|               |   | **EXHIBIT 10.5    ** |
|--------------------|--------|------------------------------------------|
| ** **

  |   |                                     |

** **

**AMENDMENT 1**

 

 

To the lease dated May 6, 1997,between Paulson Investment Company, as Tenant and Trustees of TheOregon-Washington Carpenters-Employers Pension Trust Fund and Trustees of TheOregon Laborers-Employers Pension Trust Fund, as Landlord, subsequentlyassigned to Runhill Investment Company; for approximately 17,136 square feet onthe entire second and third floors of the Paulson Capital Building, 811 S.W.Front Avenue, Portland, Oregon.  It isnow the intention of said parties to extend the term as stated below:

 
| **Term:**                |   | Commencing  June 1, 2002 for a term of seven (7) years expiring on May 31, 2009.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |
|--------------------------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|
|                     |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |
| **Base Rental Rate:**    |   | June 2002 -  May 2005 at $25,704 per month.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |
|                     |   | June 2005 -  May 2007 at $27,846 per month.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |
|                     |   | June 2007 -  May 2009 at $29,988 per month.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |
|                     |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |
| **Tenant Improvements:** |   | Landlord, at  its sole cost, shall provide tenant improvement dollars up to a maximum  amount of $171,316.00.  This amount  shall be applied towards any and all costs, except furniture or personal  items, associated with Tenant's improvement to the Premises.  Any costs in excess of $171,316.00 shall  be the sole responsibility of the Tenant regardless of the reason for such  excess.  Tenant Improvements can  commence as soon as this Amendment 1 is fully executed and Landlord will  reimburse Tenant on or before April 1, 2002 of Tenant funded Tenant  Improvements.  After April 1, 2002,  Landlord to fund Tenant Improvements up to the previously mentioned maximum  amount of $171,316.00.  Landlord shall  coordinate and manage Tenant's improvements to the Premises.  Any savings of the Tenant Improvement  allowance of $171,316.00 will accrue to the Landlord and the Tenant equally. |   |
|                     |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |
| **HVAC:**                |   | Landlord  represents and warrants that the building's mechanical (HVAC) system has the  capacity to maintain ASHRAE Design Standards of operation between 70 and 76  degrees Fahrenheit during the cooling season at up to 90 degrees outside  temperature.  The heating temperature  can be maintained from 66 to 70 degrees in the heating season with an outside  temperature of not less than 32 degrees.   For extreme temperatures (above 90 or below 32 degrees), The ASHRAE  Design Standards for Portland, Oregon calls for mechanical systems to maintain  a differential of 20 (plus or minus) degrees from inside to outside  temperatures during these periods.   Landlord warrants that it will maintain the existing mechanical  systems to accommodate ASHRAE Design Standards.                                                                                                                                       |   |
|                     |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |
|                     |   | Landlord  shall install up to two (2) recording thermometers in mutually agreeable  locations on each floor within the Premises upon request from Tenant.  In the event the HVAC is unable to  maintain the temperatures as outlined above for a period of two (2) business  days after written notice from the tenant, the landlord will credit to the  tenants rental account the sum of $200.00 per day, in addition to any other  remedies allowed under the lease or the law, commencing on the third business  day until the temperature is with in the above temperatures range.  In the event of a mechanical breakdown of  the HVAC system the landlord will use it's best efforts to have the system  repaired immediately, including the use of expediting delivery of parts.  No penalty shall be imposed upon the landlord  when it's best efforts are extended or for events outside the landlord's  control.      |   |

 

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|                   |   | Tenant will  include appropriate modifications including ductwork modifications and  rebalancing to the mechanical system when doing their tenant improvements to  the leased space.  The tenant will not  increase the heat load in the leased premises from its current level without  appropriate re-ducting, re-balancing the system and/or installation of  additional cooling equipment.  The  tenant will close the window blinds on the east and south exposures of the  building to reduce solar heat gain in the leased premises as is appropriate  for times of heavy solar load. |   |
|------------------------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|
|                   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |
| **Electrical:**        |   | Notwithstanding  the provisions of Sections 4.2 or 5.2 of the lease or any other provisions  thereof which are inconsistent with the following,  Landlord will provide at no cost to Tenant a thirty (30) pole  panel with 100 amperage on the second floor and an additional thirty (30)  pole panel with 100 amperage for the third floor.  The payment for distribution of this additional electrical  capacity from the panel to the new outlets will be funded out of the previous  Tenant improvement allowance or by Tenant.                                                          |   |
|                   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |
| **Option to Renew:**   |   | Tenant shall  have the option to renew this lease for one (1) additional period of three  (3) years at then current market rates.   The market rent shall be set by negotiation, however, in any event  shall not exceed $24.00 per square foot per year.                                                                                                                                                                                                                                                                                                                                         |   |
|                   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |
| **1st Floor Storage:** |   | The new  storage rental rate shall be as follows:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |
|                   |   | June 2002 -  May 2005 at $800.00 per month.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |
|                   |   | June 2005 -  May 2007 at $861.54 per month.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |
|                   |   | June 2007 -  May 2009 at $923.08 per month.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |
|                   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |
| **New Base Years:**    |   | Per Sections  19.1 and 19.3 of this Lease the "Base Year" for each shall be  changed to 2001 - 2002 and 2002, respectively.                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |
|                   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |

All otherterms and conditions of the Lease dated May 6, 1997 shall remain in full forceand effect.

 

**APPROVED & ACCEPTED:**

 
| Lessor:                     |                        | Lessee: |           |
|-----------------------------|-----------------------------|---------|----------------|
| Runhill  Investment Company | Paulson  Investment Company |    |
|                        |                        |    |           |   |
| By:                         | /s/ Ted E.  Runstein        | By:     | /s/ Glen Davis |   |
|                        |                        |    |           |   |
| Date:                       | 8/10/01                     | Date:   | 8/7/01         |   |
|                             |                             |         |                |  |  |  |

 

 

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