimize potential vandalism. (b) The failure of Lessee to make any payment of Rent or any Security Deposit required to be made by Lessee hereunder, whether to Lessor or to a third party, when due, to provide reasonable evidence of insurance or surety bond, or to fulfill any obligation under this Lease which endangers or threatens life or property, where such failure continues for a period of 3 business days following written notice to Lessee. THE ACCEPTANCE BY LESSOR OF A PARTIAL PAYMENT OF RENT OR SECURITY DEPOSIT SHALL NOT CONSTITUTE A WAIVER OF ANY OF LESSOR'S RIGHTS, INCLUDING LESSOR'S RIGHT TO RECOVER POSSESSION OF THE PREMISES. (c) The failure of Lessee to allow Lessor and/or its agents access to the Premises or the commission of waste, act or acts constituting public or private nuisance, and/or an illegal activity on the Premises by Lessee, where such actions continue for a period of 3 business days following written notice to Lessee. In the event that Lessee commits waste, a nuisance or an illegal activity a second time then, the Lessor may elect to treat such conduct as a non-curable Breach rather than a Default. (d) The failure by Lessee to provide (i) reasonable written evidence of compliance with Applicable Requirements, (ii) the service contracts, (iii) the rescission of an unauthorized assignment or subletting, (iv) an Estoppel Certificate or financial statements, (v) a requested PAGE 11 OF 19 INITIALS INITIALS STG-27.40, Revised 11-25-2019© 2019 AIR CRE. All Rights Reserved. Produced with zipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com 351 N Blackstone DocuSign Envelope ID: 7E1D49B4-3F86-4E92-8E6C-0DCCF8AE21D4 subordination, (vi) evidence concerning any guaranty and/or Guarantor, (vii) any document requested under Paragraph 42, (viii) material safety data sheets (MSDS), or (ix) any other documentation or information which Lessor may reasonably require of Lessee under the terms of this Lease, where any such failure continues for a period of 10 days following written notice to Lessee. (e) A Default by Lessee as to the terms, covenants, conditions or provisions of this Lease, or of the rules adopted under Paragraph 40 hereof, other than those described in subparagraphs 13.1(a), (b), (c) or (d), above, where such Default continues for a period of 30 days after written notice; provided, however, that if the nature of Lessee's Default is such that more than 30 days are reasonably required for its cure, then it shall not be deemed to be a Breach if Lessee commences such cure within said 30 day period and thereafter diligently prosecutes such cure to completion. (f) The occurrence of any of the following events: (i) the making of any general arrangement or assignment for the benefit of creditors; (ii) becoming a "debtor"as defined in 11 U.S.C. §101 or any successor statute thereto (unless, in the case of a petition filed against Lessee, the same is dismissed within 60 days); (iii) the appointment of a trustee or receiver to take possession of substantially all of Lessee's assets located at the Premises or of Lessee's interest in this Lease, where possession is not restored to Lessee within 30 days; or (iv) the attachment, execution or other judicial seizure of substantially all of Lessee's assets located at the Premises or of Lessee's interest in this Lease, where such seizure is not discharged within 30 days; provided, however, in the event that any provision of this subparagraph (e) is contrary to any applicable law, such provision shall be of no force or effect, and not affect the validity of the remaining provisions. (g) The discovery that any financial statement of Lessee or of any Guarantor given to Lessor was materially false. (h) If the performance of Lessee's obligations under this Lease is guaranteed: (i) the death of a Guarantor, (ii) the termination of a Guarantor's liability with respect to this Lease other than in accordance with the terms of such guaranty, (iii) a Guarantor's becoming insolvent or the subject of a bankruptcy filing, (iv) a Guarantor's refusal to honor the guaranty, or (v) a Guarantor's breach of its guaranty obligation on an anticipatory basis, and Lessee's failure, within 60 days following written notice of any such event, to provide written alternative assurance or security, which, when coupled with the then existing resources of Lessee, equals or exceeds the combined financial resources of Lessee and the Guarantors that existed at the time of execution of this Lease. 13.2 Remedies.If Lessee fails to perform any of its affirmative duties or obligations, within 10 days after written notice (or in case of an emergency, without notice), Lessor may, at its option, perform such duty or obligation on Lessee's behalf, including but not limited to the obtaining of reasonably required bonds, insurance policies, or governmental licenses, permits or approvals. Lessee shall pay to Lessor an amount equal to 115% of the costs and expenses incurred by Lessor in such performance upon receipt of an invoice therefor. In the event of a Breach, Lessor may, with or without further notice or demand, and without limiting Lessor in the exercise of any right or remedy which Lessor may have by reason of such Breach: (a) Terminate Lessee's right to possession of the Premises by any lawful means, in which case this Lease shall terminate and Lessee shall immediately surrender possession to Lessor. In such event Lessor shall be entitled to recover from Lessee: (i) the unpaid Rent which had been earned at the time of termination; (ii) the worth at the time of award of the amount by which the unpaid rent which would have been earned after termination until the time of award exceeds the amount of such rental loss that the Lessee proves could have been reasonably avoided; (iii) the worth at the time of award of the amount by which the unpaid rent for the balance of the term after the time of award exceeds the amount of such rental loss that the Lessee proves could be reasonably avoided; and (iv) any other amount necessary to compensate Lessor for all the detriment proximately caused by the Lessee's failure to perform its obligations under this Lease or which in the ordinary course of things would be likely to result therefrom, including but not limited to the cost of recovering possession of the Premises, expenses of reletting, including necessary renovation and alteration of the Premises, reasonable attorneys' fees, and that portion of any leasing commission paid by Lessor in connection with this Lease applicable to the unexpired term of this Lease. The worth at the time of award of the amount referred to in provision (iii) of the immediately preceding sentence shall be computed by discounting such amount at the discount rate of the Federal Reserve Bank of the District within which the Premises are located at the time of award plus one percent. Efforts by Lessor to mitigate damages caused by Lessee's Breach of this Lease shall not waive Lessor's right to recover any damages to which Lessor is otherwise entitled. If termination of this Lease is obtained through the provisional remedy of unlawful detainer, Lessor shall have the right to recover in such proceeding any unpaid Rent and damages as are recoverable therein, or Lessor may reserve the right to recover all or any part thereof in a separate suit. If a notice and grace period required under Paragraph 13.1 was not previously given, a notice to pay rent or quit, or to perform or quit given to Lessee under the unlawful detainer statute shall also constitute the notice required by Paragraph 13.1. In such case, the applicable grace period required by Paragraph 13.1 and the unlawful detainer statute shall run concurrently, and the failure of Lessee to cure the Default within the greater of the two such grace periods shall constitute both an unlawful detainer and a Breach of this Lease entitling Lessor to the remedies provided for in this Lease and/or by said statute. (b) Continue the Lease and Lessee's right to possession and recover the Rent as it becomes due, in which event Lessee may sublet or assign, subject only to reasonable limitations. Acts of maintenance, efforts to relet, and/or the appointment of a receiver to protect the Lessor's interests, shall not constitute a termination of the Lessee's right to possession. (c) Pursue any other remedy now or hereafter available under the laws or judicial decisions of the state wherein the Premises are located. The expiration or termination of this Lease and/or the termination of Lessee's right to possession shall not relieve Lessee from liability under any indemnity provisions of this Lease as to matters occurring or accruing during the term hereof or by reason of Lessee's occupancy of the Premises. 13.3 Inducement Recapture.Any agreement for free or abated rent or other charges, the cost of tenant improvement for lessee paid for or performed by Lessor, or for the giving or paying by Lessor to or for Lessee of any cash or other bonus, inducement or consideration for Lessee's entering into this Lease, all of which concessions are hereinafter referred to as "Inducement Provisions,"shall be deemed conditioned upon Lessee's full and faithful performance of all of the terms, covenants and conditions of this Lease. Upon Breach of this Lease by Lessee, any such Inducement Provision shall automatically be deemed deleted from this Lease and of no further force or effect, and any rent, other charge, bonus, inducement or consideration theretofore abated, given or paid by Lessor under such an inducement Provision shall be immediately due and payable by Lessee to Lessor, notwithstanding any subsequent cure of said Breach by Lessee. The acceptance by Lessor of rent or the cure of the Breach which initiated the operation of this paragraph shall not be deemed a waiver by Lessor of the provisions of this paragraph unless specifically so stated in writing by Lessor at the time of such acceptance. PAGE 12 OF 19 INITIALS INITIALS STG-27.40, Revised 11-25-2019© 2019 AIR CRE. All Rights Reserved. Produced with zipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com 351 N Blackstone DocuSign Envelope ID: 7E1D49B4-3F86-4E92-8E6C-0DCCF8AE21D4 13.4 Late Charges.Lessee hereby acknowledges that late payment by Lessee of Rent will cause Lessor to incur costs not contemplated by this Lease, the exact amount of which will be extremely difficult to ascertain. Such costs include, but are not limited to, processing and accounting charges, and late charges which may be imposed upon Lessor by any Lender. Accordingly, if any Rent shall not be received by Lessor within 5 days after such amount shall be due, then, without any requirement for notice to Lessee, Lessee shall immediately pay to Lessor a one-time late charge equal to 10% of each such overdue amount or $100, whichever is greater. The Parties hereby agree that such late charge represents a fair and reasonable estimate of the costs Lessor will incur by reason of such late payment. Acceptance of such late charge by Lessor shall in no event constitute a waiver of Lessee's Default or Breach with respect to such overdue amount, nor prevent the exercise of any of the other rights and remedies granted hereunder. In the event that a late charge is payable hereunder, whether or not collected, for 3 consecutive installments of Base Rent, then notwithstanding any provision of this Lease to the contrary, Base Rent shall, at Lessor's option, become due and payable quarterly in advance. 13.5 Interest.Any monetary payment due Lessor hereunder, other than late charges, not received by Lessor, when due shall bear interest from the 31st day after it was due. The interest ("Interest") charged shall be computed at the rate of 10% per annum but shall not exceed the maximum rate allowed by law. Interest is payable in addition to the potential late charge provided for in Paragraph 13.4. 13.6 Breach by Lessor. (a)Notice of Breach.Lessor shall not be deemed in breach of this Lease unless Lessor fails within a reasonable time to perform an obligation required to be performed by Lessor. For purposes of this Paragraph, a reasonable time shall in no event be less than 30 days after receipt by Lessor, and any Lender whose name and address shall have been furnished Lessee in writing for such purpose, of written notice specifying wherein such obligation of Lessor has not been performed; provided, however, that if the nature of Lessor's obligation is such that more than 30 days are reasonably required for its performance, then Lessor shall not be in breach if performance is commenced within such 30 day period and thereafter diligently pursued to completion. (b)Performance by Lessee on Behalf of Lessor.In the event that neither Lessor nor Lender cures said breach within 30 days after receipt of said notice, or if having commenced said cure they do not diligently pursue it to completion, then Lessee may elect to cure said breach at Lessee's expense and offset from Rent the actual and reasonable cost to perform such cure, provided however, that such offset shall not exceed an amount equal to the greater of one month's Base Rent or the Security Deposit, reserving Lessee's right to seek reimbursement from Lessor for any such expense in excess of such offset. Lessee shall document the cost of said cure and supply said documentation to Lessor. 14.Condemnation.If the Premises or any portion thereof are taken under the power of eminent domain or sold under the threat of the exercise of said power (collectively "Condemnation"), this Lease shall terminate as to the part taken as of the date the condemning authority takes title or possession, whichever first occurs. If more than 10% of the Building, or more than 25% of that portion of the Premises not occupied by any building, is taken by Condemnation, Lessee may, at Lessee's option, to be exercised in writing within 10 days after Lessor shall have given Lessee written notice of such taking (or in the absence of such notice, within 10 days after the condemning authority shall have taken possession) terminate this Lease as of the date the condemning authority takes such possession. If Lessee does not terminate this Lease in accordance with the foregoing, this Lease shall remain in full force and effect as to the portion of the Premises remaining, except that the Base Rent shall be reduced in proportion to the reduction in utility of the Premises caused by such Condemnation. Condemnation awards and/or payments shall be the property of Lessor, whether such award shall be made as compensation for diminution in value of the leasehold, the value of the part taken, or for severance damages; provided, however, that Lessee shall be entitled to any compensation paid by the condemnor for Lessee's relocation expenses, loss of business goodwill and/or Trade Fixtures, without regard to whether or not this Lease is terminated pursuant to the provisions of this Paragraph. All Alterations and Utility Installations made to the Premises by Lessee, for purposes of Condemnation only, shall be considered the property of the Lessee and Lessee shall be entitled to any and all compensation which is payable therefor. In the event that this Lease is not terminated by reason of the Condemnation, Lessor shall repair any damage to the Premises caused by such Condemnation. 15.Brokerage Fees. 15.1 Additional Commission.In addition to the payments owed pursuant to Paragraph 1.9 above, Lessor agrees that: (a) if Lessee exercises any Option, (b) if Lessee or anyone affiliated with Lessee acquires any rights to the Premises or other premises owned by Lessor and located within the same Project, if any, within which the Premises is located, (c) if Lessee remains in possession of the Premises, with the consent of Lessor, after the expiration of this Lease, or (d) if Base Rent is increased, whether by agreement or operation of an escalation clause herein, then, Lessor shall pay Brokers a fee in accordance with the fee schedule of the Brokers in effect at the time the Lease was executed. The provisions of this paragraph are intended to supersede the provisions of any earlier agreement to the contrary. 15.2 Assumption of Obligations.Any buyer or transferee of Lessor's interest in this Lease shall be deemed to have assumed Lessor's obligation hereunder. Brokers shall be third party beneficiaries of the provisions of Paragraphs 1.9, 15, 22 and 31. If Lessor fails to pay to Brokers any amounts due as and for brokerage fees pertaining to this Lease when due, then such amounts shall accrue Interest. In addition, if Lessor fails to pay any amounts to Lessee's Broker when due, Lessee's Broker may send written notice to Lessor and Lessee of such failure and if Lessor fails to pay such amounts within 10 days after said notice, Lessee shall pay said monies to its Broker and offset such amounts against Rent. In addition, Lessee's Broker shall be deemed to be a third party beneficiary of any commission agreement entered into by and/or between Lessor and Lessor's Broker for the limited purpose of collecting any brokerage fee owed. 15.3 Representations and Indemnities of Broker Relationships.Lessee and Lessor each represent and warrant to the other that it has had no dealings with any person, firm, broker, agent or finder (other than the Brokers and Agents, if any) in connection with this Lease, and that no one other than said named Brokers and Agents is entitled to any commission or finder's fee in connection herewith. Lessee and Lessor do each hereby agree to indemnify, protect, defend and hold the other harmless from and against liability for compensation or charges which may be claimed by any such unnamed broker, finder or other similar party by reason of any dealings or actions of the indemnifying Party, including any costs, expenses, attorneys' fees reasonably incurred with respect thereto. PAGE 13 OF 19 INITIALS INITIALS STG-27.40, Revised 11-25-2019© 2019 AIR CRE. All Rights Reserved. Produced with zipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com 351 N Blackstone DocuSign Envelope ID: 7E1D49B4-3F86-4E92-8E6C-0DCCF8AE21D4 16.Estoppel Certificates. (a) Each Party (as "Responding Party") shall within 10 days after written notice from the other Party (the "Requesting Party") execute, acknowledge and deliver to the Requesting Party a statement in writing in form similar to the then most current "Estoppel Certificate"form published by the AIR Commercial Real Estate Association, plus such additional information, confirmation and/or statements as may be reasonably requested by the Requesting Party. (b) If the Responding Party shall fail to execute or deliver the Estoppel Certificate within such 10 day period, the Requesting Party may execute an Estoppel Certificate stating that: (i) the Lease is in full force and effect without modification except as may be represented by the Requesting Party, (ii) there are no uncured defaults in the Requesting Party's performance, and (iii) if Lessor is the Requesting Party, not more than one month's rent has been paid in advance. Prospective purchasers and encumbrancers may rely upon the Requesting Party's Estoppel Certificate, and the Responding Party shall be estopped from denying the truth of the facts contained in said Certificate. In addition, Lessee acknowledges that any failure on its part to provide such an Estoppel Certificate will expose Lessor to risks and potentially cause Lessor to incur costs not contemplated by this Lease, the extent of which will be extremely difficult to ascertain. Accordingly, should the Lessee fail to execute and/or deliver a requested Estoppel Certificate in a timely fashion the monthly Base Rent shall be automatically increased, without any requirement for notice to Lessee, by an amount equal to 10% of the then existing Base Rent or $100, whichever is greater for remainder of the Lease. The Parties agree that such increase in Base Rent represents fair and reasonable compensation for the additional risk/costs that Lessor will incur by reason of Lessee's failure to provide the Estoppel Certificate. Such increase in Base Rent shall in no event constitute a waiver of Lessee's Default or Breach with respect to the failure to provide the Estoppel Certificate nor prevent the exercise of any of the other rights and remedies granted hereunder. (c) If Lessor desires to finance, refinance, or sell the Premises, or any part thereof, Lessee and all Guarantors shall within 10 days after written notice from Lessor deliver to any potential lender or purchaser designated by Lessor such financial statements as may be reasonably required by such lender or purchaser, including but not limited to Lessee's financial statements for the past 3 years. All such financial statements shall be received by Lessor and such lender or purchaser in confidence and shall be used only for the purposes herein set forth. 17.Definition of Lessor.The term "Lessor"as used herein shall mean the owner or owners at the time in question of the fee title to the Premises, or, if this is a sublease, of the Lessee's interest in the prior lease. In the event of a transfer of Lessor's title or interest in the Premises or this Lease, Lessor shall deliver to the transferee or assignee (in cash or by credit) any unused Security Deposit held by Lessor. Upon such transfer or assignment and delivery of the Security Deposit, as aforesaid, the prior Lessor shall be relieved of all liability with respect to the obligations and/or covenants under this Lease thereafter to be performed by the Lessor. Subject to the foregoing, the obligations and/or covenants in this Lease to be performed by the Lessor shall be binding only upon the Lessor as hereinabove defined. 18.Severability.The invalidity of any provision of this Lease, as determined by a court of competent jurisdiction, shall in no way affect the validity of any other provision hereof. 19.Days.Unless otherwise specifically indicated to the contrary, the word "days" as used in this Lease shall mean and refer to calendar days. 20.Limitation on Liability.The obligations of Lessor under this Lease shall not constitute personal obligations of Lessor or its partners, members, directors, officers or shareholders, and Lessee shall look to the Premises, and to no other assets of Lessor, for the satisfaction of any liability of Lessor with respect to this Lease, and shall not seek recourse against Lessor's partners, members, directors, officers or shareholders, or any of their personal assets for such satisfaction. 21.Time of Essence.Time is of the essence with respect to the performance of all obligations to be performed or observed by the Parties under this Lease. 22.No Prior or Other Agreements; Broker Disclaimer.This Lease contains all agreements between the Parties with respect to any matter mentioned herein, and no other prior or contemporaneous agreement or understanding shall be effective. Lessor and Lessee each represents and warrants to the Brokers that it has made, and is relying solely upon, its own investigation as to the nature, quality, character and financial responsibility of the other Party to this Lease and as to the use, nature, quality and character of the Premises. Brokers have no responsibility with respect thereto or with respect to any default or breach hereof by either Party. 23.Notices. 23.1 Notice Requirements.All notices required or permitted by this Lease or applicable law shall be in writing and may be delivered in person (by hand or by courier) or may be sent by regular, certified or registered mail or U.S. Postal Service Express Mail, with postage prepaid, or by facsimile transmission, and shall be deemed sufficiently given if served in a manner specified in this Paragraph 23. The addresses noted adjacent to a Party's signature on this Lease shall be that Party's address for delivery or mailing of notices. Either Party may by written notice to the other specify a different address for notice, except that upon Lessee's taking possession of the Premises, the Premises shall constitute Lessee's address for notice. A copy of all notices to Lessor shall be concurrently transmitted to such party or parties at such addresses as Lessor may from time to time hereafter designate in writing. 23.2 Date of Notice.Any notice sent by registered or certified mail, return receipt requested, shall be deemed given on the date of delivery shown on the receipt card, or if no delivery date is shown, the postmark thereon. If sent by regular mail the notice shall be deemed given 72 hours after the same is addressed as required herein and mailed with postage prepaid. Notices delivered by United States Express Mail or overnight courier that guarantees next day delivery shall be deemed given 24 hours after delivery of the same to the Postal Service or courier. Notices delivered by hand, or transmitted by facsimile transmission or by email shall be deemed delivered upon actual receipt. If notice is received on a Saturday, Sunday or legal holiday, it shall be deemed received on the next business day. 24.Waivers. (a) No waiver by Lessor of the Default or Breach of any term, covenant or condition hereof by Lessee, shall be deemed a waiver of any other term, covenant or condition hereof, or of any subsequent Default or Breach by Lessee of the same or of any other term, covenant or condition hereof. Lessor's consent to, or approval of, any act shall not be deemed to render unnecessary the obtaining of Lessor's consent to, or approval of, any subsequent or similar act by Lessee, or be construed as the basis of an estoppel to enforce the provision or provisions of this Lease requiring such consent. PAGE 14 OF 19 INITIALS INITIALS STG-27.40, Revised 11-25-2019© 2019 AIR CRE. All Rights Reserved. Produced with zipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com 351 N Blackstone DocuSign Envelope ID: 7E1D49B4-3F86-4E92-8E6C-0DCCF8AE21D4 (b) The acceptance of Rent by Lessor shall not be a waiver of any Default or Breach by Lessee. Any payment by Lessee may be accepted by Lessor on account of moneys or damages due Lessor, notwithstanding any qualifying statements or conditions made by Lessee in connection therewith, which such statements and/or conditions shall be of no force or effect whatsoever unless specifically agreed to in writing by Lessor at or before the time of deposit of such payment. (c) THE PARTIES AGREE THAT THE TERMS OF THIS LEASE SHALL GOVERN WITH REGARD TO ALL MATTERS RELATED THERETO AND HEREBY WAIVE THE PROVISIONS OF ANY PRESENT OR FUTURE STATUTE TO THE EXTENT THAT SUCH STATUTE IS INCONSISTENT WITH THIS LEASE. 25.Disclosures Regarding The Nature of a Real Estate Agency Relationship. (a) When entering into a discussion with a real estate agent regarding a real estate transaction, a Lessor or Lessee should from the outset understand what type of agency relationship or representation it has with the agent or agents in the transaction. Lessor and Lessee acknowledge being advised by the Brokers in this transaction, as follows: (i)Lessor's Agent. A Lessor's agent under a listing agreement with the Lessor acts as the agent for the Lessor only. A Lessor's agent or subagent has the following affirmative obligations:To the Lessor: A fiduciary duty of utmost care, integrity, honesty, and loyalty in dealings with the Lessor.To the Lessee and the Lessor: a. Diligent exercise of reasonable skills and care in performance of the agent's duties. b. A duty of honest and fair dealing and good faith. c. A duty to disclose all facts known to the agent materially affecting the value or desirability of the property that are not known to, or within the diligent attention and observation of, the Parties. An agent is not obligated to reveal to either Party any confidential information obtained from the other Party which does not involve the affirmative duties set forth above. (ii)Lessee's Agent. An agent can agree to act as agent for the Lessee only. In these situations, the agent is not the Lessor's agent, even if by agreement the agent may receive compensation for services rendered, either in full or in part from the Lessor. An agent acting only for a Lessee has the following affirmative obligations.To the Lessee: A fiduciary duty of utmost care, integrity, honesty, and loyalty in dealings with the Lessee.To the Lessee and the Lessor: a. Diligent exercise of reasonable skills and care in performance of the agent's duties. b. A duty of honest and fair dealing and good faith. c. A duty to disclose all facts known to the agent materially affecting the value or desirability of the property that are not known to, or within the diligent attention and observation of, the Parties. An agent is not obligated to reveal to either Party any confidential information obtained from the other Party which does not involve the affirmative duties set forth above. (iii)Agent Representing Both Lessor and Lessee. A real estate agent, either acting directly or through one or more associate licenses, can legally be the agent of both the Lessor and the Lessee in a transaction, but only with the knowledge and consent of both the Lessor and the Lessee. In a dual agency situation, the agent has the following affirmative obligations to both the Lessor and the Lessee: a. A fiduciary duty of utmost care, integrity, honesty and loyalty in the dealings with either Lessor or the Lessee. b. Other duties to the Lessor and the Lessee as stated above in subparagraphs (i) or (ii). In representing both Lessor and Lessee, the agent may not, without the express permission of the respective Party, disclose to the other Party confidential information, including, but not limited to, facts relating to either Lessee's or Lessor's financial position, motivations, bargaining position, or other personal information that may impact rent, including Lessor's willingness to accept a rent less than the listing rent or Lessee's willingness to pay rent greater than the rent offered. The above duties of the agent in a real estate transaction do not relieve a Lessor or Lessee from the responsibility to protect their own interests. Lessor and Lessee should carefully read all agreements to assure that they adequately express their understanding of the transaction. A real estate agent is a person qualified to advise about real estate. If legal or tax advice is desired, consult a competent professional. Both Lessor and Lessee should strongly consider obtaining tax advice from a competent professional because the federal and state tax consequences of a transaction can be complex and subject to change. (b) Brokers have no responsibility with respect to any default or breach hereof by either Party. The Parties agree that no lawsuit or other legal proceeding involving any breach of duty, error or omission relating to this Lease may be brought against Broker more than one year after the Start Date and that the liability (including court costs and attorneys' fees), of any Broker with respect to any such lawsuit and/or legal proceeding shall not exceed the fee received by such Broker pursuant to this Lease; provided, however, that the foregoing limitation on each Broker's liability shall not be applicable to any gross negligence or willful misconduct of such Broker. (c) Lessor and Lessee agree to identify to Brokers as "Confidential" any communication or information given Brokers that is considered by such Party to be confidential. 26.No Right To Holdover.Lessee has no right to retain possession of the Premises or any part thereof beyond the expiration or termination of this Lease. In the event that Lessee holds over, then the Base Rent shall be increased to 150% of the Base Rent applicable immediately preceding the expiration or termination. Nothing contained herein shall be construed as consent by Lessor to any holding over by Lessee. 27.Cumulative Remedies.No remedy or election hereunder shall be deemed exclusive but shall, wherever possible, be cumulative with all other remedies at law or in equity. 28.Covenants and Conditions; Construction of Agreement.All provisions of this Lease to be observed or performed by Lessee are both covenants and conditions. In construing this Lease, all headings and titles are for the convenience of the Parties only and shall not be considered a part of this Lease. Whenever required by the context, the singular shall include the plural and vice versa. This Lease shall not be construed as if prepared by one of the Parties, but rather according to its fair meaning as a whole, as if both Parties had prepared it. 29.Binding Effect; Choice of Law.This Lease shall be binding upon the Parties, their personal representatives, successors and assigns and be governed by the laws of the State in which the Premises are located. Any litigation between the Parties hereto concerning this Lease shall be initiated in the county in which the Premises are located. Signatures to this Lease accomplished by means of electronic signature or similar technology shall be legal and binding. 30.Subordination; Attornment; Non-Disturbance. 30.1 Subordination.This Lease and any Option granted hereby shall be subject and subordinate to any ground lease, mortgage, deed of trust, or other hypothecation or security device (collectively,"Security Device"), now or hereafter placed upon the Premises, to any and all advances made on the security thereof, and to all renewals, modifications, and extensions thereof. Lessee agrees that the holders of any such Security Devices (in this Lease together referred to as "Lender") shall have no liability or obligation to perform any of the obligations of Lessor under this Lease. Any Lender may elect to have this Lease and/or any Option granted hereby superior to the lien of its Security Device by giving written notice thereof to Lessee, whereupon this Lease and such Options shall be deemed prior to such Security Device, notwithstanding the relative dates of the documentation or recordation thereof. PAGE 15 OF 19 INITIALS INITIALS STG-27.40, Revised 11-25-2019© 2019 AIR CRE. All Rights Reserved. Produced with zipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com 351 N Blackstone DocuSign Envelope ID: 7E1D49B4-3F86-4E92-8E6C-0DCCF8AE21D4 30.2 Attornment.In the event that Lessor transfers title to the Premises, or the Premises are acquired by another upon the foreclosure or termination of a Security Device to which this Lease is subordinated (i) Lessee shall, subject to the non-disturbance provisions of Paragraph 30.3, attorn to such new owner, and upon request, enter into a new lease, containing all of the terms and provisions of this Lease, with such new owner for the remainder of the term hereof, or, at the election of the new owner, this Lease will automatically become a new lease between Lessee and such new owner, and (ii) Lessor shall thereafter be relieved of any further obligations hereunder and such new owner shall assume all of Lessor's obligations, except that such new owner shall not: (a) be liable for any act or omission of any prior lessor or with respect to events occurring prior to acquisition of ownership; (b) be subject to any offsets or defenses which Lessee might have against any prior lessor, (c) be bound by prepayment of more than one month's rent, or (d) be liable for the return of any security deposit paid to any prior lessor which was not paid or credited to such new owner. 30.3 Non-Disturbance.With respect to Security Devices entered into by Lessor after the execution of this Lease, Lessee's subordination of this Lease shall be subject to receiving a commercially reasonable non-disturbance agreement (a "Non-Disturbance Agreement") from the Lender which Non-Disturbance Agreement provides that Lessee's possession of the Premises, and this Lease, including any options to extend the term hereof, will not be disturbed so long as Lessee is not in Breach hereof and attorns to the record owner of the Premises. Further, within 60 days after the execution of this Lease, Lessor shall, if requested by Lessee, use its commercially reasonable efforts to obtain a Non-Disturbance Agreement from the holder of any pre-existing Security Device which is secured by the Premises. In the event that Lessor is unable to provide the Non-Disturbance Agreement within said 60 days, then Lessee may, at Lessee's option, directly contact Lender and attempt to negotiate for the execution and delivery of a Non-Disturbance Agreement. 30.4 Self-Executing.The agreements contained in this Paragraph 30 shall be effective without the execution of any further documents; provided, however, that, upon written request from Lessor or a Lender in connection with a sale, financing or refinancing of the Premises, Lessee and Lessor shall execute such further writings as may be reasonably required to separately document any subordination, attornment and/or Non-Disturbance Agreement provided for herein. 31.Attorneys' Fees.If any Party or Broker brings an action or proceeding involving the Premises whether founded in tort, contract or equity, or to declare rights hereunder, the Prevailing Party (as hereafter defined) in any such proceeding, action, or appeal thereon, shall be entitled to reasonable attorneys' fees. Such fees may be awarded in the same suit or recovered in a separate suit, whether or not such action or proceeding is pursued to decision or judgment. The term,"Prevailing Party"shall include, without limitation, a Party or Broker who substantially obtains or defeats the relief sought, as the case may be, whether by compromise, settlement, judgment, or the abandonment by the other Party or Broker of its claim or defense. The attorneys' fees award shall not be computed in accordance with any court fee schedule, but shall be such as to fully reimburse all attorneys' fees reasonably incurred. In addition, Lessor shall be entitled to attorneys' fees, costs and expenses incurred in the preparation and service of notices of Default and consultations in connection therewith, whether or not a legal action is subsequently commenced in connection with such Default or resulting Breach ($200 is a reasonable minimum per occurrence for such services and consultation). 32.Lessor's Access; Showing Premises; Repairs.Lessor and Lessor's agents shall have the right to enter the Premises at any time, in the case of an emergency, and otherwise at reasonable times after reasonable prior notice for the purpose of showing the same to prospective purchasers, lenders, or tenants, and making such alterations, repairs, improvements or additions to the Premises as Lessor may deem necessary or desirable and the erecting, using and maintaining of utilities, services, pipes and conduits through the Premises and/or other premises as long as there is no material adverse effect to Lessee's use of the Premises. All such activities shall be without abatement of rent or liability to Lessee. 33.Auctions.Lessee shall not conduct, nor permit to be conducted, any auction upon the Premises without Lessor's prior written consent. Lessor shall not be obligated to exercise any standard of reasonableness in determining whether to permit an auction. 34.Signs.Lessor may place on the Premises ordinary "For Sale" signs at any time and ordinary "For Lease" signs during the last 6 months of the term hereof. Except for ordinary "for sublease" signs, Lessee shall not place any sign upon the Premises without Lessor's prior written consent. All signs must comply with all Applicable Requirements. 35.Termination; Merger.Unless specifically stated otherwise in writing by Lessor, the voluntary or other surrender of this Lease by Lessee, the mutual termination or cancellation hereof, or a termination hereof by Lessor for Breach by Lessee, shall automatically terminate any sublease or lesser estate in the Premises; provided, however, that Lessor may elect to continue any one or all existing subtenancies. Lessor's failure within 10 days following any such event to elect to the contrary by written notice to the holder of any such lesser interest, shall constitute Lessor's election to have such event constitute the termination of such interest. 36.Consents.All requests for consent shall be in writing. Except as otherwise provided herein, wherever in this Lease the consent of a Party is required to an act by or for the other Party, such consent shall not be unreasonably withheld or delayed. Lessor's actual reasonable costs and expenses (including but not limited to architects', attorneys', engineers' and other consultants' fees) incurred in the consideration of, or response to, a request by Lessee for any Lessor consent, including but not limited to consents to an assignment, a subletting or the presence or use of a Hazardous Substance, shall be paid by Lessee upon receipt of an invoice and supporting documentation therefor. Lessor's consent to any act, assignment or subletting shall not constitute an acknowledgment that no Default or Breach by Lessee of this Lease exists, nor shall such consent be deemed a waiver of any then existing Default or Breach, except as may be otherwise specifically stated in writing by Lessor at the time of such consent. The failure to specify herein any particular condition to Lessor's consent shall not preclude the imposition by Lessor at the time of consent of such further or other conditions as are then reasonable with reference to the particular matter for which consent is being given. In the event that either Party disagrees with any determination made by the other hereunder and reasonably requests the reasons for such determination, the determining party shall furnish its reasons in writing and in reasonable detail within 10 business days following such request. 37.Guarantor. 37.1 Execution.The Guarantors, if any, shall each execute a guaranty in the form most recently published by the AIR Commercial Real Estate Association. 37.2 Default.It shall constitute a Default of the Lessee if any Guarantor fails or refuses, upon request to provide: (a) evidence of the execution of the guaranty, including the authority of the party signing on Guarantor's behalf to obligate Guarantor, and in the case of a corporate Guarantor, a certified copy of a resolution of its board of directors authorizing the making of such guaranty, (b) current financial statements, (c) an Estoppel Certificate, or (d) written confirmation that the guaranty is still in effect. PAGE 16 OF 19 INITIALS INITIALS STG-27.40, Revised 11-25-2019© 2019 AIR CRE. All Rights Reserved. Produced with zipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com 351 N Blackstone DocuSign Envelope ID: 7E1D49B4-3F86-4E92-8E6C-0DCCF8AE21D4 38.Quiet Possession.Subject to payment by Lessee of the Rent and performance of all of the covenants, conditions and provisions on Lessee's part to be observed and performed under this Lease, Lessee shall have quiet possession and quiet enjoyment of the Premises during the term hereof. 39.Options.If Lessee is granted an Option, as defined below, then the following provisions shall apply: 39.1 Definition. "Option"shall mean: (a) the right to extend or reduce the term of or renew this Lease or to extend or reduce the term of or renew any lease that Lessee has on other property of Lessor; (b) the right of first refusal or first offer to lease either the Premises or other property of Lessor; (c) the right to purchase, the right of first offer to purchase or the right of first refusal to purchase the Premises or other property of Lessor. 39.2 Options Personal To Original Lessee.Any Option granted to Lessee in this Lease is personal to the original Lessee, and cannot be assigned or exercised by anyone other than said original Lessee and only while the original Lessee is in full possession of the Premises and, if requested by Lessor, with Lessee certifying that Lessee has no intention of thereafter assigning or subletting. 39.3 Multiple Options.In the event that Lessee has any multiple Options to extend or renew this Lease, a later Option cannot be exercised unless the prior Options have been validly exercised. 39.4 Effect of Default on Options. (a) Lessee shall have no right to exercise an Option: (i) during the period commencing with the giving of any notice of Default and continuing until said Default is cured, (ii) during the period of time any Rent is unpaid (without regard to whether notice thereof is given Lessee), (iii) during the time Lessee is in Breach of this Lease, or (iv) in the event that Lessee has been given 3 or more notices of separate Default, whether or not the Defaults are cured, during the 12 month period immediately preceding the exercise of the Option. (b) The period of time within which an Option may be exercised shall not be extended or enlarged by reason of Lessee's inability to exercise an Option because of the provisions of Paragraph 39.4(a). (c) An Option shall terminate and be of no further force or effect, notwithstanding Lessee's due and timely exercise of the Option, if, after such exercise and prior to the commencement of the extended term or completion of the purchase, (i) Lessee fails to pay Rent for a period of 30 days after such Rent becomes due (without any necessity of Lessor to give notice thereof), or (ii) if Lessee commits a Breach of this Lease. 40.Multiple Buildings.If the Premises are a part of a group of buildings controlled by Lessor, Lessee agrees that it will abide by and conform to all reasonable rules and regulations which Lessor may make from time to time for the management, safety, and care of said properties, including the care and cleanliness of the grounds and including the parking, loading and unloading of vehicles, and to cause its employees, suppliers, shippers, customers, contractors and invitees to so abide and conform. Lessee also agrees to pay its fair share of common expenses incurred in connection with such rules and regulations. 41.Security Measures.Lessee hereby acknowledges that the Rent payable to Lessor hereunder does not include the cost of guard service or other security measures, and that Lessor shall have no obligation whatsoever to provide same. Lessee assumes all responsibility for the protection of the Premises, Lessee, its agents and invitees and their property from the acts of third parties. 42.Reservations.Lessor reserves to itself the right, from time to time, to grant, without the consent or joinder of Lessee, such easements, rights and dedications that Lessor deems necessary, and to cause the recordation of parcel maps and restrictions, so long as such easements, rights, dedications, maps and restrictions do not unreasonably interfere with the use of the Premises by Lessee. Lessee agrees to sign any documents reasonably requested by Lessor to effectuate any such easement rights, dedication, map or restrictions. 43.Performance Under Protest.If at any time a dispute shall arise as to any amount or sum of money to be paid by one Party to the other under the provisions hereof, the Party against whom the obligation to pay the money is asserted shall have the right to make payment "under protest" and such payment shall not be regarded as a voluntary payment and there shall survive the right on the part of said Party to institute suit for recovery of such sum. If it shall be adjudged that there was no legal obligation on the part of said Party to pay such sum or any part thereof, said Party shall be entitled to recover such sum or so much thereof as it was not legally required to pay. A Party who does not initiate suit for the recovery of sums paid "under protest" within 6 months shall be deemed to have waived its right to protest such payment. 44.Authority; Multiple Parties; Execution. (a) If either Party hereto is a corporation, trust, limited liability company, partnership, or similar entity, each individual executing this Lease on behalf of such entity represents and warrants that he or she is duly authorized to execute and deliver this Lease on its behalf. Each Party shall, within 30 days after request, deliver to the other Party satisfactory evidence of such authority. (b) If this Lease is executed by more than one person or entity as "Lessee", each such person or entity shall be jointly and severally liable hereunder. It is agreed that any one of the named Lessees shall be empowered to execute any amendment to this Lease, or other document ancillary thereto and bind all of the named Lessees, and Lessor may rely on the same as if all of the named Lessees had executed such document. (c) This Lease may be executed by the Parties in counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same instrument. 45.Conflict.Any conflict between the printed provisions of this Lease and typewritten or handwritten provisions shall be controlled by the typewritten or handwritten provisions. 46.Offer.Preparation of this Lease by either Party or their agent and submission of same to the other Party shall not be deemed an offer to lease to the other Party. This Lease is not intended to be binding until executed and delivered by all Parties hereto. 47.Amendments.This Lease may be modified only in writing, signed by the Parties in interest at the time of the modification. As long as they do not materially change Lessee's obligations hereunder, Lessee agrees to make such reasonable non-monetary modifications to this Lease as may be reasonably required by a Lender in connection with the obtaining of normal financing or refinancing of the Premises. 48.Waiver of Jury Trial. THE PARTIES HEREBY WAIVE THEIR RESPECTIVE RIGHTS TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING INVOLVING THE PROPERTY OR ARISING OUT OF THIS AGREEMENT. 49.Arbitration of Disputes.An Addendum requiring the Arbitration of disputes between the Parties and/or Brokers arising out of this Lease is is not attached to this Lease. PAGE 17 OF 19 INITIALS INITIALS STG-27.40, Revised 11-25-2019© 2019 AIR CRE. All Rights Reserved. Produced with zipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com X 351 N Blackstone DocuSign Envelope ID: 7E1D49B4-3F86-4E92-8E6C-0DCCF8AE21D4 50.Accessibility; Americans with Disabilities Act. (a) The Premises: Have not undergone an inspection by a Certified Access Specialist (CASp). Note: A Certified Access Specialist (CASp) can inspect the subject premises and determine whether the subject premises comply with all of the applicable construction-related accessibility standards under state law. Although state law does not require a CASp inspection of the subject premises, the commercial property owner or lessor may not prohibit the lessee or tenant from obtaining a CASp inspection of the subject premises for the occupancy or potential occupancy of the lessee or tenant, if requested by the lessee or tenant. The parties shall mutually agree on the arrangements for the time and manner of the CASp inspection, the payment of the fee for the CASp inspection, and the cost of making any repairs necessary to correct violations of construction-related accessibility standards within the premises. Have undergone an inspection by a Certified Access Specialist (CASp) and it was determined that the Premises met all applicable construction-related accessibility standards pursuant to California Civil Code §55.51 et seq. Lessee acknowledges that it received a copy of the inspection report at least 48 hours prior to executing this Lease and agrees to keep such report confidential. Have undergone an inspection by a Certified Access Specialist (CASp) and it was determined that the Premises did not meet all applicable construction-related accessibility standards pursuant to California Civil Code §55.51 et seq. Lessee acknowledges that it received a copy of the inspection report at least 48 hours prior to executing this Lease and agrees to keep such report confidential except as necessary to complete repairs and corrections of violations of construction related accessibility standards. In the event that the Premises have been issued an inspection report by a CASp the Lessor shall provide a copy of the disability access inspection certificate to Lessee within 7 days of the execution of this Lease. (b) Since compliance with the Americans with Disabilities Act (ADA) and other state and local accessibility statutes are dependent upon Lessee's specific use of the Premises, Lessor makes no warranty or representation as to whether or not the Premises comply with ADA or any similar legislation. In the event that Lessee's use of the Premises requires modifications or additions to the Premises in order to be in compliance with ADA or other accessibility statutes, Lessee agrees to make any such necessary modifications and/or additions at Lessee's expense. LESSOR AND LESSEE HAVE CAREFULLY READ AND REVIEWED THIS LEASE AND EACH TERM AND PROVISION CONTAINED HEREIN, AND BY THE EXECUTION OF THIS LEASE SHOW THEIR INFORMED AND VOLUNTARY CONSENT THERETO. THE PARTIES HEREBY AGREE THAT, AT THE TIME THIS LEASE IS EXECUTED, THE TERMS OF THIS LEASE ARE COMMERCIALLY REASONABLE AND EFFECTUATE THE INTENT AND PURPOSE OF LESSOR AND LESSEE WITH RESPECT TO THE PREMISES. ATTENTION: NO REPRESENTATION OR RECOMMENDATION IS MADE BY THE AIR CRE OR BY ANY BROKER AS TO THE LEGAL SUFFICIENCY, LEGAL EFFECT, OR TAX CONSEQUENCES OF THIS LEASE OR THE TRANSACTION TO WHICH IT RELATES. THE PARTIES ARE URGED TO: 1. SEEK ADVICE OF COUNSEL AS TO THE LEGAL AND TAX CONSEQUENCES OF THIS LEASE. 2. RETAIN APPROPRIATE CONSULTANTS TO REVIEW AND INVESTIGATE THE CONDITION OF THE PREMISES. SAID INVESTIGATION SHOULD INCLUDE BUT NOT BE LIMITED TO: THE POSSIBLE PRESENCE OF HAZARDOUS SUBSTANCES, THE ZONING OF THE PREMISES, THE STRUCTURAL INTEGRITY, THE CONDITION OF THE ROOF AND OPERATING SYSTEMS, AND THE SUITABILITY OF THE PREMISES FOR LESSEE'S INTENDED USE. WARNING: IF THE PREMISES IS LOCATED IN A STATE OTHER THAN CALIFORNIA, CERTAIN PROVISIONS OF THE LEASE MAY NEED TO BE REVISED TO COMPLY WITH THE LAWS OF THE STATE IN WHICH THE PREMISES IS LOCATED. The parties hereto have executed this Lease at the place and on the dates specified above their respective signatures. Executed at:Executed at: On:On: By LESSOR:By LESSEE: By:By: Name Printed:Name Printed: Title:Title: Phone:Phone: Fax:Fax: Email:Email: By:By: Name Printed:Name Printed: Title:Title: Phone:Phone: Fax:Fax: Email:Email: Address:Address: Federal ID No.:Federal ID No.: PAGE 18 OF 19 INITIALS INITIALS STG-27.40, Revised 11-25-2019© 2019 AIR CRE. All Rights Reserved. Produced with zipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com X Michael A Richards Michael A Richards STACHS, LLC a Delaware limited liability company 351 N Blackstone DocuSign Envelope ID: 7E1D49B4-3F86-4E92-8E6C-0DCCF8AE21D4 Tony Kim CEO 1/28/20211/28/2021 BROKER BROKER Att:Att: Title:Title: Address:Address: Phone:Phone: Fax:Fax: Email:Email: Federal ID No.:Federal ID No.: Broker DRE License #:Broker DRE License #: Agent DRE License #:Agent DRE License #: AIR CRE * https://www.aircre.com * 213-687-8777 * contracts@aircre.com NOTICE: No part of the works may be reproduced in any form without permission in writing. PAGE 19 OF 19 INITIALS INITIALS © 2019 AIR CRE. All Rights Reserved.STG-27.40, Revised 11-25-2019 Produced with zipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com KW Commercial Jared Ennis & Kevin Land 740 W Alluvial Ave #102, Fresno,CA 93711 400 E. Main St., Suite 110, Visalia, CA Kevin@ / Jared@CentralCaCommercial.com Lee & Associates Alex Peck apeck@lee-associates.com 02090388 01981426 351 N Blackstone DocuSign Envelope ID: 7E1D49B4-3F86-4E92-8E6C-0DCCF8AE21D4 ADDENDUM Date: By and Between Lessor: Lessee: Property Address: (street address, city, state, zip) Paragraph In the event of any conflict between the provisions of this Addendum and the printed provisions of the Lease, this Addendum shall control. AIR CRE * https://www.aircre.com * 213-687-8777 * contracts@aircre.com NOTICE: No part of the works may be reproduced in any form without permission in writing. INITIALS INITIALS © 2017 AIR CRE. All Rights Reserved.ADD-1-03, Revised 06-10-2019 Phone:Fax: Produced with zipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com January 4, 2021 Michael A Richards STACHS, LLC 351 N Blackstone Ave, Fresno, CA 93701 Fresno CA 93705 51-53 51.) This lease is contingent upon the LESSOR perfecting a lease cancelation with the current occupant by January 25, 2021, pursuant to an agreement dated March 20, 2019. If the lease cancelation is not perfected by January 25, 2021, LESSEE reserves the option (in its sole discretion) for 14 days to terminate this lease. Furthermore, if LESSOR is unable to deliver the premises within 60 days of the lease commencement date, then LESSEE reserves the option (in its sole discretion) to terminate this lease. If the lease is terminated pursuant to this paragraph, then all monies paid will be returned to LESSEE. If the premises is not delivered to LESSEE for any period following the lease commencement date, then rent will be abated on a pro-rated basis. 52.) Clarification of Utilities: All utility services including electricity, water, trash, and gas, and janitorial shall be paid by the LESSEE. KW Commercial Central CA, 740 W Alluvial Ave #102 Fresno, CA 93711 5593028698 5594329324 Jared Ennis 351 N Blackstone DocuSign Envelope ID: 7E1D49B4-3F86-4E92-8E6C-0DCCF8AE21D4 ADDENDUM Date: By and Between Lessor: Lessee: Property Address: (street address, city, state, zip) Paragraph AIR CRE * https://www.aircre.com * 213-687-8777 * contracts@aircre.com NOTICE: No part of the works may be reproduced in any form without permission in writing. INITIALS INITIALS © 2017 AIR CRE. All Rights Reserved.ADD-1-03, Revised 06-10-2019 Phone:Fax: Produced with zipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com January 15, 2021 Michael A Richards STACHS, LLC 351 N Blackstone Ave, Fresno, CA 93701 Fresno CA 93705 54-55 55.) APPROVED SUBLESSEE: Per Section 12, Boogy Baybee, LLC shall be an approved Sublessee of the LESSEE and shall have explicit permission to conduct "cannabis delivery/retail use" to the same extent granted to LESSEE under Section 1.7 of Lease. KW Commercial Central CA, 740 W Alluvial Ave #102 Fresno, CA 93711 5593028698 5594329324 Jared Ennis 351 N Blackstone DocuSign Envelope ID: 7E1D49B4-3F86-4E92-8E6C-0DCCF8AE21D4 ARBITRATION AGREEMENT Standard Lease Addendum Dated: By and Between Lessor: Lessee: Property Address: (street address, city, state, zip) Paragraph A.ARBITRATION OF DISPUTES: Except as provided in Paragraph B below, the Parties agree to resolve any and all claims, disputes or disagreements arising under this Lease, including, but not limited to any matter relating to Lessor's failure to approve an assignment, sublease or other transfer of Lessee's interest in the Lease under Paragraph 12 of this Lease, any other defaults by Lessor, or any defaults by Lessee by and through arbitration as provided below and irrevocably waive any and all rights to the contrary. The Parties agree to at all times conduct themselves in strict, full, complete and timely accordance with the terms hereof and that any attempt to circumvent the terms of this Arbitration Agreement shall be absolutely null and void and of no force or effect whatsoever. B.DISPUTES EXCLUDED FROM ARBITRATION: The following claims, disputes or disagreements under this Lease are expressly excluded from the arbitration procedures set forth herein: 1. Disputes for which a different resolution determination is specifically set forth in this Lease, 2. All claims by either party which (a) seek anything other than enforcement or determination of rights under this Lease, or (b) are primarily founded upon matters of fraud, willful misconduct, bad faith or any other allegations of tortious action, and seek the award of punitive or exemplary damages, 3. Claims relating to (a) Lessor's exercise of any unlawful detainer rights pursuant to applicable law or (b) rights or remedies used by Lessor to gain possession of the Premises or terminate Lessee's right of possession to the Premises, all of which disputes shall be resolved by suit filed in the applicable court of jurisdiction, the decision of which court shall be subject to appeal pursuant to applicable law 4. Any claim or dispute that is within the jurisdiction of the Small Claims Court and 5. All claims arising under Paragraph 39 of this Lease. C.APPOINTMENT OF AN ARBITRATOR: All disputes subject to this Arbitration Agreement, shall be determined by binding arbitration before: a retired judge of the applicable court of jurisdiction (e.g., the Superior Court of the State of California) affiliated with Judicial Arbitration & Mediation Services, Inc. ("JAMS"), the American Arbitration Association ("AAA") under its commercial arbitration rules, , , or as may be otherwise mutually agreed by Lessor and Lessee (the "Arbitrator"). In the event that the parties elect to use an arbitrator other than one affiliated with JAMS or AAA then such arbitrator shall be obligated to comply with the Code of Ethics for Arbitrators in Commercial Disputes (see:http://www.adr.org/aaa/ShowProperty?nodeId=/UCM/ADRSTG_003867 ). Such arbitration shall be initiated by the Parties, or either of them, within ten (10) days after either party sends written notice (the "Arbitration Notice") of a demand to arbitrate by registered or certified mail to the other party and to the Arbitrator. The Arbitration Notice shall contain a description of the subject matter of the arbitration, the dispute with respect thereto, the amount involved, if any, and the remedy or determination sought. If the Parties have agreed to use JAMS they may agree on a retired judge from the JAMS panel. If they are unable to agree within ten days, JAMS will provide a list of three available judges and each party may strike one. The remaining judge (or if there are two, the one selected by JAMS) will serve as the Arbitrator. If the Parties have elected to utilize AAA or some other organization, the Arbitrator shall be selected in accordance with said organization's rules. In the event the Arbitrator is not selected as provided for above for any reason, the party initiating arbitration shall apply to the appropriate Court for the appointment of a qualified retired judge to act as the Arbitrator. PAGE 1 OF 2 INITIALS INITIALS © 2017 AIR CRE. All Rights Reserved.ARB-3.03, Revised 06-10-2019 Phone:Fax: Produced with zipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com January 4, 2021 Michael A Richards STACHS, LLC 351 N Blackstone Ave, Fresno, CA 93701 Fresno CA 93705 56 X KW Commercial Central CA, 740 W Alluvial Ave #102 Fresno, CA 93711 5593028698 5594329324 Jared Ennis 351 N Blackstone DocuSign Envelope ID: 7E1D49B4-3F86-4E92-8E6C-0DCCF8AE21D4 D.ARBITRATION PROCEDURE: 1.PRE-HEARING ACTIONS.The Arbitrator shall schedule a pre-hearing conference to resolve procedural matters, arrange for the exchange of information, obtain stipulations, and narrow the issues. The Parties will submit proposed discovery schedules to the Arbitrator at the pre-hearing conference. The scope and duration of discovery will be within the sole discretion of the Arbitrator. The Arbitrator shall have the discretion to order a pre-hearing exchange of information by the Parties, including, without limitation, production of requested documents, exchange of summaries of testimony of proposed witnesses, and examination by deposition of parties and third-party witnesses. This discretion shall be exercised in favor of discovery reasonable under the circumstances. The Arbitrator shall issue subpoenas and subpoenas duces tecum as provided for in the applicable statutory or case law (e.g., in California Code of Civil Procedure Section 1282.6). 2.THE DECISION.The arbitration shall be conducted in the city or county within which the Premises are located at a reasonably convenient site. Any Party may be represented by counsel or other authorized representative. In rendering a decision(s), the Arbitrator shall determine the rights and obligations of the Parties according to the substantive laws and the terms and provisions of this Lease. The Arbitrator's decision shall be based on the evidence introduced at the hearing, including all logical and reasonable inferences therefrom. The Arbitrator may make any determination and/or grant any remedy or relief that is just and equitable. The decision must be based on, and accompanied by, a written statement of decision explaining the factual and legal basis for the decision as to each of the principal controverted issues. The decision shall be conclusive and binding, and it may thereafter be confirmed as a judgment by the court of applicable jurisdiction, subject only to challenge on the grounds set forth in the applicable statutory or case law (e.g., in California Code of Civil Procedure Section 1286.2). The validity and enforceability of the Arbitrator's decision is to be determined exclusively by the court of appropriate jurisdiction pursuant to the provisions of this Lease. The Arbitrator may award costs, including without limitation, Arbitrator's fees and costs, attorneys' fees, and expert and witness costs, to the prevailing party, if any, as determined by the Arbitrator in his discretion. Whenever a matter which has been submitted to arbitration involves a dispute as to whether or not a particular act or omission (other than a failure to pay money) constitutes a Default, the time to commence or cease such action shall be tolled from the date that the Notice of Arbitration is served through and until the date the Arbitrator renders his or her decision. Provided, however, that this provision shall NOT apply in the event that the Arbitrator determines that the Arbitration Notice was prepared in bad faith. Whenever a dispute arises between the Parties concerning whether or not the failure to make a payment of money constitutes a default, the service of an Arbitration Notice shall NOT toll the time period in which to pay the money. The Party allegedly obligated to pay the money may, however, elect to pay the money "under protest" by accompanying said payment with a written statement setting forth the reasons for such protest. If thereafter, the Arbitrator determines that the Party who received said money was not entitled to such payment, said money shall be promptly returned to the Party who paid such money under protest together with Interest thereon as defined in Paragraph 13.5. If a Party makes a payment "under protest" but no Notice of Arbitration is filed within thirty days, then such protest shall be deemed waived. (See also Paragraph 42 or 43) AIR CRE * https://www.aircre.com * 213-687-8777 * contracts@aircre.com NOTICE: No part of the works may be reproduced in any form without permission in writing. PAGE 2 OF 2 INITIALS INITIALS © 2017 AIR CRE. All Rights Reserved.ARB-3.03, Revised 06-10-2019 Produced with zipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com 351 N Blackstone DocuSign Envelope ID: 7E1D49B4-3F86-4E92-8E6C-0DCCF8AE21D4 GUARANTY OF LEASE WHEREAS,, hereinafter "Lessor", and , hereinafter "Lessee", are about to execute a document entitled "Lease" dated concerning the premises commonly known as wherein Lessor will lease the premises to Lessee, and WHEREAS,hereinafter "Guarantors" have a financial interest in Lessee, and WHEREAS, Lessor would not execute the Lease if Guarantors did not execute and deliver to Lessor this Guaranty of Lease. NOW THEREFORE, in consideration of the execution of said Lease by Lessor and as a material inducement to Lessor to execute said Lease, Guarantors hereby jointly, severally, unconditionally and irrevocably guarantee the prompt payment by Lessee of all rents and all other sums payable by Lessee under said Lease and the faithful and prompt performance by Lessee of each and every one of the terms, conditions and covenants of said Lease to be kept and performed by Lessee. It is specifically agreed by Lessor and Guarantors that: (i) the terms of the foregoing Lease may be modified by agreement between Lessor and Lessee, or by a course of conduct, and (ii) said Lease may be assigned by Lessor or any assignee of Lessor without consent or notice to Guarantors and that this Guaranty shall guarantee the performance of said Lease as so modified. This Guaranty shall not be released, modified or affected by the failure or delay on the part of Lessor to enforce any of the rights or remedies of the Lessor under said Lease. No notice of default by Lessee under the Lease need be given by Lessor to Guarantors, it being specifically agreed that the guarantee of the undersigned is a continuing guarantee under which Lessor may proceed immediately against Lessee and/or against Guarantors following any breach or default by Lessee or for the enforcement of any rights which Lessor may have as against Lessee under the terms of the Lease or at law or in equity. Lessor shall have the right to proceed against Guarantors following any breach or default by Lessee under the Lease without first proceeding against Lessee and without previous notice to or demand upon either Lessee or Guarantors. Guarantors hereby waive (a) notice of acceptance of this Guaranty, (b) demand of payment, presentation and protest, (c) all right to assert or plead any statute of limitations relating to this Guaranty or the Lease, (d) any right to require the Lessor to proceed against the Lessee or any other Guarantor or any other person or entity liable to Lessor, (e) any right to require Lessor to apply to any default any security deposit or other security it may hold under the Lease, (f) any right to require Lessor to proceed under any other remedy Lessor may have before proceeding against Guarantors, (g) any right of subrogation that Guarantors may have against Lessee. Guarantors do hereby subordinate all existing or future indebtedness of Lessee to Guarantors to the obligations owed to Lessor under the Lease and this Guaranty. PAGE 1 OF 2INITIALS INITIALS © 2017 AIR CRE. All Rights Reserved.GR-3.22, Revised 06-10-2019 Phone:Fax: Produced with zipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com Michael A Richards STACHS, LLC January 4, 2021 351 N Blackstone Ave, Fresno, CA 93701 STACHS, LLC KW Commercial Central CA, 740 W Alluvial Ave #102 Fresno, CA 93711 5593028698 5594329324 Jared Ennis 351 N Blackstone DocuSign Envelope ID: 7E1D49B4-3F86-4E92-8E6C-0DCCF8AE21D4 If a Guarantor is married, such Guarantor expressly agrees that recourse may be had against his or her separate property for all of the obligations hereunder. The obligations of Lessee under the Lease to execute and deliver estoppel statements and financial statements, as therein provided, shall be deemed to also require the Guarantors to do and provide the same to Lessor. The failure of the Guarantors to provide the same to Lessor shall constitute a default under the Lease. The term "Lessor" refers to and means the Lessor named in the Lease and also Lessor's successors and assigns. So long as Lessor's interest in the Lease, the leased premises or the rents, issues and profits therefrom, are subject to any mortgage or deed of trust or assignment for security, no acquisition by Guarantors of the Lessor's interest shall affect the continuing obligation of Guarantors under this Guaranty which shall nevertheless continue in full force and effect for the benefit of the mortgagee, beneficiary, trustee or assignee under such mortgage, deed of trust or assignment and their successors and assigns. The term "Lessee" refers to and means the Lessee named in the Lease and also Lessee's successors and assigns. Any recovery by Lessor from any other guarantor or insurer shall first be credited to the portion of Lessee's indebtedness to Lessor which exceeds the maximum liability of Guarantors under this Guaranty. No provision of this Guaranty or right of the Lessor can be waived, nor can the Guarantors be released from their obligations except in writing signed by the Lessor. Any litigation concerning this Guaranty shall be initiated in a state court of competent jurisdiction in the county in which the leased premises are located and the Guarantors consent to the jurisdiction of such court. This Guaranty shall be governed by the laws of the State in which the leased premises are located and for the purposes of any rules regarding conflicts of law the parties shall be treated as if they were all residents or domiciles of such State. In the event any action be brought by said Lessor against Guarantors hereunder to enforce the obligation of Guarantors hereunder, the unsuccessful party in such action shall pay to the prevailing party therein a reasonable attorney's fee. The attorney's fee award shall not be computed in accordance with any court fee schedule, but shall be such as to full reimburse all attorney's fees reasonably incurred. If any Guarantor is a corporation, partnership, or limited liability company, each individual executing this Guaranty on said entity's behalf represents and warrants that he or she is duly authorized to execute this Guaranty on behalf of such entity. Signatures to this Guaranty accomplished by means of electronic signature or similar technology shall be legal and binding. If this Form has been filled in, it has been prepared for submission to your attorney for his approval. No representation or recommendation is made by the AIR CRE, the real estate broker or its agents or employees as to the legal sufficiency, legal effect, or tax consequences of this Form or the transaction relating thereto. GUARANTORS Executed at: On: By:By: Name Printed:Name Printed: Title:Title: Address:Address: AIR CRE * https://www.aircre.com * 213-687-8777 * contracts@aircre.com NOTICE: No part of the works may be reproduced in any form without permission in writing. PAGE 2 OF 2INITIALS INITIALS © 2017 AIR CRE. All Rights Reserved.GR-3.22, Revised 06-10-2019 Produced with zipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com STACHS, LLC DBA 351 N Blackstone DocuSign Envelope ID: 7E1D49B4-3F86-4E92-8E6C-0DCCF8AE21D4 Tony Kim 1/28/2021---- OPTION(S) TO EXTEND STANDARD LEASE ADDENDUM Dated: By and Between Lessor: Lessee: Property Address: (street address, city, state, zip) Paragraph A. OPTION(S) TO EXTEND: Lessor hereby grants to Lessee the option to extend the term of this Lease for additional month period(s) commencing when the prior term expires upon each and all of the following terms and conditions: (i) In order to exercise an option to extend, Lessee must give written notice of such election to Lessor and Lessor must receive the same at least but not more than months prior to the date that the option period would commence, time being of the essence. If proper notification of the exercise of an option is not given and/or received, such option shall automatically expire. Options (if there are more than one) may only be exercised consecutively. (ii) The provisions of paragraph 39, including those relating to Lessee's Default set forth in paragraph 39.4 of this Lease, are conditions of this Option. (iii) Except for the provisions of this Lease granting an option or options to extend the term, all of the terms and conditions of this Lease except where specifically modified by this option shall apply. (iv) This Option is personal to the original Lessee, and cannot be assigned or exercised by anyone other than said original Lessee and only while the original Lessee is in full possession of the Premises and without the intention of thereafter assigning or subletting. (v) The monthly rent for each month of the option period shall be calculated as follows, using the method(s) indicated below: (Check Method(s) to be Used and Fill in Appropriately) I. Cost of Living Adjustment(s) (COLA) a. On (Fill in COLA Dates): the Base Rent shall be adjusted by the change, if any, from the Base Month specified below, in the Consumer Price Index of the Bureau of Labor Statistics of the U.S. Department of Labor for (select one): CPI W (Urban Wage Earners and Clerical Workers) or CPI U (All Urban Consumers), for (Fill in Urban Area): All Items (1982-1984 = 100), herein referred to as "CPI". b. The monthly rent payable in accordance with paragraph A.I.a. of this Addendum shall be calculated as follows: the Base Rent set forth in paragraph 1.5 of the attached Lease, shall be multiplied by a fraction the numerator of which shall be the CPI of the calendar month 2 months prior to the month(s) specified in paragraph A.I.a. above during which the adjustment is to take effect, and the denominator of which shall be the CPI of the calendar month which is 2 months prior to (select one): the first month of the term of this Lease as set forth in paragraph 1.3 ("Base Month") or (Fill in Other "Base Month"): The sum so calculated shall constitute the new monthly rent hereunder, but in no event, shall any such new monthly rent be less than the rent payable for the month immediately preceding the rent adjustment. PAGE 1 OF 3 INITIALS INITIALS © 2017 AIR CRE. All Rights Reserved.OE-6.02, Revised 06-10-2019 Phone:Fax: Produced with zipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com January 4, 2021 Michael A Richards STACHS, LLC 351 N Blackstone Ave, Fresno, CA 93701 Fresno CA 93705 57 2 60 4 6 KW Commercial Central CA, 740 W Alluvial Ave #102 Fresno, CA 93711 5593028698 5594329324 Jared Ennis 351 N Blackstone DocuSign Envelope ID: 7E1D49B4-3F86-4E92-8E6C-0DCCF8AE21D4 c. In the event the compilation and/or publication of the CPI shall be transferred to any other governmental department or bureau or agency or shall be discontinued, then the index most nearly the same as the CPI shall be used to make such calculation. In the event that the Parties cannot agree on such alternative index, then the matter shall be submitted for decision to the American Arbitration Association in accordance with the then rules of said Association and the decision of the arbitrators shall be binding upon the parties. The cost of said Arbitration shall be paid equally by the Parties. II. Market Rental Value Adjustment(s) (MRV) a. On (Fill in MRV Adjustment Date(s)) the Base Rent shall be adjusted to the "Market Rental Value" of the property as follows: 1) Four months prior to each Market Rental Value Adjustment Date described above, the Parties shall attempt to agree upon what the new MRV will be on the adjustment date. If agreement cannot be reached, within thirty days, then: (a) Lessor and Lessee shall immediately appoint a mutually acceptable appraiser or broker to establish the new MRV within the next 30 days. Any associated costs will be split equally between the Parties, or (b) Both Lessor and Lessee shall each immediately make a reasonable determination of the MRV and submit such determination, in writing, to arbitration in accordance with the following provisions: (i) Within 15 days thereafter, Lessor and Lessee shall each select an independent third party appraiser or broker ("Consultant"- check one) of their choice to act as an arbitrator (Note: the parties may not select either of the Brokers that was involved in negotiating the Lease). The two arbitrators so appointed shall immediately select a third mutually acceptable Consultant to act as a third arbitrator. (ii) The 3 arbitrators shall within 30 days of the appointment of the third arbitrator reach a decision as to what the actual MRV for the Premises is, and whether Lessor's or Lessee's submitted MRV is the closest thereto. The decision of a majority of the arbitrators shall be binding on the Parties. The submitted MRV which is determined to be the closest to the actual MRV shall thereafter be used by the Parties. (iii) If either of the Parties fails to appoint an arbitrator within the specified 15 days, the arbitrator timely appointed by one of them shall reach a decision on his or her own, and said decision shall be binding on the Parties. (iv) The entire cost of such arbitration shall be paid by the party whose submitted MRV is not selected, ie. the one that is NOT the closest to the actual MRV. 2) When determining MRV, the Lessor, Lessee and Consultants shall consider the terms of comparable market transactions which shall include, but not limited to, rent, rental adjustments, abated rent, lease term and financial condition of tenants. 3) Notwithstanding the foregoing, the new MRV shall not be less than the rent payable for the month immediately preceding the rent adjustment. b. Upon the establishment of each New Market Rental Value: 1) the new MRV will become the new "Base Rent" for the purpose of calculating any further Adjustments, and 2) the first month of each Market Rental Value term shall become the new "Base Month" for the purpose of calculating any further Adjustments. III. Fixed Rental Adjustment(s) (FRA) The Base Rent shall be increased to the following amounts on the dates set forth below: On (Fill in FRA Adjustment Date(s)): IV. Initial Term Adjustments. The formula used to calculate adjustments to the Base Rate during the original Term of the Lease shall continue to be used during the extended term. PAGE 2 OF 3 INITIALS INITIALS © 2017 AIR CRE. All Rights Reserved.OE-6.02, Revised 06-10-2019 Produced with zipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com X February 1, 2026 February 1, 2027 February 1, 2028 February 1, 2029 February 1, 2030 February 1, 2031 February 1, 2032 February 1, 2033 February 1, 2034 February 1, 2035 351 N Blackstone DocuSign Envelope ID: 7E1D49B4-3F86-4E92-8E6C-0DCCF8AE21D4 B. NOTICE: Unless specified otherwise herein, notice of any rental adjustments, other than Fixed Rental Adjustments, shall be made as specified in paragraph 23 of the Lease. C. BROKER'S FEE: The Brokers shall be paid a Brokerage Fee for each adjustment specified above in accordance with paragraph 15 of the Lease or if applicable, paragraph 9 of the Sublease. AIR CRE * https://www.aircre.com * 213-687-8777 * contracts@aircre.com NOTICE: No part of the works may be reproduced in any form without permission in writing. PAGE 3 OF 3 INITIALS INITIALS © 2017 AIR CRE. All Rights Reserved.OE-6.02, Revised 06-10-2019 Produced with zipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com 351 N Blackstone DocuSign Envelope ID: 7E1D49B4-3F86-4E92-8E6C-0DCCF8AE21D4 OPTION TO PURCHASE Standard Lease Addendum Dated: By and Between Lessor: Lessee: Property Address: (street address, city, state, zip) Paragraph (a) Lessor hereby grants to Lessee an option to purchase the Premises upon the terms and conditions herein set forth. (b) In order to exercise this option to purchase, Lessee must give written notice of the exercise of the option to Lessor during the period from to (the "Option Period"), time being of the essence. If such notice is not so given, this option shall automatically expire. At the same time the option is exercised, Lessee must deliver to Lessor a cashier's check in the amount of payable to , as and for the Deposit referred to in paragraph 4.1 of the Standard Offer, Agreement and Escrow Instructions for the Purchase of Real Estate. (c) The provisions of paragraph 39, including those relating to Lessee's Default set forth in paragraph 39.4 of this Lease are conditions of this Option. (d) If Lessee elects to exercise this option to purchase as provided above, the transfer of title to Lessee shall occur on the close of escrow and until that time the terms of this Lease shall remain in full force and effect. (e) If Lessee elects to exercise this option to purchase, the purchase price to be paid by Lessee shall be $ (f) Within 10 days after this option to purchase is exercised, Lessor and Lessee shall give instructions to consummate the sale to , located at , who shall act as escrow holder, on the normal and usual escrow forms then used by such escrow holder, as follows: (i) Escrow shall close 40 or days after the exercise of the option to purchase by Lessee; (ii) Lessor shall deposit the check referred to in paragraph (b) into escrow upon opening thereof, with the balance of the purchase price to be deposited into escrow no later then 2:00 P.M. on the last business day prior to the expected closing date; (iii) The parties agree to execute any additional instructions as are normal and usual; (iv) The balance of the terms and conditions of sale shall be as set forth in the AIR Commercial Real Estate Association "STANDARD OFFER, AGREEMENT AND ESCROW INSTRUCTIONS FOR THE PURCHASE OF REAL ESTATE", a copy of which is attached hereto, except for the following: and paragraphs 4.2; 5; 6; 9.1 a,b,c,d,e,h,j,k and l; and 20, which do not apply. PAGE 1 OF 2 INITIALS INITIALS © 2017 AIR CRE. All Rights Reserved.OP-6.03, Revised 06-10-2019 Phone:Fax: Produced with zipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com January 4, 2021 Michael A Richards STACHS, LLC 351 N Blackstone Ave, Fresno, CA 93701 Fresno CA 93705 58 February 1, 2021 January 31, 2026 Michal A Richards Chicago Title (Sue Meyer)7330 N Palm Ave Ste #101 Fresno CA 93711 30 KW Commercial Central CA, 740 W Alluvial Ave #102 Fresno, CA 93711 5593028698 5594329324 Jared Ennis 351 N Blackstone DocuSign Envelope ID: 7E1D49B4-3F86-4E92-8E6C-0DCCF8AE21D4 (g) Either Lessor or Lessee shall, upon request of the other, execute, acknowledge and deliver to the other a short form memorandum of this Lease for recording purposes. The Party requesting recordation shall be responsible for payment of any fees applicable thereto. (h) In the event that this option to purchase is not exercised by Lessee in a timely fashion, the Lessee shall, upon request of Lessor, execute, acknowledge and deliver to Lessor a quit claim deed releasing Lessee's interest in such option. Lessor shall be responsible for the preparation of such deed and the payment of any fees applicable to the recording thereof. WARNING: LESSEE SHOULD NOT EXERCISE THIS OPTION UNTIL LESSEE HAS COMPLETED SUCH INVESTIGATION AS MAY BE APPROPRIATE, OBTAINED ANY NECESSARY FINANCING, AND IS OTHERWISE IN A POSITION TO COMPLETE SUCH PURCHASE. AIR CRE * https://www.aircre.com * 213-687-8777 * contracts@aircre.com NOTICE: No part of the works may be reproduced in any form without permission in writing. PAGE 2 OF 2 INITIALS INITIALS © 2017 AIR CRE. All Rights Reserved.OP-6.03, Revised 06-10-2019 Produced with zipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com 351 N Blackstone DocuSign Envelope ID: 7E1D49B4-3F86-4E92-8E6C-0DCCF8AE21D4 STANDARD OFFER, AGREEMENT AND ESCROW INSTRUCTIONS FOR PURCHASE OF REAL ESTATE (Non-Residential) Dated: 1. Buyer. 1.1 , ("Buyer") hereby offers to purchase the real property, hereinafter described, from the owner thereof ("Seller") (collectively, the "Parties"or individually, a "Party"), through an escrow ("Escrow") to close 30 or days after the waiver or satisfaction of the Buyer's Contingencies, ("Expected Closing Date") to be held by ("Escrow Holder") whose address is , Phone No., Facsimile No. upon the terms and conditions set forth in this agreement ("Agreement"). Buyer shall have the right to assign Buyer's rights hereunder, but any such assignment shall not relieve Buyer of Buyer's obligations herein unless Seller expressly releases Buyer. 1.2 The term "Date of Agreement"as used herein shall be the date when by execution and delivery (as defined in paragraph 20.2) of this document or a subsequent counteroffer thereto, Buyer and Seller have reached agreement in writing whereby Seller agrees to sell, and Buyer agrees to purchase, the Property upon terms accepted by both Parties. 2. Property. 2.1 The real property ("Property") that is the subject of this offer consists of (insert a brief physical description) is located in the County of , is commonly known as (street address, city, state, zip) and is legally described as: (APN:). 2.2 If the legal description of the Property is not complete or is inaccurate, this Agreement shall not be invalid and the legal description shall be completed or corrected to meet the requirements of ("Title Company"), which shall issue the title policy hereinafter described. 2.3 The Property includes, at no additional cost to Buyer, the permanent improvements thereon, including those items which pursuant to applicable law are a part of the property, as well as the following items, if any, owned by Seller and at present located on the Property: electrical distribution systems (power panel, bus ducting, conduits, disconnects, lighting fixtures); telephone distribution systems (lines, jacks and connections only); space heaters; heating, ventilating, air conditioning equipment ("HVAC"); air lines; fire sprinkler systems; security and fire detection systems; carpets; window coverings; wall coverings; and (collectively, the "Improvements"). 2.4 The fire sprinkler monitor: is owned by Seller and included in the Purchase Price, is leased by Seller, and Buyer will need to negotiate a new lease with the fire monitoring company, ownership will be determined during Escrow, or there is no fire sprinkler monitor. 2.5 Except as provided in Paragraph 2.3, the Purchase Price does not include Seller's personal property, furniture and furnishings, and all of which shall be removed by Seller prior to Closing. 3. Purchase Price. 3.1 The purchase price ("Purchase Price") to be paid by Buyer to Seller for the Property shall be $, payable as follows: (Strike if not applicable) (a) Cash down payment, including the Deposit as defined in paragraph 4.3 (or if an all cash transaction, the Purchase Price):$ (b) Amount of "New Loan" as defined in paragraph 5.1, if any:$ (c) Buyer shall take title to the Property subject to and/or assume the following existing deed(s) of trust ("Existing Deed(s) of Trust") securing the existing promissory note(s) ("Existing Note(s)"): PAGE 1 OF 11 INITIALS INITIALS © 2019 AIR CRE. All Rights Reserved.OFA-20.20, Revised 11-25-2019 Phone:Fax: Produced with zipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com January 18, 2021 STACHS, LLC 15 Chicago Title (Sue Meyer) 7330 N Palm Ave #101, Fresno, email address meyers@CTT.com (559)451-3736 (559)431-8936 one existing +/- 2,890 Sq. Ft. commercial retail building on +/-7,600 Sq. Ft. lot (0.17 Acres total) zoned C-6 Commercial on A.P.N. 459-153-05 Fresno 351 N Blackstone Ave, Fresno, CA 93701 Fresno CA 93705 to be provided by title company 459-1253-05 Chicago Title Company X KW Commercial Central CA, 740 W Alluvial Ave #102 Fresno, CA 93711 5593028698 5594329324 Jared Ennis 351 N Blackstone DocuSign Envelope ID: 7E1D49B4-3F86-4E92-8E6C-0DCCF8AE21D4 (i) An Existing Note ("First Note") with an unpaid principal balance as of the Closing of approximately:$ Said First Note is payable at $per month, including interest at the rate of % per annum until paid (and/or the entire unpaid balance is due on ). (ii) An Existing Note ("Second Note") with an unpaid principal balance as of the Closing of approximately:$ Said Second Note is payable at $per month, including interest at the rate of % per annum until paid (and/or the entire unpaid balance is due on ). (d) Buyer shall give Seller a deed of trust ("Purchase Money Deed of Trust") on the property, to secure the promissory note of Buyer to Seller described in paragraph 6 ("Purchase Money Note") in the amount of:$ Total Purchase Price:$ 3.2 If Buyer is taking title to the Property subject to, or assuming, an Existing Deed of Trust and such deed of trust permits the beneficiary to demand payment of fees including, but not limited to, points, processing fees, and appraisal fees as a condition to the transfer of the Property, Buyer agrees to pay such fees up to a maximum of 1.5% of the unpaid principal balance of the applicable Existing Note. 4. Deposits. 4.1 Buyer has delivered to Broker a check in the sum of $, payable to Escrow Holder, to be delivered by Broker to Escrow Holder within 2 or business days after both Parties have executed this Agreement and the executed Agreement has been delivered to Escrow Holder,or within 2 or business days after both Parties have executed this Agreement and the executed Agreement has been delivered to Escrow Holder Buyer shall deliver to Escrow Holder a check in the sum of $. If said check is not received by Escrow Holder within said time period then Seller may elect to unilaterally terminate this transaction by giving written notice of such election to Escrow Holder whereupon neither Party shall have any further liability to the other under this Agreement. Should Buyer and Seller not enter into an agreement for purchase and sale, Buyer's check or funds shall, upon request by Buyer, be promptly returned to Buyer. 4.2 Additional deposits: (a) Within 5 business days after the Date of Agreement, Buyer shall deposit with Escrow Holder the additional sum of $to be applied to the Purchase Price at the Closing. (b) Within 5 business days after the contingencies discussed in paragraph 9.1 (a) through (m) are approved or waived, Buyer shall deposit with Escrow Holder the additional sum of $to be applied to the Purchase Price at the Closing. (c) If an Additional Deposit is not received by Escrow Holder within the time period provided then Seller may notify Buyer, Escrow Holder, and Brokers, in writing that, unless the Additional Deposit is received by Escrow Holder within 2 business days following said notice, the Escrow shall be deemed terminated without further notice or instructions. 4.3 Escrow Holder shall deposit the funds deposited with it by Buyer pursuant to paragraphs 4.1 and 4.2 (collectively the "Deposit"), in a State or Federally chartered bank in an interest bearing account whose term is appropriate and consistent with the timing requirements of this transaction. The interest therefrom shall accrue to the benefit of Buyer, who hereby acknowledges that there may be penalties or interest forfeitures if the applicable instrument is redeemed prior to its specified maturity. Buyer's Federal Tax Identification Number is . NOTE: Such interest bearing account cannot be opened until Buyer's Federal Tax Identification Number is provided. 4.4 Notwithstanding the foregoing, within 5 days after Escrow Holder receives the monies described in paragraph 4.1 above, Escrow Holder shall release $100 of said monies to Seller as and for independent consideration for Seller's' execution of this Agreement and the granting of the contingency period to Buyer as herein provided. Such independent consideration is non-refundable to Buyer but shall be credited to the Purchase Price in the event that the purchase of the Property is completed. 4.5 Upon waiver of all of Buyer's contingencies the Deposit shall become non-refundable but applicable to the Purchase Price except in the event of a Seller breach, or in the event that the Escrow is terminated pursuant to the provisions of Paragraph 9.1(n) (Destruction, Damage or Loss) or 9.1(o) (Material Change). 5. Financing Contingency.(Strike if not applicable) 5.1 This offer is contingent upon Buyer obtaining from an insurance company, financial institution or other lender, a commitment to lend to Buyer a sum equal to at least % of the Purchase Price, on terms acceptable to Buyer. Such loan ("New Loan") shall be secured by a first deed of trust or mortgage on the Property. If this Agreement provides for Seller to carry back junior financing, then Seller shall have the right to approve the terms of the New Loan. Seller shall have 7 days from receipt of the commitment setting forth the proposed terms of the New Loan to approve or disapprove of such proposed terms. If Seller fails to notify Escrow Holder, in writing, of the disapproval within said 7 days it shall be conclusively presumed that Seller has approved the terms of the New Loan. 5.2 If Buyer shall fail to notify its Broker, Escrow Holder and Seller, in writing within days following the Date of Agreement, that the New Loan has not been obtained, it shall be conclusively presumed that Buyer has either obtained said New Loan or has waived this New Loan contingency. 5.3 If Buyer shall notify its Broker, Escrow Holder and Seller, in writing, within the time specified in paragraph 5.2 hereof, that Buyer has not obtained said New Loan, this Agreement shall be terminated, and Buyer shall be entitled to the prompt return of the Deposit, plus any interest earned thereon, less only Escrow Holder and Title Company cancellation fees and costs, which Buyer shall pay. 6. Seller Financing (Purchase Money Note).(Strike if not applicable) 6.1 If Seller approves Buyer's financials (see paragraph 6.5) the Purchase Money Note shall provide for interest on unpaid principal at the rate of % per annum, with principal and interest paid as follows: . PAGE 2 OF 11 INITIALS INITIALS © 2019 AIR CRE. All Rights Reserved.OFA-20.20, Revised 11-25-2019 Produced with zipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com X 3 351 N Blackstone DocuSign Envelope ID: 7E1D49B4-3F86-4E92-8E6C-0DCCF8AE21D4 The Purchase Money Note and Purchase Money Deed of Trust shall be on the current forms commonly used by Escrow Holder, and be junior and subordinate only to the Existing Note(s) and/or the New Loan expressly called for by this Agreement. 6.2 The Purchase Money Note and/or the Purchase Money Deed of Trust shall contain provisions regarding the following (see also paragraph 10.3 (b)): (a)Prepayment.Principal may be prepaid in whole or in part at any time without penalty, at the option of the Buyer. (b)Late Charge.A late charge of 6% shall be payable with respect to any payment of principal, interest, or other charges, not made within 10 days after it is due. (c)Due On Sale.In the event the Buyer sells or transfers title to the Property or any portion thereof, then the Seller may, at Seller's option, require the entire unpaid balance of said Note to be paid in full. 6.3 If the Purchase Money Deed of Trust is to be subordinate to other financing, Escrow Holder shall, at Buyer's expense prepare and record on Seller's behalf a request for notice of default and/or sale with regard to each mortgage or deed of trust to which it will be subordinate. 6.4 WARNING: CALIFORNIA LAW DOES NOT ALLOW DEFICIENCY JUDGEMENTS ON SELLER FINANCING. IF BUYER ULTIMATELY DEFAULTS ON THE LOAN, SELLER'S SOLE REMEDY IS TO FORECLOSE ON THE PROPERTY. 6.5 Seller's obligation to provide financing is contingent upon Seller's reasonable approval of Buyer's financial condition. Buyer to provide a current financial statement and copies of its Federal tax returns for the last 3 years to Seller within 10 days following the Date of Agreement. Seller has 10 days following receipt of such documentation to satisfy itself with regard to Buyer's financial condition and to notify Escrow Holder as to whether or not Buyer's financial condition is acceptable. If Seller fails to notify Escrow Holder, in writing, of the disapproval of this contingency within said time period, it shall be conclusively presumed that Seller has approved Buyer's financial condition. If Seller is not satisfied with Buyer's financial condition or if Buyer fails to deliver the required documentation then Seller may notify Escrow Holder in writing that Seller Financing will not be available, and Buyer shall have the option, within 10 days of the receipt of such notice, to either terminate this transaction or to purchase the Property without Seller financing. If Buyer fails to notify Escrow Holder within said time period of its election to terminate this transaction then Buyer shall be conclusively presumed to have elected to purchase the Property without Seller financing. If Buyer elects to terminate, Buyer's Deposit shall be refunded less Title Company and Escrow Holder cancellation fees and costs, all of which shall be Buyer's obligation. 7. Real Estate Brokers. 7.1 Each Party acknowledges receiving a Disclosure Regarding Real Estate Agency Relationship, confirms and consents to the following agency relationships in this transaction with the following real estate brokers ("Broker(s)") and/or their agents ("Agent(s)"): Seller's Brokerage Firm License No.Is the broker of (check one): the Seller; or both the Buyer and Seller (dual agent). Seller's Agent License No.Is (check one): the Seller's Agent (salesperson or broker associate); or both the Buyer's Agent Agent and the Seller's Agent (dual agent). Buyer's Brokerage Firm License No.Is the broker of (check one): the Buyer; or both the Buyer and Seller (dual agent). Buyer's Agent License No.Is (check one): the Buyer's Agent (salesperson or broker associate); or both the Buyer's Agent Agent and the Seller's Agent (dual agent). The Parties acknowledge that other than the Brokers and Agents listed above, there are no other brokers and agents representing the Parties or due any fees and/or commissions under this Agreement. Buyer shall use the services of Buyer's Broker exclusively in connection with any and all negotiations and offers with respect to the Property for a period of 1 year from the date inserted for reference purposes at the top of page 1. 7.2 Buyer and Seller each represent and warrant to the other that he/she/it has had no dealings with any person, firm, broker, agent or finder in connection with the negotiation of this Agreement and/or the consummation of the purchase and sale contemplated herein, other than the Brokers and Agents named in paragraph 7.1, and no broker, agent or other person, firm or entity, other than said Brokers and Agents is/are entitled to any commission or finder's fee in connection with this transaction as the result of any dealings or acts of such Party. Buyer and Seller do each hereby agree to indemnify, defend, protect and hold the other harmless from and against any costs, expenses or liability for compensation, commission or charges which may be claimed by any broker, agent, finder or other similar party, other than said named Brokers and Agents by reason of any dealings or act of the indemnifying Party. 8. Escrow and Closing. 8.1 Upon acceptance hereof by Seller, this Agreement, including any counteroffers incorporated herein by the Parties, shall constitute not only the agreement of purchase and sale between Buyer and Seller, but also instructions to Escrow Holder for the consummation of the Agreement through the Escrow. Escrow Holder shall not prepare any further escrow instructions restating or amending the Agreement unless specifically so instructed by the Parties or a Broker herein. Subject to the reasonable approval of the Parties, Escrow Holder may, however, include its standard general escrow provisions. In the event that there is any conflict between the provisions of the Agreement and the provisions of any additional escrow instructions the provisions of the Agreement shall prevail as to the Parties and the Escrow Holder. 8.2 As soon as practical after the receipt of this Agreement and any relevant counteroffers, Escrow Holder shall ascertain the Date of Agreement as defined in paragraphs 1.2 and 20.2 and advise the Parties and Brokers, in writing, of the date ascertained. 8.3 Escrow Holder is hereby authorized and instructed to conduct the Escrow in accordance with this Agreement, applicable law and custom and practice of the community in which Escrow Holder is located, including any reporting requirements of the Internal Revenue Code. In the event of a conflict between the law of the state where the Property is located and the law of the state where the Escrow Holder is located, the law of the state where the Property is located shall prevail. 8.4 Subject to satisfaction of the contingencies herein described, Escrow Holder shall close this escrow (the "Closing") by recording a general warranty deed (a grant deed in California) and the other documents required to be recorded, and by disbursing the funds and documents in accordance with this Agreement. PAGE 3 OF 11 INITIALS INITIALS © 2019 AIR CRE. All Rights Reserved.OFA-20.20, Revised 11-25-2019 Produced with zipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com KW Commercial 01864461 X Jared Ennis & Kevin Land 01945284 X Lee & Associates 02090388 X Alex Peck 01981426 X 351 N Blackstone DocuSign Envelope ID: 7E1D49B4-3F86-4E92-8E6C-0DCCF8AE21D4 8.5 Buyer and Seller shall each pay one-half of the Escrow Holder's charges and Seller shall pay the usual recording fees and any required documentary transfer taxes. Seller shall pay the premium for a standard coverage owner's or joint protection policy of title insurance. (See also paragraph 11) 8.6 Escrow Holder shall verify that all of Buyer's contingencies have been satisfied or waived prior to Closing. The matters contained in paragraphs 9.1 subparagraphs (b), (c), (d), (e), (g), (i), (n), and (o), 9.4, 9.5, 12, 13, 14, 16, 18, 20, 21, 22, and 24 are, however, matters of agreement between the Parties only and are not instructions to Escrow Holder. 8.7 If this transaction is terminated for non-satisfaction and non-waiver of a Buyer's Contingency, as defined in paragraph 9.2 or disapproval of any other matter subject to Buyer's approval, then neither of the Parties shall thereafter have any liability to the other under this Agreement, except to the extent of a breach of any affirmative covenant or warranty in this Agreement. In the event of such termination, Buyer shall, subject to the provisions of paragraph 8.10, be promptly refunded all funds deposited by Buyer with Escrow Holder, less only the $100 provided for in paragraph 4.4 and the Title Company and Escrow Holder cancellation fees and costs, all of which shall be Buyer's obligation. If this transaction is terminated as a result of Seller's breach of this Agreement then Seller shall pay the Title Company and Escrow Holder cancellation fees and costs. 8.8 The Closing shall occur on the Expected Closing Date, or as soon thereafter as the Escrow is in condition for Closing; provided, however, that if the Closing does not occur by the Expected Closing Date and said Date is not extended by mutual instructions of the Parties, a Party not then in default under this Agreement may notify the other Party, Escrow Holder, and Brokers, in writing that, unless the Closing occurs within 5 business days following said notice, the Escrow shall be deemed terminated without further notice or instructions. 8.9 Except as otherwise provided herein, the termination of Escrow shall not relieve or release either Party from any obligation to pay Escrow Holder's fees and costs or constitute a waiver, release or discharge of any breach or default that has occurred in the performance of the obligations, agreements, covenants or warranties contained therein. 8.10 If this Escrow is termination for any reason other than Seller's breach or default, then as a condition to the return of Buyer's deposit, Buyer shall within 5 days after written request deliver to Seller, at no charge, copies of all surveys, engineering studies, soil reports, maps, master plans, feasibility studies and other similar items prepared by or for Buyer that pertain to the Property. 9. Contingencies to Closing. 9.1 The Closing of this transaction is contingent upon the satisfaction or waiver of the following contingencies.IF BUYER FAILS TO NOTIFY ESCROW HOLDER, IN WRITING, OF THE DISAPPROVAL OF ANY OF SAID CONTINGENCIES WITHIN THE TIME SPECIFIED THEREIN, IT SHALL BE CONCLUSIVELY PRESUMED THAT BUYER HAS APPROVED SUCH ITEM, MATTER OR DOCUMENT.Buyer's conditional approval shall constitute disapproval, unless provision is made by the Seller within the time specified therefore by the Buyer in such conditional approval or by this Agreement, whichever is later, for the satisfaction of the condition imposed by the Buyer. Escrow Holder shall promptly provide all Parties with copies of any written disapproval or conditional approval which it receives. With regard to subparagraphs (a) through (m) the pre-printed time periods shall control unless a different number of days is inserted in the spaces provided. (a)Disclosure.Seller shall make to Buyer, through Escrow, all of the applicable disclosures required by law (See AIR Commercial Real Estate Association ("AIR") standard form entitled "Seller's Mandatory Disclosure Statement") and provide Buyer with a completed Property Information Sheet ("Property Information Sheet") concerning the Property, duly executed by or on behalf of Seller in the current form or equivalent to that published by the AIR within 10 or days following the Date of Agreement. Buyer has 10 days from the receipt of said disclosures to approve or disapprove the matters disclosed. (b)Physical Inspection.Buyer has 10 or days following the receipt of the Property Information Sheet or the Date of Agreement, whichever is later, to satisfy itself with regard to the physical aspects and size of the Property. (c)Hazardous Substance Conditions Report.Buyer has 30 or days following the receipt of the Property Information Sheet or the Date of Agreement, whichever is later, to satisfy itself with regard to the environmental aspects of the Property. Seller recommends that Buyer obtain a Hazardous Substance Conditions Report concerning the Property and relevant adjoining properties. Any such report shall be paid for by Buyer. A "Hazardous Substance"for purposes of this Agreement is defined as any substance whose nature and/or quantity of existence, use, manufacture, disposal or effect, render it subject to Federal, state or local regulation, investigation, remediation or removal as potentially injurious to public health or welfare. A "Hazardous Substance Condition"for purposes of this Agreement is defined as the existence on, under or relevantly adjacent to the Property of a Hazardous Substance that would require remediation and/or removal under applicable Federal, state or local law. (d)Soil Inspection.Buyer has 30 or days following the receipt of the Property Information Sheet or the Date of Agreement, whichever is later, to satisfy itself with regard to the condition of the soils on the Property. Seller recommends that Buyer obtain a soil test report. Any such report shall be paid for by Buyer. Seller shall provide Buyer copies of any soils report that Seller may have within 10 days of the Date of Agreement. (e)Governmental Approvals.Buyer has 30 or days following the Date of Agreement to satisfy itself with regard to approvals and permits from governmental agencies or departments which have or may have jurisdiction over the Property and which Buyer deems necessary or desirable in connection with its intended use of the Property, including, but not limited to, permits and approvals required with respect to zoning, planning, building and safety, fire, police, handicapped and Americans with Disabilities Act requirements, transportation and environmental matters. (f)Conditions of Title.Escrow Holder shall cause a current commitment for title insurance ("Title Commitment") concerning the Property issued by the Title Company, as well as legible copies of all documents referred to in the Title Commitment ("Underlying Documents"), and a scaled and dimensioned plot showing the location of any easements to be delivered to Buyer within 10 or days following the Date of Agreement. Buyer has 10 days from the receipt of the Title Commitment, the Underlying Documents and the plot plan to satisfy itself with regard to the condition of title. The disapproval by Buyer of any monetary encumbrance, which by the terms of this Agreement is not to remain against the Property after the Closing, shall not be considered a failure of this contingency, as Seller shall have the obligation, at Seller's expense, to satisfy and remove such disapproved monetary encumbrance at or before the Closing. (g)Survey.Buyer has 30 or days following the receipt of the Title Commitment and Underlying Documents to satisfy itself with regard to any ALTA title supplement based upon a survey prepared to American Land Title Association ("ALTA") standards for an PAGE 4 OF 11 INITIALS INITIALS © 2019 AIR CRE. All Rights Reserved.OFA-20.20, Revised 11-25-2019 Produced with zipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com 30 30 351 N Blackstone DocuSign Envelope ID: 7E1D49B4-3F86-4E92-8E6C-0DCCF8AE21D4 owner's policy by a licensed surveyor, showing the legal description and boundary lines of the Property, any easements of record, and any improvements, poles, structures and things located within 10 feet of either side of the Property boundary lines. Any such survey shall be prepared at Buyer's direction and expense. If Buyer has obtained a survey and approved the ALTA title supplement, Buyer may elect within the period allowed for Buyer's approval of a survey to have an ALTA extended coverage owner's form of title policy, in which event Buyer shall pay any additional premium attributable thereto. (h)Existing Leases and Tenancy Statements.Seller shall within 10 or days following the Date of Agreement provide both Buyer and Escrow Holder with legible copies of all leases, subleases or rental arrangements (collectively,"Existing Leases") affecting the Property, and with a tenancy statement ("Estoppel Certificate") in the latest form or equivalent to that published by the AIR, executed by Seller and/or each tenant and subtenant of the Property. Seller shall use its best efforts to have each tenant complete and execute an Estoppel Certificate. If any tenant fails or refuses to provide an Estoppel Certificate then Seller shall complete and execute an Estoppel Certificate for that tenancy. Buyer has 10 days from the receipt of said Existing Leases and Estoppel Certificates to satisfy itself with regard to the Existing Leases and any other tenancy issues. (i)Owner's Association.Seller shall within 10 or days following the Date of Agreement provide Buyer with a statement and transfer package from any owner's association servicing the Property. Such transfer package shall at a minimum include: copies of the association's bylaws, articles of incorporation, current budget and financial statement. Buyer has 10 days from the receipt of such documents to satisfy itself with regard to the association. (j)Other Agreements.Seller shall within 10 or days following the Date of Agreement provide Buyer with legible copies of all other agreements ("Other Agreements") known to Seller that will affect the Property after Closing. Buyer has 10 days from the receipt of said Other Agreements to satisfy itself with regard to such Agreements. (k)Financing.If paragraph 5 hereof dealing with a financing contingency has not been stricken, the satisfaction or waiver of such New Loan contingency. (l)Existing Notes.If paragraph 3.1(c) has not been stricken, Seller shall within 10 or days following the Date of Agreement provide Buyer with legible copies of the Existing Notes, Existing Deeds of Trust and related agreements (collectively,"Loan Documents") to which the Property will remain subject after the Closing. Escrow Holder shall promptly request from the holders of the Existing Notes a beneficiary statement ("Beneficiary Statement") confirming: (1) the amount of the unpaid principal balance, the current interest rate, and the date to which interest is paid, and (2) the nature and amount of any impounds held by the beneficiary in connection with such loan. Buyer has 10 or days following the receipt of the Loan Documents and Beneficiary Statements to satisfy itself with regard to such financing. Buyer's obligation to close is conditioned upon Buyer being able to purchase the Property without acceleration or change in the terms of any Existing Notes or charges to Buyer except as otherwise provided in this Agreement or approved by Buyer, provided, however, Buyer shall pay the transfer fee referred to in paragraph 3.2 hereof. Likewise if Seller is to carry back a Purchase Money Note then Seller shall within 10 or days following the Date of Agreement provide Buyer with a copy of the proposed Purchase Money Note and Purchase Money Deed of Trust. Buyer has 10 or days from the receipt of such documents to satisfy itself with regard to the form and content thereof. (m)Personal Property.In the event that any personal property is included in the Purchase Price, Buyer has 10 or days following the Date of Agreement to satisfy itself with regard to the title condition of such personal property. Seller recommends that Buyer obtain a UCC-1 report. Any such report shall be paid for by Buyer. Seller shall provide Buyer copies of any liens or encumbrances affecting such personal property that it is aware of within 10 or days following the Date of Agreement. (n)Destruction, Damage or Loss.Subsequent to the Date of Agreement and prior to Closing there shall not have occurred a destruction, or damage or loss to, the Property or any portion thereof, from any cause whatsoever, which would cost more than $10,000.00 to repair or cure. If the cost of repair or cure is $10,000.00 or less, Seller shall repair or cure the loss prior to the Closing. Buyer shall have the option, within 10 days after receipt of written notice of a loss costing more than $10,000.00 to repair or cure, to either terminate this Agreement or to purchase the Property notwithstanding such loss, but without deduction or offset against the Purchase Price. If the cost to repair or cure is more than $10,000.00, and Buyer does not elect to terminate this Agreement, Buyer shall be entitled to any insurance proceeds applicable to such loss. Unless otherwise notified in writing, Escrow Holder shall assume no such destruction, damage or loss has occurred prior to Closing. (o)Material Change.Buyer shall have 10 days following receipt of written notice of a Material Change within which to satisfy itself with regard to such change."Material Change"shall mean a substantial adverse change in the use, occupancy, tenants, title, or condition of the Property that occurs after the date of this offer and prior to the Closing. Unless otherwise notified in writing, Escrow Holder shall assume that no Material Change has occurred prior to the Closing. (p)Seller Performance.The delivery of all documents and the due performance by Seller of each and every undertaking and agreement to be performed by Seller under this Agreement. (q)Brokerage Fee.Payment at the Closing of such brokerage fee as is specified in this Agreement or later written instructions to Escrow Holder executed by Seller and Brokers ("Brokerage Fee"). It is agreed by the Parties and Escrow Holder that Brokers are a third party beneficiary of this Agreement insofar as the Brokerage Fee is concerned, and that no change shall be made with respect to the payment of the Brokerage Fee specified in this Agreement, without the written consent of Brokers. 9.2 All of the contingencies specified in subparagraphs (a) through (m) of paragraph 9.1 are for the benefit of, and may be waived by, Buyer, and may be elsewhere herein referred to as "Buyer's Contingencies." 9.3 If any of Buyer's Contingencies or any other matter subject to Buyer's approval is disapproved as provided for herein in a timely manner ("Disapproved Item"), Seller shall have the right within 10 days following the receipt of notice of Buyer's disapproval to elect to cure such Disapproved Item prior to the Expected Closing Date ("Seller's Election"). Seller's failure to give to Buyer within such period, written notice of Seller's commitment to cure such Disapproved Item on or before the Expected Closing Date shall be conclusively presumed to be Seller's Election not to cure such Disapproved Item. If Seller elects, either by written notice or failure to give written notice, not to cure a Disapproved Item, Buyer shall have the right, within 10 days after Seller's Election to either accept title to the Property subject to such Disapproved Item, or to terminate this Agreement. Buyer's failure to notify Seller in writing of Buyer's election to accept title to the Property subject to the Disapproved Item without deduction or offset shall constitute Buyer's election to terminate this Agreement. Unless expressly provided otherwise herein, Seller's right to cure shall not apply to the remediation of Hazardous Substance Conditions or to the Financing Contingency. Unless the Parties mutually instruct otherwise, if the time periods for the satisfaction of contingencies or for Seller's and Buyer's elections would expire on a date after the Expected Closing Date, the Expected Closing Date shall be deemed extended for 3 business days following the expiration of: (a) the applicable contingency PAGE 5 OF 11 INITIALS INITIALS © 2019 AIR CRE. All Rights Reserved.OFA-20.20, Revised 11-25-2019 Produced with zipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com 10 10 10 351 N Blackstone DocuSign Envelope ID: 7E1D49B4-3F86-4E92-8E6C-0DCCF8AE21D4 period(s), (b) the period within which the Seller may elect to cure the Disapproved Item, or (c) if Seller elects not to cure, the period within which Buyer may elect to proceed with this transaction, whichever is later. 9.4 The Parties acknowledge that extensive local, state and Federal legislation establish broad liability upon owners and/or users of real property for the investigation and remediation of Hazardous Substances. The determination of the existence of a Hazardous Substance Condition and the evaluation of the impact of such a condition are highly technical and beyond the expertise of Brokers. The Parties acknowledge that they have been advised by Brokers to consult their own technical and legal experts with respect to the possible presence of Hazardous Substances on the Property or adjoining properties, and Buyer and Seller are not relying upon any investigation by or statement of Brokers with respect thereto. The Parties hereby assume all responsibility for the impact of such Hazardous Substances upon their respective interests herein. 10. Documents Required at or Before Closing: 10.1 Five days prior to the Closing date Escrow Holder shall obtain an updated Title Commitment concerning the Property from the Title Company and provide copies thereof to each of the Parties. 10.2 Seller shall deliver to Escrow Holder in time for delivery to Buyer at the Closing: (a) Grant or general warranty deed, duly executed and in recordable form, conveying fee title to the Property to Buyer. (b) If applicable, the Beneficiary Statements concerning Existing Note(s). (c) If applicable, the Existing Leases and Other Agreements together with duly executed assignments thereof by Seller and Buyer. The assignment of Existing Leases shall be on the most recent Assignment and Assumption of Lessor's Interest in Lease form published by the AIR or its equivalent. (d) An affidavit executed by Seller to the effect that Seller is not a "foreign person" within the meaning of Internal Revenue Code Section 1445 or successor statutes. If Seller does not provide such affidavit in form reasonably satisfactory to Buyer at least 3 business days prior to the Closing, Escrow Holder shall at the Closing deduct from Seller's proceeds and remit to the Internal Revenue Service such sum as is required by applicable Federal law with respect to purchases from foreign sellers. (e) If the Property is located in California, an affidavit executed by Seller to the effect that Seller is not a ''nonresident" within the meaning of California Revenue and Tax Code Section 18662 or successor statutes. If Seller does not provide such affidavit in form reasonably satisfactory to Buyer at least 3 business days prior to the Closing, Escrow Holder shall at the Closing deduct from Seller's proceeds and remit to the Franchise Tax Board such sum as is required by such statute. (g\f)If applicable, a bill of sale, duly executed, conveying title to any included personal property to Buyer. (g) If the Seller is a corporation, a duly executed corporate resolution authorizing the execution of this Agreement and the sale of the Property. 10.3 Buyer shall deliver to Seller through Escrow: (a) The cash portion of the Purchase Price and such additional sums as are required of Buyer under this Agreement shall be deposited by Buyer with Escrow Holder, by federal funds wire transfer, or any other method acceptable to Escrow Holder in immediately collectable funds, no later than 2:00 P.M. on the business day prior to the Expected Closing Date provided, however, that Buyer shall not be required to deposit such monies into Escrow if at the time set for the deposit of such monies Seller is in default or has indicated that it will not perform any of its obligations hereunder. Instead, in such circumstances in order to reserve its rights to proceed Buyer need only provide Escrow with evidence establishing that the required monies were available. (b) If a Purchase Money Note and Purchase Money Deed of Trust are called for by this Agreement, the duly executed originals of those documents, the Purchase Money Deed of Trust being in recordable form, together with evidence of fire insurance on the improvements in the amount of the full replacement cost naming Seller as a mortgage loss payee, and a real estate tax service contract (at Buyer's expense), assuring Seller of notice of the status of payment of real property taxes during the life of the Purchase Money Note. (c) The Assignment and Assumption of Lessor's Interest in Lease form specified in paragraph 10.2(c) above, duly executed by Buyer. (d) Assumptions duly executed by Buyer of the obligations of Seller that accrue after Closing under any Other Agreements. (e) If applicable, a written assumption duly executed by Buyer of the loan documents with respect to Existing Notes. (f) If the Buyer is a corporation, a duly executed corporate resolution authorizing the execution of this Agreement and the purchase of the Property. 10.4 At Closing, Escrow Holder shall cause to be issued to Buyer a standard coverage (or ALTA extended, if elected pursuant to 9.1(g)) owner's form policy of title insurance effective as of the Closing, issued by the Title Company in the full amount of the Purchase Price, insuring title to the Property vested in Buyer, subject only to the exceptions approved by Buyer. In the event there is a Purchase Money Deed of Trust in this transaction, the policy of title insurance shall be a joint protection policy insuring both Buyer and Seller. IMPORTANT: IN A PURCHASE OR EXCHANGE OF REAL PROPERTY, IT MAY BE ADVISABLE TO OBTAIN TITLE INSURANCE IN CONNECTION WITH THE CLOSE OF ESCROW SINCE THERE MAY BE PRIOR RECORDED LIENS AND ENCUMBRANCES WHICH AFFECT YOUR INTEREST IN THE PROPERTY BEING ACQUIRED. A NEW POLICY OF TITLE INSURANCE SHOULD BE OBTAINED IN ORDER TO ENSURE YOUR INTEREST IN THE PROPERTY THAT YOU ARE ACQUIRING. 11. Prorations and Adjustments. 11.1 Taxes.Applicable real property taxes and special assessment bonds shall be prorated through Escrow as of the date of the Closing, based upon the latest tax bill available. The Parties agree to prorate as of the Closing any taxes assessed against the Property by supplemental bill levied by reason of events occurring prior to the Closing. Payment of the prorated amount shall be made promptly in cash upon receipt of a copy of any supplemental bill. 11.2 Insurance.WARNING:Any insurance which Seller may have maintained will terminate on the Closing. Buyer is advised to obtain appropriate insurance to cover the Property. 11.3 Rentals, Interest and Expenses.Scheduled rentals, interest on Existing Notes, utilities, and operating expenses shall be prorated as of the date of Closing. The Parties agree to promptly adjust between themselves outside of Escrow any rents received after the Closing. 11.4 Security Deposit.Security Deposits held by Seller shall be given to Buyer as a credit to the cash required of Buyer at the Closing. PAGE 6 OF 11 INITIALS INITIALS © 2019 AIR CRE. All Rights Reserved.OFA-20.20, Revised 11-25-2019 Produced with zipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com 351 N Blackstone DocuSign Envelope ID: 7E1D49B4-3F86-4E92-8E6C-0DCCF8AE21D4 11.5 Post Closing Matters.Any item to be prorated that is not determined or determinable at the Closing shall be promptly adjusted by the Parties by appropriate cash payment outside of the Escrow when the amount due is determined. 11.6 Variations in Existing Note Balances.In the event that Buyer is purchasing the Property subject to an Existing Deed of Trust(s), and in the event that a Beneficiary Statement as to the applicable Existing Note(s) discloses that the unpaid principal balance of such Existing Note(s) at the closing will be more or less than the amount set forth in paragraph 3.1(c) hereof ("Existing Note Variation"), then the Purchase Money Note(s) shall be reduced or increased by an amount equal to such Existing Note Variation. If there is to be no Purchase Money Note, the cash required at the Closing per paragraph 3.1(a) shall be reduced or increased by the amount of such Existing Note Variation. 11.7 Variations in New Loan Balance.In the event Buyer is obtaining a New Loan and the amount ultimately obtained exceeds the amount set forth in paragraph 5.1, then the amount of the Purchase Money Note, if any, shall be reduced by the amount of such excess. 11.8 Owner's Association Fees.Escrow Holder shall: (i) bring Seller's account with the association current and pay any delinquencies or transfer fees from Seller's proceeds, and (ii) pay any up front fees required by the association from Buyer's funds. 12. Representations and Warranties of Seller and Disclaimers. 12.1 Seller's warranties and representations shall survive the Closing and delivery of the deed for a period of 3 years, and any lawsuit or action based upon them must be commenced within such time period. Seller's warranties and representations are true, material and relied upon by Buyer and Brokers in all respects. Seller hereby makes the following warranties and representations to Buyer and Brokers: (a)Authority of Seller.Seller is the owner of the Property and/or has the full right, power and authority to sell, convey and transfer the Property to Buyer as provided herein, and to perform Seller's obligations hereunder. (b)Maintenance During Escrow and Equipment Condition At Closing.Except as otherwise provided in paragraph 9.1(n) hereof, Seller shall maintain the Property until the Closing in its present condition, ordinary wear and tear excepted. (c)Hazardous Substances/Storage Tanks.Seller has no knowledge, except as otherwise disclosed to Buyer in writing, of the existence or prior existence on the Property of any Hazardous Substance, nor of the existence or prior existence of any above or below ground storage tank. (d)Compliance.Except as otherwise disclosed in writing, Seller has no knowledge of any aspect or condition of the Property which violates applicable laws, rules, regulations, codes or covenants, conditions or restrictions, or of improvements or alterations made to the Property without a permit where one was required, or of any unfulfilled order or directive of any applicable governmental agency or casualty insurance company requiring any investigation, remediation, repair, maintenance or improvement be performed on the Property. (e)Changes in Agreements.Prior to the Closing, Seller will not violate or modify any Existing Lease or Other Agreement, or create any new leases or other agreements affecting the Property, without Buyer's written approval, which approval will not be unreasonably withheld. (f)Possessory Rights.Seller has no knowledge that anyone will, at the Closing, have any right to possession of the Property, except as disclosed by this Agreement or otherwise in writing to Buyer. (g)Mechanics' Liens.There are no unsatisfied mechanics' or materialmens' lien rights concerning the Property. (h)Actions, Suits or Proceedings.Seller has no knowledge of any actions, suits or proceedings pending or threatened before any commission, board, bureau, agency, arbitrator, court or tribunal that would affect the Property or the right to occupy or utilize same. (i)Notice of Changes.Seller will promptly notify Buyer and Brokers in writing of any Material Change (see paragraph 9.1(o)) affecting the Property that becomes known to Seller prior to the Closing. (j)No Tenant Bankruptcy Proceedings.Seller has no notice or knowledge that any tenant of the Property is the subject of a bankruptcy or insolvency proceeding. (k)No Seller Bankruptcy Proceedings.Seller is not the subject of a bankruptcy, insolvency or probate proceeding. (l)Personal Property.Seller has no knowledge that anyone will, at the Closing, have any right to possession of any personal property included in the Purchase Price nor knowledge of any liens or encumbrances affecting such personal property, except as disclosed by this Agreement or otherwise in writing to Buyer. 12.2 Buyer hereby acknowledges that, except as otherwise stated in this Agreement, Buyer is purchasing the Property in its existing condition and will, by the time called for herein, make or have waived all inspections of the Property Buyer believes are necessary to protect its own interest in, and its contemplated use of, the Property. The Parties acknowledge that, except as otherwise stated in this Agreement, no representations, inducements, promises, agreements, assurances, oral or written, concerning the Property, or any aspect of the occupational safety and health laws, Hazardous Substance laws, or any other act, ordinance or law, have been made by either Party or Brokers, or relied upon by either Party hereto. 12.3 In the event that Buyer learns that a Seller representation or warranty might be untrue prior to the Closing, and Buyer elects to purchase the Property anyway then, and in that event, Buyer waives any right that it may have to bring an action or proceeding against Seller or Brokers regarding said representation or warranty. 12.4 Any environmental reports, soil reports, surveys, and other similar documents which were prepared by third party consultants and provided to Buyer by Seller or Seller's representatives, have been delivered as an accommodation to Buyer and without any representation or warranty as to the sufficiency, accuracy, completeness, and/or validity of said documents, all of which Buyer relies on at its own risk. Seller believes said documents to be accurate, but Buyer is advised to retain appropriate consultants to review said documents and investigate the Property. 13. Possession. Possession of the Property shall be given to Buyer at the Closing subject to the rights of tenants under Existing Leases. 14. Buyer's Entry. At any time during the Escrow period, Buyer, and its agents and representatives, shall have the right at reasonable times and subject to rights of tenants, to enter upon the Property for the purpose of making inspections and tests specified in this Agreement. No destructive testing shall be conducted, however, without Seller's prior approval which shall not be unreasonably withheld. Following any such entry or work, unless otherwise directed in writing by Seller, Buyer shall return the Property to the condition it was in prior to such entry or work, including the recompaction or removal of any disrupted soil or material as Seller may reasonably direct. All such inspections and tests and any other work conducted or PAGE 7 OF 11 INITIALS INITIALS © 2019 AIR CRE. All Rights Reserved.OFA-20.20, Revised 11-25-2019 Produced with zipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com 351 N Blackstone DocuSign Envelope ID: 7E1D49B4-3F86-4E92-8E6C-0DCCF8AE21D4 materials furnished with respect to the Property by or for Buyer shall be paid for by Buyer as and when due and Buyer shall indemnify, defend, protect and hold harmless Seller and the Property of and from any and all claims, liabilities, losses, expenses (including reasonable attorneys' fees), damages, including those for injury to person or property, arising out of or relating to any such work or materials or the acts or omissions of Buyer, its agents or employees in connection therewith. 15. Further Documents and Assurances. The Parties shall each, diligently and in good faith, undertake all actions and procedures reasonably required to place the Escrow in condition for Closing as and when required by this Agreement. The Parties agree to provide all further information, and to execute and deliver all further documents, reasonably required by Escrow Holder or the Title Company. 16. Attorneys' Fees. If any Party or Broker brings an action or proceeding (including arbitration) involving the Property whether founded in tort, contract or equity, or to declare rights hereunder, the Prevailing Party (as hereafter defined) in any such proceeding, action, or appeal thereon, shall be entitled to reasonable attorneys' fees and costs. Such fees may be awarded in the same suit or recovered in a separate suit, whether or not such action or proceeding is pursued to decision or judgment. The term "Prevailing Party"shall include, without limitation, a Party or Broker who substantially obtains or defeats the relief sought, as the case may be, whether by compromise, settlement, judgment, or the abandonment by the other Party or Broker of its claim or defense. The attorneys' fees award shall not be computed in accordance with any court fee schedule, but shall be such as to fully reimburse all attorneys' fees reasonably incurred. 17. Prior Agreements/Amendments. 17.1 This Agreement supersedes any and all prior agreements between Seller and Buyer regarding the Property. 17.2 Amendments to this Agreement are effective only if made in writing and executed by Buyer and Seller. 18. Broker's Rights. 18.1 If this sale is not consummated due to the default of either the Buyer or Seller, the defaulting Party shall be liable to and shall pay to Brokers the Brokerage Fee that Brokers would have received had the sale been consummated. If Buyer is the defaulting party, payment of said Brokerage Fee is in addition to any obligation with respect to liquidated or other damages. 18.2 Upon the Closing, Brokers are authorized to publicize the facts of this transaction. 19. Notices. 19.1 Whenever any Party, Escrow Holder or Brokers herein shall desire to give or serve any notice, demand, request, approval, disapproval or other communication, each such communication shall be in writing and shall be delivered personally, by messenger or by mail, postage prepaid, to the address set forth in this Agreement or by facsimile transmission, electronic signature, digital signature, or email. 19.2 Service of any such communication shall be deemed made on the date of actual receipt if personally delivered, or transmitted by facsimile transmission, electronic signature, digital signature, or email. Any such communication sent by regular mail shall be deemed given 48 hours after the same is mailed. Communications sent by United States Express Mail or overnight courier that guarantee next day delivery shall be deemed delivered 24 hours after delivery of the same to the Postal Service or courier. If such communication is received on a Saturday, Sunday or legal holiday, it shall be deemed received on the next business day. 19.3 Any Party or Broker hereto may from time to time, by notice in writing, designate a different address to which, or a different person or additional persons to whom, all communications are thereafter to be made. 20. Duration of Offer. 20.1 If this offer is not accepted by Seller on or before 5:00 P.M. according to the time standard applicable to the city of on the date of , it shall be deemed automatically revoked. 20.2 The acceptance of this offer, or of any subsequent counteroffer hereto, that creates an agreement between the Parties as described in paragraph 1.2, shall be deemed made upon delivery to the other Party or either Broker herein of a duly executed writing unconditionally accepting the last outstanding offer or counteroffer. 21. LIQUIDATED DAMAGES.(This Liquidated Damages paragraph is applicable only if initialed by both Parties). THE PARTIES AGREE THAT IT WOULD BE IMPRACTICABLE OR EXTREMELY DIFFICULT TO FIX, PRIOR TO SIGNING THIS AGREEMENT, THE ACTUAL DAMAGES WHICH WOULD BE SUFFERED BY SELLER IF BUYER FAILS TO PERFORM ITS OBLIGATIONS UNDER THIS AGREEMENT. THEREFORE, IF, AFTER THE SATISFACTION OR WAIVER OF ALL CONTINGENCIES PROVIDED FOR THE BUYER'S BENEFIT, BUYER BREACHES THIS AGREEMENT, SELLER SHALL BE ENTITLED TO LIQUIDATED DAMAGES IN THE AMOUNT OF . UPON PAYMENT OF SAID SUM TO SELLER, BUYER SHALL BE RELEASED FROM ANY FURTHER LIABILITY TO SELLER, AND ANY ESCROW CANCELLATION FEES AND TITLE COMPANY CHARGES SHALL BE PAID BY SELLER. Buyer Initials Seller Initials 22. ARBITRATION OF DISPUTES.(This Arbitration of Disputes paragraph is applicable only if initialed by both Parties.) 22.1 ANY CONTROVERSY AS TO WHETHER SELLER IS ENTITLED TO THE LIQUIDATED DAMAGES AND/OR BUYER IS ENTITLED TO THE RETURN OF DEPOSIT MONEY, SHALL BE DETERMINED BY BINDING ARBITRATION BY, AND UNDER THE COMMERCIAL RULES OF THE AMERICAN ARBITRATION ASSOCIATION ("COMMERCIAL RULES"). ARBITRATION HEARINGS SHALL BE HELD IN THE COUNTY WHERE THE PROPERTY IS LOCATED. THE NUMBER OF ARBITRATORS SHALL BE AS PROVIDED IN THE COMMERCIAL RULES AND EACH SUCH ARBITRATOR SHALL BE AN IMPARTIAL REAL ESTATE BROKER WITH AT LEAST 5 YEARS OF FULL TIME EXPERIENCE IN BOTH THE AREA WHERE THE PROPERTY IS LOCATED AND THE TYPE OF REAL ESTATE THAT IS THE SUBJECT OF THIS AGREEMENT. THE ARBITRATOR OR ARBITRATORS SHALL BE APPOINTED UNDER THE COMMERCIAL RULES AND SHALL HEAR AND DETERMINE SAID CONTROVERSY IN ACCORDANCE WITH APPLICABLE LAW, THE INTENTION OF THE PARTIES AS EXPRESSED IN THIS AGREEMENT AND ANY AMENDMENTS THERETO, AND UPON THE EVIDENCE PRODUCED AT AN ARBITRATION PAGE 8 OF 11 INITIALS INITIALS © 2019 AIR CRE. All Rights Reserved.OFA-20.20, Revised 11-25-2019 Produced with zipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com 351 N Blackstone DocuSign Envelope ID: 7E1D49B4-3F86-4E92-8E6C-0DCCF8AE21D4 HEARING. PRE-ARBITRATION DISCOVERY SHALL BE PERMITTED IN ACCORDANCE WITH THE COMMERCIAL RULES OR STATE LAW APPLICABLE TO ARBITRATION PROCEEDINGS. THE AWARD SHALL BE RENDERED WITHIN 30 DAYS AFTER THE CONCLUSION OF THE HEARING, AND MAY INCLUDE ATTORNEYS' FEES AND COSTS TO THE PREVAILING PARTY PER PARAGRAPH 16 HEREOF. JUDGMENT MAY BE ENTERED ON THE AWARD IN ANY COURT OF COMPETENT JURISDICTION NOTWITHSTANDING THE FAILURE OF A PARTY DULY NOTIFIED OF THE ARBITRATION HEARING TO APPEAR THEREAT. 22.2 BUYER'S RESORT TO OR PARTICIPATION IN SUCH ARBITRATION PROCEEDINGS SHALL NOT BAR SUIT IN A COURT OF COMPETENT JURISDICTION BY THE BUYER FOR DAMAGES AND/OR SPECIFIC PERFORMANCE UNLESS AND UNTIL THE ARBITRATION RESULTS IN AN AWARD TO THE SELLER OF LIQUIDATED DAMAGES, IN WHICH EVENT SUCH AWARD SHALL ACT AS A BAR AGAINST ANY ACTION BY BUYER FOR DAMAGES AND/OR SPECIFIC PERFORMANCE. 22.3 NOTICE: BY INITIALING IN THE SPACE BELOW YOU ARE AGREEING TO HAVE ANY DISPUTE ARISING OUT OF THE MATTERS INCLUDED IN THE "ARBITRATION OF DISPUTES" PROVISION DECIDED BY NEUTRAL ARBITRATION AS PROVIDED BY CALIFORNIA LAW AND YOU ARE GIVING UP ANY RIGHTS YOU MIGHT POSSESS TO HAVE THE DISPUTE LITIGATED IN A COURT OR JURY TRIAL. BY INITIALING IN THE SPACE BELOW YOU ARE GIVING UP YOUR JUDICIAL RIGHTS TO DISCOVERY AND APPEAL, UNLESS SUCH RIGHTS ARE SPECIFICALLY INCLUDED IN THE "ARBITRATION OF DISPUTES" PROVISION. IF YOU REFUSE TO SUBMIT TO ARBITRATION AFTER AGREEING TO THIS PROVISION, YOU MAY BE COMPELLED TO ARBITRATE UNDER THE AUTHORITY OF THE CALIFORNIA CODE OF CIVIL PROCEDURE. YOUR AGREEMENT TO THIS ARBITRATION PROVISION IS VOLUNTARY. WE HAVE READ AND UNDERSTAND THE FOREGOING AND AGREE TO SUBMIT DISPUTES ARISING OUT OF THE MATTERS INCLUDED IN THE "ARBITRATION OF DISPUTES" PROVISION TO NEUTRAL ARBITRATION. Buyer Initials Seller Initials 23. Miscellaneous. 23.1 Binding Effect.This Agreement shall be binding on the Parties without regard to whether or not paragraphs 21 and 22 are initialed by both of the Parties. Paragraphs 21 and 22 are each incorporated into this Agreement only if initialed by both Parties at the time that the Agreement is executed. Signatures to this Agreement accomplished by means of electronic signature or similar technology shall be legal and binding. 23.2 Applicable Law.This Agreement shall be governed by, and paragraph 22.3 is amended to refer to, the laws of the state in which the Property is located. Any litigation or arbitration between the Parties hereto concerning this Agreement shall be initiated in the county in which the Property is located. 23.3 Time of Essence.Time is of the essence of this Agreement. 23.4 Counterparts.This Agreement may be executed by Buyer and Seller in counterparts, each of which shall be deemed an original, and all of which together shall constitute one and the same instrument. Escrow Holder, after verifying that the counterparts are identical except for the signatures, is authorized and instructed to combine the signed signature pages on one of the counterparts, which shall then constitute the Agreement. 23.5 Waiver of Jury Trial. THE PARTIES HEREBY WAIVE THEIR RESPECTIVE RIGHTS TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING INVOLVING THE PROPERTY OR ARISING OUT OF THIS AGREEMENT. 23.6 Conflict.Any conflict between the printed provisions of this Agreement and the typewritten or handwritten provisions shall be controlled by the typewritten or handwritten provisions.Seller and Buyer must initial any and all handwritten provisions. 23.7 1031 Exchange.Both Seller and Buyer agree to cooperate with each other in the event that either or both wish to participate in a 1031 exchange. Any party initiating an exchange shall bear all costs of such exchange. The cooperating Party shall not have any liability (special or otherwise) for damages to the exchanging Party in the event that the sale is delayed and/or that the sale otherwise fails to qualify as a 1031 exchange. 23.8 Days.Unless otherwise specifically indicated to the contrary, the word "days" as used in this Agreement shall mean and refer to calendar days. 24. Disclosures Regarding The Nature of a Real Estate Agency Relationship. 24.1 The Parties and Brokers agree that their relationship(s) shall be governed by the principles set forth in the applicable sections of the California Civil Code, as summarized in paragraph 24.2. 24.2 When entering into a discussion with a real estate agent regarding a real estate transaction, a Buyer or Seller should from the outset understand what type of agency relationship or representation it has with the agent or agents in the transaction. Buyer and Seller acknowledge being advised by the Brokers in this transaction, as follows: (a)Seller's Agent.A Seller's agent under a listing agreement with the Seller acts as the agent for the Seller only. A Seller's agent or subagent has the following affirmative obligations: (1)To the Seller:A fiduciary duty of utmost care, integrity, honesty, and loyalty in dealings with the Seller. (2)To the Buyer and the Seller:a. Diligent exercise of reasonable skills and care in performance of the agent's duties. b. A duty of honest and fair dealing and good faith. c. A duty to disclose all facts known to the agent materially affecting the value or desirability of the property that are not known to, or within the diligent attention and observation of, the Parties. An agent is not obligated to reveal to either Party any confidential information obtained from the other Party which does not involve the affirmative duties set forth above. (b)Buyer's Agent.A selling agent can, with a Buyer's consent, agree to act as agent for the Buyer only. In these situations, the agent is not the Seller's agent, even if by agreement the agent may receive compensation for services rendered, either in full or in part from the Seller. An agent acting only for a Buyer has the following affirmative obligations. (1)To the Buyer:A fiduciary duty of utmost care, integrity, honesty, and loyalty in dealings with the Buyer. (2)To the Buyer and the Seller:a. Diligent exercise of reasonable skills and care in performance of the agent's duties. b. A duty of honest and fair dealing and good faith. c. A duty to disclose all facts known to the agent materially affecting the value or desirability of the property that are not known to, or within the diligent attention and observation of, the Parties. An agent is not obligated to reveal to either Party any confidential information obtained from the other Party which does not involve the affirmative duties set forth above. (c)Agent Representing Both Seller and Buyer.A real estate agent, either acting directly or through one or more associate licenses, can legally be the agent of both the Seller and the Buyer in a transaction, but only with the knowledge and consent of both the Seller and the PAGE 9 OF 11 INITIALS INITIALS © 2019 AIR CRE. All Rights Reserved.OFA-20.20, Revised 11-25-2019 Produced with zipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com 351 N Blackstone DocuSign Envelope ID: 7E1D49B4-3F86-4E92-8E6C-0DCCF8AE21D4 Buyer. (1) In a dual agency situation, the agent has the following affirmative obligations to both the Seller and the Buyer: a. A fiduciary duty of utmost care, integrity, honesty and loyalty in the dealings with either Seller or the Buyer. b. Other duties to the Seller and the Buyer as stated above in their respective sections (a) or (b) of this paragraph 24.2. (2) In representing both Seller and Buyer, the agent may, not without the express permission of the respective Party, disclose to the other Party confidential information, including, but not limited to, facts relating to either Buyer's or Seller's financial position, motivations, bargaining position, or other personal information that may impact price, including Seller's willingness to accept a price less than the listing price or Buyer's willingness to pay a price greater than the price offered. (3) The above duties of the agent in a real estate transaction do not relieve a Seller or Buyer from the responsibility to protect their own interests. Buyer and Seller should carefully read all agreements to assure that they adequately express their understanding of the transaction. A real estate agent is a person qualified to advise about real estate. If legal advice is desired, consult a competent professional. Buyer has the duty to exercise reasonably care to protect Buyer, including as to those facts about the Property which are known to Buyer or within Buyer's diligent attention and observation. Both Seller and Buyer should strongly consider obtaining tax advice from a competent professional because the federal and state tax consequences of a transaction can be complex and subject to change. (d)Further Disclosures.Throughout this transaction Buyer and Seller may receive more than one disclosure, depending upon the number of agents assisting in the transaction. Buyer and Seller should each read its contents each time it is presented, considering the relationship between them and the real estate agent in this transaction and that disclosure. Buyer and Seller each acknowledge receipt of a disclosure of the possibility of multiple representation by the Broker representing that principal. This disclosure may be part of a listing agreement, buyer representation agreement or separate document. Buyer understands that Broker representing Buyer may also represent other potential buyers, who may consider, make offers on or ultimately acquire the Property. Seller understands that Broker representing Seller may also represent other sellers with competing properties that may be of interest to this Buyer. Brokers have no responsibility with respect to any default or breach hereof by either Party. The Parties agree that no lawsuit or other legal proceeding involving any breach of duty, error or omission relating to this transaction may be brought against Broker more than one year after the Date of Agreement and that the liability (including court costs and attorneys' fees), of any Broker with respect to any breach of duty, error or omission relating to this Agreement shall not exceed the fee received by such Broker pursuant to this Agreement; provided, however, that the foregoing limitation on each Broker's liability shall not be applicable to any gross negligence or willful misconduct of such Broker. 24.3 Confidential Information:Buyer and Seller agree to identify to Brokers as "Confidential" any communication or information given Brokers that is considered by such Party to be confidential. 25. Construction of Agreement.In construing this Agreement, all headings and titles are for the convenience of the Parties only and shall not be considered a part of this Agreement. Whenever required by the context, the singular shall include the plural and vice versa. This Agreement shall not be construed as if prepared by one of the Parties, but rather according to its fair meaning as a whole, as if both Parties had prepared it. 26. Additional Provisions: Additional provisions of this offer, if any, are as follows or are attached hereto by an addendum or addenda consisting of paragraphs through . (If there are no additional provisions write "NONE".) ATTENTION: NO REPRESENTATION OR RECOMMENDATION IS MADE BY THE AIR CRE OR BY ANY BROKER AS TO THE LEGAL SUFFICIENCY, LEGAL EFFECT, OR TAX CONSEQUENCES OF THIS AGREEMENT OR THE TRANSACTION TO WHICH IT RELATES. THE PARTIES ARE URGED TO: 1. SEEK ADVICE OF COUNSEL AS TO THE LEGAL AND TAX CONSEQUENCES OF THIS AGREEMENT. 2. RETAIN APPROPRIATE CONSULTANTS TO REVIEW AND INVESTIGATE THE CONDITION OF THE PROPERTY. SAID INVESTIGATION SHOULD INCLUDE BUT NOT BE LIMITED TO: THE POSSIBLE PRESENCE OF HAZARDOUS SUBSTANCES, THE ZONING OF THE PROPERTY, THE INTEGRITY AND CONDITION OF ANY STRUCTURES AND OPERATING SYSTEMS, AND THE SUITABILITY OF THE PROPERTY FOR BUYER'S INTENDED USE. WARNING: IF THE PROPERTY IS LOCATED IN A STATE OTHER THAN CALIFORNIA, CERTAIN PROVISIONS OF THIS AGREEMENT MAY NEED TO BE REVISED TO COMPLY WITH THE LAWS OF THE STATE IN WHICH THE PROPERTY IS LOCATED. NOTE: 1. THIS FORM IS NOT FOR USE IN CONNECTION WITH THE SALE OF RESIDENTIAL PROPERTY. 2. IF EITHER PARTY IS A CORPORATION, IT IS RECOMMENDED THAT THIS AGREEMENT BE SIGNED BY TWO CORPORATE OFFICERS. PAGE 10 OF 11 INITIALS INITIALS © 2019 AIR CRE. All Rights Reserved.OFA-20.20, Revised 11-25-2019 Produced with zipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com 351 N Blackstone DocuSign Envelope ID: 7E1D49B4-3F86-4E92-8E6C-0DCCF8AE21D4 The undersigned Buyer offers and agrees to buy the Property on the terms and conditions stated and acknowledges receipt of a copy hereof. Date: BROKER BUYER Att:By: Name Printed:Title: Address:Title: Phone: Phone:Fax: Fax:Email: Email: By:Federal ID No.: Name Printed:Broker DRE License #: Title:Agent DRE License #: Phone: Fax: Email: Address: Federal ID No.: Acceptance.27. Seller accepts the foregoing offer to purchase the Property and hereby agrees to sell the Property to Buyer on the terms and27.1 conditions therein specified. 27.2 In consideration of real estate brokerage service rendered by Brokers, Seller agrees to pay Brokers a real estate Brokerage Fee in a sum equal to % of the Purchase Price to be divided between the Brokers as follows: Seller’s Broker % and Buyer’s Broker %. This Agreement shall serve as an irrevocable instruction to Escrow Holder to pay such Brokerage Fee to Brokers out of the proceeds accruing to the account of Seller at the Closing. 27.3 Seller acknowledges receipt of a copy hereof and authorizes Brokers to deliver a signed copy to Buyer. NOTE: A PROPERTY INFORMATION SHEET IS REQUIRED TO BE DELIVERED TO BUYER BY SELLER UNDER THIS AGREEMENT. Date: SELLERBROKER Att:By: Title:Name Printed: Address:Title: Phone: Phone:Fax: Fax:Email: Email: Federal ID No.:By: Broker DRE License #:Name Printed: Agent DRE License #:Title: Phone: Fax: Email: Address: Federal ID No.: AIR CRE * https://www.aircre.com * 213-687-8777 * contracts@aircre.com NOTICE: No part of the works may be reproduced in any form without permission in writing. PAGE 11 OF 11INITIALS INITIALS © 2019 AIR CRE. All Rights Reserved.OFA-20.20, Revised 11-25-2019 Produced with zipForm® by zipLogix 18070 Fifteen Mile Road, Fraser, Michigan 48026 www.zipLogix.com Lee & Associates Alex Peck apeck@lee-associates.com 02090388 01981426 STACHS, LLC 6.000 3.000 3.000 KW Commercial Jared Ennis & Kevin Land 740 W Alluvial Ave #102, Fresno,CA 93711 400 E. Main St., Suite 110, Visalia, CA Kevin@ / Jared@CentralCaCommercial.com Michael A Richards Michael A Richards 351 N Blackstone DocuSign Envelope ID: 7E1D49B4-3F86-4E92-8E6C-0DCCF8AE21D4 To whom it may concern, I Veronica Gonzaga moved back to California in November 2014. I was homeless and sleeping place to place until I moved into an apartment with section 8 in March 2015. I moved into a unit at located at . I live there until I moved into the unit at . Veronica Gonzaga PLANNING AND DEVELOPMENT DEPARTMENT 2600 Fresno Street • Third Floor Jennifer K. Clark, AICP, Director Fresno, California 93721-3604 (559) 621-8277 FAX (559) 498-1026 January 26, 2021 Please reply to: Marisela Martínez (559) 621-8038 Veronica Gonzaga Boogy Baybee LLC Dear Applicant: SUBJECT: ZONING INQUIRY NUMBER P21-00335 REQUESTING INFORMATION REGARDING CANNABIS RETAIL FOR PROPERTY LOCATED AT 351 NORTH BLACKSTONE AVENUE (APN 459-153-05) Thank you for your inquiry regarding the allowance of new cannabis retail uses. The requested information about cannabis retail uses was analyzed using Article 27, Chapter 15 of the Fresno Municipal Code (FMC) of the City of Fresno. Please note, all research for this inquiry is based on existing land development of the subject property. If there are multiple buildings on the subject property, this research was based on the address provided in the request. This research does not take into effect of future development unless provided in your application request. With that, research of a proposed cannabis retail business on the subject property conveys the following: 1. All cannabis retail businesses must be located on property zoned DTN (Downtown Neighborhood), DTG (Downtown General), CMS (Commercial Main Street), CC (Commercial Community), CR (Commercial Regional), CG (Commercial General), CH (Commercial Highway), NMX (Neighborhood Mixed-Use), CMX (Corridor/Center Mixed- Use), RMX (Regional Mixed-Use), and must meet all of the requirements for development in these zones, including, but not limited to, parking, lighting, building materials, etc. The subject property is zoned CMX, which is one of the allowable zone districts for cannabis retail businesses. Development standards of the CMX zone district are available in Sections 15-1103, 15-1104, and 15-1105 of the FMC. The subject location meets the zone district requirement, per Section 15-2739.B.1.a of the FMC, for a cannabis retail business. 2. All building(s) in which a cannabis retail business is located shall be no closer than 800 feet from any property boundary containing the following: (1) A cannabis retail business; (2) A school providing instruction for any grades pre-school through 12 (whether public, private, or charter, including pre-school, transitional kindergarten, and K-12); (3) A day care center licensed by the state Department of Social Services that is in existence at the time a complete commercial cannabis business permit application is submitted; and, (4) A youth center that is in existence at the time a complete commercial cannabis business permit is submitted. Zoning Inquiry P21-00335 351 North Blackstone Avenue Page 2 January 26, 2021 The subject property is not located within 800 feet of the property boundary of any of the above-mentioned uses. The subject building meets the separation requirements, per Section 15-2739.B.1.b of the FMC, for a cannabis retail business. 3. Prior to commencing operations, a cannabis retail business must obtain a Cannabis Conditional Use Permit from the Planning and Development Department per Section 15- 2739.N of the FMC. 4. No more than two cannabis retail businesses may be located in any one Council District. If more than 14 are ever authorized by Council (more than two per Council District), they shall be dispersed evenly by Council District. The subject property is in Council District 3. There are currently no cannabis retail businesses located in Council District 3. This location requirement is satisfied for a cannabis retail business. Please review the entirety of Article 33, Chapter 9 (Cannabis Retail Business and Commercial Cannabis), and Section 15-2739 (Adult Use and Medicinal Cannabis Retail Business and Commercial Cannabis Business) of the FMC to understand other requirements of cannabis retail businesses, including but not limited to, application requirements, signage, etc. This information was researched by the undersigned per the zoning request. The undersigned certifies that the above information contained herein is believed to be accurate and is based upon, or relates to, the information supplied by the requestor. The City of Fresno assumes no liability for errors and omissions. All information was obtained from public records held by the Planning and Development Department. A copy of the Fresno Municipal Code may be obtained by contacting the City Clerk’s office at 559-621-7650. The Fresno Municipal Code may also be searched on the Internet, free of charge, by going to www.fresno.gov. If you have questions regarding this matter, please contact me by telephone at 559-621-8038 or at Marisela.Martinez@fresno.gov. Cordially, Marisela Martinez, Planner II Development Services Division Planning and Development Department Confidential Stachs – Boogy Baybee Term Sheet for Proposed Management Agreement January 27, 2021 This Term Sheet (the “Term Sheet”) summarizes the principal terms of a proposed relationship by and between Boogy Baybee LLC (“Company”), and Stachs LLC (“Stachs”) (Company and Stachs may hereinafter be referred to as a “Party” or collectively as the “Parties”). Except as otherwise explicitly set forth below, no legally binding obligations shall be created until definitive agreements are executed and delivered by both Parties. This Term Sheet shall be governed in all respects by the laws of the State of California. Contract Provision Description Proposed Relationship: On the terms set forth in this Term Sheet, as shall be further detailed in a definitive agreement (the “Management Agreement”), the Parties wish to enter into a commercial relationship pursuant to which Company’s depot (and/or retail store) that offers, or will offer, for sale: legal cannabis, cannabis products, cannabis-related products, and cannabis accessories (such location the “Depot” and such products, “Cannabis Products”) shall engage Stachs to, and elect to grant Stachs all necessary authority to, on Company’s behalf, carry out all aspects of Depot operations which relate to the fulfillment and delivery of orders placed through the Stachs affiliate platform (such business, the “Delivery Business” and such platform, the “App”), including: (i) buying of Cannabis Products inventory intended for retail via the App (the “Delivery Business Products”), (ii) retailing such Delivery Business Products via the delivery business, (iii) management of the Depot premises which are utilized for Delivery Business Products storage and retail, (iv) the hiring, termination, employment and management of a team of certain Company employees located at, or delivering from, the Depot(s) who directly facilitate the sale of the Delivery Business Products (such employees the “Dedicated Employees”). Pursuant to the Management Agreement, Company shall authorize Stachs to carry out all employment related functions regarding the Dedicated Employees; (v) Establish a bank account for the receipt of Delivery Business revenue, which account shall be either an account held in Stachs’ name, or alternatively, an account held in Company’s name that Stachs has all authority necessary to operate the Delivery Business, including the distribution of Delivery Business revenue to Stachs and payment of expenses attributable to Stachs. (vi) Develop, in collaboration with Company, a comprehensive security plan for the entire licensed premises, and to thereafter oversee Depot security; (vii) Engage third party vendors in connection with the Delivery Business; (viii) Assist the Company in taking reasonable action in order to preserve the validity of all applicable cannabis licenses. Management Fee: Each calendar month during the Term, the Company shall be entitled to the cash payments in accordance with, and on the schedule, set forth on Schedule A attached hereto (such cash payment amounts, the “Company Funds”). The Company Funds shall either be:  Paid to the Company from a bank account held in Stachs’ name (a “Stachs Direct Account”) if the Delivery Business revenue is paid directly to a Stachs Direct Account; or  Retained by the Company if the Delivery Business revenue is paid dire ctly into a bank account held in the Company’s name. The Parties expect and prefer that, initially, the Delivery Business revenue shall be paid DocuSign Envelope ID: A2FF2008-0E60-4CB1-8227-B1B1682B082E Confidential into a Stachs Direct Account and the Company Funds shall be paid to the Company from a Stachs Direct Account. If Delivery Business revenue is received by a bank account that is held in the Company’s name, then:  Stachs shall (on a monthly basis) invoice the Company for the applicable management services provided, and the products sold during such invoice period.  The Company Funds shall on a monthly basis also include an additional amount, deducted from the Stachs invoice amount, that is equal to the amount of city and sales taxes applicable to the gross merchandise value of Delivery Business Products (as defined below). For avoidance of doubt, Stachs’ foregoing obligation to remit the Company funds to the Company and the Company’s right to retain the Company Funds is contingent upon the receipt of Delivery Business revenue; and, as consideration for the services provided by Stachs, Stachs shall be entitled to the Delivery Business revenue other than the Company Funds. Company shall be afforded customary audit rights with regard to the operation of the Delivery Business. Assumed Company Expenses: Subject to the Company’s receipt of the Fresno Commercial Cannabis Permit and conditional use permit for the Depot location from the City of Fresno (“Local Approval”), Stachs shall agree to advance to the Company sums as needed, up to for ordinary course Depot related or Company business related expenses incurred by the Company in connection with the Company’s build out, operationalization and launch of the Depot / retail business (such expenses, the “Advanced Costs”). All Advanced Costs shall be supported by reasonable documentation, including without limitation, all bids, estimates, invoices and recipients for payments and shall provide all reasonable information or documentation as may be requested by Stachs, including KYC or related banking regulatory information and documentation (in the event any payments are made directly by Stachs to the recipient). Post- License Process Completion Expenses: Prior to Local Approval and state licensure, Stachs shall be responsible for rent and related property holding costs (e.g., basic utilities) and costs associated with obtaining the Local Approval and state license. After License Process Completion, Stachs shall be responsible for the costs directly arising out of the: (i) employment of the Dedicated Employees, (and to the extent any such costs are shared with other Company employees, then Stachs’ portion shall be on a pro rata basis), (ii) inventory costs of Delivery Business Products, (iii) incremental licensing fees, (iv) insurance to the extent required by the operation of the Delivery Business as well as a proportionate share of any insurance costs for policies covering the premises and business operations that cannot otherwise be underwritten separately amongst the Parties, (v) bank fees for the operation of the applicable Delivery Business revenue bank account; (vi) incremental tenant improvements or security costs directly arising from the Delive ry Business and 50% of costs associated with ongoing security costs and security personnel; (vii) costs associated with certificate of occupancy permit application; (viii) a proportion of rents and utility costs attributable to Depot Space. For avoidance of doubt, except for foregoing expenses and the Advanced Costs, Stachs shall have no responsibility for any other expenses related to the operation of any Depot(s). Company shall provide Stachs with invoices for any costs which are the responsibility of Stachs on a monthly basis. Responsibilities: The Parties agree that: (a) Pursuant to the Management Agreement, the Company will engage Stachs to (and grant Stachs requisite authority to): (i) direct Company with respect to all employment related decisions (e.g., hiring, firing, hours, roles, responsibilities, etc..) for all Dedicated Employees; and (ii) direct Company with respect to the ordering of all DocuSign Envelope ID: A2FF2008-0E60-4CB1-8227-B1B1682B082E Confidential Delivery Business Products. (b) Stachs shall be entitled to make, in its sole and absolute discretion, all decisions regarding the App “menu” including the menus that are serviced in whole or in part by a Depot(s) and all Cannabis Products that appear thereon. (c) Company will assist Stachs in the performance of its duties by providing sufficient operational space and non-Dedicated Employee resources at the Depot(s) for Stachs to reasonably achieve sales and delivery goals. (d) the Dedicated Employees shall (i) be employees of Company, (ii) only provide services in accordance with the terms of the Management Agreement for purposes of carrying out Delivery Business related operational functions and for purposes of processing and completing orders for Delivery Business Products placed through the App. Additionally, the Company agrees to use its best efforts to avail itself of all applicable licensing and processing fee subsidies and incentives offered by the city of Fresno and any other applicable governmental body. Company further agrees to take all ac tions reasonably necessary to preserve the good standing and status of the licenses with all applicable authorities. Term and Termination: Term: The Parties intend for the Management Agreement to have a term of fifteen years (“Initial Term”); provided, however, that at the end of the Initial Term, the Management Agreement shall automatically renew for successive one-year periods unless either party provides notice of termination to the other Party no less than ninety (90) days prior to the end of the then current term (the Initial Term, plus any extension thereof, the “Term”). Termination: By Stachs – Stachs may immediately terminate the Management Agreement, if (i) the Company has not received Local Approval by February 28th, 2022 (and, for avoidance of doubt, Stachs’ shall have no obligation to further advance any of the Advanced Costs); and (ii) after Local Approval, Stachs may terminate the Management Agreement upon notice to Company; provided, that unless Stachs has terminated due to Company’s material breach, Stachs’ obligation to bear up to of Advanced Costs shall survive. Stachs may also terminate for reasons typical for a commercial relationship of this kind, including for Company’s material breach. By Company - The Company may only termination the Management Agreement if (i) required to comply with applicable law (and in which case, the Company shall work with Stachs to address any such requirement prior to effecting any such termination); or (ii) if Stachs fails to pay the Company Funds or fails to pay the Stachs Assumed Expenses, in each case, subject to a reasonable cure period of no less than thirty days. For avoidance of doubt, in the event that Company terminates the Management Agreement in order to comply with applicable law, then Stachs’ obligation to continue advancing funds to the Company for the Advanced Costs shall be of no further force or effect. Right of First Refusal: The Company will grant to Stachs a right of first refusal (the “ROFR”) over any third-party transactions that would constitute a change of control of the Company (whether a sale of equity, by merger or otherwise) or any sale of a material portion of the assets of the Company (each a “ROFR Transaction” and such offering third party, the “Offering Party”). Without limiting the foregoing, the ROFR shall provide that if (i) the Company’s management or board of directors decides to begin or explore a sale process or (ii) the Company receives (whether in writing or verbal) any genuine expression of interest from an Offering Party with respect to a ROFR Transaction, then the Company will within ten business days, notify Stachs of such proposed ROFR Transaction, including providing all material terms included in such proposed transaction. DocuSign Envelope ID: A2FF2008-0E60-4CB1-8227-B1B1682B082E Confidential Stachs shall have thirty (30) days from receipt of such notice to match (or improve) the material terms of the offer (such 30-day period, the “ROFR Period”) and in the event that Stachs matches (or improves), the Company shall immediately discontinue any discussions with the Offering Party and shall consummate the proposed transaction with Stachs (subject to receipt of customary applicable approvals). For avoidance of doubt, Stachs and the Company agree that Stachs’ response to an Offering Party’s Proposed Transaction shall not be deemed to be on less favorable terms if Stachs proposes to effect an acquisition of the Company pursuant to a structure different from that proposed by the Offering Party, including, without limitation by statutory merger (whether by Stachs or a direct or indirect subsidiary of Stachs). Additionally, in the event that Stachs does not respond within the ROFR Period, or if Stachs expressly declines to consummate the ROFR Transaction on substantially the same or better terms, then the Company shall be permitted to proceed with the negotiation of the ROFR Transaction with the Offering Party. Provided, that the Company agrees to promptly notify any Offering Party of the existence of the ROFR but shall not identify Stachs as the applicable party holding the ROFR. For avoidance of doubt, the Parties agree that in the event of any insolvency of the Company (whether voluntary or involuntary and including if a receiver is appointed to administer the Company) Stachs shall be deemed to have immediately exercised the ROFR; provided, that Stachs may, at Stachs sole discretion, immediately terminate any such ROFR Transaction at any point after such automatic effectuation of the ROFR. Additionally, the Company agrees that during the Te rm the Company shall not issue equity interests to any third parties (i.e., parties other than the equity holders of the Company as of the effective date of the Management Agreement) that in aggregate constitute greater than 10% of the voting equity of the Company. Depot Space: The Company shall reserve adequate space for the operation of the Delivery Business, including no less than 1,300 square feet of warehouse space and approximately 5 parking spaces shall be reserved for Dedicated Employee driver use (provided, Company shall be permitted to use the parking area for receiving products). Reserved square footage for the Delivery Business will be contiguous, be air-conditioned, and will allow direct access to ingress/egress and bathrooms. License Application Process: The Parties agree that each of the Parties will endeavor to complete certain processes related to the inclusion of Stachs as an “Owner” in the initial license applications (the “License Process”). The Parties expect that the License Process will include the filing of a local authorization application for retail delivery with the city of Fresno and either an annual cannabis retailer license application or a business modification application (whic h application shall include all applicable requested supporting documentation) by Company with the City of Fresno, County of Fresno, Bureau of Cannabis Control, and/or other regulating agencies with relevant jurisdiction (the “License Filing”). The License Process will be deemed to be complete upon: (i) the approval of Stachs’ inclusion as an Owner or of the business modification application at both the Bureau of Cannabis Control and all applicable local levels, and (ii) the Company’s receipt of a local operating permit from the City of Fresno as well as an Annual License from the State of California (receipt of all such approvals, “License Process Completion”). For avoidance of doubt, inclusion of Stachs as an “Owner” on the Company’s license is not intended to and shall not confer on Stachs any right as an equity holder of the Company in any capacity. Stachs shall pay the reasonable fees and expenses related to the initial preparation and filing of the filings related to the License Process, License Filing and related to any subsequent responses to applicable regulatory agencies. DocuSign Envelope ID: A2FF2008-0E60-4CB1-8227-B1B1682B082E Confidential SCHEDULE A Months During the Term Cash Distribution Months. 1 - 12 Months. 13 - 24 Months. 25 - 36 Months. 37 - 48 Months. 49 - 60 Months. 61 - 120 Months. 121+ DocuSign Envelope ID: A2FF2008-0E60-4CB1-8227-B1B1682B082E Confidential AGREED BY THE PARTIES AS OF JANUARY 27, 2021: Boogy Baybee LLC Signature: _____________________________ Name:_________________________________ Title:__________________________________ Date:__________________________________ STACHS LLC Signature: _____________________________ Name:_________________________________ Title:__________________________________ Date:__________________________________ DocuSign Envelope ID: A2FF2008-0E60-4CB1-8227-B1B1682B082E 1/27/2021 | 4:29 PM PST Tony Kim Chief Executive Officer Veronica Gonzaga OWNER 1/27/2021 | 6:39 PM EST