Exhibit 10.7

 

OFFICE LEASE

 

49 STEVENSON STREET

SAN FRANCISCO, CALIFORNIA

 

BASIC LEASE INFORMATION

 

Date: July 28, 2005

 

Landlord: OP&F Stevenson Street Corporation, a California corporation

 

Tenant: Lionbridge U.S., Inc., a Delaware corporation

 

Premises (Section 1.1): Suite 1400, approximately 7,721 rentable square feet
located on the fourteen (14th) floor of the Building.

 

Term (Section 2.1): One (1) year

 

Commencement Date (Section 2.1): August 1, 2005

 

Expiration Date (Section 2.1): One (1) year from the Commencement Date, unless
sooner terminated or extended as provided in the Lease.

 

Base Rent (Section 3.1 (a)):

 

(a)

   The Rent Commencement Date through the    $ 204,606.50    annual     
Expiration Date    $ 17,050.54    monthly

 

Base Expanse Year (Section 3.1(b)):

   2005     

Base Tax Year (Section 3.l(c)):

   2005     

 

Tenant’s Percentage Share (Section 4.1): 6.37%, based on the rentable square
footage of the Premises as being 7,721 rsf, and on the rentable square footage
of the Building as being 121,179 rsf.

 

Permitted Use (Section 6.1): General office use and, subject to the terms of the
Lease, uses incidental thereto that are in keeping with the character of the
Building as a quality high-rise downtown office building.

 

Liability Insurance (Section 11.1):

   $2,000,000     

Deposit (Section 22.1):

   $17,050.54     

 

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Landlord’s Address (Section 24.1):   

OP&F Stevenson Street Corporation

RREEF as agent for OP&F Stevenson

49 Stevenson Street, Suite 460

San Francisco, California 94105

Attn: Lisa Vogel

     With a copy (which shall not constitute notice) to:     

Cathy L. Croshaw, Esq.

Luce, Forward, Hamilton & Scripps, LLP

121 Spear Street, Suite 200

San Francisco, California 94105

Notices to Manager:    RREEF as agent for OP&F Stevenson
49 Stevenson Street, Suite 460
San Francisco, California 94105
Attn: Property Manager Tenant’s Address (Section 24.1):   

Lionbridge U.S., Inc.

49 Stevenson Street, Suite 1400

San Francisco, California 94105

Attn:                     

With a copy to:   

Lionbridge Technologies, Inc.

1050 Winter Street, Suite 2300

Waltham, Massachusetts 02451

Attn: Mark Branciforte

Real Estate Broker(s) (Section 25.5):    Landlord’s Broker:     

Cushman & Wakefield of California

One Maritime Plaza

San Francisco, California 94111

     Tenant’s Broker:     

Grubb & Ellis

255 California Street, 14th Floor

San Francisco, California 94111

Guarantor:

   Lionbridge Technologies, Inc., a Delaware corporation will guaranty Tenant’s
obligations under this Lease pursuant to separate written guaranty agreement to
be executed concurrently with this Lease.

 

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The foregoing Basic Lease Information is incorporated in and made a part of the
Lease to which it is attached. If there is any conflict between the Basic Lease
Information and the Lease, the Lease shall control.

 

LANDLORD:       TENANT:

OP&F STEVENSON STREET

CORPORATION

a California corporation

     

LIONBRIDGE U.S., INC., a

Delaware corporation

By:

 

RREEF MANAGEMENT

COMPANY,

a Delaware corporation, its Manager

               

By:

  LOGO [g24780img_011.jpg]      

By:

  LOGO [g24780img_012.jpg]         Lisa Vogel,       Print Name   David W Dahn  
      Vice President and District Manager      

Its:

  Treasurer

 

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THIS LEASE, made as of the date specified in the Basic Lease Information, by and
between OP&F STEVENSON STREET CORPORATION, a California corporation
(“Landlord”), and LIONBRIDGE U.S., INC., a Delaware corporation (“Tenant”).

 

W I T N E S S E T H:

 

1. PREMISES

 

1.1. Landlord hereby leases to Tenant, and Tenant hereby leases from Landlord,
for the term and subject to the covenants hereinafter set forth, to all of which
Landlord and Tenant hereby agree, the space on the floor(s) specified in the
Basic Lease Information (the “Premises”), as outlined on the floor plan(s)
attached hereto as Exhibit A, in that certain 15 story office building located
at 49 Stevenson Street, San Francisco, California 94105 owned by Landlord (the
“Building”). As used in this Lease, the Building includes all of the land on
which the Building is located and all appurtenances thereto. Tenant shall have
the right to use, in common with others, the entrances, lobbies, corridors,
stairs and elevators of the Building (the “Common Areas”) for access to the
Premises. All of the exterior windows and exterior walls of the Building and any
space in the Premises used for shafts, stacks, pipes, conduits, ducts, electric
or other utilities, sinks or other Building facilities, and the use thereof and
access thereto through the Premises for the purposes of operation, maintenance
and repairs, are reserved to Landlord. If the Premises provide access to any
outdoor balconies or decks, these areas shall be used exclusively for
maintenance and repair of any structural elements of the Building located
thereon, including roof and roof membrane elements, and for the use of exterior
window cleaning equipment and Landlord reserves the right, upon prior notice to
Tenant, to enter upon such facilities through the Premises for purposes of
performing such maintenance.

 

1.2. Provided that Tenant’s reasonable access to the Building and the Premises
are maintained, Landlord may change the location, size and configuration of the
Common Areas, close temporarily or permanently any Common Areas, add additional
improvements to the Common Areas or do and perform such other acts and make such
other changes to or use of the Common Areas as Landlord may, in the exercise of
its sound business judgment, deem to be appropriate, and such change or
improvement to or closure or use of the Common Areas by Landlord shall in no way
affect this Lease or impose any liability on Landlord.

 

1.3. No easement for light, air or view is included with or appurtenant to the
Premises. Any diminution or shutting off of light, air or view by any structure
which may hereafter be erected (whether or not constructed by Landlord) shall in
no way affect this Lease or impose any liability on Landlord. Tenant shall have
no right of access to, or use of, the roof of the Building.

 

1.4. Landlord and Tenant acknowledge and agree that the rentable square footage
of the Premises has been calculated by Landlord in accordance with standards of
measurement adopted by the Building Owners and Managers Association, American
Standard, ANSI/BOM A Z.65.1-1996, as modified by Landlord for uniform use in the
Building, and said square footage figures provided in the Basic Lease
Information shall be final and binding on Landlord and Tenant for all purposes
under this Lease; provided, however, Landlord reserves the right to adjust the
square footage figures based on modifications or alterations to the Building, as

 

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evidenced by written verification of Landlord’s space planner as to the revised
rentable square footage figures.

 

2. TERM

 

2.1. Subject to the provisions of this Section 2.1, the term of this Lease shall
be the term specified in the Basic Lease Information. The term of this Lease
shall commence on the Commencement Date specified in the Basic Lease
Information. Unless sooner terminated or extended as hereinafter provided, the
term of this Lease shall end on the Expiration Date specified in the Basic Lease
Information (the “Expiration Date”).

 

2.2.

 

(a) On the Commencement Date Landlord will be deemed to have delivered
possession of the Premises to Tenant in its “as-is” condition and configuration
and Tenant shall accept such delivery of the Premises, which acceptance shall
constitute the agreement of Tenant that the Premises are in the condition
required by this Lease, and Tenant waives any and all defects therein.

 

(b) Tenant acknowledges that the Premises have been previously built-out and
improved for occupancy by a prior tenant and that the HVAC, life safety,
plumbing, electrical and other Building systems serving and located in the
Premises have been configured for the use of the prior tenant and, no
re-engineering of any Building system is contemplated as a condition to the
delivery of the Premises to Tenant. The Premises will be delivered to Tenant
with all Building systems serving and located in the Premises in good working
order; provided, however, Landlord makes no representation or warranty as to,
and Tenant waives as against and releases Landlord from any and all claims based
on, any physical condition at the Premises as of the date of this Lease, or on
the configuration or compatibility of any Building systems existing in the
Premises as of the date of this Lease with Tenant’s use and occupancy of the
Premises.

 

(c) Except for use of the Premises for office purposes, Tenant acknowledges that
neither Landlord nor any agent of Landlord has made any representation or
warranty with respect to the suitability or fitness of the Premises or the
Building for the conduct of Tenant’s business.

 

2.3. Tenant shall deliver to Landlord the insurance policies or certified copies
and a certificate of insurance with respect thereto required by Section 11.2
hereof prior to, and as a condition of, Tenant’s initial entry upon or occupancy
of the Premises.

 

3. RENT

 

3.1. Tenant shall pay to Landlord the following amounts as rent for the
Premises:

 

(a) During the term of this Lease, Tenant shall pay to Landlord, as base monthly
rent, the amount of monthly rent specified in the Basic Lease Information (the
“Base Rent”). The date on which Tenant’s obligation to pay Base Rent commences
is referred to as the “Rent Commencement Date”.

 

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(b) During each calendar year or part thereof during the term of this Lease
subsequent to the base expense calendar year specified in the Basic Lease
Information (the “Base Expense Year”), Tenant shall pay to Landlord, as
additional monthly rent, Tenant’s Percentage Share (as hereinafter defined) of
the total dollar increase, if any, in all Operating Expenses (as hereinafter
defined) paid or incurred by Landlord in such calendar year or part thereof over
the Operating Expenses paid or incurred by Landlord in the Base Expense Year.

 

(c) During each tax year (July 1 through June 30) or part thereof during the
term of this Lease subsequent to the base tax year ending June 30 of the year
specified in the Basic Lease Information (the “Base Tax Year”), Tenant shall pay
to Landlord, as additional monthly rent, Tenant’s Percentage Share of the total
dollar increase, if any, in all Property Taxes (as hereinafter defined) paid or
incurred by Landlord in such tax year or part thereof over the Property Taxes
paid or incurred by Landlord in the Base Tax Year.

 

(d) From and after execution of this Lease (whether accruing prior to or after
commencement of the term of this Lease), Tenant shall pay, as additional rent,
all other amounts of money and charges required to be paid by Tenant under this
Lease, whether or not such amounts of money or charges are designated
“additional rent”. As used in this Lease, “rent” shall mean and include Base
Rent, additional monthly rent and additional rent payable by Tenant in
accordance with this Lease.

 

3.2. The additional monthly rent payable pursuant to Sections 3.1 (b) and 3.1(c)
hereof shall be calculated and paid in accordance with the following procedures:

 

(a) On or before the first day of each calendar year during the term of this
Lease other than during the Base Expense Year and the Base Tax Year, or as soon
thereafter as practicable, Landlord shall give Tenant written notice of
Landlord’s estimate of the amounts payable under Sections 3.1(b) and 3.1(c)
hereof for the ensuing calendar year. On or before the first day of each month
during such ensuing calendar year, Tenant shall pay to Landlord one twelfth of
such estimated amounts. If such notice is not given for any calendar year,
Tenant shall continue to pay on the basis of the prior year’s estimate until the
month after such notice is given, and subsequent payments by Tenant shall be
based on Landlord’s current estimate. If at any time it appears to Landlord that
the amounts payable under Sections 3.1 (b) and 3.1(c) hereof for the current
calendar year will vary from Landlord’s estimate, Landlord may, by giving
written notice to Tenant, revise Landlord’s estimate for such year, and
subsequent payments by Tenant for such year shall be based on such revised
estimate.

 

(b) Within a reasonable time after the end of each calendar year, Landlord shall
give Tenant a written statement of the amounts payable under Sections 3.1
(b) and 3.1(c) hereof for such calendar year certified by Landlord. If such
statement shows an amount owing by Tenant that is less than the estimated
payments for such calendar year previously made by Tenant, Landlord shall credit
the excess to the next succeeding monthly installments payable under Sections
3.1 (b) and 3.1(c) hereof. If such statement shows an amount owing by Tenant
that is more than the estimated payments for such calendar year previously made
by Tenant, Tenant shall pay the deficiency to Landlord within ten (10) days
after delivery of such statement. Tenant or Tenant’s authorized agent or
representative shall have the right to inspect the books of Landlord relating to
Operating Expenses and Property Taxes, after giving reasonable prior

 

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written notice to Landlord within ninety (90) days of Landlord’s statement, and
during the business hours of Landlord at Landlord’s office in the Building or at
such other location as Landlord may designate, for the purpose of verifying the
information in such statement. Landlord’s statement shall be deemed final and
binding on Tenant, absent such a request by Tenant. If Tenant shall have availed
itself of its right to inspect the books and records, and whether or not Tenant
disputes the accuracy of the information set forth in such books and records,
Tenant shall nevertheless pay the amount set forth in Landlord’s statement and
continue to pay the amounts required by the provisions of this Article 3,
pending resolution of said dispute. Any default in the payment of such charges
by Tenant shall be deemed an Event of Default under this Lease. If and to the
extent Tenant disputes the accuracy of Landlord’s books and records, such claim
shall be based on an inspection conducted by an independent certified public
accountancy firm engaged by Tenant (and not compensated on a contingency basis)
reasonably acceptable to Landlord. If Tenant’s dispute is resolved in favor of
Tenant and it is determined that Landlord’s statement overstated Operating
Expenses and Property Taxes for the year in question by five percent (5%) or
more, Landlord shall reimburse Tenant for the reasonable costs of Tenant’s
accountant in performing the inspection provided for in this paragraph.

 

(c) Failure by Landlord to give any notice or statement to Tenant under
Section 3.2(b) shall not waive Landlord’s right to receive, or Tenant’s
obligation to pay, the amounts payable by Tenant under Section 3.1(b) and 3.1(c)
hereof. If the term of this Lease ends on a day other than the last day of a
calendar year, the amounts payable by Tenant under Sections 3.1(b) and 3.1(c)
hereof applicable to the calendar year in which such term ends shall be prorated
according to the ratio which the number of days in such calendar year to and
including the end of the term bears to three hundred sixty five (365).
Termination of this Lease shall not affect the obligations of Landlord and
Tenant pursuant to Section 3.2(b) hereof to be performed after such termination.

 

3.3. Tenant shall pay all Base Rent and additional monthly rent under
Section 3.1 hereof to Landlord, in advance, on or before the first day of each
and every calendar month during the term of this Lease, except that Base Rent
for the first full calendar month of the term of this Lease (the “First Month”)
shall be paid upon execution of this Lease. If the Rent Commencement Date occurs
on any day other than the first day of a calendar month, Base Rent for the
period from the Rent Commencement Date through the end of said calendar month
shall be due and payable on the Rent Commencement Date, and the Base Rent
payable upon execution of this Lease shall be credited against the Base Rent due
for the First Month as of the first day of the First Month. Tenant shall pay all
rent to Landlord without notice, demand, deduction or offset, in lawful money of
the United States of America, at the address of Landlord specified in the Basic
Lease Information, or to such other person or at such other place as Landlord
may from time to time designate in writing. If the Commencement Date as
determined in accordance with Section 2.1 hereof is not the first day of the
month and the Expiration Date is not the last day of the month, then the rent
for the fractional month shall be appropriately prorated.

 

4. OPERATING EXPENSES AND PROPERTY TAXES

 

4.1. As used in this Lease, “Tenant’s Percentage Share” shall mean the
percentage specified in the Basic Lease Information.

 

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4.2. As used in this Lease, “Operating Expenses” shall mean all costs and
expenses paid or incurred by Landlord in connection with the ownership,
management, operation, maintenance or repair of the Building or in providing
services in accordance with this Lease, including, without limitation, the
following: salaries, wages, other compensation, taxes and benefits (including
payroll, social security, workers’ compensation, unemployment, disability and
similar taxes and payments) for all personnel engaged in the management,
operation, maintenance or repair of the Building; uniforms provided to such
personnel; premiums, deductibles and other charges for all property, earthquake,
rental value, liability and other insurance carried by Landlord; water and sewer
charges or fees; license, permit and inspection fees; electricity, chilled
water, air conditioning, gas, fuel, steam, heat, light, power and other
utilities; sales, use and excise taxes on goods and services purchased by
Landlord; telephone, delivery, postage, stationery supplies and other expenses;
management fees and expenses; equipment lease payments; repairs to and
maintenance of the Building, including Building systems and accessories thereto
and repair and replacement of worn out or broken equipment, facilities, parts
and installations, but excluding the replacement of major Building systems;
janitorial, window cleaning, concierge, guard, extermination, water treatment,
garbage and waste disposal, rubbish removal, plumbing and other services;
inspection or service contracts for elevator, electrical, mechanical, life
safety and other Building equipment and systems; intra-Building network cable
maintenance and repair; supplies, tools, materials and equipment; accounting,
legal and other professional fees and expenses (excluding legal fees incurred by
Landlord relating to disputes with specific tenants or the negotiation,
interpretation or enforcement of specific leases); painting the exterior or the
public or Common Areas of the Building and the cost of maintaining the
sidewalks, landscaping and other Common Areas of the Building; the cost,
reasonably amortized as determined by Landlord with interest at the rate of ten
percent (10%) per annum, or such higher rate as Landlord may actually have to
pay, on the unamortized balance, of any and all furniture, fixtures, draperies,
carpeting and personal property (excluding paintings, sculptures or other works
of fine art) furnished by Landlord in the Common Areas of the Building or in the
Building office; all costs and expenses resulting from compliance with any laws,
ordinances, rules, regulations or orders applicable to the Building; Building
office rent or rental value for office space reasonably necessary for the proper
management and operation of the Building; all costs and expenses of contesting
by appropriate legal proceedings any matter concerning managing, operating,
maintaining or repairing the Building, or the validity or applicability of any
law, ordinance, rule, regulation or order relating to the Building, or the
amount or validity of any Property Taxes; the amortized cost of the Transit
Impact Development Fee of the City and County of San Francisco applicable to the
Building; reasonable depreciation as determined by Landlord on all machinery,
fixtures and equipment (including window washing machinery) used in the
management, operation, maintenance or repair of the Building and on window
coverings provided by Landlord; and the cost, reasonably amortized as determined
by Landlord, with interest at the rate of ten percent (10%) per annum, or such
higher annual rate as Landlord may actually have to pay, on the unamortized
balance, of all capital improvements made to the Building or capital assets
acquired by Landlord that are designed or intended to be a labor saving or
energy saving device, or to improve economy or efficiency in the management,
operation, maintenance or repair of the Building, or to reduce any item of
Operating Expenses, or to improve life safety or indoor air quality conditions
in the Building, or that are reasonably necessary to comply with any
conservation program or required by any law, ordinance, rule, regulation or
order. Operating

 

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Expenses shall not include Property Taxes; depreciation on the Building (except
as described above), costs of tenant improvements, real estate brokers
commissions, and other costs incurred in negotiating any leases, lease
amendments or other leasing transactions with existing or prospective tenants of
the Building; interest (except as described above) or capital items (except as
described above). Actual Operating Expenses for the Base Expense Year and each
subsequent calendar year shall be adjusted, if necessary, to equal Landlord’s
reasonable estimate of Operating Expenses for a full calendar year with the
total area of the Building occupied during such full calendar year. The
determination of Operating Expenses shall be in accordance with generally
accepted accounting principles applied on a consistent basis.

 

4.3. As used in this Lease, “Property Taxes” shall mean all taxes, assessments,
excises, levies, fees and charges (and any tax, assessment, excise, levy, fee or
charge levied wholly or partly in lieu thereof or as a substitute therefor or as
an addition thereto) of every kind and description, general or special, ordinary
or extraordinary, foreseen or unforeseen, secured or unsecured, whether or not
now customary or within the contemplation of Landlord and Tenant, that are
levied, assessed, charged, confirmed or imposed by any public or government
authority on or against, or otherwise with respect to, the Building or any part
thereof or any personal property used in connection with the Building, or any
taxes or assessments levied against or measured by the gross rentals received by
Landlord from the Building or in connection with the business of renting space
in the Building, or any charge or fee imposed by any federal, state or local
government, district or agency for fire protection, trash removal, sidewalk,
street maintenance or other public service(s). Property Taxes shall not include
net income (measured by the income of Landlord from all sources or from sources
other than solely rent), franchise, documentary transfer, inheritance or capital
stock taxes of Landlord, unless levied or assessed against Landlord in whole or
in part in lieu of, as a substitute for, or as an addition to any Property
Taxes. Property Taxes shall not include any tax, assessment, excise, levy, fee
or charge paid by Tenant pursuant to Section 5.1 hereof.

 

5. OTHER TAXES PAYABLE BY TENANT

 

5.1. In addition to all monthly rent and other charges to be paid by Tenant
under this Lease, Tenant shall reimburse Landlord upon demand for all taxes,
assessments, excises, levies, fees and charges, including all payments related
to the cost of providing facilities or services, whether or not now customary or
within the contemplation of Landlord and Tenant, that are payable by Landlord
and levied, assessed, charged, confirmed or imposed by any public or government
authority upon, or measured by, or reasonably attributable to (a) the Premises,
(b) the cost or value of Tenant’s equipment, furniture, fixtures and other
personal property located in the Premises or the cost or value of any leasehold
improvements made in or to the Premises by or for Tenant as outlined in this
Lease, regardless of whether title to such improvements is vested in Tenant or
Landlord, (c) the possession, leasing, operation, management, maintenance,
alteration, repair, use or occupancy by Tenant of the Premises, or (d) this
transaction or any document to which Tenant is a party creating or transferring
an interest or an estate in the Premises. All taxes, assessments, excises,
levies, fees and charges payable by Tenant under this Section 5.1 shall be
deemed to be, and shall be paid as, additional rent.

 

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6. USE

 

6.1. Tenant shall use and occupy the Premises solely for the Permitted Use
provided in the Basic Lease Information and for no other purpose. Tenant shall
not do or permit to be done in, on or about the Premises, nor bring or keep or
permit to be brought or kept therein, anything which is prohibited by or will in
any way conflict with any law, ordinance, rule, regulation or order now in force
or which may hereafter be enacted, or which is prohibited by any insurance
policy carried by Landlord for the Building, or which will in any way increase
the existing rate of, or cause a cancellation of, or affect any insurance for
the Building. Tenant shall not bring, keep, discharge or release or permit to be
brought, kept, discharged or released, in or from the Premises or the Building
any toxic or hazardous substance, material or waste or any other contaminant or
pollutant, other than nonreportable quantities of such substances when found in
commonly used household cleansers, office supplies and general office equipment,
and any such substances shall be used, kept, stored and disposed of in strict
accordance with all applicable federal, state and local laws. Tenant shall
comply with all applicable federal, state and local reporting and disclosure
requirements applicable to its business operations in the Premises. 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 rights of Landlord or other tenants of the
Building, or injure or annoy them. Tenant shall not cause, maintain or permit
any nuisance in, on or about the Premises or commit or suffer to be committed
any waste in, on or about the Premises.

 

6.2. Tenant shall not conduct or permit any retail or wholesale sale of goods or
merchandise, or sale of goods or merchandise to the trade, in the Premises, nor
may Tenant use any portion of the Premises, for a medical or dental office; an
office providing any type of psychological, parole or drug counseling;
telemarketing operations; consulate, foreign mission or trade office; government
or regulatory agency office or similar uses. Solicitations or promotions by
Tenant to other tenants in the Building are prohibited. Tenant shall not bring
or keep in the Premises any furniture, equipment, materials or other objects
which overload the Premises or any portion thereof in excess of fifty
(50) pounds per square foot live or dead load and twenty (20) pounds per square
foot partition load, which are the normal load bearing capacities of the floors
and walls of the Building, nor shall Tenant permit the general office operations
in the Premises to be conducted in such a manner that the Premises are occupied
by more than one (1) person per one hundred (100) square feet of usable area, or
that the usage of electric current or HVAC (as hereinafter defined) services
exceeds the capacity of existing Building systems.

 

6.3. Except as permitted under Section 6.1, Tenant shall notify Landlord
immediately upon discovery of the presence, discharge or release of any
hazardous or toxic substance in or around the Premises or the Building. Upon the
written request of Landlord, Tenant shall provide periodic written reports of
the type and quantities of hazardous substances, materials, waste and
contaminants used, stored or being disposed of by Tenant in the Premises. If
Landlord in good faith determines that such substances create a risk to the
health and safety of the Tenant’s employees and invitees or to any other tenant
or invitee of the Building, Tenant shall, upon demand by Landlord, take such
remedial action, at the sole cost and expense of Tenant (including, without
limitation, elimination or removal of any hazardous substances from the
Premises), as Landlord deems necessary or advisable or as required by any
applicable law.

 

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7. SERVICES

 

7.1. Landlord shall supply the Premises with electricity for general office
lighting and the operation of desk top office machines, water for lavatory and
drinking purposes and, during reasonable and usual business hours, as determined
by Landlord and subject to the Rules and Regulations (as hereinafter defined)
established by Landlord, heating, ventilating and air conditioning reasonably
required for the use and occupancy of the Premises for general office purposes.
Landlord shall also furnish normal elevator service to the Premises at all
times, and lighting replacement for Building standard lights, restroom supplies
and window washing when needed, as determined by Landlord and subject to the
Rules and Regulations. Landlord shall furnish normal janitorial service to the
Premises during the times and in the manner that such service is customarily
furnished in comparable office buildings in the area. Landlord shall not be
liable for any criminal acts of others or for any direct, consequential or other
loss or damage related thereto. Landlord shall not be in default under this
Lease or be liable for any damage or loss directly or indirectly resulting from,
nor shall the rent be abated or a constructive or other eviction be deemed to
have occurred by reason of, any installation, use or interruption of use of any
equipment in connection with the furnishing of any of the foregoing services,
any failure to furnish or delay in furnishing any such services when such
failure or delay is caused by accident or breakdown or any condition beyond the
control of Landlord or by the making of repairs or improvements to the Premises
or to the Building, or any limitation, curtailment, rationing or restriction on
use of water, electricity, gas or any resource or form of energy serving the
Premises or the Building, whether such results from mandatory restrictions or
voluntary compliance with guidelines. Landlord shall use reasonable efforts to
correct any interruption in the furnishing of such services.

 

7.2. Tenant acknowledges that the heating, air conditioning and ventilating
(“HVAC”) system of the Building is designed to operate efficiently while
electrical equipment such as customary lamps, desktop computers and other small
fractional horsepower desktop office machines are being used in the Premises and
while the Premises are occupied in any HVAC zone by not more than one person per
one hundred (100) square feet of usable area therein. If the temperature
otherwise maintained in any portion of the Premises by the HVAC system of the
Building is affected by (a) Tenant’s use of any lights, machines or equipment
(including, without limitation, computers, telecommunications equipment and
copying machines), or (b) the occupancy of the Premises by more than one person
per one hundred (100) square feet of usable area, or (c) an electrical load that
generates heat in excess of 3.413 BTUs per square foot per hour of usable area,
Landlord shall have the right, unless Tenant ceases and desists from such usage
or excess occupancy within five (5) days after written notice from Landlord, to
install any machinery and equipment that Landlord reasonably deems necessary to
restore temperature balance, including, without limitation, modifications to the
standard air conditioning equipment, and the cost thereof, including the cost of
installation and any additional cost of operation and maintenance incurred
thereby, shall be paid by Tenant to Landlord, as additional rent, upon billing
by Landlord.

 

7.3. Without the prior written consent of Landlord, which Landlord may refuse in
its sole discretion, Tenant shall not: (a) connect or use any electrical
equipment that exceeds the capacity of the Building electrical system panel
serving the Premises; or (b) connect any apparatus, machine or device through
electrical outlets except in the manner for which such

 

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outlets are designed and without the use of any device intended to increase the
plug capacity of any electrical outlet. If Tenant installs lighting requiring
power in excess of that required for normal office use in the Building or
equipment or computers requiring power in excess of that required for normal
desk top office equipment, or if Tenant’s consumption of electricity is
otherwise in excess of the amount that would reasonably be incurred for a
business operating as a general business office during reasonable and usual
business hours, all as reasonably determined by Landlord based on the actual
additional cost incurred by Landlord for electricity, Landlord shall have the
right to impose a reasonable charge, as determined by Landlord, for such excess
use, and Tenant shall pay to Landlord, upon billing by Landlord, the cost of
such excess, as reasonably determined by Landlord. Landlord shall have the right
at any time to install an electric current monitoring device in the Premises or
otherwise to measure the amount of electric current consumed on the Premises,
and the cost of such device or other corrective measures and the installation
and maintenance thereof shall be paid for by Tenant. All costs payable by Tenant
under this Section 7.3 shall be deemed to be, and shall be paid as, additional
rent.

 

7.4. Landlord shall provide and maintain, at no expense to Tenant (other than as
an item of Operating Expenses), telephone riser space in the Building core
adequate to accommodate the telecommunications needs of a general office tenant,
and lines and conduit in Building risers or pathways that provide a continuous
connection of intrabuilding telecommunications cabling from a telephone closet
located on the floor of the Premises (the “Telephone Closet”) to the main
telephone closet located in the ground or basement level floors of the Building.
Subject to such reasonable rules and regulations as may be adopted by Landlord
for uniform application to all tenants in the Building, Landlord shall permit
Tenant reasonable access to the Telephone Closet and the Building’s
intrabuilding telecommunications cabling for the purposes permitted hereinabove
and agrees that Tenant may install, remove and maintain in the Premises such
voice and data telecommunications equipment as is generally utilized by office
tenants and, in connection therewith, to connect the same to the distribution
frames located in the Telephone Closet; provided, however, Tenant shall not
alter, modify, add to or disturb any telecommunications wiring or cabling in any
portion of the Building outside the Premises without Landlord’s prior written
consent and, except as herein provided, no right is herein granted (express or
implied) to Tenant to place any telecommunications device (receive only or
transmitting) anywhere in the Building outside of the Premises. Landlord may
limit and control access to the Telephone Closet to Landlord approved vendors
and telecommunications providers, and may charge telecommunications providers
for the use of, or access to, the Building’s telecommunications lines, conduits
and risers. Tenant shall be solely responsible for, and shall indemnify, defend
and hold Landlord harmless, from any and all damage to the telecommunications
cabling and wiring in the Building due to the act (negligent or otherwise) of
Tenant or any employee, agent or contractor of Tenant. Landlord makes no
representation to Tenant regarding the condition, security, availability or
suitability for Tenant’s purposes of existing intrabuilding network cabling,
risers, pathways or any telecommunications services presently located within the
Building, and Tenant hereby waives any claim against Landlord for any damages if
Tenant’s telecommunications services in any way are interrupted, damaged or
otherwise interfered with, except to the extent caused by the gross negligence
or willful or criminal misconduct of Landlord, its agents or employees, provided
that in no event shall any such interruption, damage or interference entitle
Tenant to any consequential damages (including damages for loss of business) or
relieve Tenant of any of its obligations under this Lease. Tenant shall maintain
and repair all telecommunications cabling and wiring within or exclusively

 

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serving the Premises, and shall remove the same, at its sole cost and expense,
at the expiration or earlier termination of the term of this Lease.

 

7.5. Extraordinary Services. Landlord may impose a reasonable direct charge and
establish reasonable rules and regulations for any of the following: (a) the use
of any HVAC by Tenant at any time other than during Regular Business Hours;
(b) the usage of any services provided to Tenant (including without limitation,
freight elevator service, or use of the loading dock facilities by Tenant) at
any time other than during Regular Business Hours, except that there shall be no
additional charge for passenger elevator service, general access, domestic
water, and charges for after hours use of electricity shall be made only with
respect to overstandard use consistent with the provisions of Section 7.3; and
(c) additional or unusual janitorial services required because of any
non-building standard improvements in the Premises, the carelessness of Tenant,
the nature of Tenant’s business other than normal office use (including the
operation of Tenant’s business other than during Regular Business Hours). The
foregoing direct charges shall be payable by Tenant as additional rent on the
next rent payment date after submission of an invoice therefor by Landlord.
Notwithstanding anything to the contrary contained in this Lease, Landlord shall
have the right, at its option, to distribute electric current for the Building,
and in connection therewith to meter and charge all tenants in the Building,
including Tenant, directly for their use of electricity and HVAC within their
respective premises. In such event, Tenant shall pay such charges as additional
rent on a monthly basis within thirty (30) days after invoice therefor, and all
such charges shall be excluded from Operating Expenses under Section 4.2.
Landlord may cease to furnish electricity upon thirty (30) days’ prior written
notice, provided within such period Landlord connects Tenant with another source
of electric supply.

 

7.6. Subject to the Rules and Regulations of the Building, Landlord hereby
establishes the period from 8:00 A.M. to 6:00 P.M., Monday through Friday,
excluding New Year’s Day, Presidents’ Day, Memorial Day, Independence Day, Labor
Day, Thanksgiving, Christmas and such other holidays as are generally recognized
in San Francisco, California, as the business hours of the Building (“Regular
Business Hours”).

 

8. MAINTENANCE AND REPAIRS

 

8.1. Landlord shall maintain and repair the Common Areas of the Building, the
roof and exterior elements of the Building, and the elevator, mechanical
(heating, ventilating and air conditioning) and electrical systems of the
Building and keep such areas, elements and systems in reasonably good order and
condition. Any damage in or to any such areas, elements or systems caused by
Tenant or any agent, officer, employee, contractor, licensee or invitee of
Tenant shall be repaired by Landlord at Tenant’s expense and Tenant shall pay to
Landlord, upon billing by Landlord, as additional rent, the cost of such repairs
incurred by Landlord.

 

8.2. Tenant shall, at all times during the term of this Lease and at Tenant’s
sole cost and expense, maintain and repair the Premises and every part thereof
and all equipment, fixtures and improvements therein and keep all of the
foregoing clean and in good order and operating condition, ordinary wear and
tear and damage thereto by fire or other casualty excepted. Tenant hereby waives
all rights under California Civil Code Section 1941 and all rights to make
repairs at the expense of Landlord or in lieu thereof to vacate the Premises as
provided by California Civil Code Section 1942 or any other law, statute or
ordinance now or hereafter in effect.

 

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Subject to Section 9.3 hereof, Tenant shall, at the end of the term of this
Lease, surrender to Landlord the Premises and all alterations, additions,
fixtures and improvements therein or thereto in the same condition as when
received, ordinary wear and tear and damage thereto by fire or other casualty
excepted.

 

9. ALTERATIONS

 

9.1. Tenant shall not make any alterations, additions or improvements in or to
the Premises or any part thereof, or attach any fixtures or equipment thereto,
without Landlord’s prior written consent. All alterations, additions and
improvements, if any, made by Tenant in or to the Premises shall be made at
Tenant’s sole cost and expense, shall be consistent with the general office use
of the Premises, shall not adversely affect the utility of the Premises for
future tenants, shall not affect in any way the structural, exterior or roof
elements of the Building or the elevator, mechanical, electrical, plumbing or
life safety systems of the Building or cause or result in Landlord being
required by law to make additional alterations, additions or improvements to the
Building or any portion thereof, and shall otherwise be done in compliance with
all of the following:

 

(a) No such work shall proceed without Landlord’s prior written approval of
(i) Tenant’s contractor(s); (ii) certificates of insurance from a company or
companies approved by Landlord, furnished to Landlord by Tenant’s contractor for
combined single limit bodily injury and property damage insurance covering
commercial general liability and automobile liability, in an amount not less
than two million dollars ($2,000,000) per occurrence, endorsed to provide
coverage for completed operations, product liability and broad form property
damage liability, and endorsed to show Landlord as an additional insured, and
for workers’ compensation as required by law, endorsed to show a waiver of
subrogation by the insurer to any claims Tenant’s contractor may have against
Landlord; (iii) certificates of insurance from a company or companies approved
by Landlord, furnished to Landlord by Tenant for “Builder’s All-Risk” insurance
in an amount approved by Landlord covering the construction of the improvements;
(iv) adequate financial assurances in form and substance reasonably requested by
Landlord securing the lien free completion of the intended work, and
(v) detailed plans and specifications for such work, prepared by a licensed
architect and engineer approved in writing by Landlord.

 

(b) All such work shall be done strictly in accordance with the plans approved
by Landlord and otherwise in conformity with a valid building permit and/or all
other permits or licenses when and where required, copies of which shall be
furnished to Landlord before the work is commenced, and with any work not
acceptable to any governmental authority or agency having or exercising
jurisdiction over such work, or not reasonably satisfactory to Landlord, being
promptly replaced and corrected at Tenant’s expense. Landlord’s approval or
consent to any such work shall not impose any liability upon the Landlord.

 

(c) Tenant shall pay Landlord prior to commencement of the work an
administration fee equal to five percent (5%) of the cost of the work to
compensate Landlord for the administrative costs incurred and the Building
services provided by Landlord in the supervision and coordination of the work.

 

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(d) Tenant shall immediately reimburse Landlord for any expense incurred by
Landlord by reason of any faulty work done by Tenant or Tenant’s contractors, or
by reason of delays caused by such work, or by reason of inadequate cleanup.

 

(e) Tenant shall be responsible for any alterations, additions or improvements
required by law to be made by Landlord to or in the Premises or the Building as
a result of Tenant’s proposed alterations, additions or improvements.

 

(f) Tenant or its contractors will in no event be allowed to make plumbing,
mechanical or electrical improvements to the Premises which adversely affect the
Building or any structural modification to the Building without first obtaining
Landlord’s consent, which Landlord can in its sole and absolute discretion.

 

(g) All work by Tenant shall be scheduled through Landlord and shall be
diligently and continuously pursued from the date of its commencement through
its completion.

 

(h) Upon completion of any alterations, additions or improvements in or to the
Premises by Tenant, Tenant shall, at its sole cost and expense, promptly provide
Landlord with updated “record” drawings of all such alterations and
improvements.

 

9.2. Tenant shall give written notice to Landlord of the date on which
construction of any work will be commenced at least ten (10) days prior to such
date. Tenant shall keep the Premises and the Building free from mechanics’,
materialmen’s and all other liens arising out of any work performed, labor
supplied, materials furnished or other obligations incurred by Tenant. Landlord
shall have the right to post and keep posted on the Premises any notices that
may be provided by law or which Landlord may deem to be proper for the
protection of Landlord, the Premises and the Building from such liens. Tenant
shall promptly and fully pay and discharge all claims on which any such lien
could be based, and in case of any such lien attaching or notice of any lien,
Tenant covenants and agrees to cause it to be immediately released and removed
of record. Notwithstanding anything to the contrary set forth in this Lease, in
the event that such lien is not released and removed by bond or otherwise within
five (5) days after written notice of such lien is delivered by Landlord to
Tenant, Landlord may, without waiving its rights and remedies based upon such
breach by Tenant and without releasing Tenant from any of its obligations,
immediately take all action necessary to release and remove such lien, without
any duty to investigate the validity thereof, and all sums, costs and expenses,
including reasonable attorneys’ fees and costs, incurred by Landlord in
connection with such lien shall be deemed additional rent under this Lease and
shall immediately be due and payable by Tenant.

 

9.3. All alterations, additions, fixtures and improvements, including carpeting,
whether temporary or permanent in character, made in or to the Premises by
Landlord or Tenant (other than and excluding trade fixtures paid for by Tenant,
shall become part of the Building and Landlord’s property immediately upon
installation or completion of construction. Upon termination of this Lease,
Landlord shall have the right, at Landlord’s option, by giving written notice to
Tenant at any time before or within thirty (30) days after such termination, to
retain all such alterations, additions, fixtures (including trade fixtures) and
improvements in the Premises, without compensation to Tenant, or to require
Tenant to remove all such alterations, additions, fixtures and improvements from
the Premises, repair all damage caused by any such removal,

 

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and restore the Premises (including restoration of all openings or holes, stairs
and vertical penetrations in the Premises) to the condition in which the
Premises existed before such alterations, additions, fixtures and improvements
were made. If Tenant fails to remove such property and improvements following
demand by Landlord, Tenant shall pay to Landlord, upon billing by Landlord, the
cost of such removal, repair and restoration (including a reasonable charge for
Landlord’s overhead and profit). All movable furniture, equipment, trade
fixtures paid for by Tenant, computers, office machines and other personal
property shall remain the property of Tenant. Upon termination of this Lease,
Tenant shall, at Tenant’s expense, remove all such movable furniture, equipment,
trade fixtures, computers, office machines, telephones and other personal
property (including without limitation all cables, wiring and conduits
connecting same) from the Building and repair all damage caused by any such
removal. Termination of this Lease shall not affect the obligations of Tenant
pursuant to this Section 9.3 to be performed after such termination.

 

10. INDEMNIFICATION AND RELEASE OF LANDLORD

 

10.1. Landlord shall not be liable to Tenant, and Tenant hereby waives any and
all claims against Landlord, for any damage to or loss or theft of any property
or for any bodily or personal injury, illness or death of any person in, on or
about the Premises or the Building, or any loss of business or goodwill arising
at any time and from any cause whatsoever, except to the extent caused by the
gross negligence or willful misconduct of Landlord. In addition to the foregoing
limitations of liability set forth above, Tenant acknowledges and agrees that in
the event it shall have any claim against Landlord arising out of or related to
this Lease, Tenant’s sole and exclusive recourse shall be against the interest
of Landlord in the Building, and Tenant hereby releases and waives any and all
rights to assert any claim against, or obtain any damages from, the partners,
directors and officers of Landlord or any persons or entities constituting or
representing Landlord.

 

10.2. Tenant shall indemnify and defend Landlord and save it harmless from and
against any and all claims, suits, actions, proceedings, liability, damages,
costs or expenses, including attorneys’ and experts’ fees and court costs,
arising (i) from any act, omission, or negligence of Tenant or its officers,
contractors, licensees, agents, employees, guests, invitees, or visitors in or
about the Premises, (ii) from Tenant’s use or occupancy of the Premises or the
business conducted by Tenant therein, (iii) from any breach or default under
this Lease by Tenant, (iv) from or relating to the enforcement by Landlord of
the provisions of this Lease as against Tenant, or (v) from any accident,
injury, or damage, howsoever and by whomsoever caused, to any person claiming by
through or under Tenant, or to property, occurring in or about the Building, the
Premises or the Property caused by Tenant or its officers, contractors,
licensees, agents, employees, guests, invitees or visitors. This provision shall
not be construed to make Tenant responsible for loss, damage, liability or
expense resulting from the injuries to third parties caused solely and directly
by the negligence, acts or omissions of Landlord or its officers, contractors,
licenses, agents, employees or invitees. The provisions of this Section shall
survive the expiration or termination of this Lease.

 

10.3. The indemnification provisions of this Article 10 are in addition to and
shall not detract from, or impair, the indemnification obligations of Tenant
under any other provisions of this Lease.

 

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11. INSURANCE

 

11.1. Insurance Maintained by Tenant. Tenant shall maintain in full force and
effect during the entire term of this Lease, at its own cost and expense, the
following policies of insurance:

 

(a) Commercial General Liability Insurance and Umbrella Liability Insurance. In
an amount equal to that currently maintained by Tenant, but not less than
$2,000,000 each occurrence. If such CGL insurance contains a general aggregate
limit, it shall apply separately to this location. Said policy shall provide
coverage for bodily injury, property damage and advertising/personal injury
arising from premises, operations, independent contractors, products- completed
operations, and liability assumed under an insured contract both oral and
written. Not more frequently than once each three years, if, in the opinion of
Landlord the amount of Commercial General Liability insurance coverage at that
time is not adequate, Tenant shall increase the insurance coverage as reasonably
required by Landlord not more than the amount customarily required by landlords
for comparable buildings.

 

(b) Workers’ Compensation Insurance and Employers’ Liability Insurance. Worker’s
Compensation Insurance as required by law and Employer’s Liability Insurance in
an amount equal to that currently maintained by Tenant, but not less than the
following:

 

(i) Bodily Injury by Accident: $1,000,000 each accident;

 

(ii) Bodily Injury by Disease: $1,000,000 policy limit; and

 

(iii) Bodily Injury by Disease: $1,000,000 each employee.

 

(c) Commercial Property Insurance. Covering the Tenant Improvements and other
Tenant personal property, including fixtures, inventory, equipment, and
betterments and all other of the Premises and (if any, such as installed by or
for Tenant) all mechanical, plumbing, heating, ventilating, air conditioning,
electrical. The policy shall, at a minimum, cover the perils insured under the
ISO Special Causes of Loss Form (CP 10 30), but must include coverage for the
following: vandalism, malicious mischief, sprinkler leakage. Such insurance
shall be in an amount equal to 100% of the full replacement cost. Any
coinsurance requirement in the policy shall be eliminated through the attachment
of an agreed amount endorsement, or as is otherwise appropriate under the
particular policy form. The proceeds of such insurance, so long as this Lease
remains in effect, shall be used to repair and/or replace the Premises, and the
Tenant Improvements, fixtures, glass, equipment, mechanical, plumbing, heating,
ventilating, air conditioning, electrical, telecommunication and other
equipment, systems and facilities so insured.

 

Because this property is located in a zone known for the hazard of Earthquakes,
Tenant shall also purchase Earthquake coverage with a limit equal to the full
replacement cost of the property described in this Section 11.1 (c) above, but
Tenant shall not be required to insure any part of the Building not included in
the Premises.

 

(d) Business Interruption or Rental Loss Insurance. Sufficient to cover, for a
period of not less than one year, all rental, expense and other payment
obligations of Tenant

 

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under this Lease, including, without limitation, Base Rent and adjustments
thereto, and Taxes, Operating Expenses and all other costs, fees, charges and
payments which would be borne by or due from Tenant under this Lease if the
Premises and Tenant’s business were fully open and operating.

 

(e) Any other forms of insurance Landlord may require from time to time, in form
and amounts and for insurance risks against which a prudent Tenant of comparable
size in a comparable business would protect itself.

 

11.2. Form of Insurance.

 

(a) All insurance required to be carried by Tenant hereunder:

 

(b) shall be issued by insurance carriers authorized to conduct business in the
state in which the Premises are located and with an A.M. Best’s guide rating of
no less than A VIII;

 

(c) shall be written as primary insurance and non-contributory over any
insurance purchased by Landlord;

 

(d) shall contain a provision whereby each insurer agrees to give Landlord at
least thirty (30) days’ prior written notice of any cancellation;

 

(e) may provide for a deductible so long as the deductible does not exceed
$10,000 per occurrence;

 

(f) shall be written on an Occurrence basis. Any policies underwritten as Claims
Made will not satisfy the insurance requirements outlined above in 11.1;

 

(g) shall not be modified to reduce the extent of coverage or limits required
herein without the prior written consent of Landlord.

 

(h) as respects the Commercial General Liability, Commercial Automobile
Liability and Umbrella Liability policies, Tenant shall ensure that the
following are added by endorsement under the ISO form (CG 20 11) as additional
insureds to the policies:

 

Landlord and RREEF (“Manager”), their parent companies, subsidiaries, affiliate
companies and partnerships and all of their directors, officers, agents,
representatives and employees.

 

(i) Evidence of Commercial Property Insurance shall be provided under the form
ACORD 24, and certificates of all other insurance and appropriate endorsements
shall be provided under the form ACORD 25, said certificates shall be provided
to Landlord five (5) days prior to occupancy and evidence of renewal shall be
provided to Landlord no less than fifteen (15) business days prior to expiry

 

11.3. Failure to Maintain. If Tenant shall fail to acquire and maintain the
insurance required pursuant to this Article, Landlord may, in addition to any
other rights and remedies

 

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available to Landlord, but shall not be obligated to, acquire such insurance and
pay the premiums therefor, which premiums shall be payable by Tenant to Landlord
immediately upon demand.

 

11.4. Blanket Insurance. Tenant may, at its option, satisfy its insurance
obligations hereunder by policies of so-called blanket insurance carried by
Tenant provided that the same shall, in all respects, comply with the provision
hereof. In such event, Tenant shall not be deemed to have complied with its
obligation hereunder until Tenant shall have obtained and delivered to Landlord
a certificate of insurance with appropriate endorsements, or upon Landlord’s
request, a copy of said policy with endorsements.

 

11.5. Insurance Maintained by Landlord. Landlord shall obtain and keep in force
during the Term Commercial General Liability Insurance, Commercial Property
Insurance, and Boiler & Machinery Insurance covering the Building, Building Area
and any permanent Tenant Improvements provided by Landlord, with coverages and
in amounts deemed prudent by Landlord from time to time. Tenant shall pay to
Landlord as Additional Rent Tenant’s Proportionate Share of the total dollar
increase in cost of the premiums for all such insurance over the Base Expense
Year and the reasonable cost of Landlord’s insurance consultants.
Notwithstanding any contribution by Tenant to the cost of insurance premiums as
provided herein, Tenant acknowledges that Tenant has no right to receive any
proceeds from any insurance policies carried by Landlord.

 

11.6. Waiver of Subrogation. Landlord and Tenant hereby waive any recovery of
damages against each other (including their employees, officers, directors,
agents, or representatives) for loss or damage to the Building, Tenant
Improvements and betterments, fixtures, equipment, and any other personal
property to the extent covered by commercial property insurance or boiler and
machinery insurance required above. If the commercial property insurance and
boiler and machinery insurance purchased by Tenant or Landlord as required above
do not expressly allow the insured to waive rights of subrogation prior to loss,
Tenant and Landlord shall cause the policies to be endorsed with a waiver of
subrogation to the extent described in this Section 11.6. The cost of the
endorsement, if any, shall be borne exclusively by Tenant and Landlord
respectively.

 

12. COMPLIANCE WITH LEGAL REQUIREMENTS

 

12.1. Tenant shall, at Tenant’s sole cost and expense, promptly comply with all
laws, ordinances, rules, regulations, orders and other requirements of any
government or public authority now in force or which may hereafter be in force,
including, without limitation, all relevant laws, ordinances, rules, regulations
and orders dealing with the use, transport, storage and disposal of asbestos,
petroleum products and hazardous substances, materials and waste which are or
may become regulated by any local government authority, the State of California
or the United States of America, the federal Americans With Disabilities Act as
it affects Tenant’s operations and employees in the Premises, with all
requirements of any board of fire underwriters or other similar body now or
hereafter constituted, with the conditions of any certificate of occupancy of
the Building or any recorded instrument encumbering the Building (copies of
which are provided to Tenant), and with all directives issued pursuant to any
law by any governmental agency or officer, insofar as any thereof relate to or
are required by the condition (including any condition preexisting the delivery
of the Premises to Tenant), use or

 

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occupancy of the Premises, or the operation, use or maintenance of any personal
property, fixtures, machinery, equipment or improvements in the Premises,
whether now in effect or enacted in the future and whether or not now
foreseeable, but Tenant shall not be required to make structural changes unless
structural changes are related to or required by Tenant’s acts or use of the
Premises or by improvements made by or for Tenant.

 

13. ASSIGNMENT OR SUBLEASE

 

13.1.

 

(a) Tenant shall not, directly or indirectly, without the prior written consent
of Landlord (which consent shall not be unreasonably withheld), assign this
Lease or any interest herein or sublease the Premises or any part thereof, or
permit the use or occupancy of the Premises by any person or entity other than
Tenant. Tenant shall not, directly or indirectly, without the prior written
consent of Landlord, pledge, mortgage or hypothecate this Lease or any interest
herein. Any sale or transfer (including, without limitation, by consolidation,
merger or reorganization) of a controlling interest in the voting stock of
Tenant, if Tenant is a corporation, or of a controlling partnership interest of
Tenant, if Tenant is a partnership, shall be deemed an assignment for purposes
of this Section 13.1. The term “controlling” as used in the immediately
preceding sentence shall mean the right to exercise, directly or indirectly,
forty-five percent (45%) or more of the voting or equity rights attributable to
the interest of the controlled entity. If Tenant is currently a partnership
(either general or limited), joint venture, cotenancy or joint tenancy, the
conversion of any Tenant entity into any type of entity which possesses the
characteristics of limited liability such as, by way of example only, a
corporation, a limited liability company, or limited liability partnership,
shall be deemed an assignment for purposes of this Section 13.1. This Lease
shall not, nor shall any interest herein, be assignable as to the interest of
Tenant involuntarily or by operation of law without the prior written consent of
Landlord. Any of the foregoing acts without such prior written consent of
Landlord shall be void and shall, at the option of Landlord, constitute a
default that entitles Landlord to terminate this Lease. Without limiting the
generality of the foregoing, in the case of an assignment of this Lease (or
Tenant’s interest herein) by Tenant, voluntarily, involuntarily or by operation
of law, or a subletting of all or substantially all of the Premises, Landlord,
in lieu of consenting or withholding its consent to such transfer shall have the
right to terminate this Lease on the terms hereafter provided.

 

(b) Without limiting or excluding other reasons for withholding Landlord’s
consent, Landlord shall have the right to withhold consent if the proposed
assignee or subtenant or the use of the Premises to be made by the proposed
assignee or subtenant is not consistent with the character and nature of other
tenants and uses in the Building or is prohibited by this Lease, or if the
proposed assignee or subtenant is currently a tenant or other occupant of the
Building, or if it is not demonstrated to the satisfaction of Landlord that the
proposed assignee or subtenant has good business and moral character and
reputation and that the financial condition of the proposed assignee or
subtenant equals or exceeds that required by Landlord of other tenants leasing
comparable space in the Building.

 

(c) Tenant agrees that the instrument by which any assignment or sublease to
which Landlord consents is accomplished shall expressly provide that the
assignee or subtenant

 

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will perform all of the covenants to be performed by Tenant under this Lease (in
the case of a sublease, only insofar as such covenants relate to the portion of
the Premises subject to such sublease) as and when performance is due after the
effective date of the assignment or sublease and that Landlord will have the
right to enforce such covenants directly against such assignee or subtenant. Any
purported assignment or sublease without an instrument containing the foregoing
provisions shall be void.

 

13.2. If Tenant wishes to assign this Lease or sublease all or any part of the
Premises, Tenant shall give written notice to Landlord identifying the intended
assignee or subtenant by name and address and specifying all of the terms of the
intended assignment or sublease. Tenant shall give Landlord such additional
information concerning the intended assignee or subtenant (including complete
financial statements and a business history) or the intended assignment or
sublease (including true copies thereof) as Landlord requests. For a period of
thirty (30) days after such written notice is given by Tenant, Landlord shall
have the right, by giving written notice to Tenant, to (a) consent in writing to
the intended assignment or sublease, subject to the terms of this Article 13,
(b) withhold and decline to consent to the intended assignment or sublease, or
(c) in the case of an assignment of this Lease or a sublease of the entire or
substantially all of the Premises, to terminate this Lease by written notice to
Tenant, which termination shall be effective as of the date on which the
intended assignment or sublease would have been effective if Landlord had not
exercised such termination right. A sublease of seventy- five percent (75%) or
more of the Premises shall be deemed a sublease of substantially all of the
Premises. If Landlord elects to terminate this Lease, then from and after the
date of such termination Landlord and Tenant each shall have no further
obligation to the other under this Lease with respect to the Premises except for
matters occurring or obligations arising hereunder prior to the date of such
termination. If Landlord elects to terminate this Lease, Tenant shall have the
right, by giving written notice to Landlord within five (5) days of Landlord’s
exercise of its right under clause (c) above, to rescind its request to Landlord
to consent to the proposed assignment or subletting, in which event this Lease
shall not terminate and this Lease shall remain in full force and effect. If
Landlord does not exercise any of the rights set forth in clause (a), (b) or
(c) above by giving written notice to Tenant within such period of thirty
(30) days, Landlord shall be deemed to consent in writing to the intended
assignment or sublease pursuant to clause (a) above.

 

13.3. If Landlord consents in writing (or Landlord is deemed to consent in
writing in accordance with Section 13.2 hereof), Tenant may complete the
intended assignment or sublease subject to the following covenants: (a) the
assignment or sublease shall be on the same terms as set forth in the written
notice given by Tenant to Landlord, (b) no assignment or sublease shall be valid
and no assignee or subtenant shall take possession of the Premises or any part
thereof until an executed duplicate original of such assignment of sublease, in
compliance with Section 13.1 hereof, has been delivered to Landlord, (c) no
assignee or subtenant shall have a right further to assign or sublease, and
(d) all excess rent (as hereinafter defined) derived from such assignment or
sublease shall be paid to Landlord. Such excess rent shall be deemed to be, and
shall be paid by Tenant to Landlord, as additional rent. Tenant shall pay such
excess rent to Landlord immediately as and when such excess rent becomes due and
payable to Tenant. As used in this Section 13.3, “excess rent” shall mean the
amount by which the total money and other economic consideration to be paid by
the assignee or subtenant as a result of an assignment or sublease, whether
denominated rent or otherwise, exceeds, in the aggregate, the total amount of
rent which

 

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Tenant is obligated to pay to Landlord under this Lease (prorated to reflect the
rent allocable to the portion of the Premises subject to such assignment or
sublease), less only the reasonable costs paid by Tenant for additional
improvements installed in the portion of the Premises subject to such assignment
or sublease at Tenant’s sole cost and expense for the specific assignee or
subtenant in question and approved by Landlord in accordance with the provisions
of Article 9 hereof, and reasonable leasing commissions paid by Tenant in
connection with such assignment or sublease, without deduction for carrying cost
due to vacancy or otherwise. Such costs of additional improvements and leasing
commissions shall be amortized without interest over the term of such assignment
or sublease.

 

13.4. No assignment or sublease whatsoever shall release Tenant from Tenant’s
obligations and liabilities under this Lease or alter the primary liability of
Tenant to pay all rent and to perform all obligations to be paid and performed
by Tenant. The acceptance of rent by Landlord from any other person or entity
shall not be deemed to be a waiver by Landlord of any provision of this Lease.
Consent to one assignment or sublease shall not be deemed consent to any
subsequent assignment or sublease. If any assignee, subtenant or successor of
Tenant defaults in the performance of any obligation to be performed by Tenant
under this Lease, Landlord may proceed directly against Tenant without the
necessity of exhausting remedies against such assignee, subtenant or successor.
Landlord may consent to subsequent assignments or subleases or amendments or
modifications to this Lease with assignees, subtenants or successors of Tenant,
without notifying Tenant or any successor of Tenant and without obtaining any
consent thereto from Tenant or any successor of Tenant and such action shall not
release Tenant from liabilities under this Lease.

 

13.5. If Tenant requests the consent or approval of Landlord to any assignment
or sublease under this Article 13, Tenant shall pay to Landlord on demand, as
additional rent, all costs and expenses, including reasonable attorneys’ fees
and disbursement, incurred by Landlord in connection with Landlord’s review and
negotiation of any assignment, sublease and/or consent documentation relating to
the subject transaction, whether or not the consent of Landlord is actually
given or the transaction actually is consummated, not to exceed $1,500.

 

14. RULES AND REGULATIONS

 

14.1. Tenant shall faithfully observe and comply with the rules and regulations
(the “Rules and Regulations”) set forth in Exhibit B attached hereto and, after
notice thereof, all reasonable modifications thereof and additions thereto from
time to time made in writing by Landlord. If there is any conflict, this Lease
shall prevail over the Rules and Regulations and any modifications thereof or
additions thereto. Landlord shall not be liable to Tenant or responsible for the
noncompliance by any other tenant or occupant of the Building with any Rules and
Regulations.

 

15. ENTRY BY LANDLORD

 

15.1. Landlord shall have the right to enter the Premises with reasonable verbal
or written notice at any time to (a) inspect the Premises, (b) exhibit the
Premises to prospective purchasers, lenders or tenants, (c) determine whether
Tenant is performing all of Tenant’s obligations, (d) supply any services to be
provided by Landlord, (e) post notices of

 

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nonresponsibility, and (f) make any repairs to the Premises. or make any repairs
to any adjoining space or utility services, or make any repairs, alterations or
improvements to any other portion of the Building. provided all such work shall
be done as promptly as reasonably practicable and so as to cause as little
interference to Tenant as reasonably practicable. Tenant waives all claims for
damages for any injury or inconvenience to or interference with Tenant’s
business, any loss of occupancy or quiet enjoyment of the Premises or any other
loss occasioned by such entry. All locks for all doors in, on or about the
Premises (excluding Tenant’s vaults, safes and similar special security areas
designated in writing by Tenant) shall be keyed to the master system for the
Building. Landlord shall at all times have a key to unlock all such doors and
Landlord shall have the right to use any and all means which Landlord may deem
proper to open such doors in an emergency to obtain entry to the Premises. Any
entry to the Premises obtained by Landlord by any of such means shall not under
any circumstances be construed or deemed to be a forcible or unlawful entry into
or a detainer of the Premises or an eviction, actual or constructive, of Tenant
from the Premises or any portion thereof.

 

16. EVENTS OF DEFAULT AND REMEDIES

 

16.1. The occurrence of any one or more of the following events (“Event of
Default”) shall constitute a breach of this Lease by Tenant:

 

(a) Tenant fails to pay any Base Rent or additional monthly rent under
Section 3.1 hereof as and when such rent becomes due and payable and such
failure continues for more than three (3) days after Landlord gives written
notice thereof to Tenant; provided, however, that after the first such failure
in a calendar year, only the passage of time, but no further notice, shall be
required to establish an Event of Default in the same calendar year; or

 

(b) Tenant fails to pay any additional rent or other amount of money or charge
payable by Tenant hereunder as and when such additional rent or amount or charge
becomes due and payable and such failure continues for more than ten (10) days
after Landlord gives written notice to Tenant; provided, however, that after the
first such failure in a calendar year, only the passage of time, but no further
notice, shall be required to establish an Event of Default in the same calendar
year; or

 

(c) Any assignment or subletting in violation of the terms of this Lease, or the
taking of any action leading to, or the actual dissolution or liquidation of
Tenant, if Tenant is other than an individual; or

 

(d) Except as otherwise provided in this Section 16.1, Tenant fails to perform
or breaches any other agreement or covenant of this Lease to be performed or
observed by Tenant as and when performance or observance is due and such failure
or breach continues for more than twenty (20) days after Landlord gives written
notice thereof to Tenant; provided, however, that if, by the nature of such
agreement or covenant, such failure or breach cannot reasonably be cured within
such period of twenty (20) days, an Event of Default shall not exist as long as
Tenant commences with due diligence and dispatch the curing of such failure or
breach within such period of twenty (20) days and having so commenced,
thereafter prosecutes with diligence and dispatch and completes the curing of
such failure or breach; or

 

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(e) Tenant (i) is generally not paying its debts as they become due, (ii) files,
or consents by answer or otherwise to the filing against it of, a petition for
relief or reorganization or arrangement or any other petition in bankruptcy or
for liquidation or to take advantage of any bankruptcy, insolvency or other
debtors, relief law of any jurisdiction, (iii) makes an assignment for the
benefit of its creditors, (iv) consents to the appointment of a custodian,
receiver, trustee or other officer with similar powers of Tenant or of any
substantial part of Tenant’s property, or (v) takes action for the purpose of
any of the foregoing; or

 

(f) Without consent by Tenant, a court or government authority enters an order,
and such order is not vacated within thirty (30) days, (i) appointing a
custodian, receiver, trustee or other officer with similar powers with respect
to Tenant or with respect to any substantial part of Tenant’s property, or
(ii) constituting an order for relief or approving a petition, for relief or
reorganization or arrangement, or any other petition in bankruptcy, or for
liquidation, or to take advantage of any bankruptcy, insolvency or other
debtors, relief law of any jurisdiction or (iii) ordering the dissolution,
winding up or liquidation of Tenant; or

 

(g) This Lease or any estate of Tenant hereunder is levied upon under any
attachment or execution and such attachment or execution is not vacated within
thirty (30) days; or

 

(h) Tenant abandons the Premises.

 

The notice periods provided herein run concurrently with, and not in addition
to, any statutory notice periods required by law.

 

16.2. If an Event of Default occurs, Landlord shall have the right at any time
to give a written termination notice to Tenant and, on the date specified in
such notice, Tenant’s right to possession shall terminate and this Lease shall
terminate. Upon such termination, Landlord shall have the right to recover from
Tenant:

 

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

 

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

 

(c) The worth at the time of award of the amount by which all unpaid rent for
the balance of the term of this Lease after the time of award exceeds the amount
of such rental loss that Tenant proves could be reasonably avoided; and

 

(d) All other amounts necessary to compensate Landlord for all the detriment
proximately caused by Tenant’s failure to perform all of Tenant’s obligations
under this Lease or which in the ordinary course of things would be likely to
result therefrom. The “worth at the time of award” of the amounts referred to in
clauses (a) and (b) above shall be computed by allowing interest at the maximum
annual interest rate allowed by law for business loans (not primarily for
personal, family or household purposes) not exempt from the usury law at the
time of termination or, if there is no such maximum annual interest rate, at the
rate of eighteen percent

 

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(18%) per annum. The “worth at the time of award” of the amount referred to in
clause (c) above shall be computed by discounting such amount at the discount
rate of the Federal Reserve Bank of San Francisco at the time of award plus one
percent (1%). For the purpose of determining unpaid rent under clauses (a),
(b) and (c) above, the rent reserved in this Lease shall be deemed to be the
total rent payable by Tenant under Articles 3, 4 and 5 hereof.

 

16.3. Even though Tenant has breached this Lease, this Lease shall continue in
effect for so long as Landlord does not terminate Tenant’s right to possession,
and Landlord shall have the right to enforce all its rights and remedies under
this Lease, as set forth in California Civil Code Section 1951.4, including the
right to recover all rent as it becomes due under this Lease. Acts of
maintenance or preservation or efforts to relet the Premises or the appointment
of a receiver upon initiative of Landlord to protect Landlord’s interest under
this Lease shall not constitute a termination of Tenant’s right to possession
unless written notice of termination is given by Landlord to Tenant.

 

16.4. The remedies provided for in this Lease are in addition to all other
remedies available to Landlord at law or in equity by statute or otherwise.

 

16.5. All agreements and covenants to be performed or observed by Tenant under
this Lease shall be at Tenant’s sole cost and expense and without any abatement
of rent. If Tenant fails to pay any sum of money to be paid by Tenant or to
perform any other act to be performed by Tenant under this Lease, Landlord shall
have the right, but shall not be obligated, and without waiving or releasing
Tenant from any obligations of Tenant, to make any such payment or to perform
any such other, act on behalf of Tenant in accordance with this Lease. All sums
so paid by Landlord and all necessary incidental costs shall be deemed
additional rent hereunder and shall be payable by Tenant to Landlord on demand,
together with interest on all such sums from the date of expenditure by Landlord
to the date of repayment by Tenant at the maximum annual interest rate allowed
by law for business loans (not primarily for, personal, family or household
purposes) not exempt from the usury law at the date of expenditure or, if there
is no such maximum annual interest rate, at the rate of eighteen percent
(18%) per annum. Landlord shall have, in addition to all other rights and
remedies of Landlord, the same rights and remedies in the event of the
nonpayment of such sums plus interest by Tenant as in the case of default by
Tenant in the payment of rent.

 

16.6. If Tenant abandons or surrenders the Premises, or is dispossessed by
process of law or otherwise, any movable furniture, equipment, trade fixtures or
personal property belonging to Tenant and left in the Premises shall be deemed
to be abandoned, at the option of Landlord, and Landlord shall have the right to
sell or otherwise dispose of such personal property in any commercially
reasonable manner.

 

17. DAMAGE OR DESTRUCTION

 

17.1. If the Building or the Premises, or any part thereof, is damaged by fire
or other casualty before the Commencement Date or during the term of this Lease,
and this Lease is not terminated pursuant to Sections 17.2 and 17.3 hereof,
Landlord shall repair such damage and restore the Building and the Premises to
substantially the same condition in which the Building and the Premises existed
before the occurrence of such fire or other casualty, as permitted by and

 

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subject to then applicable law, ordinance and regulation, and this Lease shall,
subject to this Section 17.1, remain in full force and effect. In performing
such repair and reconstruction Landlord shall only be obligated to reconstruct
the shell, core and common areas of that portion of the Building damaged or
destroyed and the tenant improvements that are deemed Landlord’s property under
Section 9.3 hereof. If such fire or other casualty damages the Premises or
Common Areas of the Building necessary for Tenant’s use and occupancy of the
Premises, and if such damage is not the result of the negligence or willful
misconduct of Tenant or Tenant’s agents, officers, employees, contractors,
licensees or invitees, then, during the period the Premises are rendered
unusable by such damage, Tenant shall be entitled to a reduction in Base Rent in
the proportion that the area of the Premises rendered unusable by such damage
bears to the total area of the Premises. Landlord shall not be obligated to
restore or repair any damage to, or to make any replacement of, any improvements
constructed by Tenant, at Tenant’s sole cost and expense, including trade
fixtures, or any movable furniture, equipment or personal property in the
Premises. Tenant shall, at Tenant’s sole cost and expense, repair and replace
all such improvements, movable furniture, equipment, trade fixtures and personal
property. Such repair and replacement by Tenant shall be done in accordance with
Article 9 hereof. Tenant hereby waives California Civil Code Sections 1932(2)
and 1933(4).

 

17.2. If the Building or the Premises receives Major Damage (as that term is
hereinafter defined), Landlord shall have the right to terminate this Lease on
thirty (30) days’ prior written notice to Tenant given within ninety (90) days
after the date of the occurrence of said damage or casualty. As used in this
Section 17.2, the term “Major Damage” is defined as:

 

(a) damage to or destruction of the Building or the Premises to such an extent
that either (i) the estimated cost of repair or restoration is greater than
twenty-five percent (25%) of the replacement cost of the Building (excluding
footings, foundations and installations below the basement floor), which damage
or destruction is the result of a risk that is actually covered by the insurance
maintained by Landlord with respect to the Building to the extent of such damage
or destruction (excepting the deductible amount of any policy) or (ii) Landlord
would be required to abate Base Rent under Section 17.1 with respect to the
entire Premises for a period in excess of one hundred eighty (180) days in order
to effect repairs to and restoration of the Premises; or

 

(b) damage to or destruction of the Building or the Premises to such an extent
that the estimated cost of repair or restoration exceeds available insurance
proceeds by more than five percent (5%) of the replacement cost of the Building
(excluding footings, foundations and installations below the basement floor),
which damage or destruction (i) results from a risk that is covered by
Landlord’s insurance, but not to the extent of such damage or destruction
(excepting the deductible amount of any policy) or (ii) does not result from a
risk that is actually covered by the insurance maintained by Landlord with
respect to the Building.

 

To the extent insurance proceeds must be paid by Landlord to a mortgagee or deed
of trust beneficiary encumbering the Premises or the Building to reduce any
indebtedness of Landlord secured thereby, Landlord shall not be deemed to have
insurance coverage to the extent of the damage and destruction unless such
mortgagee or beneficiary permits Landlord to use such proceeds for the
rebuilding, restoration and repair of the Premises or the Building.

 

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17.3. Notwithstanding anything to the contrary in Section 17.2 hereof, if the
fire or other casualty occurs during the last twelve (12) months of the term of
this Lease and the repair and restoration work to be performed by Landlord in
accordance with Section 17.1 hereof cannot, as reasonably estimated by Landlord,
be completed within two (2) months after the occurrence of such fire or other
casualty, Landlord, and if the fire or other casualty is not the result of the
negligence or willful misconduct of Tenant or Tenant’s agents, officers,
employees, contractors, licensees or invitees, Tenant, shall have the right, by
giving written notice to the other party within thirty (30) days of the
occurrence of such fire or other casualty, to terminate this Lease as of the
date of said notice. A total destruction of the Building shall automatically
terminate this Lease effective as of the date of such total destruction.

 

18. EMINENT DOMAIN

 

18.1. If all or any part of the Premises shall be either taken or condemned for
any public or quasi-public use or purpose, or transferred by agreement in
connection with any public or quasi-public use or purpose with or without any
condemnation action or proceeding being instituted (either such event herein
called a “Taking”), and if such Taking is permanent, the term of this Lease
shall automatically terminate with respect to the part of the Premises so taken
as of the date when the possession of such part is required. If all or any
portion of the Premises is subject to a temporary Taking, this Lease shall
remain in full force and effect and Tenant shall continue to perform all terms,
conditions and covenants of this Lease. If a portion of the Premises or the
Building is taken so as to require, in Landlord’s reasonable judgment, a
substantial alteration or reconstruction of the remaining portions, Landlord, at
its sole election, may terminate this Lease as of the date when possession of
the part so taken is required. If a portion of the Premises is permanently taken
and the remaining portion of the Premises is not reasonably suited for Tenant’s
purposes (without material impairment to its ordinary business activities)
Tenant may terminate this Lease as of the same date. Without obligation to
Tenant, Landlord may agree to transfer to any condemnor all or any portion of
the Building sought by such condemnor, free from this Lease and the rights of
Tenant hereunder, without first requiring that any action or proceeding be
instituted or, if instituted, pursued to a judgment.

 

18.2. Landlord shall be entitled to the entire award made to it for any Taking,
provided, however, that: (a) Landlord shall have no interest in any award made
to Tenant specifically for its relocation expenses, the Taking of personal
property or fixtures belonging to Tenant, or the interruption of or a damage to
Tenant’s business, if any such award is made separately to Tenant and not as a
part of an award or damages recoverable by Landlord, and (b) Tenant shall be
entitled to receive the entire award made in connection with any temporary
Taking allocable to the period prior to the expiration of the term.

 

18.3. Landlord and Tenant hereby waive the provisions of California Code of
Civil Procedure Sections 1265.110 through 1265.160 to the extent that such
provisions are inconsistent with this Lease.

 

19. SUBORDINATION, MERGER AND SALES

 

19.1. This Lease shall be subject and subordinate at all times to the lien of
all mortgages and deeds of trust securing any amount or amounts whatsoever which
may now exist

 

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or hereafter be placed on or against the Building or on or against Landlord’s
interest or estate therein, all without the necessity of having further
instruments executed by Tenant to effect such subordination. Notwithstanding the
foregoing, in the event of a foreclosure of any such mortgage or deed of trust
or of any other action or proceeding for the enforcement thereof, or of any sale
thereunder, this Lease shall not be terminated or extinguished, nor shall the
rights and possession of Tenant hereunder be disturbed, if no Event of Default
then exists under this Lease, and Tenant shall attorn to the person who acquires
Landlord’s interest hereunder through any such mortgage or deed of trust. Tenant
agrees to execute, acknowledge and deliver upon demand such further instruments
evidencing such subordination of this Lease to the lien of all such mortgages
and deeds of trust as may reasonably be required by Landlord. If Landlord,
Landlord’s mortgagee or any other successor to Landlord elects in writing, this
Lease shall be deemed superior to the lien of the mortgage or deed of trust
specified regardless of the date of recording, and Tenant shall execute an
agreement confirming this election on request. If Landlord’s mortgagee or its
successor or any successor to Landlord succeeds to Landlord’s interest under
this Lease, whether voluntarily or involuntarily, Tenant shall attorn to such
person and recognize such person as Landlord under this Lease.

 

19.2. The voluntary or other surrender of this Lease by Tenant, or a mutual
cancellation thereof, shall not work a merger and shall, at the option of
Landlord, terminate all or any existing subleases or subtenancies or operate as
an assignment to Landlord of any or all such subleases or subtenancies.

 

19.3. If the original Landlord hereunder, or any successor owner of the
Building, sells or conveys the Building, all liabilities and obligations on the
part of the original Landlord, or such successor owner, under this Lease
accruing after such sale or conveyance shall terminate and the original
Landlord, or such successor owner, shall automatically be released therefrom,
and thereupon all such liabilities and obligations shall be binding upon the new
owner.

 

20. ESTOPPEL CERTIFICATE

 

20.1. At any time and from time to time, Tenant shall, within ten (10) days
after written request by Landlord, execute, acknowledge and deliver to Landlord
a certificate certifying: (a) that this Lease is unmodified and in full force
and effect (or, if there have been modifications, that this Lease is in full
force and effect as modified, and stating the date and nature of each
modification); (b) the Commencement Date and the Expiration Date determined in
accordance with Article 2 hereof and the date, if any, to which all rent and
other sums payable hereunder have been paid; (c) that no notice has been
received by Tenant of any default by Tenant hereunder which has not been cured,
except as to defaults specified in such certificate; (d) that Landlord is not in
default under this Lease, except as to defaults specified in such certificate;
and (e) such other matters as may be reasonably requested by Landlord or any
actual or prospective purchaser or mortgage lender. Any such certificate may be
relied upon by Landlord and any actual or prospective purchaser or mortgage
lender of the Building or any part thereof. Failure by Tenant to timely deliver
such estoppel certificate shall be deemed a conclusively binding certification
by Tenant that the statements in clauses (a) through (d) above are true and
correct.

 

20.2. At any time and from time to time, Tenant shall, within ten (10) days
after written request by Landlord, deliver to Landlord copies, as reasonably
necessary for Landlord’s

 

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purposes, of all current financial statements (including, without limitation, a
balance sheet, an income statement, and an accumulated retained earnings
statement), annual reports, and other financial and operating information and
data of Tenant prepared by Tenant in the course of Tenant’s business. Unless
available to the public, Landlord shall disclose such financial statements,
annual reports and other information or data only to actual or prospective
purchasers or mortgage lenders of the Building or any part thereof, and
otherwise keep them confidential unless other disclosure is required by law.

 

21. HOLDING OVER

 

21.1. If, without objection by Landlord, Tenant holds possession of the Premises
after expiration of the term of this Lease, Tenant shall become a tenant from
month to month upon the terms herein specified but at a Base Rent equal to one
hundred and fifty percent (150%) of the Base Rent in effect at the expiration of
the term of this Lease pursuant to Article 3 hereof, payable in advance on or
before the first day of each month. Such month to month tenancy may be
terminated by either Landlord or Tenant by giving thirty (30) days’ written
notice of termination to the other at any time. If Tenant fails to surrender the
Premises upon the expiration or termination of this Lease except as hereinabove
provided, Tenant hereby indemnifies and agrees to hold Landlord harmless from
all costs, loss, expense or liability, including without limitation, costs, real
estate brokers claims and attorneys’ fees, arising out of or in connection with
any delay by Tenant in surrendering and vacating the Premises, including,
without limitation, any claims made by any succeeding tenant based on any delay
and any liabilities arising out of or in connection with these claims. Nothing
in this Section 21.1 shall be deemed to permit Tenant to retain possession of
the Premises after the expiration or sooner termination of the Lease term.

 

22. SECURITY DEPOSIT

 

22.1. Upon signing this Lease, Tenant shall pay to Landlord the amount of the
Deposit specified in the Basic Lease Information. Each time Base Rent is
increased in accordance with this Lease, Tenant shall deposit additional cash
with Landlord sufficient to increase the Deposit to an amount which bears the
same proportion to the increased Base Rent as the initial Deposit bore to the
initial Base Rent. The Deposit shall be held by Landlord as security for the
performance by Tenant of all of the covenants of this Lease to be performed by
Tenant, including, without limitation, defaults by Tenant in the payment of
rent, the repair of damage to the Premises caused by Tenant, and the cleaning of
the Premises upon termination of the tenancy created hereby, and Tenant shall
not be entitled to interest thereon. The Deposit is not an advance rent deposit,
an advance payment of any other kind, or a measure of Landlord’s damages in any
case of Tenant’s default. If Tenant fails to perform any of the covenants of
this Lease to be performed by Tenant, then Landlord shall have the right, but no
obligation, to apply the Deposit, or so much thereof as may be necessary, to
cure any such failure by Tenant. If Landlord applies the Deposit or any part
thereof to cure any such failure by Tenant, then Tenant shall immediately pay to
Landlord the sum necessary to restore the Deposit to the full amount then
required by this Section 22.1. Any remaining portion of the Deposit shall be
returned to Tenant upon termination of this Lease. Landlord’s obligations with
respect to the Deposit are those of a debtor and not a trustee. Landlord shall
not be required to maintain the Deposit separate and apart from Landlord’s
general or other funds and Landlord may commingle the

 

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Deposit with any of Landlord’s general or other funds. Upon termination of the
original Landlord’s or any successor owner’s interest in the Premises or the
Building, the original Landlord or such successor owner shall be released from
further liability with respect to the Deposit upon the original Landlord’s or
such successor owner’s complying with California Civil Code Section 1950.7.

 

23. WAIVER

 

23.1. The waiver by Landlord or Tenant of any breach of any covenant in this
Lease shall not be deemed to be a waiver of any subsequent breach of the same or
any other covenant in this Lease, nor shall any custom or practice which may
grow up between Landlord and Tenant in the administration of this Lease be
construed to waive or to lessen the right of Landlord or Tenant to insist upon
the performance by Landlord or Tenant in strict accordance with this Lease. The
subsequent acceptance of rent hereunder by Landlord or the payment of rent by
Tenant shall not waive any preceding breach by Tenant of any covenant in this
Lease, nor cure any Event of Default, nor waive any forfeiture of this Lease or
unlawful detainer action, other than the failure of Tenant to pay the particular
rent so accepted, regardless of Landlord’s or Tenant’s knowledge of such
preceding breach at the time of acceptance or payment of such rent.

 

24. NOTICES

 

24.1. All requests, approvals, consents, notices and other communications given
by Landlord or Tenant under this Lease shall be properly given only if made in
writing and either deposited in the United States mail, postage prepaid,
certified with return receipt requested, or delivered by hand (which may be
through a messenger or recognized delivery, courier or air express service) and
addressed to Landlord at the address of Landlord specified in the Basic Lease
Information, or at such other place as Landlord may from time to time designate
in a written notice to Tenant; to Tenant, at the address of Tenant specified in
the Basic Lease Information, and after the Commencement Date, at the Premises,
or at such other place as Tenant may from time to time designate in a written
notice to Landlord. Such requests, approvals, consents, notices and other
communications shall be effective on the date of receipt (evidenced by the
certified mail receipt), if mailed, or on the date of hand delivery, if hand
delivered. If any such request, approval, consent, notice or other communication
is not received or cannot be delivered due to a change in the address of the
receiving party of which notice was not previously given to the sending party or
due to a refusal to accept by the receiving party, such request, approval,
consent, notice or other communication shall be effective on the date delivery
is attempted. Any request, approval, consent, notice or other communication
under this Lease may be given on behalf of a party by the attorney for such
party. Tenant hereby appoints as its agent to receive the service of all default
notices and notice of commencement of unlawful detainer proceedings the person
in charge of or apparently in charge of or occupying the Premises at the time,
and, if there is not such person, then such service may be made by attaching the
same on the maintenance of the Premises and such service shall be effective for
all purposes under this Lease.

 

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25. MISCELLANEOUS

 

25.1. The words “Landlord” and “Tenant”, as used herein shall include the plural
as well as the singular. The words “include,” “includes” and “including” shall
be deemed to be followed by the phrase “without limitation.” If there is more
than one Tenant, the obligations hereunder imposed upon Tenant shall be joint
and several. Time is of the essence of this Lease and each and all of its
provisions. Submission of this instrument for examination or signature by Tenant
does not constitute a reservation of or option for lease, and it is not
effective as a lease or otherwise until execution and delivery by both Landlord
and Tenant. Subject to Article 13 hereof, this Lease shall benefit and bind
Landlord and Tenant and the personal representatives, heirs, successors and
assigns of Landlord and Tenant. Tenant shall not use the name of the Building
for any purpose whatsoever other than as the address of Tenant at the Premises.
If any provision of this Lease is determined to be illegal or unenforceable,
such determination shall not affect any other provision of this Lease and all
such other provisions shall remain in full force and effect. This Lease shall be
governed by and construed in accordance with the laws of the State of
California.

 

25.2. Tenant acknowledges that the late payment by Tenant of any monthly
installment of Base Rent or additional monthly rent will cause Landlord to incur
costs and expenses, the exact amount of which is extremely difficult and
impractical to fix. Such costs and expenses will include administration and
collection costs and processing and accounting expenses. Therefore, if any
monthly installment of Base Rent or additional monthly rent is not received by
Landlord within five (5) days after such installment is due, Tenant shall
immediately pay to Landlord a late charge equal to four percent (4%) of such
delinquent installment. Landlord and Tenant agree that such late charge
represents a reasonable estimate of such costs and expenses and is fair
compensation to Landlord for the loss suffered by Tenant’s failure to make
timely payment. In no event shall such late charge be deemed to grant to Tenant
a grace period or extension of time within which to pay any monthly rent or
prevent Landlord from exercising any right or enforcing any remedy available to
Landlord upon Tenant’s failure to pay each installment of monthly rent due under
this Lease in a timely fashion, including the right to terminate this Lease. All
amounts of money payable to Tenant to Landlord hereunder, if not paid when due,
shall bear interest from the due date until paid at the maximum annual interest
rate allowed by law for business loans (not primarily for personal, family or
household purposes) not exempt from the usury law at such due date or, if there
is no such maximum annual interest rate, at the rate of eighteen percent
(18%) per annum.

 

25.3. If there is any legal action or proceeding between Landlord and Tenant to
enforce this Lease or to protect or establish any right or remedy under this
Lease, the unsuccessful party to such action or proceeding shall pay to the
prevailing party all costs and expenses, including reasonable attorneys’ fees
and disbursements, incurred by such prevailing party in such action or
proceeding and in any appeal in connection therewith. If such prevailing party
recovers a judgment in any such action, proceeding or appeal, such costs,
expenses and attorneys’ fees and disbursements shall be included in and as a
part of such judgment.

 

25.4. Landlord covenants and agrees that Tenant, upon making all of Tenant’s
payments as and when due under this Lease (taking into account any grace periods
granted Tenant), and upon performing, observing and keeping the covenants,
agreements and conditions

 

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of this Lease on its part to be performed, observed and kept, shall peaceably
and quietly hold, occupy and enjoy the Premises during the term of this Lease,
subject to the terms and conditions of this Lease.

 

25.5. Each party warrants and represents to the other that each party has
negotiated this Lease directly with their respective real estate broker(s)
specified in the Basic Lease Information and has not authorized or employed, or
acted by implication to authorize or to employ any other real estate broker or
salesman to act on its behalf in connection with this Lease. Landlord’s Broker
and Tenant’s Broker shall be paid a commission pursuant to a separate written
agreement between Landlord and Landlord’s Broker.

 

25.6. If Tenant is a corporation or limited liability company, Tenant and each
person executing this Lease on behalf of Tenant represents and warrants to
Landlord that (a) Tenant is duly incorporated or formed, as the case may be and
validly existing under the laws of its state of incorporation or formation,
(b) Tenant is qualified to do business in California, (c) Tenant has the full
right, power and authority to enter into this Lease and to perform all of
Tenant’s obligations hereunder, and (d) each person signing this Lease on behalf
of the corporation or company is duly and validly authorized to do so. If Tenant
is a partnership (whether a general or limited partnership), each person
executing this Lease on behalf of Tenant represents and warrants to Landlord
that (i) he/she is a general partner of Tenant, (ii) he/she is duly authorized
to execute and deliver this Lease on behalf of Tenant, (iii) this Lease is
binding on Tenant (and each general partner of Tenant) in accordance with its
terms, and (iv) each general partner of Tenant is personally liable for the
obligations of Tenant under this Lease.

 

25.7. The terms and conditions of this Section 25.7 shall not apply during the
initial one (1) year term of this Lease; provided however, in the event the term
of this Lease is extended beyond such initial one (1) year term, the provisions
of this Section 25.7 shall apply thereafter. Landlord shall have the right, at
any time and from time to time during the term of this Lease, by giving at least
ninety (90) days’ prior written notice to Tenant, to substitute other space in
the Building (the “Substitute Premises”) for the Premises and to relocate Tenant
to the Substitute Premises. Landlord shall designate the effective date for the
substitution of the Substitute Premises for the Premises and the relocation of
Tenant to the Substitute Premises in such notice. The area of the Substitute
Premises shall be approximately comparable to the area of the Premises. Landlord
shall, at Landlord’s expense before such effective date, construct and install
in the Substitute Premises improvements substantially similar in quality and
quantity to the improvements in the Premises. Landlord shall pay the reasonable
costs of moving Tenant’s movable furniture, equipment, trade fixtures and
personal property from the Premises to the Substitute Premises. As of the
effective date for the substitution of the Substitute Premises for the Premises
and the relocation of Tenant to the Substitute Premises, Tenant shall vacate the
Premises and move to the Substitute Premises, and the Substitute Premises shall
be substituted for the Premises under this Lease. Landlord and Tenant each
shall, promptly after such effective date, execute and deliver to the other an
amendment to this Lease which sets forth the substitution of the Substitute
Premises for the Premises, with an appropriate new Exhibit A, and the effective
date of such substitution, but the Substitute Premises shall be substituted for
the Premises on such effective date whether or not such amendment is executed.

 

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25.8. There are no oral agreements between Landlord and Tenant affecting this
Lease, and this Lease supersedes and cancels any and all previous negotiations,
arrangements, brochures, offers, agreements and understandings, oral or written,
if any, between Landlord and Tenant or displayed by Landlord to Tenant with
respect to the subject matter of this Lease, the Premises or the Building. There
are no representations between Landlord and Tenant or between any real estate
broker and Tenant other than those expressly set forth in this Lease and all
reliance with respect to any representations is solely upon representations
expressly set forth in this Lease. This Lease may not be amended or modified in
any respect whatsoever except by an instrument in writing signed by Landlord and
Tenant.

 

25.9. Landlord and Tenant hereby waive their respective right to trial by jury
of any cause of action, claim, counterclaim or cross-complaint in any action,
proceeding and/or hearing brought by either Landlord against Tenant or Tenant
against Landlord on any matter whatsoever arising out of, or in any way
connected with, this Lease, the relationship of Landlord and Tenant, Tenant’s
use of occupancy of the Premises, or any claim of injury or damage, or the
enforcement of any remedy under any law, statute, or regulation, emergency or
otherwise, now or hereafter in effect.

 

IN WITNESS WHEREOF, Landlord and Tenant have executed this Office Lease as of
the date first hereinabove written.

 

LANDLORD:       TENANT: OP&F STEVENSON STREET       LIONBRIDGE U.S., INC., a
CORPORATION,       California corporation a California corporation            

By:

 

RREEF MANAGEMENT COMPANY,

a Delaware corporation, its Manager

               

By:

  LOGO [g24780img_011.jpg]      

By:

  LOGO [g24780img_012.jpg]         Lisa Vogel,       Print Name   David W Dahn  
      Vice President and District Manager      

Its:

  Treasurer

 

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EXHIBIT A

FLOORPLAN OF PREMISES SUITE 1400

APPROXIMATELY 7,721 RENTABLE SQ. FT.

 

LOGO [g24780newimg_013.jpg]

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EXHIBIT “B”

 

RULES AND REGULATIONS

 

49 STEVENSON STREET

OFFICE LEASE

 

Capitalized terms used in these Rules and Regulations and not otherwise defined
shall have the meaning given said terms in the Lease to which this Exhibit is
attached.

 

1. The sidewalks, halls, passages, exits, entrances, elevators and stairways of
the Building shall not be obstructed by Tenant or used by it for any purpose
other than for ingress and egress from the Premises. The halls, passages, exits,
entrances, elevators, escalators and stairways are not for the use of the
general public, and, Landlord shall in all cases retain the right to control and
prevent access thereto of all persons whose presence in the judgment of Landlord
would be prejudicial to the safety, character, reputation and interests of the
Building and its tenants. If the Premises provide access to any exterior
balconies or deck areas, these areas shall not be used except for maintenance
access by Landlord and Tenant shall not store furniture, plants or any other
personal property in these areas. Tenant shall not go upon the roof of the
Building.

 

2. No sign, placard, picture, name, advertisement or notice visible from the
exterior of the Premises shall be inscribed, painted, affixed or otherwise
displayed by Tenant on any part of the Building without the prior written
consent of Landlord. Landlord will adopt and furnish to Tenant general
guidelines relating to signs inside the Building and Tenant agrees to conform to
such guidelines. All approved signs or lettering on doors shall be printed,
painted, affixed or inscribed at the expense of Tenant by a person approved by
Landlord, which approval will not be unreasonably withheld. Material visible
from outside the Building is not permitted.

 

3. The Premises shall not be used for the storage of merchandise held for sale
to the general public or for lodging. No cooking shall be done or permitted by
Tenant on the Premises, except that use by Tenant of Underwriters’
Laboratory-approved portable equipment for brewing coffee, tea, hot chocolate
and similar beverages, and a microwave oven, shall be permitted, provided that
such use is in accordance with all applicable federal, state and local laws,
codes, ordinances, rules and regulations. No vending machine shall be maintained
or operated within the Premises or the Building without the prior written
consent of the Landlord.

 

4. Tenant shall not employ any person or persons other than the janitor of
Landlord for the purpose of cleaning the Premises, unless otherwise agreed to by
Landlord in writing. Except with the written consent of Landlord, no person or
persons other than those approved by Landlord shall be permitted to enter the
Building for the purpose of cleaning same. Tenant shall not cause any
unnecessary labor by reason of Tenant’s carelessness or indifference in the
preservation of good order and cleanliness.

 

5. Landlord will furnish Tenant with two (2) keys to the Premises, free of
charge. Additional keys shall be obtained only from Landlord and Landlord may
make a reasonable charge for such additional keys. No additional locking devices
shall be installed in the Premises

 

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by Tenant, nor shall any locking device be changed or altered in any respect
without the prior written consent of Landlord. All locks installed in the
Premises, excluding Tenant’s vaults and safes, or special security areas (which
shall be designated by Tenant in a written notice to Landlord), shall be keyed
to the Building master key system. Landlord may make reasonable charge for any
additional lock or any bolt (including labor) installed on any door of the
Premises. Tenant, upon the termination of its tenancy, shall deliver to Landlord
all keys to doors in the Premises.

 

6. The elevators to be used for the loading of freight shall be available to
Tenant in accordance with such reasonable scheduling as Landlord shall deem
appropriate. Tenant shall schedule with Landlord, by written notice given no
less than forty-eight (48) hours in advance, its move into or out of the
Building, which moving shall occur only on weekend days if required by Landlord;
and Tenant shall reimburse Landlord upon demand for any additional security or
other charges incurred by Landlord as a consequence of such moving. The persons
employed by Tenant to move equipment or other items in or out of the Building
must be acceptable to Landlord. The floors, corners and walls of elevators and
corridors used for the moving of equipment or other items in or out of the
Building must be adequately covered, padded and protected, and Landlord may
provide such padding and protection, at Tenant’s expense, if Landlord determines
that such measures undertaken by Tenant or Tenant’s movers are inadequate.
Landlord shall have the right to prescribe the weight, size and position of all
equipment, materials, supplies, furniture or other property brought into the
Building. Heavy objects shall, if considered necessary by Landlord, stand on
wood strips of such thickness as is necessary to properly distribute the weight
of such objects. Landlord will not be responsible for loss of or damage to any
such property from any cause, and all damage done to the Building by moving or
maintaining Tenant’s property shall be repaired at the expense of Tenant.

 

7. Tenant shall not use, keep or permit or suffer the Premises to be occupied or
used in a manner offensive or objectionable to Landlord or other occupants of
the Building by reason of noise, odors and/or vibrations, or interfere in any
way with other tenants or those having business in the Building.

 

8. Landlord reserves the right to exclude from the Building during hours other
than the regular business hours for the Building established by Landlord all
persons who do not present a pass to the Building signed by Landlord and
properly in the possession of the person presenting such pass. Landlord will
furnish passes to persons for whom Tenant requests same in writing. 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 in no case be liable
for damages for any error with regard to the admission to or exclusion from the
Building of any person. In the case of invasion, mob, riot, public excitement or
other circumstances rendering such action advisable in Landlord’s opinion,
Landlord reserves the right to prevent access to the Building during the
continuance of same by such action as Landlord may deem appropriate, including
closing any doors in the Building.

 

9. A directory of the Building will be provided for the display of the name and
location of tenants and Landlord reserves the right to exclude any other names
therefrom. Any additional name that Tenant shall desire to place upon the
directory must first be approved by Landlord and, if so approved, a charge will
be made for each such name.

 

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10. No curtains, draperies, blinds, shutters, shades, screens or other
coverings, hangings or decorations shall be attached to, hung or placed in, or
used in connection with any window of the Building without the prior written
consent of Landlord. In any event, with the prior written consent of the
Landlord, such items shall be installed on the office side of Landlord’s
standard window covering and shall in no way be visible from the exterior of the
Building. The windows, glass lights, and any lights or skylights that reflect or
admit light into the halls or other places of the Building shall not be covered
or obstructed.

 

11. Tenant shall see that the doors of the Premises are closed and locked and
that all water faucets, water apparatus and utilities are shut off before Tenant
or Tenant’s employees leave the Premises, so as to prevent waste or damage. On
multiple-tenancy floors, all tenants shall keep the doors of the Premises
opening onto the Building corridors closed at all times except for ingress and
egress, and all tenants shall at all times comply with any rules or orders of
the fire department with respect to ingress and egress.

 

12. 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 deposited therein, and any
damages resulting to same from Tenant’s misuse thereof shall be paid for by
Tenant.

 

13. Tenant shall not install any radio or television antenna, loudspeaker, or
other device on or about the roof area or exterior walls of the building.

 

14. Tenant shall not use any hand trucks except those equipped with rubber tires
and side guards or such other material-handling equipment as Landlord may
approve. No other vehicles of any kind shall be brought by Tenant into the
Building or kept in or about the Premises.

 

15. Tenant shall not sweep or throw or permit to be swept or thrown from the
Premises any dirt or other substance into any of the corridors or halls or
elevators, or out of the doors or windows or stairways of the Building. Tenant
shall store all its trash and garbage within the Premises until removal of same
to such location in the Building as may be designated from time to time by
Landlord. No material shall be placed in the Building trash boxes or receptacles
if such material is of such nature that it may not be disposed of in the
ordinary and customary manner of removing and disposing of trash and garbage in
the City of San Francisco without being in violation of any law or ordinance
governing such disposal.

 

16. All loading and unloading of merchandise, supplies, materials, garbage and
refuse shall be made only through such entryways and freight elevators and at
such times as Landlord shall designate. No furniture, packages or merchandise
shall be received or carried up or down in the passenger elevators of the
Building. In its use of the loading areas of the Building, Tenant shall not
obstruct or permit the obstruction of said loading areas, and at no time shall
Tenant park vehicles therein except for immediate loading and unloading
purposes.

 

17. Canvassing, soliciting, peddling or distribution of handbills or any other
written material in the Building is prohibited and Tenant shall cooperate to
prevent same.

 

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18. Landlord reserves the right to select the name of the Building and to make
such change or changes of name as it may deem appropriate from time to time.
Tenant shall not use the name of the Building in any respect other than as an
address of its operation in the Building without the prior written consent of
Landlord.

 

19. All incoming mail and package deliveries shall be received at the area in
the Building designated by Landlord for such purposes and distributed through
means established by Landlord. No messenger or other delivery personnel shall be
permitted to enter any area of the Building other than the area designated by
Landlord for the pick-up and receipt of such deliveries. Landlord shall
immediately notify Tenant as soon as possible after a delivery for Tenant has
been received.

 

20. Landlord reserves the right to exclude or expel from the Building any person
who is, in the judgment of Landlord, intoxicated or under the influence of
alcohol or other drug or who is in violation of any of the Rules or Regulations
of the Building.

 

21. No animal or bird shall be permitted in the Premises or the Building.

 

22. The requirements of Tenant will be attended to only upon application by
telephone or writing or in person at the management office of the Building.
Employees of Landlord shall not perform any work or do anything outside of their
regular duties unless under special instructions from Landlord.

 

23. 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 these 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.

 

24. Wherever the word “Tenant” occurs in these Rules and Regulations, it is
understood and agreed that it shall mean Tenant’s associates, agents, clerks,
employees and visitors. Wherever the word “Landlord” occurs in these Rules and
Regulations, it is understood and agreed that it shall mean Landlord’s assigns,
agents, clerks, employees and visitors.

 

25. These Rules and Regulations are in addition to, and shall not be construed
in any way to modify, alter or amend, in whole or part, the terms, covenants,
agreements and conditions of any lease of premises in the Building.

 

26. Landlord reserves the right to amend or revise these Rules and Regulations
and make such other and reasonable rules and regulations as in its judgment may
from time to time be needed for the safety, care and cleanliness of the
Building, and for the preservation of good order therein, and such amendments,
revisions and additional rules and regulations shall be effective and binding
upon Tenant upon written notice to Tenant.

 

27. Tenant shall be responsible for the observance of all of the foregoing Rules
and Regulations by Tenant’s employees, agents, clients, customers, invitees and
guests.

 

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TABLE OF CONTENTS

 

1.

   PREMISES    1

2.

   TERM    2

3.

   RENT    2

4.

   OPERATING EXPENSES AND PROPERTY TAXES    4

5.

   OTHER TAXES PAYABLE BY TENANT    6

6.

   USE    7

7.

   SERVICES    8

8.

   MAINTENANCE AND REPAIRS    10

9.

   ALTERATIONS    11

10.

   INDEMNIFICATION AND RELEASE OF LANDLORD    13

11.

   INSURANCE    14

12.

   COMPLIANCE WITH LEGAL REQUIREMENTS    16

13.

   ASSIGNMENT OR SUBLEASE    17

14.

   RULES AND REGULATIONS    19

15.

   ENTRY BY LANDLORD    19

16.

   EVENTS OF DEFAULT AND REMEDIES    20

17.

   DAMAGE OR DESTRUCTION    22

18.

   EMINENT DOMAIN    24

19.

   SUBORDINATION, MERGER AND SALES    24

20.

   ESTOPPEL CERTIFICATE    25

21.

   HOLDING OVER    26

22.

   SECURITY DEPOSIT    26

23.

   WAIVER    27

24.

   NOTICES    27

25.

   MISCELLANEOUS    28

 

Exhibit A – Floor Plan Outlining the Premises

 

Exhibit B – Rules and Regulations

 

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49 STEVENSON STREET

 

GUARANTY OF LEASE

 

This GUARANTY OF LEASE (“Guaranty”) is executed as of July 28, 2005, pursuant to
the terms of that certain Office Lease, executed concurrently herewith by and
between OP&F Stevenson Street Corporation, a California corporation (“Landlord”)
and Lionbridge U.S., Inc., a Delaware corporation (“Tenant”), relating to the
leasing by Landlord to Tenant of certain Premises known as Suite 1400 (the
“Premises”) on the fourteenth floor of that certain office building (the
“Building”) located at 49 Stevenson Street, San Francisco, California (the
“Lease”). The undersigned, Lionbridge Technologies, Inc., a Delaware corporation
(“Guarantor”), is directly benefited by the execution of the Lease. In
consideration of such benefits, and as the material inducement to Landlord to
enter into the Lease, Guarantor agreed to enter into this Guaranty. Guarantor
acknowledges and understands that Landlord would not have agreed to enter into
the Lease but for this Guaranty.

 

1. Guaranty. As an essential inducement to Landlord’s entering into the Lease,
Guarantor hereby unconditionally and irrevocably guarantees to Landlord the
timely payment and performance by Tenant of all rent, charges, and the payment
and performance of all other obligations under and arising out of the Lease, and
all other documents evidencing or securing the obligations under such Lease to
be paid or performed (collectively, the “Guarantied Obligations”). Guarantor
acknowledges, covenants and agrees that this Guaranty shall survive the
termination of the Lease and shall continue in full force and effect with
respect to any of Tenant’s obligations under the Lease which are not performed
upon and which survive the termination of the Lease. This is a continuing
Guaranty relating to the Guarantied Obligations, including, without limitation,
obligations and liabilities arising under modifications or amendments to the
Lease that either increase, decrease or continue the Guarantied Obligations, or,
from time to time, renew Guarantied Obligations that have been satisfied,
independent of and in addition to any other guaranty, endorsement, or collateral
now or hereafter held by Landlord, whether or not furnished by the Guarantor.

 

2. Rights of Landlord. Guarantor consents that the Landlord may and hereby
authorizes Landlord at any time in its discretion to, without notice or demand
and without affecting the indebtedness and liabilities of Guarantor hereunder,
(i) alter any of the terms of the Guarantied Obligations, including without
limitation, renewing, amending, releasing, waiving, compromising, extending or
accelerating, or otherwise changing the time for payment of, or increasing or
decreasing the Guarantied Obligations or the rate of interest on the Guarantied
Obligations; accepting new or additional documents, instruments or agreements
relative to the Guarantied Obligations; consenting to the change, restructure or
termination of the entity comprising Tenant, Guarantor or any other person or
any affiliate of Tenant, Guarantor or any other person, and correspondingly
restructure the Guarantied Obligations; accepting partial payments on the
Guarantied Obligations; taking and holding any security or additional guaranties
for the Guarantied Obligations and amending, altering, exchanging, substituting,
transferring, enforcing, perfecting or failing to perfect, waiving,
subordinating, terminating, compromising, or releasing any such security or
guaranties; applying any security, and directing the order and

 

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manner of sale thereof as Landlord in its sole discretion may determine;
settling, releasing on terms satisfactory to Landlord or by operation of law or
otherwise, compounding, compromising, collecting or otherwise liquidating the
Guarantied Obligations and/or the security or any guaranty therefor in any
manner; releasing Tenant or any other person of its liability for all or any of
the Guarantied Obligations; participating in any settlement offered by Tenant,
any guarantor or any other person, whether in liquidation, reorganization,
receivership, bankruptcy, assignment for the benefit of creditors or other
debtor-relief proceeding or otherwise; exercising or not exercising rights
available to it in any liquidation, reorganization, receivership, bankruptcy,
assignment for benefit of creditors or other debtor-relief proceeding, including
voting or not voting to accept a plan and filing or not filing a proof of claim;
releasing, substituting or adding any one or more guarantors or endorsers; and
(ii) assign this Guaranty, or any of the Guarantied Obligations, in whole or in
part. Landlord may take any of the foregoing actions upon any terms and
conditions as Landlord may elect, without giving notice to Guarantor or
obtaining the consent of Guarantor and without affecting the liability of
Guarantor to Landlord.

 

3. Tenant’s Financial Condition. Guarantor is relying upon his own knowledge and
is fully informed with respect to Tenant’s financial condition. Guarantor
assumes full responsibility for keeping fully informed of the financial
condition of Tenant and all other circumstances affecting Tenant’s ability to
perform its obligations to Landlord, and agrees that Landlord will have no duty
to report to Guarantor any information which Landlord receives about Tenant’s
financial condition or any circumstances bearing on Tenant’s ability to perform
all or any portion of the Guarantied Obligations, regardless of whether Landlord
has reason to believe that any such facts materially increase the risk beyond
that which Guarantor intends to assume or has reason to believe that such facts
are unknown to Guarantor or have a reasonable opportunity to communicate such
facts to Guarantor.

 

4. Default. The occurrence of any one of the following events shall, at the
election of Landlord, be deemed an event of default by Guarantor under this
Guaranty: (i) Guarantor shall fail or neglect to perform, keep or observe any
term, provision, condition or covenant, contained in this Guaranty; (ii) if any
representation or warranty made in this Guaranty shall be false in any material
respect; (iii) if any material portion of Guarantor’s assets are seized,
attached, subjected to a writ, or are levied upon, or come within the possession
of any receiver, trustee, custodian or assignee for the benefit of creditors and
the same is not terminated or dismissed within sixty (60) days thereafter;
(iv) if a petition under any state or federal bankruptcy or insolvency law or
statute or any similar law or regulation shall be filed by Guarantor, or if
Guarantor shall make an assignment for the benefit of creditors; (v) if
Guarantor is enjoined, restrained or any way prevented by court order from
conducting all or any material part of Guarantor’s business affairs or if a
petition under any section or chapter of any state or federal bankruptcy or
insolvency law or statute or any similar law or regulation is filed against
Guarantor or if any case or proceeding is filed against Guarantor for
liquidation of Guarantor’s assets and such injunction, restraint or petition is
not dismissed or stayed within sixty (60) days after the entry or the filing
thereof; (vi) if an application is made by the Guarantor for the appointment of
a receiver, trustee, conservator or custodian for all or a material portion of
Guarantor’s assets; (vii) if an application is made by any person other than
Guarantor for the appointment of a receiver, trustee, custodian or conservator
for all or a material portion of Guarantor’s assets and the same is not
dismissed within sixty (60) days after the application therefor; or (viii) if a
notice of lien, levy or

 

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assessment is filed of record with respect to all or a material portion of
Guarantor’s assets by the United States or any department, agency or
instrumentality thereof or by any state, county, municipal or other governmental
agency, or if any taxes or debts owing at any time or times hereafter to any one
of them becomes a lien or encumbrance upon all or a material portion of
Guarantor’s assets. Upon the occurrence of an event of default, the Guarantied
Obligations hereunder shall be, at the option of Landlord, accelerated and shall
all be due and payable and enforceable against Guarantor, whether or not the
Guarantied Obligations are then due and payable and Landlord may, in its sole
discretion, in addition to any other right or remedy provided by law, all of
which are cumulative and non-exclusive, proceed to suit against Guarantor,
whether suit has been commenced against Tenant.

 

5. Costs and Expenses. Guarantor agrees to pay, upon demand, Landlord’s
reasonable costs and expenses, including but not limited to reasonable legal
fees and disbursements, incurred in any effort to collect or enforce any of the
Guarantied Obligations or this Guaranty, whether or not any lawsuit is filed,
and in the representation of Landlord in any insolvency, bankruptcy,
reorganization or similar proceeding relating to Tenant or Guarantor. Until paid
to Landlord, such sums will bear interest from the date such costs and expenses
are incurred at the rate set forth in the Lease for past due obligations. The
obligations of Guarantor under this Section 5 shall include payment of
Landlord’s costs and expenses of enforcing any judgment, which obligations shall
be severable from the remaining provisions of this Guaranty and shall survive
the entry of judgment.

 

6. Reinstatement. The liability of Guarantor hereunder shall be reinstated and
revived, and the rights of Landlord shall continue, with respect to any amount
at any time paid on account of the Guarantied Obligations which Landlord shall
thereafter be required to restore or return in connection with the bankruptcy,
insolvency or reorganization of Tenant, or Guarantor, or otherwise, all as
though such amount had not been paid. The determination as to whether any such
payment must be restored or returned shall be made by Landlord in its sole
discretion. Landlord shall be under no obligation to return or deliver this
Guaranty to Guarantor, notwithstanding the payment of the Guarantied
Obligations. If this Guaranty is nevertheless returned to Guarantor or is
otherwise released, then the provisions of this Section 6 shall survive such
return or release, and the liability of Guarantor under this Guaranty shall be
reinstated and continued under the circumstances provided in this Section 6
notwithstanding such return or release.

 

7. Representations and Warranties. Guarantor makes the following representations
and warranties, which shall be deemed to be continuing representations and
warranties until payment and performance in full of the Guarantied Obligations:

 

7.1 Guarantor has all the requisite power and authority to execute, deliver and
be legally bound by this Guaranty on the terms and conditions herein stated;

 

7.2 This Guaranty constitutes the legal, valid and binding obligations of
Guarantor enforceable against Guarantor in accordance with its terms;

 

7.3 Neither the execution and delivery of this Guaranty nor the consummation of
the transactions contemplated hereby will, with or without notice and/or lapse
of time,

 

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constitute a breach of any of the terms and provisions of any note, contract,
document, agreement or undertaking, whether written or oral, to which Guarantor
is a party or to which Guarantor’s property is subject, accelerate or constitute
any event entitling the holder of any indebtedness of Guarantor to accelerate
the maturity of any such indebtedness, conflict with or result in a breach of
any writ, order, injunction or decree against Guarantor of any court or
governmental agency or instrumentality, or conflict with or be prohibited by any
federal, state, local or other governmental law, statute, rule or regulation;

 

7.4 No consent of any other person not heretofore obtained and no consent,
approval or authorization of any person or entity is required in connection with
the valid execution, delivery or performance by Guarantor of this Guaranty; and

 

7.5 Guarantor is not insolvent, and will not be rendered insolvent by the
incurring of its obligations hereunder.

 

8. Bankruptcy. So long as any Guarantied Obligations shall be owing to Landlord,
Guarantor shall not, without the prior written consent of Landlord, commence, or
join with any other person or entity in commencing, any bankruptcy,
reorganization, or insolvency proceeding against Tenant. The obligations of
Guarantor under this Guaranty shall not be altered, limited, or affected by any
proceeding, voluntary or involuntary, involving the bankruptcy, insolvency,
receivership, reorganization, liquidation, or arrangement of Tenant, or by any
defense Tenant may have by reason of any order, decree, or decision of any court
or administrative body resulting from any such proceeding.

 

9. Claims in Bankruptcy. Guarantor shall file in any bankruptcy or other
proceeding in which the filing of claims is required or permitted by law all
claims that Guarantor may have against Tenant relating to any indebtedness of
Tenant to Guarantor, and upon request will assign to Landlord all rights of
Guarantor thereunder. If Guarantor does not file any such claim, then to the
extent allowed by law, Landlord, as attorney-in-fact for Guarantor, is hereby
authorized to do so in the name of Guarantor or, in Landlord’s discretion, to
assign the claim to a nominee, and to cause proof of claim to be filed in the
name of Landlord’s nominee. The foregoing power of attorney is coupled with an
interest and cannot be revoked. Landlord, or its nominee, shall have the right
to accept or reject any plan proposed in such proceedings in its reasonable
business judgment and to take any other action that a party filing a claim is
entitled to do. In all such cases, whether in administration, bankruptcy, or
otherwise, the person or persons authorized to pay such claim shall pay to
Landlord the amount payable on such claim. Guarantor hereby assigns to Landlord
all of Guarantor’s rights to any such payments or distributions to which
Guarantor would otherwise be entitled; provided, however, that Guarantor’s
obligations hereunder shall not be satisfied except to the extent that Landlord
receives cash by reason of any such payment or distribution. If Landlord
receives anything hereunder other than cash, the same shall be held as
collateral for amounts due under this Guaranty.

 

10. New Lease Provision. Guarantor expressly agrees (without in any way limiting
its liability under any provisions of this Guaranty) that Guarantor (or the
designee of Guarantor), at the request of Landlord, shall enter into a new lease
with Landlord upon the same terms and conditions as contained in the Lease
immediately prior to its termination (hereinafter described) for a term
commencing on the termination date and ending on the expiration date as set
forth

 

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therein if under any proceeding under the Bankruptcy Act of the United States,
as amended from time to time, or any proceeding under any other similar present
or future federal or state law, or as a result of the operation of any present
or future provisions of the Bankruptcy Act or any similar statute or as a result
of the decision of any court interpreting any of the same, the Lease shall be
terminated or rejected or the obligations of Tenant thereunder or any rights or
remedies of Landlord against Tenant shall be limited, impaired, stayed, changed,
released or modified on account of the same. If a designee of Guarantor shall
enter into such a lease, Guarantor shall, contemporaneously therewith, enter
into a guaranty identical to this Guaranty with respect to the obligations of
such designee under said lease.

 

11. Joint and Several Liability. The obligations and promises of Guarantor set
forth herein and of all other guarantors of the Lease shall be the joint and
several undertakings with each Guarantor being fully responsible and liable to
the full extent of the Guaranteed Obligations.

 

12. Inducement. Guarantor acknowledges that the undertaking given hereunder is
given in consideration of Landlord’s entering into the Lease and that Landlord
would not consummate the Lease but for the execution and delivery of this
Guaranty.

 

13. Notice. All notices and other communications provided for hereunder shall be
in writing (including telecopied communication) and mailed or telecopied or
delivered to the parties at Landlord’s address designated in the Lease or at
Guarantor’s address as set forth on the signature page hereto, or, as to each
party, at such other address as shall be designated by such party in a written
notice to the other parties complying as to delivery with the terms of this
Section 13. All such notices and communications, if mailed, shall be effective
two (2) business days after deposit in the United States mail, first-class (or
certified) postage prepaid; if telecopied, shall be effective when transmitted
and confirmed; and if delivered in another way, shall be effective upon receipt.

 

14. Miscellaneous. No provision of this Guaranty or Landlord’s rights hereunder
can be waived or modified nor can Guarantor be released from its obligations
hereunder except by a writing executed by Landlord. No such waiver shall be
applicable except in the specific instance for which given. No delay or failure
by Landlord to exercise any right or remedy against Tenant or Guarantor will be
construed as a waiver of that right or remedy. All remedies of Landlord against
Tenant and Guarantor are cumulative. The invalidity or unenforceability of any
one or more provisions of this Guaranty will not affect the validity or
enforceability of any other provision. This Guaranty shall be governed by and
construed under the laws of the State of California. The provisions of this
Guaranty will bind and benefit the heirs, executors, administrators, legal
representatives, successors and assigns of Guarantor and Landlord. The term
“Tenant” will mean both the named Tenant and any other person or entity at any
time assuming or otherwise becoming primarily liable for all or any part of the
Guarantied Obligations. The term “Landlord” will mean both the Landlord named
herein and any future owner or holder of the Lease, or any interest therein.
This Guaranty constitutes the entire agreement between Guarantor and Landlord
with respect to its subject matter, and supersedes all prior or contemporaneous
agreements, representations and understandings. All headings in this Guaranty
are for convenience only and shall be disregarded in construing the substantive
provisions of this Guaranty.

 

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15. Limitation on Liability. Any provision hereof to the contrary
notwithstanding, it is the intent of the parties that the liability of Guarantor
hereunder shall not be greater than its liability would be as a maker of the
Lease. Guarantor is giving this Guaranty on the condition, and by its acceptance
of this Guaranty Landlord is agreeing to the condition, that Guarantor shall be
entitled to all defenses, setoffs, counterclaims, rights of subrogation,
reimbursement and indemnity and rights of enforcement that the Tenant is or
shall become entitled to under the Lease.

 

IN WITNESS WHEREOF, the undersigned Guarantor has executed this Guaranty where
provided below as of the date first above written.

 

        GUARANTOR:

Address of Guarantor:

      LIONBRIDGE TECHNOLOGIES, INC.,

1050 Winter Street

     

a Delaware corporation

Waltham, Massachusetts 02451

                    By:   LOGO [g24780img_012.jpg]            

Name:

  David W. Dahn            

Its:

  Treasurer

 

OP&F – 49 Stevenson Street

Lionbridge Technologies – Lease Guaranty