exhibit_10-1.htm


    
      Exhibit
10.1

      STANDARD
MULTI-TENANT LEASE

       

      This
Standard Multi-Tenant Lease ("Lease") is
made and entered into as of the 19th day of
June, 2008, by and between ARDEN REALTY LIMITED PARTNERSHIP, a Maryland limited
partnership ("Landlord"),
and SCOLR PHARMA, INC., a Delaware corporation ("Tenant").

       

      Landlord
hereby leases to Tenant and Tenant hereby leases from Landlord the premises
described as a portion of the first floor, as designated on the plan attached
hereto and incorporated herein as Exhibit "A" ("Premises"), of
the project ("Project") now
known as Building One of North Creek Corporate Center whose address is
19204 North Creek Parkway, Bothell, Washington, and located upon the real
property ("Real
Property") described on Exhibit "A-1".  All existing leasehold
improvements within the Premises are included in the term "Premises." The Real
Property is a separate legal parcel and a separate tax parcel.  The
Real Property is known as North Creek Corporate Center, including the parking
area for North Creek Corporate Center, and is shown on the Site Plan attached
hereto as Exhibit "F" and made a part hereof (the "Development").  The
restrooms (other than any located within a tenant's rentable space), building
lobby and elevator within the Project are common areas for use by all tenants of
the Project and, during the term of this Lease, Tenant shall have the
non-exclusive right to the use and benefit of such common areas.  The
total rentable square footage of the Project is 49,115 square
feet.  The Development is a contiguous three-building development
known as North Creek Corporate Center owned by Landlord and the other two (2)
buildings in the Development are Building Two (having a total rentable
square footage of 18,212 square feet), whose address is 19310 North Creek
Parkway and Building Three (having a total rentable square footage of
27,356 square feet) whose address is 19102 North Creek Parkway.  The
Project and the other portions of the Development share connecting driveways,
walkways, parking areas and landscaped area (the "Development Common
Areas") and, subject to the terms and conditions of this Lease, all
tenants in the Development have, and during the term of this Lease, shall have
the non-exclusive right to use the Development Common Areas.  Landlord
recognizes that it has been informed by Tenant that Tenant is a specialty
pharmaceutical company that uses its proprietary technology platform to develop
novel pharmaceutical, over-the-counter and nutritional products and that
Tenant's use of the Premises may, subject to the terms and conditions of this
Lease, include production of prototype tablets in the Premises (such uses are
collectively referred to herein as the "Pharmaceutical
Development Uses").  This Lease shall be for the Term and upon
the terms and conditions hereinafter set forth, and Landlord and Tenant hereby
agree as follows:

       

      ARTICLE
1

       

      BASIC LEASE
PROVISIONS

       

      
        	
                A. 

              	
                Term:

              	
                Eighty-eight
      (88) months.

              
	 
      	
                Commencement
      Date:

              	
                The
      earlier of (i) the date Tenant first commences to conduct business in
      all of the Premises, or (ii) the later of (a) September 1, 2008,
      or (b) the date of Substantial Completion of Improvements in all of the
      Premises.  The Commencement Date is anticipated to be on or
      about September 1, 2008.

              
	 
      	
                Expiration
      Date:

              	
                The
      date immediately preceding the eighty-eighth (88th)
      monthly anniversary of the Commencement Date; provided, however, that if
      the Commencement Date is a date other than the first (1st)
      day of a month, the Expiration Date shall be the last day of the month
      which is eighty-eight (88) months after the month in which the
      Commencement Date falls, unless extended or earlier terminated pursuant to
      this Lease.

              


      

       

      
        
           

        

        
          1

          
            
 

        

        
           

        

      

       

      
        	
                B. 

              	
                Square
      Footage:

              	
                A
      total of 20,468 rentable square feet consisting of 9,360 rentable square
      feet of office space (the "Office
      Portion"), 8,939 rentable square feet of lab space (the "Lab
      Portion") and 2,169 rentable square feet of warehouse space (the
      "Warehouse
      Portion").

              
	
                C. 

              	
                Basic
      Rental:

              	 
      
	
                1.

              	
                Office
      Portion

              	 
      
	 
      	
                Months

              	
                Annual

                Basic
      Rental

              	
                Monthly

                Basic
      Rental

              	
                Monthly
      Basic Rental

                Per
      Square Foot

              
	
                 

                1-12

              	
                $149,385.60

              	
                $12,448.80*

              	
                $1.33

              
	
                13-24

              	
                $153,878.40

              	
                $12,823.20

              	
                $1.37

              
	 
      	
                25-36

              	
                $158,371.20

              	
                $13,197.60

              	
                $1.41

              
	 
      	
                37-48

              	
                $163,987.20

              	
                $13,665.60

              	
                $1.46

              
	 
      	
                49-60

              	
                $168,480.00

              	
                $14,040.00

              	
                $1.50

              
	 
      	
                61-72

              	
                $174,096.00

              	
                $14,508.00

              	
                $1.55

              
	 
      	
                73-84

              	
                $178,588.80

              	
                $14,882.40

              	
                $1.59

              
	 
      	
                85-88

              	
                $184,204.80

              	
                $15,350.40

              	
                $1.64

              
	 
      	
                *Subject
      to abatement as provided in Article 3 below.

              
	
                2.

              	
                Lab
      Portion

              	 
      	 
      	 
      
	 
      	
                Months

              	
                Annual

                Basic
      Rental

              	
                Monthly

                Basic
      Rental

              	
                Monthly
      Basic Rental

                Per
      Square Foot

              
	 
      	
                1-12

              	
                $210,245.28

              	
                $17,520.44*

              	
                $1.96

              
	 
      	
                13-24

              	
                $216,681.36

              	
                $18,056.78

              	
                $2.02

              
	 
      	
                25-36

              	
                $223,117.44

              	
                $18,593.12

              	
                $2.08

              
	 
      	
                37-48

              	
                $229,553.52

              	
                $19,129.46

              	
                $2.14

              
	 
      	
                49-60

              	
                $235,989.60

              	
                $19,665.80

              	
                $2.20

              
	 
      	
                61-72

              	
                $243498.36

              	
                $20,291.53

              	
                $2.27

              
	 
      	
                73-84

              	
                $251,007.12

              	
                $20,917.26

              	
                $2.34

              
	 
      	
                85-88

              	
                $258,515.88

              	
                $21,542.99

              	
                $2.41

              
	 
      	
                *Subject
      to abatement as provided in Article 3 below.

              
	
                3.

              	
                Warehouse
      Portion

              	 
      	 
      
	 
      	
                Lease
      Year

              	
                Annual

                Basic
      Rental

              	
                Monthly

                Basic
      Rental

              	
                Monthly
      Basic Rental

                Per
      Square Foot

              
	 
      	
                1-12

              	
                $16,918.20

              	
                $1,409.85*

              	
                $0.65

              
	 
      	
                13-24

              	
                $17,438.76

              	
                $1,453.23

              	
                $0.67

              
	 
      	
                25-36

              	
                $17,959.32

              	
                $1,496.61

              	
                $0.69

              
	 
      	
                37-48

              	
                $18,479.88

              	
                $1,539.99

              	
                $0.71

              
	 
      	
                49-60

              	
                $19,000.44

              	
                $1,583.37

              	
                $0.73

              
	 
      	
                61-72

              	
                $19,521.00

              	
                $1,626.75

              	
                $0.75

              
	 
      	
                73-84

              	
                $20,301.84

              	
                $1,691.82

              	
                $0.78

              
	 
      	
                85-88

              	
                $20,822.40

              	
                $1,735.20

              	
                $0.80

              
	 
      	
                *Subject
      to abatement as provided in Article 3
  below.

              


      

      
        
          	
                  4.

                	
                  Total
      Premises

                	 
      	 
      	 
      
	 
      	
                  Months

                	
                  Annual

                  Basic
      Rental

                	
                  Monthly

                  Basic
      Rental

                	 
      
	 
      	
                  1-12

                	
                  $376,549.08

                	
                  $31,379.09*

                	 
      
	 
      	
                  13-24

                	
                  $387,998.52

                	
                  $32,333.21

                	 
      
	 
      	
                  25-36

                	
                  $399,447.96

                	
                  $33,287.33

                	 
      
	 
      	
                  37-48

                	
                  $412,020.60

                	
                  $34,335.05

                	 
      


        

      

       

      
        
           

        

        
          2

          
            
 

        

        
           

        

      

       

      
        	 
      	
                Months

              	
                Annual

                Basic
      Rental

              	
                Monthly

                Basic
      Rental

              	 
      
	 
      	
                49-60

              	
                $423,470.04

              	
                $35,289.17

              	 
      
	 
      	
                61-72

              	
                $437,115.36

              	
                $36,426.28

              	 
      
	 
      	
                73-84

              	
                $449,897.76

              	
                $37,491.48

              	 
      
	 
      	
                85-88

              	
                $463,543.08

              	
                $38,628.59

              	 
      
	 
      	
                *Subject
      to abatement as provided in Article 3 below.

              
	
                D. 

              	
                Tenant's
      Proportionate Share (ratio of rentable area of the Premises to
      rentable area of the Project):

              	
                41.67%.

              
	
                E. 

              	
                Security
      Deposit/Letter of Credit:

              	
                A
      security deposit of $38,628.59 shall be due and payable by Tenant to
      Landlord upon Tenant's execution of this Lease.  In addition,
      concurrently with Tenant's execution of this Lease, Tenant shall provide
      Landlord with a Letter of Credit in the amount of $564,000.00 as further
      provided in Section 4(b) below.

              
	
                F. 

              	
                Permitted
      Use:

              	
                Pharmaceutical
      Development Uses and general office, lab, research, development,
      distribution and warehouse use and, to the extent reasonably approved by
      Landlord, any other legally permitted use for the
  Project.

              
	
                G. 

              	
                Brokers:

              	
                Flinn
      Ferguson (representing Tenant) and Pacific Real Estate Partners
      (representing Landlord).

              
	
                H. 

              	
                Parking
      Passes:

              	
                Tenant
      shall be entitled to use three point five (3.5) unreserved parking passes
      for each 1,000 rentable square feet contained in the Premises, which
      equals seventy-two (72) passes.  Each such parking pass shall
      entitle Tenant to an unreserved parking space in the parking facility
      located in the Development on a first come-first served
    basis.

              
	
                I. 

              	
                Initial
      Installment of Basic Rental:

              	
                The
      first full month's Basic Rental of $31,379.09 shall be due and payable by
      Tenant to Landlord upon Tenant's execution of this
  Lease.

              


      

       

      ARTICLE
2

       

      TERM/PREMISES

       

      (a) Term.  The
Term of this Lease shall commence on the Commencement Date as set forth in
Article 1.A. of the Basic Lease Provisions and shall end on the Expiration
Date set forth in Article 1.A. of the Basic Lease
Provisions.  For purposes of this Lease, the term "Lease Year"
shall mean each consecutive twelve (12) month period during the Lease Term, with
the first (1st) Lease
Year commencing on the Commencement Date; however, (a) if the Commencement
Date falls on a day other than the first (1st) day of
a calendar month, the first (1st) Lease
Year shall end on the last day of the eleventh (11th) month
after the Commencement Date and the second (2nd) and
each succeeding Lease Year shall commence on the first (1st) day of
the next calendar month, and (b) the last Lease Year shall end on the
Expiration Date.  If Landlord does not deliver possession of the
Premises to Tenant on or before the anticipated Commencement Date (as set forth
in Article 1.A above), Landlord shall not be subject to any liability for its
failure to do so, and such failure shall not affect the validity of this Lease
nor the obligations of Tenant hereunder; provided, however, if during
construction of the Improvements in the Premises, Landlord and Tenant reasonably
determine that Substantial Completion of the Improvements in all of the Premises
will not occur on or before October 31, 2008, and Landlord



         

        
          
             

          

          
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will promptly instruct Contractor
to focus its efforts in such manner so that Tenant may occupy at least such
portions of the Premises prior to October 31, 2008.  Landlord and
Tenant agree to reasonably work together, in good faith, to identify portions of
the Premises within which the Contractor may focus its efforts in order to cause
such portions to be in a condition which may be legally occupied by Tenant prior
to October 1.  If Tenant so occupies any portion of the Premises
prior to the Commencement Date, all of the terms and conditions of this Lease
apply during the period of such occupancy and prior to the Commencement Date
including, without limitation, Tenant's obligation to maintain insurance
pursuant Article 14 below; however, (i) Tenant's obligation to pay monthly
Basic Rental and any Direct Costs shall be prorated during such period based
upon the number of rentable square feet so occupied by Tenant (and as to Basic
Rental at the initial rate specified in Section 1(C) above), which payments
shall be due within thirty (30) days after invoice, and (ii) the Commencement
Date for this Lease shall not occur until the date specified in the definition
of Commencement Date in Section 1(A) above occurs.  Tenant's
entry onto the Premises pursuant to Section 6.4 of the Tenant Work Letter
to conduct its fixturization shall not constitute Tenant's conducting business
in the Premises for purposes of the definition of Commencement
Date.

      

      (b) Premises.  Landlord
and Tenant hereby stipulate that the Premises contains the number of square feet
specified in Article 1.B. of the Basic Lease
Provisions.  Landlord may deliver to Tenant a Commencement Letter in a
form substantially similar to that attached hereto as Exhibit "C", which, if the
completed information therein is accurate, Tenant shall execute and return to
Landlord within five (5) days of receipt thereof.  Failure of Tenant
to execute and deliver the Commencement Letter or object in writing to any
inaccuracy therein within such period shall constitute an acknowledgment by
Tenant that the statements included in such notice are true and correct, without
exception.

       

      ARTICLE
3

       

      RENTAL

       

      (a) Basic
Rental.  Tenant agrees to pay to Landlord during the Term
hereof, at Landlord's office or to such other person or at such other place as
directed from time to time by written notice to Tenant from Landlord, the
initial monthly sums as set forth in Article 1.C. of the Basic Lease
Provisions, payable in advance on the first (1st) day of
each calendar month, without demand, setoff or deduction, except as expressly
provided in this Lease, and in the event this Lease commences or the date of
expiration of this Lease occurs other than on the first day or last day of a
calendar month, the rent for such month shall be
prorated.  Notwithstanding anything to the contrary contained herein,
Landlord hereby agrees to abate Tenant's obligation to pay monthly Basic Rental
for the second (2nd)
through and including the fifth (5th) months
of the initial Lease Term.  During such abatement period, Tenant shall
still be responsible for the payment of all of its other monetary obligations
under the Lease.  If an Event of Default occurs that results in early
termination of this Lease pursuant to the provisions of Section 20(a) of
this Lease, then as a part of the recovery set forth in Section 20 of this
Lease, Landlord shall be entitled to the recovery of the unamortized portion of
the monthly Basic Rental that was abated under the provisions of this
Article 3.  In addition, notwithstanding the foregoing, the first
(1st) full
month's Basic Rental shall be paid to Landlord in accordance with
Article 1.I. of the Basic Lease Provisions and, if the Commencement Date is
not the first day of a month, Basic Rental and Rental Tax for the partial month
commencing as of the Commencement Date shall be prorated based upon the actual
number of days in such month and shall be due and payable upon the Commencement
Date.

       

      (b) Direct
Costs.  Tenant shall pay an additional sum for each calendar
year during the Term equal to the product of the Tenant's Proportionate Share
set forth in Article 1.D. of the Basic Lease Provisions multiplied by the
amount of Direct Costs.  In the event either the Premises and/or the
Project is expanded or reduced, then Tenant's Proportionate Share shall be
appropriately adjusted based on the ratio of the rentable area of the Premises
to the rentable area of the Project, and as to the calendar year in which such
change occurs, Tenant's Proportionate Share for such calendar year shall be
determined on the basis of the number of days during that particular calendar
year that such Tenant's Proportionate Share was in effect.  In the
event this Lease shall terminate on any date other than the last day of a
calendar year, the additional sum payable hereunder by Tenant during the
calendar year in which this Lease terminates shall be prorated on the basis of
the relationship which the number of days which have elapsed from the




        
          
             

          

          
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commencement of said
calendar year to and including said date on which this Lease terminates bears to
three hundred sixty-five (365).  Any and all amounts due and payable
by Tenant pursuant to this Lease (other than Basic Rental) shall be deemed
"Additional
Rent" and Landlord shall be entitled to exercise the same rights and
remedies upon default in these payments as Landlord is entitled to exercise with
respect to defaults in monthly Basic Rental payments.  Basic Rental
and Additional Rent may be collectively referred to herein as "Rent".  At
the same time as any payment of Rent is to be made by Tenant hereunder, Tenant
shall also pay any and all rental taxes, gross receipts taxes, transaction
privilege taxes, sales taxes, and/or similar taxes levied currently or in the
future on the Rent amount then due or otherwise assessed in connection with the
rental activity then occurring (collectively, "Rental
Tax").(c) Definitions.  As
used herein the term "Direct Costs"
shall mean the sum of the following:

        

      

       

      (i) "Tax Costs",
which shall mean any and all real estate taxes and other similar charges on real
property or improvements, assessments, water and sewer charges, and all other
charges assessed, reassessed or levied upon the Project and appurtenances
thereto and the parking or other facilities thereof, or the Real Property during
the Term which are assessed, reassessed or levied by the United States, the
State of Washington, any applicable county within the State of Washington, any
applicable city, town or other local government authority within the State of
Washington, and/or any other agency or political subdivision of the State of
Washington, and shall include Landlord's reasonable legal fees, costs and
disbursements incurred in connection with proceedings for reduction of Tax Costs
or any part thereof; provided, however, if at any time after the date of this
Lease the methods of taxation now prevailing shall be altered so that in lieu of
or as a supplement to or a substitute for the whole or any part of any Tax
Costs, there shall be assessed, reassessed or levied (a) a tax, assessment,
reassessment, levy, imposition or charge wholly or partially as a net income,
capital or franchise levy or otherwise on the rents, issues, profits or income
derived therefrom, or (b) a tax, assessment, reassessment, levy (including but
not limited to any municipal, state or federal levy), imposition or charge
measured by or based in whole or in part upon the Real Property and imposed upon
Landlord, then except to the extent such items are payable by Tenant under
Article 6 below, such taxes, assessments, reassessments or levies or the
part thereof so measured or based, shall be deemed to be included in the term
"Direct Costs."  Notwithstanding the foregoing, Tax Costs shall not
include any income, business and occupancy, capital levy, franchise, capital
stock, gift, transfer, real estate excise estate or inheritance tax, or any
interest, penalties or damages incurred for late payment of taxes or
assessments.  If a tax or assessment is payable in installments, Tax
Costs applicable thereto for a year shall include only the amount of the
installment and any interest due and payable during that
year.

       

      (ii) "Operating
Costs", which shall mean all costs and expenses incurred by Landlord in
connection with the maintenance, operation, management and repair of the
Project, the equipment, the intra-building cabling and wiring, adjacent walks,
driveways and landscaped and common areas and the parking lot, areas and
facilities of the Project.   Operating Costs shall include but
not be limited to, salaries, wages, medical, surgical and general welfare
benefits and pension payments, payroll taxes, fringe benefits, employment taxes,
workers' compensation, uniforms and dry cleaning thereof for all employees at or
below the portfolio manager level who perform duties connected with the
operation, maintenance and repair of the Project, its equipment, the
intra-building cabling and wiring and the adjacent walks and landscaped areas,
including gardening, security, parking, operating engineer, elevator, painting,
plumbing, electrical, carpentry and window washing, (provided, however that to
the extent personnel perform services for buildings other than the Project, the
labor costs associated with such personnel shall be included in Operating Costs
only to the extent and in the proportion that such personnel perform services
for the Project); a reasonable allowance for depreciation of the cost of
acquiring or the rental expense of personal property used in the maintenance,
operation and repair of the Project, accountant's fees incurred in the
preparation of rent adjustment statements and real estate tax consulting fees
pertaining to the Project; personal property taxes on property used in the
maintenance and operation of the Project; fees, costs, expenses or owners'
association dues payable pursuant to the terms of any recorded covenants,
conditions or restrictions pertaining to the Project; the amortized cost of
capital improvements made to the Project which are performed primarily to
reduce Operating Costs or otherwise improve the operating efficiency of the
Project amortized on a straight line basis over the useful life of such
improvements (but not to exceed the projected annual reduction in Operating
Costs) and the amortized cost of capital improvements to the Project required to
comply with any applicable Laws that are 


         

        
          
             

          

          
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enacted after the
Commencement Date ("New Laws");
non-capital maintenance costs incurred on a regular recurring basis every three
(3) or more years for certain maintenance projects on the Project (e.g., parking
lot slurry coat and roof patching, but not repaving of the parking lot or roof
replacement); the cost of all charges for utilities furnished to the common
areas of the Project and utilities that are not separately payable by tenants of
the Project, including any taxes thereon; the cost of all charges for fire and
extended coverage, liability and all other insurance in connection with the
Project carried by Landlord; the cost of all supplies and materials used in the
maintenance and operation of the Project; the cost of all charges for cleaning,
maintenance and service contracts and other services with independent
contractors and administration fees; a property management fee (which fee may be
imputed if Landlord has internalized management or otherwise acts as its own
property manager) and license, permit and inspection fees relating to the
Project.

        

      

       

      Notwithstanding
anything above to the contrary, Operating Costs shall not include (1) the
cost of providing any service directly to and paid directly by any tenant
(outside of such tenant's Direct Cost payments) such as where a Tenant directly
contracts for electric power or other utilities with the local public services
company, provided that in each such case, Landlord shall have the right to
"gross up" such item as if such space was vacant; (2) the cost of any items
for which Landlord is reimbursed by insurance proceeds (or would have been
reimbursed if Landlord maintained the insurance required to be maintained by
Landlord under this Lease), condemnation awards, a tenant of the Development
(outside of such tenant's Direct Cost payments), or otherwise to the extent so
reimbursed; (3) any real estate brokerage commissions or other costs
incurred in procuring tenants, or any fee in lieu of commission;
(4) amortization of principal and interest on mortgages or ground lease
payments (if any); (5) costs of items considered capital repairs,
replacements, improvements and equipment under generally accepted accounting
principles consistently applied except as expressly included in Operating Costs
pursuant to the definition above; (6) costs incurred by Landlord due to the
violation by Landlord or any tenant of the terms and conditions of any lease of
space in the Development or any law, code, regulation, ordinance or the like;
(7) any compensation paid to clerks, attendants or other persons in
commercial concessions operated by Landlord (other than in the parking facility
for the Development); (8) costs incurred in connection with upgrading the
Project or Development to comply with disability, life, seismic, fire and safety
codes, ordinances, statutes, or other laws in effect prior to the Commencement
Date, including, without limitation, the then applicable requirements of the
Americans with Disabilities Act ("ADA"),
including penalties or damages incurred due to such non-compliance; (9) bad
debt expenses and interest, principal, points and fees on debts (except in
connection with the financing of items which may be included in Operating
Costs); (10) marketing costs, including those costs described in (3)
above, attorneys' fees in connection with the negotiation and preparation of
letters, deal memos, letters of intent, leases, subleases, assignments,
agreements relating to financing or sale of the Project or Development, space
planning costs, and other costs and expenses incurred in connection with lease,
sublease and/or assignment negotiations and transactions with present or
prospective tenants or other occupants of the Development, including attorneys'
fees and other costs and expenditures incurred in connection with disputes with
present or prospective tenants or other occupants of the Development, or in
connection with any financing or sale transactions pertaining to the Project or
Development; (11) costs, including permit, license and inspection costs,
incurred with respect to the installation of other tenants' or occupants'
improvements made for tenants or other occupants in the Project or incurred in
renovating or otherwise improving, decorating, painting or redecorating vacant
space for tenants or other occupants in the Project; (12) any costs
expressly excluded from Operating Costs elsewhere in this Lease; (13) costs
of any items (including, but not limited to, costs incurred by Landlord for the
repair of damage to the Project or Development) to the extent Landlord receives
reimbursement from insurance proceeds or from a third party (except that any
commercially reasonable deductible amount under any insurance policy shall be
included within Operating Costs); (14) rentals and other related expenses
for leasing an HVAC system, elevators, or other items (except when needed in
connection with normal repairs and maintenance of the Project) which if
purchased, rather than rented, would constitute a capital improvement not
included in Operating Costs pursuant to this Lease; (15) depreciation,
amortization and interest payments, except as specifically included in Operating
Costs pursuant to the terms of this Lease and except on materials, tools,
supplies and vendor-type equipment purchased by Landlord to enable Landlord to
supply services Landlord might otherwise contract for with a third party, where
such depreciation, amortization and interest payments would otherwise have been
included in the charge for such third party's services, all as determined in
accordance with generally accepted accounting principles, 


         

        
          
             

          

          
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consistently
applied, and when depreciation or amortization is permitted or required, the
item shall be amortized over its reasonably anticipated useful life;
(16) expenses in connection with services or other benefits which are not
offered to Tenant or for which Tenant is charged for directly but which are
provided to another tenant or occupant of the Development, without charge;
(17) costs incurred in connection with the operation of retail stores
selling merchandise, specialty service facilities and restaurants in the Project
or Development to the extent such costs are in excess of the costs Landlord
reasonably estimates would have been incurred had such space been used for
general office use; (18) costs (including in connection therewith all
attorneys' fees and costs of settlement, judgments and/or payments in lieu
thereof) arising from claims, disputes or potential disputes in connection with
potential or actual claims litigation or arbitrations pertaining to Landlord
and/or the Project or Development, other than such claims or disputes respecting
any services or equipment used in the operation of the Project or Development by
Landlord; (19) costs associated with the operation of the business of the
partnership which constitutes Landlord as the same are distinguished from the
costs of operation of the Project or Development; (20) costs incurred in
connection with the original construction of the Project or Development;
(21) costs of correcting defects in or inadequacy of the initial design or
construction of the Project or Development; (22) costs incurred to
(i) remove, remediate, contain treat or comply with laws relating to the
removal of any "Hazardous Material," as that term is defined in Article 28
of this Lease, which was in existence on the Project or Development prior to the
Commencement Date, and (ii) remove, remediate, contain or treat or comply
with Laws relating to the removal of any Hazardous Material, which Hazardous
Material is brought onto the Project or Development after the date hereof by
Landlord or any other tenant of the Project or Development or other third party
(provided, however, the cost of removal of de minimis amounts of Hazardous
Material customarily found in office developments (such as cleaners, solvents,
lubricants, parking lot runoff, etc.) as part of the general operation of the
Development may be included in Operating Costs); (23) property management
fees and other service fees to the extent they exceed the amount which would
generally be expected to be the cost of such services rendered by comparably
qualified, unaffiliated third parties; and (24) damages or penalties
arising from Landlord's breach of any agreement or contract.

      It is
understood that Operating Costs shall be reduced by all cash discounts,
rebates,. trade discounts, or quantity discounts received by Landlord or
Landlord's managing agent in the purchase of any goods, utilities, or services
in connection with the operation of the Project.  Landlord shall make
payments for goods, utilities and services in a timely
manner.  Landlord agrees to keep records of Operating Costs in
accordance with a system of accounts and accounting practices consistently
maintained on a year-to-year basis.

       

      It is
understood that to the extent applicable all Operating Costs shall be calculated
by Landlord in accordance with generally accepted accounting principles or
otherwise in accordance with standard real estate accounting practices utilized
by institutional quality landlords in the State of Washington and reduced by all
cash discounts, trade discounts, or quantity discounts actually received by
Landlord or Landlord's managing agent in the purchase of any goods, utilities,
or services in connection with the operation of the Project.

       

      In the
event, during any calendar year, the Project is less than ninety-five percent
(95%) occupied at all times, those components of Operating Costs that are
variable with occupancy shall be adjusted and determined for such calendar year
as if the Project was ninety-five percent (95%) occupied at all times, and the
increase or decrease in the sums owed hereunder shall be based upon such
Operating Costs as so adjusted.

       

      (d) Determination
of Payment.

       

      (i) Landlord
shall give Tenant a yearly expense estimate statement (the "Estimate
Statement") which shall set forth Landlord's reasonable estimate (the
"Estimate") of
what the total amount of Direct Costs for the then-current calendar year shall
be (the "Estimated Direct
Costs"), together
with the amount payable by Tenant for Tenant's Proportionate Share of such
Estimated Direct Costs.  The failure of Landlord to timely furnish the
Estimate Statement for any calendar year shall not preclude Landlord from
subsequently enforcing its rights to collect any Estimated Direct Costs under
this Article 3, once such Estimated Direct Costs have been determined by
Landlord.  Tenant shall pay, with its next installment of Monthly
Basic Rental which is due at least twenty (20) days from the date Tenant
receives the Estimate Statement, a fraction of the Tenant's Proportionate Share
of such Estimated Direct Costs for the then-current calendar year (reduced by
any amounts paid pursuant to the last sentence of this 

       

      
        
           

        

        
          7

          
            
 

        

        
           

        

      

      
Section 3(d)(i)).  Such fraction shall
have as its numerator the number of months which have elapsed in such current
calendar year to the month of such payment, both months inclusive, and shall
have twelve (12) as its denominator.  Until a new Estimate Statement
is furnished, Tenant shall pay monthly, with the monthly Basic Rental
installments, an amount equal to one-twelfth (1/12) of the total of Tenant's
Proportionate Share of such Estimated Direct Costs Estimated Direct Costs set
forth in the previous Estimate Statement delivered by Landlord to Tenant.(ii) In
addition, Landlord shall endeavor to give to Tenant as soon as reasonably
practicable following the end of each calendar year (but not later than one
hundred eighty (180) days after the end of such year), a statement (the "Statement")
which shall state the Direct Costs incurred or accrued for such preceding
calendar year.  Upon receipt of the Statement for each calendar year
during the Term, if amounts paid by Tenant as Estimated Direct Costs are less
than Tenant's actual Proportionate Share of Direct Costs as specified on the
Statement, Tenant shall pay, with its next installment of monthly Basic Rental
which is due at least twenty (20) days from the date Tenant receives the
Estimate Statement, the full amount of Tenant's actual Proportionate Share of
Direct Costs for such calendar year, less the amounts, if any, paid during such
calendar year as Estimated Direct Costs.  If, however, the Statement
indicates that amounts paid by Tenant as Estimated Direct Costs are greater than
Tenant's actual Proportionate Share of Direct Costs as specified on the
Statement, such overpayment shall be credited against Tenant's next installments
of Rent.  The failure of Landlord to timely furnish the Statement for
any calendar year shall not prejudice Landlord or Tenant from enforcing its
rights under this Article 3, once such Statement has been
delivered.  Even though the Term has expired and Tenant has vacated
the Premises, when the final determination is made of Tenant's Proportionate
Share of the Direct Costs for the calendar year in which this Lease terminates,
Tenant shall immediately pay to Landlord (or Landlord shall reimburse to Tenant)
an amount as calculated pursuant to the provisions of this
Section 3(d).  The provisions of this Section 3(d)(ii) shall
survive the expiration or earlier termination of the Term.

       

      (iii) If the
Project is a part of a multi-building development, those Direct Costs
attributable to such development as a whole (and not attributable solely to any
individual building therein) shall be allocated by Landlord to the Project and
to the other buildings within such development on an equitable and commercially
reasonable basis.

       

      (e) Audit
Right.  Within one hundred eighty (180) days after receipt of a
Statement by Tenant ("Review
Period"), if Tenant disputes the amount set forth in the Statement,
Tenant's employees or an independent certified public accountant (which
accountant is a member of a nationally or regionally recognized accounting firm
and is not retained on a contingency fee basis), designated by Tenant, may,
after reasonable notice to Landlord ("Review
Notice") and at reasonable times, inspect Landlord's records at
Landlord's offices in the Seattle metropolitan area, provided that Tenant is not
then in default after expiration of all applicable cure periods and provided
further that Tenant and such accountant or representative shall, and each of
them shall use their commercially reasonable efforts to cause their respective
agents and employees to, maintain all information contained in Landlord's
records in confidence, provided such information may be disclosed to Tenant’s
lawyers, advisors, lenders and others who have a legitimate need to know such
information.  Notwithstanding the foregoing, Tenant shall only have
the right to review Landlord's records one (1) time (which review may occur over
a period of more than one day, as reasonably required) during any twelve (12)
month period.  If after such inspection, but within sixty (60) days
after the Review Period, Tenant notifies Landlord in writing ("Dispute
Notice") that Tenant still disputes such amounts, a certification as to
the proper amount shall be made in accordance with Landlord's standard
accounting practices, at Tenant's expense, by a neutral, independent certified
public accountant selected by Landlord and who is a member of a nationally or
regionally recognized accounting firm which has no affiliation or contractual
relationship with Landlord or Tenant.  Landlord shall engage such
independent accountant within thirty (30) days after Landlord receives the
Dispute Notice.  Tenant's failure to deliver the Review Notice within
the Review Period or to deliver the Dispute Notice within sixty (60) days after
the Review Period shall be deemed to constitute Tenant's approval of such
Statement and Tenant, thereafter, waives the right or ability to dispute the
amounts set forth in such Statement.  If Tenant timely delivers the
Review Notice and the Dispute Notice, Landlord shall cooperate in good faith
with Tenant and the independent accountant to show Tenant and such accountant
the information upon which the certification is to be based.  However,
if such certification by the independent accountant proves that the Direct Costs
set forth in the Statement were overstated by more than four percent (4%), then
the cost of the independent accountant and the cost of such certification shall
be paid for by Landlord.  

       

      
        
           

        

        
          8

          
            
 

        

        
           

        

      

      
Promptly following the parties
receipt of such certification, the parties shall make such appropriate payments
or reimbursements, as the case may be, to each other, as are determined to be
owing pursuant to such certification.  Tenant agrees that this section
shall be the sole method to be used by Tenant to dispute the amount of any
Direct Costs payable by Tenant pursuant to the terms of this Lease, and Tenant
hereby waives any other rights at law or in equity relating
thereto.

       

      ARTICLE
4

       

      SECURITY
DEPOSIT/LETTER OF CREDIT

       

      (a) Security
Deposit.  Tenant has deposited or concurrently herewith is
depositing with Landlord the sum set forth in Article 1.E. of the Basic
Lease Provisions as security for the full and faithful performance of every
provision of this Lease to be performed by Tenant.  If an Event of
Default occurs and is continuing, Landlord may use all or any part of this
security deposit for the payment of any rent or any other sums in default, or to
compensate Landlord for any expense actually and reasonably incurred by Landlord
as a result of Tenant's default or if Landlord has terminated the Lease, the
damages to which Landlord is entitled pursuant to Article 20 of this
Lease.  If any portion of said deposit is so used or applied, Tenant
shall, within five (5) business days after written demand therefor, deposit cash
with Landlord in an amount sufficient to restore the security deposit to its
full amount.  Tenant agrees that Landlord shall not be required to
keep the security deposit in trust, segregate it or keep it separate from
Landlord's general funds but Landlord may commingle the security deposit with
its general funds and Tenant shall not be entitled to interest on such
deposit.  At the expiration of the Term, and except to the extent
Tenant owes Landlord money due to a default by Tenant hereunder, the security
deposit or any balance thereof shall be returned to Tenant (or, at Landlord's
option, to Tenant's "Transferee", as such term is defined in Article 15
below), provided that subsequent to the expiration of this Lease, Landlord may
retain from said security deposit (i) an amount reasonably estimated by Landlord
to cover potential Direct Cost reconciliation payments due with respect to the
calendar year in which this Lease terminates or expires (such amount so retained
shall not, in any event, exceed ten percent (10%) of Estimated Direct Cost
payments due from Tenant for such calendar year through the date of expiration
or earlier termination of this Lease and any amounts so retained and not applied
to such reconciliation shall be returned to Tenant within thirty (30) days after
Landlord's delivery of the Statement for such calendar year), (ii) any and all
amounts reasonably estimated by Landlord to cover the anticipated costs to be
incurred by Landlord to remove any signage provided to Tenant under this Lease,
to remove cabling and other items required to be removed by Tenant under Section
29(b) below and to repair any damage caused by such removal (in which case any
excess amount so retained by Landlord shall be returned to Tenant within thirty
(30) days after such removal and repair), and (iii) any and all amounts
permitted by law and this Article 4. Tenant hereby waives any provisions of law,
now or hereafter in effect, which provide that Landlord may claim from a
security deposit only those sums reasonably necessary to remedy defaults in the
payment of rent, to repair damage caused by Tenant or to clean the Premises, it
being agreed that Landlord may, in addition, claim those sums specified in this
Article 4 above, and all of Landlord's damages under this Lease and Washington
law including, but not limited to, any damages accruing upon termination of this
Lease and/or those sums reasonably necessary to compensate Landlord for any
other actual damage, foreseeable or unforeseeable, caused by the acts or
omissions of Tenant or any officer, employee, agent, contractor or invitee of
Tenant.

       

      (b) Letter of
Credit.  Concurrently with Tenant's execution of this Lease,
Tenant shall deliver to Landlord an unconditional, irrevocable and renewable
letter of credit ("Letter of
Credit") in favor of Landlord substantially in the form attached hereto
as Exhibit E, issued by Silicon Valley Bank or other bank reasonably
satisfactory to Landlord with a branch which will honor draws located in the
Seattle area or permitting draws electronically or by mail, overnight courier or
facsimile, in the principal amount ("Stated
Amount") specified below, to be held by Landlord in accordance with the
terms, provisions and conditions of this Lease.  Tenant shall pay all
expenses, points and/or fees incurred by Tenant in obtaining the Letter of
Credit.  If the Letter of Credit delivered by Tenant is inconsistent
with the form attached hereto as Exhibit E (including, without limitation,
the wrong name or address for the Beneficiary), Landlord may so notify Tenant in
writing, in which case Tenant shall cause the Letter of Credit to be corrected
within five (5) business days after such notice.  The Stated Amount
shall initially be Five Hundred Sixty-Four Thousand Dollars ($564,000.00);
provided, however, that, except as 


         

        
          
             

          

          
            9

            
              
 

          

          
             

hereinafter provided,
upon the dates specified below ("Adjustment
Dates"), the Stated Amount shall be reduced to the following
amounts:

        

      

      
        	
                Date

              	 	
                Stated
    Amount

              	 
	
                November 30,
      2011

              	 	$	376,000.00	 
	
                November 30,
      2012

              	 	$	188,000.00	 
	
                November 30,
      2013

              	 	$	0.00	 


      

       

      However,
if Tenant does not utilize the entire Improvement Allowance by the earlier of
(i) the date Tenant gives Landlord written notice that it will not seek to
obtain any credit for any unused portion of the Improvement Allowance or (ii)
March 31, 2009, then, subject to the next sentence below, Tenant may cause
the Stated Amount to be reduced on such date by the amount of the Improvement
Allowance which is not so utilized by Tenant and the Stated Amount may be
further reduced upon the Adjustment Dates on a proportionate basis (i.e., on the
first (1st)
Adjustment Date, the Stated Amount may be reduced to two-thirds (2/3rds) of
the revised original Stated Amount, on the second (2nd)
Adjustment Date, the Stated Amount may be reduced to one-third (1/3) of the
revised original Stated Amount, and upon the third (3rd)
Adjustment Date, the Stated Amount may be reduced to zero
dollars).  Furthermore, if (i) a default by Tenant occurs under
this Lease, or (ii) circumstances exist that would, with notice or lapse of
time, or both, constitute a default by Tenant, and Tenant has failed to cure
such default within the time period permitted by Article 19 or such lesser
time as may remain before the relevant Adjustment Date as provided above, the
Stated Amount shall not thereafter be reduced unless and until such default
shall have been fully cured pursuant to the terms of this Lease, at which time
the Stated Amount may be reduced as hereinabove described.  Upon any
change to the Stated Amount, the Letter of Credit shall be concurrently amended
or replaced by a Letter of Credit in the new reduced Stated Amount, and Landlord
and Tenant shall take the steps reasonably necessary to cause the existing
Letter of Credit to be delivered to the issuing bank and the issuing bank to
amend the Letter of Credit or issue a new replacement Letter of Credit in the
new reduced Stated Amount on the date the Stated Amount is required to be
adjusted.  The Letter of Credit shall state that an authorized officer
or other representative of Landlord may make demand on Landlord's behalf for the
Stated Amount of the Letter of Credit, or any portion thereof, and that the
issuing bank must immediately honor such demand upon presentation to it of the
original Letter of Credit, without qualification or satisfaction of any
conditions, except the proper identification of the party making such demand and
such party's certification that Landlord is entitled to draw on the Letter of
Credit pursuant to this Lease.  In addition, the Letter of Credit
shall indicate that it is transferable in its entirety by Landlord as
beneficiary to any transferee of Landlord's interest under this Lease who
assumes Landlord's obligations under this Lease or to a lender under any
mortgage or deed of trust encumbering the Project (provided that such lender
agrees that draws may be made on the Letter of Credit only as permitted by this
Lease, the drawn amounts shall only be used, applied or retained as permitted by
this Lease, the drawn amounts shall be returned to Tenant to the extent required
by this Lease, and that no further assignments shall be made by such lender of
the beneficiary's interest in the Letter of Credit except as permitted by this
Lease) and that upon receiving written notice of transfer along with such
party's certification confirming that the transfer meets the above requirements,
and upon presentation to the issuing bank of the original Letter of Credit, the
issuer or confirming bank will reissue the Letter of Credit naming such
transferee as the beneficiary.  Tenant shall be responsible for the
payment to the issuing bank of any transfer costs imposed by the issuing bank in
connection with any such transfer.  If (A) the term of the Letter
of Credit held by Landlord will expire prior to the last Adjustment Date
specified above and the Letter of Credit is not extended, or a new Letter of
Credit for an extended period of time is not substituted, in either case at
least (30) days prior to the expiration of the Letter of Credit, or (B) an
Event of Default has occurred and is continuing, including the filing of a
voluntary petition under Title 11 of the United States Code (i.e., the
bankruptcy Code), or Tenant otherwise becomes a debtor in any case or proceeding
under the Bankruptcy Code, as now existing or hereinafter amended, or any
similar law or statute, Landlord may (but shall not be required to) draw upon
all or any portion of the Stated Amount of the Letter of Credit, and the
proceeds received from such draw shall constitute Landlord's property (and not
Tenant's property or the property of the bankruptcy estate of Tenant) and
Landlord may then use, apply or retain all or any part of the proceeds
(1) for the payment of any sum which is in default, (2) to reimburse
Landlord for any expense actually and reasonably incurred by Landlord as a
result of Tenant's default, and (3) if Landlord has terminated this Lease,
the damages to which Landlord is entitled 



        
          
             

          

          
            10

            
              
 

          

          
             

pursuant to
Article 20 of this Lease.  If any portion of the Letter of Credit
proceeds are so used or applied, Tenant shall, within ten (10) days after demand
therefor, post an additional Letter of Credit in an amount to cause the
aggregate amount of the unused proceeds and such new Letter of Credit to equal
the Stated Amount required in this Article 4 above.  Landlord
shall not be required to keep any proceeds from the Letter of Credit separate
from its general funds.  Should Landlord sell its interest in the
Premises during the Lease Term, Landlord shall transfer the Letter of Credit and
any unapplied proceeds of the Letter of Credit to the purchaser, and if Landlord
transfers the Letter of Credit and deposits with the purchaser thereof the
Letter of Credit and any unapplied proceeds of the Letter of Credit and such
purchaser assumes in writing Landlord’s obligations with respect thereto,
thereupon Landlord shall be discharged from any further liability with respect
to the Letter of Credit and said proceeds and Tenant shall look solely to such
transferee for the return of the Letter of Credit or any proceeds
therefrom.  The Letter of Credit or any remaining proceeds of the
Letter of Credit held by Landlord after expiration or earlier termination of the
Lease Term, after any deductions described in this Article 4 above, shall
be returned to Tenant or, at Landlord's option, to the last assignee of Tenant's
interest hereunder, within sixty (60) days following the expiration of the
Lease Term; provided, if the Stated Amount is reduced while Landlord is holding
any such unapplied proceeds, Landlord shall promptly return to Tenant (so long
as no Event of Default is continuing) the amount by which such proceeds and the
remaining balance of the Letter of Credit exceeds the reduced Stated
Amount.The use,
application or retention of the Letter of Credit, the proceeds or any portion
thereof, shall not prevent Landlord from exercising any other rights or remedies
provided under this Lease, it being intended that Landlord shall not be required
to proceed against the Letter of Credit, and such use, application or retention
of the Letter of Credit shall not operate as a limitation on any recovery to
which Landlord may otherwise be entitled.  No trust relationship is
created herein between Landlord and Tenant with respect to the Letter of
Credit.

        

      

       

      Landlord
and Tenant acknowledge and agree that in no event or circumstance shall the
Letter of Credit, any renewal thereof or substitute therefor or the proceeds
thereof be deemed to be or treated as a "security deposit" within the meaning of
any laws or statutes.  The parties hereto (A) recite that the
Letter of Credit is not intended to serve as a security deposit and any laws,
rules and regulations applicable to security deposits in the commercial context
("Security
Deposit Laws") shall have no applicability or relevancy thereto and
(B) waive any and all rights, duties and obligations either party may now
or, in the future, will have relating to or arising from the Security Deposit
Laws.  Notwithstanding the foregoing, to the extent any Security
Deposit Law in any way: (a) is applicable to this Lease or the Letter of Credit
(or any proceeds thereof); or (b) controls Landlord's rights to draw on the
Letter of Credit or apply the proceeds of the Letter of Credit to any amounts
due under this Lease or any damages Landlord may suffer following termination of
this Lease, then Tenant fully and irrevocably waives the benefits and
protections of such Security Deposit Law, it being agreed that Landlord may
recover from the Letter of Credit (or its proceeds) amounts expressly provided
in this Article 4.

       

      ARTICLE
5

       

      HOLDING
OVER

       

      Should
Tenant, without Landlord's written consent, hold over after termination of this
Lease, Tenant shall, at Landlord's option, become either a tenant at sufferance
or a month-to-month tenant upon each and all of the terms herein provided as may
be applicable to such a tenancy and any such holding over shall not constitute
an extension of this Lease.  During such holding over, Tenant shall
pay in advance, monthly, Basic Rental at a rate equal to one hundred fifty
percent (150%) of the rate in effect for the last month of the Term of this
Lease or one hundred percent (100%) of Landlord's then asking rate for
comparable space in the Project, whichever is greater, in addition to, and not
in lieu of, all other payments required to be made by Tenant hereunder including
but not limited to Tenant's Proportionate Share of any increase in Direct
Costs.  Nothing contained in this Article 5 shall be construed as
consent by Landlord to any holding over of the Premises by Tenant, and Landlord
expressly reserves the right to require Tenant to surrender possession of the
Premises to Landlord as provided in this Lease upon the expiration or earlier
termination of the Term.  If Tenant fails to surrender the Premises
upon the expiration or termination of this Lease, Tenant agrees to indemnify,
defend and hold Landlord 

      
 

      
        
           

        

        
          11

          
            
 

        

        
           

        

      

      
harmless from all costs, loss,
expense or liability, including without limitation, claims made by any
succeeding tenant and real estate brokers claims and attorney's fees and
costs.

       

      ARTICLE
6

       

      OTHER
TAXES

       

      Tenant
shall pay, prior to delinquency, all taxes assessed against or levied upon trade
fixtures, furnishings, equipment and all other personal property of Tenant
located in the Premises.  In the event any or all of Tenant's trade
fixtures, furnishings, equipment and other personal property shall be assessed
and taxed with property of Landlord, or if the cost or value of any leasehold
improvements in the Premises exceeds the cost or value of a Project-standard
buildout as determined by Landlord and, as a result, real property taxes for the
Project are increased, Tenant shall pay to Landlord, within ten (10) days after
delivery to Tenant by Landlord of a written statement setting forth such amount,
the amount of such taxes applicable to Tenant's property or above-standard
improvements.  Tenant shall assume and pay to Landlord at the time
Basic Rental next becomes due (or if assessed after the expiration of the Term,
then within ten (10) days), any excise, sales, use, rent, occupancy, garage,
parking, gross receipts or other taxes (other than net income taxes) which may
be assessed against or levied upon Landlord on account of letting of the
Premises to Tenant or the payment of Basic Rental or any other sums due or
payable hereunder, and which Landlord may be required to pay or collect under
any law now in effect or hereafter enacted.  In addition to Tenant's
obligation pursuant to the immediately preceding sentence, Tenant shall pay
directly to the party or entity entitled thereto all business license fees,
gross receipts taxes and similar taxes and impositions which may from time to
time be assessed against or levied upon Tenant, as and when the same become due
and before delinquency.  Notwithstanding anything to the contrary
contained herein, any sums payable by Tenant under this Article 6 shall not
be included in the computation of "Tax Costs."

       

      ARTICLE
7

       

      USE

       

      Tenant
shall use and occupy the Premises only for the use set forth in
Article 1.F. of the Basic Lease Provisions and shall not use or occupy the
Premises or permit the same to be used or occupied for any other purpose without
the prior written consent of Landlord, which consent may be given or withheld in
Landlord's sole and absolute discretion, and Tenant agrees that it will use the
Premises in such a manner so as not to unreasonably interfere with or infringe
upon the rights of other tenants or occupants in the Project.  Subject
to casualty, condemnation and repairs, Tenant shall have the right to use and
have access to the Premises and the common areas serving the Premises on a seven
(7) days a week, twenty-four (24) hours a day basis throughout the Term without
obtaining any consent from or giving notice to Landlord.  Except to
the extent such compliance obligations are otherwise those of Landlord as
provided herein, Tenant shall, at its sole cost and expense, promptly comply
with all applicable laws, statutes, ordinances, governmental regulations or
requirements (collectively, "Laws") now in
force or which may hereafter be in force relating to or affecting (i) the
condition, use or occupancy of the Premises or the Project (excluding structural
changes to the Project not related to Tenant's particular use of the Premises),
and (ii) improvements installed or constructed in the Premises by or for the
benefit of Tenant.  Tenant's use of the Premises shall be subject to
all applicable Laws including, without limitation, any applicable zoning
laws.  Tenant shall not knowingly do or permit to be done anything
which would invalidate or increase the cost of any insurance policy covering the
Project and/or the property located therein and Tenant shall comply (but without
obligation to install any improvements or additions or make any upgrades) with
all rules, orders, regulations and requirements of any organization which sets
out standards, requirements or recommendations commonly referred to by major
fire insurance underwriters, and Tenant shall promptly upon demand reimburse
Landlord for any additional premium charges for any such insurance policy
assessed or increased by reason of Tenant's failure to comply with the
provisions of this Article.  Tenant agrees not to keep any trash,
garbage, waste or other refuse on the Premises except in sanitary containers and
agrees to regularly and frequently remove same from the
Premises.  Tenant shall keep all containers or other equipment used
for storage of such materials in a clean and sanitary
condition.  Tenant shall keep the sewage disposal system in the
Premises free of all obstructions and in good operating condition.  If
the volume of Tenant's trash 

       

      
        
          
             

          

          
            12

            
              
 

          

          
             

becomes
excessive in Landlord's judgment, Landlord shall have the right to charge Tenant
for additional trash disposal services and/or to require that Tenant contract
directly for additional trash disposal services at Tenant's sole cost and
expense.  Tenant shall, at its own cost, retain a licensed, bonded
professional pest and sanitation control service to perform inspections of the
Premises not less frequently than quarterly for the purpose of eliminating
infestation by and controlling the presence of insects, rodents and vermin and
shall promptly cause any corrective or extermination work recommended by such
service to be performed.  Such work shall be performed pursuant to a
written contract, a copy of which shall be delivered to Landlord by Tenant upon
request.

        

      

       

      ARTICLE
8

       

      CONDITION OF
PREMISES

       

      Tenant
hereby agrees that except as otherwise expressly provided in this Lease or as
provided in the Tenant Work Letter attached hereto as Exhibit "D" and made a
part hereof and without limiting Landlord’s repair and maintenance obligations
set forth in this Lease, the
Premises shall be taken "as is", "with all faults", "without any representations
or warranties", and Tenant hereby agrees and warrants that it has investigated
and inspected the condition of the Premises and the suitability of same for
Tenant's purposes, and except for any obligations of Landlord expressly set
forth in this Lease, Tenant does hereby waive and disclaim any objection to,
cause of action based upon, or claim that its obligations hereunder should be
reduced or limited because of the condition of the Premises or the Project as of
the Commencement Date or the suitability of same for Tenant's
purposes.  Tenant acknowledges that, except as expressly set forth in
this Lease,  neither Landlord nor any agent nor any employee of
Landlord has made any representations or warranty with respect to the Premises
or the Project or with respect to the suitability of either for the conduct of
Tenant's business and Tenant expressly warrants and represents that, except as
expressly set forth in this Lease, Tenant has relied solely on its own
investigation and inspection of the Premises and the Project in its decision to
enter into this Lease and let the Premises in the above-described
condition.  In addition to the existing leasehold improvements in the
Premises,  the Premises shall be initially improved as provided in,
and subject to, the Tenant Work Letter attached hereto as Exhibit "D" and
made a part hereof.  The existing leasehold improvements in the
Premises as of the date of this Lease, together with the Improvements (as
defined in the Tenant Work Letter) may be collectively referred to herein as the
"Tenant
Improvements."  The taking of possession of the Premises by
Tenant shall conclusively establish that the Premises and the Project were at
such time in satisfactory condition, subject to latent defects, punch-list
items, conditions or items that are not in compliance with Laws, and conditions
or items covered by construction warranties.  Tenant hereby waives any
provisions of law which would otherwise permit Tenant to make repairs required
of Landlord under this Lease.

       

      ARTICLE
9

       

      REPAIRS AND
ALTERATIONS

       

      (a) Landlord's
Obligation.  Landlord shall maintain and repair the
Project-wide systems and the structural portions of the Project including,
without limitation, the foundation, floor/ceiling slabs, roof, curtain wall,
exterior glass, columns, beams, shafts, stairs, stairwells and common
areas.  Landlord shall also repair at its sole cost and expense, any
latent defects in the design or construction of the Project or Development
Common Areas, any defects in the Improvements which constitute a breach of the
one-year construction warranty provided by the Contractor who installs the
Improvements or are not installed in accordance with the approved drawings,
plans and specifications.  Landlord shall, at no cost to Tenant, make
such modifications, repairs and upgrades to the Project and Development Common
Areas as are necessary to comply with disability, life, seismic, fire and safety
codes, ordinances, statutes, or any other applicable Laws in effect on or prior
to the Commencement Date, including, without limitation, then current
requirements of the Americans with Disabilities Act.  Notwithstanding
any provision set forth in this Article 9 to the contrary, if Tenant provides
written notice to Landlord of an event or circumstance which requires the action
of Landlord with respect to repair and/or maintenance of the Premises only (and
not any other portion of the Project), and Landlord fails to provide such action
within thirty (30) days after Landlord's receipt of such 

       

      
        
          
             

          

          
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notice, or if the nature of the work reasonably requires
more than thirty (30) days to complete, and such work is not commenced by
Landlord within thirty (30) days after such notice and thereafter continuously
and diligently pursued by Landlord to completion within a reasonable time, then
Tenant may proceed to take the required action upon delivery of an additional
ten (10) days notice to Landlord specifying that Tenant is taking such required
action, and if such action was required under the terms of the Lease to be taken
by Landlord and was not taken by Landlord within such ten (10) day period, then
Tenant shall be entitled to prompt reimbursement by Landlord of Tenant's actual
and reasonable costs in taking such action.  However, if the work so
performed by Tenant pertains to items that would otherwise be includable under
Direct Costs pursuant to Article 3 above, then Landlord may include the
amount of such reimbursement in Direct Costs.  In the event Tenant
takes such action, and such work will affect the Project systems or the
structural integrity of the Project, Tenant shall use only those contractors
used by Landlord in the Project for work on such Project systems or structure
unless such contractors are unwilling or unable to perform, or timely perform,
such work, in which event Tenant may utilize the services of any other qualified
contractor which normally and regularly performs similar work in comparable
first-class buildings.(b) Tenant's
Obligation.  Except as expressly provided as Landlord's
obligation in this Article 9, Tenant shall keep the Premises, all systems
therein exclusively serving the Premises and the backup generator described in
Section 11(e) below in good condition and repair.  Except to the
extent covered by insurance and subject to the waiver of subrogation provision
herein, all damage or injury to the Premises or the Project resulting from the
wrongful act or negligence of Tenant, its employees, agents or visitors, guests,
invitees or licensees, or by the use of the Premises, shall be promptly repaired
by Tenant at its sole cost and expense, to the reasonable satisfaction of
Landlord; provided, however, that for damage to the Project as a result of
casualty or for any repairs that may impact the mechanical, electrical,
plumbing, heating, ventilation or air-conditioning systems of the Project,
Landlord shall have the right (but not the obligation) to select the contractor
and oversee all such repairs.  Landlord may make any repairs that are
Tenant's responsibility which are not promptly made by Tenant after Tenant's
receipt of written notice and the reasonable opportunity of Tenant to make said
repair within five (5) business days from receipt of said written notice, and
charge Tenant for the cost thereof, which cost shall be paid by Tenant within
five (5) days from invoice from Landlord.  Subject to the provisions
of the Tenant Work Letter, Tenant shall be responsible for the design and
function of all non-standard improvements of the Premises, made by or at the
request of Tenant, whether or not installed by Landlord at Tenant's
request.  Except as expressly provided in Section 9(a) above,
Tenant waives all rights to make repairs at the expense of Landlord, or to
deduct the cost thereof from the rent.

      

       

      (c) Alterations.  Tenant
shall make no alterations, installations, changes or additions in or to the
Premises or the Project (collectively, "Alterations")
without Landlord's prior written consent.  Notwithstanding anything to
the contrary contained herein, Tenant may make strictly cosmetic changes to the
finish work in the Premises (the "Cosmetic
Alterations"), without Landlord's consent, provided that the aggregate
cost of any such alterations does not exceed $20,000.00 in any twelve (12) month
period, and further provided that such alterations do not (i) require any
structural or other substantial modifications to the Premises, (ii) require
any changes to, nor adversely affect, the systems and equipment of the Project,
or (iii) affect the exterior appearance of the Project.  Tenant
shall give Landlord at least ten (10) days prior notice of such Cosmetic
Alterations, which notice shall be accompanied by reasonably adequate evidence
that such changes meet the criteria contained in this
Section 9(c).  As used herein, the term "Alterations" does not
include any of the Tenant Improvements.  Any Alterations approved by
Landlord must be performed in accordance with the terms hereof, using only
contractors approved by Landlord in writing and upon the approval by Landlord in
writing of fully detailed and dimensioned plans and specifications pertaining to
the Alterations in question, to be prepared and submitted by Tenant at its sole
cost and expense.  Tenant shall at its sole cost and expense obtain
all necessary approvals and permits pertaining to any
Alterations.  Tenant shall cause all Alterations to be performed in a
good and workmanlike manner, in conformance with all applicable federal, state,
county and municipal laws, rules and regulations, pursuant to a valid building
permit (if one is required), and in conformance with Landlord's construction
rules and regulations.  If Landlord, in approving any Alterations,
specifies a commencement date therefor, Tenant shall not commence any work with
respect to such Alterations prior to such date; provided that Tenant shall be
entitled to commence such work within thirty (30) days after such approval is
given.  Tenant hereby agrees to indemnify, defend, and hold Landlord
free and harmless from all liens and claims of lien, and all other liability,
claims and demands arising out 



        
          
             

          

          
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of any work done or material
supplied to the Premises by or at the request of Tenant in connection with any
Alterations.(d) Insurance;
Liens.  Prior to the commencement of any Alterations requiring
Landlord's consent, Tenant shall, upon Landlord's request, provide Landlord with
evidence that Tenant carries "Builder's Risk" insurance in an amount approved by
Landlord covering the construction of such Alterations, and such other insurance
as Landlord may reasonably require, it being understood that all such
Alterations shall be insured by Tenant pursuant to Article 14 of this Lease
immediately upon completion thereof.  In addition, for Alterations
requiring Landlord's consent, Landlord may, in its discretion, require Tenant to
obtain a payment and performance bond or some alternate form of security
satisfactory to Landlord in an amount sufficient to ensure the lien free
completion of such Alterations and naming Landlord as a
co-obligee.

      

       

      (e) Costs and
Fees; Removal.  If permitted Alterations are made, they shall
be made at Tenant's sole cost and expense and shall be and become the property
of Landlord, except that Landlord may, by written notice to Tenant given at the
time of Landlord's consent to such Alteration or Improvement (provided Tenant
requests that Landlord make such determination at the time of Tenant's request
for consent) or in the case of Cosmetic Alterations, by written notice to Tenant
within fifteen (15) days after Landlord's receipt of Tenant's notice of such
Cosmetic Alterations (provided Tenant requests that Landlord make such
determination at the time of Tenant's notice), require Tenant at Tenant's
expense to remove such Improvements and Alterations from the Premises at the
expiration or earlier termination of this Lease, and to repair any damage to the
Premises and the Project caused by such removal.  Any and all costs
attributable to or related to the applicable building codes of the city in which
the Project is located (or any other authority having jurisdiction over the
Project) arising from Tenant's Alterations shall be paid by Tenant at its sole
cost and expense.  With regard to repairs required to be made by
Tenant, Alterations or any other work arising from or related to this
Article 9, Landlord shall be entitled to receive a reasonable
administrative/coordination fee (which fee shall vary depending upon whether or
not Tenant orders the work directly from Landlord) sufficient to compensate
Landlord for all overhead, general conditions, fees and other costs and expenses
arising from Landlord's involvement with such work, provided such fee shall in
no event exceed five percent (5%) of the cost of the work.  The
construction of initial improvements to the Premises shall be governed by the
terms of the Tenant Work Letter and not the terms of this Article 9, except
as expressly provided in the first sentence of this
Section 9(e).  Notwithstanding anything to the contrary in this
Lease, Tenant shall have no obligation to remove any of the existing leasehold
improvements in the Premises.

       

      ARTICLE
10

       

      LIENS

       

      Tenant
shall keep the Premises and the Project free from any mechanics' liens, vendors
liens or any other liens arising out of any work performed, materials furnished
or obligations incurred by Tenant, and Tenant agrees to defend, indemnify and
hold Landlord harmless from and against any such lien or claim or action
thereon, together with costs of suit and reasonable attorneys' fees and costs
incurred by Landlord in connection with any such claim or
action.  Before commencing any work of alteration, addition or
improvement to the Premises, Tenant shall give Landlord at least ten (10)
business days' written notice of the proposed commencement of such
work.  In the event that there shall be recorded against the Premises
or the Project or the property of which the Premises is a part any claim or lien
arising out of any such work performed, materials furnished or obligations
incurred by Tenant and such claim or lien shall not be removed or discharged by
Tenant pursuant to RCW 60.04.161 (or any successor statute(s)) within ten (10)
days after written notice to Tenant of such filing, Landlord shall have the
right but not the obligation to pay and discharge said lien without regard to
whether such lien shall be lawful or correct, unless Tenant promptly (within
three (3) days after demand) deposits with Landlord in cash, lawful money of the
United States, one hundred fifty percent (150%) of the amount of such claim,
which sum may be retained by Landlord until such claim shall have been removed
of record or until judgment shall have been rendered on such claim and such
judgment shall have become final, at which time Landlord shall have the right to
apply such deposit in discharge of the judgment on said claim and any costs,
including attorneys' fees and costs incurred by Landlord, and shall remit the
balance thereof to Tenant.

       

      
        
           

        

        
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      ARTICLE
11

       

      PROJECT
SERVICES

       

      (a) Basic
Services.  Landlord shall provide the existing equipment
servicing the Premises in its "as is" but operable condition in order to provide
electric current, heat and air-conditioning therein.  Landlord and
Tenant hereby acknowledge that an independent heating, ventilation and
air-conditioning system ("HVAC System")
will service the Premises.  Landlord shall be responsible for the
maintenance and repair of the HVAC System and shall, as an Operating Cost,
maintain a service and maintenance contract for such HVAC System with a
contractor reasonably designated by Landlord, which contractor shall perform all
maintenance and repairs on the HVAC System as reasonably determined by Landlord
to be necessary.  Tenant shall be entitled to utilize the existing
supplementary heating, ventilation and air conditioning system for a portion of
the Premises and to install, as an Improvement or as an Alteration, subject to
Landlord's reasonable approval of plans and specifications, other heating,
ventilation and air conditioning units (collectively, "Supplementary
Units") within the Premises at Tenant's sole cost and expense (or as a
charge to the Improvement Allowance).  A submeter will also be
installed, at Tenant's sole cost and expense (or as a charge to the Improvement
Allowance) in order to measure the amount of electricity furnished to the
Supplementary Units and Tenant shall be responsible for Landlord's actual cost
of supplying electricity to such units as reasonably determined by Landlord
based upon such submeter, which amounts shall be payable on a monthly basis as
Additional Rent.  Tenant shall be solely responsible for maintenance
and repair of the Supplementary Units and such units shall be considered to be a
fixture within the Premises and shall remain upon the Premises upon the
expiration or earlier termination of this Lease. Except as otherwise provided in
this Lease, the electricity and other utilities furnished to the Premises shall
be included in Operating Costs.  Tenant shall be responsible for
retaining a bonded janitorial contractor, which contractor shall be reasonably
approved by Landlord, and Tenant hereby acknowledges that Landlord shall have no
obligation whatsoever to provide janitorial service to the
Premises.  Tenant shall comply with all rules and regulations which
Landlord may reasonably establish for the proper functioning and protection of
any common systems of the Project.  Landlord shall not be liable for,
and except as expressly provided in Section 11(f) below, there shall be no
rent abatement as a result of, any stoppage, reduction or interruption of any
such services caused by governmental rules, regulations or ordinances, riot,
strike, labor disputes, breakdowns, accidents, necessary repairs or other
cause.  In the event of interruption of services to the Premises,
Landlord shall use commercially reasonable efforts to cause the services to be
promptly restored.  Except as specifically provided in this
Article 11, Tenant agrees to pay for all utilities and other services
utilized by Tenant and any additional building services furnished to Tenant
which are not uniformly furnished to all tenants of the Project at the rate
generally charged by Landlord to tenants of the Project for such utilities or
services.

       

      (b) HVAC
Balance.  If any lights, machines or equipment (including but
not limited to computers and computer systems and appurtenances) are used by
Tenant in the Premises which materially affect the temperature otherwise
maintained by the air conditioning system, or generate substantially more heat
in the Premises than may be accommodated by the system, Tenant shall be
responsible for installing, at Tenant's sole cost and expense, any machinery and
equipment reasonably necessary to restore temperature balance, including but not
limited to modifications to the standard air conditioning
equipment.

       

      (c) Telecommunications.  Upon
request from Tenant from time to time, Landlord will provide Tenant with a
listing of telecommunications and media service providers serving the Project,
and Tenant shall have the right to contract directly with the providers of its
choice.  If Tenant wishes to contract with  or obtain
service from any provider which does not currently serve the Project or wishes
to obtain from an existing carrier services which will require the installation
of additional equipment, such provider must, prior to providing service, enter
into a written agreement with Landlord setting forth the terms and conditions of
the access to be granted to such provider.  In considering the
installation of any new or additional telecommunications cabling or equipment at
the Project, Landlord will consider all relevant factors in a reasonable and
non-discriminatory manner, including, without limitation, the existing
availability of services at the Project, the impact of the proposed
installations upon the Project and its operations and the available space and
capacity for the proposed installations.  Landlord may also consider
whether the proposed service may result in interference with or interruption of


       

      
        
           

        

        
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other services at the Project or the business operations
of other tenants or occupants of the Project.  In no event shall
Landlord be obligated to incur any costs or liabilities in connection with the
installation or delivery of telecommunication services or facilities at the
Project.  All such installations shall be subject to Landlord’s prior
approval, not to be unreasonably withheld, and shall be performed in accordance
with the terms of Article 9.  If Landlord approves the proposed
installations in accordance with the foregoing, Landlord will deliver its
standard form agreement upon request and will use commercially reasonable
efforts to promptly enter into an agreement on reasonable and non-discriminatory
terms with a qualified, licensed and reputable carrier confirming the terms of
installation and operation of telecommunications equipment consistent with the
foregoing.

       

      (d) Sole
Electrical Representative.  Tenant agrees that Landlord shall
be the sole and exclusive representative to the electrical service provider with
respect to, and shall maintain exclusive control over, the reception,
utilization and distribution of electrical power to the Project, regardless of
point or means of origin, use or generation.

       

      (e) Backup
Generator.  Throughout the Term of this Lease (as may be
extended), Tenant shall be entitled to utilize the existing backup generator for
the Premises.  Tenant acknowledges that Landlord is providing such
backup generator in its "as is" condition and that Landlord makes no
representation or warranty with respect to the condition of such backup
generator or its suitability for Tenant's use and Landlord shall have no
maintenance or repair obligations with respect to the backup
generator.  Such backup generator may be used by Tenant only during
(i) testing and regular maintenance, and (ii) any period of electrical
power outage in the Project.  Tenant shall be entitled to operate the
backup generator for testing and regular maintenance only upon notice to
Landlord and at times reasonably approved by Landlord.  In addition,
Tenant shall ensure that the backup generator does not result in any Hazardous
Materials being introduced to the Project in violation of applicable law, and
Section 28(a) will apply to Tenant's use of the backup
generator.  Further, Tenant shall be responsible for ensuring that the
backup generator does not interfere with the use of the Project by other
tenants.  Such backup generator shall be deemed to be a part of the
Premises for purposes of Article 14 of this Lease.

       

      (f) Abatement
Events.  An "Abatement
Event" shall be defined as an event that prevents Tenant from using the
Premises or any portion thereof, as a result of any failure to provide services
or access to the Premises or as a result of Landlord's activities pursuant to
Section 12(b) below or as a result of the presence of Hazardous Materials
in violation of Environmental Laws not caused by Tenant, its agents, employees,
contractors or invitees, where (i) Tenant does not actually use the
Premises or such portion thereof, and (ii) such event is not caused by the
negligence or willful misconduct of Tenant, its agents, employees or
contractors.  Tenant shall give Landlord notice ("Abatement
Notice") of any such Abatement Event, and if such Abatement Event
continues beyond the "Eligibility Period" (as that term is defined below), then
the Basic Rental and Tenant's Proportionate Share of Direct Costs shall be
abated entirely or reduced, as the case may be, after expiration of the
Eligibility Period for such time that Tenant continues to be so prevented from
using, and does not use, the Premises or such portion thereof, in the proportion
that the rentable area of the portion of the Premises that Tenant is prevented
from using, and does not use, bears to the total rentable area of the Premises;
provided, however, in the event that Tenant is prevented from using, and does
not use, a portion of the Premises for a period of time in excess of the
Eligibility Period and the remaining portion of the Premises is not sufficient
to allow Tenant to effectively conduct its business therein, and if Tenant does
not conduct its business from such remaining portion, then for such time after
expiration of the Eligibility Period during which Tenant is so prevented from
effectively conducting its business therein, the Basic Rental and Tenant's
Proportionate Share of Direct Costs for the entire Premises shall be abated
entirely for such time as Tenant continues to be so prevented from using, and
does not use, the Premises.  If, however, Tenant reoccupies any
portion of the Premises during such period, the Basic Rental and Tenant's
Proportionate Share of Direct Costs allocable to such reoccupied portion, based
on the proportion that the rentable area of such reoccupied portion of the
Premises bears to the total rentable area of the Premises, shall be payable by
Tenant from the date Tenant reoccupies such portion of the
Premises.  The term "Eligibility
Period" shall mean a period of five (5) consecutive business days after
Landlord's receipt of any Abatement Notice(s).  Such right to abate
Basic Rental and Tenant's Proportionate Share of Direct Costs shall be Tenant's
sole and exclusive remedy at law or in equity for an Abatement
Event.

       

      
        
           

        

        
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      ARTICLE
12

       

      RIGHTS OF
LANDLORD

       

      (a) Right of
Entry.  Landlord and its agents shall have the right to enter
the Premises at all reasonable times upon twenty-four (24) hours prior notice
(except that no notice shall be required in the case of an emergency or
regularly scheduled service) for the purpose of examining or inspecting the
same, serving or posting and keeping posted thereon notices as provided by law,
or which Landlord deems necessary for the protection of Landlord or the Project,
showing the same to prospective tenants, lenders or purchasers of the Project,
in the case of an emergency, and for making such alterations, repairs,
improvements or additions to the Premises or to the Project as Landlord may deem
necessary or desirable and are otherwise permitted by this Lease; provided,
however, that except in the case of an emergency, no such entry into the Lab
Portion of the Premises shall be permitted without Landlord permitting Tenant to
have a representative of Tenant present and, if required by Tenant, any such
individuals entering the Lab Portion of the Premises shall wear protective
goggles and such other protective clothing or equipment as Tenant may reasonably
require.  Notwithstanding the foregoing, Landlord shall have the right
to enter the Premises to show the same to prospective tenants only during the
last nine (9) months of the Term or the Option Term, if applicable, or at any
time in which Tenant is in default under this Lease after expiration of
applicable cure periods.  If Tenant shall not be personally present to
open and permit an entry into the Premises at any time when such an entry by
Landlord is necessary and otherwise permitted hereunder, Landlord may enter by
means of a master key or may forcibly enter in the case of an emergency, in each
event without liability to Tenant for such entry and without affecting this
Lease.  Notwithstanding the foregoing, (A) except in the event of
the negligence or willful misconduct of Tenant or its agents, contractors or
employees, any entry into the Lab Portion of the Premises by Landlord or any
other party Landlord brings to the Lab Portion of the Premises shall be at their
sole risk and Tenant shall have no liability for injuries or damage any of them
may sustain by reason of such entry into the Lab Portion of the Premises, and
(B) Landlord shall use commercially reasonable efforts to conduct any such
entry with the least inconvenience to Tenant as is reasonably practicable and so
as to minimize, to the extent reasonably practicable, any disruption of or
interference with Tenant's normal operations in the
Premises.  Landlord agrees to use commercially reasonable efforts not
to disclose, use or disseminate or permit the disclosure, use or dissemination
by its employees, agents or contractors of any information concerning Tenant's
prototype tablets, pharmaceutical and nutritional products, research,
development and testing efforts, procedures, methods and results and other
proprietary technology information (collectively, "Confidential
Information") that may be obtained by entry into the Lab Portion of the
Premises by Landlord or its employees, agents or
contractors.  Landlord agrees that Tenant may prohibit the
photographing, video taping, photocopying or other reproduction of any
Confidential Information.  Landlord agrees that Tenant shall be
entitled to pursue a temporary restraining order or other injunctive relief for
any breach by Landlord of its obligations with respect to Confidential
Information as described in this Section 12(a) above.

       

      (b) Maintenance
Work.  Landlord reserves the right from time to time, but
subject to payment by and/or reimbursement from Tenant as may be otherwise
provided herein, at reasonable times and in a reasonable manner: (i) to install,
use, maintain, repair, replace, relocate and control for service to the Premises
and/or other parts of the Project pipes, ducts, conduits, wires, cabling,
appurtenant fixtures, equipment spaces and mechanical systems, wherever located
in the Premises or the Project, (ii) to alter, close or relocate any facility in
the Premises or the common areas or otherwise conduct any of the above
activities for the purpose of complying with a general plan for fire/life safety
for the Project or for repairs, and (iii) to comply with any federal, state or
local law, rule or order.  Landlord shall use commercially reasonable
efforts to perform any such work with the least inconvenience to Tenant as is
reasonably practicable and so as to minimize to the extent reasonably
practicable any disruption of or interference with Tenant’s normal operations in
the Premises, but in no event shall Tenant be permitted to withhold or reduce
Basic Rental or other charges due hereunder as a result of same (except as
provided in Section 11(f) above), make any claim for constructive eviction
or otherwise make any claim against Landlord for interruption or interference
with Tenant's business and/or operations; provided, however, Landlord shall not
be entitled to reduce the useable area of the Premises pursuant to such actions
in a manner or to a degree that would impair Tenant's operations in the
Premises.

       

      
        
           

        

        
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      (c) Rooftop.  If
Tenant desires to use the rooftop of the Project for any purpose, including the
installation of communication equipment to be used from the Premises, such
rights will be granted in Landlord’s sole discretion and Tenant must negotiate
the terms of any rooftop access with Landlord or the rooftop management company
or lessee holding rights to the rooftop from time to time.  Any
rooftop access granted to Tenant will be at prevailing rates and will be
governed by the terms of a separate written agreement or an amendment to this
Lease.

       

      ARTICLE
13

       

      INDEMNITY;
EXEMPTION OF LANDLORD FROM LIABILITY

       

      (a) Indemnity.  Except
for matters and claims for which Landlord is obligated hereunder to indemnify
Tenant, Tenant shall indemnify, defend and hold Landlord, Arden Realty, Inc.,
their subsidiaries, partners, parental or other affiliates and their respective
officers, directors, employees and contractors (collectively, "Landlord
Parties") harmless from and against any and all claims arising from (i)
Tenant's use of the Premises or the Project (including, without limitation,
Tenant's signage) or from the conduct of its business or from any activity, work
or thing which may be permitted or suffered by Tenant in or about the Premises
or the Project, (ii) any breach or default in the performance of any obligation
on Tenant's part to be performed under this Lease, or (iii) any negligence or
willful misconduct of Tenant or any of its agents, contractors, or employees in
or about the Project and from any and all costs, attorneys' fees and costs,
expenses and liabilities incurred in the defense of any claim or any action or
proceeding brought thereon, including negotiations in connection
therewith.  However, notwithstanding the foregoing, Tenant shall not
be required to indemnify, defend and/or hold Landlord harmless from any claim,
loss, cost, liability, damage or expense, including, but not limited to,
penalties, fines, attorneys' fees or costs (collectively, "Claims"), by,
for or to any person, property or entity to the extent resulting from the
negligence or willful misconduct of Landlord or its agents, contractors, or
employees or from Landlord's breach or default in the performance of any
obligation on Landlord's part to be performed under this Lease or covered by
insurance required to be carried under this Lease by Landlord or actually
carried by Landlord.  Landlord hereby indemnifies Tenant and holds
Tenant harmless from any Claims to the extent resulting from the negligence or
willful misconduct of Landlord or its agents, contractors or employees or from
Landlord's breach or default in the performance of any obligation on Landlord's
part to be performed under this Lease and not covered by insurance required to
be carried under this Lease by Tenant or actually carried by Tenant; provided,
however, that (A) because Landlord maintains insurance on the Project and
Tenant compensates Landlord for such insurance as part of Tenant's Proportionate
Share of Direct Costs and because of the existence of waivers of subrogation set
forth in Article 14 of this Lease, Landlord hereby agrees to indemnify,
defend and hold Tenant harmless from any Claims to any property outside of the
Premises to the extent such Claim is covered by such insurance, even if
resulting from the negligent acts, omissions, or willful misconduct of Tenant or
those of its agents, contractors, or employees, and (B) because Tenant must
carry insurance pursuant to Article 14 to cover its personal property
within the Premises and the Tenant Improvements, Tenant hereby agrees to
indemnify, defend and hold Landlord harmless from any Claim to any property
within the Premises, to the extent such Claim is covered by such insurance, even
if resulting from the negligent acts, omissions or willful misconduct of
Landlord or those of its agents, contractors, or employees.  Further,
Tenant's agreement to indemnify Landlord and Landlord's agreement to indemnify
Tenant pursuant to this Section 13(a) is not intended to and shall not
relieve any insurance carrier of its obligations under policies required to be
carried by Landlord or Tenant pursuant to this Lease, to the extent such
policies cover the matters subject to such indemnification
obligations.  Except for matters and Claims for which Landlord is
obligated to indemnify Tenant hereunder, (1) Tenant hereby assumes all risk of
damage to property or injury to persons in or about the Premises from any cause,
and (2) Tenant hereby waives all claims in respect thereof against Landlord and
the Landlord Parties.

       

      (b) Exemption of
Landlord from Liability.  Landlord and the Landlord Parties
shall not be liable for injury to Tenant's business, or loss of income
therefrom, however occurring (including, without limitation, from any failure or
interruption of services or utilities or as a result of Landlord's negligence),
or, subject to the waivers in Article 14(d) below to the extent applicable
and except in connection with damage or injury resulting from the negligence or
willful misconduct of Landlord, its agents  or the Landlord Parties or
Landlord's breach of this Lease or matters or claims for which Landlord is
obligated to indemnify Tenant pursuant to 

       

      
        
           

        

        
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Section 13(a) hereof (provided that in such cases
Landlord's liability shall be limited to amounts not covered by insurance
carried by Tenant or required to be carried by Tenant pursuant to this Lease),
for damage that may be sustained by the person, goods, wares, merchandise or
property of Tenant, its employees, invitees, customers, agents, or contractors,
or any other person in, on or about the Premises directly or indirectly caused
by or resulting from any cause whatsoever, including, but not limited to, fire,
steam, electricity, gas, water, or rain which may leak or flow from or into any
part of the Premises, or from the breakage, leakage, obstruction or other
defects of the pipes, sprinklers, wires, appliances, plumbing, air conditioning,
light fixtures, or mechanical or electrical systems or from intrabuilding
cabling or wiring, whether such damage or injury results from conditions arising
upon the Premises or upon other portions of the Project or from other sources or
places and regardless of whether the cause of such damage or injury or the means
or repairing the same is inaccessible to Tenant.  Except for matters
or Claims for which Landlord is obligated to indemnify Tenant pursuant to
Section 13(a) hereof, Landlord and the Landlord Parties shall not be liable
to Tenant for any damages arising from any willful or negligent action or
inaction of any other tenant of the Project.

       

      (c) Security.  Tenant
acknowledges that Landlord's election whether or not to provide any type of
mechanical surveillance or security personnel whatsoever in the Project is
solely within Landlord's discretion; Landlord and the Landlord Parties shall
have no liability in connection with the provision, or lack, of such services
and Tenant hereby agrees to release Landlord and the Landlord Parties with
regard to any such potential claim.  Landlord and the Landlord Parties
shall not be liable for losses due to theft, vandalism, or like
causes.

       

      ARTICLE
14

       

      INSURANCE

       

      (a) Tenant's
Insurance.  Tenant, shall at all times during the Term of this
Lease, and at its own cost and expense, procure and continue in force the
following insurance coverage:  (i) Commercial General Liability
Insurance, written on an occurrence basis, with a combined single limit for
bodily injury and property damages of not less than Two Million Dollars
($2,000,000) per occurrence and Three Million Dollars ($3,000,000) in the annual
aggregate, including products liability coverage if applicable, owners and
contractors protective coverage, blanket contractual coverage including both
oral and written contracts, and personal injury coverage, covering the insuring
provisions of this Lease and the performance of Tenant of the indemnity and
exemption of Landlord from liability agreements set forth in Article 13
hereof; (ii) a policy of standard fire, extended coverage and special extended
coverage insurance (all risks), including a vandalism and malicious mischief
endorsement, sprinkler leakage coverage and earthquake sprinkler leakage where
sprinklers are provided in an amount equal to the full replacement value new
without deduction for depreciation of all (A) Tenant Improvements,
Alterations, fixtures and other improvements in the Premises, including but not
limited to all mechanical, plumbing, heating, ventilating, air conditioning,
electrical, telecommunication and other equipment, systems and facilities, and
(B) trade fixtures, furniture, equipment and other personal property
installed by or at the expense of Tenant; (iii) Worker's Compensation coverage
as required by law; and (iv) business interruption, loss of income and extra
expense insurance covering any failure or interruption of Tenant's business
equipment (including, without limitation, telecommunications equipment) and
covering all other perils, failures or interruptions sufficient to cover a
period of interruption of not less than twelve (12) months.  Tenant
shall carry and maintain during the entire Term (including any option periods,
if applicable), at Tenant's sole cost and expense, reasonable increased amounts
of the insurance required to be carried by Tenant pursuant to this
Article 14 and such other reasonable types of insurance coverage and in
such reasonable amounts covering the Premises and Tenant's operations therein,
as may be reasonably required by Landlord, but Landlord shall only be entitled
to require such increased amounts and/or other coverages if they are then
generally required by owners of comparable office buildings in the Bothell,
Washington area.

       

      (b) Form of
Policies.  The aforementioned minimum limits of policies and
Tenant's procurement and maintenance thereof shall in no event limit the
liability of Tenant hereunder.  The Commercial General Liability
Insurance policy shall name Landlord, Arden Realty, Inc., Landlord's property
manager, and Landlord's lender(s) (provided Landlord provides Tenant with notice
of the names of such property manager and any such lender(s)), as additional
insureds' with an appropriate endorsement to the policy(s).  All such
insurance policies carried by Tenant 

       

      
        
           

        

        
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shall be with companies having a rating of not less than
A-VIII in Best's Insurance Guide.  Tenant shall furnish to Landlord,
from the insurance companies, or cause the insurance companies to furnish,
certificates of coverage.  The deductible under each such policy shall
be reasonably acceptable to Landlord.  No such policy shall be
cancelable or subject to reduction of coverage below the limits required
hereunder or other modification or cancellation except after thirty (30) days
prior written notice to Landlord by the insurer.  All such policies
shall be endorsed to agree that Tenant's policy is primary and that any
insurance carried by Landlord is excess and not contributing with any Tenant
insurance requirement hereunder.  Tenant shall, at least twenty (20)
days prior to the expiration of such policies, furnish Landlord with renewals or
binders.  Tenant agrees that if Tenant does not take out and maintain
such insurance or furnish Landlord with renewals or binders in a timely manner,
Landlord may (but shall not be required to) procure said insurance on Tenant's
behalf and charge Tenant the cost thereof, which amount shall be payable by
Tenant upon demand with interest (at the rate set forth in Section 20(e)
below) from the date such sums are expended.  Tenant shall have the
right to provide such insurance coverage pursuant to blanket policies obtained
by Tenant, provided such blanket policies expressly afford coverage to the
Premises and to Tenant as required by this Lease.

       

      (c) Landlord's
Insurance.  Landlord shall, as a cost to be included in
Operating Costs, procure and maintain at all times during the Term of this
Lease, (i) a policy or policies of insurance covering loss or damage to the
Project in the amount of the full replacement costs without deduction for
depreciation thereof, providing protection against all perils included within
the classification of fire and extended coverage, vandalism coverage and
malicious mischief, sprinkler leakage, water damage, and special extended
coverage on the building; and (ii) Commercial General Liability Insurance,
written on an occurrence basis, with a combined single limit for bodily injury
and property damage of not less than Two Million Dollars ($2,000,000) per
occurrence and Three Million Dollars ($3,000,000) in the annual aggregate
covering the Project.  Additionally, Landlord may
carry:  (i) Excess Liability Coverage Insurance; and (ii) Earthquake
and/or Flood Damage Insurance; and (iii) Rental Income Insurance; and
(iv) any other forms of insurance Landlord may reasonably deem appropriate
or any lender may require.  The costs of all insurance carried by
Landlord shall be included in Operating Costs.

       

      (d) Waiver of
Subrogation.  Landlord and Tenant each agree to require their
respective insurers issuing the insurance described in Sections 14(a)(ii),
14(a)(iv) and the first sentence of Section 14(c), to waive any rights of
subrogation that such companies may have against the other
party.  Tenant hereby waives any right that Tenant may have against
Landlord and Landlord hereby waives any right that Landlord may have against
Tenant as a result of any loss or damage to the extent such loss or damage is
insurable under such policies.  In addition, as between Landlord and
Tenant only, each party hereby waives its immunity with respect to the other
under the Industrial Insurance Act (RCW Title 51), and/or the Longshoreman's and
Harbor Worker's Act and/or any equivalent acts, and each party expressly agrees
to assume potential liability for actions brought against the other party by
such waiving parties' employees.  The parties have specifically
negotiated this waiver and each party has had the opportunity to, and has been
encouraged to, consult with independent counsel regarding this
waiver.

       

      (e) Compliance
with Law.  Tenant agrees that it will not, at any time, during
the Term of this Lease, carry any stock of goods or do anything in or about the
Premises that will in any way tend to increase the insurance rates upon the
Project.  Tenant agrees to pay Landlord forthwith upon demand the
amount of any increase in premiums for insurance that may be carried during the
Term of this Lease, or the amount of insurance to be carried by Landlord on the
Project resulting from the foregoing, or from Tenant doing any act in or about
the Premises that does so increase the insurance rates, whether or not Landlord
shall have consented to such act on the part of Tenant.  If Tenant
installs upon the Premises any electrical equipment which causes an overload of
electrical lines of the Premises, Tenant shall at its own cost and expense in
accordance with all other Lease provisions (specifically including, but not
limited to, the provisions of Article 9, 10 and 11 hereof), make whatever
changes are necessary to comply with all insurance requirements of the insurance
underwriters and any governmental authority having jurisdiction thereover, but
nothing herein contained shall be deemed to constitute Landlord's consent to
such overloading.  Tenant shall, at its own expense, comply with all
industry-standard insurance requirements applicable to the Premises including,
without limitation, the installation of fire extinguishers (but without
obligation to install any improvements or additions or perform any
upgrades).

       

      
        
           

        

        
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      ARTICLE
15

       

      ASSIGNMENT
AND SUBLETTING

       

      Tenant
shall have no power to, either voluntarily, involuntarily, by operation of law
or otherwise, sell, assign, transfer or hypothecate this Lease, or sublet the
Premises or any part thereof, or permit the Premises or any part thereof to be
used or occupied by anyone other than Tenant or Tenant's employees without the
prior written consent of Landlord, which consent shall not be unreasonably
withheld, conditioned or delayed.  If Tenant is a corporation,
unincorporated association, partnership or limited liability company, the sale,
assignment, transfer or hypothecation of any class of stock or other ownership
interest in such corporation, association, partnership or limited liability
company in excess of fifty percent (50%) in a single transaction shall be deemed
a "Transfer" within the meaning and provisions of this
Article 15.  Tenant may transfer its interest pursuant to this
Lease only upon the following express conditions, which conditions are agreed by
Landlord and Tenant to be reasonable:

       

      (a) That the
proposed Transferee (as hereafter defined) shall be subject to the prior written
consent of Landlord, which consent shall not be unreasonably withheld,
conditioned or delayed  but, without limiting the generality of the
foregoing, it shall be reasonable for Landlord to deny such consent
if:

       

      (i) The use to
be made of the Premises by the proposed Transferee is (a) not generally
consistent with the character and nature of all other tenancies in the Project,
(b) a use which conflicts with any so-called "exclusive" then in favor of, or
for any use which might reasonably be expected to diminish the rent payable
pursuant to any percentage rent lease with another tenant of the Project or any
other buildings which are in the same complex as the Project, or (c) a use which
would be prohibited by any other portion of this Lease (including but not
limited to any Rules and Regulations then in effect);

       

      (ii) The
financial responsibility of the proposed Transferee is not reasonably
satisfactory to Landlord or in any event not at least equal to those which were
possessed by Tenant as of the date of execution of this
Lease;

       

      (iii) The
proposed Transferee is either a governmental agency or instrumentality thereof;
or

       

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

       

      (b) Upon
Tenant's submission of a request for Landlord's consent to any such Transfer,
Tenant shall pay to Landlord Landlord's then standard processing fee and
reasonable attorneys' fees and costs incurred in connection with the proposed
Transfer, such processing and attorneys’ fees and costs not to exceed $1,500 in
the aggregate per proposed Transfer, unless Landlord provides to Tenant evidence
that Landlord has reasonably incurred greater out-of-pocket costs in connection
with the proposed Transfer;

       

      (c) That the
proposed Transferee shall execute an agreement pursuant to which it shall agree
to perform faithfully and be bound by all of the terms, covenants, conditions,
provisions and agreements of this Lease applicable to that portion of the
Premises so transferred; and

       

      (d) That an
executed duplicate original of said assignment and assumption agreement or other
Transfer on a form reasonably approved by Landlord, shall be delivered to
Landlord within five (5) days after the execution thereof, and that such
Transfer shall not be binding upon Landlord until the delivery thereof to
Landlord and the execution and delivery of Landlord's consent
thereto.  It shall be a condition to Landlord's consent to any
subleasing, assignment or other transfer of part or all of Tenant's interest in
the Premises ("Transfer")
that (i) upon Landlord's consent to any Transfer, Tenant shall pay and
continue to pay fifty percent (50%) of any "Transfer Premium" (defined below),
received by Tenant from the Transferee; (ii) any 

       

      
        
           

        

        
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sublessee of part or all of Tenant's interest in the
Premises shall agree that in the event Landlord gives such sublessee notice that
Tenant is in default under this Lease, such sublessee shall thereafter make all
sublease or other payments directly to Landlord, which will be received by
Landlord without any liability whether to honor the sublease or otherwise
(except to credit such payments against sums due under this Lease and the
sublease), and any sublessee shall agree to attorn to Landlord or its successors
and assigns at their request should this Lease be terminated for any reason,
except that in no event shall Landlord or its successors or assigns be obligated
to accept such attornment; (iii) any such Transfer and consent shall be effected
on forms supplied by Landlord and/or its legal counsel; (iv) Landlord may
require that Tenant not then be in default hereunder in any respect; and (v)
Tenant or the proposed subtenant or assignee (collectively, "Transferee")
shall agree to pay Landlord, upon demand, as Additional Rent, a sum equal to the
additional costs, if any, incurred by Landlord for maintenance and repair as a
result of any change in the nature of occupancy caused by such subletting or
assignment.  "Transfer
Premium" shall mean all rent, Additional Rent or other consideration
payable by a Transferee in connection with a Transfer in excess of the Basic
Rental and Direct Costs payable by Tenant under this Lease during the term of
the Transfer and if such Transfer is for less than all of the Premises, the
Transfer Premium shall be calculated on a rentable square foot
basis.  "Transfer Premium" shall also include, but not be limited to,
key money, bonus money or other cash consideration paid by a Transferee to
Tenant in connection with such Transfer, and any payment in excess of fair
market value for services rendered by Tenant to the Transferee and any payment
in excess of fair market value for assets, fixtures, inventory, equipment, or
furniture transferred by Tenant to the Transferee in connection with such
Transfer.  In any event, the Transfer Premium shall be calculated
after deducting the reasonable expenses incurred by Tenant for (1) any
changes, alterations and improvements to the Premises paid for by Tenant in
connection with the Transfer, (2) any other out-of-pocket monetary
concessions provided by Tenant to the Transferee, and (3) any brokerage
commissions paid for by Tenant and attorneys' fees incurred by Tenant in
connection with the Transfer. Any
Transfer of this Lease which is not in compliance with the provisions of this
Article 15 shall be voidable by written notice from Landlord and shall, if
such non-compliance is not cured by Tenant or such Transfer not rescinded within
ten (10) days after notice from Landlord, at the option of Landlord, terminate
this Lease.  In no event shall the consent by Landlord to any Transfer
be construed as relieving Tenant or any Transferee from obtaining the express
written consent of Landlord to any further Transfer, or as releasing Tenant from
any liability or obligation hereunder whether or not then accrued and Tenant
shall continue to be fully liable therefor.  No collection or
acceptance of rent by Landlord from any person other than Tenant shall be deemed
a waiver of any provision of this Article 15 or the acceptance of any
Transferee hereunder, or a release of Tenant (or of any Transferee of
Tenant).  Notwithstanding anything to the contrary in this Lease, if
Tenant or any proposed Transferee claims that Landlord has unreasonably withheld
or delayed its consent under this Article 15 or otherwise has breached or
acted unreasonably under this Article 15, their sole remedies shall be a
declaratory judgment and an injunction for the relief and/or monetary damages,
and Tenant hereby waives all other remedies, including, without limitation, any
right at law or equity to terminate this Lease, on its own behalf and, to the
extent permitted under all applicable laws, on behalf of the proposed
Transferee.

       

      ARTICLE
16

       

      DAMAGE OR
DESTRUCTION

       

      Within
sixty (60) days after the date Landlord learns of the necessity for repairs as a
result of damage, Landlord shall notify Tenant ("Damage Repair
Estimate") of Landlord's reasonable estimated assessment of the period of
time in which the repairs will be completed.  If the Project is
damaged by fire or other insured casualty and the insurance proceeds have been
made available therefor by the holder or holders of any mortgages or deeds of
trust covering the Premises or the Project, the damage shall be diligently
repaired by Landlord to the extent such insurance proceeds are available
therefor and provided the Damage Repair Estimate indicates that repairs can be
completed within two hundred twenty (220) days after the necessity for repairs
as a result of such damage becomes known to Landlord, without the payment of
overtime or other premiums, and until such repairs are completed rent shall be
abated in proportion to the part of the Premises which is unusable by Tenant in
the conduct of its business (but there shall be no abatement of rent by reason
of any portion of the Premises being unusable for a period equal to one (1) day
or less).  However, if the damage is due to the fault or neglect of
Tenant, its 

       

      
        
           

        

        
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employees, agents, contractors, guests, invitees and the
like, there shall be no abatement of rent, unless and to the extent Landlord
receives rental income insurance proceeds.  Upon the occurrence of any
damage to the Premises, Tenant shall assign to Landlord (or to any party
designated by Landlord) all insurance proceeds payable to Tenant under
Section 14(a)(ii)(A) above, and if Landlord is required or elects to repair
such damage as required in this Article 16, Landlord shall use such insurance
proceeds assigned by Tenant for the repair and restoration of the Tenant
Improvements and Alterations; provided, however, that if the cost of repair of
improvements within the Premises by Landlord exceeds the amount of insurance
proceeds received by Landlord from Tenant's insurance carrier, as so assigned by
Tenant, such excess costs shall be paid by Tenant to Landlord if this Lease has
not been terminated due to such fire or casualty prior to Landlord's repair of
such damage.  If, however, the Damage Repair Estimate indicates that
repairs cannot be completed within two hundred twenty (220) days after the
necessity for repairs as a result of such damage becomes known to Landlord
without the payment of overtime or other premiums, Landlord may, at its option,
either (i) diligently make such repairs and in such event this Lease shall
continue in effect and the rent shall be abated, if at all, in the manner
provided in this Article 16, or (ii) elect not to effect such repairs
and instead terminate this Lease, by notifying Tenant in writing of such
termination within sixty (60) days after Landlord learns of the necessity for
repairs as a result of damage, such notice to include a termination date giving
Tenant sixty (60) days to vacate the Premises.  In addition, Landlord
may elect to terminate this Lease if the Project shall be damaged by fire or
other casualty or cause, whether or not the Premises are affected, if the damage
is not fully covered, except for deductible amounts, by Landlord's insurance
policies or would not have been so covered by Landlord’s insurance policies,
except for commercially reasonable deductible amounts, if Landlord had
maintained the insurance required of Landlord by this Lease.  However,
if Landlord does not elect to terminate this Lease pursuant to Landlord's
termination right as provided above, and the Damage Repair Estimate indicates
that repairs cannot be completed within two hundred twenty (220) days after
being commenced, Tenant may elect, not later than thirty (30) days after
Tenant's receipt of the Damage Repair Estimate, to terminate this Lease by
written notice to Landlord effective as of the date specified in Tenant's
notice.  Finally, if the Premises or the Project is damaged to any
substantial extent during the last twelve (12) months of the Term, then
notwithstanding anything contained in this Article 16 to the contrary,
Landlord shall have the option to terminate this Lease by giving written notice
to Tenant of the exercise of such option within sixty (60) days after Landlord
learns of the necessity for repairs as the result of such damage.  In
the event that the Premises or the Project is destroyed or damaged to any
substantial extent during the last twelve (12) months of the Term and if such
damage shall take longer than sixty (60) days to repair and if such damage is
not the result of the negligence or willful misconduct of Tenant or Tenant's
employees, licensees, invitees or agents, then notwithstanding anything in this
Article 16 to the contrary, Tenant shall have the option to terminate this Lease
by written notice to Landlord of the exercise of such option within sixty (60)
days after Tenant learns of the necessity for repairs as the result of such
damage.  A total destruction of the Project shall automatically
terminate this Lease.  Except as provided in this Article 16,
there shall be no abatement of rent and no liability of Landlord by reason of
any injury to or interference with Tenant's business or property arising from
such damage or destruction or the making of any repairs, alterations or
improvements in or to any portion of the Project or the Premises or in or to
fixtures, appurtenances and equipment therein.  Tenant understands
that Landlord will not carry insurance of any kind on Tenant's furniture,
furnishings, trade fixtures or equipment, and that Landlord shall not be
obligated to repair any damage thereto or replace the same.  Tenant
acknowledges that Tenant shall have no right to any proceeds of insurance
carried by Landlord relating to property damage.  With respect to any
damage which Landlord is obligated to repair or elects to repair, Tenant, as a
material inducement to Landlord entering into this Lease, irrevocably waives and
releases any rights under law to terminate this Lease.

       

      ARTICLE
17

       

      SUBORDINATION

       

      Landlord
represents and warrants that the Project is not currently, as of the date of
this Lease,  subject to any ground lease, mortgage or deed of
trust.  This Lease is subject and subordinate to all ground or
underlying leases, mortgages and deeds of trust which affect the property or the
Project, including all renewals, modifications, consolidations, replacements and
extensions thereof, subject, however, to Tenant’s right not to be disturbed so
long as no Event of 

       

      
        
           

        

        
          24

          
            
 

        

        
           

        

      

      
Default has occurred and is continuing; provided,
however, if the lessor under any such lease or the holder or holders of any such
mortgage or deed of trust shall advise Landlord that they desire or require this
Lease to be prior and superior thereto, upon written request of Landlord to
Tenant, Tenant agrees to promptly execute, acknowledge and deliver any and all
documents or instruments which Landlord or such lessor, holder or holders deem
necessary or desirable for purposes thereof.  Landlord shall have the
right to cause this Lease to be and become and remain subject and subordinate to
any and all ground or underlying leases, mortgages or deeds of trust which may
hereafter be executed covering the Premises, the Project or the property or any
renewals, modifications, consolidations, replacements or extensions thereof, for
the full amount of all advances made or to be made thereunder and without regard
to the time or character of such advances, together with interest thereon and
subject to all the terms and provisions thereof; provided, however, that as a
condition thereto Landlord obtains from the lender or other party in question a
written undertaking in favor of Tenant to the effect that such lender or other
party will not disturb Tenant's right of possession under this Lease so long as
no Event of Default has occurred and is continuing.  Tenant agrees,
within twenty (20) days after Landlord's written request therefor, to execute,
acknowledge and deliver upon request any and all documents or instruments
requested by Landlord or necessary or proper to assure the subordination of this
Lease to any such mortgages, deed of trust, or leasehold estates so long as it
contains lender's agreement not to disturb Tenant's right of possession under
this Lease so long as no Event of Default has occurred and is continuing
(hereinafter, an "SNDA").  Tenant
agrees that in the event any proceedings are brought for the foreclosure of any
mortgage or deed of trust or any deed in lieu thereof, to attorn to the
purchaser or any successors thereto upon any such foreclosure sale or deed in
lieu thereof as so requested to do so by such purchaser and to recognize such
purchaser as the lessor under this Lease, provided that as a condition thereto
such purchaser agrees in writing to assume Landlord’s obligations under this
Lease with respect to the security deposit and Letter of Credit and proceeds
thereof.  Tenant shall, subject to the same condition, within five (5)
business days after request execute such further instruments or assurances as
such purchaser may reasonably deem necessary to evidence or confirm such
attornment.  Tenant agrees to provide copies of any notices of
Landlord's default under this Lease to any mortgagee or deed of trust
beneficiary whose address has been provided to Tenant and Tenant shall provide
such mortgagee or deed of trust beneficiary a commercially reasonable time after
receipt of such notice within which to cure any such default; provided, however,
such lender cure period shall not delay Tenant's right under Section 9(a)
above to make repairs.  Tenant waives the provisions of any current or
future statute, rule or law which may give or purport to give Tenant any right
or election to terminate or otherwise adversely affect this Lease and the
obligations of the Tenant hereunder in the event of any foreclosure proceeding
or sale.

       

      ARTICLE
18

       

      EMINENT
DOMAIN

       

      If the
whole of the Premises or the Project or Development Common Areas or so much
thereof as to render the balance unusable by Tenant or to render Tenant’s use of
the Premises materially impaired shall be taken under power of eminent domain,
or is sold, transferred or conveyed in lieu thereof, this Lease shall
automatically terminate as of the date of such condemnation, or as of the date
possession is taken by the condemning authority, at Landlord's or Tenant's
option by notice to the other party.  Landlord shall give Tenant
prompt notice of any condemnation proceedings affecting the Project or any
Development Common Areas that materially affect Tenant's business
operations.  No award for any partial or entire taking shall be
apportioned, and Tenant hereby assigns to Landlord any award which may be made
in such taking or condemnation, together with any and all rights of Tenant now
or hereafter arising in or to the same or any part thereof; provided, however,
that nothing contained herein shall be deemed to give Landlord any interest in
or to require Tenant to assign to Landlord any award made to Tenant for moving
or relocation expenses, the taking, removal or reinstallation of personal
property and trade fixtures belonging to Tenant and removable by Tenant at the
expiration of the Term hereof as provided hereunder or for the interruption of,
or damage to, Tenant's business.  In the event of a partial taking
described in this Article 18, or a sale, transfer or conveyance in lieu
thereof, which does not result in a termination of this Lease, Tenant’s
Proportionate Share shall be appropriately adjusted and Basic Rental for any
portion of the Premises taken or condemned shall be abated during the unexpired
Term of this Lease according to the ratio that the part of the Premises
remaining useable by Tenant bears to the total area of the 

       

      
        
           

        

        
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Premises.  Except as expressly herein provided,
Tenant hereby waives any and all rights it might otherwise have under law to
terminate this Lease in the event of a taking under power of eminent
domain.

       

      ARTICLE
19

       

      DEFAULT

       

      Each of
the following acts or omissions of Tenant or of any guarantor of Tenant's
performance hereunder, or occurrences, shall constitute an "Event of
Default":

       

      (a) Failure or
refusal to pay Basic Rental, Additional Rent or any other amount to be paid by
Tenant to Landlord hereunder within three (3) business days after written notice
that the same is due or payable hereunder; said three (3) business day period
shall be in lieu of, and not in addition to, any statutory notice
requirements;

       

      (b) Except as
set forth in items (a) above and (c) through and including (f) below,
failure to perform or observe any other covenant or condition of this Lease to
be performed or observed within thirty (30) days following written notice to
Tenant of such failure or such additional period of time after such notice as is
reasonably required to effect such cure, not to exceed ninety (90) days from the
date of such notice, if the nature of the obligation is such that the cure
cannot reasonably be completed in such thirty (30) day period.  Such
thirty (30) day notice shall be in lieu of, and not in addition to, any
statutory notice requirements;

       

      (c) Abandonment
or failure (after the Commencement Date) to accept tender of possession of the
Premises or any significant portion thereof;

       

      (d) The filing
by Tenant or any guarantor hereunder in any court pursuant to any statute of a
petition in bankruptcy or insolvency or for reorganization or arrangement for
the appointment of a receiver of all or a portion of Tenant's property; the
filing against Tenant or any guarantor hereunder of any such petition, or the
commencement of a proceeding for the appointment of a trustee, receiver or
liquidator for Tenant, or for any guarantor hereunder, or of any of the property
of either, or a proceeding by any governmental authority for the dissolution or
liquidation of Tenant or any guarantor hereunder, if such proceeding shall not
be dismissed or trusteeship discontinued within sixty (60) days after
commencement of such proceeding or the appointment of such trustee or receiver;
or the making by Tenant or any guarantor hereunder of an assignment for the
benefit of creditors.  Tenant hereby stipulates to the lifting of the
automatic stay in effect and relief from such stay for Landlord in the event
Tenant files a petition under the United States Bankruptcy laws, for the purpose
of Landlord pursuing its rights and remedies against Tenant and/or a guarantor
of this Lease;

       

      (e) Tenant's
failure to cause to be released any mechanics liens filed against the Premises
or the Project arising from work contracted for or materials ordered by Tenant
within twenty (20) days after Landlord gives Tenant written notice that the same
has been filed or recorded; or

       

      (f) Tenant's
failure to observe or perform according to the provisions of Articles 7,
14, 17 or 25 within five (5) business days after notice from
Landlord.

       

      All
defaults by Tenant of any covenant or condition of this Lease shall be deemed by
the parties hereto to be material.

       

      ARTICLE
20

       

      REMEDIES

       

      (a) Upon the
occurrence of an Event of Default under this Lease as provided in
Article 19 hereof, Landlord may exercise all of its remedies as may be
permitted by law, including but not limited to terminating this Lease,
reentering the Premises and removing all persons and property therefrom, which
property may be stored by Landlord at a warehouse or elsewhere at the risk,
expense and for the account of Tenant.  If Landlord elects to
terminate this Lease, Landlord shall be entitled to recover from Tenant the
aggregate of all amounts permitted 

       

      
        
           

        

        
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by law, including but not limited to (i) the worth at the
time of award of the amount of any unpaid rent which had been earned at the time
of such termination; plus (ii) the worth at the time of award of the amount by
which the unpaid rent which would have been earned after termination until the
time of award exceeds the amount of such rental loss that Tenant proves could
have been reasonably avoided; plus (iii) the worth at the time of award of the
amount by which the unpaid rent for the balance of the Term after the time of
award exceeds the amount of such rental loss that Tenant proves could have been
reasonably avoided; plus (iv) any other amount necessary to compensate Landlord
for all the detriment proximately caused by Tenant's failure to perform its
obligations under this Lease or which in the ordinary course of things would be
likely to result therefrom, specifically including but not limited to, tenant
improvement expenses, brokerage commissions and advertising expenses incurred,
expenses of remodeling the Premises or any portion thereof for a new tenant,
whether for the same or a different use, and any special concessions made to
obtain a new tenant; and (v) at Landlord's election, such other amounts in
addition to or in lieu of the foregoing as may be permitted from time to time by
applicable law.  The term "rent" as used in this Section 20(a)
shall be deemed to be and to mean all sums of every nature required to be paid
by Tenant pursuant to the terms of this Lease, whether to Landlord or to
others.  As used in items (i) and (ii), above, the "worth at the time
of award" shall be computed by allowing interest at the rate set forth in item
(e), below, but in no case greater than the maximum amount of such interest
permitted by law.  As used in item (iii), above, the "worth at the
time of award" shall be computed by discounting such amount at the discount rate
of the Federal Reserve Bank of San Francisco at the time of award plus one
percent (1%).  Notwithstanding the above, if Landlord relets the
Premises for a term (the "Relet Term")
that extends past the Expiration Date of this Lease (without consideration of
any earlier termination pursuant to this Article 20), the costs of reletting
which may be included in Landlord’s damages under this Lease shall be limited to
a prorated portion of such costs, based on the percentage that the length of the
Term remaining on the date Landlord terminates this Lease bears to the length of
the Relet Term.  For example, if there are 2 years left on the Term at
the time that Landlord terminates this Lease and, prior to the expiration of the
2 year period, Landlord enters into a lease with a Relet Term of 10 years with a
new tenant, then only 20% of the costs of reletting shall be included when
determining Landlord's damages.

       

      (b) Nothing in
this Article 20 shall be deemed to affect Landlord's right to
indemnification for liability or liabilities arising prior to the termination of
this Lease for personal injuries or property damage under the indemnification
clause or clauses contained in this Lease.

       

      (c) Notwithstanding
anything to the contrary set forth herein, Landlord's re-entry to perform acts
of maintenance or preservation of or in connection with efforts to relet the
Premises or any portion thereof, or the appointment of a receiver upon
Landlord's initiative to protect Landlord's interest under this Lease shall not
terminate Tenant's right to possession of the Premises or any portion thereof
and, until Landlord does elect to terminate this Lease, this Lease shall
continue in full force and effect and Landlord may enforce all of Landlord's
rights and remedies hereunder.  Accordingly, if Landlord does not
elect to terminate this Lease on account of any default by Tenant, Landlord may,
from time to time, without terminating this Lease, enforce all of its rights and
remedies under this Lease, including the right to recover all rent as it becomes
due.

       

      (d) All
rights, powers and remedies of Landlord hereunder and under any other agreement
now or hereafter in force between Landlord and Tenant shall be cumulative and
not alternative and shall be in addition to all rights, powers and remedies
given to Landlord by law, and the exercise of one or more rights or remedies
shall not impair Landlord's right to exercise any other right or
remedy.

       

      (e) Any amount
due from Tenant to Landlord hereunder which is not paid when due shall bear
interest at the lower of eighteen percent (18%) per annum or the maximum lawful
rate of interest from the due date until paid, unless otherwise specifically
provided herein, but the payment of such interest shall not excuse or cure any
default by Tenant under this Lease.  In addition to such
interest:  (i) if Basic Rental is not paid on or before the fifth
(5th) day of
the calendar month for which the same is due, a late charge equal to five
percent (5%) of the amount overdue or $100, whichever is greater, shall be
immediately due and owing and shall accrue for each calendar month or part
thereof until such rental, including the late charge, is paid in full, which
late charge Tenant hereby agrees is a reasonable estimate of the damages
Landlord shall suffer as a result of Tenant's late payment and (ii) an
additional charge of $25 shall be assessed 

       

      
        
           

        

        
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for any check given to Landlord by or on behalf of Tenant
which is not honored by the drawee thereof; which damages include Landlord's
additional administrative and other costs associated with such late payment and
unsatisfied checks and the parties agree that it would be impracticable or
extremely difficult to fix Landlord's actual damage in such
event.  Notwithstanding the foregoing, Tenant shall be entitled to
notice and the expiration of a five (5) day cure period prior to a imposition of
any late charge or interest charge under this Section 20(e) one (1) time per
calendar year; after such written notice has been provided to Tenant in a
calendar year, Tenant shall not be entitled to any further notice prior to
imposition of a late charge or interest under this Section 20(e) in such
calendar year.  Such charges for interest and late payments and
unsatisfied checks are separate and cumulative and are in addition to and shall
not diminish or represent a substitute for any or all of Landlord's rights or
remedies under any other provision of this Lease.

       

      (f) Except as
otherwise provided in this Lease, in the event of any default, breach or
violation of Tenant's rights under this Lease by Landlord, Tenant's exclusive
remedies shall be an action for specific performance or action for actual
damages.  Without limiting any other waiver by Tenant which may be
contained in this Lease and without waiving any rights expressly granted to
Tenant under this Lease, Tenant hereby waives the benefit of any law granting it
the right to perform Landlord's obligation, or the right to terminate this Lease
on account of any Landlord default.  Notwithstanding anything in this
Lease to the contrary, (i) except as expressly provided in Article 5 above,
neither party shall be liable to the other, its contractors, agents or employees
or to any Landlord Parties for any indirect, consequential, special or punitive
damages or damages for loss of profits, and (ii) Landlord shall have the duty to
use commercially reasonable efforts to mitigate its damages if an Event of
Default occurs.

       

      ARTICLE
21

       

      TRANSFER OF
LANDLORD'S INTEREST

       

      In the
event of any transfer or termination of Landlord's interest in the Premises or
the Project by sale, assignment, transfer, foreclosure, deed-in-lieu of
foreclosure or otherwise whether voluntary or involuntary, Landlord shall be
automatically relieved of any and all obligations and liabilities on the part of
Landlord arising or accruing from and after the date of such transfer or
termination, including furthermore without limitation, the obligation of
Landlord under Article 4 above to return the security deposit, Letter of
Credit and proceeds thereof, provided the security deposit, Letter of Credit and
any Letter of Credit proceeds are transferred to said transferee and said
transferee assumes Landlord’s obligations under this Lease in writing, including
Landlord’s obligations with respect to the security deposit, Letter of Credit
and proceeds thereof.  Provided said transferee assumes Landlord’s
obligations under this Lease in writing, including Landlord’s obligations with
respect to the security deposit, Letter of Credit and proceeds thereof, (i)
Tenant agrees to attorn to the transferee upon any such transfer and to
recognize such transferee as the lessor under this Lease and (ii) Tenant shall,
within five (5) days after request, execute such further instruments or
assurances as such transferee may reasonably deem necessary to evidence or
confirm such attornment.

       

      ARTICLE
22

       

      BROKER

       

      In
connection with this Lease, Tenant warrants and represents that it has had
dealings only with firm(s) set forth in Article 1.G. of the Basic Lease
Provisions and that it knows of no other person or entity who is or might be
entitled to a commission, finder's fee or other like payment in connection
herewith and does hereby indemnify and agree to hold Landlord, its agents,
members, partners, representatives, officers, affiliates, shareholders,
employees, successors and assigns harmless from and against any and all loss,
liability and expenses that Landlord may incur should such warranty and
representation prove incorrect, inaccurate or false.  Landlord agrees
to pay the brokers identified in Article I.G. of the Basic Lease Provisions a
commission for this Lease in accordance with a separate agreement between
Landlord and such brokers.

       

      
        
           

        

        
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      ARTICLE
23

       

      PARKING

       

      During the
Term, Tenant and Tenant's employees and visitors shall be entitled to use,
commencing on the Commencement Date, the number of unreserved parking passes set
forth in Article 1.H. of the Basic Lease Provisions, which parking passes shall
pertain to the parking facility for the Development as currently shown on
Exhibit "F".  Landlord shall not grant a license or any other
contractual right to park on the parking facility for the Development during
normal business hours on business days to anyone other than tenants or other
occupants of the Development and their employees, visitors, guests, vendors and
invitees.  Tenant shall not be obligated to pay any parking fee to
Landlord during the initial Term, however Tenant shall be responsible for the
full amount of any taxes imposed by any governmental authority in connection
with the renting of such parking passes by Tenant or the use of the parking
facility by Tenant.  Tenant shall abide by all rules and regulations
which are prescribed from time to time for the orderly operation and use of the
parking facility where the parking passes are located, including any sticker or
other identification system established by Landlord, and cooperate to see that
Tenant's employees and visitors also comply with such rules and
regulations.  Landlord specifically reserves the right to change the
size, configuration, design, layout and all other aspects of the Development
parking facility at any time so long as such changes do not materially impair
Tenant’s access to the Premises or use of the parking lot on the Development or
reduce the number of parking passes which Tenant is entitled to have under this
Lease (except to the extent such changes are required by law), and Tenant
acknowledges and agrees that Landlord may, without incurring any liability to
Tenant and without any abatement of rent under this Lease, from time to time,
temporarily close-off or restrict access to the Project parking facility for
purposes of permitting or facilitating any such construction, alteration or
improvements.  Landlord may, from time to time, relocate any reserved
parking spaces (if any) rented by Tenant to another location in the Project
parking facility.  Landlord may delegate its responsibilities
hereunder to a parking operator or a lessee of the parking facility in which
case such parking operator or lessee shall have all the rights of control
attributed hereby to the Landlord.  The parking passes provided to
Tenant pursuant to this Article 23 are provided to Tenant solely for use by
Tenant's own personnel and visitors and such passes may not be transferred,
assigned, subleased or otherwise alienated by Tenant without Landlord's prior
approval, except that Tenant may transfer a prorata number of such parking
passes (based on relative square footage) in connection with an assignment or
sublease made by Tenant pursuant to Article 15 above.

       

      ARTICLE
24

       

      WAIVER

       

      No waiver
by a party of any provision of this Lease shall be deemed to be a waiver of any
other provision hereof or of any subsequent breach by the other party of the
same or any other provision.  No provision of this Lease may be waived
by Landlord or Tenant, except by an instrument in writing executed by such
waiving party.  Landlord's consent to or approval of any act by Tenant
requiring Landlord's consent or approval shall not be deemed to render
unnecessary the obtaining of Landlord's consent to or approval of any subsequent
act of Tenant, whether or not similar to the act so consented to or
approved.  No act or thing done by Landlord or Landlord's agents
during the Term of this Lease shall be deemed an acceptance of a surrender of
the Premises, and no agreement to accept such surrender shall be valid unless in
writing and signed by Landlord.  The subsequent acceptance of rent
hereunder by Landlord shall not be deemed to be a waiver of any preceding breach
by Tenant of any term, covenant or condition of this Lease, other than the
failure of Tenant to pay the particular rent so accepted, regardless of
Landlord's knowledge of such preceding breach at the time of acceptance of such
rent.  Any payment by Tenant or receipt by Landlord of an amount less
than the total amount then due hereunder shall be deemed to be in partial
payment only thereof and not a waiver of the balance due or an accord and
satisfaction, notwithstanding any statement or endorsement to the contrary on
any check or any other instrument delivered concurrently therewith or in
reference thereto.  Accordingly, Landlord may accept any such amount
and negotiate any such check without prejudice to Landlord's right to recover
all balances due and owing and to pursue its other rights against Tenant under
this Lease, regardless of whether Landlord makes any notation on such


       

      
        
           

        

        
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instrument of payment or otherwise notifies Tenant that
such acceptance or negotiation is without prejudice to Landlord's
rights.

       

      ARTICLE
25

       

      ESTOPPEL
CERTIFICATE

       

      Tenant
shall, at any time and from time to time, upon not less than twenty (20) days'
prior written notice from Landlord, execute, acknowledge and deliver to Landlord
a statement in writing certifying the following information, (but not limited to
the following information in the event further information is requested by
Landlord): (i) that this Lease is unmodified and in full force and effect (or,
if modified, stating the nature of such modification and certifying that this
Lease, as modified, is in full force and effect); (ii) the dates to which the
rental and other charges are paid in advance, if any; (iii) the amount of
Tenant's security deposit, if any; and (iv) acknowledging that there are not, to
Tenant's knowledge, any uncured defaults on the part of Landlord hereunder, and
to Tenant's knowledge, no events or conditions then in existence which, with the
passage of time or notice or both, would constitute a default on the part of
Landlord hereunder, or specifying such defaults, events or conditions, if any
are claimed.  It is expressly understood and agreed that any such
statement may be relied upon by any prospective purchaser or encumbrancer of all
or any portion of the Real Property.  Tenant's failure to deliver such
statement within such time shall constitute an admission by Tenant that all
statements contained therein are true and correct.

       

      ARTICLE
26

       

      LIABILITY OF
LANDLORD

       

      Notwithstanding
anything in this Lease to the contrary, any remedy of Tenant for the collection
of a judgment (or other judicial process) requiring the payment of money by
Landlord in the event of any default by Landlord hereunder or any claim, cause
of action or obligation, contractual, statutory or otherwise by Tenant against
Landlord or the Landlord Parties concerning, arising out of or relating to any
matter relating to this Lease and all of the covenants and conditions or any
obligations, contractual, statutory, or otherwise set forth herein, shall be
limited solely and exclusively to an amount which is equal to the sum of the
rents, issues and profits from the Development plus the lesser of (i) the
interest of Landlord in and to the Development, and (ii) the interest
Landlord would have in the Development if the Development were encumbered by
third party debt in an amount equal to eighty percent (80%) of the then current
value of the Development.  No other property or assets of Landlord or
any Landlord Party shall be subject to levy, execution or other enforcement
procedure for the satisfaction of Tenant's remedies under or with respect to
this Lease, Landlord's obligations to Tenant, whether contractual, statutory or
otherwise, the relationship of Landlord and Tenant hereunder, or Tenant's use or
occupancy of the Premises.

       

      ARTICLE
27

       

      INABILITY TO
PERFORM

       

      This Lease
and the obligations of both parties hereunder shall not be affected or impaired
because a party obligated to perform is unable to fulfill any of its obligations
hereunder or is delayed in doing so, to the extent such inability or delay is
caused by reason of any prevention, delay or stoppage due to strikes, lockouts,
acts of God, or any other cause previously, or at such time, beyond the
reasonable control or anticipation of such party (collectively, a "Force
Majeure") and the time for performance of such obligations under this
Lease shall be extended to the extent of the delay caused by any such Force
Majeure; provided, however, that this Article 27 is not intended to, and
shall not, extend the time period for the payment of any monetary amounts due
(including, without limitation, rent payments from Tenant) from either party to
the other under this Lease nor relieve either party from their monetary
obligations to the other under this Lease.

       

      
        
           

        

        
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      ARTICLE
28

       

      HAZARDOUS
WASTE

       

      (a) Except as
provided in Section 28(b) below, Tenant shall not cause or permit any
Hazardous Material (as defined in Section 28(d) below) to be brought, kept
or used in or about the Project by Tenant, its agents, employee, contractors, or
invitees.  Tenant indemnifies Landlord and the Landlord Parties from
and against any breach by Tenant of the obligations stated in the preceding
sentence and/or Tenant's use, storage, treatment or disposal of any Hazardous
Materials (pursuant to Section 28(b) below or otherwise), and Tenant agrees
to defend and hold Landlord and the Landlord Parties harmless from and against
any and all claims, judgments, damages, penalties, fines, costs, liabilities, or
losses (including, without limitation, diminution in value of the Project,
damages for the loss or restriction or use of rentable or usable space or of any
amenity of the Project, damages arising from any adverse impact or marketing of
space in the Project, and sums paid in settlement of claims, attorneys' fees and
costs, consultant fees, and expert fees) which arise during or after the Term of
this Lease as a result of such breach.  This indemnification of
Landlord and the Landlord Parties by Tenant includes, without limitation, costs
incurred in connection with any investigation of site conditions or any cleanup,
remedial, removal, or restoration work required by any federal, state, or local
governmental agency or political subdivision because of Hazardous Material
caused or permitted to be brought onto the Project by Tenant which is present in
the soil or ground water on or under the Project.  Without limiting
the foregoing, if the presence of any Hazardous Material on the Project caused
or permitted by Tenant results in any contamination of the Project, then subject
to the provisions of Articles 9, 10 and 11 hereof, Tenant shall promptly take
all actions at its sole expense as are necessary to return the Project to the
condition existing prior to the introduction of any such Hazardous Material and
the contractors to be used by Tenant for such work must be approved by Landlord,
which approval shall not be unreasonably withheld so long as such actions would
not potentially have any material adverse long-term or short-term effect on the
Project and so long as such actions do not materially interfere with the use and
enjoyment of the Project by the other tenants thereof; provided however,
Landlord shall also have the right, by written notice to Tenant, to directly
undertake any such mitigation efforts with regard to such Hazardous Materials in
or about the Project due to Tenant's breach of its obligations pursuant to this
Section 28(a), and to charge Tenant, as Additional Rent, for the costs
thereof.  Tenant's obligations under this Section 28(a) shall
survive the expiration or earlier termination of this Lease.

       

      (b) Landlord
acknowledges that it is not the intent of this Article 28 to prohibit Tenant
from operating its business for the Permitted Use as described in
Section 1(F) above.  Tenant may operate its business and use
Hazardous Material on the Premises according to the custom of the industry so
long as the use or presence of any Hazardous Material is strictly and properly
monitored and accomplished according to all applicable Environmental
Laws.  As a material inducement to Landlord to allow Tenant to use
Hazardous Materials in connection with its business, Tenant agrees to deliver to
Landlord prior to the Commencement Date a list identifying each type of
Hazardous Material to be present on the Premises and setting forth any and all
governmental approvals or permits required in connection with the presence of
any Hazardous Material on the Premises ("Hazardous Materials
List").  Tenant shall deliver to Landlord an updated Hazardous
Materials List at least once each calendar year and shall also deliver an
updated list before any new Hazardous Material is brought onto the Premises and
on or before the date Tenant obtains any additional permits or approvals for
Hazardous Materials.  An Event of Default shall be deemed to have
occurred (notwithstanding anything to the contrary contained herein) in the
event that (i) any use of the Premises by Tenant involves the generation,
storage, use, treatment or disposal of Hazardous Material in a manner or for a
purpose prohibited by any governmental agency or authority if Tenant fails to
cease such prohibited use of Hazardous Material in the Premises within three (3)
business days after notice to Tenant from Landlord to cease such use;
(ii) Tenant has been required by any lender or governmental authority to
take remedial action in connection with Hazardous Material contaminating the
Premises if the contamination resulted from Tenant's actions or use of the
Premises (unless Tenant is diligently seeking compliance with such remedial
action); or (iii) Tenant is subject to an enforcement order issued by any
governmental authority in connection with Tenant's use, disposal or storage of a
Hazardous Material on the Premises (unless Tenant is diligently seeking
compliance with such enforcement order).  At any time prior to the
expiration of the Lease Term and upon Landlord's reasonable belief that certain
Hazardous Materials tests are advisable, 

       

      
        
           

        

        
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Landlord shall have the right following notice (except in
the event of an emergency), to enter upon the Premises at all reasonable times
in order to conduct appropriate tests and to deliver to Tenant the results of
such tests to attempt to demonstrate that contamination has occurred as a result
of Tenant's use of the Premises.  Without limiting the foregoing
sentence, Landlord shall have the right to have an environmental audit of the
Premises to be conducted within ninety (90) days prior to the scheduled
expiration date of this Lease, or at termination of this Lease, if the Lease is
terminated on a date other than the scheduled termination
date.  Tenant shall promptly perform any remedial action recommended
by such environmental audit to remediate any Hazardous Material used, disposed
of or stored on the Premises by Tenant in excess of action levels or
governmental standards if the audit reveals that the Hazardous Materials
resulted from the activities of Tenant.  The costs of such audits
shall be borne by Landlord unless the audit discloses the existence of Hazardous
Materials in excess of action levels or governmental standards, that resulted
from the activities of Tenant, in which case the costs of the audit shall be
borne by Tenant.

       

      (c) It shall
not be unreasonable for Landlord to withhold its consent to any proposed
Transfer if (i) the proposed transferee's anticipated use of the Premises
involves the generation, storage, use, treatment, or disposal of Hazardous
Material (except as permitted as provided in Section 28(b) above); (ii) the
proposed Transferee has been required by any prior landlord, lender, or
governmental authority to take remedial action in connection with Hazardous
Material contaminating a property if the contamination resulted from such
Transferee's actions or use of the property in question; or (iii) the proposed
Transferee is subject to an enforcement order issued by any governmental
authority in connection with the use, disposal, or storage of a Hazardous
Material.  Landlord shall cause all Hazardous Material that is
required to be removed or remediated by applicable Environmental Laws and that
was caused or permitted to be brought onto the Development by Landlord or its
agents or any Landlord Parties, or that existed on the Development as of the
Commencement Date, or that is brought onto the Development after the
Commencement Date by anyone other than Tenant or its employees, agents or
contractors, to be promptly be removed and remediated from the Development at
Landlord's sole cost and without including such costs in Operating Costs (except
for the inclusion in Operating Costs as provided in the qualification to the
exclusion in subsection 3(c)(ii)(22)(ii) above).

       

      (d) As used
herein, the term "Hazardous
Material" means any hazardous or toxic substance, mate`rial, or waste
which is or becomes regulated by any local governmental authority, the State of
Washington or the United States Government.  The term "Hazardous
Material" includes, without limitation, any material or substance which is (i)
designated as a "Hazardous Substance" pursuant to Section 311 of the Federal
Water Pollution Control Act (33 U.S.C. § 1317), (ii) defined as a
"Hazardous Waste" pursuant to Section 1004 of the Federal Resource Conservation
and Recovery Act, 42 U.S.C. § 6901 et seq. (42 U.S.C. § 6903), or
(iii) defined as a "Hazardous Substance" pursuant to Section 101 of the
Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C.
§ 9601 et seq. (42 U.S.C. § 9601).

       

      (e) As used
herein, the term "Environmental
Laws" means any applicable Laws relating to any Hazardous Material
affecting the Project, including, without limitation, the laws, ordinances, and
regulations referred to in Section 28(d) above.

       

      ARTICLE
29

       

      SURRENDER OF
PREMISES; REMOVAL OF PROPERTY

       

      (a)           The
voluntary or other surrender of this Lease by Tenant to Landlord, or a mutual
termination hereof, shall not work a merger, and shall at the option of
Landlord, operate as an assignment to it of any or all subleases or subtenancies
affecting the Premises.

       

      (b)           Upon
the expiration of the Term of this Lease, or upon any earlier termination of
this Lease, Tenant shall quit and surrender possession of the Premises to
Landlord in good order and condition, reasonable wear and tear, fire and other
casualty damage resulting in termination of this Lease and repairs which are
Landlord's obligation excepted, and shall, without expense to Landlord, remove
or cause to be removed from the Premises all debris and rubbish, all furniture,
equipment, business and trade fixtures, free-standing cabinet work, moveable
partitioning, telephone and data cabling and other articles of personal property
in the Premises except to the 

       

      
        
           

        

        
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extent (i) Landlord elects by notice to Tenant to
exercise its option to have any subleases or subtenancies assigned to it, and/or
(ii) Landlord elects by notice to Tenant not to require Tenant to remove any
data cabling servicing the Premises.  Tenant shall be responsible for
the cost to repair all damage to the Premises resulting from the removal of any
of such items from the Premises, provided that Landlord shall have the right to
either (I) cause Tenant to perform said repair work, or (II) perform said repair
work itself, at Tenant's expense (with any such costs incurred by Landlord to be
reimbursed by Tenant to Landlord within three (3) business days following
written demand therefor from Landlord).

      

       

      (c)           Whenever
Landlord shall reenter the Premises as provided in Article 20 hereof, or as
otherwise provided in this Lease, any property of Tenant not removed by Tenant
upon the expiration of the Term of this Lease (or within forty-eight (48) hours
after a termination by reason of Tenant's default), as provided in this Lease,
shall be considered abandoned and Landlord may remove any or all of such items
and dispose of the same in any manner or store the same in a public warehouse or
elsewhere for the account and at the expense and risk of Tenant, and if Tenant
shall fail to pay the cost of storing any such property after it has been stored
for a period of thirty (30) days or more, Landlord may sell any or all of such
property at public or private sale, in such manner and at such times and places
as Landlord, in its sole discretion, may deem proper, without notice to or
demand upon Tenant, for the payment of all or any part of such charges or the
removal of any such property, and shall apply the proceeds of such sale as
follows:  first, to the cost and expense of such sale, including
reasonable attorneys' fees and costs for services rendered; second, to the
payment of the cost of or charges for storing any such property; third, to the
payment of any other sums of money which may then or thereafter be due to
Landlord from Tenant under any of the terms hereof; and fourth, the balance, if
any, to Tenant.

       

      (d)           Tenant
shall not be required to remove any improvements existing in the Premises prior
to the installation of the Improvements pursuant to the Tenant Work
Letter.  All fixtures, Tenant Improvements, Alterations and/or
appurtenances attached to or built into the Premises prior to or during the
Term, whether by Landlord or Tenant and whether at the expense of Landlord or
Tenant, or of both, shall be and remain part of the Premises and shall not be
removed by Tenant at the end of the Term unless otherwise expressly provided for
in Section 9(e) of this Lease above.  Such fixtures, Tenant
Improvements, Alterations and/or appurtenances shall include but not be limited
to:  all floor coverings, drapes, paneling, built-in cabinetry,
molding, doors, vaults (including vault doors), plumbing systems, security
systems electrical systems, lighting systems, communication systems, all
fixtures and outlets for the systems mentioned above and for all telephone,
radio and television purposes, and any special flooring or ceiling
installations.

       

      ARTICLE
30

       

      MISCELLANEOUS

       

      (a) SEVERABILITY;
ENTIRE AGREEMENT.  ANY PROVISION OF THIS LEASE WHICH SHALL
PROVE TO BE INVALID, VOID, OR ILLEGAL SHALL IN NO WAY AFFECT, IMPAIR OR
INVALIDATE ANY OTHER PROVISION HEREOF AND SUCH OTHER PROVISIONS SHALL REMAIN IN
FULL FORCE AND EFFECT.  THIS LEASE AND THE EXHIBITS ATTACHED HERETO
CONSTITUTE THE ENTIRE AGREEMENT BETWEEN THE PARTIES HERETO WITH REGARD TO
TENANT'S OCCUPANCY OR USE OF ALL OR ANY PORTION OF THE PROJECT, AND NO PRIOR
AGREEMENT OR UNDERSTANDING PERTAINING TO ANY SUCH MATTER SHALL BE EFFECTIVE FOR
ANY PURPOSE.  NO PROVISION OF THIS LEASE MAY BE AMENDED OR
SUPPLEMENTED EXCEPT BY AN AGREEMENT IN WRITING SIGNED BY THE PARTIES HERETO OR
THEIR SUCCESSOR IN INTEREST.  THE PARTIES AGREE THAT ANY DELETION OF
LANGUAGE FROM THIS LEASE PRIOR TO ITS MUTUAL EXECUTION BY LANDLORD AND TENANT
SHALL NOT BE CONSTRUED TO HAVE ANY PARTICULAR MEANING OR TO RAISE ANY
PRESUMPTION, CANON OF CONSTRUCTION OR IMPLICATION INCLUDING, WITHOUT LIMITATION,
ANY IMPLICATION THAT THE PARTIES INTENDED THEREBY TO STATE THE CONVERSE, OBVERSE
OR OPPOSITE OF THE DELETED LANGUAGE.

       

      
        
           

        

        
          33

          
            
 

        

        
           

        

      

       

      (b) Attorneys'
Fees; Waiver of Jury Trial.

       

      (i) In any
action to enforce the terms of this Lease, including any suit by Landlord for
the recovery of rent or possession of the Premises, the losing party shall pay
the successful party a reasonable sum for attorneys' fees and costs in such suit
and such attorneys' fees and costs shall be deemed to have accrued prior to the
commencement of such action and shall be paid whether or not such action is
prosecuted to judgment.  Tenant shall also reimburse Landlord for all
costs incurred by Landlord in connection with enforcing its rights under this
Lease against Tenant following a bankruptcy by Tenant, including, without
limitation, legal fees, experts' fees and expenses, court costs and consulting
fees.

       

      (ii) Should
Landlord, without fault on Landlord's part, be made a party to any litigation
instituted by Tenant or by any third party against Tenant, or by or against any
person holding under or using the Premises by license of Tenant, or for the
foreclosure of any lien for labor or material furnished to or for Tenant or any
such other person or otherwise arising out of or resulting from any act or
transaction of Tenant or of any such other person, Tenant covenants to save and
hold Landlord harmless from any judgment rendered against Landlord or the
Premises or any part thereof and from all costs and expenses, including
reasonable attorneys' fees and costs incurred by Landlord in connection with
such litigation.

       

      (iii) TO
THE EXTENT PERMITTED BY LAW, 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.

       

      (c) Time of
Essence.  Each of Tenant's covenants herein is a condition and
time is of the essence with respect to the performance of every provision of
this Lease.

       

      (d) Headings;
Joint and Several.  The article headings contained in this
Lease are for convenience only and do not in any way limit or amplify any term
or provision hereof.  The terms "Landlord" and "Tenant" as used herein
shall include the plural as well as the singular, the neuter shall include the
masculine and feminine genders and the obligations herein imposed upon Tenant
shall be joint and several as to each of the persons, firms or corporations of
which Tenant may be composed.

       

      (e) Reserved
Area.  Tenant hereby acknowledges and agrees that the exterior
walls of the Premises and the area (if any) between the finished ceiling of the
Premises and the slab of the floor of the Project thereabove have not been
demised hereby (are not part of the Premises) and the use thereof together with
the right to install, maintain, use, repair and replace pipes, ducts, conduits,
wiring and cabling leading through, under or above the Premises or throughout
the Project in locations which will not materially interfere with Tenant's use
of the Premises and serving other parts of the Project are hereby excepted and
reserved unto Landlord.  Landlord agrees that during the Term Tenant
shall have the nonexclusive right to use the area (if any) between the finished
ceiling of the Premises and the slab of the floor of the Project thereabove to
install, maintain, use, repair and replace any pipes, ducts, conduits, wiring
and cabling Tenant may wish to install to serve the Premises, provided Tenant
shall (i) comply with Landlord's reasonable requirements regarding such use
(e.g.,
labeling any wiring and cabling therein); and (ii) not materially interfere with
Landlord’s use of such area.

       

      (f) NO
OPTION.  THE SUBMISSION OF THIS LEASE BY LANDLORD, ITS AGENT OR
REPRESENTATIVE FOR EXAMINATION OR EXECUTION BY TENANT DOES NOT CONSTITUTE AN
OPTION OR OFFER TO LEASE THE PREMISES UPON THE TERMS AND CONDITIONS CONTAINED
HEREIN OR A RESERVATION OF THE PREMISES IN FAVOR OF TENANT, IT BEING INTENDED
HEREBY THAT THIS LEASE SHALL ONLY BECOME EFFECTIVE UPON THE EXECUTION HEREOF BY
LANDLORD AND TENANT AND DELIVERY OF A FULLY EXECUTED LEASE TO
TENANT.

       

      (g) Use of
Project Name; Improvements.  Tenant shall not be allowed to use
the name, picture or representation of the Project, or words to that effect, in
connection with any business carried on in the Premises or otherwise (except as
Tenant's address) without the prior written consent of Landlord.  In
the event that Landlord undertakes any additional improvements


       

      
        
           

        

        
          34

          
            
 

        

        
           

        

      

      
on the Real Property including but not limited to new
construction or renovation or additions to the existing improvements, Landlord
shall give Tenant reasonable notice prior to any such activity if such activity
may materially affect Tenant's business operations in the Premises and Landlord
shall use commercially reasonable efforts to conduct such activity in a
reasonable matter so as to minimize interference with Tenant's use of the
Premises; however, Landlord shall not be liable to Tenant for any noise, dust,
vibration or interference with access to the Premises or disruption in Tenant's
business caused thereby.

       

      (h) Rules and
Regulations.  Tenant shall observe faithfully and comply
strictly with the rules and regulations ("Rules and
Regulations") attached to this Lease as Exhibit "B" and made a part
hereof, and such other Rules and Regulations as Landlord may from time to time
reasonably adopt (and which are otherwise consistent with Tenant's rights under
this Lease) for the safety, care and cleanliness of the Project, the facilities
thereof, or the preservation of good order therein.  Landlord shall
not be liable to Tenant for violation of any such Rules and Regulations, or for
the breach of any covenant or condition in any lease by any other tenant in the
Project.  Landlord shall not enforce the Rules and Regulations in a
discriminatory manner.

       

      (i) Quiet
Possession.  Upon Tenant's paying the Basic Rental, Additional
Rent and other sums provided hereunder and observing and performing all of the
covenants, conditions and provisions on Tenant's part to be observed and
performed hereunder, Tenant shall have quiet possession of the Premises for the
entire Term hereof, subject to all of the provisions of this
Lease.

       

      (j) Rent.  All
payments required to be made hereunder to Landlord shall be deemed to be rent,
whether or not described as such.

       

      (k) Successors
and Assigns.  Subject to the provisions of Article 15
hereof, all of the covenants, conditions and provisions of this Lease shall be
binding upon and shall inure to the benefit of the parties hereto and their
respective heirs, personal representatives, successors and
assigns.

       

      (l) Notices.  Any
notice required or permitted to be given hereunder shall be in writing and may
be given by personal service evidenced by a signed receipt or sent by registered
or certified mail, return receipt requested, or via overnight courier, and shall
be effective upon proof of delivery, addressed to Tenant at 3625 – 132nd Avenue
S.E., Suite 400, Bellevue, Washington 98006 prior to the Commencement Date,
addressed to Tenant at the Premises from and after the Commencement Date, or to
Landlord at the management office for the Project, which currently is located at
10675 Willows Road NE, Suite 150, Redmond, WA 98052, with a copy to Landlord,
c/o Arden Realty, Inc., 11601 Wilshire Boulevard, Fourth Floor, Los Angeles,
California 90025, Attn:  Legal Department.  Either party may
by notice to the other specify a different address for notice purposes except
that, upon Tenant's taking possession of the Premises, the Premises shall
constitute Tenant's address for notice purposes.  A copy of all
notices to be given to Landlord hereunder shall be concurrently transmitted by
Tenant to such party hereafter designated by notice from Landlord to
Tenant.  Any notices sent by Landlord regarding or relating to
eviction procedures, including without limitation three day notices, may be sent
by regular mail.

       

      (m) Intentionally
Omitted.

       

      (n) Right of
Landlord to Perform.  All covenants and agreements to be
performed by Tenant under any of the terms of this Lease shall be performed by
Tenant at Tenant's sole cost and expense and without any abatement of
rent.  If Tenant shall fail to pay any sum of money, other than rent,
required to be paid by it hereunder or shall fail to perform any other act on
its part to be performed hereunder, and such failure shall continue beyond any
applicable cure period set forth in this Lease, Landlord may, but shall not be
obligated to, without waiving or releasing Tenant from any obligations of
Tenant, make any such payment or perform any such other act on Tenant's part to
be made or performed as is in this Lease provided.  All sums so paid
by Landlord and all reasonable incidental costs, together with interest thereon
at the rate of specified in Section 20(e) above from the date of such
payment by Landlord, shall be payable to Landlord on demand and Tenant covenants
to pay any such sums, and Landlord shall have (in addition to any other right or
remedy of Landlord) the same rights and remedies in the event of the nonpayment
thereof by Tenant as in the case of default by Tenant in the payment of the
rent.

       

      
        
           

        

        
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      (o) Access,
Changes in Project, Facilities, Name.

       

      (i) Every part
of the Project except the inside surfaces of all walls, windows and doors
bounding the Premises, (including exterior building walls, the rooftop, core
corridor walls and doors and any core corridor entrance), and any space in or
adjacent to the Premises or within the Project used for shafts, stacks, pipes,
conduits, fan rooms, ducts, electric or other utilities, sinks or other building
facilities, and the use thereof, as well as access thereto through the Premises
for the purposes of operation, maintenance, decoration and repair, are reserved
to Landlord.

       

      (ii) Landlord
reserves the right, without incurring any liability to Tenant therefor, to make
such changes in or to the Project and the fixtures and equipment thereof, as
well as in or to the street entrances, halls, passages, elevators, stairways and
other improvements thereof, as it may deem necessary or desirable, so long as no
such changes materially impair or interfere with Tenant’s ability to operate in
or have access to the Premises or use the parking area (except to the extent
such changes are required by law).  Landlord shall give Tenant
reasonable prior notice prior to any such activity which may materially affect
Tenant's operations and shall conduct such activity in a reasonable manner so as
to minimize interference with Tenant’s use of the Premises.

       

      (iii) Landlord
may adopt any name for the Project and Landlord reserves the right, from time to
time, to change the name and/or address of the Project; however, Landlord shall
give Tenant reasonable notice prior to changing the address of the Project and,
if such address change is initiated by Landlord (and not any governmental
authority), Landlord  shall reimburse Tenant for the cost of
stationery replacement necessitated by such change of address (not to exceed
$10,000.00).

       

      (p) Signing
Authority.  If Tenant is a corporation, partnership or limited
liability company, each individual executing this Lease on behalf of said entity
represents and warrants that he or she is duly authorized to execute and deliver
this Lease on behalf of said entity in accordance with: (i) if Tenant is a
corporation, a duly adopted resolution of the Board of Directors of said
corporation or in accordance with the By-laws of said corporation, (ii) if
Tenant is a partnership, the terms of the partnership agreement, and (iii) if
Tenant is a limited liability company, the terms of its operating
agreement.  Concurrently with Tenant's execution of this Lease, Tenant
shall provide to Landlord a copy of:  (A) if Tenant is a corporation,
such resolution of the Board of Directors authorizing the execution of this
Lease on behalf of such corporation, which copy of resolution shall be duly
certified by the secretary or an assistant secretary of the corporation to be a
true copy of a resolution duly adopted by the Board of Directors of said
corporation and shall be a form reasonably acceptable to Landlord, (B) if Tenant
is a partnership, a copy of the provisions of the partnership agreement granting
the requisite authority to each individual executing this Lease on behalf of
said partnership, and (C) if Tenant is a limited liability company, a copy of
the provisions of its operating agreement granting the requisite authority to
each individual executing this Lease on behalf of said limited liability
company.

       

      (q) Identification
of Tenant.

       

      (i) If Tenant
constitutes more than one person or entity, (A) each of them shall be jointly
and severally liable for the keeping, observing and performing of all of the
terms, covenants, conditions and provisions of this Lease to be kept, observed
and performed by Tenant, (B) the term "Tenant" as used in this Lease shall mean
and include each of them jointly and severally, and (C) the act of or notice
from, or notice or refund to, or the signature of, any one or more of them, with
respect to the tenancy of this Lease, including, but not limited to, any
renewal, extension, expiration, termination or modification of this Lease, shall
be binding upon each and all of the persons or entities executing this Lease as
Tenant with the same force and effect as if each and all of them had so acted or
so given or received such notice or refund or so signed.

       

      (ii) If Tenant
is a partnership (or is comprised of two or more persons, individually and as
co-partners of a partnership) or if Tenant's interest in this Lease shall be
assigned to a partnership (or to two or more persons, individually and as
co-partners of a partnership) pursuant to Article 15 hereof (any such
partnership and such persons hereinafter

       

      
        
           

        

        
          36

          
            
 

        

        
           

        

      

      
referred to in this Section 30(q)(ii) as "Partnership
Tenant"), the following provisions of this Lease shall apply to such
Partnership Tenant:

       

      (A) The
liability of each of the parties comprising Partnership Tenant shall be joint
and several.

       

      (B) Each of
the parties comprising Partnership Tenant hereby consents in advance to, and
agrees to be bound by, any written instrument which may hereafter be executed,
changing, modifying or discharging this Lease, in whole or in part, or
surrendering all or any part of the Premises to the Landlord, and by notices,
demands, requests or other communication which may hereafter be given, by the
individual or individuals authorized to execute this Lease on behalf of
Partnership Tenant under Subparagraph (p) above.

       

      (C) Any bills,
statements, notices, demands, requests or other communications given or rendered
to Partnership Tenant or to any of the parties comprising Partnership Tenant
shall be deemed given or rendered to Partnership Tenant and to all such parties
and shall be binding upon Partnership Tenant and all such
parties.

       

      (D) If
Partnership Tenant admits new partners, all of such new partners shall, by their
admission to Partnership Tenant, be deemed to have assumed performance of all of
the terms, covenants and conditions of this Lease on Tenant's part to be
observed and performed.

       

      (E) Partnership
Tenant shall give prompt notice to Landlord of the admission of any such new
partners, and, upon demand of Landlord, shall cause each such new partner to
execute and deliver to Landlord an agreement in form satisfactory to Landlord,
wherein each such new partner shall assume performance of all of the terms,
covenants and conditions of this Lease on Partnership Tenant's part to be
observed and performed (but neither Landlord's failure to request any such
agreement nor the failure of any such new partner to execute or deliver any such
agreement to Landlord shall terminate the provisions of clause (D) of this
Section 30(q)(ii) or relieve any such new partner of its obligations
thereunder).

       

      (r) Intentionally
Omitted.

       

      (s) Survival of
Obligations.  Any obligations of Tenant or Landlord occurring
prior to the expiration or earlier termination of this Lease shall survive such
expiration or earlier termination.

       

      (t) Intentionally
Omitted.

       

      (u) Governing
Law.  This Lease shall be governed by and construed in
accordance with the laws of the State of Washington.  No conflicts of
law rules of any state or country (including, without limitation, Washington
conflicts of law rules) shall be applied to result in the application of any
substantive or procedural laws of any state or country other than
Washington.  All controversies, claims, actions or causes of action
arising between the parties hereto and/or their respective successors and
assigns, shall be brought, heard and adjudicated by the courts of the State of
Washington, with venue in the County of King.  Each of the parties
hereto hereby consents to personal jurisdiction by the courts of the State of
Washington in connection with any such controversy, claim, action or cause of
action, and each of the parties hereto consents to service of process by any
means authorized by Washington law and consent to the enforcement of any
judgment so obtained in the courts of the State of Washington on the same terms
and conditions as if such controversy, claim, action or cause of action had been
originally heard and adjudicated to a final judgment in such
courts.  Each of the parties hereto further acknowledges that the laws
and courts of Washington were freely and voluntarily chosen to govern this Lease
and to adjudicate any claims or disputes hereunder.

       

      (v) Office of
Foreign Assets Control.  Tenant certifies to Landlord that
Tenant is not entering into this Lease, nor acting, for or on behalf of any
person or entity named as a terrorist or other banned or blocked person or
entity pursuant to any law, order, rule or regulation of the United States
Treasury Department or the Office of Foreign Assets Control.  Tenant
hereby agrees to indemnify, defend and hold Landlord and the Landlord Parties
harmless from any and all Claims arising from or related to any breach of the
foregoing certification.

       

      
        
           

        

        
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      (w) Financial
Statements.  Within ten (10) business days after Tenant's
receipt of Landlord's written request, Tenant shall provide Landlord with
current financial statements of Tenant and financial statements for the two (2)
calendar or fiscal years (if Tenant's fiscal year is other than a calendar year)
prior to the current financial statement year.  Any such statements
shall be prepared in accordance with generally accepted accounting principles
and, if the normal practice of Tenant, shall be audited by an independent
certified public accountant.

       

      (x) Exhibits.  The
Exhibits attached hereto are incorporated herein by this reference as if fully
set forth herein.

       

      (y) Independent
Covenants.  This Lease shall be construed as though the
covenants herein between Landlord and Tenant are independent (and not dependent)
and Tenant hereby expressly waives the benefit of any statute to the contrary
and agrees that if Landlord fails to perform its obligations set forth herein,
Tenant shall not, except as otherwise expressly provided in this Lease, be
entitled to make any repairs or perform any acts hereunder at Landlord's expense
or to set off of any of the rent or other amounts owing hereunder against
Landlord.

       

      (z) Counterparts.  This
Lease may be executed in counterparts, each of which shall be deemed an
original, but such counterparts, when taken together, shall constitute one
agreement.

       

      ARTICLE
31

       

      OPTION TO
EXTEND

       

      (a) Option
Right.  Landlord hereby grants the Tenant named in this Lease
(the "Original
Tenant") one (1) option ("Option") to
extend the Lease Term for the entire Premises for a period of five (5) years
("Option
Term"), which Option shall be exercisable only by written notice
delivered by Tenant to Landlord as set forth below.  The rights
contained in this Article 31 shall be personal to the Original Tenant and
any "Affiliated Assignee," as that term is defined below, and may only be
exercised by the Original Tenant or an Affiliated Assignee (and not any other
transferee) if the Original Tenant or such Affiliated Assignee occupies the
entire Premises as of the date of Tenant's Acceptance (as defined in
Section 31(c) below).  The term "Affiliate"
shall mean any entity that controls, is controlled by or is under common control
with Tenant (with the term "control"
meaning the ownership, directly or indirectly, of greater than fifty percent
(50%) of the voting securities of, or possession of the right to vote in the
ordinary direction of its affairs, of greater than fifty percent (50%) of the
voting interest in, an entity).  The term "Affiliated
Assignee" shall mean any assignee of Tenant's entire interest in this
Lease, where such assignee is an Affiliate.

       

      (b) Option
Rent.  The rent payable by Tenant during the Option Term
("Option
Rent") shall be equal to the "Market Rent" (defined
below).  "Market Rent"
shall mean the applicable Monthly Basic Rental, including all escalations,
Direct Costs, additional rent and other charges at which tenants, as of the
commencement of the Option Term, are entering into leases for non-sublease space
which is not encumbered by expansion rights and which is comparable in size,
location and quality to the Premises in renewal transactions for a term
comparable to the Option Term, which comparable space is located in buildings
comparable to the Project in Bothell, Washington, taking into consideration the
value of the existing improvements in the Premises to Tenant, as compared to the
value of the existing improvements in such comparable space, with such value to
be based upon the age, quality and layout of the improvements and the extent to
which the same could be utilized by Tenant with consideration given to the fact
that the improvements existing in the Premises are specifically suitable to
Tenant.

       

      (c) Exercise of
Options.  The Option shall be exercised by Tenant only in the
following manner:  (i) an Event of Default shall not have occurred and
be continuing, and an Event of Default shall not have occurred under this Lease
more than once in the preceding two (2) years, on the delivery date of the
Interest Notice and Tenant's Acceptance; (ii) Tenant shall deliver written
notice ("Interest
Notice") to Landlord not more than twelve (12) months nor less than nine
(9) months prior to the expiration of the Lease Term, stating that Tenant is
interested in exercising the Option, (iii) within fifteen (15) business days of
Landlord's receipt of Tenant's written notice, Landlord shall deliver notice
("Option Rent
Notice") to Tenant setting forth the Option Rent; and (iv) if Tenant
desires to exercise such Option, Tenant shall provide Landlord


       

      
        
           

        

        
          38

          
            
 

        

        
           

written notice within five (5) business days after
receipt of the Option Rent Notice ("Tenant's
Acceptance") and upon, and concurrent with such exercise, Tenant may, at
its option, object to the Option Rent contained in the Option Rent
Notice.  Tenant's failure to deliver the Interest Notice or Tenant's
Acceptance on or before the dates specified above shall be deemed to constitute
Tenant's election not to exercise the Option.  If Tenant timely and
properly exercises its Option, the Lease Term shall be extended for the Option
Term upon all of the terms and conditions set forth in this Lease, except that
the rent for the Option Term shall be as indicated in the Option Rent Notice
unless Tenant, concurrently with Tenant's Acceptance, objects to the Option Rent
contained in the Option Rent Notice, in which case the parties shall follow the
procedure and the Option Rent shall be determined, as set forth in
Section 31(d) below.

      

       

      (d) Determination
of Market Rent.  If Tenant timely and appropriately objects to
the Market Rent in Tenant's Acceptance, Landlord and Tenant shall attempt to
agree upon the Market Rent using their best good-faith efforts.  If
Landlord and Tenant fail to reach agreement within thirty (30) days following
Tenant's Acceptance ("Outside Agreement
Date"), then each party shall make a separate determination of the Market
Rent which shall be submitted to each other and to arbitration in accordance
with the following items (i) through (vii):

       

      (i) Landlord
and Tenant shall each appoint, within ten (10) days of the Outside Agreement
Date, one arbitrator who shall by profession be a current real estate broker or
appraiser of comparable commercial properties in the immediate vicinity of the
Project, and who has been active in such field over the last five (5)
years.  The determination of the arbitrators shall be limited solely
to the issue of whether Landlord's or Tenant's submitted Market Rent is the
closest to the actual Market Rent as determined by the arbitrators, taking into
account the requirements of item (b), above (i.e., the arbitrators may only
select Landlord's or Tenant's determination of Market Rent and shall not be
entitled to make a compromise determination).

       

      (ii) The two
(2) arbitrators so appointed shall within five (5) business days of the date of
the appointment of the last appointed arbitrator agree upon and appoint a third
arbitrator who shall be qualified under the same criteria set forth hereinabove
for qualification of the initial two arbitrators.

       

      (iii) The three
arbitrators shall within fifteen (15) days of the appointment of the third
arbitrator reach a decision as to whether the parties shall use Landlord's or
Tenant's submitted Market Rent, and shall notify Landlord and Tenant
thereof.

       

      (iv) The
decision of the majority of the three (3) arbitrators shall be binding upon
Landlord and Tenant.

       

      (v) If either
Landlord or Tenant fails to appoint an arbitrator within ten (10) days after the
applicable Outside Agreement Date, the arbitrator appointed by one of them shall
reach a decision, notify Landlord and Tenant thereof, and such arbitrator's
decision shall be binding upon Landlord and Tenant.

       

      (vi) If the two
(2) arbitrators fail to agree upon and appoint a third (3rd)
arbitrator, or both parties fail to appoint an arbitrator, then the appointment
of the third arbitrator or any arbitrator shall be dismissed and the matter to
be decided shall be forthwith submitted to arbitration under the provisions of
the American Arbitration Association, but subject to the instruction set forth
in this item (d).

       

      (vii) The cost
of arbitration shall be paid by Landlord and Tenant equally.

       

      ARTICLE
32

       

      RIGHT OF
FIRST OFFER

       

      Landlord
hereby grants to Tenant a right of first offer with respect to all space (other
than the Premises) on the first (1st) floor
of the Project ("First Offer
Space").  Notwithstanding the foregoing, (i) such first
offer right of Tenant shall commence only following the expiration or earlier
termination of (A) any existing lease pertaining to the First Offer Space,
and (B) as to any First Offer Space which is vacant as of the date of this
Lease, the first lease pertaining to any portion of such First Offer Space
entered into by Landlord after the date of this Lease 

       

      
        
           

        

        
          39

          
            
 

        

        
           

        

      

      
(collectively, the "Superior
Leases"), including any renewal or extension of such existing or future
lease, whether or not such renewal or extension is pursuant to an express
written provision in such lease, and regardless of whether any such renewal or
extension is consummated pursuant to a lease amendment or a new lease (the
rights described above to be known collectively as "Superior
Rights"), and (ii) such right of first offer shall not be triggered by
the lease of space in the Project by Landlord to an existing tenant in the
Project in connection with the relocation of such existing tenant's premises in
the Project.  Tenant's right of first offer shall be on the terms and
conditions set forth in this Article 32.

       

      (a) Procedure
for Offer.  Landlord shall notify Tenant (the "First Offer
Notice") from time to time when Landlord determines that Landlord shall
commence the marketing of any First Offer Space because such space shall become
available for lease to third parties, where no holder of a Superior Right
desires to lease such space.  The First Offer Notice shall describe
the space so offered to Tenant and shall set forth Landlord's proposed material
economic terms and conditions applicable to Tenant's lease of such space
(collectively, the "Economic
Terms"), including the proposed term of lease and the proposed rent
payable for the First Offer Space.  Notwithstanding the foregoing,
Landlord's obligation to deliver the First Offer Notice shall not apply during
the last nine (9) months of the initial Lease Term unless Tenant has delivered
an Interest Notice to Landlord pursuant to Section 31(c) above nor shall
Landlord be obligated to deliver the First Offer Notice during the last eight
(8) months of the initial Lease Term unless Tenant has timely delivered Tenant's
Acceptance to Landlord pursuant to Section 31(c) above.

       

      (b) Procedure
for Acceptance.  If Tenant wishes to exercise Tenant's right of
first offer with respect to the space described in the First Offer Notice, then
within five (5) business days after delivery of the First Offer Notice to
Tenant, Tenant shall deliver an unconditional irrevocable notice to Landlord of
Tenant's exercise of its right of first offer with respect to the entire space
described in the First Offer Notice, and the Economic Terms shall be as set
forth in the First Offer Notice.  If Tenant does not unconditionally
exercise its right of first offer within the five (5) business day period, then
Landlord shall be free to lease the space described in the First Offer Notice to
anyone to whom Landlord desires on any terms Landlord desires and Tenant's right
of first offer shall terminate as to the First Offer Space described in the
First Offer Notice.  Notwithstanding anything to the contrary
contained herein, Tenant must elect to exercise its right of first offer, if at
all, with respect to all of the space offered by Landlord to Tenant at any
particular time, and Tenant may not elect to lease only a portion
thereof.

       

      (c) Lease of
First Offer Space.  If Tenant timely and properly exercises
Tenant's right to lease the First Offer Space as set forth herein, Landlord and
Tenant shall execute an amendment adding such First Offer Space to this Lease
upon the same non-economic terms and conditions as applicable to the initial
Premises, and the Economic Terms provided in this
Article 32.  Unless otherwise specified in Landlord's Economic
Terms, Tenant shall commence payment of rent for the First Offer Space and the
Lease Term of the First Offer Space shall commence upon the date of delivery of
such space to Tenant.

       

      (d) No
Defaults.  The rights contained in this Article 32 shall
be personal to the Original Tenant and any Affiliated Assignee, and may only be
exercised by the Original Tenant or an Affiliated Assignee (and not any other
transferee) if the Original Tenant or such Affiliated Assignee occupies the
entire Premises as of the date of the First Offer Notice.  Tenant
shall not have the right to lease First Offer Space as provided in this
Article 32 if, as of the date of the First Offer Notice, or, at Landlord's
option, as of the scheduled date of delivery of such First Offer Space to
Tenant, an Event of Default has occurred and is continuing or an Event of
Default has occurred under this Lease more than once.

       

      (e) Remedy.  The
sole remedy of Tenant for a breach by Landlord of its obligations under this
Article 32 shall be an action against Landlord for a temporary restraining
order, preliminary injunction, injunction, specific performance and/or other
equitable remedy, and Tenant shall have no right to bring an action for damages
for such breach.

       

      
        
           

        

        
          40

          
            
 

        

        
           

        

      

       

      ARTICLE
33

       

      SIGNAGE

       

      Landlord
shall provide, at Landlord's sole cost and expense, Project-standard directory
and suite entry signage for the Premises.  In addition, subject to
this Article 33, Tenant shall be entitled to install, at its sole cost and
expense, non-exclusive signage on the exterior of the Project ("Signage").  The
graphics, materials, size, color, design, lettering, lighting (if any),
specifications and exact location of the Signage (collectively, the "Signage Specifications")
shall be subject to the prior written approval of Landlord, which approval may
be withheld in Landlord's sole discretion.  In addition, the Signage
and all Signage Specifications therefore shall be subject to Tenant's receipt of
all required governmental permits and approvals, shall be subject to all
applicable governmental laws and ordinances, and all covenants, conditions and
restrictions affecting the Project.  Tenant hereby acknowledges that,
notwithstanding Landlord's approval of the Signage and/or the Signage
Specifications therefor, Landlord has made no representations or warranty to
Tenant with respect to the probability of obtaining such approvals and
permits.  In the event Tenant does not receive the necessary permits
and approvals for the Signage, Tenant's and Landlord's rights and obligations
under the remaining provisions of this Lease shall not be
affected.  The cost of installation of the Signage, as well as all
costs of design and construction of such Signage and all other costs associated
with such Signage, including, without limitation, permits, maintenance and
repair, shall be the sole responsibility of Tenant.  Notwithstanding
anything to the contrary contained herein, in the event that at any time during
the Term of this Lease (or any Option Term, if applicable), Tenant fails to
occupy at the entire Premises, Tenant's right to the Signage shall thereupon
terminate and Tenant shall remove such Signage as provided in this
Section 33 below.  The rights to the Signage shall be personal to
the Original Tenant and may not be transferred, except that the Signage may be
transferred to an Affiliated Assignee provided that Landlord reasonably
determines that the name of the Affiliated Assignee is not an "Objectionable
Name," as that term is defined below.  The term "Objectionable
Name" shall mean any name that (i) relates to an entity that is of a
character or reputation, or is associated with a political orientation or
faction that is materially inconsistent with the quality of the Project, or
which would otherwise reasonably offend a landlord of a building comparable to
the Project, taking into consideration the level and visibility of Tenant's
Signage, or (ii) conflicts with any covenants in other leases of space in
the Development.  Should the Signage require maintenance or repairs as
determined in Landlord's reasonable judgment, Landlord shall have the right to
provide written notice thereof to Tenant and Tenant shall cause such repairs
and/or maintenance to be performed within thirty (30) days after receipt of such
notice from Landlord at Tenant's sole cost and expense.  Should Tenant
fail to perform such maintenance and repairs within the period described in the
immediately preceding sentence, Landlord shall have the right to cause such work
to be performed and to charge Tenant, as Additional Rent, for the cost of such
work.  Upon the expiration or earlier termination of this Lease (or
the termination of Tenant's Signage right as described above), Tenant shall, at
Tenant's sole cost and expense, cause the Signage to be removed from the
exterior of the Project and shall cause the exterior of the Project to be
restored to the condition existing prior to the placement of such
Signage.  If Tenant fails to remove such Signage and to restore the
exterior of the Project as provided in the immediately preceding sentence within
thirty (30) days following the expiration or earlier termination of this Lease,
then Landlord may perform such work, and all costs and expenses incurred by
Landlord in so performing such work shall be reimbursed by Tenant to Landlord
within ten (10) days after Tenant's receipt of invoice therefor.  The
immediately preceding sentence shall survive the expiration or earlier
termination of this Lease.

       

       

      [NO
FURTHER TEXT ON THIS PAGE]

       

      
        
           

        

        
          41

          
            
 

        

        
           

        

      

       

      IN WITNESS
WHEREOF, the parties have executed this Lease, consisting of the foregoing
provisions and Articles, including all exhibits and other attachments referenced
therein, as of the date first above written.

       

      
        	
                "LANDLORD"

              	 
      	
                ARDEN
      REALTY LIMITED PARTNERSHIP,

                a
      Maryland limited partnership

                 

                By:          ARDEN
      REALTY, INC.,

                a
      Maryland corporation

                Its:  Sole
      General Partner

                /s/
      Robert C. Peddicord

                By: Robert
      C.
      Peddicord                                                                

                Its:  Chief
      Operating
      Officer                                                           

              
	 
      
	
                "TENANT"

              	
                SCOLR
      PHARMA, INC.,

                a
      Delaware corporation

                 

                By:  /s/
      Daniel O.
      Wilds                                                                           

                Print
      Name: Daniel O.
      Wilds                                                                            

                Title: President
      &
      CEO                                                                            

                 

                By:                                                                             

                Print
      Name:                                                                             

                Title:                                                                             

              	 
      


      

       

      
        
           

        

        
          42

          
            
 

        

        
           

        

      

      
        	
                STATE
      OF Washington

                COUNTY OF King 

              	
                )

                )
      ss.

                )

              


      

       

      On June
20, 2008, before me, Sarah M. Schaeffer, a notary public, personally
appeared Daniel O. Wilds, personally known to me (or 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.

       

      WITNESS my
hand and official seal.

       

      Signature: /s/
Sarah M.
Schaeffer                                                                          [Seal]

      Print
Name: Sarah M.
Schaeffer                                                                          

       

       

       

       

       

      
        	
                STATE
      OF _________________

                COUNTY
      OF ________________

              	
                )

                )
      ss.

                )

              


      

       

      On
______________________, before me, ______________________, a notary public,
personally appeared ________________________________________, personally known
to me (or 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.

       

      WITNESS my
hand and official seal.

       

      Signature                                                                           (Seal)

       

      Print
Name:                                                                           

       

       

       

       

       

      
        	
                STATE
      OF _________________

                COUNTY
      OF ________________

              	
                )

                )
      ss.

                )

              


      

       

      On
______________________, before me, ______________________, a notary public,
personally appeared ________________________________________, personally known
to me (or 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.

       

      WITNESS my
hand and official seal.

       

      Signature                                                                           (Seal)

       

      Print
Name:                                                                           

       

      
        
           

        

        
          43

          
            
 

        

        
           

        

      

       

      CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT

       

      State of California 

        
          	
                  County
      of Los Angeles

                	
                  }

                


        

      

      On June 20, 2008, before me, Julieta Soracco, Notary
Public, personally appeared Robert C. Peddicord, 

      
        
          	
                  [Seal]

                	
                  who
      proved to me on the basis of satisfactory evidence to be the person whose
      name is subscribed to the within instrument and acknowledged to me that he
      executed the same in his authorized capacity; and that by his signature on
      the instrument the person or the entity upon behalf of which the person
      acted, executed the instrument.

                   

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

                   

                  WITNESS my hand and
      official seal.

                   

                  Signature /s/ Julieta
      Soracco

                                  
      Signature of Notary
Public

                


        



      
        
           

        

        
           

          
            
 

        

        
           

        

      

       

      EXHIBIT
A

       

       

      PREMISES

      

       

      This
Exhibit "A" is provided for informational purposes only and is intended to be
only an approximation of the layout of the Premises and shall not be deemed to
constitute any representation by Landlord as to the exact layout or
configuration of the Premises.

       

      
        
           

        

        
          
            Exhibit A;
1

          

          
            
 

        

        
           

        

      

       

      EXHIBIT
A-1

       

      LEGAL
DESCRIPTION OF PROPERTY

       

      Lots 32
and 33 of Quadrant Business Park – Bothell, as per plat recorded in Volume 131
of Plats, Pages 87 through 91, records of King County;

       

      Situated
in the City of Bothell, County of King, State of Washington

       

      
        
           

        

        
          Exhibit A-1; 1

          
            
 

        

        
           

        

      

       

      EXHIBIT
B

       

      RULES AND
REGULATIONS

       

      1. No sign,
advertisement or notice shall be displayed, printed or affixed on or to the
Premises or to the outside or inside of the Project or so as to be visible from
outside the Premises or Project without Landlord's prior written
consent.  Landlord shall have the right to remove any non-approved
sign, advertisement or notice, without notice to and at the expense of Tenant,
and Landlord shall not be liable in damages for such removal.  All
approved signs or lettering on doors and walls shall be printed, painted,
affixed or inscribed at the expense of Tenant by Landlord or by a person
selected by Landlord and in a manner and style acceptable to
Landlord.

       

      2. Tenant
shall not obtain for use on the Premises ice, waxing, cleaning, interior glass
polishing, rubbish removal, towel or other similar services, or accept barbering
or bootblackening, or coffee cart services, milk, soft drinks or other like
services on the Premises, except from persons authorized by Landlord and at the
hours and under regulations fixed by Landlord.  No vending machines
shall be installed, maintained or operated upon the Premises without Landlord's
prior written consent.

       

      3. The
sidewalks, halls, passages, exits, entrances, elevators and stairways shall not
be obstructed by Tenant or used for any purpose other than for ingress and
egress from Tenant's Premises; provided, however, that the loading dock and
receiving area serving the Premises may be temporarily obstructed as customary
and reasonable in connection with loading and unloading of
materials.  Under no circumstances is trash to be stored in the
corridors.  Notice must be given to Landlord for any large deliveries
that come through the building lobby of the Project; no such notice shall be
required with respect to deliveries through the loading dock and receiving area
of the Project.  Furniture, freight and other large or heavy articles,
and all other deliveries may be brought into the building lobby of the Project
only at times and in the manner designated by Landlord, and always at Tenant's
sole responsibility and risk.  Landlord may impose reasonable charges
for use of freight elevators after or before normal business
hours.  All damage done to the Project by moving or maintaining
furniture, freight or articles shall be repaired by Landlord at Tenant's
expense.  Tenant shall not take or permit to be taken in or out of
building lobby entrances or passenger elevators of the Project, any item
normally taken, or which Landlord otherwise reasonably requires to be taken, in
or out through service doors or on freight elevators.  Tenant shall
move all supplies, furniture and equipment brought into the building lobby as
soon as received directly to the Premises, and shall move all waste that is at
any time being taken from the Premises directly to the areas designated for
disposal.

       

      4. Toilet
rooms, toilets, urinals, wash bowls and other apparatus shall not be used for
any purpose other than for which they were constructed and no foreign substance
of any kind whatsoever shall be thrown therein.

       

      5. Tenant
shall not overload the floor of the Premises or mark, drive nails, screw or
drill into the partitions, ceilings or floor or in any way deface the
Premises.  Tenant shall not place typed, handwritten or computer
generated signs in the corridors or any other common areas.  Should
there be a need for signage additional to the Project standard tenant placard, a
written request shall be made to Landlord to obtain approval prior to any
installation.  All costs for said signage shall be Tenant's
responsibility.

       

      6. In no
event shall Tenant place a load upon any floor of the Premises or portion of any
such flooring exceeding the floor load per square foot of area for which such
floor is designed to carry and which is allowed by law, or any machinery or
equipment which shall cause excessive vibration to the Premises or noticeable
vibration to any other part of the Project.  Prior to bringing any
heavy safes, vaults, large computers or similarly heavy equipment into the
Project, Tenant shall inform Landlord in writing of the dimensions and weights
thereof and shall obtain Landlord's consent thereto.  Such consent
shall not constitute a representation or warranty by Landlord that the safe,
vault or other equipment complies, with regard to distribution of weight and/or
vibration, with the provisions of this Rule 6 nor relieve Tenant from
responsibility for the consequences of such noncompliance, and any such safe,
vault or other equipment which Landlord determines to constitute a danger of
damage to the Project or a nuisance to other tenants, either alone or in
combination with other heavy and/or vibrating objects and equipment,


       

      
        
           

        

        
          Exhibit B; 1

          
            
 

        

        
           

        

      

      
shall be promptly removed by Tenant, at Tenant's cost,
upon Landlord's written notice of such determination and demand for removal
thereof.

       

      7. Except as
provided in Article 28 of the Lease, Tenant shall not use or keep in the
Premises or Project any kerosene, gasoline or inflammable, explosive or
combustible fluid or material, or use any method of heating or air-conditioning
other than that supplied by Landlord.

       

      8. Tenant
shall not lay linoleum, tile, carpet or other similar floor covering so that the
same shall be affixed to the floor of the Premises in any manner except as
approved by Landlord.

       

      9. Tenant
shall not install or use any blinds, shades, awnings or screens in connection
with any window or door of the Premises and shall not use any drape or window
covering facing any exterior glass surface other than the standard drapes,
blinds or other window covering established by Landlord.

       

      10. Tenant
shall cooperate with Landlord in obtaining maximum effectiveness of the cooling
system by closing window coverings when the sun's rays fall directly on windows
of the Premises.  Tenant shall not obstruct, alter, or in any way
impair the efficient operation of Landlord's heating, ventilating and
air-conditioning system.  Tenant shall not tamper with or change the
setting of any thermostats or control valves.

       

      11. Tenant
shall not, without Landlord's prior written consent, occupy or permit any
portion of the Premises to be occupied or used for the manufacture or sale of
liquor or tobacco in any form, or a barber or manicure shop, or as an employment
bureau.  The Premises shall not be used for lodging or sleeping or for
any improper, objectionable or immoral purpose.  No auction shall be
conducted on the Premises.

       

      12. Tenant
shall not make, or permit to be made, any unseemly or disturbing noises, or
disturb or interfere with occupants of Project or neighboring buildings or
premises or those having business with it by the use of any musical instrument,
radio, phonographs or unusual noise, or in any other way.

       

      13. No
bicycles or vehicles (except in the warehouse area portion) or animals of any
kind (except for service animals) shall be brought into or kept in or about the
Premises, and no cooking shall be done or permitted by any tenant in the
Premises, except that lab-related heating/cooking in the lab area portion as may
be reasonable and appropriate for Pharmaceutical Development Uses or other
permitted lab-related uses and cooking for human consumption in the kitchen area
portion in the Premises and contained barbequing in the warehouse area portion
for Tenant and its employees and visitors shall be permitted and the preparation
of coffee, tea, hot chocolate and similar items outside the kitchen for tenants,
their employees and visitors shall also be permitted.  No tenant shall
cause or permit any unusual or objectionable odors to be produced in or permeate
from or throughout the Premises.  The foregoing notwithstanding,
Tenant shall have the right to use a microwave and to heat microwavable items
typically heated in an office.  Hot plates, toasters, toaster ovens or
similar open element cooking apparatus shall be permitted in the Premises so
long as used in compliance with applicable Laws and so long as such apparatuses
are UL approved, and subject to Article 28 of the Lease, freezers, cold
rooms, heating plates, flammable cabinets, flammable liquids, water baths, and
other heat generating or flame-based apparatuses reasonable and appropriate for
Pharmaceutical Development Uses or other permitted lab-related uses are
permitted in the lab portion of the Premises so long as such apparatuses are
used in compliance with applicable Laws.

       

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

       

      15. No
additional locks or bolts of any kind shall be placed upon any of the doors or
windows by any tenant, nor shall any changes be made in existing locks or the
mechanisms thereof unless Landlord is first notified thereof, gives written
approval, and is furnished a key therefor.  Each tenant must, upon the
termination of his tenancy, give to Landlord all keys and key cards of stores,
offices, or toilets or toilet rooms, either furnished to, or otherwise procured
by, such tenant, and in the event of the loss of any keys so furnished, such
tenant shall pay 

       

      
        
           

        

        
          Exhibit B; 2

          
            
 

        

        
           

        

      

      
Landlord the cost of replacing the same or of changing
the lock or locks opened by such lost key if Landlord shall deem it necessary to
make such change.  If more than two keys for one lock are desired,
Landlord will provide them upon payment therefor by Tenant.  Tenant
shall not key or re-key any locks.  All locks shall be keyed by
Landlord's locksmith only.

       

      16. Landlord
shall have the right to prohibit any advertising by any tenant which, in
Landlord's opinion, tends to impair the reputation of the Project and upon
written notice from Landlord any tenant shall refrain from and discontinue such
advertising.

       

      17. Landlord
reserves the right to control access to the Project by all persons after
reasonable hours of generally recognized business days and at all hours on
Sundays and legal holidays and may at all times control access to the equipment
areas of the Project outside the Premises; however, Tenant shall have access to
the Premises at all times in accordance with, and subject to, Article 7 of
the Lease.  Each tenant shall be responsible for all persons for whom
it requests after hours access and shall be liable to Landlord for all acts of
such persons.  Landlord shall have the right from time to time to
establish reasonable rules and charges pertaining to freight elevator usage,
including the allocation and reservation of such usage for tenants' initial
move-in to their premises, and final departure therefrom.  Landlord
may also establish from time to time reasonable rules and charges for accessing
the equipment areas of the Project, including the risers, rooftops and telephone
closets.

       

      18. Any person
employed by any tenant to do janitorial work shall, while in the Project and
outside of the Premises, be subject to and under the control and direction of
the Office of the Project or its designated representative such as security
personnel (but not as an agent or servant of Landlord, and the Tenant shall be
responsible for all acts of such persons).

       

      19. All doors
opening on to public corridors shall be kept closed, except when being used for
ingress and egress.  Tenant shall cooperate and comply with any
reasonable safety or security programs, including fire drills and air raid
drills, and the appointment of "fire wardens" developed by Landlord for the
Project, or required by law.  Before leaving the Premises unattended,
Tenant shall close and securely lock all doors or other means of entry to the
Premises and shut off all lights and water faucets in the
Premises.

       

      20. The
requirements of tenants will be attended to only upon application to the Office
of the Project.

       

      21. Canvassing,
soliciting and peddling in the Project are prohibited and each tenant shall
cooperate to prevent the same.

       

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

       

      23. No
air-conditioning unit or other similar apparatus shall be installed or used by
any tenant without the prior written consent of Landlord.

       

      24. There
shall not be used in any space, or in the public halls of the Project, either by
any tenant or others, any hand trucks except those equipped with rubber tires
and side guards.

       

      25. All
electrical ceiling fixtures hung in offices or spaces along the perimeter of the
Project must be fluorescent and/or of a quality, type, design and bulb color
approved by Landlord.  Tenant shall not permit the consumption in the
Premises of more than 21⁄2 watts per net usable square foot in the Premises in
respect of office lighting nor shall Tenant permit the consumption in the
Premises of more than 11⁄2 watts per net usable square foot of space in the
Premises in respect of the power outlets therein, at any one time.  In
the event that such limits are exceeded, Landlord shall have the right to
require Tenant to remove lighting fixtures and equipment and/or to charge Tenant
for the cost of the additional electricity consumed.

       

      26. Parking.

       

      (a) Automobiles
must be parked entirely within the stall lines on the floor.

       

      (b) All
directional signs and arrows must be observed.

       

      
        
           

        

        
          Exhibit B; 3

          
            
 

        

        
           

        

      

       

      (c) The speed
limit shall be 5 miles per hour.

       

      (d) Parking is
prohibited in areas not striped for parking.

       

      (e) Parking
cards or any other device or form of identification supplied by Landlord (or its
operator) shall remain the property of Landlord (or its
operator).  Such parking identification device must be displayed as
requested and may not be mutilated in any manner.  The serial number
of the parking identification device may not be obliterated.  Devices
are not transferable or assignable and any device in the possession of an
unauthorized holder will be void.  There will be a replacement charge
to the Tenant or person designated by Tenant of $25.00 for loss of any parking
card.  There shall be a security deposit of $25.00 due at issuance for
each card key issued to Tenant.

       

      (f) Landlord
(and its operator) may refuse to permit any person who violates the within rules
to park in the Project parking facility, and any violation of the rules shall
subject the automobile to removal from the Project parking facility at the
parker's expense.  In either of said events, Landlord (or its
operator) shall refund a pro rata portion of the current monthly parking rate
and the sticker or any other form of identification supplied by Landlord (or its
operator) will be returned to Landlord (or its operator).

       

      (g) Project
parking facility managers or attendants are not authorized to make or allow any
exceptions to these Rules and Regulations.

       

      (h) All
responsibility for any loss or damage to automobiles or any personal property
therein is assumed by the parker.

       

      (i) Loss or
theft of parking identification devices from automobiles must be reported to the
Project parking facility manager immediately, and a lost or stolen report must
be filed by the parker at that time.

       

      (j) The
parking facilities are for the sole purpose of parking one automobile per
space.  Washing, waxing, cleaning or servicing of any vehicles by the
parker or his agents is prohibited.

       

      (k) Landlord
(and its operator) reserves the right to refuse the issuance of monthly stickers
or other parking identification devices to any Tenant and/or its employees who
refuse to comply with the above Rules and Regulations and all City, State or
Federal ordinances, laws or agreements.

       

      (l) Tenant
agrees to acquaint all employees with these Rules and
Regulations.

       

      (m) No vehicle
shall be stored in the Project parking facility for a period of more than one
(1) week.

       

      27. The
Project is a non-smoking Project.  Smoking or carrying lighted cigars
or cigarettes in the Premises or the Project, including the elevators in the
Project (if any), is prohibited.

       

      28. Tenant
shall not, without Landlord's prior written consent (which consent may be
granted or withheld in Landlord's absolute discretion), allow any employee or
agent to carry any type of gun or other firearm in or about any of the Premises
or Project.

       

      
        
           

        

        
          Exhibit B; 4

          
            
 

        

        
           

        

      

       

      EXHIBIT
C

       

      NOTICE
OF LEASE TERM DATES

      AND TENANT'S
PROPORTIONATE SHARE

       

      TO:           DATE:                                                      

      
 

      
 

       

      
        	
                RE:

              	
                Lease
      dated ________________, 200_, between

              	
                ("Landlord"),
      and

              	
                ("Tenant"),
      concerning Suite ________, located at
      __________________________________________.

              


      

       

      Ladies and
Gentlemen:

       

      In
accordance with the Lease, Landlord wishes to advise and/or confirm the
following:

       

      1. That the
Premises have been accepted herewith by the Tenant as being substantially
complete in accordance with the Lease and that there is no deficiency in
construction of which Tenant is aware, except as
follows:  _____________________________..

       

      2. That the
Tenant has taken possession of the Premises and acknowledges that under the
provisions of the Lease the Term of said Lease shall commence as of ____________
for a term of ________________________ ending on
________________________.

       

      3. That in
accordance with the Lease, Basic Rental commenced to accrue on
________________________, subject to Tenant's right to abated rent as provided
in the Lease.

       

      4. If the
Commencement Date of the Lease is other than the first day of the month, the
first billing will contain a prorata adjustment.  Each billing
thereafter shall be for the full amount of the monthly installment as provided
for in said Lease.

       

      5. Rent is
due and payable in advance on the first day of each and every month during the
Term of said Lease, subject to Tenant's right to abated rent as provided in the
Lease.  Your rent checks should be made payable to
________________________ at
________________________________________________.

       

      6. The exact
number of rentable square feet within the Premises is 20,468 rentable square
feet, allocated as follows:  9,360 rentable square feet in the Office
Portion of the Premises, 8,939 rentable square feet in Lab Portion of the
Premises and 2,169 rentable square feet in the Warehouse Portion of the
Premises.

       

      7. Tenant's
Proportionate Share, as adjusted based upon the exact number of rentable square
feet within the Premises is 41.67%.

       

      AGREED AND
ACCEPTED:

       

      TENANT:

                                                                            
,

      a                                                                    
.

      By:           

      Its:                                                      

       

      
        
           

        

        
          Exhibit C; 1

          
            
 

        

        
           

        

      

       

      EXHIBIT
D

       

      TENANT WORK
LETTER

       

      [SCOLR
Pharma, Inc.]

       

      This
Tenant Work Letter shall set forth the terms and conditions relating to the
renovation of the tenant improvements in the Premises.  This Tenant
Work Letter is essentially organized chronologically and addresses the issues of
the renovation of the Premises, in sequence, as such issues will
arise.

       

      SECTION
1

       

      LANDLORD'S
INITIAL CONSTRUCTION IN THE PREMISES

       

      Landlord
has constructed, at its sole cost and expense, the base, shell and core (i) of
the Premises, and (ii) of the floor of the Project on which the Premises is
located  (collectively, the "Base, Shell and
Core").  Subject to Landlord's obligations as provided in this
Lease, Tenant has inspected and hereby approves the condition of the Premises
and the Base, Shell and Core, and agrees that, subject to construction of the
Improvements,  the Premises and Base, Shell and Core shall be
delivered to Tenant in its current "as-is" condition.  The
improvements to be initially installed in the Premises shall be designed and
constructed pursuant to this Tenant Work Letter.  Any costs of initial
design and construction of any improvements to the Premises shall be an
"Improvement Allowance Item", as that term is defined in Section 2.2 of
this Tenant Work Letter.

       

      SECTION
2

       

      IMPROVEMENTS

       

      2.1. Improvement
Allowance.  Tenant shall be entitled to a one-time space
planning allowance ("Space Planning
Allowance") in the amount of $3,070.20 (based on $.15 per rentable square
foot of the Premises) for the costs related to Tenant's space planning for the
Premises.  In addition, Tenant shall be entitled to a one-time
improvement allowance (the "Improvement
Allowance") in the amount of $450,296.00 (based on $22.00 per rentable
square foot of the Premises) for the costs relating to the initial design and
construction of Tenant's improvements which are permanently affixed to the
Premises (the "Improvements").  In
no event shall Landlord be obligated to make disbursements pursuant to this
Tenant Work Letter in a total amount which exceeds the Space Planning Allowance
and Improvement Allowance and in no event shall Tenant be entitled to any credit
for any unused portion of the Improvement Allowance not used by Tenant by the
earlier of (i) the date Tenant gives Landlord written notice that it will not
seek to obtain any credit for any unused portion of the Improvement Allowance or
(ii) March 31, 2009.

       

      2.2. Disbursement
of the Improvement Allowance.  The Space Planning Allowance
shall be paid by Landlord within thirty (30) days after invoicing by Tenant's
Architect.  Except as otherwise set forth in this Tenant Work Letter,
the Improvement Allowance shall be disbursed by Landlord (each of which
disbursements shall be made pursuant to Landlord's disbursement process) for
costs related to the construction of the Improvements and for the following
items and costs (collectively, the "Improvement Allowance
Items"): (i) payment of the commercially reasonable fees of the
"Architect" and the "Engineers," as those terms are defined in Section 3.1
of this Tenant Work Letter, and payment of the commercially reasonable fees
incurred by, and the commercially reasonable cost of documents and materials
supplied by, Landlord and Landlord's consultants in connection with the
preparation and review of the "Construction Drawings," as that term is defined
in Section 3.1 of this Tenant Work Letter (including fees for a preliminary
analysis and fit plan); (ii) the cost of permits; (iii) the cost of
any changes in the Base, Shell and Core required by the Construction Drawings;
(iv) the cost of any changes to the Construction Drawings or Improvements
required by applicable building codes (the "Code");
(v) Washington State Sales Tax; and (vi) the "Landlord Coordination
Fee", as that term is defined in Section 4.3.2 of this Tenant Work
Letter.  However, in no event shall more than Three


       

      
        
           

        

        
          Exhibit D; 1

          
            
 

        

        
           

        

      

      
and 50/100 Dollars ($3.50) per rentable square foot of
the Improvement Allowance be used for the aggregate cost of items described in
(i) and (ii) above; any additional amount incurred as a result of (i) and (ii)
above shall be paid for by Tenant as part of the Over-Allowance
Amount.

       

      2.3. Standard
Improvement Package.  Landlord has established specifications
(the "Specifications")
for the Project standard components to be used in the construction of the
Improvements in the Premises (collectively, the "Standard Improvement
Package"), which Specifications are available upon
request.  The quality of Improvements shall be equal to or, at
Tenant's election in its sole discretion, of greater quality than, the quality
of the Specifications, provided that Landlord may, at Landlord's option, require
the Improvements to comply with certain Specifications.

       

      SECTION
3

       

      CONSTRUCTION
DRAWINGS

       

      3.1. Selection of
Architect/Construction Drawings.  Tenant shall retain an
architect/space planner acceptable to Landlord and Tenant (the "Architect") to
prepare the "Construction Drawings," as that term is defined in this
Section 3.1.  Tenant shall also retain the engineering
consultants designated by Landlord subject to Tenant's reasonable approval (the
"Engineers") to
prepare all plans and engineering working drawings relating to the structural,
mechanical, electrical, plumbing, HVAC and life safety work of the
Improvements.  The plans and drawings to be prepared by Architect and
the Engineers hereunder for the Improvements shall be known collectively as the
"Construction
Drawings."  All Construction Drawings shall comply with the
drawing format and specifications as reasonably determined by Landlord, and
shall be subject to Landlord's reasonable approval.  Tenant and
Architect shall verify, in the field, the dimensions and conditions as shown on
the relevant portions of the base building plans, and Tenant and Architect shall
be solely responsible for the same, and Landlord shall have no responsibility in
connection therewith.  Landlord's review of the Construction Drawings
as set forth in this Section 3, shall be for its sole purpose and shall not
imply Landlord's review of the same, or obligate Landlord to review the same,
for quality, design, Code compliance or other like
matters.  Accordingly, notwithstanding that any Construction Drawings
are reviewed by Landlord or its space planner, architect, engineers and
consultants, and notwithstanding any advice or assistance which may be rendered
to Tenant by Landlord or Landlord's space planner, architect, engineers, and
consultants, Landlord shall have no liability whatsoever in connection therewith
and shall not be responsible for any omissions or errors contained in the
Construction Drawings.

       

      With
respect to any approval required of Landlord under this Tenant Work Letter, (i)
Landlord's approval shall not be unreasonably withheld, conditioned or delayed,
(ii) Landlord shall review and respond to such request promptly, and (iii) such
approval shall be deemed given unless within five (5) business days after
written request for approval is made, Landlord gives Tenant written notice of
the specific reasons for disapproval and suggestions for alternatives that would
be acceptable to Landlord.  Landlord and Tenant shall cooperate in
good faith in connection with their obligations under this Tenant Work
Letter.  Landlord shall use reasonable efforts to cause Substantial
Completion of the Improvements to occur by the anticipated date specified in
Section 1(A) of this Lease or as soon thereafter as reasonably
possible.

       

      3.2. Final Space
Plan.  On or before the date set forth in Schedule 1,
attached hereto, Tenant and the Architect shall prepare the final space plan for
Improvements in the Premises (collectively, the "Final Space
Plan"), which Final Space Plan shall include a layout and designation of
all offices, rooms and other partitioning, their intended use, and equipment to
be contained therein, and shall deliver the Final Space Plan to Landlord for
Landlord's approval.

       

      3.3. Final
Working Drawings.  On or before the date set forth in Schedule
1, Tenant, the Architect and the Engineers shall complete the architectural and
engineering drawings for the Premises, and the final architectural working
drawings in a form which is complete to allow subcontractors to bid on the work
and to obtain all applicable permits (collectively, the "Final Working
Drawings") and shall submit the same to Landlord for Landlord's
approval.

       

      3.4. Permits.  The
Final Working Drawings shall be approved by Landlord (the "Approved Working
Drawings") prior to the commencement of the construction of the


       

      
        
           

        

        
          Exhibit D; 2

          
            
 

        

        
           

        

      

      
Improvements.  Tenant shall cause the Architect
to immediately submit the Approved Working Drawings to the appropriate municipal
authorities for all applicable building permits necessary to allow "Contractor,"
as that term is defined in Section 4.1, below, to commence and fully
complete the construction of the Improvements (the "Permits").  No
changes, modifications or alterations in the Approved Working Drawings may be
made without the prior written consent of Landlord, which consent shall not be
unreasonably withheld, conditioned or delayed.

       

      3.5. Time
Deadlines.  Tenant shall use its best efforts and all due
diligence to cooperate with the Architect, the Engineers, and Landlord to
complete all phases of the Construction Drawings and the permitting process and
to receive the permits, and with Contractor for approval of the "Cost Proposal,"
as that term is defined in Section 4.2 of this Tenant Work Letter, as soon
as possible after the execution of the Lease, and, in that regard, shall meet
with Landlord on a scheduled basis to be determined by jointly by Landlord and
Tenant, to discuss Tenant's progress in connection with the same.  The
applicable dates for approval of items, plans and drawings as described in this
Section 3, Section 4 below, and in this Tenant Work Letter are set
forth and further elaborated upon in Schedule 1 (the "Time
Deadlines"), attached hereto.  Tenant and Landlord each agree
to comply with the Time Deadlines.

       

      SECTION
4

       

      CONSTRUCTION
OF THE IMPROVEMENTS

       

      4.1. Contractor.  The
contractor which shall construct the Improvements shall be a contractor selected
pursuant to the following procedure.  Promptly after Landlord's
approval of the Final Working Drawings, Landlord shall submit them to three (3)
general contractors selected by Landlord.  Each such contractor shall
be invited to submit a sealed, fixed price contract bid (on such bid form as
Landlord shall designate) to construct the Improvements.  Each
contractor shall be notified in the bid package of the time schedule for
construction of the Improvements.  The subcontractors utilized by the
Contractor shall be subject to Landlord's reasonable approval and the bidding
instructions shall provide that as to work affecting the structure of the
Project and/or the systems and equipment of the Project, Landlord shall be
entitled to designate the subcontractors.  The bids shall be submitted
promptly to Landlord and a reconciliation shall be performed by Landlord to
adjust inconsistent or incorrect assumptions so that a like-kind comparison can
be made and a low bidder determined.  Landlord shall provide Tenant
with copies of the bids and Landlord's reconciliation.  Landlord shall
select the contractor who shall be the lowest bidder and who states that it will
be able to meet Landlord's construction schedule, unless Tenant notifies
Landlord within three (3) business days after Tenant's receipt of the bids and
reconciliation that Tenant desires that one of the other two (2) contractors
perform the work, in which event Landlord will select the contractor designated
by Tenant so long as such contractor's bid states that it will be able to meet
Landlord's construction schedule.  The contractor selected may be
referred to herein as the "Contractor".  The
construction contract with the Contractor shall (i) contain industry
standard warranties and guaranties, (ii) provide for an obligation of the
Contractor to construct the Improvement pursuant to the Approved Working
Drawings, (iii) require the Contractor to construct the Improvements in a
good and workmanlike manner, (iv) contain an obligation to complete
construction of the Improvements not later than October 1, 2008 (subject to
Force Majeure), and (v) require the Contractor, at Landlord's request, to focus
and accelerate construction for certain portions of the Premises should
construction be delayed as contemplated by Section 2(a) of the
Lease.

       

      4.2. Cost
Proposal.  After the Approved Working Drawings are signed by
Landlord and Tenant, Landlord shall provide Tenant with a cost proposal in
accordance with the Approved Working Drawings, which cost proposal shall
include, as nearly as possible, the cost of all Improvement Allowance Items to
be incurred by Tenant in connection with the construction of the Improvements
(the "Cost
Proposal").Tenant shall either (i) approve and deliver the Cost
Proposal to Landlord within three (3) business days of the receipt of the same,
or (ii) notify Landlord within three (3) business days after Tenant's
receipt of the Cost Proposal that Tenant will instruct the Architect to revise
the Approved Working Drawings to change the amount of the Cost Proposal, in
which case such changes shall be made to the Approved Working Drawings only in
accordance with Section 3.3 above and the revised Final Working Drawings
shall be provided to the Contractor for repricing whereupon Landlord shall
revise the Cost Proposal for Tenant's approval.  This procedure shall
be repeated until the Cost Proposal is approved by 

       

      
        
           

        

        
          Exhibit D; 3

          
            
 

        

        
           

        

      

      
Tenant.  The date by which Tenant has approved
the Cost Proposal shall be known hereafter as the "Cost Proposal
Delivery Date."

       

      4.3. Construction
of Improvements by Contractor under the Coordination of
Landlord.

       

      4.3.1. Over-Allowance
Amount.  On the next business day following the Cost Proposal
Delivery Date, Tenant shall deliver to Landlord an amount (the "Over-Allowance
Amount") equal to the difference between (i) the amount of the Cost
Proposal and (ii) the amount of the Improvement Allowance (less any portion
thereof already disbursed by Landlord, or in the process of being disbursed by
Landlord, on or before the Cost Proposal Delivery Date).  The
Over-Allowance Amount shall be disbursed by Landlord prior to the disbursement
of any then remaining portion of the Improvement Allowance, and such
disbursement shall be pursuant to the same procedure as the Improvement
Allowance.  In the event that, after the Cost Proposal Delivery Date,
any revisions, changes, or substitutions shall be made with Tenant's approval to
the Construction Drawings or the Improvements, any additional costs which arise
in connection with such revisions, changes or substitutions or any other
additional costs shall be paid by Tenant to Landlord immediately upon Landlord's
request as an addition to the Over-Allowance Amount.  Tenant shall
have no obligation to pay Landlord for any costs arising from Landlord's or the
Contractor's negligence, willful misconduct or breach of the construction
contract.

       

      4.3.2. Landlord's
Retention of Contractor.  Landlord shall independently retain
Contractor, on behalf of Tenant, to construct the Improvements in accordance
with the Approved Working Drawings and the Cost Proposal and Landlord shall
coordinate the construction by Contractor, and Tenant shall pay a construction
coordination fee (the "Landlord Coordination
Fee") to Landlord in an amount equal to the product of (i) five
percent (5%) and (ii) an amount equal to the Improvement Allowance plus the
Over-Allowance Amount (as such Over-Allowance Amount may increase pursuant to
the terms of this Tenant Work Letter) or if not all of the Improvement Allowance
is used, an amount equal to the Improvement Allowance minus the unused amount
thereof.

       

      SECTION
5

       

      COMPLETION
OF THE IMPROVEMENTS

       

      5.1. Substantial
Completion.  For purposes of this Lease, "Substantial
Completion" of the Improvements in the Premises shall occur upon (i)
receipt of a certificate of occupancy, temporary certificate of occupancy, or
other indication that the entire Premises may be legally occupied, and (ii) the
completion of construction of the Improvements in the entire Premises pursuant
to the Approved Working Drawings, with the exception of any punch list items
which would not materially affect Tenant's use of the Premises and any tenant
fixtures, work-stations, built-in furniture, or equipment to be installed by
Tenant.

       

      5.2. Delay of the
Substantial Completion of the Premises.  Except as provided in
this Section 5, the Commencement Date and Tenant's obligation to pay rent
for the Premises shall occur as set forth in this Lease.  However, if
there shall be a delay or there are delays in the Substantial Completion of the
Improvements in the Premises as a result of the following (collectively, "Tenant
Delays"):

       

      5.2.1. Tenant's
failure to comply with the Time Deadlines;

       

      5.2.2. Tenant's
failure to timely approve any matter requiring Tenant's
approval;

       

      5.2.3. A breach
by Tenant of the terms of this Tenant Work Letter or the
Lease;

       

      5.2.4. Changes in
any of the Construction Drawings after approval of the same by Landlord or
because the same do not comply with Code or other applicable
laws;

       

      5.2.5. Tenant's
request for changes in the Approved Working Drawings;

       

      5.2.6. Tenant's
requirement for materials, components, finishes or improvements which are not
available in a commercially reasonable time given the anticipated date of
Substantial Completion of the Improvements in the Premises, or which are
different from, or not included in, the Standard Improvement
Package;

       

      
        
           

        

        
          Exhibit D; 4

          
            
 

        

        
           

        

      

       

      5.2.7. Changes to
the Base, Shell and Core required by the Approved Working Drawings;
or

       

      5.2.8. Any other
wrongful acts or omissions of Tenant, or its agents, or employees which causes a
delay in Substantial Completion;

       

      then,
notwithstanding anything to the contrary set forth in the Lease or this Tenant
Work Letter and regardless of the actual date of the Substantial Completion of
Improvements in the Premises, the date of Substantial Completion thereof shall
be deemed to be the date that Substantial Completion would have occurred if no
Tenant Delay or Delays, as set forth above, had occurred.

       

       

      SECTION
6

       

      MISCELLANEOUS

       

      6.1. Tenant's
Representative.  Tenant has designated Stephen J. Turner as its
sole representative with respect to the matters set forth in this Tenant Work
Letter, who, until further notice to Landlord, shall have full authority and
responsibility to act on behalf of the Tenant as required in this Tenant Work
Letter.

       

      6.2. Landlord's
Representative.  Prior to commencement of construction of
Improvements, Landlord shall designate a representative with respect to the
matters set forth in this Tenant Work Letter, who, until further notice to
Tenant, shall have full authority and responsibility to act on behalf of the
Landlord as required in this Tenant Work Letter.

       

      6.3. Time of the
Essence in This Tenant Work Letter.  Time is of the essence in
this Tenant Work Letter.  Unless otherwise indicated, all references
herein to a "number of days" shall mean and refer to calendar
days.

       

      6.4. Early
Entry/Fixturization.  Provided that Tenant and its agents do
not interfere with Landlord's work in the Premises, Landlord shall allow Tenant
access to the Premises beginning on the date anticipated by Landlord to be
thirty (30) days prior to the Commencement Date, for the purpose of Tenant
installing furniture and equipment (including telephones, telecommunications
equipment, cabling, security equipment, audio-visual equipment and computers) in
the Premises.  Prior to Tenant's entry into the Premises as permitted
by the terms of this Section 6.4, Tenant shall submit certificates of insurance
reasonably acceptable to Landlord and shall submit a schedule to Landlord (and
the Contractor, if so requested by Landlord), for their approval, which schedule
shall detail the timing and purpose of Tenant's entry.  Tenant shall
hold Landlord harmless from and indemnify, protect and defend Landlord against
any loss or damage to the Project or Premises and against injury to any persons
caused by Tenant's actions pursuant to this
Section 6.4.

       

      
        
           

        

        
          Exhibit D; 5

          
            
 

        

        
           

        

      

       

      SCHEDULE
1

       

       

      TIME
DEADLINES

      
        	 
      	
                Dates

              	
                Actions to be
      Performed

              
	
                A. 

              	
                June 20,
      2008

              	
                Tenant
      to deliver Final Space Plan to Landlord.

              
	
                B. 

              	
                July 7,
      2008

              	
                Tenant
      to deliver Final Working Drawings to
Landlord.

              


      

       

      
        
           

        

        
          Schedule 1; 1

          
            
 

        

        
           

        

      

       

      EXHIBIT
E

       

       

      LETTER OF
CREDIT

       

      Arden
Realty Limited Partnership

      11601 Wilshire
Boulevard, Fourth Floor

      Los
Angeles, California  90025

      Attention:  Legal
Department

       

      Ladies and
Gentlemen:

       

      We hereby
establish in your favor, for the account of SCOLR Pharma, Inc., a Delaware
corporation ("Applicant"),
our Irrevocable Letter of Credit and authorize you to draw on us at sight the
aggregate amount of Five Hundred Sixty-Four Thousand Dollars ($564,000.00)
("Stated
Amount").

       

      Funds
under this Letter of Credit are available to Arden Realty Limited Partnership, a
Maryland limited partnership (the "Beneficiary")
as follows:

       

      Any and
all of the sums hereunder may be drawn down at any time and from time to time
from and after the date hereof by Beneficiary when accompanied by this Letter of
Credit and a written certification signed by an authorized signatory of
Beneficiary certifying that Beneficiary is entitled to make such draw and that
such sums are due and owing to Beneficiary pursuant to that certain Standard
Multi-Tenant Lease dated ________________, 2008 ("Lease") by and
between Beneficiary, as Landlord, and Applicant, as Tenant, together with a
notarized certification by any such individual representing that such individual
is authorized by Beneficiary to take such action on behalf of
Beneficiary.  The sums drawn by Beneficiary under this Letter of
Credit shall be payable upon demand without necessity of notice to the
Applicant.  Partial drawings shall be permitted.

       

      This
Letter of Credit is transferable in its entirety to any transferee of Landlord's
interest in the Lease who assumes Landlord's obligations under the Lease or to a
lender under any mortgage or deed of trust encumbering the property which is the
subject of the Lease who agrees to abide by the provisions of the Lease with
respect to this Letter of Credit and amounts drawn hereon.  Should a
transfer be desired, such transfer will be subject to the return to us of this
Letter of Credit, together with notarized certifications by such individuals
representing that (i) such transferee meets the above requirements and
(ii) such individuals are authorized by Beneficiary and transferee,
respectively, to take such action on behalf of Beneficiary and transferee,
respectively, and written instructions.

       

      The amount
of each draft must be endorsed on the reverse hereof by the negotiating
bank.  We hereby agree that this Letter of Credit shall be duly
honored upon presentation and delivery of the certification specified
above.

       

      This
Letter of Credit shall expire on ________________, 200__.

       

      Notwithstanding
the above expiration of this Letter of Credit, the term of this Letter of Credit
shall be automatically renewed for successive, additional one (1) year periods
unless, at least thirty (30) days prior to any such date of expiration, the
undersigned shall give written notice to Beneficiary, by certified mail, return
receipt requested and at the address set forth above or at such other address as
may be given to the undersigned by Beneficiary, that this Letter of Credit will
not be renewed.

       

      This
Letter of Credit is governed by the International Standby Practices 1998,
International Chamber of Commerce Publication No. 590.

       

      Very truly
yours,

       

      (Name of
Issuing Bank)

       

      By:                                                                

       

      
        
           

        

        
          Exhibit E; 1

          
            
 

        

        
           

        

      

       

      EXHIBIT
F

       

       

      SITE
PLAN

       

      

      
        
           

        

        
          Exhibit F; 1

          
            
 

        

        
           

        

      

       

      STANDARD
MULTI-TENANT LEASE

       

      BY AND
BETWEEN

       

      ARDEN
REALTY LIMITED PARTNERSHIP,

       

      a
Maryland limited partnership,

       

      AS
LANDLORD,

       

      AND

       

      SCOLR
PHARMA, INC.

       

      a
Delaware corporation,

       

      AS
TENANT

       

      NORTH
CREEK CORPORATE CENTER

      19204
North Creek Parkway

       

      
        
           

        

        
           

          
            
 

        

        
           

        

      

       

      
        
          	
                   

                	 	PAGE 
	
                  ARTICLE
      1

                	
                  BASIC
      LEASE PROVISIONS

                	
                  1

                
	
                  ARTICLE
      2

                	
                  TERM/PREMISES

                	
                  3

                
	
                  (a)

                	
                  Term

                	
                  3

                
	
                  (b)

                	
                  Premises

                	
                  4

                
	
                  ARTICLE
      3

                	
                  RENTAL

                	
                  4

                
	
                  (a)

                	
                  Basic
      Rental

                	
                  4

                
	
                  (b)

                	
                  Direct
      Costs

                	
                  4

                
	
                  (c)

                	
                  Definitions

                	
                  5

                
	
                  (d)

                	
                  Determination
      of Payment

                	
                  7

                
	
                  (e)

                	
                  Audit
      Right

                	
                  8

                
	
                  ARTICLE
      4

                	
                  SECURITY
      DEPOSIT/LETTER OF CREDIT

                	
                  9

                
	
                  (a)

                	
                  Security
      Deposit

                	
                  9

                
	
                  (b)

                	
                  Letter
      of Credit

                	
                  9

                
	
                  ARTICLE
      5

                	
                  HOLDING
      OVER

                	
                  11

                
	
                  ARTICLE
      6

                	
                  OTHER
      TAXES

                	
                  12

                
	
                  ARTICLE
      7

                	
                  USE

                	
                  12

                
	
                  ARTICLE
      8

                	
                  CONDITION
      OF PREMISES

                	
                  13

                
	
                  ARTICLE
      9

                	
                  REPAIRS
      AND ALTERATIONS

                	
                  13

                
	
                  (a)

                	
                  Landlord's
      Obligation

                	
                  13

                
	
                  (b)

                	
                  Tenant's
      Obligation

                	
                  14

                
	
                  (c)

                	
                  Alterations

                	
                  14

                
	
                  (d)

                	
                  Insurance;
      Liens

                	
                  15

                
	
                  (e)

                	
                  Costs
      and Fees; Removal

                	
                  15

                
	
                  ARTICLE
      10

                	
                  LIENS

                	
                  15

                
	
                  ARTICLE
      11

                	
                  PROJECT
      SERVICES

                	
                  16

                
	
                  (a)

                	
                  Basic
      Services

                	
                  16

                
	
                  (b)

                	
                  HVAC
      Balance

                	
                  16

                
	
                  (c)

                	
                  Telecommunications

                	
                  16

                
	
                  (d)

                	
                  Sole
      Electrical Representative

                	
                  17

                
	
                  (e)

                	
                  Backup
      Generator

                	
                  17

                
	
                  (f)

                	
                  Abatement
      Events

                	
                  17

                
	
                  ARTICLE
      12

                	
                  RIGHTS
      OF LANDLORD

                	
                  18

                
	
                  (a)

                	
                  Right
      of Entry

                	
                  18

                
	
                  (b)

                	
                  Maintenance
      Work

                	
                  18

                
	
                  (c)

                	
                  Rooftop

                	
                  19

                
	
                  ARTICLE
      13

                	
                  INDEMNITY;
      EXEMPTION OF LANDLORD FROM LIABILITY

                	
                  19

                
	
                  (a)

                	
                  Indemnity

                	
                  19

                
	
                  (b)

                	
                  Exemption
      of Landlord from Liability

                	
                  19

                
	
                  (c)

                	
                  Security

                	
                  20

                
	
                  ARTICLE
      14

                	
                  INSURANCE

                	
                  20

                
	
                  (a)

                	
                  Tenant's
      Insurance

                	
                  20

                
	
                  (b)

                	
                  Form
      of Policies

                	
                  20

                
	
                  (c)

                	
                  Landlord's
      Insurance

                	
                  21

                
	
                  (d)

                	
                  Waiver
      of Subrogation

                	
                  21

                
	
                  (e)

                	
                  Compliance
      with Law

                	
                  21

                
	
                  ARTICLE
      15

                	
                  ASSIGNMENT
      AND SUBLETTING

                	
                  22

                


        

         

        
          
             

          

          
            (i)

            
              
 

          

          
             

          

        

         

        
          	 	 	PAGE
	
                  ARTICLE
      16

                	
                  DAMAGE
      OR DESTRUCTION

                	
                  23

                
	
                  ARTICLE
      17

                	
                  SUBORDINATION

                	
                  24

                
	
                  ARTICLE
      18

                	
                  EMINENT
      DOMAIN

                	
                  25

                
	
                  ARTICLE
      19

                	
                  DEFAULT

                	
                  26

                
	
                  ARTICLE
      20

                	
                  REMEDIES

                	
                  26

                
	
                  ARTICLE
      21

                	
                  TRANSFER
      OF LANDLORD'S INTEREST

                	
                  28

                
	
                  ARTICLE
      22

                	
                  BROKER

                	
                  28

                
	
                  ARTICLE
      23

                	
                  PARKING

                	
                  29

                
	
                  ARTICLE
      24

                	
                  WAIVER

                	
                  29

                
	
                  ARTICLE
      25

                	
                  ESTOPPEL
      CERTIFICATE

                	
                  30

                
	
                  ARTICLE
      26

                	
                  LIABILITY
      OF LANDLORD

                	
                  30

                
	
                  ARTICLE
      27

                	
                  INABILITY
      TO PERFORM

                	
                  30

                
	
                  ARTICLE
      28

                	
                  HAZARDOUS
      WASTE

                	
                  31

                
	
                  ARTICLE
      29

                	
                  SURRENDER
      OF PREMISES; REMOVAL OF PROPERTY

                	
                  32

                
	
                  ARTICLE
      30

                	
                  MISCELLANEOUS

                	
                  33

                
	
                  (a)

                	
                  SEVERABILITY;
      ENTIRE AGREEMENT

                	
                  33

                
	
                  (b)

                	
                  Attorneys'
      Fees; Waiver of Jury Trial

                	
                  34

                
	
                  (c)

                	
                  Time
      of Essence

                	
                  34

                
	
                  (d)

                	
                  Headings;
      Joint and Several

                	
                  34

                
	
                  (e)

                	
                  Reserved
      Area

                	
                  34

                
	
                  (f)

                	
                  NO
      OPTION

                	
                  34

                
	
                  (g)

                	
                  Use
      of Project Name; Improvements

                	
                  34

                
	
                  (h)

                	
                  Rules
      and Regulations

                	
                  35

                
	
                  (i)

                	
                  Quiet
      Possession

                	
                  35

                
	
                  (j)

                	
                  Rent

                	
                  35

                
	
                  (k)

                	
                  Successors
      and Assigns

                	
                  35

                
	
                  (l)

                	
                  Notices

                	
                  35

                
	
                  (m)

                	
                  Intentionally
      Omitted

                	
                  35

                
	
                  (n)

                	
                  Right
      of Landlord to Perform

                	
                  35

                
	
                  (o)

                	
                  Access,
      Changes in Project, Facilities, Name

                	
                  36

                
	
                  (p)

                	
                  Signing
      Authority

                	
                  36

                
	
                  (q)

                	
                  Identification
      of Tenant

                	
                  36

                
	
                  (r)

                	
                  Intentionally
      Omitted

                	
                  37

                
	
                  (s)

                	
                  Survival
      of Obligations

                	
                  37

                
	
                  (t)

                	
                  Intentionally
      Omitted

                	
                  37

                
	
                  (u)

                	
                  Governing
      Law

                	
                  37

                
	
                  (v)

                	
                  Office
      of Foreign Assets Control

                	
                  37

                
	
                  (w)

                	
                  Financial
      Statements

                	
                  38

                
	
                  (x)

                	
                  Exhibits

                	
                  38

                
	
                  (y)

                	
                  Independent
      Covenants

                	
                  38

                
	
                  (z)

                	
                  Counterparts

                	
                  38

                
	
                  ARTICLE
      31

                	
                  OPTION
      TO EXTEND

                	
                  38

                
	
                  (a)

                	
                  Option
      Right

                	
                  38

                
	
                  (b)

                	
                  Option
      Rent

                	
                  38

                
	
                  (c)

                	
                  Exercise
      of Options

                	
                  38

                
	
                  (d)

                	
                  Determination
      of Market Rent

                	
                  39

                
	ARTICLE
      32	RIGHT
      OF FIRST OFFER 	39


        

         

        
          
             

          

          
            (ii)

            
              
 

          

          
             

          

        

         

        
          	 	 	PAGE
	
                  (a)

                	
                  Procedure
      for Offer

                	
                  40

                
	
                  (b)

                	
                  Procedure
      for Acceptance

                	
                  40

                
	
                  (c)

                	
                  Lease
      of First Offer Space

                	
                  40

                
	
                  (d)

                	
                  No
      Defaults

                	
                  40

                
	
                  (e)

                	
                  Remedy

                	
                  40

                
	
                  ARTICLE
      33

                	
                  SIGNAGE

                	
                  41

                
	 
      	 
      	 
      
	
                  Exhibit
      "A"

                	
                  Premises

                	 
      
	
                  Exhibit
      "A-1"

                	
                  Legal
      Description of Real Property

                	 
      
	
                  Exhibit
      "B"

                	
                  Rules
      and Regulations

                	 
      
	
                  Exhibit
      "C"

                	
                  Notice
      of Lease Term Dates and Tenant's Proportionate Share

                	 
      
	
                  Exhibit
      "D"

                	
                  Tenant
      Work Letter

                	 
      
	
                  Exhibit
      "E"

                	
                  Letter
      of Credit

                	 
      
	
                  Exhibit
      "F"

                	
                  Site
      Plan

                	 
      


        

      

       

      
        
           

        

        
          (iii)

          
            
 

        

        
           

        

      

       

      
        
          	DEFINED
      TERMS	 	PAGE
	
                  Abatement
      Event

                	 
      	
                  17

                
	
                  Abatement
      Notice

                	 
      	
                  17

                
	
                  ADA

                	 
      	
                  6

                
	
                  Additional
      Rent

                	 
      	
                  5

                
	
                  Adjustment
      Dates

                	 
      	
                  10

                
	
                  Affiliate

                	 
      	
                  38

                
	
                  Affiliated
      Assignee

                	 
      	
                  38

                
	
                  Alterations

                	 
      	
                  14

                
	
                  Applicant

                	 
      	
                  Exhibit
      F

                
	
                  Approved
      Working Drawings

                	 
      	
                  Exhibit
      D

                
	
                  Architect

                	 
      	
                  Exhibit
      D

                
	
                  Base,
      Shell and Core

                	 
      	
                  Exhibit
      D

                
	
                  Basic
      Rental

                	 
      	
                  2

                
	
                  Beneficiary

                	 
      	
                  Exhibit
      F

                
	
                  Brokers

                	 
      	
                  3

                
	
                  Claims

                	 
      	
                  19

                
	
                  Code

                	 
      	
                  Exhibit
      D

                
	
                  Commencement
      Date

                	 
      	
                  1

                
	
                  Confidential
      Information

                	 
      	
                  18

                
	
                  Construction
      Drawings

                	 
      	
                  Exhibit
      D

                
	
                  Contractor

                	 
      	
                  Exhibit
      D

                
	
                  control

                	 
      	
                  38

                
	
                  Cosmetic
      Alterations

                	 
      	
                  14

                
	
                  Cost
      Proposal

                	 
      	
                  Exhibit
      D

                
	
                  Cost
      Proposal Delivery Date

                	 
      	
                  Exhibit
      D

                
	
                  Damage
      Repair Estimate

                	 
      	
                  23

                
	
                  Development

                	 
      	
                  1

                
	
                  Development
      Common Areas

                	 
      	
                  1

                
	
                  Direct
      Costs

                	 
      	
                  5

                
	
                  Dispute
      Notice

                	 
      	
                  8

                
	
                  Economic
      Terms

                	 
      	
                  40

                
	
                  Eligibility
      Period

                	 
      	
                  17

                
	
                  Engineers

                	 
      	
                  Exhibit
      D

                
	
                  Environmental
      Laws

                	 
      	
                  32

                
	
                  Estimate

                	 
      	
                  7

                
	
                  Estimate
      Statement

                	 
      	
                  7

                
	
                  Estimated
      Direct Costs

                	 
      	
                  7

                
	
                  Event
      of Default

                	 
      	
                  26

                
	
                  Expiration
      Date

                	 
      	
                  1

                
	
                  Final
      Space Plan

                	 
      	
                  Exhibit
      D

                
	
                  Final
      Working Drawings

                	 
      	
                  Exhibit
      D

                
	
                  First
      Offer Notice

                	 
      	
                  40

                
	
                  First
      Offer Space

                	 
      	
                  39

                
	
                  Force
      Majeure

                	 
      	
                  30

                
	
                  Hazardous
      Material

                	 
      	
                  32

                
	
                  Hazardous
      Materials List

                	 
      	
                  31

                
	
                  HVAC
      System

                	 
      	
                  16

                
	
                  Improvement
      Allowance

                	 
      	
                  Exhibit
      D

                
	
                  Improvement
      Allowance Items

                	 
      	
                  Exhibit
      D

                
	
                  Initial
      Installment of Basic Rental

                	 
      	
                  3

                
	
                  Interest
      Notice

                	 
      	
                  38

                
	
                  Lab
      Portion

                	 
      	
                  2

                
	
                  Landlord

                	 
      	
                  1

                
	
                  Landlord
      Coordination Fee

                	 
      	
                  Exhibit
      D

                
	
                  Landlord
      Parties

                	 
      	
                  19

                
	
                  Laws

                	 
      	
                  12

                
	
                  Lease

                	 
      	
                  1

                
	
                  Lease
      Year

                	 
      	
                  3

                
	
                  Letter
      of Credit

                	 
      	
                  9

                
	
                  Market
      Rent

                	 
      	
                  38

                


        

         

        
          
             

          

          
            (iv)

            
              
 

          

          
             

          

        

         

        
          	 	 	PAGE
	
                  New
      Laws

                	 
      	
                  6

                
	
                  Objectionable
      Name

                	 
      	
                  41

                
	
                  Office
      Portion

                	 
      	
                  2

                
	
                  Operating
      Costs

                	 
      	
                  5

                
	
                  Option

                	 
      	
                  38

                
	
                  Option
      Rent

                	 
      	
                  38

                
	
                  Option
      Rent Notice

                	 
      	
                  38

                
	
                  Option
      Term

                	 
      	
                  38

                
	
                  Original
      Tenant

                	 
      	
                  38

                
	
                  Outside
      Agreement Date

                	 
      	
                  39

                
	
                  Over-Allowance
      Amount

                	 
      	
                  Exhibit
      D

                
	
                  Parking
      Passes

                	 
      	
                  3

                
	
                  Partnership
      Tenant

                	 
      	
                  37

                
	
                  Permits

                	 
      	
                  Exhibit
      D

                
	
                  Permitted
      Use

                	 
      	
                  3

                
	
                  Pharmaceutical
      Development Uses

                	 
      	
                  1

                
	
                  Premises

                	 
      	
                  1

                
	
                  Project

                	 
      	
                  1

                
	
                  Real
      Property

                	 
      	
                  1

                
	
                  Relet
      Term

                	 
      	
                  27

                
	
                  Rent

                	 
      	
                  5

                
	
                  Rental
      Tax

                	 
      	
                  5

                
	
                  Review
      Notice

                	 
      	
                  8

                
	
                  Review
      Period

                	 
      	
                  8

                
	
                  Rules
      and Regulations

                	 
      	
                  35

                
	
                  Security
      Deposit Laws

                	 
      	
                  11

                
	
                  Security
      Deposit/Letter of Credit

                	 
      	
                  3

                
	
                  Signage

                	 
      	
                  41

                
	
                  Signage
      Specifications

                	 
      	
                  41

                
	
                  SNDA

                	 
      	
                  25

                
	
                  Space
      Planning Allowance

                	 
      	
                  Exhibit
      D

                
	
                  Specifications

                	 
      	
                  Exhibit
      D

                
	
                  Square
      Footage

                	 
      	
                  2

                
	
                  Standard
      Improvement Package

                	 
      	
                  Exhibit
      D

                
	
                  Stated
      Amount

                	 
      	
                  9

                
	
                  Statement

                	 
      	
                  8

                
	
                  Substantial
      Completion

                	 
      	
                  Exhibit
      D

                
	
                  Superior
      Leases

                	 
      	
                  40

                
	
                  Superior
      Rights

                	 
      	
                  40

                
	
                  Supplementary
      Units

                	 
      	
                  16

                
	
                  Tax
      Costs

                	 
      	
                  5

                
	
                  Tenant

                	 
      	
                  1

                
	
                  Tenant
      Delays

                	 
      	
                  Exhibit
      D

                
	
                  Tenant
      Improvements

                	 
      	
                  13

                
	
                  Tenant’s
      Acceptance

                	 
      	
                  39

                
	
                  Tenant's
      Proportionate Share

                	 
      	
                  3

                
	
                  Term

                	 
      	
                  1

                
	
                  Time
      Deadlines

                	 
      	
                  Exhibit
      D

                
	
                  Transfer

                	 
      	
                  22

                
	
                  Transfer
      Premium

                	 
      	
                  23

                
	
                  Transferee

                	 
      	
                  23

                
	
                  Warehouse
      Portion

                	 
      	
                  2

                


        

      

    

     

    (v)