Exhibit 10.2

 

OFFICE LEASE

 

221 MAIN STREET

 

221 MAIN PROPERTY OWNER LLC,

a Delaware limited liability company,

 

as Landlord,

 

and

 

C1 CONSULTING LIMITED LIABILITY COMPANY,

 

a New Jersey limited liability company,

 

as Tenant.

 

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

 

TABLE OF CONTENTS

 

 

 

Page

 

 

 

ARTICLE 1

PREMISES, BUILDING, PROJECT, AND COMMON AREAS

4

ARTICLE 2

LEASE TERM

5

ARTICLE 3

BASE RENT

5

ARTICLE 4

ADDITIONAL RENT

6

ARTICLE 5

USE OF PREMISES

11

ARTICLE 6

SERVICES AND UTILITIES

11

ARTICLE 7

REPAIRS

13

ARTICLE 8

ADDITIONS AND ALTERATIONS

14

ARTICLE 9

COVENANT AGAINST LIENS

15

ARTICLE 10

INSURANCE

16

ARTICLE 11

DAMAGE AND DESTRUCTION

18

ARTICLE 12

NONWAIVER

19

ARTICLE 13

CONDEMNATION

19

ARTICLE 14

ASSIGNMENT AND SUBLETTING

20

ARTICLE 15

SURRENDER OF PREMISES; OWNERSHIP AND REMOVAL OF TRADE FIXTURES

23

ARTICLE 16

HOLDING OVER

23

ARTICLE 17

ESTOPPEL CERTIFICATES

24

ARTICLE 18

SUBORDINATION

24

ARTICLE 19

DEFAULTS; REMEDIES

24

ARTICLE 20

COVENANT OF QUIET ENJOYMENT

26

ARTICLE 21

SECURITY DEPOSIT

26

ARTICLE 22

SUBSTITUTION OF OTHER PREMISES

27

ARTICLE 23

SIGNS

27

ARTICLE 24

COMPLIANCE WITH LAW

27

ARTICLE 25

LATE CHARGES

28

ARTICLE 26

LANDLORD’S RIGHT TO CURE DEFAULT; PAYMENTS BY TENANT

28

ARTICLE 27

ENTRY BY LANDLORD

28

ARTICLE 28

COMMUNICATIONS AND COMPUTER LINES

29

ARTICLE 29

MISCELLANEOUS PROVISIONS

29

 

EXHIBITS

 

A

OUTLINE OF PREMISES

B

TENANT WORK LETTER

C

FORM OF NOTICE OF LEASE TERM DATES

D

RULES AND REGULATIONS

E

FORM OF TENANT’S ESTOPPEL CERTIFICATE

 

i

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

 

INDEX

 

 

Page(s)

 

 

Alterations

14

Base Rent

5

Base Taxes

9

Base Year

6

Brokers

32

Building

4

Building Common Areas

4

Building Hours

11

Common Areas

4

Comparable Buildings

4

Contemplated Effective Date

21

Contemplated Transfer Space

21

Cost Pools

10

Direct Expenses

6

Estimate

10

Estimate Statement

10

Estimated Excess

10

Excess

10

Expense Year

6

Force Majeure

31

Holidays

11

HVAC

11

Identification Requirements

29

Intention to Transfer Notice

21

Landlord

1

Landlord Parties

16

Landlord Repair Notice

18

Lease

1

Lease Commencement Date

5

Lease Expiration Date

5

Lease Term

5

Lease Year

5

Lines

29

Mail

31

Notices

31

Operating Expenses

6

Original Improvements

17

Premises

4

Project

4

Proposition 13

9

Renovations

33

Security Deposit

26

Six Month Period

22

Statement

10

Subject Space

20

Summary

1

Tax Expenses

9

Tenant

1

Tenant Work Letter

4

Tenant’s Share

10

Transfer Notice

20

Transferee

20

 

ii

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

 

221 MAIN STREET

 

OFFICE LEASE

 

This Office Lease (the “Lease”), dated as of the date set forth in Section 1 of
the Summary of Basic Lease Information (the “Summary”), below, is made by and
between 221 MAIN PROPERTY OWNER LLC, a Delaware limited liability company
(“Landlord”), and C1 CONSULTING LIMITED LIABILITY COMPANY, a New Jersey limited
liability company(“Tenant”).

 

SUMMARY OF BASIC LEASE INFORMATION

 

TERMS OF LEASE

 

DESCRIPTION

 

 

 

 

1.

Date:

 

April 2, 2013

 

 

 

 

2.

Premises

 

 

 

(Article 1).

 

 

 

 

 

 

 

2.1

Building:

 

221 Main Street

 

 

 

 

San Francisco, California 94105

 

 

 

 

containing approximately 384,903 rentable square feet of space

 

 

 

 

 

 

2.2

Premises:

 

Approximately 2,694 rentable square feet of space located on the fifteenth
(15th) floor of the Building and commonly known as Suite 1580, as further set
forth in Exhibit A to the Office Lease.

 

 

 

 

 

3.

Lease Term

 

 

 

(Article 2).

 

 

 

 

 

 

 

 

3.1

Length of Term:

 

Five (5) years and two (2) months.

 

 

 

 

 

 

3.2

Lease Commencement Date:

 

The earlier to occur of (i) the date upon which Tenant first commences to
conduct business in the Premises and (ii) the date upon which the Premises are
Ready for Occupancy, which is anticipated to be June 1, 2013.

 

 

 

 

 

 

3.3

Lease Expiration Date:

 

If the Lease Commencement Date shall be the first day of a calendar month, then
the day immediately preceding the sixty-two (62) month anniversary of the Lease
Commencement Date; or, if the Lease Commencement Date shall be other than the
first day of a calendar month, then the last day of the month in which the
sixty-two (62) month anniversary of the Lease Commencement Date occurs.

 

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

 

4.

Base Rent (Article 3):

 

 

 

 

 

 

 

 

 

Annual

 

 

 

 

 

Monthly

 

Rental Rate

 

 

 

Annual

 

Installment

 

per Rentable

 

Lease Year

 

Base Rent

 

of Base Rent

 

Square Foot

 

 

 

 

 

 

 

 

 

1*

 

$

148, 170.00

 

$

12,347.50

 

$

55.00

 

 

 

 

 

 

 

 

 

2

 

$

152,615.10

 

$

12,717.93

 

$

56.65

 

 

 

 

 

 

 

 

 

3

 

$

157,194.90

 

$

13,099.58

 

$

58.35

 

 

 

 

 

 

 

 

 

4

 

$

161,909.40

 

$

13,492.45

 

$

60.10

 

 

 

 

 

 

 

 

 

5

 

$

166,758.60

 

$

13,896.55

 

$

61.90

 

 

 

 

 

 

 

 

 

6 – Lease Expiration Date

 

N/A

 

$

14,314.12

 

$

63.76

 

 

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

*Subject to the terms of Section 3.2, below.

 

5.

Base Year

 

 

 

(Article 4):

 

Calendar year 2013.

 

 

 

 

6.

Tenant’s Share

 

 

 

(Article 4):

 

Approximately 0.7%.

 

 

 

 

7.

Permitted Use

 

 

 

(Article 5):

 

General office use consistent with a first-class office building.

 

 

 

8.

Security Deposit

 

 

 

(Article 21):

 

$12,347.50.

 

 

 

 

9.

Address of Tenant

 

 

 

(Section 29.18):

 

C1 Consulting LLC

 

 

 

129 Summit Ave, Suite 200

 

 

 

Summit, NJ 07901

 

 

 

(Prior to Lease Commencement Date)

 

 

 

 

 

 

 

And

 

 

 

 

 

 

 

C1 Consulting Limited Liability Company

 

 

 

221 Main Street, Suite 1580

 

 

 

San Francisco, California 94105

 

 

 

(After Lease Commencement Date)

 

 

 

 

10.

Address of Landlord

 

 

 

(Section 29.18):

 

See Section 29.18 of the Lease.

 

2

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

 

11.

Broker(s)

 

CAC Group, Inc.

 

(Section 29.24):

 

255 California Street, 2nd Floor

 

 

 

San Francisco, California 94111

 

 

 

 

 

 

 

and

 

 

 

 

 

 

 

Colton Commercial & Partners, Inc.

 

 

 

565 Commercial Street, 4th Floor

 

 

 

San Francisco, California 94111

 

3

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

 

ARTICLE 1

 

PREMISES, BUILDING, PROJECT, AND COMMON AREAS

 

1.1                               Premises, Building, Project and Common Areas.

 

1.1.1                     The Premises. Landlord hereby leases to Tenant and
Tenant hereby leases from Landlord the premises set forth in Section 2.2 of the
Summary (the “Premises”). The outline of the Premises is set forth in Exhibit A
attached hereto. The parties hereto agree that the lease of the Premises is upon
and subject to the terms, covenants and conditions herein set forth, and Tenant
covenants as a material part of the consideration for this Lease to keep and
perform each and all of such terms, covenants and conditions by it to be kept
and performed and that this Lease is made upon the condition of such
performance. The parties hereto hereby acknowledge that the purpose of Exhibit A
is to show the approximate location of the Premises in the “Building,” as that
term is defined in Section 1.1.2, below, only, and such Exhibit is not meant to
constitute an agreement, representation or warranty as to the construction of
the Premises, the precise area thereof or the specific location of the “Common
Areas,” as that term is defined in Section 1.1.3, below, or the elements thereof
or of the accessways to the Premises or the “Project,” as that term is defined
in Section 1.1.2, below. Except as specifically set forth in this Lease and in
the Tenant Work Letter attached hereto as Exhibit B (the “Tenant Work Letter”),
Landlord shall not be obligated to provide or pay for any improvement work or
services related to the improvement of the Premises. Tenant also acknowledges
that neither Landlord nor any agent of Landlord has made any representation or
warranty regarding the condition of the Premises, the Building or the Project or
with respect to the suitability of any of the foregoing for the conduct of
Tenant’s business, except as specifically set forth in this Lease and the Tenant
Work Letter. The commencement of business operations from by Tenant shall
presumptively establish that the Premises and the Building were at such time in
good and sanitary order, condition and repair, except for minor “punchlist”
matters related to the Building brought to Landlord’s attention within ten
(10) days after Tenant commences business operations from the Premises.

 

1.1.2                     The Building and The Project. The Premises are a part
of the building set forth in Section 2.1 of the Summary (the “Building”). The
Building is part of an office project currently known as “221 Main Street.” The
term “Project,” as used in this Lease, shall mean (i) the Building and the
Common Areas, (ii) the land (which is improved with landscaping, above ground
and subterranean parking facilities and other improvements) upon which the
Building and the Common Areas are located, and (iii) at Landlord’s discretion,
any additional real property, areas, land, buildings or other improvements added
thereto outside of the Project.

 

1.1.3                     Common Areas. Tenant shall have the non-exclusive
right to use in common with other tenants in the Project, and subject to the
rules and regulations referred to in Article 5 of this Lease, those portions of
the Project which are provided, from time to time, for use in common by
Landlord, Tenant and any other tenants of the Project (such areas, together with
such other portions of the Project designated by Landlord, in its discretion,
including certain areas designated for the exclusive use of certain tenants, or
to be shared by Landlord and certain tenants, are collectively referred to
herein as the “Common Areas”). The Common Areas shall consist of the “Project
Common Areas” and the “Building Common Areas.” The term “Project Common Areas,”
as used in this Lease, shall mean the portion of the Project designated as such
by Landlord. The term “Building Common Areas,” as used in this Lease, shall mean
the portions of the Common Areas located within the Building designated as such
by Landlord. The manner in which the Common Areas are maintained and operated
shall be at the sole discretion of Landlord and the use thereof shall be subject
to such rules, regulations and restrictions as Landlord may make from time to
time. Landlord reserves the right to close temporarily, make alterations or
additions to, or change the location of elements of the Project and the Common
Areas.

 

1.1.4                     Asbestos-Containing Materials. Tenant acknowledges and
agrees that (i) the Project was constructed at a time when asbestos was commonly
used in construction, (ii) asbestos and asbestos-containing materials
(collectively, “ACM”) may be present at the Project, and (iii) airborne asbestos
fibers may be released and result in a potential health hazard if proper ACM
containment, remediation and abatement procedures are not observed. Except as
otherwise provided in this Lease and the Tenant Work Letter, Tenant shall be
solely responsible for all costs related to ACM that arise in connection with
Tenant’s occupancy, use, modification, alteration or improvement of the
Premises. In connection with any modifications, alterations or improvements
contemplated to be performed by Tenant in the Premises, Tenant (including its
contractors and other agents) shall consult with Landlord and Landlord’s
asbestos

 

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

 

consultant concerning appropriate procedures to be followed in connection with
ACM prior to performing any such work in the Premises. All such work shall be
subject to the terms of Article 8 below. During the performance of any such
work, Tenant (including its contractors and other agents) shall comply with all
applicable laws, rules, regulations and other governmental requirements, as well
as all directives of Landlord and Landlord’s asbestos consultant, relating to
ACM. Tenant hereby irrevocably appoints Landlord and Landlord’s asbestos
consultant as Tenant’s attorney-in-fact for purposes of supervising and
directing any ACM-related aspects of Tenant’s contemplated work in the Premises
(provided that such appointment shall not relieve Tenant from its obligations
hereunder, nor impose any affirmative obligation on Landlord to provide such
supervision or direction). In connection with any such work that may affect ACM
in the Premises or the Project, Landlord shall have the right at any time to
cause Tenant to immediately stop such work if such work has not been approved in
writing by Landlord or if such work has deviated from the plans previously
approved by Landlord for such work.

 

 

 

EHR

Landlord’s Initials

 

Tenant’s Initials

 

ARTICLE 2

 

LEASE TERM

 

The terms and provisions of this Lease shall be effective as of the date of this
Lease. The term of this Lease (the “Lease Term”) shall be as set forth in
Section 3.1 of the Summary, shall commence on the date set forth in Section 3.2
of the Summary (the “Lease Commencement Date”), and shall terminate on the date
set forth in Section 3.3 of the Summary (the “Lease Expiration Date”) unless
this Lease is sooner terminated as hereinafter provided. For purposes of this
Lease, the term “Lease Year” shall mean each consecutive twelve (12) month
period during the Lease Term. At any time during the Lease Term, Landlord may
deliver to Tenant a notice in the form as set forth in Exhibit C, attached
hereto, as a confirmation only of the information set forth therein, which
Tenant shall execute and return to Landlord within ten (10) days of receipt
thereof, provided that if said notice is not factually correct, then Tenant
shall make such changes as are necessary to make the notice factually correct
and shall thereafter execute and return such notice to Landlord within such ten
(10) day period, and if Landlord determines that Tenant’s changes are factually
correct, then Landlord shall thereafter countersign such notice, but if Landlord
determines that such changes are not factually correct then Landlord shall
notify Tenant of the same and Landlord and Tenant shall thereafter use
commercially reasonable efforts to agree upon the information set forth in such
notice, following which the parties shall execute such notice.

 

ARTICLE 3

 

BASE RENT

 

3.1                               In General. Tenant shall pay, without prior
notice or demand, to Landlord or Landlord’s agent at the management office of
the Project, or, at Landlord’s option, at such other place as Landlord may from
time to time designate in writing, by a check for currency which, at the time of
payment, is legal tender for private or public debts in the United States of
America, base rent (“Base Rent”) as set forth in Section 4 of the Summary,
payable in equal monthly installments as set forth in Section 4 of the Summary
in advance on or before the first day of each and every calendar month during
the Lease Term, without any setoff or deduction whatsoever. The Base Rent for
the first full month of the Lease Term which occurs after the expiration of any
free rent period shall be paid at the time of Tenant’s execution of this Lease.
If any Rent payment date (including the Lease Commencement Date) falls on a day
of the month other than the first day of such month or if any payment of Rent is
for a period which is shorter than one month, the Rent for any fractional month
shall accrue on a daily basis for the period from the date such payment is due
to the end of such calendar month or to the end of the Lease Term at a rate per
day which is equal to 1/365 of the applicable annual Rent. All other payments or
adjustments required to be made under the terms of this Lease that require
proration on a time basis shall be prorated on the same basis.

 

3.2                               Abated Base Rent. Provided that Tenant is not
then in default under the terms of this Lease, then Tenant shall not be
obligated to pay the Base Rent otherwise attributable to the Premises (the “Rent
Abatement”) during the first two (2) full calendar months of the Lease Term (the
“Rent Abatement Period”). Landlord and Tenant acknowledge that the amount of the
Rent Abatement equals $12,347.50 per month during the Rent Abatement Period.

 

5

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

 

Tenant acknowledges and agrees that the foregoing Rent Abatement has been
granted to Tenant as additional consideration for entering into this Lease, and
for agreeing to pay the Rent and perform the terms and conditions otherwise
required under this Lease. If Tenant shall be in default under this Lease and
shall fail to cure such default within the notice and cure period, if any,
permitted for cure pursuant to this Lease, then Landlord may, at its option,
elect, in addition to any other remedies Landlord may have under this Lease, one
or both of the following remedies: (i) that Tenant shall immediately become
obligated to pay to Landlord all Base Rent abated hereunder during the Rent
Abatement Period, with interest as provided pursuant to this Lease from the date
such Base Rent would have otherwise been due but for the abatement provided
herein, or (ii) that the dollar amount of the unapplied portion of the Rent
Abatement as of such default shall be converted to a credit to be applied to the
Base Rent applicable at the end of the Lease Term and Tenant shall immediately
be obligated to begin paying Base Rent for the Premises in full.

 

ARTICLE 4

 

ADDITIONAL RENT

 

4.1                               General Terms. In addition to paying the Base
Rent specified in Article 3 of this Lease. Tenant shall pay “Tenant’s Share” of
the annual “Direct Expenses,” as those terms are defined in Sections 4.2.6 and
4.2.2 of this Lease, respectively, which are in excess of the amount of Direct
Expenses applicable to the “Base Year,” as that term is defined in
Section 4.2.1, below; provided, however, that in no event shall any decrease in
Direct Expenses for any “Expense Year,” as that term is defined in Section 4.2.6
below, below Direct Expenses for the Base Year entitle Tenant to any decrease in
Base Rent or any credit against sums due under this Lease. Such payments by
Tenant, together with any and all other amounts payable by Tenant to Landlord
pursuant to the terms of this Lease, are hereinafter collectively referred to as
the “Additional Rent”, and the Base Rent and the Additional Rent are herein
collectively referred to as “Rent.” All amounts due under this Article 4 as
Additional Rent shall be payable for the same periods and in the same manner as
the Base Rent. Without limitation on other obligations of Tenant which survive
the expiration of the Lease Term, the obligations of Tenant to pay the
Additional Rent provided for in this Article 4 shall survive the expiration of
the Lease Term.

 

4.2                               Definitions of Key Terms Relating to
Additional Rent. As used in this Article 4, the following terms shall have the
meanings hereinafter set forth:

 

4.2.1                     “Base Year” shall mean the period set forth in
Section 5 of the Summary.

 

4.2.2                     “Direct Expenses” shall mean “Operating Expenses,” as
that term is defined in Section 4.2.4 below, and “Tax Expenses,” as that term is
defined in Section 4.2.5.1 below.

 

4.2.3                     “Expense Year” shall mean each calendar year in which
any portion of the Lease Term falls, through and including the calendar year in
which the Lease Term expires, provided that Landlord, upon notice to Tenant, may
change the Expense Year from time to time to any other twelve (12) consecutive
month period, and, in the event of any such change, Tenant’s Share of Direct
Expenses shall be equitably adjusted for any Expense Year involved in any such
change.

 

4.2.4                     “Operating Expenses” shall mean all expenses, costs
and amounts of every kind and nature which Landlord pays or accrues during any
Expense Year because of or in connection with the ownership, management,
maintenance, security, repair, replacement, restoration or operation of the
Project, or any portion thereof. Without limiting the generality of the
foregoing, Operating Expenses shall specifically include any and all of the
following: (i) the cost of supplying all utilities, the cost of operating,
repairing, maintaining, and renovating the utility, telephone, mechanical,
sanitary, storm drainage, and elevator systems, and the cost of maintenance and
service contracts in connection therewith; (ii) the cost of licenses,
certificates, permits and inspections and the cost of contesting any
governmental enactments which may affect Operating Expenses, and the costs
incurred in connection with a governmentally mandated transportation system
management program or similar program; (iii) the cost of all insurance carried
by Landlord in connection with the Project as reasonably determined by Landlord;
(iv) the cost of landscaping, relamping, and all supplies, tools, equipment and
materials used in the operation, repair and maintenance of the Project, or any
portion thereof; (v) the cost of parking area operation, repair, restoration,
and maintenance; (vi) fees and other costs, including management and/or
incentive fees, consulting fees, legal fees and accounting fees, of all
contractors and consultants in connection with the management, operation,
maintenance and repair of the Project; (vii) payments under

 

6

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

 

any equipment rental agreements and the fair rental value of any management
office space; (viii) subject to item (f), below, wages, salaries and other
compensation and benefits, including taxes levied thereon, of all persons
engaged in the operation, maintenance and security of the Project; (ix) costs
under any instrument pertaining to the sharing of costs by the Project,
including as relating to any business improvement district; (x) operation,
repair, maintenance and replacement of all systems and equipment and components
thereof of the Project; (xi) the cost of janitorial, alarm, security and other
services, replacement of wall and floor coverings, ceiling tiles and fixtures in
common areas, maintenance and replacement of curbs and walkways, repair to roofs
and re-roofing; (xii) amortization (including interest on the unamortized cost)
over such period of time as Landlord shall reasonably determine, of the cost of
acquiring or the rental expense of personal property used in the maintenance,
operation and repair of the Project, or any portion thereof; (xiii) the cost of
capital improvements or other costs incurred in connection with the Project
(A) which are intended to effect economies in the operation or maintenance of
the Project, or any portion thereof, or to reduce current or future Operating
Expenses or to enhance the safety or security of the Project or its occupants,
(B) that are required to comply with present or anticipated conservation
programs, (C) which are replacements or modifications of nonstructural items
located in the Common Areas required to keep the Common Areas in good order or
condition, or (D) that are required under any governmental law or regulation;
provided, however, that any capital expenditure shall be amortized (including
interest on the amortized cost) over such period of time as Landlord shall
reasonably determine; and (xiv) costs, fees, charges or assessments imposed by,
or resulting from any mandate imposed on Landlord by, any federal, state or
local government for fire and police protection, trash removal, community
services, or other services which do not constitute Tax Expenses, (xv) cost of
tenant relation programs reasonably established by Landlord, and (xvi) payments
under any easement, license, operating agreement, declaration, restrictive
covenant, or instrument pertaining to the sharing of costs by the Building,
including, without limitation, any covenants, conditions and restrictions
affecting the property, and reciprocal easement agreements affecting the
property, any parking licenses, and any agreements with transit agencies
affecting the Property (collectively, “Underlying Documents”). Notwithstanding
the foregoing, for purposes of this Lease, Operating Expenses shall not,
however, include:

 

(a)                                 costs, including legal fees, space planners’
fees, advertising and promotional expenses (except as otherwise set forth
above), and brokerage fees incurred in connection with the original construction
or development, or original or future leasing of the Project, and costs,
including permit, license and inspection costs, incurred with respect to the
installation of tenant improvements made for new tenants initially occupying
space in the Project after the Lease Commencement Date or incurred in renovating
or otherwise improving, decorating, painting or redecorating vacant space for
tenants or other occupants of the Project (excluding, however, such costs
relating to any common areas of the Project or parking facilities);

 

(b)                                 except as set forth in items (xii), (xiii),
and (xiv) above, depreciation, interest and principal payments on mortgages and
other debt costs, if any, penalties and interest, costs of capital repairs and
alterations, and costs of capital improvements and equipment;

 

(c)                                  costs for which the Landlord is reimbursed
by any tenant or occupant of the Project or by insurance by its carrier or any
tenant’s carrier or by anyone else, and electric power costs for which any
tenant directly contracts with the local public service company;

 

(d)                                 any bad debt loss, rent loss, or reserves
forbad debts or rent loss;

 

(e)                                  costs associated with the operation of the
business of the partnership or entity which constitutes the Landlord, as the
same are distinguished from the costs of operation of the Project (which shall
specifically include, but not be limited to, accounting costs associated with
the operation of the Project). Costs associated with the operation of the
business of the partnership or entity which constitutes the Landlord include
costs of partnership accounting and legal matters, costs of defending any
lawsuits with any mortgagee (except as the actions of the Tenant may be in
issue), costs of selling, syndicating, financing, mortgaging or hypothecating
any of the Landlord’s interest in the Project, and costs incurred in connection
with any disputes between Landlord and its employees, between Landlord and
Project management, or between Landlord and other tenants or occupants;

 

(f)                                   the wages and benefits of any employee who
does not devote substantially all of his or her employed time to the Project
unless such wages and benefits are prorated to reflect time spent on operating
and managing the Project vis-a-vis time spent on matters unrelated to operating
and managing the

 

7

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

 

Project; provided, that in no event shall Operating Expenses for purposes of
this Lease include wages and/or benefits attributable to personnel above the
level of Project manager;

 

(g)                                  amount paid as ground rental for the
Project by the Landlord;

 

(h)                                 except for a Project management fee to the
extent allowed pursuant to item (1), below, overhead and profit increment paid
to the Landlord or to subsidiaries or affiliates of the Landlord for services in
the Project to the extent the same exceeds the costs of such services rendered
by qualified, first-class unaffiliated third parties on a competitive basis;

 

(i)                                     any compensation paid to clerks,
attendants or other persons in commercial concessions operated by the Landlord,
provided that any compensation paid to any concierge at the Project shall be
includable as an Operating Expense;

 

(j)                                    rentals and other related expenses
incurred in leasing air conditioning systems, elevators or other equipment which
if purchased the cost of which would be excluded from Operating Expenses as a
capital cost, except equipment not affixed to the Project which is used in
providing janitorial or similar services and, further excepting from this
exclusion such equipment rented or leased to remedy or ameliorate an emergency
condition in the Project;

 

(k)                                 all items and services for which Tenant or
any other tenant in the Project reimburses Landlord or which Landlord provides
selectively to one or more tenants (other than Tenant) without reimbursement;

 

(l)                                     any costs expressly excluded from
Operating Expenses elsewhere in this Lease;

 

(m)                             rent for any office space occupied by Project
management personnel to the extent the size or rental rate of such office space
exceeds the size or fair market rental value of office space occupied by
management personnel of the comparable buildings in the vicinity of the
Building, with adjustment where appropriate for the size of the applicable
project;

 

(n)                                 costs arising from the gross negligence or
willful misconduct of Landlord or its agents, employees, vendors, contractors,
or providers of materials or services; and

 

(o)                                 costs incurred to comply with laws relating
to the removal of hazardous material (as defined under applicable law) which was
in existence in the Building or on the Project prior to the Lease Commencement
Date, and was of such a nature that a federal, State or municipal governmental
authority, if it had then had knowledge of the presence of such hazardous
material, in the state, and under the conditions that it then existed in the
Building or on the Project, would have then required the removal of such
hazardous material or other remedial or containment action with respect thereto;
and costs incurred to remove, remedy, contain, or treat hazardous material,
which hazardous material is brought into the Building or onto the Project after
the date hereof by Landlord or any other tenant of the Project and is of such a
nature, at that time, that a federal, State or municipal governmental authority,
if it had then had knowledge of the presence of such hazardous material, in the
state, and under the conditions, that it then exists in the Building or on the
Project, would have then required the removal of such hazardous material or
other remedial or containment action with respect thereto.

 

If Landlord is not furnishing any particular work or service (the cost of which,
if performed by Landlord, would be included in Operating Expenses) to a tenant
who has undertaken to perform such work or service in lieu of the performance
thereof by Landlord, Operating Expenses shall be deemed to be increased by an
amount equal to the additional Operating Expenses which would reasonably have
been incurred during such period by Landlord if it had at its own expense
furnished such work or service to such tenant. If the Project is not fully
occupied during all or a portion of the Base Year or any Expense Year, Landlord
shall make an appropriate adjustment to the components of Operating Expenses for
such year to determine the amount of Operating Expenses that would have been
incurred had the Project been fully occupied; and the amount so determined shall
be deemed to have been the amount of Operating Expenses for such year. Operating
Expenses for the Base Year shall not include market-wide cost increases due to
extraordinary

 

8

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

 

circumstances, including, but not limited to, “Force Majeure,” as that term is
defined in Section 29.16, below, boycotts, strikes, conservation surcharges,
embargoes or shortages, or amortized costs relating to capital improvements. In
no event shall the components of Direct Expenses for any Expense Year related to
Project insurance, security or utility costs be less than the components of
Direct Expenses related to Project insurance, security or utility costs,
respectively, in the Base Year.

 

4.2.5                     Taxes.

 

4.2.5.1           “Tax Expenses” shall mean all federal, state, county, or local
governmental or municipal taxes, fees, charges or other impositions of every
kind and nature, whether general, special, ordinary or extraordinary,
(including, without limitation, real estate taxes, general and special
assessments, transit taxes, leasehold taxes or taxes based upon the receipt of
rent, including gross receipts or sales taxes applicable to the receipt of rent,
unless required to be paid by Tenant, personal property taxes imposed upon the
fixtures, machinery, equipment, apparatus, systems and equipment, appurtenances,
furniture and other personal property used in connection with the Project, or
any portion thereof, and including estimated amounts based on pending but
uncompleted reassessments of the Project, as reasonably determined by Landlord),
which shall be paid or accrued during any Expense Year (without regard to any
different fiscal year used by such governmental or municipal authority) because
of or in connection with the ownership, leasing and operation of the Project, or
any portion thereof.

 

4.2.5.2           Tax Expenses shall include, without limitation: (i) Any tax on
the rent, right to rent or other income from the Project, or any portion
thereof, or as against the business of leasing the Project, or any portion
thereof; (ii) Any assessment, tax, fee, levy or charge in addition to, or in
substitution, partially or totally, of any assessment, tax, fee, levy or charge
previously included within the definition of real property tax, it being
acknowledged by Tenant and Landlord that Proposition 13 was adopted by the
voters of the State of California in the June 1978 election (“Proposition 13”)
and that assessments, taxes, fees, levies and charges may be imposed by
governmental agencies for such services as fire protection, street, sidewalk and
road maintenance, refuse removal and for other governmental services formerly
provided without charge to property owners or occupants, and, in further
recognition of the decrease in the level and quality of governmental services
and amenities as a result of Proposition 13, Tax Expenses shall also include any
governmental or private assessments or the Project’s contribution towards a
governmental or private cost-sharing agreement for the purpose of augmenting or
improving the quality of services and amenities normally provided by
governmental agencies; (iii) Any assessment, tax, fee, levy, or charge allocable
to or measured by the area of the Premises or the Rent payable hereunder,
including, without limitation, any business or gross income tax or excise tax
with respect to the receipt of such rent, or upon or with respect to the
possession, leasing, operating, management, maintenance, alteration, repair, use
or occupancy by Tenant of the Premises, or any portion thereof; and (iv) Any
assessment, tax, fee, levy or charge, upon this transaction or any document to
which Tenant is a party, creating or transferring an interest or an estate in
the Premises.

 

4.2.5.3           Any costs and expenses (including, without limitation,
reasonable attorneys’ and consultants’ fees) incurred in attempting to protest,
reduce or minimize Tax Expenses shall be included in Tax Expenses in the Expense
Year such expenses are incurred. Tax refunds shall be credited against Tax
Expenses and refunded to Tenant regardless of when received, based on the
Expense Year to which the refund is applicable, provided that in no event shall
the amount to be refunded to Tenant for any such Expense Year exceed the total
amount paid by Tenant as Additional Rent under this Article 4 for such Expense
Year. If Tax Expenses for any period during the Lease Term or any extension
thereof are increased after payment thereof for any reason, including, without
limitation, error or reassessment by applicable governmental or municipal
authorities, Tenant shall pay Landlord upon demand Tenant’s Share of any such
increased Tax Expenses. Notwithstanding anything to the contrary contained in
this Section 4.2.8 (except as set forth in Section 4.2.8.1, above), there shall
be excluded from Tax Expenses (i) all excess profits taxes, franchise taxes,
gift taxes, capital stock taxes, inheritance and succession taxes, estate taxes,
federal and state income taxes, and other taxes to the extent applicable to
Landlord’s general or net income (as opposed to rents, receipts or income
attributable to operations at the Project), (ii) any items included as Operating
Expenses, and (iii) any items paid by Tenant under Section 4.5 of this Lease.

 

4.2.5.4           The amount of Tax Expenses for the Base Year attributable to
the valuation of the Project, inclusive of tenant improvements, shall be known
as the “Base Taxes”. If in any comparison year subsequent to the Base Year, the
amount of Tax Expenses decreases below the amount of Base Taxes, then for
purposes of all

 

9

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

 

subsequent comparison years, including the comparison year in which such
decrease in Tax Expenses occurred, the Base Taxes, and therefore the Base Year,
shall be decreased by an amount equal to the decrease in Tax Expenses.

 

4.2.6                     “Tenant’s Share” shall mean the percentage set forth
in Section 6 of the Summary.

 

4.3                               Cost PooI. Landlord shall have the right, from
time to time, to equitably allocate some or all of the Direct Expenses for the
Project among different portions or occupants of the Project (the “Cost Pools”),
in Landlord’s reasonable discretion. Such Cost Pools may include, but shall not
be limited to, the office space tenants of a building of the Project or of the
Project, and the retail space tenants of a building of the Project or of the
Project. The Direct Expenses within each such Cost Pool shall be allocated and
charged to the tenants within such Cost Pool in an equitable manner.

 

4.4                               CaIcuIation and Payment of Additional Rent. If
for any Expense Year ending or commencing within the Lease Term, Tenant’s Share
of Direct Expenses for such Expense Year exceeds Tenant’s Share of Direct
Expenses applicable to the Base Year, then Tenant shall pay to Landlord, in the
manner set forth in Section 4.4.1, below, and as Additional Rent, an amount
equal to the excess (the “Excess”).

 

4.4.1                     Statement of ActuaI Direct Expenses and Payment by
Tenant. Landlord shall endeavor to give to Tenant following the end of each
Expense Year, a statement (the “Statement”) which shall state the Direct
Expenses incurred or accrued for such preceding Expense Year, and which shall
indicate the amount of the Excess. Upon receipt of the Statement for each
Expense Year commencing or ending during the Lease Term, if an Excess is
present, Tenant shall pay, with its next installment of Base Rent due, the full
amount of the Excess for such Expense Year, less the amounts, if any, paid
during such Expense Year as “Estimated Excess,” as that term is defined in
Section 4.4.2, below, and if Tenant paid more as Estimated Excess than the
actual Excess, Tenant shall receive a credit in the amount of Tenant’s
overpayment against Rent next due under this Lease. The failure of Landlord to
timely furnish the Statement for any Expense Year shall not prejudice Landlord
or Tenant from enforcing its rights under this Article 4. Even though the Lease
Term has expired and Tenant has vacated the Premises, when the final
determination is made of Tenant’s Share of Direct Expenses for the Expense Year
in which this Lease terminates, if an Excess if present, Tenant shall
immediately pay to Landlord such amount, and if Tenant paid more as Estimated
Excess than the actual Excess, Landlord shall, within thirty (30) days, deliver
a check payable to Tenant in the amount of the overpayment. The provisions of
this Section 4.4.1 shall survive the expiration or earlier termination of the
Lease Term.

 

4.4.2                     Statement of Estimated Direct Expenses. In addition,
Landlord shall endeavor to give Tenant a yearly expense estimate statement (the
“Estimate Statement”) which shall set forth Landlord’s reasonable estimate (the
“Estimate”) of what the total amount of Direct Expenses for the then-current
Expense Year shall be and the estimated excess (the “Estimated Excess”) as
calculated by comparing the Direct Expenses for such Expense Year, which shall
be based upon the Estimate, to the amount of Direct Expenses for the Base Year.
The failure of Landlord to timely furnish the Estimate Statement for any Expense
Year shall not preclude Landlord from enforcing its rights to collect any
Estimated Excess under this Article 4, nor shall Landlord be prohibited from
revising any Estimate Statement or Estimated Excess theretofore delivered to the
extent necessary. Thereafter, Tenant shall pay, with its next installment of
Base Rent due, a fraction of the Estimated Excess for the then-current Expense
Year (reduced by any amounts paid pursuant to the last sentence of this
Section 4.4.2). Such fraction shall have as its numerator the number of months
which have elapsed in such current Expense Year, including the month of such
payment, and twelve (12) as its denominator. Until a new Estimate Statement is
furnished (which Landlord shall have the right to deliver to Tenant at any
time), Tenant shall pay monthly, with the monthly Base Rent installments, an
amount equal to one-twelfth (1/12) of the total Estimated Excess set forth in
the previous Estimate Statement delivered by Landlord to Tenant.

 

4.5                               Taxes and Other Charges for which Tenant Is
Directly ResponsibIe.

 

4.5.1                     Tenant shall be liable for and shall pay ten (10) days
before delinquency, taxes levied against Tenant’s equipment, furniture, fixtures
and any other personal property located in or about the Premises. If any such
taxes on Tenant’s equipment, furniture, fixtures and any other personal property
are levied against Landlord or Landlord’s property or if the assessed value of
Landlord’s property is increased by the inclusion therein of a value placed upon
such equipment, furniture, fixtures or any other personal property and if
Landlord pays the taxes based upon such increased assessment, which Landlord
shall have the right to do regardless of the validity thereof but only under
proper protest if

 

10

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

 

requested by Tenant, Tenant shall upon demand repay to Landlord the taxes so
levied against Landlord or the proportion of such taxes resulting from such
increase in the assessment, as the case may be.

 

4.5.2                     If the tenant improvements in the Premises, whether
installed and/or paid for by Landlord or Tenant and whether or not affixed to
the real property so as to become a part thereof are assessed for real property
tax purposes at a valuation higher than the valuation at which tenant
improvements conforming to Landlord’s “building standard” in other space in the
Building are assessed, then the Tax Expenses levied against Landlord or the
property by reason of such excess assessed valuation shall be deemed to be taxes
levied against personal property of Tenant and shall be governed by the
provisions of Section 4.5.1, above.

 

4.5.3                     Notwithstanding any contrary provision herein, Tenant
shall pay prior to delinquency any (i) rent tax or sales tax, service tax,
transfer tax or value added tax, or any other applicable tax on the rent or
services herein or otherwise respecting this Lease, (ii) taxes assessed upon or
with respect to the possession, leasing, operation, management, maintenance,
alteration, repair, use or occupancy by Tenant of the Premises or any portion of
the Project, including the Project parking facility; or (iii) taxes assessed
upon this transaction or any document to which Tenant is a party creating or
transferring an interest or an estate in the Premises.

 

ARTICLE 5

 

USE OF PREMISES

 

5.1                               Permitted Use. Tenant shall use the Premises
solely for the Permitted Use set forth in Section 7 of the Summary and Tenant
shall not use or permit the Premises or the Project to be used for any other
purpose or purposes whatsoever without the prior written consent of Landlord,
which may be withheld in Landlord’s sole discretion.

 

5.2                               Prohibited Uses. Tenant further covenants and
agrees that Tenant shall not use, or suffer or permit any person or persons to
use, the Premises or any part thereof for any use or purpose contrary to the
provisions of the Rules and Regulations set forth in Exhibit D, attached hereto,
or in violation of the laws of the United States of America, the State of
California, the ordinances, regulations or requirements of the local municipal
or county governing body or other lawful authorities having jurisdiction over
the Project) including, without limitation, any such laws, ordinances.
regulations or requirements relating to hazardous materials or substances, as
those terms are defined by applicable laws now or hereafter in effect, or any
Underlying Documents. Tenant shall not do or permit anything to be done in or
about the Premises which will in any way damage the reputation of the Project or
obstruct or interfere with the rights of other tenants or occupants of the
Building, or injure or annoy them or use or allow the Premises to be used for
any improper, unlawful or objectionable purpose, nor shall Tenant cause,
maintain or permit any nuisance in, on or about the Premises. Tenant shall
comply with, and Tenant’s rights and obligations under the Lease and Tenant’s
use of the Premises shall be subject and subordinate to, all recorded easements,
covenants, conditions, and restrictions now or hereafter affecting the Project.

 

ARTICLE 6

 

SERVICES AND UTILITIES

 

6.1                               Standard Tenant Services. Landlord shall
provide the following services on all days (unless otherwise stated below)
during the Lease Term.

 

6.1.1                     Subject to limitations imposed by all governmental
rules, regulations and guidelines applicable thereto, Landlord shall provide
heating and air conditioning (“HVAC”) when necessary for normal comfort for
normal office use in the Premises from 8:00 A.M. to 6:00 P.M. Monday through
Friday (the “Building Hours”), except for the date of observation of New Year’s
Day, Independence Day, Labor Day, Memorial Day, Thanksgiving Day, Christmas Day
and, at Landlord’s discretion, other locally or nationally recognized holidays
which are observed by other buildings comparable to and in the vicinity of the
Building (collectively, the “Holidays”).

 

6.1.2                     Landlord shall provide adequate electrical service
capacity to the Premises for Tenant’s lighting fixtures and incidental use
equipment, provided that (i) the connected electrical load of the incidental use

 

11

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

 

equipment does not exceed an average of two (2) watts per rentable square foot
of the Premises during Building Hours, calculated on a monthly basis, and the
electricity so furnished for incidental use equipment will be at a nominal one
hundred twenty (120) volts and no electrical circuit for the supply of such
incidental use equipment will require a current capacity exceeding twenty (20)
amperes, and (ii) the connected electrical load of Tenant’s lighting fixtures
does not exceed an average of one (1) watt per rentable square foot of the
Premises during Building Hours, calculated on a monthly basis, and the
electricity so furnished for Tenant’s lighting will be at a nominal two hundred
seventy-seven (277) volts, which electrical usage shall be subject to applicable
laws and regulations, including Title 24. Subject to the foregoing limitations
regarding the electrical service capacity to be provided by Landlord, Landlord
shall only provide electricity for Tenant’s lighting fixtures during the
Building Hours, excluding Holidays. Tenant shall bear the cost of replacement of
lamps, starters and ballasts for non-Building standard lighting fixtures within
the Premises.

 

6.1.3                     Landlord shall provide city water from the regular
Building outlets for drinking, lavatory and toilet purposes in the Building
Common Areas.

 

6.1.4                     Landlord shall provide janitorial services to the
Premises, except on weekends and on the date of observation of the Holidays, in
and about the Premises and window washing services in a manner consistent with
other comparable buildings in the vicinity of the Building.

 

6.1.5                     Landlord shall provide nonexclusive, non-attended
automatic passenger elevator service during the Building Hours, shall have one
elevator available at all other times, including on the Holidays, and shall
provide nonexclusive, non-attended automatic passenger escalator service during
Building Hours only.

 

6.1.6                     Landlord shall provide nonexclusive freight elevator
service subject to scheduling by Landlord.

 

Tenant shall cooperate fully with Landlord at all times and abide by all
regulations and requirements that Landlord may reasonably prescribe for the
proper functioning and protection of the HVAC, electrical, mechanical and
plumbing systems.

 

6.2                               Overstandard Tenant Use. Tenant shall not,
without Landlord’s prior written consent, use heat-generating machines, machines
other than normal fractional horsepower office machines, or equipment or
lighting other than Building standard lights in the Premises, which may affect
the temperature otherwise maintained by the air conditioning system or increase
the water normally furnished for the Premises by Landlord pursuant to the terms
of Section 6.1 of this Lease. If Tenant uses water, electricity, heat or air
conditioning in excess of that supplied by Landlord pursuant to Section 6.1 of
this Lease, Tenant shall pay to Landlord, upon billing, the actual cost of such
excess consumption, the cost of the installation, operation, and maintenance of
equipment which is installed in order to supply such excess consumption, and the
cost of the increased wear and tear on existing equipment caused by such excess
consumption; and Landlord may install devices to separately meter any increased
use and in such event Tenant shall pay the increased cost directly to Landlord,
on demand, at the rates charged by the public utility company furnishing the
same, including the cost of installing, testing and maintaining of such
additional metering devices. Tenant’s use of electricity shall never exceed the
capacity of the feeders to the Project or the risers or wiring installation, and
subject to the terms of Section 29.31, below, Tenant shall not install or use or
permit the installation or use of any computer or electronic data processing
equipment in the Premises, without the prior written consent of Landlord. If
Tenant desires to use heat, ventilation or air conditioning during hours other
than those for which Landlord is obligated to supply such utilities pursuant to
the terms of Section 6.1 of this Lease, Tenant shall give Landlord such prior
notice, if any, as Landlord shall from time to time establish as appropriate, of
Tenant’s desired use in order to supply such utilities, and Landlord shall
supply such utilities to Tenant at such hourly cost per zone to Tenant (which
shall be treated as Additional Rent) as Landlord shall from time to time
establish. As of the date of this Lease, the current cost of after-hours
ventilation for fan only is $30.00 per hour and the current cost for after-hours
air conditioning is $130.00 per hour. Notwithstanding any provision to the
contrary contained in this Lease, Tenant shall promptly pay to Landlord,
Landlord’s standard charge for any services provided to Tenant which Landlord is
not specifically obligated to provide to Tenant pursuant to the terms of this
Lease.

 

6.3                               Interruption of Use. Tenant agrees that
Landlord shall not be liable for damages, by abatement of Rent (except as
specifically set forth in Section 6.4 of this Lease, below) or otherwise, for
failure to furnish or delay in furnishing any service (including telephone and
telecommunication services), or for any diminution in the quality or

 

12

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

 

quantity thereof, when such failure or delay or diminution is occasioned, in
whole or in part, by breakage, repairs, replacements, or improvements, by any
strike, lockout or other labor trouble, by inability to secure electricity, gas,
water, or other fuel at the Building or Project after reasonable effort to do
so, by any riot or other dangerous condition, emergency, accident or casualty
whatsoever, by act or default of Tenant or other parties, or by any other cause
beyond Landlord’s reasonable control; and such failures or delays or diminution
shall never be deemed to constitute an eviction or disturbance of Tenant’s use
and possession of the Premises or relieve Tenant from paying Rent (except as
specifically set forth in Section 6.4 of this Lease, below) or performing any of
its obligations under this Lease. Furthermore, Landlord shall not be liable
under any circumstances for a loss of, or injury to, property or for injury to,
or interference with, Tenant’s business, including, without limitation, loss of
profits, however occurring, through or in connection with or incidental to a
failure to furnish any of the services or utilities as set forth in this
Article 6.

 

6.4                               Abatement of Rent. In the event that Tenant is
prevented from using, and does not use, the Premises or any portion thereof, as
a result of (i) any repair, maintenance or alteration performed by Landlord, or
which Landlord failed to perform, after the Lease Commencement Date and required
by this Lease, which substantially interferes with Tenant’s use of the Premises,
or (ii) any failure to provide services, utilities or access to the Premises as
required by this Lease (either such set of circumstances as set forth in items
(i) or (ii), above, to be known as an “Abatement Event”), then Tenant shall give
Landlord notice of such Abatement Event, and if such Abatement Event continues
for five (5) consecutive business days after Landlord’s receipt of any such
notice (the “Eligibility Period”) and either (A) Landlord does not diligently
commence and pursue to completion the remedy of such Abatement Event or
(B) Landlord receives proceeds from its rental interruption insurance which
covers such Abatement Event, then the Base Rent, Tenant’s Share of Direct
Expenses, and Tenant’s obligation to pay for parking (to the extent not utilized
by Tenant) shall be abated or reduced, as the case may be, after expiration of
the Eligibility Period for such time that Tenant continues to be so prevented
from using, and does not use for the normal conduct of Tenant’s business, the
Premises or a portion thereof, in the proportion that the rentable area of the
portion of the Premises that Tenant is prevented from using, and does not use,
bears to the total rentable area of the Premises; provided, however, in the
event that Tenant is prevented from using, and does not use, a portion of the
Premises for a period of time in excess of the Eligibility Period and the
remaining portion of the Premises is not sufficient to allow Tenant to
effectively conduct its business therein, and if Tenant does not conduct its
business from such remaining portion, then for such time after expiration of the
Eligibility Period during which Tenant is so prevented from effectively
conducting its business therein, the Base Rent and Tenant’s Share of Direct
Expenses for the entire Premises and Tenant’s obligation to pay for parking
shall be abated for such time as Tenant continues to be so prevented from using,
and does not use, the Premises. If, however, Tenant reoccupies any portion of
the Premises during such period, the Rent allocable to such reoccupied portion,
based on the proportion that the rentable area of such reoccupied portion of the
Premises bears to the total rentable area of the Premises, shall be payable by
Tenant from the date Tenant reoccupies such portion of the Premises. To the
extent an Abatement Event is caused by an event covered by Articles 11 or 13 of
this Lease, then Tenant’s right to abate rent shall be governed by the terms of
such Article 11 or 13, as applicable, and the Eligibility Period shall not be
applicable thereto. Such right to abate Base Rent and Tenant’s Share of Direct
Expenses shall be Tenant’s sole and exclusive remedy for rent abatement at law
or in equity for an Abatement Event. Except as provided in this Section 6.4,
nothing contained herein shall be interpreted to mean that Tenant is excused
from paying Rent due hereunder.

 

ARTICLE 7

 

REPAIRS

 

Tenant shall, at Tenant’s own expense, keep the Premises, including all
improvements, fixtures, furnishings, and systems and equipment therein
(including, without limitation, plumbing fixtures and equipment such as
dishwashers, garbage disposals, and insta-hot dispensers), and the floor or
floors of the Building on which the Premises are located, in good order, repair
and condition at all times during the Lease Term. In addition, Tenant shall, at
Tenant’s own expense, but under the supervision and subject to the prior
approval of Landlord, and within any reasonable period of time specified by
Landlord, promptly and adequately repair all damage to the Premises and replace
or repair all damaged, broken, or worn fixtures and appurtenances, except for
damage caused by ordinary wear and tear or beyond the reasonable control of
Tenant; provided however, that, at Landlord’s option, or if Tenant fails to make
such repairs, Landlord may, but need not, make such repairs and replacements,
and Tenant shall pay Landlord the cost thereof, including a percentage of the
cost thereof (to be uniformly established for the Building and/or the Project)
sufficient to reimburse Landlord for all overhead, general conditions, fees and
other costs or expenses arising from Landlord’s involvement with such repairs
and replacements forthwith upon being billed for same. Notwithstanding the
foregoing,

 

13

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

 

Landlord shall be responsible for repairs to the exterior walls, foundation and
roof of the Building, the structural portions of the floors of the Building, and
the base building systems and equipment of the Building, except to the extent
that such repairs are required due to the negligence or willful misconduct of
Tenant; provided, however, that if such repairs are due to the negligence or
willful misconduct of Tenant, Landlord shall nevertheless make such repairs at
Tenant’s expense, or, if covered by Landlord’s insurance, Tenant shall only be
obligated to pay any deductible in connection therewith. Landlord may, but shall
not be required to, enter the Premises at all reasonable times to make such
repairs, alterations, improvements or additions to the Premises or to the
Project or to any equipment located in the Project as Landlord shall desire or
deem necessary or as Landlord may be required to do by governmental or
quasi-governmental authority or court order or decree. Tenant hereby waives any
and all rights under and benefits of subsection 1 of Section 1932 and Sections
1941 and 1942 of the California Civil Code or under any similar law, statute, or
ordinance now or hereafter in effect.

 

ARTICLE 8

 

ADDITIONS AND ALTERATIONS

 

8.1                               Landlord’s Consent to Alterations. Tenant may
not make any improvements, alterations, additions or changes to the Premises
(including any work that may affect ACM in the Project or the Premises) or any
electrical, mechanical, plumbing or HVAC facilities or systems pertaining to the
Premises (collectively, the “Alterations”) without first procuring the prior
written consent of Landlord to such Alterations, which consent shall be
requested by Tenant not less than thirty (30) days prior to the commencement
thereof, and which consent shall not be unreasonably withheld by Landlord,
provided it shall be deemed reasonable for Landlord to withhold its consent to
any Alteration which adversely affects the structural portions or the systems or
equipment of the Building or is visible from the exterior of the Building.
Notwithstanding the foregoing, Tenant shall be permitted to make Alterations
following ten (10) business days notice to Landlord, but without Landlord’s
prior consent, to the extent that such Alterations are decorative only (i.e.,
installation of carpeting or painting of the Premises). The construction of the
initial improvements to the Premises shall be governed by the terms of the
Tenant Work Letter and not the terms of this Article 8.

 

8.2                               Manner of Construction. Landlord may impose,
as a condition of its consent to any and all Alterations or repairs of the
Premises or about the Premises, such requirements as Landlord in its reasonable
discretion may deem desirable, including, but not limited to, the requirement
that Tenant utilize for such purposes only contractors, subcontractors,
materials, mechanics and materialmen selected by Tenant from a list provided and
approved by Landlord, the requirement that upon Landlord’s request, Tenant
shall, at Tenant’s expense, remove such Alterations upon the expiration or any
early termination of the Lease Term. Tenant shall construct such Alterations and
perform such repairs in a good and workmanlike manner, in conformance with any
and all applicable federal, state, county or municipal laws, rules and
regulations and pursuant to a valid building permit, issued by the City of San
Francisco, all in conformance with Landlord’s construction rules and regulations
(including with respect to ACM); provided, however, that prior to commencing to
construct any Alteration, Tenant shall meet with Landlord to discuss Landlord’s
design parameters and code compliance issues (including with respect to ACM). In
the event Tenant performs any Alterations in the Premises which require or give
rise to governmentally required changes to the “Base Building,” as that term is
defined below, then Landlord shall, at Tenant’s expense, make such changes to
the Base Building. The “Base Building” shall include the structural portions of
the Building, and the public restrooms, elevators, exit stairwells and the
systems and equipment located in the internal core of the Building on the floor
or floors on which the Premises are located. In performing the work of any such
Alterations, Tenant shall have the work performed in such manner so as not to
obstruct access to the Project or any portion thereof, by any other tenant of
the Project, and so as not to obstruct the business of Landlord or other tenants
in the Project. Tenant shall not use (and upon notice from Landlord shall cease
using) contractors, services, workmen, labor, materials or equipment that, in
Landlord’s reasonable judgment, would disturb labor harmony with the workforce
or trades engaged in performing other work, labor or services in or about the
Building or the Common Areas. In addition to Tenant’s obligations under
Article 9 of this Lease, upon completion of any Alterations, Tenant agrees to
cause a Notice of Completion to be recorded in the office of the Recorder of the
County of San Francisco in accordance with Section 3093 of the Civil Code of the
State of California or any successor statute, and Tenant shall deliver to the
Project construction manager a reproducible copy of the “as built” drawings of
the Alterations as well as all permits, approvals and other documents issued by
any governmental agency in connection with the Alterations.

 

14

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

 

8.3                               Payment for Improvements. If payment is made
by Tenant directly to contractors, Tenant shall (i) comply with Landlord’s
requirements for final lien releases and waivers in connection with Tenant’s
payment for work to contractors, and (ii) sign Landlord’s standard contractor’s
rules and regulations. If Tenant orders any work directly from Landlord, Tenant
shall pay to Landlord an amount equal to five percent (5%) of the cost of such
work to compensate Landlord for all overhead, general conditions, fees and other
costs and expenses arising from Landlord’s involvement with such work. If Tenant
does not order any work directly from Landlord, Tenant shall reimburse Landlord
for Landlord’s reasonable, actual, out-of-pocket costs and expenses actually
incurred in connection with Landlord’s review of such work. At Landlord’s
option, prior to the commencement of construction of any Alteration, Tenant
shall provide Landlord with the reasonably anticipated cost thereof, which
Landlord shall disburse during construction pursuant to Landlord’s standard,
commercially reasonable disbursement procedure.

 

8.4                               Construction Insurance. In addition to the
requirements of Article 10 of this Lease, in the event that Tenant makes any
Alterations, prior to the commencement of such Alterations, Tenant shall provide
Landlord with evidence that Tenant carries “Builder’s All Risk” insurance in an
amount approved by Landlord covering the construction of such Alterations, and
such other insurance as Landlord may reasonably require, it being understood and
agreed that all of such Alterations shall be insured by Tenant pursuant to
Article 10 of this Lease immediately upon completion thereof. In addition,
Landlord may. in its discretion, require Tenant to obtain a lien and completion
bond or some alternate form of security satisfactory to Landlord in an amount
sufficient to ensure the lien-free completion of such Alterations and naming
Landlord as a co-obligee.

 

8.5                               Landlord’s Property. All Alterations,
improvements, fixtures, equipment and/or appurtenances which may be installed or
placed in or about the Premises, from time to time, shall be at the sole cost of
Tenant and shall be and become the property of Landlord, except that Tenant may
remove any Alterations, improvements, fixtures and/or equipment which Tenant can
substantiate to Landlord have not been paid for with any Tenant improvement
allowance funds provided to Tenant by Landlord, provided Tenant repairs any
damage to the Premises and Building caused by such removal and returns the
affected portion of the Premises to a building standard tenant improved
condition as determined by Landlord. Furthermore, Landlord may, by written
notice to Tenant given at the time of Landlord’s consent to the subject
Alterations and/or improvements and/or systems or equipment (if applicable),
require Tenant, at Tenant’s expense, to remove any Alterations and/or
improvements and/or systems and equipment within the Premises and to repair any
damage to the Premises and Building caused by such removal and return the
affected portion of the Premises to a building standard tenant improved
condition as determined by Landlord. Notwithstanding the foregoing or any
provision to the contrary set forth herein, in no event shall Tenant be required
to remove the Tenant Improvements from the Premises following the expiration or
earlier termination of this Lease. If Tenant fails to complete any required
removal and/or to repair any damage caused by the removal of any Alterations
and/or improvements and/or systems and equipment in the Premises and return the
affected portion of the Premises to a building standard tenant improved
condition as reasonably determined by Landlord, Landlord may do so and may
charge the cost thereof to Tenant. Tenant hereby protects, defends, indemnifies
and holds Landlord harmless from any liability, cost, obligation, expense or
claim of lien in any manner relating to the installation, placement, removal or
financing of any such Alterations, improvements, fixtures and/or equipment in,
on or about the Premises, which obligations of Tenant shall survive the
expiration or earlier termination of this Lease.

 

ARTICLE 9

 

COVENANT AGAINST LIENS

 

Tenant shall keep the Project and Premises free from any liens or encumbrances
arising out of the work performed, materials furnished or obligations incurred
by or on behalf of Tenant, and shall protect, defend, indemnify and hold
Landlord harmless from and against any claims, liabilities, judgments or costs
(including, without limitation, reasonable attorneys’ fees and costs) arising
out of same or in connection therewith. Tenant shall give Landlord notice at
least twenty (20) days prior to the commencement of any such work on the
Premises (or such additional time as may be necessary under applicable laws) to
afford Landlord the opportunity of posting and recording appropriate notices of
non-responsibility. Tenant shall remove any such lien or encumbrance by bond or
otherwise within ten (10) business days after notice by Landlord, and if Tenant
shall fail to do so, Landlord may pay the amount necessary to remove such lien
or encumbrance, without being responsible for investigating the validity
thereof. The amount so paid shall be deemed Additional Rent under this Lease
payable upon demand, without limitation as to other remedies available to
Landlord under this Lease. Nothing contained in this Lease shall authorize
Tenant to do any act which shall subject Landlord’s

 

15

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

 

title to the Building or Premises to any liens or encumbrances whether claimed
by operation of law or express or implied contract. Any claim to a lien or
encumbrance upon the Building or Premises arising in connection with any such
work or respecting the Premises not performed by or at the request of Landlord
shall be null and void, or at Landlord’s option shall attach only against
Tenant’s interest in the Premises and shall in all respects be subordinate to
Landlord’s title to the Project, Building and Premises.

 

ARTICLE 10

 

INSURANCE

 

10.1                        Indemnification and Waiver. Except to the extent
caused by the negligence or willful misconduct of Landlord or the “Landlord
Parties” as that term is defined, below, Tenant hereby assumes all risk of
damage to property or injury to persons in, upon or about the Premises from any
cause whatsoever (including, but not limited to, any personal injuries resulting
from a slip and fall in, upon or about the Premises) and agrees that Landlord,
its partners, subpartners and their respective officers, agents, servants,
employees, and independent contractors (collectively, “Landlord Parties”) shall
not be liable for, and are hereby released from any responsibility for, any
damage either to person or property or resulting from the loss of use thereof,
which damage is sustained by Tenant or by other persons claiming through Tenant.
Tenant shall indemnify, defend, protect, and hold harmless the Landlord Parties
from any and all loss, cost, damage, expense and liability (including without
limitation court costs and reasonable attorneys’ fees) incurred in connection
with or arising from any cause in, on or about the Premises (including, but not
limited to, a slip and fall), any acts, omissions or negligence of Tenant or of
any person claiming by, through or under Tenant, or of the contractors, agents,
servants, employees, invitees, guests or licensees of Tenant or any such person,
in, on or about the Project or any breach of the terms of this Lease, either
prior to, during, or after the expiration of the Lease Term, provided that the
terms of the foregoing indemnity shall not apply to the negligence or willful
misconduct of Landlord. Should Landlord be named as a defendant in any suit
brought against Tenant in connection with or arising out of Tenant’s occupancy
of the Premises, Tenant shall pay to Landlord its costs and expenses incurred in
such suit, including without limitation, its actual professional fees such as
reasonable appraisers’, accountants’ and attorneys’ fees. Landlord shall
indemnify, defend, protect, and hold harmless Tenant, its partners, and their
respective officers, agents, servants, employees, and independent contractors
(collectively, “Tenant Parties”) from any and all loss, cost, damage, expense
and liability (including, without limitation, reasonable attorneys’ fees)
arising from the negligence or willful misconduct of Landlord in, on or about
the Project, except to the extent caused by the negligence or willful misconduct
of the Tenant Parties. Notwithstanding anything to the contrary set forth in
this Lease, either party’s agreement to indemnify the other party as set forth
in this Section 10.1 shall be ineffective to the extent the matters for which
such party agreed to indemnify the other party are covered by insurance required
to be carried by the non-indemnifying party pursuant to this Lease. Further,
Tenant’s agreement to indemnify Landlord and Landlord’s agreement to indemnify
Tenant pursuant to this Section 10.1 are not intended to and shall not relieve
any insurance carrier of its obligations under policies required to be carried
pursuant to the provisions of this Lease, to the extent such policies cover, or
if carried, would have covered the matters, subject to the parties’ respective
indemnification obligations; nor shall they supersede any inconsistent agreement
of the parties set forth in any other provision of this Lease. The provisions of
this Section 10.1 shall survive the expiration or sooner termination of this
Lease with respect to any claims or liability arising in connection with any
event occurring prior to such expiration or termination.

 

10.2                        Tenant’s Compliance With Landlord’s Fire and
Casualty Insurance. Tenant shall, at Tenant’s expense, comply with all insurance
company requirements pertaining to the use of the Premises. If Tenant’s conduct
or use of the Premises causes any increase in the premium for such insurance
policies then Tenant shall reimburse Landlord for any such increase. Tenant, at
Tenant’s expense, shall comply with all rules, orders, regulations or
requirements of the American Insurance Association (formerly the National Board
of Fire Underwriters) and with any similar body.

 

16

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

 

10.3                        Tenant’s Insurance. Tenant shall maintain the
following coverages in the following amounts.

 

10.3.1              Commercial General Liability Insurance on an occurrence form
covering the insured against claims of bodily injury, personal injury and
property damage (including loss of use thereof) arising out of Tenant’s
operations, and contractual liabilities (covering the performance by Tenant of
its indemnity agreements) including products and completed operations coverage
and a Broad Form endorsement covering the insuring provisions of this Lease and
the performance by Tenant of the indemnity agreements set forth in Section 10.1
of this Lease, for limits of liability not less than:

 

Bodily Injury and

S2,000,000 each occurrence

Property Damage Liability

$4,000,000 annual aggregate

 

 

Personal Injury Liability

$2,000,000 each occurrence

 

$4,000,000 annual aggregate

 

0% Insured’s participation

 

Tenant shall have the right to maintain the liability insurance required
hereunder through any combination of primary general liability and “umbrella”
policies of insurance, provided that the policies contain aggregate per location
endorsements that provide the required levels of protection for the Premises and
that such polices comply with the terms hereof.

 

10.3.2              Physical Damage Insurance covering (i) all office furniture,
business and trade fixtures, office equipment, free-standing cabinet work,
movable partitions, merchandise and all other items of Tenant’s property on the
Premises installed by, for, or at the expense of Tenant, (ii) the “Tenant
Improvements,” as that term is defined in the Tenant Work Letter, and any other
improvements which exist in the Premises as of the Lease Commencement Date
(excluding the Base Building) (the “Original Improvements”), and (iii) all other
improvements, alterations and additions to the Premises. Such insurance shall be
written on an “all risks” of physical loss or damage basis, for the full
replacement cost value (subject to reasonable deductible amounts) new without
deduction for depreciation of the covered items and in amounts that meet any
co-insurance clauses of the policies of insurance and shall include coverage for
damage or other loss caused by fire or other peril including, but not limited
to, vandalism and malicious mischief, theft, water damage of any type, including
sprinkler leakage, bursting or stoppage of pipes, and explosion, and providing
business interruption coverage for a period of one year.

 

10.3.3              Worker’s Compensation and Employer’s Liability or other
similar insurance pursuant to all applicable state and local statutes and
regulations.

 

10.4                        Form of Policies. The minimum limits of policies of
insurance required of Tenant under this Lease shall in no event limit the
liability of Tenant under this Lease. Such insurance shall (i) name Landlord,
and any other party the Landlord so specifies, as an additional insured,
including Landlord’s managing agent, if any; (ii) specifically cover the
liability assumed by Tenant under this Lease, including, but not limited to,
Tenant’s obligations under Section 10.1 of this Lease; (iii) be issued by an
insurance company having a rating of not less than A-X in Best’s Insurance Guide
or which is otherwise acceptable to Landlord and licensed to do business in the
State of California; (iv) be primary insurance as to all claims thereunder and
provide that any insurance carried by Landlord is excess and is non-contributing
with any insurance requirement of Tenant; (v) be in form and content reasonably
acceptable to Landlord; and (vi) provide that said insurance shall not be
canceled or coverage changed unless thirty (30) days’ prior written notice shall
have been given to Landlord and any mortgagee of Landlord. Tenant shall deliver
said policy or policies or certificates thereof to Landlord on or before the
Lease Commencement Date and at least thirty (30) days before the expiration
dates thereof. In the event Tenant shall fail to procure such insurance, or to
deliver such policies or certificate, Landlord may, at its option, procure such
policies for the account of Tenant, and the cost thereof shall be paid to Land
lord within five (5) days after delivery to Tenant of bills therefor.

 

10.5                        Subrogation. Landlord and Tenant intend that their
respective property loss risks shall be borne by reasonable insurance carriers
to the extent above provided, and Landlord and Tenant hereby agree to look
solely to, and seek recovery only from, their respective insurance carriers in
the event of a property loss to the extent that such coverage is agreed to be
provided hereunder. The parties each hereby waive all rights and claims against
each other for such losses, and waive all rights of subrogation of their
respective insurers, provided such waiver of subrogation shall not

 

17

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

 

affect the right to the insured to recover thereunder. The parties agree that
their respective insurance policies are now, or shall be, endorsed such that the
waiver of subrogation shall not affect the right of the insured to recover
thereunder, so long as no material additional premium is charged therefor.

 

10.6                        Additional Insurance Obligations. Tenant shall carry
and maintain during the entire Lease Term, at Tenant’s sole cost and expense,
increased amounts of the insurance required to be carried by Tenant pursuant to
this Article 10 and such other reasonable types of insurance coverage and in
such reasonable amounts covering the Premises and Tenant’s operations therein,
as may be reasonably requested by Landlord, but in no event in excess of the
amounts and types of insurance then being required by landlords of buildings
comparable to and in the vicinity of the Building.

 

ARTICLE 11

 

DAMAGE AND DESTRUCTION

 

11.1                        Repair of Damage to Premises by Landlord. Tenant
shall promptly notify Landlord of any damage to the Premises resulting from fire
or any other casualty. If the Premises or any Common Areas serving or providing
access to the Premises shall be damaged by fire or other casualty, Landlord
shall promptly and diligently, subject to reasonable delays for insurance
adjustment or other matters beyond Landlord’s reasonable control, and subject to
all other terms of this Article 11, restore the Base Building and such Common
Areas. Such restoration shall be to substantially the same condition of the Base
Building and the Common Areas prior to the casualty, except for modifications
required by zoning and building codes and other laws or by the holder of a
mortgage on the Building or Project or any other modifications to the Common
Areas deemed desirable by Landlord, which are consistent with the character of
the Project, provided that access to the Premises and any common restrooms
serving the Premises shall not be materially impaired. Upon the occurrence of
any damage to the Premises, upon notice (the “Landlord Repair Notice”) to Tenant
from Landlord, Tenant shall assign to Landlord (or to any party designated by
Landlord) all insurance proceeds payable to Tenant under Tenant’s insurance
required under Section 10.3 of this Lease, and Landlord shall repair any injury
or damage to the Tenant Improvements and the Original Improvements installed in
the Premises and shall return such Tenant Improvements and Original Improvements
to their original condition; provided that if the cost of such repair by
Landlord exceeds the amount of insurance proceeds received by Landlord from
Tenant’s insurance carrier, as assigned by Tenant, the cost of such repairs
shall be paid by Tenant to Landlord prior to Landlord’s commencement of repair
of the damage. In the event that Landlord does not deliver the Landlord Repair
Notice within sixty (60) days following the date the casualty becomes known to
Landlord, Tenant shall, at its sole cost and expense, repair any injury or
damage to the Tenant Improvements and the Original Improvements installed in the
Premises and shall return such Tenant Improvements and Original Improvements to
their original condition. Whether or not Landlord delivers a Landlord Repair
Notice, prior to the commencement of construction, Tenant shall submit to
Landlord, for Landlord’s review and approval, all plans, specifications and
working drawings relating thereto, and Landlord shall select the contractors to
perform such improvement work. Landlord shall not be liable for any
inconvenience or annoyance to Tenant or its visitors, or injury to Tenant’s
business resulting in any way from such damage or the repair thereof; provided
however, that if such fire or other casualty shall have damaged the Premises or
Common Areas necessary to Tenant’s access to or Tenant’s occupancy of the
Premises, and the Premises are not occupied by Tenant as a result thereof, then
during the time and to the extent the Premises are unfit for occupancy (or
cannot be accessed by Tenant), the Rent shall be abated in proportion to the
ratio that the amount of rentable square feet of the Premises which is unfit for
occupancy (or cannot be accessed by Tenant) for the purposes permitted under
this Lease bears to the total rentable square feet of the Premises. In the event
that Landlord shall not deliver the Landlord Repair Notice, Tenant’s right to
rent abatement pursuant to the preceding sentence shall terminate as of the date
which is reasonably determined by Landlord to be the date Tenant should have
completed repairs to the Premises assuming Tenant used reasonable due diligence
in connection therewith.

 

11.2                        Landlord’s Option to Repair. Notwithstanding the
terms of Section 11.1 of this Lease, Landlord may elect not to rebuild and/or
restore the Premises, Building and/or Project, and instead terminate this Lease,
by notifying Tenant in writing of such termination within sixty (60) days after
the date of discovery of the damage, such notice to include a termination date
giving Tenant sixty (60) days to vacate the Premises, but Landlord may so elect
only if the Building or Project shall be damaged by fire or other casualty or
cause, whether or not the Premises are affected, and one or more of the
following conditions is present: (i) in Landlord’s reasonable judgment, repairs
cannot reasonably be completed within one hundred eighty (180) days after the
date of discovery of the damage (when such repairs are made without the payment
of overtime or other premiums); (ii) the holder of any mortgage on the Building
or Project or

 

18

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

 

ground lessor with respect to the Building or Project shall require that the
insurance proceeds or any portion thereof be used to retire the mortgage debt,
or shall terminate the ground lease, as the case may be; (iii) the damage is not
fully covered by Landlord’s insurance policies; (iv) Landlord decides to rebuild
the Building or Common Areas so that they will be substantially different
structurally or architecturally; (v) the damage occurs during the last twelve
(12) months of the Lease Term; or (vi) any owner of any other portion of the
Project, other than Landlord, does not intend to repair the damage to such
portion of the Project; provided, however, that if Landlord does not elect to
terminate this Lease pursuant to Landlord’s termination right as provided above,
and the repairs cannot, in the reasonable opinion of Landlord, be completed
within one hundred eighty (180) days after being commenced, Tenant may elect, no
earlier than sixty (60) days after the date of the damage and not later than
ninety (90) days after the date of such damage, to terminate this Lease by
written notice to Landlord effective as of the date specified in the notice,
which date shall not be less than thirty (30) days nor more than sixty (60) days
after the date such notice is given by Tenant.

 

11.3                        Waiver of Statutory Provisions. The provisions of
this Lease, including this Article 11, constitute an express agreement between
Landlord and Tenant with respect to any and all damage to, or destruction of,
all or any part of the Premises, the Building or the Project, and any statute or
regulation of the State of California, including, without limitation, Sections
1932(2) and 1933(4) of the California Civil Code, with respect to any rights or
obligations concerning damage or destruction in the absence of an express
agreement between the parties, and any other statute or regulation, now or
hereafter in effect, shall have no application to this Lease or any damage or
destruction to all or any part of the Premises, the Building or the Project.

 

ARTICLE 12

 

NONWAIVER

 

No provision of this Lease shall be deemed waived by either party hereto unless
expressly waived in a writing signed thereby. The waiver by either party hereto
of any breach of any term, covenant or condition herein contained shall not be
deemed to be a waiver of any subsequent breach of same or any other term,
covenant or condition herein contained. The subsequent acceptance of Rent
hereunder by Landlord shall not be deemed to be a waiver of any preceding breach
by Tenant of any term, covenant or condition of this Lease, other than the
failure of Tenant to pay the particular Rent so accepted, regardless of
Landlord’s knowledge of such preceding breach at the time of acceptance of such
Rent. No acceptance of a lesser amount than the Rent herein stipulated shall be
deemed a waiver of Landlord’s right to receive the full amount due, nor shall
any endorsement or statement on any check or payment or any letter accompanying
such check or payment be deemed an accord and satisfaction, and Landlord may
accept such check or payment without prejudice to Landlord’s right to recover
the full amount due. No receipt of monies by Landlord from Tenant after the
termination of this Lease shall in any way alter the length of the Lease Term or
of Tenant’s right of possession hereunder, or after the giving of any notice
shall reinstate, continue or extend the Lease Term or affect any notice given
Tenant prior to the receipt of such monies, it being agreed that after the
service of notice or the commencement of a suit, or after final judgment for
possession of the Premises, Landlord may receive and collect any Rent due, and
the payment of said Rent shall not waive or affect said notice, suit or
judgment.

 

ARTICLE 13

 

CONDEMNATION

 

If the whole or any part of the Premises, Building or Project shall be taken by
power of eminent domain or condemned by any competent authority for any public
or quasi-public use or purpose, or if any adjacent property or street shall be
so taken or condemned, or reconfigured or vacated by such authority in such
manner as to require the use, reconstruction or remodeling of any part of the
Premises, Building or Project, or if Landlord shall grant a deed or other
instrument in lieu of such taking by eminent domain or condemnation, Landlord
shall have the option to terminate this Lease effective as of the date
possession is required to be surrendered to the authority. If more than
twenty-five percent (25%) of the rentable square feet of the Premises is taken,
or if access to the Premises is substantially impaired, in each case for a
period in excess of one hundred eighty (180) days, Tenant shall have the option
to terminate this Lease effective as of the date possession is required to be
surrendered to the authority. Tenant shall not because of such taking assert any
claim against Landlord or the authority for any compensation because of such
taking and Landlord shall be entitled to the entire award or payment in
connection therewith, except that Tenant shall have the right to file any
separate claim available to Tenant for any taking of Tenant’s personal property
and fixtures belonging to Tenant and

 

19

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

 

removable by Tenant upon expiration of the Lease Term pursuant to the terms of
this Lease, and for moving expenses, so long as such claims do not diminish the
award available to Landlord, its ground lessor with respect to the Building or
Project or its mortgagee, and such claim is payable separately to Tenant. All
Rent shall be apportioned as of the date of such termination. If any part of the
Premises shall be taken, and this Lease shall not be so terminated, the Rent
shall be proportionately abated. Tenant hereby waives any and all rights it
might otherwise have pursuant to Section 1265.130 of The California Code of
Civil Procedure. Notwithstanding anything to the contrary contained in this
Article 13, in the event of a temporary taking of all or any portion of the
Premises for a period of one hundred and eighty (180) days or less, then this
Lease shall not terminate but the Base Rent and the Additional Rent shall be
abated for the period of such taking in proportion to the ratio that the amount
of rentable square feet of the Premises taken bears to the total rentable square
feet of the Premises (the foregoing shall apply to any portion of the Premises
that cannot be accessed as a result of such taking). Landlord shall be entitled
to receive the entire award made in connection with any such temporary taking.

 

ARTICLE 14

 

ASSIGNMENT AND SUBLETTING

 

14.1                        Transfers. Tenant shall not, without the prior
written consent of Landlord, assign, mortgage, pledge, hypothecate, encumber, or
permit any lien to attach to, or otherwise transfer, this Lease or any interest
hereunder, permit any assignment, or other transfer of this Lease or any
interest hereunder by operation of law, sublet the Premises or any part thereof,
or enter into any license or concession agreements or otherwise permit the
occupancy or use of the Premises or any part thereof by any persons other than
Tenant and its employees and contractors (all of the foregoing are hereinafter
sometimes referred to collectively as “Transfers” and any person to whom any
Transfer is made or sought to be made is hereinafter sometimes referred to as a
“Transferee”). If Tenant desires Landlord’s consent to any Transfer, Tenant
shall notify Landlord in writing, which notice (the “Transfer Notice”) shall
include (i) the proposed effective date of the Transfer, which shall not be less
than thirty (30) days nor more than one hundred eighty (180) days after the date
of delivery of the Transfer Notice, (ii) a description of the portion of the
Premises to be transferred (the “Subject Space”), (iii) all of the terms of the
proposed Transfer and the consideration therefor, including calculation of the
“Transfer Premium”, as that term is defined in Section 14.3 below, in connection
with such Transfer, the name and address of the proposed Transferee, and a copy
of all existing executed and/or proposed documentation pertaining to the
proposed Transfer, including all existing operative documents to be executed to
evidence such Transfer or the agreements incidental or related to such Transfer,
provided that Landlord shall have the right to require Tenant to utilize
Landlord’s standard Transfer documents in connection with the documentation of
such Transfer, (iv) current financial statements of the proposed Transferee
certified by an officer, partner or owner thereof, business credit and personal
references and history of the proposed Transferee and any other information
reasonably required by Landlord which will enable Land Lord to determine the
financial responsibility, character, and reputation of the proposed Transferee,
nature of such Transferee’s business and proposed use of the Subject Space, and
(v) an executed estoppel certificate from Tenant in the form attached hereto as
Exhibit E. Any Transfer made without Landlord’s prior written consent shall, at
Landlord’s option, be null, void and of no effect, and shall, at Landlord’s
option, constitute a default by Tenant under this Lease. Whether or not Landlord
consents to any proposed Transfer, Tenant shall pay Landlord’s reasonable review
and processing fees, as well as any reasonable professional fees (including,
without limitation, attorneys’, accountants’, architects’, engineers’ and
consultants’ fees) incurred by Landlord, within thirty (30) days after written
request by Landlord (provided that in the event that Landlord exercises its
right under Section 14.4, below, then Tenant shall not be obligated to pay any
such fees to Landlord).

 

14.2                        Landlord’s Consent. Landlord shall not unreasonably
withhold or delay its consent to any proposed Transfer of the Subject Space to
the Transferee on the terms specified in the Transfer Notice. Without limitation
as to other reasonable grounds for withholding consent, the parties hereby agree
that it shall be reasonable under this Lease and under any applicable law for
Landlord to withhold consent to any proposed Transfer where one or more of the
following apply:

 

14.2.1              The Transferee is of a character or reputation or engaged in
a business which is not consistent with the quality of the Building or the
Project;

 

14.2.2              The Transferee intends to use the Subject Space for purposes
which are not permitted under this Lease;

 

20

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

 

14.2.3              The Transferee is either a governmental agency or
instrumentality thereof;

 

14.2.4              The rent charged by Tenant to such Transferee during the
term of such Transfer, calculated using a present value analysis, is less than
ninety-five percent (95%) of the rent being quoted by Landlord at the time of
such Transfer for comparable space in the Project for a comparable term,
calculated using a present value analysis;

 

14.2.5              The Transferee is not a party of reasonable financial worth
and/or financial stability in light of the responsibilities to be undertaken in
connection with the Transfer on the date consent is requested;

 

14.2.6              The proposed Transfer would cause a violation of another
lease for space in the Project, or would give an occupant of the Project a right
to cancel its lease; or

 

14.2.7              Either the proposed Transferee, or any person or entity
which directly or indirectly, controls, is controlled by, or is under common
control with, the proposed Transferee, (i) occupies space in the Project at the
time of the request for consent, or (ii) is negotiating with Landlord or has
negotiated with Landlord during the six (6) month period immediately preceding
the date Landlord receives the Transfer Notice, to lease space in the Project.

 

If Landlord consents to any Transfer pursuant to the terms of this Section 14.2
(and does not exercise any recapture rights Landlord may have under Section 14.4
of this Lease), Tenant may within six (6) months after Landlord’s consent, but
not later than the expiration of said six-month period, enter into such Transfer
of the Premises or portion thereof, upon substantially the same terms and
conditions as are set forth in the Transfer Notice furnished by Tenant to
Landlord pursuant to Section 14.1 of this Lease, provided that if there are any
changes in the terms and conditions from those specified in the Transfer Notice
(i) such that Landlord would initially have been entitled to refuse its consent
to such Transfer under this Section 14.2, or (ii) which would cause the proposed
Transfer to be more favorable to the Transferee than the terms set forth in
Tenant’s original Transfer Notice, Tenant shall again submit the Transfer to
Landlord for its approval and other action under this Article 14 (including
Landlord’s right of recapture, if any, under Section 14.4 of this Lease).
Notwithstanding anything to the contrary in this Lease, if Tenant or any
proposed Transferee claims that Landlord has unreasonably withheld or delayed
its consent under Section 14.2 or otherwise has breached or acted unreasonably
under this Article 14, their sole remedies shall be a suit for contract damages
(other than damages for injury to, or interference with, Tenant’s business
including, without limitation, loss of profits, however occurring) or
declaratory judgment and an injunction for the relief sought, and Tenant hereby
waives all other remedies, including, without limitation, any right at law or
equity to terminate this Lease, on its own behalf and, to the extent permitted
under all applicable laws, on behalf of the proposed Transferee.

 

14.3                        Transfer Premium. If Landlord consents to a
Transfer, as a condition thereto which the parties hereby agree is reasonable,
Tenant shall pay to Landlord fifty percent (50%) of any “Transfer Premium,” as
that term is defined in this Section 14.3, received by Tenant from such
Transferee. “Transfer Premium” shall mean all rent, additional rent or other
consideration payable by such Transferee in connection with the Transfer in
excess of the Rent and Additional Rent payable by Tenant under this Lease during
the term of the Transfer on a per rentable square foot basis if less than all of
the Premises is transferred. “Transfer Premium” shall also include, but not be
limited to, key money, bonus money or other cash consideration paid by
Transferee to Tenant in connection with such Transfer, and any payment in excess
of fair market value for services rendered by Tenant to Transferee or for
assets, fixtures, inventory, equipment, or furniture transferred by Tenant to
Transferee in connection with such Transfer. The determination of the amount of
Landlord’s applicable share of the Transfer Premium shall be made on a monthly
basis as rent or other consideration is received by Tenant under the Transfer.

 

14.4                        Landlord’s Option as to Subject Space.
Notwithstanding anything to the contrary contained in this Article 14, in the
event Tenant contemplates a Transfer of all or a portion of the Premises, Tenant
shall give Landlord notice (the “Intention to Transfer Notice”) of such
contemplated Transfer (whether or not the contemplated Transferee or the terms
of such contemplated Transfer have been determined). The Intention to Transfer
Notice shall specify the portion of and amount of rentable square feet of the
Premises which Tenant intends to Transfer (the “Contemplated Transfer Space”),
the contemplated date of commencement of the Contemplated Transfer (the
“Contemplated Effective Date”), and the contemplated length of the term of such
contemplated Transfer, and shall specify that such Intention to Transfer Notice
is delivered to Landlord pursuant to this Section 14.4 in order to allow
Landlord to elect to recapture the Contemplated Transfer Space. Thereafter,
Landlord shall have the option, by giving written notice to Tenant within thirty
(30) days after receipt of any Intention to Transfer Notice, to recapture the
Contemplated Transfer

 

21

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

 

Space. Such recapture shall cancel and terminate this Lease with respect to such
Contemplated Transfer Space as of the Contemplated Effective Date. In the event
of a recapture by Landlord, if this Lease shall be canceled with respect to less
than the entire Premises, the Rent reserved herein shall be prorated on the
basis of the number of rentable square feet retained by Tenant in proportion to
the number of rentable square feet contained in the Premises, and this Lease as
so amended shall continue thereafter in full force and effect, and upon request
of either party, the parties shall execute written confirmation of the same. If
Landlord declines, or fails to elect in a timely manner, to recapture such
Contemplated Transfer Space under this Section 14.4, then, subject to the other
terms of this Article 14, for a period of six (6) months (the “Six Month
Period”) commencing on the last day of such thirty (30) day period, Landlord
shall not have any right to recapture the Contemplated Transfer Space with
respect to any Transfer made during the Six Month Period, provided that any such
Transfer is substantially on the terms set forth in the Intention to Transfer
Notice, and provided further that any such Transfer shall be subject to the
remaining terms of this Article 14. If such a Transfer is not so consummated
within the Six Month Period (or if a Transfer is so consummated, then upon the
expiration of the term of any Transfer of such Contemplated Transfer Space
consummated within such Six Month Period), Tenant shall again be required to
submit a new Intention to Transfer Notice to Landlord with respect any
contemplated Transfer, as provided above in this Section 14.4.

 

14.5                        Effect of Transfer. If Landlord consents to a
Transfer, (i) the terms and conditions of this Lease shall in no way be deemed
to have been waived or modified, (ii) such consent shall not be deemed consent
to any further Transfer by either Tenant or a Transferee, (iii) Tenant shall
deliver to Landlord, promptly after execution, an original executed copy of all
documentation pertaining to the Transfer in form reasonably acceptable to
Landlord, (iv) Tenant shall furnish upon Landlord’s request a complete
statement, certified by an independent certified public accountant, or Tenant’s
chief financial officer, setting forth in detail the computation of any Transfer
Premium Tenant has derived and shall derive from such Transfer, and (v) no
Transfer relating to this Lease or agreement entered into with respect thereto,
whether with or without Landlord’s consent, shall relieve Tenant or any
guarantor of the Lease from any liability under this Lease, including, without
limitation, in connection with the Subject Space. Landlord or its authorized
representatives shall have the right at all reasonable times to audit the books,
records and papers of Tenant relating to any Transfer, and shall have the right
to make copies thereof. If the Transfer Premium respecting any Transfer shall be
found understated, Tenant shall, within thirty (30) days after demand, pay the
deficiency, and if understated by more than two percent (2%), Tenant shall pay
Landlord’s costs of such audit.

 

14.6                        Additional Transfers. For purposes of this Lease,
the term “Transfer” shall also include (i) if Tenant is a partnership, the
withdrawal or change, voluntary, involuntary or by operation of law, of fifty
percent (50%) or more of the partners, or transfer of fifty percent (50%) or
more of partnership interests, within a twelve (12)-month period, or the
dissolution of the partnership without immediate reconstitution thereof, and
(ii) if Tenant is a closely held corporation (i.e., whose stock is not publicly
held and not traded through an exchange or over the counter), (A) the
dissolution, merger, consolidation or other reorganization of Tenant or (B) the
sale or other transfer of an aggregate of fifty percent (50%) or more of the
voting shares of Tenant (other than to immediate family members by reason of
gift or death), within a twelve (12)-month period, or (C) the sale, mortgage,
hypothecation or pledge of an aggregate of fifty percent (50%) or more of the
value of the unencumbered assets of Tenant within a twelve (12)-month period.

 

14.7                        Occurrence of Default. Any Transfer hereunder shall
be subordinate and subject to the provisions of this Lease, and if this Lease
shall be terminated during the term of any Transfer, Landlord shall have the
right to: (i) treat such Transfer as cancelled and repossess the Subject Space
by any lawful means, or (ii) require that such Transferee attorn to and
recognize Landlord as its landlord under any such Transfer. If Tenant shall be
in default under this Lease, Landlord is hereby irrevocably authorized, as
Tenant’s agent and attorney-in-fact, to direct any Transferee to make all
payments under or in connection with the Transfer directly to Landlord (which
Landlord shall apply towards Tenant’s obligations under this Lease) until such
default is cured. Such Transferee shall rely on any representation by Landlord
that Tenant is in default hereunder, without any need for confirmation thereof
by Tenant. Upon any assignment, the assignee shall assume in writing all
obligations and covenants of Tenant thereafter to be performed or observed under
this Lease. No collection or acceptance of rent by Landlord from any Transferee
shall be deemed a waiver of any provision of this Article 14 or the approval of
any Transferee or a release of Tenant from any obligation under this Lease,
whether theretofore or thereafter accruing. In no event shall Landlord’s
enforcement of any provision of this Lease against any Transferee be deemed a
waiver of Landlord’s right to enforce any term of this Lease against Tenant or
any other person. If Tenant’s obligations hereunder have been guaranteed,
Landlord’s consent to any Transfer shall not be effective unless the guarantor
also consents to such Transfer.

 

22

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

 

14.8                        Non-Transfers. Notwithstanding anything to the
contrary contained in this Article 14, an assignment or subletting of all or a
portion of the Premises to an affiliate of Tenant (an entity which is controlled
by, controls, or is under common control with, Tenant), shall not be deemed a
Transfer under this Article 14, provided that Tenant notifies Landlord of any
such assignment or sublease and promptly supplies Landlord with any documents or
information requested by Landlord regarding such assignment or sublease or such
affiliate, and further provided that such assignment or sublease is not a
subterfuge by Tenant to avoid its obligations under this Lease. “Control,” as
used in this Section 14.8, shall mean the ownership, directly or indirectly, of
at least fifty-one percent (51%) of the voting securities of, or possession of
the right to vote, in the ordinary direction of its affairs, of at least
fifty-one percent (51%) of the voting interest in, any person or entity.

 

ARTICLE 15

 

SURRENDER OF PREMISES; OWNERSHIP AND

REMOVAL OF TRADE FIXTURES

 

15.1                        Surrender of Premises. No act or thing done by
Landlord or any agent or employee of Landlord during the Lease Term shall be
deemed to constitute an acceptance by Landlord of a surrender of the Premises
unless such intent is specifically acknowledged in writing by Landlord. The
delivery of keys to the Premises to Landlord or any agent or employee of
Landlord shall not constitute a surrender of the Premises or effect a
termination of this Lease, whether or not the keys are thereafter retained by
Landlord, and notwithstanding such delivery Tenant shall be entitled to the
return of such keys at any reasonable time upon request until this Lease shall
have been properly terminated. The voluntary or other surrender of this Lease by
Tenant, whether accepted by Landlord or not, or a mutual termination hereof,
shall not work a merger, and at the option of Landlord shall operate as an
assignment to Landlord of all subleases or subtenancies affecting the Premises
or terminate any or all such sublessees or subtenancies.

 

15.2                        Removal of Tenant Property by Tenant. Upon the
expiration of the Lease Term, or upon any earlier termination of this Lease,
Tenant shall, subject to the provisions of this Article 15, quit and surrender
possession of the Premises to Landlord in as good order and condition as when
Tenant took possession and as thereafter improved by Landlord and/or Tenant,
reasonable wear and tear and repairs which are specifically made the
responsibility of Landlord hereunder excepted. Upon such expiration or
termination, Tenant shall, without expense to Landlord, remove or cause to be
removed from the Premises all debris and rubbish, and such items of furniture,
equipment, business and trade fixtures, free-standing cabinet work, movable
partitions and other articles of personal property owned by Tenant or installed
or placed by Tenant at its expense in the Premises, and such similar articles of
any other persons claiming under Tenant, as Landlord may, in its sole
discretion, require to be removed, and Tenant shall repair at its own expense
all damage to the Premises and Building resulting from such removal.

 

ARTICLE 16

 

HOLDING OVER

 

If Tenant holds over after the expiration of the Lease Term or earlier
termination thereof, with or without the express or implied consent of Landlord,
such tenancy shall be from month-to-month only, and shall not constitute a
renewal hereof or an extension for any further term, and in such case Rent shall
be payable at a monthly rate equal to the product of (i) the Rent applicable
during the last rental period of the Lease Term under this Lease, and (ii) a
percentage equal to 150%. Such month-to-month tenancy shall be subject to every
other applicable term, covenant and agreement contained herein. Nothing
contained in this Article 16 shall be construed as consent by Landlord to any
holding over by Tenant, and Landlord expressly reserves the right to require
Tenant to surrender possession of the Premises to Landlord as provided in this
Lease upon the expiration or other termination of this Lease. The provisions of
this Article 16 shall not be deemed to limit or constitute a waiver of any other
rights or remedies of Landlord provided herein or at law. If Tenant fails to
surrender the Premises upon the termination or expiration of this Lease, in
addition to any other liabilities to Landlord accruing therefrom, Tenant shall
protect, defend, indemnify and hold Landlord harmless from all loss, costs
(including reasonable attorneys’ fees) and liability resulting from such
failure, including, without limiting the generality of the foregoing, any claims
made by any succeeding tenant founded upon such failure to surrender and any
lost profits to Landlord resulting therefrom.

 

23

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

 

ARTICLE 17

 

ESTOPPEL CERTIFICATES

 

Within ten (10) business days following a request in writing by Landlord, Tenant
shall execute, acknowledge and deliver to Landlord an estoppel certificate,
which, as submitted by Landlord, shall be substantially in the form of
Exhibit E, attached hereto (or such other form as may be required by any
prospective mortgagee or purchaser of the Project, or any portion thereof),
indicating therein any exceptions thereto that may exist at that time, and shall
also contain any other information reasonably requested by Landlord or
Landlord’s mortgagee or prospective mortgagee. Any such certificate may be
relied upon by any prospective mortgagee or purchaser of all or any portion of
the Project. Tenant shall execute and deliver whatever other instruments may be
reasonably required for such purposes. At any time during the Lease Term,
Landlord may require Tenant to provide Landlord with a current financial
statement and financial statements of the two (2) years prior to the current
financial statement year. Such statements shall be prepared in accordance with
generally accepted accounting principles and, if such is the normal practice of
Tenant, shall be audited by an independent certified public accountant. Failure
of Tenant to timely execute, acknowledge and deliver such estoppel certificate
or other instruments shall constitute an acceptance of the Premises and an
acknowledgment by Tenant that statements included in the estoppel certificate
are true and correct, without exception.

 

ARTICLE 18

 

SUBORDINATION

 

This Lease shall be subject and subordinate to all present and future ground or
underlying leases of the Building or Project and to the lien of any mortgage,
trust deed or other encumbrances now or hereafter in force against the Building
or Project or any part thereof, if any, and to all renewals, extensions,
modifications, consolidations and replacements thereof, and to all advances made
or hereafter to be made upon the security of such mortgages or trust deeds,
unless the holders of such mortgages, trust deeds or other encumbrances, or the
lessors under such ground lease or underlying leases, require in writing that
this Lease be superior thereto. Tenant covenants and agrees in the event any
proceedings are brought for the foreclosure of any such mortgage or deed in lieu
thereof (or if any ground lease is terminated), to attorn, without any
deductions or set-offs whatsoever, to the lienholder or purchaser or any
successors thereto upon any such foreclosure sale or deed in lieu thereof (or to
the ground lessor), if so requested to do so by such purchaser or lienholder or
ground lessor, and to recognize such purchaser or lienholder or ground lessor as
the lessor under this Lease, provided such lienholder or purchaser or ground
lessor shall agree to accept this Lease and not disturb Tenant’s occupancy, so
long as Tenant timely pays the rent and observes and performs the terms,
covenants and conditions of this Lease to be observed and performed by Tenant.
Landlord’s interest herein may be assigned as security at any time to any
lienholder. Tenant shall, within ten (10) days of request by Landlord, execute
such further instruments or assurances as Landlord may reasonably deem necessary
to evidence or confirm the subordination or superiority of this Lease to any
such mortgages, trust deeds, ground leases or underlying leases. Tenant waives
the provisions of any current or future statute, rule or law which may give or
purport to give Tenant any right or election to terminate or otherwise adversely
affect this Lease and the obligations of the Tenant hereunder in the event of
any foreclosure proceeding or sale.

 

ARTICLE 19

 

DEFAULTS; REMEDIES

 

19.1                        Events of Default. The occurrence of any of the
following shall constitute a default of this Lease by Tenant:

 

19.1.1              Any failure by Tenant to pay any Rent or any other charge
required to be paid under this Lease, or any part thereof, when due unless such
failure is cured within five (5) business days after notice; or

 

19.1.2              Except where a specific time period is otherwise set forth
for Tenant’s performance in this Lease, in which event the failure to perform by
Tenant within such time period shall be a default by Tenant under this
Section 19.1.2, any failure by Tenant to observe or perform any other provision,
covenant or condition of this Lease to be observed or performed by Tenant where
such failure continues for thirty (30) days after written notice thereof from

 

24

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

 

Landlord to Tenant; provided that if the nature of such default is such that the
same cannot reasonably be cured within a thirty (30) day period, Tenant shall
not be deemed to be in default if it diligently commences such cure within such
period and thereafter diligently proceeds to rectify and cure such default; or

 

19.1.3              Abandonment or vacation of all or a substantial portion of
the Premises by Tenant; or

 

19.1.4              The failure by Tenant to observe or perform according to the
provisions of Articles 5, 14, 17 or 18 of this Lease where such failure
continues for more than three (3) business days after notice from Landlord; or

 

19.1.5              Tenant’s failure to occupy the Premises within ten
(10) business days after the Lease Commencement Date.

 

The notice periods provided herein are in lieu of, and not in addition to, any
notice periods provided by law.

 

19.2                        Remedies Upon Default. Upon the occurrence of any
event of default by Tenant, Landlord shall have, in addition to any other
remedies available to Landlord at law or in equity (all of which remedies shall
be distinct, separate and cumulative), the option to pursue any one or more of
the following remedies, each and all of which shall be cumulative and
nonexclusive, without any notice or demand whatsoever.

 

19.2.1              Terminate this Lease, in which event Tenant shall
immediately surrender the Premises to Landlord, and if Tenant fails to do so,
Landlord may, without prejudice to any other remedy which it may have for
possession or arrearages in rent, enter upon and take possession of the Premises
and expel or remove Tenant and any other person who may be occupying the
Premises or any part thereof, without being liable for prosecution or any claim
or damages therefor; and Landlord may recover from Tenant the following:

 

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

 

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

 

(iii)                               The worth at the time of award of the amount
by which the unpaid rent for the balance of the Lease Term after the time of
award exceeds the amount of such rental loss that Tenant proves could have been
reasonably avoided; plus

 

(iv)                              Any other amount necessary to compensate
Landlord for all the detriment proximately caused by Tenant’s failure to perform
its obligations under this Lease or which in the ordinary course of things would
be likely to result therefrom, specifically including but not limited to,
brokerage commissions and advertising expenses incurred, expenses of remodeling
the Premises or any portion thereof for a new tenant, whether for the same or a
different use, and any special concessions made to obtain a new tenant; and

 

(v)                                 At Landlord’s election, such other amounts
in addition to or in lieu of the foregoing as may be permitted from time to time
by applicable law.

 

The term “rent” as used in this Section 19.2 shall be deemed to be and to mean
all sums of every nature required to be paid by Tenant pursuant to the terms of
this Lease, whether to Landlord or to others. As used in Sections 19.2.1(i) and
(ii), above, the “worth at the time of award” shall be computed by allowing
interest at the rate set forth in Article 25 of this Lease, but in no case
greater than the maximum amount of such interest permitted by law. As used in
Section 19.2.1(iii) above, the “worth at the time of award” 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%).

 

19.2.2              Landlord shall have the remedy described in California Civil
Code Section 1951.4 (lessor may continue lease in effect after lessee’s breach
and abandonment and recover rent as it becomes due, if lessee has the right

 

25

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

 

to sublet or assign, subject only to reasonable limitations). Accordingly, if
Landlord does not elect to terminate this Lease on account of any default by
Tenant, Landlord may, from time to time, without terminating this Lease, enforce
all of its rights and remedies under this Lease, including the right to recover
all rent as it becomes due.

 

19.2.3                      Landlord shall at all times have the rights and
remedies (which shall be cumulative with each other and cumulative and in
addition to those rights and remedies available under Sections 19.2.1 and
19.2.2, above, or any law or other provision of this Lease), without prior
demand or notice except as required by applicable law, to seek any declaratory,
injunctive or other equitable relief, and specifically enforce this Lease, or
restrain or enjoin a violation or breach of any provision hereof.

 

19.3                        Subleases of Tenant. Whether or not Landlord elects
to terminate this Lease on account of any default by Tenant, as set forth in
this Article 19, Landlord shall have the right to terminate any and all
subleases, licenses, concessions or other consensual arrangements for possession
entered into by Tenant and affecting the Premises or may, in Landlord’s sole
discretion, succeed to Tenant’s interest in such subleases, licenses,
concessions or arrangements. In the event of Landlord’s election to succeed to
Tenant’s interest in any such subleases, licenses, concessions or arrangements,
Tenant shall, as of the date of notice by Landlord of such election, have no
further right to or interest in the rent or other consideration receivable
thereunder.

 

19.4                        Efforts to Relet. No re-entry or repossession,
repairs, maintenance, changes, alterations and additions, reletting, appointment
of a receiver to protect Landlord’s interests hereunder, or any other action or
omission by Landlord shall be construed as an election by Landlord to terminate
this Lease or Tenant’s right to possession, or to accept a surrender of the
Premises, nor shall same operate to release Tenant in whole or in part from any
of Tenant’s obligations hereunder, unless express written notice of such
intention is sent by Landlord to Tenant. Tenant hereby irrevocably waives any
right otherwise available under any law to redeem or reinstate this Lease.

 

ARTICLE 20

 

COVENANT OF QUIET ENJOYMENT

 

Landlord covenants that Tenant, on paying the Rent, charges for services and
other payments herein reserved and on keeping, observing and performing all the
other terms, covenants, conditions, provisions and agreements herein contained
on the part of Tenant to be kept, observed and performed, shall, during the
Lease Term, peaceably and quietly have, hold and enjoy the Premises subject to
the terms, covenants, conditions, provisions and agreements hereof without
interference by any persons lawfully claiming by or through Landlord. The
foregoing covenant is in lieu of any other covenant express or implied.

 

ARTICLE 21

 

SECURITY DEPOSIT

 

Concurrently with Tenant’s execution of this Lease, Tenant shall deposit with
Landlord a security deposit (the “Security Deposit”) in the amount set forth in
Section 8 of the Summary, as security for the faithful performance by Tenant of
all of its obligations under this Lease. If Tenant defaults with respect to any
provisions of this Lease, including, but not limited to, the provisions relating
to the payment of Rent, the removal of property and the repair of resultant
damage, Landlord may, without notice to Tenant, but shall not be required to
apply all or any part of the Security Deposit for the payment of any Rent or any
other sum in default and Tenant shall, upon demand therefor, restore the
Security Deposit to its original amount. Any unapplied portion of the Security
Deposit shall be returned to Tenant, or, at Landlord’s option, to the last
assignee of Tenant’s interest hereunder, within sixty (60) days following the
expiration of the Lease Term. Tenant shall not be entitled to any interest on
the Security Deposit. Tenant hereby waives the provisions of Section 1950.7 of
the California Civil Code, or any successor statute, and all other provisions of
law, now or hereafter in effect, which (i) establish the time frame by which a
landlord must refund a security deposit under a lease, and/or (ii) provide that
a landlord may claim from a security deposit only those sums reasonably
necessary to remedy defaults in the payment of rent, to repair damage caused by
a tenant or to clean the premises, it being agreed that Landlord may, in
addition, claim those sums specified in this Section above and/or those sums
reasonably necessary to compensate Landlord for any loss or damage caused by
Tenant’s default of the Lease, as amended hereby, including, but

 

26

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

 

not limited to, all damages or rent due upon termination of Lease pursuant to
Section 1951.2 of the California Civil Code.

 

ARTICLE 22

 

SUBSTITUTION OF OTHER PREMISES

 

Landlord shall have the right to move Tenant to other space in the Project
comparable to the Premises, and all terms hereof shall apply to the new space
with equal force; provided that Tenant’s then existing monetary obligations
under this Lease shall not be increased as a result of such relocation of the
Premises. In such event, Landlord shall give Tenant prior notice, shall provide
Tenant, at Landlord’s sole cost and expense, with tenant improvements at least
equal in quality to those in the Premises and shall move Tenant’s effects to the
new space at Landlord’s sole cost and expense at such time and in such manner as
to inconvenience Tenant as little as reasonably practicable. In addition,
Landlord shall reimburse Tenant for the reasonable costs and expenses incurred
by Tenant in connection with such relocation (including, but not limited to, the
costs of reasonable supplies of replacement stationery and telephone
installations), within thirty (30) days of Landlord’s receipt of an invoice
therefor. Simultaneously with such relocation of the Premises, the parties shall
immediately execute an amendment to this Lease stating the relocation of the
Premises.

 

ARTICLE 23

 

SIGNS

 

23.1                        Full Floors. Subject to Landlord’s prior written
approval, in its sole discretion, and provided all signs are in keeping with the
quality, design and style of the Building and Project, Tenant, if the Premises
comprise an entire floor of the Building, at its sole cost and expense, may
install identification signage anywhere in the Premises including in the
elevator lobby of the Premises, provided that such signs must not be visible
from the exterior of the Building.

 

23.2                        Multi-Tenant Floors. If other tenants occupy space
on the floor on which the Premises is located, Tenant’s identifying signage
shall be provided by Landlord, at Landlord’s cost as to the initial signage, and
such signage shall be comparable to that used by Landlord for other similar
floors in the Building and shall comply with Landlord’s then-current Building
standard signage program.

 

23.3                        Prohibited Signage and Other Items. Any signs,
notices, logos, pictures, names or advertisements which are installed and that
have not been separately approved by Landlord may be removed without notice by
Landlord at the sole expense of Tenant. Tenant may not install any signs on the
exterior or roof of the Project or the Common Areas. Any signs, window
coverings, or blinds (even if the same are located behind the Landlord-approved
window coverings for the Building), or other items visible from the exterior of
the Premises or Building, shall be subject to the prior approval of Landlord, in
its sole discretion.

 

23.4                        Building Directory. An electronic directory is
located in the lobby of the Building. Tenant shall have the right, at no charge
to Tenant, to have Tenant’s name entered into such electronic directory.

 

ARTICLE 24

 

COMPLIANCE WITH LAW

 

Tenant shall not do anything or suffer anything to be done in or about the
Premises or the Project which will in any way conflict with any law, statute,
ordinance or other governmental rule, regulation or requirement now in force or
which may hereafter be enacted or promulgated. At its sole cost and expense,
Tenant shall promptly comply with all such governmental measures. Should any
standard or regulation now or hereafter be imposed on Landlord or Tenant by a
state, federal or local governmental body charged with the establishment,
regulation and enforcement of occupational, health or safety standards for
employers, employees, landlords or tenants, then Tenant agrees, at its sole cost
and expense, to comply promptly with such standards or regulations. Tenant shall
be responsible, at its sole cost and expense, to make all alterations to the
Premises as are required to comply with the governmental rules, regulations,
requirements or standards described in this Article 24. The judgment of any
court of competent jurisdiction or the

 

27

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

 

admission, of Tenant in any judicial action, regardless of whether Landlord is a
party thereto, that Tenant has violated any of said governmental measures, shall
be conclusive of that fact as between Landlord and Tenant.

 

ARTICLE 25

 

LATE CHARGES

 

If any installment of Rent or any other sum due from Tenant shall not be
received by Landlord or Landlord’s designee when due, then Tenant shall pay to
Landlord a late charge equal to five percent (5%) of the overdue amount plus any
reasonable attorneys’ fees incurred by Landlord by reason of Tenant’s failure to
pay Rent and/or other charges when due hereunder. The late charge shall be
deemed Additional Rent and the right to require it shall be in addition to all
of Landlord’s other rights and remedies hereunder or at law and shall not be
construed as liquidated damages or as limiting Landlord’s remedies in any
manner. In addition to the late charge described above, any Rent or other
amounts owing hereunder which are not paid within ten (10) days after the date
they are due shall bear interest from the date when due until paid at a rate per
annum equal to the lesser of (i) the annual “Bank Prime Loan” rate cited in the
Federal Reserve Statistical Release Publication G. 13(415), published on the
first Tuesday of each calendar month (or such other comparable index as Landlord
and Tenant shall reasonably agree upon if such rate ceases to be published) plus
two (2) percentage points, and (ii) the highest rate permitted by applicable
law.

 

ARTICLE 26

 

LANDLORD’S RIGHT TO CURE DEFAULT; PAYMENTS BY TENANT

 

26.1                        Landlord’s Cure. All covenants and agreements to be
kept or performed by Tenant under this Lease shall be performed by Tenant at
Tenant’s sole cost and expense and without any reduction of Rent, except to the
extent, if any, otherwise expressly provided herein. If Tenant shall fail to
perform any obligation under this Lease, and such failure shall continue in
excess of the time allowed under Section 19.1.2, above, unless a specific time
period is otherwise stated in this Lease, Landlord may, but shall not be
obligated to, make any such payment or perform any such act on Tenant’s part
without waiving its rights based upon any default of Tenant and without
releasing Tenant from any obligations hereunder.

 

26.2                        Tenant’s Reimbursement. Except as may be
specifically provided to the contrary in this Lease, Tenant shall pay to
Landlord, upon delivery by Landlord to Tenant of statements therefor: (i) sums
equal to expenditures reasonably made and obligations incurred by Landlord in
connection with the remedying by Landlord of Tenant’s defaults pursuant to the
provisions of Section 26.1; (ii) sums equal to all losses, costs, liabilities,
damages and expenses referred to in Article 10 of this Lease; and (iii) sums
equal to all expenditures made and obligations incurred by Landlord in
collecting or attempting to collect the Rent or in enforcing or attempting to
enforce any rights of Landlord under this Lease or pursuant to law, including,
without limitation, all reasonable legal fees and other amounts so expended.
Tenant’s obligations under this Section 26.2 shall survive the expiration or
sooner termination of the Lease Term.

 

ARTICLE 27

 

ENTRY BY LANDLORD

 

Landlord reserves the right at all reasonable times and upon at least
twenty-four (24) hours prior notice to Tenant (except in the case of an
emergency in which event no notice shall be required) to enter the Premises to
(i) inspect them; (ii) show the Premises to prospective purchasers, or to
current or prospective mortgagees, ground or underlying lessors or insurers or,
during the last twelve (12) months of the Lease Term, to prospective tenants;
(iii) post notices of nonresponsibility; or (iv) alter, improve or repair the
Premises or the Building, or for structural alterations, repairs or improvements
to the Building or the Building’s systems and equipment. Notwithstanding
anything to the contrary contained in this Article 27, Landlord may enter the
Premises at any time to (A) perform services required of Landlord, including
janitorial service; (B) take possession due to any breach of this Lease in the
manner provided herein; and (C) perform any covenants of Tenant which Tenant
fails to perform. Landlord may make any such entries without the abatement of
Rent, except as otherwise provided in this Lease, and may take such reasonable
steps as required to accomplish the stated purposes. Tenant hereby waives any
claims for damages or for any injuries or inconvenience to or interference with
Tenant’s business, lost profits, any loss of occupancy or quiet enjoyment of the
Premises, and any other

 

28

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

 

loss occasioned thereby, provided that the foregoing shall not limit Landlord’s
liability, if any, pursuant to applicable law for personal injury and property
damage to the extent caused by the gross negligence or willful misconduct of
Landlord, its agents, employees or contractors. For each of the above purposes,
Landlord shall at all times have a key with which to unlock all the doors in the
Premises, excluding Tenant’s vaults, safes and special security areas designated
in advance by Tenant. In an emergency, Landlord shall have the right to use any
means that Landlord may deem proper to open the doors in and to the Premises.
Any entry into the Premises by Landlord in the manner hereinbefore described
shall not be deemed to be a forcible or unlawful entry into, or a detainer of,
the Premises, or an actual or constructive eviction of Tenant from any portion
of the Premises. No provision of this Lease shall be construed as obligating
Landlord to perform any repairs, alterations or decorations except as otherwise
expressly agreed to be performed by Landlord herein.

 

ARTICLE 28

 

COMMUNICATIONS AND COMPUTER LINES

 

Tenant may install, maintain, replace, remove or use any communications or
computer wires and cables serving the Premises (collectively, the “Lines”),
provided that (i) Tenant shall obtain Landlord’s prior written consent, use an
experienced and qualified contractor approved in writing by Landlord, and comply
with all of the other provisions of Articles 7 and 8 of this Lease. (ii) an
acceptable number of spare Lines and space for additional Lines shall be
maintained for existing and future occupants of the Project, as determined in
Landlord’s reasonable opinion, (iii) the Lines therefor (including riser cables)
shall be appropriately insulated to prevent excessive electromagnetic fields or
radiation, shall be surrounded by a protective conduit reasonably acceptable to
Landlord, and shall be identified in accordance with the “Identification
Requirements,” as that term is set forth hereinbelow, (iv) any new or existing
Lines servicing the Premises shall comply with all applicable governmental laws
and regulations, (v) as a condition to permitting the installation of new Lines,
Landlord may require that Tenant remove existing Lines located in or serving the
Premises and repair any damage in connection with such removal, and (vi) Tenant
shall pay all costs in connection therewith. All Lines shall be clearly marked
with adhesive plastic labels (or plastic tags attached to such Lines with wire)
to show Tenant’s name, suite number, telephone number and the name of the person
to contact in the case of an emergency (A) every four feet (4’) outside the
Premises (specifically including, but not limited to, the electrical room risers
and other Common Areas), and (B) at the Lines’ termination
point(s) (collectively, the “Identification Requirements”). Landlord reserves
the right (by notice to Tenant at any time prior to the expiration or earlier
termination of this Lease) to require that Tenant, prior to the expiration or
earlier termination of this Lease, remove any Lines located in or serving the
Premises.

 

ARTICLE 29

 

MISCELLANEOUS PROVISIONS

 

29.1                        Terms; Captions. The words “Landlord” and “Tenant”
as used herein shall include the plural as well as the singular. The necessary
grammatical changes required to make the provisions hereof apply either to
corporations or partnerships or individuals, men or women, as the case may
require, shall in all cases be assumed as though in each case fully expressed.
The captions of Articles and Sections are for convenience only and shall not be
deemed to limit, construe, affect or alter the meaning of such Articles and
Sections.

 

29.2                        Binding Effect. Subject to all other provisions of
this Lease, each of the covenants, conditions and provisions of this Lease shall
extend to and shall, as the case may require, bind or inure to the benefit not
only of Landlord and of Tenant, but also of their respective heirs, personal
representatives, successors or assigns, provided this clause shall not permit
any assignment by Tenant contrary to the provisions of Article 14 of this Lease.

 

29.3                        No Air Rights. No rights to any view or to light or
air over any property, whether belonging to Landlord or any other person, are
granted to Tenant by this Lease. If at any time any windows of the Premises are
temporarily darkened or the light or view therefrom is obstructed by reason of
any repairs, improvements, maintenance or cleaning in or about the Project, the
same shall be without liability to Landlord and without any reduction or
diminution of Tenant’s obligations under this Lease.

 

29.4                        Modification of Lease. Should any current or
prospective mortgagee or ground lessor for the Building or Project require a
modification of this Lease, which modification will not cause an increased cost
or expense

 

29

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

 

to Tenant or in any other way materially and adversely change the rights and
obligations of Tenant hereunder, then and in such event, Tenant agrees that this
Lease may be so modified and agrees to execute whatever documents are reasonably
required therefor and to deliver the same to Landlord within ten (10) business
days following a request therefor. At the request of Landlord or any mortgagee
or ground lessor, Tenant agrees to execute a short form of Lease and deliver the
same to Landlord within ten (10) business days following the request therefor.

 

29.5                        Transfer of Landlord’s Interest. Tenant acknowledges
that Landlord has the right to transfer all or any portion of its interest in
the Project or Building and in this Lease, and Tenant agrees that in the event
of any such transfer, Landlord shall automatically be released from all
liability under this Lease and Tenant agrees to look solely to such transferee
for the performance of Landlord’s obligations hereunder after the date of
transfer and such transferee shall be deemed to have fully assumed and be liable
for all obligations of this Lease to be performed by Landlord, including the
return of any Security Deposit, and Tenant shall attorn to such transferee.

 

29.6                        Prohibition Against Recording. Except as provided in
Section 29.4 of this Lease, neither this Lease, nor any memorandum, affidavit or
other writing with respect thereto, shall be recorded by Tenant or by anyone
acting through, under or on behalf of Tenant.

 

29.7                        Landlord’s Title. Landlord’s title is and always
shall be paramount to the title of Tenant. Nothing herein contained shall
empower Tenant to do any act which can, shall or may encumber the title of
Landlord.

 

29.8                        Relationship of Parties. Nothing contained in this
Lease shall be deemed or construed by the parties hereto or by any third party
to create the relationship of principal and agent, partnership, joint venturer
or any association between Landlord and Tenant.

 

29.9                        Application of Payments. Landlord shall have the
right to apply payments received from Tenant pursuant to this Lease, regardless
of Tenant’s designation of such payments, to satisfy any obligations of Tenant
hereunder, in such order and amounts as Landlord, in its sole discretion, may
elect.

 

29.10                 Time of Essence. Time is of the essence with respect to
the performance of every provision of this Lease in which time of performance is
a factor.

 

29.11                 Partial Invalidity. If any term, provision or condition
contained in this Lease shall, to any extent, be invalid or unenforceable, the
remainder of this Lease, or the application of such term, provision or condition
to persons or circumstances other than those with respect to which it is invalid
or unenforceable, shall not be affected thereby, and each and every other term,
provision and condition of this Lease shall be valid and enforceable to the
fullest extent possible permitted by law.

 

29.12                 No Warranty. In executing and delivering this Lease,
Tenant has not relied on any representations, including, but not limited to, any
representation as to the amount of any item comprising Additional Rent or the
amount of the Additional Rent in the aggregate or that Landlord is furnishing
the same services to other tenants, at all, on the same level or on the same
basis, or any warranty or any statement of Landlord which is not set forth
herein or in one or more of the exhibits attached hereto.

 

29.13                 Landlord Exculpation. The liability of Landlord or the
Landlord Parties to Tenant for any default by Landlord under this Lease or
arising in connection herewith or with Landlord’s operation, management,
leasing, repair, renovation, alteration or any other matter relating to the
Project or the Premises shall be limited solely and exclusively to an amount
which is equal to the lesser of (a) the equity interest of Landlord in the
Building or (b) the equity interest Landlord would have in the Building if the
Building were encumbered by third-party debt in an amount equal to eighty
percent (80%) of the value of the Building (as such value is determined by
Landlord), provided that in no event shall such liability extend to any sales or
insurance proceeds received by Landlord or the Landlord Parties in connection
with the Project, Building or Premises. Neither Landlord, nor any of the
Landlord Parties shall have any personal liability therefor, and Tenant hereby
expressly waives and releases such personal liability on behalf of itself and
all persons claiming by, through or under Tenant. The limitations of liability
contained in this Section 29.13 shall inure to the benefit of Landlord’s and the
Landlord Parties’ present and future partners, beneficiaries, officers,
directors, trustees, shareholders, agents and employees, and their respective
partners, heirs, successors and assigns. Under no circumstances

 

30

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

 

shall any present or future partner of Landlord (if Landlord is a partnership),
or trustee or beneficiary (if Landlord or any partner of Landlord is a trust),
have any liability for the performance of Landlord’s obligations under this
Lease. Notwithstanding any contrary provision herein, neither Landlord nor the
Landlord Parties shall be liable under any circumstances for injury or damage
to, or interference with, Tenant’s business, including but not limited to, loss
of profits, loss of rents or other revenues, loss of business opportunity, loss
of goodwill or loss of use, in each case, however occurring.

 

29.14                 Entire Agreement. It is understood and acknowledged that
there are no oral agreements between the parties hereto affecting this Lease and
this Lease constitutes the parties’ entire agreement with respect to the leasing
of the Premises and supersedes and cancels any and all previous negotiations,
arrangements, brochures, agreements and understandings, if any, between the
parties hereto or displayed by Landlord to Tenant with respect to the subject
matter thereof, and none thereof shall be used to interpret or construe this
Lease. None of the terms, covenants, conditions or provisions of this Lease can
be modified, deleted or added to except in writing signed by the parties hereto.

 

29.15                 Right to Lease. Landlord reserves the absolute right to
effect such other tenancies in the Project as Landlord in the exercise of its
sole business judgment shall determine to best promote the interests of the
Building or Project. Tenant does not rely on the fact, nor does Landlord
represent, that any specific tenant or type or number of tenants shall, during
the Lease Term, occupy any space in the Building or Project.

 

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

 

29.17                 Waiver of Redemption by Tenant. Tenant hereby waives, for
Tenant and for all those claiming under Tenant, any and all rights now or
hereafter existing to redeem by order or judgment of any court or by any legal
process or writ, Tenant’s right of occupancy of the Premises after any
termination of this Lease.

 

29.18                 Notices. All notices, demands, statements, designations,
approvals or other communications (collectively, “Notices”) given or required to
be given by either party to the other hereunder or by law shall be in writing,
shall be (A) sent by United States certified or registered mail, postage
prepaid, return receipt requested (“Mail”), (B) transmitted by telecopy, if such
telecopy is promptly followed by a Notice sent by Mail, (C) delivered by a
nationally recognized overnight courier, or (D) delivered personally. Any Notice
shall be sent, transmitted, or delivered, as the case may be, to Tenant at the
appropriate address set forth in Section 9 of the Summary, or to such other
place as Tenant may from time to time designate in a Notice to Landlord, or to
Landlord at the addresses set forth below, or to such other places as Landlord
may from time to time designate in a Notice to Tenant. Any Notice will be deemed
given (i) three (3) days after the date it is posted if sent by Mail, (ii) the
date the telecopy is transmitted, (iii) the date the overnight courier delivery
is made, or (iv) the date personal delivery is made. As of the date of this
Lease, any Notices to Landlord must be sent, transmitted, or delivered, as the
case may be, to the following addresses:

 

% Beacon Capital Partners, LLC

11755 Wilshire Boulevard

Suite 1770

Los Angeles, California 90025

Attention: Mr. Jeremy B. Fletcher

 

and

 

% Beacon Capital Partners, Inc.

200 State Street, 5th Floor

Boston, MA 02109

Attention: General Counsel

 

31

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

 

and

 

Allen Matkins Leck Gamble Mallory & Natsis LLP

1901 Avenue of the Stars

Suite 1800

Los Angeles, California 90067

Attention: Anton N. Natsis, Esq.

 

29.19                 Joint and Several. If there is more than one Tenant, the
obligations imposed upon Tenant under this Lease shall be joint and several.

 

29.20                 Authority. If Tenant is a corporation, trust or
partnership, each individual executing this Lease on behalf of Tenant hereby
represents and warrants that Tenant is a duly formed and existing entity
qualified to do business in California and that Tenant has full right and
authority to execute and deliver this Lease and that each person signing on
behalf of Tenant is authorized to do so. In such event, Tenant shall within ten
(10) days after execution of this Lease, deliver to Landlord satisfactory
evidence of such authority and, if a corporation, upon demand by Landlord, also
deliver to Landlord satisfactory evidence of (i) good standing in Tenant’s state
of incorporation and (ii) qualification to do business in California.

 

29.21                 Attorneys’ Fees. In the event that either Landlord or
Tenant should bring suit for the possession of the Premises, for the recovery of
any sum due under this Lease, or because of the breach of any provision of this
Lease or for any other relief against the other, then all costs and expenses,
including reasonable attorneys’ fees, incurred by the prevailing party therein
shall be paid by the other party, which obligation on the part of the other
party shall be deemed to have accrued on the date of the commencement of such
action and shall be enforceable whether or not the action is prosecuted to
judgment.

 

29.22                 Governing Law; WAIVER OF TRIAL BY JURY. This Lease shall
be construed and enforced in accordance with the laws of the State of
California. IN ANY ACTION OR PROCEEDING ARISING HEREFROM, LANDLORD AND TENANT
HEREBY CONSENT TO (I) THE JURISDICTION OF ANY COMPETENT COURT WITHIN THE STATE
OF CALIFORNIA, (II) SERVICE OF PROCESS BY ANY MEANS AUTHORIZED BY CALIFORNIA
LAW, AND (III) IN THE INTEREST OF SAVING TIME AND EXPENSE, TRIAL WITHOUT A JURY
IN ANY ACTION, PROCEEDING OR COUNTERCLAIM BROUGHT BY EITHER OF THE PARTIES
HERETO AGAINST THE OTHER OR THEIR SUCCESSORS IN RESPECT OF ANY MATTER ARISING
OUT OF OR IN CONNECTION WITH THIS LEASE, THE RELATIONSHIP OF LANDLORD AND
TENANT, TENANT’S USE OR OCCUPANCY OF THE PREMISES, AND/OR ANY CLAIM FOR INJURY
OR DAMAGE, OR ANY EMERGENCY OR STATUTORY REMEDY. IN THE EVENT LANDLORD COMMENCES
ANY SUMMARY PROCEEDINGS OR ACTION FOR NONPAYMENT OF BASE RENT OR ADDITIONAL
RENT, TENANT SHALL NOT INTERPOSE ANY COUNTERCLAIM OF ANY NATURE OR DESCRIPTION
(UNLESS SUCH COUNTERCLAIM SHALL BE MANDATORY) IN ANY SUCH PROCEEDING OR ACTION,
BUT SHALL BE RELEGATED TO AN INDEPENDENT ACTION AT LAW.

 

29.23                 Submission of Lease. Submission of this instrument for
examination or signature by Tenant does not constitute a reservation of, option
for or option to lease, and it is not effective as a lease or otherwise until
execution and delivery by both Landlord and Tenant.

 

29.24                 Brokers. Landlord and Tenant hereby warrant to each other
that they have had no dealings with any real estate broker or agent in
connection with the negotiation of this Lease, excepting only the real estate
brokers or agents specified in Section 11 of the Summary (the “Brokers”), and
that they know of no other real estate broker or agent who is entitled to a
commission in connection with this Lease. Each party agrees to indemnify and
defend the other party against and hold the other party harmless from any and
all claims, demands, losses, liabilities, lawsuits, judgments, costs and
expenses (including without limitation reasonable attorneys’ fees) with respect
to any leasing commission or equivalent compensation alleged to be owing on
account of any dealings with any real estate broker or agent, other than the
Brokers, occurring by, through, or under the indemnifying party.

 

29.25                 Independent Covenants. This Lease shall be construed as
though the covenants herein between Landlord and Tenant are independent and not
dependent and Tenant hereby expressly waives the benefit of any statute to

 

32

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

 

the contrary and agrees that if Landlord fails to perform its obligations set
forth herein, Tenant shall not be entitled to make any repairs or perform any
acts hereunder at Landlord’s expense or to any setoff of the Rent or other
amounts owing hereunder against Landlord.

 

29.26      Project or Building Name and Signage. Landlord shall have the right
at any time to change the name of the Project or Building and to install, affix
and maintain any and all signs on the exterior and on the interior of the
Project or Building as Landlord may, in Landlord’s sole discretion, desire.
Tenant shall not use the name of the Project or Building or use pictures or
illustrations of the Project or Building in advertising or other publicity or
for any purpose other than as the address of the business to be conducted by
Tenant in the Premises, without the prior written consent of Landlord.

 

29.27      Counterparts. This Lease may be executed in counterparts with the
same effect as if both parties hereto had executed the same document. Both
counterparts shall be construed together and shall constitute a single lease.

 

29.28      Confidentiality. Tenant acknowledges that the content of this Lease
and any related documents are confidential information. Tenant shall keep such
confidential information strictly confidential and shall not disclose such
confidential information to any person or entity other than Tenant’s financial,
legal, and space planning consultants.

 

29.29      Building Renovations. It is specifically understood and agreed that
Landlord has no obligation and has made no promises to alter, remodel, improve,
renovate, repair or decorate the Premises, Building, or any part thereof and
that no representations respecting the condition of the Premises or the Building
have been made by Landlord to Tenant except as specifically set forth herein or
in the Tenant Work Letter. However, Tenant hereby acknowledges that Landlord is
currently renovating or may during the Lease Term renovate, improve, alter, or
modify (collectively, the “Renovations”) the Project, the Building and/or the
Premises. Tenant hereby agrees that such Renovations shall in no way constitute
a constructive eviction of Tenant nor entitle Tenant to any abatement of Rent.
Landlord shall have no responsibility and shall not be liable to Tenant for any
injury to or interference with Tenant’s business arising from the Renovations,
nor shall Tenant be entitled to any compensation or damages from Landlord for
loss of the use of the whole or any part of the Premises or of Tenant’s personal
property or improvements resulting from the Renovations, or for any
inconvenience or annoyance occasioned by such Renovations.

 

29.30      No Violation. Tenant hereby warrants and represents that neither its
execution of nor performance under this Lease shall cause Tenant to be in
violation of any agreement, instrument, contract, law, rule or regulation by
which Tenant is bound, and Tenant shall protect, defend, indemnify and hold
Landlord harmless against any claims, demands, losses, damages, liabilities,
costs and expenses, including, without limitation, reasonable attorneys’ fees
and costs, arising from Tenant’s breach of this warranty and representation.

 

29.31      Transportation Management. Tenant shall fully comply with all present
or future programs intended to manage parking, transportation or traffic in and
around the Project and/or the Building, and in connection therewith, Tenant
shall take responsible action for the transportation planning and management of
all employees located at the Premises by working directly with Landlord, any
governmental transportation management organization or any other
transportation-related committees or entities. Such programs may include,
without limitation: (i) restrictions on the number of peak-hour vehicle trips
generated by Tenant; (ii) increased vehicle occupancy; (iii) implementation of
an in-house ridesharing program and an employee transportation coordinator;
(iv) working with employees and any Project, Building or area-wide ridesharing
program manager; (v) instituting employer-sponsored incentives (financial or
in-kind) to encourage employees to rideshare; and (vi) utilizing flexible work
shifts for employees.

 

29.32      Parking. Tenant shall rent from Landlord, commencing on the Lease
Commencement Date, one (1) unreserved parking pass, on a monthly basis
throughout the Lease Term, which parking passes shall pertain to the Project
parking facility. Tenant shall pay to Landlord for automobile parking passes on
a monthly basis the prevailing rate charged from time to time at the location of
such parking passes. In addition, Tenant shall be responsible for the full
amount of any taxes imposed by any governmental authority in connection with the
renting of such parking passes by Tenant or the use of the parking facility by
Tenant. Tenant’s continued right to use the parking passes is conditioned upon
Tenant abiding by all rules and regulations which are prescribed from time to
time for the orderly operation and use of the parking facility where the parking
passes are located, including any sticker or other identification system
established by Landlord, Tenant’s cooperation in seeing that Tenant’s employees
and visitors also comply with such rules

 

33

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

 

and regulations and Tenant not being in default under this Lease. Landlord
specifically reserves the right to change the size, configuration, design,
layout and all other aspects of the Project parking facility at any time and
Tenant acknowledges and agrees that Landlord may, without incurring any
liability to Tenant and without any abatement of Rent under this Lease, from
time to time, close-off or restrict access to the Project parking facility for
purposes of permitting or facilitating any such construction, alteration or
improvements. Landlord may, at any time, institute valet assisted parking,
tandem parking stalls, “stack” parking, or other parking program within the
Project parking facility, the cost of which shall be included in Operating
Expenses, and Landlord may, at any time, designate all or any portion of Tenants
unreserved parking passes for the use of parking in an offsite parking facility
reasonably designated by Landlord, and Tenant and its employees shall comply
with any such measures. Landlord may delegate its responsibilities hereunder to
a parking operator in which case such parking operator shall have all the rights
of control attributed hereby to the Landlord. The parking passes rented by
Tenant pursuant to this Section 29.32 are provided to Tenant solely for use by
Tenant’s own personnel and such passes may not be transferred, assigned,
subleased or otherwise alienated by Tenant without Landlord’s prior approval.
Tenant may validate visitor parking by such method or methods as the Landlord
may establish, at the validation rate from time to time generally applicable to
visitor parking.

 

[Signatures follow on next page]

 

34

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

 

IN WITNESS WHEREOF, Landlord and Tenant have caused this Lease to be executed
the day and date first above written.

 

LANDLORD:

TENANT:

 

 

 

221 MAIN PROPERTY OWNER 221 MainLLC,

C1 CONSULTING LIMITED LIABILITY

a Delaware limited liability company

COMPANY, a New Jersey limited liability company

 

 

 

By:

/s/ Jeremy B. Fletcher

By:

/s/ Elizabeth Rountree

Name:

Jeremy B. Fletcher

 

 

Title:

Senior Managing Director

 

Its:

Managing Director

 

 

 

 

 

 

 

By:

 

 

 

 

 

 

 

 

 

 

Its:

 

 

35

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

 

EXHIBIT A 221MAIN STREET OUTLINE OF PREMISES nicholsbooth S\Jke 525 .S..an
Francs.::o (;41C'!i Jlllol-0" OlOill EXHIBIT A 187287.83fWLA Zl l MAlN S IREEJ
-1-371700-00001/4-2-13/sb/sb [Cl Consulting Limited Liability Company] r r-:r
SDec SIJte 1580; OpHon 1 221 M'*' S1reet b FrmclscO. C.A 221MainSleet ]
C.1HfomiaRRCH IT€tT5 f-'l --D J § ' 1-,J - I I ---I

[g206073ko19i001.jpg]

 

 

EXHIBIT B

 

221 MAIN STREET

 

TENANT WORK LETTER

 

1.             Tenant Improvements. Except as provided below, Landlord shall not
be obligated to construct or install or pay for any improvements or facilities
of any kind in the Premises, and Tenant shall accept the Premises in its
currently-existing, “as-is” condition. Notwithstanding the foregoing, but
subject to the terms of this Tenant Work Letter, Landlord shall (i) perform the
work set forth on Schedule 1, attached hereto, (ii) install one (1) Building
standard dishwasher in the Premises, and (iii) install one (1) Building standard
garbage disposal in the Premises (collectively the “Tenant Improvements”). The
Tenant Improvements shall be completed by Landlord in accordance with Building
standards. Tenant shall have no right to modify or alter the Tenant
Improvements.

 

2.             Warranties and Guaranties. Landlord hereby assigns to Tenant all
warranties and guaranties by the contractor who constructs or installs the
Tenant Improvements, and Tenant hereby waives all claims against Landlord
relating to, or arising out of the construction or installation of, the Tenant
Improvements.

 

3.             Ready for Occupancy. The Premises shall be considered “Ready for
Occupancy” upon the substantial completion by Landlord of the Tenant
Improvements. For purposes of this Lease, “substantial completion” of the Tenant
Improvements shall occur upon the completion of the Tenant Improvements, with
the exception of any punchlist or other items which do not prevent or materially
adversely affect Tenant’s use or occupancy of the Premises. In the event that
the acts or omissions of Tenant shall delay the substantial completion of the
Tenant Improvements, then the Premises shall be deemed to be Ready for Occupancy
as of the date the same would have occurred but for such act or omission of
Tenant.

 

4.             Tenant’s Entry Into the Premises Prior to substantial completion.
Provided that Tenant and its agents do not interfere with Landlord’s work in the
Building and the Premises, Landlord shall allow Tenant access to the Premises at
least two (2) weeks prior to the substantial completion of the Tenant
Improvements in the Premises for the purpose of Tenant installing overstandard
equipment or fixtures (including Tenant’s data and telephone equipment) in the
Premises. Prior to Tenant’s entry into the Premises as permitted by the terms of
this Section 5, Tenant shall submit a schedule to Landlord, for its approval,
which schedule shall detail the timing and purpose of Tenant’s entry. Tenant
shall hold Landlord harmless from and indemnify, protect and defend Landlord
against any loss or damage to the Building or Premises and against injury to any
persons caused by Tenant’s actions pursuant to this Section 5.

 

1

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

 

SCHEDULE I V!..l VoSS DOOR 0 REJ..OCll. E t.IIU.\IiORK. OR ADJUST EXISTN3 OOLtlC
FER tat. \::../ RRCHIT€CT5 Sell FrcllCIICO. CA SCHEDULE 1 707207 041WJ A 2ll
HAI}18TilQYf -I-371700-00001/4-5-13/sb/sb (Cl Cunsu1ting Limited Liability
Company] KEY NOTES 0MER OOIL!liNG !)TAN1/,o!,RO STNN Clltl!:'lE
OO()fl,F!Wo!E.AND HA@ ADJ'JST (lPOJ AREA LIIITINI,l. @ !-lEW &lllOING STAAQA!ID
GI.J\Zit WTTH OR\'WA!l 'ro OCCK ASM.0 AOO .ALT. INS!All A CI.J>SS: 0000 @ tEA()
El(!STJt(;Ott17:\ II*STAI.l 9llll.Ofife ST,-NI.WiD r;;\. I All SUUllNG :2. CEIUG
GRil_:lnLE AND LIGHT FIXWRES rrJr n Optton 1 O&Olll ...-r-oo nicholsbooth

[g206073ko23i001.jpg]

 

 

EXHIBIT C

 

221 MAIN STREET

 

NOTICE OF LEASE TERM DATES

 

To:

 

 

 

Re:                             Office Lease dated              , 20     
between        , a                   (“Landlord”), and                       , a
                  (“Tenant”) concerning Suite         on floor(s)             of
the office building located at 221 Main Street, San Francisco, California.

 

Gentlemen:

 

In accordance with the Office Lease (the “Lease”), we wish to advise you and/or
confirm as follows:

 

1.                                      The Lease Term shall commence on or has
commenced on            for a term of             ending on        .

 

2.                                      Rent commenced to accrue on           ,
in the amount of                   .

 

3.                                      If the Lease Commencement Date is other
than the first day of the month, the first billing will contain a pro rata
adjustment. Each billing thereafter, with the exception of the final billing,
shall be for the full amount of the monthly installment as provided for in the
Lease.

 

4.                                      Your rent checks should be made payable
to                  at           .

 

5.                                      The exact number of rentable square feet
within the Premises is                     square feet.

 

6.                                      Tenant’s Share as adjusted based upon
the exact number of rentable square feet within the Premises is               %.

 

 

“Landlord”:

 

 

 

                                                                                                                  ,

 

a

 

 

 

 

By:

 

 

 

 

 

 

 

Its:

 

 

1

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

 

Agreed to and Accepted as

 

of       , 200   .

 

 

 

“Tenant”:

 

 

 

 

 

a

 

 

 

 

By:

 

 

 

 

 

 

Its:

 

 

 

2

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

 

EXHIBIT D

 

221 MAIN STREET

 

RULES AND REGULATIONS

 

Tenant shall faithfully observe and comply with the following Rules and
Regulations. Landlord shall not be responsible to Tenant for the nonperformance
of any of said Rules and Regulations by or otherwise with respect to the acts or
omissions of any other tenants or occupants of the Project. In the event of any
conflict between the Rules and Regulations and the other provisions of this
Lease, the latter shall control.

 

1.                                      Tenant shall not alter any lock or
install any new or additional locks or bolts on any doors or windows of the
Premises without obtaining Landlord’s prior written consent. Tenant shall bear
the cost of any lock changes or repairs required by Tenant. Two keys will be
furnished by Landlord for the Premises, and any additional keys required by
Tenant must be obtained from Landlord at a reasonable cost to be established by
Landlord. Upon the termination of this Lease, Tenant shall restore to Landlord
all keys of stores, offices, and toilet rooms, either furnished to, or otherwise
procured by, Tenant and in the event of the loss of keys so furnished, Tenant
shall pay to Landlord the cost of replacing same or of changing the lock or
locks opened by such lost key if Landlord shall deem it necessary to make such
changes.

 

2.                                      All doors opening to public corridors
shall be kept closed at all times except for normal ingress and egress to the
Premises.

 

3.                                      Landlord reserves the right to close and
keep locked all entrance and exit doors of the Building during such hours as are
customary for comparable buildings in the downtown San Francisco, California
area. Tenant, its employees and agents must be sure that the doors to the
Building are securely closed and locked when leaving the Premises if it is after
the normal hours of business for the Building. Any tenant, its employees, agents
or any other persons entering or leaving the Building at any time when it is so
locked, or any time when it is considered to be after normal business hours for
the Building, may be required to sign the Building register. Access to the
Building may be refused unless the person seeking access has proper
identification or has a previously arranged pass for access to the Building.
Landlord will furnish passes to persons for whom Tenant requests same in
writing. Tenant shall be responsible for all persons for whom Tenant requests
passes and shall be liable to Landlord for all acts of such persons. The
Landlord and his agents 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
case of invasion, mob, riot, public excitement, or other commotion, Landlord
reserves the right to prevent access to the Building or the Project during the
continuance thereof by any means it deems appropriate for the safety and
protection of life and property.

 

4.                                      No furniture, freight or equipment of
any kind shall be brought into the Building without prior notice to Landlord.
All moving activity into or out of the Building shall be scheduled with Landlord
and done only at such time and in such manner as Landlord designates. Landlord
shall have the right to prescribe the weight, size and position of all safes and
other heavy property brought into the Building and also the times and manner of
moving the same in and out of the Building. Safes and other heavy objects shall,
if considered necessary by Landlord, stand on supports of such thickness as is
necessary to properly distribute the weight. Landlord will not be responsible
for loss of or damage to any such safe or property in any case. Any damage to
any part of the Building, its contents, occupants or visitors by moving or
maintaining any such safe or other property shall be the sole responsibility and
expense of Tenant.

 

5.                                      No furniture, packages, supplies,
equipment or merchandise will be received in the Building or carried up or down
in the elevators, except between such hours, in such specific elevator and by
such personnel as shall be designated by Landlord.

 

6.                                      The requirements of Tenant will be
attended to only upon application at the management office for the Project or at
such office location designated by Landlord. Employees of Landlord shall not
perform any work or do anything outside their regular duties unless under
special instructions from Landlord.

 

1

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

 

7.                                      No sign, advertisement, notice or
handbill shall be exhibited, distributed, painted or affixed by Tenant on any
part of the Premises or the Building without the prior written consent of the
Landlord. Tenant shall not disturb, solicit, peddle, or canvass any occupant of
the Project and shall cooperate with Landlord and its agents of Landlord to
prevent same.

 

8.                                      The toilet rooms, urinals, wash bowls
and other apparatus shall not be used for any purpose other than that for which
they were constructed, and no foreign substance of any kind whatsoever shall be
thrown therein. The expense of any breakage, stoppage or damage resulting from
the violation of this rule shall be borne by the tenant who, or whose servants,
employees, agents, visitors or licensees shall have caused same.

 

9.                                      Tenant shall not overload the floor of
the Premises, nor mark, drive nails or screws, or drill into the partitions,
woodwork or drywall or in any way deface the Premises or any part thereof
without Landlord’s prior written consent. Tenant shall not purchase spring
water, ice, towel, linen, maintenance or other like services from any person or
persons not approved by Landlord.

 

10.                               Except for vending machines intended for the
sole use of Tenant’s employees and invitees, no vending machine or machines
other than fractional horsepower office machines shall be installed, maintained
or operated upon the Premises without the written consent of Landlord.

 

11.                               Tenant shall not use or keep in or on the
Premises, the Building, or the Project any kerosene, gasoline or other
inflammable or combustible fluid, chemical, substance or material.

 

12.                               Tenant shall not without the prior written
consent of Landlord use any method of heating or air conditioning other than
that supplied by Landlord.

 

13.                               Tenant shall not use, keep or permit to be
used or kept, any foul or noxious gas or substance in or on the Premises, or
permit or allow the Premises to be occupied or used in a manner offensive or
objectionable to Landlord or other occupants of the Project by reason of noise,
odors, or vibrations, or interfere with other tenants or those having business
therein, whether by the use of any musical instrument, radio, phonograph, or in
any other way. Tenant shall not throw anything out of doors, windows or
skylights or down passageways.

 

14.                               Tenant shall not bring into or keep within the
Project, the Building or the Premises any animals, birds, aquariums, or, except
in areas designated by Landlord, bicycles or other vehicles.

 

15.                               No cooking shall be done or permitted on the
Premises, nor shall the Premises be used for the storage of merchandise, for
lodging or for any improper, objectionable or immoral purposes. Notwithstanding
the foregoing, Underwriters’ laboratory-approved equipment and microwave ovens
may be used in the Premises for heating food and brewing coffee, tea, hot
chocolate and similar beverages for employees and visitors, provided that such
use is in accordance with all applicable federal, state, county and city laws,
codes, ordinances, rules and regulations.

 

16.                               The Premises shall not be used for
manufacturing or for the storage of merchandise except as such storage may be
incidental to the use of the Premises provided for in the Summary. Tenant shall
not occupy or permit any portion of the Premises to be occupied as an office for
a messenger-type operation or dispatch office, public stenographer or typist, or
for the manufacture or sale of liquor, narcotics, or tobacco in any form, or as
a medical office, or as a barber or manicure shop, or as an employment bureau
without the express prior written consent of Landlord. Tenant shall not engage
or pay any employees on the Premises except those actually working for such
tenant on the Premises nor advertise for laborers giving an address at the
Premises.

 

17.                               Landlord reserves the right to exclude or
expel from the Project any person who, in the judgment of Landlord, is
intoxicated or under the influence of liquor or drugs, or who shall in any
manner do any act in violation of any of these Rules and Regulations.

 

18.                               Tenant, its employees and agents shall not
loiter in or on the entrances, corridors, sidewalks, lobbies, courts, halls,
stairways, elevators, vestibules or any Common Areas for the purpose of smoking
tobacco products or for

 

2

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

 

any other purpose, nor in any way obstruct such areas, and shall use them only
as a means of ingress and egress for the Premises.

 

19.                               Tenant shall not waste electricity, water or
air conditioning and agrees to cooperate fully with Landlord to ensure the most
effective operation of the Building’s heating and air conditioning system, and
shall refrain from attempting to adjust any controls.

 

20.                               Tenant shall store all its trash and garbage
within the interior of the Premises. No material shall be placed in the 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 San Francisco, California without violation of any law or
ordinance governing such disposal. All trash, garbage and refuse disposal shall
be made only through entry-ways and elevators provided for such purposes at such
times as Landlord shall designate.

 

21.                               Tenant shall comply with all safety, fire
protection and evacuation procedures and regulations established by Landlord or
any governmental agency.

 

22.                               Any persons employed by Tenant to do
janitorial work shall be subject to the prior written approval of Landlord, and
while in the Building and outside of the Premises, shall be subject to and under
the control and direction of the Building manager (but not as an agent or
servant of such manager or of Landlord), and Tenant shall be responsible for all
acts of such persons.

 

23.                               No awnings or other projection shall be
attached to the outside walls of the Building without the prior written consent
of Landlord, and no curtains, blinds, shades or screens shall be attached to or
hung in, or used in connection with, any window or door of the Premises other
than Landlord standard drapes. All electrical ceiling fixtures hung in the
Premises or spaces along the perimeter of the Building must be fluorescent
and/or of a quality, type, design and a warm white bulb color approved in
advance in writing by Landlord. Neither the interior nor exterior of any windows
shall be coated or otherwise sunscreened without the prior written consent of
Landlord. Tenant shall abide by Landlord’s regulations concerning the opening
and closing of window coverings which are attached to the windows in the
Premises, if any, which have a view of any interior portion of the Building or
Building Common Areas.

 

24.                               The sashes, sash doors, skylights, windows,
and doors that reflect or admit light and air into the halls, passageways or
other public places in the Building shall not be covered or obstructed by
Tenant, nor shall any bottles, parcels or other articles be placed on the
windowsills.

 

25.                               Tenant must comply with requests by the
Landlord concerning the informing of their employees of items of importance to
the Landlord.

 

26.                               Tenant must comply with the State of
California “No-Smoking” law set forth in California Labor Code Section 6404.5,
and any local “No-Smoking” ordinance which may be in effect from time to time
and which is not superseded by such State law.

 

27.                               Tenant hereby acknowledges that Landlord shall
have no obligation to provide guard service or other security measures for the
benefit of the Premises, the Building or the Project. Tenant hereby assumes all
responsibility for the protection of Tenant and its agents, employees,
contractors, invitees and guests, and the property thereof, from acts of third
parties, including keeping doors locked and other means of entry to the Premises
closed, whether or not Landlord, at its option, elects to provide security
protection for the Project or any portion thereof. Tenant further assumes the
risk that any safety and security devices, services and programs which Landlord
elects, in its sole discretion, to provide may not be effective, or may
malfunction or be circumvented by an unauthorized third party, and Tenant shall,
in addition to its other insurance obligations under this Lease, obtain its own
insurance coverage to the extent Tenant desires protection against losses
related to such occurrences. Tenant shall cooperate in any reasonable safety or
security program developed by Landlord or required by law.

 

28.                               All office equipment of any electrical or
mechanical nature shall be placed by Tenant in the Premises in settings approved
by Landlord, to absorb or prevent any vibration, noise and annoyance.

 

3

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

 

29.                               Tenant shall not use in any space or in the
public halls of the Building, any hand trucks except those equipped with rubber
tires and rubber side guards.

 

30.                               No auction, liquidation, fire sale,
going-out-of-business or bankruptcy sale shall be conducted in the Premises
without the prior written consent of Landlord.

 

31.                               No tenant shall use or permit the use of any
portion of the Premises for living quarters, sleeping apartments or lodging
rooms.

 

Landlord reserves the right at any time to change or rescind any one or more of
these Rules and Regulations, or to make such other and further reasonable
Rules and Regulations as in Landlord’s judgment may from time to time be
necessary for the management, safety, care and cleanliness of the Premises,
Building, the Common Areas and the Project, and for the preservation of good
order therein, as well as for the convenience of other occupants and tenants
therein. Landlord may waive any one or more of these Rules and Regulations for
the benefit of any particular tenants, but no such waiver by Landlord shall be
construed as a waiver of such Rules and Regulations in favor of any other
tenant, nor prevent Landlord from thereafter enforcing any such Rules or
Regulations against any or all tenants of the Project. Tenant shall be deemed to
have read these Rules and Regulations and to have agreed to abide by them as a
condition of its occupancy of the Premises.

 

4

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

 

EXHIBIT E

 

221 MAIN STREET

 

FORM OF TENANT’S ESTOPPEL CERTIFICATE

 

The undersigned as Tenant under that certain Office Lease (the “Lease”) made and
entered into as of                   , 20     by and between
                    as Landlord, and the undersigned as Tenant, for Premises on
the                    floor(s) of the office building located at 221 Main
Street, San Francisco, California, certifies as follows:

 

1.             Attached hereto as Exhibit A is a true and correct copy of the
Lease and all amendments and modifications thereto. The documents contained in
Exhibit A represent the entire agreement between the parties as to the Premises.

 

2.             The undersigned currently occupies the Premises described in the
Lease, the Lease Term commenced on                   , and the Lease Term
expires on                  , and the undersigned has no option to terminate or
cancel the Lease or to purchase all or any part of the Premises, the Building
and/or the Project.

 

3.             Base Rent became payable on                        .

 

4.             The Lease is in full force and effect and has not been modified,
supplemented or amended in any way except as provided in Exhibit A.

 

5.             Tenant has not transferred, assigned, or sublet any portion of
the Premises nor entered into any license or concession agreements with respect
thereto except as follows:

 

6.             Tenant shall not modify the documents contained in Exhibit A
without the prior written consent of Landlord’s mortgagee.

 

7.             All monthly installments of Base Rent, all Additional Rent and
all monthly installments of estimated Additional Rent have been paid when due
through                . The current monthly installment of Base Rent is $
                   .

 

8.             All conditions of the Lease to be performed by Landlord necessary
to the enforceability of the Lease have been satisfied and Landlord is not in
default thereunder. In addition, the undersigned has not delivered any notice to
Landlord regarding a default by Landlord thereunder. The Lease does not require
Landlord to provide any rental concessions or to pay any leasing brokerage
commissions.

 

9.             No rental has been paid more than thirty (30) days in advance and
no security has been deposited with Landlord except as provided in the Lease.
Neither Landlord, nor its successors or assigns, shall in any event be liable or
responsible for, or with respect to, the retention, application and/or return to
Tenant of any security deposit paid to any prior landlord of the Premises,
whether or not still held by any such prior landlord, unless and until the party
from whom the security deposit is being sought, whether it be a lender, or any
of its successors or assigns, has actually received for its own account, as
landlord, the full amount of such security deposit.

 

10.          As of the date hereof, there are no existing defenses or offsets,
or, to the undersigned’s knowledge, claims or any basis for a claim, that the
undersigned has against Landlord.

 

1

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

 

11.          If Tenant is a corporation or partnership, each individual
executing this Estoppel Certificate on behalf of Tenant hereby represents and
warrants that Tenant is a duly formed and existing entity qualified to do
business in California and that Tenant has full right and authority to execute
and deliver this Estoppel Certificate and that each person signing on behalf of
Tenant is authorized to do so.

 

12.          There are no actions pending against the undersigned under the
bankruptcy or similar laws of the United States or any state.

 

13.          Tenant is in full compliance with all federal, state and local
laws, ordinances, rules and regulations affecting its use of the Premises,
including, but not limited to, those laws, ordinances, rules or regulations
relating to hazardous or toxic materials. Tenant has never permitted or
suffered, nor does Tenant have any knowledge of, the generation, manufacture,
treatment, use, storage, disposal or discharge of any hazardous, toxic or
dangerous waste, substance or material in, on, under or about the Project or the
Premises or any adjacent premises or property in violation of any federal, state
or local law, ordinance, rule or regulation.

 

14.          To the undersigned’s knowledge, all tenant improvement work to be
performed by Landlord under the Lease has been completed in accordance with the
Lease and has been accepted by the undersigned and all reimbursements and
allowances due to the undersigned under the Lease in connection with any tenant
improvement work have been paid in full. All work (if any) in the common areas
required by the Lease to be completed by Landlord has been completed and all
parking spaces required by the Lease have been furnished and/or all parking
ratios required by the Lease have been met.

 

The undersigned acknowledges that this Estoppel Certificate may be delivered to
Landlord or to a prospective mortgagee or prospective purchaser, and
acknowledges that said prospective mortgagee or prospective purchaser will be
relying upon the statements contained herein in making the loan or acquiring the
property of which the Premises are a part and that receipt by it of this
certificate is a condition of making such loan or acquiring such property.

 

Executed at                       on the             day of                 ,
20        .

 

 

“Tenant”:

 

 

 

                                                                        ,

 

a

 

 

 

 

By:

 

 

 

Its:

 

 

 

 

 

 

By:

 

 

 

Its:

 

 

2

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

 

FIRST AMENDMENT TO LEASE

(221 Main, San Francisco, California:
CRA International, Inc.)

 

THIS FIRST AMENDMENT TO LEASE (this “Amendment”) is made and entered into as of
July 21, 2017, by and between COLUMBIA REIT — 221 MAIN, LLC, a Delaware limited
liability company (“Landlord”), and CRA INTERNATIONAL, INC., a Massachusetts
corporation (“Tenant”).

 

RECITALS:

 

A.                                    Landlord, as successor of 221 Main
Property Owner LLC, a Delaware limited liability company, and C1 Consulting
Limited Liability Company, a New Jersey limited liability company (“Original
Tenant”) entered into that certain Office Lease dated as of April 2, 2013 (the
“Lease”), respecting certain office space located in the office building located
at, and commonly known as, 221 Main Street, San Francisco, California (the
“Building”) which contains approximately 387,943 rentable square feet of space.

 

B.                                    Pursuant to the Assignment of Lease with
an effective date of January 31, 2017, Original Tenant assigned and Tenant
assumed all of the obligations under the Lease arising from or after January 31,
2017.

 

C.                                    Pursuant to the terms of the Lease, Tenant
is currently leasing from Landlord approximately 2,694 rentable square feet of
space located on the fifteenth (15th) floor of the Building and commonly known
as Suite 1580, as further set forth in Exhibit A to the Lease (the “Existing
Premises”).  The Lease Term for the Existing Premises is currently scheduled to
expire on August 31, 2018 (the “Existing Premises Termination Date”).

 

D.                                    The parties desire to relocate Tenant
within the Building from the Premises to new premises containing approximately
11,900 square feet of rentable space located on the sixteenth (16th) floor of
the Building, as more particularly designated as Suite 1650 and shown as the
unshaded area on the floor plan of the sixteenth (16th) floor of the Building
attached hereto as Exhibit A (the “New Premises”).

 

E.                                     Landlord and Tenant now desire to amend
the Lease as more particularly set forth herein.

 

AGREEMENT:

 

NOW, THEREFORE, in consideration of the foregoing recitals and the mutual
covenants contained herein, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby agree as follows.

 

1.                                      Interpretation.  Capitalized terms used
in this Amendment and not defined herein shall have the meanings set forth in
the Lease, provided however, that in the case of any conflict, uncertainty or
ambiguity that may arise when interpreting the provisions of the Lease and the

 

1

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

 

provisions set forth in this Amendment, the provisions of this Amendment shall
be controlling for the purpose of resolving any such conflict, uncertainty or
ambiguity.

 

2.                                      New Premises Commencement Date.  The
“New Premises Commencement Date” shall be later to occur of (a) September 1,
2017, and (b) the date on which Landlord delivers the New Premises to Tenant
with Landlord’s Work (as defined in the Work Agreement (the “Work Agreement”)
attached hereto as Exhibit B) Substantially Completed (as defined in the Work
Agreement).  Landlord shall use commercially reasonable efforts to promptly
inform Tenant of any material change in the schedule to Substantially Complete
Landlord’s Work which will impact the Anticipated New Premises Commencement Date
(as defined below in this Section 2) to permit Tenant to prepare for the
relocation to the New Premises.  Upon the New Premises Commencement Date, the
following defined terms in the Lease shall change as follows:  (i) the
“Premises” shall become the New Premises, and (ii) “Tenant’s Share” shall be
3.07%.  Tenant’s Share for the New Premises is based on the rentable square
footage of the New Premises and the Building set forth in the Recitals to this
Amendment, which have been determined on a consistent basis using a modified
BOMA ANSI-Z65.1-2010.  Landlord and Tenant have agreed to use the rentable
square footage numbers set forth in the Recitals to this Amendment as the basis
of calculating the rent due under this Amendment and Tenant’s Share for the
initial Lease Term.  The rent due under this Lease and Tenant’s Share shall not
be subject to revision if the actual rentable square footages are more or less
than as stated in this Amendment, except as expressly provided elsewhere in this
Lease (for example, in the event of an expansion of the Premises as described in
Section 14).  No representation or warranty of any kind, express or implied, is
given to Tenant with respect to the square footage of the New Premises or the
Building.  The parties anticipate that the New Premises Commencement Date will
occur on or about October 1, 2017 (the “Anticipated New Premises Commencement
Date”) and Landlord shall use its commercially reasonable efforts to
Substantially Complete Landlord’s Work and deliver the New Premises to Tenant on
or before such anticipated New Premises Commencement Date.

 

3.                                      Delivery of New Premises.  Landlord
shall deliver the New Premises to Tenant with Landlord’s Work Substantially
Complete and with all building systems and subsystems serving the New Premises,
the structural elements of the New Premises and the foundation of the Building
in good condition, working order and repair.  It is presently anticipated that
the New Premises will be delivered to Tenant on or about the Anticipated New
Premises Commencement Date; provided, however, that if Landlord does not deliver
possession of the New Premises by such date, Landlord shall not have any
liability whatsoever, and this Lease shall not be rendered void or voidable, as
a result thereof.

 

4.                                      Early Entry to New Premises.  “Move In
Period” shall mean the period commencing on or before the fourteenth (14th) day
prior to the New Premises Commencement Date and continuing through the day
before the New Premises Commencement Date, and also including, but with respect
to Tenant’s installation of cabling only, those additional periods prior to the
New Premises Commencement Date for the New Premises, if any, of a duration and
at a time as Landlord shall reasonably determine to be appropriate, for Tenant
to install cabling into the New Premises considering the timing and schedule of
all construction activities with respect

 

2

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

 

thereto.  Tenant shall have the right to install in the New Premises, during the
Move In Period only, Tenant’s cabling and other furniture, furnishings,
inventory, equipment, or trade fixtures, subject to all applicable terms and
conditions of this Lease.  At Tenant’s request from time to time Landlord will
inform Tenant of Landlord’s good faith determination of the projected New
Premises Commencement Date.  Neither Tenant nor any Tenant Parties shall enter
the Premises during those times that Landlord determines such entry will
unreasonably interfere with activities of Landlord or Landlord’s contractors,
and, in such event, Landlord shall notify Tenant of specific times during which
Tenant may make such entry.  Any and all activity by Tenant or any Tenant
Parties prior to the New Premises Commencement Date shall be coordinated with
Landlord and its general contractor to ensure that such activity does not
interfere with any other work.  If Landlord reasonably determines that any such
interference is occurring, then Landlord shall have the right to require the
removal of  the offending party from the New Premises (with Tenant having no
right to assert that the New Premises Commencement Date or Tenant’s other
obligations are affected thereby).  During the Move In Period, neither Tenant
nor any Tenant Parties shall unreasonably delay or otherwise inhibit work being
performed by Landlord or Landlord’s contractors.  Notwithstanding anything in
this Lease to the contrary:  (a) Landlord shall have no responsibility with
respect to any items placed in the New Premises by Tenant or any Tenant Parties
prior to the New Premises Commencement Date; and (b) all of the provisions of
this Lease (including all insurance, indemnity and utility provisions (except,
with respect to utility consumption during the Move-In Period, Tenant shall only
be responsible for excess utilities or utilities used outside of Building
Hours)) shall apply during the Move In Period, except that during such period
(i) Tenant shall not be obligated to pay Base Rent or Tenant’s Share of Direct
Expenses, and (ii) Landlord shall not be obligated to provide any utility,
service or other item in excess of those customarily provided to or for the
benefit of a premises in order for Landlord to perform its building standard
initial improvement work thereto.

 

5.                                      Term for New Premises.  The term (the
“New Premises Term”) for the New Premises shall commence on the New Premises
Commencement Date and shall expire at 11:59 p.m. (local time at the Building) on
the last day of the eighth (8th) Lease Year, subject to the extension option in
Section 15 hereof.  If the New Premises Commencement Date is not the first day
of a month, then the New Premises Term shall be the period set forth in the
previous sentence plus the partial month in which the New Premises Commencement
Date occurs.  Upon the New Premises Commencement Date, the defined terms “Lease
Term” shall include the New Premises Term and the “Lease Expiration Date” shall
mean the last day of the New Premises Term.  As used herein “Lease Year 1” shall
commence on the New Premises Commencement Date and end on the day before the 1st
anniversary of the New Premises Commencement Date; provided, however, that if
the New Premises Commencement Date is not the first day of a month, Lease Year 1
shall be a period set forth above plus the partial month in which the New
Premises Commencement Date has occurred.  Each subsequently Lease Year shall be
consecutive twelve (12) month periods thereafter.

 

3

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

 

6.                                      Base Rent.  Tenant shall pay the
following Base Rent for the New Premises with Lease Year 1 commencing on the New
Premises Commencement Date:

 

Lease Year

 

Percentage

Increase in

Base Rent

 

Annual Base

Rent Per

Square Foot*

 

Annual

Installment*

 

Monthly

Installment

 

 

 

 

 

 

 

 

 

 

 

1

 

 

 

**$78.00

 

**$928,200.00

 

***$77,350.00

 

2

 

3.00

%

$80.34

 

$956,046.00

 

***$79,670.50

 

3

 

3.00

%

$82.75

 

$984,725.00

 

$82,060.42

 

4

 

3.00

%

$85.23

 

$1,014,237.00

 

$84,519.75

 

5

 

3.00

%

$87.79

 

$1,044,701.00

 

$87,058.42

 

6

 

3.00

%

$90.42

 

$1,075,998.00

 

$89,666.50

 

7

 

3.00

%

$93.13

 

$1,108,247.00

 

$92,353.92

 

8

 

3.00

%

$95.92

 

$1,141,448.00

 

$95,120.67

 

 

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

*Based on twelve (12) full calendar months.

 

**During the first six (6) months of the first Lease Year during the New
Premises Term (the “Abatement Period”), the Base Rent shall be abated; provided,
that no default after the applicable notice and cure period set forth in
Section 19.1 of the Lease (an “Event of Default”) exists during such Abatement
Period.  If Tenant cures such Event of Default during the Abatement Period, then
following such cure Tenant’s Base Rent shall continue to be abated as of the
date of such cure; provided, however, that Tenant shall not be entitled to
extend the Abatement Period for the period of time that Tenant was in default
hereunder and shall not be entitled to recoup any portion of Base Rent
attributable to the period of time that such Event of Default was continuing. 
The amounts in the above chart display the annualized and monthly rents due
without accounting for the six (6) months of Base Rent abatement.

 

***Notwithstanding anything to the contrary, for the period beginning on the New
Premises Commencement Date through the Existing Premises Termination Date the
Base Rent payable by Tenant shall be the sum of the applicable Existing Base
Rent (as defined by the chart below) and the applicable Remainder Base Rent (as
defined by the chart below).  The amounts in the below charts display the
annualized and monthly rents due without accounting for the six (6) months of
Base Rent abatement.

 

4

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

 

Existing Base Rent: Tenant shall pay Existing Base Rent for 2,694 rentable
square feet in the New Premises in accordance with the following:

 

Period

 

Annual Base

Rent Per

Square Foot

 

Annual

Installment

 

Monthly

Installment

 

New Premises Commencement Date – 6/30/2018

 

$

61.90

 

$

166,758.60

 

$

13,896.55

 

7/1/2018 – 8/31/2018

 

$

63.76

 

N/A

 

$

14,314.12

 

 

Remainder Base Rent: Tenant shall pay the following Remainder Base Rent for
9,206 rentable square feet in the New Premises:

 

Lease Year

 

Percentage

Increase in 

Base Rent

 

Annual Base 

Rent Per

Square Foot

 

Annual

Installment

 

Monthly

Installment

 

New Premises Commencement Date — End of the 12th month after New Premises
Commencement Date

 

 

 

$

78.00

 

$

718,068.00

 

$

59,839.00

 

 

 

 

 

 

 

 

 

 

 

 

 

 

13 month after New Premises Commencement Date — End of 24th month after New
Premises Commencement Date

 

3.00

%

$

80.34

 

$

739,610.04

 

$

61,634.17

 

 

7.                                      Base Year.  The Base Year for
calculating Tenant’s Share of Direct Expenses for the New Premises shall be the
calendar year 2018.

 

8.                                      Tenant Improvements.  Landlord shall
perform Landlord’s Work on the Premises in accordance with the Work Agreement;
provided that, Landlord shall only be required to provide One Hundred Dollars
($100.00) per square foot of the New Premises towards Landlord’s

 

5

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

 

Work for a maximum liability of One Million One Hundred Ninety Thousand Dollars
($1,190,000.00) (the “Allowance”) and Tenant shall be responsible for all costs
of Landlord’s Work in excess of the Allowance as provided in the Work Agreement.

 

9.                                      Compliance with Law.  Landlord shall be
responsible for delivering the New Premises to Tenant in compliance with all
applicable laws, including, without limitation, the Americans With Disabilities
Act.  In addition, Landlord at its expense (subject to reimbursement pursuant to
Article 4 of the Lease, if and to the extent permitted thereby) shall comply
with all applicable laws to the extent the same apply directly to the Common
Areas of the Building; provided that, if Tenant’s use of the New Premises (other
than for general office use) or Alterations in the New Premises trigger a
compliance with law issue in the Common Area, then Tenant shall be required to
reimburse Landlord for the cost of any work Landlord is required to perform in
the Common Area in order to remedy such compliance issue.   Except as provided
in this Section 9, the Lease shall control the parties’ obligations regarding
compliance with applicable laws.

 

10.                               Landlord’s Recapture Right.  With regards to
the New Premises, Landlord’s recapture right in Section 14.4 of the Lease shall
be limited to Transfers when over fifty percent (50%) of the New Premises is
being transferred.

 

11.                               Access and Services.

 

(a)                                 Current Cost of After-Hours Fan and HVAC. 
As of the date of this Amendment, the current cost for the New Premises of
after-hours ventilation for fan only is Fifty Dollars ($50.00) per hour and the
current cost for after-hours air conditioning is One Hundred Thirty ($130) per
hour.  If Tenant wishes to obtain any after-hour fan or air conditioning, Tenant
should request such after-hour usage at least forty-eight (48) hours in advance.

 

(b)                                 Access.  Tenant shall have access to the
Building and Premises 24 hours a day, 7 days a week, 365 days a year.

 

(c)                                  Security.  Landlord currently contracts
with a third-party security provider to provide security to the Building 24
hours a day, 7 days a week, with a loading dock security guard from 8:00 am to
5:00 pm on business days.  The Building currently has CCTV cameras which are
monitored by the third-party security provided for the Building and card access
systems assist in providing security for the Building.  Landlord shall have the
right at any time to modify the type and level of security being provided to the
Building.  Tenant acknowledges that Landlord is not assuming any liability
pursuant to this Section 11(c) relating to the safety of Tenant’s employees,
guests or personal property and the assumption of liability in Section 10.1 of
the Lease shall continue to govern the liability of the parties.

 

6

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

 

12.                               Signage for New Premises.  Upon the New
Premises Commencement Date, Tenant shall be allowed and provided signage for the
New Premises in accordance with Article 23 of the Lease.

 

13.                               Increase in Security Deposit.  Landlord is
currently holding a Security Deposit in the amount of Twelve Thousand Three
Hundred Forty-Seven and 50/100 Dollars ($12,347.50) under Article 21 of the
Lease as security for Tenant’s obligations relating to the Lease.  The Security
Deposit shall be increased to Eighty-Five Thousand Dollars ($85,000.00) (the
“Increased Security Deposit Amount”) and within ten (10) business days of date
of this Amendment, Tenant shall provide additional funds in order to increase
the cash Security Deposit to the Increased Security Deposit Amount.  At Tenant’s
option, Tenant shall deliver to Landlord a clean, unconditional, irrevocable
letter of credit (the “Letter of Credit”) in lieu of the cash in the amount of
the Increased Security Deposit Amount and upon receipt of the Letter of Credit,
Landlord shall return any cash Security Deposit then held under the Lease. 
After Tenant makes its initial election to provide cash or the Letter of Credit
in the Increased Security Deposit Amount, Tenant shall have no further right to
change the form of security provided for in this Section 13.  The Letter of
Credit shall be:  (a) in form and substance satisfactory to Landlord in its
reasonable discretion (with the following criteria at a minimum); (b) at all
times in the stated face amount of not less than the Increased Security Deposit
Amount, and shall on its face state that multiple and partial draws are
permitted; (c) issued by a commercial bank acceptable to Landlord from time to
time; (d) expressly transferable and assignable one or more times at no charge
to Landlord; (e) payable at sight upon presentment of a sight draft stating only
that Landlord is permitted to draw on the Letter of Credit under the terms of
the Lease and setting forth the amount that Landlord is drawing, which drawing
shall also be permitted via facsimile or email; (f) of a term not less than one
year, and shall on its face state that the same shall be renewed automatically,
without the need for any further written notice or amendment, for successive
minimum one year periods, unless the issuer notifies Landlord in writing, at
least thirty (30) days prior to the expiration date thereof, that such issuer
has elected not to renew the Letter of Credit (which will thereafter entitle
Landlord to draw on the Letter of Credit); and (g) at least thirty (30) days
prior to the then current expiration date of such Letter of Credit, either
(1) renewed (or automatically and unconditionally extended) from time to time
through the ninetieth (90th) day after the expiration of the Lease Term, or
(2) replaced by Tenant with cash, or another Letter of Credit meeting the
requirements of this Section, in the full amount of the Increased Security
Deposit Amount.  Within five (5) business days after Tenant becomes aware of any
partial draw on the Letter of Credit by Landlord, Tenant shall provide Landlord
with an amendment to the original Letter of Credit or a new Letter of Credit
meeting the requirements of this Section 13 which amendment or new Letter of
Credit results in Landlord once again holding Letter of Credit(s) in the full
Security Deposit Amount, and in the event Landlord does not receive such
amendment or new Letter of Credit reinstating the full Security Deposit Amount,
Landlord shall have the right, but not the obligation, to immediately draw on
the remainder of the Letter of Credit and apply the proceeds to a cash security
deposit pursuant this Section 13 and Article 21 of the Lease (it being
understood that the total security deposit on hand, whether in cash or Letter of
Credit form, shall at all times be not less than the total Increased Security
Deposit Amount as so defined).  Tenant shall cooperate with Landlord to effect
any modifications, transfers or replacements of the Letter of Credit requested
by Landlord in order to

 

7

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

 

assure that Landlord is at all times fully secured by a valid Letter of Credit
that may be drawn upon by Landlord, its successors and assigns.  Notwithstanding
anything in this Lease to the contrary, any cure or grace period provided in
connection with an Event of Default shall not apply to any of the foregoing
requirements of the Letter of Credit, and, specifically, if any of the aforesaid
requirements are not complied with timely, then an immediate Event of Default
shall occur and Landlord shall have the right to immediately draw upon the
Letter of Credit without notice to Tenant and apply the proceeds to the security
deposit.  Each Letter of Credit shall be issued by a commercial bank that has a
credit rating with respect to certificates of deposit, short term deposits or
commercial paper of at least A-2 (or equivalent) by Moody’s Investor
Service, Inc., or at least P-2 (or equivalent) by Standard & Poor’s Corporation,
and shall be otherwise acceptable to Landlord in its sole and absolute
discretion.  If the issuer’s credit rating is reduced below A-2 (or equivalent)
by Moody’s Investors Service, Inc. or below P-2 (or equivalent) by Standard &
Poor’s Corporation, or if the financial condition of such issuer changes in any
other materially adverse way, then Landlord shall have the right to require that
Tenant obtain from a different issuer a substitute Letter of Credit that
complies in all respects with the requirements of this Section, and Tenant’s
failure to obtain such substitute Letter of Credit within ten (10) days
following Landlord’s written demand therefor (with no other notice or cure or
grace period being applicable thereto, notwithstanding anything in this Lease to
the contrary) shall entitle Landlord to immediately draw upon the then existing
Letter of Credit in whole or in part, without notice to Tenant.  In the event
the issuer of any Letter of Credit held by Landlord is insolvent or is placed
into receivership or conservatorship by the Federal Deposit Insurance
Corporation, or any successor or similar entity, or if a trustee, receiver or
liquidator is appointed for the issuer, then, effective as of the date of such
occurrence, said Letter of Credit shall be deemed to not meet the requirements
of this Section, and, within ten (10) days thereof, Tenant shall replace such
Letter of Credit with other collateral acceptable to Landlord in its sole and
absolute discretion (and Tenant’s failure to do so shall, notwithstanding
anything in this Lease to the contrary, constitute an Event of Default for which
there shall be no notice or grace or cure periods being applicable thereto other
than the aforesaid ten (10) day period).  Any failure or refusal of the issuer
to honor the Letter of Credit shall be at Tenant’s sole risk and shall not
relieve Tenant of its obligations hereunder with respect to the security
deposit.  Landlord hereby approves Citizens Bank as an issuer of the Letter of
Credit; provided that all times Citizens Bank maintains a branch in New York
able to process draw requests under the Letter of Credit or that Citizens Bank
allows for draw requests to be permitted via facsimile or email by Landlord.

 

14.                               Right of First Offer on Suites 1600 and 1630. 
Subject to any existing rights identified on Exhibit C attached hereto held by
tenants in the Building as of the date of this Amendment, during the Lease Term,
Tenant shall have a one-time right of first offer (“ROFO Right”) with respect to
any space that becomes available on the sixteenth (16th) floor of the Building
from time to time (the “Reserved Area”), subject to and in accordance with the
terms and conditions of this Section 14.  The lease term for the Reserved Area
pursuant to Tenant’s exercise of such ROFO Right shall commence only following
the expiration or earlier termination of any existing lease pertaining to the
Reserved Area (collectively, the “Superior Leases”), including any renewal or
extension of any such Superior Lease (but only for such Superior Leases that
provide the tenant of such leases with an express written provision to extend
the term), whether or not such renewal or extension is pursuant to such express
written provision

 

8

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

 

in such Superior Lease, and regardless of whether any such renewal or extension
is consummated pursuant to a lease amendment or a new lease.  Landlord shall
only be required to offer space within the Reserved Area once to Tenant pursuant
to this Section 14, but any remaining unoffered space within the Reserved Area
shall remain subject to Tenant’s rights under this Section 14.

 

(a)                                 Procedure for Offer.  During the Lease Term,
Tenant will notify Landlord that it wishes to expand the New Premises.  Within
fifteen (15) business days after receipt of Tenant’s notice, Landlord shall
promptly deliver to Tenant written notice (the “ROFO Notice”) if any portion of
the Reserved Area will become or is expected to become available for lease to
third parties from time to time, except Landlord shall only be required to
provide one ROFO Notice with regards to each portion of the Reserved Area.  The
ROFO Notice shall describe the space so offered to Tenant, including the
rentable square feet thereof (the “ROFO Space”) and shall set forth all of
Landlord’s proposed terms and conditions (including economic terms, which
economic terms shall be consistent with Market Rent (as hereinafter defined))
applicable to Tenant’s lease of such space (collectively, the “ROFO Terms”),
except if the ROFO Space becomes available prior to the first (1st) anniversary
of the New Premises Commencement Date, then the ROFO Terms shall be the same as
those for the New Premises set forth in this Amendment.

 

(b)                                 Procedure for Acceptance.  If Tenant wishes
to exercise Tenant’s ROFO Right with respect to the ROFO Space described in the
ROFO Notice, then within ten (10) Business Days after receipt of the ROFO Notice
by Tenant, Tenant shall deliver notice to Landlord of Tenant’s exercise of its
ROFO Right with respect to the entire ROFO Space described in the ROFO Notice
and on the ROFO Terms contained therein.  If Tenant does not exercise its ROFO
Right within the ten (10) Business Day period (on all of the ROFO Terms), then
Landlord shall be free to lease the space described in the ROFO Notice to anyone
to whom Landlord desires and Tenant’s ROFO Right shall thereupon automatically
terminate and Tenant shall have no further rights under this Section 14. 
Notwithstanding anything to the contrary contained herein, Tenant must elect to
exercise its ROFO Right, if at all, with respect to all of the space comprising
the ROFO Space offered by Landlord to Tenant in a ROFO Notice, and Tenant may
not elect to lease only a portion thereof or object to any of the ROFO Terms.

 

(c)                                  Construction of the ROFO Space.  Except as
otherwise provided in the ROFO Terms, Tenant shall take the ROFO Space in its
“AS-IS” condition, and Tenant shall be entitled to construct improvements in the
ROFO Space in accordance with and subject to the provisions of Article 8 of the
Lease.

 

(d)                                 Lease of the ROFO Space.  If Tenant timely
exercises Tenant’s right to lease the ROFO Space as set forth herein, Landlord
and Tenant shall

 

9

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

 

execute an amendment adding such ROFO Space to the New Premises under this Lease
(as amended by this Amendment) upon the ROFO Terms set forth in Landlord’s ROFO
Notice, and upon the same non-economic terms and conditions as applicable to the
New Premises (the “ROFO Amendment”).  The lease term for the ROFO Space shall,
unless otherwise provided in the ROFO Notice as part of the ROFO Terms, expire
conterminously with the Lease Term for the New Premises.

 

(e)                                  No Events of Defaults.  The rights
contained in this Section 14 shall be personal to CRA International, Inc. or an
affiliate of CRA International, Inc. that the Lease is assigned to under
Section 14.8 of the Lease (a “CRA “Affiliate”) or any successor to CRA
International, Inc. by merger or acquisition which becomes Tenant under this
Lease in accordance with the requirements of Section 14 of this Lease (a “CRA
Successor”), and may only be exercised by CRA International, Inc. or any such
CRA Affiliate or CRA Successor (and not any other assignee, sublessee or other
transferee of CRA International, Inc.’s interest in the Lease) if CRA
International, Inc. or any CRA Affiliate or CRA Successor occupies the entire
Premises as of the date Tenant exercises the ROFO Right.  In addition, at
Landlord’s option and in addition to Landlord’s other remedies set forth in the
Lease, at law and/or in equity, Tenant shall not have the right to lease the
ROFO Space as provided in this Section 14 if, as of the date of the ROFO Notice,
or, at Landlord’s option, as of the scheduled date of delivery of such ROFO
Space to Tenant, an uncured Event of Default exists under the Lease.

 

15.                               Option to Extend.

 

(a)                                 If Tenant expands the New Premises and is
leasing the entire sixteenth (16th) floor of the Building, then subject to the
provisions hereinafter set forth, Landlord hereby grants to Tenant
one (1) option to extend the Lease Term, for a period of five (5) years (the
“Renewal Period”) after the expiration of the initial Lease Term.  The Renewal
Period, if any, shall commence on the day after the Lease Expiration Date and
end on the fifth (5th) anniversary of such Lease Expiration Date.  The option
shall be exercisable by written notice (the “Renewal Notice”) from Tenant to
Landlord given not earlier than eighteen (18) months or later than twelve (12)
months prior to the end of the Lease Term as then in effect.  If an option is
not so exercised, said option shall thereupon expire.  Tenant may only exercise
an option, and an exercise thereof shall only be effective, if (i) at the time
of Tenant’s exercise of said option and, at Landlord’s option, at the
commencement of the Renewal Period, this Lease is in full force and effect and
Tenant is not in monetary default under this Lease beyond any applicable notice
and cure period, and (ii) inasmuch as said option is intended only for the
benefit of the original Tenant named in this Lease and a CRA Affiliate and CRA
Successor, Tenant has not assigned this Lease or sublet more than thirty percent
(30%) of the Premises on a square footage basis other than to a CRA Affiliate or
CRA Successor at the time of Tenant’s exercise of such option and, at Landlord’s

 

10

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

 

option, at the commencement of the Renewal Period.  Without limitation of the
foregoing, no sublessee or assignee shall be entitled to exercise said option
and, at the option of Landlord, no exercise of said option by the original
Tenant named herein shall be effective, in the event said Tenant assigns this
Lease or subleases all or more than thirty percent (30%) of the Premises prior
to the Lease Expiration Date other than to a CRA Affiliate or CRA Successor.

 

(b)                                 The Base Rent payable during the Renewal
Period shall be equal to the Market Rent (as hereinafter defined) as of the
commencement of the Renewal Term.  “Market Rent” shall mean the base rent at
which tenants are leasing Class A office buildings in San Francisco, California,
vacant non-sublease, non-encumbered, non-equity space, for a comparable lease
term and otherwise upon the terms applicable to the lease of the Premises under
this Lease, in an arm’s length transaction involving buildings which are
comparable to the Building in terms of quality, age, and existing build-out,
with tenants which are comparable to Tenant in terms of size, credit quality and
stature.  Landlord shall give Tenant written notice of the Market Rent,
including yearly escalations, within thirty (30) days following written request
by Tenant but not earlier than twelve (12) months prior to the commencement of
the Renewal Period.  If Tenant disagrees with Landlord’s determination of the
Market Rent, Tenant shall notify Landlord of such disagreement within ten
(10) days after receipt of Landlord’s determination of the Market Rent.  If
Tenant fails to so notify Landlord of Tenant’s disagreement within the required
time period, Landlord’s determination of the Market Rent shall be binding on
Tenant.  If Tenant so notifies Landlord that Landlord’s determination of the
Market Rent is not acceptable to Tenant, Landlord and Tenant shall, during the
fifteen (15) day period after Tenant’s notice (the “Negotiation Period”),
attempt to agree on the Market Rent.  If Landlord and Tenant are unable to
agree, the Market Rate shall be determined by binding arbitration as follows:

 

(i)                                     Landlord and Tenant each shall appoint a
real estate appraiser who has been active over the ten (10) year period ending
in the date of the appointment in the leasing of similar buildings in San
Francisco, California and shall be a member in good standing of the Appraisal
Institute (or successor organization) with the designation “MAI” (the “Appraiser
Qualifications”)  Within twenty (20) business days after their appointment, such
appraisers shall complete their appraisals of the Market Rent for the Renewal
Period and submit their appraisal reports to Landlord and Tenant.  If the fair
market monthly Market Rent established in the two (2) appraisals varies by five
percent (5%) or less of the higher rental, the average of the two shall be
controlling.

 

(ii)                                  If said estimate of Market Rent varies by
more than five percent (5%) of the higher rental, said appraisers, within ten
(10) days after submission of the last appraisal, shall appoint a third
appraiser who

 

11

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

 

meets the Appraiser Qualifications.  Such third appraiser shall, within twenty
(20) business days after his or her appointment, determine whether the Market
Rent determined by Landlord’s appraiser or Tenant’s appraiser for the Premises
is the closest to the actual Market Rent for the Premises for the Renewal
Period.  Whichever of the original appraisals is determined by the third
arbitrator to be closest to such actual Market Rent shall be the Market Rent for
the Premises for the Renewal Period.

 

(iii)                               If either Landlord or Tenant fails to
appoint an appraiser, or if an appraiser appointed by either of them fails,
after his appointment, to submit his appraisal within the required period in
accordance with the foregoing, the appraisal submitted by the appraiser properly
appointed and timely submitting his appraisal shall be controlling.  If the two
appraisers appointed by Landlord and Tenant are unable to agree upon a third
appraiser within the required period in accordance with the foregoing,
application shall be made within twenty (20) days thereafter by either Landlord
or Tenant to the Appraisal Institute, which shall appoint a member of said
institute willing to serve as appraiser.  Each party shall pay the cost of their
own appraiser and the cost of the third appraiser shall be borne equally by
Landlord and Tenant.  The decision of the appraisers shall be final and binding
upon Landlord and Tenant.

 

(c)                                  If Tenant has validly exercised the option
to extend the Lease Term, within thirty (30) days after the Market Rent is
determined, Landlord and Tenant shall enter into a written amendment to this
Lease confirming the terms, conditions and provisions applicable to the Renewal
Period, as determined in accordance herewith.  Tenant’s failure to timely
execute such amendment shall not negate the irrevocable nature of Tenant’s
exercise of its option.

 

(d)                                 Tenant shall not have any option to extend
the terms of this Lease beyond the expiration of the Renewal Period.  The
Renewal Period shall be on the same terms and conditions set forth herein,
except that (i) no concessions, abatements or allowances granted with respect to
the initial Lease Term, if any, shall be applicable to the Renewal Period,
(ii) Base Rent shall be equal to the Market Rent, determined as set forth above,
and (iii) Tenant shall not have any right to renew or extend the Lease Term
after the end of the Renewal Period.

 

16.                               Terrace.  Tenant shall have the right to use,
on a non-exclusive basis and in common with others, the furnished terrace on the
fourth (4th) floor of the Building (the “Terrace”) subject to Tenant abiding by
such rules and regulations as Landlord shall from time to time impose, which
Terrace shall, for purposes of this Lease, be deemed to be Common Areas. 
Landlord shall provide to Tenant free access to wireless internet on the
Terrace.  Tenant may use the Terrace after hours subject to approval from the
Landlord and may be charged a fee in connection with such use.

 

12

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

 

(a)                                 The Terrace shall be used by Tenant in a
manner consistent with a first-class office project containing terraces, on the
terms and conditions set forth herein.  Tenant shall not make any improvements
or alterations to the Terrace, nor shall Tenant be permitted to install or place
on the Terrace any furniture, fixtures, plants or other items of any kind
whatsoever.  Tenant shall not be permitted to display any graphics, signs or
insignias or similar such items on the Terrace. Landlord shall have the right to
temporarily close, or limit access to, the Terrace from time to time in
connection with Terrace or Building repairs and/or for other reasonable
purposes.

 

(b)                                 Tenant acknowledges and agrees that
(i) Tenant shall be responsible for supervising and controlling access to the
Terrace by Tenant’s employees, officers, directors, shareholders, agents,
representatives, contractors and/or invitees (the “Terrace Users”);
(ii) Landlord is not responsible for supervising and controlling access to the
Terrace; and (iii) Tenant assumes the risk for any loss, claim, damage or
liability arising out of the use or misuse of the Terrace by Tenant’s Terrace
Users, and Tenant releases and discharges Landlord from and against any such
losses, claim, damage or liability.  Tenant further agrees to indemnify, defend
and hold Landlord and Landlord’s Representatives harmless from and against any
and all losses and claims relating to or arising out of the use or misuse of the
Terrace by Tenant or Tenant’s Terrace Users.

 

(c)                                  Tenant further acknowledges and agrees that
other tenants’ Terrace Users may or shall have access to the Terrace and that
Landlord shall have no liability or responsibility to monitor the use, or manner
of use, thereof by Tenant’s or any other tenants’ Terrace Users. 
Notwithstanding the foregoing, Tenant shall at all times cooperate on a
commercially reasonable basis with any other Terrace Users in order to avoid
conflict with such users.

 

17.                               Conference Center and Tenant Lounge.  Tenant
shall have access to the building conference center and tenant lounge on the
fourth (4th) floor of the Building (the “Conference Center and Tenant Lounge”)
subject to such rules and regulations as Landlord shall from time to time
impose.  Access to the Conference Center and Tenant Lounge is subject to
Landlord’s sole and absolute approval and such approved access shall be limited
to Building tenants exclusively.  Tenant may reserve the conference room through
the building management office and, Tenant may be charged a fee in connection
with use of the Conference Center and Tenant Lounge.  Tenant acknowledges and
agrees that other tenants may or shall have access to the Conference Center and
Tenant Lounge and that Landlord shall have no liability or responsibility to
monitor the use, or manner of use, thereof by Tenant or any other tenants. 
Notwithstanding the foregoing, Tenant shall at all times cooperate on a
commercially reasonable basis with any other tenants using the Conference Center
and Tenant Lounge in order to avoid conflict with such users.

 

13

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

 

18.                               ACM.  Tenant acknowledges and agrees that
(a) the Project was constructed at a time when asbestos was commonly used in
construction, (b) asbestos and asbestos-containing materials (collectively,
“ACM”) may be present at the Project, and (c) airborne asbestos fibers may be
released and result in a potential health hazard if proper ACM containment,
remediation and abatement procedures are not observed.  Except as otherwise
provided in the Lease and the Work Agreement, Tenant shall be solely responsible
for all costs related to ACM that arise in connection with Tenant’s occupancy,
use, modification, alteration or improvement of the then Premises under this
Lease.  In connection with any modifications, alterations or improvements
contemplated to be performed by Tenant in the Premises, Tenant (including its
contractors and other agents) shall consult with Landlord and Landlord’s
asbestos consultant concerning appropriate procedures to be followed in
connection with ACM prior to performing any such work in the Premises.  All such
work shall be subject to the terms of Article 8 of the Lease.  During the
performance of any such work, Tenant (including its contractors and other
agents) shall comply with all applicable laws, rules, regulations and other
governmental requirements, as well as all directives of Landlord and Landlord’s
asbestos consultant, relating to ACM.  Landlord’s consultant shall have the
right but not the obligation to supervise and direct any ACM-related aspects of
Tenant’s contemplated work in the Premises.  In connection with any such work
that may affect ACM in the Premises or the Project, Landlord shall have the
right at any time to cause Tenant to immediately stop such work if such work has
not been approved in writing by Landlord or if such work has deviated from the
plans previously approved by Landlord for such work.

 

19.                               Substitution of Other Premises.  Landlord
agrees for purposes of Article 22 of the Lease that other space in the Building
comparable to the Premises must be located on the 12th floor or above of the
Building.

 

20.                               CASp.  For purposes of Section 1938(a) of the
California Civil Code, Landlord hereby discloses to Tenant, and Tenant hereby
acknowledges, that neither the Building nor the Existing Premises or the New
Premises have undergone inspection by a Certified Access Specialist (“CASp”)
(defined by California Civil Code Section 55.52).  Pursuant to California Civil
Code Section 1938, Tenant is hereby notified that a CASp can inspect the then
Premises under the Lease and determine whether the Premises complies with all of
the applicable construction-related accessibility standards under state law. 
Although state law does not require a CASp inspection of the Premises, Landlord
may not prohibit Tenant from obtaining a CASp inspection of what then comprises
Premises for the occupancy of the Tenant, if requested by Tenant.  Landlord and
Tenant shall mutually agree on the arrangements for the time and manner of any
CASp inspection, the payment of the fee for the CASp inspection and the cost of
making any repairs necessary to correct violations of construction-related
accessibility standards within the Premises then covered by the Lease.  If
Tenant requests to perform a CASp inspection of the Premises, Tenant shall, at
its cost, retain a CASp approved by Landlord (provided that Landlord may
designate the CASp, at Landlord’s option) to perform the inspection of the
Premises at a time agreed upon by the parties.  Tenant shall provide Landlord
with a copy of any report or certificate issued by the CASp (the “CASp
Report”).  Landlord and Tenant agree that any modifications necessary to correct
violations of construction related accessibility standards identified in the
CASp Report shall be the responsibility of the party expressly provided for in

 

14

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

 

the Lease, including, but not limited to Section 9 of this Amendment and
Article 24 of the Lease.  Tenant agrees to keep the information in the CASp
Report confidential except as necessary for the Tenant to complete such
modifications.

 

21.                               Surrender of Existing Premises.  Tenant shall
surrender the Existing Premises to Landlord in accordance with the terms and
conditions for surrender of the Existing Premises set forth in the Lease;
provided, Tenant must surrender the Existing Premises to Landlord within five
(5) days after the New Premises Commencement Date.  The date on which Tenant
surrenders the Existing Premises to Landlord in accordance with the preceding
sentence shall be referred to herein as the “Surrender Date for Existing
Premises.”  Tenant’s obligation to pay rent with respect to the Existing
Premises (including, without limitation, Base Rent and Tenant’s Share of Direct
Expenses) shall cease upon the New Premises Commencement Date if Tenant
surrenders the Existing Premises within five (5) days after the New Premises
Commencement Date (and if Tenant does not surrender the Existing premises by
such date, then Tenant shall pay Base Rent and Tenant’s Share of Direct Expenses
on the Existing Premises from such date to the actual Surrender Date for the
Existing Premises), except for any reconciliation of the actual Direct Expenses
against the estimated payments made by Tenant for the period prior to the
Surrender Date for the Existing Premises.

 

22.                               Parking.  Section 29.32 of the Lease is hereby
amended and replaced in its entirety by the following:

 

29.32                 Parking.  During the Lease Term, Tenant and its employees,
visitors and other invitees shall not be entitled to use any parking spaces in
the parking facilities serving the Building (the “Parking Facilities”) unless
Tenant and Landlord agree in writing that Tenant shall be allowed to use any
parking spaces at Landlord’s monthly rate for such parking spaces (which as of
the date of this Amendment is $425 per month per space). Tenant shall not use
the Parking Facilities for the servicing or extended storage of vehicles. 
Tenant shall not assign, sublet or transfer any permits hereunder, except in
connection with any assignment or sublease permitted pursuant to Article 14
hereof where parking is provided for in the sublease or assignment.  Landlord
reserves the right to institute either a Parking Facilities operator system,
which may include self-park, attendant-park, valet or other parking
arrangements, or to otherwise change the parking system.  Tenant and its
employees shall observe reasonable safety precautions in the use of the Parking
Facilities or any other parking area and shall at all times abide by all
rules and regulations governing the use of the Parking Facilities.  Tenant
acknowledges that particular parking facilities, areas or spaces may designated
for exclusive use by particular tenants, occupants, visitors or other users,
either generally or at particular times, and Tenant shall comply with all such
designations and cause its employees, visitors and other invitees to do the
same.  Landlord reserves the right to close the Parking Facilities or any other
parking area during periods of unusually inclement weather or for alterations,
improvements or repairs.  Landlord does not assume any responsibility, and shall
not be held liable, for any damage or loss to any automobile or personal
property

 

15

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

 

in or about the Parking Facilities, or for any injury sustained by any person in
or about the Parking Facilities.  Landlord shall not be liable to Tenant and
this Lease shall not be affected if any parking rights hereunder are impaired by
any Law imposed after the date of this Amendment.  Landlord reserves the right
to determine whether the Parking Facilities are becoming crowded and to allocate
and assign parking spaces among Tenant and the other tenants.  It is understood
and agreed that Landlord assumes no responsibility, and shall not be held
liable, for any damage or loss to any automobiles parked in the Parking
Facilities or to any personal property located therein, or for any injury
sustained by any person in or about the Parking Facilities.

 

23.                               Bicycle Parking.  Tenant shall have the right
to bicycle parking in accordance with the current rules and regulations for the
Building set forth on Exhibit D attached hereto.

 

24.                               Tenant’s Notice Address.  Tenant’s notice
address for the Lease is:  CRA International, Inc., 200 Clarendon Street,
Boston, MA 02116, Attention:  Maxine Jacobs.

 

25.                               Landlord Notice Address.  Landlord’s notice
address for the Lease is:  Columbia REIT — 221 Main, LLC, c/o Columbia Property
Trust, 650 California Street, Suite 200, San Francisco, California 94108,
Attention:  Asset Manager of West Region.

 

26.                               Landlord Payment Address.  Payments to
Landlord under the Lease should be sent as follows:

 

Via Mail
Columbia REIT — 221 Main, LLC
P.O. Box 101549
Pasadena, CA 91189-1549

 

Via Overnight Delivery
JPMorgan Chase
2710 Media Center Drive, Building 6, Suite# 120
Los Angeles, CA 90065
Attn:                    Columbia REIT — 221 Main, LLC

 

Via Wire
Bank Name — J.P. Morgan Chase
Bank Address — NY, NY 10004
ABA #021000021
Account Name — Columbia REIT — 221 Main, LLC
Account #- 595 195 210
REF:  221 Main

 

At Landlord’s option upon at least thirty (30) days written notice, Tenant shall
make all payments by means of electronic transfer of funds or in such other
manner as Landlord may from time to time specify in writing.

 

16

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

 

27.                               Brokers.  Landlord and Tenant hereby warrant
to each other that they have had no dealings with any real estate broker or
agent in connection with the negotiation of this Lease, excepting only Jones
Lang LaSalle (“Landlord’s Broker”) that has acted as Landlord’s broker and
Colton Commercial & Partners, Inc. (“Tenant’s Broker” and collectively, with
Landlord’s Broker, as the “Brokers”) that has acted as Tenant’s broker on this
Amendment.  Except for the Brokers, Landlord and Tenant know of no other real
estate broker or agent who is entitled to a commission in connection with this
Lease.  Landlord shall pay any commission due Landlord’s Broker pursuant to a
separate agreement between Landlord’s Broker and Landlord.  Landlord shall pay a
commission to Tenant’s Broker pursuant to a separate agreement with Tenant’s
Broker and Landlord.  Each party agrees to indemnify and defend the other party
against and hold the other party harmless from any and all claims, demands,
losses, liabilities, lawsuits, judgments, costs and expenses (including without
limitation reasonable attorneys’ fees) with respect to any leasing commission or
equivalent compensation alleged to be owing on account of any dealings with any
real estate broker or agent, other than Brokers, occurring by, through, or under
the indemnifying party.

 

28.                               Ratification of Lease Terms.  Notwithstanding
any term or provision of the Lease, the provisions of this Amendment shall
amend, modify and supersede the terms of the Lease.  If there is any conflict
between the Lease and this Amendment, this Amendment shall control.  All other
non-conflicting terms, provisions, covenants and conditions of the Lease and all
exhibits and addendum thereto shall continue in full force and effect and are
hereby ratified by the parties hereto.

 

29.                               Entire Agreement.  This Amendment sets forth
the entire understanding of the parties in connection with the subject matter
hereof.  There are no agreements between Landlord and Tenant relating to the
Lease or the Premises other than those set forth in writing and signed by the
parties.  Neither party hereto has relied upon any understanding, representation
or warranty not set forth herein, either oral or written, as an inducement to
enter into this Amendment.

 

30.                               Binding Effect.  This Amendment shall be
binding upon the parties and their respective successors and assigns.

 

31.                               Governing Law.  This Amendment and all actions
arising out of or in connection with this Amendment shall be governed by and
construed in accordance with the laws of the State of California, without regard
to conflict of law provisions.

 

32.                               Authority.  Each of the individuals executing
this Amendment on behalf of a party individually represents and warrants that he
or she has been authorized to do so and has the power to bind the party for whom
they are signing.  Landlord represents and warrants that no consent or approval
of any third party is required for Landlord to enter into this Amendment under
any agreement or instrument by which Landlord is bound.

 

17

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

 

33.                               Counterparts.  This Amendment may be executed
in any number of identical counterparts, each of which shall be deemed to be an
original, and all of which together shall be deemed to be one and the same
instrument when each party has signed one such counterpart.  Counterparts may be
delivered via facsimile, electronic mail (including pdf or any electronic
signature complying with the U.S. federal ESIGN Act of 2000, e.g.,
www.docusign.com) or other transmission method and any counterpart so delivered
shall be deemed to have been duly and validly delivered and be valid and
effective for all purposes.

 

[Signatures on Next Page]

 

18

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

 

IN WITNESS WHEREOF, this Amendment is made as of the day and year first above
written.

 

 

 

LANDLORD:

 

 

 

 

 

COLUMBIA REIT- 221 MAIN, LLC,

 

 

a Delaware limited liability company

 

 

 

 

 

By:

COLUMBIA PROPERTY TRUST OPERATING PARTNERSHIP, L.P.,

 

 

 

a Delaware limited partnership,

 

 

 

its sole member

 

 

 

 

 

 

 

By:

COLUMBIA PROPERTY TRUST INC.,

 

 

 

 

a Maryland corporation,

 

 

 

 

its general partner

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

By:

/s/ David Dowdney

 

 

 

 

Name:

David Dowdney

 

 

 

 

Title:

SVP

 

 

 

 

 

 

 

 

TENANT:

 

 

 

 

 

CRA INTERNATIONAL, INC.,

 

 

a Massachusetts corporation

 

 

 

 

 

 

 

 

By:

/s/ Chad M. Holmes

 

 

Name:

Chad M. Holmes

 

 

Title:

CFO

 

19

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

 

EXHIBIT A FLOOR PLAN OF NEW PREJ:...ITSES NEW PREMISES • A-1

[g206073ko35i001.gif]

 

 

EXHIBIT B

 

WORK AGREEMENT

 

This Exhibit is attached to and made a part of that certain First Amendment to
Lease (the “Amendment”) to which this Exhibit is attached.  Terms used but not
defined in this Exhibit shall have the meaning ascribed to them in the Amendment
and if not defined in the Amendment, then in the Lease.

 

1.             Tenant’s Authorized Representative.  Tenant designates Maxine
Jacobs (“Tenant’s Authorized Representative”) as the person authorized to
approve all budgets, plans, drawings and change orders pursuant to this
Exhibit.  Landlord shall not be obligated to respond to or act upon any such
item until such item has been approved in writing by Tenant’s Authorized
Representative.

 

2.             Landlord’s Work.  Landlord, through its independent designated
contractor, shall install in the New Premises those initial improvements
specified in the Approved Space Plan and Final Construction Drawings including
any work required to comply with any and all building codes and regulations
governing such improvements (collectively with any subsequent modifications or
additions, “Landlord’s Work”).  Landlord shall obtain competitive bids,
solicited from at least three (3) general contractors to perform Landlord’s work
and Landlord shall select the general contractor (the “General Contractor”)
perform Landlord’s Work based on such competitive bids.  Landlord shall not be
obligated to provide any improvements, and the New Premises shall be delivered
containing no property of any kind, other than Landlord’s Work.  Tenant shall
pay all costs and expenses (including a construction management fee in the
amount of five percent (5%) of the total cost of the initial buildout), incurred
in connection with Landlord’s Work to the extent such costs and expenses exceed
an allowance (the “Allowance”) equal to One Hundred Dollars ($100.00) per square
foot of the New Premises towards Landlord’s Work for a maximum Allowance of One
Million One Hundred Ninety Thousand Dollars ($1,190,000.00).  Tenant shall pay
fifty percent (50%) of Landlord’s reasonable estimate of those costs and
expenses (if any) which exceed the Allowance on or before the tenth (10th) day
after the date Landlord gives Tenant notice of Landlord’s contractor’s estimate
of such expenses.  Tenant shall pay the remainder of such estimate within ten
(10) days after Tenant’s receipt of a notice stating that Landlord’s Work are
fifty percent (50%) complete, as reasonably determined by Landlord.  Tenant
shall pay the remainder of the actual costs and expenses in excess of the
Allowance when Landlord’s Work is substantially complete and Tenant receives a
bill therefor along with reasonably satisfactory backup documentation evidencing
such costs and expenses.  Tenant shall pay such bill, if any, within thirty (30)
days after Tenant’s receipt thereof and such backup information.  All amounts
payable pursuant to this Exhibit by Tenant shall be considered additional rent
and are subject to the provisions of the Lease.

 

4.             Schedule.

 

(a)           Landlord and Tenant have approved the space plan attached hereto
as Exhibit B-1 (the “Approved Space Plan”).

 

B-1

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

 

(b)           Based upon the Approved Space Plan, Landlord and Tenant have
approved the complete architectural plans for Landlord’s Work attached hereto as
Exhibit B-2 (the “Final Construction Drawings”).

 

(c)           Based upon the Final Construction Drawings, Landlord has provided
Tenant with an estimate (the “Construction Pricing Proposal”) of the cost of all
items in connection with the performance of Landlord’s Work pursuant to the
Final Construction Drawings and Tenant has approved the Construction Pricing
Proposal.  The Construction Pricing Proposal is attached hereto as Exhibit B-3.

 

5.             Approval.  Landlord’s approval of the Approved Space Plan and the
Final Construction Drawings shall not constitute Landlord’s representation that
such approved plans, drawings or changes comply with all Laws. Any deficiency in
design or construction, although same had prior approval of Landlord, shall be
solely the responsibility of Tenant.

 

6.             Change Orders.  All additional expenses attributable to any
change order requested by Tenant and approved by Landlord shall be payable by
Tenant prior to the performance of the work contemplated by such change order. 
If Landlord submits an estimate of the additional expenses attributable to a
change order, then Tenant shall pay such estimated additional expenses prior to
the performance of the work contemplated by such change order if the additional
expenses result in the net cost of Landlord’s Work to exceed the Allowance.  If
the actual additional expenses attributable to such change order exceed such
estimated additional expenses, then Tenant shall pay the amount of such excess
within thirty (30) days after Tenant’s receipt of a bill therefor.  If such
estimated additional expenses exceed the actual additional expenses attributable
to such change order, then the amount of such excess shall be credited against
the first installment(s) of rent.

 

7.             Substantial Completion.  Except as provided in Paragraph 6(b),
the New Premises shall be deemed to be ready for occupancy when all work and
materials to be provided by Landlord pursuant to this Exhibit, have been
substantially completed (except for items of work and adjustment of equipment
and fixtures that can be completed after the New Premises are occupied without
causing substantial interference with Tenant’s use of the New Premises (i.e.,
the “punch list” items)), as reasonably determined by Landlord’s architect in
its professional judgment (“Substantial Completion” or “Substantially
Completed”).  Architect shall provide a written certification of such
Substantial Completion to Landlord and Tenant.

 

8.             Possession.  Tenant’s taking of possession of the New Premises
shall constitute Tenant’s acknowledgment that the New Premises are in good
condition and that all work and materials are satisfactory, except as to any
defect or incomplete work relating to Landlord’s Work that is readily
identifiable from a walkthrough of the New Premises and is described in a
written notice given by Tenant to Landlord not later than the day Tenant takes
possession of the New Premises.  The foregoing acceptance, however, shall not be
deemed or construed as limiting any of Landlord’s representations or other
obligations under the Lease.  Landlord will correct and complete those defects
and incomplete items described in such notice, which Landlord confirms

 

B-2

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

 

are in fact defects or incomplete items.  Tenant shall accompany Landlord to
prepare the punch list on or before the date Tenant takes possession of the
Premises.

 

 

Initials of:

 

 

 

Landlord:

DD

 

 

 

 

Tenant:

CMH

 

B-3

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

 

EXHIBIT B-1

 

TENANT’S SPACE PLAN

 

[SEE ATTACHED]

 

B-1-1

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

 

B-1-2

[g206073ko41i001.gif]

 

 

EXHIBIT B-2

 

FINAL CONSTRUCTION DRAWINGS

 

[SEE ATTACHED]

 

B-2-1

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

 

 

[g206073ko45i001.gif]

 

 

[g206073ko45i002.gif]

 

 

[g206073ko45i003.gif]

 

 

 

[g206073ko45i004.gif]

 

 

[g206073ko45i005.gif]

 

 

 

[g206073ko47i001.gif]

 

 

[g206073ko47i002.gif]

 

 

[g206073ko47i003.gif]

 

 

[g206073ko47i004.gif]

 

 

[g206073ko47i005.gif]

 

 

 

[g206073ko49i001.gif]

 

 

[g206073ko49i002.gif]

 

 

[g206073ko49i003.gif]

 

 

[g206073ko49i004.gif]

 

 

[g206073ko49i005.gif]

 

 

 

[g206073ko51i001.gif]

 

 

[g206073ko51i002.gif]

 

 

[g206073ko51i003.gif]

 

 

[g206073ko51i004.gif]

 

 

[g206073ko53i001.gif]

 

 

[g206073ko53i002.gif]

 

 

[g206073ko53i003.gif]

 

 

[g206073ko53i004.gif]

 

 

EXHIBIT B-3

 

CONSTRUCTION PRICING PROPOSAL

 

[SEE ATTACHED]

 

B-3-1

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

 

THE CRE GROUP INC Construction Management Log

GRAPHIC [g206073ko57i001.gif]

 

 

EXHIBIT C

 

EXISTING RIGHTS TO 16TH FLOOR

 

Suite 

 

RSF

 

Current T Expiration

 

Comments/Options

 

1600

 

5,888

 

1/31/2020

 

1, 5-yr renewal option. Notice by 1/31/2019

 

1600

 

5,888

 

8/9/2024

 

ROFO; Expires 8/10/2021

 

1630

 

5,764

 

8/9/2024

 

ROFO; Expires 8/10/2021

 

 

C-1

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

 

EXHIBIT D

 

RULES AND REGULATIONS

 

The following rules and regulations have been formulated for the safety and
well-being of all tenants of the Building.  Strict adherence to these rules and
regulations is necessary to guarantee that every tenant will enjoy a safe and
undisturbed occupancy of its premises.  Any violation of these rules and
regulations by Tenant shall constitute a default by Tenant under the Lease.

 

1                                         Tenant shall not obstruct or encumber
or use for any purpose other than ingress and egress to and from the Premises
any sidewalk, entrance, passage, court, elevator, vestibule, stairway, corridor,
hall or other part of the Building not exclusively occupied by Tenant.  No
bottles, parcels or other articles shall be placed, kept or displayed on window
ledges, in windows or in corridors, stairways or other public parts of the
Building.  Tenant shall not place any showcase, mat or other article outside the
Premises.  Nothing may be placed on or about balcony areas, if any, of the
Building without Landlord’s prior written approval.  Tenant shall keep all
portions of the Premises which are visible from the Building’s central atrium
(if any) in a tasteful, neat and orderly condition characteristic of first class
professional offices, so as not to be offensive to other tenants of the
Building.  No desks, bookcases, file cabinets and other furniture shall be
placed against the glass surrounding the Building’s central atrium (if any).

 

2                                         Landlord shall have the right to
control and operate the public portions of the Building and the facilities
furnished for common use of the tenants, in such manner as Landlord deems best
for the benefit of the tenants generally.  Tenant shall not permit the visit to
the Premises of persons in such numbers or under such conditions as to interfere
with the use and enjoyment of the entrances, corridors, elevators and other
public portions or facilities of the Building by other tenants.  Tenant shall
coordinate in advance with Landlord’s property management department all
deliveries to the Building so that arrangements can be made to minimize such
interference.  Tenant shall not permit its employees and invitees to congregate
in the elevator lobbies or corridors of the Building.  Canvassing, soliciting
and peddling in the Building are prohibited, and Tenant shall cooperate to
prevent the same.  Public corridor doors, when not in use, shall be kept
closed.  Nothing, including mats and trash, shall be placed, swept or thrown
into the corridors, halls, elevator shafts, stairways or other public or Common
Areas.

 

3                                         Tenant shall not attach, hang or use
in connection with any window or door of the Premises any drape, blind, shade or
screen, without Landlord’s prior written consent.  All awnings, drapes
projections, curtains, blinds, shades, screens and other fixtures shall be of a
quality, type, design and color, and shall be attached in a manner, approved in
writing by Landlord.  Any Tenant supplied window treatments shall be installed
behind Landlord’s standard window treatments so that Landlord’s standard window
treatments will be what is visible to persons outside the Building.  Drapes
(whether installed by Landlord or Tenant) which are visible from the exterior of
the Building shall be cleaned by Tenant at least once a year, without notice
from Landlord, at Tenant’s own expense.

 

D-1

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

 

4                                         Tenant shall not use the water
fountains, water and wash closets, and plumbing and other fixtures for any
purpose other than those for which they were constructed, and Tenant shall not
place any debris, rubbish, rag or other substance therein (including coffee
grounds).  All damages from misuse of fixtures shall be borne by the tenant
causing same.

 

5                                         Tenant shall not construct, maintain,
use or operate within the Premises any electrical device, wiring or apparatus in
connection with a loudspeaker system (other than an ordinary telephone and
paging system) or other sound system, in connection with any excessively bright,
changing, flashing, flickering or moving light or lighting device, or in
connection with any similar device or system, without Landlord’s prior written
consent.  Tenant shall not construct, maintain, use or operate any such device
or system outside of its Premises or within such Premises so that the same can
be heard or seen from outside the Premises.  No flashing, neon or search lights
shall be used which can be seen outside the Premises.  Only warm white lamps may
be used in any fixture that may be visible from outside the Building or
Premises.  Tenant shall not maintain, use or operate within the Premises any
space heater.

 

6                                         Tenant shall not bring any bicycle,
vehicle, animal, bird or pet of any kind into the Building, except seeing eye or
hearing ear dogs for handicapped persons visiting the Premises.  Bicycle parking
is available in the Parking Facility in a designated space for tenants on a
first come, first serve basis subject to such rules and regulations as Landlord
shall from time to time impose.  Except while loading and unloading vehicles,
there shall be no parking of vehicles or other obstructions placed in the
loading dock area.

 

7                                         Except as specifically provided to the
contrary in the Lease, Tenant shall not cook or permit any cooking on the
Premises, except for microwave cooking and use of coffee machines by Tenant’s
employees for their own consumption.  Tenant shall not cause or permit any
unusual or objectionable odor to be produced upon or emanate from the Premises.

 

8                                         Tenant shall not make any unseemly or
disturbing noise or disturb or interfere with occupants of the Building, whether
by the use of any musical instrument, radio, talking machine or in any other
way.

 

9                                         Tenant shall not place on any floor a
load exceeding the floor load per square foot which such floor was designed to
carry.  Landlord shall have the right to prescribe the weight, position and
manner of installation of safes and other heavy equipment and fixtures. 
Landlord shall have the right to repair at Tenant’s expense any damage to the
Premises or the Building caused by Tenant’s moving property into or out of the
Premises or due to the same being in or upon the Premises or to require Tenant
to do the same.  Tenant shall not receive into the Building or carry in the
elevators any safes, freight, furniture, equipment or bulky item except as
approved by Landlord, and any such furniture, equipment and bulky item shall be
delivered only through the designated delivery entrance of the Building and the
designated freight elevator at designated times.  Tenant shall remove promptly
from any sidewalk adjacent to the Building any furniture, furnishing, equipment
or other material there delivered or deposited for Tenant.  Landlord reserves
the right to inspect all freight to be brought into the Building, except for
government classified and confidential client materials, and to exclude from the
Building all freight which violates any of these rules or the Lease.

 

D-2

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

 

10                                  Tenant shall not place additional locks or
bolts of any kind on any of the doors or windows, and shall not make any change
in any existing lock or locking mechanism therein, without Landlord’s prior
written approval.  At all times Tenant shall provide Landlord with a “master”
key for all locks on all doors and windows.  Tenant shall keep doors leading to
a corridor or main hall closed at all times except as such doors may be used for
ingress or egress and shall lock such doors during all times the Premises are
unattended.  Tenant shall, upon the termination of its tenancy:  (a) restore to
Landlord all keys and security cards to stores, offices, storage rooms, toilet
rooms, the Building and the Premises which were either furnished to, or
otherwise procured by, Tenant, and in the event of the loss of any keys so
furnished, Tenant shall pay the replacement cost thereof; and (b) inform
Landlord of the combination of any lock, safe and vault in the Premises.  At
Landlord’s request, Landlord’s then customary charge per key shall be paid for
all keys in excess of two (2) of each type.  Tenant’s key system shall be
consistent with that for the rest of the Building.

 

11                                  Except as shown in the Final Construction
Drawings, Tenant shall not install or operate in the Premises any electrically
operated equipment or machinery (other than standard servers, desk-top office
equipment, including desk-top computers and copiers, typewriters, facsimile
machines, printers or other similar equipment used in connection with standard
office operations) without obtaining the prior written consent of Landlord. 
Landlord may condition such consent upon Tenant’s payment of additional rent in
compensation for the excess consumption of electricity or other utilities and
for the cost of any additional wiring or apparatus that may be occasioned by the
operation of such equipment or machinery.  Landlord shall have the right at any
time and from time to time to designate the electric service providers for the
Building.  Tenant shall cooperate with Landlord and such service providers and
shall allow, as reasonably necessary, access to the Building’s electric lines,
feeders, risers, wiring and any other Building machinery.  Tenant shall not
install any equipment of any type or nature that will or may necessitate any
changes, replacements or additions to, or changes in the use of, the water
system, heating system, plumbing system, air conditioning system or electrical
system of the Premises or the Building, without obtaining Landlord’s prior
written consent, which consent may be granted or withheld in Landlord’s sole and
absolute discretion.  In no event shall Tenant use or permit the use of any
space heaters or similar devices in the Premises.  If any machine or equipment
of Tenant causes noise or vibration that may be transmitted to such a degree as
to be objectionable to Landlord or any tenant in the Building, then Landlord
shall have the right to install at Tenant’s expense vibration eliminators or
other devices sufficient to reduce such noise and vibration to a level
satisfactory to Landlord or to require Tenant to do the same.

 

12                                  All telephone and telecommunications
services desired by Tenant shall be ordered by and utilized at the sole expense
of Tenant.  Unless Landlord otherwise requests or consents in writing, all of
Tenant’s telecommunications equipment shall be and remain solely in the Premises
and the telephone closet(s) designated by Landlord.  Landlord shall have no
responsibility for the maintenance of Tenant’s telecommunications equipment
(including wiring) nor for any wiring or other infrastructure to which Tenant’s
telecommunications equipment may be connected.  Landlord shall have the right,
upon reasonable prior notice to Tenant (except in the event of an emergency), to
interrupt telecommunications facilities as necessary in connection with any
repairs or with installation of other telecommunications equipment.  Subject to
the provisions of the Lease, Tenant shall not utilize any wireless
communications equipment (other

 

D-3

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

 

than usual and customary cellular telephones), including antennae and satellite
receiver dishes, at the Premises or the Building, without Landlord’s prior
written consent, which may be granted or withheld in Landlord’s sole and
absolute discretion.

 

13                                  No telephone, telecommunications or other
similar provider whose equipment is not then servicing the Building shall be
permitted to install its lines or other equipment within or about the Building
without first securing the prior written approval of Landlord, which approval
shall not be unreasonably withheld, conditioned or delayed.  Landlord’s approval
shall not be deemed any kind of warranty or representation by Landlord,
including any warranty or representation as to the suitability, competence, or
financial strength of the provider.  Without limitation of the foregoing
standards, as specific conditions of any consent:  (i) Landlord shall incur no
expense whatsoever with respect to any aspect of the provider’s provision of its
services (including the costs of installation, materials and services);
(ii) prior to commencement of any work in or about the Building by the provider,
the provider shall supply Landlord with such written indemnities, insurance,
financial statements, and such other items as Landlord reasonably determines and
Landlord shall have reasonably determined that there is sufficient space in the
Building for the placement of the necessary equipment and materials; (iii) the
provider agrees to abide by such rules and regulations, building and other
codes, job site rules and such other requirements as are reasonably determined
by Landlord to be necessary; (iv) the provider shall agree to use existing
building conduits and pipes or use building contractors (or other contractors
approved by Landlord); (v) the provider shall pay Landlord such compensation as
is reasonably determined by Landlord to compensate it for space used in the
building for the storage and maintenance of the provider’s equipment, the fair
market value of a provider’s access to the Building, and the costs which may
reasonably be expected to be incurred by Landlord; (vi) the provider shall agree
to deliver to Landlord detailed “as built” plans immediately after the
installation of the provider’s equipment is complete; and (vii) all of the
foregoing matters shall be documented in a written agreement between Landlord
and the provider on Landlord’s standard form and otherwise reasonably
satisfactory to Landlord.

 

14                                  Landlord reserves the right to exclude from
the Building at all times any person who does not properly identify himself to
the Building management or attendant on duty.  Landlord shall have the right to
exclude any undesirable or disorderly persons from the Building at any time. 
Landlord may require all persons admitted to or leaving the Building to show
satisfactory identification and to sign a register.  Tenant shall be responsible
for all persons for whom it authorizes entry into the Building and shall be
liable to Landlord for all acts of such persons.  Landlord has the right to
evacuate the Building in the event of emergency or catastrophe or for the
purpose of holding a reasonable number of fire drills.

 

15                                  Tenant shall not permit or encourage any
loitering in or about the Premises and shall not use or permit the use of the
Premises for lodging, dwelling or sleeping.

 

16                                  Tenant, before closing and leaving the
Premises at the end of each business day, shall see that all lights and
equipment are turned off, including coffee machines.

 

17                                  Tenant shall not request Landlord’s
employees to perform any work or do anything outside of such employees’ regular
duties without Landlord’s prior written consent.  Tenant’s special requirements
will be attended to only upon application to Landlord, and any

 

D-4

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

 

such special requirements shall be billed to Tenant in accordance with the
schedule of charges maintained by Landlord from time to time or as is agreed
upon in writing in advance by Landlord and Tenant.  Tenant shall not employ any
of Landlord’s employees for any purpose whatsoever without Landlord’s prior
written consent.  Tenant shall not employ any person or entity to do janitorial
work within the Premises without Landlord’s prior written consent, and any and
all such work shall be done in compliance with all instructions issued by
Landlord or its representatives.

 

18                                  There shall not be used in any space, or in
the public halls of the Building, either by any tenant or by jobbers or others
in the delivery or receipt of merchandise, any hand trucks, except those
equipped with rubber tires and side guards.  Tenant shall be responsible for any
loss or damage resulting from any deliveries made by or for Tenant.

 

19                                  Tenant shall not install or permit the
installation of any wiring for any purpose on the exterior of the Premises. 
Landlord will direct electricians as to where and how telephone and telegraph
wires are to be introduced.  No boring or cutting for wires or stringing of
wires will be allowed without written consent of Landlord.  The location of
telephones, call boxes and other office equipment affixed to the Premises shall
be subject to the approval of Landlord.  All such work shall be effected
pursuant to permits issued by all applicable governmental authorities having
jurisdiction.  Tenant shall not do anything, or permit anything to be done, in
or about the Building, or bring or keep anything therein, that will in any way
increase the possibility of fire or other casualty or obstruct or interfere with
the rights of, or otherwise injure or annoy, other tenants, or do anything in
conflict with the valid pertinent laws, rules, or regulations of any
governmental authority.

 

20                                  Tenant acknowledges that it is Landlord’s
intention that the Building be operated in a manner which is consistent with the
highest standards of cleanliness, decency and morals in the community which it
serves.  Toward that end, Tenant shall not sell, distribute, display or offer
for sale any item which, in Landlord’s judgment, is inconsistent with the
quality of operation of the Building or may tend to impose or detract from the
moral character or image of the Building.  Tenant shall not use the Premises for
any immoral or illegal purpose.  Tenant shall cooperate with Building employees
in keeping the Premises neat and clean.

 

21                                  Unless otherwise expressly provided in the
Lease, Tenant shall not use, occupy or permit any portion of the Premises to be
used or occupied for the storage, manufacture, or sale of liquor.

 

22                                  Tenant shall purchase or contract for
waxing, rug shampooing, venetian blind washing, interior glass washing,
furniture polishing, janitorial work, removal of any garbage from any dining or
eating facility or for towel service in the Premises, only from contractors,
companies or persons designated by Landlord.  Tenant may have any such service
provided within the Premises only upon prior written notice to Landlord or the
Building manager in each instance, and Tenant shall provide Landlord or the
Building manager with identifying information regarding each individual
performing any such services, other than full-time employees of Tenant, prior to
such individual’s commencing work, and Tenant shall direct and cause each such
individual, while in the Building and outside of the Premises, to comply with
all instructions issued by Landlord or its representatives.

 

D-5

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

 

23                                  Tenant shall not remove, alter or replace
the ceiling light diffusers, ceiling tiles or air diffusers in any portion of
the Premises without the prior written consent of Landlord

 

24                                  Tenant shall not purchase water, ice,
coffee, soft drinks, towels, or other merchandise or services from any company
or person whose repeated violation of Building regulations has caused, in
Landlord’s opinion, a hazard or nuisance to the Building and/or its occupants.

 

25                                  Tenant shall not pay any employee on the
Premises except those actually employed therein; nor shall Tenant use the
Premises as headquarters for large scale employment of workers for other
locations.

 

26                                  Landlord shall have the right, upon written
notice to Tenant, to require Tenant to refrain from or discontinue any
advertising by Tenant which, in Landlord’s opinion, tends to impair the
reputation of the Building or its desirability for offices.

 

27                                  Tenant shall not in any manner deface any
part of the Premises or the Building.  Other than ordinary office decorations,
no stringing of wires, boring or cutting shall be permitted except with
Landlord’s prior written consent.  Any floor covering installed by Tenant shall
have an under layer of felt rubber, or similar sound deadening substance, which
shall not be affixed to the floor by cement or any other non-soluble adhesive
materials.

 

28                                  Any installations to provide supplemental
cooling for any portion of the Premises shall be made in such manner and using
such equipment and facilities as Landlord may designate and direct, and all work
relating to any such installations shall in all respects be performed at
Tenant’s sole cost and expenses pursuant to plans approved in advance in writing
by Landlord, and in all other respects in the manner required pursuant to the
Lease.

 

29                                  Tenant shall handle its newspapers, “office
paper,” garbage, trash and other waste products in the manner required by
applicable law (as the same may be amended from time to time) whether required
of Landlord or otherwise and shall conform with any recycling plan instituted by
Landlord.  Landlord shall have no obligation to accept any waste that is not
prepared for collection in accordance with any such requirements.  Landlord
reserves the right to require Tenant to arrange for waste collection, at
Tenant’s sole cost and expense, utilizing a contractor reasonably satisfactory
to Landlord, and to require Tenant to pay all costs, expenses, fines, penalties,
or damages that may be imposed on Landlord or Tenant by reason of Tenant’s
failure to comply with any such requirements.  If Tenant is unable to comply
with Landlord’s standard procedures regarding the internal collection, sorting,
separation and recycling of waste, then, upon reasonable advance notice to
Landlord, Landlord shall use reasonable efforts to arrange for alternative
procedures for Tenant, provided Tenant shall pay Landlord all additional costs
incurred by Landlord with respect thereto.

 

30                                  Tenant shall not bring or keep, or permit to
be brought or kept, in the Building any weapon or flammable, combustible or
explosive fluid, chemical or substance, except as otherwise expressly permitted
in the Lease.

 

D-6

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

 

31                                  Tenant shall comply with all workplace
smoking Laws.  There shall be no smoking in bathrooms, elevator lobbies,
elevators, terraces, loading docks, plaza areas, and other Common Areas.

 

32                                  All wiring and cabling installed by Tenant
shall be marked and coded, in a manner reasonably acceptable to Landlord, to
identify such facilities as belonging to Tenant and the point of commencement
and termination of such facilities.  All such cabling and wiring shall, at
Landlord’s request, be removed by Tenant upon the expiration or termination of
the Lease if required by the terms of the Lease or if applicable governmental
agencies require removal of such facilities upon the termination of their use or
abandonment.

 

33                                  Landlord may, upon request of Tenant, waive
Tenant’s compliance with any of the rules, provided that (a) no waiver shall be
effective unless signed by Landlord, (b) no waiver shall relieve Tenant from the
obligation to comply with such rule in the future unless otherwise agreed in
writing by Landlord, (c) no waiver granted to any tenant shall relieve any other
tenant from the obligation of complying with these rules and regulations, and
(d) no waiver shall relieve Tenant from any liability for any loss or damage
resulting from Tenant’s failure to comply with any rule.  Landlord reserves the
right to rescind any of these rules and make such other and further rules as in
the judgment of Landlord shall from time to time be needed for the safety,
protection, care, and cleanliness of the Building, the operation thereof, the
preservation of good order therein, and the protection and comfort of its
tenants, their agents, employees, and invitees, which rules when made and notice
thereof given to a tenant shall be binding upon it in like manner as if
originally herein prescribed.  In the event of any conflict or inconsistency
between the terms and provisions of these rules, as now or hereafter in effect,
and the terms and provision of the Lease, the terms and provision of the Lease
shall prevail.

 

D-7

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