Exhibit 10.26

 

STANDARD INDUSTRIAL/COMMERCIAL MULTI-TENANT LEASE - NET

 

1.                                      Basic Provisions (“Basic Provisions”)

 

1.1                                 Parties: This Lease (“Lease”), dated for
reference purposes only July 28, 2009, is made by and between New Hampshire
Apartments, Inc. (“Lessor”) and Wilshire State Bank (“Lessee”).

 

1..2(a)                Premises: That certain portion of the project (as defined
below), including all improvements thereon or to be provided by Lessor under the
terms of this Lease, commonly known by the street address of 2424 Sepulveda
Blvd., located in the City of Torrance, County of Los Angeles, State of CA, with
zip code 90501, as outlined on Exhibit         attached hereto (“Premises”) and
generally described as (describe briefly the nature of the Premises):
Approximately 2,360Square Feet.

 

In addition to Lessee’s rights to use and occupy the Premises as hereinafter
specified, Lessee shall have non-exclusive rights to the Common Areas (as
defined in Paragraph 2.7 below) as hereinafter specified, but shall not have any
rights to the roof, exterior walls or utility raceways of the building
containing the Premises (“Building”) or to any other buildings in the Project.
The Premises, the Building, the Common Areas, the land upon which they are
located, along with all other buildings and improvements thereon, are herein
collectively referred to as the “Project”. (See also Paragraph 2).

 

1.2(b)                  Parking: The use of Unreserved Parking Spaces for
Lessee’s employees, agents and guests, plus six (6) Reserved Parking Spaces
located at the front entrance to the Premises. (See also Paragraph 2.6)

 

1.3                                 Term: Ten (10) years and Zero (0) months
(“Original Term”) commencing July 1, 2009 (“Commencement Date”) and ending
June 30, 2019.

 

1.4                                 Early Possession: None

 

1.5                                 Base Rent: $2.29 per Square Foot (“Base
Rent”), payable on the First (1st) day of each month commencing July 1, 2009.
(See also Paragraph 4).

 

x If this box is checked, there are provisions in this Lease for the Base Rent
to be adjusted.

 

1.6                                 Lessee’s Share of Common Area Operating
Expenses: Lessee’s Proportionate Share (“Lessee’s Share”).

 

1.7                                 Base Rent and Other Monies Paid Upon
Execution:

 

(a)  Base Rent: $5,415.85 for the period 7/1/2009-6/30/2019.

(b)  Common Area Operating Expenses: CAM Charge will be additionally included
every month Your prorated share is 12.66%.

(c)  Security Deposit: $10,831.70 (“Security Deposit”). (See also Paragraph 5)

(d)  Other: 3% Annual Increase.

(e)  Total Due Upon Execution of this Lease: $17,465.55 $

 

1.8                                 Agreed Use: Retail banking and general
office (See also Paragraph 6)

 

1.9                                 Insuring Party: Lessor is the “Insuring
Party.” (See also Paragraph 8)

 

1.10                           Real Estate Broker: (See also Paragraph 15)

 

(a)  Representation: The following real estate brokers (the Brokers) and
brokerage relationship exists in this transaction:

Listing Agent: PRG Investment

Selling Agent: Trans-Western

Commission: Commission will be paid to Trans-Western in the amount of
$4,000.00 & PRD Investment, Inc. in the amount of $2,000.00 by the landlord upon
lease executed by both parties.

 

2.

 

2.1                                 Letting. Lessor hereby leases to Lessee, and
Lessee hereby leases from Lessor, the Premises, for the term, at the rental, and
upon all of the terms, covenants and conditions set forth in this

 

Torrance Branch Lease Agreement

2424 Sepulveda Blvd., Torrance (July 2009)

 

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Lease. Unless otherwise provided herein, any statement of size set forth in this
Lease, or that may have been used in calculating Rent, is an approximation which
the Parties agree is reasonable and any payments based thereon are not subject
to revision whether or not the actual size is more or less.

 

2.2                                 Condition. Lessor shall deliver that portion
of the Premises contained within the Building (“Unit”) to Lessee broom clean and
free of debris on the Commencement Date or the Early Possession Date, whichever
first occurs (“Start Date”), and, so long as the required service contracts
described in Paragraph 7.1(b) below are obtained by Lessee and in effect within
thirty days following the Start Date, warrants that the existing electrical,
plumbing, fire sprinkler, lighting, heating, ventilating and air conditioning
systems (“HVAC”), loading doors, if any, and all other such elements in the
Unit, other than those constructed by Lessee, shall be in good operating
condition on said date and that the roof, bearing walls and foundation of the
Unit shall be in good condition and free of material defects. If a
non-compliance with such warrant exists as of the Start Date, or if one of such
systems or elements should malfunction or fail within the appropriate warranty
period, Lessor shall, as Lessor’s sole obligation with respect to such matter,
except as otherwise provided in this Lease, promptly after receipt of written
notice from Lessee setting forth with specificity the nature and extent of such
non-compliance, malfunction or failure, rectify same at Lessor’s expense. The
warranty periods shall be as follows: (i) six months as to the HVAC systems,
(ii) 30 days as to the remaining systems and other elements of the Unit and
(iii) unlimited as to the roof, bearing walls and foundation of the Unit. If
Lessee does not give Lessor the required notice within the appropriate warranty
period, correction of any such non-compliance, malfunction or failure shall be
the obligation of Lessee at Lessee’s sole cost and expense (except for the
repairs to the fire sprinkler systems, roof, foundations, and/or bearing walls
see Paragraph 7).

 

2.3                                 Compliance. Lessor warrants that the
improvements on the Premises and the Common Areas comply with the building codes
that were in effect at the time that each such improvement, or portion thereof,
was constructed, and also with all applicable laws, covenants or restrictions of
record, regulations, and ordinances in effect on the Start Date (“Applicable
Requirements”). Said warranty does not apply to the use to which Lessee will put
the Premises or to any Alterations or Utility Installations (as defined in
Paragraph 7.3(a)) made or to be made by Lessee. NOTE: Lessee is responsible for
determining whether or not the Applicable Requirements, and especially the
zoning, are appropriate for Lessee’s intended use, and acknowledges that past
uses of the Premises may no longer be allowed. If the Premises do not comply
with said warranty, Lessor shall, except as otherwise provided, promptly after
receipt of written notice from Lessee setting forth with specificity the nature
and extent of such non-compliance, rectify the same at Lessor’s expense. If
Lessee does not give Lessor written notice of a non-compliance with this
warranty within 6 months following the Start Date, correction of that
non-compliance shall be the obligation of Lessee at Lessee’s sole cost and
expense. If the Applicable Requirements are hereafter changed so as to require
during the term of this Lease the construction of an addition to or an
alteration of the Unit, Premises and/or Building, the remediation of any
Hazardous Substance, or the reinforcement or other physical modification of the
Unit, Premises and/or Building (“Capital Expenditure”), Lessor and Lessee shall
allocate the cost of such work as follows:

 

(a) Subject to Paragraph 2.3(c) below, if such Capital Expenditures are required
as a result of the specific and unique use of the Premises by Lessee as compared
with uses by tenants in general, Lessee shall be fully responsible for the cost
thereof, provided, however that if such Capital Expenditure is required during
the last 2 years of this Lease and the cost thereof exceeds 6 months. Base Rent,
Lessee may instead terminate this Lease unless Lessor notifies Lessee, in
writing, within 10 days after receipt of Lessee’s termination notice that Lessor
has elected to pay the difference between the actual cost thereof and the amount
equal to 6 months Base Rent. If Lessee elects termination, Lessee shall deliver
to Lessor written notice specifying a termination date at least 90 days
thereafter. Such termination date shall, however, in no event be earlier than
the last day that Lessee could legally utilize the Premises without commencing
such Capital Expenditure.

 

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(b) If such Capital Expenditure is not the result of the specific and unique use
of the Premises by Lessee (such as, governmentally mandated seismic
modifications), then Lessor and Lessee shall allocate the obligation to pay for
the portion of such costs reasonably attributable to the Premises pursuant to
the formula set out in Paragraph 7.1(d) provided, however, that if such Capital
Expenditure is required during the last 2 years of this Lease or either Lessor
or Lessee reasonably determines that it is not economically feasible to pay its
share thereof, such party shall have the option to terminate this Lease upon 90
days prior written notice to the other party unless the non-terminating party
notifies the terminating party, in writing, within 10 days after receipt of the
termination notice that the non-terminating party will pay for such Capital
Expenditure. If Lessor does not elect to terminate, and fails to tender its
share of any such Capital Expenditure, Lessee may advance such funds mid deduct
same, with Interest, from Rent until Lessor’s share of such costs have been
fully paid. If Lessee is unable to finance Lessor’s share, or if the balance of
the Rent due and payable for the remainder of this Lease is not sufficient to
fully reimburse Lessee on an offset basis, Lessee shall have the right to
terminate this Lease upon 30 days written notice to Lessor.

 

(c) Notwithstanding the above, the provisions concerning Capital Expenditures
are intended to apply only to non-voluntary, unexpected, and new Applicable
Requirements. If the Capital Expenditures are instead triggered by Lessee as a
result of an actual or proposed change in use, change in intensity of use, or
modification to the Premises then, and in that event, Lessee shall be fully
responsible for the cost thereof, and Lessee shall not have any right to
terminate this Lease.

 

2.4                                 Acknowledgments. Lessee acknowledges that:
(a) it has been advised by Lessor and/or Brokers to satisfy itself with respect
to the condition of the Premises (including but not limited to the electrical,
HVAC and fire sprinkler systems, security, environmental aspects, and compliance
with Applicable Requirements and the Americans with Disabilities Act), and their
suitability for Lessee’s intended use, (b) Lessee has made such investigation as
it deems necessary with reference to such matters and assumes all responsibility
therefor as the same relate to its occupancy of the Premises, and (c) neither
Lessor, Lessor’s agents, nor Brokers have made any oral or written
representations or warranties with respect to said makers other than as set
forth in this Lease; it being understood that Lessee has not conducted an
environmental audit or an analysis of compliance with the ADA, and that Lessee
has relied on the representations of Lessor with regard to these and other
matters covered by Lessor’s representations in this Lease, to wit: the warranty
set forth in Section 2.3 above. In addition, Lessor acknowledges that:
(i) Brokers have made no representations, promises or warranties concerning
Lessee’s ability to honor the Lease or suitability to occupy the Premises, and
(ii) it is Lessor’s sole responsibility to investigate the financial capability
and/or suitability of all proposed tenants.

 

2.5                                 Lessee as Prior Owner/Occupant. The
warranties made by Lessor in Paragraph 2 shall be of no force or effect if
immediately prior to the Start Date Lessee was the owner or occupant of the
Premises. In such event, Lessee shall be responsible for any necessary
corrective work.

 

2.6                                 Vehicle Parking. Lessee shall be entitled to
use the number of Unreserved Parking Spaces and Reserved Parking Spaces
specified in Paragraph 1.2(b) on those portions of the Common Areas designated
from time to time by Lessor for parking. Lessee shall not use more parking
spaces than said number. Said parking spaces shall be used for parking by
vehicles no larger than full-size passenger automobiles or pick-up trucks,
herein called “Permitted Size Vehicles.” Lessor may regulate the loading and
unloading of vehicles by adopting Rules and Regulations as provided in Paragraph
2.9. No vehicles other than Permitted Size Vehicles may be parked in the Common
Area without the prior written permission of Lessor.

 

(a) Lessee shall not permit or allow any vehicles that belong to or are
controlled by Lessee or Lessee’s employees, suppliers, shippers, customers,
contractors or invitees to be loaded, unloaded, or parked in areas other than
those designated by Lessor for such activities.

 

(b) Lessee shall not service or store any vehicles in the Common Areas.

 

(c) If Lessee permits or allows any of the prohibited activities described in
this Paragraph 2.6, then Lessor shall have the right, without notice, in
addition to such other rights and remedies that it may

 

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have, to remove or tow away the vehicle involved and charge the cost to Lessee,
which cost shall be immediately payable upon demand by Lessor.

 

(d) In the event that Lessor begins charging visitors for parking, Lessor shall
provide one hour free parking to Lessee’s customers and visitors at no charge to
Lessee.

 

2.7                                 Common Areas - Definition. The term “Common
Areas” is defined as all areas and facilities outside the Premises and within
the exterior boundary line of the Project and interior utility raceways and
installations within the Unit that are provided and designated by the Lessor
from time to time for the general non-exclusive use of Lessor, Lessee and other
tenants of the Project and their respective employees, suppliers, shippers,
customers, contractors and invitees, including parking areas, loading and
unloading areas, trash areas, roadways, walkways, driveways and landscaped
areas.

 

2.8                                 Common Areas - Lessee’s Rights. Lessor
grants to Lessee, for the benefit of Lessee and its employees, suppliers,
shippers, contractors, customers and invitees, during the term of this Lease,
the non-exclusive right to use, in common with others entitled to such use, the
Common Areas as they exist from time to time, subject to any rights, powers, and
privileges reserved by Lessor under the terms hereof or under the terms of any
rules and regulations or restrictions governing the use of the Project. Under no
circumstances shall the right herein granted to use the Common Areas be deemed
to include the right to store any property, temporarily or permanently, in the
Common Areas, Any such storage shall be permitted only by the prior written
consent of Lessor or Lessor’s designated agent, which consent may be revoked at
any time. In the event that any unauthorized storage shall occur then Lessor
shall have the right, without notice, in addition to such other rights and
remedies that it may have, to remove the property and charge the cost to Lessee,
which cost shall be immediately payable upon demand by Lessor.

 

2.9                                 Common Areas - Rules and Regulations. Lessor
or such other person(s) as Lessor may appoint shall have the exclusive control
and management of the Common Areas and shall have the right, from time to time,
to establish, modify, amend and enforce reasonable rules and regulations
(“Rules and Regulations”) for the management, safety, care, and cleanliness of
the grounds, the parking and unloading of vehicles and the preservation of good
order, as well as for the convenience of other occupants or tenants of the
Building and the Project and their invitees. Lessee agrees to abide by and
conform to all such Rules and Regulations, and to cause its employees,
suppliers, shippers, customers contractors and invitees to so abide and conform.
Lessor shall not be responsible to Lessee for the non-compliance with said
Rules and Regulations by other tenants of the Project.

 

2.10                           Common Areas - Changes. Lessor shall have the
right, in Lessor’s sole discretion, from time to time:

 

(a) To make changes to the Common Areas including, without limitation, changes
in the location, size, shape and number of driveways, entrances, parking spaces,
parking areas, loading and unloading areas, ingress, egress, direction of
traffic, landscaped areas, walkways and utility raceways;

 

(b) The close temporarily any of the Common Areas for maintenance purposes so
long as reasonable access to the Premises remains available;

 

(c) To designate other land outside the boundaries of the Project to be a part
of the Common Areas;

 

(d) To add additional buildings and improvements to the Common Areas;

 

(e) To use the Common Areas while engaged in making additional improvements,
repairs or alterations to the Project, or any portion thereof; and

 

(f) To do and perform such other acts and make such other changes in, to or with
respect to the Common Areas and Project as Lessor may, in the exercise of sound
business judgment, deem to be appropriate.

 

3.                                       Term.

 

3.1                                 Term. The Commencement Date, Expiration Date
and Original Term of this Lease are as specified in Paragraph 1.3.

 

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3.2                                 Early Possession. If Lessee totally or
partially occupies the Premises prior to the Commencement Date, the obligation
the pay Base Rent shall be abated for the period of such early possession. All
other terms of this Lease (including but not limited to the obligation to pay
Lessor’s Share of Common Area Operating Expenses, Real Property Taxes and
insurance premiums and to maintain the Premises) shall, however, be in effect
during such period. Any such early possession shall not affect the Expiration
Date.

 

3.3                                 Delay in Possession. Lessor agrees to use
its best commercially reasonable efforts to deliver possession of the Premises
to Lessee by the Commencement Date. If, despite said efforts, Lessor is unable
to deliver possession as agreed, Lessor shall not be subject to any liability
therefor, nor shall such failure affect the validity of this Lease, Lessee shall
not, however, be obligated to pay Rent or perform its other obligations until it
receives possession of the Premises. If possession is not delivered within 60
days after the Commencement Date, Lessee may, at its option, by notice in
writing within 10 days after the end of such 60 day period, cancel this Lease,
in which event the Parties shall be discharged from all obligations hereunder.
If such written notice is not received by Lessor within said 10 day period.
Lessee’s right to cancel shall terminate. Except as otherwise provided, if
possession is not tendered to Lessee by the Start Date and Lessee does not
terminate this Lease, as aforesaid, any period of rent abatement that Lessee
would otherwise have enjoyed shall run from the date of delivery of possession
and continue for a period equal to what Lessee would otherwise have enjoyed
under the terms hereof, but minus any days of delay caused by the acts or
omissions of Lessee. If possession of the Premises is not delivered within 4
months after the Commencement Date, this Lease shall terminate unless other
agreements are reached between Lesser and Lessee, in writing.

 

3.4                                 Lessee Compliance. Lessor shall not be
required to tender possession of the Premises to Lessee until Lessee complies
with its obligation to provide evidence of insurance (Paragraph 8.5). Pending
delivery of such evidence, Lessee shall be required to perform all of its
obligations under this Lease from and after the Start Date, including the
payment of Rent, notwithstanding Lessor’s election to withhold possession
pending receipt of such evidence of insurance. Further, if Lessee is required to
perform any other conditions prior to or concurrent with the Start Date, the
Start Date shall occur but Lessor may elect to withhold possession until such
conditions are satisfied.

 

4.                                       Rent.

 

4.1                                 Rent Defined. All monetary obligations of
Lessee to Lessor under the terms of this Lease (except for the Security Deposit)
are deemed to be rent {“Rent”).

 

4.2                                 Common Area Operating Expenses. Lessee shall
pay to Lessor during the term hereof, in addition to the Base Rent, Lessee’s
Share (as specified in Paragraph 1.6) of all Common Area Operating Expenses, as
hereinafter defined, during each calendar year of the term of this Lease, in
accordance with the following provisions:

 

(a) “Common Area Operating Expenses” are defined, for purposes of this Lease, as
all costs incurred by Lessor relating to the ownership and operation of the
Project, including, but not limited to, the following:

 

(i) The operation, repair and maintenance, in neat, clean, good order and
condition of the following:

 

(aa) The Common Areas and Common Area improvements, including parking areas,
loading and unloading areas, trash areas, roadways, parkways, walkways,
driveways, landscaped areas, bumpers, irrigation systems, Common Area lighting
facilities, fences and gates, elevators, roofs, and roof drainage systems.

 

(bb) Exterior signs and any tenant directories.

 

(cc) Any fire detection and/or sprinkler systems.

 

(ii) The cost of water, gas, electricity and telephone to service the Common
Areas and any utilities not separately metered.

 

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(iii) Trash disposal, pest control services, property management, security
services, and the costs of any environmental inspections.

 

(iv) Reserves set aside for maintenance and repair of Common Areas.

 

(v) Real Property Taxes (as defined in Paragraph 10).

 

(vi) The cost of the premiums for the insurance maintained by Lessor pursuant to
Paragraph 8.

 

(vii) Any deductible portion of an insured loss concerning the Building or the
Common Areas.

 

(viii) The cost of any Capital Expenditure to the Building or the Project not
covered under the provisions of Paragraph 2.3 provided; however, that Lessor
shall allocate the cost of any such Capital Expenditure over a 12 year period
and Lessee shall not be required to pay more than Lessee’s Share of 1/144th of
the cost of such Capital Expenditure in any given month.

 

(ix) Any other services to be provided by Lessor that are stated elsewhere in
this Lease to be a Common Area Operating Expense.

 

(b) Any Common Area Operating Expenses and Real Property Taxes that are
specifically attributable to the Unit, the Building or to any other building in
the Project or to the operation, repair and maintenance thereof, shall be
allocated entirely to such Unit, Building, or other building. However, any
Common Area Operating Expenses and Real Property Taxes that are not specifically
attributable to the Building or to any other building or to the operation,
repair and maintenance thereof, shall be equitably allocated by Lessor to all
buildings in the Project.

 

(c) The inclusion of the improvements, facilities and services set forth in
Subparagraph 4.2(a) shall not be deemed to impose an obligation upon Lessor to
either have said improvements or facilities or to provide those services unless
the Project already has the same, Lessor already provides the services, or
Lessor has agreed elsewhere in this Lease to provide the same or some of them.

 

(d) Lessee’s Share of Common Area Operating Expenses may be estimated by Lessor
from time to time of Lessee’s Share of annual Common Area Operating Expenses and
the same shall be payable monthly during each 12 month period of the Lease term,
on the same day as the Base Rent is due hereunder. Lessor shall deliver to
Lessee within 60 days after the expiration of each calendar year a reasonably
detailed statement showing Lessee’s Share of the actual Common Area Operating
Expenses incurred during the preceding year. If Lessee’s payments under this
Paragraph 4.2(d) during the preceding year exceed Lessee’s Share as indicated on
such statement, Lessor shall credit the amount of such over-payment against
Lessee’s Share of Common Area Operating Expenses next becoming due. If Lessee’s
payments under this Paragraph 4.2(d) during the preceding year were less than
Lessee’s Share as indicated on such statement, Lessee shall pay to Lessor the
amount of the deficiency within 10 days after delivery by Lessor to Lessee of
the statement.

 

(e) In determining Lessee’s Share of the Common Area Operating Expenses, all
expense categories shall be adjusted to one hundred percent (100%) project
occupancy, and there shall be a five percent (5%) annual cap on all landlord
controlled expenses.

 

(f) Lessee shall have the right to conduct an audit, at its own expense, of the
determination of the Common Area Operating Expenses and Lessee’s Share thereof.
Lessor agrees to make available its books and records and its employees, upon
reasonable prior notice, to Lessee and its agents. To the extent that the audit
reveals that Lessee’s Share of Common Operating Expenses is less than that
actually paid by Lessee, Lessor shall return the excess amount paid, within 10
days of receipt by Lessor of the results of the audit.

 

(g) Lessor shall provide to Lessee on or before the date of execution of the
Lease a line item breakdown of 2009 operating expense projections and 2008
actual operating expenses.

 

(h) In the event that real estate taxes are increased due to a sale, change in
ownership, or reassessment of the Project, during the first five (5) years of
the Lease Term, any such increase shall be excluded from the Common Area
Operating Expenses.

 

4.3                                 Payment Lessee shall cause payment of Rent
to be received by Lessor in lawful money of the United States, without offset or
deduction (except as specifically permitted in this Lease), on or before the day
on which it is due. Rent for any period during the term hereof which is for less
than one full calendar month shall be prorated based upon the actual number of
days of said month.

 

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Payment of Rent shall be made to Lessor at its address stated herein or to such
other persons or place as Lessor may from time to time designate in writing.
Acceptance of a payment which is less than the amount then due shall not be a
waiver of Lessor’s rights to the balance of such Rent, regardless of Lessor’s
endorsement of any check so stating. In the event that any check, draft, or
other instrument of payment given by Lessee to Lessor is dishonored for any
reason, Lessee agrees to pay to Lessor the sum of $25 in addition to any late
charges which may be due.

 

5.                                       Security Deposit. Lessee shall deposit
with Lessor upon execution hereof the Security Deposit as security for Lessee’s
faithful performance of its obligations under this Lease. If Lessee fails to pay
Rent, or otherwise Defaults under this Lease, Lessor may use, apply or retain
all or any portion of said Security Deposit for the payment of any amount due
Lessor or to reimburse or compensate Lessor for any liability, expense, loss or
damage which Lessor may suffer or incur by reason thereof. If Lessor uses or
applies all or any portion of the Security Deposit, Lessee shall within 10 days
after written request therefor, along with a statement setting forth in
reasonable detail an accounting for the portion so applied, deposit monies with
Lessor sufficient to restore said Security Deposit to the full amount required
by this Lease. If the Base Rent increases during the term of this Lease, Lessee
shall, upon written request from Lessor, deposit additional monies with Lesser
so that the total amount of the Security Deposit shall at all times bear the
same proportion to the increased Base Rent as the initial Security Deposit bore
to the initial Base Rent. Should the Agreed Use be amended to accommodate a
material, change in the business of Lessee or to accommodate a sublessee or
assignee, Lessor shall have the right to increase the Security Deposit to the
extent necessary, in Lessor’s reasonable judgment, to account for any increased
wear and tear that the Premises may suffer as a result thereof. Lessor shall not
be required to keep the Security Deposit separate from its general accounts.
Within 14 days after the expiration or termination of this Lease, if Lessor
elects to apply the Security Deposit only to unpaid Rent, and otherwise within
30 days after the Premises have been vacated pursuant to Paragraph 7.4(c) below,
Lessor shall return that portion of the Security Deposit not used or applied by
Lessor. No part of the Security Deposit shall be considered to be held in trust,
to bear interest or to be prepayment for any monies to be paid by Lessee under
this Lease.

 

6.                                       Use.

 

6.1                                 Use. (a) Lessee shall use and occupy the
Premises only for the Agreed Use, or any other legal use which is reasonably
comparable thereto, and for no other purpose. Lessee shall not use or permit the
use of the Premises in a manner that is unlawful, creates damage, waste or a
nuisance, or that disturbs occupants of or causes damage to neighboring premises
or properties. Lessor shall not unreasonably withhold or delay its consent to
any written request for a modification of the Agreed Use, so long as the same
will not impair the structural integrity of the improvements on the Premises or
the mechanical or electrical systems therein, and/or is not significantly more
burdensome to the Premises. If Lessor elects to withhold consent, Lessor shall
within 7 days after such request give written notification of same, which notice
shall include an explanation of Lessor’s objections to the change in the Agreed
Use.

 

(b) Lessor agrees that no other portion of the Project shall be used or operated
for retail banking for the term of this Lease and any extensions. Banking
services include, without limitation, making-loans, accepting deposits, cashing
checks, safe deposit boxes, issuance of letters of credit, cash management, ATMs
and other services customarily associated with retail banks.

 

(c) At no additional charge, Lessee shall have the right to install an
externally accessible ATM and deposit box.

 

6.2                                 Hazardous Substances.

 

(a) Reportable Uses Require Consent. The term “Hazardous Substance” as used in
this Lease shall mean any product, substance, or waste whose presence, use,
manufacture, disposal, transportation, or release, either by itself or in
combination with other materials expected to be on the Premises, is either:
(i) potentially injurious to the public health, safety or welfare, the
environment or the

 

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Premises, (ii) regulated or, prepared by any governmental authority, or (iii) a
basis for potential liability of Lessor to any governmental agency or third
party under any applicable state common law theory. Hazardous Substances shall
include, but not be limited to, hydrocarbons, petroleum, gasoline, and/or crude
oil or any products, by-products or fractions thereof. Lessee shall not engage
in any activity in or on the Premises which constitutes a Reportable Use of
Hazardous Substances without the express prior written consent of Lessor and
timely compliance (at Lessee’s expense) with all Applicable Requirements.
“Reportable Use” shall mean (i) the installation or use of any above or below
ground storage tank, (ii) the generation, possession, storage, use,
transportation, or disposal of a Hazardous Substance that requires a permit
from, or with respect to which a report, notice, registration or business plan
is required to be filed with, any governmental authority, and/or (iii) the
presence at the Premises of a Hazardous Substance with respect to which any
Applicable Requirements requires that a notice be given to persons entering or
occupying the Premises or neighboring properties. Notwithstanding the foregoing,
Lessee may use any ordinary and customary materials reasonable required to be
used in the normal course of the Agreed Use, so long as such use is in
compliance with all Applicable Requirements, is not a Reportable Use, and does
not expose the Premises or neighboring property to any meaningful risk of
contamination or damage or expose Lessor to any liability therefor. In addition,
Lessor may condition its consent to any Reportable Use upon receiving such
additional assurances as Lessor reasonably deems necessary to protect itself,
the public, the Premises and/or the environment against damage, contamination,
injury and/or liability, including, but not limited to, the installation (and
removal on or before Lease expiration or termination) of protective
modifications (such as concrete encasements) and/or increasing the Security
Deposit.

 

(b) Duty to Inform. If a responsible officer of either party hereto knows, or
has reasonable cause to believe, that a Hazardous Substance has come to be
located in, on, under or about the Premises, such party shall immediately give
written notice of such fact to the other party, and provide such other party
with a copy of any report, notice, claim or other documentation which it has
concerning the presence of such Hazardous Substance.

 

(c) Lessee Remediation. Lessee shall not cause or permit any Hazardous Substance
to be spilled or released in, on, under, or about the Premises (including
through the plumbing or sanitary sewer system) and shall promptly, at Lessee’s
expense, take all investigatory and/or remedial action reasonably recommended,
whether or not formally ordered or required, for the cleanup of any
contamination of, and for the maintenance, security and/or monitoring of the
Premises or neighboring properties, that was caused or to the extent that it was
materially contributed to by Lessee, or pertaining to or involving any Hazardous
Substance brought onto the Premises during the term of this Lease, by Lessee, or
any third party acting at the direction of Lessee.

 

(d) Lessee Indemnification. Lessee shall indemnify, defend and hold Lessor, its
agents, employees, lenders and ground lessor, if any, harmless from and against
any and all loss of rents and/or damages, liabilities, judgments, claims,
expenses, penalties, and reasonable out-of-pocket attorneys’ and consultants’
fees arising out of or involving any Hazardous Substance brought onto the
Premises by Lessee, or any third party acting at the direction of Lessee
(provided, however, that Lessee shall have no liability under this Lease with
respect to underground migration of any Hazardous Substance under the Premises
from areas outside of the Premises). Lessee’s obligations shall include, but not
be limited to, the effects of any contamination or injury to person, property or
the environment created or suffered by Lessee, and the cost of investigation,
removal, remediation, restoration and/or abatement, and shall survive the
expiration or termination of this Lease. No termination, cancellation or release
agreement entered into by Lessor and Lessee shall release Lessee from its
obligations under this Lease with respect to Hazardous Substances, unless
specifically so agreed by Lessor in writing at the time of such agreement.

 

(e) Lessor Indemnification. Lessor and its successors and assigns shall
indemnify, defend, reimburse and hold Lessee, its agents, employees and lenders,
harmless from and against any and damages, liabilities, judgments, claims,
expenses, penalties, and reasonable out-of-pocket attorneys’ and consultants’
fees including the cost of remediation, arising out of or involving any
Hazardous

 

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Substances on the Premises prior to the Start Date or which arise out of or
involved the gross negligence or willful misconduct of Lessor, its agents or
employees. Lessor’s obligations, as and when required by the Applicable
Requirements, shall include, but not be limited to, the cost of investigation,
removal, remediation, restoration and/or abatement, and shall survive the
expiration or termination of this Lease.

 

(f) Investigations and Remediations. Lessor shall retain the responsibility and
pay for any investigations or remediation measures required by governmental
entities having jurisdiction with respect to the existence of Hazardous
Substances on the Premises prior to the Start Date, unless such remediation
measure is required as a result of Lessee’s use (including “Alterations”, as
defined in paragraph 7.3(a) below) of the Premises, in which event Lessee shall
be responsible for such payment. Lessee shall cooperate fully in any such
activities at the request of Lessor, including allowing Lessor and Lessor’s
agents to have reasonable access to the Premises at reasonable times in order to
carry out Lessor’s investigative and remedial responsibilities; it being
understood that reasonable prior written notice of such access must have been
provided to Lessee and that Lessee shall have the right to have its employee
accompany Lessor and Lessor’s agents.

 

(g) Lessor Termination Option. If a Hazardous Substance Condition (see Paragraph
9.1 (e)) occurs during the term of this Lease, unless Lessee is legally
responsible therefor (in which case Lessee shall make the investigation and
remediation thereof required by the Applicable Requirements and this Lease shall
continue in full force and effect, but subject to Lessor’s rights under
Paragraph 6.2(d) and Paragraph 13), Lessor may, at Lessor’s option, either (i).
Investigate and remediate such Hazardous Substance Condition, if required, as
soon as reasonably possible at Lessor’s expense, in which event this Lease shall
continue in full force and effect, or (ii) if the estimated cost to remediate
such condition exceeds 12 times the then monthly Base Rent or $100,000,
whichever is greater, give written notice to Lessee, within 30 days after
receipt by Lessor of knowledge of the occurrence of such Hazardous Substance
Condition, of Lessor’s desire to terminate this Lease as of the date 60 days
following the date of such notice. In the event Lessor elects to give a
termination notice, Lessee may, within 10 days thereafter, give written notice
to Lessor of Lessee’s commitment to pay the amount by which the cost of the
remediation of such Hazardous Substance Condition exceeds an amount equal to 12
times the then monthly Base Rent or $100,000, whichever is greater. Lessee shall
provide Lessor with said funds or satisfactory assurance thereof within 30 days
following such commitment. In such event, this Lease shall continue in full
force and effect, and Lessor shall proceed to make such remediation as soon as
reasonably possible after the required funds are available. If Lessee does not
give such notice and provide the required funds or assurance thereof within the
time provided, this Lease shall terminate as of the date specified in Lessor’s
notice of termination. In addition, if the time required to complete such
remediation is expected to exceed, or actually does exceed, three months, then
Lessee may terminate the Lease upon written notice to Lessor.

 

6.3                                 Lessee’s Compliance with Applicable
Requirements. Except as otherwise provided in this Lease, Lessee shall, at
Lessee’s sole expense, fully, diligently and in a timely manner, materially
comply with all Applicable Requirements, the requirements of any applicable fire
insurance underwriter or rating bureau, and the recommendations of Lessor’s
engineers and/or consultants which relate in any manner to the Premises, without
regard to whether said requirements are now in effect or become effective after
the Start Date. Lessee shall, within 10 days after receipt of Lessor’s written
request, provide Lessor with copies of all permits and other documents, and
other information evidencing Lessee’s compliance with any Applicable
Requirements specified by Lessor, and shall immediately upon receipt, notify
Lessor in writing (with copies of any documents involved) of any threatened or
actual claim, notice, citation, warning, complaint or report pertaining to or
involving the failure of Lessee or the Premises to comply with any Applicable
Requirements.

 

6.4                                 Inspection; Compliance. Lessor and Lessor’s
“Lender” (as defined in Paragraph 30) and consultants shall have the right to
enter into Premises at any time, in the case of an emergency, and otherwise at
reasonable times, during business hours and upon prior written notice to Lessee
for the purpose of inspecting the condition of the Premises and for verifying
compliance by Lessee with this Lease. Lessee shall have the right to have its
employee accompany Lessor and Lessor’s

 

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agents during any non-emergency inspection. The cost of any such inspections
shall be paid by Lessor, unless a violation of Applicable Requirements, or a
contamination is found to exist or be imminent,. In such case, Lessee shall upon
request reimburse Lessor for the reasonable out-of-pocket cost of such
inspection, so long as such inspection is reasonably related to the violation or
contamination.

 

7.                                       Maintenance; Repairs, Utility
Installations; Trade Fixtures and Alterations.

 

7.1                                 Lessee’s Obligations.

 

(a) In General. Subject to the provisions of Paragraph 2.2 (Condition), 2.3
(Compliance), 6.3: (Lessee’s Compliance with Applicable Requirements), 7.2
(Lessor’s Obligations), 9 (Damage or Destruction), and 14(Condemnation), Lessee
shall, at Lessee’s sole expense, keep the Premises, Utility Installations
(intended for Lessee’s exclusive use, no matter where located), and Alterations
in good order, condition and repair (whether or not the need for such repairs
occurs as a result of Lessee’s use, any prior use, the elements or the age of
such portion of the Premises), including, but not limited to, all equipment or
facilities, such as plumbing, HVAC equipment, electrical, lighting facilities,
boilers, pressure vessels, fixtures, interior walls, interior surfaces of
exterior walls, ceilings, floors, windows, doors, plate glass, and skylights but
excluding any items which are the responsibility of Lessor pursuant to Paragraph
7.2. Lessee, in keeping the Premises in good order, condition and repair, shall
exercise and perform good maintenance practices, specifically including the
procurement and maintenance of the service contracts required by Paragraph
7.1(b) below. Lessee’s obligations shall include restorations, replacements or
renewals when necessary to keep the Premises and all improvements thereon or a
part thereof in good order, condition and state of repair.

 

(b) Service Contracts. Lessee shall, at Lessee’s sole expense, procure and
maintain contracts, with copies to Lessor, in customary form and substance for,
and with contractors specializing and experienced in the maintenance of the
following equipment and improvements, if any, if and when installed on the
Premises: (i) HVAC equipment, (ii) boiler and pressure vessels and
(iii) clarifiers,. However, Lessor reserves the right, upon notice to Lessee, to
procure and maintain any or all of such service contracts, and if Lessor so
elects, Lessee shall reimburse Lessor, upon demand, for the reasonable cost
thereof.

 

(c) Failure to Perform. If Lessee fails to perform Lessee’s obligations under
this Paragraph 7.1, Lessor may enter upon the Premises after 10 days’ prior
written notice to Lessee (except in the case of an emergency, in which case no
notice shall be required), perform such obligations on Lessee’s behalf, and put
the Premises in good order, condition and repair, and Lessee shall promptly
reimburse Lessor for the reasonable cost thereof. Lessee shall have the right to
have its employee accompany Lessor and Lessor’s agents during any such entry to
repair.

 

(d) Replacement. Subject to Lessee’s indemnification of Lessor as set forth in
Paragraph 8.7 below, and without relieving Lessee of liability resulting from
Lessee’s failure to exercise and perform good maintenance practices, if an item
described in Paragraph 7.1(b) cannot be repaired other than at a cost which is
in excess of 50% of the cost of replacing such item, then such item shall be
replaced by Lessor, and the cost thereof shall be prorated between the Parties
and Lessee shall only be obligated to pay, each month during the remainder of
the term of this Lease, on the date on which Base Rent is due, an amount equal
to the product of multiplying the cost of such replacement by a fraction, the
numerator of which is one, and the denominator of which is 144 (i e. l/144th of
the cost per month).

 

7.2                                 Lessor’s Obligations. Subject to the
provisions of Paragraphs 2.2 (Condition), 2.3 (Compliance), 4.2 (Common Area
Operating Expenses), 6 (Use), 7.1 (Lessee’s Obligations), 9 (Damage or
Destruction) and 14 (Condemnation), Lessor, subject to reimbursement pursuant to
Paragraph 4.2, shall keep in good order, condition and repair the foundations,
exterior walls, structural condition of interior bearing walls, exterior roof,
fire sprinkler system, Common Area fire alarm and/or smoke detection systems,
fire hydrants, parking lots, walkways, parkways, driveways, landscaping, fences,
signs and utility systems serving the Common Areas and all parts thereof, as
well as providing the services for which there is a Common Area Operating
Expense pursuant to Paragraph 4.2. Lessor shall not be obligated to paint the
exterior or interior surfaces of exterior walls nor shall Lessor be obligated to
maintain, repair or replace windows, doors or plate glass of the Premises.
Lessee

 

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expressly waives the benefit of any statute now or hereafter in effect to the
extent it is inconsistent with the terms of this Lease.

 

7.3                                                                                
Utility Installations; Trade Fixtures; Alterations.

 

(a) Definitions. The term “Utility installations” refers to all floor and window
coverings, air lines, power panels, electrical distribution, security and fire
protection systems, communication systems, lighting fixtures, HVAC equipment,
plumbing, and fencing in or on the Premises. The term “Trade Fixtures” shall
mean Lessee’s machinery and equipment that can be removed without doing material
damage to the Premises. The term “Alterations” shall mean any modification of
the improvements, other than Utility installations or Trade Fixtures, whether by
addition or deletion. “Lessee Owned Alterations and/or Utility Installations”
are defined as Alterations and/or Utility Installations made by Lessee that are
not yet owned by Lessor pursuant to Paragraph 7.4(a).

 

(b) Consent. Lessee shall not make any Alterations or Utility Installations to
the Premises without Lessor’s prior written consent, which will not be
unreasonably withheld or delayed. Lessee may, however, make non-structural
Utility Installations to the interior of the Premises (excluding the roof)
without such consent but upon notice to Lessor, as long as they are not visible
from the outside, do not involve puncturing, relocating or removing the roof or
any existing walls, and the cumulative cost thereof during this Lease as
extended does not exceed a sum equal to 3 month’s Base Rent in the aggregate or
a sum equal to one month’s Base Rent in any one year. Notwithstanding the
foregoing, Lessee shall not make or permit any roof penetrations and/or install
anything on the roof without the prior written approval of Lessor. Any
Alterations or Utility Installations that Lessee shall desire to make and which
require the consent of the Lessor shall be presented to Lessor in written form
with detailed plans. Consent shall be deemed conditioned upon Lessee’s
(i) acquiring all applicable governmental permits, (ii) furnishing Lessor with
copies of both the permits and the plans and specifications prior to
commencement of the work, and (iii) compliance with all conditions of said
permits and other Applicable Requirements in a prompt and expeditious manner.
Any Alterations or Utility Installations shall be performed in a workmanlike
manner with good and sufficient materials. Lessee shall promptly upon completion
furnish Lessor with as-built plans and specifications. For work which costs an
amount in excess of one month’s Base Rent, Lessor may condition its consent upon
Lessee providing a lien and completion bond in an amount equal to 150% of the
estimated cost of such Alteration or Utility Installation and/or upon Lessee’s
posting an additional Security Deposit with Lessor.

 

(c) Indemnification. Lessee shall pay, when due, all claims for labor or
materials furnished or alleged to have been furnished to or for Lessee at or for
use on the Premises, which claims are or may be secured by any mechanic’s or
materialman’s lien against the Premises or any interest therein. Lessee shall
give Lessor not less than 10 days notice prior to the commencement of any work
in, on or about the Premises, and Lessor shall have the right to post notices of
non-responsibility. If Lessee shall contest the validity of any such lien, claim
or demand, then Lessee shall, at its sole expense defend and protect itself,
Lessor and the Premises against the same and shall pay and satisfy any such
adverse judgment that may be rendered thereon before the enforcement thereof. If
Lessor shall require, Lessee shall furnish a surety bond in an amount equal to
150% of the amount of such contested lien, claim or demand, indemnifying Lessor
against liability for the same. If Lessor elects to participate in any such
action, Lessee shall pay Lessor’s reasonable attorneys’ fees and costs.

 

7.4                                 Ownership; Removal; Surrender; and
Restoration.

 

(a) Ownership. Subject to Lessor’s right to require removal or elect ownership
as hereinafter provided, all Alterations and Utility Installations made by
Lessee shall be the property of Lessee, but considered a part of the Premises.
Lessor may, at any time, elect in writing to be the owner of all or any
specified part of the Lessee Owned Alterations and Utility Installations. Unless
otherwise instructed per paragraph 7.4(b) hereof, all Lessee Owned Alterations
and Utility Installations shall, at the expiration or termination of this Lease,
become the property of Lessor and be surrendered by Lessee with the Premises.

 

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(b)   Removal. Lessor may require that any or all Lessee Owned Alterations or
Utility Installations be removed by the expiration or termination of this Lease.
Lessor may require the removal at any time of all or any part of any Lessee
Owned Alterations or Utility Installations made without the required consent.

 

(c)   Surrender; Restoration. Lessee shall surrender the Premises by the
Expiration Date or any earlier termination date, with all of the improvements,
parts and surfaces thereof broom clean and free of debris, and in good operating
order, condition and state of repair, ordinary wear and tear excepted. “Ordinary
wear and tear” shall not include any damage or deterioration that would have
been prevented by good maintenance practice. Notwithstanding the foregoing, if
this Lease is for 12 months or less, then Lessee shall surrender the Premises in
the same condition as delivered to Lessee on the Start Date with NO allowance
for ordinary wear and tear. Lessee shall repair any damage occasioned by the
installation, maintenance or removal of Trade Fixtures, Lessee owned Alterations
and/or Utility Installations, furnishings, and equipment as well as the removal
of any storage tank installed by or for Lessee. Lessee shall also completely
remove from the Premises any and all Hazardous Substances brought onto the
Premises by or for Lessee, or any third party (except Hazardous Substances which
were deposited via underground migration from areas outside of the Project) even
if such removal would require Lessee to perform or pay for work that exceeds
statutory requirements. Trade Fixtures shall remain the property of Lessee and
shall be removed by Lessee. The failure by Lessee to timely vacate the Premises
pursuant to this Paragraph 7.4(c) without the express written consent of Lessor
shall constitute a holdover under the provisions of Paragraph 26 below.

 

8.                          Insurance; Indemnity.

 

8.1                              Payment of Premiums. The cost of the premiums
for the insurance policies required to be carried by Lessor, pursuant to
Paragraphs 8.2(b), 8.3(a) and 8.3(b), shall be a Common Area Operating Expense.
Premiums for policy periods commencing prior to, or extending beyond, the term
of this

 

Lease shall be prorated to coincide with the corresponding Start Date or
Expiration Date.

 

8.2                              Liability Insurance.

 

(a)   Carried by Lessee. Lessee shall obtain and keep in force a Commercial
General Liability policy of insurance protecting Lessee and Lessor as an
additional insured against claims for bodily injury, personal injury and
property damage based upon or arising out of the ownership, use, occupancy or
maintenance of the Premises and all areas appurtenant thereto. Such insurance
shall be on an occurrence basis providing single limit coverage in an amount not
less than $l,000,000 per occurrence with an annual aggregate of not less than
$2,000,000, an “Additional Insured-Managers or Lessors of Premises Endorsement
and contain the “Amendment of the Pollution Exclusion Endorsement” for damage
caused by heat, smoke or fumes from a hostile fire. The policy shall not contain
any intra-insured exclusions as between insured persons or organizations, but
shall include coverage for liability assumed under this Lease as an insured
contract” for the performance of Lessee’s indemnity obligations under this
Lease. The limits of said insurance shall not, however, limit the liability of
Lessee nor relieve Lessee of any obligation hereunder. All insurance carried by
Lessee shall be primary to and not contributory with any similar insurance
carried by Lessor, whose insurance shall be considered excess insurance only.

 

(b)   Carried by Lessor. Lessor shall maintain liability insurance as described
in Paragraph 8.2(a), in addition to, and not in lieu of, the insurance required
to be maintained by Lessee. Lessee shall not be named as an additional insured
therein.

 

8.3                               Property Insurance - Building, Improvements
and Rental Value.

 

(a)   Building and Improvements. Lessor shall obtain and keep in force a policy
or policies of insurance in the name of Lessor, with loss payable to Lessor, any
ground-lessor, and to any Lender insuring loss or damage to the Premises. The
amount of such insurance shall be equal to the full replacement cost of the
Premises, as the same shall exist from time to time, or the amount required by
any Lender, but in no event more than the commercially reasonable and available
insurable value

 

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thereof. Lessee Owned Alterations and Utility Installations, Trade Fixtures, and
Lessee’s personal property shall be insured by Lessee under Paragraph 8.4. If
the coverage is available and commercially appropriate, such policy or policies
shall insure against all risks of direct physical less or damage (except the
perils of flood and/or earthquake unless required by a Lender), including
coverage for debris removal and the enforcement of any Applicable Requirements
requiring the upgrading, demolition, reconstruction or replacement of any
portion of the Premises as the result of a covered loss. Said policy or policies
shall also contain an agreed valuation provision in lieu of any coinsurance
clause, waiver of subrogation, and inflation guard protection causing an
increase in the annual property insurance coverage amount by a factor of not
less than the adjusted U.S. Department of Labor Consumer Price Index for All
Urban Consumers for the city nearest to where the Premises are located. If such
insurance coverage has a deductible clause, the deductible amount shall not
exceed $1,000 per occurrence.

 

(b)   Rental Value. Lessor shall also obtain and keep in force a policy or
policies in the name of Lessor with loss payable to Lessor and any Lender,
insuring the loss of the full Rent for one year with an extended period of
indemnity for an additional 180 days (“Rental Value insurance”). Said insurance
shall contain an agreed valuation provision in lieu of any coinsurance clause,
and the amount of coverage shall be adjusted annually to reflect the projected
Rent otherwise payable by Lessee, for the next 12 month period.

 

(c)   Adjacent Premises. Lessee shall pay for any increase in the premiums for
the property insurance of the Building and for the Common Areas or other
buildings in the Project if said increase is caused by Lessee’s acts, omissions,
use or occupancy of the Premises.

 

(d)   Lessee’s Improvements. Since Lessor is the Insuring Party, Lessor shall
not be required to insure Lessee Owned Alterations and Utility Installations
unless the item in question has become the property of Lessor under the terms of
this Lease.

 

8.4                                Lessee’s Property; Business Interruption
Insurance.

 

(a)   Property Damage. Lessee shall obtain and maintain insurance coverage on
all of Lessee’s personal property, Trade Fixtures, and Lessee Owned Alterations
and Utility Installations. Such insurance shall be full replacement cost
coverage with a deductible of not to exceed $1,000 per occurrence. The proceeds
from any such insurance shall be used by Lessee for the replacement of personal
property, Trade Fixtures and Lessee Owned Alterations and Utility Installations.
Lessee shall provide Lessor with written evidence that such insurance is in
force.

 

(b)   Business Interruption. Lessee shall obtain and maintain loss of income and
extra expense insurance in amounts as will reimburse Lessee for direct or
indirect loss of earnings attributable to all perils commonly insured against by
prudent lessees in the business of Lessee or attributable to prevention of
access to the Premises as a result of such perils.

 

(c)   No Representation of Adequate Coverage. Lessor makes no representation
that the limits or forms of coverage of insurance specified herein are adequate
to cover Lessee’s property, business operations or obligations under this Lease.

 

8.5                               Insurance Policies. Insurance required herein
shall be by companies duly licensed or admitted to transact business in the
state where the Premises are located, and maintaining during the policy term a
“General Policyholders Rating” of at least B+, V, as set forth in the most
current issue of “Best’s Insurance Guide”, or such other rating as may be
required by a Lender. Lessee shall not do or permit to be done anything which
invalidates the required insurance policies. Lessee shall, prior to the Start
Date, deliver to Lessor certified copies of policies of such insurance or
certificates evidencing the existence and amounts of the required insurance. No
such policy shall be cancelable or subject to modification except after 30 days
prior written notice to Lessor. Lessee shall, at least 30 days prior to the
expiration of such policies, furnish Lessor with evidence of renewals or
“insurance binders” evidencing renewal thereof, or Lessor may order such
insurance and charge the cost thereof to Lessee, which amount shall be payable
by Lessee to Lessor upon demand. Such policies shall be for a term of at least
one year, or the length of the remaining term of this Lease, whichever is less.
If either Party shall fail to procure and

 

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maintain the insurance required to be carried by it, the other Party may, but
shall not be required to, procure and maintain the same.

 

8.6                               Waiver of Subrogation. Without affecting any
other rights or remedies, Lessee and Lessor each hereby release and relieve the
other, and waive their entire right to recover damages against the other, for
loss of or damage to its property arising out of or incident to the perils
required to be insured against herein. The effect of such releases and waivers
is not limited by the amount of insurance carried or required, or by any
deductibles applicable hereto. The Parties agree to have their respective
property damage insurance carriers waive any right to subrogation that such
companies may have against Lessor or Lessee, as the case may be, so long as the
insurance is not invalidated thereby.

 

8.7                                Indemnity. Except for Lessor’s gross
negligence or willful misconduct, Lessee shall indemnify, protect, defend and
hold harmless the Premises, Lessor and its agents, Lessor’s master or ground
lessor, partners and Lenders, from and against any and all claims, loss of rents
and/or damages, liens, judgments, penalties, attorneys’ and consultants) fees,
expenses and/or liabilities arising out of, involving, or in connection with,
the use and/or occupancy of the Premises by Lessee. If any action or proceeding
is brought against Lessor by reason of any of the foregoing matters, Lessee
shall upon notice defend the same at Lessee’s expense by counsel reasonably
satisfactory to Lessor and Lessor shall cooperate with Lessee in such defense.
Lessor need not have first paid any such claim in order to be defended or
indemnified.

 

8.8                              Exemption of Lessor from Liability. Lessor
shall not be liable for injury or damage to the person or goods, wares,
merchandise or other property of Lessee, Lessee’s employees, contractors,
invitees, customers, or any other person in or about the Premises, whether such
damage or injury is caused by or results from fire, steam, electricity, gas,
water or rain, or from the breakage, leakage, obstruction or other defects of
pipes, fire sprinklers, wires, appliances, plumbing, HVAC or lighting fixtures,
or from any other cause, whether the said injury or damage results from
conditions arising upon the Premises or upon other portions of the Building, or
from other sources or places. Lessor shall not be liable for any damages arising
from any act or neglect of any other tenant of Lessor nor from the failure of
Lessor to enforce the provisions of any other lease in the Project.
Notwithstanding Lessor’s negligence or breach of this Lease, Lessor shall under
no circumstances be liable for injury to Lessee’s business or for any loss of
income or profit therefrom. It being understood, however, that this section will
not serve to limit the liability of Lessor for injury or losses caused by its
willful misconduct.

 

9.                           Damage or Destruction.

 

9.1                             Definitions.

 

(a)   “Premises Partial Damage” shall mean damage or destruction to the
improvements on the Premises, other than Lessee Owned Alterations and Utility
Installations, which can reasonably be repaired in 3 months or less from the
date of the damage or destruction, and the cost thereof does not exceed a sum
equal to 6 month’s Base Rent. Lessor shall notify Lessee in writing within 30
days from the date of the damage or destruction as to whether or not the damage
is Partiar or Total.

 

(b)  “Premises Total Destruction” shall mean damage or destruction to the
improvements on the Premises, other than Lessee Owned Alterations and Utility
Installations and Trade Fixtures, which cannot reasonably be repaired in 3
months or less from the date of the damage or destruction and/or the cost
thereof exceeds a sum equal to 6 months Base Rent. Lessor shall notify Lessee in
writing within 30 days from the date of the damage or destruction as to whether
or not the damage is Partial or Total.

 

(c)   “Insured Loss” shall mean damage or destruction to improvements on the
Premises, other than Lessee Owned Alterations and Utility Installations and
Trade Fixtures, which was caused by an event required to be covered by the
insurance described in Paragraph 8.3(a), irrespective of any deductible amounts
or coverage limits involved.

 

(d)   “Replacement Cost” shall mean the cost to repair or rebuild the
improvements owned by Lessor at the time of the occurrence to their condition
existing immediately prior thereto, including

 

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demolition, debris removal and upgrading required by the operation of Applicable
Requirements, and without deduction for depreciation.

 

(e) “Hazardous Substance Condition” shall mean the occurrence or discovery of a
condition involving the presence of, or a contamination by, a Hazardous
Substance as defined in Paragraph 6.2(a), in, on, or under the Premises.

 

9.2                             Partial Damage - Insured Loss. If a Premises
Partial Damage that is an Insured Loss occurs, then Lessor shall, at Lessor’s
expense, repair such damage (but not Lessee’s Trade Fixtures or Lessee Owned
Alterations and Utility Installations) as soon as reasonably possible and this
Lease shall continue in full force and effect;. Notwithstanding the foregoing,
if the required insurance was not in force or the insurance proceeds are not
sufficient to effect such repair, the Insuring Party shall promptly contribute
the shortage in proceeds as and when required to complete said repairs. In the
event, however, such shortage was due to the fact that, by reason of the unique
nature of the improvements, full replacement cost insurance coverage was not
commercially reasonable and available, Lessor shall have no obligation to pay
for the shortage in insurance proceeds or to fully restore the unique aspects of
the Premises unless Lessee provides Lessor with the funds to cover same, or
adequate assurance thereof, within 10 days following receipt of written notice
of such shortage and request therefor. If Lessor receives said funds or adequate
assurance thereof within said 10 day period, the party responsible for making
the repairs shall complete them as soon as reasonably possible and this Lease
shall remain in full force and effect. If such funds or assurance are not
received, Lessor shall elect by written notice to Lessee within 10 days
thereafter to: (i) make such restoration and repair as is commercially
reasonable with Lessor paying any shortage in proceeds, in which case this Lease
shall remain in full force and effect, or (ii) have this Lease terminate 30 days
thereafter. Lessee shall not be entitled to reimbursement of any funds
contributed by Lessee to repair any such damage or destruction. Premises Partial
Damage due to flood or earthquake shall be subject to Paragraph 9.3,
notwithstanding that there may be some insurance coverage, but the net proceeds
of any such insurance shall be made available for the repairs if made by either
Party.

 

9.3                                Partial Damage - Uninsured Loss. If a
Premises Partial Damage that is not an Insured Loss occurs, unless caused by a
negligent or willful act of Lessee (in which event Lessee shall make the repairs
at Lessee’s expense), Lessor shall either: (i) repair such damage as soon as
reasonably possible at Lessor’s expense, in which event this Lease shall
continue in full force and effect, or (ii) terminate this Lease by giving
written notice to Lessee within 30 days after receipt by Lessor of knowledge of
the occurrence of such damage. Such termination shall be effective 60 days
following the date of such notice. In the event Lessor elects to terminate this
Lease, Lessee shall have the right within 10 days after receipt of the
termination notice to give written notice to Lessor of Lessee’s commitment to
pay for the repair of such damage without reimbursement from Lessor. Lessee
shall provide Lessor with said funds or satisfactory assurance thereof within 30
days after making such commitment. In such event this Lease shall continue in
full force and effect, and Lessor shall proceed to make such repairs as soon as
reasonably possible after the required funds are available. If Lessee does not
make the required commitment, this Lease shall terminate as of the date
specified in the termination notice.

 

9.4                                Total Destruction. Notwithstanding any other
provision hereof, if a Premises Total Destruction occurs, this Lease shall
terminate 60 days following such Destruction. If the damage or destruction was
caused by the gross negligence or willful misconduct of Lessee, Lessor shall
have the right to recover Lessor’s damages from Lessee, except as provided in
Paragraph 8.6.

 

9.5                                Damage Near End of Term. If at any time
during the last 6 months of this Lease (determined for this purpose with the
assumption that Lessee shall exercise any option to extend the term of the
Lease) there is damage for which the cost to repair exceeds six months Base
Rent, whether or not an Insured Loss, Lessor may terminate this Lease effective
60 days following the date of occurrence of such damage by giving a written
termination notice to Lessee within 30 days after the date of occurrence of such
damage. Notwithstanding the foregoing, if Lessee at that time has an exercisable
option to extend this Lease or to purchase the Premises, then Lessee may
preserve this Lease by, (a) exercising such option and (b) providing Lessor with
any shortage in insurance proceeds (or

 

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adequate assurance thereof needed to make the repairs on or before the earlier
of (i) the date which is 10 days after Lessee’s receipt of Lessor’s written
notice purporting to terminate this Lease, or (ii) the day prior to the date
upon which such option expires. If Lessee duly exercises such option during such
period and provides Lessor with funds (or adequate assurance thereof) to cover
any shortage in insurance proceeds, Lessor shall, at Lessor’s commercially
reasonable expense, repair such damage as soon as reasonably possible and this
Lease shall continue in full force and effect. If Lessee fails to exercise such
option and provide such funds or assurance during such period, then this Lease
shall terminate on the date specified in the termination notice and Lessee’s
option shall be extinguished.

 

9.6                              Abatement of Rent; Lessee’s Remedies.

 

(a)   Abatement. In the event of Premises Partial Damage or Premises Total
Destruction or a Hazardous Substance Condition for which Lessee is not
responsible under this Lease, the Rent payable by Lessee for the period required
for the repair, remediation or restoration of such damage shall be abated in
proportion to the degree to which Lessee’s use of the Premises is impaired, but
not to exceed the proceeds received from the Rental Value insurance. All other
obligations of Lessee hereunder shall be performed by Lessee, and Lessor shall
have no liability for any such damage, destruction, remediation, repair or
restoration except as provided herein.

 

(b)   Remedies. If Lessor shall be obligated to repair or restore the Premises
and does not commence, in a substantial and meaningful way, such repair or
restoration within 90 days after such obligation shall accrue, Lessee may, at
any time prior to the commencement of such repair or restoration, give written
notice to Lessor and to any Lenders of which Lessee has actual notice, of
Lessee’s election to terminate this Lease on a date not less than 60 days
following the giving of such notice. If Lessee gives such notice and such repair
or restoration is not commenced within 30 days thereafter, this Lease shall
terminate as of the date specified in said notice. If the repair or restoration
is commenced within such 30 days, this Lease shall continue in full force and
effect. “Commence” shall mean either the unconditional authorization of the
preparation of the required plans, or the beginning of the actual work on the
Premises, whichever first occurs.

 

9.7                              Termination; Advance Payments. Upon termination
of this Lease pursuant to Paragraph 6.2(9) or Paragraph 9, an equitable
adjustment shall be made concerning advance Base Rent and any other advance
payments made by Lessee to Lessor. Lessor shall, in addition, return to Lessee
so much of Lessee’s Security Deposit as has not been, or is not then requked to
be, used by Lessor.

 

9.8                               Waive Statutes. Lessor and Lessee agree that
the terms of this Lease shall govern the effect of any damage to or destruction
of the Premises with respect to the termination of this Lease and hereby waive
the provisions of any present or future statute to the extent inconsistent
herewith.

 

10.                      Real Property Taxes.

 

10.1                              Definition, As used herein, the term. ’Real
Property Taxes shall include any form of assessment; real estate, general,
special, ordinary or extraordinary, or rental levy or tax (other than
inheritance, personal income or estate taxes); improvement bond; and/or license
fee imposed upon or levied against any legal or equitable interest of Lessor in
the Project, Lessor’s right to other income therefrom, and/or Lessor’s business
of leasing, by any authority having the direct or indirect power to tax and
where the funds are generated with reference to the Project address and where
the proceeds so generated are to be applied by the city, county or other local
taxing authority of a jurisdiction within which the Project is located. The term
“Real Property Taxes” shall also include any tax, fee, levy, assessment or
charge, or any increase therein, imposed by reason of events occurring during
the term of this Lease, including but not limited to, a change in the ownership
of the Project or any portion thereof or a change in the improvements thereon.
In calculating Real Property Taxes for any calendar year, the Real Property
Taxes for any real estate tax year shall be included in the calculation of Real
Property Taxes for such calendar year based upon the number of days which such
calendar year and tax year have in common.

 

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10.2                         Payment of Taxes. Lessor shall pay the Real
Property Taxes applicable to the Project, and except as otherwise provided in
Paragraph 10.3, any such amounts shall be included in the calculation of Common
Area Operating Expenses in accordance with the provisions of Paragraph 4.2.

 

10.3                        Additional Improvements. Common Area Operating
Expenses shall not include Real Property Taxes specified in the tax assessor’s
records and work sheets as being caused by additional improvements placed upon
the Project by other lessees or by Lessor for the exclusive enjoyment of such
other lessees. Notwithstanding Paragraph 10.2 hereof, Lessee shall, however, pay
to Lessor at the time Common Area Operating Expenses are payable under Paragraph
4.2, the entirety of any increase in Real Property Taxes if assessed solely by
reason of Alterations, Trade Fixtures or Utility Installations placed upon the
Premises by Lessee or at Lessee’s request.

 

10.4                              Joint Assessment. If the Building is not
separately assessed, Real Property Taxes allocated to the Building shall be an
equitable proportion of the Real Property Taxes for all of the land and
improvements included within the tax parcel assessed, such proportion to be
determined by Lessor from the

 

respective valuations assigned in the assessor’s work sheets or such other
information as may be reasonably available. Lessor’s reasonable determination
thereof, in good faith, shall be conclusive.

 

10.5                              Personal Property Taxes. Lessee shall pay
prior to delinquency all taxes assessed against and levied upon Lessee Owned
Alterations and Utility Installations, Trade Fixtures, furnishings, equipment
and all personal property of Lessee contained in the Premises. When possible
Lessee shall cause its Lessee Owned Alterations and Utility Installations, Trade
Fixtures, furnishings, equipment and all other personal property to be assessed
and billed separately from the real property of Lessor. If any of Lessee’s said
property shall be assessed with Lessor’s real property, Lessee shall pay Lessor
the taxes attributable to Lessee’s property within 10 days after receipt of a
written statement setting forth the taxes applicable to Lessee’s property.

 

11.                       Utilities. Lessee shall pay for all water, gas, heat,
light, power, telephone, trash disposal and other utilities and services
supplied to the Premises, together with any taxes thereon. Notwithstanding the
provisions of Paragraph 4.2, if at any time in Lessor’s sole judgment, Lessor
determines that Lessee is using a disproportionate amount of water, electricity
or other commonly metered utilities, or that Lessee is generating such a large
volume of trash as to require an increase in the size of the dumpster and/or an
increase in the number of times per month that the dumpster is emptied, then
Lessor may increase Lessee’s Base Rent by an amount equal to such increased
costs.

 

12.                       Assignment and Subletting.

 

12.1                            Lessor’s Consent Required.

 

(a)  Lessee shall not voluntarily or by operation of law assign, transfer,
mortgage or encumber (collectively, “assign or assignment”) or sublet all or any
part of Lessee’s interest in this Lease or in the Premises without Lessor’s
prior written consent, which shall not be unreasonably withheld or delayed.

 

(b)  Lessee may assign the Lease to an affiliate entity without Landlord
approval,

 

(d) An assignment or subletting without consent shall, at Lessor’s option, be a
Default curable after notice per Paragraph 13.1(c), or a noncurable Breach
without the necessity of any notice and grace period. If Lessor elects to treat
such unapproved assignment or subletting as a noncurable Breach, Lessor may
either: (i) terminate this Lease, or (ii) upon 30 days written notice, increase
the monthly Base Rent to 110% of the Base Rent then in effect. Further, in the
event of such Breach and rental adjustment, (i) the purchase price of any option
to purchase the Premises held by Lessee shall be subject to similar adjustment
to 110% of the price previously in effect, and (ii) all fixed and non-fixed
rental adjustments scheduled during the remainder of the Lease term shall be
increased to 110% of the scheduled adjusted rent.

 

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(e) Lessee’s remedy for any breach of Paragraph 12.1 by Lessor shall be limited
to compensatory damages and/or injunctive relief.

 

12.2                          Terms and Conditions Applicable to Assignment and
Subletting.

 

(a)   Regardless of Lessor’s consent, no assignment or subletting shall: (i) be
effective without the express written assumption by such assignee or sublessee
of the Obligations of Lessee under this Lease, (ii) release Lessee of any
obligations hereunder, or (iii) alter the primary liability of Lessee for the
payment of Rent or for the performance of any other obligations to be performed
by Lessee.

 

(b)  Lessor may accept Rent or performance of Lessee’s obligations from any
person other than Lessee pending approval or disapproval of an assignment.
Neither a delay in the approval or disapproval of such assignment nor the
acceptance of Rent or performance shall constitute a waiver or estoppel of
Lesson’s right to exercise its remedies for Lessee’s Default or Breach.

 

(c)   Lessor’s consent to any assignment or subletting shall not constitute a
consent to any subsequent assignment or subletting.

 

(d)  In the event of any Default or Breach by Lessee, Lessor may proceed
directly against Lessee, or anyone else responsible for the performance of
Lessee’s obligations under this Lease, including any assignee or sublessee,
without first exhausting Lessor’ s remedies against any other person or entity
responsible therefore to Lessor, or any security held by Lessor.

 

(e)   Each request for consent to an assignment or subletting shall be in
writing, accompanied by information relevant to Lessor’s determination as to the
financial and operational responsibility and appropriateness of the proposed
assignee or sublessee, including but not limited to the intended use and/or
required modification of the Premises, if any, together with a fee of $500, as
consideration for Lessor’s considering and processing said request. Lessee
agrees to provide Lessor with such other or additional information and/or
documentation as may be reasonably requested.

 

(f)   Any assignee of, or sublessee under, this Lease shall, by reason of
accepting such assignment or entering into such sublease, be deemed to have
assumed and agreed to conform and comply with each and every term, covenant,
condition and obligation herein to be observed or performed by Lessee during the
term of said assignment or sublease, other than such obligations as are contrary
to or inconsistent with provisions of an assignment or sublease to which Lessor
has specifically consented to in writings.

 

(g)  Lessor’s consent to any assignment or subletting shall not transfer to the
assignee or sublessee any Option granted to the original Lessee by this Lease
unless such transfer is specifically consented to by Lessor in writing. (See
Paragraph 39.2)

 

12.3 Additional Terms and Conditions Applicable to Subletting. The following
terms and conditions shall apply to any subletting by Lessee of all or any part
of the Premises and shall be deemed included in all subleases under this Lease
whether or not expressly incorporated therein:

 

(a) Lessee hereby assigns and transfers to Lessor all of Lessee’s interest in
all Rent payable on any sublease, and Lessor may collect such Rent and apply
same toward Lessee’s obligations under this Lease; provided, however, that until
a Breach shall occur in the performance of Lessee’s obligations, Lessee may
collect said Rent. Lessor shall not, by reason of the foregoing or any
assignment of such sublease, nor by reason of the collection of Rent, be deemed
liable to the sublessee for any failure of Lessee to perform and comply with any
of Lessee’s obligations to such sublessee. Lessee hereby irrevocably authorizes
and directs any such sublessee, upon receipt of a written notice from Lessor
stating that a Breach exists in the performance of Lessee’s obligations under
this Lease, to pay to Lessor all Rent due and to become due under the sublease.
Sublessee shall rely upon any such notice from Lessor and shall pay all Rents to
Lessor without any obligation or right to inquire as to whether such Breach
exists, notwithstanding any claim from Lessee to the contrary.

 

(b) In the event of a Breach by Lessee, Lessor may, at its option, require
sublessee to attorn to Lessor, in which event Lessor shall undertake the
obligations of the sublessor under such sublease from the time of the exercise
of said option to the expiration of such sublease; provided, however, Lessor
shall not be liable for any prepaid rents or security deposit paid by such
sublessee to such sublessor or for any prior Defaults or Breaches of such
sublessor.

 

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(c)   Any matter requiring the consent of the sublessor under a sublease shall
also require the consent of Lessor.

 

(d)   No sublessee shall further assign or sublet all or any pad of the Premises
without Lessor’s prior written consent.

 

(e)   Lessor shall deliver a copy of any notice of Default or Breach by Lessee
to the sublessee, who shall have the right to cure the Default of Lessee within
the grace period, if any, specified in such notice. The sublessee shall have a
right of reimbursement and offset from and against Lessee for any such Defaults
cured by the sublessee.

 

13.                       Default; Breach, Remedies.

 

13.1                   Default; Breach. A “Default” is defined as a failure by
the Lessee to comply with or perform any of the terms, covenants, conditions or
Rules and Regulations under this Lease. A “Breach” is defined as the occurrence
of one or more of the following Defaults, and the failure of Lessee to cure such
Default within any applicable grace period:

 

(a) The abandonment of the “Premises; or the vacating of the Premises without
providing a commercially reasonable level of security, or where the coverage of
the property insurance described in Paragraph 8.3  is jeopardized as a result
thereof, or without providing reasonable assurances to minimize potential
vandalism.

 

(b)   The failure of Lessee to make any payment of Rent or any Security Deposit
required to be made by Lessee hereunder, whether to Lessor or to a third party,
when due, to provide reasonable evidence of insurance or surety bond, or to
fulfill any obligation under this Lease which endangers or threatens life or
property, where such failure continues for a period of 3 business days following
written notice to Lessee.

 

(c)   The failure by Lessee to provide (i) reasonable written evidence of
compliance with Applicable Requirements, (ii) the service contracts described in
Section 7.1(b), (iii) the rescission of an unauthorized assignment or
subletting, (iv) an Estoppel Certificate, (v) a subordination required to be
given pursuant to Section 30.1, (vi) any document requested under Paragraph 41
(easements), or (vii) any other documentation or information which Lessor may
reasonably require of Lessee under the terms of this Lease, where any such
failure continues for a period of 10 days following written notice to Lessee.

 

(d)   A Default by Lessee as to the terms, covenants, conditions or provisions
of this Lease, or of the rules adopted under Paragraph 2.9 hereof, other than
those described in subparagraphs 13.1(a), (b) or (c), above, where such Default
continues for a period of 30 days after written notice; provided, however that
if the nature of Lessee’s Default is such that more than 30 days are reasonably
required for its cure, then it shall not be deemed to be a Breach if Lessee
commences such cure within said 30 day period and thereafter diligently
prosecutes such cure to completion.

 

(e)   The occurrence of any of the following events: (i) the making of any
general arrangement or assignment for the benefit of creditors; (ii) becoming a
“debtor” as defined in 11 U.S.C. 101 or any successor statute thereto (unless,
in the case of a petition filed against Lessee, the same is dismissed within 60
days), (iii) the appointment of a trustee or receiver to take possession of
substantially all of Lessee’s assets located at the Premises or of Lessee’s
interest in this Lease, where possession is not restored to Lessee within 30
days; or (iv) the attachment, execution or other judicial seizure of
substantially all of Lessee’s assets located at the Premises or of Lessee’s
interest in this Lease, where such seizure is not discharged within 30 days;
provided, however, in the event that any provision of this subparagraph (e) is
contrary to any applicable law, such provision shall be of no force or effect,
and not affect the validity of the remaining provisions.

 

(f)   The discovery that any financial statement of Lessee given to Lessor was
materially false.

 

13.2             Remedies. If Lessee fails to perform any of its affirmative
duties or obligations, within 10 days after written notice (or in case of an
emergency, without notice), Lessor may, at its option, perform such duty or
obligation on Lessee’s behalf, including but not limited to the obtaining of
reasonably required bonds, insurance policies, or governmental licenses, permits
or approvals. The costs

 

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and expenses of any such performance by Lessor shall be due and payable by
Lessee upon receipt of invoice therefor. If any check given to Lessor by Lessee
shall not be honored by the bank upon which it is drawn, Lessor, at its option,
may require all future payments to be made by Lessee to be by cashier’s check.
In the event of a Breach, Lessor may, with or without further notice or demand,
and without limiting Lessor in the exercise of any right or remedy which Lessor
may have by reason of such Breach:

 

(a)   Terminate Lessee’s right to possession of the Premises by any lawful
means, in which case this Lease shall terminate and Lessee shall immediately
surrender possession to Lessor. In such event Lessor shall be entitled to
recover from Lessee: (i) the unpaid Rent which had been earned at the time of
termination; (ii) the worth at the time of award of the amount by which the
unpaid rent which would have been earned after termination until the time of
award exceeds the amount of such rental loss that the Lessee proves could have
been reasonably avoided; (iii) the worth at the time of award of the amount by
which the unpaid rent for the balance of the term after the time of award
exceeds the amount of such rental loss that the Lessee proves could be
reasonably avoided; and (iv) any other amount necessary to compensate Lessor for
all the detriment proximately caused by the Lessee’s failure to perform its
obligations under this Lease or which in the ordinary course of things would be
likely to result therefrom, including but not limited to the cost of recovering
possession of the Premises, expenses of reletting, including necessary
renovation and alteration of the Premises, reasonable attorneys’ fees, and that
portion of any leasing commission paid by Lessor in connection with this Lease
applicable to the unexpired term of this Lease. The worth at the time of award
of the amount referred to in provision (iii) of the immediately preceding
sentence shall be computed by discounting such amount at the discount rate of
the Federal Reserve Bank of the District within which the Premises are located
at the time of award plus one percent. Efforts by Lessor to mitigate damages
caused by Lessee’s Breach of this Lease shall not waive Lessor’s right to
recover damages under Paragraph 12. If termination of this Lease is obtained
through the provisional remedy of unlawful detainer, Lessor shall have the right
to recover in such proceeding any unpaid Rent and damages as are recoverable
therein, or Lessor may reserve the right to recover all or any part thereof in a
separate suit. If a notice and grace period required under Paragraph 13.1 was
not previously given, a notice to pay rent or quit, or to perform or quit given
to Lessee under the unlawful detainer statute shall also constitute the notice
required by Paragraph 13.1. In such case, the applicable grace period required
by Paragraph 13.1 and the unlawful detainer statute shall run concurrently, and
the failure of Lessee to cure the Default within the greater of the two such
grace periods shall constitute both an unlawful detainer and a Breach of this
Lease entitling Lessor to the remedies provided for in this Lease and/or by said
statute.

 

(b)   Continue the Lease and Lessee’s right to possession and recover the Rent
as it becomes due, in which event Lessee may sublet or assign, subject only to
reasonable limitations. Acts of maintenance, efforts to relet, and/or the
appointment of a receiver to protect the Lessor’s interests, shall not
constitute a termination of the Lessee’s right to possession.

 

(c)           Pursue any other remedy now or hereafter available under the laws
or judicial decisions of the state wherein the Premises are located. The
expiration or termination of this Lease and/or the termination of Lessee’s right
to possession shall not relieve Lessee from liability under any indemnity
provisions of this Lease as to makers occurring or accruing during the term
hereof or by reason of Lessee’s occupancy of the Premises.

 

13.3            [Reserved].

 

13.4            Late Charges. Lessee hereby acknowledges that late payment by
Lessee of Rent will cause Lessor to incur costs not contemplated by this Lease,
the exact amount of which will be extremely difficult to ascertain. Such costs
include, but are not limited to, processing and accounting charges, and late
charges which may be imposed upon Lessor by any Lender. Accordingly, if any Rent
shall not be received by Lessor within 5 days after such amount shall be due,
then, without any requirement for notice to Lessee, Lessee shall pay to Lessor a
one-time late charge equal to $100,. The parties hereby agree that such late
charge represents a fair and reasonable estimate of the costs Lessor will incur
by reason of such late payment. Acceptance of such late charge by Lessor shall
in no event

 

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constitute a waiver of Lessee’s Default or Breach with respect to such overdue
amount, nor prevent the exercise of any of the other rights and remedies granted
hereunder. In the event that a late charge is payable hereunder, whether or not
collected, for 3 consecutive installments of Base Rent, then notwithstanding any
provision of this Lease to the contrary, Base Rent shall, at Lessor’s option,
become due and payable quarterly in advance.

 

13.5             Interest. Any monetary payment due Lessor hereunder, other than
late charges, not received by Lessor, within 30 days following the date on which
it was due shall bear interest from the 31st day after it was due. The interest
(“Interest”) charged shall be equal to the prime rate reported in the Wall
Street Journal as published closest prior to the date when due plus 2%, but
shall not exceed the maximum rate allowed by law. Interest is payable in
addition to the potential late charge provided for in Paragraph 13.4.

 

13.6             Breach by Lessor.

 

(a)   Notice of Breach. Lessor shall not be deemed in breach of this Lease
unless Lessor fails within a reasonable time to perform an obligation required
to be performed by Lessor. For purposes of this Paragraph, a reasonable time
shall in no event be less than 30 days after receipt by Lessor, and any Lender
whose name and address shall have been furnished Lessee in writing for such
purpose, of written notice specifying wherein such obligation of Lessor has not
been performed; provided, however, that if the nature of Lessor’s obligation is
such that more than 30 days are reasonably required for its performance then
Lessor shall not be in breach if performance is commenced within such 30 day
period and thereafter diligently pursued to completion.

 

(b)   Performance by Lessee on Behalf of Lessor. In the event that neither
Lessor nor Lender cures said breach within 30 days after receipt of said notice,
or if having commenced said cure they do not diligently pursue it to completion,
then Lessee may elect to cure said breach at Lessee’s expense and offset from
Rent an amount equal to the greater of one month’s Base Rent or the Security
Deposit, and to pay an excess of such expense under protest, reserving Lessee’s
right to reimbursement from Lessor. Lessee shall document the cost of said cure
and supply said documentation to Lessor. d

 

14.   Condemnation. If the Premises or any portion thereof are taken under the
power of eminent domain or sold under the threat of the exercise of said power
(collectively “Condemnation”), this Lease shall terminate as to the part taken
as of the date the condemning authority takes title or possession, whichever
first occurs. If more than 10% of the floor area of the Unit, or more than 25%
of Lessee’s Reserved Parking Spaces, is taken by Condemnation, Lessee may, at
Lessee’s option, to be exercised in writing within 10 days after Lessor shall
have given Lessee written notice of such taking (or in the absence of such
notice, within 10 days after the condemning authority shall have taken
possession) terminate this Lease as of the date the condemning authority takes
such possession. If Lessee does not terminate this Lease in accordance with the
foregoing, this Lease shall remain in full force and effect as to the portion of
the Premises remaining, except that the Base Rent shall be reduced in proportion
to the reduction in utility of the Premises caused by such Condemnation.
Condemnation awards and/or payments shall be the property of Lessor, whether
such award shall be made as compensation for diminution in value of the
leasehold, the value of the part taken, or for severance damages; provided,
however, that Lessee shall be entitled to any compensation for Lessee’s
relocation expenses, loss of business goodwill and/or Trade Fixtures, without
regard to whether or not this Lease is terminated pursuant to the provisions of
this Paragraph. All Alterations and Utility Installations made to the Premises
by Lessee, for purposes of Condemnation only, shall be considered the property
of the Lessee and Lessee shall be entitled to any and all compensation which is
payable therefor. In the event that this Lease is not terminated by reason of
the Condemnation, Lessor shall repair any damage to the Premises caused by such
Condemnation.

 

15.                 Brokerage Fees.

 

15.1            Additional Commission. In addition to the payments owed pursuant
to Paragraph 1.10 above, and unless Lessor and the Brokers otherwise agree in
writing, Lessor agrees that: (a) if

 

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Lessee exercises any Option, (b) if Lessee acquires from Lessor any rights to
the Premises or other premises owned by Lessor and located within the Project,
(c) if Lessee remains in possession of the Premises, with the consent of Lessor,
after the expiration of this Lease, or (d) if Base Rent is increased, whether by
agreement or operation of an escalation clause herein, then, Lessor shall pay
Brokers a fee in accordance with the schedule of the Brokers in effect at the
time of the execution of this Lease.

 

15.2                           Assumption of Obligations. Any buyer or
transferee of Lessor’s interest in this Lease shall be deemed to have assumed
Lessor’s obligation hereunder. Brokers shall be third party beneficiaries of the
provisions of Paragraphs 1.10, 15, 22 and 31. If Lessor fails to pay to Brokers
any amounts due as and for brokerage fees pertaining to this Lease when due,
then such amounts shall accrue interest. In addition, if Lessor fails to pay any
amounts to Lessee’s Broker when due, Lessee’s Broker may send written notice to
Lessor and Lessee of such failure and if Lessor fails to pay such amounts within
10 days after said notice, Lessee shall pay said monies to its Broker and offset
such amounts against Rent. In addition, Lessee’s Broker shall be deemed to be a
third party beneficiary of any commission agreement entered into by and/or
between Lessor and Lessor’s Broker for the limited purpose of collecting any
brokerage fee owed.

 

15.3                           Representations and Indemnities of Broker
Relationships. Lessee and Lessor each represent and warrant to the other that it
has had no dealings with any person, firm, broker or finder (other than the
Brokers, if any) in connection with this Lease, and that no one other than said
named Brokers is entitled to any commission or finders fee in connection
herewith. Lessee and Lessor do each hereby agree to indemnify, protect, defend
and hold the other harmless from and against liability for compensation or
charges which may be claimed by any such unnamed broker, finder or other similar
party by reason of any dealings or actions of the indemnifying Party, including
any costs, expenses, attorneys’ fees reasonably incurred with respect thereto.

 

16.                                 Estoppel Certificates.

 

(a)  Each Party (as “Responding Party”) shall within 10 days after written
notice from the other Party (the “Requesting Party”) execute, acknowledge and
deliver to the Requesting Party a statement in writing in form similar to the
then most current “Estoppel Certificate” form published by the American
Industrial Real Estate Association, plus such additional information,
confirmation and/or statements as may be reasonably requested by the Requesting
Party.

 

(b)  If the Responding Party shall fail to execute or deliver the Estoppel
Certificate within such 10 day period, the Requesting Party may execute an
Estoppel Certificate stating that: (i) the Lease is in full force and effect
without modification except as may be represented by the Requesting Party,
(ii) there are no uncured defaults in the Requesting Party’s performance, and
(iii) if Lessor is the Requesting Party, not more than one month’s rent has been
paid in advance. Prospective purchasers and encumbrances may rely upon the
Requesting Party’s Estoppel Certificate, and the Responding Party shall be
estopped from denying the truth of the facts contained in said Certificate.

 

(c)  If Lessor desires to finance, refinance, or sell the Premises, or any part
thereof, Lessee shall deliver to any potential lender or purchaser designated by
Lessor such financial statements as may be reasonably required by such lender or
purchaser, including but not limited to Lessee’s financial statements for the
past 3 years. All such financial statements shall be received by Lessor and such
lender or purchaser in confidence and shall be used only for the purposes herein
set forth.

 

17.                                 Definition of Lessor. The term “Lessor” as
used herein shall mean the owner or owners at the time in question of the fee
title to the Premises, or, if this is a sublease, of the Lessee’s interest in
the prior lease. In the event of a transfer of Lessor’s title or interest in the
Premises or this Lease, Lessor shall deliver to the transferee or assignee (in
cash or by credit) any unused Security Deposit held by Lessor. Except as
provided in Paragraph 15, upon such transfer or assignment and delivery of the
Security Deposit, as aforesaid, the prior Lessor shall be relieved of all
liability with respect to the obligations and/or covenants under this Lease
thereafter to be performed by the Lessor. Subject to the foregoing, the
obligations and/or covenants in this Lease to be performed by the Lessor shall
be binding

 

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only upon the Lessor as hereinabove defined and the Lessor as hereinabove
defined shall be fully liable for all of the obligations of the Lessor
hereunder. Notwithstanding the above, and subject to the provisions of Paragraph
20 below, the original Lessor under this Lease, and all subsequent holders of
the Lessor’s interest in this Lease shall remain liable and responsible with
regard to the potential duties and liabilities of Lessor pertaining to Hazardous
Substances as outlined in Paragraph 6.2 above.

 

18.                             Severability. The invalidity of any provision of
this Lease, as determined by a court of competent jurisdiction, shall in no way
affect the validity of any other provision hereof.

 

19.                               Days.  Unless otherwise specifically indicated
to the contrary, the word “days” as used in this Lease shall mean and refer to
calendar days.

 

20.                               Limitation on Liability. Subject to the
provisions of Paragraph 17 above, the obligations of Lessor under this Lease
shall not constitute personal obligations of the individual partners of Lessor
or its or their individual partners, directors, officers or shareholders, and
Lessee shall look to the Lessor, for the satisfaction of any liability of Lessor
with respect to this Lease, and shall not seek recourse against the individual
partners of Lessor, or its or their individual partners, directors, officers or
shareholders, or any of their personal assets for such satisfaction.

 

21.                               Time of Essence. Time is of the essence with
respect to the performance of all obligations to be performed or observed by the
Parties under this Lease.

 

22.                               No Prior or Other Agreements; Broker
Disclaimer. This Lease contains all agreements between the Parties with respect
to any matter mentioned herein, and no other prior or contemporaneous agreement
or understanding shall be effective. Lessor and Lessee each represents and
warrants to the Brokers that it has made, and is relying solely upon, its own
investigation as to the nature, quality, character and financial responsibility
of the other Party to this Lease and as to the use, nature, quality and
character of the Premises (except as to the specific warranties made by the
Lessor herein). Brokers have no responsibility with respect thereto or with
respect to any default or breach hereof by either Party. The liability
(including court costs and attorneys’ fees), of any Broker with respect to
negotiation, execution, delivery or performance by either Lessor or Lessee under
this Lease or any amendment or modification hereto shall be limited to an amount
up to the fee received by such Broker pursuant to this Lease; provided, however,
that the foregoing limitation on each Broker’s liability shall not be applicable
to any gross negligence or willful misconduct of such Broker.

 

23.                               Notices.

 

23.1                           Notice Requirements. All notices required or
permitted by this Lease or applicable law shall be in writing and may be
delivered in person (by hand or by courier) or may be sent by regular, certified
or registered mail or U.S. Postal Service Express Mail, with postage prepaid, or
by facsimile transmission, and shall be deemed sufficiently given if served in a
manner specified in this Paragraph 23. The addresses noted adjacent to a Party’s
signature on this Lease shall be that Party’s address for delivery or mailing of
notices. Either Party may by written notice to the other specify a different
address for notice, except that upon Lessee’s taking possession of the Premises,
the Premises shall constitute Lessee’s address for notice. A copy of all notices
to Lessor shall be concurrently transmitted to such party or parties at such
addresses as Lessor may from time to time hereafter designate in writing.

 

23.2                           Date of Notice. Any notice sent by registered or
certified mail, return receipt requested, shall be deemed given on the date of
delivery shown on the receipt card, or if no delivery date is shown, the
postmark thereon. If sent by regular mail the notice shall be deemed given 48
hours after the same is addressed as required herein and mailed with postage
prepaid. Notices delivered by United States Express Mail or overnight courier
that guarantee next day delivery shall be deemed given

 

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24 hours after delivery of the same to the Postal Service or courier. Notices
transmitted by facsimile transmission or similar means shall be deemed delivered
upon telephone confirmation of receipt (confirmation report from fax machine is
sufficient), provided a copy is also delivered via delivery or mail. If notice
is received on a Saturday, Sunday or legal holiday, it shall be deemed received
on the next business day.

 

24.                                 Waivers. No waiver by Lessor of the Default
or Breach of any term, covenant or condition hereof by Lessee, shall be deemed a
waiver of any other term, covenant or condition hereof, or of any subsequent
Default or Breach by Lessee of the same or of any other term. covenant or
condition hereof. Lessor’s consent to, or approval of, any act shall not be
deemed to render unnecessary the obtaining of Lessor’s consent to, or approval
of, any subsequent or similar act by Lessee, or be construed as the basis of an
estoppel to enforce the provision or provisions of this Lease requiring such
consent. The acceptance of Rent by Lessor shall not be a waiver of any Default
or Breach by Lessee. Any payment by Lessee may be accepted by Lessor on account
of moneys or damages due Lessor, notwithstanding any qualifying statements or
conditions made by Lessee in connection therewith, which such statements and/or
conditions shall be of no force or effect whatsoever unless specifically agreed
to in writing by Lessor at or before the time of deposit of such payment.

 

25.                                 Disclosures Regarding The Nature of a Real
Estate Agency Relationship.

 

(a) When entering into a discussion with a real estate agent regarding a real
estate transaction, a Lessor or Lessee should from the outset understand what
type of agency relationship or representation it has with the agent or agents in
the transaction. Lessor and Lessee acknowledge being advised by the Brokers in
this transaction, as follows:

 

(i) Lessor’s Agent. A Lessor’s agent under a listing agreement with the Lessor
acts as the agent for the Lessor only. A Lessor’s agent or subagent has the
following affirmative obligations: To the Lessor: A fiduciary duty of utmost
care, integrity, honesty, and loyalty in dealings with the Lessor. To the Lessee
and the Lessor: (a) Diligent exercise of reasonable skills and care in
performance of the agent’s duties. (b) A duty of honest and fair dealing and
good faith. (c) A duty to disclose all facts known to the agent materially
affecting the value or desirability of the property that are not known to, or
within the diligent attention and observation of, the Parties. An agent is not
obligated to reveal to either Party any confidential information obtained from
the other Party which does not involve the affirmative duties set forth above.

 

(ii) Lessee’s Agent. An agent can agree to act as agent for the Lessee only. In
these situations, the agent is not the Lessor’s agent, even if by agreement the
agent may receive compensation for services rendered, either in full or in part
from the Lessor. An agent acting only for a Lessee has the following affirmative
obligations. To the Lessee: A fiduciary duty of utmost care, integrity, honesty,
and loyalty in dealings with the Lessee. To the Lessee and the Lessor:
(a) Diligent exercise of reasonable skills and care in performance of the
agent’s duties. (b) A duty of honest and fair dealing and good faith. (c) A duty
to disclose all facts known to the agent materially affecting the value or
desirability of the property that are not known to, or within the diligent
attention and observation of, the Parties An agent is not obligated to reveal to
either Party any confidential information obtained from the other Party which
does not involve the affirmative duties set forth above.

 

(iii) Agent Representing Both Lessor and Lessee. A real estate agent, either
acting directly or through one or more associate licenses, can legally be the
agent of both the Lessor and the Lessee in a transaction, but only with the
knowledge and consent of both the Lessor and the Lessee. In a dual agency
situation, the agent has the following affirmative obligations to both the
Lessor and the Lessee: (a) A fiduciary duty of utmost care, integrity, honesty
and loyalty in the dealings with either Lessor or the Lessee. (b) Other duties
to the Lessor and the Lessee as stated above in subparagraphs (i) or (ii). In
representing both Lessor and Lessee, the agent may not without the express
permission of the respective Party, disclose to the other Party that the Lessor
will accept rent in an amount less than that indicated in the listing or that
the Lessee is willing to pay a higher rent than that offered. The above

 

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duties of the agent in a real estate transaction do not relieve a Lessor or
Lessee from the responsibility to protect their own interests. Lessor and Lessee
should carefully read all agreements to assure that they adequately express
their understanding of the transaction. A real estate agent is a person
qualified to advise about real estate. If legal or tax advice is desired,
consult a competent professional.

 

(b) Brokers have no responsibility with respect to any default or breach hereof
by either Party. The liability (including court costs and attorneys’ fees), of
any Broker with respect to any breach of duty, error or omission relating to
this Lease shall not exceed the fee received by such Broker pursuant to this
Lease; provided, however, that the foregoing limitation on each Broker’s
liability shall not be applicable to any gross negligence or willful misconduct
of such Broker.

 

(c) Buyer and Seller agree to identify to Brokers as “Confidential” any
communication or information given Brokers that is considered by such Party to
be confidential.

 

26.                                 No Right To Holdover. Lessee has no right to
retain possession of the Premises or any part thereof beyond the expiration or
termination of this Lease. In the event that Lessee holds over, then the Base
Rent shall be increased to 150% of the Base Rent applicable immediately
preceding the expiration or termination. Nothing contained herein shall be
construed as consent by Lessor to any holding over by Lessee.

 

27.                                 Cumulative Remedies. No remedy or election
hereunder shall be deemed exclusive but shall, wherever possible, be cumulative
with all other remedies at law or in equity.

 

28.                                 Covenants and Conditions; Construction of
Agreement. All provisions of this Lease to be observed or performed by Lessee
are both covenants and conditions. In construing this Lease, all headings and
titles are for the convenience of the Parties only and shall not be considered a
part of this Lease. Whenever required by the context, the singular shall include
the plural and vice versa. This Lease shall not be construed as ff prepared by
one of the Parties, but rather according to its fair meaning as a whole, as if
both Parties had prepared it.

 

29.                                 Binding Effect; Choice of Law. This Lease
shall be binding upon the parties, their personal representatives, successors
and assigns and be governed by the laws of the State in which the Premises are
located. Any litigation between the Parties hereto concerning this Lease shall
be initiated in the county in which the Premises are located.

 

30.                                 Subordination; Attornment, Non-Disturbance.

 

30.1                           Subordination. This Lease and any Option granted
hereby shall be subject and subordinate to any ground lease, mortgage, deed of
trust, or other hypothecation or security device (collectively, “Security
device”), now or hereafter placed upon the Premises, to any and all advances
made on the security thereof, and to all renewals, modifications, and extensions
thereof. Lessee agrees that the holders of any such Security Devices (in this
Lease together referred to as “Lender”) shall have no liability or obligation to
perform any of the obligations of Lessor under this Lease. Any Lender may elect
to have this Lease and/or any Option granted hereby superior to the lien of its
Security Device by giving written notice thereof to Lessee, whereupon this Lease
and such Options shall be deemed prior to such Security Device, notwithstanding
the relative dates of the documentation or recordation thereof.

 

30.2                           Attornment. In the event that Lessor transfers
title to the Premises, or the Premises are acquired by another upon the
foreclosure or termination of a Security Device to which this Lease is
subordinated (i) Lessee shall, subject to the non-disturbance provisions of
Paragraph 30.3, attorn to such new owner, and upon request, enter into a new
lease, containing all of the terms and provisions of this Lease, with such new
owner for the remainder of the term hereof, or, at the election of such new
owner, this Lease shall automatically become a new Lease between Lessee and such
new owner, upon all of the terms and conditions hereof, for the remainder of the
term hereof, and (ii) Lessor shall thereafter be relieved of any further
obligations hereunder and such new owner shall assume all of Lessor’s

 

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obligations hereunder, except that such new owner shall not: (a) be liable for
any act or omission of any prior lessor or with respect to events occurring
prior to acquisition of ownership; (b) be subject to any offsets or defenses
which Lessee might have against any prior lessor, (c) be bound by prepayment of
more than one month’s rent, or (d) be liable for the return of any security
deposit paid to any prior lessor.

 

30.3                           DELETED

 

30.4                           Self-Executing. The agreements contained in this
Paragraph 30 shall be effective without the execution of any further documents;
provided, however, that, upon written request from Lessor or a Lender in
connection with a sale, financing or refinancing of the Premises, Lessee and
Lessor shall execute such further writings as may be reasonably required to
separately document any subordination, attornment and/or Non-Disturbance
Agreement provided for herein.

 

31.                                 Attorneys’ Fees. If any Party or Broker
brings an action or proceeding involving the Premises whether founded in tort,
contract or equity, or to declare rights hereunder, the Prevailing Party (as
hereinafter defined) in any such proceeding, action, or appeal thereon, shall be
entitled to reasonable attorneys’ fees. Such fees may be awarded in the same
suit or recovered in a separate suit, whether or not such action or proceeding
is pursued to decision or judgment. The term, “Prevailing Party” shall include,
without limitation, a Party or Broker who substantially obtains or defeats the
relief sought, as the case may be, whether by compromise, settlement, judgment,
or the abandonment by the other Party or Broker of its claim or defense. The
attorneys’ fees award shall not be computed in accordance with any court fee
schedule, but shall be such as to fully reimburse all attorneys’ fees reasonably
incurred. In addition, Lessor shall be entitled to attorneys” tees, costs and
expenses incurred in the preparation and service of notices of Default and
consultations in connection therewith, whether or not a legal action is
subsequently commenced in connection with such Default or resulting Breach (S200
is a reasonable minimum per occurrence for such services and consultation).

 

32.                                 Lessor’s Access; Showing Premises; Repairs.
Lessor and Lessor’s agents shall have the right to enter the Premises at any
time, in the case of an emergency, and otherwise at reasonable times upon
reasonable prior written notice for the purpose of showing the same to
prospective purchasers, lenders, or tenants, and making such alterations,
repairs, improvements or additions to the Premises as Lessor may deem necessary.
Lessee shall have the right to have its employee accompany Lessor and Lessor’s
invitees during such showings. It is further understood and agreed that, because
Lessee is a financial institution, Lessor shall not have the right to examine or
inspect Lessee’s books, records and other information located at the premises,
except to the extent permitted by the lessee’s primary regulator. All such
activities shall be without abatement of rent or liability to Lessee. Lessor may
at any time place on the Premises any ordinary “For Sale” signs and Lessor may
during the last 6 months of the term hereof place on the Premises any ordinary
“For Lease” signs. Lessee may at any time place on the Premises any ordinary
“For Sublease” sign.

 

33.                                 Auctions. Lessee shall not conduct, nor
permit to be conducted, any auction upon the Premises without Lessor’s prior
written consent. Lessor shall not be obligated to exercise any standard of
reasonableness in determining whether to permit an auction.

 

34.                                 Signs. Lessee may install, at Lessee’s
expenses but at no additional charge to Lessee hereunder, the maximum building,
storefront, pylon and monument signage permitted by applicable codes. Lessor
hereby approves Lessee’s proposed signage as depicted in the diagrams attached
hereto as Exhibit     , and consents to such advertising material as conforms to
Lessee’s area-wide marketing practice. Lessor shall at its sole cost and expense
prepare the exterior of the Premises in preparation for Lessee’s signage
(including without limitation patching and repairing of holes left by prior
Lessees’ signage). In addition, Lessee, at its cost, may install or place signs,
awnings, or pylon signs in or about the Premises provided that Lessee obtains
Lessor’s consent for all such exterior signs, which consent shall not be
unreasonably withheld, conditioned or delayed. Lessee shall not be required to
obtain

 

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Lessor’s consent for any promotional or advertising displays. During the first
twelve (12) months of the Term, Lessee may also display promotional banners and
awnings in and around the Premises and adjacent portions of the parking lot for
its grand opening. All signs must comply with all Applicable Requirements.

 

35.                                 Termination; Merger. Unless specifically
stated otherwise in writing by Lessor, the voluntary or other surrender of this
Lease by Lessee, the mutual termination or cancellation hereof, or a termination
hereof by Lessor for Breach by Lessee, shall automatically terminate any
sublease or lesser estate in the Premises; provided, however, that Lessor may
elect to continue any one or all existing subtenancies. Lessor’s failure within
10 days following any such event to elect to the contrary by written notice to
the holder of any such lesser interest, shall constitute Lessor’s election to
have such event constitute the termination of such interest.

 

36.                                 Consents. Except as otherwise provided
herein, wherever in this Lease the consent of a Party is required to an act by
or for the other Party, such consent shall not be unreasonably withheld or
delayed. Lessor’s actual reasonable costs and expenses (including but not
limited to architects’, attorneys’, engineers’ and other consultants’ fees)
incurred in the consideration of, or response to, a request by Lessee for any
Lessor consent, including but not limited to consents to an assignment, a
subletting or the presence or use of a Hazardous Substance, shall be paid by
Lessee upon receipt of an invoice and supporting documentation therefor.
Lessor’s consent to any act, assignment or subletting shall not constitute an
acknowledgment that no Default or Breach by Lessee of this Lease exists, nor
shall such consent be deemed a waiver of any then existing Default or Breach,
except as may be otherwise specifically stated in writing by Lessor at the time
of such consent. The failure to specify herein any particular condition to
Lessor is consent shall not preclude the imposition by Lessor at the time of
consent of such further or other conditions as are then reasonable with
reference to the particular matter for which consent is being given. In the
event that either Party disagrees with any determination made by the other
hereunder and reasonably requests the reasons for such determination, the
determining party shall furnish its reasons in writing and in reasonable detail
within 10 business days following such request.

 

37.                                 Lessee’s Options.

 

(a) Lessee shall have the right, at its sole option, at anytime after the
eighty-fourth (84th) month of the Lease Term, to terminate the Lease upon not
less than nine (9) months’ advance written notice to Lessor with a penalty equal
to five (5) months’ of then Base Rent.

 

(b) Upon expiration of the initial Term, Lessee shall have two (2) options to
extend the Lease for an additional five (5) years at 95% of fair market rental
for comparable retail projects in the area. Lessee must give Lessor at least six
(6) months’ prior written notice of its exercise of the option. The fair market
rental shall be determined by taking the average of the Lessor’s and the
Lessee’s real estate brokers and must be agreed upon in writing by Lessor and
Lessee.

 

38.                                 Quiet Possession. Subject to payment by
Lessee of the Rent and performance of all of the covenants, conditions and
provisions on Lessee’s part to be observed and performed under this Lease,
Lessee shall have quiet possession and quiet enjoyment of the Premises during
the term hereof. Lessee shall have access to the Premises seven (7) days a week,
twenty-four (24) hours a day.

 

39.                                 Options. If Lessee is granted an option, as
defined below, then the following provisions shall apply.

 

39.1                           Definition. “Option” shall mean: (a) the right to
extend the term of or renew this Lease or to extend or renew any lease that
Lessee has on other property of Lessor; (b) the right of first

 

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refusal or first offer to lease either the Premises or other property of Lessor;
(c) the right to purchase or the right of first refusal to purchase the Premises
or other property of Lessor.

 

39.2                           Options Personal To Original Lessee. Any Option
granted to Lessee in this Lease is personal to the original Lessee, and cannot
be assigned or exercised by anyone other than said original Lessee and only
while the original Lessee is in full possession of the Premises and, if
requested by Lessor, with Lessee certifying that Lessee has no intention of
thereafter assigning or subletting.

 

39.3                           Multiple Options. In the event that Lessee has
any multiple Options to extend or renew this Lease, a later Option cannot be
exercised unless the prior Options have been validly exercised.

 

39.4                           Effect of Default on Options.

 

(a)  Lessee shall have no right to exercise an Option: (i) during the period
commencing with the giving of any notice of Default and continuing until said
Default is cured, (ii) during the period of time any Rent is unpaid (without
regard to whether notice thereof is given Lessee), (iii) during the time Lessee
is in Breach of this Lease, or (iv) in the event that Lessee has been given 3 or
more notices of separate Default, whether or not the Defaults are cured, during
the 12 month period immediately preceding the exercise of the Option.

 

(b)  The period of time within which an Option may be exercised shall not be
extended or enlarged by reason of Lessee’s inability to exercise an Option
because of the provisions of Paragraph 39.4 (a).

 

(c)  An Option shall terminate and be of no further force or effect,
notwithstanding Lessee’s due and timely exercise of the Option, if, after such
exercise and prior to the commencement of the extended term, (i) Lessee fails to
pay Rent for a period of 30 days after such Rent becomes due (without any
necessity of Lessor to give notice thereof), (ii) Lessor gives to Lessee 3 or
more notices of separate Default during any 12 month period, whether or not the
Defaults are cured, or (iii) if Lessee commits a Breach of this Lease.

 

40.                                 Security Measures. Lessee hereby
acknowledges that the Rent payable to Lessor hereunder does not include the cost
of guard service or other security measures, and that Lessor shall have no
obligation whatsoever to provide same. Lessee assumes all responsibility for the
protection of the Premises, Lessee, its agents and invitees and their property
from the acts of third parties.

 

41.                                 Reservations. Lessor reserves the right:
(i) to grant, without the consent or joinder of Lessee, such easements, rights
and dedications that Lessor deems necessary, (ii) to cause the recordation of
parcel maps and restrictions, and (iii) to create and/or install new utility
raceways, so long as such easements, rights, dedications, maps, restrictions,
and utility raceways do not unreasonably interfere with the use of the Premises
by Lessee. Lessee agrees to sign any documents reasonably requested by Lessor to
effectuate such rights.

 

42.                                 Performance Under Protest. If at any time a
dispute shall arise as to any amount or sum of money to be paid by one Party to
the other under the provisions hereof, the Party against whom the obligation to
pay the money is asserted shall have the right to make payment “under protest”
and such payment shall not be regarded as a voluntary payment and there shall
survive the right on the part of said Party to institute suit for recovery of
such sum. If it shall be adjudged that there was no legal obligation on the part
of said Party to pay such sum or any part thereof, said Party shall be entitled
to recover such sum or so much thereof as it was not legally required to pay.

 

43.                                 Authority; Representations. If either Party
hereto is a corporation, trust, Limited Liability Company, partnership, or
similar entity, each individual executing this Lease on behalf of such entity
represents and warrants that he or she is duly authorized to execute and deliver
this Lease on its behalf. Each party shall, within 30 days after request,
deliver to the other party satisfactory evidence of such authority. Lessor
represents and warrants to Lessee that (i) fee title to the Project and Premises
is vested

 

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in Lessor, and, as of the date of this Lease, is subject to no defects or
encumbrances that would prevent or interfere with the Agreed Use; (ii) by
executing this Lease and by allowing Lessee to use the Premises for the Agreed
Use, Lessor is not violating and will not be violating any restrictive covenant
or agreement contained in any other lease or contract affecting Lessor or the
Premises; (iii) except as disclosed to Lessee in writing prior to Lessee’s
execution of this Lease, there is no active litigation with respect to the
Project involving other existing or prior tenants, adjacent landowners or
governmental agencies and (iv) Lessor has the authority to enter into this Lease
and its execution and delivery by Lessor has been duly authorized.

 

44.                                 Conflict. Any conflict between the printed
provisions of this Lease and the typewritten or handwritten provisions shall be
controlled by the typewritten or handwritten provisions.

 

45.                                 Offer. Preparation of this Lease by either
party or their agent and submission of same to the other Party shall not be
deemed an offer to lease to the other Party. This Lease is not intended to be
binding until executed and delivered by all Parties hereto.

 

46.                                 Amendments. This Lease may be modified only
in writing, signed by the Parties in interest at the time of the modification.
As long as they do not materially change Lessee’s obligations hereunder, Lessee
agrees to make such reasonable non-monetary modifications to this Lease as may
be reasonably required by a Lender in connection with the obtaining of normal
financing or refinancing of the Premises.

 

47.                                 Multiple Parties. If more than one person or
entity is named herein as either Lessor or Lessee, such multiple Parties shall
have joint and several responsibility to comply with the terms of this Lease.

 

48.                                 Waiver of Jury Trial. The Parties-hereby
waive their respective rights to trial by jury in any action or proceeding
involving the Property or arising out of this Agreement.

 

49.                                 Mediation and Arbitration of Disputes. An
Addendum requiring the Mediation and/or the Arbitration of all disputes between
the Parties and/or Brokers arising out of this Lease [ ] is [x] is not attached
to his Lease.

 

LESSOR AND LESSEE HAVE CAREFULLY READ AND REVIEWED THIS LEASE AND EACH TERM AND
PRQVISION CONTAINED HEREIN, AND BY THE EXECUTION OF THIS LEASE SHOW THEIR
INFORMED AND VOLUNTARY CONSENT THERETO. THE PARTIES HEREBY AGREE THAT, AT THE
TIME THIS LEASE IS EXECUTED, THE TERMS OF THIS LEASE ARE COMMERCIALLY REASONABLE
AND EFFECTUATE THE INTENT AND PURPOSE OF LESSOR AND LESSEE WITH RESPECT TO THE
PREMISES.

 

ATTENTION: NO REPRESENTATION OR RECOMMENDATION IS MADE BY THE AMERICAN
INDUSTRIAL REAL ESTATE ASSOCIATION OR BY ANY BROKER AS TO THE LEGAL SUFFICIENCY,
LEGAL EFFECT, OR TAX CONSEQUENCES OF THIS LEASE OR THE TRANSACTION TO WHICH IT
RELATES. THE PARTIES ARE URGED TO:

 

1. SEEK ADVICE OF COUNSEL AS TO THE LEGAL AND TAX CONSEQUENCES OF THIS LEASE.

 

2. RETAIN APPROPRIATE CONSULTANTS TO REVIEW AND INVESTIGATE THE CONDITION OF THE
PREMISES. SAID INVESTIGATION SHOULD INCLUDE BUT NOT BE LIMITED TO: THE POSSIBLE
PRESENCE OF HAZARDOUS SUBSTANCES, THE ZONING OF THE PREMISES, THE STRUCTURAL
INTEGRITY, THE CONDITION OF THE ROOF AND

 

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OPERATING SYSTEMS, COMPLIANCE WITH THE AMERICANS WITH DISABILITIES ACT AND THE
SUITABILITY OF THE PREMISES FOR LESSEE’S INTENDED USE.

 

WARNING: IF THE PREMISES ARE LOCATED IN A STATE OTHER THAN CALIFORNIA, CERTAIN
PROVISIONS OF THE LEASE MAY NEED TO BE REVISED TO COMPANY WITH THE LAWS OF THE
STATE IN WHICH THE PREMISES ARE LOCATED.

 

The Parties hereto have executed this Lease at the place and on the dates
specified above their respective signatures.

 

 

Executed at:

 

 

 

On:

8-12-09

 

 

 

 

By Lessor

 

New Hampshire Apartment, Inc.

 

 

 

 

 

By:

/s/ Joseph B. Ghim

 

 

 

 

Name Printed:

Joseph B. Ghim

 

 

 

 

Title:

President

 

 

 

 

 

Executed at:

 

 

 

On:

July 30, 2009

 

 

 

By Lessee:

 

 

 

 

 

By:

/s/ David Kim

 

 

 

 

Name Printed:

David Kim

 

 

 

 

Title:

Sr. Vice President

 

 

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