Exhibit 10.1

SUBLEASE

THIS SUBLEASE (this “Sublease”) is dated for reference purposes as of July 2 ,
2013, and is made by and between PALO ALTO NETWORKS, INC., a Delaware
corporation (“Sublessor”), and GIGAMON INC, a Delaware corporation
(“Sublessee”).  Sublessor and Sublessee hereby agree as follows:

1.  Recitals: This Sublease is made with reference to the fact that Santa Clara
Office Partners LLC, as landlord (“Master Lessor”), and Sublessor, as tenant,
entered into that certain lease, dated as of October 20, 2010, as amended by
that certain Amendment No. 1 to Lease dated as of March __, 2011 [original
undated] (the “First Amendment to Master Lease”) and that certain Amendment
No. 2 to Lease dated as of the date hereof (as amended, the “Master Lease”),
with respect to premises consisting of approximately 105,664 square feet of
space located at 3300 Olcott Street, Santa Clara, California (the “Premises”).
 A copy of the Master Lease is attached hereto as Exhibit A.

2.  Premises: Sublessor hereby subleases to Sublessee, and Sublessee hereby
subleases from Sublessor, the entire Premises (hereinafter, the “Subleased
Premises”).

3.  Term:

A.  Term.  The term (the “Term”) of this Sublease shall be for the period
commencing on the later of (i) January 1, 2014 or (ii) the date Sublessor
delivers possession of the Subleased Premises professionally cleaned and free of
occupancy by Sublessee’s employees and any personal property of Sublessor, other
than the Furniture (as defined below) (the “Commencement Date”) and ending on
March 31, 2018 (the “Expiration Date”), unless this Sublease is sooner
terminated pursuant to its terms or the Master Lease is sooner terminated
pursuant to its terms.

B.  Early Access.  Sublessor shall permit Sublessee to access the Subleased
Premises no later than December 14, 2013 (the “Delivery Date”), for the purpose
of installing its furniture, fixtures, voice and data communications systems and
any other improvements or equipment necessary for the conduct of Sublessee’s
business, subject to Sublessor’s receipt of Master Lessor’s consent to this
Sublease and all of the insurance certificates required of Sublessee under this
Sublease.  Such occupancy (i) shall be subject to all of the applicable
provisions of this Sublease, specifically excluding the obligation to pay Rent
(as defined below) but including the obligation to pay utilities; and (ii) shall
not advance the Expiration Date of this Sublease.  Sublessor and Sublessee
acknowledge that, during Sublessee’s early access period prior to the
Commencement Date, Sublessor’s employees and contractors may have access to the
Subleased Premises for purposes of causing them to be professionally cleaned and
in the required delivery condition.  Sublessor and Sublessee shall cooperate
with each other during such early access period to minimize interference with
each party’s activities.

C.  No Option to Extend.  The parties hereby acknowledge that the expiration
date of the Master Lease is March 31, 2018 and that Sublessee has no option to
extend the Term of this Sublease.  Sublessor shall use its best efforts to
request Master Landlord grant Sublessee an option to renew.  Provided that this
Sublease has not been terminated due to a default by Sublessee, Sublessor waives
any right it may have to extend the term of the Master Lease, including, without
limitation, Sublessor’s extension option rights under Article 15 of the Master
Lease.

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4.  Rent:

A. Base Rent.  The monthly base rent schedule (“Base Rent”) shall be as follows:

   

 

Months

Rate / sf

Base Rent

1-6

$2.23

$0.00

7-12

$2.23

$235,630.72

13-24

$2.30

$243,027.20

25-36

$2.37

$250,423.68

37-48

$2.44

$257,820.16

49-51

$2.51

$265,216.64

Notwithstanding the foregoing, Sublessor hereby agrees to provide Sublessee with
an additional credit against Base Rent in the amount of $528,320 ($5.00 per
rentable square foot of the Subleased Premises), which shall automatically be
applied against Base Rent first due commencing on the first day of the seventh
(7th) month of the Term, until such credit is exhausted.  Base Rent and
Additional Rent, as defined below, shall be paid on or before the first
(1st) day of each month.  Base Rent and Additional Rent for any period during
the Term hereof which is for less than one (1) month of the Term shall be a pro
rata portion of the monthly installment based on a thirty (30) day month.  Base
Rent and Additional Rent shall be payable without notice or demand and, except
as otherwise provided in this Sublease, without any deduction, offset, or
abatement, in lawful money of the United States of America.  Rent shall be paid
directly to Sublessor at 4401 Great America Parkway, Santa Clara, CA 95054,
Attention: Corporate Controller or such other address as may be designated in
writing by Sublessor.  Upon execution hereof by Sublessee and Sublessor,
Sublessee shall pay to Sublessor the sum of Two Hundred Thirty-Five Thousand Six
Hundred Thirty and 72/100 Dollars ($235,630.72), which shall be applied as a
credit against the first installment(s) of Base Rent due under this Sublease.

B.  Additional Rent.  All monies other than Base Rent required to be paid by
Sublessor under the Master Lease, including, without limitation, any amounts
payable by Sublessor to Master Lessor as “Property Operating Expenses” (as
defined in Section 3.2 of the Master Lease, as incorporated herein) and payment
of any business property taxes on the Furniture (defined below) with respect to
the Term, shall be paid by Sublessee hereunder as and when such amounts are due
hereunder.  All such amounts shall be deemed additional rent (“Additional
Rent”).  Base Rent and Additional Rent hereinafter collectively shall be
referred to as “Rent”.  Notwithstanding anything to the contrary contained in
this Sublease, (i) Sublessee shall not be required to pay any Rent that is due
as a result of any default by Sublessor (through no fault of Sublessee) of any
of Sublessor’s obligations under the Master Lease and (ii) in no event shall
Sublessee be liable or responsible to Sublessor for any costs, claims, demands
or liabilities to the extent arising from (a) any default by Sublessor in the
performance of its obligations under Section 4.11 of the Master Lease prior to
the Commencement Date or (b) any Hazardous Materials that were first introduced
to the Premises or Property prior to the Commencement Date through no fault of
Sublessee or any of its agents, contractors, employees or invitees.

5.  Late Charge: If Sublessee fails to pay to Sublessor any amount due hereunder
within five (5) days after the due date, Sublessee shall pay Sublessor upon
demand a late charge equal to five percent (5%) of the delinquent amount
accruing from the due date.  In addition, Sublessee shall pay to Sublessor
interest on all amounts due, at the rate identified in Section 3.4 of the Master
Lease, as incorporated herein (the “Interest Rate”), from the due date to and
including the date of the payment.  The parties agree that the foregoing late
charge represents a reasonable estimate of the cost and expense which Sublessor
will incur in processing each delinquent payment.  Sublessor’s acceptance of any
interest or late charge shall not waive Sublessee’s default in failing to pay
the delinquent amount.  Notwithstanding the foregoing, no late charge or
interest shall be due on the first (and only the first) late payment of Rent by
Sublessee during any twelve (12) month period during the Term unless Sublessee
fails to make such payment to Sublessor within five (5) days after Sublessee’s
receipt of a written notice of delinquency from Sublessor.

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6.  Security Deposit: Upon execution hereof by Sublessee, Sublessee shall
deposit with Sublessor the sum of Two Hundred Eighty-One Thousand Sixty-Six and
24/100 Dollars ($281,066.24) (the “Security Deposit”), in cash, as security for
the performance by Sublessee of the terms and conditions of this Sublease.  The
Security Deposit shall be held in accordance with the terms of Section 3.7 of
the Master Lease, as incorporated herein.

7.  Holdover: The parties hereby acknowledge that the expiration date of the
Master Lease is March 31, 2018 and that it is therefore critical that Sublessee
surrender the Subleased Premises to Sublessor no later than the Expiration Date
in accordance with the terms of this Sublease.  In the event that Sublessee does
not surrender the Subleased Premises by the Expiration Date in accordance with
Paragraph 19 hereof, Sublessee shall indemnify, defend, protect and hold
harmless Sublessor from and against all loss and liability resulting from
Sublessee’s delay in surrendering the Subleased Premises and pay Sublessor
holdover rent as provided in Section 13.2 of the Master Lease.

8.  Delivery and Acceptance:

A.  No later than the Delivery Date, Sublessor shall deliver possession of the
Subleased Premises to Sublessee in their current configuration free of any
employees of or personal property of Sublessor other than the Furniture (as
defined below), and, Sublessor shall cause the Subleased Premises to be
professionally cleaned no later than the Commencement Date.  If Sublessor fails
to deliver possession of the Subleased Premises to Sublessee for early access in
the required condition on or before the Delivery Date or fails to cause the
Commencement Date to occur by January 1, 2014 for any reason whatsoever, then
this Sublease shall not be void or voidable, nor shall Sublessor be liable to
Sublessee for any loss or damage; provided, however, that (i) in such event,
Sublessee shall receive one (1) day of free Rent for each day after (y) the
Delivery Date until Sublessor delivers possession of the Subleased Premises in
the condition required on the Delivery Date and (z) January 1, 2014 until the
Commencement Date occurs, with such “free Rent” not to exceed in the aggregate
forty-five (45) days.  In addition, if the Commencement Date does not occur by
February 28, 2014, then Sublessee may terminate this Sublease by delivery of
written notice to Sublessor of such termination not later than March 10, 2014,
whereupon this Sublease shall terminate (unless possession is delivered prior to
Sublessor’s receipt of such termination notice) and Sublessor shall promptly
refund to Sublessee the Security Deposit and prepaid Base Rent paid by Sublessee
to Sublessor under this Sublease.

B.  Notwithstanding the foregoing, Sublessor represents and warrants, to
Sublessor’s actual knowledge, that the Subleased Premises will be delivered in
watertight condition in their current configuration, in compliance with
applicable law and with all operating systems serving the Subleased Premises in
good operating condition and repair.  Except to the extent caused by the acts or
omissions of Sublessee or its agents, employees, or contractors or by any
alterations or improvements by Sublessee, if Sublessee delivers to Sublessor
written notice specifying a breach of the foregoing responsibilities within
sixty (60) days after the Commencement Date, Sublessor shall be responsible for
repairing or correcting the same; provided, however, that with respect to
repairs that are the obligation of Master Lessor under the Master Lease,
Sublessor’s obligations with respect to such repairs shall be limited as set
forth in Paragraph 28 below.  If Sublessor fails to perform its obligations
under this Paragraph 8.B, then, Sublessee shall have the right to perform such
obligations to the extent provided in Paragraph 27 below, but subject to the
notice and cure periods set forth therein.

9.  Repairs: The parties acknowledge and agree that Sublessee is subleasing the
Subleased Premises on an “as is” basis, except as otherwise expressly provided
in this Sublease, and that Sublessor has made no representations or warranties
with respect to the condition of the Subleased Premises except as expressly
provided in this Sublease.  Except as otherwise provided in Paragraph 8 above,
Sublessor shall have no obligation whatsoever to make or pay the cost of any
alterations, improvements or repairs to the Subleased Premises, including,
without limitation, any improvement or repair required to comply with any law,
regulation, building code or ordinance (including the Americans with
Disabilities Act of 1990).  Master Lessor shall be solely responsible for
performance of any repairs required to be performed by Master Lessor under the
terms of the Master Lease.

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10.  Indemnity: Except to the extent caused by the negligence or willful
misconduct of, or any violation of law (through no fault of Sublessee) by,
Sublessor, its agents, employees, contractors or invitees, Sublessee shall
indemnify, defend with counsel reasonably acceptable to Sublessor, protect and
hold Sublessor harmless from and against any and all claims, liabilities,
judgments, causes of action, damages, costs and expenses (including reasonable
attorneys’ and experts’ fees) (“Claims”), to the extent caused by or arising in
connection with: (i) the use or occupancy of the Subleased Premises by
Sublessee; (ii) the negligence or willful misconduct of Sublessee or its
employees, contractors, agents or invitees; or (iii) a breach of Sublessee’s
obligations under this Sublease or the provisions of the Master Lease that have
been incorporated into this Sublease as obligations of Sublessee.  Sublessee’s
indemnification of Sublessor shall survive termination of this Sublease.  In
addition, Sublessor shall indemnify, defend with counsel reasonably acceptable
to Sublessee, protect and hold Sublessee harmless from and against any and all
Claims to the extent caused by or arising in connection with the use or release
of Hazardous Materials by Sublessor or its agents, employees and contractors at
the Subleased Premises in violation of applicable environmental laws.

11.  Right to Cure Defaults: If Sublessee fails to pay any sum of money under
this Sublease, or fails to perform any other act on its part to be performed
hereunder, then Sublessor may, but shall not be obligated to, after passage of
any applicable notice and cure periods, make such payment or perform such act.
 All such sums paid, and all reasonable costs and expenses of performing any
such act, shall be deemed Additional Rent payable by Sublessee to Sublessor upon
demand, together with interest thereon at the Interest Rate from the date of the
expenditure until repaid.

12.  Assignment and Subletting.  Sublessee may not assign this Sublease, sublet
the Subleased Premises, transfer any interest of Sublessee therein or permit any
use of the Subleased Premises by another party (collectively, “Transfer”),
without the prior written consent of Sublessor (which consent shall be
conditioned upon the receipt of Master Lessor’s consent, but otherwise,
Sublessor’s consent shall not be unreasonably withheld, conditioned or delayed)
and Master Lessor to the extent required under the Master Lease.  Any Transfer
without such consent shall be void and, at the option of Sublessor, shall
terminate this Sublease.  Sublessor’s waiver or consent to any assignment or
subletting shall be ineffective unless set forth in writing, and Sublessee shall
not be relieved from any of its obligations under this Sublease unless the
consent expressly so provides.  Any Transfer shall be subject to the terms of
Article 7 of the Master Lease.  Notwithstanding the foregoing, as between
Sublessor and Sublessee only (and without limiting the rights of Master Lessor
under the Sublease or Sublessee’s obligations abide by the provisions and
restrictions of Article 7 of the Master Lease, including, without limitation,
the obligation to contain the consent of Master Lessor to the extent provided in
the Master Lease), Sublessor agrees that: (i) none of the following shall
constitute a Transfer: any change in the controlling ownership interest of the
entity that constitutes Sublessee which results from any of the following:
(a) the infusion of additional equity capital in Sublessee or an initial public
offering of equity securities of Sublessee under the Securities Act of 1933, as
amended, which results in Sublessee’s stock being traded on a national
securities exchange, including, but not limited to, the NYSE, the NASDAQ Stock
Market or the NASDAQ Small Cap Market System (a “National Exchange”); or (b) any
transfer or sale of the stock or other ownership interest in Sublessee (1) to
the spouse(s) and/or children of a shareholder of Sublessee, (2) to any trust,
the beneficiary(ies) of which are family members of a shareholder of Sublessee,
(3) by reason of bequest or inheritance, or (4) in connection with the issuance
of warrants or stock options to purchase Sublessee’s stock, and the exercise of
any purchase rights under any such warrants or stock options; provided, that any
such issuance or exercise does not result in a change in the controlling
percentage (as defined in the Master Lease) of the stock or other equity
interests of Sublessee; and (ii) Sublessee may assign this Sublease or sublet
the Subleased Premises, without any “recapture right” by Sublessor and without
any obligation to pay to Sublessor “assignment consideration” or “excess
rentals” (as such terms are defined in the Master Lease) to any entity
(i) controlling, controlled by or having fifty percent (50%) or more common
control with Sublessee, or (ii) resulting from a merger, non-bankruptcy
reorganization or consolidation with Sublessee or acquiring substantially all of
the assets and/or substantially all of the stock of Sublessee; provided that
(w) any such entity shall assume the obligations and liabilities of Sublessee
under this Sublease (or such of such obligations and liabilities as are to be
performed by the sublessee under the terms of the applicable sublease in the
event of a sublease), and no such assignment or sublease shall in any manner
release Sublessee from its primary liability

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under this Sublease, (x) any such entity has a net worth at the time of such
assignment or sublease that is sufficient to undertake the financial obligations
under this Sublease and at least equal to that of Sublessee immediately before
the merger, acquisition or other transaction, (y) Sublessee provides Sublessor
with at least ten (10) days prior written notice of such transaction (or within
ten [10] days after such transaction if Sublessee is prevented by law or any
bona fide confidentiality agreement from providing prior notice to Sublessor)
together with such information reasonably required by Sublessor that establishes
that the underlying transaction complies with the provisions of this sentence
and (z) Sublessee is not in monetary or material non-monetary default under the
Sublease beyond applicable notice and cure periods at the time of the proposed
Transfer.

13.  Use: Sublessee may use the Subleased Premises only for the uses identified
in Article 4 of the Master Lease.  Sublessee shall comply with all reasonable
rules and regulations promulgated from time to time by Master Lessor under the
Master Lease.

14.  Effect of Conveyance: As used in this Sublease, the term “Sublessor” means
the holder of the tenant’s interest under the Master Lease.  In the event of any
assignment, transfer or termination of the tenant’s interest under the Master
Lease, which assignment, transfer or termination may occur at any time during
the Term hereof in Sublessor’s sole discretion (but only so long as (i) any such
termination does not result in a breach of Sublessor’s obligations under this
Sublease and (ii) any assignment does not result in a termination of this
Sublease due to the exercise of any recapture right by Master Lessor under the
Master Lease), Sublessor shall be and hereby is entirely relieved of all
covenants and obligations of Sublessor hereunder first accruing after the date
of such transfer, provided that the transferee has assumed and agreed in writing
and shall carry out all covenants and obligations thereafter to be performed by
Sublessor hereunder.  Sublessor shall transfer and deliver any security of
Sublessee to the transferee of the tenant’s interest under the Master Lease, and
thereupon Sublessor shall be discharged from any further liability with respect
thereto.

15.  Improvements: No alteration or improvements shall be made to the Subleased
Premises, except in accordance with the Master Lease, and with the prior written
consent of both Master Lessor and Sublessor (which consent shall not be
unreasonably withheld, conditioned or delayed) in accordance with this Sublease.
 Notwithstanding the foregoing, Sublessor conceptually approves Sublessee’s
construction of the improvements to the Subleased Premises described on
Exhibit E attached hereto and made a part hereof, provided that such
improvements are constructed in accordance with Article 6 of the Master Lease.
 The foregoing approval by Sublessor does not waive any obligation of Sublessee
to obtain Master Lessor consent to such improvements or constitute a waiver of
Sublessor’s remaining rights with respect to the review and approval of such
improvements, such as approval over plans and specifications and determination
of restoration obligations.

16.  Release and Waiver of Subrogation: Notwithstanding anything to the contrary
in this Sublease, Sublessor and Sublessee hereby release each other from any
damage to property or loss of any kind which is caused by or results from any
risk insured against under any property insurance policy actually carried or
required to be carried by any such parties under this Sublease or the Master
Lease.  Each party shall cause each insurance policy obtained by it to provide
that the insurer waives all right of recovery against the other party and its
agents and employees in connection with any damage or injury covered by the
policy.  Sublessor shall not be liable to Sublessee, nor shall Sublessee be
entitled to terminate this Sublease or to abate Rent (except if and to the
extent Sublessor is allowed a proportionate abatement of Rent under the Master
Lease) for any: (i) failure or interruption of any utility system or service;
(ii) failure of Master Lessor to maintain the Subleased Premises as may be
required under the Master Lease; or (iii) penetration of water into or onto any
portion of the Subleased Premises.  The obligations of Sublessor and Sublessee
under this Sublease shall not constitute the personal obligations of the
officers, directors, trustees, partners, joint venturers, members, owners,
stockholders or other principals or representatives of either business entity.

17.  Insurance: Sublessee shall obtain and keep in full force and effect, at
Sublessee’s sole cost and expense, during the Term the insurance required under
Section 9.1 of the Master Lease.  Sublessee shall name Master Lessor and
Sublessor as additional insureds under its liability insurance policy.

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18.  Default; Remedies: Sublessee shall be in material default of its
obligations under this Sublease upon the occurrence of any of the “Events of
Default” set forth in Section 12.1 of the Master Lease, as incorporated herein.
 In the event of any Event of Default by Sublessee, Sublessor shall have all
remedies provided pursuant to Section 12.2 of the Master Lease and by applicable
law.  Sublessor may resort to its remedies cumulatively or in the alternative.

19.  Surrender: Prior to expiration of this Sublease, Sublessee shall remove all
of its trade fixtures and shall surrender the Subleased Premises to Sublessor in
the condition existing upon the delivery of possession of the Subleased Premises
to Sublessee, free of hazardous materials caused by Sublessee and in the
condition required by Section 2.6 the Master Lease (provided, however, that
Sublessee shall not be required to remove or restore any alterations or
improvements to the Premises made by or on behalf of Sublessor other than the
basketball court installed by Sublessor in the parking area, but only if and to
the extent such removal is required by Master Lessor under the Second Amendment
to Master Lease), reasonable wear and tear, any alterations or improvements to
the Subleased Premises made and paid for by Sublessee during the Term that
Master Lessor agrees may be surrendered at the expiration of the Term, and
damage caused by casualty or condemnation excepted.  If the Subleased Premises
are not so surrendered, then Sublessee shall be liable to Sublessor for all
costs incurred by Sublessor in returning the Subleased Premises to the required
condition, plus interest thereon at the Interest Rate.  Notwithstanding the
foregoing, if Sublessee has entered into a direct lease with Master Lessor
(including, without limitation, pursuant to the exercise of Sublessee’s rights
pursuant to Section 19 of the Master Lessor Consent (as defined below))
commencing concurrently with the expiration of the Term of this Sublease,
Sublessee’s obligations to surrender possession of the Subleased Premises in the
condition required under this Sublease on the Expiration Date shall be excused.

20.  Broker: Sublessor and Sublessee each represent to the other that they have
dealt with no real estate brokers, finders, agents or salesmen other than Cresa,
representing both Sublessor and Sublessee, in connection with this transaction.
 Each party agrees to hold the other party harmless from and against all claims
for brokerage commissions, finder’s fees or other compensation made by any other
agent, broker, salesman or finder as a consequence of such party’s actions or
dealings with such agent, broker, salesman, or finder.  Sublessee shall not be
obligated to pay any brokerage commission due to Cresa arising out of this
transaction.

21.  Notices: Unless at least five (5) days’ prior written notice is given in
the manner set forth in this paragraph, the address of each party for all
purposes connected with this Sublease shall be that address set forth below
their signatures at the end of this Sublease.  All notices, demands or
communications in connection with this Sublease shall be (a) personally
delivered; or (b) properly addressed and (i) submitted to an overnight courier
service, charges prepaid, or (ii) deposited in the mail (certified, return
receipt requested, and postage prepaid).  Notices shall be deemed delivered upon
receipt, if personally delivered, one (1) business day after being submitted to
an overnight courier service and three (3) business days after mailing, if
mailed as set forth above.  All notices given to Master Lessor under the Master
Lease shall be considered received only when delivered in accordance with the
Master Lease.

22.  Other Sublease Terms:

A   Incorporation By Reference.  Except as otherwise provided in or modified by
this Sublease, the terms and conditions of this Sublease shall include all of
the terms of the Master Lease and such terms are incorporated into this Sublease
as if fully set forth herein, except that: (i) each reference in such
incorporated sections to “Lease” shall be deemed a reference to “Sublease” and
each reference to “Base Monthly Rent” or “Rent” in such incorporated sections
(other than Section 13.2 of the Master Lease) shall be deemed a reference to the
Base Rent and Rent payable under this Sublease; (ii) each reference to the
“Premises” shall be deemed a reference to the “Subleased Premises”; (iii) each
reference to “Landlord” and “Tenant” shall be deemed a reference to “Sublessor”
and “Sublessee”, respectively, except as otherwise expressly set forth herein;
(iv) with respect to work, services, repairs, restoration, insurance,
indemnities, representations, warranties or the performance of any other
obligation of Master Lessor under the Master Lease, the sole obligation of
Sublessor shall be to request the same in writing

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from Master Lessor as and when requested to do so by Sublessee, and to use
Sublessor’s reasonable efforts (provided Sublessee agrees to pay Sublessor for
all reasonable out-of-pocket costs incurred by Sublessor in connection
therewith) to obtain Master Lessor’s performance as provided in Paragraph 28 of
this Sublease; (v) with respect to any obligation of Sublessee to be performed
under this Sublease, wherever the Master Lease grants to Sublessor a specified
number of days to perform its obligations under the Master Lease, except as
otherwise provided herein, Sublessee shall have one (1) fewer day to perform all
monetary obligations, and three (3) fewer days to perform non-monetary
obligations; provided, however, that with respect to any non-monetary
obligations that are required to be performed by Sublessor under the Master
Lease in seven (7) days or less, if any, Sublessee shall have two (2) fewer day
to perform such obligation, but in no event shall Sublessee shall have less than
one (1) day to perform a monetary or non-monetary obligation under this
Sublease; (vi) with respect to any approval required to be obtained from the
“Landlord” under the Master Lease, such consent must be obtained from both
Master Lessor and Sublessor, and the approval of Sublessor may be withheld if
Master Lessor’s consent is not obtained; (vii) in any case where the “Landlord”
reserves or is granted the right to manage, supervise, control, repair, alter,
regulate the use of, enter or use the Premises or any areas beneath, above or
adjacent thereto, such reservation or grant of right of entry shall be deemed to
be for the benefit of both Master Lessor and Sublessor (but Sublessor shall not
exercise any such rights as long as Sublessee is not in default of any of its
obligations under this Sublease); (viii) in any case where “Tenant” is to
indemnify, release or waive claims against “Landlord”, such indemnity, release
or waiver shall be deemed to run from Sublessee to both Master Lessor and
Sublessor, but such indemnification obligations shall only apply to the extent
of matters arising during the Term of this Sublease); (ix) in any case where
“Tenant” is to execute and deliver certain documents or notices to “Landlord”,
such obligation shall be deemed to run from Sublessee to both Master Lessor and
Sublessor; (x) all payments shall be made to Sublessor, except as otherwise
provided in this Sublease or as required by Master Lessor pursuant to its rights
under the Master Lease or the Master Lessor Consent (defined below); (xi) with
respect to any approval or consent sought by Sublessee under this Sublease,
Sublessee shall pay all consent and review fees set forth in the Master Lease to
both Master Lessor and Sublessor (it being understood that Sublessor, not
Sublessee, shall be obligated to pay any consent or review fees payable to
Master Lessor with respect to Master Lessor’s consent to this Sublease;
(xii) fifty percent (50%) of all “excess rentals” under subleases and
assignments, after payment of all such “excess rentals” due to Master Lessor
under the Master Lease, shall be paid to Sublessor and (xiii) Sublessor shall
not require Sublessee to provide financial statements pursuant to the
Sections 7.2 and 13.7 of the Master Lease, as incorporated herein, if Sublessee
is listed on a National Exchange.

Notwithstanding the foregoing, (a) the following provisions of the Master Lease
shall not be incorporated herein: Article 1 (except for the following
definitions: “Tenant’s Required Liability Coverage,” “Property,” “Building,”
“Outside Areas,” “Parking,” “Leased Premises,” “Tenant’s Expense Share,” and
“Permitted Use,”), Sections 2.1, 2.3, 2.4, 2.5, 3.1, 3.6, 13.3 (first sentence
only), 13.10, 14.1 (final clause of last sentence only), 14.2, Article 15,
Exhibit B, the First Amendment to Master Lease and the Second Amendment to
Master Lease; and (b) references in the following provisions to “Landlord” shall
mean Master Lessor only: Sections 3.2, 3.3, 4.4, 4.5 (last two sentences only),
4.6, 4.8, 4.10, 4.11(e), 4.12, 4.13, 5.1, 5.2, 5.4, 6.1 (second and third
sentences only), 6.2 (excluding the second sentence), 6.3, 7.2 (4th sentence
only), 7.3 (recapture right and joint marketing right only), 9.2, Article 10,
Article 11, Sections 12.4 (the entire first sentence and clause (ii) of the
second sentence only), 13.5, 13.8, 13.12, 16(b), Exhibit C, and Exhibit D.

B.  Performance of Obligations.  This Sublease is and at all times shall be
subject and subordinate to the Master Lease and the rights of Master Lessor
thereunder.  Sublessee hereby expressly agrees: (i) to comply with all
provisions of the Master Lease with respect to the Term to the extent
incorporated hereunder; and (ii) to perform all the obligations on the part of
the “Tenant” to be performed under the terms of the Master Lease with respect to
the Term of this Sublease which are incorporated hereunder.  Sublessee’s
obligations shall not include (and Sublessor’s obligations under this Sublease
shall include) the obligations of Sublessor under the Master Lease that
Sublessee has not expressly agreed to perform under this Sublease (collectively
referred to herein as “Sublessor’s Remaining Obligations”).  Sublessor shall not
agree to amend or modify the Master Lease in any way so as to materially or
adversely affect Sublessee or its interest thereunder, increase Sublessee’s
obligations thereunder or materially restrict Sublessee’s rights thereunder,
without the prior written approval of Sublessee, which may be

--------------------------------------------------------------------------------

withheld in Sublessee’s reasonable discretion.  Sublessor shall not voluntarily
terminate the Master Lease during the term of this Sublease for any reason
(including, without limitation, any damage to or destruction of the Subleased
Premises caused by a casualty pursuant to Section 10.4 of the Master Lease
(except as provided in Paragraph 22.C below) or eminent domain action pursuant
to Section 11.1 of the Master Lease) without Sublessee’s prior written approval
unless Master Lessor agrees to continue Sublessee’s occupancy of the Subleased
Premises for the remainder of the Term on the same terms and conditions of this
Sublease.  In the event the Master Lease is terminated for any reason
whatsoever, this Sublease shall terminate simultaneously with such termination
without any liability of Sublessor to Sublessee, unless such termination is
occasioned by (i) an Event of Default by Sublessor as the tenant under the
Master Lease not arising out of any default or breach of Sublessee hereunder, or
(ii) a breach of Sublessor’s obligations under this Sublease, including, without
limitation, Sublessor’s obligations under the preceding sentence of this
Paragraph, which termination in either case shall constitute a default by
Sublessor hereunder unless Master Lessor agrees to continue Sublessee’s
occupancy of the Subleased Premises for the remainder of the Term on the same
terms and conditions of this Sublease.  In the event of a conflict between the
provisions of this Sublease and the Master Lease, as between Sublessor and
Sublessee, the provisions of this Sublease shall control.  In the event of a
conflict between the express provisions of this Sublease and the provisions of
the Master Lease, as incorporated herein, the express provisions of this
Sublease shall prevail.

C.  Damage & Destruction.  Notwithstanding the foregoing or the terms of the
Master Lease, Sublessor and Sublessee agree that, if the Subleased Premises are
damaged or destroyed by casualty, (i) Sublessor shall have no obligation
whatsoever to repair the damage other than its obligation hereunder to use
reasonable efforts to cause Master Lessor to perform its obligations under the
Master Lease, (ii) Sublessor will not terminate this Sublease or, unless
Sublessee terminates this Sublease as a result of such casualty, the Master
Lease as a consequence of such destruction, (iii) Sublessee shall have the right
to terminate this Sublease to the extent, but only to the same extent that
Sublessor has a right to terminate the Master Lease as a consequence of such
destruction and (iv) if Sublessee desires to exercise its right to terminate
this Sublease, it shall provide Sublessor with written notice of its exercise of
any such election within not less than four (4) days after Sublessee’s receipt
from Sublessor of a copy of the written opinion of Landlord’s architect or
construction consultant required under Section 10.4 of the Master Lease
regarding the time it will take to complete the restoration work caused by a
casualty, and, Sublessee’s failure to provide such notice in such four (4) day
period shall constitute a waiver of its right to terminate this Sublease in
connection with such casualty.

23.  Conditions Precedent: This Sublease and Sublessor’s and Sublessee’s
obligations hereunder are conditioned upon each of the following (i) the written
consent of Master Lessor in the form attached hereto as Exhibit C the “Master
Lessor Consent”) or such other form as may be acceptable to Sublessor and
Sublessee, (ii) the execution and delivery of the Second Amendment to Master
Lease in the form attached hereto as Exhibit D (the “Second Amendment to Master
Lease”) and (iii) the consent of the Master Landlord’s lender to the Second
Amendment to Master Lease.  If all of the foregoing conditions are not satisfied
within thirty (30) days after execution of this Sublease by Sublessor and
Sublessee, then Sublessor or Sublessee may terminate this Sublease by giving the
other party ten (10) days’ prior written notice thereof, in which case this
Sublease shall terminate on the day following the last day of the ten (10)-day
notice period (unless all such conditions are satisfied during such ten (10)-day
period), whereupon Sublessor shall promptly return to Sublessee its payment of
the first month’s Rent paid by Sublessee pursuant to Paragraph 4 hereof and the
Security Deposit.  Sublessor shall use reasonable efforts to obtain Master
Lessor’s execution and delivery of the Master Lessor Consent and the Second
Amendment to Master Lease as soon as reasonably practicable.

24.  Authority to Execute: Sublessee and Sublessor each represent and warrant to
the other that each person executing this Sublease on behalf of each party is
duly authorized to execute and deliver this Sublease on behalf of that party.

25.  Termination; Recapture: Notwithstanding anything to the contrary herein,
Sublessee acknowledges that, under the Master Lease, Master Lessor has certain
termination and recapture rights, including, without limitation, in

--------------------------------------------------------------------------------

Section 7.3, 10.3, 11.2, and 12.2.  Nothing herein shall prohibit Master Lessor
from exercising any such rights and Master Lessor shall not have any liability
to Sublessee as a result thereof.  In the event Master Lessor exercises any such
termination or recapture rights, this Sublease shall terminate without any
liability to Master Lessor unless such termination is occasioned by an Event of
Default by Sublessor as the tenant under the Master Lease not arising out of any
default or breach of Sublessee hereunder, which termination shall constitute a
default by Sublessor hereunder unless Master Lessor agrees to continue
Sublessee’s occupancy of the Subleased Premises for the remainder of the Term on
the same terms and conditions of this Sublease.

26.  Signage; Parking.  Subject to Master Lessor’s consent and Sublessee’s
compliance with all applicable provisions of the Master Lease, including
Section 4.6, Sublessee, at Sublessee’s sole cost and expense, shall have any
rights to install signage that are granted to Sublessor under the Master Lease.
 Sublessee shall have all of Sublessor’s parking rights under the Master Lease,
at no additional charge to Sublessee, except as provided in Section 4.5 of the
Master Lease, as incorporated herein.

27.  Quiet Enjoyment Right to Cure.

A.  Sublessee shall peacefully have, hold and enjoy the Subleased Premises,
subject to the terms and conditions of this Sublease, provided that Sublessee
pays all Rent and performs all of Sublessee’s covenants and agreements contained
therein.  In the event, however, that Sublessor defaults in the performance or
observance of any of Sublessor’s Remaining Obligations under the Master Lease or
fails to perform Sublessor’s stated obligations under this Sublease to enforce,
for Sublessee’s benefit, Master Lessor’s obligations under the Master Lease,
then Sublessee shall give Sublessor notice specifying in what manner Sublessor
has defaulted, and if such default shall not be cured by Sublessor within twenty
(20) days thereafter (except that if such default cannot be cured within said
twenty (20)-day period, this period shall be extended for an additional
reasonable time, provided that Sublessor commences to cure such default within
such twenty (20)-day period and proceeds diligently thereafter to effect such
cure as soon as reasonably possible), then in addition, Sublessee shall be
entitled, at Sublessee’s option, to cure such default and promptly collect from
Sublessor Sublessee’s reasonable out-of-pocket expenses in so doing (including,
without limitation, reasonable attorneys’ fees and court costs).  Sublessee
shall not be required, however, to wait the entire cure period described herein
if (i) Sublessor’s default poses a material and imminent risk to the health or
safety of persons, or (ii) earlier action is required to comply with any
applicable governmental law, regulation or order.  Sublessor shall reimburse
Sublessee for the reasonable out of pocket costs incurred by Sublessee in
accordance with the terms of this Paragraph 27 (the “Reimbursement Amount”)
within thirty (30) days after Sublessee’s submission to Sublessor of Sublessee’s
bill therefor, which bill shall be accompanied by receipted, itemized invoices
(with reasonable supporting documentation) for the material or services
reflected in the bill.  In the event Sublessor fails to pay all or any portion
of the Reimbursement Amount due Sublessee under this Paragraph 27 within thirty
(30) days after receipt of Sublessee’s bill therefore, interest shall accrue on
such delinquent amount at the Interest Rate until such delinquent amount has
been paid or fully offset (as provided herein below), and Sublessee may with ten
(10) business days prior notice to Sublessor that it has elected to do so,
offset such delinquent amount against the monthly Base Rent due from Sublessee.
 Notwithstanding the foregoing, if Sublessor delivers to Sublessee a good faith
written objection notice within five (5) business days after receipt of
Sublessee’s notice of intent to offset, setting forth with reasonable
particularity Sublessor’s reasons for its claim that Sublessor is not required
to pay Sublessee all or any specified portion of the Reimbursement Amount, then
Sublessee shall not be entitled to offset the disputed portion of the
Reimbursement Amount, but Sublessee may institute arbitration proceedings
against Sublessor pursuant to Paragraph 27.A below to collect such amount;
provided, however, that in the event Sublessee is prevented from instituting an
arbitration proceeding because of the existence of the automatic stay under
applicable bankruptcy law, Sublessor shall bring a motion to modify the
automatic stay to allow Sublessor to arbitrate Sublessee’s entitlement to, and
the amount of the offset to which Sublessee is entitled, if any, within ten
(10) business days after Sublessor’s receipt of demand from Sublessee that
Sublessor do so, and if Sublessor shall fail to bring such motion within said
ten (10) business day period, then notwithstanding the provisions of this
sentence to the contrary, Sublessee shall have the right to proceed to offset
the disputed amount against monthly Base Rent due from Sublessee as provided in
the immediately preceding sentence of this Paragraph 27.

--------------------------------------------------------------------------------

B.  All claims or disputes between Sublessor and Sublessee relating to
Sublessee’s offset rights under Paragraph 27.A shall be resolved by expedited
arbitration before one (1) arbitrator.  The arbitration shall be administered by
JAMS pursuant to its Comprehensive Arbitration Rules and Procedure, modified as
follows: (i) the total time from date of demand for arbitration to final award
shall not exceed forty-five (45) days; (ii) all notices may be by telephone or
other electronic communication with later confirmation in writing; (iii) the
time, date, and place of the hearing shall be set by the arbitrator in his or
her sole discretion, provided that there shall be at least 10 business days
prior notice of the hearing; (iv) there shall be no discovery except by order of
the arbitrator; and (v) the arbitrator shall issue his or her award within ten
(10) business days after the close of the hearing.  The arbitration shall be
held in the county in which the Premises are located.  The decision of the
arbitrator shall be final and binding on the parties and judgment on the award
rendered by the arbitrator may be entered in any court of competent
jurisdiction.  The fees and expenses of the arbitrator shall be paid half by
Sublessor and half by Sublessee unless the arbitrator decides otherwise in its
decision.

28.  Sublessor’s Obligation, Sublessee’s Rights.  To the extent that the
provision of any services or the performance of any maintenance or any other act
respecting the Subleased Premises or the Building is the responsibility of
Master Lessor under the Master Lease (collectively “Master Lessor Obligations”),
upon Sublessee’s request, Sublessor shall make reasonable efforts to cause
Master Lessor to perform such Master Lessor Obligations, and Sublessee shall
(i) reimburse Sublessor on demand for any and all reasonable costs and expenses
(including reasonable attorneys’ fees and costs) incurred by Sublessor in
connection therewith, and (ii) indemnify, defend and hold harmless Sublessor
from and against any and all losses, costs, liabilities, claims, counterclaims,
reasonable out-of-pocket expenses and costs (including reasonable attorneys’
fees and costs) arising out of such efforts, except to the extent due to the
Sublessor’s negligence or willful misconduct.  Such reasonable efforts shall
include, without limitation: (i) upon Sublessee’s written request, immediately
notifying Master Lessor of its non-performance under the Master Lease, and
requesting that Master Lessor perform its obligations under the Master Lease;
and (ii) if Sublessor fails to commence appropriate legal action following a
default by Master Lessor, permitting Sublessee to commence a lawsuit or other
action in Sublessor’s name to obtain the performance required from Master Lessor
under the Master Lease; provided, however, that if Sublessee commences a lawsuit
or other action, Sublessee shall pay all reasonable out-of-pocket costs and
expenses incurred in connection therewith, and Sublessee shall indemnify, defend
and hold Sublessor harmless from all reasonable costs and expenses incurred by
Sublessor in connection therewith, except to the extent due to the Sublessor’s
negligence or willful misconduct.  Except to the extent Sublessor breaches its
obligations under this Sublease, in no event shall Sublessor be liable to
Sublessee for any liability, loss or damage whatsoever in the event that Master
Lessor should fail to perform the Master Lessor Obligations, nor shall Sublessee
be entitled to withhold the payment of Rent or terminate this Sublease.  It is
expressly understood that any indemnities (except as provided in Paragraph 22.A
above), warranties, services or repairs to be given or performed by “Landlord”
pursuant to the terms of the Master Lease which are incorporated herein by
reference are required to be furnished by Master Lessor and not by Sublessor.
 Sublessor shall not be liable for any repair or restoration following casualty
or destruction required to the Subleased Premises, other than its obligation
hereunder to use reasonable efforts to cause Master Lessor to perform its
obligations under the Master Lease.  Except as otherwise expressly provided in
this Sublease, Sublessor shall have no obligations to Sublessee with respect to
performance of the Master Lessor Obligations.

29.  Sublessor’s Representations.  Sublessor represents and warrants to
Sublessee that: (i) the Master Lease is in full force and effect, and to
Sublessor’s knowledge there exists under the Master Lease no default or event of
default by either Master Lessor or Sublessor, nor, to Sublessor’s knowledge, has
there occurred any event which, with the giving of notice or the passage of time
or both, could constitute such a default or event of default, (ii) the copy of
the Master Lease attached hereto is a true, correct and complete copy thereof,
(iii) to Sublessor’s knowledge, there are no pending or threatened actions,
suits or proceedings before any court or administrative agency against Sublessor
that could, in the aggregate, materially adversely affect the Subleased Premises
or any part thereof, or the ability of Sublessor to perform its obligations
under this Sublease or the Master Lease and (iv) to Sublessor’s knowledge,
Sublessor has not made any alterations to the Subleased Premises (excluding
wiring and cabling) that could be required to be removed at the expiration of
the term of the Master Lease other than the basketball court installed by
Sublessor in the parking area, but only if and to the extent such removal is
required by

--------------------------------------------------------------------------------

Master Lessor under the Second Amendment to Master Lease).  As used herein, the
phrase “to Sublessor’s knowledge” shall be deemed to refer to facts within the
actual knowledge only of John Ewert, Sublessor’s Vice President, Finance, as of
the date of this Sublease, and no others, without duty of inquiry whatsoever.

30.  Furniture, Fixtures and Equipment: Sublessee shall have the right to use
during the Term the office furnishings within the Subleased Premises which are
identified on Exhibit B attached hereto (the “Furniture”) at no additional cost
to Sublessee.  The Furniture is provided in its “AS IS, WHERE IS” condition,
without representation or warranty whatsoever, except that Sublessor represents
and warrants to Sublessee that Sublessor holds legal title to the Furniture free
of all liens and other encumbrances and has the right to convey legal title to
the Furniture to Sublessee.  Sublessee shall insure the Furniture under the
property insurance policy required under the Master Lease, as incorporated
herein.  Sublessee shall maintain the Furniture in good condition and repair,
reasonable wear and tear excepted, and shall be responsible for any loss or
damage to the same occurring during the Term.  Sublessee shall surrender the
Furniture to Sublessor upon the termination of this Sublease in the same
condition as exists as of the Commencement Date, reasonable wear and tear
excepted.  Sublessee shall not remove any of the Furniture from the Subleased
Premises.  Notwithstanding the foregoing, provided Sublessee is not then in
default under this Sublease beyond applicable notice and cure periods and
(ii) this Sublease has not terminated prior to the Expiration Date due to a
default by Sublessee, which conditions may be waived by Sublessor in its sole
discretion, then upon the termination of this Sublease, Sublessee shall have the
option to purchase the Furniture from Sublessor for a price of One Dollar
($1.00), and, if Sublessee properly exercises such option, Sublessor shall
provide a bill of sale in a commercially reasonable form for such Furniture
promptly upon request by Sublessee.

[Signatures on following page]

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IN WITNESS WHEREOF, the parties have executed this Sublease as of the day and
year first above written.

   

 

SUBLESSEE:

   

SUBLESSOR:

   

   

   

   

   

GIGAMON INC. a Delaware corporation

   

PALO ALTO NETWORKS, INC. a Delaware corporation

   

   

   

   

   

   

By:

/s/ Paul Hooper

   

By:

/s/ Jeffrey True

Name:

Paul Hooper

   

Name:

Jeff True

Its:

CEO

   

Its:

Vice President & General Counsel

   

   

   

   

   

Address:

   

   

Address:

   

   

   

   

   

   

Prior to the Commencement Date:

   

Prior to the Commencement Date:

GIGAMON INC.

   

PALO ALTO NETWORKS, INC.

598 Gibraltar Drive

   

3300 Olcott Street

Milpitas, CA 95035

   

Santa Clara, CA 95054

Attn: General Counsel

   

Attn: General Counsel

   

   

   

   

After the Commencement Date:

   

After the Commencement Date:

GIGAMON INC.

   

PALO ALTO NETWORKS, INC.

3300 Olcott Street

   

4401 Great America Parkway

Santa Clara, CA 95054

   

Santa Clara, CA 95054

Attn: General Counsel

   

Attn: General Counsel

   

--------------------------------------------------------------------------------

EXHIBIT A

   

MASTER LEASE

   

--------------------------------------------------------------------------------

LEASE

BY AND BETWEEN

SANTA CLARA OFFICE PARTNERS LLC,

a Delaware limited liability company

as Landlord

and

PALO ALTO NETWORKS, INC.
a Delaware corporation

as Tenant

October __, 2010

For Premises Located at:

3300 Olcott Street

Santa Clara, California

   

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TABLE OF CONTENTS

   

 

   

Page

Article 1 REFERENCE

18

   

1.1

   

References

18

Article 2 LEASED PREMISES, TERM AND POSSESSION

20

   

2.1

   

Demise Of Leased Premises

20

   

2.2

   

Right To Use Outside Areas

21

   

2.3

   

Lease Commencement Date And Lease Term

21

   

2.4

   

Delivery Of Possession

21

   

2.5

   

Performance Of Improvement Work; Acceptance Of Possession

21

   

2.6

   

Surrender Of Possession

21

Article 3 RENT, LATE CHARGES AND SECURITY DEPOSITS

22

   

3.1

   

Base Monthly Rent

22

   

3.2

   

Additional Rent

22

   

3.3

   

Year-End Adjustments

23

   

3.4

   

Late Charge, And Interest On Rent In Default

24

   

3.5

   

Payment Of Rent

24

   

3.6

   

Prepaid Rent

24

   

3.7

   

Security Deposit

24

Article 4 USE OF LEASED PREMISES AND OUTSIDE AREA

25

   

4.1

   

Permitted Use

25

   

4.2

   

General Limitations On Use

25

   

4.3

   

Noise And Emissions

26

   

4.4

   

Trash Disposal

26

   

4.5

   

Parking

26

   

4.6

   

Signs

26

   

4.7

   

Compliance With Laws And Restrictions

27

   

4.8

   

Compliance With Insurance Requirements

27

   

4.9

   

Landlord’s Right To Enter

27

   

4.10

   

Use Of Outside Areas

27

   

4.11

   

Environmental Protection

28

   

4.12

   

Rules And Regulations

30

   

4.13

   

Reservations

30

Article 5 REPAIRS, MAINTENANCE, SERVICES AND UTILITIES

30

--------------------------------------------------------------------------------

   

 

5.1

   

Repair And Maintenance

30

   

   

(a)

   

Tenant’s Obligations

30

   

   

(b)

   

Landlord’s Obligation

31

   

5.2

   

Utilities

31

   

5.3

   

Security

31

   

5.4

   

Energy And Resource Consumption

31

   

5.5

   

Limitation Of Landlord’s Liability

31

Article 6 ALTERATIONS AND IMPROVEMENTS

32

   

6.1

   

By Tenant

32

   

6.2

   

Ownership Of Improvements

32

   

6.3

   

Alterations Required By Law

33

   

6.4

   

Liens

33

Article 7 ASSIGNMENT AND SUBLETTING BY TENANT

33

   

7.1

   

By Tenant

33

   

7.2

   

Merger, Reorganization, or Sale of Assets

34

   

7.3

   

Landlord’s Election

35

   

7.4

   

Conditions To Landlord’s Consent

35

   

7.5

   

Assignment Consideration And Excess Rentals Defined

36

   

7.6

   

Payments

36

   

7.7

   

Good Faith

37

   

7.8

   

Effect Of Landlord’s Consent

37

Article 8 LIMITATION ON LANDLORD’S LIABILITY AND INDEMNITY

37

   

8.1

   

Limitation On Landlord’s Liability And Release

37

   

8.2

   

Tenant’s Indemnification Of Landlord

38

   

8.3

   

Landlord’s Indemnification Of Tenant

38

Article 9 INSURANCE

38

   

9.1

   

Tenant’s Insurance

38

   

9.2

   

Landlord’s Insurance

40

   

9.3

   

Mutual Waiver Of Subrogation

40

Article 10 DAMAGE TO LEASED PREMISES

41

   

10.1

   

Landlord’s Duty To Restore

41

   

10.2

   

Insurance Proceeds

41

   

10.3

   

Landlord’s Right To Terminate

41

   

10.4

   

Tenant’s Right To Terminate

41

   

10.5

   

Tenant’s Waiver

42

   

10.6

   

Abatement Of Rent

42

--------------------------------------------------------------------------------

   

 

Article 11 CONDEMNATION

42

   

11.1

   

Tenant’s Right To Terminate

42

   

11.2

   

Landlord’s Right To Terminate

42

   

11.3

   

Restoration

42

   

11.4

   

Temporary Taking

43

   

11.5

   

Division Of Condemnation Award

43

   

11.6

   

Abatement Of Rent

43

   

11.7

   

Taking Defined

43

Article 12 DEFAULT AND REMEDIES

43

   

12.1

   

Events Of Tenant’s Default

43

   

12.2

   

Landlord’s Remedies

44

   

12.3

   

Landlord’s Default And Tenant’s Remedies

46

   

12.4

   

Limitation Of Tenant’s Recourse

46

   

12.5

   

Tenant’s Waiver

47

Article 13 GENERAL PROVISIONS

47

   

13.1

   

Taxes On Tenant’s Property

47

   

13.2

   

Holding Over

47

   

13.3

   

Subordination To Mortgages

48

   

13.4

   

Tenant’s Attornment Upon Foreclosure

49

   

13.5

   

Mortgagee Protection

49

   

13.6

   

Estoppel Certificate

49

   

13.7

   

Tenant’s Financial Information

49

   

13.8

   

Transfer By Landlord

49

   

13.9

   

Force Majeure

50

   

13.10

   

Notices

50

   

13.11

   

Attorneys’ Fees and Costs

51

   

13.12

   

Definitions

51

   

   

(a)

   

Real Property Taxes

51

   

   

(b)

   

Landlord’s Insurance Costs

52

   

   

(c)

   

Property Maintenance Costs

52

   

   

(d)

   

Property Operating Expenses

53

   

   

(e)

   

Law

53

   

   

(f)

   

Lender

53

   

   

(g)

   

Rent

53

   

   

(h)

   

Restrictions

53

   

13.13

   

General Waivers

53

--------------------------------------------------------------------------------

   

 

13.14

   

Miscellaneous

54

   

13.15

   

Patriot Act Compliance

54

Article 14 LEGAL AUTHORITY BROKERS AND ENTIRE AGREEMENT

55

   

14.1

   

Legal Authority

55

   

14.2

   

Brokerage Commissions

55

   

14.3

   

Entire Agreement

56

   

14.4

   

Landlord’s Representations

56

Article 15 OPTIONS TO EXTEND

56

   

15.1

   

Option to Extend

56

   

15.2

   

Fair Market Rent

56

   

15.3

   

Tenant’s Election

57

   

15.4

   

Rent Arbitration

57

Article 16 TELEPHONE SERVICE

58

   

   

   

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LEASE

THIS LEASE, dated October __, 2010 for reference purposes only, is made by and
between Santa Clara Income Partners LLC, a Delaware limited liability company
(“Landlord”) and Palo Alto Networks, Inc., a Delaware corporation (“Tenant”), to
be effective and binding upon the parties as of the date the last of the
designated signatories to this Lease shall have executed this Lease (the
“Effective Date of this Lease”).

Article 1
REFERENCE

1.1  References.  All references in this Lease (subject to any further
clarifications contained in this Lease) to the following terms shall have the
following meaning or refer to the respective address, person, date, time period,
amount, percentage, calendar year or fiscal year as below set forth:

 

Tenant’s Representative:

Michael Lehman

Phone Number:

(408) 738-7779

Landlord’s Representative:

Henry Bullock/Richard Holmstrom

Phone Number:

(650) 326-9300

Delivery Date:

Two (2) business days after the Effective Date of this Lease

Commencement Date:

April 1, 2011

Term:

Eighty-four (84) months

Lease Expiration Date:

Eighty-four (84) months from the Lease Commencement Date, unless earlier
terminated by Landlord in accordance with the terms of this Lease, or extended
by Tenant pursuant to Article 15.

Options to Extend:

Two (2) option(s) to extend, each for a term of five (5) years.

First Month’s Prepaid Rent:

$124,000.00

Tenant’s Security Deposit:

$190,159.20 plus Landlord’s estimate of the Property Operating Expenses
applicable to the 84th month of the Lease Term.

Late Charge Amount:

Five Percent (5%) of the Delinquent Amount

Tenant’s Required Liability Coverage:

$5,000,000 Combined Single Limit

Tenant’s Broker(s):

Cresa Partners (John Brady)

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Property:

That certain real property situated in the City of Santa Clara, County of Santa
Clara, State of California, Assessor’s Parcel No. 224-47-017, as presently
improved with one (1) building, which real property is shown on the Site Plan
attached hereto as Exhibit A and is commonly known as or otherwise described as
follows: 3300 Olcott Street, Santa Clara, California.

Building:

That certain building on the Property in which the Leased Premises are located
(the “Building”), which Building is shown outlined on Exhibit A hereto.

Outside Areas:

The “Outside Areas” shall mean all areas within the Property which are located
outside the Building, such as pedestrian walkways, parking areas, landscaped
areas, open areas and enclosed trash disposal areas.

Parking:

With respect to the Leased Premises, Tenant shall be entitled to utilize all
parking spaces on the Property, such spaces to be located in the parking area of
the Outside Areas

Leased Premises:

All the interior space within the Building, including stairwells, connecting
walkways, and atriums, consisting of approximately 105,664 rentable square feet
as determined by Landlord’s method of measurement (which has been explained to
Tenant) and, for purposes of this Lease, agreed to contain said number of
rentable square feet.  The Building and the Leased Premises are not subject to
re-measurement unless, pursuant to a written amendment to this Lease, space is
subtracted therefrom or additional space is added thereto.  Recognizing that
both Landlord and Tenant have agreed to the foregoing rentable square footage
number and have agreed that there will be no re-measurement except as expressly
provided above, Landlord has given Tenant the opportunity to measure the
Building and the Leased Premises and has encouraged Tenant to do so, and Tenant
hereby confirms that it has measured the Building and the Leased Premises and is
in agreement with the foregoing number.

_____________

Initials

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Tenant’s Expense Share:

The term “Tenant’s Expense Share” shall mean the percentage obtained by dividing
the rentable square footage of the Leased Premises at the time of calculation by
the rentable square footage of all buildings located on the Property at the time
of calculation.  Such percentage is currently 100%.  In the event that any
portion of the Property is sold by Landlord, or the rentable square footage of
the Leased Premises or the Property is otherwise changed, Tenant’s Expense Share
shall be recalculated to equal the percentage described in the first sentence of
this paragraph, so that the aggregate Tenant’s Expense Share of all tenants of
the Property shall equal 100%.  Tenant’s Expense Share is subject to adjustment
as set forth in Paragraphs 13.12(b) and 13.12 (c).

Base Monthly Rent:

The term “Base Monthly Rent” shall mean the following:

   

Period

Base Monthly Rent

   

4/1/2011 – 3/31/2012

$0

   

4/1/2012 – 3/31/2013

$124,000.00

   

4/1/2013 – 9/30/2013

$128,000.00

   

10/1/2013 – 3/31/2014

$169,030.40

   

4/1/2014 – 3/31/2015

$174,312.60

   

4/1/2015 – 3/31/2016

$179,594.80

   

4/1/2016 – 3/31/2017

$184,877.00

   

4/1/2017 – 3/31/2018

$190,159.20

Permitted Use:

General office, engineering, research and development, testing, light assembly,
electronic laboratories, sales, training, storage of Tenant’s products, and
ancillary related uses, to the extent in compliance with all Laws and
Restrictions and the terms of this Lease.

Exhibits:

The term “Exhibits” shall mean the Exhibits of this Lease which are described as
follows:

Exhibit A - Site Plan showing the Property and delineating the Building in which
the Leased Premises are located.

Exhibit B — Tenant Work Letter

Exhibit C — Subordination, Nondisturbance and Attornment Provisions

Exhibit D — Form of Tenant Estoppel Certificate

Article 2
LEASED PREMISES, TERM AND POSSESSION

2.1  Demise Of Leased Premises.  Landlord hereby leases to Tenant and Tenant
hereby leases from Landlord for Tenant’s own use in the conduct of Tenant’s
business and not for purposes of speculating in real estate, for the Lease Term
and upon the terms and subject to the conditions of this Lease, that certain
interior space described in Article 1 as the Leased Premises, reserving and
excepting to Landlord the right to fifty percent (50%) of all assignment
consideration and excess rentals as provided in Article 7 below.  Tenant’s lease
of the Leased Premises, together with the appurtenant right to use the Outside
Areas as described in Paragraph 2.2 below, shall be conditioned upon and be
subject to the continuing compliance by Tenant with (i) all the terms and
conditions of this Lease, (ii) all Laws and Restrictions governing the use or
occupancy of the Leased Premises and the Property, (iii) all easements and other
matters now of public record respecting the use of the Leased Premises and
Property, and (iv) all reasonable rules and regulations from time to time
established by Landlord.  Notwithstanding any provision of this Lease to the
contrary, Landlord hereby reserves to itself and its designees all rights of
access, use

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and occupancy of the Building roof, and Tenant shall have no right of access,
use or occupancy of the Building roof except (if at all) to the extent required
in order to enable Tenant to perform Tenant’s maintenance and repair obligations
pursuant to this Lease.  Tenant acknowledges receipt, without representation or
warranty by Landlord, of Landlord’s existing title insurance policy relating to
the Property (the “Title Policy”).  Landlord represents to Tenant that to
Landlord’s knowledge, there are no covenants, conditions and restrictions
encumbering the Property other than as shown on the Title Policy.  In addition,
Landlord also agrees that Tenant’s construction of the Tenant Improvements (as
defined in Paragraph 2.5 below) as approved by Landlord and constructed in
accordance with the Work Letter (as defined in Paragraph 2.4 below), will not
constitute a default under this Lease, even if the same is a technical default
under the covenants, conditions and restrictions described in Paragraph 1 of
Schedule B of the Title Policy.

2.2  Right To Use Outside Areas.  As an appurtenant right to Tenant’s right to
the use and occupancy of the Leased Premises, Tenant shall have the right to use
the Outside Areas in conjunction with its use of the Leased Premises solely for
the purposes for which they were designed and intended and for no other purposes
whatsoever.  Tenant’s right to so use the Outside Areas shall be subject to the
limitations on such use as set forth in Article 1 and shall terminate
concurrently with any termination of this Lease.

2.3  Lease Commencement Date And Lease Term.  The term of this Lease shall
begin, and the Lease Commencement Date shall be deemed to have occurred, on the
Commencement Date, as set forth in Article 1 (the “Lease Commencement Date”).
 The term of this Lease shall in all events end on the Lease Expiration Date (as
set forth in Article 1).  The Lease Term shall be that period of time commencing
on the Lease Commencement Date and ending on the Lease Expiration Date (the
“Lease Term”).

2.4  Delivery Of Possession.  Landlord shall deliver to Tenant possession of the
Leased Premises on the Delivery Date in its “AS IS” condition, with all faults,
subject only to (a) Landlord completing the Landlord’s Work as defined in the
Work Letter attached hereto as Exhibit B (the “Work Letter”), and (b) latent
defects in the components of the Building for which Landlord has the maintenance
obligations pursuant to Paragraph 5.1(b) below.  Tenant has inspected the
Building and the Leased Premises and has noted no defects.  Landlord agrees to
assign or otherwise make available to Tenant the benefit of any warranties
received by Landlord with respect to Landlord’s Work.  Tenant may occupy the
Leased Premises prior to the Lease Commencement Date commencing on the Delivery
Date for the sole purpose of constructing tenant improvements and installing
furniture, fixtures and equipment, provided that Tenant shall comply with all
other provisions of this Lease (other than payment of Base Monthly Rent and
Additional Rent, except that Tenant shall pay for utilities from and after the
Delivery Date).

2.5  Performance Of Improvement Work; Acceptance Of Possession.  Tenant shall,
in accordance with and pursuant to the Work Letter, perform the work and make
the installations in the Leased Premises substantially as set forth in the Work
Letter (such work and installations to be performed by Tenant hereinafter
referred to as the “Tenant Improvements”).  It is agreed that by accepting
possession of the Leased Premises, Tenant formally accepts same and acknowledges
that the Building is in the condition called for by this Lease and the Work
Letter, subject only to defects described in clause (b) of Paragraph 2.4 above.
 Tenant shall prosecute the Tenant Improvements employing commercially
reasonable efforts so as not to delay Landlord in the completion of Landlord’s
Work.  No delay in the completion of the Tenant Improvements or the Landlord’s
Work shall affect the Lease Commencement Date, which shall in all events be as
set forth in Paragraph 2.3 above.

2.6  Surrender Of Possession.  Immediately prior to the expiration or upon the
sooner termination of this Lease, Tenant shall remove all of Tenant’s signs from
the exterior of the Building and shall remove all of Tenant’s equipment
(excluding telecommunications wiring and cabling), trade fixtures, furniture,
supplies, wall decorations and other personal property from within the Leased
Premises, the Building and the Outside Areas, and shall vacate and surrender the
Leased Premises, the Building, the Outside Areas and the Property to Landlord in
the same condition, broom clean, as existed at the Lease Commencement Date,
reasonable wear and tear excepted.  Tenant shall repair all damage to the Leased
Premises, the exterior of the Building and the Outside Areas caused by Tenant’s
removal of Tenant’s property.  Tenant shall, with respect to telecommunications
wiring and cabling,

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leave the same in good condition and repair and labeled and/or coded
sufficiently so that Landlord can readily determine the origin, destination and
function of the wires and cables.  Tenant shall patch and refinish, to
Landlord’s reasonable satisfaction, all penetrations made by Tenant or its
employees to the floor, walls or ceiling of the Leased Premises, whether such
penetrations were made with Landlord’s approval or not.  Tenant shall repair or
replace all stained or damaged ceiling tiles, wall coverings and floor coverings
to the reasonable satisfaction of Landlord.  Tenant shall repair all damage
caused by Tenant to the exterior surface of the Building and the paved surfaces
of the Outside Areas and, where necessary, replace or resurface same.
 Additionally, to the extent that Landlord shall have notified or is deemed to
have notified Tenant in writing at the time the improvements were completed that
it desired to have certain improvements made by Tenant or at the request of
Tenant removed at the expiration or sooner termination of the Lease, Tenant
shall, upon the expiration or sooner termination of the Lease, remove any such
improvements constructed or installed by Landlord or Tenant and repair all
damage caused by such removal.  If the Leased Premises, the Building, the
Outside Areas and the Property are not surrendered to Landlord in the condition
required by this paragraph at the expiration or sooner termination of this
Lease, Landlord may, at Tenant’s expense, so remove Tenant’s signs, property
and/or improvements not so removed and make such repairs and replacements not so
made or hire, at Tenant’s expense, independent contractors to perform such work.
 Tenant shall be liable to Landlord for all costs incurred by Landlord in
returning the Leased Premises, the Building and the Outside Areas to the
required condition, together with interest on all costs so incurred from the
date paid by Landlord at the then maximum rate of interest not prohibited or
made usurious by law until paid.  Tenant shall pay to Landlord the amount of all
costs so incurred plus such interest thereon, within ten (10) days of Landlord’s
billing Tenant for same.  Notwithstanding the foregoing, Landlord may consent
(in its sole and absolute discretion, which consent may be withheld for any
reason or no reason) to accept a cash payment from Tenant in lieu of Tenant
completing all or any portion of the work required pursuant to this paragraph,
such consent to be in a written notice specifying the work from which Tenant
shall be excused.  Tenant shall indemnify Landlord against loss or liability
resulting from delay by Tenant in surrendering the Leased Premises, including,
without limitation, any claims made by any succeeding Tenant or any losses to
Landlord with respect to lost opportunities to lease to succeeding tenants.

Article 3
RENT, LATE CHARGES AND SECURITY DEPOSITS

3.1  Base Monthly Rent.  Commencing on the Lease Commencement Date (as
determined pursuant to Paragraph 2.3 above) and continuing throughout the Lease
Term, Tenant shall pay to Landlord, without prior demand therefor, in advance on
the first day of each calendar month, cash or other immediately available good
funds in the amount set forth as “Base Monthly Rent” in Article 1 (the “Base
Monthly Rent”).

3.2  Additional Rent.  Commencing on the Lease Commencement Date (as determined
pursuant to Paragraph 2.3 above) and continuing throughout the Lease Term, in
addition to the Base Monthly Rent and to the extent not required by Landlord to
be contracted for and paid directly by Tenant, Tenant shall pay to Landlord as
additional rent (the “Additional Rent”), cash or other immediately available
good funds in the following amounts:

(a)  An amount equal to all Property Operating Expenses (as defined in
Article 13) incurred or to be incurred by Landlord.  Payment shall be made by
whichever of the following methods (or combination of methods) is (are) from
time to time designated by Landlord:

(i)  Landlord may forward invoices or bills for such expenses to Tenant, and
Tenant shall, no later than ten (10) days prior to the due date, pay such
invoices or bills and deliver satisfactory evidence of such payment to Landlord,
and/or

(ii)  Landlord may bill to Tenant, on a periodic basis not more frequently than
monthly, the amount of such expenses (or group of expenses) as paid or incurred
by Landlord, and Tenant shall pay to Landlord the amount of such expenses within
ten days after receipt of a written bill therefor from Landlord, and/or

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(iii)  Landlord may deliver to Tenant Landlord’s reasonable estimate of any
given expense (such as Landlord’s Insurance Costs or Real Property Taxes), or
group of expenses, which it anticipates will be paid or incurred for the ensuing
calendar or fiscal year, as Landlord may determine, and Tenant shall pay to
Landlord an amount equal to the estimated amount of such expenses for such year
in equal monthly installments during such year with the installments of Base
Monthly Rent.  Landlord reserves the right to revise such estimate from time to
time.

Landlord reserves the right to change from time to time the methods of billing
Tenant for any given expense or group of expenses or the periodic basis on which
such expenses are billed.

(b)  Landlord’s share of the consideration received by Tenant upon certain
assignments and sublettings as required by Article 7.

(c)  Any legal fees and costs that Tenant is obligated to pay or reimburse to
Landlord pursuant to Article 13; and

(d)  Any other charges or reimbursements due Landlord from Tenant pursuant to
the terms of this Lease.

Notwithstanding the foregoing, Landlord may elect by written notice to Tenant to
have Tenant pay Real Property Taxes or any portion thereof directly to the
applicable taxing authority, in which case Tenant shall make such payments and
deliver satisfactory evidence of payment to Landlord no later than ten (10) days
before such Real Property Taxes become delinquent.  In the event Tenant is
responsible to pay taxes directly, Landlord shall have no obligation to make
such payments, whether or not Landlord receives evidence of payment from Tenant,
and Tenant shall in all cases be responsible for any fines, penalties, interest
and damages for late payment.

3.3  Year-End Adjustments.  If Landlord shall have elected to bill Tenant for
the Property Operating Expenses (or any group of such expenses) on an estimated
basis in accordance with the provisions of Paragraph 3.2(a)(iii) above, Landlord
shall furnish to Tenant within four months following the end of the applicable
calendar or fiscal year, as the case may be, a statement setting forth (i) the
amount of such expenses paid or incurred during the just ended calendar or
fiscal year, as appropriate, and (ii) the amount that Tenant has paid to
Landlord for credit against such expenses for such period.  If Tenant shall have
paid more than its obligation for such expenses for the stated period, Landlord
shall, at its election, either (i) credit the amount of such overpayment toward
the next ensuing payment or payments of Additional Rent that would otherwise be
due or (ii) refund in cash to Tenant the amount of such overpayment.  If such
year-end statement shall show that Tenant did not pay its obligation for such
expenses in full, then Tenant shall pay to Landlord the amount of such
underpayment within thirty (30) days from Landlord’s billing of same to Tenant.
 Tenant may, at Tenant’s sole cost and expense, cause an audit of Landlord’s
books and records to determine the accuracy of Landlord’s billings for Property
Operating Expenses under this Lease, provided Tenant completes (and delivers to
Landlord the written results of) such audit within sixty (60) days after
Tenant’s receipt of the year-end statement described above setting forth the
annual reconciliation of the Property Operating Expenses, and provided further
that the person or entity performing such audit is not compensated on any type
of contingent basis.  If such audit reveals that the actual Property Operating
Expenses for any given year were less than the amount that Tenant paid for
Property Operating Expenses for any such year, then unless Landlord contests
such audit results as provided below, Landlord shall credit the excess to
Tenant’s next payment of Additional Rent and Landlord shall pay the cost of
Tenant’s audit.  If such audit reveals that the actual Property Operating
Expenses for any given year were more than the amount that Tenant paid for
Property Operating Expenses for any such year, Tenant shall pay such amount to
Landlord within thirty (30) days after completion of the audit.  Landlord shall
have the right to contest the results of Tenant’s audit and thereafter promptly
have an audit performed (“Landlord’s Audit”) by a certified public accounting
firm selected by Landlord and acceptable to Tenant in Tenant’s reasonable
discretion.  In such case, the results of Landlord’s audit shall be binding and
conclusive on Landlord and Tenant, and any resulting overpayment or underpayment
shall be handled as provided above.  Tenant shall pay the cost of Landlord’s
Audit

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unless Landlord’s Audit confirms the accuracy of the audit performed by Tenant,
in which case Landlord shall pay the cost of Landlord’s Audit.  The provisions
of this Paragraph shall survive the expiration or sooner termination of this
Lease.

3.4  Late Charge, And Interest On Rent In Default.  Tenant acknowledges that the
late payment by Tenant of any monthly installment of Base Monthly Rent or any
Additional Rent will cause Landlord to incur certain costs and expenses not
contemplated under this Lease, the exact amounts of which are extremely
difficult or impractical to fix.  Such costs and expenses will include without
limitation, administration and collection costs and processing and accounting
expenses.  Therefore, if any installment of Base Monthly Rent is not received by
Landlord from Tenant within five (5) calendar days after the same becomes due,
Tenant shall immediately pay to Landlord a late charge in an amount equal to the
amount set forth in Article 1 as the “Late Charge Amount,” and if any Additional
Rent is not received by Landlord when the same becomes due, Tenant shall
immediately pay to Landlord a late charge in an amount equal to 5% of the
Additional Rent not so paid.  Landlord and Tenant agree that this late charge
represents a reasonable estimate of such costs and expenses and is fair
compensation to Landlord for the anticipated loss Landlord would suffer by
reason of Tenant’s failure to make timely payment.  In no event shall this
provision for a late charge be deemed to grant to Tenant a grace period or
extension of time within which to pay any rental installment or prevent Landlord
from exercising any right or remedy available to Landlord upon Tenant’s failure
to pay each rental installment due under this Lease when due, including the
right to terminate this Lease.  If any rent remains delinquent for a period in
excess of five (5) calendar days, then, in addition to such late charge, Tenant
shall pay to Landlord interest on any rent that is not so paid from said fifth
day at the then maximum rate of interest not prohibited or made usurious by Law
until paid.

3.5  Payment Of Rent.  Except as specifically provided otherwise in this Lease,
all rent shall be paid in lawful money of the United States, without any
abatement, reduction or offset for any reason whatsoever, to Landlord at such
address as Landlord may designate from time to time.  Tenant’s obligation to pay
Base Monthly Rent and all Additional Rent shall be appropriately prorated at the
commencement and expiration of the Lease Tenn.  The failure by Tenant to pay any
Additional Rent as required pursuant to this Lease when due shall be treated the
same as a failure by Tenant to pay Base Monthly Rent when due, and Landlord
shall have the same rights and remedies against Tenant as Landlord would have
had Tenant failed to pay the Base Monthly Rent when due.

3.6  Prepaid Rent.  Tenant shall, upon execution of this Lease, pay to Landlord
the amount set forth in Article 1 as “First Month’s Prepaid Rent” as prepayment
of rent for credit against the first payment of Base Monthly Rent and Additional
Rent due hereunder.

3.7  Security Deposit.  Tenant shall deposit concurrently with Tenant’s
execution of this Lease, with Landlord the amount set forth in Article 1 as the
“Security Deposit” as security for the performance by Tenant of the terms of
this Lease to be performed by Tenant, and not as prepayment of rent.  Tenant
hereby grants to Landlord a security interest in the Security Deposit, including
but not limited to replenishments thereof.  Landlord may apply such portion or
portions of the Security Deposit as are reasonably necessary for the following
purposes: (i) to remedy any default by Tenant in the payment of Base Monthly
Rent or Additional Rent or a late charge or interest on defaulted rent, or any
other monetary payment obligation of Tenant under this Lease; (ii) to repair
damage to the Leased Premises, the Building or the Outside Areas caused or
permitted to occur by Tenant; (iii) to clean and restore and repair the Leased
Premises, the Building or the Outside Areas following their surrender to
Landlord if not surrendered in the condition required pursuant to the provisions
of Article 2, (iv) to remedy any other default of Tenant including, without
limitation, paying in full on Tenant’s behalf any sums claimed by materialmen or
contractors of Tenant to be owing to them by Tenant for work done or
improvements made at Tenant’s request to the Leased Premises, and (v) to cover
any other expense, loss or damage which Landlord may at any time suffer due to
Tenant’s default.  In this regard, Tenant hereby waives any restriction on the
uses to which the Security Deposit may be applied as contained in
Section 1950.7(c) of the California Civil Code and/or any successor statute.  In
the event the Security Deposit or any portion thereof is so used, Tenant shall
pay to Landlord, promptly upon demand, an amount in cash sufficient to restore
the Security Deposit to the full original

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sum.  Landlord shall not be deemed a trustee of the Security Deposit.  Landlord
may use the Security Deposit in Landlord’s ordinary business and shall not be
required to segregate it from Landlord’s general accounts.  Tenant shall not be
entitled to any interest on the Security Deposit.  If Landlord transfers the
Building or the Property during the Lease Term, Landlord may pay the Security
Deposit to any subsequent owner in conformity with the provisions of
Section 1950.7 of the California Civil Code and/or any successor statute, in
which event the transferring landlord shall be released from all liability for
the return of the Security Deposit.  Tenant specifically grants to Landlord (and
Tenant hereby waives the provisions of California Civil Code Section 1950.7 to
the contrary) a period of thirty days following a surrender of the Leased
Premises by Tenant to Landlord within which to inspect the Leased Premises, make
required restorations and repairs, receive and verify workmen’s billings
therefor, cure any other defaults, deduct any damages, and prepare a final
accounting with respect to the Security Deposit.  In no event shall the Security
Deposit or any portion thereof, be considered prepaid rent.

Article 4
USE OF LEASED PREMISES AND OUTSIDE AREA

4.1  Permitted Use.  Tenant shall be entitled to use the Leased Premises solely
for the “Permitted Use” as set forth in Article 1 and for no other purpose
whatsoever.  Tenant shall continuously and without interruption occupy the
Leased Premises for such purpose for the entire Lease Term.  Any discontinuance
of such use for a period of sixty consecutive calendar days shall be, at
Landlord’s election, a default by Tenant under the terms of this Lease provided
that no discontinuance shall exist during any period in which Tenant is actively
attempting to sublet or assign the Premises.  Tenant shall have the right to use
the Outside Areas in conjunction with its Permitted Use of the Leased Premises
solely for the purposes for which they were designed and intended and for no
other purposes whatsoever.

4.2  General Limitations On Use.  Tenant shall not do or permit anything to be
done in or about the Leased Premises, the Building, the Outside Areas or the
Property which does or could (i) jeopardize the structural integrity of the
Building or (ii) cause damage to any part of the Leased Premises, the Building,
the Outside Areas or the Property.  Tenant shall not operate any equipment
within the Leased Premises which does or could (A) injure, vibrate or shake the
Leased Premises or the Building, (B) damage, overload or impair the efficient
operation of any electrical, plumbing, heating, ventilating or air conditioning
systems within or servicing the Leased Premises or the Building, or (C) damage
or impair the efficient operation of the sprinkler system (if any) within or
servicing the Leased Premises or the Building.  Tenant shall not install any
equipment or antennas on or make any penetrations of the exterior walls or roof
of the Building.  Tenant shall not affix any equipment to or make any
penetrations or cuts in the floor, ceiling, walls or roof of the Leased
Premises.  Tenant shall not place any loads upon the floors, walls, ceiling or
roof systems which could endanger the structural integrity of the Building or
damage its floors, foundations or supporting structural components.  Tenant
shall not place any explosive, flammable or harmful fluids or other waste
materials in the drainage systems of the Leased Premises, the Building, the
Outside Areas or the Property.  Tenant shall not drain or discharge any fluids
in the landscaped areas or across the paved areas of the Property.  Tenant shall
not use any of the Outside Areas for the storage of its materials, supplies,
inventory or equipment and all such materials, supplies, inventory or equipment
shall at all times be stored within the Leased Premises.  Tenant shall not
commit nor permit to be committed any waste in or about the Leased Premises, the
Building, the Outside Areas or the Property.

4.3  Noise And Emissions.  All noise generated by Tenant in its use of the
Leased Premises shall be confined or muffled so that it does not interfere with
the businesses of the occupants and/or users of adjacent properties.  All dust,
fumes, odors and other emissions generated by Tenant’s use of the Leased
Premises shall be sufficiently dissipated in accordance with sound environmental
practice and exhausted from the Leased Premises in such a manner so as not to
interfere with the businesses of or annoy the occupants and/or users of adjacent
properties, or cause any damage to the Leased Premises, the Building, the
Outside Areas or the Property or any component part thereof or the property of
adjacent property owners.

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4.4  Trash Disposal.  Tenant shall provide trash bins or other adequate garbage
disposal facilities within the trash enclosure areas provided or permitted by
Landlord outside the Leased Premises sufficient for the interim disposal of all
of its trash, garbage and waste.  All such trash, garbage and waste temporarily
stored in such areas shall be stored in such a manner so that it is not visible
from outside of such areas, and Tenant shall cause such trash, garbage and waste
to be regularly removed from the Property.  Tenant shall keep the Leased
Premises and the Outside Areas in a clean, safe and neat condition free and
clear of all of Tenant’s trash, garbage, waste and/or boxes, pallets and
containers containing same at all times.

4.5  Parking.  Tenant shall not, at any time, park or permit to be parked any
recreational vehicles, inoperative vehicles or equipment in the Outside Areas or
on any portion of the Property.  Tenant agrees to assume responsibility for
compliance by its employees and invitees with the parking provisions contained
herein.  If Tenant or its employees park any vehicle within the Property in
violation of these provisions, then Landlord may, upon prior written notice to
Tenant giving Tenant one (1) day (or any applicable statutory notice period, if
longer than one (1) day) to remove such vehicle(s), in addition to any other
remedies Landlord may have under this Lease, charge Tenant, as Additional Rent,
and Tenant agrees to pay, as Additional Rent, One Hundred Dollars ($100) per day
for each day or partial day that each such vehicle is so parked within the
Property.  Landlord reserves the right to grant easements and access rights to
others for use of the parking areas on the Property, provided that such grants
do not materially interfere with Tenant’s use of the parking areas.

4.6  Signs.  Tenant shall not place or install on or within any portion of the
Leased Premises, the exterior of the Building, the Outside Areas or the Property
any sign, advertisement, banner, placard, or picture which is visible from the
exterior of the Leased Premises.  Tenant shall not place or install on or within
any portion of the Leased Premises, the exterior of the Building, the Outside
Areas or the Property any business identification sign which is visible from the
exterior of the Leased Premises until Landlord shall have approved in writing
and in its sole discretion the location, size, content, design, method of
attachment and material to be used in the making of such sign; provided,
however, that so long as such signs are normal and customary business
directional or identification signs within the Building, Tenant shall not be
required to obtain Landlord’s approval.  Any sign, once approved by Landlord,
shall be installed at Tenant’s sole cost and expense and only in strict
compliance with Landlord’s approval and any applicable Laws and Restrictions,
using a person approved by Landlord to install same.  Landlord may remove any
signs (which have not been approved in writing by Landlord), advertisements,
banners, placards or pictures so placed by Tenant on or within the Leased
Premises, the exterior of the Building, the Outside Areas or the Property and
charge to Tenant the cost of such removal, together with any costs incurred by
Landlord to repair any damage caused thereby, including any cost incurred to
restore the surface (upon which such sign was so affixed) to its original
condition.  Tenant shall remove all of Tenant’s signs, repair any damage caused
thereby, and restore the surface upon which the sign was affixed to its original
condition, all to Landlord’s reasonable satisfaction, upon the termination of
this Lease.

4.7  Compliance With Laws And Restrictions.  Tenant shall abide by and shall
promptly observe and comply with, at its sole cost and expense, all Laws and
Restrictions respecting the use and occupancy of the Leased Premises, the
Building, the Outside Areas or the Property including, without limitation,
Title 24, building codes, the Americans with Disabilities Act and the rules and
regulations promulgated thereunder, and all Laws governing the use and/or
disposal of hazardous materials, and shall defend with competent counsel,
indemnify and hold Landlord harmless from any claims, damages or liability
resulting from Tenant’s failure to so abide, observe, or comply.  Tenant’s
obligations hereunder shall survive the expiration or sooner termination of this
Lease.  Notwithstanding anything contained in this Lease to the contrary (except
for Paragraph 6.3 and the balance of this Paragraph 4.7, which shall control
with respect to the matters set forth therein), Tenant shall not be liable or
responsible financially for, and shall not be required to correct, any
violations of or noncompliance with such Laws or Restrictions if such violations
or noncompliance either (i) existed upon completion of the Landlord’s Work
(unless relating to the Tenant Improvements constructed by Tenant or its
contractor(s), or (ii) did not arise out of an act or omission by Tenant.

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4.8  Compliance With Insurance Requirements.  With respect to any insurance
policies required or permitted to be carried by Landlord in accordance with the
provisions of this Lease, Tenant shall not conduct nor permit any other person
to conduct any activities nor keep, store or use (or allow any other person to
keep, store or use) any item or thing within the Leased Premises, the Building,
the Outside Areas or the Property which (i) is prohibited under the terms of any
such policies, (ii) could result in the termination of the coverage afforded
under any of such policies, (iii) could give to the insurance carrier the right
to cancel any of such policies, or (iv) could cause an increase in the rates
(over standard rates) charged for the coverage afforded under any of such
policies.  Tenant shall comply with all requirements of any insurance company,
insurance underwriter, or Board of Fire Underwriters which are necessary to
maintain, at standard rates, the insurance coverages carried by either Landlord
or Tenant pursuant to this Lease.

4.9  Landlord’s Right To Enter.  Landlord and its agents shall have the right to
enter the Leased Premises during normal business hours after giving Tenant
reasonable notice and subject to Tenant’s reasonable security measures for the
purpose of (i) inspecting the same; (ii) showing the Leased Premises to
prospective purchasers, mortgagees or tenants; (iii) making necessary
alterations, additions or repairs; and (iv) performing any of Tenant’s
obligations when Tenant has failed to do so.  Landlord shall have the right to
enter the Leased Premises during normal business hours (or as otherwise agreed),
subject to Tenant’s reasonable security measures, for purposes of supplying any
maintenance or services agreed to be supplied by Landlord.  Landlord shall have
the right to enter the Outside Areas during normal business hours for purposes
of (i) inspecting the exterior of the Building and the Outside Areas;
(ii) posting notices of nonresponsibility (and for such purposes Tenant shall
provide Landlord at least thirty days’ prior written notice of any work to be
performed on the Leased Premises); and (iii) supplying any services to be
provided by Landlord.  Any entry into the Leased Premises or the Outside Areas
obtained by Landlord in accordance with this paragraph shall not under any
circumstances be construed or deemed to be a forcible or unlawful entry into, or
a detainer of, the Leased Premises, or an eviction, actual or constructive of
Tenant from the Leased Premises or any portion thereof.

4.10  Use Of Outside Areas.  Tenant, in its use of the Outside Areas, shall at
all times keep the Outside Areas in a safe condition free and clear of all
materials, equipment, debris, trash (except within existing enclosed trash
areas), inoperable vehicles, and other items which are not specifically
permitted by Landlord to be stored or located thereon by Tenant.  If, in the
opinion of Landlord, unauthorized persons are using any of the Outside Areas by
reason of, or under claim of, the express or implied authority or consent of
Tenant, then Tenant, upon demand of Landlord, shall restrain, to the fullest
extent then allowed by Law, such unauthorized use, and shall initiate such
appropriate proceedings as may be required to so restrain such use.  Landlord
reserves the right to grant easements and access rights to others for use of the
Outside Areas and shall not be liable to Tenant for any diminution in Tenant’s
right to use the Outside Areas as a result.

4.11  Environmental Protection.  Tenant’s obligations under this Paragraph 4.11
shall survive the expiration or termination of this Lease.

(a)  As used herein, the term “Hazardous Materials” shall mean any toxic or
hazardous substance, material or waste or any pollutant or infectious or
radioactive material, including but not limited to those substances, materials
or wastes regulated now or in the future under any of the following statutes or
regulations and any and all of those substances included within the definitions
of “hazardous substances,” “hazardous materials,” “hazardous waste,” “hazardous
chemical substance or mixture,” “imminently hazardous chemical substance or
mixture,” “toxic substances,” “hazardous air pollutant,” “toxic pollutant,” or
“solid waste” in the (a) Comprehensive Environmental Response, Compensation and
Liability Act of 1990 (“CERCLA” or “Superfund”), as amended by the Superfund
Amendments and Reauthorization Act of 1986 (“SARA”), 42 U.S.C. § 9601 et seq.,
(b) Resource Conservation and Recovery Act of 1976 (“RCRA”), 42 U.S.C. § 6901 et
seq., (c) Federal Water Pollution Control Act (“FSPCA”), 33 U.S.C. § 1251 et
seq., (d) Clean Air Act (“CAA”), 42 U.S.C. § 7401 et seq., (e) Toxic Substances
Control Act (“TSCA”), 14 U.S.C. § 2601 et seq., (f) Hazardous Materials
Transportation Act, 49 U.S.C. § 1801, et seq., (g) Carpenter-Presley-Tanner
Hazardous Substance Account Act (“California Superfund”), Cal. Health & Safety
Code § 25300 et seq., (h) California Hazardous

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Waste Control Act, Cal. Health & Safety code § 25100 et seq., (i) Porter-Cologne
Water Quality Control Act (“Porter-Cologne Act”), Cal. Water Code § 13000 et
seq., (j) Hazardous Waste Disposal Land Use Law, Cal. Health & Safety codes
§ 25220 et seq., (k) Safe Drinking Water and Toxic Enforcement Act of 1986
(“Proposition 65”), Cal. Health & Safety code § 25249.5 et seq., (l) Hazardous
Substances Underground Storage Tank Law, Cal. Health & Safety code § 25280 et
seq., (m) Air Resources Law, Cal. Health & Safety Code § 39000 et seq., and
(n) regulations promulgated pursuant to said laws or any replacement thereof, or
as similar terms are defined in the federal, state and local laws, statutes,
regulations, orders or rules.  Hazardous Materials shall also mean any and all
other biohazardous wastes and substances, materials and wastes which are, or in
the future become, regulated under applicable Laws for the protection of health
or the environment, or which are classified as hazardous or toxic substances,
materials or wastes, pollutants or contaminants, as defined, listed or regulated
by any federal, state or local law, regulation or order or by common law
decision, including, without limitation, (i) trichloroethylene,
tetrachloroethylene, perchloroethylene and other chlorinated solvents, (ii) any
petroleum products or fractions thereof, (iii) asbestos, (iv) polychlorinated
biphenyls, (v) flammable explosives, (vi) urea formaldehyde, (vii) radioactive
materials and waste, and (viii) materials and wastes that are harmful to or may
threaten human health, ecology or the environment.

(b)  Notwithstanding anything to the contrary in this Lease, Tenant, at its sole
cost, shall comply with all Laws relating to the storage, use and disposal of
Hazardous Materials; provided, however, that Tenant shall not be responsible for
contamination of the Leased Premises by Hazardous Materials present on, in or
under the Leased Premises as of the date the Leased Premises are delivered to
Tenant (whether before or after the Lease Commencement Date) unless brought onto
the Leased Premises by Tenant.  Tenant shall not store, use or dispose of any
Hazardous Materials on the Leased Premises except for small quantities of
Hazardous Materials typically present in office settings, e.g., copier fluids,
cleaning fluids (“Permitted Small Quantities”) or those Hazardous Materials
listed in a Hazardous Materials management plan (“HMMP”) which Tenant shall
deliver to Landlord upon execution of this Lease and update at least annually
with Landlord (collectively, “Permitted Materials”) which may be used, stored
and disposed of provided (i) such Permitted Materials are used, stored,
transported, and disposed of in strict compliance with applicable laws,
(ii) such Permitted Materials (other than the Permitted Small Quantities) shall
be limited to the materials listed on and may be used only in the quantities
specified in the HMMP, and (iii) Tenant shall provide Landlord with copies of
all material safety data sheets and other documentation required under
applicable Laws in connection with Tenant’s use of Permitted Materials as and
when such documentation is provided to any regulatory authority having
jurisdiction.  In no event shall Tenant cause or permit to be discharged into
the plumbing or sewage system of the Building or onto the land underlying or
adjacent to the Building any Hazardous Materials.  Tenant shall be solely
responsible for and shall defend, indemnify, and hold Landlord and its agents
harmless from and against all claims, costs and liabilities, including
attorneys’ fees and costs, arising out of or in connection with Tenant’s
storage, use and/or disposal of Hazardous Materials.  If the presence of
Hazardous Materials on the Leased Premises caused or permitted by Tenant results
in contamination or deterioration of water or soil, then Tenant shall promptly
take any and all action necessary to remediate such contamination, but the
foregoing shall in no event be deemed to constitute permission by Landlord to
allow the presence of such Hazardous Materials.  At any time prior to the
expiration of the Lease Term if Tenant has a reasonable basis to suspect that
there has been any release or the presence of Hazardous Materials in the ground
or ground water on the Leased Premises which did not exist upon commencement of
the Lease Term, Tenant shall have the right to conduct appropriate tests of
water and soil and to deliver to Landlord the results of such tests to
demonstrate that no contamination in excess of actionable levels has occurred as
a result of Tenant’s use of the Leased Premises.  Tenant shall further be solely
responsible for, and shall defend, indemnify, and hold Landlord and its agents
harmless from and against all claims, costs and liabilities, including
attorneys’ fees and costs, arising out of or in connection with any remediation,
removal, and restoration work and materials required by applicable Laws as the
result of Hazardous Materials brought onto or permitted to enter the Premises by
Tenant in order to remediate the Leased Premises and any other property of
whatever nature so as to be in compliance with applicable Laws.

(c)  Upon termination or expiration of the Lease Term, Tenant at its sole
expense shall cause all Hazardous Materials placed in or about the Leased
Premises, the Building and/or the Property by Tenant, its

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agents, contractors, or invitees, and all installations (whether interior or
exterior) made by or on behalf of Tenant relating to the storage, use, disposal
or transportation of Hazardous Materials to be remediated in accordance and
compliance with all Laws and Restrictions respecting Hazardous Materials used or
permitted to be used by Tenant.  Tenant shall apply for and shall obtain from
all appropriate regulatory authorities (including any applicable fire department
or regional water quality control board) all permits, approvals and clearances
necessary for the closure of the Property as the result of Hazardous Materials
brought onto or permitted to enter the Leased Premises by Tenant and shall take
all other actions as may be required to complete the closure of the Building and
the Property as the result of Hazardous Materials brought onto or permitted to
enter the Leased Premises by Tenant.  In addition, if Landlord then has a
reasonable basis to believe that Tenant may have liability under this Article,
then prior to vacating the Leased Premises, Tenant shall undertake and submit to
Landlord an environmental site assessment from an environmental consulting
company reasonably acceptable to Landlord which site assessment shall evidence
Tenant’s compliance with this Paragraph 4.11.

(d)  At any time prior to expiration of the Lease Term, subject to reasonable
prior notice (not less than forty-eight (48) hours) and Tenant’s reasonable
security requirements and provided such activities do not unreasonably interfere
with the conduct of Tenant’s business at the Leased Premises, Landlord shall
have the right to enter in and upon the Property, Building and Leased Premises
in order to conduct appropriate tests of water and soil to determine whether
levels of any Hazardous Materials in excess of legally permissible levels has
occurred as a result of Tenant’s use thereof.  Landlord shall furnish copies of
all such test results and reports to Tenant and, at Tenant’s option and cost,
shall permit split sampling for testing and analysis by Tenant.  Such testing
shall be at Tenant’s expense if Landlord has a reasonable basis for suspecting
and confirms the presence of Hazardous Materials in the soil or surface or
ground water in, on, under, or about the Property, the Building or the Leased
Premises, which has been caused by or resulted from the activities of Tenant,
its agents, contractors, or invitees.

(e)  Landlord may voluntarily cooperate in a reasonable manner with the efforts
of all governmental agencies in reducing actual or potential environmental
damage.  Tenant shall not be entitled to terminate this Lease or to any
reduction in or abatement of rent by reason of such voluntary cooperation, nor
for any required compliance.  Tenant agrees at all times to cooperate fully with
the requirements and recommendations of governmental agencies regulating, or
otherwise involved in, the protection of the environment.

4.12  Rules And Regulations.  In the event Palo Alto Networks is no longer the
sole tenant of the Leased Premises, Landlord shall have the right from time to
time to establish reasonable rules and regulations and/or amendments or
additions thereto respecting the use of the Leased Premises and the Outside
Areas for the care and orderly management of the Property.  Upon delivery to
Tenant of a copy of such rules and regulations or any amendments or additions
thereto, Tenant shall comply with such rules and regulations.  A violation by
Tenant of any of such rules and regulations shall constitute a default by Tenant
under this Lease.  If there is a conflict between the rules and regulations and
any of the provisions of this Lease, the provisions of this Lease shall prevail.
 Landlord shall not be responsible or liable to Tenant for the violation of such
rules and regulations by any other tenant of the Property.

4.13  Reservations.  Landlord reserves the right from time to time to grant,
without the consent or joinder of Tenant, such easements, rights of way and
dedications that Landlord deems necessary, and to cause the recordation of
parcel maps and restrictions, so long as such easements, rights of way and
dedications do not unreasonably interfere with the use of the Leased Premises by
Tenant.  Tenant agrees to execute any documents reasonably requested by Landlord
to effectuate any such easement rights, dedications, maps or restrictions.

Article 5
REPAIRS, MAINTENANCE, SERVICES AND UTILITIES

5.1  Repair And Maintenance.  Except in the case of damage to or destruction of
the Leased Premises, the Building, the Outside Areas or the Property caused by
an act of God or other peril, in which case the provisions

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of Article 10 shall control, the parties shall have the following obligations
and responsibilities with respect to the repair and maintenance of the Leased
Premises, the Building, the Outside Areas, and the Property.

(a)  Tenant’s Obligations.  Tenant shall, at all times during the Lease Term and
at its sole cost and expense, regularly clean and continuously keep and maintain
in good order, condition and repair the Leased Premises and every part thereof
including, without limiting the generality of the foregoing, (i) all interior
walls, floors and ceilings, (ii) all windows, doors and skylights, (iii) all
electrical wiring, conduits, connectors and fixtures, (iv) all plumbing, pipes,
sinks, toilets, faucets and drains, (v) all lighting fixtures, bulbs and lamps,
elevators, and all heating, ventilating and air conditioning equipment, and
(vi) all entranceways to the Leased Premises.  Tenant, if requested to do so by
Landlord, shall hire, at Tenant’s sole cost and expense, a licensed heating,
ventilating and air conditioning contractor to regularly and periodically (not
less frequently than every three months) inspect and perform required
maintenance on the heating, ventilating and air conditioning equipment and
systems serving the Leased Premises, or alternatively, Landlord may, at its
election, contract in its own name for such regular and periodic inspections of
and maintenance on such heating, ventilating and air conditioning equipment and
systems and charge to Tenant, as Additional Rent, the cost thereof.  Tenant
shall, at all times during the Lease Term, keep in a clean and safe condition
the Outside Areas.  Tenant shall regularly and periodically sweep and clean the
driveways and parking areas.  Tenant shall, at its sole cost and expense, repair
all damage to the Leased Premises, the Building, the Outside Areas or the
Property caused by the activities of Tenant, its employees, invitees or
contractors promptly following written notice from Landlord to so repair such
damages.  If Tenant shall fail to perform the required maintenance or fail to
make repairs required of it pursuant to this paragraph within a reasonable
period of time following notice from Landlord to do so, then Landlord may, at
its election and without waiving any other remedy it may otherwise have under
this Lease or at law, perform such maintenance or make such repairs and charge
to Tenant, as Additional Rent, the costs so incurred by Landlord for same.  All
glass within or a part of the Leased Premises, both interior and exterior, is at
the sole risk of Tenant and any broken glass shall promptly be replaced by
Tenant at Tenant’s expense with glass of the same kind, size and quality.

(b)  Landlord’s Obligation.  Landlord shall, at all times during the Lease Term,
maintain in good condition and repair the foundation, roof structure,
load-bearing and exterior walls of the Building (excluding paint), and main
underground utilities (if any) beneath the Building slab.  In addition, Landlord
shall hire a licensed roofing contractor to regularly and periodically inspect
and perform required maintenance on the roof of the Leased Premises.  The
provisions of this subparagraph (b) shall in no way limit the right of Landlord
to charge to Tenant, as Additional Rent pursuant to Article 3 (to the extent
permitted pursuant to Article 3), the costs incurred by Landlord in performing
such maintenance and/or making such repairs.

5.2  Utilities.  Tenant shall arrange at its sole cost and expense and in its
own name, for the supply of gas and electricity to the Leased Premises.  In the
event that such services are not separately metered, Tenant shall, at its sole
expense, cause such meters to be installed.  Landlord shall maintain the water
meter(s) in its own name; provided, however, that if at any time during the
Lease Term Landlord shall require Tenant to put the water service in Tenant’s
name, Tenant shall do so at Tenant’s sole cost.  Tenant shall be responsible for
determining if the local supplier of water, gas and electricity can supply the
needs of Tenant and whether or not the existing water, gas and electrical
distribution systems within the Building and the Leased Premises are adequate
for Tenant’s needs.  Tenant shall be responsible for determining if the existing
sanitary and storm sewer systems now servicing the Leased Premises and the
Property are adequate for Tenant’s needs.  Tenant shall pay all charges for
water, gas, electricity and storm and sanitary sewer services as so supplied to
the Leased Premises, irrespective of whether or not the services are maintained
in Landlord’s or Tenant’s name.

5.3  Security.  Tenant acknowledges that Landlord has not undertaken any duty
whatsoever to provide security for the Leased Premises, the Building, the
Outside Areas or the Property and, accordingly, Landlord is not responsible for
the security of same or the protection of Tenant’s property or Tenant’s
employees, invitees, or contractors from any cause whatsoever, including but not
limited to criminal and/or terrorist acts.  To the extent Tenant determines that
such security or protection services are advisable or necessary, Tenant shall
arrange for and

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pay the costs of providing same.  In the event Landlord in its sole and absolute
discretion agrees to provide any security services, whether it be guard service
or access systems or otherwise, Landlord shall do so strictly as an
accommodation to Tenant and Landlord shall have no liability whatsoever in
connection therewith, whether it be for failure to maintain the secure access
system, or for failure of the guard service to provide adequate security, or
otherwise.  Without limitation, Paragraph 8.1 below is intended by Tenant and
Landlord to apply to this Paragraph 5.3.

5.4  Energy And Resource Consumption.  Landlord may voluntarily cooperate in a
reasonable manner with the efforts of governmental agencies and/or utility
suppliers in reducing energy or other resource consumption within the Property.
 Landlord shall make reasonable commercial efforts to minimize negative impact
of any such cooperation on Tenant’s conduct of its business.  Tenant shall not
be entitled to terminate this Lease or to any reduction in or abatement of rent
by reason of such reasonable cooperation unless a knowledgeable commercially
experienced person familiar with Tenant’s customary business would conclude that
such negative impact made the Premises unsuitable for the commercially
reasonable conduct of Tenant’s customary business.  Tenant agrees at all times
to cooperate fully with Landlord and to abide by all reasonable rules
established by Landlord (i) in order to maximize the efficient operation of the
electrical, heating, ventilating and air conditioning systems and all other
energy or other resource consumption systems with the Property and/or (ii) in
order to comply with the recommendations of utility suppliers and governmental
agencies regulating the consumption of energy and/or other resources.

5.5  Limitation Of Landlord’s Liability.  Landlord shall not be liable to Tenant
for injury to Tenant, its employees, agents, invitees or contractors, damage to
Tenant’s property or loss of Tenant’s business or profits, nor shall Tenant be
entitled to terminate this Lease or to any reduction in or abatement of rent by
reason of (i) Landlord’s failure to provide security services or systems within
the Property for the protection of the Leased Premises, the Building or the
Outside Areas, or the protection of Tenant’s property or Tenant’s employees,
invitees, agents or contractors, or (ii) Landlord’s failure to perform any
maintenance or repairs to the Leased Premises, the Building, the Outside Areas
or the Property until Tenant shall have first notified Landlord, in writing, of
the need for such maintenance or repairs, and then only after Landlord shall
have had a reasonable period of time following its receipt of such notice within
which to perform such maintenance or repairs, or (iii) any failure,
interruption, rationing or other curtailment in the supply of water, electric
current, gas or other utility service to the Leased Premises, the Building, the
Outside Areas or the Property from whatever cause (other than Landlord’s gross
negligence or willful misconduct), or (iv) the unauthorized intrusion or entry
into the Leased Premises by third parties (other than Landlord).

Article 6
ALTERATIONS AND IMPROVEMENTS

6.1  By Tenant.  Tenant shall not make any alterations to or modifications of
the Leased Premises or construct any improvements within the Leased Premises
until Landlord shall have first approved, in writing, the plans and
specifications therefor, which approval shall not be unreasonably withheld,
conditioned or delayed.  Tenant’s written request shall also contain a request
for Landlord to elect whether or not it will require Tenant to remove the
subject alterations, modifications or improvements at the expiration or earlier
termination of this Lease and Landlord’s removal/no removal decision shall be
delivered to Tenant simultaneously with its approval of such alternations or
modifications.  If such additional request is not included, Landlord may make
such election at the expiration or earlier termination of this Lease (and for
purposes of Tenant’s removal obligations set forth in Paragraph 2.6 above,
Landlord shall be deemed to have made the election at the time the alterations,
modifications or improvements were completed).  All such modifications,
alterations or improvements, once so approved, shall be made, constructed or
installed by Tenant at Tenant’s expense (including all permit fees and
governmental charges related thereto), using a licensed contractor first
approved by Landlord, in substantial compliance with the Landlord-approved plans
and specifications therefor.  All work undertaken by Tenant shall be done in
accordance with all Laws and Restrictions and in a good and workmanlike manner
using new materials of good quality.  Tenant shall not commence the making of
any such modifications or alterations or the construction of any such

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improvements until (i) all required governmental approvals and permits shall
have been obtained, (ii) all requirements regarding insurance imposed by this
Lease have been satisfied, (iii) Tenant shall have given Landlord at least five
(5) business days prior written notice of its intention to commence such work so
that Landlord may post and file notices of non-responsibility, and (iv) if
requested by Landlord, Tenant shall have obtained contingent liability and broad
form builder’s risk insurance in an amount satisfactory to Landlord in its
reasonable discretion to cover any perils relating to the proposed work not
covered by insurance carried by Tenant pursuant to Article 9.  In no event shall
Tenant make any modification, alterations or improvements whatsoever to the
Outside Areas or the exterior or structural components of the Building
including, without limitation, any cuts or penetrations in the floor, roof or
exterior walls of the Leased Premises.  As used in this Article, the term
“modifications, alterations and/or improvements” shall include, without
limitation, the installation of additional electrical outlets, overhead lighting
fixtures, drains, sinks, partitions, doorways, or the like.

6.2  Ownership Of Improvements.  All modifications, alterations and improvements
made or added to the Leased Premises by Tenant (other than Tenant’s inventory,
equipment, movable furniture, wall decorations and trade fixtures) shall be
deemed real property and a part of the Leased Premises, but shall remain the
property of Tenant during the Lease, and Tenant hereby covenants and agrees not
to grant a security interest in any such items to any party other than Landlord.
 Any such modifications, alterations or improvements, once completed, shall not
be altered or removed from the Leased Premises during the Lease Term without
Landlord’s written approval first obtained in accordance with the provisions of
Paragraph 6.1 above.  At the expiration or sooner termination of this Lease, all
such modifications, alterations and improvements other than Tenant’s inventory,
equipment, movable furniture, wall decorations and trade fixtures, shall
automatically become the property of Landlord and shall be surrendered to
Landlord as part of the Leased Premises as required pursuant to Article 2,
unless Landlord shall require Tenant to remove any of such modifications,
alterations or improvements in accordance with the provisions of Article 2, in
which case Tenant shall so remove same.  Landlord shall have no obligations to
reimburse Tenant for all or any portion of the cost or value of any such
modifications, alterations or improvements so surrendered to Landlord.  All
modifications, alterations or improvements which are installed or constructed on
or attached to the Leased Premises by Landlord and/or at Landlord’s expense
shall be deemed real property and a part of the Leased Premises and shall be
property of Landlord.  All lighting, plumbing, electrical, heating, ventilating
and air conditioning fixtures, partitioning, window coverings, wall coverings
and floor coverings installed by Tenant shall be deemed improvements to the
Leased Premises and not trade fixtures of Tenant.

6.3  Alterations Required By Law.  Tenant shall make all modifications,
alterations and improvements to the Leased Premises, at its sole cost, that are
required by any Law because of (i) Tenant’s particular use of the Leased
Premises, the Building, the Outside Areas or the Property, (ii) Tenant’s
application for any permit or governmental approval, or (iii) Tenant’s making of
any modifications, alterations or improvements to or within the Leased Premises.
 If Landlord shall, at any time during the Lease Term, be required by any
governmental authority to make any modifications, alterations or improvements to
the Building or the Property, the cost incurred by Landlord in making such
modifications, alterations or improvements, including interest at a rate equal
to the greater of (a) 8% per annum, or (b) the sum of that rate per annum quoted
by Wells Fargo Bank, N.T. & S.A., from time to time as its prime rate, plus two
percent (2%) (“Wells Prime Plus Two”) (but in no event more than the maximum
rate of interest not prohibited or made usurious), shall be amortized by
Landlord over the useful life of such modifications, alterations or
improvements, as determined in accordance with generally accepted accounting
principles, and the monthly amortized cost of such modifications, alterations
and improvements as so amortized shall be considered a Property Maintenance
Cost.

6.4  Liens.  Tenant shall keep the Property and every part thereof free from any
lien, and shall pay when due all bills arising out of any work performed,
materials furnished, or obligations incurred by Tenant, its agents, employees or
contractors relating to the Property.  If any such claim of lien is recorded
against Tenant’s interest in this Lease, the Property or any part thereof,
Tenant shall bond against, discharge or otherwise cause such lien to be entirely
released within ten days after the same has been recorded.  Tenant’s failure to
do so shall be conclusively deemed a material default under the terms of this
Lease.

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Article 7
ASSIGNMENT AND SUBLETTING BY TENANT

7.1  By Tenant.  Tenant shall not sublet the Leased Premises or any portion
thereof or assign its interest in this Lease, or permit the occupancy of the
Premises by other than Tenant, whether voluntarily or by operation of Law,
without Landlord’s prior written consent which shall not be unreasonably
withheld, conditioned, or delayed.  Any attempted subletting or assignment, or
occupancy of the Leased Premises by other than Tenant, without Landlord’s prior
written consent, at Landlord’s election, shall constitute a default by Tenant
under the terms of this Lease.  The acceptance of rent by Landlord from any
person or entity other than Tenant, or the acceptance of rent by Landlord from
Tenant with knowledge of a violation of the provisions of this paragraph, shall
not be deemed to be a waiver by Landlord of any provision of this Article or
this Lease or to be a consent to any subletting by Tenant or any assignment of
Tenant’s interest in this Lease.  Without limiting the circumstances in which it
may be reasonable for Landlord to withhold its consent to an assignment or
subletting, Landlord and Tenant acknowledge that it shall be reasonable for
Landlord to withhold its consent in the following instances:

(a)  the proposed assignee or sublessee is a governmental agency;

(b)  in Landlord’s reasonable judgment, the use of the Leased Premises by the
proposed assignee or sublessee would involve occupancy other than for a
Permitted Use, would entail any alterations which would lessen the value of the
leasehold improvements in the Leased Premises, or would require increased
services by Landlord;

(c)  in Landlord’s reasonable judgment, the credit-worthiness of the proposed
assignee is less than that of Tenant or does not meet the credit standards
applied by Landlord;

(d)  the proposed assignee or sublessee (or any of its affiliates) has been in
material default under a lease, has been in litigation with a previous landlord,
or in the ten years prior to the assignment or sublease has filed for bankruptcy
protection, has been the subject of an involuntary bankruptcy, or has been
adjudged insolvent;

(e)  Landlord (or any of its affiliates) has experienced a previous default by
or is in litigation with the proposed assignee or sublessee (or any of their
affiliates);

(f)  in Landlord’s reasonable judgment, the Leased Premises, or the relevant
part thereof, will be used in a manner that will violate any negative covenant
as to use contained in this Lease;

(g)  the use of the Leased Premises by the proposed assignee or sublessee will
violate any Law or Restriction;

(h)  the proposed assignment or sublease fails to include all of the terms and
provisions required to be included therein pursuant to this Article 7;

(i)  an Event of Default exists under this Lease, or Tenant has materially
defaulted under this Lease on three or more occasions during the 12 months
preceding the date that Tenant shall request consent; or

(j)  in the case of a subletting of less than the entire Leased Premises, if the
subletting would result in the division of the Leased Premises into more than
two subparcels or would require improvements to be made outside of the Leased
Premises.

7.2  Merger, Reorganization, or Sale of Assets.  Any dissolution, merger,
consolidation or other reorganization of Tenant, or the sale or other transfer
in the aggregate over the Lease Term of a controlling percentage of the capital
stock of or other equity interests in Tenant (excluding original issuances of
equity interests to venture capitalists and original issuances of equity
interests to other financing parties), or the sale or transfer of all or a
substantial portion of the assets of Tenant, shall be deemed a voluntary
assignment of Tenant’s

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interest in this Lease.  The phrase “controlling percentage” means the direct or
indirect ownership of or right to vote (i) stock possessing more than fifty
percent of the total combined voting power of all classes of Tenant’s capital
stock issued, outstanding and entitled to vote for the election of directors, or
(ii) equity interests possessing the ability to direct the management of Tenant.
 If Tenant is a partnership, a withdrawal or change, voluntary, involuntary or
by operation of Law, of any general partner, or the dissolution of the
partnership, shall be deemed a voluntary assignment of Tenant’s interest in this
Lease.  Upon Landlord’s request from time to time, Tenant shall promptly provide
Landlord with a statement certified by the Tenant’s chief executive officer or
chief financial officer, which shall provide the following information: (a) the
names of all of Tenant’s shareholders and their ownership interests at the time
thereof, provided Tenant’s shares are not publicly traded; (b) the state in
which Tenant is incorporated; (c) the location of Tenant’s principal place of
business; (d) information regarding a material change in the corporate structure
of Tenant, including, without limitation, a merger or consolidation; and (e) any
other information regarding Tenant’s ownership that Landlord reasonably
requests.  In the event of an acquisition by one entity of the controlling
percentage of the capital stock of Tenant where this Lease is not assigned to
and assumed in full by such entity, it shall be a condition to Landlord’s
consent to such change in control that such entity acquiring the controlling
percentage assume, as a primary obligor, all rights and obligations of Tenant
under this Lease (and such entity shall execute all documents reasonably
required to effectuate such assumption).  All information received by Landlord
pursuant to this Paragraph 7.2 shall be held by Landlord as confidential
information and shall not be disclosed by Landlord to any third party without
Tenant’s prior written consent; provided, however, that Landlord may disclose
such information to its current and prospective lenders, investors, purchasers
of its assets, attorneys, and accountants, so long as it informs such persons
that the information is not to be further disclosed.

7.3  Landlord’s Election.  If Tenant shall desire to assign its interest under
the Lease or to sublet the Leased Premises, Tenant must first notify Landlord,
in writing, of its intent to so assign or sublet, at least thirty (30) days in
advance of taking any action with respect thereto.  Once Tenant (or Landlord or
both pursuant to the joint marketing election described below) has identified a
potential assignee or sublessee, Tenant shall notify Landlord, in writing, of
its intent to so assign or sublet, at least thirty (30) days in advance of the
date it intends to so assign its interest in this Lease or sublet the Leased
Premises but not sooner than one hundred eighty days in advance of such date,
specifying in detail the terms of such proposed assignment or subletting,
including the name of the proposed assignee or sublessee, the proposed
assignee’s or sublessee’s intended use of the Leased Premises, current financial
statements (including a balance sheet, income statement and statement of cash
flow, all prepared in accordance with generally accepted accounting principles)
of such proposed assignee or sublessee, the form of documents to be used in
effectuating such assignment or subletting and such other information as
Landlord may reasonably request.  Landlord shall have a period of ten
(10) business days following receipt of such notice and the required information
within which to do one of the following: (i) consent to such requested
assignment or subletting subject to Tenant’s compliance with the conditions set
forth in Paragraph 7.4 below, or (ii) refuse to so consent to such requested
assignment or subletting, provided that such consent shall not be unreasonably
refused, or (iii) terminate this Lease as to the portion of the Leased Premises
as is the subject of the proposed assignment or subletting (such termination to
be effective either (A) on the date specified in Tenant’s notice as the intended
effective date of the assignment or subletting, or (B) on such tenth
(10th) business day after receipt of Tenant’s notice, at Landlord’s option).
 During such ten (10) business day period, Tenant covenants and agrees to supply
to Landlord, upon request, all necessary or relevant information which Landlord
may reasonably request respecting such proposed assignment or subletting and/or
the proposed assignee or sublessee.  In the event of an election by Landlord
under clause (iii) above, Landlord shall have the right to enter into a direct
lease with the proposed assignee or sublessee without payment of any
consideration to Tenant.  In addition, in the event Tenant desires to sublease
all or a portion of the Leased Premises, Landlord shall have the right to elect
to jointly market with Tenant the applicable portion (including all) of the
Leased Premises for subleasing and/or direct leasing, such joint marketing
election to be made, if at all, in writing and delivered to Tenant during the
thirty (30) day period described in the first sentence of this Paragraph 7.3.

7.4  Conditions To Landlord’s Consent.  If Landlord elects to consent, or shall
have been ordered to so consent by a court of competent jurisdiction, to such
requested assignment or subletting, such consent shall be

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expressly conditioned upon the occurrence of each of the conditions below set
forth, and any purported assignment or subletting made or ordered prior to the
full and complete satisfaction of each of the following conditions shall be void
and, at the election of Landlord, which election may be exercised at any time
following such a purported assignment or subletting but prior to the
satisfaction of each of the stated conditions, shall constitute a material
default by Tenant under this Lease until cured by satisfying in full each such
condition by the assignee or sublessee.  The conditions are as follows:

(a)  Landlord having approved in form and substance the assignment or sublease
agreement and any ancillary documents, which approval shall not be unreasonably
withheld by Landlord if the requirements of this Article 7 are otherwise
complied with.

(b)  Each such sublessee or assignee having agreed, in writing satisfactory to
Landlord and its counsel and for the benefit of Landlord, in the case of an
assignee to assume, to be bound by, and to perform the obligations of this Lease
to be performed by Tenant and in the case of a sublease to be bound by and to
perform the obligations of the sublease, which relate to space being subleased.

(c)  Tenant having fully and completely performed all of its obligations under
the terms of this Lease through and including the date of such assignment or
subletting.

(d)  Tenant having reimbursed to Landlord all reasonable costs and reasonable
attorneys’ fees incurred by Landlord in conjunction with the processing and
documentation of any such requested subletting or assignment.  Tenant shall be
obligated to so reimburse Landlord whether or not such subletting or assignment
is completed.

(e)  Tenant having delivered to Landlord a complete and fully-executed duplicate
original of such sublease agreement or assignment agreement (as applicable) and
all related agreements.

(f)  Tenant having paid, or having agreed in writing to pay as to future
payments, to Landlord fifty percent (50%) of all assignment consideration or
excess rentals to be paid to Tenant or to any other on Tenant’s behalf or for
Tenant’s benefit for such assignment or subletting as follows:

(i)  If Tenant assigns its interest under this Lease and if all or a portion of
the consideration for such assignment is to be paid by the assignee at the time
of the assignment, that Tenant shall have paid to Landlord and Landlord shall
have received an amount equal to fifty percent (50%) of the assignment
consideration so paid or to be paid (whichever is the greater) at the time of
the assignment by the assignee; or

(ii)  If Tenant assigns its interest under this Lease and if Tenant is to
receive all or a portion of the consideration for such assignment in future
installments, that Tenant and Tenant’s assignee shall have entered into a
written agreement with and for the benefit of Landlord satisfactory to Landlord
and its counsel whereby Tenant and Tenant’s assignee jointly agree to pay to
Landlord an amount equal to fifty percent (50%) of all such future assignment
consideration installments to be paid by such assignee as and when such
assignment consideration is so paid; or

(iii)  If Tenant subleases the Leased Premises, that Tenant and Tenant’s
sublessee shall have entered into a written agreement with and for the benefit
of Landlord satisfactory to Landlord and its counsel whereby Tenant and Tenant’s
sublessee jointly agree to pay to Landlord fifty percent (50%) of all excess
rentals to be paid by such sublessee.

7.5  Assignment Consideration And Excess Rentals Defined.  For purposes of this
Article, including any amendment to this Article by way of addendum or other
writing, the term “assignment consideration” shall mean all consideration to be
paid by the assignee to Tenant or to any other party on Tenant’s behalf or for
Tenant’s benefit as consideration for such assignment, after deduction for
market rate, third party leasing commissions, tenant improvements made for the
purpose of inducing the assignee, and reasonable attorneys’ fees incurred by

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Tenant in connection with such assignment, and the term “excess rentals” shall
mean all consideration to be paid by the sublessee to Tenant or to any other
party on Tenant’s behalf or for Tenant’s benefit for the sublease of all or any
portion of the Leased Premises in excess of the rent due to Landlord under the
terms of this Lease for the portion so subleased for the same period, after
deduction for market rate, third party leasing commissions, tenant improvements
made for the purpose of inducing the sublessee, and reasonable attorneys’ fees
incurred by Tenant in connection with such sublease.  Tenant agrees that the
portion of any assignment consideration and/or excess rentals arising from any
assignment or subletting by Tenant which is to be paid to Landlord pursuant to
this Article now is and shall then be the property of Landlord and not the
property of Tenant.

7.6  Payments.  All payments required by this Article to be made to Landlord
shall be made in cash in full as and when they become due.  At the time Tenant,
Tenant’s assignee or sublessee makes each such payment to Landlord, Tenant or
Tenant’s assignee or sublessee, as the case may be, shall deliver to Landlord an
itemized statement in reasonable detail showing the method by which the amount
due Landlord was calculated and certified by the party making such payment as
true and correct.

7.7  Good Faith.  The rights granted to Tenant by this Article are granted in
consideration of Tenant’s express covenant, which Tenant hereby makes, that all
pertinent allocations which are made by Tenant between the rental value of the
Leased Premises and the value of any of Tenant’s personal property which may be
conveyed or leased (or services provided) generally concurrently with and which
may reasonably be considered a part of the same transaction as the permitted
assignment or subletting shall be made fairly, honestly and in good faith.  If
Tenant shall breach this covenant, Landlord may immediately declare Tenant to be
in default under the terms of this Lease and terminate this Lease and/or
exercise any other rights and remedies Landlord would have under the terms of
this Lease in the case of a material default by Tenant under this Lease.

7.8  Effect Of Landlord’s Consent.  No subletting or assignment, even with the
consent of Landlord, shall relieve Tenant of its personal and primary obligation
to pay rent and to perform all of the other obligations to be performed by
Tenant hereunder.  Consent by Landlord to one or more assignments of Tenant’s
interest in this Lease or to one or more sublettings of the Leased Premises
shall not be deemed to be a consent to any subsequent assignment or subletting.
 No subtenant shall have any right to assign its sublease or to further sublet
any portion of the sublet premises or to permit any portion of the sublet
premises to be used or occupied by any other party.  No sublease may be
terminated or modified without Landlord’s prior written consent.  If Landlord
shall have been ordered by a court of competent jurisdiction to consent to a
requested assignment or subletting, or such an assignment or subletting shall
have been ordered by a court of competent jurisdiction over the objection of
Landlord, such assignment or subletting shall not be binding between the
assignee (or sublessee) and Landlord until such time as all conditions set forth
in Paragraph 7.4 above have been fully satisfied (to the extent not then
satisfied) by the assignee or sublessee, including, without limitation, the
payment to Landlord of all agreed assignment considerations and/or excess
rentals then due Landlord.  Upon a default while a sublease is in effect,
Landlord may collect directly from the sublessee all sums becoming due to Tenant
under the sublease and apply this amount against any sums due Landlord by
Tenant, and Tenant authorizes and directs any sublessee to make payments
directly to Landlord upon notice from Landlord.  No direct collection by
Landlord from any sublessee shall constitute a novation or release of Tenant or
any guarantor, a consent to the sublease or a waiver of the covenant prohibiting
subleases.  Landlord, as Tenant’s agent, may endorse any check, draft or other
instrument payable to Tenant for sums due under a sublease, and apply the
proceeds in accordance with this Lease; this agency is coupled with an interest
and is irrevocable.

Article 8
LIMITATION ON LANDLORD’S LIABILITY AND INDEMNITY

8.1  Limitation On Landlord’s Liability And Release.  Landlord shall not be
liable to Tenant for, and Tenant hereby releases and waives all claims and
rights of recovery against Landlord and its partners, principals, members,
managers, officers, agents, employees, lenders, attorneys, contractors,
invitees, consultants, predecessors, successors and assigns (including without
limitation prior and subsequent owners of the Property or

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portions thereof) (collectively, the “Landlord Indemnitees”) from, any and all
liability, whether in contract, tort or on any other basis, for any injury to or
any damage sustained by Tenant, Tenant’s agents, employees, contractors or
invitees, any damage to Tenant’s property, or any loss to Tenant’s business,
loss of Tenant’s profits or other financial loss of Tenant resulting from or
attributable to the condition of, the management of, the repair or maintenance
of, the protection of, the supply of services or utilities to, the damage in or
destruction of the Leased Premises, the Building, the Property or the Outside
Areas, including without limitation (i) the failure, interruption, rationing or
other curtailment or cessation in the supply of electricity, water, gas or other
utility service to the Property, the Building or the Leased Premises; (ii) the
vandalism or forcible entry into the Building or the Leased Premises; (iii) the
penetration of water into or onto any portion of the Leased Premises; (iv) the
failure to provide security and/or adequate lighting in or about the Property,
the Building or the Leased Premises, (v) the existence of any design or
construction defects within the Property, the Building or the Leased Premises;
(vi) the failure of any mechanical systems to function properly (such as the
HVAC systems); (vii) the blockage of access to any portion of the Property, the
Building or the Leased Premises, except that Tenant does not so release Landlord
from such liability to the extent such damage was proximately caused by
Landlord’s gross negligence, willful misconduct, or Landlord’s failure to
perform an obligation expressly required to be performed by Landlord pursuant to
this Lease after a reasonable period of time shall have lapsed following receipt
of written notice from Tenant to so perform such obligation.  In this regard,
Tenant acknowledges that it is fully apprised of the provisions of Law relating
to releases, and particularly to those provisions contained in Section 1542 of
the California Civil Code which reads as follows:

“A general release does not extend to claims which the creditor does not know or
suspect to exist in his favor at the time of executing the release, which if
known by him must have materially affected his settlement with the debtor.”

Notwithstanding such statutory provision, and for the purpose of implementing a
full and complete release and discharge, Tenant hereby (i) waives the benefit of
such statutory provision and (ii) acknowledges that, subject to the exceptions
specifically set forth herein, the release and discharge set forth in this
paragraph is a full and complete settlement and release and discharge of all
claims and is intended to include in its effect, without limitation, all claims
which Tenant, as of the date hereof, does not know of or suspect to exist in its
favor.

8.2  Tenant’s Indemnification Of Landlord.  Tenant shall defend with competent
counsel satisfactory to Landlord any claims made or legal actions filed or
threatened against the Landlord Indemnitees with respect to (a) the violation of
any Law by Tenant or its partners, principals, members, managers, officers,
agents, employees, lenders, attorneys, contractors, invitees, consultants,
predecessors, successors and assigns (collectively, the “Tenant Indemnitees”),
or the death, bodily injury, personal injury, property damage, or interference
with contractual or property rights suffered by any third party occurring within
the Leased Premises or resulting from Tenant’s or Tenant’s Indemnitees’ use or
occupancy of the Leased Premises, the Building or the Outside Areas, or
resulting from Tenant’s or Tenant’s Indemnitees’ activities in or about the
Leased Premises, the Building, the Outside Areas or the Property, and Tenant
shall indemnify and hold the Landlord Indemnitees harmless from any loss
liability, penalties, or expense whatsoever (including any loss attributable to
vacant space which otherwise would have been leased, but for such activities)
resulting therefrom, except to the extent proximately caused by the negligence
or willful misconduct of Landlord.  This indemnity agreement shall survive the
expiration or sooner termination of this Lease.

8.3  Landlord’s Indemnification Of Tenant.  Landlord shall indemnify and hold
Tenant harmless from any loss liability, penalties, or expense whatsoever
resulting from the gross negligence or willful misconduct of Landlord at or with
respect to the Property.  This indemnity agreement shall survive the expiration
or sooner termination of this Lease.

Article 9
INSURANCE

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9.1  Tenant’s Insurance.  Tenant shall maintain insurance complying with all of
the following:

(a)  Tenant shall procure, pay for and keep in full force and effect, at all
times during the Lease Term, the following:

(i)  Commercial general liability insurance insuring Tenant against liability
for personal injury, bodily injury, death and damage to property occurring
within the Leased Premises, or resulting from Tenant’s use or occupancy of the
Leased Premises, the Building, the Outside Areas or the Property, or resulting
from Tenant’s activities in or about the Leased Premises or the Property, with
coverage in an amount equal to Tenant’s Required Liability Coverage (as set
forth in Article 1), which insurance shall contain “blanket contractual
liability” and “broad form property damage” endorsements insuring Tenant’s
performance of Tenant’s obligations to indemnify Landlord as contained in this
Lease.

(ii)  Fire and property damage insurance in “special form” coverage insuring
Tenant against loss from physical damage to Tenant’s personal property,
inventory, trade fixtures and improvements within the Leased Premises with
coverage for the full actual replacement cost thereof;

(iii)  Business income/extra expense insurance sufficient to pay Base Monthly
Rent and Additional Rent for a period of not less than twelve (12) months;

(iv)  Plate glass insurance, at actual replacement cost;

(v)  Boiler and machinery insurance, to limits sufficient to restore the
Building;

(vi)  Product liability insurance (including, without limitation, if food and/or
beverages are distributed, sold and/or consumed within the Leased Premises, to
the extent obtainable, coverage for liability arising out of the distribution,
sale, use or consumption of food and/or beverages (including alcoholic
beverages, if applicable) at the Leased Premises for not less than Tenant’s
Required Liability Coverage (as set forth in Article 1);

(vii)  Workers’ compensation insurance (statutory coverage) with employer’s
liability in amounts not less than $1,000,000 insurance sufficient to comply
with all laws; and

(viii)  With respect to making of any alterations or modifications or the
construction of improvements or the like undertaken by Tenant, course of
construction, commercial general liability, automobile liability and workers’
compensation (to be carried by Tenant’s contractor), in an amount and with
coverage reasonably satisfactory to Landlord.

(b)  Each policy of liability insurance required to be carried by Tenant
pursuant to this paragraph or actually carried by Tenant with respect to the
Leased Premises or the Property: (i) shall, except with respect to insurance
required by subparagraphs (a)(ii) and (a)(viii) above, name Landlord, and such
others as are designated by Landlord, as additional insureds; (ii) shall, with
respect to insurance required by subparagraph (a)(ii) above, name Landlord, and
such others as are designated by Landlord, as loss payees; (iii) shall be
primary insurance providing that the insurer shall be liable for the full amount
of the loss, up to and including the total amount of liability set forth in the
declaration of coverage, without the right of contribution from or prior payment
by any other insurance coverage of Landlord; (iv) shall be in a form
satisfactory to Landlord; (v) shall be carried with companies reasonably
acceptable to Landlord with Best’s ratings of at least A and XI; (vi) shall
provide that such policy shall not be subject to cancellation, lapse or change
except after at least thirty (30) days prior written notice to Landlord, and
(vii) shall contain a so-called “severability” or “cross liability” endorsement.
 Each policy of property insurance maintained by Tenant with respect to the
Leased Premises or the Property or any property therein (i) shall provide that
such policy shall not be subject to cancellation, lapse or change except after
at least thirty (30) days prior written notice to Landlord and (ii) shall
contain a waiver and/or a permission to waive by the insurer of any right of
subrogation against Landlord, its partners, principals, members, managers,
officers,

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employees, agents and contractors, which might arise by reason of any payment
under such policy or by reason of any act or omission of Landlord, its partners,
principals, members, managers, officers, employees, agents and contractors.

(c)  Prior to the time Tenant or any of its contractors enters the Leased
Premises, Tenant shall deliver to Landlord, with respect to each policy of
insurance required to be carried by Tenant pursuant to this Article, a copy of
such policy (appropriately authenticated by the insurer as having been issued,
premium paid) or a certificate of the insurer certifying in form satisfactory to
Landlord that a policy has been issued, premium paid, providing the coverage
required by this Paragraph and containing the provisions specified herein.  With
respect to each renewal or replacement of any such insurance, the requirements
of this Paragraph must be complied with not less than thirty days prior to the
expiration or cancellation of the policies being renewed or replaced.  Landlord
may, at any time and from time to time, inspect and/or copy any and all
insurance policies required to be carried by Tenant pursuant to this Article.
 If Landlord’s Lender, insurance broker, advisor or counsel reasonably
determines at any time that the amount of coverage set forth in Paragraph 9.1(a)
for any policy of insurance Tenant is required to carry pursuant to this Article
is not adequate, then Tenant shall increase the amount of coverage for such
insurance to such greater amount as Landlord’s Lender, insurance broker, advisor
or counsel reasonably deems adequate.  In the event Tenant does not maintain
said insurance, Landlord may, in its sole discretion and without waiving any
other remedies hereunder, procure said insurance and Tenant shall pay to
Landlord as additional rent the cost of said insurance plus a ten percent
(10%) administrative fee.

9.2  Landlord’s Insurance.  With respect to insurance maintained by Landlord:

(a)  Landlord shall maintain, as the minimum coverage required of it by this
Lease, fire and property damage insurance in so-called special form coverage
insuring Landlord (and such others as Landlord may designate) against loss from
physical damage to the Building with coverage of not less than one hundred
percent (100%) of the full actual replacement cost thereof and against loss of
rents for a period of not less than six months.  Such fire and property damage
insurance, at Landlord’s election but without any requirements on Landlord’s
behalf to do so, (i) may be written in so-called “all risk” form, excluding only
those perils commonly excluded from such coverage by Landlord’s then property
damage insurer; (ii) may provide coverage for physical damage to the
improvements so insured for up to the entire full actual replacement cost
thereof; (iii) may be endorsed to cover loss or damage caused by any additional
perils against which Landlord may elect to insure, including earthquake and/or
flood; and/or (iv) may provide coverage for loss of rents for a period of up to
twelve months.  Landlord shall not be required to cause such insurance to cover
any of Tenant’s personal property, inventory, and trade fixtures, or any
modifications, alterations or improvements made or constructed by Tenant to or
within the Leased Premises.  Landlord shall use commercially reasonable efforts
to obtain such insurance at competitive rates.

(b)  Landlord shall maintain commercial general liability insurance insuring
Landlord (and such others as are designated by Landlord) against liability for
personal injury, bodily injury, death, and damage to property occurring in, on
or about, or resulting from the use or occupancy of the Property, or any portion
thereof, with combined single limit coverage of at least Ten Million Dollars
($10,000,000).  Landlord may carry such greater coverage as Landlord or
Landlord’s Lender, insurance broker, advisor or counsel may from time to time
determine is reasonably necessary for the adequate protection of Landlord and
the Property.

(c)  Landlord may maintain any other insurance which in the opinion of its
insurance broker, advisor or legal counsel is prudent to carry under the given
circumstances, provided such insurance is commonly carried by owners of property
similarly situated and operating under similar circumstances.

9.3  Mutual Waiver Of Subrogation.  Landlord hereby releases Tenant, and Tenant
hereby releases Landlord and its respective partners, principals, members,
officers, agents, employees and servants, from any and all liability for loss,
damage or injury to the property of the other in or about the Leased Premises or
the Property which is caused by or results from a peril or event or happening
which is covered by insurance actually carried and in force at the time of the
loss by the party sustaining such loss; provided, however, that such waiver
shall be

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effective only to the extent permitted by the insurance covering such loss and
to the extent such insurance is not prejudiced thereby.

Article 10
DAMAGE TO LEASED PREMISES

10.1  Landlord’s Duty To Restore.  If the Leased Premises, the Building or the
Outside Area are damaged by any peril after the Effective Date of this Lease,
Landlord shall restore the same, as and when required by this paragraph, unless
this Lease is terminated by Landlord pursuant to Paragraph 10.3 or by Tenant
pursuant to Paragraph 10.4.  If this Lease is not so terminated, then upon the
issuance of all necessary governmental permits, Landlord shall commence and
diligently prosecute to completion the restoration of the Leased Premises, the
Building or the Outside Area, as the case may be, to the extent then allowed by
law, to substantially the same condition in which it existed as of the Lease
Commencement Date.  Landlord’s obligation to restore shall be limited to the
improvements constructed by Landlord.  Landlord shall have no obligation to
restore any alterations, modifications or improvements made by Tenant to the
Leased Premises or any of Tenant’s personal property, inventory or trade
fixtures.  Upon completion of the restoration by Landlord, Tenant shall
forthwith replace or fully repair all of Tenant’s personal property, inventory,
trade fixtures and other improvements constructed by Tenant to like or similar
conditions as existed at the time immediately prior to such damage or
destruction.

10.2  Insurance Proceeds.  All insurance proceeds available from the fire and
property damage insurance carried by Landlord shall be paid to and become the
property of Landlord.  if this Lease is terminated pursuant to either
Paragraph 10.3 or 10.4, all insurance proceeds available from insurance carried
by Tenant which cover loss of property that is Landlord’s property or would
become Landlord’s property on termination of this Lease shall be paid to and
become the property of Landlord, and the remainder of such proceeds shall be
paid to and become the property of Tenant.  If this Lease is not terminated
pursuant to either Paragraph 10.3 or 10.4, all insurance proceeds available from
insurance carried by Tenant which cover loss to property that is Landlord’s
property shall be paid to and become the property of Landlord, and all proceeds
available from such insurance which cover loss to property which would only
become the property of Landlord upon the termination of this Lease shall be paid
to and remain the property of Tenant.  The determination of Landlord’s property
and Tenant’s property shall be made pursuant to Paragraph 6.2.

10.3  Landlord’s Right To Terminate.  Landlord shall have the option to
terminate this Lease in the event any of the following occurs, which option may
be exercised only by delivery to Tenant of a written notice of election to
terminate within thirty days after the date of such damage or destruction:

(a)  The Building is damaged by any peril covered by valid and collectible
insurance actually carried by Landlord and in force at the time of such damage
or destruction (an “insured peril”) to such an extent that the estimated cost to
restore the Building exceeds the lesser of (i) the insurance proceeds available
from insurance actually carried by Landlord, or (ii) fifty percent of the then
actual replacement cost thereof;

(b)  The Building is damaged by an uninsured peril, which peril Landlord was not
required to insure against pursuant to the provisions of Article 9 of this
Lease.

(c)  The Building is damaged by any peril and, because of the Laws or
Restrictions then in force, the Building (i) cannot be restored at reasonable
cost or (ii) if restored, cannot be used for the same use being made thereof
before such damage.

10.4  Tenant’s Right To Terminate.  If the Leased Premises, the Building or the
Outside Area are damaged by any peril and Landlord does not elect to terminate
this Lease or is not entitled to terminate this Lease pursuant to this Article,
then as soon as reasonably practicable, Landlord shall furnish Tenant with the
written opinion of Landlord’s architect or construction consultant as to when
the restoration work required of Landlord may be complete.  Tenant shall have
the option to terminate this Lease (if Tenant is not then in default) in the
event any of the following occurs, which option may be exercised only by
delivery to Landlord of a written notice

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of election to terminate within seven days after Tenant receives from Landlord
the estimate of the time needed to complete such restoration:

(a)  If the time estimated to substantially complete the restoration exceeds six
(6) months from and after the commencement of construction; or

(b)  If the damage occurred within twelve months of the last day of the Lease
Term and the time estimated to substantially complete the restoration exceeds
ninety (90) days from and after the date such restoration is commenced.

10.5  Tenant’s Waiver.  Landlord and Tenant agree that the provisions of
Paragraph 10.4 above, captioned “Tenant’s Right To Terminate”, are intended to
supersede and replace the provisions contained in California Civil Code,
Section 1932, Subdivision 2, and California Civil Code, Section 1933, and
accordingly, Tenant hereby waives the provisions of such Civil Code Sections and
the provisions of any successor Civil Code Sections or similar laws hereinafter
enacted.

10.6  Abatement Of Rent.  In the event of damage to the Leased Premises which
does not result in the termination of this Lease, then effective upon and after
the expiration of the period insured by any applicable rental or business
interruption insurance (the “Insured Period”), the Base Monthly Rent (and any
Additional Rent) shall be temporarily abated during the period (after the
Insured Period) of Landlord’s and/or Tenant’s (as applicable) restoration, in
proportion in the degree to which Tenant’s use of the Leased Premises (during
the restoration period but after the Insured Period) is impaired by such damage.

Article 11
CONDEMNATION

11.1  Tenant’s Right To Terminate.  Except as otherwise provided in
Paragraph 11.4 below regarding temporary takings, Tenant shall have the option
to terminate this Lease if, as a result of any taking, (i) all of the Leased
Premises is taken, or (ii) twenty-five percent (25%) or more of the Leased
Premises is taken and the part of the Leased Premises that remains cannot,
within a reasonable period of time, be made reasonably suitable for the
continued operation of Tenant’s business.  Tenant must exercise such option
within a reasonable period of time, to be effective on the later to occur of
(i) the date that possession of that portion of the Leased Premises that is
condemned is taken by the condemnor or (ii) the date Tenant vacated the Leased
Premises.

11.2  Landlord’s Right To Terminate.  Except as otherwise provided in
Paragraph 11.4 below regarding temporary takings, Landlord shall have the option
to terminate this Lease if, as a result of any taking, (i) all of the Leased
Premises is taken, (ii) twenty-five percent (25%) or more of the Leased Premises
is taken and the part of the Leased Premises that remains cannot, within a
reasonable period of time, be made reasonably suitable for the continued
operation of Tenant’s business, or (iii) because of the Laws or Restrictions
then in force, the Leased Premises may not be used for the same use being made
before such taking, whether or not restored as required by Paragraph 11.3 below.
 Any such option to terminate by Landlord must be exercised within a reasonable
period of time, to be effective as of the date possession is taken by the
condemnor.

11.3  Restoration.  If any part of the Leased Premises or the Building is taken
and this Lease is not terminated, then Landlord shall, to the extent not
prohibited by Laws or Restrictions then in force, repair any damage occasioned
thereby to the remainder thereof to a condition reasonably suitable for Tenant’s
continued operations and otherwise, to the extent practicable, in the manner and
to the extent provided in Paragraph 10.1.

11.4  Temporary Taking.  If a material portion of the Leased Premises is
temporarily taken for a period of one year or less and such period does not
extend beyond the Lease Expiration Date, this Lease shall remain in effect.  If
any material portion of the Leased Premises is temporarily taken for a period
which exceeds one year or which extends beyond the Lease Expiration Date, then
the rights of Landlord and Tenant shall be determined in accordance with
Paragraphs 11.1 and 11.2 above.

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11.5  Division Of Condemnation Award.  Any award made for any taking of the
Property, the Building, or the Leased Premises, or any portion thereof, shall
belong to and be paid to Landlord, and Tenant hereby assigns to Landlord all of
its right, title and interest in any such award; provided, however, that Tenant
shall be entitled to receive any portion of the award that is made specifically
(i) for the taking of personal property, inventory or trade fixtures belonging
to Tenant, (ii) for the interruption of Tenant’s business or its moving costs,
or (iii) for the value of any leasehold improvements installed and paid for by
Tenant.  The rights of Landlord and Tenant regarding any condemnation shall be
determined as provided in this Article, and each party hereby waives the
provisions of Section 1265.130 of the California Code of Civil Procedure, and
the provisions of any similar law hereinafter enacted, allowing either party to
petition the Supreme Court to terminate this Lease and/or otherwise allocate
condemnation awards between Landlord and Tenant in the event of a taking of the
Leased Premises.

11.6  Abatement Of Rent.  In the event of a taking of the Leased Premises which
does not result in a termination of this Lease (other than a temporary taking),
then, as of the date possession is taken by the condemning authority, the Base
Monthly Rent shall be reduced in the same proportion that the area of that part
of the Leased Premises so taken (less any addition to the area of the Leased
Premises by reason of any reconstruction) bears to the area of the Leased
Premises immediately prior to such taking.

11.7  Taking Defined.  The term “taking” or “taken” as used in this Article 11
shall mean any transfer or conveyance of all or any portion of the Property to a
public or quasi-public agency or other entity having the power of eminent domain
pursuant to or as a result of the exercise of such power by such an agency,
including any inverse condemnation and/or any sale or transfer by Landlord of
all or any portion of the Property to such an agency under threat of
condemnation or the exercise of such power.

Article 12
DEFAULT AND REMEDIES

12.1  Events Of Tenant’s Default.  An event of default by Tenant (an “Event of
Default”) shall exist if any of the following events occurs:

(a)  Tenant shall have failed to pay Base Monthly Rent or any Additional Rent
when due; provided that Tenant shall be entitled to receive written notice of
late payment one time during each year of the Lease Term, and with respect to
that one late payment, Tenant shall not be in default under this
Paragraph 12.1(a) unless Tenant has failed to make the required payment within
three (3) business days after such notice from Landlord.  After the notice has
been given, Landlord shall not be required to provide any further notices to
Tenant.  Each such notice shall be concurrent with, and not in addition to, any
notice required by applicable Laws; or

(b)  Tenant shall have failed to perform any term, covenant, or condition of
this Lease (except those requiring the Payment of Base Monthly Rent or
Additional Rent, which failures shall be governed by subparagraph (a) above) and
such default is not cured within thirty (30) days after written notice from
Landlord to Tenant specifying the nature of such default and requesting Tenant
to cure the same, or within such longer period as is reasonably required in the
event such default is curable but not within such thirty (30) day period,
provided such cure is promptly commenced within such thirty (30) day period and
is thereafter diligently prosecuted to completion; or

(c)  (i) Tenant shall have sublet the Leased Premises or assigned or encumbered
its interest in this Lease in violation of the provisions contained in
Article 7, or (ii) any guarantor shall have assigned or delegated its rights or
obligations under the applicable guaranty without first obtaining Landlord’s
written consent if and as required by the terms of the applicable guaranty, in
either case (i) or (ii), whether voluntarily or by operation of law; or

(d)  Tenant shall have abandoned the Leased Premises; or

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(e)  Tenant or any guarantor of this Lease shall have permitted or suffered the
sequestration or attachment of, or execution on, or the appointment of a
custodian or receiver with respect to, all or any substantial part of the
property or assets of Tenant (or such guarantor) or any property or asset
essential to the conduct of Tenant’s (or such guarantor’s) business, and Tenant
(or such guarantor) shall have failed to obtain a return or release of the same
within thirty days thereafter, or prior to sale pursuant to such sequestration,
attachment or levy, whichever is earlier; or

(f)  Tenant or any guarantor of this Lease shall have made a general assignment
of all or a substantial part of its assets for the benefit of its creditors; or

(g)  Tenant or any guarantor of this Lease shall have allowed (or sought) to
have entered against it a decree or order which: (i) grants or constitutes an
order for relief, appointment of a trustee, or condemnation or a reorganization
plan under the bankruptcy laws of the United States; (ii) approves as properly
filed a petition seeking liquidation or reorganization under said bankruptcy
laws or any other debtor’s relief law or similar statute of the United States or
any state thereof; or (iii) otherwise directs the winding up or liquidation of
Tenant; provided, however, if any decree or order was entered without Tenant’s
consent or over Tenant’s objection, Landlord may not terminate this Lease
pursuant to this Subparagraph if such decree or order is rescinded or reversed
within thirty days after its original entry; or

(h)  Tenant or any guarantor of this Lease shall have availed itself of the
protection of any debtor’s relief law, moratorium law or other similar law which
does not require the prior entry of a decree or order.

12.2  Landlord’s Remedies.  In the event of any default by Tenant, and without
limiting Landlord’s right to indemnification as provided in Article 8.2,
Landlord shall have the following remedies, in addition to all other rights and
remedies provided by law or otherwise provided in this Lease, to which Landlord
may resort cumulatively, or in the alternative:

(a)  Landlord may, at Landlord’s election, keep this Lease in effect and
enforce, by an action at law or in equity, all of its rights and remedies under
this Lease including, without limitation, (i) the right to recover the rent and
other sums as they become due by appropriate legal action, (ii) the right to
make payments required by Tenant, or perform Tenant’s obligations and be
reimbursed by Tenant for the cost thereof with interest at the then maximum rate
of interest not prohibited by law from the date the sum is paid by Landlord
until Landlord is reimbursed by Tenant, and (iii) the remedies of injunctive
relief and specific performance to prevent Tenant from violating the terms of
this Lease and/or to compel Tenant to perform its obligations under this Lease,
as the case may be.

(b)  Landlord may, at Landlord’s election, terminate this Lease by giving Tenant
written notice of termination, in which event this Lease shall terminate on the
date set forth for termination in such notice, in which event Tenant shall
immediately surrender the Leased Premises to Landlord, and if Tenant fails to do
so, Landlord may, without prejudice to any other remedy which it may have for
possession or arrearages in rent, enter upon and take possession of the Leased
Premises and expel or remove Tenant and any other person who may be occupying
the Leased Premises or any part thereof, without being liable for prosecution or
any claim for damages therefor.  Any termination under this subparagraph shall
not relieve Tenant from its obligation to pay to Landlord all Base Monthly Rent
and Additional Rent then or thereafter due, or any other sums due or thereafter
accruing to Landlord, or from any claim against Tenant for damages previously
accrued or then or thereafter accruing.  In no event shall any one or more of
the following actions by Landlord, in the absence of a written election by
Landlord to terminate this Lease constitute a termination of this Lease:

(i)  Appointment of a receiver or keeper in order to protect Landlord’s interest
hereunder;

(ii)  Consent to any subletting of the Leased Premises or assignment of this
Lease by Tenant, whether pursuant to the provisions hereof or otherwise; or

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(iii)  Any action taken by Landlord or its partners, principals, members,
officers, agents, employees, or servants, which is intended to mitigate the
adverse effects of any breach of this Lease by Tenant, including, without
limitation, any action taken to maintain and preserve the Leased Premises on any
action taken to relet the Leased Premises or any portion thereof for the account
at Tenant and in the name of Tenant.

(c)  In the event Tenant breaches this Lease and abandons the Leased Premises,
Landlord may terminate this Lease, but this Lease shall not terminate unless
Landlord gives Tenant written notice of termination.  If Landlord does not
terminate this Lease by giving written notice of termination, Landlord may
enforce all its rights and remedies under this Lease, including the right and
remedies provided by California Civil Code Section 1951.4 (“lessor may continue
lease in effect after lessee’s breach and abandonment and recover rent as it
becomes due, if lessee has right to sublet or assign, subject only to reasonable
limitations”), as in effect on the Effective Date of this Lease.

(d)  In the event Landlord terminates this Lease, Landlord shall be entitled, at
Landlord’s election, to the rights and remedies provided in California Civil
Code Section 1951.2, as in effect on the Effective Date of this Lease.  For
purposes of computing damages pursuant to Section 1951.2, an interest rate equal
to the maximum rate of interest then not prohibited by law shall be used where
permitted.  Such damages shall include, without limitation:

(i)  The worth at the time of the award of the unpaid rent which had been earned
at the time of termination; plus

(ii)  The worth at the time of award of the amount by which the unpaid rent
which would have been earned after termination until the time of award exceeds
the amount of such rental loss that Tenant proves could have been reasonably
avoided; plus

(iii)  The worth at the time of award of the amount by which the unpaid rent for
the balance of the term after the time of award exceeds the amount of such
rental loss that Tenant proves could be reasonably avoided, computed by
discounting such amount at the discount rate of the Federal Reserve Bank of San
Francisco, at the time of award plus one percent; plus

(iv)  Any other amount necessary to compensate Landlord for all detriment
proximately caused by Tenant’s failure to perform Tenant’s obligations under
this Lease, or which in the ordinary course of things would be likely to result
therefrom, including without limitation, the following: (i) expenses for
cleaning, repairing or restoring the Leased Premises, (ii) expenses for
altering, remodeling or otherwise improving the Leased Premises for the purpose
of reletting, including removal of existing leasehold improvements and/or
installation of additional leasehold improvements (regardless of how the same is
funded, including reduction of rent, a direct payment or allowance to a new
tenant, or otherwise), (iii) broker’s fees allocable to the remainder of the
term of this Lease, advertising costs and other expenses of reletting the Leased
Premises; (iv) costs of carrying and maintaining the Leased Premises, such as
taxes, insurance premiums, utility charges and security precautions (although
the foregoing shall not in any way modify Paragraph 5.3 above), (v) expenses
incurred in removing, disposing of and/or storing any of Tenant’s personal
property, inventory or trade fixtures remaining therein; (vi) reasonable
attorney’s fees, expert witness fees, court costs and other reasonable expenses
incurred by Landlord (but not limited to taxable costs) in retaking possession
of the Leased Premises, establishing damages hereunder, and releasing the Leased
Premises; and (vii) any other expenses, costs or damages otherwise incurred or
suffered as a result of Tenant’s default; plus

(e)  The unamortized amount of any tenant improvement or similar allowance paid
or credited by Landlord to Tenant pursuant to this Lease or the Work Letter.

(f)  In addition, Tenant acknowledges that an event of default under this Lease
may cause Landlord to incur damages under its mortgage and related financing
documents, including, but not limited to, the payment of default interest, legal
fees, late charges, collection costs, and sums necessary to maintain Lender’s

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yield on the loaned amounts.  Accordingly, Tenant agrees that Landlord has the
right to add such loan-related damages to the damages for which Tenant is
responsible hereunder as a result of an event of default.

(g)  Pursuant to California Code of Civil Procedure Section 1161.1, Landlord may
accept a partial payment of Rent after serving a notice pursuant to California
Code of Civil Procedure Section 1161, and may without further notice to the
Tenant, commence and pursue an action to recover the difference between the
amount demanded in that notice and the payment actually received.  This
acceptance of such a partial payment of Rent does not constitute a waiver of any
rights, including any right the Landlord may have to recover possession of the
Leased Premises.  Further, Tenant agrees that any notice given by Landlord
pursuant to Paragraph 12.1 of the Lease shall satisfy the requirements for
notice under California Code of Civil Procedure Section 1161, and Landlord shall
not be required to give any additional notice in order to be entitled to
commence an unlawful detainer proceeding.

12.3  Landlord’s Default And Tenant’s Remedies.  In the event Landlord fails to
perform its obligations under this Lease, Landlord shall nevertheless not be in
default under the terms of this Lease until such time as Tenant shall have first
given Landlord written notice specifying the nature of such failure to perform
its obligations, and then only after Landlord shall have had thirty (30) days
following its receipt of such notice within which to perform such obligations;
provided that, if longer than thirty (30) days is reasonably required in order
to perform such obligations, Landlord shall have such longer period.  In the
event of Landlord’s default as above set forth, then, and only then, Tenant may
then proceed in equity or at law to compel Landlord to perform its obligations
and/or to recover damages proximately caused by such failure to perform (except
as and to the extent Tenant has waived its right to damages as provided in this
Lease).

12.4  Limitation Of Tenant’s Recourse.  Tenant’s sole recourse against Landlord
shall be to Landlord’s interest in the Building and the Outside Areas.  If
Landlord is a corporation, trust, partnership, joint venture, limited liability
company, unincorporated association, or other form of business entity, Tenant
agrees that (i) the obligations of Landlord under this Lease shall not
constitute personal obligations of the officers, directors, trustees, partners,
joint venturers, members, managers, owners, stockholders, or other principals of
such business entity, and (ii) Tenant shall have recourse only to the interest
of such corporation, trust, partnership, joint venture, limited liability
company, unincorporated association, or other form of business entity in the
Building and the Outside Areas for the satisfaction of such obligations and not
against the assets of such officers, directors, trustees, partners, joint
venturers, members, managers, owners, stockholders or principals.  Additionally,
if Landlord is a partnership or limited liability company, then Tenant covenants
and agrees:

(a)  No partner, manager, or member of Landlord shall be sued or named as a
party in any suit or action brought by Tenant with respect to any alleged breach
of this Lease (except to the extent necessary to secure jurisdiction over the
partnership or limited liability company and then only for that sole purpose);

(b)  No service of process shall be made against any partner, manager, or member
of Landlord except for the sole purpose of securing jurisdiction over the
partnership; and

(c)  No writ of execution will ever be levied against the assets of any partner,
manager, or member of Landlord other than to the extent of his or her interest
in the assets of the partnership or limited liability company constituting
Landlord.

Tenant further agrees that each of the foregoing covenants and agreements shall
be enforceable by Landlord and by any partner or manager or member of Landlord
and shall be applicable to any actual or alleged misrepresentation or
nondisclosure made regarding this Lease or the Leased Premises or any actual or
alleged failure, default or breach of any covenant or agreement either expressly
or implicitly contained in this Lease or imposed by statute or at common law.

12.5  Tenant’s Waiver.  Landlord and Tenant agree that the provisions of
Paragraph 12.3 above are intended to supersede and replace the provisions of
California Civil Code Sections 1932(1), 1941 and 1942, and

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accordingly, Tenant hereby waives the provisions of California Civil Code
Sections 1932(1), 1941 and 1942 and/or any similar or successor law regarding
Tenant’s right to terminate this Lease or to make repairs and deduct the
expenses of such repairs from the rent due under this Lease.

Article 13
GENERAL PROVISIONS

13.1  Taxes On Tenant’s Property.  Tenant shall pay before delinquency any and
all taxes, assessments, license fees, use fees, permit fees and public charges
of whatever nature or description levied, assessed or imposed against Tenant or
Landlord by a governmental agency arising out of, caused by reason of or based
upon Tenant’s estate in this Lease, Tenant’s ownership of property, improvements
made by Tenant to the Leased Premises or the Outside Areas, improvements made by
Landlord for Tenant’s use within the Leased Premises or the Outside Areas,
Tenant’s use (or estimated use) of public facilities or services or Tenant’s
consumption (or estimated consumption) of public utilities, energy, water or
other resources (collectively, “Tenant’s Interest”).  Upon demand by Landlord,
Tenant shall furnish Landlord with satisfactory evidence of these payments.  If
any such taxes, assessments, fees or public charges are levied against Landlord,
Landlord’s property, the Building or the Property, or if the assessed value of
the Building or the Property is increased by the inclusion therein of a value
placed upon Tenant’s Interest, regardless of the validity thereof, Landlord
shall have the right to require Tenant to pay such taxes, and if not paid and
satisfactory evidence of payment delivered to Landlord at least ten days prior
to delinquency, then Landlord shall have the right to pay such taxes on Tenant’s
behalf and to invoice Tenant for the same, in either case whether before or
after the expiration or earlier termination of the Lease Term.  Tenant shall,
within the earlier to occur of (a) thirty (30) days of the date it receives an
invoice from Landlord setting forth the amount of such taxes, assessments, fees,
or public charge so levied, or (b) the due date of such invoice, pay to
Landlord, as Additional Rent, the amount set forth in such invoice.  Failure by
Tenant to pay the amount so invoiced within such time period shall be
conclusively deemed a default by Tenant under this Lease.  Tenant shall have the
right to bring suit in any court of competent jurisdiction to recover from the
taxing authority the amount of any such taxes, assessments, fees or public
charges so paid.

13.2  Holding Over.  This Lease shall terminate without further notice on the
Lease Expiration Date (as set forth in Article 1).  Any holding over by Tenant
after expiration of the Lease Term shall neither constitute a renewal nor
extension of this Lease nor give Tenant any rights in or to the Leased Premises
except as expressly provided in this Paragraph.  Any such holding over to which
Landlord has consented shall be construed to be a tenancy from month to month,
on the same terms and conditions herein specified insofar as applicable, except
that the Base Monthly Rent shall be increased to an amount equal to one hundred
fifty percent (150%) of the Base Monthly Rent payable during the last full month
immediately preceding such holding over.  Without limiting the foregoing, in the
event of a holding over to which Landlord has consented, any rights of Landlord
or obligations of Tenant set forth in this Lease and purporting to apply during
the term of this Lease, shall nonetheless also be deemed to apply during any
such hold over period.  Tenant acknowledges that if Tenant holds over without
Landlord’s consent, such holding over may compromise or otherwise affect
Landlord’s ability to enter into new leases with prospective tenants regarding
the Leased Premises.  Therefore, if Tenant fails to surrender the Leased
Premises upon the expiration or termination of this Lease, in addition to any
other liabilities to Landlord accruing therefrom, Tenant shall protect, defend,
indemnify and hold Landlord harmless from and against all claims resulting from
such failure, including, without limiting the foregoing, any claims made by any
succeeding tenant founded upon such failure to surrender, and any losses
suffered by Landlord, including lost profits, resulting from such failure to
surrender.

13.3  Subordination To Mortgages.  On or before the Effective Date of this
Lease, Landlord shall obtain a subordination and non-disturbance agreement from
each existing beneficiary of a deed of trust in the form attached to this Lease
as Exhibit C.  This Lease is subject to and subordinate to all ground leases,
mortgages and deeds of trust which affect the Building or the Property and which
are of public record as of the Effective Date of this Lease, and to all
renewals, modifications, consolidations, replacements and extensions thereof.
 Notwithstanding the foregoing, if requested by Landlord, Tenant agrees, within
ten days after Landlord’s written

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request therefor, to execute, acknowledge and deliver to Landlord any and all
documents or instruments requested by Landlord or by the existing lessor or
lender to assure the subordination of this Lease to such ground lease, mortgage
or deed of trust, including but not limited to a subordination agreement in the
form attached to this Lease as Exhibit C or such other form as any such lessor
or lender may require.  However, if the lessor under any such ground lease or
any lender holding any such mortgage or deed of trust shall advise Landlord that
it desires or requires this Lease to be made prior and superior thereto, then,
upon written request of Landlord to Tenant, Tenant shall promptly execute,
acknowledge and deliver any and all customary or reasonable documents or
instruments which Landlord and such lessor or lender deems necessary or
desirable to make this Lease prior thereto.  Tenant hereby consents to
Landlord’s ground leasing the land underlying the Building or the Property
and/or encumbering the Building or the Property as security for future loans on
such terms as Landlord shall desire, all of which future ground leases,
mortgages or deeds of trust shall be subject to and subordinate to this Lease.
 However, if any lessor under any such future ground lease or any lender holding
such future mortgage or deed of trust shall desire or require that this Lease be
made subject to and subordinate to such future ground lease, mortgage or deed of
trust, then Tenant agrees, within ten days after Landlord’s written request
therefor, to execute, acknowledge and deliver to Landlord any and all documents
or instruments requested by Landlord or by such lessor or lender to assure the
subordination of this Lease to such future ground lease, mortgage or deed of
trust, but only if such lessor or lender agrees not to disturb Tenant’s quiet
possession of the Leased Premises so long as no Event of Default then exists
under this Lease.  Tenant’s failure to execute and deliver such documents or
instruments within ten business days after Landlord’s request therefor shall be
a material default by Tenant under this Lease, and no further notice shall be
required under Paragraph 12.1(c) or any other provision of this Lease, and
Landlord shall have all of the rights and remedies available to Landlord as
Landlord would otherwise have in the case of any other material default by
Tenant, it being agreed and understood by Tenant that Tenant’s failure to so
deliver such documents or instruments in a timely manner could result in
Landlord being unable to perform committed obligations to other third parties
which were made by Landlord in reliance upon this covenant of Tenant.  If
Landlord assigns the Lease as security for a loan, Tenant agrees to execute such
documents as are reasonably requested by the lender and to provide reasonable
provisions in the Lease protecting such lender’s security interest which are
customarily required by institutional lenders making loans secured by a deed of
trust.

13.4  Tenant’s Attornment Upon Foreclosure.  Tenant shall, upon request, attorn
(i) to any purchaser of the Building or the Property at any foreclosure sale or
private sale conducted pursuant to any security instruments encumbering the
Building or the Property, (ii) to any grantee or transferee designated in any
deed given in lieu of foreclosure of any security interest encumbering the
Building or the Property, or (iii) to the lessor under an underlying ground
lease of the land underlying the Building or the Property, should such ground
lease be terminated; provided that such purchaser, grantee or lessor recognizes
Tenant’s rights under this Lease.

13.5  Mortgagee Protection.  In the event of any default on the part of
Landlord, Tenant will give notice by registered mail to any Lender or lessor
under any underlying ground lease who shall have requested, in writing, to
Tenant that it be provided with such notice, and Tenant shall offer such Lender
or lessor a reasonable opportunity to cure the default, including time to obtain
possession of the Leased Premises by power of sale or judicial foreclosure or
other appropriate legal proceedings if reasonably necessary to effect a cure.

13.6  Estoppel Certificate.  Tenant will, following any request by Landlord,
promptly execute and deliver to Landlord an estoppel certificate substantially
in form attached as Exhibit D, (i) certifying that this Lease is unmodified and
in full force and effect, or, if modified, stating the nature of such
modification and certifying that this Lease, as so modified, is in full force
and effect, (ii) stating the date to which the rent and other charges are paid
in advance, if any, (iii) acknowledging that there are not, to Tenant’s
knowledge, any uncured defaults on the part of Landlord hereunder, or specifying
such defaults if any are claimed, and (iv) certifying such other information
about this Lease as may be reasonably requested by Landlord, its Lender or
prospective lenders, investors or purchasers of the Building or the Property.
 Tenant’s failure to execute and deliver such estoppel certificate within ten
business days after Landlord’s request therefor shall be a material default by
Tenant under this Lease, and no further notice shall be required under
Paragraph 12.1(c) or any other provision of this Lease, and Landlord shall have
all of the rights and remedies available to Landlord as Landlord would otherwise
have in

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the case of any other material default by Tenant, it being agreed and understood
by Tenant that Tenant’s failure to so deliver such estoppel certificate in a
timely manner could result in Landlord being unable to perform committed
obligations to other third parties which were made by Landlord in reliance upon
this covenant of Tenant.  Landlord and Tenant intend that any statement
delivered pursuant to this paragraph may be relied upon by any Lender or
purchaser or prospective Lender or purchaser of the Building, the Property, or
any interest in them.

13.7  Tenant’s Financial Information.  Tenant shall, within ten business days
after Landlord’s request therefor, deliver to Landlord a copy of Tenant’s (and
any guarantor’s) current financial statements (including a balance sheet, income
statement and statement of cash flow, all prepared in accordance with generally
accepted accounting principles), a list of all of Tenant’s creditors with
current contact information, and any such other information reasonably requested
by Landlord regarding Tenant’s financial condition; provided, however, that as
long as the common stock of Tenant (or its assigns permitted pursuant to this
Lease or otherwise approved by Landlord in writing) is publicly-traded on a
United States national stock exchange, and such information is available as part
of Tenant’s or such Permitted Transferee’s 10-K or 10-Q report filings on the
SEC’s Edgar website, and such materials are current per SEC filing requirements,
then such requirement shall be fulfilled by such filings.  Landlord shall be
entitled to disclose such financial statements or other information to its
Lender, to any present or prospective principal of or investor in Landlord, or
to any prospective Lender or purchaser of the Building, the Property, or any
portion thereof or interest therein.  Any such financial statement or other
information which is marked “confidential” or “company secrets” (or is otherwise
similarly marked by Tenant) shall be confidential and shall not be disclosed by
Landlord to any third party except as specifically provided in this paragraph,
unless the same becomes a part of the public domain without the fault of
Landlord.

13.8  Transfer By Landlord.  Landlord and its successors in interest shall have
the right to transfer their interest in the Building, the Property, or any
portion thereof at any time and to any person or entity.  In the event of any
such transfer, the Landlord originally named herein (and in the case of any
subsequent transfer, the transferor), from the date of such transfer, shall be
automatically relieved, without any further act by any person or entity, of all
liability for (i) the performance of the obligations of the Landlord hereunder
which may accrue after the date of such transfer, and (ii) repayment of any
unapplied portion of the Security Deposit (upon transferring or crediting the
same to the transferee), and (iii) the performance of the obligations of the
Landlord hereunder which have accrued before the date of transfer if its
transferee agrees to assume and perform all such prior obligations of the
Landlord hereunder.  Tenant shall attorn to any such transferee.  After the date
of any such transfer, the term “Landlord” as used herein shall mean the
transferee of such interest in the Building or the Property.

13.9  Force Majeure.  Any prevention, delay or stoppage due to strikes,
lockouts, labor disputes, acts of God, acts of war, terrorist acts, inability to
obtain services, labor, or materials or reasonable substitutes therefor,
governmental actions, civil commotions, fire or other casualty, and other causes
beyond the reasonable control of the party obligated to perform, except with
respect to the obligations imposed with regard to Rent and other charges to be
paid by Tenant pursuant to this Lease (collectively, a “Force Majeure”),
notwithstanding anything to the contrary contained in this Lease, shall excuse
the performance of such party for a period equal to any such prevention, delay
or stoppage and, therefore, if this Lease specifies a time period for
performance of an obligation of either party, that time period shall be extended
by the period of any delay in such party’s performance caused by a Force
Majeure.

13.10  Notices.  Any notice required or permitted to be given under this Lease
other than statutory notices shall be in writing and (i) personally delivered,
(ii) sent by United States mail, registered or certified mail, postage prepaid,
return receipt requested, (iii) sent by Federal Express or similar nationally
recognized overnight courier service, or (iv) transmitted by facsimile with a
hard copy sent within one (1) business day by any of the foregoing means, and in
all cases addressed as follows, and such notice shall be deemed to have been
given upon the date of actual receipt or delivery (or refusal to accept
delivery) at the address specified below (or such other addresses as may be
specified by notice in the foregoing manner) as indicated on the return receipt
or air bill:

   

 

If to Landlord:  

   

Santa Clara Office Partners LLC

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c/o Menlo Equities LLC

   

   

490 California Avenue

   

   

4th Floor

   

   

Palo Alto, California 94306

   

   

Attention: Henry Bullock/Richard Holmstrom

   

   

Facsimile: (650) 326-9333

   

   

   

with a copy to:

   

Goodwin|Procter LLP

   

   

Three Embarcadero Center

   

   

24th Floor

   

   

Attention: San Francisco, California 94111

   

   

Paul Churchill

   

   

Facsimile: (415) 677-9041

   

   

   

If to Tenant:

   

   

   

   

   

Prior to the Lease

   

   

Commencement

   

   

Date:

   

Palo Alto Networks, Inc.

   

   

232 E. Java Drive

   

   

Sunnyvale, California 94089

   

   

Attention: Michael Lehman

   

   

Facsimile: (408) 738-7779

After the Lease

   

   

Commencement

   

   

Date:

   

Palo Alto Networks, Inc.

   

   

3300 Olcott Street

   

   

Santa Clara, California 95054

   

   

Attention: Michael Lehman

   

   

Facsimile: [to be provided by Tenant prior to the Lease Commencement Date]

   

   

   

In each case with a copy to:

   

Fenwick & West LLP

   

   

801 California Street

   

   

Mountain View, California 94041

   

   

Attention: Blake Stafford

   

   

Facsimile: (650) 938-5200

Any notice given in accordance with the foregoing shall be deemed received upon
actual receipt or refusal to accept delivery.  Any notice required by statute
and not waived in this Lease shall be given and deemed received in accordance
with the applicable statute or as otherwise provided by law.

13.11  Attorneys’ Fees and Costs.  In the event any party shall bring any
action, arbitration, or other proceeding alleging a breach of any provision of
this Lease, or a right to recover rent, to terminate this Lease, or to enforce,
protect, interpret, determine, or establish any provision of this Lease or the
rights or duties hereunder of either party, the prevailing party shall be
entitled to recover from the non-prevailing party as a part of such action or
proceeding, or in a separate action for that purpose brought within one year
from the determination of such proceeding, reasonable attorneys’ fees, expert
witness fees, court costs and reasonable disbursements, made or incurred by the
prevailing party.

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13.12  Definitions.  Any term that is given a special meaning by any provision
in this Lease shall, unless otherwise specifically stated, have such meaning
wherever used in this Lease or in any Addenda or amendment hereto.  In addition
to the terms defined in Article 1, the following terms shall have the following
meanings:

(a)  Real Property Taxes.  The term “Real Property Tax” or “Real Property Taxes”
shall each mean Tenant’s Expense Share of the following (to the extent
applicable to any portion of the Lease Term, regardless of when the same are
imposed, assessed, levied, or otherwise charged): (i) all taxes, assessments,
levies and other charges of any kind or nature whatsoever, general and special,
foreseen and unforeseen (including all installments of principal and interest
required to pay any general or special assessments for public improvements and
any increases resulting from reassessments caused by any change in ownership or
new construction), now or hereafter imposed by any governmental or
quasi-governmental authority or special district having the direct or indirect
power to tax or levy assessments, which are levied or assessed for whatever
reason against the Property or any portion thereof, or Landlord’s interest
herein, or the fixtures, equipment and other property of Landlord that is an
integral part of the Property and located thereon, or Landlord’s business of
owning, leasing or managing the Property or the gross receipts, income or
rentals from the Property, (ii) all charges, levies or fees imposed by any
governmental authority against Landlord by reason of or based upon the use of or
number of parking spaces within the Property, the amount of public services or
public utilities used or consumed (e.g. water, gas, electricity, sewage or waste
water disposal) at the Property, the number of persons employed by tenants of
the Property, the size (whether measured in area, volume, number of tenants or
whatever) or the value of the Property, or the type of use or uses conducted
within the Property, and all costs and fees (including attorneys’ fees)
reasonably incurred by Landlord in contesting any Real Property Tax and in
negotiating with public authorities as to any Real Property Tax.  If, at any
time during the Lease Term, the taxation or assessment of the Property
prevailing as of the Effective Date of this Lease shall be altered so that in
lieu of or in addition to any the Real Property Tax described above there shall
be levied, awarded or imposed (whether by reason of a change in the method of
taxation or assessment, creation of a new tax or charge, or any other cause) an
alternate, substitute, or additional use or charge (i) on the value, size, use
or occupancy of the Property or Landlord’s interest therein or (ii) on or
measured by the gross receipts, income or rentals from the Property, or on
Landlord’s business of owning, leasing or managing the Property or
(iii) computed in any manner with respect to the operation of the Property, then
any such tax or charge, however designated, shall be included within the meaning
of the terms “Real Property Tax” or “Real Property Taxes” for purposes of this
Lease.  If any Real Property Tax is partly based upon property or rents
unrelated to the Property, then only that part of such Real Property Tax that is
fairly allocable to the Property shall be included within the meaning of the
terms “Real Property Tax” or “Real Property Taxes.” Notwithstanding the
foregoing, the terms “Real Property Tax” or “Real Property Taxes” shall not
include estate, inheritance, transfer, gift or franchise taxes of Landlord or
the federal or state income tax imposed on Landlord’s income from all sources.

(b)  Landlord’s Insurance Costs.  The term “Landlord’s Insurance Costs” shall
mean Tenant’s Expense Share of the following (to the extent applicable to any
portion of the Lease Term, regardless of when the same are incurred): the costs
to Landlord to carry and maintain the policies of fire and property damage
insurance for the Building and the Property and general liability and any other
insurance required or permitted to be carried by Landlord pursuant to Article 9,
together with any deductible amounts paid by Landlord upon the occurrence of any
insured casualty or loss.

(c)  Property Maintenance Costs.  The term “Property Maintenance Costs” shall
mean Tenant’s Expense Share of all costs and expenses (except Landlord’s
Insurance Costs and Real Property Taxes) paid or incurred by Landlord in
protecting, operating, maintaining, repairing and preserving the Property and
all parts thereof, including without limitation, (i) monthly professional
management fees equal to $3,720 per month for the first twelve (12) months of
the Lease Term, and thereafter three percent (3%) of Base Monthly Rent, (ii) the
amortizing portion of any costs incurred by Landlord in the making of any
modifications, alterations or improvements required by any governmental
authority as set forth in Article 6, which are so amortized during the Lease
Term, and (iii) such other costs as may be paid or incurred with respect to
operating, maintaining, and preserving the Property, such as repairing and
resurfacing the exterior surfaces of the Building (including roofs), repairing
and resurfacing paved areas, repairing and replacing structural parts of the
Building, and repairing and

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replacing, when necessary, electrical, plumbing, heating, ventilating and air
conditioning systems serving the Building.  To the extent any of the foregoing
items described in clause (iii) constitute capital repairs or replacements under
generally accepted accounting principles, consistently applied, have a useful
life of more than one year, and are not necessitated due to Tenant’s misuse of
or failure to maintain the Leased Premises as required by this Lease, then only
the amortizing portion of such capital repairs or replacements shall constitute
Property Maintenance Costs; such amortization shall be over the useful life of
the applicable repair or replacement, and shall employ an interest rate equal to
the greater of (a) 8% per annum, or (b) Wells Prime Plus Two (but in no event
more than the maximum rate of interest not prohibited or made usurious).

Notwithstanding the foregoing provisions of this Paragraph 13.12(c), the
following are specifically excluded from the definition of Property Maintenance
Costs and Tenant shall have no obligation to pay directly or reimburse Landlord
for all or any portion of the following except to the extent any of the
following are caused by the actions or inactions of Tenant, or result from the
failure of Tenant to comply with the terms of this Lease: (i) costs incurred
because Landlord actually violated the terms and conditions of this Lease or any
other lease for premises within the Building, if any; (ii) legal and auditing
fees (other than those fees reasonably incurred in connection with the
maintenance and operation of all or any portion the Building), leasing
commissions, advertising expenses, and other costs incurred in connection with
the original leasing of the Property or future re-leasing of any portion of the
Building; (iii) depreciation of the Building or any other improvements situated
within the Property; (iv) any items for which Landlord is actually reimbursed by
insurance or by direct reimbursement by Tenant or any other party; (v) costs of
repairs or other work necessitated by fire, windstorm or other casualty
(excluding any deductibles) and/or costs of repair or other work necessitated by
the exercise of the right of eminent domain to the extent insurance proceeds or
a condemnation award, as applicable, is actually received by Landlord for such
purposes; (vi) other than any interest charges for capital improvements referred
to in Paragraph 6.3 of this Lease, any interest or payments on any financing for
the Building, interest and penalties incurred as a result of Landlord’s late
payment of any invoice (provided that Tenant pays Tenant’s Expense Share of
Property Operating Expenses and Real Property Taxes to Landlord when due as set
forth herein), and any bad debt loss, rent loss or reserves for same;
(vii) overhead and profit increment paid to Landlord or to subsidiaries or
affiliates of Landlord for goods and/or services in the Property to the extent
the same exceeds the costs of such by unaffiliated third parties on a
competitive basis; or any costs included in Property Operating Expenses
representing an amount paid to a person, firm, corporation or other entity
related to Landlord which is in excess of the amount which would have been paid
in the absence of such relationship; (viii) any payments under a ground lease or
master lease; and (ix) costs incurred in the investigation and/or remediation of
Hazardous Materials which either existed on the Property on the Delivery Date or
were brought onto the Property by Landlord, its agents, employee or contractors.

(d)  Property Operating Expenses.  The term “Property Operating Expenses” shall
mean and include all Real Property Taxes, plus all Landlord’s Insurance Costs,
plus all Property Maintenance Costs.

(e)  Law.  The term “Law” or “Laws” shall mean any judicial decisions and any
statute, constitution, ordinance, resolution, regulation, rule, code,
administrative order, condition of approval, or other requirements of any
municipal, county, state, federal, or other governmental agency or authority
having jurisdiction over the parties to this Lease, the Leased Premises, the
Building or the Property, or any of them, in effect either at the Effective Date
of this Lease or at any time during the Lease Term, including, without
limitation, any regulation, order, or policy of any quasi-official entity or
body (e.g. a board of fire examiners or a public utility or special district).
 Except to the extent otherwise expressly provided in this Lease, to the extent
any Law or Restriction places limits on the Building or any portion thereof, or
on the Property or any portion thereof, such limits shall be equitably allocated
to the Leased Premises pro rata in the same proportion that the rentable square
footage of the Leased Premises bears to the rentable square footage of the
applicable Building or portion thereof, or the Property or portion thereof, as
applicable.

(f)  Lender.  The term “Lender” shall mean the holder of any promissory note or
other evidence of indebtedness secured by the Property or any portion thereof.

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(g)  Rent.  The term “Rent” shall mean collectively Base Monthly Rent and all
Additional Rent.

(h)  Restrictions.  The term “Restrictions” shall mean (as they may exist from
time to time) any and all covenants, conditions and restrictions, private
agreements, easements, and any other recorded documents or instruments affecting
the use of the Property, the Building, the Leased Premises, or the Outside
Areas.

13.13  General Waivers.  One party’s consent to or approval of any act by the
other party requiring the first party’s consent or approval shall not be deemed
to waive or render unnecessary the first party’s consent to or approval of any
subsequent similar act by the other party.  No waiver of any provision hereof,
or any waiver of any breach of any provision hereof, shall be effective unless
in writing and signed by the waiving party.  The receipt by Landlord of any rent
or payment with or without knowledge of the breach of any other provision hereof
shall not be deemed a waiver of any such breach.  No waiver of any provision of
this Lease shall be deemed a continuing waiver unless such waiver specifically
states so in writing and is signed by both Landlord and Tenant.  No delay or
omission in the exercise of any right or remedy accruing to either party upon
any breach by the other party under this Lease shall impair such right or remedy
or be construed as a waiver of any such breach theretofore or thereafter
occurring.  The waiver by either party of any breach of any provision of this
Lease shall not be deemed to be a waiver of any subsequent breach of the same or
any other provisions herein contained.

13.14  Miscellaneous.  Should any provisions of this Lease prove to be invalid
or illegal, such invalidity or illegality shall in no way affect, impair or
invalidate any other provisions hereof, and such remaining provisions shall
remain in full force and effect.  Time is of the essence with respect to the
performance of every provision of this Lease in which time of performance is a
factor.  Any copy of this Lease which is executed by the parties shall be deemed
an original for all purposes.  This Lease shall, subject to the provisions
regarding assignment, apply to and bind the respective heirs, successors,
executors, administrators and assigns of Landlord and Tenant.  The benefit of
each indemnity obligation of Tenant under this Lease is assignable in whole or
in part by Landlord.  The term “party” shall mean Landlord or Tenant as the
context implies.  If Tenant consists of more than one person or entity, then all
members of Tenant shall be jointly and severally liable hereunder.  If this
Lease is signed by an individual “doing business as “ or “dba” another person or
entity or entity name, the individual who signs this Lease will be deemed to be
the Tenant hereunder for all purposes.  Submission of this Lease for review,
examination or signature by Tenant does not constitute an offer to lease, a
reservation of or an option for lease, or a binding agreement of any kind, and
notwithstanding any inconsistent language contained in any other document, this
Lease is not effective as a lease or otherwise until execution and delivery by
both Landlord and Tenant, and prior to such mutual execution and delivery,
neither party shall have any obligation to negotiate and may discontinue
discussions and negotiations at any time for any reason or no reason.  This
Lease shall be construed and enforced in accordance with the Laws of the State
in which the Leased Premises are located.  The headings and captions in this
Lease are for convenience only and shall not be construed in the construction or
interpretation of any provision hereof.  When the context of this Lease
requires, the neuter gender includes the masculine, the feminine, a partnership,
corporation, limited liability company, joint venture, or other form of business
entity, and the singular includes the plural.  The terms “must,” “shall,”
“will,” and “agree” are mandatory.  The term “may” is permissive.  The term
“governmental agency” or “governmental authority” or similar terms shall
include, without limitation, all federal, state, city, local and other
governmental and quasi-governmental agencies, authorities, bodies, boards, etc.,
and any party or parties having enforcement rights under any Restrictions.  When
a party is required to do something by this Lease, it shall do so at its sole
cost and expense without right of reimbursement from the other party unless
specific provision is made therefor.  Where Landlord’s consent is required
hereunder, the consent of any Lender shall also be required.  Landlord and
Tenant shall both be deemed to have drafted this Lease, and the rule of
construction that a document is to be construed against the drafting party shall
not be employed in the construction or interpretation of this Lease.  Where
Tenant is obligated not to perform any act or is not permitted to perform any
act, Tenant is also obligated to restrain any others reasonably within its
control, including agents, invitees, contractors, subcontractors and employees,
from performing such act.  Landlord shall not become or be deemed a partner or a
joint venturer with Tenant by reason of any of the provisions of this Lease.

13.15  Patriot Act Compliance. 

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(a)  Tenant will use its good faith and commercially reasonable efforts to
comply with the Patriot Act (as defined below) and all applicable requirements
of governmental authorities having jurisdiction over Tenant or the Property,
including those relating to money laundering and terrorism.  Landlord shall have
the right to audit Tenant’s compliance with the Patriot Act and all applicable
requirements of governmental authorities having jurisdiction over Tenant or the
Property, including those relating to money laundering and terrorism.  In the
event that Tenant fails to comply with the Patriot Act or any such requirements
of governmental authorities, then Landlord may, at its option, cause Tenant to
comply therewith and any and all reasonable costs and expenses incurred by
Landlord in connection therewith shall be deemed Additional Charges and Rent and
shall be immediately due and payable.  For purposes hereof, the term “Patriot
Act” means the Uniting and Strengthening America by Providing Appropriate Tools
Required to Intercept and Obstruct Terrorism (USA PATRIOT ACT) Act of 2001, as
the same may be amended from time to time, and corresponding provisions of
future laws.

(b)  Neither Tenant nor any partner in Tenant or member of such partner nor any
owner of a direct or indirect interest in Tenant (a) is listed on any Government
Lists (as defined below), (b) is a person who has been determined by competent
authority to be subject to the prohibitions contained in Presidential Executive
Order No. 13224 (Sept. 23, 2001) or any other similar prohibitions contained in
the rules and regulations of OFAC (as defined below) or in any enabling
legislation or other Presidential Executive Orders in respect thereof, (c) has
been previously indicted for or convicted of any felony involving a crime or
crimes of moral turpitude or for any Patriot Act Offense (as defined below), or
(d) is currently under investigation by any governmental authority for alleged
criminal activity.  For purposes hereof, the term “Patriot Act Offense” means
any violation of the criminal laws of the United States of America or of any of
the several states, or that would be a criminal violation if committed within
the jurisdiction of the United States of America or any of the several states,
relating to terrorism or the laundering of monetary instruments, including any
offense under (a) the criminal laws against terrorism; (b) the criminal laws
against money laundering, (c) the Bank Secrecy Act, as amended, (d) the Money
Laundering Control Act of 1986, as amended, or the (e) Patriot Act.  “Patriot
Act Offense” also includes the crimes of conspiracy to commit, or aiding and
abetting another to commit, a Patriot Act Offense.  For purposes hereof, the
term “Government Lists” means (i) the Specially Designated Nationals and Blocked
Persons Lists maintained by Office of Foreign Assets Control (“OFAC”), (ii) any
other list of terrorists, terrorist organizations or narcotics traffickers
maintained pursuant to any of the Rules and Regulations of OFAC that Landlord
notified Tenant in writing is now included in “Governmental Lists”, or (iii) any
similar lists maintained by the United States Department of State, the United
States Department of Commerce or any other government authority or pursuant to
any Executive Order of the President of the United States of America that
Landlord notified Tenant in writing is now included in “Governmental Lists”.

Article 14  
LEGAL AUTHORITY
BROKERS AND ENTIRE AGREEMENT

14.1  Legal Authority.  If Tenant or any entity constituting Tenant is a
corporation, limited partnership, limited liability company, or other legal
entity, each individual executing this Lease on behalf of such corporation,
limited partnership, limited liability company, or other legal entity,
represents and warrants that Tenant is validly formed and duly authorized and
existing, that Tenant is qualified to do business in the State in which the
Leased Premises are located, that Tenant has the full right and legal authority
to enter into this Lease, and that he or she is duly authorized to execute and
deliver this Lease on behalf of Tenant in accordance with its terms.  Tenant
shall, within four (4) business days after the Effective Date of this Lease,
deliver to Landlord a certified copy of the resolution of its board of directors
(if a corporation), members and manager(s) (if a limited liability company), or
partners (if a limited partnership), authorizing or ratifying the execution of
this Lease, as well as a certified copy of binding resolutions of any guarantor
in form reasonably acceptable to Landlord, authorizing or ratifying the
execution of the applicable guaranty, and if Tenant or any entity constituting
Tenant fails to do so, the same shall be a material default on the part of
Tenant permitting Landlord at its sole election to terminate this Lease.

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14.2  Brokerage Commissions.  Tenant represents, warrants and agrees that it has
not had any dealings with any real estate broker(s), leasing agent(s), finder(s)
or salesmen, other than the Brokers (as named in Article 1) with respect to the
lease by it of the Leased Premises pursuant to this Lease, and that it will
indemnify, defend with competent counsel, and hold Landlord harmless from any
liability for the payment of any real estate brokerage commissions, leasing
commissions or finder’s fees claimed by any other real estate broker(s), leasing
agent(s), finder(s), or salesmen to be earned or due and payable by reason of
Tenant’s agreement or promise (implied or otherwise) to pay (or to have Landlord
pay) such a commission or finder’s fee by reason of its leasing the Leased
Premises pursuant to this Lease.  Notwithstanding any provision of this Lease to
the contrary, Landlord shall not pay any leasing commission or compensation of
any kind or type in connection with an extension of the term of this Lease, an
expansion of the Leased Premises, a lease or sublease of any other premises
leased by Tenant pursuant to any right of first offer or right of first refusal
or other similar right granted to Tenant.

14.3  Entire Agreement.  This Lease and the Exhibits (as described in
Article 1), which Exhibits are by this reference incorporated herein, constitute
the entire agreement between the parties, and there are no other agreements,
understandings or representations between the parties relating to the lease by
Landlord of the Leased Premises to Tenant, except as expressed herein.  No
subsequent changes, modifications or additions to this Lease shall be binding
upon the parties unless in writing and signed by both Landlord and Tenant.

14.4  Landlord’s Representations.  Tenant acknowledges that neither Landlord nor
any of its agents made any representations or warranties respecting the
Property, the Building or the Leased Premises, upon which Tenant relied in
entering into the Lease, which are not expressly set forth in this Lease.
 Tenant further acknowledges that neither Landlord nor any of its agents made
any representations as to (i) whether the Leased Premises may be used for
Tenant’s intended use under existing Law, or (ii) the suitability of the Leased
Premises for the conduct of Tenant’s business, or (iii) the exact square footage
of the Leased Premises or the Building, and that Tenant relies solely upon its
own investigations with respect to such matters.  Tenant expressly waives any
and all claims for damage by reason of any statement, representation, warranty,
promise or other agreement of Landlord or Landlord’s agent(s), if any, not
contained in this Lease or in any Exhibit attached hereto.

Article 15  
OPTIONS TO EXTEND

15.1  Option to Extend.  So long as Palo Alto Networks, Inc. is the Tenant
hereunder and occupies the entirety of the Leased Premises on the date the
option is exercised, and subject to the condition set forth in clause (b) below,
Tenant shall have two options to extend the term of this Lease with respect to
the entirety of the Leased Premises, the first for a period of five (5) years
from the expiration of the seventh (7th) year of the Lease Term (the “First
Extension Period”), and the second (the “Second Extension Period”) for a period
of five (5) years from the expiration of the First Extension Period, subject to
the following conditions:

(a)  Each option to extend shall be exercised, if at all, by notice of exercise
given to Landlord by Tenant not more than twelve (12) months nor less than six
(6) months prior to the expiration of the eighty-fourth (84th) month of the
Lease Term or the expiration of the First Extension Period, as applicable;

(b)  Anything herein to the contrary notwithstanding, if an Event of Default
exists under this Lease at the time Tenant exercises either extension option,
Landlord shall have, in addition to all of Landlord’s other rights and remedies
provided in this Lease, the right to terminate such option(s) to extend upon
notice to Tenant.

15.2  Fair Market Rent.  In the event the applicable option is exercised in a
timely fashion, the Lease shall be extended for the term of the applicable
extension period upon all of the terms and conditions of this Lease, provided
that the Base Monthly Rent for the First Extension Period shall be 95% of the
“Fair Market Rent” for the Leased Premises, and the Base Monthly Rent for the
Second Extension Period shall be 100% of the “Fair Market Rent” for the Leased
Premises, in each case increased as set forth below.  For purposes hereof, “Fair
Market Rent” shall mean the Base Monthly Rent determined pursuant to the process
described below.  At the end of the first 12 month period of the extension
Period, Base Monthly Rent shall be increased to reflect the change in the
Consumer

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Price Index for the San Francisco Metropolitan Area, All Items (the “CPI”), for
the 12-month period ending 11 months after the Lease Commencement Date, but in
no event shall Base Monthly Rent be increased less than 3% per annum compounded
annually nor more than 6% per annum compounded annually for such 12 month
period.  Base Monthly Rent shall be so adjusted at the end of each subsequent
12-month period during the Extension Period.  No leasing commissions shall be
due or payable to any broker retained by Tenant with regard to this Lease for
any Extension Period.

15.3  Tenant’s Election.  Within thirty (30) days after receipt of Tenant’s
notice of exercise, Landlord shall notify Tenant in writing of Landlord’s
estimate of the Base Monthly Rent for the applicable extension period, based on
the provisions of Paragraph 15.2 above.  Within thirty (30) days after receipt
of such notice from Landlord, Tenant shall have the right either to (i) accept
Landlord’s statement of Base Monthly Rent as the Base Monthly Rent for the
applicable extension period; or (ii) elect to arbitrate Landlord’s estimate of
Fair Market Rent, such arbitration to be conducted pursuant to the provisions
hereof.  Failure on the part of Tenant to require arbitration of Fair Market
Rent within such 30 day period shall constitute acceptance of the Base Monthly
Rent for the applicable extension period as calculated by Landlord.  If Tenant
elects arbitration, the arbitration shall be concluded within 90 days after the
date of Tenant’s election, subject to extension for an additional 30 day period
if a third arbitrator is required and does not act in a timely manner.  To the
extent that arbitration has not been completed prior to the expiration of any
preceding period for which Base Monthly Rent has been determined, Tenant shall
pay Base Monthly Rent at the rate calculated by Landlord, with the potential for
an adjustment to be made once Fair Market Rent is ultimately determined by
arbitration.

15.4  Rent Arbitration.  In the event of arbitration, the judgment or the award
rendered in any such arbitration may be entered in any court having jurisdiction
and shall be final and binding between the parties.  The arbitration shall be
conducted and determined in the City and County of San Francisco in accordance
with the then prevailing rules of the American Arbitration Association or its
successor for arbitration of commercial disputes except to the extent that the
procedures mandated by such rules shall be modified as follows:

(a)  Tenant shall make demand for arbitration in writing within thirty (30) days
after service of Landlord’s determination of Fair Market Rent given under
Paragraph 15.3 above, specifying therein the name and address of the person to
act as the arbitrator on its behalf.  The arbitrator shall be qualified as a
real estate appraiser familiar with the Fair Market Rent of similar industrial,
research and development, or office space in the City of Santa Clara area who
would qualify as an expert witness over objection to give opinion testimony
addressed to the issue in a court of competent jurisdiction.  Failure on the
part of Tenant to make a proper demand in a timely manner for such arbitration
shall constitute a waiver of the right thereto.  Within fifteen (15) days after
the service of the demand for arbitration, Landlord shall give notice to Tenant,
specifying the name and address of the person designated by Landlord to act as
arbitrator on its behalf who shall be similarly qualified.  If Landlord fails to
notify Tenant of the appointment of its arbitrator, within or by the time above
specified, then the arbitrator appointed by Tenant shall be the arbitrator to
determine the issue.

(b)  In the event that two arbitrators are chosen pursuant to Paragraph 15.4(a)
above, the arbitrators so chosen shall, within fifteen (15) days after the
second arbitrator is appointed determine the Fair Market Rent.  If the two
arbitrators shall be unable to agree upon a determination of Fair Market Rent
within such 15 day period, they, themselves, shall appoint a third arbitrator,
who shall be a competent and impartial person with qualifications similar to
those required of the first two arbitrators pursuant to Paragraph 15.4(a).  In
the event they are unable to agree upon such appointment within seven days after
expiration of such 15 day period, the third arbitrator shall be selected by the
parties themselves, if they can agree thereon, within a further period of
fifteen (15) days.  If the parties do not so agree, then either party, on behalf
of both, may request appointment of such a qualified person by the then
Presiding Judge of the California Superior Court having jurisdiction over the
County of Santa Clara, acting in his or her private and not in his or her
official capacity, and the other party shall not raise any question as to such
Judge’s full power and jurisdiction to entertain the application for and make
the appointment.  The three arbitrators shall decide the dispute if it has not
previously been resolved by following the procedure set forth below.

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(c)  Where an issue cannot be resolved by agreement between the two arbitrators
selected by Landlord and Tenant or settlement between the parties during the
course of arbitration, the issue shall be resolved by the three arbitrators
within 15 days of the appointment of the third arbitrator in accordance with the
following procedure.  The arbitrator selected by each of the parties shall state
in writing his determination of the Fair Market Rent supported by the reasons
therefor with counterpart copies to each party.  The arbitrators shall arrange
for a simultaneous exchange of such proposed resolutions.  The role of the third
arbitrator shall be to select which of the two proposed resolutions most closely
approximates his determination of Fair Market Rent.  The third arbitrator shall
have no right to propose a middle ground or any modification of either of the
two proposed resolutions.  The resolution he chooses as most closely
approximating his determination shall constitute the decision of the arbitrators
and be final and binding upon the parties.

(d)  In the event of a failure, refusal or inability of any arbitrator to act,
his successor shall be appointed by him, but in the case of the third
arbitrator, his successor shall be appointed in the same manner as provided for
appointment of the third arbitrator.  The arbitrators shall decide the issue
within fifteen (15) days after the appointment of the third arbitrator.  Any
decision in which the arbitrator appointed by Landlord and the arbitrator
appointed by Tenant concur shall be binding and conclusive upon the parties.
 Each party shall pay the fee and expenses of its respective arbitrator and both
shall share the fee and expenses of the third arbitrator, if any, and the
attorneys’ fees and expenses of counsel for the respective parties and of
witnesses shall be paid by the respective party engaging such counsel or calling
such witnesses.

(e)  The arbitrators shall have the right to consult experts and competent
authorities to obtain factual information or evidence pertaining to a
determination of Fair Market Rent, but any such consultation shall be made in
the presence of both parties with full right on their part to cross examine.
 The arbitrators shall render their decision and award in writing with
counterpart copies to each party.  The arbitrators shall have no power to modify
the provisions of this Lease.

Article 16
TELEPHONE SERVICE

Notwithstanding any other provision of this Lease to the contrary:

(a)  So long as the entirety of the Leased Premises is leased to Tenant:

(i)  Landlord shall have no responsibility for providing to Tenant any telephone
equipment, including wiring, within the Leased Premises or for providing
telephone service or connections from the utility to the Leased Premises; and

(ii)  Landlord makes no warranty as to the quality, continuity or availability
of the telecommunications services in the Building, and Tenant hereby waives any
claim against Landlord for any actual or consequential damages (including
damages for loss of business) in the event Tenant’s telecommunications services
in any way are interrupted, damaged or rendered less effective, except to the
extent caused by the gross negligence or willful misconduct of Landlord, its
agents or employees.  Tenant accepts the telephone equipment (including, without
limitation, the INC, as defined below) in its “AS-IS” condition, and Tenant
shall be solely responsible for contracting with a reliable third party vendor
to assume responsibility for the maintenance and repair thereof (which contract
shall contain provisions requiring such vendor to inspect the INC periodically
(the frequency of such inspections to be determined by such vendor based on its
experience and professional judgment), and requiring such vendor to meet local
and federal requirements for telecommunications material and workmanship).
 Landlord shall not be liable to Tenant and Tenant waives all claims against
Landlord whatsoever, whether for personal injury, property damage, loss of use
of the Leased Premises, or otherwise, due to the interruption or failure of
telephone services to the Leased Premises.  Tenant hereby holds Landlord
harmless and agrees to indemnify, protect and defend Landlord from and against
any liability for any damage, loss or expense due to any failure or interruption
of telephone service to the Leased Premises for any reason.  Tenant agrees to

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obtain loss of rental insurance adequate to cover any damage, loss or expense
occasioned by the interruption of telephone service.

(b)  At such time as the entirety of the Leased Premises is no longer leased to
Tenant, Landlord shall in its sole discretion have the right, by written notice
to Tenant, to elect to assume limited responsibility for INC, as provided below,
and upon such assumption of responsibility by Landlord, this subparagraph
(b) shall apply prospectively.

(i)  Landlord shall provide Tenant access to such quantity of pairs in the
Building intra-building network cable (“INC”) as is determined to be available
by Landlord in its reasonable discretion.  Tenant’s access to the INC shall be
solely by arrangements made by Tenant, as Tenant may elect, directly with AT&T
or Landlord (or such vendor as Landlord may designate), and Tenant shall pay all
reasonable charges as may be imposed in connection therewith.  AT&T’s charges
shall be deemed to be reasonable.  Subject to the foregoing, Landlord shall have
no responsibility for providing to Tenant any telephone equipment, including
wiring, within the Leased Premises or for providing telephone service or
connections from the utility to the Leased Premises, except as required by law.

(ii)  Tenant shall not alter, modify, add to or disturb any telephone wiring in
the Leased Premises or elsewhere in the Building without the Landlord’s prior
written consent.  Tenant shall be liable to Landlord for any damage to the
telephone wiring in the Building due to the act, negligent or otherwise, of
Tenant or any employee, contractor or other agent of Tenant.  Tenant shall have
no access to the telephone closets within the Building, except in the manner and
under procedures established by Landlord.  Tenant shall promptly notify Landlord
of any actual or suspected failure of telephone service to the Leased Premises.

(iii)  All costs incurred by Landlord for the installation, maintenance, repair
and replacement of telephone wiring in the Building shall be a Property
Maintenance Cost.

(iv)  Landlord makes no warranty as to the quality, continuity or availability
of the telecommunications services in the Building, and Tenant hereby waives any
claim against Landlord for any actual or consequential damages (including
damages for loss of business) in the event Tenant’s telecommunications services
in any way are interrupted, damaged or rendered less effective, except to the
extent caused by the gross negligence or willful misconduct of Landlord, its
agents or employees.  Tenant acknowledges that Landlord meets its duty of care
to Tenant with respect to the Building INC by contracting with a reliable third
party vendor to assume responsibility for the maintenance and repair thereof
(which contract shall contain provisions requiring such vendor to inspect the
INC periodically (the frequency of such inspections to be determined by such
vendor based on its experience and professional judgment), and requiring such
vendor to meet local and federal requirements for telecommunications material
and workmanship).  Subject to the foregoing, Landlord shall not be liable to
Tenant and Tenant waives all claims against Landlord whatsoever, whether for
personal injury, property damage, loss of use of the Leased Premises, or
otherwise, due to the interruption or failure of telephone services to the
Leased Premises.  Tenant hereby holds Landlord harmless and agrees to indemnify,
protect and defend Landlord from and against any liability for any damage, loss
or expense due to any failure or interruption of telephone service to the Leased
Premises for any reason.  Tenant agrees to obtain loss of rental insurance
adequate to cover any damage, loss or expense occasioned by the interruption of
telephone service.

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IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease as of the
respective dates below set forth with the intent to be legally bound thereby as
of the Effective Date of this Lease first above set forth.

   

 

   

LANDLORD:

   

   

   

Santa Clara Office Partners, LLC, a Delaware limited liability company

   

   

   

   

By:

Menlo Equities III LLC

   

   

Its:

Managing Member

   

   

   

   

   

   

   

By:

Menlo Equities LLC

   

   

   

Its:

Managing Member

   

   

   

   

   

   

   

   

   

By:

Menlo Equities, Inc.

   

   

   

   

   

Its:

Managing Member

   

   

   

   

   

   

   

   

   

   

   

   

   

   

Dated: October ___, 2010

   

   

   

   

By:

   

   

   

   

   

   

   

Henry Bullock, President

   

   

   

   

   

   

   

   

   

   

   

   

   

   

   

   

   

   

   

   

   

   

TENANT:

   

   

   

   

   

   

   

   

Palo Alto Networks, Inc., a Delaware corporation

   

   

   

   

   

   

   

Dated: October ___, 2010

By:

   

   

   

Printed Name: Michael Lehman

   

Title: Chief Financial Officer

   

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EXHIBIT B

   

FURNITURE, FIXTURES AND EQUIPMENT

   

 

OLCOTT FURNITURE INVENTORY

   

   

6/7/2013

   

   

   

ITEM

1st Flr. QTY.

2nd Flr. QTY.

TOTAL

   

   

   

   

Workstations

250

273

523

Office furniture

8

6

14

   

   

   

   

CHAIRS

   

   

   

Conference Rm. Chair

80

198

278

EBC Conference Rm. Chair

42

0

42

Guest Chair

16

19

35

Lobby/Lounge Chair

20

8

28

Training Rm. Chair

30

0

30

Tall Café Chair

12

0

12

Lunch Room Chair

0

100

100

   

   

   

   

TABLES

   

   

   

Conference Rm. Table

7

13

20

EBC Conference Rm. Table

2

0

2

Coffee/Lounge Table

6

3

9

Training Table

16

0

16

Lunch Room Table

0

23

23

Café Table

5

0

5

   

   

   

   

FILE CABINETS

   

   

   

4-Drawer File Cabinet

12

1

13

Vertical File Cabinet

4

0

4

   

   

   

   

MISCELLANEOUS

   

   

   

Freestanding White Boards

18

7

25

Metro Shelf

1

0

1

Bookshelf in open area

2

1

3

Podium

1

0

1

Freestanding Desk

4

1

5

2 post racks (all)

   

   

   

   

   

   

   

--------------------------------------------------------------------------------

   

 

OLCOTT FURNITURE INVENTORY

   

   

6/7/2013

   

   

   

ITEM

1st Flr. QTY.

2nd Flr. QTY.

TOTAL

   

   

   

   

Workstations

250

273

523

Office furniture

8

6

14

   

   

   

   

CHAIRS

   

   

   

Conference Rm. Chair

80

198

278

EBC Conference Rm. Chair

42

0

42

Guest Chair

16

19

35

Lobby/Lounge Chair

20

8

28

Training Rm. Chair

30

0

30

Tall Café Chair

12

0

12

Lunch Room Chair

0

100

100

   

   

   

   

TABLES

   

   

   

Conference Rm. Table

7

13

20

EBC Conference Rm. Table

2

0

2

Coffee/Lounge Table

6

3

9

Training Table

16

0

16

Lunch Room Table

0

23

23

Café Table

5

0

5

   

   

   

   

FILE CABINETS

   

   

   

4-Drawer File Cabinet

12

1

13

Vertical File Cabinet

4

0

4

   

   

   

   

MISCELLANEOUS

   

   

   

Freestanding White Boards

18

7

25

Metro Shelf

1

0

1

Bookshelf in open area

2

1

3

Podium

1

0

1

Freestanding Desk

4

1

5

2 post racks (all)

   

   

   

   

   

   

   

AV Equipment

   

   

   

Ceiling mounted AV Equipment (all)

   

   

   

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EXHIBIT C

   

FORM OF MASTER LESSOR CONSENT

   

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CONSENT TO SUBLEASE

This Agreement (“Agreement”) is made as of this _____ day of July, 2013, by and
among SANTA CLARA OFFICE PARTNERS LLC, a Delaware limited liability company
(“Landlord”), PALO ALTO NETWORKS, INC., a Delaware corporation (“Sublandlord”),
and GIGAMON INC., a Delaware corporation (“Subtenant”).

Recitals

A.  Landlord is the landlord and Sublandlord is the tenant under that certain
Lease dated as of October 20, 2010, as amended by that certain Amendment No. 1
to Lease dated as of March __ 2011 [original undated] and executed by Landlord
on April 12, 2011, as further amended by that certain Amendment No. 2 to Lease
(the “Second Amendment to Master Lease”) dated as of the date of this Consent to
Sublease (collectively, the “Master Lease”), for approximately 105,664 square
feet of space (the “Leased Premises”), comprising all of the rentable square
footage of the office building whose address is 3300 Olcott Street in Santa
Clara, California (the “Building”).

B.  Capitalized terms used but not defined in this Agreement shall have the
meanings assigned to them in the Master Lease.

C.  Sublandlord has requested that Landlord consent to the subletting by
Sublandlord to Subtenant of 100% of the Leased Premises (“Sublet Premises”),
pursuant to the Sublease dated the same date as this Agreement (the “Sublease”),
and to which Sublease this Agreement is attached.

Agreement

Now, Therefore, in consideration of the foregoing recitals and the mutual
covenants contained herein, Landlord, Sublandlord and Subtenant hereby agree as
follows:

Landlord hereby consents to the Sublease subject to and upon the following terms
and conditions, as to each of which Sublandlord and Subtenant expressly agree:

1.  Notwithstanding any provision of the Sublease to the contrary, nothing
contained in this Agreement or the Sublease shall:

(a)  operate as a consent to or approval or ratification by Landlord of any
specific provisions of the Sublease or as a representation or warranty by
Landlord, or cause Landlord to be estopped or bound in any way by any of the
provisions of the Sublease; or

(b)  be construed to modify, waive or affect (i) any of the provisions,
covenants or conditions in the Master Lease, (ii) any of Sublandlord’s
obligations under the Master Lease, or (iii) any rights or remedies of Landlord
under the Master Lease or otherwise; or to enlarge or increase Landlord’s
obligations or Sublandlord’s rights under the Master Lease or otherwise; or

(c)  be deemed to make Subtenant a third party beneficiary of the provisions of
the Master Lease, or create or permit any direct right of action by Subtenant
against Landlord for breach of the covenant of quiet enjoyment or any other
covenant of Landlord under the Master Lease; or

(d)  be construed to waive any past, present or future breach or default on the
part of Sublandlord under the Master Lease.

2.  This consent is not assignable.

--------------------------------------------------------------------------------

3.  The Sublease shall be subject and subordinate at all times to the Master
Lease and to all of its provisions, covenants and conditions. Except for rent
payable under the Master Lease, Sublandlord’s obligations to remove or restore
the Alterations which were the subject of the Alteration Approval Letters (as
defined in the Second Amendment to Master Lease), and Sublandlord’s obligations
with respect to any Hazardous Materials first introduced to the Leased Premises
or Property prior to the delivery of possession of the Sublet Premises to
Subtenant under the Sublease (none of which is Subtenant obligated to perform),
Subtenant shall perform faithfully and be bound by all the terms, covenants,
conditions, provisions and agreements of the Master Lease, with respect to the
period covered by the Sublease, but only to the extent applicable to the Sublet
Premises. In the event that Subtenant exercises the option set forth in
Section 19 below and becomes a direct tenant of Landlord’s pursuant to the
Option Term Lease, or in the event Landlord, in its sole and absolute
discretion, agrees to enter into the Alternative Direct Lease (as defined in the
Second Amendment to Master Lease), Subtenant, with Sublandlord’s consent, may at
that time elect to have certain of the remaining removal and restoration and
surrender obligations set forth in Paragraph 2.6 of the Master Lease be deferred
to the expiration or earlier termination of the Option Term Lease or the
Alternative Direct Lease, as applicable, such election (a) to be made by written
notice signed by both Sublandlord and Subtenant and delivered to Landlord
simultaneously with Subtenant’s execution and delivery of the Option Term Lease,
(b) to include the removal and restoration and surrender obligations being
deferred and Subtenant’s assumption of such obligations, and (c) be in form
satisfactory to Landlord in Landlord’s reasonable discretion. In case of any
conflict between the provisions of the Master Lease and the provisions of the
Sublease, the provisions of the Master Lease shall prevail unaffected by the
Sublease; provided, however, that as between Sublandlord and Subtenant only, the
provisions of the Sublease shall govern and control. Subtenant acknowledges and
agrees that Landlord shall have no obligation to enter into the Alternative
Direct Lease, and may refuse to do so for any reason or no reason.

4.  Neither the Sublease nor this consent thereto shall release or discharge the
Sublandlord from any liability under the Master Lease. Sublandlord shall remain
liable and responsible for the full performance and observance of all the
provisions, covenants and conditions set forth in the Master Lease to be
performed and observed by Sublandlord. Any breach or violation of any provision
of the Master Lease by Subtenant shall constitute a default by Sublandlord in
fulfilling such provision.

5.  This consent by Landlord shall not be construed as a consent by Landlord to
any further subletting as defined in the Master Lease (a “subletting”) by
Sublandlord or Subtenant or to any assignment as defined in the Master Lease (an
“assignment”) by Sublandlord of the Master Lease or assignment by Subtenant of
the Sublease, whether or not the Sublease purports to permit the same, and,
without limiting the generality of the foregoing, both Sublandlord and Subtenant
agree that Subtenant has no right whatsoever to assign, mortgage or encumber the
Sublease nor to sublet any portion of the Sublet Premises or permit any portion
of the Sublet Premises to be used or occupied by any other party: (a) without
the prior written consent of Sublandlord, as and to the extent Sublandlord’s
consent would be required under the Sublease, and (b) without the prior written
consent of Landlord, as and to the extent Landlord’s consent would be required
under the Master Lease. This consent shall not be construed as a consent by
Landlord to any modification, amendment, extension or renewal of the Sublease.
Sublandlord and Subtenant acknowledge and agree that except for any exercise of
Subtenant’s rights under Section 19 of this Agreement, the attempted exercise of
any option to extend the term of the Sublease or to expand the Sublet Premises
by the Subtenant shall, for purposes of the Master Lease and this Agreement,
constitute a further subletting subject to the provisions of this Article 5.

6.  In the event of Sublandlord’s default under any of the provisions of the
Master Lease beyond applicable notice and cure periods expressly set forth in
the Master Lease, the rent due from Subtenant under the Sublease shall be deemed
assigned to Landlord and Landlord shall have the right, upon such default, at
any time at its option, to give notice to Subtenant of such assignment. Landlord
shall credit Sublandlord with any rent received by Landlord under such
assignment and Sublandlord acknowledges its approval of any such assignment and
payment of rent by Subtenant to Landlord (and Sublandlord shall credit Subtenant
under the Sublease with any rent paid by Subtenant to Landlord under such
assignment), but the acceptance of any payment on account of rent from Subtenant
as the result of any such default shall in no manner whatsoever serve to release
Sublandlord from any

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liability under the terms, covenants, conditions, provisions or agreements under
the Master Lease, except to the extent of the rent so credited.

7.  If the Master Lease shall expire or terminate during the term of the
Sublease due either to condemnation or to destruction by fire or other cause,
the Sublease and its term shall thereupon expire and come to an end and
Subtenant shall vacate the Sublet Premises on or before the effective date of
such termination. If the Master Lease shall expire or terminate during the term
of the Sublease for any reason other than either condemnation or destruction by
fire or other cause, Landlord will so notify Sublandlord and Subtenant in
writing and within not more than thirty (30) days after the giving of such
written notice, Landlord will, in its sole discretion, either: (a) elect by
written notice to all such parties to require Subtenant to vacate the Sublet
Premises in not less than seventy-five (75) days after such written election, in
which event the Sublease and its term shall expire and come to an end on the
effective date stated in such notice; or (b) elect (by written notice to all
such parties) to continue the Sublease (without any additional or further
agreement of any kind on the part of Subtenant) with the same force and effect
as if Landlord as landlord and Subtenant as tenant had entered into a lease as
of the effective date of such expiration, termination or surrender for a term
equal to the then unexpired term of the Sublease and containing the same terms
and conditions as those contained in the Sublease, in which event Subtenant
shall attorn to Landlord and Landlord and Subtenant shall have the same rights,
obligations and remedies thereunder as were had by Sublandlord and Subtenant
thereunder prior to such effective date, except that in no event shall Landlord
be (1) liable for any act or omission by Sublandlord, (2) subject to any offsets
or defenses which Subtenant had or might have against Sublandlord that has not
been received by Landlord, (3) bound by any rent or additional rent or other
payment paid by Subtenant to Sublandlord in advance that has not been paid to
Landlord by Sublandlord, or (4) bound by any amendment to the Sublease not
consented to by Landlord. If Landlord fails to notify Sublandlord and Subtenant
of its election hereunder within the thirty (30) day period provided above, the
Sublease and its term shall automatically expire and come to an end on the date
which is seventy-five (75) days after the end of such thirty (30) day period.
Upon expiration of the Sublease pursuant to the provisions of this Article 7, in
the event of the failure of Subtenant to vacate the Sublet Premises as herein
provided, Landlord shall be entitled to all of the rights and remedies available
to a landlord against a tenant holding over without consent after the expiration
of a term.

8.  In addition to complying with Sublandlord’s obligations under the Master
Lease to maintain insurance, Subtenant shall add and maintain Landlord as an
additional insured under Subtenant’s commercial general liability insurance
policies. Notwithstanding anything to the contrary in Master Lease, Sublease or
this Agreement, Landlord hereby releases Subtenant and its respective partners,
principals, shareholders, members, officers, agents, employees and servants, and
Subtenant hereby releases Landlord and its respective partners, principals,
shareholders, members, officers, agents, employees and servants, from any and
all liability for loss, damage or injury to the property of the other in or
about the Sublet Premises or the Property which is caused by or results from any
risk insured against under any property insurance policy actually carried or
required to be carried by any such parties under this Sublease or the Master
Lease. Each party shall cause each insurance policy obtained by it to provide
that the insurer waives all right of recovery against the other party and its
agents and employees in connection with any damage or injury covered by the
policy.

9.  Both Sublandlord and Subtenant shall be and continue to be liable for the
payment of (a) all bills rendered by Landlord for charges incurred by or imposed
upon Subtenant for services and materials supplied to the Sublet Premises beyond
that which is required by the terms of the Master Lease, and (b) any additional
costs incurred by Landlord in accordance with its rights under or pursuant to
the Master Lease and this Agreement for maintenance and repair of the Sublet
Premises as the result of Subtenant occupying the Sublet Premises (including,
but not limited to, any excess costs to Landlord of services furnished to or for
the Sublet Premises).

10.  Notwithstanding anything to the contrary contained in the Sublease, all
requests for any service to be supplied by Landlord to the Sublet Premises, all
requests to make improvements or alterations to the Sublet Premises, all
requests to further sublet the Sublet Premises or assign the Sublease and all
other requests for Landlord’s consent or approval must be made by Sublandlord on
behalf of Subtenant.

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11.  Subtenant represents, warrants and agrees that it has not had any dealings
with any real estate broker(s), leasing agent(s), finder(s) or salesmen, other
than the Cresa with respect to the Sublease, and that it will indemnify, defend
with competent counsel approved by Landlord, and hold Landlord harmless from any
liability for the payment of any real estate brokerage commissions, leasing
commissions or finder’s fees claimed by any other real estate broker(s), leasing
agent(s), finder(s), or salesmen to be earned or due and payable by reason of
Subtenant’s agreement or promise (implied or otherwise) to pay (or to have
Landlord pay) such a commission or finder’s fee by reason of the Sublease. In
reliance on the foregoing, Landlord shall pay a leasing commission to Cresa on
account of this Sublease and the Second Amendment to Master Lease in the
aggregate amount of $919,325 pursuant to, in accordance with, and subject to the
conditions contained in, a separate written agreement signed by Landlord and
Cresa.

12.  Sublandlord and Subtenant understand and acknowledge that Landlord’s
consent herein is not a consent to any improvement or alteration work to be
performed in the Sublet Premises (including without limitation any improvement
work contemplated in the Sublease), that Landlord’s consent for such work must
be separately sought, and that any such work shall be subject to all the
provisions of the Master Lease with respect thereto.

13.  In the event of any conflict between the provisions of this Agreement and
the provisions of the Sublease, the provisions of this Agreement shall prevail
unaffected by the Sublease; provided, however, that as between Sublandlord and
Subtenant only, the provisions of the Sublease shall govern and control.

14.  Any notice or communication that any party hereto may desire or be required
to give to any other party under or with respect to this Agreement shall be
given prepaid, by hand delivery, Federal Express, or other nationally recognized
overnight courier service, addressed to such other party, in the case of
Landlord and Sublandlord, at the address set forth in the Master Lease, and in
the case of Subtenant, at the Sublet Premises, or in any case at such other
address any party may have designated by notice given in accordance with the
provisions of this paragraph.

15.  Sublandlord and Subtenant agree, at any time and from time to time, upon
not less than fifteen (15) days’ prior notice by Landlord, to execute,
acknowledge and deliver to Landlord a statement in writing certifying that the
Sublease is unmodified and in full force and effect (or, if there have been
modifications, that the Sublease is in full force and effect as modified and
stating the modification), and the dates to which the annual base rental,
additional rent and other charges have been paid, and stating whether or not
Sublandlord or Subtenant is in default in performance of any covenant,
agreement, term, provision or condition contained in the Sublease and, if so,
specifying each such default, it being intended that any such statement
delivered pursuant hereto may be relied upon by Landlord and any prospective
purchaser or lessee of the Building, or any trustee or beneficiary under any
deed of trust affecting the Building. Sublandlord and Subtenant also agree to
execute and deliver from time to time such other estoppel certificates as
Landlord or any lender may require with respect to the Lease or the Sublease.

16.  In the event of any arbitration or action or proceeding at law or in equity
between or among the parties to this Agreement as a consequence of any
controversy, claim or dispute relating to this Agreement or the breach thereof,
or to enforce any of the provisions and/or rights hereunder, the unsuccessful
party or parties to such arbitration, action or proceeding shall pay to the
prevailing party or parties all costs and expenses, including reasonable
attorney’s fees incurred therein by such prevailing party or parties, and if
such prevailing party or parties shall recover judgment in any such arbitration,
action or proceeding, such costs, expenses and fees shall be included in and as
part of such judgment.

17.  Each of Subtenant and Sublandlord agrees, jointly and severally, that it
shall indemnify, defend and hold Landlord harmless from and against any and all
claims arising out of (a) Subtenant’s use of the Sublet Premises or any part
thereof for the conduct of its business, or (b) any activity, work or other
thing done, permitted or suffered by Subtenant in or about the Building or the
Sublet Premises, or any part thereof, or (c) any breach or default in the
performance of any obligation on Subtenant’s part to be performed under the
terms of the Sublease

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or this Agreement, or (d) any act, omission, or negligence of Subtenant or any
officer, agent, employee, contractor, servant, invitee or guest of Subtenant;
and in each case from and against any and all damages, losses, liabilities,
lawsuits, judgments, and costs and expenses (including without limitation
reasonable attorneys’ fees) arising in connection with any such claim or claims
as described in clauses (a) through (d) above, or any action or proceeding
brought thereon. The foregoing indemnification shall not apply to losses or
damages to the extent proximately caused by the negligence or willful misconduct
of Landlord or any of Landlord’s agents, employees or contractors acting on
Landlord’s behalf. If any such action or proceeding be brought against Landlord,
the indemnifying party, upon notice from Landlord, shall defend such action or
proceeding at the indemnifying party’s sole expense by counsel reasonably
satisfactory to Landlord. Subtenant, as a material part of the consideration to
Landlord, hereby assumes all risk of damage or loss to property or injury or
death to persons (except to the extent any such injury or death to persons is
caused by the gross negligence or willful misconduct of Landlord or any of
Landlord’s authorized representatives), in, upon or about the Sublet Premises,
from any cause, and Subtenant hereby waives all claims in respect thereof
against Landlord (except for claims arising from any injury or death to persons
to the extent caused by the gross negligence or willful misconduct of Landlord
or any of Landlord’s authorized representatives). Landlord and Sublandlord
hereby agree that neither the foregoing nor any other provisions of this
Agreement shall be interpreted to narrow the scope of any indemnification,
defense, or hold harmless obligations of Sublandlord under the Master Lease.

18.  Notwithstanding anything to the contrary in the Master Lease or this
Agreement, Landlord hereby agrees that (i) none of the following shall
constitute a Transfer of the Sublease or the Master Lease: any change in the
controlling ownership interest of the entity that constitutes Subtenant which
results from any of the following: (a) the infusion of additional equity capital
in Subtenant or an initial public offering of equity securities of Subtenant
under the Securities Act of 1933, as amended, which results in Subtenant’s stock
being traded on a national securities exchange, including, but not limited to,
the NYSE, the NASDAQ Stock Market or the NASDAQ Small Cap Market System (a
“National Exchange”); or (b) any transfer or sale of the stock or other
ownership interest in Subtenant (1) to the spouse(s) and/or children of a
shareholder of Subtenant, (2) to any trust, the beneficiary(ies) of which are
family members of a shareholder of Subtenant, (3) by reason of bequest or
inheritance, or (4) in connection with the issuance of warrants or stock options
to purchase Subtenant’s stock, and the exercise of any purchase rights under any
such warrants or stock options; provided, that any such issuance or exercise
does not result in a change in the controlling percentage (as defined in the
Master Lease) of the stock or other equity interests of Subtenant; and
(ii) Subtenant may assign the Sublease or sublet the Sublet Premises, without
any “recapture right” by Landlord and without any obligation to pay to Landlord
“assignment consideration” or “excess rentals” (as such terms are defined in the
Master Lease) to any entity (i) controlling, controlled by or having fifty
percent (50%) or more common control with Subtenant, or (ii) resulting from a
merger, non-bankruptcy reorganization or consolidation with Subtenant or
acquisition of substantially all of the assets and/or substantially all of the
stock of Subtenant (each, a “Permitted Transferee”); provided that (w) any such
entity shall assume the obligations and liabilities of Subtenant under the
Sublease (or such of such obligations and liabilities as are to be performed by
the Subtenant under the terms of the applicable sublease in the event of a
sublease), and no such assignment or sublease shall in any manner release
Subtenant from its primary liability under the Sublease, (x) any such entity has
a net worth at the time of such assignment or sublease that is sufficient to
undertake the financial obligations under the Sublease and at least equal to
that of Subtenant immediately before the merger, acquisition or other
transaction, (y) Subtenant provides Landlord with at least ten (10) days prior
written notice of such transaction (or within ten (10) days after such
transaction if Subtenant is prevented by law or any bona fide confidentiality
agreement from providing prior notice to Landlord) together with such
information reasonably required by Landlord that establishes that the underlying
transaction complies with the provisions of this sentence and (z) Subtenant is
not in monetary or material non-monetary default under the Sublease beyond
applicable notice and cure periods at the time of the proposed Transfer.

19.  So long as Gigamon Inc. or a Permitted Transferee is then the Subtenant and
occupies not less than seventy-five percent (75%) of the Sublet Premises,
Landlord hereby grants Subtenant one (1) option to lease the entirety of the
Sublet Premises for a period of five (5) years commencing from the expiration of
the initial term of the Master Lease (the “Option Term”), subject to the
following conditions:

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(a)  The option to lease shall be exercised, if at all, by notice of exercise
given to Landlord by Subtenant not more than eighteen (18) months nor less than
twelve (12) months prior to the expiration of the term of the Master Lease.

(b)  Anything herein to the contrary notwithstanding, if an Event of Default
exists under the Sublease or the Master Lease at the time Subtenant exercises
the extension option, Landlord shall have, in addition to all of Landlord’s
other rights and remedies provided in the Master Lease, the right to terminate
such option to lease upon notice to Subtenant. The foregoing shall not be deemed
to prohibit Subtenant from curing any Event of Default prior to exercising such
option.

(c)  In the event the option is exercised in a timely fashion, Tenant shall
lease the Sublet Premises from Landlord for the Option Term upon all of the
terms and conditions of the Master Lease, but (i) as modified by Section 3 of
this Agreement, (ii) deleting Article 15 thereof, and (iii) deleting any
obligations of Landlord under the Lease (including the Work Letter) or otherwise
to pay any allowances or perform any work other than as required by Paragraph
5.1(b) of the Master Lease (the “Option Term Lease”), provided that the Base
Monthly Rent for the Option Term shall be the “Fair Market Rent” for the Sublet
Premises, increased as set forth below. For purposes hereof, “Fair Market Rent”
shall mean the Base Monthly Rent determined pursuant to the process described
below. At the end of the first 12 month period of the Option Term, Base Monthly
Rent shall be increased to reflect the change in the Consumer Price Index for
the San Francisco Metropolitan Area, All Items (the “CPI”), for the 12-month
period ending 11 months after the commencement date of the Option Term, but in
no event shall Base Monthly Rent be increased less than 3% per annum compounded
annually nor more than 6% per annum compounded annually for such 12 month
period. Base Monthly Rent shall be so adjusted at the end of each subsequent
12-month period during the Option Term. No leasing commissions shall be due or
payable to any broker retained by Subtenant with regard to such Option Term
Lease.

(d)  Subtenant’s Election. Within thirty (30) days after receipt of Subtenant’s
notice of exercise, Landlord shall notify Subtenant in writing of Landlord’s
estimate of the Base Monthly Rent for the Option Term, based on the provisions
of Paragraph (c) above. Within thirty (30) days after receipt of such notice
from Landlord, Subtenant shall have the right either to (i) accept Landlord’s
statement of Base Monthly Rent as the Base Monthly Rent for the Option Term; or
(ii) elect to arbitrate Landlord’s estimate of Fair Market Rent, such
arbitration to be conducted pursuant to the provisions hereof. Failure on the
part of Subtenant to require arbitration of Fair Market Rent within such 30-day
period shall constitute acceptance of the Base Monthly Rent for the Option Term
as calculated by Landlord. If Subtenant elects arbitration, the arbitration
shall be concluded within 90 days after the date of Subtenant’s election,
subject to extension for an additional 30-day period if a third arbitrator is
required and does not act in a timely manner. To the extent that arbitration has
not been completed prior to the expiration of any preceding period for which
Base Monthly Rent has been determined, Subtenant shall pay Base Monthly Rent
under the Option Term Lease at the rate due for the last month of the term of
the Sublease, with the potential for an adjustment to be made once Fair Market
Rent is ultimately determined by arbitration.

(e)  Rent Arbitration. In the event of arbitration, the judgment or the award
rendered in any such arbitration may be entered in any court having jurisdiction
and shall be final and binding between the parties. The arbitration shall be
conducted and determined in the City and County of San Francisco in accordance
with the then prevailing rules of the American Arbitration Association or its
successor for arbitration of commercial disputes except to the extent that the
procedures mandated by such rules shall be modified as follows:

(i)  Subtenant shall make demand for arbitration in writing within thirty
(30) days after service of Landlord’s determination of Fair Market Rent given
under Paragraph (d) above, specifying therein the name and address of the person
to act as the arbitrator on its behalf. The arbitrator shall be a real estate
broker with at least ten (10) years of experience in the City of Santa Clara
market area, or a qualified as a real estate appraiser familiar with the Fair
Market Rent of similar industrial, research and development, or office space in
the City of Santa Clara area who would qualify as an expert witness over
objection to give opinion testimony addressed to the issue in a court of
competent jurisdiction. Failure on the part of Subtenant to make a proper

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demand in a timely manner for such arbitration shall constitute a waiver of the
right thereto. Within fifteen (15) days after the service of the demand for
arbitration, Landlord shall give notice to Subtenant, specifying the name and
address of the person designated by Landlord to act as arbitrator on its behalf
who shall be similarly qualified. If Landlord fails to notify Subtenant of the
appointment of its arbitrator, within or by the time above specified, then the
arbitrator appointed by Subtenant shall be the arbitrator to determine the
issue.

(ii)  In the event that two arbitrators are chosen pursuant to Paragraph (e)(i)
above, the arbitrators so chosen shall, within fifteen (15) days after the
second arbitrator is appointed determine the Fair Market Rent. If the two
arbitrators shall be unable to agree upon a determination of Fair Market Rent
within such 15-day period, they, themselves, shall appoint a third arbitrator,
who shall be a competent and impartial person with qualifications similar to
those required of the first two arbitrators pursuant to Paragraph (e)(i). In the
event they are unable to agree upon such appointment within seven days after
expiration of such 15-day period, the third arbitrator shall be selected by the
parties themselves, if they can agree thereon, within a further period of
fifteen (15) days. If the parties do not so agree, then either party, on behalf
of both, may request appointment of such a qualified person by the then
Presiding Judge of the California Superior Court having jurisdiction over the
County of Santa Clara, acting in his or her private and not in his or her
official capacity, and the other party shall not raise any question as to such
Judge’s full power and jurisdiction to entertain the application for and make
the appointment. The three arbitrators shall decide the dispute if it has not
previously been resolved by following the procedure set forth below.

(iii)  Where an issue cannot be resolved by agreement between the two
arbitrators selected by Landlord and Subtenant or settlement between the parties
during the course of arbitration, the issue shall be resolved by the three
arbitrators within 15 days of the appointment of the third arbitrator in
accordance with the following procedure. The arbitrator selected by each of the
parties shall state in writing his determination of the Fair Market Rent
supported by the reasons therefor with counterpart copies to each party. The
arbitrators shall arrange for a simultaneous exchange of such proposed
resolutions. The role of the third arbitrator shall be to select which of the
two proposed resolutions most closely approximates his determination of Fair
Market Rent. The third arbitrator shall have no right to propose a middle ground
or any modification of either of the two proposed resolutions. The resolution he
chooses as most closely approximating his determination shall constitute the
decision of the arbitrators and be final and binding upon the parties.

(iv)  In the event of a failure, refusal or inability of any arbitrator to act,
his successor shall be appointed by him, but in the case of the third
arbitrator, his successor shall be appointed in the same manner as provided for
appointment of the third arbitrator. The arbitrators shall decide the issue
within fifteen (15) days after the appointment of the third arbitrator. Any
decision in which the arbitrator appointed by Landlord and the arbitrator
appointed by Subtenant concur shall be binding and conclusive upon the parties.
Each party shall pay the fee and expenses of its respective arbitrator and both
shall share the fee and expenses of the third arbitrator, if any, and the
attorneys’ fees and expenses of counsel for the respective parties and of
witnesses shall be paid by the respective party engaging such counsel or calling
such witnesses.

(v)  The arbitrators shall have the right to consult experts and competent
authorities to obtain factual information or evidence pertaining to a
determination of Fair Market Rent, but any such consultation shall be made in
the presence of both parties with full right on their part to cross examine. The
arbitrators shall render their decision and award in writing with counterpart
copies to each party. The arbitrators shall have no power to modify the
provisions of the Option Term Lease.

20.  Tenant and Subtenant have asked Landlord to specifically acknowledge, and
Landlord hereby acknowledges, that (a) Subtenant shall have all of Tenant’s
rights under the Master Lease regarding signage and parking which have been
granted by Tenant to Subtenant pursuant to the Sublease, and (b) Landlord will
not charge any additional amount to Subtenant regarding signage and parking that
is not provided for in the Master Lease.

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21.  This Agreement shall be construed in accordance with the laws of the State
of California and, together with the Sublease and the Master Lease, contains the
entire agreement of the parties hereto with respect to the subject matter hereof
and may not be changed or terminated orally or by course of conduct.

22.  Sublandlord agrees to reimburse to Landlord all reasonable costs and
reasonable attorneys’ fees incurred by Landlord in conjunction with the
processing and documentation of the Sublease.

23.  The obligations of the parties to this Agreement shall survive the
expiration or termination of the Lease and the Sublease.

24.  This Agreement is hereby incorporated into the Sublease and shall be
attached to the Sublease.

25.  The effectiveness of this Agreement and the parties’ obligations hereunder
are subject to the receipt by Landlord, no later than ten (10) business days
after the date hereof, of the Lender’s Consent. Landlord hereby agrees to use
diligent efforts to obtain the Lender’s Consent by such date; however, if
Landlord does not receive the Lender’s Consent by such date, this Agreement
shall, at any party’s option by written notice to the other parties delivered
prior to receipt of Lender’s Consent (if received after such 10-business-day
period), thereupon be deemed terminated and of no further force or effect, and
no party shall have any further rights, obligations, or liabilities hereunder.
As used herein, the term “Lender’s Consent” means a written consent to this
Agreement in form reasonably satisfactory to the parties, executed by the holder
of the promissory note secured by that certain Construction Deed of Trust,
Assignment of Rents and Leases, Security Agreement and Fixture Filing
(encumbering the fee interest in the real property of which the Sublet Premises
are a part), recorded on April 9, 2008 in the Official Records of Santa Clara,
California, at Series No. 19806764, as amended.

[Signatures On Following Page]

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In Witness Whereof, the parties hereto have duly executed this Agreement as of
the day and year first above written.

   

 

LANDLORD:

   

Santa Clara Office Partners LLC,

a Delaware limited liability company

   

By:

Menlo Equities III LLC,

   

a California limited liability company,

   

its Managing Member

   

   

By:

Menlo Equities LLC,

   

a California limited liability company,

   

its Managing Member

   

   

By:

Diamant Investments LLC,

   

a Delaware limited liability company,

   

its Member

   

   

   

   

By:

   

   

Rick Holmstrom, Manager

   

   

   

   

SUBLANDLORD:

   

Palo Alto Networks, Inc., a Delaware corporation

   

By:

   

   

   

Its:

   

   

Its: Chief Financial Officer

   

   

SUBTENANT:

   

Gigamon Inc., a Delaware corporation

   

By:

   

   

   

   

   

Its:

President

   

   

By:

   

Its:

Chief Financial Officer

   

   

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EXHIBIT D

SECOND AMENDMENT TO MASTER LEASE

   

   

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AMENDMENT NO. 2 TO LEASE

This AMENDMENT NO. 2 TO LEASE (this “Amendment”) is entered into as of June __,
2013, by and between SANTA CLARA OFFICE PARTNERS LLC, a Delaware limited
liability company (“Landlord”), on the one hand, and PALO ALTO NETWORKS, INC., a
Delaware corporation (“Tenant”), on the other hand, with reference to the
following facts:

R E C I T A L S

A.  Landlord and Tenant are parties to that certain Lease dated as of
October 20, 2010, as amended by that certain Amendment No. 1 to Lease dated as
of March __, 2011 [original undated] and executed by Landlord on April 12, 2011
(collectively, the “Lease”), concerning certain premises located at 3300 Olcott
Street in Santa Clara, California.

B.  Capitalized terms used but not defined in this Amendment shall have the
meanings assigned to them in the Lease.

C.  Tenant desires to sublease the entirety of the Leased Premises to Gigamon
Inc., a Delaware corporation (“Subtenant”), pursuant to a Sublease in the
precise form of Exhibit A attached to this Amendment (the “Sublease”).  Pursuant
to the Lease, Landlord’s consent is required in order for Tenant and Subtenant
to enter into the Sublease.

D.  Landlord is willing to consent to such Sublease, on the terms and conditions
set forth in this Amendment.

A G R E E M E N T

NOW, THEREFORE, in consideration of the foregoing Recitals, the mutual covenants
and agreements contained herein, and further good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, Landlord and
Tenant hereby agree as follows:

1.  Conditions.  The following conditions must be satisfied or waived in writing
by Landlord; if any such condition is neither satisfied nor so waived, then at
Landlord’s option in its sole discretion, this Amendment shall be deemed null
and void and of no force or effect.  The conditions are:

A.  the full execution and delivery of the Sublease by Tenant and Subtenant, and
the delivery to Landlord of one fully-executed original thereof;

B.  the execution and delivery of this Amendment by Landlord and Tenant; and

C.  the satisfaction or written waiver by Landlord of the condition set forth in
Section 7 below; and

D.  the full execution and delivery of a Consent to Sublease in the precise form
of Exhibit B attached to this Amendment (the “Consent to Sublease”).

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2.  Base Monthly Rent.  Upon satisfaction or written waiver by Landlord of the
foregoing conditions, Article 1 of the Lease is hereby amended by replacing the
definition of “Base Monthly Rent” therein with the following:

Base Monthly Rent:  The term “Base Monthly Rent” shall mean the following:

   

 

Period:

Base Monthly Rent:

4/1/11 – 3/31/12

$0

4/1/12 – 3/31/13

$124,000.00

4/1/13 – 9/30/13

$128,000.00

10/1/13 – 6/30/14

$0

7/1/14 – 12/31/14

$235,630.72

1/1/15 – 12/31/15

$243,027.20

1/1/16 – 12/31/16

$250,423.68

1/1/17 – 12/31/17

$257,820.16

1/1/18 – 3/31/18

$265,216.64

3.  No Assignment Consideration or Sublease Profits.  Landlord and Tenant
acknowledge and agree that there is no assignment consideration or sublease
profits resulting from the Sublease.

4.  Mutual Waiver of Subrogation.  Paragraph 9.3 of the Lease is hereby amended
in its entirety to read as follows:

Notwithstanding anything to the contrary in this Lease, Landlord hereby releases
Tenant and its respective partners, principals, shareholders, members,
shareholders, officers, agents, employees and servants, and Tenant hereby
releases Landlord and its respective partners, principals, members,
shareholders, officers, agents, employees and servants, from any and all
liability for loss, damage or injury to the property of the other in or about
the Leased Premises or the Property which is caused by or results from any risk
insured against under any property insurance policy actually carried or required
to be carried by any such parties under this Lease.  Each party shall cause each
insurance policy obtained by it to provide that the insurer waives all right of
recovery against the other party and its agents and employees in connection with
any damage or injury covered by the policy.

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5.  Notices.  Paragraph 13.10 of the Lease is hereby amended in its entirety to
read as follows:

Any notice required or permitted to be given under this Lease other than
statutory notices shall be in writing and (i) personally delivered, (ii) sent by
United States mail, registered or certified mail, postage prepaid, return
receipt requested, (iii) sent by Federal Express or similar nationally
recognized overnight courier service, or (iv) transmitted by facsimile with a
hard copy sent within one (1) business day by any of the foregoing means, and in
all cases addressed as follows, and such notice shall be deemed to have been
given upon the date of actual receipt or delivery (or refusal to accept
delivery) at the address specified below (or such other addresses as may be
specified by notice in the foregoing manner) as indicated on the return receipt
or air bill:

   

 

If to Landlord:  

   

Santa Clara Office Partners LLC

   

   

c/o Menlo Equities LLC

   

   

490 California Avenue

   

   

4th Floor

   

   

Palo Alto, California 94306

   

   

Attention: Henry Bullock/Richard Holmstrom

   

   

Facsimile: (650) 326-9333

   

   

   

   

   

   

   

   

   

with a copy to:

   

Mintz Levin Cohn Ferris Glovsky and Popeo PC

   

   

44 Montgomery Street

   

   

36th Floor

   

   

San Francisco, California 94104

   

   

Paul Churchill

   

   

Attention: Paul Churchill

   

   

Facsimile: (415) 432-6001

   

   

   

   

   

   

If to Tenant:

   

Palo Alto Networks, Inc.

   

   

3300 Olcott Street

   

   

Santa Clara, California 95054

   

   

Attention: Michael Lehman

   

   

Facsimile: (408) 753-4001

   

Any notice given in accordance with the foregoing shall be deemed received upon
actual receipt or refusal to accept delivery.  Any notice required by statute
and not waived in this Lease shall be given and deemed received in accordance
with the applicable statute or as otherwise provided by law.

6.  Options to Extend.  Upon satisfaction or written waiver by Landlord of the
foregoing conditions, Landlord and Tenant agree that Tenant shall no longer have
any options to extend the Term of the Lease and that the Lease is hereby amended
by deleting Article 15, effective upon such satisfaction or written waiver by
Landlord of the foregoing conditions.

7.  Additional Condition Precedent To Lease Amendment.  The effectiveness of
this Amendment and Landlord’s and Tenant’s obligations hereunder are subject to
the receipt by Landlord, no later than ten (10) business days after the date
hereof, of the Lender’s Consent.  Landlord hereby agrees to use diligent efforts
to obtain the Lender’s Consent by such date; however, if Landlord does not
receive the Lender’s Consent

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by such date, this Amendment shall, at either Landlord’s or Tenant’s option by
written notice to the other party delivered prior to receipt of Lender’s Consent
(if received after such 10-business-day period), thereupon be deemed terminated
and of no further force or effect, and neither party shall have any further
rights, obligations, or liabilities hereunder.  As used herein, the term
“Lender’s Consent” means a written consent to this Amendment in form reasonably
satisfactory to Landlord and Tenant, executed by the holder of the promissory
note secured by that certain Construction Deed of Trust, Assignment of Rents and
Leases, Security Agreement and Fixture Filing (encumbering the fee interest in
the real property of which the Leased Premises are a part), recorded on April 9,
2008 in the Official Records of Santa Clara, California, at Series No. 19806764,
as amended.

8.  Option Term Lease; Restoration of Certain Alterations.

A.  In the Consent to Sublease, Landlord has granted Subtenant the option to
lease the Leased Premises directly from Landlord pursuant to the Option Term
Lease (as defined in the Consent to Sublease) at the expiration of the Term of
the Lease.  In the event that Subtenant exercises such option and becomes a
direct tenant of Landlord’s pursuant to the Option Term Lease, or in the event
Landlord, in its sole and absolute discretion, agrees to enter into a different
form of direct lease with Subtenant for the entirety of the Leased Premises
commencing concurrently with the expiration of the Lease (an “Alternative Direct
Lease”), Landlord agrees that (i) Tenant shall be excused from the removal and
restoration and other surrender obligations set forth in Paragraph 2.6 of the
Lease and (ii) such obligations shall be deferred to the expiration or earlier
termination of the Option Term Lease or the Alternative Direct Lease, as
applicable, in both cases (i) and (ii), if but only to the extent that Subtenant
has assumed such obligations in accordance with Section 3 of the Consent to
Sublease.  Tenant acknowledges and agrees that Landlord shall have no obligation
to enter into the Alternative Direct Lease, and may refuse to do so for any
reason or no reason.

B.  Landlord agrees that, notwithstanding Section 8(a) above, Article 6 of the
Lease, and the four (4) letters attached to this Amendment as Exhibit C (the
“Alteration Approval Letters”), Landlord will not require Tenant or Subtenant to
remove the Alterations which were the subject of the Alteration Approval
Letters.

9.  Brokers.  Tenant represents, warrants and agrees that it has not had any
dealings with any real estate broker(s), leasing agent(s), finder(s) or
salesmen, other than Cooper/Brady Partnership dba Cresa (“Cresa”) with respect
to the Sublease, and that it will indemnify, defend with competent counsel
approved by Landlord, and hold Landlord harmless from any liability for the
payment of any real estate brokerage commissions, leasing commissions or
finder’s fees claimed by any other real estate broker(s), leasing agent(s),
finder(s), or salesmen to be earned or due and payable by reason of Tenant’s
agreement or promise (implied or otherwise) to pay (or to have Landlord pay)
such a commission or finder’s fee by reason of the Sublease.  In reliance on the
foregoing, Landlord shall pay a leasing commission to Cresa on account of this
Lease Amendment and the Sublease in the aggregate amount of $919,325 pursuant
to, in accordance with, and subject to the conditions contained in, a separate
written agreement signed by Landlord and Cresa.

A.  Successors and Assigns.  This Amendment shall be binding upon any and all of
the administrators, executors, successors, trustors, beneficiaries and assigns
of each of the parties without regard to the time at which said persons first
assumed such status.  Landlord’s interest in this Amendment shall be freely
assignable by Landlord in its sole discretion.

B.  Multiple Counterparts.  This Amendment may be executed in multiple
counterparts, each of which shall constitute an original.  The parties
contemplate that the executed counterparts of this Amendment may be transmitted
by facsimile and agree and intend that a signature sent by facsimile machine
shall bind the party so signing with the same effect as though the signature
were an original signature.

C.  Advice of Counsel.  The parties acknowledge that they have been represented
in the negotiations for and in the performance of this Amendment by counsel of
their own choice; that they have read this Amendment; that they have had this
Amendment fully explained to them by such counsel or have had such opportunity;
and that they are fully aware of the contents of this Amendment and of its legal
effect.

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D.  Attorneys’ Fees.  In the event of any dispute, claim or litigation based
upon, arising out of, or relating to, the breach or enforcement of any of the
provisions of this Amendment, the prevailing party in such dispute, claim or
litigation shall be entitled to recover attorneys’ fees, costs and expenses from
the non-prevailing party.

E.  Choice of Law.  This Amendment shall be construed and enforced in accordance
with California law.

F.  Construction.  The Amendment shall not be construed as if drafted by only
one party, but shall be construed as if drafted by both parties.

G.  Authority.  Each party represents to the other that it has the right to
enter into this Amendment, and that it is not violating the terms or conditions
of any other agreement to which it is a party or by which it is bound by
entering into this Amendment.  It is further represented and agreed that the
individuals signing this Amendment on behalf of the respective parties do have
actual authority to execute this Amendment and, by doing so, bind the party on
whose behalf this Amendment has been signed.

   

   

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IN WITNESS WHEREOF, the parties have executed this Amendment effective as of the
date first set forth above.

   

 

LANDLORD:

   

Santa Clara Office Partners LLC,

a Delaware limited liability company

   

   

   

   

   

By:

Menlo Equities III LLC,

   

a California limited liability company,

   

its Managing Member

   

   

   

   

   

   

By:

Menlo Equities LLC,

   

   

a California limited liability company,

   

   

its Managing Member

   

   

   

   

   

   

   

By:

Diamant Investments LLC,

   

   

   

a Delaware limited liability company,

   

   

   

its Member

   

   

   

   

   

   

   

   

By:

   

   

   

   

   

   

Rick Holmstrom, Manager

   

   

   

   

   

   

   

   

   

   

TENANT:

   

   

   

   

   

Palo Alto Networks, Inc., a

Delaware corporation

   

By:

   

   

Its:

President

   

   

   

   

   

   

   

   

   

   

By:

   

   

Its:

Chief Financial Officer

   

   

   

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EXHIBIT E

DESCRIPTION OF SUBLESSOR’S INTENDED IMPROVEMENTS

   

1.  Design/build new QA Lab(s) and Hardware Lab(s).

a.  Convert, to Gigamon needs, using the existing lab(s) space on the 1st and
2nd floor . 

b.  General Requirements

i.  Perform a structural engineering evaluation of the second floor labs

ii.  Apply an equipment layout plan for analysis to the structural engineering
floor loan specifications

c.  1st and 2nd floor

i.  Evaluate the existing HVAC capacity, performance

ii.  Add secondary CRAC, Roof or server cabinet HVAC capacity

iii.  Electrical and Data as needed

2.  Possible improvements to IT Server Room

3.  Cubicle / Office / Conference / Executive Briefing Center

a.  Potential for expansion / contraction

   

   

   

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