Exhibit
10.24

LEASE
between
 
TMT RESTON I & II, INC.,
 
as Landlord,
 

and

TALK AMERICA INC.,

as Tenant

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TABLE OF CONTENTS

1. USE AND RESTRICTIONS ON USE.
 
2. TERM.
 
3. RENT.
 
4. RENT ADJUSTMENTS.
 
5. SECURITY DEPOSIT.
 
6. ALTERATIONS.
 
7. REPAIR.
 
8. LIENS.
 
9. ASSIGNMENT AND SUBLETTING.
 
10. INDEMNIFICATION.
 
11. INSURANCE.
 
12. WAIVER OF SUBROGATION.
 
13. SERVICES AND UTILITIES.
 
14. HOLDING OVER.
 
15. SUBORDINATION.
 
16. RULES AND REGULATIONS.
 
17. REENTRY BY LANDLORD.
 
18. DEFAULT.
 
19. REMEDIES.
 

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20. TENANT’S BANKRUPTCY OR INSOLVENCY.
 
21. QUIET ENJOYMENT.
 
22. CASUALTY
 
23. EMINENT DOMAIN.
 
24. SALE BY LANDLORD.
 
25. ESTOPPEL CERTIFICATES.
 
26. SURRENDER OF PREMISES.
 
27. NOTICES.
 
28. TAXES PAYABLE BY TENANT.
 
29. INTENTIONALLY OMITTED.
 
30. DEFINED TERMS AND HEADINGS.
 
31. TENANT’S AUTHORITY.
 
32. FINANCIAL STATEMENTS AND CREDIT REPORTS.
 
33. COMMISSIONS.
 
34. TIME AND APPLICABLE LAW.
 
35. SUCCESSORS AND ASSIGNS.
 
36. ENTIRE AGREEMENT.
 
37. EXAMINATION NOT OPTION.
 
38. RECORDATION.
 
39. PARKING.
 
40. LIMITATION OF LANDLORD’S LIABILITY.
 
EXHIBIT A - FLOOR PLAN DEPICTING THE PREMISESA-1
 
EXHIBIT A-1 - SITE PLANA-1-1
 
EXHIBIT A-2 - EXPANSION SPACEA-1-2
 
EXHIBIT B - INITIAL ALTERATIONSB-
 
EXHIBIT B-1 - PROJECT SCHEDULEB-1-1
 
EXHIBIT C - COMMENCEMENT DATE MEMORANDUMC-1
 
EXHIBIT D - RULES AND REGULATIONSD-1
 
EXHIBIT E - FORM OF GUARANTYE-

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LEASE

REFERENCE PAGES

BUILDING:
Reston Plaza II
12020 Sunrise Valley Drive
Reston, VA 20191
   
LANDLORD:
TMT Reston I & II, Inc., a Delaware corporation
   
LANDLORD’S ADDRESS:
c/o RREEF
8280 Greensboro Drive, Suite 550
McLean, Virginia 22102
Attn: Patrick N. Connell, Vice President / Regional Director
 
with a copy (which shall not constitute notice) to:
Covington & Burling
1201 Pennsylvania Avenue, N.W.
Washington, D.C. 20004-2401
Attention: Robert J. Gage, Esq.
   
ADDRESS FOR RENT PAYMENT:
TMT Reston I & II, Inc.
P.O. Box 13517
Newark, NJ 07188-0517
   
LANDLORD’S REGISTERED AGENT FOR SERVICE OF PROCESS:
Commonwealth Legal Services Corporation
4701 Cox Road, Suite 301
Glen Allen, VA 23060-6802
   
LEASE REFERENCE DATE:
February 28, 2006
   
TENANT:
Talk America Inc., a Pennsylvania corporation
   
GUARANTOR
Talk America Holdings, Inc., a Delaware corporation
   
TENANT’S NOTICE ADDRESS:
     
(a) As of beginning of Term:
Premises
 
with a copy (which shall not constitute notice) to:
Talk America Inc.
6805 Route 202
New Hope, Pennsylvania 18938
Attn: Legal Department
   
(b) Prior to beginning of Term (if different):
Premises
 
with a copy (which shall not constitute notice) to:
Talk America Inc.
6805 Route 202
New Hope, Pennsylvania 18938
Attn: Legal Department
   
PREMISES IDENTIFICATION:
Suite Number 250 on the second (2nd) floor of the Building (for outline of
Premises see Exhibit A)
   
PREMISES RENTABLE AREA:
Approximately 10,019 sq. ft. (for outline of Premises see Exhibit A)
   
COMMENCEMENT DATE:
December 1, 2005
   
TERM OF LEASE:
Approximately four (4) years, zero (0) months and zero (0) days beginning on the
Commencement Date and ending on the Termination Date. The period from the
Commencement Date to the last day of the same month is the “Commencement Month.”
   
TERMINATION DATE:
November 30, 2009
   
EXTENSION OPTION
Subject to the provisions set forth in Section 2.2, Tenant shall receive an
option to extend the Term of this Lease for all or a portion of the Premises for
one (1) consecutive extension term of five (5) consecutive years
   
EXPANSION SPACE OPTION
Subject to the provisions set forth in Section 2.3, Tenant shall receive an
option to lease any remaining portion of the second (2nd) floor of the Building
that shall become vacant and available or is reasonably expected by Landlord to
become vacant and available during the first two (2) years of the initial Term
of this Lease
   
ANNUAL RENT:
Twenty six and 00/100 Dollars ($26.00) per rentable square foot per annum,
subject to an escalation of three percent (3%) per annum on each anniversary of
the Commencement Date, commencing with the first (1st) anniversary of the
Commencement Date.
   
RENT ABATEMENT (Article 3):
Subject to the provisions set forth in Articles 3 and 19 of this Lease, Tenant
shall receive an abatement during the first (1st) full calendar month of the
Term of this Lease equal to one hundred percent (100.0%) of such Monthly
Installment of the initial Annual Rent.
   

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MONTHLY INSTALLMENT OF RENT:

Lease Year
Rentable Square Footage
Annual Rent Per Square Foot
Annual Rent
Monthly Installment of Rent
1˚
10,019
$26.00
$260,494.00
$21,707.83
2
10,019
$26.78
$268,308.82
$22,359.07
3
10,019
$27.58
$276,324.02
$23,027.00
4
10,019
$28.41
$284,639.79
$23,719.98

˚ Subject to an abatement as set forth in Section 3.1.1.

BASE YEAR (EXPENSES):
January 1, 2006 to December 31, 2006 
   
BASE YEAR (INSURANCE):
January 1, 2006 to December 31, 2006
   
BASE YEAR (TAXES):
January 1, 2006 to December 31, 2006
   
BUILDING SIZE
approximately 48,886 sq. ft.
   
TENANT’S PROPORTIONATE SHARE:
20.49%
   
SECURITY DEPOSIT:
$21,707.83, subject to the provisions set forth in Section 5
   
ASSIGNMENT/SUBLETTING FEE:
$1,500.00
   
AFTER-HOURS HVAC COST:
$40.00 per hour, subject to change at any time, from time to time.
   
HOLIDAYS
New Year's Day, Memorial Day, Independence Day, Labor Day, Thanksgiving Day,
Christmas Day, subject to change at any time, from time to time.
   
REAL ESTATE BROKER DUE COMMISSION:
Studley (Virginia), Inc.
   
TENANT’S SIC CODE:
4812
   
BUILDING BUSINESS HOURS:
Monday - Friday, 8:00 a.m. - 6:00 p.m.
Saturday, 8:00 a.m. - 1:00 p.m.
   
AMORTIZATION RATE:
10%

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

[SIGNATURES CONTAINED ON NEXT PAGE]
 
 

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WITNESS:
 
 
 
 
 
 
 
 
 
By: /s/ Patricia M. Webel
Name: Patricia M. Webel     
Title: Property Manager     
LANDLORD:
 
TMT RESTON I & II, INC.,
a Delaware corporation
 
 
By: RREEF Management Company,
a Delaware corporation
 
 
By: /s/ Patrick N. Connell
Name: Patrick N. Connell  
Title: Vice President / Regional Director
Dated: 9-26-05
   
ATTEST:
 
 
 
 
 
By: /s/ Craig H. Pizer
Name: Craig H. Pizer
Title: Associate General Counsel - Assistant Secretary
 
[Corporate Seal]
TENANT:
 
TALK AMERICA INC.
a Pennsylvania corporation
 
 
By: /s/ Aloysius T. Lawn, IV
Name: Aloysius T. Lawn IV
Title: EVP- General Counsel
Dated: 9-19-05

 

 

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

1. 
     USE AND RESTRICTIONS ON USE.

 
    1.1     The Premises are to be used solely for general office purposes.
Tenant shall not do or permit anything to be done in or about the Premises which
will in any way obstruct or interfere with the lease rights of other tenants or
occupants of the Building, including, but not limited to, any exclusive lease
rights of another tenant or occupant of the Building, or injure, annoy, or
disturb them, or allow the Premises to be used for any improper, immoral,
unlawful, or objectionable purpose, or commit any waste. Tenant shall not do,
permit or suffer in, on, or about the Premises the sale of any alcoholic liquor
without the written consent of Landlord first obtained. Tenant shall comply with
all governmental laws, ordinances and regulations applicable to the use of the
Premises and its occupancy and shall promptly comply with all governmental
orders and directions for the correction, prevention and abatement of any
violations in the Building or appurtenant land, caused or permitted by, or
resulting from the specific use by, Tenant, or in or upon, or in connection
with, the Premises, all at Tenant’s sole expense. Tenant shall not do or permit
anything to be done on or about the Premises or bring or keep anything into the
Premises which will in any way increase the rate of, invalidate or prevent the
procuring of any insurance protecting against loss or damage to the Building or
any of its contents by fire or other casualty or against liability for damage to
property or injury to persons in or about the Building or any part thereof.
Landlord represents that, to the best of Landlord’s actual knowledge (defined as
the personal knowledge of Patrick N. Connell, Vice President and Regional
Director of RREEF Management Company), as of the Commencement Date, the common
areas of the Building and appurtenant land are in compliance with all applicable
laws.
 
    1.2  Tenant shall not, and shall not direct, suffer or permit any of its
agents, contractors, employees, licensees or invitees (collectively, the “Tenant
Entities”) to at any time handle, use, manufacture, store or dispose of in or
about the Premises or the Building any (collectively “Hazardous Materials”)
flammables, explosives, radioactive materials, hazardous wastes or materials,
toxic wastes or materials, or other similar substances, petroleum products or
derivatives or any substance subject to regulation by or under any federal,
state and local laws and ordinances relating to the protection of the
environment or the keeping, use or disposition of environmentally hazardous
materials, substances, or wastes, presently in effect or hereafter adopted, all
amendments to any of them, and all rules and regulations issued pursuant to any
of such laws or ordinances (collectively “Environmental Laws”), nor shall Tenant
suffer or permit any Hazardous Materials to be used in any manner not fully in
compliance with all Environmental Laws, in the Premises or the Building and
appurtenant land or allow the environment to become contaminated with any
Hazardous Materials. Notwithstanding the foregoing, Tenant may handle, store,
use or dispose of products containing small quantities of Hazardous Materials
(such as aerosol cans containing insecticides, toner for copiers, paints, paint
remover and the like) to the extent customary and necessary for the use of the
Premises for general office purposes; provided that Tenant shall always handle,
store, use, and dispose of any such Hazardous Materials in a safe and lawful
manner and never allow such Hazardous Materials to contaminate the Premises,
Building and appurtenant land or the environment. Tenant shall protect, defend,
indemnify and hold each and all of the Landlord Entities (as defined in Article
30) harmless from and against any and all loss, claims, liability or costs
(including court costs and attorney’s fees) incurred by reason of any actual or
asserted failure of Tenant to fully comply with all applicable Environmental
Laws, or the presence, handling, use or disposition in or from the Premises of
any Hazardous Materials by Tenant or any Tenant Entity (even though permissible
under all applicable Environmental Laws or the provisions of this Lease), or by
reason of any actual or asserted failure of Tenant to keep, observe, or perform
any provision of this Section 1.2.
 

2. 
     TERM.

 
    2.1   The Term of this Lease shall begin on the Commencement Date. The
parties hereby acknowledge that Talk America Holdings, Inc. (“Parent”), a
Delaware corporation, is currently in possession of the Premises pursuant to
that certain lease agreement dated April 28, 2000 by and between Landlord, as
successor-in-interest to Reston Plaza I & II, LLC, and Parent, as
successor-in-interest to Talk.com, as amended by that certain First Amendment to
Lease dated May 6, 2004 and that certain Second Amendment to Lease dated , 2004
(as amended, the “Prior Lease”) and that Tenant is the wholly-owned subsidiary
of Parent. The parties also acknowledge that Tenant is currently in possession
of approximately 1,136 rentable square feet on the first (1st) floor of that
certain building located at 12030 Sunrise Valley Drive in Reston, Virginia
pursuant to the terms of that certain lease agreement dated October 28, 2004, by
and between Landlord and Tenant (the “Reston I Lease”). Tenant acknowledges that
it enters into this Lease without any representations or warranties by the
Landlord, or anyone acting or purporting to act on behalf of Landlord, as to the
present or future condition of the Premises or the appurtenances thereto or any
improvements therein or of the Building, except as specifically set forth in
this Lease. It is further agreed that Tenant does and will accept the Premises
“AS IS” in their present condition as of the date hereof and the Landlord has no
obligation to perform any work therein. Notwithstanding any provision in this
Lease to the contrary, if the Term has not commenced within one (1) year after
the date of this Lease, this Lease shall automatically terminate on the first
(1st) anniversary of the date hereof. The sole purpose of the preceding sentence
is to avoid any possible interpretation that this Lease violates the Rule
Against Perpetuities or other rule of law against restraints on alienation.
 

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        2.1.1    The parties agree that the Prior Lease shall terminate pursuant
to a separate agreement by and between Landlord and Tenant (“Prior Lease
Termination Agreement”). The Prior Lease, the Prior Lease Termination Agreement
and the Reston I Lease shall constitute the “Related Agreements.” Any Event of
Default as defined in the Related Agreements existing as of the Commencement
Date of this Lease shall constitute an immediate Event of Default (as defined
hereinafter), to which no notice by Landlord to Tenant shall be required. Any
default under any of the Related Agreements shall constitute a default
hereunder, as further set forth in Section 18.1.2.
 
    2.2   Provided that: (i) Tenant is in physical possession and actual
occupancy of the Premises and no Event of Default exists at the time of the
exercise of such option or arises subsequent thereto, and no event exists which
by notice and/or the passage of time would constitute an Event of Default if not
cured within the applicable cure period provided under this Lease; and (ii)
Tenant has not sublet or assigned any of its rights, title, and interest in and
to this Lease, Tenant shall have the option to extend this Lease with respect to
all or a portion of the Premises for one (1) consecutive extension term of five
(5) consecutive years, provided Tenant notifies Landlord in writing of its
exercise of such option not sooner than twelve (12) months nor later than nine
(9) months prior to the Termination Date. Annual Rent during such extension term
shall be at one hundred percent (100%) of the fair market rate, including market
concessions, as determined by the mutual agreement of Landlord and Tenant, and
provided that Tenant shall post an increase in its Security Deposit which is
commensurate with such new Annual Rent. Such Annual Rent for the extension term
shall escalate at the fair market escalation rate as determined by the mutual
agreement of Landlord and Tenant, provided that in no event shall such Annual
Rent escalate at less than the escalation rate of three (3%) per annum. All
other provisions of this Lease shall remain the same during the extension term,
except that Tenant shall have no further extension option and the Base Year
shall be the first (1st) full calendar year of the extension term. Should
Landlord and Tenant be unable for any reason to agree upon a new Annual Rent
and/or escalation rate within forty-five (45) days after Tenant’s exercise of
this option, then the Annual Rent and/or escalation rate, as applicable, shall,
at Tenant’s sole option and discretion, be determined by appraisal by a board of
three (3) real estate brokers, one of whom shall be named by Landlord, one by
Tenant, and the two so appointed shall select a third. Such brokers shall be
members of the Greater Washington Association of Commercial Realtors or any
successor thereto, licensed in the Commonwealth of Virginia, and each shall have
not less than ten (10) years’ experience in the field of commercial office
leasing in the Washington, D.C. metropolitan area. Each shall be recognized as
being ethical and reputable within its field. Landlord and Tenant agree to make
their appointments promptly within ten (10) business days after the expiration
of the forty-five (45) day period, and the two brokers shall promptly select a
third broker within fifteen (15) days thereafter. Each broker shall, within
thirty (30) days after selection of the third broker, submit its determination
of the Annual Rent and/or escalation rate, as applicable, and the Annual Rent
and/or escalation rate, as applicable, shall be deemed to be the rent and/or
escalation rate, as applicable, determined by the third broker, unless it is
higher than the higher of the two values determined by the first two brokers, in
which event the higher of the first two appraisals shall be the Annual Rent
and/or escalation rate, as applicable, or unless it is lower than the lower of
the two values determined by the first two brokers, in which event the lower of
the first two appraisals shall be the Annual Rent or escalation rate, as
applicable. In arriving at its rental rate determinations, each broker shall
consider and analyze all material components of the Lease, and review terms
being offered to prospective office tenants for comparable space in comparable
office buildings and locations in the northern Virginia metropolitan area for
leases commencing on or about the time of commencement of the extension period.
In no event shall the escalation rate be less than three percent (3%) per annum.
Landlord and Tenant shall each pay the fee of the broker selected by it and they
shall share equally the payment of the fee of the third broker.
 

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    2.3  Provided that: (i) Tenant is in physical possession and actual
occupancy of the Premises and no Event of Default exists at the time of the
exercise of such option or arises subsequent thereto, and no event exists or
arises subsequent thereto which by notice and/or the passage of time would
constitute an Event of Default if not cured within the applicable cure period
provided under this Lease; and (ii) Tenant has not sublet or assigned any of its
rights, title, and interest in and to this Lease, and subject to any
pre-existing rights granted to other tenants, if at any time during the first
two (2) years of the initial Term of this Lease any remaining portion of the
second (2nd) floor of the Building (each such portion, an “Expansion Space”), as
shown on Exhibit A-2, attached hereto, shall become vacant and available or is
reasonably expected by Landlord to become vacant and available, Landlord shall
notify Tenant of the availability of such Expansion Space in writing and
Landlord shall provide Tenant with a copy of the proposed terms and conditions
(“Proposed Expansion Space Terms”) under which Landlord shall offer such
Expansion Space, including the Annual Rent and the date of anticipated delivery
of possession. Tenant shall have ten (10) days from the date of Landlord’s
notice to Tenant to advise Landlord in writing that Tenant accepts such
Expansion Space (“Expansion Space Election Period”) on the Proposed Expansion
Space Terms, in its “AS IS” condition, with all Building systems servicing such
Expansion Space in working condition at Landlord’s reasonable expense, and
agrees that it shall become a part of the Premises. Tenant shall be solely
responsible for all repairs, improvements, alterations, fixtures and furnishings
to be made or installed in Expansion Space. Subject to the terms and conditions
of Article 6 of this Lease, Tenant shall obtain Landlord’s prior written
approval of Tenant’s drawings, plans and specifications before commencing
construction of improvements. Tenant’s obligation to commence payment of Annual
Rent for such Expansion Space shall occur on the day the Expansion Space is
substantially completed by Tenant, but in no case longer than the earlier to
occur of (i) sixty (60) days from the initiation of the construction of
improvements or (ii) sixty (60) days from the date of delivery of possession by
Landlord to Tenant. If Tenant shall not so elect to lease Expansion Space within
the Expansion Space Election Period, Landlord may lease such Expansion Space to
a third party. In the event Landlord and Tenant agree on lease terms pursuant to
this Section 2.3, the parties shall enter into an amendment modifying this Lease
to set forth such lease terms within thirty (30) days of the parties’ agreement;
provided, however, if either party shall fail to do so after Tenant shall have
exercised its option for the Expansion Space, they shall each be bound by their
mutual agreement as to the Annual Rent and additional rent. Annual Rent for such
Expansion Space shall be at one hundred percent (100%) of the fair market rate,
including market concessions provided to Tenant pursuant to this Lease, as
determined by the mutual agreement of Landlord and Tenant, provided that Tenant
shall post an increase in its Security Deposit which is commensurate with the
additional Annual Rent of such Expansion Space. Such Annual Rent for the
Expansion Space shall escalate at the fair market escalation rate as determined
by the mutual agreement of Landlord and Tenant, provided that in no event shall
such Annual Rent escalate at less than the escalation rate of three (3%) per
annum. All other provisions of this Lease shall remain the same with respect to
the Expansion Space. Should Landlord and Tenant be unable for any reason to
agree upon the Annual Rent and/or escalation rate within forty-five (45) days
after Tenant’s exercise of this option, then the Annual Rent and/or escalation
rate, as applicable, shall be determined by appraisal by a board of three (3)
real estate brokers, one of whom shall be named by Landlord, one by Tenant, and
the two so appointed shall select a third. Such brokers shall be members of the
Greater Washington Association of Commercial Realtors or any successor thereto,
licensed in the Commonwealth of Virginia, and each shall have not less than ten
(10) years’ experience in the field of commercial office leasing in the
Washington, D.C. metropolitan area. Each shall be recognized as being ethical
and reputable within its field. Landlord and Tenant agree to make their
appointments promptly within ten (10) business days after the expiration of the
forty-five (45) day period, and the two brokers shall promptly select a third
broker within fifteen (15) days thereafter. Each broker shall, within thirty
(30) days after selection of the third broker, submit its determination of the
Annual Rent and/or escalation rate for such Expansion Space, as applicable and
the Annual Rent and/or escalation rate for such Expansion Space, as applicable,
shall be deemed to be the rent and/or escalation rate, as applicable, determined
by the third broker, unless it is higher than the higher of the two values
determined by the first two brokers, in which event the higher of the first two
appraisals shall be the Annual Rent and/or escalation rate, as applicable, or
unless it is lower than the lower of the two values determined by the first two
brokers, in which event the lower of the first two appraisals shall be the
Annual Rent or escalation rate, as applicable. In arriving at its rental rate
determinations, each broker shall consider and analyze all material components
of the Lease, and review terms being offered to prospective office tenants for
comparable space in comparable office buildings and locations in the northern
Virginia metropolitan area for leases commencing on or about the time of
commencement of the extension period. In no event shall the escalation rate be
less than three percent (3%) per annum. Landlord and Tenant shall each pay the
fee of the broker selected by it and they shall share equally the payment of the
fee of the third broker. Notwithstanding anything contained herein to the
contrary, Tenant shall have no right to lease from Landlord and Landlord shall
have no obligation to lease to Tenant any such Expansion Space which shall
become vacant and available or is reasonably expected by Landlord to become
vacant and available after the first two (2) years of the initial Term of this
Lease.
 

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3. 
     RENT.

 
    3.1  Tenant agrees to pay to Landlord the Annual Rent in effect from time to
time by paying the Monthly Installment of Rent then in effect on or before the
first day of each full calendar month during the Term, except that the first
full month’s rent shall be paid upon the execution of this Lease. The Monthly
Installment of Rent in effect at any time shall be one-twelfth (1/12) of the
Annual Rent in effect at such time. Rent for any period during the Term which is
less than a full month shall be a prorated portion of the Monthly Installment of
Rent based upon the number of days in such month. Said rent shall be paid to
Landlord, without deduction or offset and without notice or demand, at the Rent
Payment Address, as set forth on the Reference Pages, or to such other person or
at such other place as Landlord may from time to time designate in writing. If
an Event of Default occurs, Landlord may require by notice to Tenant that all
subsequent rent payments be made by an automatic payment from Tenant’s bank
account to Landlord’s account, without cost to Landlord. Tenant must implement
such automatic payment system prior to the next scheduled rent payment or within
ten (10) days after Landlord’s notice, whichever is later. Unless specified in
this Lease to the contrary, all amounts and sums payable by Tenant to Landlord
pursuant to this Lease shall be deemed “additional rent”.
 
        3.1.1  Notwithstanding the foregoing, provided that there shall not
exist any Event of Default, and subject to the provisions of Section 19.3 below,
the Monthly Installment of Annual Rent due for the first (1st) full calendar
month following the Commencement Date shall be abated. Nothing in this Section
3.1.1, however, shall be interpreted to except or excuse Tenant from any
additional rent or other amounts due under this Lease or the Prior Lease to
Landlord.
 
    3.2  Tenant recognizes that late payment of any rent or other sum due under
this Lease will result in administrative expense to Landlord, the extent of
which additional expense is extremely difficult and economically impractical to
ascertain. Tenant therefore agrees that if rent or any other sum is not paid
when due and payable pursuant to this Lease, a late charge shall be imposed in
an amount equal to the greater of: (a) Fifty Dollars ($50.00), or (b) six
percent (6%) of the unpaid rent or other payment. The amount of the late charge
to be paid by Tenant shall be reassessed and added to Tenant’s obligation for
each successive month until paid. The provisions of this Section 3.2 in no way
relieve Tenant of the obligation to pay rent or other payments on or before the
date on which they are due, nor do the terms of this Section 3.2 in any way
affect Landlord’s remedies pursuant to Article 19 of this Lease in the event
said rent or other payment is unpaid after date due.
 
    3.3  Notwithstanding anything to the contrary contained herein, if the
Commencement Month is not a full calendar month, such Commencement Month shall
be deemed for all purposes of this Lease to be part of the First Lease Year and
Tenant shall pay additional Annual Rent for such Commencement Month calculated
on a per diem basis at the Annual Rental Rate for the First Lease Year.
 

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4. 
    RENT ADJUSTMENTS.

 
    4.1  For the purpose of this Article 4, the following terms are defined as
follows:
 
        4.1.1   Lease Year: Each consecutive twelve (12) month period falling
partly or wholly within the Term; provided, however, if the Commencement Month
is not a full calendar month, then the first Lease Year shall consist of the
Commencement Month and the subsequent twelve (12) consecutive month period.
 
        4.1.2   Expenses: All costs of operation, maintenance, repair,
replacement and management of the Building (including (A) the amount of any
credits which Landlord may grant to particular tenants of the Building in lieu
of providing any standard services or paying any standard costs described in
this Section 4.1.1 for similar tenants and (B) the portion of shared expenses
allocable to the Building as provided for in the final sentence of this Section
4.1.2), as determined in accordance with generally accepted accounting
principles, including the following costs by way of illustration, but not
limitation: water and sewer charges; utility costs, including, but not limited
to, the cost of heat, light, power, steam, gas; waste disposal; the cost of
janitorial services; the cost of access control and monitoring services
(including any central station signaling system); costs of cleaning, repairing,
replacing and maintaining the common areas, including parking and landscaping,
window cleaning costs; labor costs; costs and expenses of managing the Building
including management and/or administrative fees; air conditioning maintenance
costs; elevator maintenance fees and supplies; material costs; equipment costs
including the cost of maintenance, repair and service agreements and rental and
leasing costs; purchase costs of equipment; current rental and leasing costs of
items which would be capital items if purchased; tool costs; licenses, permits
and inspection fees; wages and salaries; employee benefits and payroll taxes;
accounting and legal fees; any sales, use or service taxes incurred in
connection therewith. In addition, Landlord shall be entitled to recover, as
additional rent (which, along with any other capital expenditures constituting
Expenses, Landlord may either include in Expenses or cause to be billed to
Tenant along with Expenses and Taxes but as a separate item), Tenant’s
Proportionate Share of: (i) an allocable portion of the cost of capital
improvement items which are reasonably calculated to reduce operating expenses;
(ii) the cost of fire sprinklers and suppression systems and other life safety
systems; and (iii) other capital expenses which are required under any
governmental laws, regulations or ordinances which were not applicable to the
Building at the time it was constructed; but the costs described in this
sentence shall be amortized over the reasonable life of such expenditures in
accordance with such reasonable life and amortization schedules as shall be
determined by Landlord in accordance with generally accepted accounting
principles, with interest on the unamortized amount at one percent (1%) in
excess of the Wall Street Journal prime lending rate announced from time to
time. Expenses shall not include Taxes, Insurance Costs, depreciation or
amortization of the Building or equipment in the Building except as provided
herein, loan principal payments, costs of alterations of tenants’ premises,
leasing commissions, interest expenses on long-term borrowings or advertising
costs. If any Expenses are shared jointly between or among the Building and
another building, such as, but not limited to, Reston Plaza I, such costs shall
be allocated proportionately between or among such buildings based upon the
rentable square footage of each building, or such other equitable manner as
Landlord shall deem appropriate.
 

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        Notwithstanding anything to the contrary, Expenses shall not include
Taxes, Insurance Costs, depreciation or amortization of the Building or
equipment in the Building except as provided herein, loan principal payments,
costs of alterations of tenants’ premises, leasing commissions; interest
expenses on long-term borrowings; advertising costs; wages and salaries for
off-site employees and employees at the Building above the level of district
manager; costs of repairs, restoration, replacements or other work occasioned by
(1) fire, windstorm or other casualty of a customarily insurable nature (whether
such destruction be total or partial) and either (aa) payable (whether paid or
not) by insurance required to be carried by Landlord under this Lease, or (bb)
otherwise payable (whether paid or not) by insurance then in effect obtained by
Landlord, (2) the exercise by governmental authorities of the right of eminent
domain, whether such taking be total or partial; (3) the gross negligence or
intentional tort of Landlord, or any subsidiary or affiliate of Landlord, or any
representative, employee or agent of same, or (4) the act of any other tenant in
the Building, or any other tenant’s agents, employees, licensees or invitees to
the extent Landlord has the right to recover and actually recovers the
applicable cost from such person; attorneys’ fees, costs, disbursements and
other expenses incurred in connection with negotiations for leases with tenants,
other occupants, or prospective tenants or other occupants of the Building, or
similar costs incurred in connection with disputes with tenants, other
occupants, or prospective tenants; allowances, concessions and other costs and
expenses incurred in completing fixturing, furnishing, renovating or otherwise
improving, decorating or redecorating space for tenants (including Tenant),
prospective tenants or other occupants and prospective occupants of the Building
or vacant, leasable space in the Building; costs of the initial construction of
the Building; deductions for depreciation of the original Building when
initially constructed; costs of expenses relating to another tenant’s or
occupant’s space which were in excess of the Building standard services then
being provided by Landlord to all tenants or other occupants in the Building,
whether or not such other tenant or occupant is actually charged therefor by
Landlord; payments of rent made on any debt payments made under any ground or
underlying lease or leases, except to the extent that a portion of such rental
payments is reasonably allocable to ad valorem/real estate taxes and increased
property values as a result of such leases; except as real estate taxes may be
increased due to a re-assessment of the Building upon any of such events, costs
incurred in connection with the sale, financing, refinancing, mortgaging,
selling or change of ownership of the Building, including brokerage commissions,
attorneys’ and accountants’ fees, closing costs, title insurance premiums,
transfer and recordation taxes as a result of such action, and interest charges;
costs, fines, interest, penalties, legal fees or costs of litigation incurred
due to the late payments of taxes, utility bills and other costs incurred by
Landlord’s failure to make such payments when due; costs incurred by Landlord
for trustee’s fees, partnership organizational expenses and accounting fees
except accounting fees relating solely to the ownership and operation of the
Building (exclusive of the incremental accounting fees to the extent incurred
separately in reporting operating results to the Building owners or lenders);
any compensation paid to clerks, attendants or other persons in commercial
concessions operated by Landlord or in the parking garage of the Building;
Landlord’s income and franchise taxes (other than those business taxes which
relate solely to the operation of the Building); all amounts which would
otherwise be included in operating expenses which are paid to any affiliate or
subsidiaries of Landlord, to the extent the costs of such services exceed the
competitive rates for similar services of comparable quality; costs or expenses
of utilities directly metered to tenants of the Building and payable separately
by such tenants; moving expense costs of tenants of the Building to the extent
not provided by Landlord (i) to Tenant and (ii) generally to other initial
tenants of the Building; advertising and promotional costs associated with the
leasing of the Building; costs incurred to correct violations by Landlord of any
law, rule, order or regulation which was in effect as of the Commencement Date;
electric power costs for which any tenant directly contracts with the local
public service company; and management fees in excess of fair market management
fees.
 
        4.1.3  Taxes: Real estate taxes and any other taxes, charges and
assessments which are levied with respect to the Building or the land
appurtenant to the Building, or with respect to any improvements, fixtures and
equipment or other property of Landlord, real or personal, located in the
Building and used in connection with the operation of the Building and said
land, any payments to any ground lessor in reimbursement of tax payments made by
such lessor; and all fees, expenses and costs incurred by Landlord in
investigating, protesting, contesting or in any way seeking to reduce or avoid
increase in any assessments, levies or the tax rate pertaining to any Taxes to
be paid by Landlord in any calendar year. Taxes shall not include any corporate
franchise, or estate, inheritance or net income tax, or tax imposed upon any
transfer by Landlord of its interest in this Lease or the Building or any taxes
to be paid by Tenant pursuant to Article 28. If any Taxes are shared jointly
between or among the Building and another building, such as, but not limited to,
Reston Plaza I, such costs shall be allocated proportionately between or among
such buildings based upon the rentable square footage of each building, or such
other equitable manner as Landlord shall deem appropriate.
 

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        4.1.4  Insurance Costs: Any and all insurance charges of or relating to
all insurance policies and endorsements deemed by Landlord to be reasonably
necessary or desirable and relating in any manner to the protection,
preservation, or operation of the Building or any part thereof. If any Insurance
Costs are shared jointly between or among the Building and another building,
such as, but not limited to, Reston Plaza I, such costs shall be allocated
proportionately between or among such buildings based upon the rentable square
footage of each building, or such other equitable manner as Landlord shall deem
appropriate.
 
    4.2  If in any calendar year, (i) Expenses paid or incurred shall exceed
Expenses paid or incurred in the Base Year (Expenses) and/or (ii) Taxes paid or
incurred by Landlord shall exceed the amount of such Taxes which became due and
payable in the Base Year (Taxes), and/or (iii) Insurance Costs paid or incurred
by Landlord shall exceed the amount of such Insurance Costs which became due and
payable in the Base Year (Insurance Costs), Tenant shall pay as additional rent
for such calendar year Tenant’s Proportionate Share of each such excess amount.
 
    4.3  The annual determination of Expenses and Insurance Costs shall be made
by Landlord and shall be binding upon Landlord and Tenant, subject to the
provisions of this Section 4.3. During the Term, Tenant may review, at Tenant’s
sole cost and expense, the books and records supporting such determination in an
office of Landlord, or Landlord’s agent, during normal business hours, upon
giving Landlord five (5) days advance written notice within sixty (60) days
after receipt of such determination, but in no event more often than once in any
one (1) year period, subject to execution of a confidentiality agreement
acceptable to Landlord, and provided that if Tenant utilizes an independent
accountant to perform such review it shall be one of national standing which is
reasonably acceptable to Landlord, is not compensated on a contingency basis and
is also subject to such confidentiality agreement. If Tenant fails to object to
Landlord’s determination of Expenses and Insurance Costs within ninety (90) days
after receipt, or if any such objection fails to state with specificity the
reason for the objection, Tenant shall be deemed to have approved such
determination and shall have no further right to object to or contest such
determination. In the event that during all or any portion of any calendar year
or Base Year, the Building is not fully rented and occupied Landlord shall make
an appropriate adjustment in occupancy-related Expenses for such year for the
purpose of avoiding distortion of the amount of such Expenses to be attributed
to Tenant by reason of variation in total occupancy of the Building, by
employing consistent and sound accounting and management principles to determine
Expenses that would have been paid or incurred by Landlord had the Building been
at least ninety-five percent (95%) rented and occupied, and the amount so
determined shall be deemed to have been Expenses for such calendar year.
 
    4.4  Prior to the actual determination thereof for a calendar year, Landlord
may from time to time reasonably estimate Tenant’s liability for Expenses,
Insurance Costs and/or Taxes under Sections 4.1, Section 6.3 and Article 28 for
the calendar year or portion thereof. Landlord will give Tenant written
notification of the amount of such estimate and Tenant agrees that it will pay,
by increase of its Monthly Installments of Rent due in such calendar year,
additional rent in the amount of such estimate. Any such increased rate of
Monthly Installments of Rent pursuant to this Section 4.4 shall remain in effect
until further written notification to Tenant pursuant hereto.
 

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    4.5  When the above mentioned actual determination of Tenant’s liability for
Expenses, Insurance Costs and/or Taxes is made for any calendar year and when
Tenant is so notified in writing, then:
 
        4.5.1  If the total additional rent Tenant actually paid pursuant to
Section 4.3 on account of Expenses, Insurance Costs and/or Taxes for the
calendar year is less than Tenant’s liability for Expenses, Insurance Costs
and/or Taxes, then Tenant shall pay such deficiency to Landlord as additional
rent in one lump sum within thirty (30) days of receipt of Landlord’s bill
therefor; and
 
        4.5.2  If the total additional rent Tenant actually paid pursuant to
Section 4.3 on account of Expenses, Insurance Costs and/or Taxes for the
calendar year is more than Tenant’s liability for Expenses, Insurance Costs
and/or Taxes, then Landlord shall credit the difference against the then next
due payments to be made by Tenant under this Article 4, or, if the Lease has
terminated, refund the difference in cash. Tenant shall not be entitled to a
credit by reason of actual Expenses and/or Taxes and/or Insurance Costs in any
calendar year being less than Expenses and/or Taxes and/or Insurance Costs in
the Base Year (Expenses and/or Taxes and/or Insurance).
 
    4.6  If the Commencement Date is other than January 1 or if the Termination
Date is other than December 31, Tenant’s liability for Expenses, Insurance Costs
and Taxes for the calendar year in which said Date occurs shall be prorated
based upon a three hundred sixty-five (365) day year. Tenant’s obligation to pay
Tenant’s Proportionate Share of any unpaid Expenses, Insurance Costs, and Taxes
which are otherwise due and payable under this Lease shall survive the
expiration or earlier termination of the Term.
 

5 
    SECURITY DEPOSIT. 

 
    5.1  Tenant shall deposit the Security Deposit with Landlord upon the
execution of this Lease. Notwithstanding the foregoing, Landlord and Tenant
acknowledge and agree that Parent previously has deposited a security deposit
with respect to the Premises under the Prior Lease in the amount of Forty
Thousand Nine Hundred Fifty and 50/100 Dollars ($40,950.50) (the “Prior Lease
Security Deposit”). Landlord and Tenant acknowledge and agree that, in
accordance with the terms and conditions of the Prior Lease Termination
Agreement, Landlord shall continue to hold a portion of such Prior Lease
Security Deposit equal to the Security Deposit hereunder and that, subject to
Landlord’s right to apply any or all of such Prior Lease Security Deposit
pursuant to the terms of the Prior Lease, Landlord shall refund the remaining
balance, if any, of the Prior Lease Security Deposit to Parent on or before
December 31, 2005. The Security Deposit shall be held by Landlord as security
for the faithful performance by Tenant of all the terms, covenants and
conditions of this Lease to be kept and performed by Tenant and not as an
advance rental deposit or as a measure of Landlord’s damage in case of Tenant’s
default. If Tenant defaults with respect to any provision of this Lease,
Landlord may, after the applicable cure period, use any part of the Security
Deposit for the payment of any rent or any other sum in default, or for the
payment of any amount which Landlord may spend or become obligated to spend by
reason of Tenant’s default, or to compensate Landlord for any other loss or
damage which Landlord may suffer by reason of Tenant’s default. If any portion
is so used, Tenant shall within ten (10) days after written demand therefor,
deposit with Landlord an amount sufficient to restore the Security Deposit to
its original amount and Tenant’s failure to do so shall be a material breach of
this Lease. Except to such extent, if any, as shall be required by law, Landlord
shall not be required to keep the Security Deposit separate from its general
funds, and Tenant shall not be entitled to interest on such deposit. Provided
that Tenant shall fully and faithfully perform every provision of this Lease to
be performed by it, the Security Deposit or any balance thereof shall be
returned to Tenant at such time after termination of this Lease when Landlord
shall have determined that all of Tenant’s obligations under this Lease have
been fulfilled, but in any event no later than sixty (60) days after the
expiration of this Lease.
 

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    5.2  As additional security for the faithful performance by Tenant of all
covenants, conditions and agreements of this Lease, Parent, (“Guarantor”) has
executed and delivered to Landlord the Continuing Lease Guaranty (the
“Guaranty”), in the form attached hereto as Exhibit E, unconditionally
guaranteeing to Landlord the due and punctual payment and performance by Tenant
of all of Tenant’s obligations hereunder for the time period and as otherwise
more particularly set forth in the Guaranty. No right or remedy available to
Landlord under the Guaranty or this Lease shall extinguish any other right to
which Landlord may be entitled. In furtherance of the foregoing, it is
understood that in the event Tenant fails to perform any of its obligations
hereunder, any amounts recovered by Landlord under the Guaranty shall not be
deemed liquidated damages. Landlord may apply such sums to reduce Landlord’s
damages and such application of funds shall not preclude Landlord from
recovering from Tenant or the Guarantor jointly and severally all additional
damages incurred by Landlord by reason of Tenant’s failure to perform hereunder.
 

6 
    ALTERATIONS.

 
    6.1  Except for those, if any, specifically provided for in Exhibit B to
this Lease, Tenant shall not make or suffer to be made any alterations,
additions, or improvements, including, but not limited to, the attachment of any
fixtures or equipment in, on, or to the Premises or any part thereof or the
making of any improvements as required by Article 7, without the prior written
consent of Landlord. When applying for such consent, Tenant shall, if requested
by Landlord, furnish complete plans and specifications for such alterations,
additions and improvements. Landlord’s consent shall not be unreasonably
withheld, conditioned or delayed with respect to alterations which (i) are not
structural in nature, (ii) are not visible from the exterior of the Building,
(iii) do not materially affect or require modification of the Building’s
electrical, mechanical, plumbing, HVAC or other systems, (iv) will not interfere
with the use and occupancy of any other portion of the Building by any other
tenant or their invitees; (v) do not and will not, whether alone or taken
together with other improvements, require the construction of any other
improvements or alterations in other tenant’s space or the Common Areas; and
(vi) in aggregate do not cost more than $2.50 per rentable square foot of that
portion of the Premises affected by the alterations in question.
 
    6.2  In the event Landlord consents to the making of any such alteration,
addition or improvement by Tenant, the same shall be made by using a contractor
reasonably approved by Landlord, at Tenant’s sole cost and expense. If Tenant
shall employ any contractor and such contractor or any subcontractor of such
contractor shall employ any non-union labor or supplier, Tenant shall be
responsible for and hold Landlord harmless from any and all delays, damages and
extra costs suffered by Landlord as a result of any dispute with any labor
unions concerning the wage, hours, terms or conditions of the employment of any
such labor. In the event that Tenant requests and Landlord provides supervisory
services to Tenant in connection with such work, Landlord may charge Tenant an
administrative fee not to exceed five percent (5%) of the cost of such work to
cover its overhead as it relates to such proposed work. Furthermore, Tenant
shall reimburse to Landlord any third-party costs actually incurred by Landlord
in connection with the proposed work and the design thereof (including review of
such proposed work and design), with all such amounts being due ten (10) days
after Landlord’s demand, which will be submitted with reasonable supporting
information.
 

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    6.3  All alterations, additions or improvements proposed by Tenant shall be
constructed in accordance with all government laws, ordinances, rules and
regulations, using Building standard materials where applicable, and Tenant
shall, prior to construction, provide the additional insurance required under
Article 11 in such case, and also all such assurances to Landlord as Landlord
shall reasonably require to assure payment of the costs thereof, including but
not limited to, notices of non-responsibility, waivers of lien, surety company
performance bonds and funded construction escrows and to protect Landlord and
the Building and appurtenant land against any loss from any mechanic’s,
materialmen’s or other liens. Tenant shall pay in addition to any sums due
pursuant to Article 4, any increase in real estate taxes attributable to any
such alteration, addition or improvement for so long, during the Term, as such
increase is ascertainable; at Landlord’s election said sums shall be paid in the
same way as sums due under Article 4. Landlord may, as a condition to its
consent to any particular alterations or improvements, require Tenant to deposit
with Landlord the amount reasonably estimated by Landlord as sufficient to cover
the cost of removing such alterations or improvements and restoring the
Premises, to the extent required under Section 26.2.
 

7 
    REPAIR.

 
    7.1  Landlord shall have no obligation to alter, remodel, improve, repair,
decorate or paint the Premises, except as specified in Exhibit B if attached to
this Lease and except that Landlord shall repair and maintain the structural
portions of the Building, including the basic plumbing, air conditioning,
heating and electrical systems installed or furnished by Landlord. By taking
possession of the Premises, Tenant accepts them as being in good order,
condition and repair and in the condition in which Landlord is obligated to
deliver them. It is hereby understood and agreed that no representations
respecting the condition of the Premises or the Building have been made by
Landlord to Tenant, except as specifically set forth in this Lease.
 
    7.2  Tenant shall, at all times during the Term, keep the Premises in good
condition and repair excepting damage by fire, or other casualty, and in
compliance with all applicable governmental laws, ordinances and regulations,
promptly complying with all governmental orders and directives for the
correction, prevention and abatement of any violations or nuisances in or upon,
or connected with, the Premises, all at Tenant’s sole expense.
 
    7.3  Landlord shall not be liable for any failure to make any repairs or to
perform any maintenance unless such failure shall persist for an unreasonable
time after written notice of the need of such repairs or maintenance is given to
Landlord by Tenant.
 
    7.4  Except as provided in Article 22, there shall be no abatement of rent
and no liability of Landlord by reason of any injury to or interference with
Tenant’s business arising from the making of any repairs, alterations or
improvements in or to any portion of the Building or the Premises or to
fixtures, appurtenances and equipment in the Building. Except to the extent, if
any, prohibited by law, Tenant waives the right to make repairs at Landlord’s
expense under any law, statute or ordinance now or hereafter in effect.
 

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8 
    LIENS. 

 
    8.1  Tenant shall keep the Premises, the Building and appurtenant land and
Tenant’s leasehold interest in the Premises free from any liens arising out of
any services, work or materials performed, furnished, or contracted for by
Tenant, or obligations incurred by Tenant. In the event that Tenant fails,
within ten (10) days following the imposition of any such lien, to either cause
the same to be released of record or provide Landlord with insurance against the
same issued by a major title insurance company or such other protection against
the same as Landlord shall accept (such failure to constitute an Event of
Default), Landlord shall have the right to cause the same to be released by such
means as it shall deem proper, including payment of the claim giving rise to
such lien. All such sums paid by Landlord and all expenses incurred by it in
connection therewith shall be payable to it by Tenant within five (5) days
Landlord’s demand .
 

9 
    ASSIGNMENT AND SUBLETTING.

 
    9.1  Tenant shall not have the right to assign or pledge this Lease or to
sublet the whole or any part of the Premises whether voluntarily or by operation
of law, or permit the use or occupancy of the Premises by anyone other than
Tenant, and shall not make, suffer or permit such assignment, subleasing or
occupancy without the prior written consent of Landlord, such consent not to be
unreasonably withheld, conditioned or delayed, and said restrictions shall be
binding upon any and all assignees of the Lease and subtenants of the Premises.
In the event Tenant desires to sublet, or permit such occupancy of, the
Premises, or any portion thereof, or assign this Lease, Tenant shall give
written notice thereof to Landlord at least sixty (60) days but no more than one
hundred twenty (120) days prior to the proposed commencement date of such
subletting or assignment, which notice shall set forth the name of the proposed
subtenant or assignee, the relevant terms of any sublease or assignment and
copies of financial reports and other relevant financial information of the
proposed subtenant or assignee.
 
    9.2  Notwithstanding any assignment or subletting, permitted or otherwise,
Tenant shall at all times remain directly, primarily and fully responsible and
liable for the payment of the rent specified in this Lease and for compliance
with all of its other obligations under the terms, provisions and covenants of
this Lease. Upon the occurrence of an Event of Default, if the Premises or any
part of them are then assigned or sublet, Landlord, in addition to any other
remedies provided in this Lease or provided by law, may, at its option, collect
directly from such assignee or subtenant all rents due and becoming due to
Tenant under such assignment or sublease and apply such rent against any sums
due to Landlord from Tenant under this Lease, and no such collection shall be
construed to constitute a novation or release of Tenant from the further
performance of Tenant’s obligations under this Lease.
 
    9.3  In addition to Landlord’s right to approve of any subtenant or
assignee, Landlord shall have the option, in its sole discretion, in the event
of any proposed subletting or assignment, to terminate this Lease, or in the
case of one or more proposed sublettings (together with any prior sublettings)
of twenty percent (20%) or more of the Premises in the aggregate for a period
constituting the all or substantially all of the remainder of the Term
(exclusive of any extension term), to recapture the portion of the Premises to
be sublet, as of the date the subletting or assignment is to be effective. The
option shall be exercised, if at all, by Landlord giving Tenant written notice
given by Landlord to Tenant within thirty (30) days following Landlord’s receipt
of Tenant’s written notice as required above. However, if Tenant notifies
Landlord, within five (5) days after receipt of Landlord’s termination notice,
that Tenant is rescinding its proposed assignment or sublease, the termination
notice shall be void and the Lease shall continue in full force and effect;
provided, however, Tenant’s failure to rescind its proposed assignment or
sublease shall be deemed a waiver of such rescission right by Tenant. If this
Lease shall be terminated with respect to the entire Premises pursuant to this
Section, the Term of this Lease shall end on the date stated in Tenant’s notice
as the effective date of the sublease or assignment as if that date had been
originally fixed in this Lease for the expiration of the Term. If Landlord
recaptures under this Section only a portion of the Premises, the rent to be
paid from time to time during the unexpired Term shall abate proportionately
based on the proportion by which the approximate square footage of the remaining
portion of the Premises shall be less than that of the Premises as of the date
immediately prior to such recapture. Tenant shall, at Tenant’s own cost and
expense, discharge in full any outstanding commission obligation which may be
due and owing as a result of any proposed assignment or subletting, whether or
not the Premises are recaptured pursuant to this Section 9.3 and rented by
Landlord to the proposed tenant or any other tenant.
 

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    9.4  In the event that Tenant sells, sublets, assigns or transfers this
Lease (excluding an assignment, sublease or other transaction as permitted by
Section 9.8), Tenant shall pay to Landlord as additional rent an amount equal to
seventy five percent (75%) of any Increased Rent (as defined below), less the
Costs Component (as defined below), when and as such Increased Rent is received
by Tenant. As used in this Section, “Increased Rent” shall mean the excess of
(i) all rent and other consideration which Tenant is entitled to receive by
reason of any sale, sublease, assignment or other transfer of this Lease, over
(ii) the rent otherwise payable by Tenant under this Lease at such time. For
purposes of the foregoing, any consideration received by Tenant in form other
than cash shall be valued at its fair market value as determined by Landlord in
good faith. The “Costs Component” is that amount which, if paid monthly, would
fully amortize on a straight-line basis, over the entire period for which Tenant
is to receive Increased Rent, the reasonable costs incurred by Tenant for
leasing commissions and tenant improvements in connection with such sublease,
assignment or other transfer (excluding therefrom, however, any costs or
expenses attributable to any vacancy factor).
 
    9.5  Notwithstanding any other provision hereof, it shall be considered
reasonable for Landlord to withhold its consent to any assignment of this Lease
or sublease of any portion of the Premises if at the time of either Tenant’s
notice of the proposed assignment or sublease or the proposed commencement date
thereof, there shall exist any uncured default of Tenant or matter which will
become a default of Tenant with passage of time unless cured, or if the proposed
assignee or sublessee is an entity: (a) with which Landlord is already in
negotiation; (b) is already an occupant of the Building unless Landlord is
unable to provide the amount of space required by such occupant; (c) is a
governmental agency; (d) is incompatible with the character of occupancy of the
Building; (e) with which the payment for the sublease or assignment is
determined in whole or in part based upon its net income or profits; or (f)
would subject the Premises to a use which would: (i) involve increased personnel
or wear upon the Building; (ii) violate any exclusive right granted to another
tenant of the Building; (iii) require any addition to or modification of the
Premises or the Building in order to comply with building code or other
governmental requirements; or, (iv) involve a violation of Section 1.2. Tenant
expressly agrees that for the purposes of any statutory or other requirement of
reasonableness on the part of Landlord, Landlord’s refusal to consent to any
assignment or sublease for any of the reasons described in this Section 9.5,
shall be conclusively deemed to be reasonable.
 
    9.6  Upon any request to assign or sublet, Tenant will pay to Landlord the
Assignment/Subletting Fee plus, on demand, a sum equal to all of Landlord’s
reasonable costs, including reasonable attorney’s fees, incurred in
investigating and considering any proposed or purported assignment or pledge of
this Lease or sublease of any of the Premises, regardless of whether Landlord
shall consent to, refuse consent, or determine that Landlord’s consent is not
required for, such assignment, pledge or sublease. Any purported sale,
assignment, mortgage, transfer of this Lease or subletting which does not comply
with the provisions of this Article 9 shall be void.
 
    9.7  If Tenant is a corporation, limited liability company, partnership or
trust, any transfer or transfers of or change or changes within any twelve (12)
month period in the number of the outstanding voting shares of the corporation
or limited liability company, the general partnership interests in the
partnership or the identity of the persons or entities controlling the
activities of such partnership or trust resulting in the persons or entities
owning or controlling a majority of such shares, partnership interests or
activities of such partnership or trust at the beginning of such period no
longer having such ownership or control shall be regarded as equivalent to an
assignment of this Lease to the persons or entities acquiring such ownership or
control and shall be subject to all the provisions of this Article 9 to the same
extent and for all intents and purposes as though such an assignment. The
foregoing limitation shall not apply to the ordinary purchase and sale of shares
of Tenant if Tenant is a corporation, the voting stock of which is listed on a
nationally-recognized securities exchange as defined in the Securities Exchange
Act of 1934, as amended or superseded.
 

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    9.8  Notwithstanding the foregoing provisions of this Article to the
contrary, Tenant shall be permitted to assign this Lease, or sublet all or a
portion of the Premises, to a Qualified Tenant Affiliate (as hereinafter
defined) of Tenant without the prior consent of Landlord, if all of the
following conditions are first satisfied:
 
        9.8.1  No Event of Default by Tenant shall have occurred and no event
exists which by notice and/or the passage of time would constitute an Event of
Default if not cured within the applicable cure period provided under the Lease,
if any;
 
        9.8.2  a fully executed copy of such assignment or sublease, the
assumption of this Lease by the assignee or acceptance of the sublease by the
sublessee, and such other information regarding the assignment or sublease as
Landlord may reasonably request, shall have been delivered to Landlord;
 
        9.8.3  the Premises shall continue to be operated solely for general
office purposes or other use acceptable to Landlord in its sole discretion;
 
        9.8.4  Tenant shall pay all third party costs reasonably incurred by
Landlord in connection with such assignment or subletting, including without
limitation attorneys’ fees (such third party costs not to exceed $1,500.00 per
such assignment or subletting) and the Assignment/Subletting Fee set forth on
the Reference Page of the Lease; and
 
        9.8.5  such Qualified Tenant Affiliate shall possess a creditworthiness
and financial net worth acceptable to Landlord in its reasonable discretion (as
evidenced by a copy of such entity’s financial statements covering its most
recent fiscal year, audited by an independent certified public accounting firm
(if available), or if not available, certified by such entity’s chief financial
officer).
 
        Tenant acknowledges (and, at Landlord’s request, at the time of such
assignment or subletting shall confirm) that in each instance Tenant shall
remain liable for performance of the terms and conditions of the Lease despite
such assignment or subletting. If such sublease is for less than all of the
Premises, tenant and such sublessee agree to construct at their expense a
Building standard multi-tenant corridor on the applicable floor, if required by,
and in accordance with applicable laws. Such Qualified Tenant Affiliate’s use of
the Premises, in whole or in part, shall not violate any exclusive right granted
to another tenant in the Building. As used herein, the term “Qualified Tenant
Affiliate” shall mean an entity which (i) directly or indirectly controls
Tenant; or (ii) is under the direct or indirect control of Tenant; or (iii) is
under common direct or indirect control with Tenant; or (iv) is the
successor-in-interest to Tenant after a merger, sale of substantially all of the
assets of Tenant or public offering of Tenant’s stock. As used in this Article
9, the term “control” shall mean ownership of fifty-one percent (51%) or more of
the voting securities or rights of the controlled entity.
 

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10 
    INDEMNIFICATION. 

 
    10.1  None of the Landlord Entities shall be liable and Tenant hereby waives
all claims against them for any damage to any property or any injury to any
person in or about the Premises or the Building by or from any cause whatsoever
(including without limiting the foregoing, rain or water leakage of any
character from the roof, windows, walls, basement, pipes, plumbing works or
appliances, the Building not being in good condition or repair, gas, fire, oil,
electricity or theft), except to the extent caused by or arising from the gross
negligence or willful misconduct of Landlord or its agents, employees or
contractors. Tenant shall protect, indemnify and hold the Landlord Entities
harmless from and against any and all loss, claims, liability or costs
(including court costs and attorney’s fees) incurred by reason of (a) any damage
to any property (including but not limited to property of any Landlord Entity)
or any injury (including but not limited to death) to any person occurring in,
on or about the Premises or the Building to the extent that such injury or
damage shall be caused by or arise from any actual or alleged act, neglect,
fault, or omission by or of Tenant or any Tenant Entity to meet any standards
imposed by any duty with respect to the injury or damage; (b) the conduct or
management of any work or thing whatsoever done by the Tenant in or about the
Premises or from transactions of the Tenant concerning the Premises; (c)
Tenant’s failure to comply with any and all governmental laws, ordinances and
regulations applicable to the condition or use of the Premises or its occupancy;
or (d) any breach or default on the part of Tenant in the performance of any
covenant or agreement on the part of the Tenant to be performed pursuant to this
Lease. The provisions of this Article shall survive the termination of this
Lease with respect to any claims or liability accruing prior to such
termination.
 

11 
    INSURANCE.

 
    11.1  Tenant shall keep in force throughout the Term: (a) a Commercial
General Liability insurance policy or policies to protect the Landlord Entities
against any liability to the public or to any invitee of Tenant or a Landlord
Entity incidental to the use of or resulting from any accident occurring in or
upon the Premises with a limit of not less than $1,000,000.00 per occurrence and
not less than $2,000,000.00 in the annual aggregate, or such larger amount as
Landlord may prudently require from time to time, covering bodily injury and
property damage liability and $1,000,000 products/completed operations
aggregate; (b) Business Auto Liability covering owned, non-owned and hired
vehicles with a limit of not less than $1,000,000 per accident; (c) insurance
protecting against liability under Worker’s Compensation Laws with limits at
least as required by statute with Employers Liability with limits of $500,000
each accident, $500,000 disease policy limit, $500,000 disease--each employee;
(d) All Risk or Special Form coverage protecting Tenant against loss of or
damage to Tenant’s alterations, additions, improvements, carpeting, floor
coverings, panelings, decorations, fixtures, inventory and other business
personal property situated in or about the Premises to the full replacement
value of the property so insured; and, (e) Business Interruption Insurance with
limit of liability representing loss of at least approximately six (6) months of
income.
 
    11.2  The aforesaid policies shall (a) be provided at Tenant’s expense; (b)
name the Landlord Entities as additional insureds (General Liability) and loss
payee (Property—Special Form); (c) be issued by an insurance company with a
minimum Best’s rating of “A:VII” during the Term; and (d) provide that said
insurance shall be written on an occurrence basis and shall not be canceled
unless thirty (30) days prior written notice (ten days for non-payment of
premium) shall have been given to Landlord; a certificate of Liability insurance
on ACORD Form 25 and a certificate of Property insurance on ACORD Form 27 shall
be delivered to Landlord by Tenant upon the Commencement Date and at least
thirty (30) days prior to each renewal of said insurance.
 
    11.3  Whenever Tenant shall undertake any alterations, additions or
improvements in, to or about the Premises (“Work”) the aforesaid insurance
protection must extend to and include injuries to persons and damage to property
arising in connection with such Work, without limitation including liability
under any applicable structural work act, and such other insurance as Landlord
shall require; and the policies of or certificates evidencing such insurance
must be delivered to Landlord prior to the commencement of any such Work.
 

12 
    WAIVER OF SUBROGATION. 

 
    12.1  So long as their respective insurers so permit, Tenant and Landlord
hereby mutually waive their respective rights of recovery against each other for
any property loss insured by fire, extended coverage, All Risks or other
insurance now or hereafter existing for the benefit of the respective party but
only to the extent of the net insurance proceeds payable under such policies.
Each party shall obtain any special endorsements required by their insurer to
evidence compliance with the aforementioned waiver.
 

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13 
    SERVICES AND UTILITIES.

 
    13.1  Provided Tenant shall not be in default under this Lease, and subject
to the other provisions of this Lease, Landlord agrees to furnish to the
Premises during Building Business Hours (specified on the Reference Pages) on
generally recognized business days (but exclusive in any event of Sundays and
Holidays), the following services and utilities subject to the rules and
regulations of the Building prescribed from time to time, such services to be
reasonably commensurate with industry standard for suburban commercial office
buildings in the Reston, Virginia submarket, of a similar age, size and quality
to the Building: (a) water suitable for normal office use of the Premises; (b)
heat and air conditioning required in Landlord’s judgment for the use and
occupation of the Premises during Building Business Hours; (c) cleaning and
janitorial service; (d) elevator service by nonattended automatic elevators, if
applicable; (e) snow removal and pest control; and, (f) equipment to bring to
the Premises electricity for lighting, convenience outlets and other normal
office use. Landlord shall include electricity costs in Expenses. In the absence
of Landlord’s gross negligence or willful misconduct, Landlord shall not be
liable for, and Tenant shall not be entitled to, any abatement or reduction of
rental by reason of Landlord’s failure to furnish any of the foregoing, unless
such failure shall persist for an unreasonable time after written notice of such
failure is given to Landlord by Tenant and provided further that Landlord shall
not be liable when such failure is caused by accident, breakage, repairs, labor
disputes of any character, energy usage restrictions or by any other cause,
similar or dissimilar, beyond the reasonable control of Landlord. Landlord shall
use reasonable efforts to remedy any interruption in the furnishing of services
and utilities.
 
    13.2  Should Tenant require any additional work or service, as described
above, including services furnished outside ordinary business hours specified
above, Landlord may, on terms to be agreed, upon reasonable advance notice by
Tenant, furnish such additional service and Tenant agrees to pay Landlord such
charges as may be agreed upon, including any tax imposed thereon, but in no
event at a charge less than Landlord’s actual cost plus overhead for such
additional service and, where appropriate, a reasonable allowance for
depreciation of any systems being used to provide such service. The current
charge for after-hours HVAC service, which is subject to change at any time, is
specified on the Reference Pages.
 
    13.3  Wherever heat-generating machines or equipment are used by Tenant in
the Premises which affect the temperature otherwise maintained by the air
conditioning system or Tenant allows occupancy of the Premises by more persons
than the heating and air conditioning system is designed to accommodate, in
either event whether with or without Landlord’s approval, Landlord reserves the
right, upon providing Tenant with ten (10) days advanced written notice, to
install supplementary heating and/or air conditioning units in or for the
benefit of the Premises and the cost thereof, including the cost of installation
and the cost of operations and maintenance, shall be paid by Tenant to Landlord
within ten (10) days of Landlord’s demand.
 
    13.4   Provided that Landlord’s engineer has concluded in writing that any
walls or structural Building elements being used for the installation and
existence of such equipment have the capacity to hold such equipment, Tenant
may, at its sole expense and subject to Landlord’s prior reasonable approval,
including determination that sufficient capacity exists in the base Building
systems to support the Tenant’s Supplemental HVAC (as defined hereinafter),
install, in accordance with the provisions of Article 6 above, Tenant’s own
supplemental heating and cooling equipment (“Tenant’s Supplementary HVAC”) in
and for the benefit of the Premises. Tenant shall provide Landlord with complete
information concerning Tenant’s Supplementary HVAC, including drawings, plans
and specifications and upon request shall furnish additional information with
respect thereto. If Landlord should retain design professionals to assist
Landlord in evaluating Tenant's Supplementary HVAC drawings, plans or
specifications for the Premises pursuant to this Section, such services and
related fees and expenses shall be at Tenant's expense. All such work shall be
conducted in accordance with Article 6 of this Lease. If Tenant’s Supplementary
HVAC shall require electric current in excess of the electric current normally
supplied to the Premises or if there are other costs or expenses arising from
such installation, use, maintenance, and/or removal of such Supplementary HVAC,
Tenant shall pay such additional costs as provided in Section 13.5 below and as
may otherwise be incurred. If Tenant is unable to install such Supplementary
HVAC for any reason, there shall be no abatement of rent, no constructive
eviction, and no liability of Landlord by reason of any injury to or
interference with Tenant’s business caused by the absence of such Supplementary
HVAC.
 

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    13.5   Tenant will not, without the written consent of Landlord, use any
apparatus or device in the Premises, including but not limited to, electronic
data processing machines and machines using current in excess of 2000 watts
and/or 20 amps or 120 volts, which will in any way increase the amount of
electricity or water usually furnished or supplied for use of the Premises for
normal office use, nor connect with electric current, except through existing
electrical outlets in the Premises, or water pipes, any apparatus or device for
the purposes of using electrical current or water. If Tenant shall require water
or electric current in excess of that usually furnished or supplied for use of
the Premises as normal office use, Tenant shall procure the prior written
consent of Landlord for the use thereof, which Landlord may refuse, and if
Landlord does consent, Landlord may cause a water meter or electric current
meter to be installed so as to measure the amount of such excess water and
electric current. The cost of any such meters shall be paid for by Tenant.
Tenant agrees to pay to Landlord within ten (10) days of Landlord’s demand , the
cost of all such excess water and electric current consumed (as shown by said
meters, if any, or, if none, as reasonably estimated by Landlord) at the rates
charged for such services by the local public utility or agency, as the case may
be, furnishing the same, plus any additional expense incurred in keeping account
of the water and electric current so consumed. 
 
    13.6   Tenant will not, without the written consent of Landlord, contract
with a utility provider to service the Premises with any utility, including, but
not limited to, telecommunications, electricity, water, sewer or gas, which is
not previously providing such service to other tenants in the Building. Subject
to Landlord’s reasonable rules and regulations and the provisions of Articles 6
and 26, Tenant shall be entitled to the use of wiring (“Communications Wiring”)
from the existing telecommunications nexus in the Building to the Premises,
sufficient for normal general office use of the Premises. Tenant shall not
install any additional Communications Wiring, nor remove any Communications
Wiring, without in each instance obtaining the prior written consent of
Landlord, which consent may be withheld in Landlord’s sole and absolute
discretion. Landlord’s shall in no event be liable for disruption in any service
obtained by Tenant pursuant to this paragraph.
 
    13.7   Without Landlord's prior written permission, to be granted or
withheld in Landlord’s sole and absolute discretion, Tenant will not attach any
sign on any part of the outside of the Premises or the Building, or on any part
of the inside of the Premises that is visible outside the Premises, or in the
halls, lobbies, windows, or elevator banks of the Building. Regarding the
Permitted Sign (defined hereinafter) and any other approved sign: (i) Tenant
will comply with and be subject to the requirements of any and all governmental
authorities having jurisdiction over the Building, (ii) Tenant shall maintain at
its expense the Permitted Sign and any other approved sign, (iii) such Permitted
Sign and any other approved sign shall not violate any other tenant’s signage
rights; and (iv) Tenant shall, prior to the end of the Term of this Lease, and
at its expense, remove the Permitted Sign and any other approved sign and
restore any affected portion of the Building to a condition similar to that
which existed prior to the installation of the sign at the time of such removal.
If Tenant fails to do so, Landlord may remove all such signs without notice to
Tenant and at Tenant's expense. Tenant will not use the name of the Building for
any purpose other than the address of the Building. Subject to the foregoing and
provided that there shall not exist any Event of Default, and no event exists
which by notice and/or the passage of time would constitute an Event of Default
if not cured within the applicable cure period provided under this Lease, Tenant
may maintain a sign on the outside of the Building at a location to be
determined by Landlord in its sole and absolute discretion, the design of which
shall be subject to Landlord’s prior written approval, to be granted or withheld
in Landlord’s sole and absolute discretion (the “Permitted Sign”).
 

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14 
    HOLDING OVER. 

 
    14.1  Tenant shall pay Landlord for each day Tenant retains possession of
the Premises or part of them after termination of this Lease by lapse of time or
otherwise at the rate (“Holdover Rate”) which shall be One Hundred Fifty Percent
(150%) of the greater of (a) the amount of the Annual Rent for the last period
prior to the date of such termination plus all Rent Adjustments under Article 4;
and (b) the then market rental value of the Premises as determined by Landlord
assuming a new lease of the Premises of the then usual duration and other terms,
in either case, prorated on a daily basis, and also pay all damages sustained by
Landlord by reason of such retention. If Landlord gives notice to Tenant of
Landlord’s election to such effect, such holding over shall constitute renewal
of this Lease for a period from month to month at the Holdover Rate, but if the
Landlord does not so elect, no such renewal shall result notwithstanding
acceptance by Landlord of any sums due hereunder after such termination; and
instead, a tenancy at sufferance at the Holdover Rate shall be deemed to have
been created. In any event, no provision of this Article 14 shall be deemed to
waive Landlord’s right of reentry or any other right under this Lease or at law.
 

15 
    SUBORDINATION. 

  
      15.1  Without the necessity of any additional document being executed by
Tenant for the purpose of effecting a subordination, this Lease shall be subject
and subordinate at all times to ground or underlying leases and to the lien of
any mortgages or deeds of trust now or hereafter placed on, against or affecting
the Building, Landlord’s interest or estate in the Building, or any ground or
underlying lease; provided, however, that if the lessor, mortgagee, trustee, or
holder of any such mortgage or deed of trust elects to have Tenant’s interest in
this Lease be superior to any such instrument, then, by notice to Tenant, this
Lease shall be deemed superior, whether this Lease was executed before or after
said instrument. Notwithstanding the foregoing, Tenant covenants and agrees to
execute and deliver within ten (10) days of Landlord’s request such further
instruments evidencing such subordination or superiority of this Lease as may be
required by Landlord.
 
    15.2  Provided that no Event of Default shall have occurred hereunder during
the Term, Landlord shall request and obtain a non-recordable subordination,
non-disturbance, and attornment agreement for Tenant from any current and future
holder of any mortgage and from the future lessor under any ground lease
affecting the Building on such mortgagee’s and/or ground lessor’s standard forms
(collectively, “SNDA”); provided, however, in no event shall: (i) Landlord’s
failure to obtain an SNDA be a breach of the Lease, provided that Landlord shall
have used its reasonable efforts as required of it in this paragraph to obtain
an SNDA; provided, however, if Landlord fails to obtain, at a minimum, an SNDA
for Tenant on such mortgagee’s and/or ground lessor’s standard forms as
described in this paragraph, the sole remedy for such failure shall be that
Tenant’s automatic subordination (as may have been evidenced in writing in
Section 15.1) as provided in this Article shall be deemed null and void; and
(ii) any such SNDA be recorded or prepared in recordable form unless Landlord
and such mortgagee or ground lessor shall expressly so authorize it in writing
in advance. If any such SNDA shall be recorded in the land records of the
Commonwealth of Virginia without the prior written consent of Landlord and any
such mortgagee or ground lessor, Tenant shall cause the same to be discharged of
record within two (2) business days after the later to occur of the date of
recordation or notice from Landlord or any such mortgagee or ground lessor to so
discharge such SNDA. If Tenant shall fail to cause such SNDA to be so discharged
timely, such failure shall constitute an immediate Event of Default hereunder
for which Tenant shall be afforded no further time for cure as may otherwise be
provided elsewhere in this Lease. Tenant’s obligation shall survive the
expiration or earlier termination of this Lease. In addition, Tenant hereby
appoints Landlord as Tenant’s attorney-in-fact (which appointment is coupled
with an interest and is irrevocable) for the sole and express purpose of
removing any such improperly recorded SNDA from such land records at any time
and from time to time. In connection with the exercise of such power, Landlord
shall be entitled to execute any and all documents which may be required in
connection with the removal of the SNDA from record.
 

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16 
    RULES AND REGULATIONS. 

 
    16.1  Tenant shall faithfully observe and comply with all the rules and
regulations as set forth in Exhibit D to this Lease and all reasonable and
non-discriminatory modifications of and additions to them from time to time put
into effect by Landlord. Landlord shall not be responsible to Tenant for the
non-performance by any other tenant or occupant of the Building of any such
rules and regulations. Following actual notice to Landlord from Tenant of
conduct of another tenant or occupant of the Building, Landlord shall use
reasonable efforts to investigate the same and, if such conduct is determined by
Landlord in its sole and absolute discretion to be in violation of such tenant’s
lease or other Building rule or regulation, then Landlord shall use reasonable
efforts have such tenant cease such conduct; provided, however, that Landlord
shall be deemed to have made reasonable efforts to have such tenant cease such
conduct if Landlord has taken one or more of the following actions in a
reasonably timely manner: (i) placed a telephone call to such tenant’s premises
or (ii) caused Landlord’s personnel or another representative to visit such
tenant’s premises. Tenant acknowledges and agrees that (A) Landlord’s
undertaking of either of the identified actions identified in items (i) or (ii)
of the preceding sentence shall be deemed reasonable notwithstanding the
efficacy of such action by the Landlord; and (B) Landlord shall not be required
by the terms of this Lease at any time to undertake or prosecute any legal
action with respect to such tenant or its conduct.
 

17 
    REENTRY BY LANDLORD.

 
    17.1  With reasonable notice to Tenant (which may be verbal), except in the
case of emergency in which case no notice shall be required, Landlord reserves
and shall at all times have the right to re-enter the Premises to inspect the
same, to supply janitor service and any other service to be provided by Landlord
to Tenant under this Lease, to show said Premises to prospective purchasers,
mortgagees or tenants, and to alter, improve or repair the Premises and any
portion of the Building, without abatement of rent, and may for that purpose
erect, use and maintain scaffolding, pipes, conduits and other necessary
structures and open any wall, ceiling or floor in and through the Building and
Premises where reasonably required by the character of the work to be performed,
provided entrance to the Premises shall not be blocked thereby, and further
provided that the business of Tenant shall not be interfered with unreasonably.
Landlord shall have the right at any time to change the arrangement and/or
locations of entrances, or passageways, doors and doorways, and corridors,
windows, elevators, stairs, toilets or other public parts of the Building and to
change the name, number or designation by which the Building is commonly known.
In the event that Landlord damages any portion of any wall or wall covering,
ceiling, or floor or floor covering within the Premises, Landlord shall repair
or replace the damaged portion to match the original as nearly as commercially
reasonable but shall not be required to repair or replace more than the portion
actually damaged. Tenant hereby waives any claim for damages for any injury or
inconvenience to or interference with Tenant’s business, any loss of occupancy
or quiet enjoyment of the Premises, and any other loss occasioned by any action
of Landlord authorized by this Article 17, excluding any claims for personal
injury or physical damage to Tenant’s property as a result of Landlord’s gross
negligence or willful misconduct.
 
    17.2  For each of the aforesaid purposes, Landlord shall at all times have
and retain a key with which to unlock all of the doors in the Premises,
excluding Tenant’s vaults and safes or special security areas (designated in
advance), and Landlord shall have the right to use any and all means which
Landlord may deem proper to open said doors in an emergency to obtain entry to
any portion of the Premises. As to any portion to which access cannot be had by
means of a key or keys in Landlord’s possession, Landlord is authorized to gain
access by such means as Landlord shall elect and the cost of repairing any
damage occurring in doing so shall be borne by Tenant and paid to Landlord
within ten (10) days of Landlord’s demand, provided that Landlord’s inability to
gain access is due to the actions or omissions of Tenant or its representatives.
 

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 18
    DEFAULT.

 
    18.1  Except as otherwise provided in Article 20, the following events shall
be deemed to be Events of Default under this Lease:
 
        18.1.1  Tenant shall fail to pay when due any sum of money becoming due
to be paid to Landlord under this Lease, whether such sum be any installment of
the rent reserved by this Lease, any other amount treated as additional rent
under this Lease, or any other payment or reimbursement to Landlord required by
this Lease, whether or not treated as additional rent under this Lease, and such
failure shall continue for a period of five (5) days after written notice that
such payment was not made when due, but if any two (2) such notices shall be
given in a twelve (12) month period, for the twelve (12) month period commencing
with the date of the second such notice, the failure to pay within five (5) days
after due any additional sum of money becoming due to be paid to Landlord under
this Lease during such period shall be an Event of Default, without notice.
 
        18.1.2  Tenant shall fail to comply with any term, provision or covenant
of this Lease and/or the Related Agreements which is not provided for in another
Section of this Article and shall not cure such failure within twenty (20) days
(forthwith, if the failure involves a hazardous condition, or such time period
as may be provided in the Related Agreements) after written notice of such
failure to Tenant provided, however, that such failure shall not be an event of
default if such failure could not reasonably be cured during such twenty (20)
day period, Tenant has commenced the cure within such twenty (20) day period and
thereafter is diligently pursuing such cure to completion, but the total
aggregate cure period shall not exceed ninety (90) days.
 
        18.1.3  Tenant shall fail to vacate the Premises immediately upon
termination of this Lease, by lapse of time or otherwise, or upon termination of
Tenant’s right to possession only.
 
        18.1.4  Tenant shall become insolvent, admit in writing its inability to
pay its debts generally as they become due, file a petition in bankruptcy or a
petition to take advantage of any insolvency statute, make an assignment for the
benefit of creditors, make a transfer in fraud of creditors, apply for or
consent to the appointment of a receiver of itself or of the whole or any
substantial part of its property, or file a petition or answer seeking
reorganization or arrangement under the federal bankruptcy laws, as now in
effect or hereafter amended, or any other applicable law or statute of the
United States or any state thereof.
 

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        18.1.5  A court of competent jurisdiction shall enter an order, judgment
or decree adjudicating Tenant bankrupt, or appointing a receiver of Tenant, or
of the whole or any substantial part of its property, without the consent of
Tenant, or approving a petition filed against Tenant seeking reorganization or
arrangement of Tenant under the bankruptcy laws of the United States, as now in
effect or hereafter amended, or any state thereof, and such order, judgment or
decree shall not be vacated or set aside or stayed within sixty (60) days from
the date of entry thereof.
 
        18.1.6  Any Event of Default as defined in the Prior Lease, the Prior
Lease Termination Agreement and/or the Reston I Lease shall be an Event of
Default hereunder without any notice or opportunity for cure.
 

19 
     REMEDIES.

 
    19.1  Except as otherwise provided in Article 20, upon the occurrence of any
of the Events of Default described or referred to in Article 18, Landlord shall
have the option to pursue any one or more of the following remedies without any
notice or demand whatsoever, concurrently or consecutively and not
alternatively:
 
        19.1.1  Landlord may, at its election, terminate this Lease or terminate
Tenant’s right to possession only, without terminating the Lease.
 
        19.1.2  Upon any termination of this Lease, whether by lapse of time or
otherwise, or upon any termination of Tenant’s right to possession without
termination of the Lease, Tenant shall surrender possession and vacate the
Premises immediately, and deliver possession thereof to Landlord, and Tenant
hereby grants to Landlord full and free license to enter into and upon the
Premises in such event and to repossess Landlord of the Premises as of
Landlord’s former estate and to expel or remove Tenant and any others who may be
occupying or be within the Premises and to remove Tenant’s signs and other
evidence of tenancy and all other property of Tenant therefrom without being
deemed in any manner guilty of trespass, eviction or forcible entry or detainer,
and without incurring any liability for any damage resulting therefrom, Tenant
waiving any right to claim damages for such re-entry and expulsion, and without
relinquishing Landlord’s right to rent or any other right given to Landlord
under this Lease or by operation of law.
 
        19.1.3  Upon any termination of this Lease, whether by lapse of time or
otherwise, Landlord shall be entitled to recover as damages, all rent, including
any amounts treated as additional rent under this Lease, and other sums due and
payable by Tenant on the date of termination, plus as liquidated damages and not
as a penalty, an amount equal to the sum of: (a) in the event of termination for
any reason other than by lapse of time, an amount equal to the then present
value of the rent reserved in this Lease for the residue of the stated Term of
this Lease including any amounts treated as additional rent under this Lease and
all other sums provided in this Lease to be paid by Tenant, minus the fair
rental value of the Premises for such residue; (b) in the event of termination
for any reason other than by lapse of time, the value of the time and expense
necessary to obtain a replacement tenant or tenants, and the estimated expenses
described in Section 19.1.4 relating to recovery of the Premises, preparation
for reletting and for reletting itself; and (c) the cost of performing any other
covenants which would have otherwise been performed by Tenant.
 

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        19.1.4  Upon any termination of Tenant’s right to possession only
without termination of the Lease:
 
            19.1.4.1  Neither such termination of Tenant’s right to possession
nor Landlord’s taking and holding possession thereof as provided in Section
19.1.2 shall terminate the Lease or release Tenant, in whole or in part, from
any obligation, including Tenant’s obligation to pay the rent, including any
amounts treated as additional rent, under this Lease for the full Term, and if
Landlord so elects Tenant shall continue to pay to Landlord the entire amount of
the rent as and when it becomes due, including any amounts treated as additional
rent under this Lease, for the remainder of the Term plus any other sums
provided in this Lease to be paid by Tenant for the remainder of the Term.
 
            19.1.4.2  Landlord shall use commercially reasonable efforts to
relet the Premises or portions thereof to the extent required by applicable law.
Landlord and Tenant agree that nevertheless Landlord shall at most be required
to use only the same efforts Landlord then uses to lease premises in the
Building generally and that in any case that Landlord shall not be required to
give any preference or priority to the showing or leasing of the Premises or
portions thereof over any other space that Landlord may be leasing or have
available and may place a suitable prospective tenant in any such other space
regardless of when such other space becomes available and that Landlord shall
have the right to relet the Premises for a greater or lesser term than that
remaining under this Lease, the right to relet only a portion of the Premises,
or a portion of the Premises or the entire Premises as a part of a larger area,
and the right to change the character or use of the Premises. In connection with
or in preparation for any reletting, Landlord may, but shall not be required to,
make repairs, alterations and additions in or to the Premises and redecorate the
same to the extent Landlord deems necessary or desirable, and Tenant shall pay
the cost thereof, together with Landlord’s expenses of reletting, including,
without limitation, any commission incurred by Landlord, within ten (10) days of
Landlord’s demand. Landlord shall not be required to observe any instruction
given by Tenant about any reletting or accept any tenant offered by Tenant
unless such offered tenant has a credit-worthiness acceptable to Landlord and
leases the entire Premises upon terms and conditions including a rate of rent
(after giving effect to all expenditures by Landlord for tenant improvements,
broker’s commissions and other leasing costs) all no less favorable to Landlord
than as called for in this Lease, nor shall Landlord be required to make or
permit any assignment or sublease for more than the current term or which
Landlord would not be required to permit under the provisions of Article 9.
 
            19.1.4.3  Until such time as Landlord shall elect to terminate the
Lease and shall thereupon be entitled to recover the amounts specified in such
case in Section 19.1.3, Tenant shall pay to Landlord upon demand the full amount
of all rent, including any amounts treated as additional rent under this Lease
and other sums reserved in this Lease for the remaining Term, together with the
costs of repairs, alterations, additions, redecorating and Landlord’s expenses
of reletting and the collection of the rent accruing therefrom (including
reasonable attorney’s fees and broker’s commissions), as the same shall then be
due or become due from time to time, less only such consideration as Landlord
may have received from any reletting of the Premises; and Tenant agrees that
Landlord may file suits from time to time to recover any sums falling due under
this Article 19 as they become due. Any proceeds of reletting by Landlord in
excess of the amount then owed by Tenant to Landlord from time to time shall be
credited against Tenant’s future obligations under this Lease but shall not
otherwise be refunded to Tenant or inure to Tenant’s benefit.
 

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    19.2  Upon the occurrence of an Event of Default, Landlord may (but shall
not be obligated to) cure such default at Tenant’s sole expense. Without
limiting the generality of the foregoing, Landlord may, at Landlord’s option,
enter into and upon the Premises if Landlord determines in its sole discretion
that Tenant is not acting within a commercially reasonable time to maintain,
repair or replace anything for which Tenant is responsible under this Lease or
to otherwise effect compliance with its obligations under this Lease and correct
the same, without being deemed in any manner guilty of trespass, eviction or
forcible entry and detainer and without incurring any liability for any damage
or interruption of Tenant’s business resulting therefrom and Tenant agrees to
reimburse Landlord within five (5) days of Landlord’s demand as additional rent,
for any expenses which Landlord may incur in thus effecting compliance with
Tenant’s obligations under this Lease, plus interest from the date of
expenditure by Landlord at the Wall Street Journal prime rate.
 
    19.3  Tenant understands and agrees that in entering into this Lease,
Landlord is relying upon receipt of all the Annual and Monthly Installments of
Rent to become due with respect to all the Premises originally leased hereunder
over the full Initial Term of this Lease for amortization, including interest at
the Amortization Rate. For purposes hereof, the “Concession Amount” shall be
defined as the aggregate of all amounts forgone or expended by Landlord as free
rent under the lease, under Exhibit B hereof for construction allowances
(excluding therefrom any amounts expended by Landlord for Landlord’s Work, as
defined in Exhibit B), and for brokers’ commissions payable by reason of this
Lease. Accordingly, Tenant agrees that if this Lease or Tenant’s right to
possession of the Premises leased hereunder shall be terminated as of any date
(“Default Termination Date”) prior to the expiration of the full Initial Term
hereof by reason of a default of Tenant, there shall be due and owing to
Landlord as of the day prior to the Default Termination Date, as rent in
addition to all other amounts owed by Tenant as of such Date, the amount
(“Unamortized Amount”) of the Concession Amount determined as set forth below;
provided, however, that in the event that such amounts are recovered by Landlord
pursuant to any other provision of this Article 19, Landlord agrees that it
shall not attempt to recover such amounts pursuant to this Paragraph 19.3. For
the purposes hereof, the Unamortized Amount shall be determined in the same
manner as the remaining principal balance of a mortgage with interest at the
Amortization Rate payable in level payments over the same length of time as from
the effectuation of the Concession concerned to the end of the full Initial Term
of this Lease would be determined. The foregoing provisions shall also apply to
and upon any reduction of space in the Premises, as though such reduction were a
termination for Tenant’s default, except that (i) the Unamortized Amount shall
be reduced by any amounts paid by Tenant to Landlord to effectuate such
reduction and (ii) the manner of application shall be that the Unamortized
Amount shall first be determined as though for a full termination as of the
Effective Date of the elimination of the portion, but then the amount so
determined shall be multiplied by the fraction of which the numerator is the
rentable square footage of the eliminated portion and the denominator is the
rentable square footage of the Premises originally leased hereunder; and the
amount thus obtained shall be the Unamortized Amount.
 
    19.4   If, on account of any breach or default by Tenant in Tenant’s
obligations under the terms and conditions of this Lease, it shall become
necessary or appropriate for Landlord to employ or consult with an attorney or
collection agency concerning or to enforce or defend any of Landlord’s rights or
remedies arising under this Lease or to collect any sums due from Tenant, Tenant
agrees to pay all costs and fees so incurred by Landlord, including, without
limitation, reasonable attorneys’ fees and costs. TENANT EXPRESSLY WAIVES ANY
RIGHT TO: (A) TRIAL BY JURY; AND (B) SERVICE OF ANY NOTICE REQUIRED BY ANY
PRESENT OR FUTURE LAW OR ORDINANCE APPLICABLE TO LANDLORDS OR TENANTS BUT NOT
REQUIRED BY THE TERMS OF THIS LEASE.
 
    19.5   Pursuit of any of the foregoing remedies shall not preclude pursuit
of any of the other remedies provided in this Lease or any other remedies
provided by law (all such remedies being cumulative), nor shall pursuit of any
remedy provided in this Lease constitute a forfeiture or waiver of any rent due
to Landlord under this Lease or of any damages accruing to Landlord by reason of
the violation of any of the terms, provisions and covenants contained in this
Lease.
 

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    19.6  No act or thing done by Landlord or its agents during the Term shall
be deemed a termination of this Lease or an acceptance of the surrender of the
Premises, and no agreement to terminate this Lease or accept a surrender of said
Premises shall be valid, unless in writing signed by Landlord. No waiver by
Landlord of any violation or breach of any of the terms, provisions and
covenants contained in this Lease shall be deemed or construed to constitute a
waiver of any other violation or breach of any of the terms, provisions and
covenants contained in this Lease. Landlord’s acceptance of the payment of
rental or other payments after the occurrence of an Event of Default shall not
be construed as a waiver of such Default, unless Landlord so notifies Tenant in
writing. Forbearance by Landlord in enforcing one or more of the remedies
provided in this Lease upon an Event of Default shall not be deemed or construed
to constitute a waiver of such Default or of Landlord’s right to enforce any
such remedies with respect to such Default or any subsequent Default.
 
    19.7   To secure the payment of all rentals and other sums of money becoming
due from Tenant under this Lease, Landlord shall have and Tenant grants to
Landlord a first lien upon the leasehold interest of Tenant under this Lease,
which lien may be enforced in equity, and a continuing security interest upon
all goods, wares, equipment, fixtures, furniture, inventory, and other personal
property of Tenant situated on the Premises. Such property shall not be removed
therefrom without the consent of Landlord until all arrearages in rent as well
as any and all other sums of money then due to Landlord under this Lease shall
first have been paid and discharged. Upon the occurrence of an Event of Default,
Landlord shall have, in addition to any other remedies provided in this Lease or
by law, all rights and remedies under the Uniform Commercial Code, including
without limitation the right to sell the property described in this Section 19.7
at public or private sale upon five (5) days’ notice to Tenant. Tenant shall
execute all such financing statements and other instruments as shall be deemed
necessary or desirable in Landlord’s reasonable discretion to perfect the
security interest hereby created.
 
    19.8  Any and all property which may be removed from the Premises by
Landlord pursuant to the authority of this Lease or of law, to which Tenant is
or may be entitled, may be handled, removed and/or stored, as the case may be,
by or at the direction of Landlord but at the risk, cost and expense of Tenant,
and Landlord shall in no event be responsible for the value, preservation or
safekeeping thereof. Tenant shall pay to Landlord, upon demand, any and all
expenses incurred in such removal and all storage charges against such property
so long as the same shall be in Landlord’s possession or under Landlord’s
control. Any such property of Tenant not retaken by Tenant from storage within
thirty (30) days after removal from the Premises shall, at Landlord’s option, be
deemed conveyed by Tenant to Landlord under this Lease as by a bill of sale
without further payment or credit by Landlord to Tenant.
 
    19.9  If more than two (2) Events of Default occur during the Term and/or
any renewal thereof, Tenant’s renewal options, expansion options, purchase
options and rights of first offer and/or refusal, if any are provided for in
this Lease, shall be null and void.
 

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20 
    TENANT’S BANKRUPTCY OR INSOLVENCY. 

 
    20.1  If at any time and for so long as Tenant shall be subjected to the
provisions of the United States Bankruptcy Code or other law of the United
States or any state thereof for the protection of debtors as in effect at such
time (each a “Debtor’s Law”):
 
        20.1.1   Tenant, Tenant as debtor-in-possession, and any trustee or
receiver of Tenant’s assets (each a “Tenant’s Representative”) shall have no
greater right to assume or assign this Lease or any interest in this Lease, or
to sublease any of the Premises than accorded to Tenant in Article 9, except to
the extent Landlord shall be required to permit such assumption, assignment or
sublease by the provisions of such Debtor’s Law. Without limitation of the
generality of the foregoing, any right of any Tenant’s Representative to assume
or assign this Lease or to sublease any of the Premises shall be subject to the
conditions that:
 
            20.1.1.1  Such Debtor’s Law shall provide to Tenant’s Representative
a right of assumption of this Lease which Tenant’s Representative shall have
timely exercised and Tenant’s Representative shall have fully cured any default
of Tenant under this Lease.
 
            20.1.1.2  Tenant’s Representative or the proposed assignee, as the
case shall be, shall have deposited with Landlord as security for the timely
payment of rent an amount equal to the larger of: (a) three (3) months’ rent and
other monetary charges accruing under this Lease; and (b) any sum specified in
Article 4; and shall have provided Landlord with adequate other assurance of the
future performance of the obligations of the Tenant under this Lease. Without
limitation, such assurances shall include, at least, in the case of assumption
of this Lease, demonstration to the satisfaction of the Landlord that Tenant’s
Representative has and will continue to have sufficient unencumbered assets
after the payment of all secured obligations and administrative expenses to
assure Landlord that Tenant’s Representative will have sufficient funds to
fulfill the obligations of Tenant under this Lease; and, in the case of
assignment, submission of current financial statements of the proposed assignee,
audited by an independent certified public accountant reasonably acceptable to
Landlord and showing a net worth and working capital in amounts determined by
Landlord to be sufficient to assure the future performance by such assignee of
all of the Tenant’s obligations under this Lease.
 
            20.1.1.3  The assumption or any contemplated assignment of this
Lease or subleasing any part of the Premises, as shall be the case, will not
breach any provision in any other lease, mortgage, financing agreement or other
agreement by which Landlord is bound.
 
            20.1.1.4  Landlord shall have, or would have had absent the Debtor’s
Law, no right under Article 9 to refuse consent to the proposed assignment or
sublease by reason of the identity or nature of the proposed assignee or
sublessee or the proposed use of the Premises concerned.
 

21 
     QUIET ENJOYMENT. 

 
    21.1  Landlord represents and warrants that it has full right and authority
to enter into this Lease and that Tenant, while paying the rental and performing
its other covenants and agreements contained in this Lease, shall peaceably and
quietly have, hold and enjoy the Premises for the Term without hindrance or
molestation from Landlord subject to the terms and provisions of this Lease.
Landlord shall not be liable for any interference or disturbance by other
tenants or third persons, nor shall Tenant be released from any of the
obligations of this Lease because of such interference or disturbance.
 

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22 
    CASUALTY 

 
    22.1  In the event the Premises or the Building are damaged by fire or other
cause and in Landlord’s reasonable estimation such damage can be materially
restored within one hundred eighty (180) days, Landlord shall forthwith repair
the same and this Lease shall remain in full force and effect, except that
Tenant shall be entitled to a proportionate abatement in rent from the date of
such damage. Such abatement of rent shall be made pro rata in accordance with
the extent to which the damage and the making of such repairs shall interfere
with the use and occupancy by Tenant of the Premises from time to time. Within
forty-five (45) days from the date of such damage, Landlord shall notify Tenant,
in writing, of Landlord’s reasonable estimation of the length of time within
which material restoration can be made, and Landlord’s determination shall be
binding on Tenant. For purposes of this Lease, the Building or Premises shall be
deemed “materially restored” if they are in such condition as would not prevent
or materially interfere with Tenant’s use of the Premises for the purpose for
which it was being used immediately before such damage.
    
    22.2  If such repairs cannot, in Landlord’s reasonable estimation, be made
within one hundred eighty (180) days, Landlord and Tenant shall each have the
option of giving the other, at any time within ninety (90) days after such
damage, notice terminating this Lease as of the date of such damage. In the
event of the giving of such notice, this Lease shall expire and all interest of
the Tenant in the Premises shall terminate as of the date of such damage as if
such date had been originally fixed in this Lease for the expiration of the
Term. In the event that neither Landlord nor Tenant exercises its option to
terminate this Lease, then Landlord shall repair or restore such damage, this
Lease continuing in full force and effect, and the rent hereunder shall be
proportionately abated as provided in Section 22.1.
 
    22.3  Landlord shall not be required to repair or replace any damage or loss
by or from fire or other cause to any panelings, decorations, partitions,
additions, railings, ceilings, floor coverings, office fixtures or any other
property or improvements installed on the Premises by, or belonging to, Tenant.
Any insurance which may be carried by Landlord or Tenant against loss or damage
to the Building or Premises shall be for the sole benefit of the party carrying
such insurance and under its sole control.
 
    22.4  In the event that Landlord should fail to complete such repairs and
material restoration within sixty (60) days after the date estimated by Landlord
therefor as extended by this Section 22.4, Tenant may at its option and as its
sole remedy terminate this Lease by delivering written notice to Landlord,
within fifteen (15) days after the expiration of said period of time, whereupon
the Lease shall end on the date of such notice or such later date fixed in such
notice as if the date of such notice was the date originally fixed in this Lease
for the expiration of the Term; provided, however, that if construction is
delayed because of changes, deletions or additions in construction requested by
Tenant, strikes, lockouts, casualties, Acts of God, war, material or labor
shortages, government regulation or control or other causes beyond the
reasonable control of Landlord, the period for restoration, repair or rebuilding
shall be extended for the amount of time Landlord is so delayed.
 
    22.5  Notwithstanding anything to the contrary contained in this Article:
(a) Landlord shall not have any obligation whatsoever to repair, reconstruct, or
restore the Premises when the damages resulting from any casualty covered by the
provisions of this Article 22 occur during the last twelve (12) months of the
Term or any extension thereof, but if Landlord determines not to repair such
damages Landlord shall notify Tenant and if such damages shall render any
material portion of the Premises untenantable Tenant shall have the right to
terminate this Lease by notice to Landlord within fifteen (15) days after
receipt of Landlord’s notice; and (b) in the event the holder of any
indebtedness secured by a mortgage or deed of trust covering the Premises or
Building requires that any insurance proceeds be applied to such indebtedness,
then Landlord shall have the right to terminate this Lease by delivering written
notice of termination to Tenant within fifteen (15) days after such requirement
is made by any such holder, whereupon this Lease shall end on the date of such
damage as if the date of such damage were the date originally fixed in this
Lease for the expiration of the Term.
 
    22.6  In the event of any damage or destruction to the Building or Premises
by any peril covered by the provisions of this Article 22, it shall be Tenant’s
responsibility to properly secure the Premises and upon notice from Landlord to
remove forthwith, at its sole cost and expense, such portion of all of the
property belonging to Tenant or its licensees from such portion or all of the
Building or Premises as Landlord shall request.
 

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23 
    EMINENT DOMAIN. 

 
    23.1  If all or any substantial part of the Premises shall be taken or
appropriated by any public or quasi-public authority under the power of eminent
domain, or conveyance in lieu of such appropriation, either party to this Lease
shall have the right, at its option, of giving the other, at any time within
thirty (30) days after such taking, notice terminating this Lease, except that
Tenant may only terminate this Lease by reason of taking or appropriation, if
such taking or appropriation shall be so substantial as to materially interfere
with Tenant’s use and occupancy of the Premises. If neither party to this Lease
shall so elect to terminate this Lease, the rental thereafter to be paid shall
be adjusted on a fair and equitable basis under the circumstances. In addition
to the rights of Landlord above, if any substantial part of the Building shall
be taken or appropriated by any public or quasi-public authority under the power
of eminent domain or conveyance in lieu thereof, and regardless of whether the
Premises or any part thereof are so taken or appropriated, Landlord shall have
the right, at its sole option, to terminate this Lease. Landlord shall be
entitled to any and all income, rent, award, or any interest whatsoever in or
upon any such sum, which may be paid or made in connection with any such public
or quasi-public use or purpose, and Tenant hereby assigns to Landlord any
interest it may have in or claim to all or any part of such sums, other than any
separate award which may be made with respect to Tenant’s trade fixtures and
moving expenses; Tenant shall make no claim for the value of any unexpired Term.
 

24 
    SALE BY LANDLORD. 

 
    24.1  In event of a sale or conveyance by Landlord of the Building, the same
shall operate to release Landlord from any future liability upon any of the
covenants or conditions, expressed or implied, contained in this Lease in favor
of Tenant, and in such event Tenant agrees to look solely to the responsibility
of the successor in interest of Landlord in and to this Lease. Except as set
forth in this Article 24, this Lease shall not be affected by any such sale and
Tenant agrees to attorn to the purchaser or assignee. If any security has been
given by Tenant to secure the faithful performance of any of the covenants of
this Lease, Landlord may transfer or deliver said security, as such, to
Landlord’s successor in interest and thereupon Landlord shall be discharged from
any further liability with regard to said security.
 

25 
    ESTOPPEL CERTIFICATES. 

 
    25.1  Within ten (10) days following any written request which Landlord may
make from time to time, Tenant shall execute and deliver to Landlord or
mortgagee or prospective mortgagee a sworn statement certifying: (a) the date of
commencement of this Lease; (b) the fact that this Lease is unmodified and in
full force and effect (or, if there have been modifications to this Lease, that
this lease is in full force and effect, as modified, and stating the date and
nature of such modifications); (c) the date to which the rent and other sums
payable under this Lease have been paid; (d) the fact that there are no current
defaults under this Lease by either Landlord or Tenant except as specified in
Tenant’s statement; and (e) such other matters as may be requested by Landlord.
Landlord and Tenant intend that any statement delivered pursuant to this Article
25 may be relied upon by any mortgagee, beneficiary or purchaser, and Tenant
shall be liable for all loss, cost or expense resulting from the failure of any
sale or funding of any loan caused by any material misstatement contained in
such estoppel certificate. Tenant irrevocably agrees that if Tenant fails to
execute and deliver such certificate within such ten (10) day period Landlord or
Landlord’s beneficiary or agent may execute and deliver such certificate on
Tenant’s behalf, and that such certificate shall be fully binding on Tenant.
 

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26 
    SURRENDER OF PREMISES.

 
    26.1  Tenant shall arrange to meet Landlord for two (2) joint inspections of
the Premises, the first to occur at least thirty (30) days (but no more than
sixty (60) days) before the last day of the Term, and the second to occur not
later than forty-eight (48) hours after Tenant has vacated the Premises. In the
event of Tenant’s failure to participate in either such inspection, Landlord’s
inspection at or after Tenant’s vacating the Premises shall be conclusively
deemed correct for purposes of determining Tenant’s responsibility for repairs
and restoration.
 
    26.2  All alterations, additions, and improvements in, on, or to the
Premises made or installed by or for Tenant, including carpeting (collectively,
“Alterations”), shall be and remain the property of Tenant during the Term. Upon
the expiration or sooner termination of the Term, all Alterations shall become a
part of the realty and shall belong to Landlord without compensation, and title
shall pass to Landlord under this Lease as by a bill of sale. At the end of the
Term or any renewal of the Term or other sooner termination of this Lease,
Tenant will peaceably deliver up to Landlord possession of the Premises,
together with all Alterations by whomsoever made, in the same conditions
received or first installed, broom clean and free of all debris, excepting only
ordinary wear and tear and damage by fire or other casualty. Notwithstanding the
foregoing, if Landlord elects by notice given to Tenant at least ten (10) days
prior to expiration of the Term, Tenant shall, at Tenant’s sole cost, remove any
Alterations, including carpeting, so designated by Landlord’s notice, and repair
any damage caused by such removal. Tenant must, at Tenant’s sole cost, remove
upon termination of this Lease, any and all of Tenant’s furniture, furnishings,
movable partitions of less than full height from floor to ceiling and other
trade fixtures and personal property (collectively, “Personalty”). Personalty
not so removed shall be deemed abandoned by the Tenant and title to the same
shall thereupon pass to Landlord under this Lease as by a bill of sale, but
Tenant shall remain responsible for the cost of removal and disposal of such
Personalty, as well as any damage caused by such removal. If there has been a
monetary default by Tenant during the six (6) months preceding the expiration or
earlier termination of this Lease, then in lieu of requiring Tenant to remove
Alterations and Personalty and repair the Premises as aforesaid, Landlord may,
by written notice to Tenant delivered at least thirty (30) days before the
Termination Date, require Tenant to pay to Landlord, as additional rent
hereunder, the cost of such removal and repair in an amount reasonably estimated
by Landlord.
 
    26.3  All obligations of Tenant under this Lease not fully performed as of
the expiration or earlier termination of the Term shall survive the expiration
or earlier termination of the Term Upon the expiration or earlier termination of
the Term, Tenant shall pay to Landlord the amount, as reasonably estimated by
Landlord, necessary to repair and restore the Premises as provided in this Lease
and/or to discharge Tenant’s obligation for unpaid amounts due or to become due
to Landlord. All such amounts shall be used and held by Landlord for payment of
such obligations of Tenant, with Tenant being liable for any additional costs
upon demand by Landlord, or with any excess to be returned to Tenant after all
such obligations have been determined and satisfied. Any otherwise unused
Security Deposit shall be credited against the amount payable by Tenant under
this Lease.
 

27 
    NOTICES. 

 
    27.1  Any notice or document required or permitted to be delivered under
this Lease shall be addressed to the intended recipient, by fully prepaid
registered or certified United States Mail return receipt requested, or by
reputable independent contract delivery service furnishing a written record of
attempted or actual delivery, and shall be deemed to be delivered when tendered
for delivery to the addressee at its address set forth on the Reference Pages,
or at such other address as it has then last specified by written notice
delivered in accordance with this Article 27, or if to Tenant at either its
aforesaid address or its last known registered office or home of a general
partner or individual owner, whether or not actually accepted or received by the
addressee. Any such notice or document may also be personally delivered if a
receipt is signed by and received from, the individual, if any, named in
Tenant’s Notice Address. Service of process upon Landlord shall be served upon
Landlord’s Registered Agent for Service of Process, as designated on the
Reference Pages, with a copy (which shall not constitute notice) to Landlord at
Landlord’s Address as set forth on the Reference Pages.
 

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28 
    TAXES PAYABLE BY TENANT. 

 
    28.1  In addition to rent and other charges to be paid by Tenant under this
Lease, Tenant shall reimburse to Landlord, upon demand, any and all taxes
payable by Landlord (other than net income taxes, franchise taxes, recordation
taxes or transfer taxes) whether or not now customary or within the
contemplation of the parties to this Lease: (a) upon, allocable to, or measured
by or on the gross or net rent payable under this Lease, including without
limitation any gross income tax or excise tax levied by the State, any political
subdivision thereof, or the Federal Government with respect to the receipt of
such rent; (b) upon or with respect to the possession, leasing, operation,
management, maintenance, alteration, repair, use or occupancy of the Premises or
any portion thereof, including any sales, use or service tax imposed as a result
thereof; (c) upon or measured by the Tenant’s gross receipts or payroll or the
value of Tenant’s equipment, furniture, fixtures and other personal property of
Tenant or leasehold improvements, alterations or additions located in the
Premises; or (d) upon this transaction or any document to which Tenant is a
party creating or transferring any interest of Tenant in this Lease or the
Premises. In addition to the foregoing, Tenant agrees to pay, before
delinquency, any and all taxes levied or assessed against Tenant by a taxing
authority and which become payable by Tenant during the term hereof upon
Tenant’s equipment, furniture, fixtures and other personal property of Tenant
located in the Premises.
 

29 
    INTENTIONALLY OMITTED.

 

30 
    DEFINED TERMS AND HEADINGS. 

 
    30.1  The Article headings shown in this Lease are for convenience of
reference and shall in no way define, increase, limit or describe the scope or
intent of any provision of this Lease. Any indemnification or insurance of
Landlord shall apply to and inure to the benefit of all the following “Landlord
Entities”, being Landlord, Landlord’s investment manager, and the trustees,
boards of directors, officers, general partners, beneficiaries, stockholders,
employees and agents of each of them. Any option granted to Landlord shall also
include or be exercisable by Landlord’s trustee, beneficiary, agents and
employees, as the case may be. In any case where this Lease is signed by more
than one person, the obligations under this Lease shall be joint and several.
The terms “Tenant” and “Landlord” or any pronoun used in place thereof shall
indicate and include the masculine or feminine, the singular or plural number,
individuals, firms or corporations, and their and each of their respective
successors, executors, administrators and permitted assigns, according to the
context hereof. The term “rentable area” shall mean the rentable area of the
Premises or the Building as calculated by the Landlord on the basis of the plans
and specifications of the Building including a proportionate share of any common
areas. Tenant hereby accepts and agrees to be bound by the figures for the
rentable square footage of the Premises and Tenant’s Proportionate Share shown
on the Reference Pages; however, Landlord may adjust either or both figures if
there is manifest error, addition or subtraction to the Building or any business
park or complex of which the Building is a part, remeasurement or other
circumstance reasonably justifying adjustment. The term “Building” refers to the
structure in which the Premises are located and the common areas (parking lots,
sidewalks, landscaping, etc.) appurtenant thereto. If the Building is part of a
larger complex of structures, the term “Building” may include the entire
complex, where appropriate (such as shared Expenses, Insurance Costs or Taxes)
and subject to Landlord’s reasonable discretion.
 

31 
    TENANT’S AUTHORITY. 

 
    31.1  If Tenant signs as a corporation, partnership, trust or other legal
entity each of the persons executing this Lease on behalf of Tenant represents
and warrants that Tenant has been and is qualified to do business in the state
in which the Building is located, that the entity has full right and authority
to enter into this Lease, and that all persons signing on behalf of the entity
were authorized to do so by appropriate actions. Tenant agrees to deliver to
Landlord, simultaneously with the delivery of this Lease, a corporate
resolution, proof of due authorization by partners, opinion of counsel or other
appropriate documentation reasonably acceptable to Landlord evidencing the due
authorization of Tenant to enter into this Lease.
 

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

    32
    FINANCIAL STATEMENTS AND CREDIT REPORTS. 

 
    32.1  At Landlord’s request and so long as the Tenant is not a corporation,
the voting stock of which is listed on a nationally-recognized securities
exchange as defined in the Securities Exchange Act of 1934, as amended or
superseded, Tenant shall deliver to Landlord a copy, certified by an officer of
Tenant as being a true and correct copy, of Tenant’s most recent audited
financial statement, or, if unaudited, certified by Tenant’s chief financial
officer as being true, complete and correct in all material respects. Tenant
hereby authorizes Landlord to obtain one or more credit reports on Tenant at any
time, and shall execute such further authorizations as Landlord may reasonably
require in order to obtain a credit report.
 

33 
    COMMISSIONS. 

 
    33.1  Each of the parties represents and warrants to the other that it has
not dealt with any broker or finder in connection with this Lease, except as
described on the Reference Pages. Each party hereby agrees to indemnify, defend
and hold the other party harmless from and against any claims by a broker or
finder relating to such party’s breach or alleged breach of the foregoing
representation or warranty. Landlord agrees to pay the Broker identified on the
Reference Pages of this Lease in accordance with the terms of a separate
agreement entered into with such Broker.
 

34 
    TIME AND APPLICABLE LAW. 

 
    34.1  Time is of the essence of this Lease and all of its provisions. This
Lease shall in all respects be governed by the laws of the state in which the
Building is located.
 

35 
    SUCCESSORS AND ASSIGNS. 

 
    35.1  Subject to the provisions of Article 9, the terms, covenants and
conditions contained in this Lease shall be binding upon and inure to the
benefit of the heirs, successors, executors, administrators and assigns of the
parties to this Lease.
 

 36
    ENTIRE AGREEMENT. 

 
    36.1  This Lease, together with its exhibits, contains all agreements of the
parties to this Lease and supersedes any previous negotiations. There have been
no representations made by the Landlord or any of its representatives or
understandings made between the parties other than those set forth in this Lease
and its exhibits. This Lease may not be modified except by a written instrument
duly executed by the parties to this Lease.
 

37 
    EXAMINATION NOT OPTION. 

 
        37.1    Submission of this Lease shall not be deemed to be a reservation
of the Premises. Landlord shall not be bound by this Lease until it has received
a copy of this Lease duly executed by Tenant and has delivered to Tenant a copy
of this Lease duly executed by Landlord, and until such delivery Landlord
reserves the right to exhibit and lease the Premises to other prospective
tenants. Notwithstanding anything contained in this Lease to the contrary,
Landlord may withhold delivery of possession of the Premises from Tenant until
such time as Tenant has paid to Landlord any security deposit required by
Article 4, the first month’s rent as set forth in Article 3 and any sum owed
pursuant to this Lease and provided to Landlord such other items required under
this Lease, including, but not limited to evidence of adequate insurance and
evidence of authority of Tenant to enter into this transaction.
 

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

38 
    RECORDATION. 

 
    38.1  Tenant shall not record or register this Lease or a short form
memorandum hereof without the prior written consent of Landlord, and then shall
pay all charges and taxes incident such recording or registration.
 

39 
    PARKING. 

 
    39.1  During the Term of this Lease, provided that Tenant timely pays the
fee therefor, Tenant shall have the privilege to use up to thirty-six (36)
unreserved, surface parking spaces and up to sixteen (16) unreserved, covered
parking spaces (collectively, the “Parking Spaces,” singularly, a “Parking
Space”) in the parking facility for the Building at the prevailing market rate
for such spaces (the “Monthly Parking Rate”). Such fee shall constitute
additional rent under this Lease. The current rate for a Parking Space is Twenty
and 00/100 Dollars ($20.00) per space per month, subject to change at any time
and from time to time.
 
        39.1.1  Notwithstanding the foregoing, provided that there shall not
exist any Event of Default, and no event exists which by notice and/or the
passage of time would constitute an Event of Default if not cured within the
applicable cure period provided under this Lease, following the Commencement
Date the Monthly Parking Rate shall be abated for the initial Term of this
Lease. Nothing in this Section 39.1.1, however, shall be interpreted to except
or excuse Tenant from any additional rent or other amounts due under this Lease
to Landlord.
 
    39.2  As used in this Article 39, “Landlord” shall be deemed to include an
independent parking facility operator contracted by Landlord to operate the
Building’s parking facility, if any. Tenant acknowledges that Landlord may at
some time establish a standard license agreement (the “Parking License
Agreement”) with respect to the use of parking spaces. Tenant, upon request of
Landlord, shall enter into such Parking License Agreements with Landlord
provided that such agreement does not materially alter the rights of Tenant
hereunder with respect to the parking spaces. No deductions or allowances shall
be made for days when Tenant or any of its employees does not utilize the
parking facilities or for Tenant utilizing less than all of the Parking Spaces.
Tenant shall not assign or sublease any of the Parking Spaces without the
consent of Landlord. Furthermore, Tenant agrees that it and its employees shall
observe reasonable safety precautions in the use of the Building’s parking
facility, and shall at all times abide by all rules and regulations promulgated
by Landlord governing the use of the Building’s parking facility. Except for
claims due to Landlord’s gross negligence or willful misconduct, it is
understood and agreed that Landlord does not assume any responsibility for, and
Tenant hereby expressly releases and discharges Landlord and Landlord Entity
from any liability, and hereby waives any claim against Landlord and Landlord
Entity, for any damage or loss to any automobiles parked in the parking facility
or to any personal property located therein, or for any injury sustained by any
person in or about the parking facility. Landlord shall have the right to
temporarily close the Building parking facility or certain areas therein in
order to perform necessary repairs, maintenance and improvements to the Building
parking facility or the Building; provided, however, that (except in the case of
emergency) Landlord shall provide reasonable advance notice of such closure to
Tenant. Tenant shall not store any automobiles in the Building parking facility
without the prior written consent of Landlord. Except for emergency repairs,
Tenant shall not perform any work on any automobiles while located in the
Building parking facility.
 

40 
    LIMITATION OF LANDLORD’S LIABILITY. 

 
    40.1  Redress for any claim against Landlord under this Lease shall be
limited to and enforceable only against and to the extent of Landlord’s interest
in the Building. The obligations of Landlord under this Lease are not intended
to be and shall not be personally binding on, nor shall any resort be had to the
private properties of, any of its or its investment manager’s trustees,
directors, officers, partners, beneficiaries, members, stockholders, employees,
or agents, and in no case shall Landlord be liable to Tenant hereunder for any
lost profits, damage to business, or any form of special, indirect or
consequential damages.
 
[SIGNATURES CONTAINED ON NEXT PAGE]

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WITNESS:
 
 
 
 
 
 
 
 
 
By: /s/ Patricia Webel
Name: Patricia Webel     
Title: Property Manager     
LANDLORD:
 
TMT RESTON I & II, INC.,
a Delaware corporation
 
 
By: RREEF Management Company,
a Delaware corporation
 
 
By: /s/ Patrick N. Connell
Name: Patrick N. Connell  
Title: Vice President / Regional Director
Dated: 9-26-05
   
ATTEST:
 
 
 
By: /s/ Craig H. Pizer
Name: Craig H. Pizer
Title: Associste General Counsel - Assistant Secretary
 
 
[Corporate Seal]
TENANT:
 
TALK AMERICA INC.
a Pennsylvania corporation
 
By: Aloysius T. Lawn IV
Name: Aloysius T. Lawn IV
Title: Executive Vice-President - General Counsel
Dated: 9-19-05

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EXHIBIT A - FLOOR PLAN DEPICTING THE PREMISES
 

attached to and made a part of Lease bearing the
Lease Reference Date of 2/28/2006 between
TMT Reston I & II, Inc., as Landlord and
Talk America Inc., as Tenant

Exhibits A, A-1 and A-2 are intended only to show the general layout of the
Premises as of the beginning of the Term of this Lease. They do not in any way
supersede any of Landlord’s rights set forth in Article 17 with respect to
arrangements and/or locations of public parts of the Building and changes in
such arrangements and/or locations. They are not to be scaled; any measurements
or distances shown should be taken as approximate.

[Missing Graphic Reference]
 

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

EXHIBIT A-1 - SITE PLAN
 

attached to and made a part of Lease bearing the
Lease Reference Date of 2/28/2006 between
TMT Reston I & II, Inc., as Landlord and
Talk America Inc., as Tenant

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

EXHIBIT A-2 - EXPANSION SPACE
 

attached to and made a part of Lease bearing the
Lease Reference Date of 2/28/2006 between
TMT Reston I & II, Inc., as Landlord and
Talk America Inc., as Tenant

 

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

EXHIBIT B - INITIAL ALTERATIONS
 

attached to and made a part of Lease bearing the
Lease Reference Date of 2/28/2006 between
TMT Reston I & II, Inc., as Landlord and
Talk America Holdings, Inc., as Tenant
 

1.  Landlord and Tenant hereby approve the Project Schedule attached as Exhibit
B-1.
 
2.  Tenant shall cause its architect and engineer, at its sole expense, to
complete all drawings, plans and specifications necessary for the construction
of Tenant’s leasehold improvements to be located in the Premises (“Tenant’s
Improvements”), including but not limited to, MEP working drawings as required
for the permitting and construction of the Premises. Tenant’s architect and
engineer shall be subject to Landlord’s reasonable approval; provided, however,
Landlord hereby approves KTA Group, Inc. as Tenant’s architect and engineer.
Landlord shall provide Tenant with all existing architectural, mechanical,
electrical and plumbing plans for the Premises, including any plans in
Landlord’s possession that were completed on behalf of prior tenants. All of
Tenant’s Improvements and the related drawings, plans and specifications shall
comply with applicable laws, shall be suitable for obtaining all necessary
construction permits and shall be submitted to Landlord for Landlord’s approval
(upon approval by Landlord, the “Final Plans”). Such approval of Landlord shall
not be unreasonably withheld, conditioned or delayed (except with respect to
matters affecting the base Building structure or systems, for which Landlord’s
approval may be granted in Landlord’s sole and absolute discretion). Landlord
shall approve or disapprove the drawings, plans and specifications for Tenant’s
Improvements in accordance with the Project Schedule and Tenant shall cause any
required revisions to be made. Any revisions to drawings, plans and
specifications made pursuant to this paragraph shall be made at Tenant’s
expense. If Landlord shall retain design professionals to assist Landlord in
evaluating Tenant’s drawings, plans or specifications for the Premises pursuant
to this Paragraph 2, such services and related reasonable fees and expenses
shall be at Tenant’s expense.
 
3.  Tenant shall cause its own contractor to construct Tenant’s Improvements.
Tenant’s contractor shall be approved by Landlord, such approval not to be
unreasonably withheld, conditioned or delayed subject to the following
conditions:
 

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

(a) Tenant shall indemnify, defend (with counsel reasonably acceptable to
Landlord), and hold harmless Landlord, Landlord’s managing agent, Landlord’s
affiliates, and Landlord’s invitees from and against any all losses, damages,
costs (including costs of suits and attorneys’ fees), liabilities or causes of
action arising out of or relating to Tenant’s Improvements, including but not
limited to mechanic’s, materialman’s or other liens or claims (and all costs or
expenses associated therewith) asserted, filed or arising out of any such work.
Without limiting the generality of the foregoing, Tenant shall repair or cause
to be repaired at its expense all damage caused by its contractor and Tenant
shall reimburse Landlord for all reasonable costs incurred by Landlord to repair
any damage caused by Tenant’s contractor. All parties contracting with Tenant to
furnish labor, services, materials, suppliers or equipment with respect to the
Premises shall look solely to Tenant for payment of same and Tenant’s purchase
orders and contracts shall state this requirement.

(b) Tenant's contract with any contractor with whom Tenant contracts with
respect to Tenant's Improvements shall include (i) a provision requiring such
contractor to keep the Premises, the Building and appurtenant land and Tenant's
leasehold interest in the Premises free from any liens arising out of any work
performed with respect to Tenant's Improvements; (ii) an express waiver of any
rights the contractor, any subcontractor or any materials supplier may have to
claim a mechanic's, materialman's or other lien or claim arising out of any work
performed with respect to Tenant's Improvements; and (iii) a provision requiring
such contractor to indemnify, defend (with counsel reasonably acceptable to
Landlord) and hold harmless Landlord, Landlord’s managing agent, Landlord’s
affiliates, and Landlord’s invitees from and against any and all losses,
damages, costs (including costs of suits and attorneys' fees), liabilities or
causes of action arising out of or relating to Tenant's Improvements, including
but not limited to mechanic's, materialman's or other liens or claims (and all
costs or expenses associated therewith) asserted, filed or arising out of any
work performed with respect to Tenant's Improvements. Tenant shall provide
Landlord with final unconditional lien waivers from each contractor with whom
Tenant has contracted with respect to Tenant’s Improvements upon final
completion of Tenant’s Improvements.

(c) Tenant’s contractor shall conduct its work in such a manner so as not to
unreasonably interfere with any construction occurring in the Building, or to
disrupt any tenant’s business in the Building and shall comply with Landlord’s
rules and regulations applicable to all work being performed in the Building.
Landlord shall use commercially reasonable efforts to provide access to the
Building and necessary Building systems in order for Tenant to perform its work;
provided, however, Landlord need not open the Building outside of normal
Business Hours and Landlord shall not incur any third party costs related
thereto.

(d) Tenant’s contractor shall maintain such insurance, including but not limited
to Builder’s all-risk insurance, and bonds in full force and effect as may be
reasonably requested by Landlord or as required by applicable law, and all such
insurance shall be with a carrier and in a form acceptable to Landlord. Landlord
shall not be responsible for the storage of Tenant’s materials or Tenant’s
Improvements.

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

4.  Provided that no uncured default exists under the Lease, and no event exists
which, with the giving of notice and passage of time or both would constitute a
default, Landlord covenants and agrees that Landlord will contribute to Tenant
an amount of $12.00 per rentable square foot of the Premises (“Landlord’s
Allowance”) to be applied solely toward: (i) any required construction,
demolition, architectural, wiring, engineering, and design costs and (ii) costs
of obtaining required permits or other governmental approvals necessary for
Tenant’s Improvements; provided, however, up to twenty percent (20%) of
Landlord’s Allowance shall, at Tenant’s election, be applied toward the costs of
purchasing and installing supplemental HVAC equipment, furniture and fixtures in
the Premises or credited against Annual Rent. Landlord shall disburse Landlord’s
Allowance directly to Tenant to be applied towards the cost of constructing
Tenant’s Improvements, upon satisfaction of the following payment conditions:
(a) as to construction, design and engineering costs, Landlord receives evidence
of payment by Tenant of invoices approved by Tenant and Tenant’s architect or
engineer and which are reasonably acceptable to Landlord; (b) as to permits or
other governmental approvals necessary for Tenant’s Improvements, Landlord
receives paid receipts and evidence that such permits or other governmental
approvals have been issued by the applicable governmental authority
(collectively, the foregoing constitute the “Payment Conditions”); and (c) as to
supplemental HVAC equipment, furniture and fixtures, Landlord receives paid
receipts and evidence that such items have been installed within the Premises
and/or Building. Moreover, prior to each such payment by Landlord, the following
conditions also shall be satisfied: (i) receipt by Landlord of invoices and/or
applications for payment recovering all labor and materials expended and used
and subject to a ten percent (10%) retainage until completion of all Tenant’s
Improvements, (ii) architect’s and general contractor’s percentage of completion
affidavits certifying that the work covered by such invoice and/or application
for payment is complete and in place, in form acceptable to Landlord in its sole
discretion, (iii) partial lien waivers covering work with respect to which any
materialman or contractor was previously paid pursuant to an earlier payment by
Landlord (and final unconditional lien waivers with respect to final contract
payments upon final completion of Tenant’s Improvements) in form acceptable to
Landlord in its sole discretion; (iv) as-built plans (upon final completion)
covering all architectural work and mechanical, electrical, plumbing and
structural engineering, (v) certification at Tenant’s expense of Tenant’s
architect (or Landlord’s architect if Tenant has not retained an architect) that
the portion of the Tenant’s Improvements for which payment is being sought has
been installed in a good and workmanlike manner in accordance with approved
plans and applicable codes and ordinances, and (vi) with respect to final
payment and release of retainage, any licenses or permits required by any
applicable governmental authority for Tenant’s legal occupancy of the Premises
and use of the equipment installed therein. Landlord need not pay Tenant for
such charges more frequently than one (1) time per month. In no event shall any
portion of Landlord’s Allowance be disbursed if Tenant is in default (or will be
in default upon notice and/or lapse of time) under the Lease. Tenant shall cause
all costs with respect to Tenant’s Improvements to be timely paid by Tenant,
subject to reimbursement by Landlord of the Landlord’s Allowance. Payments to
Tenant’s contractor are to be made in full within thirty (30) days of
substantial completion of Tenant’s Improvements, subject to Tenant’s withholding
ten percent (10%) retainage until completion of all Tenant’s Improvements as
provided above. Tenant shall use Landlord’s Allowance within twelve (12) months
following the full execution of the Lease or the commencement of construction,
whichever is earlier. The costs of any improvements above the foregoing
Landlord’s Allowance remaining after payment of (x) the construction costs
related to the Tenant’s Improvements and (y) such other costs as described
above, shall be paid for solely by Tenant.
 
5.  All payments to Landlord pursuant to this Work Agreement shall constitute
additional rent under the Lease, and in the event of nonpayment thereof by
Tenant, Landlord shall have all of the rights and remedies set forth in the
Lease.
 
6.  Any delay in Tenant’s contractor’s completion of Tenant’s Improvements
caused by Landlord Delay (as hereinafter defined) shall result in a day-for day
extension of the Commencement Date, except to the extent attributable to Tenant.
As used herein, the term “Landlord Delay” shall mean any actual, incremental
delays to the extent resulting from (i) Landlord’s failure to make decisions or
take actions in accordance with the Project Schedule or (ii) performance or
completion by a party employed by Landlord. Notwithstanding anything to the
contrary contained herein, Tenant shall notify Landlord within five (5) days
after discovering any act or failure to act by Landlord that could cause a
Landlord Delay, or Tenant shall waive any right to claim Landlord Delay for such
act or failure to act.

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

EXHIBIT B-1 - PROJECT SCHEDULE
 

attached to and made a part of Lease bearing the
Lease Reference Date of 2/28/2006between
TMT Reston I & II, Inc., as Landlord and
Talk America Holdings, Inc., as Tenant

Landlord and Tenant agree to the following schedule of obligations with respect
to Tenant’s Improvements.
 
 
Timing
 
 
 
(a) On or before [INSERT DATE]
 
 
Tenant to submit its space plan for the Premises to Landlord for Landlord's
review and approval, not to be unreasonably withheld, conditioned or delayed.
 
 
(b) On or before 5 business days after Landlord's receipt of the space plan
 
 
Landlord to approve or disapprove the space plan.
 
 
(c) On or before 5 business days after Landlord's receipt of Tenant's plans and,
if applicable, the MEP plans.
 
 
Landlord to approve or disapprove the proposed plans and, if applicable, MEP
plans (upon such approval, the “Final Plans”).
 
 
(d) On or before 5 business days after Landlord's approval of the revised Final
Plans.
 
 
Landlord and Tenant to agree upon general contractors to submit bids.
 
 
(e) On or before 5 business days from receipt of contractor's pricing.
 
 
Tenant to review, negotiate (with Landlord's assistance), and approve all
pricing, as the same may be adjusted, and Landlord to approve or disapprove any
changes to the Final Plans.
 
 
(f) Upon Landlord's approval of Tenant’s contractor and any changes to the Final
Plans, and, if applicable, Tenant's delivery to Landlord of the T.I. Shortfall.
 
 
Tenant to engage Tenant's contractor to commence construction of the Tenant's
Improvements.
 

 

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

EXHIBIT C - COMMENCEMENT DATE MEMORANDUM
 

attached to and made a part of Lease bearing the
Lease Reference Date of 2/28/2006 between
TMT Reston I & II, Inc., as Landlord and
Talk America Inc., as Tenant

COMMENCEMENT DATE MEMORANDUM

THIS MEMORANDUM, made as of __________, 20__, by and between TMT Reston I & II,
Inc., a Delaware corporation (“Landlord”) and Talk America Inc., a Pennsylvania
corporation (“Tenant”).
 
Recitals:
 
A.  Landlord and Tenant are parties to that certain Lease, dated for reference
_________, 20__ (the “Lease”) for certain premises (the “Premises”) consisting
of approximately ________ square feet at the building commonly known as Reston
Plaza II located at 12020 Sunrise Valley Drive, Reston, VA 20191.
 
B.  Tenant is in possession of the Premises and the Term of the Lease has
commenced.
 
C.  Landlord and Tenant desire to enter into this Memorandum confirming the
Commencement Date, the Termination Date and other matters under the Lease.
 
NOW, THEREFORE, Landlord and Tenant agree as follows:
 
1.  The actual Commencement Date is ________________.
 
2.  The actual Termination Date is ____________________.
 
3.  The schedule of the Annual Rent and the Monthly Installment of Rent set
forth on the Reference Pages is deleted in its entirety, and the following is
substituted therefor:
 
[insert rent schedule]

4.  Capitalized terms not defined herein shall have the same meaning as set
forth in the Lease.
 

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

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
as of the date and year first above written.
 

 
WITNESS:
 
 
 
 
 
 
 
 
 
By:____________________________
Name:     
Title:     
LANDLORD:
 
TMT RESTON I & II, INC.,
a Delaware corporation
 
 
By: RREEF Management Company,
a Delaware corporation
 
 
By:___________________________
Name: Patrick N. Connell 
Title: Vice President / Regional Director
Dated:________________________
   
ATTEST:
 
 
 
By:_____________________________
Name:
Title:
 
 
[Corporate Seal]
TENANT:
 
TALK AMERICA INC.,
a Pennsylvania corporation
 
By:______________________________
Name:
Title:
Dated:________________________

 

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EXHIBIT D - RULES AND REGULATIONS
 

attached to and made a part of Lease bearing the
Lease Reference Date of 2/28/2006 between
TMT Reston I & II, Inc., as Landlord and
Talk America Holdings, Inc., as Tenant

1.  
No sign, placard, picture, advertisement, name or notice shall be installed or
displayed on any part of the outside or inside of the Building without the prior
written consent of the Landlord. Landlord shall have the right to remove, at
Tenant’s expense and without notice, any sign installed or displayed in
violation of this rule. All approved signs or lettering on doors and walls shall
be printed, painted, affixed or inscribed at Tenant’s expense by a vendor
designated or approved by Landlord. In addition, Landlord reserves the right to
change from time to time the format of the signs or lettering and to require
previously approved signs or lettering to be appropriately altered.

 
2.  If Landlord objects in writing to any curtains, blinds, shades or screens
attached to or hung in or used in connection with any window or door of the
Premises, Tenant shall immediately discontinue such use. No awning shall be
permitted on any part of the Premises. Tenant shall not place anything or allow
anything to be placed against or near any glass partitions or doors or windows
which may appear unsightly, in the opinion of Landlord, from outside the
Premises.
 
3.  Tenant shall not obstruct any sidewalks, halls, passages, exits, entrances,
elevators, or stairways of the Building. No tenant and no employee or invitee of
any tenant shall go upon the roof of the Building.
 
4.  Any directory of the Building, if provided, will be exclusively for the
display of the name and location of tenants only and Landlord reserves the right
to exclude any other names. Landlord reserves the right to charge for Tenant’s
directory listing.
 
5.  All cleaning and janitorial services for the Building and the Premises shall
be provided exclusively through Landlord. Tenant shall not cause any unnecessary
labor by carelessness or indifference to the good order and cleanliness of the
Premises. Landlord shall not in any way be responsible to any Tenant for any
loss of property on the Premises, however occurring, or for any damage to any
Tenant’s property by the janitor or any other employee or any other person.
 
6.  The toilet rooms, toilets, urinals, wash bowls and other apparatus shall not
be used for any purpose other than that for which they were constructed. No
foreign substance of any kind whatsoever shall be thrown into any of them, and
the expense of any breakage, stoppage or damage resulting from the violation of
this rule shall be borne by the Tenant who, or whose employees or invitees,
shall have caused it.
 
7.  Tenant shall store all its trash and garbage within its Premises. Tenant
shall not place in any trash box or receptacle any material which cannot be
disposed of in the ordinary and customary manner of trash and garbage disposal.
All garbage and refuse disposal shall be made in accordance with directions
issued from time to time by Landlord. Tenant will comply with any and all
recycling procedures designated by Landlord.
 
8.  Landlord will furnish Tenant two (2) keys free of charge to each door in the
Premises that has a passage way lock. Landlord may charge Tenant a reasonable
amount for any additional keys, and Tenant shall not make or have made
additional keys on its own. Tenant shall not alter any lock or install a new or
additional lock or bolt on any door of its Premises. Tenant, upon the
termination of its tenancy, shall deliver to Landlord the keys of all doors
which have been furnished to Tenant, and in the event of loss of any keys so
furnished, shall pay Landlord therefor.
 
9.  If Tenant requires telephone, data, burglar alarm or similar service, the
cost of purchasing, installing and maintaining such service shall be borne
solely by Tenant. No boring or cutting for wires will be allowed without the
prior written consent of Landlord, not to be unreasonably withheld, conditioned
or delayed.
 
10.  No equipment, materials, furniture, packages, bulk supplies, merchandise or
other property will be received in the Building or carried in the elevators
except between such hours and in such elevators as may be designated by
Landlord. The persons employed to move such equipment or materials in or out of
the Building must be acceptable to Landlord.
 
11.  Tenant shall not place a load upon any floor which exceeds the load per
square foot which such floor was designed to carry and which is allowed by law.
Heavy objects shall stand on such platforms as determined by Landlord to be
necessary to properly distribute the weight. Business machines and mechanical
equipment belonging to Tenant which cause noise or vibration that may be
transmitted to the structure of the Building or to any space in the Building to
such a degree as to be objectionable to Landlord or to any tenants shall be
placed and maintained by Tenant, at Tenant’s expense, on vibration eliminators
or other devices sufficient to eliminate the noise or vibration. Landlord will
not be responsible for loss of or damage to any such equipment or other property
from any cause, and all damage done to the Building by maintaining or moving
such equipment or other property shall be repaired at the expense of Tenant.
 
12.  Landlord shall in all cases retain the right to control and prevent access
to the Building of all persons whose presence in the judgment of Landlord would
be prejudicial to the safety, character, reputation or interests of the Building
and its tenants, provided that nothing contained in this rule shall be construed
to prevent such access to persons with whom any tenant normally deals in the
ordinary course of its business, unless such persons are engaged in illegal
activities. Landlord reserves the right to exclude from the Building between the
hours of 6 p.m. and 7 a.m. the following day, or such other hours as may be
established from time to time by Landlord, and on Sundays and legal holidays,
any person unless that person is known to the person or employee in charge of
the Building and has a pass or is properly identified. Tenant shall be
responsible for all persons for whom it requests passes and shall be liable to
Landlord for all acts of such persons. Landlord shall not be liable for damages
for any error with regard to the admission to or exclusion from the Building of
any person.
 
13.  Tenant shall not use any method of heating or air conditioning other than
that supplied or approved in writing by Landlord, such approval not to be
unreasonably withheld, conditioned or delayed. Any such existing equipment which
was previously approved by Landlord under the Prior Lease is automatically
approved under this Lease.
 
14.  Tenant shall not waste electricity, water or air conditioning. Tenant shall
keep corridor doors closed. Tenant shall close and lock the doors of its
Premises and entirely shut off all water faucets or other water apparatus and
electricity, gas or air outlets before Tenant and its employees leave the
Premises. Tenant shall be responsible for any damage or injuries sustained by
other tenants or occupants of the Building or by Landlord for noncompliance with
this rule.
 
15.  Tenant shall not install any radio or television antenna, satellite dish,
loudspeaker or other device on the roof or exterior walls of the Building
without Landlord’s prior written consent, which consent may be withheld in
Landlord’s sole discretion, and which consent may in any event be conditioned
upon Tenant’s execution of Landlord’s standard form of license agreement. Tenant
shall be responsible for any interference caused by such installation. Any such
existing equipment which was previously approved by Landlord under the Prior
Lease is automatically approved under this Lease.
 
16.  Tenant shall not mark, drive nails, screw or drill into the partitions,
woodwork, plaster, or drywall (except for pictures, tackboards and similar
office uses) or in any way deface the Premises. Tenant shall not cut or bore
holes for wires. Tenant shall not affix any floor covering to the floor of the
Premises in any manner except as approved by Landlord, such consent not to be
unreasonably withheld, conditioned or delayed. Tenant shall repair any damage
resulting from noncompliance with this rule.
 
17.  Tenant shall not install, maintain or operate upon the Premises any vending
machine without Landlord’s prior written consent, except that Tenant may install
food and drink vending machines solely for the convenience of its employees. Any
existing machines previously approved by Landlord under the Prior Lease are
automatically approved under this Lease.
 
18.  No cooking shall be done or permitted by Tenant on the Premises, except
that Underwriters’ Laboratory approved microwave ovens or equipment for brewing
coffee, tea, hot chocolate and similar beverages shall be permitted provided
that such equipment and use is in accordance with all applicable federal, state
and city laws, codes, ordinances, rules and regulations.
 
19.  Tenant shall not use in any space or in the public halls of the Building
any hand trucks except those equipped with the rubber tires and side guards or
such other material-handling equipment as Landlord may approve. Tenant shall not
bring any other vehicles of any kind into the Building.
 
20.  Tenant shall not permit any motor vehicles to be washed or mechanical work
or maintenance of motor vehicles to be performed in any parking lot.
 
21.  Tenant shall not use the name of the Building or any photograph or likeness
of the Building in connection with or in promoting or advertising Tenant’s
business, except that Tenant may include the Building name in Tenant’s address.
Landlord shall have the right, exercisable with notice and without liability to
any tenant, to change the name and address of the Building.
 
22.  Tenant requests for services must be submitted to the Building office by an
authorized individual. Employees of Landlord shall not perform any work or do
anything outside of their regular duties unless under special instruction from
Landlord, and no employee of Landlord will admit any person (Tenant or
otherwise) to any office without specific instructions from Landlord.
 
23.  Tenant shall not permit smoking or carrying of lighted cigarettes or cigars
other than in areas designated by Landlord as smoking areas.
 
24.  Canvassing, soliciting, distribution of handbills or any other written
material in the Building is prohibited and each tenant shall cooperate to
prevent the same. No tenant shall solicit business from other tenants or permit
the sale of any good or merchandise in the Building without the written consent
of Landlord.
 
25.  Tenant shall not permit any animals other than service animals, e.g.
seeing-eye dogs, to be brought or kept in or about the Premises or any common
area of the Building.
 
26.  These Rules and Regulations are in addition to, and shall not be construed
to in any way modify or amend, in whole or in part, the terms, covenants,
agreements and conditions of any lease of any premises in the Building. Landlord
may waive any one or more of these Rules and Regulations for the benefit of any
particular tenant or tenants, but no such waiver by Landlord shall be construed
as a waiver of such Rules and Regulations in favor of any other tenant or
tenants, nor prevent Landlord from thereafter enforcing any such Rules and
Regulations against any or all of the tenants of the Building.
 
27.  Landlord reserves the right to make, with notice to Tenant, such other and
reasonable rules and regulations as in its judgment may from time to time be
needed for safety and security, for care and cleanliness of the Building, and
for the preservation of good order in and about the Building. Tenant agrees to
abide by all such rules and regulations herein stated and any additional rules
and regulations which are adopted. Tenant shall be responsible for the
observance of all of the foregoing rules by Tenant’s employees, agents, clients,
customers, invitees and guests.
 

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

EXHIBIT E - FORM OF GUARANTY
 

attached to and made a part of Lease bearing the
Lease Reference Date of 2/28/2006 between
TMT Reston I & II, Inc., as Landlord and
Talk America Inc., as Tenant

CONTINUING GUARANTY OF LEASE
 
THIS CONTINUING GUARANTY OF LEASE (the “Guaranty”) is made and executed this __
day of ___________, 2004 from (i) TALK AMERICA HOLDINGS, INC., a Delaware
corporation (hereinafter referred to as “Guarantor”) to (ii) TMT RESTON I & II,
INC., a Delaware corporation, its successor and assigns (hereinafter referred to
as “Landlord”).
 
W I T N E S S E T H :
 
WHEREAS, Landlord has entered into that certain Lease Agreement with a Lease
Reference date of ______________________, 2005, (the “Lease”), whereby Landlord
has agreed to lease to Talk America Inc., a Pennsylvania corporation
(hereinafter referred to as “Tenant”) certain premises (hereinafter referred to
as the “Premises”) comprising approximately 10,019 rentable square feet of the
office building commonly known as Reston Plaza II and located at 12020 Sunrise
Valley Drive, Reston, Virginia, as described in the Lease; and
 
WHEREAS, Tenant is wholly owned by Guarantor; and
 
WHEREAS, by reason of the foregoing relationship, it is in Guarantor’s direct
interest and advantage to assist Tenant in securing Landlord’s agreement to
execute the Lease; and
 
WHEREAS, Landlord is willing to execute and deliver the Lease to Tenant only if
Guarantor guarantees to Landlord the prompt performance by Tenant of all the
covenants, terms, conditions and obligations to be performed by Tenant under the
Lease.
 
NOW, THEREFORE, in consideration of the foregoing, and for the purposes of
inducing Landlord to execute the Lease, Guarantor agrees as follows:
 

28.  
Guarantor warrants and represents to Landlord that: (a) the making and
performance of this Guaranty by Guarantor will not result in the breach of any
term, condition or provision of, or constitute a default under, any contract,
agreement or other instrument to which Guarantor is a party or by which
Guarantor may be bound, or result in a breach of any regulation, order, writ,
injunction or decree of any court or any commission, board or other
administrative agency entered in any proceeding to which Guarantor is a party or
by which it may be bound; (b) Guarantor’s representation contained in the
Recitals set forth hereinabove (all of which are incorporated herein by this
reference and made a part hereof) are true, accurate and complete; and (c) under
penalty of perjury, the written financial statements and other written
information presented to Landlord by Guarantor in connection with the Lease are
true, accurate and complete, and do not omit any material fact or amount
necessary to avoid making such statements and information misleading.

 

29.  
Guarantor hereby absolutely, unconditionally, irrevocably, jointly and
severally, guarantees to Landlord (i) the prompt and complete payment by Tenant
to Landlord of the fixed minimum rental payable by Tenant to Landlord under the
Lease, (ii) the prompt and complete payment by Tenant to Landlord of all other
sums of money payable by Tenant to Landlord under the Lease, (iii) the prompt
and complete performance by Tenant of all covenants, conditions, terms and
obligations to be performed by Tenant under the Lease, and (iv) the prompt and
complete payment by Tenant to Landlord of all damages, costs and expenses that,
by reason of the Lease, may become payable by Tenant to Landlord. Guarantor
hereby agrees to fully defend upon request (with counsel approved by Landlord),
indemnify, and hold Landlord harmless from any cost, claim, liability, damage or
expense (including, but not limited to attorneys’ fees and expenses and court
costs) which Landlord incurs in the event Tenant, as tenant, does not punctually
pay, perform, or fulfill all of its obligations under the Lease.

 

30.  
At Landlord’s request, Guarantor shall deliver to Landlord a copy, certified by
an officer of Guarantor as being a true and correct copy, of Guarantor’s most
recent audited financial statement, or, if unaudited, certified by Guarantor’s
chief financial officer as being true, complete and correct in all material
respects. Guarantor hereby authorizes Landlord to obtain one or more credit
reports on Guarantor at any time, and shall execute such further authorizations
as Landlord may reasonably require in order to obtain a credit report.

 

31.  
Guarantor’s liability hereunder shall in no way be affected by any indulgence,
extension, or forbearance which Landlord may grant to Tenant with respect to the
payment or performance of any obligation of Tenant, or any waiver, on the part
of Landlord of any breach of the Lease by Tenant; and Guarantor waives any
requirement that Guarantor be notified of any such indulgence, extension,
forbearance or waiver, and Guarantor waives notice of such matters and of any
default by Tenant under the Lease.

 

32.  
In the event of the default by Tenant in the performance of any of its covenants
or obligations under the Lease, Guarantor covenants and agrees to perform such
obligations forthwith upon demand (in the same manner as if the same constituted
the direct primary obligation and liability of Guarantor), including, without
limitation, payments of all sums owing to Landlord by reason of such default.

 

33.  
Landlord shall have the right, at any time and from time to time, to enforce all
rights and remedies available to Landlord under the Lease, including, without
limitation, agreements with Tenant modifying or changing any of the terms of
provisions of the Lease, extending or renewing the time of payment of any such
payable under the Lease, compromising or making settlement of any obligation of
Tenant under the Lease, terminating the Lease or resuming possession of the
Premises, making demand upon or instituting legal proceedings against Tenant,
granting any indulgence, extension or forbearance to Tenant with respect to the
performance of any obligation of Tenant, or waiving any breach of the Lease by
Tenant, all without notice to, or consent of, Guarantor and without affecting
the continuing validity and enforceability of this Guaranty.

 

34.  
Provided Landlord gives Tenant proper notice as may be set forth in the Lease,
Landlord may make demand and/or institute legal proceedings against Guarantor
for the performance of any obligation of Tenant under the Lease without first
proceeding in any way against Tenant and without enforcing any rights or
remedies under the Lease.

 

35.  
No reasonable delay of the Landlord in exercising any rights and/or powers
hereunder or in taking any action to enforce the performance of Tenant’s
obligations under the Lease shall operate as a waiver as to such rights or
powers or in any manner prejudice any or all of Landlord’s rights and powers
hereunder against Guarantor.

 

36.  
All claims which Guarantor may have against Tenant by reason of this Guaranty,
whether by way of subrogation to any position of Landlord or for contribution or
reimbursement, shall be subordinate to any outstanding claims which Landlord
then has against Tenant. Guarantor hereby releases Landlord from all liability
to Guarantor or Tenant for failing to recognize or observe or protect any legal
or equitable rights of Guarantor with respect to Tenant or the Premises or the
Lease.

 

37.  
This Guaranty may not be modified, altered or terminated except pursuant to an
instrument in writing executed by Guarantor and Landlord. No waiver of any
provision of this Guaranty shall be valid unless in writing and signed by
Landlord. A failure of Landlord to insist upon strict performance of any
obligation or covenant of Guarantor under this Guaranty in any one or more
instances shall not be construed as a waiver or relinquishment of the right to
insist upon strict performance of such obligation or covenant in the future.

 

38.  
This Guaranty shall be construed and enforced in accordance with the laws of the
Commonwealth of Virginia. Guarantor hereby waives notice of nonpayment,
nonperformance, or nonobservance or any notice of acceptance of this Guaranty
and any other notice to or demand upon Guarantor which Landlord might otherwise
be required to give or make in connection with any matter relating to this
Guaranty. Guarantor waives any legal obligation, duty or necessity for Landlord
to proceed first against Tenant, as tenant, or to exhaust any remedy Landlord
may have against Tenant, as tenant, it being agreed that in the event of a
default or failure in performance in any respect by Tenant, as tenant under the
Lease, Landlord may proceed and have the right of action solely against
Guarantor and/or any other guarantor of the Lease or Tenant, as tenant or
jointly against Guarantor and/or any other guarantor of the Lease and Tenant, as
tenant. Furthermore, to the extent applicable, Guarantor hereby waives the
benefit of Sections 49-25 and 49-26 of the Code of Virginia (2001) as amended.
Guarantor hereby expressly, knowingly and irrevocably consents and waives any
objection to the jurisdiction of any state or federal court situated within the
Commonwealth of Virginia over any suit, action or proceeding whether for damages
or for injunction, specific performance or for any other prohibitory or
mandatory relief arising out of or relating to this Lease. Guarantor hereby
expressly, knowingly and irrevocably agrees that all claims in respect of such
suit, action or proceeding may be heard and determined in such state or federal
court situated within the Commonwealth of Virginia. Having received the advice
of competent legal counsel, Guarantor hereby expressly, knowingly, and
irrevocably waives, to the fullest extent it may effectively do so, objection to
defending any such suit, action or proceedings in such state or federal court,
based on the defense of forum non conveniens (inconvenient forum) for the
maintenance of such suit, action or proceeding. Guarantor appoints hereby
Aloysius T. Lawn as agent for the purpose of accepting service of process
(“Guarantor’s Agent”). Should Guarantor’s Agent be unavailable, disabled, or
otherwise unable or unwilling to accept service of process, Guarantor appoints
the Clerk of the Virginia State Corporation Commission, or such other official
provided for under the laws of the Commonwealth of Virginia, as agent for the
service of process. Guarantor hereby expressly, knowingly, and irrevocably
consents to service of all writs, processes and summons in any such suit, action
or proceeding by mailing thereof to either (a) Guarantor at Guarantor’s Notice
Address (defined herein) or (b) Guarantor’s Agent’s Notice Address (or the
Secretary of the Commonwealth), by United States certified mail, postage
prepaid, return receipt requested or by Federal Express overnight delivery,
courier charges prepaid, signature of recipient required. Guarantor also hereby
expressly, knowingly and irrevocably consents and waives any objection to the
enforcement by execution against property or otherwise of any relief ordered in
such suit, action or proceeding in any federal or state court of the United
States or any court of any foreign state. The consent and waiver under this
paragraph shall not limit the rights of Landlord to bring any suit, action or
proceeding against Guarantor in any other jurisdiction for such relief, or of
any party to serve process in any other manner permitted by law, or to obtain
execution of judgment in any jurisdiction.

 

39.  
All notices required or desired to be given by either party to the other under
this Guaranty shall be in writing and shall be personally delivered or sent by
nationally available overnight courier or by certified mail, return receipt
requested, postage prepaid, and shall be effective upon actual receipt as
verified by written acknowledgement of delivery (or upon the date such delivery
is refused) in the case of personal or overnight delivery and by the return
receipt (or upon the date such delivery is refused) in the case of certified
mail. A party shall designate a change of address or agent by notice to the
other party at least ten (10) days before such change is to become effective.
All notices to the respective parties shall be addressed and sent as follows
(the “Notice Address”):

 
Landlord: TMT Reston I & II, Inc.
c/o RREEF
8280 Greensboro Drive
Suite 550
McLean, Virginia 22102
Attn: Patrick N. Connell, Vice President / Regional Director

with a copy, said copy not constituting notice, to:

Covington & Burling
1201 Pennsylvania Avenue, N.W.
Washington, D.C. 20004
Attn: Robert J. Gage, Esq.
 

 
Guarantor: Talk America Holdings, Inc.
6805 Route 202
New Hope, PA 18938
Attn: Bill McGrath, Senior VP

with a copy, said copy also constituting notice, to Guarantor’s Agent :
 
Aloysius T. Lawn, General Counsel
Talk America Holdings, Inc.
6805 Route 202
New Hope, PA 18938

 

40.  
This Guaranty shall be binding upon Guarantor, its successor or assigns, and
shall inure to the benefit of, and be enforceable by Landlord, its successors or
assigns, and by any successor to the interest of landlord under the Lease.

 

41.  
Guarantor shall pay to Landlord all costs, including without limitation
attorneys’ fees and expenses, court costs, expert witness fees, and other
disbursements and costs of collection, incurred by Landlord in connection with
enforcing any provision of this Guaranty, whether or not any action or lawsuit
is actually instituted by Landlord.

 

42.  
This Guaranty is absolute and is not conditioned in any way upon the
genuineness, validity, regularity or enforceability of the Lease, provided that
the Lease was signed by Tenant.

 

43.  
Guarantor’s obligations under this Guaranty shall be unaffected by any discharge
or release of the Tenant, its successors or assigns, or any of their debts, in
connection with any bankruptcy, reorganization, or other insolvency proceeding
or assignment for the benefit of creditors; any rejection or disaffirmation of
the Lease in any bankruptcy, reorganization, or other insolvency proceeding or
assignment for the benefit of creditors; or any reduction, modification,
impairment or limitation of the liability of the Tenant, its successors or
assigns, or of Landlord’s remedies under the Lease, in connection with any
bankruptcy, reorganization or other insolvency proceeding or any assignment for
the benefit of creditors. In addition, if Landlord is required to disgorge or
pay back to the Tenant’s estate any payments made by the Tenant under the Lease
in connection with any bankruptcy, reorganization or insolvency proceeding,
Guarantor’s obligations as to such payments shall be reinstated.

 

44.  
In the event that any covenant, condition or other provision herein contained is
held to be invalid, void or illegal by any court of competent jurisdiction, the
same shall be deemed severable from the remainder of this agreement and shall in
no way affect, impair or invalidate any other covenant, condition or other
provision herein contained.

 
[SIGNATURES ON NEXT PAGE]

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

 
IN WITNESS WHEREOF, the undersigned have executed this Guaranty on the day and
year first above written
 
 
 
ATTEST:
 
 
By: /s/ Craig H. Pizer
Name: Craig H. Pizer
Title: Associate General Counsel
Date: 9-19-05
GUARANTOR:
 
Talk America Holdings, Inc.,
a Delaware corporation
 
 
By: /s/ Aloysius T. Lawn IV
Name: Aloysius T. Lawn IV
Title: EVP - General Counsel
Date: 9-19-05

[corporate seal]

CITY     ) ss:
 
STATE    )
 
BEFORE ME, a Notary Public in and for the jurisdiction aforesaid, personally
appeared this date _______________________________, personally well known (or
satisfactorily proven) to me to be the person whose name is subscribed to the
foregoing and annexed Guaranty bearing date as of ________________ ___, 2004,
who, being by me first duly sworn, did depose and state that he/she is the
_______________________________ of Talk America Holdings, Inc., a Delaware
corporation, which entity is a party of the foregoing and annexed Guaranty, and
that he/she, being duly authorized so to do, executed said Guaranty on behalf of
said entity and acknowledge the same as its free act and deed for the uses and
purposes herein contained.
 
SUBSCRIBED AND SWORN TO before me this ___ day of _____________, 2005.
 

 
[notary seal]     _____________________________________
Notary Public
My Commission expires:

________________________