I nil MININUI Main IM IUI CFN 2012024867 Bk 04234 Pss 0320 - 357; (38Pss) DATE: 02/20/2012 04:00:43 PM MALCOM THOMPSONp CLERK OF COURT OSCEOLA COUNTY RECORDING FEES' 0.00

AGREEMENT AND LEASE

By and Between

OSCEOLA COUNTY, FLORIDA

AND

COLT'S MANUFACTURING COMPANY LLC

TABLE OF CONTENTS

PAGE

ARTICLE I

DEFINITIONS AND INTERPRETATION

SECTION 1.01. DEFINITIONS 2 SECTION 1.02. INTERPRETATION 3 SECTION 1.03. SECTION HEADINGS 3

ARTICLE II

REPRESENTATIONS

SECTION 2.01. REPRESENTATIONS OF THE COUNTY 4 SECTION 2.02. REPRESENTATIONS OF COLT 4

ARTICLE III

LEASE

SECTION 3.01. LEASE OF THE FACILITY 6 SECTION 3.02. POSSESSION OF THE FACILITY 6 SECTION 3.03. TERM AND TERMINATION 6 SECTION 3.04. ENVIRONMENTAL AUDIT 0 6 SECTION 3.05. MOLD INSPECTION 7 SECTION 3.06. COUNTY IMPROVEMENTS 7 SECTION 3.07. COLT IMPROVEMENTS 8 SECTION 3.08. USE OF THE FACILITY 9 SECTION 3.09. OPERATION AND MAINTENANCE 10 SECTION 110. ADVERTISING AND SIGNAGE 10 SECTION 111. COMPLIANCE WITH LEGAL REQUIREMENTS 10 SECTION 3.12. HAZARDOUS SUBSTANCES 10 SECTION 3.13. LIENS AND ENCUMBRANCES 12 SECTION 3.14. TAXES ON LEASEHOLD OR PERSONALTY 13 SECTION 3.15. RENT AND UTILITIES 13 SECTION 3.16: INDEMNIFICATION 14 SECTION 3.17. INSURANCE 15 SECTION 3.18. DAMAGE OR DESTRUCTION 16 SECTION 3.19. DEFAULTS AND REMEDIES 17 SECTION 3.20. ENTRY AND INSPECTION 18 SECTION 3.21. SURRENDER 18 SECTION 3.22. HOLDING OVER 19 SECTION 3.23. SURVIVAL OF OBLIGATIONS 19

ARTICLE IV

GENERAL PROVISIONS

SECTION 4.01. NOTICE AND CURE 20 SECTION 4.02. RESOLUTION OF DISPUTES 20 SECTION 4.03. ASSIGNMENT 21 SECTION 4.04. TIME OF THE ESSENCE 21 SECTION 4.05. EXTENSION OF TIME PERIODS 21 SECTION 4.06. NO JOINT VENTURE 21 SECTION 4.07. NON-WAIVER 21 SECTION 4.08. COUNTERPARTS 21 SECTION 4.09. ENTIRE AGREEMENT 21 SECTION 4.10. BINDING EFFECT 21 SECTION 4.11. AMENDMENTS AND WAIVERS 21 SECTION 4.12. NOTICES TO PARTIES 22 SECTION 4.13. SEVERABILITY 22 SECTION 4.14. GOVERNING LAW AND VENUE 22 SECTION 4.15. LITIGATION 23 SECTION 4.16. RADON DISCLOSURE 23 SECTION 4.17. INDEPENDENT CONTRACTOR 23 SECTION 4.18. CONFLICT OF INTEREST 24 SECTION 4.19. REMEDIES 24 SECTION 4.20. EXPANSION 24 SECTION 4.2L RECORDATION 24

APPENDIX A

DEPICTION OF THE FACILITY APPENDIX B

SCHEMATIC DIAGRAM OF THE COUNTY IMPROVEMENTS APPENDIX C

DESCRIPTION OF THE COUNTY IMPROVEMENTS

AGREEMENT AND LEASE

THIS AGREEMENT AND LEASE (this "Lease") is made and entered into by and between Osceola County, a charter county and political subdivision of the State of Florida, 1 Courthouse Square, Kissimmee, Florida 34741 (the "County"), and Colt's Manufacturing Company LLC, ("Colt").

WITNESSETH:

WHEREAS, the parties hereto have agreed to the terms and conditions cited herein; and

WHEREAS, the County is the owner of a 16,490 square foot building at 1099 Shady Lane, in Kissimmee, Florida, commonly known as the former Council on Aging facility (the "Facility"); and

WHEREAS, the Facility has been vacant for nearly five years; and

WHEREAS, the parties have determined that the Facility is the ideal location for Colt's regional headquarters for the manufacturing of firearms; and

WHEREAS, it is the desire of the County and Colt to design and to renovate and construct improvements to the Facility to better serve Colt's intended use; and

WHEREAS, the Facility will ultimately employ a minimum of 63 full time employees, at an average salary of $48,225.00, excluding benefits; and

WHEREAS, the parties anticipate that Colt's overall capital investment in the County will reach an estimated amount of $2,500,000 within 5 years; and

WHEREAS, Colt is a company that has a rich history spanning over a 175 year period and is an American icon; and

WHEREAS, the location of the regional headquarters and the manufacturing of firearms at the Facility will be a harmonious addition to other businesses in the area, which also specialize in aspects related to firearms manufacturing and, as such, the Facility will provide an dconomic stimulus and bring diversity to the County's existing manufacturing base; and

WHEREAS, Colt's history and status in American culture will also attract tourists and visitors to the County;

NOW THEREFORE, in consideration of the mutual covenants, terms, and provisions contained herein, the parties agree as follows:

ARTICLE I

DEFINITIONS AND INTERPRETATION

SECTION 1.01. DEFINITIONS. As used in this Lease, the following terms shall have the following meanings, unless the context hereof otherwise requires.

"Colt" means Colt's Manufacturing Company LLC.

"Colt Contamination" means any contamination of the Facility by Hazardous Substances caused by the act or omission of Colt.

"Colt Improvements" means any alteration or improvement to the Facility made by Colt during the term of this Lease that is estimated in accordance with generally accepted cost-accounting principles to cost more than $75,000.

"County" means Osceola County, a charter county and political subdivision of the State of Florida.

"County Manager" means the chief executive officer of the County, or such person's designee.

"County Improvements" means the improvements depicted in the schematic diagram attached as Appendix B and described in Appendix C.

"County's Certificate of Substantial Completion" means a certificate issued and executed by the County's Construction Manager, stating that based on its on-site inspections and other normal and customary due diligence investigations, the County Improvements are sufficiently complete for Colt to begin construction and installation of any Colt Improvements, subject only to completion of punch list of minor items to be completed and minor deficiencies to be corrected.

"County's Construction Manager" means the firm contracted by the County to provide construction management services for the County hppr,ovements.

3 vvm 2ca, "Effective Date" means October/K. 2011, the date this Lease was approved by the

County's BOard of Commissioners.

"Environmental Law" means any and all federal, state and local laws, statutes, ordinances, ruies, regulations, judgments, orders, decrees, permits, licenses or other governmental restrictions or requirements now or hereafter in effect with respect to the property and relating to the environment and/or hazardous substances, including without limitation the Comprehensive Environmental Response, Compensation and Liability Comprehensive Environmental Response, Compensation and Liability Act of 1986, as amended (42 U.S.C. §9601 et seq.), the Resource Conservation Recovery Act, as amended by the Hazardous and Solid Waste Amendments of 1984, as now or hereafter amended (42 U.S.C. §6901 et seq.), the Hazardous Materials Transportation Act, as amended (49 U.S.C. §1801 et seq.), the Clean Air

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Act, as amended (42 U.S.C. §7401 et seq.), the Clean Water Act, as amended (33 U.S.C. §1251 et seq.), and the Toxic Substances and Control Act, as amended (15 U.S.C. §2601 et seq.).

"Facility" means the 16,490 square foot building located at 1099 , Shady Lane, in Kissimmee, Florida, commonly known as the former Council on Aging facility, as depicted in Appendix A.

"Hazardous Substance" means any substance, material or waste which is regulated or governed by any Environmental Law including without limitation (A) any substance, material or waste defined, used or listed as "hazardous waste", "extremely hazardous waste", "restricted hazardous waste", "hazardous substance", "hazardous material", "toxic substance" or similar or related term as defined, used or listed in any Environmental Law; (B) any asbestos or asbestos containing materials; (C) any underground storage tanks or similar facilities; (D) petroleum, petroleum-based substances or polychlorinated biphenyl; and (E) any additional substances or materials which are hazardous or toxic substances under any Environmental Law.

"Phase I Environmental Audit" means a preliminary review of potential Hazardous Substance contamination.

"Phase II Environmental Audit" means a detailed investigation of Hazardous Substance contamination throtigh physical samplings and analyses to determine the nature and extent of contamination and, if indicated, a description of the recommended remediation method.

"Punch List" means the list of minor items to be completed and deficiencies to be corrected after the County Improvements are Substantially Complete.

"State Funds" means $250,000 to be received by Colt for improvements to the Facility from the Quick Action Closing Fund created pursuant Section 288.1088, Florida Statutes.

SECTION 1.02. INTERPRETATION. Words importing the singular number shall include the plural in each case and vice versa, and words importing persons shall include firms and corporations. The terms "herein", "hereunder", "hereby", "hereof', and any similar terms, shall refer to this Lease; the term "heretofore" shall mean before the date this Lease is executed; and the term "hereafter" shall mean after the date this Lease is executed. Each recital, covenant, agreement, representation and warranty made by a party herein shall be deemed to have been material and to have been relied on by the other parties to this Lease. All parties have participated the drafting and preparation of this Lease, and the provisions hereof shall not be construed for or against any party by reason of authorship.

SECTION 1.03. SECTION HEADINGS. Any headings preceding the texts of the several Sections of this Lease and any table of contents or marginal notes appended to copies hereof, shall be solely for convenience of reference and shall neither constitute a part of this Lease nor affect its meaning, construction or effect.

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• ARTICLE II

REPRESENTATIONS

SECTION 2.01. REPRESENTATIONS OF THE COUNTY.

The County makes the following representations as the basis for the undertakings on the part of Colt herein contained:

(A) The County is a charter county and political subdivision of the State of Florida, and has all requisite power and authority to enter into the transactions contemplated by this Lease and to carry out its obligations hereunder and thereunder.

(B) The County is not in default under any provisions of applicable law material to the performance of its obligations under this Lease.

(C) The County has duly authorized the execution and delivery of this Lease and assuming the due authorization, execution and delivery by Colt, this Lease constitutes a valid and legally binding obligation of the County, enforceable in accordance with its terms, except to the extent that enforceability thereof may be limited by any applicable bankruptcy, insolvency, moratorium, reorganization or other similar laws affecting creditors' rights generally, or by the exercise of judicial discretion in accordance with general principles of

(D) The authorization, execution and delivery of this Lease, and the compliance by the County with the provisions hereof will not conflict with or constitute a material breach of, or default under, any existing law, court or administrative regulation, decree, order or any provision of the Constitution or laws of the State of Florida relating to the County or its affairs, or any ordinance, resolution, agreement, mortgage, lease or other instrument to which the County is subject or by which it is bound.

(E) There is no action, suit, proceeding or investigation at law or in equity before or by any court, public board or body pending or, to the best knowledge of the County, threatened against or affecting the County, wherein an unfavorable decision, ruling or finding would materially adversely affect the transactions contemplated hereby or which, in any way, would materially adversely affect the validity of this Lease, or any agreement or instrument to which the County is a party and which is used or contemplated for use in the consummation of the transactions' contemplated hereby.

(F) The County has clear title to the Facility, which is properly zoned for the purposes described in Section 3.08. Upon completion of the County Improvements, the Facility will satisfy the requirements set forth in the Americans with Disabilities Act.

SECTION 2.02. REPRESENTATIONS OF COLT.

(A) Colt is a Delaware limited liability company, registered to do business in Florida as of the Effective Date, and has all requisite power and authority to enter into the transactions contemplated by this Lease and to carry out its obligations hereunder and thereunder.

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(B) Colt is not in default under any provisions of applicable law material to the performance of its obligations under this Lease.

(C) Colt has duly authorized the execution and delivery of this Lease and assuming the due authorization, execution and delivery by the County, this Lease constitutes a valid and legally binding obligation of Colt enforceable in accordance with its terms, except to the extent that enforceability thereof may be limited by any applicable bankruptcy, insolvency, moratorium, reorganization or other similar laws affecting creditors' rights generally, or by the exercise of judicial discretion in accordance with general principles of equity.

(D) The authorization, execution and delivery of this Lease, and the compliance by Colt with the provisions hereof will not conflict with or constitute a material breach of, or default under, any existing law, court or administrative regulation, decree, order or any provision of the Constitution or laws of the State of Florida relating to Colt or its affairs, or any ordinance, resolution, agreement, mortgage, lease or other instrument to which Colt is subject or by which it is bound.

(E) There is no action, suit, proceeding or investigation at law or in equity before or by any court, public board or body pending or, to the best knowledge of Colt, threatened against or affecting Colt, wherein an unfavorable decision, ruling or finding would materially adversely affect the transactions contemplated hereby or which, in any way, would materially adversely affect the validity of this Lease, or any agreement or instrument to which Colt is a party and which is used or contemplated for use in the consummation of the transactions contemplated hereby.

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ARTICLE III

LEASE

SECTION 3.01. LEASE OF THE FACILITY. For and in consideration of the covenants and obligations specified in this Lease, the County leases the Facility located at 1099 Shady Lane, Kissimmee, Florida, to Colt, and Colt leases the Facility from the County, all subject to the conditions and limitations herein expressed. The lease includes the use of the common entrance and driveway, parking area and associated grounds, as further depicted on Appendix A, attached hereto and incorporated herein by reference.

SECTION 3.02. POSSESSION OF THE FACILITY. Colt acknowledges that it may not take immediate possession of the Facility on the Effective Date. Possession of the Facility by Colt shall occur upon execution of the County's Certificate of Substantial Completion and receipt of a confirming certificate from Colt's construction representative.

SECTION 3.03. TERM AND TERMINATION. The term of this Lease shall be for a period of twelve (12) years from the Effective Date. Notwithstanding the foregoing, this Lease may be terminated if

(A) Colt fails to perform any of its obligations under the Lease and does not cure such failure, after notice from the County, within the time periods specified in Section 3.19 hereof;

(B) within 36 months after Colt takes possession of the Facility as set forth in Section 3.02 hereof, Colt has failed to hire and to maintain 63 full time employees, at an average wage of $48,225, or if after 36 months following the date Colt takes possession of the Facility, Colt fails to maintain said employee and salary commitment for longer than 90 days, after notice from the County, within the time periods specified in Section 3.19 hereof, and Colt has failed to pay the associated penalty, as set forth in Section 3.19;

(C) the County and Colt mutually agree to terminate the Lease, in writing; or

(D) as further set forth herein.

In such event, Colt shall execute and record a formal termination of this Lease and quit claim all of its right, title and interest in and to the Facility to the County, and the parties shall have no obligation or liability hereunder.

SECTION 3.04. ENVIRONMENTAL AUDIT.

(A) Within thirty days of the Effective Date and prior to beginning construction of the County Improvements, the County shall obtain and deliver a Phase I Environmental Audit for the Facility, Indicating that such property contains no Hazardous Substance in violation of Environmental Law.

(B) If the Phase I Environmental Audit shows the presence of any Hazardous Substance which is unacceptable to Colt, notice to that effect shall be given to the County within ten days after Colt's receipt of the Phase I Environmental Audit. Upon receipt of Colt's notice,

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the County shall notify Colt whether it elects to obtain a Phase II Environmental Audit for the Facility. If the County does not elect to obtain a Phase II Environmental Audit, Colt shall notify 'the County within ten days of the County's notice whether it elects to (1) accept the Phase I Environmental Audit without any County obligation for remediation, (2) terminate this Lease, whereupon the parties shall be relieved of any further obligation or liability to each other, or (3) obtain a Phase II Environmental Audit at its own expense. If Colt elects to obtain its own Phase II Environmental Audit, it shall notify the County within ten days of its receipt thereof whether it elects to accept the Phase I Enviromnental Audit without any County obligation for remediation or terminate this Lease, whereupon the parties shall be relieved of any further obligation or liability to each other.

(C) If the County elects to obtain a Phase II Environmental Audit, a copy shall be delivered to Colt upon its receipt and the parties shall meet within ten days to discuss the remediation cost. If the parties cannot agree upon a cost-sharing formula for the remediation, the County shall have no obligation to remediate the Hazardous Substance contamination. If the County elects to remediate, it shall notify Colt and the term of this Lease shall extended for the remediation period. If the County elects not to remediate, it shall notify Colt and Colt shall have ten days of the County's notice to accept the Phase II Environmental Audit without any County obligation for remediation or terminate this Lease, whereupon the parties shall be relieved of any further obligation or liability to each other.

SECTION 3.05. MOLD INSPECTION.

(A) Immediately following completion of the County Improvements, the County shall have a qualified expert take air quality and surface samples in any area of the interior or exterior of the Facility to determine evidence of mold or mold spores of any kind and level of toxicity. Samples will be sent for analysis to a qualified laboratory and a-copy of the laboratory analysis shall be delivered to Colt.

(B) If the laboratory analysis shows the presence of mold or mold spores, the parties shall meet within ten days to discuss the remediation cost. If the parties cannot agree upon a cost-sharing formula for the remediation, the County shall have no obligation to remediate the mold or mold spores. If the County elects to remediate, it shall notify Colt and the term of this Lease shall extended for the remediation period. If the County elects not to remediate, it shall notify Colt and Colt shall have ten days of the County's notice to accept the laboratory analysis without any County obligation for remediation or terminate this Lease, whereupon the parfies Shall be relieved of any further obligation or liability to each other.

SECTION 3.06. COUNTY IMPROVEMENTS.

(A) The parties acknowledge that Colt will be receiving $250,000 of State Funds for improvements to the Facility. Immediately upon receipt of the State Funds, Colt shall endorse the payment to the County. The County agrees to apply all of the State Funds to construction and installation of the County Improvements. County Improvements shall be completed in a good, workinanlike and lien-free manner. For the separate consideration of ten dollars and other valuable consideration paid to it by the County, receipt of which is hereby acknowledged, Colt agrees to indemnify, defend and hold the County, its officers, employees and agents harmless

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from and against all liabilities, losses, expenses, actions, demands and claims (including reasonable attorneys' fees) in connection with or arising out of any claim that Colt has failed to meet eligibility-requirements for the State Funds.

(B) The County shall select and engage qualified architects, engineers and other necessary professionals to prepare construction documents for the County Improvements. The County Improvements shall be constructed in a good, workmanlike and lien-free manner.

(C) As soon as reasonably practicable following the County's receipt of the State Funds, the County will begin construction and installation of the County Improvements and will use all reasonable efforts to proceed diligently to issuance of the County's Certificate of Substantial Completion, receipt of a confirming certificate from Colt's construction representative and completion of the Punch List, which shall occur not later than 180 days from the date construction begins.

SECTION 3.07. COLT IMPROVEMENTS.

(A) As soon as reasonably practicable following Colt's receipt of the County's Certificate of Substantial Completion and receipt of a confirming certificate from Colt's construction representative, Colt will begin construction ,and installation of any Colt Improvements required for immediate occupancy of the Facility and will use all reasonable efforts to proceed diligently to completion. Subject to force rnajeure, as described in the following subsection (F), Colt shall be operating the Facility for the purposes described in Section 3.08 on or prior to 34E1 1, 2012.

7un f; 14//1 k 7 7

(B) Colt will design and construct the Colt Improvements using its own funds, in compliance with all applicable County ordinances and codes and state and federal statutes, rules and regulations. Colt Improvements shall be completed in a good, workmanlike and lien-free manner.

(C) Colt shall 'select and engage qualified architects, engineers and other necessary professionals, and shall cause the preparation of construction documents for the Colt Improvements. The construction documents shall detail the requirements for the construction of the Colt Improvements, based on materials and systems selected by Colt, and shall be compliant with all codes, laws or regulations which have been enacted at the time of their preparation. Following preparation of the consttuction documents, Colt will provide a copy to the County Manager, or his designee, for revieW. If the County Manager, or his designee, fails to state his approval or disapproval of the construction documents, in writing, within ten business days of the date they are provided by Colt for review, such documents shall be deemed to have been approved. Construction of the Colt Improvements shall be in accordance with these construction documents as approved by Colt and the County Manager, or his designee.

(D) Colt shall obtain all necessary permits, approvals, licenses required for the construction, use and occupancy of the Colt Improvements. Promptly upon compliance with all applicable conditions of approval, all County permits required for construction of the Colt Improvements shall be granted to Colt. If required by Section 255.05, Florida Statutes, Colt shall provide, or cause the General Contractor to provide, a payment and performance bond.

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(E) Colt shall select and engage a General Contractor and will cause the General Contractor to actively solicit the participation of local subcontractors, and will pre-qualify such local subcontractors. The prequalification criteria shall be at the discretion of Colt, but shall include but not be limited to experience, financial resources, organization and personnel, equipment, past record or history of the person or entity. The General Contractor shall solicit bids or quotes for subcontract work from prequalified local subcontractors. Prequalified local subcontractors not submitting the lowest bid or quote, but whose bid or quote is within five percent of the lowest bid or quote, will be notified in writing by the General Contractor and given three business days to accept the subcontract at the lowest bid or quote received by the General Contractor.

(F) It is expressly understood and agreed by the parties that if Colt's performance related to the Colt Improvements is delayed by reason of war, civil commotion, strike or other employment action, act of God, governmental restrictions, regulations or interferences, fire or other casualty, court injunction, or any other act, event or circumstances beyond its reasonable control, then Colt's obligation to perform hereunder shall be extended for a period or periods equal to the cumulative duration of the force majeure, provided that Colt notifies the County, in writing, of the occurrence of any such cause which may hampef construction of the Colt Improvements and exert due diligence to remove such cause. Notwithstanding the foregoing, if commencement of the construction of the any Colt Improvements required for immediate occupancy of the Facility is delayed by a force majeure beyond 180 days following the Effective Date, this Lease may be immediately terminated by either party, upon providing written notice in the matter set forth in Section 3.15 hereof

(G) Upon receipt of a written request from the County, Colt shall assign in writing to the County all rights which Colt may then possess against (1) any parties who prepared the construction documents for the Colt Improvements, and (2) all contractors, subcontractors and material suppliers for the Colt Improvements, reserving to Colt the right to subsequently prosecute any claims against said parties that may arise as a result of any claims, action, loss, damage or expense sustained by Colt arising out of any of the construction documents for the Colt Improvements or the construction of the Colt Improvements.

(H) For the separate consideration of ten dollars and other valuable consideration paid to it by the County, receipt of which is hereby acknowledged, Colt agrees to indemnify, defend and hold the County, its officers, employees and agents harmless from and against all liabilities, losses, damages (including theft and loss of use), expenses, actions, demands and claims (including reasonable attorneys' fees) in connection with or arising out of any physical injury or alleged physical injury to persons (including death), or damages or losses or alleged damages or losses to tangible property or the use or loss of use thereof, sustained or alleged to have been sustained in connection with or to have arisen out of the design or construction of the Colt Improvements except to the extent caused by the County's willful misconduct or gross negligence.

SECTION 3.08. USE OF THE FACILITY. Colt shall use the Facility solely for the purposes associated with the operation of a regional headquarters and firearms manufacturing facility, an ammunition testing, storage and distribution warehouse, a retail store engaged in the sale of fire arms and related products, and a firearms museum, and for no other purpose without

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the prior written consent of the County. Said use shall also include a gun range, which shall be for the exclusive -use of Colt and shall not be open to the public. In no event shall the Facility be used for any purpose which would constitute a public or private nuisance or waste. Colt shall not permit any unlawful occupation, business or trade to be conducted on the Facility or any use to be made thereof contrary to applicable legal requirements, including zoning requirements.

SECTION 3.09. OPERATION AND MAINTENANCE. Except as provided herein, upon possession of the Facility as set forth in Section 3.02 hereof, Colt agrees to assume all responsibility for the maintenance and operation of the Facility. Colt shall maintain, in good order and condition, all interior and exterior portions of the Facility, and all parts thereof, in a safe, structurally sound, attractive, clean and orderly condition, and shall ensure that all portions of the Facility are free of dirt, rubbish, graffiti, debris and unlawful obstruction. In addition to the County and Colt Improvements being made pursuant to Sections 3.06 and 3.07, when necessary to maintain the Facility in first-class condition, Colt shall make any renewals, replacements, restorations, alterations or improvements required to continue utilizing the Facility for the purposes described in Section 3.08. In that event, if and only as required by Section 255.05, Florida Statutes, Colt shall provide, or cause its contractors to provide, a payment and performance bond.

SECTION 3.10. ADVERTISING AND SIGNAGE. During the term of this Lease, Colt shall be permitted to utilize such space that is designated by the County within the Facility to advertise. At a minimum, the County agrees to provide a street sign, of customary size and format, identifying the driveway as "1 Colt Way." Colt may construct or install a monument sign at the Facility that meets the requirements set forth in Chapter 15 of the Osceola County Land Development Code. The County will promptly consider any application made by Colt for a variance from the requirements of Chapter 15. The substance of all other signage must be approved jointly by Colt and the County Manager prior to purchase or installation to assure continuity, consistency and established standards.

SECTION 3.1L COMPLIANCE WITH LEGAL REQUIREMENTS. During the term of this Lease, Colt shall comply with and cause the Facility to be in compliance with (A) all laws, ordinances and regulations, and other governmental rules, orders and determinations, whether or not presently contemplated applicable to the Facility or the uses conducted on the Facility, including without limitation, the Americans With Disabilities Act and the Florida Ainericans With Disabilities Accessibility Implementation Act, (B) the provisions of any insurance policies required to be maintained by Colt with respect to the Facility, and (C) the terms of any easements, covenants, conditions and restrictions affecting the Facility which are permitted encumbrances or are created with written consent of the County after the date of this Lease. If any additions, alterations, changes, repairs or other work of any nature, structural or otherwise, shall be required or ordered or become necessary at any time during the term because of any of these requirements, the entire expense of the same, irrespective of when the same shall be incurred or become due, shall be the sole liability of Colt.

SECTION 3.12. HAZARDOUS SUBSTANCES.

(A) Colt hereby agrees that Colt shall not use, generate, manufacture, refine, produce, process, store or dispose of, on, under or about the Facility or transport to or from the Facility in

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the, future for the purpose of generating, manufacturing, refining, producing, storing, handling, transferring; processing or transporting Hazardous Substances, except in compliance with applicable. Environmental Law. Furthermore, Colt shall, at its own expense, procure, maintain in effect and comply with all conditions of any and all permits, licenses and other governthental and regulatory approvals required for the storage or use by Colt of Hazardous Substances on the Facility, including without limitation, discharge of (appropriately treated) materials or wastes into or through any sanitary sewer serving the Facility.

(B) If a Colt Contamination shall occur at any time during the term of the Lease, then Colt, at its sole cost and expense, shall promptly and diligently remove such Hazardous Substances from the Facility or the groundwater underlying the Facility. However, Colt shall not take any required remedial action in response to any Colt Contamination in or about the Facility or enter into any settlement agreement, consent, decree or other compromise in respect to any claims relating to any Colt Contamination without first notifying the County of Colt's intention to do so and affording the County the opportunity to appear, intervene or otherwise appropriately assert and protect the County's interest with respect thereto. Notwithstanding the foregoing, Colt may take remediation action without providing the County with prior written notice of the required action if such action is necessary in order to prevent imminent danger to property or persons. In addition to all other rights and remedies of the County hereunder, if Colt does not promptly and diligently take all steps to prepare and obtain all necessary approvals of a remediation plan for any Colt Contamination, and thereafter commence the required remediation of any Hazardous Substances released or discharged in connection with a Colt Contamination within thirty days after the County has reasonably approved Colt's remediation plan and all necessary approvals and consents have been obtained and thereafter continue to prosecute said remediation to completion in accordance with the approved reniediation plan, then the County, at its sole discretion, shall have the right, but not the obligation, to cause said remediation to be accomplished, and Colt shall reimburse the County within fifteen business days of the County's demand for reimbursement of all amounts reasonably paid by the County (together with interest on said amounts at the Prime Rate until paid), when said demand is accompanied by proof of payment by the County of the amounts demanded. Colt shall promptly deliver to the County copies of hazardous waste manifests reflecting the legal and proper disposal of all Hazardous Substances removed from the Facility as part of Colt's remediation of any Colt's Contamination.

(C) Colt shall cause any and all Hazardous Substances removed from the Facility as part of the requireol remediation of Colt's Contamination and shall be removed and transported solely by duly licensed haulers to duly licensed facilities for final disposal of such materials and wastes.

(D) Colt shall cause any and all Hazardous Substances to be removed from the Facility prior to the termination of this Lease and shall be removed and transported solely by duly licensed haulers to duly licensed facilities for final disposal of such materials and wastes.

(E) Each party hereto shall immediately notify the other party in writing of: (1) any enforcement, clean-up, removal or other governmental or regulatory action instituted, contemplated or threatened concerning the Facility pursuant to any Environmental Law; (2) any claim made or threatened by any person against the notifying party or the Facility relating to damage contribution, cost recovery, compensation, loss or injury resulting from or claimed to

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result from any Hazardous Substance on or about the Facility; and (3) any reports made to any environmental agency arising out of or in connection with any Hazardous Substance in or removed from the Facility including any complaints, notices, warnings or asserted violations in connection therewith, all upon receipt by the notifying party of actual knowledge of any of the foregoing matters. The notifying party shall also supply to the notice recipient as promptly as possible, and in any event within five business days after notifying party first receives or sends the same, with copies of all claims, reports, complaints, notices, warnings or asserted violations relating in any way to the Facility or Colt's use thereof.

(F) Colt shall indemnify, defend (by counsel acceptable to the County in its reasonable judgment), protect, and hold the County, its employees, agents, attorneys, officers, successors and assigns, free and harmless from and against any and all claims, actions, causes of action, liabilities, penalties, forfeitures, damages, losses or expenses (including, without limitation, attorneys' fees and costs through litigation and all appeals) or death of or injury to any person or damage to any property whatsoever, arising from or caused in whole or in part, directly or indirectly by (1) any Colt Contamination, (2) Colt's failure to comply with any Environmental Law with respect to the Facility, or (3) a breach of any covenant, warranty or representation of Colt under this Section. Colt's obligations hereunder shall include, without limitation, and whether foreseeable or unforeseeable, all costs of any required or necessary repair, clean-up or detoxification or decontamination of the Facility, and the preparation and implementation of any closure, remedial action or other required plans in connection therewith. For purposes of the indemnity provisions hereof, any acts or omissions of Colt, or by employees, agents, assignees, lessees, sublessees, pennittees, contractors or subcontractors of Colt or others acting for or on behalf of Colt (whether or not they are negligent, intentional, willful or unlawful) shall be strictly attributable to Colt; provided however, that in no event shall the acts or omissions of the County or the County's employees or agents be attributable to Colt.

(G) All representations, warranties, obligations and indemnities made or given under this Section shall survive the expiration or earlier termination of this Lease.

SECTION 3.13. LIENS AND ENCUMBRANCES.

(A) This Lease strictly forbids the filing of any liens whatsoever by any contractor, subcontractor, materialmen, laborer or other person for any work performed by or at the request of Colt in or about the Facility or by any party providing financing to Colt. Notice of such prohibition may be given to such persons in a memorandum of lease recorded in the public records of Osceola County. The purpose of this Section is to expressly exculpate and insulate the County from any liability whatsoever for the cost of any such work performed by or at the request of Colt. The interest of the County in the Facility shall not be subject to foreclosure with respect to any such liens. In addition, Colt shall cause any lien filed against the Facility in violation of this Section to be released and discharged within ten (10) days after the County's written demand therefore and Colt shall indemnify and hold the County harmless from and against any such lien and any cost, damages, charges and expenses incurred in connection with any such lien, including, without limitation, attorney fees.

(B) Nothing contained in this Section shall authorize Colt to do any act which may create or be the foundation for any lien, mortgage or other encumbrance upon the reservation or

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other estate of the County, or of any interest of the County in the Facility, or in the Facility or improvements thereof;- it being agreed that should Colt cause any alterations, changes, additions, improvements or repairs to be made in the Facility, or cause materials to be furnished or labor to be performed therein, the County shall not, under any circumstances, be liable for the payment of any expenses incurred or for the value of any work done or material furnished to the Facility, or any part thereof. Colt shall, upon request of the County, deliver such documents as may be required by the County in order to effectuate the lien protection required by this Section. Colt shall inform every service or material provider of the foregoing provision prior to contracting with any of them for goods or services.

SECTION 3.14. TAXES ON LEASEHOLD OR PERSONALTY.

(A) Colt shall pay, prior to delinquency, all or its prorated share (if such obligation relates to a partial Lease year) of (1) all taxes, assessments, levies, fees, fines, penalties and all other governmental charges, general and special, ordinary and extraordinary, foreseen and unforeseen, which are during the term hereof, imposed or levied upon or assessed against (a) the Facility, or any portion thereof, and any improvements now or hereafter located on the Facility, or (b) this Lease, the leasehold estate hereby created or which arises in respect of the operation, possession or use of the Facility; and (2) all gross receipts or similar taxes (i.e., taxes based upon gross income which fail to take into account all customary deductions (e.g., depreciation and interest) relating to the Facility) imposed or levied upon, assessed against or measured by any rent. If Colt fails to pay any of the foregoing before they become delinquent, the County, after notice to Colt, may pay such delinquent taxes, assessments, levies, fees, fines, penalties and governmental charges, and all expenditures and costs incurred thereby shall be payable as additional rent hereunder within fifteen days after such notice to Colt. Colt shall pay all taxes and assessments in connection with the Facility, and shall provide the County with copies of all paid bills for taxes and assessments no later than thirty days after the date payment was due. Should Colt fail to pay any taxes, assessments, charges or any other amounts required to be paid by Colt pursuant to this Section, such failure shall constitute an Event of Default under this Lease and the County, in addition to any other right provided to the County under this Lease, may pay any such tax, assessment, charge or other amount and the sums so paid by the County shall be paid by Colt to the County as additional rent and shall accrue interest at the prime rate until paid by Colt. Colt's obligations under this Section shall survive the expiration or termination of this Lease.

(B) All real estate taxes and assessments which are due and payable within one year after the expiration of the Lease term shall be prorated as of the date of expiration of the Lease tern, on the basis of the fiscal year with respect to which such taxes or assessment are assessed. Colt shall be responsible for and shall pay the portion of such taxes relating to the period through and including the expiration of the Lease term.

SECTION 3.15. RENT AND UTILITIES.

(A) Colt shall pay rent to the County, payable in advance and without demand, on the dates and in the amounts, set fortyi below:

§ 147/11k , , (1) Octoben-1-5', 2011, the sum of One Dollar ($1);

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April 15, 2012, the sum of One Dollar ($1)-;

April 15, 2013, the sum of One Dollar ($1);

April 15, 2014, the sum of One Dollar ($1);

April 15, 2015, the sum of One Dollar ($1);

(6) April 15, 2016, July 15, 2016, October 15, 2016 and January 15, 2017, the sum of Twenty Seven Thousand Dollars ($27,000) each payment, for a total of One Hundred Eight Thousand ($108 .,000);

(7) April 15, 2017, July 15,2017, October 15, 2017 and January 15, 2018, the sum of Twenty Seven Thousand Dollars ($27,000) each payment, for a total of One Hundred Eight Thousand ($108,000);

(8) April 15, 2018, July 15, 2018, October 15, 2018 and January 15, 2019, the sum of Twenty Seven Thousand Dollars ($27,000) each payment, for a total of One Hundred Eight Thousand ($108,000);

(9) April 15, 2019, July 15, 2019, October 15, 2019 and January 15, 2020, the sum of Twenty Seven Thousand Dollars ($27,000) each payment, for a total of One Hundred Eight Thousand ($108,000);

(10) April 15, 2020, July 15, 2020, October 15, 2020 and January 15, 2021, the sum of Twenty Seven Thousand Dollars ($27,000) each payment, for a total of One Hundred Eight Thousand ($108,000);

(11) April 15, 2021, July 15, 2021, October 15, 2021 and January 15, 2022, the sum of Twenty Seven Thousand Dollars ($27,000) each payment, for a total of One Hundred Eight Thousand ($108,000); and

(12) April 15, 2022, July 15, 2022, October 15, 2022 and January 15, 2023, the sum of Twenty Seven Thousand Dollars ($27,000) each payment, One Hundred Eight Thousand ($108,000).

(B) Colt at its sole cost and expense shall obtain and promptly pay for all utility, communication and other services furnished to or consumed within the Facility following the date on which Colt takes possession of the Facility, including but not limited to, electricity, cable, gas, water, sewer, heat, telephone, janitorial, garbage collection and all charges related to any of these services, including tap-in, connection or impact fees.

SECTION 3.16. INDEMNIFICATION. For the separate consideration of ten dollars and other valuable consideration paid to it by the County, receipt of which is hereby acknowledged, Colt agrees to indemnify, defend, and hold the County, its commissioners, officers, employees and agents harmless from and against any and all claims, demands, civil or criminal actions (including enforcement proceedings initiated by any government agency), penalties, suits, proceedings and liabilities (including the cost of defense, settlement, appeal and

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reasonable attorney's fees) and costs and expenses related thereto, that the County, its officers, employees or agents may have alleged against them, incur, become responsible for, or pay out for any reason related (1) to the operation of the Facility during the term of this Lease, or (2) any• document related to the design or construction of any Colt Improvements, except in the event of the County's willful misconduct or gross negligence. The provisions of this Section are intended to be severable from all other provisions of this Lease and to survive the termination of this Lease and not be merged into any termination of this Lease.

SECTION 3.17. INSURANCE.

(A) At all times during the term of this Lease, Colt shall:

(1) maintain commercial general liability insurance, including products and completed operations, bodily injury and property damage liability, contractual liability, independent contractors' liability and personal and advertising injury liability against claims occurring on, in, or about the Facility, or otherwise arising under this Lease;

(2) maintain umbrella or excess liability insurance;

(3) maintain commercial automobile liability insurance, including coverage for the operation of owned, leased, hired and non-owned vehicles;

(4) maintain appropriate workers compensation and employer's liability insurance as shall be required by and be in conformance with the laws of the State of Florida; and

(5) maintain professional liability insurance and self-insured employment practices liability coverage.

(B) Such liability insurance shall be maintained in the following minimum amounts, and such coverage shall be solely for the Facility:

(1) Commercial General Liability, which shall include coverage for damage to rented/leased premises:

$1,000,000 per occurrence

$1,000,000 persOnal and advertising injury

$1,000,000 products-completed operations aggregate

(2) Automobile Liability:

$1,000,000 per accident (PI and PD combined single limit)

(3) Umbrella or Excess Liability:

$5,000,000 per occurrence and aggregate

(4) Workers Compensation:

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As required by law

(5)

Professional Liability/Errors & Omissions:

$1,000,000 each occurrence/aggregate — to include entity coverage

(C) At all times during the term of this Lease, Colt shall maintain insurance against loss or damage by fire, and such other risks and hazards as are insurable under then available Standard forms of fire insurance policies with extended coverage, to the Facility for the full insurable value thereof.

(D) All such insurance shall name the County as an additional insured and shall be written in form and substance satisfactory to the County in its reasonable judgment by •an insurance company of recognized responsibility authorized to do business in the State of Florida; provided that insurance companies with a rating from A. M. Best Company of A-7 or better shall be deemed satisfactory. Upon failure of Colt to procure, maintain, and pay all premiums therefor, the County may, at its option, do so, and Colt agrees to pay the cost thereof to the County upon demand, together with interest thereon at the prime rate. Notwithstanding the foregoing, the County shall provide 30 days' written notice to Colt of its intent to procure insurance upon Colt's failure to do so, during which period Colt shall be entitled to cure its failure; provided however, that no notice or opportunity to cure shall be required if insurance for the Facility has lapsed. Colt shall furnish evidence of such insurance to the County. The certificate shall contain a standard insurance industry statement prohibiting cancellation, termination, or modification of the policy or reduction of coverage without first giving the County thirty days prior written notice of such proposed action, except in the event of non-payment of the premium, for which the County shall be given 10 days written notice of such proposed action.

SECTION 3.18. DAMAGE OR DESTRUCTION. Upon possession of the Facility by Colt as set forth in Section 3.02 above, if the Facility or any part thereof is damaged or destroyed by fire or other casualty required to be covered by the insurance described in Section 3.17, then Colt shall repair, restore, replace or rebuild the Facility as nearly as is reasonably possible to the condition and character of the Facility immediately prior to the occurrence of the damage or destruction, subject to the following conditions precedent: (A) Colt receives insurance proceeds in an amount sufficient to cover at least ninety percent of the cost to rebuild and replace the Facility; and (B) the repair of the Facility is not reasonably anticipated to exceed nine months. If the conditions set forth in the foregoing clauses (A) and (B) are not satisfied, Colt shall net be required to repair any damage or destruction of the Facility and if Colt elects 'not to repair the Facility then either party may terminate this Lease by providing notice, in writing, to the other party within ninety days after the occurrence of such damage or destruction; provided however, that Colt shall have no right to tenninate this Lease pursuant to this Section if it is in default of this Lease as of the date of the casualty. This Lease shall then terminate on the date specified in the notice, except as provided below and except with respect to obligations and liabilities of the County and Colt under this Lease that have arisen on or before such date of termination. In the event of termination, the insurance proceeds payable in connection with the damage or destruction of the Facility shall be payable to the County. Upon this termination,

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regardless of the amount of proceeds available, Colt shall satisfy and cause to be released any liens or other encumbrances placed or suffered to be placed on the Facility by Colt.

SECTION 3.19. DEFAULTS AND REMEDIES.

(A) Any one or more of the following events shall constitute an event of default under this Lease by Colt (herein each an "Event of Default"): (1) Colt fails to perform or to observe any covenant or condition to be performed or complied with by Colt under this Lease, and the failure continues for thirty days after written notice by the County to Colt, or, if the default .complained of is not a monetary default and is of such a nature that it cannot reasonably be completely cured or remedied within such 30-day period, Colt fails to commence to cure the default during the 30- day period, or does not thereafter diligently prosecute such remedy or cure to completion; (2) Colt files or there is filed against Colt a petition in bankruptcy or a petition or answer seeking reorganization under the Federal Bankruptcy Code or any other applicable statute; (3) an order is entered adjudicating Colt bankrupt or approving an involuntary petition seeking a reorganization of Colt under the Federal Bankruptcy Code or any other applicable statute or appointing a receiver, trustee or conservator for all or any substantial part of the property of Colt, and the order is not vacated or stayed within one hundred eighty days of entry; or (4) this Lease or the Facility or any part of the Facility is taken upon execution or by other process of law directed against Colt, or is taken upon or subjected to any attachments by any creditor of Colt or claimant against Colt, and the attachment is not discharged within thirty days after its levy. The County shall have the right, at its option, then or at any time while the Event of Default continues (following the expiration of any applicable notice and cure period), to give a written notice specifying a date on which this Lease shall terminate, and on that date, subject to any provisions of this Lease, relating to the survival of Colt's obligations, this Lease shall terminate.

(B) In the Event of a Default by Colt, the County shall have the following remedy: the right, at its option, then or at any time while the default continues to give a written notice specifying a date on which this Lease shall terminate (which date shall be no earlier than 90 days from the date of such notice), and on that date, subject to any provisions of this Lease relating to the survival of Colt's obligations, this Lease shall terminate. Upon such termination, the County may re-enter and take complete and peaceful possession of the Facility and, with or without process of law, remove all persons and all furniture, fixtures, equipment and other personal property located on the Facility and owned or leased from third parties by Colt, by force or otherwise, without being liable in damages for these actions, in which event Colt shall peacefully and quietly yield up and surrender- the Facility to the County.

(C) No waiver or assent, express or implied, to any breach of Colt's covenants hereunder shall be deemed a waiver of any breach of any other covenants under this Lease or a Waiver of any succeeding breach of the same covenants. No waiver shall be deemed to have been given by the County's failure to enforce the terms of this Lease strictly, unless such waiver shall be in writing and shall state the specific act or failure which the County has agreed not to treat as an Event of Default.

(D) If an Event of Default occurs as a result of Colt's failure to pay any taxes, assessments or other charges, or maintain required insurance coverages, the County, without waiving or releasing any obligation or Event of Default, may (but shall be under no obligation

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to) make the payment for the account and at the expense. of Colt. All sums so paid by the County, together with interest thereon at the prime rate, shall constitute additional rent and shall be paid by Colt to the County on demand.

(E) If an Event of Default occurs as a result of Colt's failure to hire and to maintain a minimum of 63 full time employees, at an average wage of $48,225 (excluding benefits), within 36 months after Colt takes possession of the Facility as set forth in Section 3.02 above, or if after 36 months following the date Colt takes possession of the Facility, Colt fails to maintain said employee and salary commitment for longer than 90 days, after notice from the County within the time periods specified in the foregoing subsection (A), Colt shall pay the County the sum of Fifty Thousand Dollars ($50,000.00), which sum shall constitute additional rent and shall be paid by Colt on demand.

(F) If the County shall violate, neglect or fail to perform or observe any of the representations, covenants, provisions or conditions contained in this Lease on its part to be performed or observed, which default continues for a period of more than thirty days after receipt of written notice from Colt specifying such default, Colt may, at its option (in addition to all other rights and remedies provided Colt at law, in equity or hereunder), incur any reasonable expense necessary to perform the obligations of the County specified in such notice and bill the County for the costs thereof and shall immediately be reimbursed by the County for its expenditures. In addition, Colt shall have the right, at its option, in the event of a default beyond any applicable grace -period by the County to give a written notice specifying a date on which this Lease shall terminate and on that date this Lease shall terminate.

SECTION 3.20. ENTRY AND INSPECTION. The County shall have the right, upon 24 hours' prior notice (except in case of an emergency in which event no notice shall be required), to enter the Facility for the purpose of (A) examinations or inspections of the same, (B) making such repairs or alterations therein as permitted by County pursuant to the terms of this Lease or as County may reasonably deem necessary to preserve the value of the Facility and (C) during the last 180 days of the Lease term only, showing the Facility to prospective tenants or purchasers. Such entry shall not be deemed to be an actual or constructive eviction.

SECTION 3.21. SURRENDER. At the expiration or earlier termination of the Lease term, Colt shall yield the Facility to the County in good order and repair, and licenses granted herein to Colt shall automatically terminate and Colt shall execute a document, to be recorded in the public records, acknowledging the termination of this Lease and the easements and licenses granted herein. Except as otherwise provided in this Lease, the Facility and any other leasehold improvements shall become the sole property of the County at the expiration of the Lease term without any compensation to Colt and free and clear of any right, title, interest, claim or demand of Colt or of anyone claiming through or under Colt. Colt agrees to execute such documents and instruments of conveyance as may be required by the County to confirm such ownership in the County. If Colt is not in default, upon expiration or earlier termination of this Lease, Colt may remove any of Colt's trade fixtures, equipment, furniture, furnishings, and other personal property from the Facility and Colt shall repair any damage which may result to the Facility from such removal; provided, however, Colt shall not remove any trade fixtures or equipment without County's prior written consent if the removal of the fixtures or equipment will impair the structure of any building. In the event Colt fails to remove those items, the items shall

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be deemed abandoned 'and shall be the property of the County. On or before the expiration or termination of this Lease, Colt shall cause any mortgages, deeds of trust, liens or encumbrances created by, through or under Colt to be fully released and discharged.

SECTION 3.22. HOLDING OVER A holding over beyond the expiration of the Lease term, whether with the County's written consent or without the County's consent, shall operate as an extension of this Lease on a month to month basis on the same terms and conditions in effect immediately prior to the expiration. If Colt holds over with the written consent of the County, then the extended term may be terminated either by the County or Colt by giving thirty days written notice to the other. Nothing contained in this Section however, shall be construed as a consent by the County to any hold over by Colt, and the County expressly reserves the right to require Colt to surrender possession of the Facility to the County upon expiration or other termination of this Lease, and the provisions of this Section shall not be deemed to limit or constitute a waiver of any other rights or remedies of the County provided herein or at law if Colt holdovers without the County's written consent. If Colt fails to surrender the Facility upon termination or expiration of this Lease and the County has not consented in writing to such holdover, in addition to any other remedies available to the County, Colt shall defend, indemnify and hold County harmless from all loss costs, including attorney's fees and liability resulting from such failure, including without limitation, any claims by a successor of Colt founded upon such failure to surrender.

SECTION 3.23. SURVIVAL OF OBLIGATIONS. All obligations of Colt hereunder not fully performed as of the expiration or earlier termination of this Lease shall survive the expiration or earlier termination of this Lease, including without limitation, all obligations concerning and the payment of expenses and charges required to be paid hereunder by Colt for the period prior to the expiration or earlier termination of this Lease.

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ARTICLE IV

GENERAL PROVISIONS

SECTION 4.01. NOTICE AND CURE. In the event any party breached the terms and provisions of this Lease, a non-defaulting party shall not exercise any remedies for such breach unless the non-defaulting party has notified the defaulting party in writing of the breach and demanded compliance with this Lease. Unless a longer notice and cure period is specified elsewhere in this Lease, the party who has breached this Lease shall remedy its breach within five business days of receipt of written notice thereof, unless such breach is susceptible of cure and such cure cannot, with diligence, be completed within the five business day period, in which additional time shall be afforded, provided cure is begun within the five business day period and diligently and continuously thereafter prosecuted to completion, provided that in no event shall such additional time exceed thirty days from the receipt by the defaulting party of written notice of the breach. If a cure is not completed after notice and within the allowed cure period, a non-defaulting party may declare a breaching party in default and may exercise its remedies as provided in this Lease.

SECTION 4.02. RESOLUTION OF DISPUTES. It is the desire and intent of the parties to avoid, if possible, the expense and delay inherent in litigation; therefore, the parties agree that whenever any party cannot resolve an issue with the other party, the affected parties will engage in the alternative dispute resolution process described below prior to resorting to litigation.

(A) Either party may initiate the dispute resolution process by providing written notice to the other party. After transmittal and receipt of a notice specifying the area or areas of disagreement, the parties agree to meet at reasonable times and places, as mutually agreed upon, to discuss the issues.

(B) If discussions between the parties fail to resolve the dispute within sixty calendar days of the notice described in the foregoing subsection (A), the parties shall appoint a mutually acceptable neutral third party to act as a mediator. If the parties are unable to agree upon a mediator, the County will request appointment of a mediator by the Chief Judge of the Circuit Court of the Ninth Judicial Circuit in and for the County. The mediation contemplated by this subsection is intended to be an informal and non-adversarial process with the objective of helping the parties reach a mutually acceptable and voluntary agreement. The decision-making shall rest solely with the parties. The mediator shall assist the parties in identifying issues, fostering joint problem-solving, and exploring settlement alternatives. It is understood that any settlement may require approval of the Osceola County Commission.

(C) If the parties are unable to reach a mediated settlement within one hundred twenty calendar days of the mediator's appointment, any party may terminate the settlement discussions by written notice to the other party. In such event, any party may initiate litigation within one hundred twenty calendar days of the notice terminating the settlement discussions. Failure by the party initiating the dispute resolution procedure to commence litigation within the one hundred twenty day period shall be deemed to constitute an acceptance of the interpretation or performance of the other party.

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SECTION 4.03. ASSIGNMENT. Neither party shall be permitted to assign, nor transfer any of its rights and obligations under this Lease without the prior written consent of the other party, which shall not be withheld unreasonably. No such assignment by Colt shall become effective unless (A) the proposed assignee is a duly organized entity authorized to transact business in the State of Florida; and (B) the proposed assignee specifically agrees, in writing, to be bOund by all the provisions of this Lease. No such assignment shall operate to release Colt from any of its obligations under this Lease.

SECTION 4.04. TIME OF THE ESSENCE. Time is of the essence with respect to all provisions of this Lease.

SECTION 4.05. EXTENSION OF TIME PERIODS. In the event that the last day of any period of time on any date specified in this Lease shall fall on a weekend or legal holiday, or any day when Colt's or the County's banks or other governmental offices in Osceola County are closed, such period of time shall be extended through the end of the next work day following, or the next date during which such governmental offices and banks are open.

SECTION 4.06. NO JOINT VENTURE. Nothing in this Lease shall be deemed to constitute the creation of a joint venture or partnership relationship between the County and Colt.

SECTION 4.07. NON-WAIVER. The failure of any party to insist upon another party's compliance with its obligations under this Lease in any one or more instances shall not operate to release such other party from its duties to comply with such obligations in all other instances.

SECTION 4.08. COUNTERPARTS. This Lease may be executed in multiple counterparts. Each such counterpart shall be deemed an original of this Lease, so that in making proof of this Lease, it shall only be necessary to produce or account for one such counterpart.

SECTION 4.09. ENTIRE AGREEMENT. This Lease, including the Appendices, •which are incorporated herein by reference, constitutes the entire agreement among the parties pertaining to the subject matter hereof, and supersedes all prior and contemporaneous agreements, understandings, negotiations and discussions of the parties, whether oral or written, and there are no warranties, representations or other agreements between the parties in connection with the subject matter hereof, except as specifically set forth herein.

SECTION 4.10. BINDING EFFECT. This Lease shall be binding upon and inure to the benefit of the respective successors and assigns and, as applicable, to heirs and legal representatives of the parties hereto; provided however, that the Lease shall not inure to the benefit of any assignee of Colt pursuant to an assignment which is not in compliance with the terms .of the Lease.

SECTION 4.11. AMENDMENTS AND WAIVERS. No amendment, supplement, modification or waiver of this Lease shall be binding unless executed in writing by both parties hereto. No waiver of any of the provisions of this Lease shall be deemed or shall constitute a waiver of any other provision of this Lease, whether or not similar, unless otherwise expressly provided.

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SECTION 4.12. NOTICES TO PARTIES. Whenever this Lease requires or permits any consent, approval, notice, request, proposal, or demand from one party to another, the content, approval, notice, request, proposal, or demand must be in writing to be effective and shall be delivered to and received by the party intended to receive it (A) by hand delivery to the person(s) hereinafter designated, or (B) by overnight hand delivery addressed as follows, or (C) through the United States Mail, postage prepaid, certified mail, return-receipt requested, or (D) delivered and received by facsimile telephone transmission or other electronic transmission (provided that an original of the electronically transmitted document is delivered within five days after the document was electronically transmitted) upon the date so delivered to and received by the person to whom it is at the address set forth opposite the party's name below:

To the County:

With a Copy to:

To Colt:

Osceola County Manager 1 Courthouse Square, Suite 4700 Kissimmee, FLORIDA 34741 Phone: (407) 742-2385 Fax: (407) 742-3291

Osceola County Economic Development Dept. 3 Courthouse Square, 2nd Floor Kissimmee, Florida 34741

Merrick Alpert SVice President Colt's Manufacturing Company LLC 545 New Park Avenue West Hartford, Connecticut 06110 Phone: (860) 236-6311 Fax: (860) 244-1442

Any of the foregoing parties may, by notice in writing given to the other, designate any further or different addresses to which subsequent notices, certificates or other communications shall be sent. Any notice shall be deemed given on the date such notice is delivered by hand or facsimile transmission or three days after the date mailed.

SECTION 4.13. SEVERABILITY. In the event any one or more of the provisions contained in this Lease shall for any reason be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provision hereof, and this Lease shall be revised so as to cure such invalid, illegal or unenforceable provision to carry out as nearly as possible the original intent of the parties.

SECTION 4.14. GOVERNING LAW AND VENUE. This Lease and all agreements entered into in connection herewith will be performed in Osceola County. The laws of Florida shall govern the validity, construction, enforcement and interpretation of this Lease. In the event of litigation among the parties hereto, their successors or assigns, with regard to this Lease and any subsequent supplementary agreements or amendments, venue shall lie exclusively in Osceola County.

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SECTION 4.15. LITIGATION.

(A) In any action at law or in equity between the parties hereto occasioned by a default hereunder, the prevailing party shall be entitled to collect its reasonable attorneys fees actually incurred in the action from the non-prevailing party. As used herein, the term "prevailing party" shall mean the party who receives substantially the relief sought. If the prevailing party utilizes "in-house" counsel, such party's reasonable costs, expenses and overhead for the time expended by the prevailing party for such in-house counsel in the aforementioned action shall be recoverable by the prevailing party in the same manner as other attorneys' fees.

(B) Each party hereby knowingly, voluntarily and intentionally waives the right to a trial by jury with respect to any litigation (including but not limited to any counterclaims, cross claims or third party claims), whether now existing or hereafter arising, and whether sounding in contract, tort, equity or otherwise, regardless of the cause or causes of action, defenses or counterclaims alleged or the relief sought by any party, and regardless of whether such causes of action, defenses or counterclaims are based on, or arise out of, under or in connection with this agreement or its subject matter, out of any alleged conduct or course of conduct, dealing or course of dealing, statement (whether verbal or written), or otherwise. Any party hereto may file a copy of this agreement with any court as conclusive evidence of the consent of the parties hereto to the waiver of any right they may have to trial by jury.

SECTION 4.16. RADON DISCLOSURE.

(A) Radon is a naturally occurring radioactive gas that, when it has accumulated in a building in sufficient quantities, may present health risks to persons who are exposed over time. Levels of radon that exceed federal and state guidelines have been found in buildings in Florida. Additional information regarding radon and radon testing may be obtained from the county public health unit.

(B) Within thirty days of the Effective Date and prior to beginning construction of the County Improvements, the County shall have a qualified expert take air quality samples in any area of the interior or exterior of the Facility to determine the presence and level, if any, of radon gas.

(C) Tithe report shows the presence of radon, the parties shall meet within ten days to discuss the remediation cost. If the parties cannot agree upon a cost-sharing formula for the remediatibn, the County shall have no obligation to remediate the radon. If the County elects to remediate, it shall .notify Colt and the term of this Lease shall extended for the reniediation period. If the County elects not to remediate, it shall notify Colt and Colt shall have ten days of the County's notice to accept the report without any County obligation for remediation or terniinate- this Lease, whereupon the parties shall be relieved of any further obligation or liability to each other.

SECTION 4.17. INDEPENDENT CONTRACTOR. This Lease does not create an employee/employer relationship between the parties. It is the parties' intention that Colt, its employees, representatives, volunteers and the like, will be an independent contractor and not an

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employee of the County for all purposes, including but not limited to, the application of the following as amended: the Fair Labor Standards Act, minimum wage and overtime payments, the Federal Insurance Contribution Act, the Social Security Act, the Federal Unemployment Tax Act, the provision of the Internal Revenue Code, the State of Florida revenue and taxation laws, the State of Florida Worker's Compensation laws, the State of Florida Unemployment Insurance laws and the Florida Retirement System Benefits. Colt will retain sole and absolute discretion in the judgment of the manner and means of carrying out the activities and responsibilities of Colt hereunder.

SECTION 4.18. CONFLICT OF INTEREST. Colt warrants that Colt has not employed or retained any company or person, other than bona fide employees, consultants or agents working solely for Colt, to solicit or secure this Lease, and that Colt has not paid or agreed to pay any person, company, corporation, individual or firm any fee, commission, percentage, gift or any other consideration, contingent upon or resulting from the award or making of this Lease. For the breach or violation of this Section, the County shall have the right to terminate this Lease immediately and without liability.

SECTION 4.19. REMEDIES. If Colt fails to vacate the Facility upon natural expiration or termination of this Lease, the County shall be entitled to exercise the eviction procedures set forth in Chapter 83, Florida Statutes, in addition to the other remedies expressly provided for in this Lease.

SECTION 4.20. EXPANSION. The County acknowledges that in the future, Colt may want to explore the possibility of expanding its operations beyond the Facility and on to the County owned property located at 1097 Shady Lane, Kissimmee, Florida 34744. The property is currently being utilized for Osceola Fire Station 63, however, County will utilize its best efforts to notify Colt of any leasing or purchasing opportunities that may arise.

SECTION 4.21. RECORDATION. This Lease shall be recorded in the Public Records of Osceola County, Florida.

24

ATTEST:

hairinan By: Chai

OSCEOLA COUNTY, FLORIDA

id of4eOunty Commissioners

• IN WITNESS WHEREOF, the Board of Cbunty Commissioners of Osceola County, Florida has caused this Lease to be executed and delivered this day of OC.,*() bpA , 2011.

25

COLT'S MANUFACTURING COMPANY LLC

Print: t

IN WITNESS WHEREOF, Colt's Manufacturing Company, LLC has caused this Lease to be executed and delivered this , ---(4- day of 0 -0,1,6„er , 2011.

LtGeniiVrn M. Keys IJSMr /(Ret.) President and Chief Execitife Officer

WITNESSES:

"e7,7

Print:

26

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APPENDIX C DESCRIPTION OF THE COUNTY IMPROVEMENTS

APPENDIX C

OUTLINE SPECIFICATIONS

Division 2 — Site Work and Existing Conditions

Site Exterior 1) Remove all trellis structures, dead landscaping, provide new landscaping at entry, and

provide new street signs as per Osceola County.

2) Seal asphalt parking and stripe.

3) Relocate catch basin (at ext cooler location) to accommodate roof water runoff at new

Custom Fabrication.

4) Provide a 20 foot wide drive isle at the south end of the building to provide required

access to new KUA transformer. Drive isle concrete thickness is 6 inches and the

concrete is 4000 PSI ,concrete with commercial fiber

5) Remove 2 existing grease traps.

6) Repair existing lift station.

7) Jet all plumbing lines to make sure they are all draining properly.

8) Remove all concrete sidewalks in the exercise area and replace with sod.

Building Exterior 1) Pressure wash all exterior walls, and the roof on the metal building.

2) Remove 2 sets of double doors in multi-purpose rooms A & B and fill in openings.

3) Remove all windows in the multi-purpose rooms A and B and fill in openings.

Building Interior 1) Remove all existing acoustical ceilings.

2) Remove existing folding partitions in Manufacturing Area.

3) Remove existing steel I beam above north folding partition track.

Division 3 — Concrete

1) All disturbed slab areas in the building shall be termite treated prior to concrete

replacement.

2) All slab patches shall be 3000 psi concrete.

Division 4 — Masonry

1

1) Provide a 9' high concrete filled CMU wall to be constructed at north end of gun range,

creating a cavity between new and existing CMU walls. Cavity shall be filled with small

rock.

Division 5 — Metals

1) Provide 1 roll up door at north end of Manufacturing Area.

2) All metal building patches to cover abandoned openings shall be matched as closely as

possible with available R Panel.

Division 6 — Wood Provide base cabinets only in break rooms #1 and #2; Milbridge ll Oak cabinets with self edge

laminate countertop in standard colors.

Division 7 — Thermal

1) Metal Roof — Pressure clean, prime and coat with Hydrostop Primer and Hydrostop

Coating.

2) Replace shingle roof over existing Break Room/Fitness. Certainteed 25 year Fiberglass

shingle.

3) Repair metal roof in areas with rust spots.

4) Repair insulation in the ceiling at metal roof in the Manufacturing Area.

5) Replace all soffit and fascia on building exterior as needed.

6) Downspouts and Gutters shall be repaired or replaced as needed.

7) Roof at new Custom Fabrication room to be Certainteed Flint Lastic Self Adhesive 1.5

mm Ply Base and 4 mm Self Adhesive Granulated Cap.

Division 8 — Openings

1) Adjust all exterior doors and windows to close and lock properly and re-key doors. Add

6 magnetic locks to exterior steel doors. Re-use all existing door closures and crash bars

where possible.

2) Provide (1) 12 wide x 14 high roll up door (13'-6" clearance) at north wall of

manufacturing area.

3) All remaining windows shall be tinted with reflective film.

Division 9 — Finishes

1) All interior walls shall be painted.

2) Existing damaged sheetrock shall be replaced or patched as needed.

3) All existing flooring except the quarry tile in kitchen area shall be removed.

4) Room Finish Schedule:

All walls to be painted sheetrock

Range: concrete floors — open ceiling

Range Stations: VCT floors — acoustical ceiling

Manufacturing: concrete floors — open ceiling

Restrooms #1: Ceramic Tile floors/base — acoustical ceiling

Exist Corridor: VCT floors/vinyl base — acoustical ceiling

2

Restrooms #2: Ceramic Tile floors/base — Sheetrock Ceiling

Exist Elect & Util: VCT floors/vinyl base — acoustical ceiling

Custom Fabrication: concrete floors — acoustical ceiling

Storage: existing quarry tile floors to remain— acoustical ceiling

Mechanical Rm: VCT floor/vinyl base — acoustical ceiling

Fitness: VCT floors/vinyl base — acoustical ceiling

Break Room #1 — VCT floors/vinyl base — acoustical ceiling

Parts 1,2,3: VCT floors/vinyl base — acoustical ceiling

Offices 1-8: VCT floors/vinyl base — acoustical ceiling

Trophy Room: VCT floors/vinyl base- acoustical ceiling

Break Room #2: VCT floors/vinyl base — acoustical ceiling

Restrooms #3: Ceramic Tile floor/base — acoustical ceiling

5) Acoustical Ceiling' per drawing, install new Armstrong Prelude, white 2'x2' grid

system with Armstrong Fine Fissured #1728 flat ceiling tile.

6) All exterior walls shall be cleaned as necessary and repainted.

Division 10 — Specialties

1) Existing restroom accessories, restroom partitions, and ADA grab bars shall be replaced

with new.

2) Provide an 8 foot high chain link fence with razor wire at the top, with (2) - 26 foot

access gates at the north and south entries fronting Shady Lane.

Division 15 — Mechanical 1) A double bowl sink shall be installed in the Fitness Break Room.

2) 2 new floor drains shall be installed in the Manufacturing Area.

3) Install a 750 gallon oil separator with risers for the 2 new floor drains.

4) Replace all bath fixtures and upgrade to meet ADA.

5) Remove and properly dispose all existing HVAC units and replace with new. All existing

HVAC ducts shall be replaced. All a/c units shall have internal smoke detectors as

required by code.

6) HVAC Equipment:

1 — Carrier 10 ton straight cool 3 phase system with heat strip

4 — Carrier 5 ton straight cool 3 phase systems with heat strips

2- Carrier .3 ton straight cool 3 phase systems with heat strips

2 — Carrier 4 ton straight cool # phase systems with heat strips

Custom Fabrication room: 1 — 5 tons Carrier straight cool 3 phase system with heat strip

New copper line sets and drain lines for all systems

Replace all existing ductwork and grills

Smoke detectors for all equipment

Fresh Air intake as required by code

7) Replace fire sprinkler system to meet N.F.P.A. Life Safety Code.

Division 16 — Electrical

3

1) Electrical upgrade to 3 phase power.

2) Provide electric service connections to a maximum of 25 CNC machines

3) All interior Light Fixtures shall be replaced

4) Existing 400 amp service on East side of building will be discarded.

5) Price includes the dismantling of the 600 amp 3 phase service on north side of building.

6) Price includes a new 3000 amp transformer installed by KUA.

7) Existing parking lot lights (2) in south parking lot will be disconnected. Price does not

include removal of lights and poles.

8) Provide lighting only in Gun Range Area.

9) Provide a new Fire Alarm System to meet code requirement.

4