EXHIBIT 10.01

LEASE

between

PR III MIDDLEFIELD ROAD, LLC,

Landlord

and

VERISIGN, INC.,

Tenant

Date: As of: June 19, 2008

Premises:

675 and 685 East Middlefield Road

Mountain View, California 94043

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TABLE OF CONTENTS

 

          Page

1.

   DEFINITIONS    1

2.

   DEMISE    6

3.

   TERM    7

4.

   RENT    8

5.

   REAL ESTATE TAXES    9

6.

   USE AND COMPLIANCE    10

7.

   INSTALLATIONS OF TENANT PROPERTY    13

8.

   UTILITIES AND SERVICES    14

9.

   REPAIR AND MAINTENANCE; EXPENSES    14

10.

   MECHANICS’ AND OTHER LIENS    19

11.

   ALTERATIONS    19

12.

   INSURANCE    20

13.

   DAMAGE OR DESTRUCTION    22

14.

   CONDEMNATION    24

15.

   DEFAULT BY TENANT    26

16.

   LANDLORD OR TENANT MAY PERFORM THE OTHER’S OBLIGATIONS    28

17.

   SURRENDER OF PREMISES; HOLDOVER    29

18.

   ASSIGNMENT AND SUBLETTING    30

19.

   INDEMNITY    31

20.

   ENVIRONMENTAL MATTERS    32

21.

   SUBORDINATION    32

22.

   BROKER    33

23.

   NOTICES    33

24.

   QUIET ENJOYMENT    34

25.

   ESTOPPEL CERTIFICATE    34

26.

   LIMITATION OF LIABILITY    34

27.

   ACCESS OF LANDLORD TO PREMISES    34

28.

   AUTHORITY    35

29.

   LANDLORD EXCULPATION    35

30.

   TRANSFER OF LANDLORD’S INTEREST    35

31.

   ERISA    36

32.

   ANTI-TERRORISM REPRESENTATIONS    36

 

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TABLE OF CONTENTS

 

          Page

33.

   WAIVER OF POST-JUDGMENT REMEDY, REDEMPTION, COUNTERCLAIM AND JURY TRIAL    36

34.

   PROPOSITION 65 WARNING    37

35.

   TERMINOLOGY    37

36.

   MISCELLANEOUS PROVISIONS    37

EXHIBITS

  

Exhibit A Description of the Land

  

Exhibit B Form of Subordination, Non-Disturbance and Attornment Agreement

  

 

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LEASE

THIS LEASE (“Lease”) is made as of June 19, 2008, (the “Effective Date”) by and
between PR III Middlefield Road, LLC, a California limited liability company,
(“Landlord”) and VeriSign, Inc., a Delaware corporation, (“Tenant”).

W I T N E S S E T H:

WHEREAS, Landlord owns fee simple title to a parcel of land, more particularly
described as the “Land” below, upon which are currently constructed surface
parking areas, infrastructure components and the following improvements: (i) the
building commonly known as 675 East Middlefield Road, Mountain View, California
containing approximately 52,931 rentable square feet of interior floor area and
(ii) the building commonly known as 685 East Middlefield Road, Mountain View,
California containing approximately 105,950 rentable square feet of interior
floor area.

WHEREAS, Landlord desires to lease the Property to Tenant and Tenant desires to
lease the Property from Landlord, upon and subject to the terms and conditions
set forth herein.

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, Landlord and Tenant hereby agree as follows:

1. DEFINITIONS

As used herein, the following terms and phrases shall have the meanings
indicated below:

1.1 “Additional Rent” means any payments or reimbursements required to be made
by Tenant to Landlord hereunder during the Term of this Lease, other than the
Basic Rent.

1.2 “Alterations” means any alterations, additions, improvements or replacements
to the Premises.

1.3 “Anti-Terrorism Laws” has the meaning set forth in Section 32.

1.4 “Basic Rent” has the meaning set forth in Section 4.1.

1.5 “Building” or “Buildings” means, individually or collectively as the context
requires, the buildings, other improvements, associated equipment and
appurtenances thereto of every kind and description located on and within the
Land as of the Commencement Date.

1.6 “Building Systems” has the meaning set forth in Section 9.1.

1.7 “Casualty” has the meaning set forth in Section 13.1.

1.8 “Chiller” means that certain water cooled chiller referenced in that certain
Property Condition Assessment Report dated February 8, 2008, prepared by
Marx/Okubo as Job No. 08-9007 B.

 

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1.9 “Claims” means, collectively, liability, claims, demands, damages and costs
(including attorneys’ fees and expenses) of any and every kind or character,
known or unknown, for, arising out of, or attributable to, an event,
circumstance or condition, including, without limitation, any and all actual,
threatened or potential claims, claims for contribution under Environmental
Laws, suits, proceedings, actions, causes of action, demands, liabilities,
losses, obligations, orders, requirements or restrictions, liens, penalties,
fines, charges, debts, damages, costs, and expenses of every kind and nature,
whether now known or unknown, whether foreseeable or unforeseeable, whether
under any foreign, federal, state or local law (both statutory and
non-statutory), and, whether asserted or demanded by a third party against
Landlord, a Landlord Affiliate or any other claimant or potential claimant, or
incurred directly or indirectly by any of them.

1.10 “Commencement Date” means the Effective Date of this Lease.

1.11 “Common Areas” has the meaning set forth in Section 6.3.

1.12 “Condemnation” has the meaning set forth in Section 14.1.

1.13 “Condemnation Restoration Completion Estimate” has the meaning set forth in
Section 14.3.

1.14 “Damaged Property” has the meaning set forth in Section 13.1.

1.15 “Default Rate” means ten percent (10%) per annum.

1.16 “Effective Date” has the meaning set forth in the first sentence of this
Lease.

1.17 “EMBP 455” has the meaning set forth in Section 1.54.

1.18 “Environmental Laws” means any applicable federal, state or local law,
statute, regulation, rule, ordinance, permit, prohibition, restriction, license,
requirement, agreement, consent, or approval, or any determination, directive,
judgment, decree or order of any executive, administrative or judicial authority
at any federal, state or local level (whether now existing or subsequently
adopted or promulgated) relating to pollution or the protection of the
environment, natural resources or public health and safety.

1.19 “Event of Default” has the meaning set forth in Section 15.1.

1.20 “Expenses” has the meaning set forth in Section 4.4.

1.21 “Expiration Date” means the last day of the thirtieth (30th) full calendar
month following the Commencement Date.

1.22 “Extension Notice” has the meaning set forth in Section 3.3.

1.23 “Extension Option” has the meaning set forth in Section 3.2.

 

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1.24 “Extension Optionee” has the meaning set forth in Section 3.4.

1.25 “Extension Period” has the meaning set forth in Section 3.2.

1.26 “Extension Period Fair Market Rent” has the meaning set forth in
Section 3.6.

1.27 “Governmental Authority” means the United States, the state, county, city
and political subdivision in which the Property is located or that exercises
jurisdiction over the Property, Landlord or Tenant, and any agency, department,
commission, board, bureau or instrumentality of any of the foregoing that
exercises jurisdiction over the Property, Landlord or Tenant.

1.28 “Hazardous Materials” means any material, waste, chemical, compound,
substance, mixture, or byproduct that is identified, defined, designated,
listed, restricted or otherwise regulated under Environmental Laws as a
“hazardous constituent,” “hazardous substance,” “hazardous material,” “extremely
hazardous material,” “hazardous waste,” “acutely hazardous waste,” “hazardous
waste constituent,” “infectious waste,” “medical waste,” “biohazardous waste,”
“extremely hazardous waste,” “pollutant,” “toxic pollutant,” or “contaminant,”
or any other formulation intended to classify substances by reason of properties
that are deleterious to the environment, natural resources or public health or
safety including, without limitation, ignitability, corrosiveness, reactivity,
carcinogenicity, toxicity, and reproductive toxicity. The term Hazardous
Materials shall include, without limitation, the following:

(a) a “Hazardous Substance,” “Hazardous Material,” “Hazardous Waste,” or “Toxic
Substance” under the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, 42 U.S.C. Section 9601, et seq., the Hazardous Materials
Transportation Act, 49 U.S.C. Section 5101, et seq. or the Solid Waste Disposal
Act, 42 U.S.C. Section 6901, et seq., including any regulations promulgated
thereunder, as any of the foregoing may be amended;

(b) an “Acutely Hazardous Waste,” “Extremely Hazardous Waste,” “Hazardous
Waste,” or “Restricted Hazardous Waste,” under Section 25110.02, 25115, 25117 or
25122.7 of the California Health and Safety Code, or listed pursuant to
Section 25140 of the California Health and Safety Code, as any of the foregoing
may be amended;

(c) a “Hazardous Material,” “Hazardous Substance” or “Hazardous Waste” under
Section 25117, 25260, 25281, 25316, 25501, or 25501.1 of the California Health
and Safety Code, as any of the foregoing may be amended;

(d) “Oil” or a “Hazardous Substance” under Section 311 of the Federal Water
Pollution Control Act, 33 U.S.C. Section 1321, as may be amended; as well as any
other hydrocarbonic substance, fraction, distillate or by-product;

(e) any substance or material defined, identified or listed as an “Acutely
Hazardous Waste,” “Extremely Hazardous Material,” “Extremely Hazardous Waste,”

 

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“Hazardous Constituent,” “Hazardous Material,” “Hazardous Waste,” “Hazardous
Waste Constituent,” or “Toxic Waste” pursuant to Division 4.5, Chapters 10 or 11
of Title 22 of the California Code of Regulations, as may be amended;

(f) any substance or material listed by the State of California as a chemical
known by the State to cause cancer or reproductive toxicity pursuant to
Section 25249.8 of the California Health and Safety Code, as may be amended;

(g) a “Biohazardous Waste” or “Medical Waste” under Sections 117635 or 117690 of
the California Health and Safety Code, as may amended;

(h) mold;

(i) asbestos and any asbestos containing material; and/or

(j) a substance that, due to its characteristics or interaction with one or more
other materials, wastes, chemicals, compounds, substances, mixtures, or
byproducts, damages or threatens to damage the environment, natural resources or
public health or safety, or is required by any law or public entity to be
remediated, including remediation which such law or public entity requires in
order for property to be put to any lawful purpose.

1.29 “Holdover Period” has the meaning set forth in Section 17.3.

1.30 “Insurance Requirements” means the requirements, whether now or hereafter
in force, of any insurer, the local Board of Fire Underwriters and Fire
Insurance Rating Organization or any other organization performing the same or
similar functions, applicable to the Premises, or the use or manner of use
thereof.

1.31 “Land” means that certain parcel of land located in the City of Mountain
View, Santa Clara County, California identified as parcel Number 16 060 013 in
the land records of Santa Clara, aggregating approximately 10.6 acres of land
area and appurtenances thereto of every kind and description, which parcel of
land is more particularly described on Exhibit A attached hereto and made a part
hereof.

1.32 “Landlord Affiliate” means any firm, corporation or other entity directly
or indirectly controlled by, in control of or under common control with
Landlord.

1.33 “Landlord Party” or “Landlord Parties” means (1) any Landlord Affiliate,
(2) any principal, director, officer, employee, agent, consultant or contractor
of Landlord or any Landlord Affiliate, or (3) any Mortgagee or any principal,
director, officer, employee, agent, consultant or contractor thereof.

1.34 “Landlord’s Restoration Work” has the meaning set forth in Section 13.1.

1.35 “Legal Requirements” means all laws (including Environmental Laws),
statutes, ordinances, orders, rules, regulations and requirements and permits of
any

 

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Governmental Authority, whether now or hereafter in force, applicable to the
Premises, or the ownership, operation, occupancy, repair, maintenance or use
thereof. The term “Legal Requirements” shall include any requirements of
Environmental Laws.

1.36 “Monetary Default” has the meaning set forth in Section 15.1(a).

1.37 “Mortgage” means any mortgage, deed of trust, deed to secure debt, or
similar instrument encumbering fee title to the Premises (whether or not such
mortgage shall also cover other real property) and any and all modifications,
consolidations and extensions, renewals and replacements thereof.

1.38 “Mortgagee” shall mean the holder of or beneficiary under, as applicable,
any Mortgage.

1.39 “Non-Disturbance Agreement” means a subordination, non-disturbance and
attornment agreement in the form of Exhibit B attached hereto (subject to such
commercially reasonable changes as the holder of such mortgage may reasonably
propose in accordance with Section 21.2).

1.40 “notice” shall have the meaning set forth in Section 23.1.

1.41 “Outside Completion Date” has the meaning set forth in Section 13.2.

1.42 “Parking Areas” has the meaning set forth in Section 6.3.

1.43 “Premises” means the Property and all easements, rights and appurtenances
with respect thereto.

1.44 “Prime Rate” means the per annum rate identified as the “Prime Rate” in the
“Money Rates” section of the Wall Street Journal (or comparable index, if such
publication is discontinued).

1.45 “Prohibited Persons” has the meaning set forth in Section 32.

1.46 “Property” means, collectively, the Land and the Buildings.

1.47 “Real Estate Taxes” means all real estate taxes, assessments and water and
sewer rents, general or special, ordinary or extraordinary, foreseen or
unforeseen, of any kind or nature whatsoever to the extent assessed against the
Property, but not income, franchise, sales, excess profit, transfer, inheritance
or other taxes assessed against Landlord’s income or profits from the Premises,
the Property or otherwise.

1.48 “Rent” means, collectively, Basic Rent and Additional Rent.

1.49 “Restoration Completion Estimate” has the meaning set forth in
Section 13.1.

1.50 “Successor” has the meaning set forth in Section 3.4.

 

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1.51 “Support Equipment” has the meaning set forth in Section 7.2.

1.52 “Surrender Condition” has the meaning set forth in Section 9.1.

1.53 “Tenant Affiliate” has the meaning set forth in Section 3.4.

1.54 “Tenant Party” or “Tenant Parties” means (1) any Successor or Tenant
Affiliate other than EMBP 455, L.L.C., a California limited liability company,
its successors and assigns (“EMBP 455”) in its capacity as owner, lessee or
occupant of any real property that is adjacent to or in the vicinity of the
Premises, (2) any principal, director, officer, employee, agent, consultant, or
contractor of Tenant or of any Successor or Tenant Affiliate other than EMBP 455
in its capacity as owner, lessee or occupant of any real property that is
adjacent to or in the vicinity of the Premises and (3) any invitee of Tenant or,
if the Lease is assigned, or the Premises are sublet to any Successor or Tenant
Affiliate, any invitee of such Successor or Tenant Affiliate, as the case may
be.

1.55 “Tenant Property” means all furniture, equipment and other personal
property of Tenant, including, without limitation, its data and computer
equipment, trade fixtures. Tenant Property excludes fixtures (other than trade
fixtures) and Alterations.

1.56 “Tenant’s Prior Use” has the meaning set forth in Section 6.1.

1.57 “Term” has the meaning set forth in Section 3.1.

1.58 “Unavoidable Delay” means any delay caused by strikes or other labor
disputes, acts of God, inability to obtain labor or materials, governmental
actions or restrictions, enemy action, civil commotion, sabotage, terrorism,
vandalism, fire and other casualty, judicial or other legal proceeding affecting
performance hereunder, or similar causes beyond the reasonable control of the
responsible party.

1.59 “Untenantable” has the meaning set forth in Section 13.1.

1.60 “Utilities” has the meaning set forth in Section 8.1.

1.61 “USA Patriot Act” has the meaning set forth in Section 32.

1.62 “Worth at the Time of Award” shall have the meaning set forth in
Section 15.

2. DEMISE

2.1 In consideration of the covenants set forth herein and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Landlord hereby leases the Premises to Tenant, and Tenant hereby
leases the Premises from Landlord, for the Term, upon and subject to the terms
and conditions set forth herein.

2.2 Landlord’s rights, title and interest in and to vault spaces, if any, that
are within or outside the boundary of the Land, but adjoining the Land and the
Premises are included

 

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in the Premises and shall be available to Tenant for its use and enjoyment
hereunder, provided that such use shall be at Tenant’s sole cost and expense and
shall be subject to and shall comply with all applicable Legal Requirements.

2.3 Tenant’s leasehold estate shall be burdened by, and Tenant shall have the
right to use and enjoy and otherwise benefit from, as the case may be, any
easement, negative easement, restrictive covenant, or any other right or
interest appurtenant to or burdening the Land as of the Effective Date hereof.

3. TERM

3.1 The term of this Lease (the “Term”) shall commence on the Commencement Date
and shall continue through and end at 11:59 p.m. on the Expiration Date, unless
extended pursuant to this Section 3, in which case the Term shall continue
through and end at 11:59 p.m. on the last calendar day of the Extension Period
(defined below).

3.2 Tenant shall have and is hereby granted one (1) option (the “Extension
Option”) to extend the Term of this Lease for a period commencing at 11:59 p.m.
on the Expiration Date and ending on the fifth (5th) anniversary of the
Expiration Date (such period, the “Extension Period”). If the Extension Option
is exercised, Tenant shall continue to lease the entire Premises during the
Extension Period on the same terms, covenants and conditions as provided in this
Lease, except that the monthly Basic Rent during the Extension Period shall be
the greater of (i) $2.75 per square foot of rentable area of the Premises (based
on the rentable square feet of interior floor areas specified in the Recitals)
and (ii) the Extension Period Fair Market Rent (defined in Section 3.6 below).

3.3 The Extension Option must be exercised, if at all, by written notice (the
“Extension Notice”) given by Tenant to Landlord at least twelve (12) months
prior to the date on which the Extension Period is to commence. If the Extension
Notice is not so given, such Extension Option shall automatically expire.

3.4 Notwithstanding anything above to the contrary, unless Landlord approves
otherwise, the Extension Option is personal to (i) VeriSign, Inc.; (ii) any
other corporation or other entity which directly or indirectly controls, is
controlled by or is under common control with VeriSign Inc. (a “Tenant
Affiliate”), and (iii) a successor corporation or other entity into which or
with which Tenant is merged or consolidated or which acquires all or a
substantial portion of Tenant’s assets located at, or the business conducted by
Tenant in and from, the Premises (a “Successor”) (collectively, items
(i) through (iii), an “Extension Optionee”) and may be exercised only by the
Extension Optionee (and not any sublessee or other transferee of Extension
Optionee’s interest in this Lease) and may not be exercised or be assigned,
voluntarily or involuntarily, by any person or entity other than the Extension
Optionee. The Extension Option is not assignable separate and apart from this
Lease, nor may the Extension Option be separated from this Lease in any manner,
either by reservation or otherwise.

3.5 Tenant shall have no right to exercise the Extension Option during the
pendency of a default under this Lease. The period of time within which the
Extension Option may be exercised shall not be extended or enlarged by reason of
Tenant’s inability to exercise such Extension Option because of the provisions
of this Section 3.5.

 

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3.6 On the first day of the fifteenth (15th) month prior to the date on which
the Extension Period would commence, if the Extension Option were to be
exercised, Landlord shall give Tenant a written notice of Landlord’s good faith
determination of the fair market Basic Rent for the Premises to be applicable
during the Extension Period. In the event that Tenant accepts Landlord’s
determination or Landlord and Tenant reach an agreement of the amount of fair
market rent for the extension period, Landlord and Tenant shall execute a
written agreement as to such amount and such amount shall constitute the
Extension Period fair market Basic Rent. In the event that Landlord and Tenant
fail to reach agreement on the fair market rent for the extension period, then
the “Extension Period Fair Market Rent” shall be the fair market rent last
proposed by Landlord to Tenant in writing, and if Tenant is not satisfied with
such “fair market rent,” Tenant may elect not to exercise the Extension Option.
The fair market Basic Rent for the Premises during the Extension Period as
determined pursuant to this Section 3.6 shall constitute the “Extension Period
Fair Market Rent.”

4. RENT

4.1 Tenant, throughout the following period of the Term, shall pay to Landlord
basic rent (“Basic Rent”) for the Premises at the following rates:

 

Lease Period

   Basic Rent per
Rentable
Square Foot    Monthly Basic
Rent for 675
East
Middlefield
Road,
Mountain
View,
California    Monthly Basic
Rent for 685
East
Middlefield
Road,
Mountain
View,
California    Total Monthly
Basic Rent

Commencement Date – 06/30/09

   $ 2.50    $ 132,327.50    $ 264,875.00    $ 397,202.50

07/01/09 – 06/30/10

   $ 2.60    $ 137,620.60    $ 275,470.00    $ 413,090.60

07/01/10 – 12/31/10

   $ 2.70    $ 142,913.70    $ 286,065.00    $ 428,978.70

During the Extension Period, if any, Tenant shall pay the amount of Basic Rent
determined in accordance with Section 3.2.

4.2 Monthly installments of Basic Rent shall be due and payable, in advance, on
the Commencement Date and thereafter on the first (1st) day of each calendar
month during the Term (except that installments of Basic Rent for less than a
full calendar month shall be pro-rated on a per diem basis). Basic Rent shall be
payable, at Tenant’s election, by check or wire transfer. Basic Rent is not
subject to adjustment or recalculation based on any measurement or remeasurement
of the Premises or Buildings.

 

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4.3 Basic Rent shall be paid to Landlord (at Landlord’s address as provided in
Section 23.2) without notice or demand and without deduction, abatement or
set-off of any kind, except as otherwise expressly provided in this Lease.

4.4 Tenant acknowledges and agrees that, subject to Sections 6.2, 9, 13 and 14,
this Lease is intended by the parties to yield to Landlord the Basic Rent as and
when due hereunder absolutely free or net of all expenses, costs and charges
(including, without limitation, Real Estate Taxes) allocable to the Term
(including the Option Term, if applicable), which are in any manner associated
with the operation, use, management, repair, maintenance, and insuring of the
Premises (including, without limitation, all costs and expenses incurred by
Tenant in connection with satisfying Tenant’s operation, maintenance and repair
obligations as set forth in Section 9.1 or by Landlord pursuant to Section 9.3,
but not including costs and expenses excluded under Section 9.4) (collectively,
“Expenses”), all of which Expenses shall be paid by Tenant directly to the
applicable utility companies, vendors and other entities to whom such Expenses
are owed, (except for (a) Real Estate Taxes, which shall be paid as Additional
Rent by Tenant to Landlord in accordance with Section 5, (b) Landlord’s
insurance required under Section 12, which shall be procured and paid for by
Landlord and reimbursed to Landlord by Tenant as Additional Rent in accordance
with Section 12.7), and (c) Expenses reimbursable to Landlord pursuant to
Section 9.3 below. However, the foregoing obligations shall be apportioned
between Landlord and Tenant as of the Commencement Date and the expiration of
the Term, so that Tenant shall be obligated to pay only those portions of such
payment obligations and liabilities that are allocable to the Term.
Notwithstanding the foregoing, however, Tenant shall not be obligated to pay any
Expenses of: (i) repairing or maintaining the Premises to the extent excluded
under Section 6.2 or Section 9; (ii) any Expenses for improving, remodeling or
replacing the Premises (except to the extent covered by Tenant’s indemnification
obligations set forth in Section 19 below, but subject to Section 12.3);
(iii) Expenses that are identified as an obligation of Landlord or otherwise
excluded from Tenant’s obligations under this Lease or (iv) expenses for
insurance to the extent such insurance does not relate to the Premises or
insures other property, none of which shall be due or payable as Additional
Rent.

4.5 Basic Rent shall be paid to Landlord (at Landlord’s address as set forth in
Section 23.2 as said address may be changed from time to time by notice given
under that section) without notice or demand and without deduction, abatement or
set-off of any kind, except as otherwise expressly provided in this Lease.

5. REAL ESTATE TAXES

5.1 Tenant shall pay, as Additional Rent, all Real Estate Taxes payable during
the Term of this Lease in accordance with this Section 5. Landlord, at
Landlord’s option, shall either (i) pay such Real Estate Taxes accruing during
the Term of this Lease directly to the taxing authority on or prior to the date
due and Tenant shall reimburse Landlord therefor within thirty (30) days after
receipt of a bill therefor from Landlord, which bill shall be accompanied by a
copy of the tax bill to which it relates or (ii) bill Tenant in advance for such
Real Estate Taxes by delivering to Tenant a written notice therefor together
with a copy of the tax bill to which it relates at least forty five (45) days
prior to the date that such Real Estate Taxes will become delinquent, in which
case Tenant shall make payment to Landlord of the full amount of Real

 

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Estate Taxes shown in such bill within thirty (30) days following receipt of
such notice and bill from Landlord or fifteen (15) days prior to the date that
such taxes will become delinquent, whichever is later. Landlord shall take the
benefit of any statute or ordinance permitting Real Estate Taxes to be paid in
installments, and the payments required hereunder shall be made in such
installments. Landlord shall be responsible for any interest or penalty
resulting from Landlord’s delay in billing Tenant or Landlord’s delay in paying
Real Estate Taxes to the taxing authority; Tenant shall be responsible for any
interest or penalty resulting from Tenant’s failure to make payment of Real
Estate Taxes to Landlord or the applicable taxing authority as the case may be
in accordance with the deadlines for payment set forth in this Section 5.1.

5.2 Tenant shall have the right to contest the amount or validity, in whole or
in part, of any Real Estate Taxes, or to seek a reduction in the valuation of
the Property, or any part thereof, as assessed for Real Estate Tax purposes, by
appropriate proceedings diligently conducted in good faith; provided that,
Tenant must either pay any such taxes in protest, submit such bonds to the
taxing authorities or take such other action as may be prudent to prevent any
loss or forfeit of the Property or any penalties. Landlord shall cooperate with
any such tax reduction proceeding at Tenant’s sole cost and expense. Landlord
shall notify Tenant of any increase in the assessed valuation of the Property at
least thirty (30) days before the last day for filing an objection thereto. Any
refund of Real Estate Taxes that were paid by the Tenant during the Term or for
a period allocable to the Term shall promptly be paid to and be the property of
Tenant. Tenant agrees to indemnify, defend and hold Landlord harmless from and
against any claims, liabilities, damages, loss, expenses, costs to, or penalties
incurred by, Landlord arising from Tenant’s contesting any Real Estate Tax or
seeking a reduction in the valuation of the Property pursuant to this
Section 5.2.

5.3 Real Estate Taxes shall be apportioned between Landlord and Tenant for tax
bills relating to the Term, so that Tenant shall be required to pay only the
portion of the Real Estate Taxes allocable to the Premises during the Term
(including the Extension Period, if applicable), and Landlord shall pay the
remainder of such Real Estate Taxes.

5.4 Anything in this Section 5 to the contrary notwithstanding, Tenant shall
have no obligation to pay Real Estate Taxes which Landlord has failed to bill to
Tenant for one year or more following the date such Real Estate Taxes were due
and payable.

6. USE AND COMPLIANCE

6.1 Tenant may use and occupy the Premises for the uses which Tenant made of the
Premises prior to the Effective Date (“Tenant’s Prior Use”), and for office use,
parking, storage and other uses ancillary thereto to the extent that any such
uses do not violate Legal Requirements or Insurance Requirements. Tenant shall
have access to and from the Premises 24 hours a day, 7 days per week, throughout
the Term.

6.2 Notwithstanding anything to the contrary, nothing in this Lease (including,
without limitation, Section 4.5, this Section 6.2, Section 9 and Section 19)
shall be construed so as to require Tenant to repair, remedy or cure any
condition (or to indemnify, defend or hold Landlord or any of the Landlord
Parties harmless from or against any condition) that existed on or before the
Commencement Date (except to the extent that Tenant or any Tenant Party

 

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exacerbates such condition after the Commencement Date) or to make any payment
or reimbursement therefor whether under Section 4.5 as Additional Rent or
otherwise, or so as to negate, impair or diminish Landlord’s agreement to accept
the Property at the time of expiration or termination of this Lease in its “as
is,” “where is,” “with all faults” condition as of the Commencement Date. Tenant
shall not be obligated to remediate, cure or improve any condition relating to
the Premises (including any condition that constitutes a violation of Legal
Requirements) that existed on the Commencement Date or to pay or to reimburse
Landlord for any costs thereof whatsoever (unless, and except to the extent
that, Tenant or any Tenant Party exacerbates such existing condition after the
Commencement Date). Without limiting the foregoing, Tenant shall not have any
obligation to remove or remediate any Hazardous Materials that exist on, in, at,
under, beneath, emanating from, migrating to or from, or otherwise affecting the
Property prior to the Commencement Date (unless, and except to the extent that,
Tenant or any Tenant Party exacerbates such existing condition after the
Commencement Date). In no event shall the legal and regulatory compliance
obligations of Tenant under this Lease be construed as requiring Tenant directly
or indirectly to pay or reimburse Landlord for legal or regulatory compliance
costs not caused directly by Tenant’s business activities conducted on the
Premises during the Term. Further, Tenant shall have no obligation to repair,
remedy or cure or to indemnify, defend or hold Landlord or any of the Landlord
Parties harmless from or against any environmental or other condition of
(including, without limitation, the presence of Hazardous Materials in, on, or
about) any real property adjacent to, or in the vicinity of, the Premises that
is owned or leased by Tenant, any Tenant Parties or EMBP 455 or any of their
respective affiliates, which condition existed on or before the Commencement
Date and was known by or disclosed to Landlord, any Landlord Affiliate, or its
or their consultants prior to the Commencement Date, except to the extent that
Tenant, any Tenant Party, EMBP 455 or any of their respective affiliates
exacerbates such existing condition after the Commencement Date, and Landlord
releases Tenant, all Tenant Parties and EMBP 455 from all Claims related thereto
(except as otherwise provided in this sentence above). For purposes of this
Section 6.2, exacerbation of a condition shall not be deemed to include a
failure to repair, remedy or cure the condition of the Premises as such
condition existed on or before the Commencement Date.

6.3 At all times during the Term, Tenant and its employees shall have the right
to use all surface and garage parking spaces in and on the Property (“Parking
Areas”). All of such spaces shall be available on an exclusive, unassigned
self-parking basis without additional charge to Tenant, and Landlord shall not
hold, reserve, assign or grant third party rights to any of such parking spaces.
Tenant shall have the right to use at all times all common areas and appurtenant
sidewalks, roadways and other facilities located on the Property and serving the
Premises and any and all other portions of the Property, including, without
limitation, the lobby areas, hallways, stairways, elevators, lavatory
facilities, and loading docks (collectively, the “Common Areas”).

6.4 Landlord shall not close or change the common areas in a way as to alter or
diminish the quantity, quality, utility or character thereof or limit Tenant’s
ease of access to or use of its Premises, except as provided below on a
temporary basis, and then in a manner that minimizes any adverse impact on
Tenant. Landlord reserves the right from time to time to temporarily use any of
the Common Areas for the purpose of making repairs in or to the Buildings or
Common Areas that are within the scope of Landlord’s repair obligations under

 

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Section 9.2 of this Lease or are within the scope of Landlord’s obligations to
comply with any law or regulation or in connection with the exercise of its
other rights set forth in Section 27 of the Lease below, as long as such acts do
not unreasonably interfere with Tenant’s use of or access to the Premises.
Landlord may close temporarily such portions of the Common Areas and Parking
Areas as Landlord reasonably requires to make such repairs or as may be required
in connection with the exercise of its other rights set forth in Section 27
below. Notwithstanding the foregoing, however, during the Term (including,
without limitation the Extension Period, if any), Landlord shall not be entitled
to make and such reservation shall not include the right to make any
improvements or alterations to the Buildings, the Common Areas or the Parking
Areas or to make any changes in the location, size, shape and number of
driveways, entrances, stairways, elevators, loading and unloading areas,
ingress, egress, direction of traffic, landscaped areas and walkways and,
parking spaces and parking areas unless such changes are required to be made
during the Term (or any Extension Term) for the use of the Premises by Tenant or
such changes are required by Legal Requirements or Insurance Requirements or to
maintain the safety of persons and property at the Premises. During the Term (or
any Extension Term), Landlord shall not make any other changes with respect to
the Buildings, the Common Areas or the Parking Areas, unless Tenant consents
thereto in its sole discretion. Tenant hereby agrees that Landlord’s actions
consistent this Section 6.4 shall not constitute a constructive eviction of
Tenant nor entitle Tenant to any abatement of Rent. Landlord shall have no
responsibility or for any reason be liable to Tenant for any direct or indirect
injury to or interference with Tenant’s business arising from Landlord’s actions
with respect to this Section 6.4, 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 Landlord’s actions with respect to this Section 6.4, or for any
inconvenience or annoyance occasioned by Landlord’s actions with respect to this
Section 6.4, unless due to the gross negligence or willful misconduct of
Landlord.

6.5 Tenant hereby agrees to accept the Premises and the Property in their “AS
IS,” “WHERE IS,” “WITH ALL FAULTS” condition existing as of the Commencement
Date, subject to all applicable zoning, municipal, county and state laws,
ordinances and regulations governing and regulating the use of the Premises
(provided that Tenant’s compliance obligations shall be limited as set forth in
Section 6.2), and any covenants or restrictions of record, and accepts this
Lease subject thereto and to all matters disclosed thereby and by any exhibits
attached hereto. Tenant also acknowledges that neither Landlord nor any agent of
Landlord has made any representation or warranty regarding the present or future
condition or suitability of all or any portion of the Premises or the Property
for the conduct of Tenant’s business. Tenant hereby acknowledges that Landlord
shall not be obligated to provide or pay for any improvement work or services
related to the improvement of the Premises except as expressly provided in
Section 9.2 below.

6.6 Tenant shall have the right, after notice to Landlord, to contest by
appropriate legal proceedings, diligently conducted in good faith, the validity
or application of any and all Legal Requirements or Insurance Requirements with
which Tenant is obligated to comply pursuant to the provisions of Section 6
hereof; provided that, Tenant must either submit such bonds to the applicable
Governmental Authority or take such other action as may be necessary to prevent
any loss to or forfeiture of the Premises or penalty. Tenant agrees to

 

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indemnify, defend and hold harmless Landlord from and against any claim,
liability, loss cost or expense arising from Tenant’s contesting the validity or
application of any such Legal Requirement or Insurance Requirement pursuant to
this Section 6.6. Landlord shall provide reasonable cooperation to Tenant (at
Tenant’s sole cost and expense) in connection with the exercise by Tenant of its
rights under this Section 6.1, including, without limitation, executing any
application or document that may be reasonably required to be executed by
Landlord in connection therewith; provided that, in no event will Landlord be
obligated to execute any application or other document for any change to the
zoning or entitlement for the Property or to approve any change to the zoning or
entitlement for the Property or to take any other action that may materially
adversely affect the use or value of the Property as determined by Landlord in
its reasonable discretion.

6.7 Landlord shall reasonably cooperate with Tenant in connection with Tenant’s
rights and obligations under this Section 6, including, without limitation,
executing any application or document that may be reasonably required to be
executed by Landlord in connection therewith; provided that, in no event will
Landlord be obligated to execute any application or other document for any
change to the zoning or entitlement for the Property or to approve any change to
the zoning or entitlement for the Property or to take any other action that may
materially adversely affect the use or value of the Property as determined by
Landlord in its reasonable discretion.

7. INSTALLATIONS OF TENANT PROPERTY

7.1 At any time during the Term, Tenant may, without incurring any liability to
Landlord for payment of rent or otherwise, but at Tenant’s sole cost and risk
and subject to the other terms and provisions of this Lease (including, without
limitation, provisions obligating Tenant to comply with Legal Requirements and
Insurance Requirements), place and install Tenant Property in and upon the
Premises. During the Term hereof, Tenant shall pay, prior to delinquency, all
business and other taxes, charges, notes, duties, and assessments levied, and
rates or fees imposed, charged, or assessed against or in respect of Tenant’s
occupancy of the Premises or in respect of Tenant Property (including, without
limitation, taxes and assessments attributable to the cost or value of any
leasehold improvements made in or to the Premises during the Term by or for
Tenant), and shall indemnify, defend and hold Landlord harmless from and against
all payment of such taxes, charges, notes, duties, assessments, rates, and fees,
and against all loss, costs, charges, notes, duties, assessments, rates, and
fees, and any and all such taxes. Tenant shall cause Tenant Property to be
assessed and billed separately from the real and personal property of Landlord.

7.2 Landlord grants an irrevocable license to Tenant throughout the Term to
install, maintain, repair, replace, remove and use cables, utility boxes, lines,
wires, devices, generators, facilities and appurtenances (collectively, “Support
Equipment”) in, on or about the locations of the Property where the same are
located on the Commencement Date, including, without limitation, within conduits
and risers and any existing data rooms to the extent the same are used or are
necessary for the operation of Tenant’s internet, router, server, data and
computer equipment. During the Term, Tenant shall have the right to use the
existing Support Equipment serving the Premises and to run its data and computer
cabling into and between the floors of the

 

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Premises. Landlord shall cause any and all work being performed by Landlord or
by any third party or by any of its and their contractors to be performed so as
not to sever or interfere with such Support Equipment or with Tenant’s use of
risers and conduits. Except in the event of an emergency, Landlord shall provide
Tenant with not less than ten (10) days prior notice of any work (with details
as to the location and scope of such work) that could cause such severing or
interference. During such period, Tenant shall undertake commercially reasonable
efforts to identify such Support Equipment that may be affected by such proposed
work by tagging or other practical protective measures.

8. UTILITIES AND SERVICES

8.1 Tenant, throughout the Term, shall be solely responsible to arrange for all
services and utilities (including, without limitation, electricity, water,
sewerage, gas and telecommunications) necessary or desirable for Tenant in
connection with its operations at the Property (the “Utilities”) at the sole
cost, risk, and expense of Tenant.

8.2 Landlord shall have no obligation to provide for or pay for any Utilities,
nor shall Landlord unreasonably interfere in any manner with Tenant’s access to
or use or enjoyment of any Utilities at any time during the Term.

9. REPAIR AND MAINTENANCE; EXPENSES

9.1 Subject to Section 6.2, and except for Landlord’s obligations under
Section 9.2, Tenant shall at all times during the Term and at Tenant’s sole cost
and expense, operate, clean, maintain, repair, and preserve the Premises,
including without limitation the roof, plumbing, heating, ventilating,
air-conditioning, sprinkler and electrical systems within the Buildings
(“Building Systems”) and the Parking Areas, as and to the extent necessary to
keep them in their condition as of the Effective Date, reasonable wear and tear,
casualty and condemnation excepted (such condition, the “Surrender Condition”),
and, subject to the limitations set forth in Section 6.2, in compliance with all
applicable Legal Requirements and Insurance Requirements. Notwithstanding the
foregoing, Tenant’s obligations to repair the Premises shall include only
ordinary non-capital repairs ancillary to Tenant’s maintenance and preservation
obligations, but shall not include (i) extraordinary repairs, or repairs or
replacements the expenditure for which would be considered a “capital
expenditure” or “capital expense” under generally accepted accounting
principles, (ii) structural replacements or improvements, (iii) repairs or
replacements that could reasonably be deferred until expiration of the Term
without causing waste or degradation of the condition of the Premises below the
Surrender Condition, (iv) repairs or replacements that are covered by insurance
maintained or required to be maintained by Landlord, and (v) repairs or
replacements arising as a consequence of casualty or condemnation. Tenant shall
perform its foregoing obligations to operate, clean, maintain, repair, and
preserve the Premises to the standard of similar first-class office buildings in
the geographical area of the Buildings. To the extent possible, Landlord will
cause Tenant to have the benefit of any guaranty or warranty to which Landlord
is entitled relating to components of the Premises that Tenant is required to
operate, maintain, repair, and preserve. The foregoing does not nullify or
modify the Tenant’s obligation to pay to Landlord “Expenses” incurred by
Landlord to the extent such payment is required under the terms of Sections 9.3
and 9.4 below (including the obligation to pay the amortized portion of capital
expenditures that are incurred by Landlord and that are allocable to the Term of
this Lease).

 

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9.2 Landlord shall at its expense (but subject to Sections 9.3 and 9.4 below),
maintain and repair the structural portions of the Buildings to the extent that
such maintenance and repairs constitute extraordinary repairs, or repairs or
replacements the expenditure for which would be considered a “capital
expenditure” or “capital expense” under generally accepted accounting
principles, including, without limitation, all portions of the roof, roof
structures and supports, the foundation and structural supports, exterior and
load bearing walls, subfloors and floors (but not floor coverings), the Building
Systems and standard conduits, connections and distribution systems thereof
within the Premises (but not any Support Equipment or Tenant’s Property) to the
standard of similar first-class office buildings in the geographical area of the
Buildings and in compliance with all applicable Legal Requirements and Insurance
Requirements. Landlord’s obligations under this Section 9.2 shall not include
maintenance and repairs within the scope of Tenant’s maintenance, repair and
preservation obligations set forth in Section 9.1. Except in the case of
maintenance and repairs that must be performed on an emergency basis or that are
requested in writing by Tenant, Landlord shall give Tenant advance written
notice of at least twenty (20) days prior to performing any maintenance or
repair under this Section 9.2. Unless otherwise approved by Tenant in writing,
Landlord shall defer any or all maintenance, repairs or replacements that could
reasonably be deferred until expiration of the Term without causing waste,
degradation of the condition of the Premises below the Surrender Condition or
imposition on Landlord of a fine, penalty or loss of insurance coverage based on
noncompliance with applicable Legal Requirements or Insurance Requirements.
Landlord shall not be permitted to make alterations or improvements to the
Premises during the Term or perform maintenance or repairs that are not required
under this Section 9.2, except following not less than 30 days’ prior written
notice during the last twelve (12) months of the Term, if Tenant has waived its
Extension Option in writing, or during the last twelve (12) months of the
Extension Period, and then, in each such case, only in a manner that does not
interfere with or disturb Tenant’s access, use, occupancy and quiet enjoyment of
the Premises.

9.3 Subject to Section 6.2 and except as provided in Section 9.4 below:
(i) actual out of pocket expenses incurred by Landlord in the performance of
Landlord’s obligations under Section 9.2 (but not including any maintenance,
repairs or replacements to be deferred until expiration of the Term under the
standards set forth in Section 9.2) shall be “Expenses” and (ii) shall be paid
or reimbursed to Landlord by Tenant as Additional Rent on the first calendar day
of each month during the Term (provided written demand for payment accompanied
by reasonably detailed supporting documentation of such Expenses is made to
Tenant at least thirty (30) days prior to such 1st calendar day, otherwise on
the 1st calendar day of the next month and further provided that the amortized
portion of any capital expenditure allocable to the Term and permitted to be an
Expense shall be due and payable in monthly installments during the remaining
Term and not as a lump sum) and such Expenses may include, without limitation,
the following:

(a) All supplies, materials and tools used exclusively in connection with the
Premises and the performance of Landlord’s obligations under Section 9.2;

 

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(b) The cost of repair (but not replacement) of the Chiller, but only to the
extent required to keep the Chiller fully and properly operational during the
Term;

(c) The cost of any capital expenditure made to the Premises by Landlord after
the date of this Lease which are required by Legal Requirements or Insurance
Requirements that were not in effect as of the Effective Date or, subject to
Section 9.4(c), to keep the Premises in a safe condition or in the Surrender
Condition; provided that, the cost of any such capital expenditure or
improvement shall be amortized on a straight-line basis over the useful life (as
determined by Landlord) of such capital expenditure or improvement following
such repair or replacement, together with interest at the Prime Rate plus two
percent (2%) per annum on the unamortized balance thereof from time to time, and
only the amortized portion of such expenditure, plus interest, during the Term
will constitute an “Expense” hereunder; provided, further however that any
capital expenditure or improvement which costs less than $25,000 shall be
expensed in the year in which incurred and treated as “Expenses” in such year;
and

(d) The cost of licenses, certificates, permits and inspections for the
performance of obligations required to be performed by Landlord under
Section 9.2.

9.4 Notwithstanding anything to the contrary, the following items shall be
excluded from Expenses and Tenant shall not be charged or required to reimburse
Landlord therefor under any provision of this Lease:

(a) Expenses for repairs or replacements that reasonably could be deferred until
expiration of the Term (or, as applicable, the Extension Term) while maintaining
the Surrender Condition described in (and pursuant to) Section 9.1 and without
causing waste to the Premises, degradation of the condition of the Premises
below the Surrender Condition or imposition on Landlord of a fine or penalty or
resulting in the loss of insurance based on noncompliance with Legal
Requirements or Insurance Requirements;

(b) Expenses that are not incurred for the performance of obligations required
to be performed by Landlord under Section 9.2;

(c) Expenses for replacements of components or items that reasonably could be
repaired at a lower cost;

(d) Wages, salaries, and any and all taxes, insurance and benefits of any
property manager or other management employees of or employed by Landlord or any
Landlord Affiliate;

(e) Any capital costs and expenses, including, without limitation, any, capital
replacements, capital repairs or other capital items, that are not expressly
permitted to be included as Expenses under Section 9.3 above;

(f) Costs or expenses of repairs made in connection with casualty or
condemnation; costs or expenses of repairs and restoration paid for by the
proceeds of any insurance policies and costs or expenses that would be
reimbursable under insurance required to be maintained by Landlord under this
Lease;

 

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(g) Financing costs or depreciation;

(h) The costs resulting from Hazardous Materials which (i) existed on the
Property on or before the Effective Date (except to the extent any such
condition is exacerbated by Tenant or any Tenant Parties), and/or (ii) were
placed within the Property by Landlord or Landlord Parties;

(i) Interest and penalties resulting from Landlord’s failure to pay Expense when
due; and

(j) Costs or expenses arising from the gross negligence or willful misconduct of
Landlord or Landlord Parties.

(k) Depreciation or amortization of the Buildings or equipment in the Buildings;

(l) Loan principal and interest payments;

(m) Amounts constituting either or both the deductible portion of insurance or
self-insured risks;

(n) Costs or expenses (including fines, penalties and legal fees) incurred due
to the violation by Landlord or any Landlord Parties of any terms and conditions
of this Lease, or of any applicable laws that would not have been incurred but
for such violation; and

(o) Penalties for any late payment by Landlord, including, without limitation,
taxes and equipment leases.

9.5 If Tenant disputes the amount of any Expenses for which Landlord is
requesting payment or reimbursement from Tenant, Tenant may inspect and copy
Landlord’s books and records relating to the Premises and, in addition, may at
its sole expense, except as provided below, designate a consultant to do so who
must be a member of a reputable accounting firm or management company and must
not charge a fee based on the amount of Expenses that such consultant is able to
save the Tenant. Tenant shall give not less than seven (7) days’ prior written
notice to Landlord of the request for inspection, and the inspection must be
conducted in Landlord’s offices during normal business hours. Tenant and such
consultant shall maintain in strict confidence any and all information obtained
in connection with the review and shall not disclose any such information to any
person or entity other than to management personnel of Tenant, except for
(i) information that is or becomes available to the public other than as a
result of a disclosure pursuant to this Section 9.5, (ii) information that is or
becomes available to Tenant on a non-confidential basis from another source
which, to the best of Tenant’s knowledge, is not subject to a confidentiality
agreement with Landlord, (iii) information that is or was known by Tenant prior
to its disclosure by Landlord, (iv) disclosures required by applicable law,
subpoena or any court, agency, regulatory or supervisory authority having
jurisdiction or (v) disclosures required in connection with the enforcement of
Tenant’s rights under this Lease. The period during which Tenant or its
consultant may inspect and copy

 

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Landlord’s books and records shall end on the ninetieth (90th) day following the
date on which Tenant or its consultant shall have begun its inspection and
Landlord shall have provided Landlord’s books and records relating to such
Expenses and payment or reimbursement request to Tenant or its consultant for
inspection and copying. If, after any such inspection, Tenant still disputes any
such Expense payment or reimbursement request, and if Landlord disagrees with
the results of Tenant’s review, then Landlord and Tenant shall together select a
neutral auditor having not less than ten (10) years’ experience in managing or
auditing properties of a type similar to the Premises and who is otherwise
qualified to conduct a review of such books and records (the fees of such
neutral auditor to be shared equally by Landlord and Tenant), and the
determination of Expenses reached by such neutral auditor shall be final and
conclusive. If the parties do not agree on such selection within fifteen
(15) days following written notice by Tenant to Landlord of its election to
cause such an auditor to conduct such review, then Tenant may request
appointment of such an auditor by the American Arbitration Association (or any
successor organization thereto) in accordance with its rules then prevailing, or
if the American Arbitration Association (or such successor organization) shall
fail to appoint such auditor within fifteen (15) days after such request is
made, then Tenant may apply, on notice to Landlord, to any court having
jurisdiction for the appointment of such auditor. If the amounts paid by Tenant
to Landlord on account of Expenses exceed the amounts to which Landlord is
entitled hereunder, then Landlord shall, upon its final determination, credit
the amount of such excess toward the next monthly payment(s) of Rent due
hereunder. All costs and expenses of any such review shall be paid by Tenant;
provided, however, that if the aggregate amount of Expenses set forth in any
such statement was overstated by Landlord by more than five percent (5%),
Landlord shall reimburse Tenant for the commercially reasonable, out of pocket
hourly or flat fee costs and expenses paid by Tenant in connection with Tenant’s
review and, if applicable, the costs of causing the appointment of and review by
such auditor. Notwithstanding anything to the contrary stated in this Lease,
Tenant shall not be permitted or have the right to challenge any particular
Expense (or inspect Landlord’s books and records with respect to any such
Expense) if Tenant fails to deliver to Landlord written notice either
challenging such Expense or requesting access to Landlord’s books and records
with respect to such Expense in connection with a potential challenge within
ninety (90) days after Landlord first delivers to Tenant its demand for payment
of such Expense. Tenant will diligently pursue any such inspections and
challenges permitted hereinabove in an expeditious manner.

9.6 Except as otherwise expressly provided in this Lease, Tenant hereby waives
all rights it would otherwise have under California Civil Code Sections 1932(1)
and 1942(a) or any successor statutes to deduct repair costs from rent and/or
terminate this Lease as the result of any failure by Landlord to maintain,
repair or replace the Premises. If Landlord fails to perform any of its repair,
replacement and maintenance obligations under Section 9.2 or otherwise as
required in this Lease, and such failure materially affects Tenant’s ability to
use and occupy the Premises for the purposes permitted herein, Tenant shall have
the right, but not the obligation, to perform such repairs, replacements and/or
maintenance if such failure continues for more than ten (10) days after the
second written notice from Tenant to Landlord; provided, however, that if the
nature of the repairs, replacements and/or maintenance to be completed by
Landlord is such that more than ten (10) days are reasonably required to
complete such repairs, replacements and/or maintenance, then Landlord shall have
such additional time as is reasonably necessary to complete such repairs,
replacements and/or maintenance so long as Landlord takes

 

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appropriate action to commence such repairs, replacements and/or maintenance
within such ten (10) day period and thereafter diligently pursues such repairs,
replacements and/or maintenance to completion. In such event, Landlord shall
reimburse Tenant for the reasonable costs incurred by Tenant to complete such
repairs, replacements and/or maintenance within ten (10) days after receipt of
Tenant’s written demand therefor and supporting documentation evidencing such
expenditures, together with interest thereon at the Default Rate from the date
such expenditures are made by Tenant until paid by Landlord. In the event of an
emergency, Tenant shall be empowered to undertake immediate repairs of such
nature as would be Landlord’s responsibility and notify Landlord promptly after
such repairs have been undertaken and seek reimbursement from Landlord as
provided herein.

10. MECHANICS’ AND OTHER LIENS. Tenant shall not suffer or permit any mechanics’
or other liens to be recorded or filed against the Premises or any part thereof
or against the interests therein of Landlord or Tenant as a result of any work
performed by or on behalf of Tenant during the Term. If any such lien shall at
any time be recorded or filed against the Premises or any such interest therein,
Tenant shall cause the same to be discharged of record within thirty (30) days
after Tenant receives notice of the recording or filing of the same. Tenant
shall have the right, after notice to Landlord, to contest by appropriate legal
proceedings, diligently conducted in good faith, the amount or validity of any
such mechanics’ or other lien filed against the Premises, provided that such
contest shall not abrogate Tenant’s obligation to cause such lien to be
discharged of record as provided in this Section 10. Tenant agrees to indemnify,
defend and hold Landlord harmless from and against any losses or costs to, or
penalties incurred by, Landlord arising from Tenant’s contesting any mechanics’
or other lien filed against the Premises or any part thereof or against the
interest therein of Landlord or Tenant’s failure to cause the same to be
discharged of record within thirty (30) days after Tenant receives notice of the
recording or filing of the same. Tenant’s obligations under this Section 10
shall survive the expiration or earlier termination of this Lease.

11. ALTERATIONS

11.1 Title to all improvements constructed by Tenant within the Premises
following the Commencement Date shall be and remain in Tenant for and during the
entire Term of this Lease, and on the expiration or earlier termination of this
Lease, Tenant hereby covenants and agrees that the sole right to possess and use
the same (but not Tenant’s Property) shall automatically pass to and be vested
in Landlord without payment or consideration of any kind, unless Landlord
provides Tenant with written notice at the time Landlord approves such
improvements, that Landlord shall require Tenant to remove such improvements (or
a specified portion thereof) at its sole cost and expense prior to the
expiration of the Term, or to the extent permitted under the terms of this Lease
any earlier termination of the Term, provided that Tenant is afforded a
reasonable advance notice of such earlier termination to effect such removal.

11.2 Tenant shall have the right, at any time and from time to time during the
Term of this Lease, to make, at its sole cost and expense Alterations to the
Premises, subject, however, in all cases, to the following:

(a) All Alterations shall be made promptly in a good and workmanlike manner on a
lien-free basis and in compliance with all applicable Legal Requirements, and
any national or local Insurance Rating Bureau, or any other body hereafter
exercising similar functions.

 

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(b) The cost of all Alterations shall be paid by Tenant, so that the Property
shall at all times be free from all liens for labor and material supplied or
claimed to have been supplied to the Premises and free from all liens,
encumbrances or security interests.

(c) Tenant shall not make any Alterations (i) to any portion of the Property
described in Section 9.2, without Landlord’s prior written approval (including
approval of all plans and specifications) to be given or withheld in Landlord’s
sole and absolute discretion, (ii) to the exterior of the Buildings or Property
if such Alterations would change the appearance of the Property or any part
thereof, or (iii) that are not included in clauses (i) or (ii) above but cost
more that Fifty Thousand Dollars ($50,000) without Landlord’s prior written
approval (including approval of all plans and specifications, if any), which
approval shall not be unreasonably withheld, conditioned or delayed. Within
fifteen (15) days after the receipt of plans and specifications from Tenant
requiring Landlord’s approval, Landlord shall notify Tenant in writing of its
approval of the plans and specifications or the reasons for its rejection
thereof. Landlord shall be deemed to have approved such plans and specifications
or such Alterations if it fails to give Tenant a rejection notice within fifteen
(15) days after receipt by Landlord of Tenant’s plans and request for approval.

11.3 Except as expressly set forth in this Lease, Landlord shall have no right
to make any Alterations to the Premises (as distinguished from repairs and
maintenance) without the prior written consent of Tenant, which consent Tenant
may grant or withhold in its reasonable discretion.

11.4 Landlord, at Tenant’s sole cost and expense, shall provide reasonable
cooperation with Tenant with respect to Tenant’s efforts to secure building and
other permits or authorizations that may be required from time to time by Tenant
in connection with the performance of any Alterations. Any reasonable costs
incurred by Landlord in connection with Landlord’s (or Landlord’s construction
consultant’s) review of any plans submitted to Landlord by Tenant shall be paid
by Tenant as Additional Rent upon thirty (30) days written demand therefore by
Landlord.

12. INSURANCE

12.1 At all times during the Term hereof, Tenant shall, keep in full force and
effect:

(a) a policy of commercial general public liability insurance with respect to
the Premises, and the business operated by Tenant in the Premises, in which the
primary coverage per accident or occurrence is not less than Five Million
Dollars ($5,000,000.00) combined single limit; and

(b) a policy of “all-risk” insurance so as to cause all of the Tenant Property
to be insured against loss or damage by fire, wind, sprinkler leakage,
vandalism, malicious mischief, flood and such other hazards as are from time to
time included in a standard

 

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extended coverage endorsement, in an amount and form so that the proceeds
thereof are sufficient to provide for actual replacement in full of the Tenant
Property (i.e., full replacement cost).

Nothing in this Section 12 shall prevent Tenant from carrying any of the
insurance required of Tenant hereunder in the form of self-insurance (provided
Tenant shall have liquid assets of One Hundred Million Dollars ($100,000,000) or
more), or blanket policies of insurance.

12.2 At all times during the Term hereof, subject to Section 12.5 below,
Landlord shall keep in full force and effect:

(a) a policy of commercial general public liability insurance with respect to
the Property, in which the primary coverage per accident or occurrence is not
less than Five Million Dollars ($5,000,000.00) combined single limit; and

(b) policy of insurance “all-risk” so as to cause all of the Buildings and other
improvements located within the Property to be insured against loss or damage by
fire, wind, sprinkler leakage, earthquake, terrorist acts, vandalism, malicious
mischief, flood and such other hazards as are from time to time included in a
standard extended coverage endorsement, in an amount and form so that the
proceeds thereof are sufficient to provide for actual replacement in full of the
Buildings and improvements (i.e., full replacement cost). Such coverage shall
include rental loss coverage for a period of at least twelve (12) months.
Landlord shall have no obligation to insure, and shall not be responsible for,
Tenant’s Property.

12.3 With respect to the insurance policies maintained by Landlord and Tenant
pursuant to Sections 12.1 and 12.2, respectively, each party shall look first to
any insurance in its favor before making any claim against the other party for
recovery for loss or damage resulting from fire or other casualty and, to the
extent permitted by law, Landlord and Tenant each hereby releases and waives, to
the extent that the party sustaining such loss is compensated for such loss by
insurance, all right of recovery against the other or anyone claiming through or
under each of them by way of subrogation or otherwise.

12.4 Tenant (and Landlord, if Landlord has any employees), shall maintain
(i) Worker’s Compensation insurance as required by any applicable law or
regulation and in accordance with the laws of the state, territory or province
having jurisdiction over Tenant’s employees, (ii) Employer’s Liability insurance
with limits of One Million Dollars ($1,000,000) and (iii) Business Automobile
Liability insurance covering all owned, rented (hired) and non-owned vehicles
used in connection with this Lease or the Premises having limits of One Million
Dollars ($1,000,000) each accident for bodily injury and property damage.

12.5 The policies required under Section 12.1(b) and Section 12.2(b) shall
permit the waivers set forth in Section 12.3, and the policies required under
Sections 12.1(a) and 12.4 shall name Landlord, Landlord Parties and Landlord’s
lender as additional insureds with respect to liability arising out of the
activities of Tenant, shall be deemed primary coverage as to any insurance
carried by Landlord and such other additional insureds, and shall contain a
clause that the insurer will not cancel or materially change the insurance
without first giving the Landlord thirty (30) days prior written notice. A copy
of the certificates of the insurers

 

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evidencing the maintenance of such insurance policies shall be delivered to
Landlord and Tenant, as applicable, prior to the Commencement Date, and, upon
renewals, no later than 21 days after the expiration of a coverage period.

12.6 All insurance required hereunder shall be issued by insurance companies
having a rating of not less that A-VIII in Best’s Insurance Guide (or which is
otherwise acceptable to the non-insuring party hereunder) and licensed to do
business in the State of California. If Tenant fails to procure and maintain any
insurance required to be procured and maintained by Tenant pursuant to this
Lease, or to deliver certificates of insurance as required by this Lease,
Landlord may, at its option, procure such insurance policies for the account of
Tenant, and the cost thereof shall be paid to Landlord as Additional Rent within
five (5) days after delivery to Tenant of the bills therefore.

12.7 Expenses for insurance required to be maintained by Landlord under this
Section 12 shall be reimbursed by Tenant within ten (10) days following written
notice by Landlord containing an invoice of the amount thereof, accompanied by
reasonable supporting documentation for all such insurance premium Expenses. All
insurance required to be maintained by Tenant under this Lease shall be
maintained at Tenant’s sole cost and expense.

13. DAMAGE OR DESTRUCTION

13.1 If, at any time during the Term, the Premises (including, without
limitation, any of the Buildings or other improvements therein or thereon) or
any part thereof (collectively, the “Damaged Property”) is damaged by fire,
earthquake, flood or by any other casualty of any kind or nature (a “Casualty”)
then, unless this Lease is terminated as hereinafter provided in this
Section 13.1, Landlord shall proceed diligently to rebuild or restore the
Damaged Property at Landlord’s sole cost and expense; provided, that, in no
event shall Damaged Property include, nor shall Landlord or Tenant have any
obligation to rebuild or restore, any of the Tenant Property (unless such
Casualty is caused by the gross negligence or willful misconduct of Landlord).
Such rebuilding and restoration work required of Landlord is herein collectively
called “Landlord’s Restoration Work.” If any Casualty shall render the Premises
completely or partially Untenantable for any period, then, provided that such
Casualty was not caused by the gross negligence or willful misconduct of Tenant
or any Tenant Parties, Basic Rent shall be abated (in the proportion that the
rentable portion of the Untenantable area of the Premises bears to the total
rentable area of the Premises for the period of such untenantability) until
(10) days after the date that the Premises (or such portion thereof) is no
longer Untenantable and Landlord has given written notice to Tenant that the
Premises have again been rendered fully tenantable and a certificate of
occupancy for the Premises, as restored following such fire or other casualty,
has been obtained (if such certificate is required by applicable law). The term
“Untenantable,” when used with respect to the Premises, or any portions thereof,
shall mean that the Premises, or any portion thereof, is not reasonably capable
of being used by Tenant for its intended purpose or that the continuance of
Tenant’s business from the Premises is impractical (as reasonably determined by
Tenant). Within thirty (30) days following any Casualty, Landlord shall cause to
be prepared and delivered to Tenant a written estimate of the date by which the
Landlord’s Restoration Work necessitated by Casualty shall be completed (which
estimate shall be prepared by an independent reputable contractor, registered

 

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architect or licensed professional engineer designated by Landlord, and
reasonably approved by Tenant) (such estimate being herein called the
“Restoration Completion Estimate”). If the Restoration Completion Estimate is a
date later than the date that is one hundred eighty (180) days after the date of
the Casualty, or the Casualty occurs during the last one hundred twenty
(120) days of the Term (as may be extended by the Extension Option), then,
provided that such Casualty was not the direct or indirect result of Tenant’s or
any Tenant Party’s negligence or willful misconduct, Tenant may elect to
terminate this Lease by providing Landlord written notice no later than thirty
(30) days following the delivery of the Restoration Completion Estimate to
Tenant or, in the case of a Casualty occurring in the last one hundred twenty
(120) days of the Term (as may be extended by the Extension Option), within
thirty (30) days after the occurrence of such Casualty. If (i) the Restoration
Completion Estimate is a date later than the date that is one hundred eighty
(180) days after the date of the Casualty, (ii) the Casualty is the result of a
risk that is not covered by Landlord’s insurance (provided that Landlord has
procured and maintained the insurance required under Section 12.2(b) of this
Lease), (iii) the amount of insurance proceeds payable to and received by
Landlord as a result of such Casualty plus the applicable deductable are
insufficient to compete Landlord’s Restoration Work (provided that Landlord has
procured and maintained the insurance required under Section 12.2(b) of this
Lease) or (iv) the Casualty occurs during the last one hundred twenty (120) days
of the Term (as may be extended by the Extension Option), then Landlord may
elect to terminate this Lease by providing Tenant written notice no later than
fifteen (15) days following the delivery of the Restoration Completion Estimate
to Tenant (in the case of clause (i)), fifteen (15) days after the insurer
finally denies coverage or settles the insurance claim (in the case of clauses
(ii) and (iii)), and fifteen (15) days after the occurrence of the Casualty (in
the case of clause (iv)).

13.2 If a Casualty occurs and the Lease is not terminated in accordance with the
terms of Section 13.1 above, then Landlord shall commence and diligently pursue
to completion Landlord’s Restoration Work. If Landlord fails to substantially
complete Landlord’s Restoration Work (it being understood that in no event shall
Landlord’s Restoration Work be deemed substantially completed unless and until
the Premises are no longer Untenantable and the common areas functional for all
purposes hereunder) on or prior to the Outside Completion Date, then Tenant may
terminate this Lease (or Tenant may reduce the total area of the Premises by
removing the Building affected by such Casualty, if only one Building within the
Premises is affected by such Casualty) and in the event of such termination (or
Premises reduction), all Rent shall be prorated and adjusted as of the date of
such termination (or Premises reduction), subject to the abatement provisions
herein-above set forth) by delivering written notice to Landlord within thirty
(30) days after the Outside Completion Date, but before Landlord’s Restoration
Work shall have been substantially completed. If Tenant fails to deliver such
notice within such thirty (30) day period, then Tenant shall have waived its
right to terminate this Lease under this Section 13.2 for a period of two
(2) months; after which 2-month period, such right shall again be available, on
the same terms, if the Landlord’s Restoration Work is still not substantially
completed. The provisions of the two immediately preceding sentences shall be
implemented repeatedly until the Landlord’s Restoration Work is substantially
completed or this Lease is terminated as therein provided. The term “Outside
Completion Date” shall mean the later of (x) the date that is 180 days after the
Casualty occurred and (y) the date of the Restoration Completion Estimate.
Tenant shall be solely obligated to repair and restore Tenant Property at its
sole cost and expense, unless damage thereto is caused by the gross negligence
or willful misconduct of Landlord.

 

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13.3 Landlord and Tenant agree that the foregoing provisions of this Section 13
are to govern their respective rights and obligations in the event of any damage
or destruction and supersede and are in lieu of the provisions of any applicable
law, statute, ordinance, rule, regulation, order or ruling now or hereafter in
force which provide remedies for damage or destruction of Premises (including,
without limitation, the provisions of California Civil Code Section 1932,
Subsection 2, and Section 1933, Subsection 4 and any successor statute or laws
of a similar nature).

14. CONDEMNATION

14.1 If all of the Premises is condemned by eminent domain, inversely condemned
or sold in lieu of condemnation for any public or quasi-public use or purpose (a
“Condemnation”), this Lease shall terminate as of the earlier of the date of
title vesting in such proceeding or the date Tenant vacates the Premises, and
Base Rent and Additional Rent hereunder shall be adjusted to the date the Lease
is terminated.

14.2 If a Condemnation affects a portion of the Premises as would render the
continuance of Tenant’s business from the Premises impracticable (as reasonably
determined by Tenant), then Tenant shall have the option of terminating this
Lease upon the giving of notice to Landlord within thirty (30) days from the
date of such condemnation or taking and this Lease shall terminate as of the
earlier of the date of title vesting in such proceeding or the date Tenant
vacates the Premises, and Base Rent and Additional Rent hereunder shall be
adjusted to the date the Lease is terminated.

14.3 If any such Condemnation of a portion of the Premises occurs and this Lease
is not terminated under Section 14.1 or Section 14.2, then within thirty
(30) days following any Condemnation, Landlord shall cause to be prepared and
delivered to Tenant a written estimate of the date by which restoration work to
the remaining portions Premises (including the Buildings and the parking and
other common areas and structures, but not including, in any event, any Tenant
Property) can be completed so that such remaining portion of the Premises and
the Buildings thereon each shall constitute a complete architectural unit,
reasonably fit for Tenant’s occupancy and business as reasonably determined by
Tenant (which estimate shall be prepared by an independent reputable contractor,
registered architect or licensed professional engineer designated by Landlord,
and reasonably approved by Tenant) (such estimate being herein called the
“Condemnation Restoration Completion Estimate”). If the Condemnation Restoration
Completion Estimate is a date later than the date that is one hundred twenty
(120) days after the date of the Condemnation, or the Condemnation occurs during
the last one hundred twenty (120) days of the Term (as may be extended by the
Extension Option), then, Landlord or Tenant each may elect to terminate this
Lease by providing written notice to the other no later than thirty (30) days
following the delivery of the Condemnation Restoration Completion Estimate to
Tenant or, in the case of a Condemnation occurring in the last one hundred
twenty (120) days of the Term (as may be extended by the Extension Option),
within thirty (30) days after the occurrence of such Condemnation. If this Lease
is not terminated under this Section 14.3, Landlord shall, within sixty
(60) days after the date of such condemnation or

 

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taking, commence such restoration work to the remaining portions of the Premises
(including the Buildings and the parking and other common areas and structures,
but not including, in any event, any Tenant Property) as shall be needed so that
such remaining portion of the Premises and the Buildings thereon each shall
constitute a complete architectural unit, reasonably fit for Tenant’s occupancy
and business as reasonably determined by Tenant. If Landlord fails to cause such
restoration work to be substantially completed within the later of (x) 180 days
after the Condemnation and (y) the Condemnation Restoration Completion Estimate,
for any reason other than a delay caused by an act or omission of Tenant, and
such failure materially interferes with Tenant’s use and occupancy of the
Premises (as reasonably determined by Tenant), then Tenant shall have the right
to terminate this Lease by notifying Landlord in writing of such termination
within thirty (30) days after such outside date for completion of such
restoration.

14.4 If this Lease is terminated as provided in Section 14.1, Section 14.2 or
Section 14.3, then this Lease shall cease and expire as to such Premises as of
the date of transfer of possession of the Premises, the Property, or the
applicable portion thereof, as if such date was the expiration date of this
Lease.

14.5 If, upon any Condemnation of a portion of the Premises, this Lease is not
terminated by either Landlord or Tenant, then Tenant shall pay all Basic Rent up
to the date of transfer of possession of such portion of the Premises so taken
or condemned and this Lease shall thereupon cease and terminate with respect to
such portion of the Premises so taken or condemned as if the date of transfer of
possession of the Premises was the expiration date of the Term relating to such
portion of the Premises. Thereafter, the Basic Rent and Additional Rent shall be
calculated based on the net rentable area of the Premises not so taken or
condemned and Tenant shall remain responsible only for Basic Rent and Additional
Rent applicable to the remaining portion of the Premises.

14.6 All compensation awarded for any taking (or the proceeds of private sale in
lieu thereof) of the Property shall be the property of Landlord, and Tenant
hereby assigns its interest in any such award to Landlord; provided, however,
Landlord shall have no interest in any award made to Tenant for the taking of
any Tenant Property or moving expenses if a separate award for such items is
made to Tenant. If this Lease is terminated as a result of any such exercise of
the power of eminent domain, Rent shall be payable up to the date that
possession is taken by the condemning authority; Landlord shall refund to Tenant
any prepaid unaccrued Rent, less any sum then owing by Tenant to Landlord; and
Tenant shall have no claim against Landlord for the value of any unexpired
portion of the Term.

14.7 If (i) any taking or condemnation for any public purpose is of a portion
(but less than all) of the Premises or any portion thereof, and (ii) the same
occurs for only a period of ninety (90) days or less, then such taking or
condemnation shall be deemed a temporary taking and this Lease shall continue in
full force and effect, except that, throughout the period of such temporary
taking, Basic Rent, shall be calculated based on the net rentable area of the
Premises not so taken.

14.8 Tenant hereby waives any and all rights it might otherwise have pursuant to
Section 1265.130 of the California Code of Civil Procedure.

 

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15. DEFAULT BY TENANT

15.1 If, at any time during the Term, any one or more of the following events
(each of which being herein called an “Event of Default”) shall occur, to wit:

(a) Tenant fails to pay when due any sum required to be paid hereunder which is
not received by Landlord when due and such failure shall continue for a period
of five (5) business days after the date on which Landlord gives Tenant written
notice of such failure (a “Monetary Default”); or

(b) Tenant fails to perform or observe any of Tenant’s obligations, covenants,
or agreements (other than a Monetary Default) to be performed or observed by
Tenant under this Lease and such failure shall continue for thirty (30) days
after notice thereof from Landlord to Tenant, except that if such failure
cannot, because of Unavoidable Delays or otherwise, be cured within such thirty
(30) day period, and if Tenant shall have commenced to cure such failure within
such thirty (30) day period or as soon as reasonably feasible following an
Unavoidable Delay, and continues to prosecute such cure with reasonable
diligence thereafter, then the time to cure such failure shall be extended for
such period as may be necessary to complete such cure with reasonable diligence,
subject to Unavoidable Delays; or

(c) Tenant admits in writing that it cannot meet its obligations as they become
due; or is declared insolvent according to any applicable Legal Requirement; or
an assignment of Tenant’s property is made for the benefit of creditors; or a
receiver or trustee is appointed for Tenant or a substantial portion of its
property; or the interest of Tenant under this Lease is levied on under
execution or other legal process; or any petition is filed by or against Tenant
or Guarantor to declare Tenant bankrupt; or any petition is filed or other
action taken to reorganize or modify Tenant’s or Guarantor’s capital structure
if Tenant is a corporation or other entity. Any such levy, execution, legal
process, or petition filed against Tenant or Guarantor shall not constitute a
breach of this Lease provided Tenant or Guarantor shall contest the same by
appropriate proceedings and shall remove or vacate the same within sixty
(60) days from the date of its creation, service, or filing; or

(d) Tenant ceases to exist as a corporation.

15.2 In the event of any Event of Default by Tenant, Landlord, at its option,
may pursue one or more of the following remedies without notice or demand in
addition to all other rights and remedies provided for at law or in equity:

(a) Upon an Event of Default, Landlord may, at its option, terminate this Lease
by written notice to Tenant and recover possession of the Premises. No act by
Landlord (including, without limitation, acts of maintenance, efforts to relet
the Premises, or the appointment of a receiver on Landlord’s initiative to
protect Landlord’s interest under the Lease) other than giving written notice to
Tenant shall terminate this Lease. Following such termination, Landlord may
recover from Tenant damages arising from the Event of Default and the
termination of this Lease, including without limitation the following:

(i) The Worth at the Time of Award of the unpaid Rent which had been earned at
the time of termination; plus

 

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

(iii) The Worth at the Time of Award of the amount by which the unpaid Rent for
the balance of the Term after the time of award exceeds the amount of such
rental loss that Tenant proves could be reasonably avoided; plus

(iv) any other amount necessary to compensate Landlord for all detriment
proximately caused by Tenant’s failure to perform Tenant’s obligations under
this Lease, or which, in the ordinary course of things, would be likely to
result therefrom.

As used in Sections 15.2(a)(i) and 15.2(a)(ii) above, the “Worth at the Time of
Award” shall be computed by allowing interest at the Default Rate. As used in
Section 15.2(a)(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 five percent (5%).

(b) Landlord shall have the remedy, described in California Civil Code 1951.4
(Landlord may continue the lease in effect after lessee’s breach and abandonment
and recover rent as it becomes due, if lessee has the right to sublet or assign,
subject only to reasonable limitations).

15.3 If Landlord shall exercise any one or more remedies hereunder granted or
otherwise available, it shall not be deemed to be an acceptance or surrender of
the Premises by Tenant whether by agreement or by operation of law; it is
understood that such surrender can be effected only by the written agreement of
Landlord and Tenant.

15.4 Each right and remedy provided for in this Lease shall be cumulative and
shall be in addition to every other right or remedy provided for in this Lease
or now or hereafter existing at law or in equity or by statute or otherwise,
including, but not limited to, suits for injunctive relief and specific
performance. The exercise or beginning of the exercise by Landlord of any one or
more of the rights or remedies provided for in this Lease or now or hereafter
existing at law or in equity, or by statute or otherwise shall not preclude the
simultaneous or later exercise by Landlord of any or all other rights or
remedies provided for in this Lease or now or hereafter existing at or in equity
or by statute or otherwise. All such rights and remedies shall be considered
cumulative and non-exclusive. All costs incurred by Landlord in connection with
collecting any Rent or other amounts and damages owing by Tenant pursuant to the
provisions of this Lease, or to enforce any provision of this Lease, including
reasonable attorneys’ fees from the date such matter is turned over to an
attorney, whether or not one or more actions are commenced by Landlord, shall
also be recoverable by Landlord from Tenant. If any notice and grace period
required under Section 15.1(a) or Section 15.1(b) was not previously given, a
notice to pay rent or quit, or to perform or quit, as the case may be, given to
Tenant under any statute authorizing the forfeiture of leases for unlawful
detainer shall also constitute the applicable notice for grace period purposes
required by Section 15.1(a) or

 

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Section 15.1(b). In such case, the applicable grace period under Section 15.1(a)
or Section 15.1(b) and under the unlawful detainer statute shall run
concurrently after the one such statutory notice, and the failure of Tenant to
cure the default within the greater of the two (2) such grace periods shall
constitute both an unlawful detainer and an Event of Default entitling Landlord
to the remedies provided for in this Lease and/or by said statute.

15.5 Notwithstanding anything contained in this Section 15 to the contrary, any
proceeding or action involving bankruptcy, insolvency, reorganization,
arrangement, assignment for the benefit of creditors, or appointment of a
receiver or trustee, as set forth above, shall be considered to be an Event of
Default only when such proceeding, action, or remedy shall be taken or brought
by or against the then holder of the leasehold estate under this Lease.

15.6 No endorsement or statement on any check or letter of Tenant shall be
deemed an accord and satisfaction or recognized for any purpose whatsoever. The
acceptance of any such check or payment shall be without prejudice to Landlord’s
rights to recover any and all amounts owed by Tenant hereunder and shall not be
deemed to cure any other default nor prejudice Landlord’s rights to pursue any
other available remedy, Landlord’s acceptance of partial payment of rent does
not constitute a waiver of any rights, including without limitation any right
Landlord may have to recover possession of the Premises.

15.7 Landlord’s failure to perform any of its obligations under this Lease shall
constitute a default by Landlord under this Lease if the failure continues for
thirty (30) days after written notice of the failure from Tenant to Landlord. If
the required performance cannot be completed within thirty (30) days, Landlord’s
failure to perform shall constitute a default under the Lease unless Landlord
undertakes to cure the failure within thirty (30) days and diligently and
continuously attempts to complete this cure as soon as reasonably possible. All
obligations of each party hereunder shall be construed as covenants, not
conditions.

16. LANDLORD OR TENANT MAY PERFORM THE OTHER’S OBLIGATIONS

16.1 If Tenant shall at any time fail to keep or perform any of its obligations
under this Lease in respect of (a) maintenance of insurance, (b) repairs and
maintenance of the Premises, (c) compliance with insurance requirements, or
(d) the making of any other payment or performance of any other obligation of
Tenant hereunder, Landlord may, but shall not be obligated to, upon the
continuance of such failure on Tenant’s part for ten business (10) days after
written notice (or, only in connection with a repair that must be made
immediately in the case of a bona fide emergency, only with reasonable advance
written notice, or if not feasible, oral notice) to Tenant (or after such
additional period, if any, as Tenant may reasonably require to cure such failure
if of a non-monetary nature which cannot be cured within said ten (10) business
day period, and if, within said ten (10) business day period, Tenant begins
appropriate action to cure such failure and thereafter prosecutes such action
with due diligence and continuity) and without waiving or releasing Tenant from
any obligation, make any such payment or perform any such obligation, and all
reasonable sums so paid by Landlord and all necessary incidental costs and
expenses incurred by Landlord in making such payments or performing such
obligation, together with interest thereon at the Default Rate from the date of
payment and shall be paid to Landlord on demand, or at Landlord’s option may be
added to any installment of Basic Rent thereafter falling due, and if not so
paid by Tenant, Landlord shall have the same rights and remedies as in the case
of a default by Tenant in the payment of Basic Rent.

 

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16.2 If Landlord shall at any time fail to keep or perform any of its
obligations under this Lease pursuant to Section 9.2, and Section 19.1 of this
Lease, Tenant may, but shall not be obligated to, perform any such obligation,
without waiving or releasing Landlord from such obligation, upon the continuance
of such failure on Landlord’s part for ten (10) business days after written
notice (or without notice and/or within a shorter time period in the case of a
bona fide emergency) to Landlord and Landlord’s mortgagees of which Tenant has
been provided notice (or after such additional period, if any, as Landlord may
reasonably require to cure such failure if of a nature which cannot be cured
within said ten (10) business day period, and if, within such ten (10) business
day period, Landlord begins appropriate action to cure such failure and
thereafter prosecutes such action with due diligence and continuity). Landlord
shall reimburse Tenant for all reasonable sums incurred by Tenant in performing
such obligation, together with interest thereon at the Default Rate from the
date of payment thereof, such reimbursement to be paid within thirty (30) days
of demand therefor. In the event that Landlord fails to reimburse Tenant as
aforesaid for costs incurred by Tenant in exercising its self-help remedies, and
provided that Tenant has obtained a judgment from a court of competent
jurisdiction that Tenant is entitled to such reimbursement and Landlord fails to
appeal in good faith or satisfy such judgment within thirty (30) days after
being notified thereof by Tenant, then, in such event, Tenant shall be entitled
to offset against Basic Rent and any additional charges thereafter due and
payable, until paid in full, the sums due to Tenant pursuant to said judgment.
In the event that the amounts due are not paid in full by the expiration or
earlier termination of the Term of this Lease, such deficiency shall be
immediately due and payable to Tenant.

16.3 The provisions of this Section 16 shall survive the expiration or earlier
termination of the Term.

17. SURRENDER OF PREMISES; HOLDOVER

17.1 Upon the expiration or earlier termination of this Lease (for any reason
whatsoever), Tenant shall surrender to Landlord the Premises in its “as is”
condition on the Effective Date, but broom clean and clear of debris caused by
Tenant, subject to the effects of ordinary wear and tear and depreciation
arising from lapse of time and damage without fault or liability of Tenant,
including without limitation damage by Casualty or loss by condemnation. Tenant
shall not have any repair, restoration, maintenance or removal obligation,
except as expressly provided in this Lease (including, without limitation,
Section 11). Tenant may at any time during the Term or renewal thereof remove
any trade fixture or any equipment which Tenant has installed in the Premises,
providing said Tenant repairs any damages caused by said removal.

17.2 Subject to Sections 7 and 11 above, title to all Tenant Property shall
remain in Tenant, and Tenant shall have the right to remove Tenant Property upon
or prior to the expiration or earlier termination of this Lease; provided that,
as provided in Section 11.1 of this Lease above, Landlord may require Tenant to
remove some or all such Tenant Property. Any items of such Tenant Property which
shall remain upon the Premises after the expiration or earlier termination by
Tenant of the Term may, at the option of Landlord, be deemed to have

 

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been abandoned, and in such case such items may be retained by Landlord as its
property or disposed of by Landlord, without accountability, in such manner as
Landlord shall determine. Tenant shall not have any right or obligation to
remove cables, wiring or the like that are affixed or otherwise attached to (or
embedded with any shafts, ducts or conduits within) any part of the Premises
that is located within or behind the surface of walls and floors or within or
above ceiling surfaces.

17.3 The parties recognize and agree that the damage to Landlord resulting from
any failure by Tenant timely to surrender possession of the Premises as
aforesaid will be substantial, will exceed the amount of the rent theretofore
payable hereunder, and will be impossible to accurately measure. Accordingly, if
Tenant shall fail to surrender the Premises upon the expiration or earlier
termination of this Lease, then, throughout the period commencing on such
expiration or earlier termination and continuing until Tenant shall have
surrendered the Premises (such period, the “Holdover Period”), Tenant shall be
deemed a holdover tenant and shall be liable to Landlord for a charge for each
day of the Holdover Period, in respect of use and occupancy and all damages
incurred by Landlord, equal to 175% of the rate of Basic Rent for the first
thirty (30) days during the Holdover Period, equal to 200% of the rate of Basic
Rent for the second thirty (30) days during the Holdover Period and equal to
225% of the rate of Basic Rent during the remaining Holdover Period (computed on
a per diem basis) payable under this Lease immediately prior to the commencement
of the Holdover Period. The foregoing charge be in addition to any Additional
Rent payable by Tenant for such holdover period and shall constitute liquidated
damages on account of Tenant’s holdover; and Landlord hereby waives any and all
right it may have to any further damages on account of Tenant’s holdover.
Nothing herein shall be deemed to grant Tenant any right to holdover, and in no
event shall the acceptance of any such charge preclude Landlord from commencing
and prosecuting any holdover or eviction proceeding (but Landlord shall not
claim, nor shall it be entitled to, any damages, as part of such proceeding,
beyond the aforementioned per diem charge, the Additional Rent payable during
such holdover period, and its costs of prosecuting such holdover or eviction
proceeding, including, without limitation, reasonable attorney’s fees and
disbursements directly relating thereto).

18. ASSIGNMENT AND SUBLETTING

18.1 Tenant shall not, voluntarily or by operation of law, (a) assign, mortgage,
pledge, encumber, sell or transfer this Lease, in whole or in part, or (b) make
any sublease, or permit occupancy of the Premises or any part thereof by anyone
other than Tenant, without the prior written consent of Landlord, which consent
shall not be unreasonably withheld, conditioned or delayed. No consent to any
assignment or sublease in a specific instance shall operate as a release of
Tenant from liability under this Lease. No consent to any assignment or sublease
in a specific instance shall operate as a waiver of the need for such consent in
any subsequent instance. Landlord’s consent to any proposed assignment or
sublease may be subject to the consistency, in Landlord’s reasonable judgment,
of the proposed assignee’s or subtenant’s business with other uses and tenants
in the Building. In the event that any assignee or subtenant pays to Tenant any
amount in excess of the Basic Rent then payable hereunder, or pro rata portion
thereof on a square footage basis for any portion of the Premises so assigned or
subleased, after deducting therefrom an amount equal to the reasonable expenses
incurred by

 

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Tenant in connection with such sublease or assignment (including but not limited
to brokerage fees, fit-up expenses, tenant improvements allowances, free rent
periods, marketing costs, advertising fees and attorney’s fees), which expenses
shall be amortized on a straight light basis over the remaining Term of the
Lease, then Tenant shall promptly pay fifty percent (50%) of said excess to
Landlord as and when received by Tenant.

18.2 Any provision of this Lease to the contrary notwithstanding, Tenant shall
have the right, at any time and from time to time and without notice (except as
expressly provided in Section 18.3, below) or consent, (a) to sublet all or part
of the Premises to any other Tenant Affiliate; or (b) assign this Lease to a
Successor; or (c) permit occupancy of the Premises by the personnel of any
entity that acquires a Tenant Affiliate or substantial portion of such Tenant
Affiliate’s assets for a reasonable transition period following such
acquisition. Any assignment or sublease under this Section 18.2 shall not
operate as a release of Tenant from liability under this Lease. For the purpose
of this Section 18.2, “control” shall mean the ownership of twenty percent
(20%) or more of the direct or indirect voting securities or beneficial
interests of an applicable entity. Further, notwithstanding anything in this
Lease to be contrary, Tenant shall also have the right to permit, at any time
and from time to time and without notice or consent, Affiliates and Successors
to occupy all or any portion of the Premises without any formal agreement
between Tenant and such entities.

18.3 In the event of the subletting or an assignment of this Lease to a Tenant
Affiliate or a Successor, Tenant shall notify Landlord, in writing, prior to
such subletting or assignment, as the case may be, and shall deliver to Landlord
copies of any sublease or assignment documentation executed by Tenant and Tenant
Affiliate.

18.4 No consent to any subletting or assignment shall release Tenant from or
otherwise affect Tenant’s continuing primary liability (which, following any
such assignment, shall be joint and several with the assignee).

19. INDEMNITY

19.1 Subject to Section 12.3, Tenant shall indemnify, defend and hold Landlord
and all Landlord Parties harmless from and against any loss, cost, damage,
claim, liability and expense (including, without limitation, reasonable
attorneys’ fees and disbursements) if, and to the extent, arising from any
negligent acts or omissions or willful misconduct of Tenant or any Tenant
Parties in, at or upon the Premises from and after the Commencement Date or any
accident, injury or damage caused by Tenant or any Tenant Parties in, at or upon
the Premises from and after the Commencement Date, or subject to Section 6.2 of
this Lease above, otherwise incurred in connection with or arising from any
cause in, on or about the Premises after the Commencement Date until Tenant
vacates the Premises, except to the extent resulting from the material breach of
this Lease by or the negligent acts or omissions or willful misconduct of
Landlord or any Landlord Party. The provisions of this Section 19 shall survive
the expiration or earlier termination of this Lease.

19.2 Without limiting the foregoing, Tenant hereby agrees to and does indemnify,
defend, and hold harmless, Landlord and all Landlord Parties from and against
any and all claims, demands, causes of action, fines, penalties, costs, expenses
(including attorneys

 

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fees and court costs), liens, or liabilities, if, and to the extent, caused by,
or arising out of Tenant’s failure to comply with its obligations under
Section 20. The provisions of this Section 19 shall survive the expiration or
earlier termination of this Lease.

20. ENVIRONMENTAL MATTERS. Subject to Section 6.2, Tenant shall not cause or
permit any Hazardous Materials to be brought upon or used in the Premises by
Tenant, its agents, employees, or contractors, or any other Tenant Parties, from
and after the Commencement Date, unless: (x) such Hazardous Materials are
necessary for the uses permitted under this Lease or are commonly used by
tenants using space for the uses permitted by this Lease (e.g., office supplies,
printer toner and limited quantities of cleaning supplies customarily used when
cleaning office space and substances and materials used in connection with or
contained within building systems, mechanical, electrical or other building
system components, generators and the like), and (y) Tenant manages such
Hazardous Materials strictly in accordance with all applicable Environmental
Laws. Landlord shall be solely responsible for and shall undertake all removal,
relocation, elimination, remediation or encapsulation of Hazardous Materials
required by any Governmental Authority, or as necessary to comply with, and not
violate, Legal Requirements, arising from Hazardous Materials that are present
on the Effective Date or introduced to, on, in, about, under or from the
Property by Landlord or any Landlord Party or any person or entity other than
Tenant or a Tenant Party. Tenant shall be solely responsible for and shall
undertake all removal, relocation, elimination, remediation or encapsulation of
Hazardous Materials required by any Governmental Authority, or as necessary to
comply with, and not violate, Legal Requirements, arising from Hazardous
Materials that are introduced in, under or from the Property by Tenant or any of
its agents, employees or contractors or any Tenant Parties from and after the
Commencement Date.

21. SUBORDINATION.

21.1 This Lease, at Landlord’s option, shall be subordinate to any present or
future Mortgage and to any and all advances made under any present or future
Mortgage and to all renewals, modifications, consolidations, replacements, and
extensions of any or all of same; provided, however, that Tenant’s quiet
possession will not be disturbed so long as no Event of Default has occurred.
Tenant agrees, with respect to any such Mortgage, that no documentation other
than this Lease shall be required to evidence such subordination. If any
Mortgagee shall elect for this Lease to be superior to the lien of its Mortgage
and shall give written notice thereof to Tenant, then this Lease shall
automatically be deemed prior to such Mortgage whether this Lease is dated
earlier or later than the date of said Mortgage or the date of recording
thereof. Tenant agrees to execute such documents as may be further required to
evidence such subordination (provided that such document includes the
Mortgagee’s agreement not to disturb Tenant’s quiet possession so long as an
Event of Default has not occurred) or to make this Lease prior to the lien of
any Mortgage, and by failing to do so within five (5) days after written demand,
Tenant shall have committed an Event of Default under the Lease. Notwithstanding
the provisions of this Section 21.1 above, it shall be a condition to the
subordination of this Lease to any Mortgage that hereafter encumbers the
Premises that Landlord shall have delivered to Tenant a Non-Disturbance
Agreement, executed and acknowledged by the holder of such Mortgage, as lender.

 

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21.2 If the holder of such Mortgage, as lender, requests modifications to the
Non-Disturbance Agreement at the time of execution and delivery of this Lease,
Tenant agrees that it shall not unreasonably withhold its consent to such
requested modifications.

22. BROKER. Landlord and Tenant each represents and warrants to the other that
they dealt with no broker in connection with the transaction contemplated by
this Lease. Landlord and Tenant will indemnify and hold the other harmless from
and against any and all claims, liabilities and expenses (including, without
limitation, reasonable attorneys’ fees and disbursements) for all brokerage
commissions or finder’s fees incurred by reason of the inaccuracy of the
representation and warranty contained in this Section.

23. NOTICES

23.1 Any notice, demand or other communication (each, a “notice”) that is given
or rendered pursuant to this Lease by either Landlord or Tenant to the other
party, shall be (i) given or rendered, in writing, (ii) addressed to the other
party at its required address(es) for notices delivered to it as set forth in
Section 23.2 below, and (iii) delivered via either (x) hand delivery,
(y) nationally recognized courier service (e.g., DHL, Federal Express, Express
Mail) or (z) certified U.S. mail postage prepaid with return receipt requested.
Any such notice shall be deemed given or rendered, and effective for purposes of
this Lease, as of the date actually delivered to the other party at such
address(es) (whether or not the same is then received by other party due to a
change of address of which no notice was given, or any rejection or refusal to
accept delivery). Notices from either party (to the other) may be given or
rendered by its counsel.

23.2 The required address of each party for notices delivered to it are as set
forth below. Each party, however, may, from time to time, designate an
additional or substitute required address(es) for notices delivered to it
(provided, that such designation must be made by notice given in accordance with
this Section 23).

 

If to Landlord:    PR III Middlefield Road, LLC    c/o Prudential Real Estate
Investors    8 Campus Drive, 4th Floor    Arbor Circle South    Parsippany, New
Jersey 07054    Attn: PRISA III Asset Management    Phone: (973) 734-1300 With a
copy to:    PR III Middlefield Road, LLC    Prudential Real Estate Investors   
Campus Drive, 4th Floor    Arbor Circle South    Parsippany, New Jersey 07054   
Attn: Law Department If to Tenant:    VeriSign Inc.    487 E. Middlefield Road

 

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   Mountain View, CA 94043    Attn: James L. Morgensen    Vice President,
Property Management Group With a copy to:    VeriSign, Inc.    487 East
Middlefield Road    Mountain View, California 94043    Attn: Office of the
General Counsel With a copy to:    DLA Piper US LLP 500 8th Street, NW   
Washington, DC 20004    Attention: Jeffrey R. Keitelman, Esq.

24. QUIET ENJOYMENT. Landlord hereby covenants and agrees that, unless and until
an Event of Default shall occur, Tenant shall, at all times during the Term,
have peaceable and quiet enjoyment and possession of the Premises without any
manner of hindrance from Landlord or any other person, firm or corporation.

25. ESTOPPEL CERTIFICATE. Within ten (10) days after a written notice from
Landlord, Tenant shall execute and deliver to Landlord a statement certifying
(a) that this Lease is in full force and effect, (b) that this Lease has not
been amended, or if so amended, specifying the date of each amendment, (c) the
date to which Basic Rent has been paid, (d) stating whether or not Tenant has
delivered to Landlord any notice that indicates that Landlord is in default in
performance of any of its obligations under this Lease, which notice remains
outstanding (and, if so, specifying each such notice and default), and
(e) stating whether or not Tenant has received from Landlord any notice that
alleges that Tenant is in default in performance of any of its obligations under
this Lease, which notice remains outstanding (and, if so, specifying each such
notice and alleged default). At Landlord’s request, the aforementioned
certification shall be to Landlord’s Mortgagee or other lender or Landlord’s
purchaser or investor, as well as Landlord. Tenant’s failure to deliver such
statement within ten (10) days after a second written notice requesting such
statement, which second notice is given by Landlord after expiration of the ten
(10) day period described above, shall conclusively be deemed to be an admission
by Tenant of the matters set forth in the request for an estoppel certificate.

26. LIMITATION OF LIABILITY. Tenant acknowledges and agrees, for itself and its
successors and assigns, that no trustee, director, officer, employee or agent of
Landlord shall be personally liable for any of the terms, covenants or
obligations of Landlord hereunder. Landlord acknowledges and agrees, for itself
and its successors and assigns, that no trustee, director, officer, employee or
agent of Tenant shall be personally liable for any of the terms, covenants or
obligations of Tenant hereunder.

27. ACCESS OF LANDLORD TO PREMISES

27.1 Subject to the provisions of this Section 27.1, Landlord (through its
authorized contractors, agents or representatives) may enter into and upon any
part of the Premises during reasonable hours and upon reasonable notice (which
shall mean (x) except cases

 

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of emergency, at least 24 hours prior notice to Tenant, and (y) in cases of
emergency, such prior notice, if any, or contemporaneous notice, as shall be
reasonable under the circumstances), for the following purposes: (i) to make
repairs to the Premises as Landlord is required, or expressly authorized, to
make pursuant to this Lease, or is required to make during the Term pursuant to
any applicable Legal Requirements or any Insurance Requirements; (ii) to
otherwise perform Landlord’s obligations under this Lease; (iii) for the purpose
of showing the same to existing or prospective purchasers or lenders; and
(iv) at any time during the last twelve (12) months of the Term (assuming no
further Extension Option is then available to Tenant), to show the Leased
Premises to prospective tenants.

27.2 With respect to any of the aforementioned authorized entries by Landlord
into and upon any part of the Premises, Tenant shall be entitled to have its
representative accompany Landlord.

27.3 Landlord shall not unreasonably interfere with the operation of Tenant’s
business during any of the aforementioned authorized entries. Without limiting
the generality of the foregoing, Landlord shall use commercially reasonable
efforts to make any routine repairs requiring access to the Premises after
Tenant’s normal business hours.

27.4 Notwithstanding any of the foregoing, unless otherwise expressly permitted
by Tenant in writing, Landlord shall not enter areas designated by Tenant as
high security areas, unless an emergency situation exists that requires such
entry to prevent imminent threat to human health, safety or material damage to
the Premises.

28. AUTHORITY

28.1 Landlord and Tenant each represents and warrants to the other party that it
has full right, power and authority to enter into and perform all of its
obligations under this Lease, without the consent or approval of any other
entity or person, and that it is making these representations knowing that the
other party will rely thereon.

28.2 Landlord and Tenant each further represents and warrants to the other that
the signatory of this Lease on its behalf has full right, power and authority to
act for and on behalf of it in entering into this Lease.

29. LANDLORD EXCULPATION. Tenant hereby acknowledges and agrees that,
notwithstanding anything herein to the contrary or any Legal Requirements to the
contrary, the liability of Landlord and the Landlord Parties hereunder and any
recourse by Tenant against Landlord or the Landlord Parties shall be limited
solely and exclusively to Landlord’s interest in and to the Property, and
neither Landlord nor any of the Landlord Parties shall have any personal
liability thereof, and Tenant hereby expressly waives and releases such personal
liability on behalf of itself and all persons claiming by, through or under
Tenant.

30. TRANSFER OF LANDLORD’S INTEREST. Tenant hereby acknowledges and agrees that
Landlord has the right to transfer all or any portion of its interest in the
Property and in this Lease and 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

 

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the performance of Landlord’s obligations hereunder after the date of such
transfer. The liability of any transferee shall be limited to the interest of
such transferee in the Property and such transferee shall be without personal
liability under this Lease, and Tenant hereby expressly waives and releases such
personal liability on behalf of itself and all persons claiming by, through or
under Tenant. Tenant further acknowledges and agrees that Landlord may assign
its interest in the Lease to a Mortgagee as additional security, and Landlord
agrees that such an assignment shall not release Landlord from its obligations
hereunder and that Tenant shall continue to look to Landlord for the performance
of its obligations hereunder.

31. ERISA

31.1 Tenant hereby represents, warrants and covenants that (a) Tenant is not
(and will not during the Term become) an employee pension benefit plan subject
to the provisions of Title IV of ERISA or subject to the minimum funding
standards under Part 3, Subtitle B, Title I of ERISA or Section 412 of the
Internal Revenue Code or Section 302 of ERISA, and none of its assets
constitutes or will constitute during the Term assets of any plan subject to
Part 4, Subtitle B, Title I of ERISA and/or Section 4975 of the Internal Revenue
Code, and (b) Tenant is not (and will not during the Term become) a
“governmental plan” within the meaning of Section 3(32) of ERISA and the funds
used by Tenant to pay rent and other amounts payable hereunder are not (and will
not be) subject to State statutes regulating investments of and fiduciary
obligations with respect to governmental plans.

31.2 Landlord hereby represents, warrants and covenants that (a) Landlord is not
(and will not during the Term become) an employee pension benefit plan subject
to the provisions of Title IV of ERISA or subject to the minimum funding
standards under Part 3, Subtitle B, Title I of ERISA or Section 412 of the
Internal Revenue Code or Section 302 of ERISA, and none of its assets
constitutes or will constitute during the Term assets of any plan subject to
Part 4, Subtitle B, Title I of ERISA and/or Section 4975 of the Internal Revenue
Code, and (b) Landlord is not (and will not during the Term become) a
“governmental plan” within the meaning of Section 3(32) of ERISA.

32. ANTI-TERRORISM REPRESENTATIONS. Tenant is not a person or entity with whom
Landlord is restricted from doing business under the Uniting and Strengthening
America by Providing Appropriate Tools Required to Intercept and Obstruct
Terrorism Act of 2001, H. R. 3162, Public Law 107-56 (commonly known as the “USA
Patriot Act”) and Executive Order Number 13224 on Terrorism Financing, effective
September 24, 2001 and regulations promulgated pursuant thereto (collectively,
“Anti-Terrorism Laws”), including without limitation persons and entities named
on the Office of Foreign Asset Control Specially Designated Nationals and
Blocked Persons List (collectively, “Prohibited Persons”).

33. WAIVER OF POST-JUDGMENT REMEDY, REDEMPTION, COUNTERCLAIM AND JURY TRIAL.
FOLLOWING AN EVENT OF DEFAULT BY TENANT, TENANT, FOR ITSELF AND FOR ALL PERSONS
CLAIMING THROUGH OR UNDER IT, HEREBY EXPRESSLY WAIVES ANY AND ALL RIGHTS WHICH
ARE, OR IN THE FUTURE MAY BE, CONFERRED UPON TENANT BY ANY PRESENT OR FUTURE LAW
TO REDEEM THE PREMISES, OR TO ANY NEW TRIAL IN ANY ACTION FOR EJECTION UNDER ANY
PROVISIONS OF LAW, AFTER REENTRY THEREUPON,

 

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OR UPON ANY PART THEREOF, BY LANDLORD, OR AFTER ANY WARRANT TO DISPOSSESS OR
JUDGMENT IN EJECTION. IF LANDLORD SHALL ACQUIRE POSSESSION OF THE PREMISES BY
SUMMARY PROCEEDINGS, OR IN ANY OTHER LAWFUL MANNER WITHOUT JUDICIAL PROCEEDINGS,
IT SHALL BE DEEMED A REENTRY WITHIN THE MEANING OF THAT WORD AS USED IN THIS
LEASE. IN THE EVENT THAT LANDLORD COMMENCES ANY SUMMARY PROCEEDINGS OR ACTION
FOR NONPAYMENT OF RENT OR OTHER CHARGES PROVIDED FOR IN THIS LEASE, TENANT SHALL
NOT INTERPOSE ANY COUNTERCLAIM (OTHER THAN A COMPULSORY COUNTERCLAIM) OF ANY
NATURE OR DESCRIPTION IN ANY SUCH PROCEEDING OR ACTION. EACH PARTY HEREBY WAIVES
ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION SEEKING SPECIFIC PERFORMANCE OF ANY
PROVISION OF THIS LEASE, FOR DAMAGES FOR ANY BREACH UNDER THIS LEASE, OR
OTHERWISE FOR ENFORCEMENT OF ANY RIGHT OR REMEDY HEREUNDER (EACH A “DISPUTE” AND
COLLECTIVELY, THE “DISPUTES”).

34. PROPOSITION 65 WARNING. Chemicals known to the State of California to cause
cancer and reproductive harm are present at the Property.

35. TERMINOLOGY. As used in this Lease, (i) the phrase “and/or” when applied to
one or more matters or things shall be construed to apply to any one or more or
all thereof as the circumstances warrant at the time in question, (ii) the terms
“herein” “hereof” and “hereunder”, and words of similar import, shall be
construed to refer to this Agreement as a whole, and not to any particular
Section, unless expressly so stated, (iii) the term “including”, whenever used
herein, shall mean “including without limitation”, except in those instances
where it is expressly provided otherwise, (iv) the term “person” shall mean a
natural person, a corporation, a limited liability company, and/or any other
form of business or legal association or entity, and (v) the term “business day”
shall mean any day other than a Saturday or Sunday or New Year’s Day, Memorial
Day, Independence Day, Labor Day, Thanksgiving Day, the day immediately
following Thanksgiving Day, and Christmas Day.

36. MISCELLANEOUS PROVISIONS

36.1 This Lease constitutes the entire agreement between the parties with
respect to the subject matter hereof. Any modification, amendment or waiver of
this Lease or any provision hereof must be in writing and executed by the party
against whom enforcement of such modification, amendment or waiver is sought.

36.2 The parties acknowledge that each has had an opportunity to review and
negotiate this Lease. This Lease shall be construed without regard to any
presumption or other rule requiring construction against the party causing this
Lease or any part hereof to be drafted.

36.3 The table of contents and the captions of this Lease are for convenience
and reference only, and in no way define, limit or describe the scope or intent
of this Lease or the intent of any provision hereof, and same shall not in any
way affect the provisions of this Lease.

36.4 If any provision of this Lease or the application thereof to any person or
circumstance shall be to any extent invalid or unenforceable, the remainder of
this Lease, or the

 

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application of such provision to persons or circumstances other than those as to
which it is invalid or unenforceable, shall not be affected thereby, and each
provision of this Lease shall be valid and enforceable to the fullest extent
permitted by law.

36.5 Tenant and Landlord are concurrently herewith recording a memorandum of
this Lease. Upon expiration or earlier termination of this Lease, Landlord and
Tenant each hereby agrees to execute, acknowledge and record, at Landlord’s sole
cost and expense, any documentation reasonably required by Landlord to release
the effect of such memorandum of this Lease.

36.6 This Lease shall be governed by, and construed and enforced in accordance
with, the laws of the State in which the Property is located.

36.7 The failure of either party to seek redress for the violation of, or to
insist upon the strict performance of any term, covenant or condition contained
in this Lease, shall not prevent a similar subsequent act from constituting a
default under this Lease.

36.8 All terms and words used in this Lease, regardless of the number or gender
in which they are used, shall be deemed to include any other number and any
other gender as the context may require.

36.9 This Lease shall become binding and effective only upon the execution and
delivery of this Lease by both Landlord and Tenant.

36.10 This Lease shall be binding upon and inure to the benefit of the parties
hereto and their respective successors and permitted assigns.

36.11 Tenant covenants by and for itself, its heirs, executors, administrators,
assigns, and all persons claiming under or through Tenant, and this Lease is
made and accepted upon and subject to the following conditions: that there shall
be no discrimination against or segregation of any person or group of persons,
on account of race, color, creed, sex, religion, marital status, ancestry or
national origin in the leasing, subleasing, transferring, use or enjoyment of
the Premises, nor shall Tenant itself, or any person claiming under or through
Tenant, establish or permit such practices of discrimination or segregation with
reference to the selection, location, number, use or occupancy, of tenants,
lessees, sublesees, subtenants or vendees in the Premises.

36.12 If either Landlord or Tenant should bring suit against the other with
respect to this Lease, including for unlawful detainer or any other relief
against the other hereunder, then all costs and expenses incurred by the
prevailing party therein (including, without limitation, its actual appraisers’,
accountants’, attorneys’ and other professional fees and court costs), shall be
paid by the other party. For purposes of this provision, the terms “attorneys’
fees” or “attorneys’ fees and costs,” or “costs and expenses” shall mean the
fees and expenses of external legal counsel of the parties hereto, which include
printing, photocopying, duplicating, mail, overnight mail, messenger, court
filing fees, costs of discovery, and fees billed for law clerks, paralegals,
investigators and other persons not admitted to the bar for performing services
under the supervision and direction of an attorney. In addition, the prevailing
party shall be

 

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entitled to recover reasonable attorneys’ fees and costs incurred in enforcing
any judgment arising from a suit or proceeding under this Lease, including
without limitation post-judgment motions, contempt proceedings, garnishment,
levy and debtor and third party examinations, discovery and bankruptcy
litigation, without regard to schedule or rule of court purporting to restrict
such award. This post-judgment award of attorneys’ fees and costs provision
shall be severable from any other provision of this Lease and shall survive any
judgment/award on such suit or arbitration and is not to be deemed merged into
the judgment/award or terminated with the Lease.

36.13 This Lease may be executed in one or more counterparts, each of which
shall be deemed an original, but all of which together shall constitute one and
the same instrument.

36.14 Nothing contained in this Lease shall be construed as creating any
relationship between Landlord and Tenant other than that of landlord and tenant.

[Remainder of page intentionally blank. Signatures appear on following page.]

 

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IN WITNESS WHEREOF, the parties hereto have caused this Lease to be executed as
a sealed instrument of the date first above written.

 

LANDLORD:

 

PR III MIDDLEFIELD ROAD, LLC

By:  

/s/ Timothy Hennessy

Name:   Timothy Hennessy Title:   Authorized Signatory

Federal Tax ID#:   26-0656580

TENANT:

 

VERISIGN, INC.

By:  

/s/ James L. Morgensen

Name:   James L. Morgensen Title:   Authorized Signatory

Federal Tax ID#:   94-3221585

 

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EXHIBIT A

DESCRIPTION OF THE LAND

LEGAL DESCRIPTION

Real property in the City of Mountain View, County of Santa Clara, State of
California, described as follows:

PARCEL 1, AS SHOWN ON THAT PARCEL MAP FILED FOR RECORD IN THE OFFICE OF THE
RECORDER OF THE COUNTY OF SANTA CLARA, STATE OF CALIFORNIA ON NOVEMBER 27, 1979,
IN BOOK 455 OF MAPS, PAGE(S) 3 AND 4.

EXCEPTING THEREFROM ALL THAT PORTION OF LAND GRANTED TO THE STATE OF CALIFORNIA
BY DEED FILED FOR RECORD IN THE OFFICE OF THE RECORDER OF THE COUNTY OF SANTA
CLARA ON MARCH 28, 1997 UNDER RECORDER’S SERIES NO. 13654075, OFFICIAL RECORDS
AND BEING MORE PARTICULARLY DESCRIBED AS FOLLOWS:

BEING A PORTION OF PARCEL NO. 1, AS SAID PARCEL IS SHOWN ON THAT CERTAIN MAP
RECORDED IN THE OFFICE OF THE COUNTY RECORDER OF SANTA CLARA COUNTY, ON NOVEMBER
27, 1979, IN BOOK 455 OF MAPS AT PAGES 3 AND 4, SITUATED IN THE CITY OF MOUNTAIN
VIEW, COUNTY OF SANTA CLARA, STATE OF CALIFORNIA, MORE PARTICULARLY DESCRIBED AS
FOLLOWS:

BEGINNING AT THE NORTHWEST CORNER OF PARCEL 3A DESCRIBED IN THAT FINAL ORDER OF
CONDEMNATION RECORDED JUNE 9, 1969 IN BOOK 8561, PAGE 506, OFFICIAL RECORDS OF
SANTA CLARA COUNTY, ON THE SOUTHWESTERLY LINE OF MIDDLEFIELD ROAD (100.00 FEET
WIDE MEASURED AT RIGHT ANGLES); THENCE ALONG SAID LINE, FROM A TANGENT WHICH
BEARS S. 27° 27’ 26” E., ALONG A CURVE TO THE RIGHT HAVING A RADIUS OF 180.00
FEET, THROUGH A CENTRAL ANGLE OF 10° 03’ 03”, AN ARC LENGTH OF 31.50 FEET TO A
POINT OF COMPOUND CURVATURE, ALONG A TANGENT CURVE TO THE RIGHT HAVING A RADIUS
OF 35.00 FEET, THROUGH A CENTRAL ANGLE OF 38° 22’ 34”, AN ARC LENGTH OF 23.44
FEET; THENCE N. 31° 06’ 28” W., 169.17 FEET; THENCE ALONG A TANGENT CURVE TO THE
LEFT HAVING A RADIUS OF 790.00 FEET, THROUGH A CENTRAL ANGLE OF 6° 00’ 08”, AN
ARC LENGTH OF 82.76 FEET TO A POINT ON SAID SOUTHWESTERLY LINE OF SAID
MIDDLEFIELD ROAD; THENCE ALONG LAST SAID LINE, S. 37° 13’ 39” E., 202.44 FEET TO
THE POINT OF BEGINNING.

ALSO EXCEPTING THEREFROM ALL THAT PORTION OF LAND GRANTED TO THE SANTA CLARA
COUNTY TRANSIT DISTRICT BY DEED FILED FOR RECORD IN THE OFFICE OF THE RECORDER
OF THE COUNTY OF SANTA CLARA ON JUNE 5, 1997 UNDER RECORDER’S SERIES NO.
13728708, OFFICIAL RECORDS AND BEING MORE PARTICULARLY DESCRIBED AS FOLLOWS:

ALL THAT CERTAIN REAL PROPERTY SITUATE IN THE CITY OF MOUNTAIN VIEW, COUNTY OF
SANTA CLARA, STATE OF CALIFORNIA, AND BEING A PORTION OF PARCEL 1 AS SHOWN ON
THAT CERTAIN MAP RECORDED IN BOOK 456 OF MAPS, AT PAGE 4, RECORDS OF SANTA CLARA
COUNTY AND BEING DESCRIBED AS FOLLOWS:

BEGINNING AT THE NORTHEASTERLY CORNER OF SAID PARCEL I, SAID POINT ALSO BEING ON
A NON-TANGENT CURVE TO THE RIGHT (CONCAVE TO THE SOUTHWEST) THE CENTER OF WHICH
BEARS S. 48° 33’ 00” W., 1,449.92 FEET;

THENCE ALONG THE NORTHEASTERLY LINE OF SAID PARCEL 1 AND ALONG THE ARC OF SAID
CURVE THROUGH A CENTRAL ANGLE OF 00° 04’ 50”, FOR AN ARC LENGTH OF 2.04 FEET TO
A POINT ON A NON TANGENT CURVE TO THE RIGHT (CONCAVE TO THE NORTHWEST THE CENTER
OF WHICH BEARS N. 63° 52’ 10’ W., 619.77 FEET;

 

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EXHIBIT A

DESCRIPTION OF THE LAND

(continued)

 

THENCE DEPARTING SAID NORTHEASTERLY LINE ALONG THE ARC OF SAID CURVE THROUGH A
CENTRAL ANGLE OF 18° 04’ 41”, FOR AN ARC LENGTH OF 195.55 FEET TO A POINT ON THE
NORTHWESTERLY LINE OF SAID PARCEL 1, SAID POINT ALSO BEING ON A NON-TANGENT
CURVE TO THE LEFT (CONCAVE TO THE NORTHWEST) THE CENTER OF WHICH BEARS, N. 45°
47’ 29” W., 598.11 FEET; THENCE ALONG SAID NORTHWESTERLY LINE AND ALONG THE ARC
OF SAID CURVE THROUGH A CENTRAL ANGLE OF 18° 47’ 08”, FOR AN ARC LENGTH OF
196.10 FEET TO THE POINT OF BEGINNING.

APN: 160-60-013

 

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EXHIBIT B

SUBORDINATION, NON-DISTURBANCE

AND ATTORNMENT AGREEMENT 

THIS AGREEMENT is made as of June 19, 2008, between [INSERT NAME OF PURCHASER’S
LENDER]. (“Lender”), having an office at [Insert Address of Purchaser’s Lender],
and VeriSign, Inc. (“Tenant”), having an address of 487 East Middlefield Road,
Mountain View, California 94043.

WITNESSETH:

WHEREAS, PR III Middlefield Road, LLC (“Landlord”) and Tenant have entered into
that certain lease dated June 19, 2008 (as amended, extended and renewed from
time to time, the “Lease”) covering certain premises (the “Premises”) including
the buildings located at 675 and 685 East Middlefield Road, Mountain View,
California (the “Building”); and

WHEREAS, Lender [has made] [intends to make] a loan (“Loan”) to Landlord, which
loan [is] [will be] secured by a mortgage or deed of trust (the “Mortgage”)
covering the Premises, the Building and the land on which the Building is
situated, such land being more particularly described in Exhibit A attached
hereto (the Premises, the Building and the land being collectively referred to
as the “Property”);

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties agree as follows:

1. The Lease is, and shall be, subject and subordinate to the Mortgage and to
all renewals, modifications, extensions and replacements thereof.

2. If the Mortgage is foreclosed, the mortgagee thereunder will not name or join
Tenant as a party defendant or otherwise in any suit, action or proceeding, and
will not terminate the Lease or any option to purchase the Property or any part
thereof contained therein or disturb Tenant’s occupancy of the Premises, so long
as Tenant is not in default under any of the terms, covenants or conditions of
the Lease beyond the expiration of any applicable grace period set forth
therein.

3. Any action by Lender to enforce the Mortgage by reason of a default
thereunder will not terminate the Lease or invalidate or constitute a breach of
any of the terms thereof, and in the event Lender forecloses the Mortgage, or
any party acquires the Property pursuant to a power of sale contained in the
Mortgage, or a deed in lieu of foreclosure is delivered (any or all of the above
being referred to as a “Foreclosure Sale”), Tenant will attorn to Lender or
other purchaser at any foreclosure sale thereunder or to the grantee under a
deed in lieu of foreclosure (the “Foreclosure Purchaser”), and will execute and
deliver such instruments as may be reasonably necessary to evidence such
attornment, provided Tenant receives from such purchaser or grantee an agreement
recognizing the validity of the Lease.

 

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4. In the event of a Foreclosure Sale, the Foreclosure Purchaser agrees to be
bound to Tenant under all of the terms, covenants and conditions of the Lease
from and after the date it acquires title to the Premises; provided, however,
the Foreclosure Purchaser shall not be:

 

  (a) liable for any act or omission of any prior landlord (including Landlord),
including any default on the part of the prior Landlord under the Lease, unless
any such act or omission or such default arises out of a continuing or present
responsibility of Landlord or constitutes a continuing default pursuant to the
terms of the Lease (e.g., an obligation on the part of Landlord to complete any
repair or replacement pursuant to the Lease); or

 

  (b) subject to any offsets or defenses that Tenant has against any prior
landlord (including Landlord); or

 

  (c) bound by the payment of any rent or additional rent that Tenant paid more
than one month in advance of the due date thereof to any prior landlord
(including Landlord) unless expressly provided for in the Lease; or

 

  (d) bound by any amendment or modification of the Lease made without Lender’s
consent, which consent Lender shall not unreasonably withhold or delay.

5. Tenant shall send a copy of any notice or statement alleging a Landlord
default under the Lease to Lender at the same time Tenant sends such notice or
statement to Landlord at the address set forth herein. The curing of any of
Landlord’s defaults by Lender shall be treated as performance by Landlord.

6. This Agreement shall be governed by and construed in accordance with the laws
of the State in which the Property is located. Neither this Agreement nor any
provision hereof shall be construed against the party causing this Agreement or
such provision to be drafted.

7. This Agreement shall not be amended, modified or terminated nor may any of
its provisions be waived, except by a writing signed by the party against whom
such amendment, modification, termination or waiver is sought to be enforced.

8. This Agreement shall run with the land and shall be binding upon and inure to
the benefit of the parties hereto and their respective successors and assigns,
including a Foreclosure Purchaser.

9. This Agreement shall not be effective unless and until it has been executed
and delivered by Tenant and Lender.

 

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IN WITNESS WHEREOF, the parties have executed this Agreement under seal as of
the date first above written.

 

LENDER: [INSERT NAME OF PURCHASER’S LENDER] By:  

 

Name:  

 

Its:  

 

TENANT: VERISIGN, INC. By:  

 

Name:  

 

Its:  

 

 

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STATE OF   

 

     )               )      ss.    COUNTY OF   

 

     )      

On                     , 2008 before me,                                     ,
Notary Public, personally appeared                                          
           , who proved to me on the basis of satisfactory evidence to be the
person(s) whose name(s) is/are subscribed to the within instrument and
acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s) on the
instrument the person(s), or the entity upon behalf of which the person(s)
acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California
that the foregoing is true and correct.

 

Witness my hand and official seal.      

 

       (Seal)    Signature of Notary Public      

 

STATE OF   

 

     )               )      ss.    COUNTY OF   

 

     )      

On                     , 2008 before me,                                     ,
Notary Public, personally appeared                                          
           , who proved to me on the basis of satisfactory evidence to be the
person(s) whose name(s) is/are subscribed to the within instrument and
acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s) on the
instrument the person(s), or the entity upon behalf of which the person(s)
acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California
that the foregoing is true and correct.

 

Witness my hand and official seal.      

 

       (Seal)    Signature of Notary Public      

 

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