rim_10ksb-ex1037.htm


    EXHIBIT
      10.37

     

    
      
        	
                
                

                 

                AMERICAN
                  PROPERTY MANAGEMENT
                  CORP.

                2154
                  N.E. Broadway Portland,
                  Oregon 97232

                Mailing
                  Address: P.O. Box 12127,
                  Portland, Oregon 97212

                Phone
                  503-281-7779 Fax
                  503-460-2616

                
                

              


      

       

       

       

      OFFICE
        LEASE

       

      This
        Lease (“LEASE”), dated for reference purposes only,

       

      September
        5, 2006

       

      is
        made
        by and between

       

      AMERICAN
        PROPERTY MANAGEMENT CORP. as agent for and on behalf of

       

      WESTON
        INVESTMENT CO. LLC,
        (“LESSOR”), and

       

      Rim
        Semiconductor Company, a Utah
        corporation, (“LESSEE”).

       

      AMERICAN
        PROPERTY MANAGEMENT CORP. Account #C-321-5220-02

       

      LESSOR
        hereby leases to LESSEE the following:

       

      Suite
        #350 consisting of
        approximately 6,967
        rentable square feet (“Premises”)

       

      (See
        Standard of Measurement Section 1.1)

       

      (This
        measurement includes a load factor for the Building of 15%)

       

      in
        the
Multnomah Plaza Office
        Building

       

      located
        at 305 NE 102nd
        Avenue, Portland, OR 97220
(“Building”)

       

      for
        a
        term commencing sixty (60) days
        after issuance of a building permit; (“Commencement Date”)

       

      and
        continuing through thirty six
        (36) full calendar months; (“Expiration Date”)

       

      at
        an
        initial Base Rental of $10,740.79 (U.S.) per month
        (“Base Rent”) (see Section 37.1)

       

      payable
        in advance on the first day of each month at

       

      2154
        N.E.
        Broadway, Suite #200, Portland, Oregon 97232-1561

       

      commencing
        sixty (60) days after issuance
        of a building permit.

       

       

       

      07/10/06

       

      (1)

      LESSOR
        INITIAL 
DL   LESSEE INITIAL  BK 


       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      LESSOR
        and LESSEE covenant and agree as follows:

       

       

       

      
        
          
            1.1 
              STANDARD
              OF MEASUREMENT

          

        

      

       

      
        
          
            	
                  	
                    a.)

                  	
                    Useable
                      Square
                      Footage

                  


          

        

      

       

      Is
        that
        area from the center of the tenant demising wall to the center of the opposite
        tenant demising wall which is established by the American National Standard
        Method of Measurement of Office Floor Space (ANSI Z65.1-1980) and the Building
        Owners and Manager Association (BOMA).

       

      
        	
              	
                b.)

              	
                Load
                  Factor

              


      

       

      Is
        a
        percentage of all the Building common areas such as Building lobby, elevator
        lobbies, common hallways, common restrooms, common utility service closets,
        common conference room, common canteen/kitchen lounge areas and designated
        smoking areas. Not calculated are vertical floor penetrations such as stairways,
        elevator shafts or mechanical shafts.

       

      
        	
              	
                c.)

              	
                Rentable
                  Square
                  Footage

              


      

       

      Is
        the
        calculated useable square footage plus a percentage of the common area of
        the
        Building. The total of the two equal rentable square footage.

       

      Formula:

      6,058
        useable square feet +
15% Load Factor =
6,967
        rentable square
        feet

       

      Note:
        The
        actual common area square footage may exceed the Load Factor of this
        Lease.

       

      
        	
              	
                d.)

              	
                These
                  square footages are approximations only and may vary from the actual
                  square footage. Prior to

              


      

       

      occupancy
        LESSEE may inspect and measure the Premises to confirm the square footage.
        As of
        occupancy LESSEE shall be deemed to have accepted the Premises, and will
        be
        deemed to have waived any objection to the square footage approximations
        set
        forth herein.

       

      
        2.1 
          DELIVERY
          OF POSSESSION

      

       

      Should
        LESSOR be unable to deliver possession of the Premises on the date fixed
        for the
        Commencement Date of the term, the Commencement Date will be deferred and
        LESSEE
        shall owe no rent until receiving notice from LESSOR tendering possession
        to
        LESSEE. If possession is not so tendered within 90 days following the
        Commencement Date of the term, then LESSEE may elect to cancel this LEASE
        by
        providing written notice to LESSOR within 10 days following expiration of
        the 90
        day period. LESSOR shall have no liability to LESSEE for delay in delivering
        possession, nor shall such delay extend the term of this LEASE in any
        manner.

       

      
        2.2 
          EARLY
          POSSESSION

      

       

      If
        LESSEE
        occupies the Premises prior to said Commencement Date, such occupancy shall
        be
        subject to all provisions of this LEASE, such occupancy shall not advance
        the
        Expiration Date, and LESSEE shall pay rent for such period at the initial
        monthly rates set forth above.

       

      
        2.3 
          ACCEPTANCE
          OF PREMISES

      

       

      Except
        as
        may be provided for in any exhibit, appendix or rider hereto, occupancy shall
        be
        construed to mean that LESSEE expressly acknowledges that it has fully inspected
        the Premises and accepts the Premises in their present condition. LESSEE
        further
        acknowledges LESSOR shall not be responsible for any alterations, improvements or repairs unless by written agreement
        of the parties,
        attached to and made a part of this LEASE.

       

      (2)

      LESSOR
        INITIAL 
DL   LESSEE INITIAL  BK 


       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      
        3.1 
          RENT
          PAYMENT

      

       

      Upon
        LESSEE'S execution of the LEASE, LESSEE shall pay the Base Rent for the first
        calendar month of the LEASE term for which rent is payable. LESSEE shall
        pay the
        Base Rent for the Premises and any additional charges provided herein without
        deduction or offset. Rent for any partial month during the lease term shall
        be
        prorated to reflect the number of days during the month that LESSEE occupies
        the
        Premises based on a thirty (30) day month/360 day year. Rent or any additional
        charges not paid when due shall bear interest at the rate of one-and-one-half
        percent (1 1/2%) per month until paid in full. LESSOR may at its option impose
        a
        late charge of .10 for each $1 due or $50.00, whichever is greater, for rent
        or
        other additional charges paid made more than 10 days after its due date in
        lieu
        of interest for the first month of delinquency, without waiving any other
        remedies available for default.

       

      
        4.1 
          SECURITY
          DEPOSIT

      

       

      Concurrently
        with the execution of this LEASE by the LESSEE, LESSEE shall deliver to LESSOR
        Ten Thousand Seven Hundred
        Forty and 79/100’s dollars ($10,740.79) as security
        for the
        full, timely and faithful performance by LESSEE of every covenant and condition
        of this LEASE. It is expressly understood and agreed the security deposit
        is not
        an advance of rental deposit or a measure of LESSOR’S damages in the case of a
        default. This deposit shall not bear interest. The security deposit shall
        not be
        considered a trust fund. LESSOR does not represent that LESSOR is acting
        as a
        trustee or in any fiduciary capacity in controlling or using LESSEE’S security
        deposit as provided for herein. If LESSEE shall default with respect to any
        covenant or condition of this LEASE, LESSOR may apply the whole or part of
        such
        security deposit to the payment of any sum in default or any other sum which
        LESSOR may be required to spend by reason of LESSEE’S default. In such event,
        LESSEE shall upon demand immediately pay to LESSOR the amount necessary to
        restore the security deposit to its original amount. When the Base Rent is adjusted
        per
        the terms of this LEASE,
        an additional amount shall be paid to bring the security deposit amount equal
        to
the newly adjusted
        Base
        Rent amount. If LESSEE, complies with all of the covenants and conditions
        of this LEASE, the security deposit or any balance thereof shall be returned
        to
        the LESSEE within sixty (60) days after the Expiration Date of the lease
        term.

       

      5.1 
        USE

       

      LESSEE
        shall use the Premises for professional business office use only with no
        retail
        sales or manufacturing and for no other purpose without LESSOR'S consent.
        In
        connection with its use, LESSEE shall at its expense promptly comply with
        all
        applicable laws, ordinances, rules and regulations of any public authority
        and
        shall not annoy, obstruct, or interfere with the rights of the other tenants
        of
        the Building. LESSEE shall create no nuisance nor allow any objectionable
        fumes,
        noise, or vibrations to be emitted from the Premises. LESSEE shall not conduct
        any activities that will increase LESSOR'S insurance rates for any portion
        of
        the Building or that will in any manner degrade or damage the reputation
        of the
        Building.

       

      6.1 
        EQUIPMENT

       

      LESSEE
        shall install in the Premises only such office equipment as is customary
        for
        general office use and shall not overload the weight capacity of the floors
        or
        the capacity of the electrical circuits of the Premises or Building or alter
        the
        plumbing or wiring of the Premises or Building. LESSOR must approve, in advance,
        the location and manner of installing any electrical, heat generating or
        communication equipment or exceptionally heavy articles. Any additional air
        conditioning required because of heat generating equipment or special lighting
        installed by the LESSEE shall be installed and maintained at LESSEE'S expense.
        LESSOR shall have no obligation to permit the installation of equipment by
        any
        telecommunications provider whose equipment is not then servicing the
        building.

       

      (3)

      LESSOR
        INITIAL 
DL   LESSEE INITIAL  BK 


       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      7.1
        SIGNS

       

      No
        signs,
        awnings, antennas, or other apparatus shall be painted on or attached to
        the
        Building or anything placed on any glass or woodwork of the Premises or
        positioned so as to be visible from outside the Premises without LESSOR'S
        written approval as to design, size, location and color. All signs installed
        by
        LESSEE shall comply with LESSOR'S standards for signs and all applicable
        codes
        and ordinances and all signs and sign hardware shall be removed upon termination
        of this LEASE with the sign location restored to its former state unless
        LESSOR
        elects to retain all or any portion thereof. LESSOR shall provide and install
        building standard signage in the name of the LESSEE as it appears in this
        LEASE
        for the Building lobby and suite entry. LESSEE shall be responsible for all
        signage expense if the LEASE term is twelve months or less. Any changes
        thereafter requested by LESSEE and approved by LESSOR shall be at LESSEE'S
        sole
        expense.

       

      The
        LESSOR will allow Lessor approved vinyl lettering and logo similar in size
        and
        type of existing signage to be installed by LESSOR’s sign company at Lessee’s
        sole cost on the West glass entry to the ground floor of the
        Building.

      The
        Lessor will replace building standard signage on the Suite 105 sign to say
“Rim
        Semiconductor Company” at Lessor cost.

       

      The
        Lessor will install the same to Suite 103 sign at Lessor cost.

       

      The
        Lessor will update the Building lobby directory to reflect the name
        change.

       

      8.1
        UTILITIES AND SERVICES

       

      LESSOR
        shall furnish heat, electricity, elevator service, and if the Premises are
        air
        conditioned, air conditioning during the normal Buildings hours of 7:00 A.M.
        to
        6:00 P.M., Monday through Friday, except holidays and 7:00 A.M. to 2:00 P.M.
        Saturdays, except holidays. The acceptable temperature range for the Premises
        is
        between 67 degrees to 75 degrees Fahrenheit, as measured from the thermostat
        level which is approximately sixty inches (60") above the floor, unless there
        are extreme weather conditions which create an unusually hot or cold condition.
        Janitorial service will be provided in accordance with the regular schedule
        of
        the Building, which schedule and service may change from time to time. LESSEE
        shall comply with all government laws and regulations regarding the use or
        reduction of use of utilities on the Premises. Interruption of services or
        utilities shall not be deemed an eviction or disturbance of LESSEE'S use
        and
        possession of the Premises, render LESSOR liable to LESSEE for damages, or
        relieve LESSEE from performance of LESSEE'S obligations under this LEASE,
        but
        LESSOR shall take all reasonable steps to correct any interruptions in service.
        Electrical service furnished will be 110 volts unless different service already
        exists in the Premises. The LESSOR shall only provide repair and maintenance
        to
        building standard florescent light fixtures. The LESSOR shall not be responsible
        for repair, maintenance (including light bulb replacement) for non-building
        standard light fixtures. LESSEE shall provide its own surge protection for
        power
        furnished to the Premises.

       

      8.2
        EXTRA USAGE

       

      If
        LESSEE
        uses excessive amounts of LESSOR provided utilities and/or services of any
        kind
        because of operation during normal Building hours and/or outside of normal
        Building hours, high demands from office machinery and equipment, nonstandard
        lighting or any other cause, LESSOR may impose a reasonable charge for supplying
        such extra utilities and/or services, which charge shall be payable monthly
        by
        LESSEE in conjunction with rent payments. In case of dispute over any extra
        charge under this paragraph, LESSOR shall designate a qualified independent
        engineer whose decision shall be conclusive on both parties. LESSOR and LESSEE
        shall each pay one-half of the cost of such determination.

       

      8.3
        REMOVAL OF DEBRIS

       

      LESSEE
        shall be solely responsible for and promptly pay for the removal of all debris,
        cardboard, all and any other refuse generated in LESSEE'S moving into premises
        including the replacement of office furniture and equipment during tenancy
        and
        in vacating the Premises. Upon request, LESSOR shall supply LESSEE the name
        of a
        recycling company to remove recyclable items. LESSEE shall pay such additional
        charge in full upon receipt of statement.

       

      (4)

      LESSOR
        INITIAL 
DL   LESSEE INITIAL  BK 


       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      9.1
        MAINTENANCE AND REPAIRS

       

      LESSOR
        shall have no liability for failure to perform required maintenance and repair
        unless written notice of the needed maintenance or repair is given by LESSEE
        and
        LESSOR fails to commence efforts to remedy the problem in a reasonable time
        and
        manner. LESSOR shall have the right to erect scaffolding and other apparatus
        necessary for the purpose of making repairs, and LESSOR shall have no liability
        for interference with LESSEE'S use because of repairs and installations,
        nor
        shall LESSOR be required to provide LESSEE with advance written notice of
        LESSOR'S access to the Premises. LESSEE shall have no claim against LESSOR
        for
        any interruption or reduction of services or interference with LESSEE'S
        occupancy, and no such interruption or reduction shall be construed as a
        constructive or other eviction of LESSEE. Repair of damage caused by negligent
        or intentional acts or breach of this LEASE by LESSEE, its employees, or
        invitees shall be at LESSEE'S expense.

       

      The
        LESSOR shall only provide repair and maintenance to building standard florescent
        light fixtures. The LESSOR shall not be responsible for repair, maintenance
        (including light bulb replacement) for non-building standard light
        fixtures.

      The
        Lessor will repair the exterior third (3rd)
        floor
        upper window metal stripping that is falling prior to the Lease Commencement
        Date.

       

      10.1
        ALTERATIONS

       

      LESSEE
        shall not make any alterations, additions, or improvements to the Premises,
        change the color or character of the interior, or install any wall or floor
        covering without LESSOR'S prior written consent. Any such additions,
        alterations, or improvements, except for removable machinery and unattached
        moveable trade fixtures shall at once become part of the realty and belong
        to
        LESSOR. LESSOR may at its option require that LESSEE remove any alterations
        and
        restore the Premises to the original condition upon termination of this LEASE.
        LESSOR shall have the right to approve the contractor used by LESSEE for
        any
        work in the Premises, and to post notices of nonresponsibility in connection
        with any work being performed by LESSEE in the Premises. LESSEE agrees that
        any
        Building or fixture modifications within the LESSEE'S Premises that is required
        to accommodate the LESSEE, employees or invitees of the LESSEE, as required
        by
        the Americans with Disabilities Act (ADA), will be at the expense of the
        LESSEE.

       

      The
        LESSEE shall not alter any lock or install a new or additional lock or any
        bolt
        on any door of the Premises without prior written consent of the LESSOR.
        In the
        event LESSEE desires to change or modify door locks on the Premises, LESSEE
        shall notify LESSOR in advance and shall use LESSOR'S authorized locksmith
        and
        LESSEE shall bear such cost.

       

      11.1
        INDEMNITY

       

      LESSEE
        shall not allow any liens to attach to the Building or LESSEE'S interest
        in the
        Premises as a result of its activities. LESSEE shall indemnify and defend
        LESSOR
        from any claim, liability, damage, or loss occurring on the Premises, arising
        out of any activity by LESSEE, its agents, or invitees or resulting from
        LESSEE'S failure to comply with any term or condition of this LEASE. LESSOR
        shall have no liability to LESSEE because of loss or damage caused by the
        acts
        or omissions of other tenants of the Building, or by third parties.

       

      12.1
        INSURANCE

       

      LESSEE
        shall carry liability insurance in the amount of no less than $1,000,000.00
        and
        which insurance shall have an endorsement naming LESSOR and LESSOR'S agent,
        if
        any, as an additional insured and covering the liability insured under Paragraph
        11.1 of this LEASE. LESSEE shall furnish a certificate evidencing such insurance
        which shall state that the coverage shall not be canceled or materially changed
        without 10 days advance written notice to LESSOR and LESSOR'S agent, if any,
        and
        a renewal certificate shall be furnished at least 10 days prior to expiration
        of
        any policy. LESSEE is responsible for their own fire insurance, see Section
        14.1.

       

       

       

       

      (5)

      LESSOR
        INITIAL 
DL   LESSEE INITIAL  BK 


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

       

      13.1
        FIRE OR CASUALTY

       

      "Major
        Damage" means damage by fire or other casualty to the Building or the Premises
        which causes the Premises or any substantial portion of the Building to be
        unusable, or which will cost more than 25 percent (25%) of pre-damage value
        of
        the Building to repair, or which is not covered by insurance. In case of
        Major
        Damage, LESSOR may elect to terminate this LEASE by notice in writing to
        LESSEE
        within 60 days after such date. If this LEASE is not terminated following
        Major
        Damage, LESSOR shall promptly restore the Premises to the condition existing
        just prior to the damage. LESSEE shall promptly restore all damage to tenant
        improvements or alterations installed or paid by LESSEE or pay the cost of
        such
        restoration to LESSOR if LESSOR elects to do the restoration of such
        improvements. Rent shall be reduced from the date of damage until the date
        restoration work being performed by LESSOR is substantially complete, with
        the
        reduction to be in proportion to the area of the Premises not useable by
        LESSEE.

       

      14.1
        WAIVER OF SUBROGATION

       

      LESSEE
        shall be responsible for insuring its personal property and trade fixtures
        located on the Premises. Neither LESSOR nor LESSEE shall be liable to the
        other
        for any loss or damage caused by fire, water damage, sprinkler leakage, or
        any
        of the risks that are or could be covered by a standard all risk insurance
        policy with an extended coverage endorsement, or for any business interruption,
        and there shall be no subrogated claim by one party's insurance carrier against
        the other party arising out of any such loss.

       

      15.1
        EMINENT DOMAIN

       

      If
        a
        condemning authority takes title by eminent domain or by agreement in lieu
        thereof to the entire Building or a portion sufficient to render the Premises
        unsuitable for LESSEE'S use, then either party may elect to terminate this
        LEASE
        effective on the date that possession is taken by the condemning authority.
        Rent
        shall be reduced for the remainder of the term in an amount proportionate
        to the
        reduction in the area of the Premises caused by the taking. All condemnation
        proceeds shall belong to LESSOR, and LESSEE shall have no claim against LESSOR
        or the condemnation award because of the taking.

       

      16.1
        ASSIGNMENT AND SUBLETTING

       

      This
        LEASE shall bind and inure to the benefit of the parties, their respective
        heirs, successors, and assigns, provided that LESSEE shall not assign its
        interest under this LEASE or sublet all or any portion of the Premises without
        first obtaining LESSOR'S consent in writing. This provision shall apply to
        all
        transfers by operation of law including but not limited to mergers and changes
        in control of LESSEE. No assignment or subletting shall relieve LESSEE of
        its
        obligation to pay rent or perform other obligations required by this LEASE,
        and
        no consent to one assignment or subletting shall be a consent to any further
        assignment or subletting. LESSOR shall not unreasonably withhold its consent
        to
        any assignment, or to subletting provided the subrental rate or effective
        rental
        paid by the assignee is not less than the current scheduled rental rate of
        the
        Building for comparable space and the proposed LESSEE is compatible with
        LESSOR'S normal standards for the Building. If LESSEE proposes a subletting
        or
        assignment to which LESSOR is required to consent under this paragraph, LESSOR
        shall have the option of terminating this LEASE and dealing directly with
        the
        proposed sublessee or assignee, or any third party. If an assignment or
        subletting is permitted, any cash profit, or the net value of any other
        consideration received by LESSEE as a result of such transaction shall be
        paid
        to LESSOR promptly following its receipt by LESSEE. LESSEE shall pay any
        costs
        incurred by LESSOR in connection with a request for assignment or subletting,
        including reasonable attorneys' fees.

       

      17.1
        DEFAULT

       

      Any
        of
        the following shall constitute a default by LESSEE under this
        LEASE:

       

      
        	
              	
                (a)

              	
                LESSEE'S
                  failure to pay rent or any other charge under this LEASE within
                  10 days
                  after it is due.

              


      

       

      
        	
              	
                (b)

              	
                LESSEE’S
                  failure to comply with any other term or condition within 10 days
                  following written notice from LESSOR
                  specifying the noncompliance. If such noncompliance cannot be cured
                  within
                  this 10 day period,

              


      

       

      (6)

      LESSOR
        INITIAL 
DL   LESSEE INITIAL  BK 


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      the
        provision shall be satisfied if LESSEE commences correction within such period
        and thereafter proceeds in good faith and with reasonable diligence to effect
        compliance as soon as possible. Time is of the essence in the performance
        of
        this LEASE.

       

      
        	
              	
                (c)

              	
                The
                  making by LESSEE of any general assignment or general arrangement
                  for the
                  benefit of creditors; or the filing
                  by or against LESSEE of a petition to have LESSEE adjudged a bankrupt,
                  or
                  a petition or reorganization or arrangement under any law relating
                  to
                  bankruptcy (unless, in the case of a petition filed against LESSEE,
                  the
                  same is dismissed within sixty (60) days); or the appointment of
                  a trustee
                  or a receiver to take possession of substantially of all LESSEE'S
                  assets
                  located at the Premises or of LESSEE'S interest in this LEASE,
                  where
                  possession is not restored to LESSEE within thirty (30) days; or
                  the
                  attachment, execution, or other judicial seizure of substantially
                  all of
                  LESSEE'S assets located at the Premises or of LESSEE'S interest
                  in this
                  LEASE, where such seizure is not discharged within thirty (30)
                  days.

              


      

       

      
        	
              	
                (d)

              	
                Assignment
                  or subletting by LESSEE in violation of Paragraph
                  16.1.

              


      

       

      
        
          	
                	
                  (e)

                	
                  Vacation
                    or
                    abandonment of the Premises without the written consent of
                    LESSOR.

                


        

      

       

      17.2
        REMEDIES FOR DEFAULT

       

      In
        case
        of default as described in Paragraph 17.1, LESSOR shall have the right to
        the
        following remedies which are intended to be cumulative and in addition to
        any
        other remedies provided under applicable law:

       

      
        	
              	
                (a)

              	
                LESSOR
                  may terminate the LEASE and retake possession of the Premises.
                  Following
                  such retaking of possession,
                  efforts by LESSOR to relet the Premises shall be sufficient if
                  LESSOR
                  follows its usual procedure for finding tenants for the space at
                  rates not
                  less than the current rates for other comparable space in the Building.
                  If
                  LESSOR has other vacant space in the Building, prospective tenants
                  may be
                  placed in such other space without prejudice to LESSOR'S claim
                  to damages
                  or loss of rental from LESSEE.

              


      

       

      
        	
              	
                (b)

              	
                LESSOR
                  may recover all damages caused by LESSEE'S default which shall
                  include an
                  amount equal to rentals
                  lost because of the default, lease commissions paid for this LEASE,
                  the
                  unamortized cost of any tenant improvements installed by LESSOR
                  to meet
                  LESSEE'S special requirements and the cost of any clean up, refurbishing,
                  lock changes and removal of the LESSEE'S property and fixtures.
                  LESSOR may
                  sue periodically to recover damages as they occur throughout the
                  lease
                  term, and no action for accrued damages shall bar a later action
                  for
                  damages subsequently accruing. LESSOR may elect in any one action
                  to
                  recover accrued damages plus damages attributable to the remaining
                  term of
                  the LEASE. Such damages shall be measured based upon the rent due
                  under
                  this LEASE for the remainder of the term, discounted to the time
                  of
                  judgment at the prevailing interest rates on
                  judgments.

              


      

       

      
        	
              	
                (c)

              	
                LESSOR
                  may make any payment or perform any obligation which LESSEE has
                  failed to
                  perform, in whichcase
                  LESSOR shall be entitled to recover from LESSEE upon demand all
                  amounts so
                  expended, plus interest from the date of the expenditure at the
                  rate of
                  one-and-one-half percent (1 1/2%) per month. Any such payment or
                  performance by LESSOR shall not waive LESSEE'S
                  default.

              


      

       

      18.1
        SURRENDER

       

      On
        the
        Expiration Date or early termination of this LEASE, LESSEE shall deliver
        all
        keys to LESSOR to avoid a minimum lock change charge of $150.00 per lock
        and
        surrender the Premises broom clean and in the same condition as at the
        commencement date of the term subject only to reasonable wear from ordinary
        use.
        LESSEE shall remove all of its furnishings and trade fixtures that remain
        its
        property and restore all damage resulting from such removal. Failure to remove
        shall be an abandonment of the property and LESSOR may dispose of it in any
        manner without liability and LESSEE shall pay a reasonable charge for such
        removal and disposal. If LESSEE fails to vacate the Premises when required,
        including failure to remove all its personal property, LESSOR may elect either:
        (1) to treat LESSEE as a tenant from month to month, subject to all the
        provisions of this LEASE except that rent shall be one-and-one-half (1 1/2)
        times the total rent being charged when the lease term expired; or (2) to
        eject
        LESSEE from the Premises and recover damages caused by wrongful holdover.
        During
        the period of sixty (60) days prior to the termination date of this LEASE,
        the
LESSOR may post on said premises or in the windows
        thereof
        signs of appropriate size notifying the public that the premises are "For
        Lease."

       

       

      
        (7)

      

      (7)

      LESSOR
        INITIAL 
DL   LESSEE INITIAL  BK 


       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      19.1
        REGULATIONS

       

      LESSOR
        shall have the right (but shall not be obligated) to make, revise and enforce
        regulations or policies consistent with this LEASE for the purpose of moving,
        use of common areas, prohibiting smoking or promoting safety, health, order,
        economy, cleanliness, and good service to all tenants of the Building. All
        such
        regulations and policies shall be complied with as if part of this
        LEASE.

       

      20.1
        ACCESS

       

      During
        times other than normal Building hours LESSEE'S officers and employees or
        those
        having business with LESSEE may be required to identify themselves or show
        passes in order to gain access to the Building. LESSOR shall have no liability
        for permitting or refusing to permit access by anyone. LESSOR shall have
        the
        right to enter upon the Premises at any time by passkey or otherwise to
        determine LESSEE'S compliance with this LEASE, to perform necessary repairs
        to
        the Building or the Premises, examine the condition of the Premises, to show
        the
        Premises to any prospective tenant or purchasers or for any other lawful
        purpose. Except in the case of emergency, such entry shall be at such times
        and
        in such manner as to minimize interference with the reasonable business use
        of
        the Premises by LESSEE.

       

      21.1
        FURNITURE AND BULKY ARTICLES

       

      LESSEE
        shall move furniture and bulky articles in and out of the Building or make
        independent use of the elevators only at times approved by LESSOR following
        at
        least 24 hours' advance written notice to LESSOR of the intended move. Items
        of
        1,000 pounds or greater shall require LESSOR'S approval.

       

      22.1
        NOTICES

       

      Notices
        between the parties relating to this LEASE shall be in writing, effective
        when
        delivered, or facsimile, or if mailed, effective on the second day following
        mailing, postage prepaid, to the address for the party stated in this LEASE
        or
        to such other address as either party may specify by written notice to the
        other. Notice to LESSEE may always be delivered to the Premises. Rent shall
        be
        payable to LESSOR at the LESSOR'S address and in the same manner, but shall
        be
        considered paid only when received.

       

      23.1
        SUBORDINATION

       

      This
        LEASE shall be subject and subordinate to any mortgages, deeds of trust,
        or land
        sale contracts (hereafter collectively referred to as encumbrances) now existing
        against the Building. At LESSOR'S option this LEASE shall be subject and
        subordinate to any future encumbrance hereafter placed against the Building
        (including the underlying land) or any modifications of existing encumbrances,
        and LESSEE shall execute such documents as may reasonably be requested by
        LESSOR
        or the holder of the encumbrance to evidence this subordination.

       

      24.1
        TRANSFER OF BUILDING

       

      If
        the
        Building is sold or otherwise transferred by LESSOR or any successor, LESSEE
        shall attorn to the purchaser or transferee and recognize it as the LESSOR
        under
        this LEASE, and, provided the purchaser assumes all obligations hereunder,
        the
        transferor shall have no further liability hereunder.

       

      (8)

      LESSOR
        INITIAL 
DL   LESSEE INITIAL  BK 


       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      25.1
        ESTOPPELS

       

      Either
        party will within 20 days after written notice from the other execute,
        acknowledge and deliver to the other party a certificate certifying whether
        or
        not this LEASE has been modified and is in full force and effect; whether
        there
        are any modifications or alleged breaches by any other party; the dates to
        which
        rent has been paid in advance, and the amount of any security deposit, Lease
        Consideration, or prepaid rent; and any other facts that may reasonably be
        requested. Failure to deliver the certificate within the specified time shall
        be
        conclusive upon the party of whom the certificate was requested that the
        lease
        is in full force and effect and has not been modified except as may be
        represented by the party requesting the certificate. If requested by the
        holder
        of any encumbrance, or any ground lessor, LESSEE will agree to give such
        holder
        or LESSOR notice of and an opportunity to cure any default by LESSOR under
        this
        LEASE.

       

      26.1
        ATTORNEYS FEES

       

      In
        any
        litigation arising out of this LEASE, the prevailing party shall be entitled
        to
        recover, in addition to costs and disbursements, attorneys' fees at trial
        and on
        any appeal. If LESSOR incurs attorneys’ fees because of a default by LESSEE,
        LESSEE shall pay all such fees whether or not litigation is filed.

       

      27.1
        QUIET ENJOYMENT

       

      LESSOR
        warrants that so long as LESSEE complies with all terms of this LEASE, it
        shall
        be entitled to peaceable and undisturbed possession of the Premises free
        from
        any eviction or disturbance by LESSOR. Neither LESSOR nor its managing agent
        shall have any liability to LESSEE for loss or damages arising out of the
        acts,
        including criminal acts, of other tenants of the Building or third parties,
        nor
        any liability for any reason which exceeds the value of its interest in the
        Building.

       

      28.1
        COMPLETE AGREEMENT

       

      This
        LEASE and the attached Exhibits and Schedules constitute the entire agreement
        of
        the parties and supersede all prior written and oral agreements and
        representations. Neither LESSOR nor LESSEE is relying on any representations
        other than those expressly set forth herein. There are no implied covenants
        or
        other agreements between the parties except as expressly set forth in this
        LEASE.

       

      29.1
        CHAIR MATS

       

      LESSEE
        shall provide, at LESSEE'S expense, chair mats for all desk rolling chairs
        within the leased space and will be responsible for carpet wear caused by
        chairs
        which could have been avoided by the use of chair mats.

       

      30.1
        PARKING

       

      LESSEE
        shall have the nonexclusive use of eighteen (18) parking spaces
        for every 6,058 useable
        square feet of leased space for the use during normal business hours. LESSOR
        has
        sole control of parking and may designate areas for patrons of the
        property/Building and assign LESSEE and employees of the LESSEE to designated
        parking areas. LESSEE and employees shall park their cars only in these areas
        designated for the purpose by the LESSOR. LESSEE shall furnish to LESSOR
        license
        numbers of vehicles used by the LESSEE and the employees of the LESSEE, and
        notify LESSOR of any changes within five (5) days. If LESSEE or its employees
        fail to park their vehicles in designated parking areas, then LESSOR may
        charge
        LESSEE twenty dollars ($20.00) per day per vehicle for each or partial day,
        in
        any area other than those designated, or if the area is signed as a towing
        area,
        to have the vehicle(s) towed at the LESSOR'S option and at the expense of
        the
        LESSEE and its employees. LESSEE acknowledges and agrees that LESSOR shall
        not
        be responsible for the enforcement of any parking rules or regulations in
        connection with reserved parking spaces contained in this LEASE and/or in
        the
        Building rules.

       

      There
        shall be no overnight storage of vehicles or trailers in the parking areas
        or
        outside of Premises. LESSOR may remove vehicle from property and LESSEE shall
        bear the cost of such removal.

       

      (9)

      LESSOR
        INITIAL 
DL   LESSEE INITIAL  BK 


       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      31.1
        COMMON AREA

       

      Where
        the
        Building has a common entrance or meeting room, the LESSEE may use these
        facilities at no cost on a first-come, first-serve basis by contacting the
        LESSOR and reserving the room in advance. Abusing the privilege of the rooms
        may
        result in the loss of said use.

       

      
        
          	
                  32.1

                	
                  NOTICE
                    TO OWNERS, BUYERS, AND TENANTS REGARDING HAZARDOUS WASTES OR
                    SUBSTANCES
                    UNDERGROUND STORAGE TANKS

                


        

      

       

      Comprehensive
        Federal and State laws and regulations have been enacted in the last few
        years
        in an effort to develop controls over the use, storage, handling, cleanup,
        removal and disposal of hazardous wastes or substances. Some of these laws
        and
        regulations, such as, for example, the so-called "Superfund Act", provide
        for
        broad liability schemes wherein an owner, tenant or other user of the property
        may be liable for cleanup costs and damages regardless of fault. Other laws
        and
        regulations set standards for the handling of asbestos or establish requirements
        for the use, modification, abandonment or closing of underground storage
        tanks.

       

      It
        is not
        practical or possible to list all such laws and regulations in this LEASE.
        Therefore, owners, buyers and tenants are urged to consult legal counsel
        to
        determine their respective rights and liabilities with respect to the issues
        described in this notice as well as all other aspects of the proposed
        transaction. If hazardous wastes or substances have been, or are going to
        be
        used, stored, handled or disposed of on the property, or if the property
        has or
        may have underground storage tanks, it is essential that legal and technical
        advice be obtained to determine, among other things, what permits and approvals
        have been or may be required, if any, the estimated costs and expenses
        associated with the use, storage, handling, cleanup, removal or disposal
        of the
        hazardous wastes or substances and what contractual provisions and protections
        are necessary or desirable. It may also be important to obtain expert assistance
        for site investigations as to the likelihood of hazardous wastes or substances,
        or underground storage tanks being on the property.

       

      Although
        LESSOR will disclose any knowledge it actually possesses with respect to
        the
        existence of hazardous wastes or substances, or underground storage tanks
        on the
        property, LESSOR has not made investigations or obtained reports regarding
        the
        subject matter of this notice, except as may be described in a separate written
        document signed by LESSOR. LESSOR makes no representations regarding the
        existence or nonexistence of hazardous wastes or substances, or underground
        storage tanks on the property. You should contact a professional, such as
        a
        civil engineer, geologist, industrial hygienist or other persons with experience
        in these matters to advise you concerning the property.

       

      The
        term
        "hazardous wastes or substances" is used in this notice in its very broadest
        sense and includes, but is not limited to petroleum base products, paints
        and
        solvents, lead cyanide, DDT, printing inks, acids, pesticides, ammonium
        compounds, asbestos, PCBs and other chemical products. Hazardous wastes or
        substances and underground storage tanks may be present on all types of real
        property. This notice is therefore meant to apply to any transaction involving
        any type of real property, whether improved or unimproved.

       

      33.1
        MODIFICATION

       

      This
        LEASE may not be modified except by endorsement in writing attached to this
        LEASE, dated and signed by all the parties hereto, and LESSOR shall not be
        bound
        by any oral or written statement of any servant, agent, or employee modifying
        this LEASE.

       

      34.1
        PARTIES AFFECTED

       

      The
        rights, liabilities and remedies provided for herein shall extend to the
        heirs,
        legal representatives, successors and, so far as the terms of this LEASE
        permit,
        assigns of the parties hereto, and the words

       

      (10)

      LESSOR
        INITIAL 
DL   LESSEE INITIAL  BK 


       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      "LESSOR"
        and "LESSEE" and their accompanying verbs or pronouns, wherever used in this
        LEASE, shall apply equally to all persons, firms, or corporations which may
        be
        or become parties hereto.

       

      35.1
        SECURITY

       

      LESSEE
        and not LESSOR, is responsible for security of the Premises. Any breach in
        security of the Premises, common areas, common access doors, and/or elevators
        shall not constitute an eviction of the LESSEE or relieve LESSEE from any
        of
        LESSEE'S obligations under this LEASE. All tenants shall have the responsibility
        for maintaining the security to common access. LESSOR may modify the type
        or
        amount of security measures or services provided to the Building or the Premises
        at any time without notice.

       

      Access
        during times other than normal building hours as stated in Section 8.1 of this LEASE,
        will be
        through the use of an access code issued to each individual. Access codes
        will
        be issued by written instruction of the LESSEE to the management company.
        LESSEE
        is responsible to notify the management company upon an employee leaving
        the
        company and no longer having access to the Building. LESSOR reserves the
        right
        to modify or change the security procedures used for the Building.

       

      36.1
        RIGHT TO RELOCATE

       

      LESSOR
        hereby reserves the right at any time during the term hereof to change the
        location of the Premises in the Building or other acceptable property as
        may be
        required. In the event LESSOR elects to exercise the foregoing option it
        shall
        advise LESSEE with sixty (60) days prior written notice of its intention.
        If
        LESSEE does not accept relocation space this LEASE will terminate at end
        of
        sixty (60) day notice period. LESSEE hereby agrees to be bound by its election
        to relocate or terminate this LEASE and, further, to execute upon receipt
        from
        LESSOR, whatever amendments or other instruments may be required to correctly
        reflect the foregoing changes and/or alterations. LESSOR shall relocate LESSEE
        at LESSOR'S sole expense. LESSEE shall be relocated to a premise of like
        kind
        and quality.

       

      37.1
        BASE RENTAL SCHEDULE

       

      The
        LESSEE agrees to pay Base Rent based upon the following Rent Schedule:


       

      
        
          	
                  
                  

                  Base
                    Rental
                    Period

                	
                  
                  

                  Base
                    Rental Per
                    Month

                
	
                  
                  

                  Commencement
                    Date through the last day of full

                	 
	
                  
                  

                  calendar
                    month twelve (12) of the LEASE term.

                	
                  
                  

                  $10,740.79

                
	 	 
	
                  
                  

                  The
                    first day of full calendar month thirteen (13) through the

                  last
                    day of full calendar month twenty four (24) of

                  
                    the
                      LEASE term.

                  

                	
                  $11,063.01

                
	
                  
                  

                   

                	
                  
                  

                   

                
	
                  
                  

                  The
                    first day of full calendar month twenty five (25) through

                  the
                    last day of full calendar month thirty six (36) of

                  
                    the
                      LEASE term.

                  

                	
                  $11,394.90

                
	
                  
                  

                   

                	
                  
                  

                   

                


        

      

       

       

      37.2
        UTILITY ADJUSTMENT

       

      LESSEE
        shall pay as Additional Rent, one (1) time per year, LESSEE’S proportionate
        share of any increase in basic utility costs for the Building.

       

      The
        base
        period shall be September
        2005 through August,
        2006, during which time the actual utility costs were $TBD. The comparison
        period
        shall be defined as the twelve calendar month period directly following the
        base
        period and every consecutive twelve calendar month period thereafter. The
        actual
        utility costs shall be defined as all Building meter accounts paid by the
        LESSOR. For the purposes of the utility adjustment, the Utility Building
        size
        shall be the actual useable square feet less any space separately metered
        or
        submetered or 41,517
        square feet and the LESSEE’S pro-rata share is 14.6% which is based
        on the
        actual Premises useable

       

      (11)

      LESSOR
        INITIAL 
DL   LESSEE INITIAL  BK 


       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      square
        feet divided by the Utility Building size. Since the useable square feet
        of the
        Building can change, the above Utility Building size and LESSEE’S pro-rata share
        is subject to change.

      The
        one (1) time per year utility payment, if any, shall be paid by the LESSEE
        annually beginning month thirteen (13) of the LEASE term on the first day
        of
        this month.

       

      First,
        before any comparison of utility costs is made, the base period actual utility
        costs shall be increased by the CPI percentage change using the base period
        CPI
        compared to the comparison period CPI to create an “adjusted” base amount. Next,
        the “adjusted” base amount shall be subtracted from the comparison period actual
        utility costs. Last, the difference shall be multiplied by the LESSEE’S pro-rata
        share. The one (1) time
per
        year utility
        payment, if any, shall be paid by the LESSEE annually beginning month thirteen
        (13) of the LEASE term on the first day of this month.

       

      An
        example is as follows:

       

      Example

       

      
        
          	
                  
                  

                  1.)

                	
                  
                  

                  Actual
                    Building Size

                	
                  
                  

                  20,000
                    useable sq. ft.

                
	
                  
                  

                  2.)

                	
                  
                  

                  Building
                    Tenants who pay their utilities direct on separate meters or
                    separately
                    read submeters

                	
                  
                  

                  2,500
                    useable sq. ft.

                
	
                  
                  

                  3.)

                	
                  
                  

                  Adjusted
                    Building Size

                	
                  
                  

                  17,500
                    useable sq. ft.

                
	
                  
                  

                  4.)

                	
                  
                  

                  LESSEE’S
                    Premises =

                	
                  
                  

                  1,000
                    useable sq. ft.

                
	
                  
                  

                  5.)

                	
                  
                  

                  LESSEE’S
                    pro-rata share =

                	
                  
                  

                  5.7%

                
	
                  
                  

                  6.)

                	
                  
                  

                  Actual
                    Utility Costs during Base Period for
                    Entire Building

                	
                  
                  

                  $17,500.00
                    ($1.00/rsf/yr)

                
	 	
                  
                  

                  Base
                    Period CPI ....183.5 (May 2003)

                	 
	 	
                  
                  

                  Comparison
                    Period CPI........ 194.4 (May 2005)

                	 
	
                  
                  

                  7.)

                	
                  
                  

                  CPI
                    Percentage Increase

                	
                  
                  

                  x  5.9%

                
	
                  
                  

                  8.)

                	
                  
                  

                  “Adjusted”
                    Base Amount

                	
                  
                  

                  $18,532.50

                
	
                  
                  

                  9.)

                	
                  
                  

                  Actual
                    Utility Costs during Comparison Period for Entire Building

                	
                  
                  

                  $19,600.00
                    (12%increase)

                
	
                  
                  

                  10.)

                	
                  
                  

                  Difference
                    between Comparison Period Actual Utility Costs and “Adjusted” Base
                    Amount

                	
                  
                  

                  $
                    1,067.50

                
	
                  
                  

                  11.)

                	
                  
                  

                  Tenant’s
                    annual Pro-rata Share 5.7% or $60.85, which is a one (1) time
                    per year
                    payment made by the LESSEE

                	 


        

      

       

       

      38.1
        SMOKING - ENTIRE NON-SMOKING BUILDING

       

      The
        Building in which the Premises is located has been designated as an entire
        NON-SMOKING Building. This includes all areas of the Building, both common
        areas
        as well as individual tenant spaces. Thus, smoking in the Premises or common
        areas within the Building is not permitted.

       

      39.1
        WAIVER

       

      Any
        waiver by the LESSOR of any breach of any covenant herein contained to be
        kept
        and performed by the LESSEE shall not be deemed or considered as a continuing
        waiver, and shall not operate to bar or prevent the LESSOR from declaring
        a
        forfeiture for any succeeding breach, either of the same condition or covenant
        otherwise.

       

      40.1
        PERSONAL GUARANTEE

       

      See
        Exhibit "A"

       

      X None
        Required

       

      41.1
        INTERIOR DESIGN & MODIFICATION

       

      (12)

      LESSOR
        INITIAL 
DL   LESSEE INITIAL  BK 


       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      See
        Exhibit "B" Space Plan, Exhibit “B” Space Plan/”A”

       

      42.1
        LESSOR AGREED TENANT IMPROVEMENTS

       

      See
        Exhibit "C" Interior Space Work Agreement

       

      If
        any
        provisions contained in this Exhibit “C” Interior Space Work Agreement are
        inconsistent with any other provisions contained in this LEASE (ie: Exhibit
“B”
Space Plan), the provisions contained in this Exhibit “C” Interior Space Work
        Agreement shall control.

       

      43.1
        LESSEE TENANT IMPROVEMENTS OR ALTERATIONS

       

      
        	
              	
                (a)

              	
                The
                  LESSOR must review and approve in writing any LESSEE Tenant Improvements
                  or Alterations to the Premises.
                  The LESSOR requests a walk-through with LESSEE and LESSEE’S contractor
                  prior to commencement of any improvements by LESSEE to the
                  Premises.

              


      

       

      
        	
              	
                (b)

              	
                The
                  LESSEE shall be responsible for all Tenant Improvements or Alterations
                  to
                  the Premises not performed by
                  the LESSOR and all costs associated with said LESSEE Tenant Improvements
                  or Alterations. Said Tenant Improvements or Alterations are to
                  comply with
                  applicable building (including Americans With Disabilities Act,
                  or ADA)
                  and fire codes and are to be performed by licensed and bonded contractor
                  with a building permit from the City of Portland or the appropriate
                  governmental agency. Prior to the commencement of work, LESSEE’S general
                  contractor shall provide LESSOR proof of insurance indemnifying
                  LESSOR for
                  claims that may arise during the course of Tenant Improvements
                  or
                  Alterations. All tenant improvements performed by LESSEE shall
                  have prior
                  written approval by LESSOR using materials of quality satisfactory
                  to
                  LESSOR. LESSEE shall provide construction drawings, which will
                  be attached
                  to the LEASE as Exhibit “D” and approved by LESSOR in writing prior to
                  commencement of LESSEE tenant
                  improvements.

              


      

       

      
        	
              	
                (c)

              	
                The
                  LESSEE will be responsible for all costs associated with LESSEE
                  Tenant
                  Improvements or Alterations.

              


      

       

      
        	
              	
                (d)

              	
                LESSEE
                  to appoint one (1) person as a LESSEE representative project manager
                  regarding all LESSEE Tenant Improvement
                  or Alterations coordination. LESSOR will only interface with that
                  person.

              


      

       

      
        	
              	
                (e)

              	
                Before
                  commencing any Tenant Improvements or Alterations using LESSEE
                  outside
                  contractors, LESSEE shall
                  notify LESSOR of the expected commencement and completion dates
                  of the
                  LESSEE tenant improvement work. LESSEE shall not permit any mechanics’ or
                  materials’ liens to be levied against the Premises or the Building for any
                  labor or materials furnished to LESSEE or its agents or contractors;
                  provided, however, that LESSEE shall not be required to pay or
                  otherwise
                  satisfy any claims or discharge such liens so long as LESSEE, in
                  good
                  faith and at its own expense, contests the same or the validity
                  thereof by
                  appropriated proceedings and posts a bond or takes other steps
                  acceptable
                  to LESSOR that stay enforcement of such
                  lien.

              


      

       

      
        	
              	
                (f)

              	
                LESSEE
                  agrees that there shall be no occupancy of the Premises by LESSEE
                  until
                  any/all notices of mechanics’
                  liens are removed from the property and LESSOR is in receipt of
                  lien
                  waivers from all trades for LESSEE Tenant Improvements or
                  Alterations.

              


      

       

      
        	
              	
                (g)

              	
                Prior
                  to commencement of any LESSEE Tenant Improvements or Alterations
                  to the
                  Premises, LESSOR shall require
                  LESSEE to have their General Contractor provide LESSOR with proof
                  of
                  Performance and Payment bond acceptable to the LESSOR listing LESSOR
                  as an
                  Obligee.

              


      

       

      
        	
              	
                (h)

              	
                LESSOR
                  also requires LESSEE’S construction agreement with LESSEE’S general
                  contractor for the Premises
                  to include a waiver of any right to lien against the LESSOR’S property and
                  a statement that the General Contractor’s only resource is the LESSEE and
                  not the LESSOR for any payments related to the improvements of
                  the
                  Premises.

              


      

       

      
        	
              	
                (i)

              	
                Upon
                  completion of LESSEE’S Tenant Improvements or Alterations per the
                  construction documents (to beattached
                  to LEASE prior to construction start) approved by LESSOR, LESSOR’S
                  inspection of the completed said Tenant Improvements or Alterations,
                  and
                  LESSEE supplying a full set of lien
                  releases.

              


      

       

      (13)

      LESSOR
        INITIAL 
DL   LESSEE INITIAL  BK 


       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

       

      
        	
              	
                (j)

              	
                All
                  materials shall be installed in a good workmanship manner, and
                  quality.

              


      

       

      
        	
              	
                (k)

              	
                All
                  LESSEE Tenant Improvements or Alterations will need to be routed
                  through
                  the Facilities Permit Programwith
                  the City of Portland if the Building is located within the city
                  limits of
                  Portland. All associated charges will be billed to the LESSOR and
                  passed
                  through to the LESSEE for payment upon receipt. LESSEE is aware
                  all
                  inspections and associated fees generated by LESSEE or LESSEE’S contractor
                  will be paid by the LESSEE. All reinspections associated with LESSEE’S
                  Tenant Improvements or Alterations will be paid by
                  LESSEE.

              


      

       

      
        	
              	
                (l)

              	
                The
                  LESSEE may not occupy the Premises until LESSOR is in receipt of
                  a copy of
                  a Certificate ofOccupancy.
                  (This only applies to initial Tenant
                  Improvements)

              


      

       

      44.1
        FLOOR PLAN

       

      See
        Exhibit “E” Floor Plan

       

      45.1
        TELEPHONES

       

      LESSEE
        agrees, at its expense, to provide voice and data wiring to the Premises
        and
        appropriate common areas. LESSEE agrees to put any equipment associated with
        LESSEE’S voice and data system in the Premises. LESSEE agrees that LESSOR shall
        not be liable for any damages or other liability incurred by LESSEE or any
        other
        parties as a result of LESSEE'S wiring the Premises for voice and data or
        the
        existing condition of any voice and data wiring or system. LESSEE further
        agrees
        to indemnify and hold harmless LESSOR from any and all liability or claims
        of
        LESSEE or others arising or resulting from LESSEE'S wiring of the Premises
        for
        voice and data communications. The LESSEE agrees to have LESSEE’S voice/data
        vendor obtain a low voltage permit and coordinate Building access and
        installation with the LESSOR.

       

      The
        LESSOR will agree to remove all existing voice and data lines/wiring prior
        to
        Commencement Date if LESSEE so requests in Exhibit “C” prior to LESSEE signing
        this LEASE. If LESSEE does not request in Exhibit “C” that LESSOR remove all
        existing voice and data lines/wiring, then LESSEE shall be responsible for
        any
        removal required.

       

      If
        LESSEE
        decides to use any of the existing voice and data lines/wiring, the LESSOR
        will
        not be responsible for removing any existing voice and data
        lines/wiring.

       

      46.1
        TIME IS OF THE ESSENCE

       

      LESSOR
        and LESSEE acknowledge that time is of the essence in the execution of this
        LEASE in order to allow LESSOR adequate time to complete the agreed upon
        Tenant
        Improvements. Due to the extent of tenant improvements described in Exhibit
“B”
Space Plan and Exhibit “C” Interior Space Work Agreement, the LESSOR’S
        contractor may require up to sixty (60) days after LESSOR
        is in receipt of a permit in order to complete said improvements. If the
        LEASE
        is not signed, returned (with Security Deposit and prepaid rent) and accepted
        by
        the LESSOR before 12:00 noon September 8, 2006, then LESSEE
        understands that the Tenant Improvements described in Exhibit "B" Space Plan
        and
        Exhibit "C" Interior Space Work Agreement may not be completed by the Lease
        Commencement date and LESSEE shall not take possession of Premises until
        said
        Tenant Improvements are completed.

       

      47.1
        EXPIRATION OF OFFER

       

      This
        offer to lease shall be null and void at the sole option of the LESSOR if
        not
        returned to LESSOR signed by LESSEE in an acceptable form to LESSOR and
        accompanied by appropriate funds by September 8,
        2006.

       

      48.1
        RENT CONCESSION

       

      LESSEE
        shall receive a rent concession valued at $21,481.60 to be applied as a rent
        credit of $5,370.40 for months two (2), three (3), four (4) and five (5)
        of the
        initial LEASE term only.

       

      (14)

      LESSOR
        INITIAL 
DL   LESSEE INITIAL  BK 


       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

       

      In
        construing of this LEASE, it is understood that the LESSOR or the LESSEE
        may be
        more than one person; that if the context so requires, the singular pronoun
        shall be taken to mean and include the plural, the masculine, the feminine,
        and
        the neuter, and that generally all grammatical changes shall be made, assumed
        and implied to make the provisions hereof apply equally to corporations and
        to
        individuals.

       

      IN
        WITNESS WHEREOF, the
        respective parties have executed this instrument in duplicate on this, the
        day,
        the month, and year first hereinbelow written, any corporation signature
        being
        by authority of its Board of Directors.

       

      
         

        
          
            	
                    
                    

                    LESSOR:

                  	
                    
                    

                    By:   /s/
                      Douglas D.
                      Lindholm                
                      

                  
	
                    
                    

                    AMERICAN
                      PROPERTY MANAGEMENT CORP.

                  	
                    
                    

                    Name:
                      Douglas D. Lindholm

                  
	
                    
                    

                    as
                      agent for and on behalf of WESTON INVESTMENT CO. LLC

                  	 
	 	 
	
                    
                    

                    (Federal
                      Tax ID# 93-1173413*)

                  	
                    
                    

                    Title:
                      Vice President of Commercial Property

                  
	
                    *Lessee
                      need not supply Lessor a Federal 1099 Form

                  	 
	
                    Address
                      for Notices:

                  	 
	
                    
                    

                    P.O.
                      Box 12127

                  	
                    
                    

                    DATE:    9/13/06 
                      

                  
	
                    
                    

                    Portland,
                      Oregon 97212-0127

                  	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	
                    
                    

                    LESSEE:

                  	 
	
                    
                    

                    Rim
                      Semiconductor Company, a Utah corporation

                  	 
	
                    
                    

                     

                  	
                    By: 
                      /s/ Brad
                      Ketch                         
                      

                  
	 	 
	 	
                    
                    

                    Name:
                      Brad
                      Ketch

                  
	 	 
	
                    
                    

                    Address
                      for Notices:

                  	
                    
                    

                    Title:
                      President
                      and
                      CEO

                  
	
                    305
                      NE 102nd
                      Avenue, Suite 350

                  	 
	
                    
                    

                    Portland,
                      OR 97220

                  	 
	 	
                    DATE: 
                      9-7-06                        
                      

                  


          

        

         

         

      

      LESSOR
        INITIAL 
DL   LESSEE INITIAL  BK 


       

      (16)

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      EXHIBIT
        "B" SPACE
        PLAN

      Rim
        Semiconductor Company, a Utah
        corporation

      305
        NE 102ndAvenue,
        Suite 350

      Portland,
        OR 97220

      Account
        #C-321-5220-02

       

       

      

       

      Any
        changes to this Exhibit "B" Space
        Plan are subject to LESSOR'S approval. Any changes to this plan shall be
        at
        LESSEE'S sole
        cost and expense, shall not delay
        the Commencement Date, and may delay LESSEE'S occupancy.

       

      If
        any provision contained in Exhibit
“C”Interior
        Space Work Agreement is
        inconsistent with any other provision contained in this LEASE (ie: Exhibit
“B”SpacePlan),
        the provisions contained in
        Exhibit “C”Interior
        Space Work Agreement shall
        control.

       

      (17)

      LESSOR
        INITIAL  DL   LESSEE
        INITIAL  BK 


       

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

       

      EXHIBIT
        "B" SPACE PLAN/”A”

      Rim
        Semiconductor Company, a Utah corporation

      305
        NE 102nd
        Avenue,
        Suite 350

      Portland,
        OR 97220

      Account
        #C-321-5220-02

       

      

       

      (18)

      LESSOR
        INITIAL 
DL   LESSEE INITIAL  BK 


       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

       

      EXHIBIT
        "C" INTERIOR SPACE WORK AGREEMENT

      LESSEE:
        Rim Semiconductor Company,
        a
        Utah corporation

      ACCOUNT
        #C-321-5220-02              
BUILDING/SUITE #:
Multnomah
        Plaza/#350

       

      
        
          	 	
                  
                  

                  ACCEPTED

                	
                  
                  

                  AGREED

                	
                  
                  

                  LESSOR

                	
                  
                  

                  LESSEE

                
	
                  ITEM

                	
                  AS-IS

                	
                  IMPROVEMENTS

                	
                  EXPENSE

                	
                  EXPENSE

                
	
                  PAINTING:

                  (Building
                    Standard Color)

                	 	
                  Repaint
                    Premises using building
                    standard materials. Remaining Vaughan walls that have non fabric
                    wall covering will be painted and those walls with fabric wall
                    covering
                    will remain

                  “as
                    is”. 

                  Color
                    to be: Ivory #462100KM

                	
                  X

                	 
	
                  
                  

                  FLOORCOVERING:

                  (Building
                    Standard Direct Glue
                    DownCarpet,
                    Color/Cove Base Color)

                  
                  

                	 	
                  Recarpet
                    Premises using building standard materials.

                  Color
                    to be: See items 11 and 12 below

                  Cove
                    base to be: See items 11 and 12 below

                	
                  
                  

                  X

                  
                  

                	 
	
                  
                  

                  VINYL
                    FLOORCOVERING

                  (Building
                    Standard
                    Vinyl):

                  
                  

                	
                  
                  

                  X

                  
                  

                	
                  
                  

                  NONE

                  
                  

                	 	 
	
                  
                  

                  LIGHTING:

                  (Building
                    Standard Fixtures and Distribution)

                	 	
                  
                  

                  Replace
                    burned out light bulbs.

                	
                  
                  

                  X

                	 
	
                  
                  

                  ELECTRICAL:

                  (Building
                    Standard 110 Volt)

                	 	
                  
                  

                  Install
                    one (1) duplex for
                    every 12 lineal feet of new construction only. See items 7 and 9
                    below

                	
                  
                  

                  X

                	 
	
                  CEILING:

                  (Building
                    Standard Acoustical Tile)

                	 	
                  Replace
                    up to six (6) damaged ceiling tiles and repaint vents.

                	
                  X

                	 
	
                  
                  

                  PARTITIONS:

                  (Building
                    Standard Sheetrock)

                	 	
                  
                  

                  Demo
                    and build office walls and demising walls

                  as
                    shown on Exhibit :B” Space Plan/”A”.

                	
                  
                  

                  X

                	 
	
                  DOORS/FRAMES:

                  (Building
                    Standard Quality)

                	 	
                  Install
                    double glass doors and two (2) glass inset

                  side
                    light and two (2) glass relites and two (2) exit

                  doors
                    as shown on Exhibit `B” Space Plan/”A”.

                  LESSEE
                    to pay $15,000 for up charge to glass

                  doors,
                    see item 2 below.

                	
                   

                	
                  X

                  LESSEE
                    to pay $15,000 up-front up charge

                
	
                  
                  

                  LOCKS/HARDWARE:

                  (Building
                    Standard Quality)

                  
                  

                	 	
                  
                  

                  All
                    interior doors are to be
                    supplied with passage doorknobs only (no locks), except as shown on
                    Exhibit B” Space Plan/”A”.

                  LESSOR
                    to provide 30 suite entry door keys.

                  LESSOR
                    to provide 20 Building entry keys

                  LESSOR
                    to provide 3 mailbox keys.

                  LESSOR
                    to provide 8 internal keys for four (4)

                  offices
                    as shown on Exhibit `B” Space Plan.

                  
                  

                	
                  
                  

                  X

                  
                  

                	 
	
                  RELIGHTS:

                  (Building
                    Standard Interior)

                	
                  X

                	
                  Install
                    two (2) building standard relites (34” x

                  76”)
                    horizontally in computer room as shown on

                  Exhibit
                    `B” Space plan, See item 4 below.

                	 	 
	
                  WINDOWCOVERING:

                  (Building
                    Standard Exterior)

                  
                  

                	
                   

                	
                   Clean
                    and repair as
                    necessary.

                	
                  X

                	 


        

      

       

       

      (19)

      LESSOR
        INITIAL 
DL   LESSEE INITIAL  BK 


       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

       

      EXHIBIT
        "C" INTERIOR SPACE WORK AGREEMENT (Continued)

      LESSEE:
        Rim Semiconductor Company,
        a
        Utah corporation

      ACCOUNT
        #C-321-5220-02         
BUILDING/SUITE #:
Multnomah
        Plaza/#350

       

       

      
        
          	 	
                  
                  

                  ACCEPTED

                	
                  
                  

                  AGREED

                	
                  
                  

                  LESSOR

                	
                  
                  

                  LESSEE

                
	
                  ITEM

                	
                  AS-IS

                	
                  IMPROVEMENTS

                	
                  EXPENSE

                	
                  EXPENSE

                
	
                   

                	 	 	 	 
	
                  
                  

                  TELEPHONE:

                  (Building
                    Standard Mud Rings)

                	 	
                  
                  

                  Install
                    one (1) mud-ring for every 12 lineal feet of new construction
                    only.

                	
                  
                  

                  X

                	 
	 	 	
                   

                	 	 
	
                  EXISTING
                    VOICE AND

                  DATA
                    LINES:

                	
                  X

                	
                  Remove
                    all existing voice and data lines/wiring.

                  ___
                    YES X  NO

                	 	 


        

      

       

      If
        LESSEE
        is modifying the existing space layout, or expanding their Premises, it is
        understood and agreed that all Lessor Agreed Tenant Improvement work may
        be
        performed during normal business hours and will not be deemed as an interruption
        of LESSEE'S business and that AMERICAN PROPERTY MANAGEMENT CORP. assumes
        no
        liability for damage to any existing hidden electrical located in the walls,
        ceiling and/or floors (i.e., electrical for phones, fax, computers, office
        equipment, etc.) that is not indicated on this agreement and brought to the
        attention of AMERICAN PROPERTY MANAGEMENT CORP. prior to the office remodel
        or
        is not equipped with an appropriate power surge protection device. If any
        provisions contained in this Exhibit “C” Interior Space Work Agreement are
        inconsistent with any other provisions contained in this LEASE (ie: Exhibit
“B”
Space Plan), the provisions contained in this Exhibit “C” Interior Space Work
        Agreement shall control.

       

      The
        following will be incorporated into this Exhibit “C”:

       

      
        	
              	
                (2)

              	
                The
                  Lessor will agree to install glass double doors with glass inset
                  sidelights and glassrelites
                  as drawn in Exhibit “B” Space
                  Plan/A.

              


      

       

      
        The
          LESSEE shall pay $15,000.00 for this cost as an up front estimated up charge.
          The Lessor will have Benson Glass provide a hard bid for this work and
          the work
          described in (14).

        


      

      
        	
              	
                (3)

              	
                The
                  Lessor will build building standard partitions where indicated
                  in orange
                  highlight on the RIM plan by B. Anderson
                  as drawn in Exhibit “B” Space Plan/”A” (“E”) at no cost
                  to the
                  Lessee. All other partitions described in this plan will be built
                  by Lessee’s contractor (approved by Lessor) after the Lessor completes
                  Lessor’s work and tenders possession of the Premises to the Lessee per
                  Section 43.1 of the LEASE.

              


      

       

      
        	
              	
                (4)

              	
                The
                  Lessor will build at not
                  cost to
                  Lessee, building standard partitions and install a building
                  standard door with two (2)
                  building standard (“timely framed”) 34” x 76” horizontal relites where
                  indicated on Exhibit “B” Space Plan
                  (“B”).

              


      

       

      
        	
              	
                (5)

              	
                The
                  Lessor will only “flip” the closet described in Exhibit “B” Space Plan
                  (“B”) if there is no mechanical in the existing
                  wall that will have the new closet opening, at no
                  cost to
                  Lessee. Other wise the closet will remain as
                  is.

              


      

       

      
        	
              	
                (6)

              	
                The
                  Lessor will provide at no
                  cost to
                  Lessee, four (4) internal lock sets and provide eight (8) sets
                  of
                  identical keys.

              


      

       

      
        	
              	
                (7)

              	
                The
                  Lessor will install halogen can lights on separate dimmer switches
                  or
                  independent switches in five (5) areas described
                  in Exhibit “B” Space Plan/A (“C”).

              


      

      
         

        The
          Lessee shall pay for all costs associated with this work. The Lessor will
          pass
          through the actual time and material costs associated with the Lessor’s
          subcontractors work. No supervision, overhead or profit will be added.
          The
          Lessee will agree not to delay the Lessor in providing can light
          specifications.

      

       

      
        	
              	
                (8)

              	
                The
                  Lessor will install the j boxes to the five (5) areas described
                  in Exhibit
                  “B” Space Plan/A.

              


      

      
         

        The
          Lessee shall pay for all costs associated with this work. The Lessor will
          pass
          through the actual time and material costs associated with the Lessor’s
          subcontractors work. No supervision overhead or profit will be added. The
          Lessee
          will agree not to delay the Lessor in providing specifications for this
          work.

      

       

      (20)

      LESSOR
        INITIAL 
DL   LESSEE INITIAL  BK 


       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      
        
          	
                	
                  (9-11)

                	
                  The
                    Lessor shall install a new 3.5-ton split system HVAC unit which
                    will
                    provide 24/7 cooling to the room described in Exhibit `B” Space Plan
                    (`B”). The Lessor will not relocate the existing unit in Suite 103,
                    as it
                    is 15-20 years old. The new HVAC equipment will be capable of
                    cooling up
                    to 64 servers at 300 watts
                    each.

                


        

      

       

      A
        new
        electric panel will need to be installed. The new electric panel will support
        the HVAC system and the eight (8) twenty (20) amp circuits for the j boxes
        located in the room described in Exhibit `B” Space Plan (`B”). The new electric
        panel will be put on a submeter. The Lessee will be responsible for the submeter
        reading cost and all utility costs associated with this new electric panel.
        The
        Lessee will be responsible for servicing and maintaining this HVAC unit.
        The
        Lessor advises Lessee to enter into a service contract with the company that
        installs the equipment.

      
         

        The
          Lessee will pay for the above work upfront, at a cost not to exceed
          $12,500.00.

      

       

      
        	
              	
                (12)

              	
                The
                  Lessor will install the described carpet at no cost
                  to the
                  Lessee. Lessee to choose new cove base color as it is now
                  discontinued. (Color to be:
                  #96591/Escape)

              


      

       

      
        	
              	
                (13)

              	
                The
                  Lessor will install the described carpet at no
                  cost to the
                  Lessee. Lessee to choose new cove base color as it is now
                  discontinued. (Carpet color to be: #525/Bulletin Board) (Cove base
                  color
                  to be: )

              


      

       

      
        	
              	
                (14)

              	
                The
                  Lessor will provide three (3) 12” high horizontal relites of equal size in
                  front of the three (3) skylights in thecommon
                  hall, as shown on Exhibit `B” Space
                  Plan/”A-2”.

              


      

       

      
        The
          Lessee will be responsible for all associated costs. Benson Glass will
          provide
          hard bids, and Lessee will agree to pay the Lessor within three (3) business
          days of Lessee’s receipt of a hard bid for this work, which will be in addition
          to the $15,000.00 estimate described in item (2) above.

         

        
           

          
            	DL
                    BK	
                    (15)

                  	
                    The
                      Lessor will install linoleum or tile flooring in the highlighted
                      area on
                      Exhibit "B" Space Plan

                  


          

        

         

         

        
          
            	DL 
                    BK	
                    (16)

                  	
                    The
                      Lessor will move the wall indicated on Exhibit "B" Space Place
                      Plan to be
                      flush with the office wall directly east of the office.

                  




        

      

      (21)

      LESSOR
        INITIAL 
DL   LESSEE INITIAL  BK 


       

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      EXHIBIT
        "E” FLOOR PLAN

      Rim
        Semiconductor Company, a Utah corporation

      305
        NE 102nd
        Avenue,
        Suite 350

      Portland,
        OR 97220

      Account
        #C-321-5220-02

       

      
      

      
        	
                

              	
                 

                 

                 

                 

                 

                 

                 

                 

                 

                 

                 

                 

                 

                ==
                  Premises

              


      

       

      The
        above
        Floor Plan is meant to show the approximate location of the Premises in relation
        to the rest of the floor only. It may not show an accurate as-built drawing
        and
        is not meant for tenant improvement purposes.

       

      (22)

      LESSOR
        INITIAL 
DL   LESSEE INITIAL  BK