LEASE

Exhibit 10.1

10/31/01 MTIN
CALWEST TX FORM 7/03

LEASE

and

ADAMS GOLF, INC.,
Tenant

10/31/01 CALWEST TX MTIN
REVISED 7/15/02
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DA-230221 v6 1202810-00004

TABLE OF CONTENTS

		Page
1. USE AND RESTRICTIONS ON USE .			1
2. TERM .			2
3. RENT .			2
4. RENT ADJUSTMENTS .			2
5. SECURITY DEPOSIT			5
6. ALTERATIONS .			5
7. REPAIR .			5
8. LIENS			6
9. ASSIGNMENT AND SUBLETTING .			7
10. INDEMNIFICATION			8
11. INSURANCE .			9
12. WAIVER OF SUBROGATION			10
13. SERVICES AND UTILITIES			10
14. HOLDING OVER			10
15. SUBORDINATION			10
16. RULES AND REGULATIONS			11
17. REENTRY BY LANDLORD .			11
18. DEFAULT .			11
19. REMEDIES .			12
20. TENANT’S BANKRUPTCY OR INSOLVENCY .			15
21. QUIET ENJOYMENT			15
22. CASUALTY .			15
23. EMINENT DOMAIN			16
24. SALE BY LANDLORD			17
25. ESTOPPEL CERTIFICATES			17
26. SURRENDER OF PREMISES .			17
27. NOTICES			18
28. TAXES PAYABLE BY TENANT			18
29. RELOCATION OF TENANT			18
30. DEFINED TERMS AND HEADINGS			18
31. TENANT’S AUTHORITY			18
32. FINANCIAL STATEMENTS AND CREDIT REPORTS			19
33. COMMISSIONS			19
34. TIME AND APPLICABLE LAW			19
35. SUCCESSORS AND ASSIGNS			19
36. ENTIRE AGREEMENT			19
37. EXAMINATION NOT OPTION			19
38. RECORDATION			19
39. FORCE MAJEURE			19
40. SEVERABILITY			20
41. COUNTERPARTS			20
42. LIMITATION OF LANDLORD’S LIABILITY			20

EXHIBIT A – FLOOR PLAN DEPICTING THE PREMISES
EXHIBIT A-1 – SITE PLAN
EXHIBIT B – INITIAL ALTERATIONS
EXHIBIT C – COMMENCEMENT DATE MEMORANDUM
EXHIBIT D – RULES AND REGULATIONS
EXHIBIT E – ADDITIONAL SURRENDER CONDITIONS
EXHIBIT F – APPROVAL OF ALTERATIONS, ADDITIONS AND IMPROVEMENTS

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DA-230221 v6 1202810-00004

MULTI-TENANT INDUSTRIAL NET LEASE

REFERENCE PAGES

BUILDING:		2801 East Plano Parkway Plano, Texas 75074
LANDLORD:		CLP Properties Texas, L.P., a Delaware limited partnership
LANDLORD’S ADDRESS:		c/o RREEF Management Company 1406 Halsey Way, Suite 110 Carrollton, Texas 75007
WIRE INSTRUCTIONS AND/OR ADDRESS FOR RENT PAYMENT:		CLP Properties Texas, L.P. 75 Remittance Drive, Suite 96266 Chicago, Illinois 60675-6265
LEASE REFERENCE DATE:		January 31, 2008
TENANT:		Adams Golf, Inc., a Texas corporation
TENANT’S NOTICE ADDRESS:		2801 East Plano Parkway Plano, Texas 75074
PREMISES ADDRESS:		2801 East Plano Parkway Plano, Texas 75074
PREMISES RENTABLE AREA:		Approximately 65,135 sq. ft. (for outline of Premises see Exhibit A )
USE:		Assembly and distribution of golf equipment and merchandise, and general office use.
COMMENCEMENT DATE:		September 1, 2008.
TERM OF LEASE:		Approximately five (5) years, zero (0) months and zero (0) days beginning on the Commencement Date and ending on the Termination Date.
TERMINATION DATE:		August 31, 2013.

ANNUAL RENT and MONTHLY INSTALLMENT OF RENT ( Article 3 ):

Period				Rentable Square				Annual Rent Per								Monthly Installment
from		through		Footage				Square Foot				Annual Rent				of Rent
9/1/2008		8/31/2010			65,135			$	6.20			$	403,837.00			$	33,653.08
9/1/2010		8/31/2013			65,135			$	6.60			$	429,891.00			$	35,824.25

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				Initial Here

INITIAL ESTIMATED MONTHLY INSTALLMENT OF RENT ADJUSTMENTS ( Article 4 ):		$11,887.14
TENANT’S PROPORTIONATE SHARE:		100%
SECURITY DEPOSIT:		None
ASSIGNMENT/SUBLETTING FEE:		None
REAL ESTATE BROKER DUE COMMISSION:		Cressa Partners
TENANT’S SIC CODE:		3949
AMORTIZATION RATE:		10%

The Reference Pages information is incorporated into and made a part of the Lease. In the event of any conflict between any Reference Pages information and the Lease, the Lease shall control. This Lease includes Exhibits A through E , all of which are made a part of this Lease.

LANDLORD:

TENANT:

CLP PROPERTIES TEXAS, L.P. , a

ADAMS GOLF, INC. , a Texas corporation

Delaware limited partnership

By:

RREEF Management Company, a Delaware

By:

corporation, its Authorized Agent

Name:

Title:

By:

Dated:

, 2008

Name: Cynthia Prendergast

Title: District Manager

Dated:                                           , 2008

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Signature Page

LEASE

     By this Lease Landlord leases to Tenant and Tenant leases from Landlord the Premises in the Building as set forth and described on the Reference Pages. The Premises are depicted on the floor plan attached hereto as Exhibit A , and the Building is depicted on the site plan attached hereto as Exhibit A-1 . The Reference Pages, including all terms defined thereon, are incorporated as part of this Lease.

1. USE AND RESTRICTIONS ON USE .

     1.1 The Premises are to be used solely for the purposes set forth on the Reference Pages. Tenant shall not do or permit anything to be done in or about the Premises which will unreasonably obstruct or interfere with the rights of other tenants or occupants of the Building or injure, annoy, or disturb them, or allow the Premises to be used for any improper, immoral, unlawful, or objectionable purpose, or commit any waste. Tenant shall not do, permit or suffer in, on, or about the Premises the sale of any alcoholic liquor without the written consent of Landlord first obtained. Tenant shall comply with all governmental laws, ordinances and regulations applicable to the use of the Premises and its occupancy and shall promptly comply with all governmental orders and directions for the correction, prevention and abatement of any violations in the Building or appurtenant land, caused or permitted by, or resulting from the specific use by, Tenant, in or upon, or in connection with, the Premises, all at Tenant’s sole expense. Tenant shall not do or permit anything to be done on or about the Premises or bring or keep anything into the Premises which will in any way increase the rate of, invalidate or prevent the procuring of any insurance protecting against loss or damage to the Building or any of its contents by fire or other casualty or against liability for damage to property or injury to persons in or about the Building or any part thereof.

     1.2 Tenant shall not, and shall not direct, suffer or permit any of its agents, contractors, employees, licensees or invitees (collectively, the “Tenant Entities”) to at any time handle, use, manufacture, store or dispose of in or about the Premises or the Building any (collectively “Hazardous Materials”) flammables, explosives, radioactive materials, hazardous wastes or materials, toxic wastes or materials, or other similar substances, petroleum products or derivatives or any substance subject to regulation by or under any federal, state and local laws and ordinances relating to the protection of the environment or the keeping, use or disposition of environmentally hazardous materials, substances, or wastes, presently in effect or hereafter adopted, all amendments to any of them, and all rules and regulations issued pursuant to any of such laws or ordinances (collectively “Environmental Laws”), nor shall Tenant suffer or permit any Hazardous Materials to be used in any manner not fully in compliance with all Environmental Laws, in the Premises or the Building and appurtenant land or allow the environment to become contaminated with any Hazardous Materials. Notwithstanding the foregoing, Tenant may handle, store, use or dispose of products containing small quantities of Hazardous Materials (such as aerosol cans containing insecticides, toner for copiers, paints, paint remover and the like) to the extent customary and necessary for the use of the Premises for the use shown on the Reference Pages; provided that Tenant shall always handle, store, use, and dispose of any such Hazardous Materials in a safe and lawful manner and never allow such Hazardous Materials to contaminate the Premises, Building and appurtenant land or the environment. TENANT SHALL PROTECT, DEFEND, INDEMNIFY AND HOLD EACH AND ALL OF THE LANDLORD ENTITIES (AS DEFINED IN ARTICLE 30 ) HARMLESS FROM AND AGAINST ANY AND ALL LOSS, CLAIMS, LIABILITY (INCLUDING, WITHOUT LIMITATION, ANY STRICT LIABILITY) OR COSTS (INCLUDING COURT COSTS AND ATTORNEY’S FEES) INCURRED BY REASON OF ANY ACTUAL OR ASSERTED FAILURE OF TENANT TO FULLY COMPLY WITH ALL APPLICABLE ENVIRONMENTAL LAWS, OR THE PRESENCE, HANDLING, USE OR DISPOSITION IN OR FROM THE PREMISES OF ANY HAZARDOUS MATERIALS BY TENANT OR ANY TENANT ENTITY (EVEN THOUGH PERMISSIBLE UNDER ALL APPLICABLE ENVIRONMENTAL LAWS OR THE PROVISIONS OF THIS LEASE), OR BY REASON OF ANY ACTUAL OR ASSERTED FAILURE OF TENANT TO KEEP, OBSERVE, OR PERFORM ANY PROVISION OF THIS SECTION 1.2 .

     1.3 Tenant and the Tenant Entities will be entitled to the exclusive use of the common areas of the Building as they exist from time to time during the Term, including the parking facilities, subject to Landlord’s reasonable rules and regulations regarding such use (provided that in the event of a conflict between any such rules and regulations and the terms of this Lease, the terms of this Lease shall control). However, in no event will Tenant or the Tenant Entities park more vehicles in the parking facilities than Tenant’s Proportionate Share of the total

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parking spaces available for common use. The foregoing shall not be deemed to provide Tenant with an exclusive right to any parking spaces or any guaranty of the availability of any particular parking spaces or any specific number of parking spaces; provided that Landlord shall provide at all times a sufficient number of parking spaces for Tenant’s use in the Building as required by applicable law or code. Notwithstanding the foregoing, Landlord shall not alter the common areas of the Building (including, without limitation, the existing parking areas outside the Building) without Tenant’s prior written approval.

2. TERM .

     2.1 The Term of this Lease shall begin on the Commencement Date as shown on the Reference Pages, and shall terminate on the Termination Date as shown on the Reference Pages, unless sooner terminated by the provisions of this Lease. Landlord shall perform all the work to be performed by Landlord pursuant to Exhibit B to this Lease substantially completed. Tenant shall deliver a punch list of items not completed within thirty (30) days after notice from Landlord to Tenant that it has completed such work and Landlord agrees to proceed with due diligence to perform its obligations regarding such items.

     2.2 [INTENTIONALLY DELETED].

     2.3 In the event Landlord permits Tenant, or any agent, employee or contractor of Tenant, to enter, use or occupy the Premises prior to the Commencement Date, such entry, use or occupancy shall be subject to all the provisions of this Lease other than the payment of rent, including, without limitation, Tenant’s compliance with the insurance requirements of Article 11 . Said early possession shall not advance the Termination Date.

3. RENT .

     3.1 Tenant agrees to pay to Landlord the Annual Rent in effect from time to time by paying the Monthly Installment of Rent then in effect on or before the first day of each full calendar month during the Term. The Monthly Installment of Rent in effect at any time shall be one-twelfth (1/12) of the Annual Rent in effect at such time. Rent for any period during the Term which is less than a full month shall be a prorated portion of the Monthly Installment of Rent based upon the number of days in such month. Said rent shall be paid to Landlord, without deduction or offset and without notice or demand, at the Rent Payment Address, as set forth on the Reference Pages, or to such other person or at such other place as Landlord may from time to time designate in writing. If an Event of Default occurs, Landlord may require by notice to Tenant that all subsequent rent payments be made by an automatic payment from Tenant’s bank account to Landlord’s account, without cost to Landlord. Tenant must implement such automatic payment system prior to the next scheduled rent payment or within thirty (30) days after Landlord’s notice, whichever is later. Unless specified in this Lease to the contrary, all amounts and sums payable by Tenant to Landlord pursuant to this Lease shall be deemed additional rent.

     3.2 Tenant recognizes that late payment of any rent or other sum due under this Lease will result in administrative expense to Landlord, the extent of which additional expense is extremely difficult and economically impractical to ascertain. Tenant therefore agrees that if rent or any other sum is not paid when due and payable pursuant to this Lease, a late charge shall be imposed in an amount equal to the greater of: (i) Fifty Dollars ($50.00), or (ii) four percent (4%) of the unpaid rent or other payment. The amount of the late charge to be paid by Tenant shall be reassessed and added to Tenant’s obligation for each successive month until paid. The provisions of this Section 3.2 in no way relieve Tenant of the obligation to pay rent or other payments on or before the date on which they are due, nor do the terms of this Section 3.2 in any way affect Landlord’s remedies pursuant to Article 19 of this Lease in the event said rent or other payment is unpaid after date due.

4.  RENT ADJUSTMENTS .

     4.1 For the purpose of this Article 4 , the following terms are defined as follows:

           4.1.1 Lease Year : Each calendar year falling partly or wholly within the Term.

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           4.1.2 Expenses : All actual and reasonable costs incurred by Landlord in connection with the operation, maintenance, repair and management of the Building, as determined in accordance with generally accepted accounting principles, including the following costs by way of illustration, but not limitation: water and sewer charges; insurance charges of or relating to all insurance policies and endorsements deemed by Landlord to be reasonably necessary or desirable for the protection, preservation, or operation of the Building or any part thereof; utility costs, including, but not limited to, the cost of heat, light, power, steam, gas; waste disposal; the cost of janitorial services; the cost of security and alarm services (including any central station signaling system); costs of cleaning, repairing, replacing and maintaining the common areas, including parking and landscaping, window cleaning costs; labor costs; costs and expenses of managing the Building including management and/or administrative fees; air conditioning maintenance costs; elevator maintenance fees and supplies; material costs; equipment costs including the cost of maintenance, repair and service agreements and rental and leasing costs; purchase costs of equipment; current rental and leasing costs of items which would be capital items if purchased; tool costs; licenses, permits and inspection fees; wages and salaries of employees at or below the level of property manager engaged in the direct operation and maintenance of the Building; accounting and legal fees (other than any fees incurred in connection with lease negotiation or any fees incurred in connection with services or suits related to any particular tenant); any sales, use or service taxes incurred in connection therewith; provided that any items which are considered capital expenditures in accordance with generally accepted accounting principles may only be included in Expenses to the extent permitted in the following sentence. In addition, Landlord shall be entitled to include in Expenses: (i) an allocable portion of the cost of capital improvement items which are reasonably calculated to reduce operating expenses; (ii) the cost of fire sprinklers and suppression systems and other life safety systems; and (iii) other capital expenses which are required under any governmental laws, regulations or ordinances which were not applicable to the Building at the time it was constructed; but the costs described in this sentence shall be amortized over the reasonable life of such expenditures in accordance with such reasonable life and amortization schedules in accordance with generally accepted accounting principles, with interest on the unamortized amount at one percent (1%) in excess of the Wall Street Journal prime lending rate announced from time to time. Notwithstanding the foregoing or anything herein to the contrary, Expenses shall not include the following: (a) depreciation or amortization of the Building or equipment in the Building except as otherwise expressly provided for in this Section 4.1.2 ; (b) loan principal payments; (c) interest expenses on long-term borrowings; (d) costs of improvements or alterations of other tenants’ premises; (e) leasing commissions, attorney fees, and other expenses incurred in connection with leasing, renovating or improving space for tenants or prospective tenants of the Building or incurred in lease disputes; (f) advertising and promotional costs; (g) items or services for which Landlord is reimbursed by any tenant outside of Expenses or for which any tenant pays third persons, or which Landlord provides selectively to one or more tenants or occupants of the Building; (h) costs incurred due to violation by Landlord of any of the terms of this Lease or any other lease of space within the Building, or any fines, penalties, legal judgments or settlements of claims or causes of action by or against Landlord; (i) repairs or other work occasioned by fire, windstorm or other work paid for through insurance or condemnation proceeds; (j) the cost of installing, operating and maintaining any specialty service, such as an observatory, broadcasting facilities, luncheon club, athletic or recreational club; (k) salaries of officers and executives of Landlord and Landlord’s general overhead and administrative costs; (l) the cost of any work or service performed for any facility other than the Building; (m) insurance premiums to the extent Landlord may be reimbursed therefor; (n) rental under any ground lease or other underlying lease; (o) any costs representing an amount paid to any person or entity related to Landlord (or any partner in or affiliate of Landlord) that is in excess of the amount which would have been paid in the absence of such a relationship; (p) lease payments for rented equipment, the cost of which equipment would constitute a capital expense under generally accepted accounting principles, consistently applied, if the equipment were purchased; (q) any expenses for repairs or maintenance due to construction defects or that were covered by warranties in existence on the date of the full execution of this Lease; (r) costs or expenses of preparation of reports, filings and other information (including without limitation any and all income tax forms) furnished to any lender or an affiliate, partner, employee or contractor of or in Landlord; (s) costs or expenses of containing or removing any toxic or hazardous materials from the Building or the land on which the Building is located, to the extent that such costs or expenses do not result from Tenant’s use or occupancy of the Premises; or (t) costs or expenses relating to any offsite parking area or garage.

           4.1.3 Taxes : Real estate taxes and any other similar taxes, charges and assessments which are levied with respect to the Building or the land on which the Building is located; and all actual and reasonable fees, expenses and costs incurred by Landlord in investigating, protesting, contesting or in any way seeking to reduce or

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avoid increase in any assessments, levies or the tax rate pertaining to any Taxes to be paid by Landlord in any Lease Year. Taxes shall not include any corporate franchise, or estate, inheritance, general or net income tax, excise profit tax or any special assessments or impact fees assessed in connection with or relating to Landlord’s development or improvement of the Building, any tax imposed upon any transfer by Landlord of its interest in this Lease, the Building or the land on which the Building is located, or any taxes to be paid by Tenant pursuant to Article 28 . Tenant agrees that, as between Tenant and Landlord, Landlord has the initial and primary right to contest taxes levied against the Building and the Premises (other than taxes levied directly against Tenant’s personal property within, or sales made from, the Premises). Landlord agrees that it shall, upon reasonable advance written request therefor by Tenant, and if Landlord deems it reasonably prudent in the operation of the Building, make reasonable and diligent efforts to contest property valuations and otherwise minimize the Taxes, which may include retaining a tax consultant to assist in determining the fair tax valuation of the Building and protesting any unfair valuations. The costs incurred by Landlord in connection with the foregoing shall be included in the definition of Expenses. If Landlord fails to so contest or take such action following such a request and if such failure is continuing for thirty (30) days after Landlord’s receipt of written notice thereof, then Tenant shall thereafter be entitled to contest such property valuation or take such action with respect to the Premises and/or any larger parcel of which the Premises is a part, at Tenant’s sole cost and expense (but which expense shall be reimbursed from any savings or abatement, if any, realized as a result of any such contest or other action). Tenant agrees without reservation that, except as expressly set forth above, it will not protest or appeal any such appraisal or reappraisal before a governmental taxing authority without the prior written consent of Landlord.

     4.2 Tenant shall pay as additional rent for each Lease Year Tenant’s Proportionate Share of Expenses and Taxes incurred for such Lease Year.

     4.3 The annual determination of Expenses and Taxes shall be made by Landlord and a statement invoicing and evidencing such determination (the “Statement”) shall be delivered to Tenant by Landlord within one hundred twenty (120) days following the expiration of any calendar year during the Term, which determination shall be binding upon Landlord and Tenant, subject to the provisions of this Section 4.3 . During the Term, Tenant may review, at Tenant’s sole cost and expense (provided that in the event any such review by Tenant evidences a discrepancy in such annual determination by Landlord in excess of five percent (5%) of such Expenses or Taxes, then Landlord shall reimburse Tenant for Tenant’s actual and reasonable costs of such review), the books and records supporting the Statement in an office of Landlord or Landlord’s agent located in the Dallas/Fort Worth Metroplex, during normal business hours, upon giving Landlord five (5) days advance written notice within ninety (90) days after receipt of the Statement, but in no event more often than once in any one (1) year period, provided that if Tenant utilizes an independent accountant to perform such review it shall be one of national standing which is reasonably acceptable to Landlord and is not compensated on a contingency basis. Tenant and such party performing such review shall keep all information obtained during such review strictly confidential and shall not disclose the information to anyone or any entity (other than the managerial and administrative staff of Tenant and such reviewing party and such parties’ professional consultants, as may be reasonably necessary in connection therewith, all of whom shall likewise keep such information confidential, and/or as may be required by law). If Tenant fails to object to Landlord’s determination of Expenses or Taxes as provided in the Statement within ninety (90) days after Tenant’s receipt of the Statement, or if any such objection fails to state with specificity the reason for the objection, Tenant shall be deemed to have approved the Statement and shall have no further right to object to or contest same.

     4.4 Prior to the actual determination thereof for a Lease Year, Landlord may from time to time (provided that Landlord will not change such estimate more often than one [1] time per year) estimate Tenant’s liability for Expenses and/or Taxes under Section 4.2 , Article 6 and Article 28 for the Lease Year or portion thereof. Landlord will give Tenant written notification of the amount of such estimate and Tenant agrees that it will pay, by increase of its Monthly Installments of Rent due in such Lease Year, additional rent in the amount of such estimate. Any such increased rate of Monthly Installments of Rent pursuant to this Section 4.4 shall remain in effect until further written notification to Tenant pursuant hereto.

     4.5 When the above mentioned actual determination of Tenant’s liability for Expenses and/or Taxes is made for any Lease Year as evidenced by Landlord’s Statement, or if Tenant’s review of Landlord’s records reveals

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any discrepancy between the amount actually paid by Tenant with respect to Expenses and/or Taxes and the amount of Tenant’s liability with respect thereto, then:

     4.5.1 If the total additional rent Tenant actually paid pursuant to Section 4.3 on account of Expenses and/or Taxes for the Lease Year is less than Tenant’s liability for Expenses and/or Taxes, then Tenant shall pay such deficiency to Landlord as additional rent in one lump sum within sixty (60) days of receipt of Landlord’s bill therefor; and

     4.5.2 If the total additional rent Tenant actually paid pursuant to Section 4.3 on account of Expenses and/or Taxes for the Lease Year is more than Tenant’s liability for Expenses and/or Taxes, then Landlord shall credit the difference against the then next due payments to be made by Tenant under this Article 4 , or, if the Lease has terminated, refund the difference in cash.

     4.6 If the Commencement Date is other than January 1 or if the Termination Date is other than December 31, Tenant’s liability for Expenses and Taxes for the Lease Year in which said Date occurs shall be prorated based upon a three hundred sixty-five (365) day year.

5. SECURITY DEPOSIT . [INTENTIONALLY DELETED].

6. ALTERATIONS .

     6.1 Except for those, if any, specifically provided for in Exhibit B to this Lease, Tenant shall not make or suffer to be made any alterations, additions, or improvements, including, but not limited to, the attachment of any fixtures or equipment in, on, or to the Premises or any part thereof, without the prior written consent of Landlord (which consent shall not be unreasonably withheld or delayed). When applying for such consent, Tenant shall, if requested by Landlord, furnish complete plans and specifications for such alterations, additions and improvements. Landlord’s consent shall not be unreasonably withheld with respect to alterations which (i) are not structural in nature, (ii) are not visible from the exterior of the Building, and (iii) do not affect or require modification of the Building’s electrical, mechanical, plumbing, HVAC or other systems.

     6.2 In the event Landlord consents to the making of any such alteration, addition or improvement by Tenant, the same shall be made by using either Landlord’s contractor or a contractor reasonably approved by Landlord, in either event at Tenant’s sole cost and expense. In any event Landlord may charge Tenant a construction management fee not to exceed three percent (3%) of the cost of such work to cover its overhead as it relates to such proposed work, plus third-party costs actually and reasonably incurred by Landlord in connection with the proposed work and the design thereof, with all such amounts being due thirty (30) days after Landlord’s demand.

     6.3 All alterations, additions or improvements proposed by Tenant shall be constructed in accordance with all government laws, ordinances, rules and regulations, using Building standard materials where applicable, and Tenant shall, prior to construction, provide the additional insurance required under Article 11 in such case, and also, if reasonably required by Landlord, shall provide notices of non-responsibility and lien waivers as reasonably necessary to protect Landlord and the Building and the land upon which the Building is located against any loss from any mechanic’s, materialmen’s or other liens. Tenant shall pay in addition to any sums due pursuant to Article 4 any increase in real estate taxes attributable to any such alteration, addition or improvement for so long, during the Term, as such increase is ascertainable; at Landlord’s election said sums shall be paid in the same way as sums due under Article 4 . Landlord may, as a condition to its consent to any particular alterations or improvements, require Tenant to deposit with Landlord the amount reasonably estimated by Landlord as sufficient to cover the cost of removing such alterations or improvements and restoring the Premises, to the extent required under Section 26.2 with respect to those Alterations that Landlord will require Tenant to remove.

7. REPAIR .

     7.1 Landlord shall have no obligation to alter, remodel, improve, repair, decorate or paint the Premises, except as specified in Exhibit B if attached to this Lease and except that Landlord shall repair and

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maintain the structural portions of the Building (including without limitation the roof, foundation and walls of the Building), and the common areas. By taking possession of the Premises, Tenant accepts them as being in good order, condition and repair and in the condition in which Landlord is obligated to deliver them, except as set forth in the punch list to be delivered pursuant to Section 2.1 . It is hereby understood and agreed that no representations respecting the condition of the Premises or the Building have been made by Landlord to Tenant, except as specifically set forth in this Lease. Landlord shall not be liable for any failure to make any repairs or to perform any maintenance unless such failure shall persist for thirty (30) days after written notice of the need of such repairs or maintenance is given to Landlord by Tenant, in which event Tenant shall be permitted to make such repairs or perform such maintenance, and Landlord shall reimburse Tenant for the actual and reasonable cost thereof incurred by Tenant within thirty (30) days after receipt of Tenant’s invoice; provided, however, that Landlord shall not be liable for any failure to make any repairs or to perform any maintenance if such failure could not reasonably be cured during such thirty (30) day period, and Landlord has commenced the cure within such thirty (30) day period and thereafter is diligently pursuing such cure to completion. Notwithstanding the foregoing, in the event of an emergency wherein Landlord is not available by telephone or facsimile after attempts of Tenant to do so, Tenant shall be permitted to make such repairs to the Leased Premises that are necessary to immediately protect or preserve its property, secure the Leased Premises, or protect the life, health or safety of its employees or customers (“Emergency Repairs”). Tenant shall immediately notify Landlord of any Emergency Repairs.

     7.2 Tenant shall at its own cost and expense keep and maintain all parts of the Premises and such portion of the Building and improvements as are within the exclusive control of Tenant in good condition, promptly making all necessary repairs and replacements, whether ordinary or extraordinary, with materials and workmanship of the same character, kind and quality as the original (including, but not limited to, repair and replacement of all fixtures installed by Tenant, water heaters serving the Premises, windows, glass and plate glass, doors, exterior stairs, skylights, any special office entries, interior walls and finish work, floors and floor coverings, heating and air conditioning systems serving the Premises, electrical systems and fixtures, sprinkler systems, dock boards, truck doors, dock bumpers, plumbing work and fixtures, and performance of regular removal of trash and debris). Tenant as part of its obligations hereunder shall keep the Premises in a clean and sanitary condition. Upon termination of this Lease in any way Tenant will yield up the Premises to Landlord in good condition and repair, reasonable wear and tear and loss by fire or other casualty excepted (but not excepting any damage to glass). Tenant shall, at its own cost and expense, repair any damage to the Premises or the Building resulting from and/or caused in whole or in part by the negligence or misconduct of Tenant, its agents, employees, contractors, invitees, or any other person entering upon the Premises as a result of Tenant’s business activities or caused by Tenant’s default hereunder.

     7.3 Except as provided in Article 22 , there shall be no abatement of rent and no liability of Landlord by reason of any injury to or interference with Tenant’s business arising from the making of any repairs, alterations or improvements in or to any portion of the Building or the Premises or to fixtures, appurtenances and equipment in the Building. Except as provided herein and except to the extent, if any, prohibited by law, Tenant waives the right to make repairs at Landlord’s expense under any law, statute or ordinance now or hereinafter in effect.

     7.4 Tenant shall, at its own cost and expense, enter into a regularly scheduled preventive maintenance/service contract with a maintenance contractor reasonably approved by Landlord for servicing all heating and air conditioning systems and equipment serving the Premises (and a copy thereof shall be furnished to Landlord). The service contract must become effective within thirty (30) days of the date Tenant takes possession of the Premises. Should Tenant fail to do so, Landlord may, upon notice to Tenant, enter into such a maintenance/ service contract on behalf of Tenant or perform the work and in either case, charge Tenant the actual and reasonable cost thereof along with a reasonable amount for Landlord’s overhead.

     7.5 Landlord shall coordinate any repairs and other maintenance of any railroad tracks serving the Building and, if Tenant uses such rail tracks, Tenant shall reimburse Landlord or the railroad company from time to time upon demand, as additional rent, for its share of the actual and reasonable costs of Landlord of such repair and maintenance, such costs to be borne proportionately by all tenants in the Building using such rail tracks, based upon the actual number of rail cars shipped and received by such tenant during each calendar year during the Term.

8. LIENS . Tenant shall keep the Premises, the Building and appurtenant land and Tenant’s leasehold interest in the Premises free from any liens arising out of any services, work or materials performed, furnished, or contracted

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for by Tenant, or obligations incurred by Tenant. In the event that Tenant fails, within ten (10) days following the imposition of any such lien, to either cause the same to be released of record or provide Landlord with reasonable protection against the same, Landlord shall have the right to cause the same to be released by such means as it shall deem proper, including payment of the claim giving rise to such lien. All such sums paid by Landlord and all expenses incurred by it in connection therewith shall be payable to it by Tenant within five (5) days of Landlord’s demand.

9. ASSIGNMENT AND SUBLETTING .

     9.1 Except as otherwise expressly set forth in this Lease, Tenant shall not have the right to assign or pledge this Lease or to sublet the whole or any part of the Premises whether voluntarily or by operation of law, or permit the use or occupancy of the Premises by anyone other than Tenant, and shall not make, suffer or permit such assignment, subleasing or occupancy without the prior written consent of Landlord, such consent not to be unreasonably withheld, and said restrictions shall be binding upon any and all assignees of the Lease and subtenants of the Premises. In the event Tenant desires to sublet, or permit such occupancy of, the Premises, or any portion thereof, or assign this Lease, Tenant shall give written notice thereof to Landlord at least sixty (60) days but no more than one hundred eighty (180) days prior to the proposed commencement date of such subletting or assignment, which notice shall set forth the name of the proposed subtenant or assignee, the relevant terms of any sublease or assignment and copies of financial reports and other relevant financial information of the proposed subtenant or assignee.

     9.2 Notwithstanding any assignment or subletting, permitted or otherwise, Tenant shall at all times remain directly, primarily and fully responsible and liable for the payment of the rent specified in this Lease and for compliance with all of its other obligations under the terms, provisions and covenants of this Lease. Upon the occurrence of an Event of Default, if the Premises or any part of them are then assigned or sublet, Landlord, in addition to any other remedies provided in this Lease or provided by law, may, at its option, collect directly from such assignee or subtenant all rents due and becoming due to Tenant under such assignment or sublease and apply such rent against any sums due to Landlord from Tenant under this Lease, and no such collection shall be construed to constitute a novation or release of Tenant from the further performance of Tenant’s obligations under this Lease.

     9.3 [INTENTIONALLY DELETED].

     9.4 In the event that Tenant sells, sublets, assigns or transfers this Lease, Tenant shall pay to Landlord as additional rent an amount equal to fifty percent (50%) of any Increased Rent (as defined below), less the Costs Component (as defined below), when and as such Increased Rent is received by Tenant. As used in this Section, “Increased Rent” shall mean the excess of (i) all rent and other consideration which Tenant is entitled to receive by reason of any sale, sublease, assignment or other transfer of this Lease, over (ii) the rent otherwise payable by Tenant under this Lease at such time. For purposes of the foregoing, any consideration received by Tenant in form other than cash shall be valued at its fair market value as reasonably determined by Landlord in good faith; provided, however, in connection with a transfer which is a part of the sale of the business of Tenant (whether by sale of assets, sale of stock or otherwise), Increased Rent shall not include any consideration received by Tenant related to such sale of the business. The “Costs Component” is that amount which, if paid monthly, would fully amortize on a straight-line basis, over the entire period for which Tenant is to receive Increased Rent, is equal to fifty percent (50%) of the reasonable costs incurred by Tenant for leasing commissions, tenant improvements and other actual and reasonable costs incurred by Tenant in connection with such sublease, assignment or other transfer.

     9.5 Notwithstanding any other provision hereof, it shall be considered reasonable for Landlord to withhold its consent to any assignment of this Lease or sublease of any portion of the Premises if at the time of either Tenant’s notice of the proposed assignment or sublease or the proposed commencement date thereof, there shall exist Event of Default of Tenant, or if the proposed assignee or sublessee is an entity: (i) with which Landlord is already in negotiation; (ii) is already an occupant of the Building unless Landlord is unable to provide the amount of space required by such occupant; (iii) is a governmental agency; (iv) is incompatible with the character of occupancy of the Building; or (v) would subject the Premises to a use which would: (a) involve materially increased personnel or wear upon the Building; (b) violate any exclusive right granted to another tenant of the Building; (c) require any addition to or modification of the Premises or the Building in order to comply with

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building code or other governmental requirements which would not otherwise be required to be made by Landlord pursuant to this Lease; or, (d) involve a violation of Section 1.2 . Tenant expressly agrees that for the purposes of any statutory or other requirement of reasonableness on the part of Landlord, Landlord’s refusal to consent to any assignment or sublease for any of the reasons described in this Section 9.5 , shall be conclusively deemed to be reasonable.

     9.6 Upon any request to assign or sublet, Tenant will pay to Landlord on demand, a sum equal to all of Landlord’s costs, including reasonable attorneys’ fees, incurred in investigating and considering any proposed or purported assignment or pledge of this Lease or sublease of any of the Premises, regardless of whether Landlord shall consent to, refuse consent, or determine that Landlord’s consent is not required for, such assignment, pledge or sublease. Any purported sale, assignment, mortgage, transfer of this Lease or subletting which does not comply with the provisions of this Article 9 shall be void.

     9.7 If Tenant is a corporation, limited liability company, partnership or trust, any transfer or transfers of or change or changes within any twelve (12) month period in the number of the outstanding voting shares of the corporation or limited liability company, the general partnership interests in the partnership or the identity of the persons or entities controlling the activities of such partnership or trust, which results in the persons or entities owning or controlling a majority of such shares, partnership interests or activities of such partnership or trust at the beginning of such period no longer having such ownership or control shall be regarded as equivalent to an assignment of this Lease to the persons or entities acquiring such ownership or control and shall be subject to all the provisions of this Article 9 to the same extent and for all intents and purposes as though such is an assignment. The previous sentence shall not apply, however, if at the time of the execution of this Lease, Tenant is a corporation and the outstanding voting shares of capital stock of Tenant are listed on a recognized security exchange or over-the-counter market.

     9.8 Notwithstanding anything contained in this Lease to the contrary, so long as no Event of Default then exists, Tenant shall have the right, without the consent or approval of Landlord (but after notice to Landlord) to assign, sublease or otherwise transfer its interest in this Lease (a) to any corporation, joint venture, partnership or other entity which is a successor to Tenant resulting from a merger or consolidation, (b) to a purchaser of all or substantially all of Tenant’s assets, or (c) to a corporation, joint venture, partnership or other entity which shall directly or indirectly control, be under the control of, or be under common control with, Tenant (collectively, “Permitted Transferee”). Notwithstanding the foregoing, such Permitted Transferee (or Tenant if Tenant survives) must have a net worth equal to or greater than Tenant’s net worth at the time of such transfer. For purposes hereof, “control” shall be deemed to mean the direct or indirect ownership of more than fifty percent (50%) of the outstanding voting stock of a corporation or other majority equity and control interest if not a corporation. Tenant must (a) notify Landlord in writing of the name of the proposed assignee within fifteen (15) days of actual assignment or sublease with such Permitted Transferee agreeing to be bound by the terms and conditions set forth herein and shall fully assume all of the obligations and liabilities imposed upon Tenant hereunder, and (b) upon Landlord’s request, Tenant and the Permitted Transferee shall execute such documents as reasonably requested by Landlord to evidence such assignment or sublease. Notwithstanding any assignment or sublease, Tenant shall at all times remain fully responsible and liable for the payment of the rent and for compliance with all of Tenant’s other obligations under this Lease (regardless of whether Landlord’s approval has been obtained for any such assignment or transfer). Notwithstanding anything to the contrary, the Premises may be used solely for the purposes set forth on the Reference Pages subsequent to any transfer..

10.  INDEMNIFICATION . NONE OF THE LANDLORD ENTITIES SHALL BE LIABLE AND TENANT HEREBY WAIVES ALL CLAIMS AGAINST THEM FOR ANY DAMAGE TO ANY PROPERTY OR ANY INJURY TO ANY PERSON IN OR ABOUT THE PREMISES OR THE BUILDING BY OR FROM ANY CAUSE WHATSOEVER (INCLUDING WITHOUT LIMITING THE FOREGOING, RAIN OR WATER LEAKAGE OF ANY CHARACTER FROM THE ROOF, WINDOWS, WALLS, BASEMENT, PIPES, PLUMBING WORKS OR APPLIANCES, THE BUILDING NOT BEING IN GOOD CONDITION OR REPAIR, GAS, FIRE, OIL, ELECTRICITY OR THEFT), EXCEPT TO THE EXTENT CAUSED BY OR ARISING FROM THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF LANDLORD OR ITS AGENTS, EMPLOYEES OR CONTRACTORS. TENANT SHALL PROTECT, DEFEND, INDEMNIFY AND HOLD THE LANDLORD ENTITIES HARMLESS FROM AND AGAINST

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      LANDLORD AGREES TO INDEMNIFY, DEFEND AND HOLD TENANT HARMLESS FROM AND AGAINST ANY AND ALL CLAIMS AND DEMANDS OF ANY THIRD PARTY ARISING FROM OR BASED UPON ANY GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF LANDLORD OR LANDLORD’S AGENTS, EMPLOYEES OR CONTRACTORS. THE FURNISHING OF INSURANCE REQUIRED UNDER THIS LEASE SHALL NOT BE DEEMED TO LIMIT LANDLORD’S OBLIGATIONS UNDER THIS PARAGRAPH.

      THE PROVISIONS OF THIS ARTICLE SHALL SURVIVE THE TERMINATION OF THIS LEASE WITH RESPECT TO ANY CLAIMS OR LIABILITY ACCRUING PRIOR TO SUCH TERMINATION.

11. INSURANCE .

     11.1 Tenant shall keep in force throughout the Term: (i) a Commercial General Liability insurance policy or policies insuring Tenant against all claims, demands, or actions arising out of or in connection with Tenant’s use or occupancy of the Premises, or by the condition of the Premises, with a limit of not less than $1,000,000 per occurrence and not less than $2,000,000 in the annual aggregate, covering bodily injury and property damage liability and $1,000,000 products/completed operations aggregate; (ii) insurance protecting against liability under Worker’s Compensation Laws with limits at least as required by statute; (iii) Employers Liability with limits of $1,000,000 each accident, $1,000,000 disease policy limit, $1,000,000 disease—each employee; (iv) All Risk or Special Form coverage protecting Tenant against loss of or damage to Tenant’s alterations, additions, improvements, carpeting, floor coverings, panelings, decorations, fixtures, inventory and other business personal property situated in or about the Premises to the full replacement value of the property so insured, and (v) Excess Liability in the amount of $2,000,000.

     11.2 The aforesaid policies shall (i) be provided at Tenant’s expense; (ii) name Landlord and Landlord’s property manager as additional insureds (General Liability) and loss payee (Property—Special Form);

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(ii) be issued by an insurance company with a minimum Best’s rating of “A:VII” during t