AIR
                COMMERCIAL REAL ESTATE ASSOCIATION

            
	 	
              STANDARD
                INDUSTRIAL/COMMERCIAL

              MULTI-TENANT
                LEASE - GROSS

            


    

    


    1. Basic
      Provisions (“Basic Provisions”).

    


    1.1 Parties:
      This
      Lease (“Lease”),
      dated
      for reference purposes only  January
      31, 2005   ,
      is made
      by and between  AGA
      Partners  (“Lessor”)
      and  The
      Vinyl Fence Company, Inc.    (“Lessee”),
      (collectively the “Parties”,
      or
      individually a Party”).

    


    1.2(a)
      Premises:
      That
      certain portion of the Project (as defined below), including all improvements
      therein or to be provided by Lessor under the terms of this Lease, commonly
      known by the street address of  2210
      S. Ritchey Street   ,
      located
      in the City of  Santa
      Ana   ,
      Country
      of  Orange  ,
      State
      of  California 
      ,
      with
      zip code  92705  
      ,
      as
      outlined on Exhibit A
      attached
      hereto (“Premises”)
      and
      generally described as (describe briefly the nature of the
      Premises):   Approximately
      9,500* square feet of industrial office and warehouse space, part of a larger
      22,600 square foot free standing building   .

     

    In
      addition to Lessee’s rights to use and occupy the Premises as hereinafter
      specified, Lessee shall have non-exclusive rights to any utility raceways of
      the
      building containing the Premises (“Building”)
      and to
      the Common Areas (as defined in Paragraph 2.7 below), but shall not have any
      rights to the roof, or exterior walls of the Building or to any other buildings
      in the Project. The Premises, the Building, the Common Areas, the land upon
      which they are located, along with all other buildings and improvements thereon,
      are herein collectively referred to as the “Project.”
      (See
      also Paragraph 2)

    


    1.2(b) Parking:  
      2:1  
       unreserved
      vehicle parking spaces. (See also Paragraph 2.6.)

    


    1.3 Term:  
      Four
      (4)    years
      and   -0-  
       months
      (“Original
      Term”)
      commencing   April
      1, 2005 or upon completion of Tenant Improvements   
 (“Commencement
      Date”)
      and
      ending   TBD  
       (“Expiration
      Date”).
      (See
      also Paragraphs 3)

    


    1.4 Early
      Possession:  
      N/A  
       (“Early
      Possession Date’).
      (See
      also Paragraphs 3.2 and 3.3)

    


    1.5 Base
      Rent:
      $7,980.00  
       per
      month (“Base
      Rent”),
      payable
      on the 1st   
       day
      of each month commencing   April
      1, 2005 or upon completion of Tenant Improvements   
.
      (See
      also Paragraph 4)

    


    þ If
      this
      box is checked, there are provisions in this Lease for the Base Rent to be
      adjusted.

    


    1.6
      Lessee’s share of Common Area Operating Expenses:  
      forty-two  
       percent
      ( 42  
      %)
      (“Lessee’s
      Share”).
      Lessee’s Share has been calculated by dividing the approximate square footage of
      the Premises by the approximate square footage of the Project. In the event
      that
      that size of the Premises and/or the Project are modified during the term of
      this Lease, Lessor shall recalculate Lessee’s Share to reflect such
      modification.

    


    1.7
      Base
      Rent and Other Monies Paid Upon Execution:

    


    (a)
      Base
      Rent:
      $  7,980.00   
       for
      the period   covering
      first month’s rent    .

     

    (b)
      Common
      Area Operating Expenses:
      $ TBD  
       for
      the period   covering
      first month’s rent    .

     

    (c)
      Security
      Deposit:
      $   8,690.00    (“Security
      Deposit”).
      (See
      also Paragraph 5)

     

    (d)
      Other:
      $  10,000.00    
       for  
      Tenant
      Improvements       .

     

    (e)
      Total
      Due Upon Execution of this Lease:
      $  26,670.00   
      .

    


    1.8
      Agreed
      use:  
      General
      office, showroom and manufacturing of vinyl fences   .
      (See
      also Paragraph 6)

    


    1.9
      Insuring
      Party.
      Lessor
      is the “Insuring Party”. (See also Paragraph 8)

    


    1.10
      Real
      Estate Brokers:
      (See
      also Paragraph 15.)

    


    (a)
      Representation:
      The
      following real estate brokers (the “Brokers”) and brokerage
      relationships exist in this transaction (check applicable boxes):

    


     ̈                                       
                   
                         
      represents Lessor exclusively (“Lessor’s
      Broker”);

    


     ̈                                             
            
                           represents
      Lessee exclusively (“Lessee’s
      Broker”);
      or

    


    þ Southwest
      Commercial
      represents both Lessor and Lessee (“Dual
      Agency”).

    


    (b)
      Payment
      to Brokers:
      Upon
      execution and delivery of this Lease by both Parties, Lessor shall pay to the
      Brokers the brokerage fee agreed to in a separate written agreement (or if
      there
      is no such agreement, the sum of   per
      agreement       or  
—   % of the total Base Rent for the brokerage services rendered
      by the Brokers).

    


    1.11
      Guarantor.
      The
      obligations of the Lessee under this Lease are to be guaranteed
      by   Gordon
      M. Knott      (“Guarantor”).
      (See
      also Paragraph 37) 

    


    1.12
      Attachments.
      Attached
      hereto are the following, all of which constitute a part of this
      Lease:

    an
      Addendum consisting of Paragraphs   50  
 through   53   ;

    


     ̈
      a site plan depicting the
      Premises;

     

    þ
      a site
      plan depicting the Project;

     

    þ
      a
      current set of the Rules and Regulations for the Project;

     

     ̈
      a
      current set of the Rules and regulations adopted by the owners’
association;

     

     ̈
      a Work
      Letter;

     

    þ other
      (specify):  
Floor Plan (Exhibit
      A)       

     

      
        

      

      
        	*	
                plus
                  2nd floor addition of 500 sq ft = 10,000 sq
                  ft

              


      

    

     

    
      	 	 
	
              

            	
              

            
	
                 
                Initials

            	
              Initials    
                

            


    

     

    
      	©
              1998 - AIR Commercial Real Estate Association	
              REVISED

            	
              FORM
                MTG-3-12/03E

            


    

     

    
      
        
        

      

      
        Page
          1 of
          12

        
          

        

      

      
        
        

      

    

     

    2.
      Premises.

     

    2.1
      Letting.
      Lessor
      hereby leases to Lessee, and Lessee hereby leases from Lessor, the Premises,
      for
      the term, at the rental, and upon all of the terms, covenants and conditions
      set
      forth in this Lease. Unless otherwise provided herein, any statement of size
      set
      forth in this Lease, or that may have been used in calculating Rent, is an
      approximation which the Parties agree is reasonable and any payments based
      thereon are not subject to revision whether or not the actual size is more
      or
      less. NOTE:
      Lessee is advised to verify the actual size prior to executing this
      Lease.

     

    2.2
      Condition.
      Lessor
      shall deliver that portion of the Premises contained within the Building
("Unit")
      to
      Lessee
      broom clean and free of debris on the Commencement Date or the Early Possession
      Date, whichever first occurs ("Start
      Date"), and,
      so
      long as the required service contracts described in Paragraph 7.1(b) below
      are
      obtained by Lessee and in effect within thirty days following the Start Date,
      warrants that the existing electrical, plumbing, fire sprinkler, lighting,
      heating, ventilating and air conditioning systems ("HVAC"),
      loading
      doors, sump pumps, if any, and all other such elements in the Unit, other than
      those constructed by Lessee, shall be in good operating condition on said date,
      that the structural elements of the roof, bearing walls and foundation of the
      Unit shall be free of material defects, and that the Unit does not contain
      hazardous levels of any mold or fungi defined as toxic under applicable state
      or
      federal law. If a non-compliance with such warranty exists as of the Start
      Date,
      or if one of such systems or elements should malfunction or fail within the
      appropriate warranty period, Lessor shall, as Lessor's sole obligation with
      respect to such matter, except as otherwise provided in this Lease, promptly
      after receipt of written notice from Lessee setting forth with specificity
      the
      nature and extent of such non-compliance, malfunction or failure, rectify same
      at Lessor's expense. The warranty periods shall be as follows: (i) 6 months
      as
      to the
      HVAC
      systems, and (ii) 30 days as to the remaining systems and other elements of
      the
      Unit. If Lessee does not give Lessor the required notice within the appropriate
      warranty period, correction of any such non-compliance, malfunction or failure
      shall be the obligation of Lessee at Lessee's sole cost and expense (except
      for
      the repairs to the fire sprinkler systems, roof, foundations, and/or bearing
      walls - see Paragraph 7).

     

    2.3
      Compliance.
      Lessor
      warrants that to the best of its knowledge the improvements on the Premises
      and
      the Common Areas comply with the building codes that were in effect at the
      time
      that each such improvement, or portion thereof, was constructed, and also with
      all applicable laws, covenants or restrictions of record, regulations, and
      ordinances in effect on the Start Date ("Applicable
      Requirements"). Said
      warranty does not apply to the use to which Lessee will put the Premises,
      modifications which may be required by the Americans with Disabilities Act
      or
      any similar laws as a result of Lessee's use (see Paragraph 49), or to any
      Alterations or Utility Installations (as defined in Paragraph 7.3(a)) made
      or to
      be made by Lessee. NOTE:
      Lessee is responsible for determining whether or not the Applicable
      Requirements, and especially the zoning are
      appropriate
      for Lessee's intended use, and
      acknowledges
      that
      past
      uses
      of the Premises may no longer be allowed. If
      the
      Premises do not comply with said warranty, Lessor shall, except as otherwise
      provided, promptly after receipt of written notice from Lessee setting forth
      with specificity the nature and extent of such non-compliance, rectify the
      same
      at Lessor's expense. If Lessee does not give Lessor written notice of a
      non-compliance with this warranty within 6 months following the Start Date,
      correction of that non-compliance shall be the obligation of Lessee at Lessee's
      sole cost and expense. If the Applicable Requirements are hereafter changed
      so
      as to require during the term of this Lease the construction of an addition
      to
      or an alteration of the Unit, Premises and/or Building, the remediation of
      any
      Hazardous Substance, or the reinforcement or other physical modification of
      the
      Unit, Premises and/or Building ("Capital
      Expenditure"), Lessor
      and Lessee shall allocate the cost of such work as follows:

     

    (a) Subject
      to Paragraph 2.3(c) below, if such Capital Expenditures are required as a result
      of the specific and unique use of the Premises by Lessee as compared with uses
      by tenants in general, Lessee shall be fully responsible for the cost thereof,
      provided, however that if such Capital Expenditure is required during the last
      2
      years of this Lease and the cost thereof exceeds 6 months' Base Rent, Lessee
      may
      instead terminate this Lease unless Lessor notifies Lessee, in writing, within
      10 days after receipt of Lessee's termination notice that Lessor has elected
      to
      pay the difference between the actual cost thereof and the amount equal to
      6
      months' Base Rent. If Lessee elects termination, Lessee shall immediately cease
      the use of the Premises which requires such Capital Expenditure and deliver
      to
      Lessor written notice specifying a termination date at least 90 days thereafter.
      Such termination date shall, however, in no event be earlier than the last
      day
      that Lessee could legally utilize the Premises without commencing such Capital
      Expenditure.

     

    (b) If
      such
      Capital Expenditure is not the result of the specific and unique use of the
      Premises by Lessee (such as, governmentally mandated seismic modifications),
      then Lessor and Lessee shall allocate the obligation to pay for the portion
      of
      such costs reasonably attributable to the Premises pursuant to the formula
      set
      out in Paragraph 7.1(d); provided, however, that if such Capital Expenditure
      is
      required during the last 2 years of this Lease or if Lessor reasonably
      determines that it is not economically feasible to pay its share thereof, Lessor
      shall have the option to terminate this Lease upon 90 days prior written notice
      to Lessee unless Lessee notifies Lessor, in writing, within 10 days after
      receipt of Lessor's termination, notice that Lessee will pay for such Capital
      Expenditure. If Lessor does not elect to terminate, and fails to tender its
      share of any such Capital Expenditure, Lessee may advance such funds and deduct
      same, with Interest, from Rent until Lessor's share of such costs have been
      fully paid. If Lessee is unable to finance Lessor's share, or if the balance
      of
      the Rent due and payable for the remainder of this Lease is not sufficient
      to
      fully reimburse Lessee on an offset basis, Lessee shall have the right to
      terminate this Lease upon 30 days written notice to Lessor.

     

    (c) Notwithstanding
      the above, the provisions concerning Capital Expenditures are intended to apply
      only to non-voluntary, unexpected, and new Applicable Requirements. If the
      Capital Expenditures are instead triggered by Lessee as a result of an actual
      or
      proposed change in use, change in intensity of use, or modification to the
      Premises then, and in that event, Lessee shall either: (i) immediately cease
      such changed use or intensity of use and/or take such other steps as may be
      necessary to eliminate the requirement for such Capital Expenditure, or (ii)
      complete such Capital Expenditure at its own expense. Lessee shall not have
      any
      right, to terminate this Lease.

     

    2.4 Acknowledgements.
      Lessee
      acknowledges that: (a) it has been advised by Lessor and/or Brokers to satisfy
      itself with respect to the condition of the Premises (including but not limited
      to the electrical, HVAC and fire sprinkler systems, security, environmental
      aspects, and compliance with Applicable Requirements and the Americans with
      Disabilities Act), and their suitability for Lessee's intended use, (b) Lessee
      has made such investigation as it deems necessary with reference to such matters
      and assumes alt responsibility therefor as the same relate to its occupancy
      of
      the Premises, and (c) neither Lessor, Lessor's agents, nor Brokers have made
      any
      oral or written representations or warranties with respect to said matters
      other
      than as set forth in this Lease. In addition, Lessor acknowledges that: (i)
      Brokers have made no
      representations,
      promises or warranties concerning Lessee's
      ability
      to honor the Lease or suitability to occupy the Premises, and (ii) it is
      Lessor's sole responsibility to investigate the financial capability and/or
      suitability of all proposed tenants.

     

    2.5 Lessee
      as Prior Owner/Occupant. The
      warranties made by Lessor in Paragraph 2 shall be of no force or effect if
      immediately prior to the Start Dale Lessee was the owner or occupant of the
      Premises. In such event, Lessee shall be responsible for any necessary
      corrective work.

     

    2.6 Vehicle
      Parking. Lessee
      shall be entitled to use the number of parking spaces specified in Paragraph
      1.2(b) on those portions of the Common Areas designated from time to time by
      Lessor for parking. Lessee shall not use more parking spaces than said number.
      Said parking spaces shall be used for parking by vehicles no larger than
      full-size passenger automobiles or pick-up trucks, herein called "Permitted
      Size Vehicles." Lessor
      may regulate the loading and unloading of vehicles by adopting Rules and
      Regulations as provided in Paragraph 2.9. No
      vehicles
      other than Permitted Size Vehicles may be parked in the Common Area without
      the
      prior written permission of Lessor. In addition:

     

    (a) Lessee
      shall not permit or
      allow
      any
      vehicles that belong to or are controlled by Lessee or Lessee's employees,
      suppliers, shippers,
      customers, contractors or invitees to be loaded, unloaded, or parked in areas
      other than those designated by Lessor for such activities.

     

    (b) Lessee
      shall not service or store any vehicles in the Common Areas.

     

    (c) If
      Lessee
      permits or allows any of the prohibited activities described in this Paragraph
      2.6, then Lessor shall have the right, without
      notice, in addition to such other rights and remedies that it may have, to
      remove or tow away the vehicle involved and charge the cost to Lessee,
which
      cost shall be immediately payable upon demand by Lessor.

     

    2.7 Common
      Areas - Definition. The
      term
"Common
      Areas" is
      defined as all areas and facilities outside the Premises and within the exterior
      boundary line of the Project and interior utility raceways and installations
      within the Unit that are provided and designated by the Lessor from time to
      time
      for the general non-exclusive use of Lessor, Lessee and other tenants of the
      Project and their respective employees, suppliers, shippers, customers,
      contractors and invitees, including parking areas, loading and unloading areas,
      trash areas, roadways, walkways, driveways and landscaped areas.

     

    2.8 Common
      Areas - Lessee's Rights.
      Lessor
      grants to Lessee, for the benefit of Lessee and its employees, suppliers,
      shippers, contractors, customers and invitees, during the term of this Lease,
      the non-exclusive right to use, in common with others entitled to such use,
      the
      Common Areas as they exist from time to time, subject to any rights, powers,
      and
      privileges reserved by Lessor under the terms hereof or under the terms of
      any
      rules and regulations or restrictions governing the use of the Project. Under
      no
      circumstances shall the right herein granted to use the Common Areas be deemed
      to include the right to store any property, temporarily or permanently, in
      the
      Common Areas. Any such storage shall be permitted only by the prior written
      consent of Lessor or Lessor's designated agent, which consent may be revoked
      at
      any time. In the event that any unauthorized storage shall occur then Lessor
      shall have the right, without notice, in addition to such other rights and
      remedies that it may have, to remove the property and charge the cost to Lessee,
      which cost shall be immediately payable upon demand by Lessor.

     

    2.9 Common
      Areas - Rules and Regulations. Lessor
      or
      such other person(s) as Lessor may appoint shall have the exclusive control
      and
      management of the Common Areas and shall have the right, from time to time,
      to
      establish, modify, amend and enforce reasonable rules and regulations
("Rules
      and
      Regulations") for the management, safety, care, and cleanliness of the
      grounds, the parking and unloading of vehicles and the preservation of good
      order, as well as for the convenience of other occupants or tenants of the
      Building and the Project and their invitees. Lessee agrees to abide by and
      conform to all such Rules and Regulations, and shall use its best efforts to
      cause its employees, suppliers, shippers, customers, contractors and invitees
      to
      so abide and conform. Lessor shall not be responsible to Lessee for the
      non-compliance with said Rules and Regulations by other tenants of the
      Project.

     

    2.10
      Common
      Areas - Changes. Lessor
      shall have the right, in Lessor's sole discretion, from time to
      time: 

     

    (a)
      To
      make changes to the Common Areas, including, without limitation, changes in
      the
      location, size, shape and number of Initials driveways, entrances, parking
      spaces, parking areas, loading and unloading areas, ingress, egress, direction
      of traffic, landscaped areas, walkways and utility raceways;

     

    
      
        	
                

              	
                

              
	
                   
                  Initials

              	
                Initials    
                  

              


      

       

      
        
          	©
                  1998 - AIR Commercial Real Estate Association	
                  REVISED

                	
                  FORM
                    MTG-3-12/03E

                


        

         

      

    

    
      
        
        

      

      
        Page
          2 of
          12

        
          

        

      

      
        
        

      

    

     

    (b)
      To
      close
      temporarily any of the Common Areas for maintenance purposes so long as
      reasonable access to the Premises remains
      available;

     

    (c)
      To
      designate other land outside the boundaries of the Project to be a part of
      the
      Common Areas;

     

    (d)
      To
      add
      additional buildings and improvements to the Common Areas;

     

    (e)
      To
      use
      the Common Areas while engaged in making additional improvements, repairs or
      alterations to the Project, or any portion
      thereof; and

     

    (f)
      To
      do and
      perform such other acts and make such other changes in, to or with respect
      to
      the Common Areas and Project as Lessor
      may, in the exercise of sound business judgment, deem to be
      appropriate.

     

    3.
      Term.

     

    3.1
      Term.
      The Commencement Date, Expiration Date and Original Term of this Lease are
      as
      specified in Paragraph 1.3.

     

    3.2
      Early
      Possession. If Lessee totally or partially occupies the Premises prior
      to the Commencement Date, the obligation to pay Base Rent shall be abated for
      the period of such early possession. All other terms of this Lease (including
      but not limited to the obligations to pay Lessee's Share of Common Area
      Operating Expenses, Real Property Taxes and insurance premiums and to maintain
      the Premises) shall be in effect during such period. Any such early possession
      shall not affect the Expiration Date.

     

    3.3
      Delay
      In Possession. Lessor agrees to use its best commercially reasonable
      efforts to deliver possession of the Premises to Lessee by the Commencement
      Date. If, despite said efforts, Lessor is unable to deliver possession as
      agreed, Lessor shall not be subject to any liability therefor, nor shall such
      failure affect the validity of this Lease or change the Expiration Date. Lessee
      shall not, however, be obligated to pay Rent or perform its other obligations
      until Lessor delivers possession of the Premises and any period of rent
      abatement that Lessee would otherwise have enjoyed shall run from the date
      of
      the delivery of possession and continue for a period equal to what Lessee would
      otherwise have enjoyed, but minus any days of delay caused by the acts or
      omissions of Lessee. If possession is not delivered within 60 days after the
      Commencement Date, Lessee may, at its option, by notice in writing within 10
      days after the end of such 60 day period, cancel this Lease, in which event
      the
      Parties shall be discharged from all obligations hereunder. If such written
      notice is not received by Lessor within said 10 day period, Lessee's right
      to
      cancel shall terminate. Except as otherwise provided, if possession is not
      tendered to Lessee by the Start Date and Lessee does not terminate this Lease,
      as aforesaid, any period of rent abatement that Lessee would otherwise have
      enjoyed shall run from the date of delivery of possession and continue for
      a
      period equal to what Lessee would otherwise have enjoyed under the terms hereof,
      but minus any days of delay caused by the acts or omissions of Lessee. If
      possession of the Premises is not delivered within 4 months after the
      Commencement Date, this Lease shall terminate unless other agreements are
      reached between Lessor and Lessee, in writing.

     

    3.4
      Lessee
      Compliance. Lessor shall not be required to tender possession of the
      Premises to Lessee until Lessee complies with its obligation to provide evidence
      of insurance (Paragraph 8.5). Pending delivery of such evidence, Lessee shall
      be
      required to perform all of its obligations under this Lease from and after
      the
      Start Date, including the payment of Rent, notwithstanding Lessor's election
      to
      withhold possession pending receipt of such evidence of insurance. Further,
      if
      Lessee is required to perform any other conditions prior to or concurrent with
      the Start Date, the Start Date shall occur but Lessor may elect to withhold
      possession until such conditions are satisfied.

     

    4.
      Rent.

    4.1.
      Rent Defined. All monetary obligations of Lessee to Lessor
      under the terms of this Lease (except for the Security Deposit) are deemed
      to be
      rent ("Rent").

     

    4.2
      Common
      Area Operating Expenses. Lessee shall pay to Lessor during the term
      hereof, in addition to the Base Rent, Lessee's Share (as
      specified in Paragraph 1.6) of all Common Area Operating Expenses, as
      hereinafter defined, during each calendar year of the term of this Lease, in
      accordance
      with the following provisions:

     

    (a)
      "Common
      Area Operating Expenses" are defined, for purposes of this Lease, as
      all costs incurred by Lessor relating to the ownership
      and operation of the Project, including, but not limited to, the
      following:

     

    (i)
      The
      operation, repair and maintenance, in neat, clean, good order and condition,
      but
      not the replacement (see subparagraph
      (e)), of the following:

     

    (aa)
      The
      Common Areas and Common Area improvements, including parking areas, loading
      and
      unloading areas, trash areas, roadways, parkways, walkways, driveways,
      landscaped areas, bumpers, irrigation systems, Common Area lighting facilities,
      fences and gates, elevators, roofs, and roof drainage systems.

     

    (bb)
      Exterior signs and any tenant directories.

     

    (cc)
      Any
      fire sprinkler systems.

     

    (ii)
      The
      cost
      of water, gas, electricity and telephone to service the Common Areas and any
      utilities not separately metered.

     

    (iii)
      Trash
      disposal, pest control services, property management, security services, owner's
      association dues and fees, the
      cost
      to repaint the exterior of any structures and the cost of any environmental
      inspections.

     

    (iv)
      Reserves
      set aside for maintenance and repair of Common Areas and Common Area
      equipment.

     

    (v)Any
      increase above the Base Real Property Taxes (as defined in Paragraph
      10).

     

    (vi)
      Any
      "Insurance Cost Increase" (as defined in Paragraph 8).

     

    (vii) Any
      deductible portion of an insured loss concerning the Building or the Common
      Areas.

     

    (viii) Auditors',
      accountants' and attorneys' fees and costs related to the operation,
      maintenance, repair and replacement of
      the
      Project.

     

    (ix) The
      cost
      of any Capital Expenditure to the Building or the Project not covered under
      the
      provisions of Paragraph 2.3 provided;
      however, that Lessor shall allocate the cost of any such Capital Expenditure
      over a 12 year period and Lessee shall not be required to pay more than
      Lessee's Share of 1/144th of the cost of such Capital Expenditure in any given
      month.

     

    (x) Any
      other
      services to be provided by Lessor that are stated elsewhere in this Lease to
      be
      a Common Area Operating Expense.

     

    (b)
      Any
      Common Area Operating Expenses and Real Property Taxes that are specifically
      attributable to the Unit, the Building or to any other building in the Project
      or to the operation, repair and maintenance thereof, shall be allocated entirely
      to such Unit, Building, or other building. However, any Common Area Operating
      Expenses and Real Property Taxes that are not specifically attributable to
      the
      Building or to any other building or to the operation, repair and maintenance
      thereof, shall be equitably allocated by Lessor to all buildings in the
      Project.

     

    (c)
      The
      inclusion of the improvements, facilities and services set forth in Subparagraph
      4.2(a) shall not be deemed to impose an obligation upon Lessor to either have
      said improvements or facilities or to provide those services unless the Project
      already has the same, Lessor already provides the services, or Lessor has agreed
      elsewhere in this Lease to provide the same or some of them.

     

    (d)
      Lessee's
      Share of Common Area Operating Expenses is payable monthly on the same day
      as
      the Base Rent is due hereunder. The amount of such payments shall be based
      on
      Lessor's estimate of the annual Common Area Operating Expenses. Within 60 days
      after written request (but not more than once each year) Lessor shall deliver
      to
      Lessee a reasonably detailed statement showing Lessee's Share of the actual
      Common Area Operating Expenses incurred during the preceding year, If Lessee's
      payments during such year exceed Lessee's Share, Lessor shall credit the amount
      of such over-payment against Lessee's future payments. If Lessee's payments
      during such year were less than Lessee's Share, Lessee shall pay to Lessor
      the
      amount of the deficiency within 10 days after delivery by Lessor to Lessee
      of
      the statement.

     

    (e)
      Except
      as
      provided in paragraph 4.2(a)(viii), Common Area Operating Expenses shall not
      include the cost of replacing equipment or capital components such as the roof,
      foundations, exterior walls or Common Area capital improvements, such as the
      parking lot paving, elevators, fences that have a useful life for accounting
      purposes of 5 years or more.

     

    (f)
      Common
      Area Operating Expenses shall not include any expenses paid by any tenant
      directly to third parties, or as to which Lessor is otherwise reimbursed by
      any
      third party, other tenant, or insurance proceeds.

     

    4.3
      Payment.
      Lessee shall cause payment of Rent to be received by Lessor in lawful money
      of
      the United States, without offset or deduction (except
      as specifically permitted in this Lease), on or before the day on which it
      is
      due. All monetary amounts shall be rounded to the nearest whole dollar. In
      the
      event
      that any invoice prepared by Lessor is inaccurate such inaccuracy shall not
      constitute a waiver and Lessee shall be obligated to pay the amount set
forth
      in
      this Lease. Rent for any period during the term hereof which is for less than
      one full calendar month shall be prorated based upon the actual number
of
      days
      of said month. Payment of Rent shall be made to Lessor at its address stated
      herein or to such other persons or place as Lessor'may from time to time
      designate in writing. Acceptance of a payment which is less than the amount
      then
      due shall not be a waiver of Lessor's rights to the balance of such Rent,
      regardless of Lessor's endorsement of any check so stating. In the event that
      any check, draft, or other instrument of payment given by Lessee to Lessor
      is
      dishonored for any reason, Lessee agrees to pay to Lessor the sum of $25 in
      addition to any Late Charge and Lessor, at its option, may require all
future
      Rent be paid by cashier's check. Payments will be applied first to accrued
      late
      charges and attorney's fees, second to accrued interest, then to Base
Rent
      and
      Common Area Operating Expenses, and any remaining amount to any other
      outstanding charges or costs.

     

    5.
      Security
      Deposit. Lessee shall deposit with Lessor upon execution hereof the
      Security Deposit as security for Lessee's faithful performance of its
obligations
      under this Lease. If Lessee fails to pay Rent, or otherwise Defaults under
      this
      Lease, Lessor may use, apply or retain all or any portion of said Security
      Deposit for the payment of any amount due Lessor or to reimburse or compensate
      Lessor for any liability, expense, loss or damage which Lessor may
      suffer or incur by reason thereof. If Lessor uses or applies all or any portion
      of the Security Deposit, Lessee shall within 10 days after written request
      therefore
      deposit monies with Lessor sufficient to restore said Security Deposit to the
      full amount required by this Lease. If the Base Rent increases during the
term of
      this Lease, Lessee shall, upon written request from Lessor, deposit
      additional monies with Lessor so that the total amount of the Security Deposit
      shall
      at
      all times bear the same proportion to the increased Base Rent as the initial
      Security Deposit bore to the initial Base Rent. Should the Agreed Use be
amended
      to accommodate a material change in the business of Lessee or to accommodate
      a
      sublessee
      or assignee, Lessor shall have the right to increase the Security Deposit to
      the
      extent necessary, in Lessor's reasonable judgment, to account for any increased
      wear and tear that the Premises may suffer as a result thereof. If a change
      in
      control of Lessee occurs during this Lease and following such change the
      financial condition of Lessee is, in Lessor's reasonable judgment, significantly
      reduced, Lessee shall deposit such additional monies with Lessor as shall be
      sufficient to cause the Security Deposit to be at a
      commercially
      reasonable level based on such change in
      financial
      condition. Lessor shall not be
      required
      to keep the Security Deposit separate from its general accounts. Within 14
      days
      after the expiration or termination of this Lease, if Lessor elects to
      apply
      the
      Security Deposit only to unpaid Rent, and otherwise within 30 days after the
      Premises have been vacated pursuant to Paragraph 7.4(c)
      below,
      Lessor shall return that portion of the Security Deposit not used or applied
      by
      Lessor. No part of the Security Deposit shall be considered to be held
in
      trust,
      to
      bear interest or to be
      prepayment
      for any monies to be paid by Lessee under this Lease.

     

    
      	
              

            	
              

            
	
                 
                Initials

            	
              Initials    
                

            


    

     

    
      
        	©
                1998 - AIR Commercial Real Estate Association	
                REVISED

              	
                FORM
                  MTG-3-12/03E

              


      

       

    

    
      
        
        

      

      
        Page
          3 of
          12

        
          

        

      

      
        
        

      

    

     

    6.
      Use.

     

    6.1
      Use.
      Lessee shall use and occupy the Premises only for the Agreed Use, or any other
      legal use which is reasonably comparable thereto, and
      for
      no other purpose. Lessee shall not use or permit the use of the Premises in
      a
      manner
      that is unlawful, creates damage, waste or a nuisance, or that disturbs
      occupants of or causes damage to neighboring premises or properties. Other
      than
      guide, signal and seeing eye dogs, Lessee shall not keep or allow in
      the
      Premises any pets, animals, birds, fish, or reptiles. Lessor shall not
      unreasonably withhold or delay its consent to any written request for a
      modification of
      the
      Agreed Use, so long as the same will not impair the structural integrity of
      the
      Building or the mechanical or electrical systems therein, and/or is not
significantly
      more burdensome to the Project. If Lessor elects to withhold consent, Lessor
      shall within 7 days after such request give written notification of same,
      which notice shall include an explanation of Lessor's
      objections
      to the change in the Agreed Use.

     

    6.2
      Hazardous
      Substances.

     

    (a)
      Reportable
      Uses Require Consent. The
      term
"Hazardous
      Substance" as
      used
      in this Lease shall mean any product, substance, or waste whose presence, use,
      manufacture, disposal, transportation, or release, either by itself or in
      combination with other materials expected to be on the Premises, is either:
      (i)
      potentially injurious to the public health, safety or welfare, the environment
      or the Premises, (ii) regulated or monitored by any governmental authority,
      or
      (iii) a
      basis
      for potential liability of Lessor to any governmental agency or third party
      under any applicable statute or common law theory. Hazardous Substances shall
      include, but not be limited to, hydrocarbons, petroleum, gasoline, and/or crude
      oil or any products, by-products or fractions thereof. Lessee shall not engage
      in any activity in or on the Premises which constitutes a
      Reportable
      Use of Hazardous Substances without the express prior written consent of Lessor
      and timely compliance (at Lessee's expense) with all Applicable Requirements.
      "Reportable
      Use" shall
      mean (i) the installation or use of any above or below ground storage tank,
      (ii)
      the generation, possession, storage, use, transportation, or disposal of
a
      Hazardous
      Substance that requires a permit from, or with respect to which a report,
      notice, registration or business plan is required to be filed with, any
      governmental authority, and/or (iii) the presence at the Premises of a Hazardous
      Substance with respect to which any Applicable Requirements requires that
a
      notice
      be
      given to persons entering or occupying the Premises or neighboring properties.
      Notwithstanding the foregoing, Lessee may use any ordinary and customary
      materials reasonably required to be used in the normal course of the Agreed
      Use,
      ordinary office supplies (copier toner, liquid paper, glue, etc.) and common
      household cleaning materials, so long as such use is in compliance with all
      Applicable Requirements, is not a
      Reportable
      Use, and does not expose the Premises or neighboring property to any meaningful
      risk of contamination or damage or expose Lessor to any liability therefor.
      In
      addition, Lessor may condition its consent to any Reportable Use upon receiving
      such additional assurances as Lessor reasonably deems necessary to protect
      itself, the public, the Premises and/or the environment against damage,
      contamination, injury and/or liability, including, but not limited to, the
      installation (and removal on or before Lease expiration or termination) of
      protective modifications (such as concrete encasements) and/or increasing the
      Security Deposit.

     

    (b)
      Duty
      to Inform Lessor. If
      Lessee
      knows, or has reasonable cause to believe, that a Hazardous Substance has come
      to be located in, on, under or about the Premises, other than as previously
      consented to by Lessor, Lessee shall immediately give written notice of such
      fact to Lessor, and provide Lessor with a copy of any report, notice, claim
      or
      other documentation which it has concerning the presence of such Hazardous
      Substance.

     

    (c)
      Lessee
      Remediation. Lessee
      shall not cause or permit any Hazardous Substance to be spilled or released
      in,
      on, under, or about the Premises (including through the plumbing or sanitary
      sewer system) and shall promptly, at Lessee's expense, comply with all
      Applicable Requirements and take all investigatory and/or remedial action
      reasonably recommended, whether or not formally ordered or required, for the
      cleanup of any contamination of, and for the maintenance, security and/or
      monitoring of the Premises or neighboring properties, that was caused or
      materially contributed to by Lessee, or pertaining to or involving any Hazardous
      Substance brought onto the Premises during the term of this Lease, by or for
      Lessee, or any third party.

     

    (d)
      Lessee
      Indemnification. Lessee
      shall indemnify, defend and hold Lessor, its agents, employees, lenders
and
      ground
      lessor, if any, harmless from and against any and all loss of rents and/or
      damages, liabilities, judgments, claims, expenses, penalties, and attorneys'
      and
      consultants' fees arising out of or involving any Hazardous Substance brought
      onto the Premises by or for Lessee, or any third party (provided, however,
      that
      Lessee shall have no liability under this Lease with respect to underground
      migration of any Hazardous Substance under the Premises from areas outside
      of
      the Project not caused or contributed to by Lessee). Lessee's obligations shall
      include, but not be limited to, the effects of any contamination or injury
      to
      person, property or the environment created or suffered by Lessee, and the
      cost
      of investigation, removal, remediation, restoration and/or abatement, and shall
      survive the expiration or termination of this Lease. No termination,
      cancellation or release agreement entered into by Lessor and Lessee shall
      release Lessee from, its obligations under this Lease with respect to Hazardous
      Substances, unless specifically so agreed by Lessor in writing at the time
      of
      such agreement.

     

    (e)
      Lessor
      Indemnification. Lessor
      and its successors and assigns shall indemnify, defend, reimburse and hold
      Lessee, its employees and lenders, harmless from and against any and all
      environmental damages, including the cost of remediation, which are suffered
      as
a
      direct
      result of Hazardous Substances on the Premises prior to Lessee taking possession
      or which are caused by the gross negligence or willful misconduct of Lessor,
      its
      agents or employees. Lessor's obligations, as and when required by the
      Applicable Requirements, shall include, but not be
      limited
      to, the cost of investigation, removal, remediation, restoration and/or
      abatement, and shall survive the expiration or termination of this
      Lease.

     

    (f)
      Investigations
      and Remediations. Lessor
      shall retain the responsibility and pay for any investigations or remediation
      measures required by governmental entities having jurisdiction with respect
      to
      the existence of Hazardous Substances on the Premises prior to Lessee taking
      possession, unless such remediation measure is required as a result of
      Lessee's
      use
      (including "Alterations", as defined in paragraph 7.3(a)
      below)
      of
      the Premises, in which event Lessee shall be responsible for such payment.
      Lessee shall cooperate fully in any such activities at the request of Lessor,
      including allowing Lessor and Lessor's agents to have reasonable access to
      the
      Premises at reasonable times in order to carry out Lessor's investigative and
      remedial responsibilities.

     

    (g)
      Lessor
      Termination Option. If
      a
      Hazardous Substance Condition (see Paragraph 9.1(e))
      occurs
      during the term of this Lease, unless Lessee is legally responsible therefor
      (in
      which case Lessee shall make the investigation and remediation thereof required
      by the Applicable Requirements and this Lease shall continue in full force
      and
      effect, but subject to Lessor's rights under Paragraph 6.2(d) and Paragraph
      13),
      Lessor may, at Lessor's option, either (i) investigate and remediate such
      Hazardous Substance Condition, if required, as soon as reasonably possible
      at
      Lessor's
      expense,
      in which event this Lease shall continue in full force and effect, or (ii)
      if
      the estimated cost to remediate such condition exceeds 12 times the then monthly
      Base Rent or $100,000, whichever is greater, give written notice to Lessee,
      within 30 days after receipt by Lessor of knowledge of the occurrence of such
      Hazardous Substance Condition, of Lessor's desire to terminate this Lease as
      of
      the date 60 days following the date of such notice. In the event Lessor elects
      to give a termination notice, Lessee may, within 10 days thereafter, give
      written notice to Lessor of Lessee's commitment to pay the amount by which
      the
      cost of the remediation of such Hazardous Substance Condition exceeds an amount
      equal to 12 times the then monthly Base Rent or $100,000, whichever is greater.
      Lessee shall provide Lessor with said funds or satisfactory assurance thereof
      within 30 days following such commitment. In such event, this Lease shall
      continue in full force and effect, and Lessor shall proceed to make such
      remediation as
      soon
      as
      reasonably possible after the required funds are available. If Lessee does
      not
      give such notice and provide the required funds or assurance thereof within
      the
      time provided, this Lease shall terminate as of the date specified in Lessor's
      notice of termination.


    6.3 Lessee's
      Compliance with Applicable
Requirements.
      Except as otherwise provided in this
      Lease, Lessee shall, at Lessee's sole expense, fully, diligently and in a timely
      manner, materially comply with all Applicable Requirements, the requirements
      of
      any applicable fire insurance underwriter or rating bureau, and the
      recommendations of Lessor's engineers and/or consultants which relate in any
      manner to such Requirements, without regard to whether said Requirements are
      now
      in effect or become effective after the Start Date. Lessee shall, within 10
      days
      after receipt of Lessor's written request, provide Lessor with copies of all
      permits and other documents, and other information evidencing Lessee's
      compliance with any Applicable Requirements specified by Lessor, and shall
      immediately upon receipt, notify Lessor in writing (with copies of any documents
      involved) of any threatened or actual claim, notice, citation, warning,
      complaint or report pertaining to or involving the failure of Lessee or the
      Premises to comply with any Applicable Requirements. Likewise, Lessee shall
      immediately give written notice to Lessor of: (i) any water damage to the
      Premises and any suspected seepage, pooling, dampness or other condition
      conducive to the production of mold; or (ii) any mustiness or other odors that
      might indicate the presence of mold in the Premises.

     

    6.4 Inspection;
      Compliance. Lessor
      and Lessor's "Lender"
      (as
      defined in Paragraph 30) and consultants shall have the right to enter into
      Premises at any time, in the case of an emergency, and otherwise at reasonable
      times after reasonable notice, for the purpose of inspecting the condition
      of
      the Premises and for verifying compliance by Lessee with this Lease. The cost
      of
      any such inspections shall be paid by Lessor, unless a
      violation
      of Applicable Requirements, or a Hazardous Substance condition (see Paragraph
      9.1) is found to exist or be imminent, or the inspection is requested or ordered
      by a governmental authority. In such case, Lessee shall upon request reimburse
      Lessor for the cost of such inspection, so long as such inspection is reasonably
      related to the violation or contamination. In addition, Lessee shall provide
      copies of all relevant material safety data sheets (MSDS)
      to
      Lessor
      within 10 days of the receipt of written request therefor.

    
      
         

        
          
            	
                    

                  	
                    

                  
	
                       
                      Initials

                  	
                    Initials    
                      

                  


          

           

          
            
              	©
                      1998 - AIR Commercial Real Estate Association	
                      REVISED

                    	
                      FORM
                        MTG-3-12/03E

                    


            

          

        

         

        
          
            
            

          

          
            Page
              4 of
              12

            
              

            

          

          
            
            

          

        

         

        7.
          Maintenance;
          Repairs, Utility Installations; Trade Fixtures and
          Alterations.

         

        7.1
          Lessee's
          Obligations.

         

        (a)
          In
          General. Subject
          to the provisions of Paragraph 2.2 (Condition), 2.3 (Compliance), 6,3
          (Lessee's
          Compliance
          with Applicable Requirements), 7.2 (Lessor's Obligations), 9 (Damage
          or
          Destruction), and 14 (Condemnation), Lessee shall, at Lessee's sole
          expense, keep the Premises, Utility Installations (intended for Lessee's
          exclusive use, no matter where located), and Alterations in good order,
          condition and repair (whether or not the portion
          of the Premises requiring repairs, or the means of repairing the same,
          are
          reasonably or readily accessible to Lessee, and whether or not the need
          for such
          repairs occurs as a result of Lessee's use, any prior use, the elements
          or the
          age of such portion of the Premises), including, but not limited to, all
          equipment or facilities, such as plumbing, HVAC equipment, electrical,
          lighting
          facilities, boilers, pressure vessels, fixtures, interior walls, interior
          surfaces of exterior walls, ceilings, floors, windows, doors, plate glass,
          and
          skylights but excluding any items which are the responsibility of Lessor
          pursuant to Paragraph 7.2. Lessee, in
          keeping
          the Premises in good order, condition and repair, shall exercise and perform
          good maintenance practices, specifically including the procurement and
          maintenance of the service contracts required by Paragraph 7.1(b) below.
          Lessee's obligations shall include restorations, replacements or renewals
          when
          necessary to keep the Premises and all improvements thereon or a part thereof
          in
          good order, condition and state of repair.

      

    

     

    (b)
      Service
      Contracts. Lessee
      shall, at Lessee's sole expense, procure and maintain contracts, with copies
      to
      Lessor, in customary form and substance for, and with contractors specializing
      and experienced in the maintenance of the following equipment and improvements,
      if any, if and when installed on the Premises: (i) HVAC equipment, (ii) boiler
      and pressure vessels, (iii) clarifiers, and (iv) any other equipment, if
      reasonably required by Lessor. However, Lessor reserves the right, upon notice
      to Lessee, to procure and maintain any or all of such service contracts, and
      Lessee shall reimburse Lessor, upon demand, for the cost thereof.

     

    (c)
      Failure
      to Perform. If
      Lessee
      fails to perform Lessee's obligations under this Paragraph 7.1, Lessor may
      enter
      upon the Premises after 10 days' prior written notice to Lessee (except in
      the
      case of an emergency, in which case no notice shall be required), perform such
      obligations on Lessee's behalf, and put the Premises in good order, condition
      and repair, and Lessee shall promptly pay to Lessor a sum equal to 115% of
      the
      cost thereof.

     

    (d)
      Replacement.
      Subject
      to Lessee's indemnification of Lessor as set forth in Paragraph 8.7 below,
      and
      without relieving Lessee of liability resulting from Lessee's failure to
      exercise and perform good maintenance practices, if an item described in
      Paragraph 7.1(b) cannot be repaired other than at a cost which is in excess
      of
      50% of the cost of replacing such item, then such item shall be replaced by
      Lessor, and the cost thereof shall be prorated between the Parties and Lessee
      shall only be obiigated to pay, each month during the remainder of the term
      of
      this Lease, on the date on which Base Rent is due, an amount equal to the
      product of multiplying the cost of such replacement by a fraction, the numerator
      of which is one, and the denominator of which is 144 (ie. 1/144th of the cost
      per month). Lessee shall pay interest on the unamortized balance but may prepay
      its obligation at any time.

     

    7.2
      Lessor's
      Obligations.
      Subject to the provisions of Paragraphs 2.2 (Condition), 2.3 (Compliance),
      4.2
      (Common Area Operating Expenses),
      6 (Use), 7.1 (Lessee's Obligations), 9 (Damage or Destruction) and 14
      (Condemnation), Lessor, subject to
      reimbursement
      pursuant to Paragraph 4.2,
      shall keep in good order, condition and repair the foundations, exterior walls,
      structural condition of interior bearing walls, exterior roof, fire sprinkler
      system,
      Common Area fire alarm and/or smoke detection systems, fire hydrants, parking
      lots, walkways, parkways, driveways, landscaping, fences, signs and
      utility systems serving the Common Areas and all parts thereof, as well as
      providing the services for which there is
      a
      Common
      Area Operating Expense pursuant
      to Paragraph 4.2. Lessor shall not be obligated to paint the exterior or
      interior surfaces of exterior walls nor shall Lessor be obligated to maintain,
      repair
      or
      replace windows, doors or plate glass of the Premises. Lessee expressly waives
      the benefit of any statute now or hereafter in effect to the extent it
is
      inconsistent with the terms of this Lease.

     

    7.3
      Utility
      Installations; Trade Fixtures; Alterations.

     

    (a)
      Definitions.
      The
      term
"Utility
      Installations" refers
      to
      all floor and window coverings, air and/or vacuum lines, power panels,
      electrical distribution, security and fire protection systems, communication
      cabling, lighting fixtures, HVAC equipment, plumbing, and fencing in or on
      the
      Premises. The term "Trade
      Fixtures" shall
      mean Lessee's machinery and equipment that can be removed without doing material
      damage to the Premises. The term "Alterations"
      shall
      mean any modification of the improvements, other than Utility Installations
      or
      Trade Fixtures, whether by addition or deletion. "Lessee
      Owned Alterations and/or Utility Installations" are
      defined as Alterations and/or Utility Installations made by Lessee that are
      not
      yet owned by Lessor pursuant to Paragraph 7.4(a).

     

    (b)
      Consent.
      Lessee
      shall not make any Alterations or Utility installations to the Premises without
      Lessor's prior written consent. Lessee may, however, make non-structural Utility
      Installations to the interior of the Premises (excluding the roof) without
      such
      consent but upon notice to Lessor, as long as they are not visible from the
      outside, do not involve puncturing, relocating or removing the roof or any
      existing walls, will not affect the electrical, plumbing, HVAC, and/or life
      safety systems, and the cumulative cost thereof during this Lease as extended
      does not exceed a sum equal to 3 month's Base Rent in the aggregate or a sum
      equal to one month's Base Rent in any one year. Notwithstanding the foregoing,
      Lessee shall not make or permit any roof penetrations and/or install anything
      on
      the roof without the prior written approval of Lessor. Lessor may, as a
      precondition to granting such approval, require Lessee to utilize a contractor
      chosen and/or approved by Lessor. Any Alterations or Utility Installations
      that
      Lessee shall desire to make and which require the consent of the Lessor shall
      be
      presented to Lessor in written form with detailed plans. Consent shall be deemed
      conditioned upon Lessee's: (i) acquiring all applicable governmental permits,
      (ii) furnishing Lessor with copies of both the permits and the plans and
      specifications prior to commencement of the work, and (iii) compliance with
      all
      conditions of said permits and other Applicable Requirements in a prompt and
      expeditious manner. Any Alterations or Utility Installations shall be performed
      in a workmanlike manner with good and sufficient materials. Lessee shall
      promptly upon completion furnish Lessor with as-built plans and specifications.
      For work which costs an amount in excess of one month's Base Rent, Lessor may
      condition its consent upon Lessee providing a lien and completion bond in an
      amount equal to 150% of the estimated cost of such Alteration or Utility
      Installation and/or upon Lessee's posting an additional Security Deposit with
      Lessor.

     

    (c)
      Liens;
      Bonds.
      Lessee
      shall pay, when due, all claims for labor or materials furnished or alleged
      to
      have been furnished to or for Lessee at or for use on the Premises, which claims
      are or may be secured by any mechanic's or materialmen's lien against the
      Premises or any interest therein. Lessee shall give Lessor not less than 10
      days
      notice prior to the commencement of any work in, on or about the Premises,
      and
      Lessor shall have the right to post notices of non-responsibility. If Lessee
      shall contest the validity of any such lien, claim or demand, then Lessee shall,
      at its sole expense defend and protect itself, Lessor and the Premises against
      the same and shall pay and satisfy any such adverse judgment that may be
      rendered thereon before the enforcement thereof. If Lessor shall require, Lessee
      shall furnish a surety bond in
      an
      amount
      equal to 150% of the
      amount
      of
      such contested lien, claim or demand, indemnifying Lessor against liability
      for
      the same. If Lessor elects to participate in any such action, Lessee shall
      pay
      Lessor's attorneys' fees and costs.

     

    7.4
      Ownership;
      Removal; Surrender; and Restoration.

     

    (a)
      Ownership.
      Subject
      to Lessor's right to require removal or elect ownership as hereinafter provided,
      all Alterations and Utility Installations made by Lessee shall be the property
      of Lessee, but considered a part of the Premises. Lessor may, at any time,
      elect
      in writing to be the owner of all or any specified part of the Lessee Owned
      Alterations and Utility Installations. Unless otherwise instructed per paragraph
      7.4(b) hereof, all Lessee Owned Alterations and Utility Installations shall,
      at
      the expiration or termination of this Lease, become the property of Lessor
      and
      be surrendered by Lessee with the Premises.

     

    (b)
      Removal.
      By delivery to Lessee of written notice from Lessor not earlier than 90 and
      not
      later than 30 days prior to the end of the term of this Lease, Lessor may
      require that any or all Lessee Owned Alterations or Utility Installations be
      removed by the expiration or termination of this Lease. Lessor may require
      the
      removal at any time of all or any part of any Lessee Owned Alterations
or
      Utility
      Installations made without the required consent.

     

    (c)
      Surrender;
      Restoration. Lessee
      shall surrender the Premises by the Expiration Date or any earlier termination
      date, with all of the improvements, parts and surfaces thereof broom clean
      and
      free of debris, and in good operating order, condition and state of repair,
      ordinary wear and tear excepted. "Ordinary wear and tear" shall not include
      any
      damage or deterioration that would have been prevented by good maintenance
      practice. Notwithstanding the foregoing, if this Lease is for 12 months or
      less,
      then Lessee shall surrender the Premises in the same condition as delivered
      to
      Lessee on the Start Date with NO allowance for ordinary wear and tear. Lessee
      shall repair any damage occasioned by the installation, maintenance or removal
      of Trade Fixtures, Lessee owned Alterations and/or Utility Installations,
      furnishings, and equipment as well as the removal of any storage tank installed
      by or for Lessee. Lessee shall also completely remove from the Premises any
      and
      all Hazardous Substances brought onto the Premises by or for Lessee, or any
      third party (except Hazardous Substances which were deposited via underground
      migration from areas outside of the Premises) even if such removal would require
      Lessee to perform or pay for work that exceeds statutory requirements. Trade
      Fixtures shall remain the property of Lessee and shall be removed by Lessee.
      Any
      personal property of Lessee not removed on or before the Expiration Date or
      any
      earlier termination date shall be deemed to have been abandoned by Lessee and
      may be disposed of or retained by Lessor as Lessor may desire. The failure
      by
      Lessee to
      timely
      vacate the Premises pursuant to this Paragraph 7.4(c) without the express
      written consent of Lessor shall constitute a holdover under the provisions
      of
      Paragraph 26 below.

     

    8.
      Insurance;
      Indemnity.

     

    8.1
      Payment
      of Premium Increases.

     

    (a)
      As
      used
      herein, the term "Insurance
      Cost Increase" is
      defined as any increase in the actual cost of the insurance applicable to the
      Building and/or the Project and required to be carried by Lessor, pursuant
      to
      Paragraphs 8.2(b), 8.3(a) and 8.3(b), ("Required
      Insurance"), over
      and
      above the Base Premium, as hereinafter defined, calculated on an annual basis.
      Insurance Cost Increase shall include, but not be limited to, requirements
      of
      the holder of a mortgage or deed of trust covering the Premises, Building and/or
      Project, increased valuation of the Premises, Building and/or Project, and/or
      a
      general premium rate increase. The term Insurance Cost Increase shall not,
      however, include any premium increases resulting from the nature of the
      occupancy of any other tenant of the Building. If the parties insert a dollar
      amount in Paragraph 1.9, such amount shall be considered the "Base
Premium."
      The
      Base
      Premium shall be the annual premium applicable to the 12 month period
      immediately preceding the Start Date. If, however, the Project was not insured
      for the entirety of such 12 month period, then the Base Premium shall be the
      lowest annual premium reasonably obtainable for the Required Insurance as of
      the
      Start Date, assuming the most nominal use possible of the Building. In no event,
      however, shall Lessee be responsible for any portion of the premium cost
      attributable to liability insurance coverage in excess of $2,000,000 procured
      under Paragraph 8.2(b).

     

    (b)
      Lessee
      shall pay any Insurance Cost Increase to Lessor pursuant to Paragraph 4.2,
      Premiums for policy periods commencing prior to, or extending beyond, the term
      of this Lease shall be prorated to coincide with the corresponding Start Date
      or
      Expiration Date.

     

    
      
        	
                

              	
                

              
	
                   
                  Initials

              	
                Initials    
                  

              


      

       

      
        
          	©
                  1998 - AIR Commercial Real Estate Association	
                  REVISED

                	
                  FORM
                    MTG-3-12/03E

                


        

      

    

     

    
      
        
        

      

      
        Page
          5 of
          12

        
          

        

      

      
        
        

      

    

     

    8.2
      Liability
      Insurance.

     

    (a)
      Carried
      by Lessee. Lessee
      shall obtain and keep in force a Commercial General Liability policy of
      Insurance protecting Lessee and Lessor as an additional insured against claims
      for bodily injury, personal injury and property damage based upon or arising
      out
      of the ownership, use, occupancy
      or maintenance of the Premises and all areas appurtenant thereto. Such insurance
      shall be on an occurrence basis providing single limit coverage in an
      amount not less than $1,000,000 per occurrence with an annual aggregate of
      not
      less than $2,000,000, Lessee shall add Lessor as an 'additional insured by
      means
      of an endorsement at least as broad as the Insurance Service Organization's
      "Additional Insured-Managers or Lessors of Premises" Endorsement and coverage
      shall also be extended to include damage caused by heat, smoke or fumes from
      a
      hostile fire. The policy shall not contain any intra-insured exclusions as
      between insured persons or organizations, but shall include coverage for
      liability assumed under this Lease as an "insured
      contract" for
      the
      performance of Lessee's indemnity obligations under this Lease. The limits
      of
      said insurance shall not, however, limit the liability of Lessee nor relieve
      Lessee of any obligation hereunder. Lessee shall provide an endorsement on
      its
      liability policy(ies) which provides that its insurance shall be primary to
      and
      not contributory with any similar insurance carried by Lessor, whose insurance
      shall be considered excess insurance only.

     

    (b)
      Carried
      by Lessor. Lessor
      shall maintain liability insurance as described in Paragraph 8.2(a),
in
      addition
      to, and not in lieu of, the insurance required to be maintained by Lessee.
      Lessee shall not be named as an additional insured therein.

     

    8.3
      Property
      Insurance - Building, Improvements and Rental Value.

     

    (a)
      Building
      and Improvements. Lessor
      shall obtain and keep in force a policy or policies of insurance in
      the
      name
      of Lessor, with loss payable to Lessor, any ground-lessor, and to any Lender
      insuring loss or damage to the Premises. The amount of such insurance shall
      be
      equal to the full insurable replacement cost of the Premises, as the same shall
      exist from time to time, or the amount required by any Lender, but in no event
      more than the commercially reasonable and available insurable value thereof.
      Lessee Owned Alterations and Utility Installations, Trade Fixtures, and Lessee's
      personal property shall be insured by Lessee under Paragraph 8.4. If the
      coverage is available and commercially appropriate, such policy or policies
      shall insure against all risks of direct physical loss or damage (except the
      perils of flood and/or earthquake unless required by a Lender), including
      coverage for debris removal and the enforcement of any Applicable Requirements
      requiring the upgrading, demolition, reconstruction or replacement of any
      portion of the Premises as the result of a covered loss. Said policy or policies
      shall also contain an agreed valuation provision in lieu of any coinsurance
      clause, waiver of subrogation, and inflation guard protection causing an
      increase in the annual property insurance coverage amount by a
      factor
      of
      not less than the adjusted U.S. Department of Labor Consumer Price Index for
      All
      Urban Consumers for the city nearest to where the Premises are located. If
      such
      insurance coverage has a deductible clause, the deductible amount shall not
      exceed $1,000 per occurrence.

    (b)
      Rental
      Value. Lessor
      shall also obtain and keep in force a policy or policies in the name of Lessor
      with loss payable to Lessor and any Lender, insuring the loss of the full Rent
      for one year with an extended period of indemnity for an additional 180 days
      ("Rental
      Value insurance").
      Said
      insurance shall contain an agreed valuation provision in lieu of any coinsurance
      clause, and the amount of coverage shall be adjusted annually to reflect the
      projected Rent otherwise payable by Lessee, for the next 12 month
      period.

     

    (c)
      Adjacent
      Premises. Lessee
      shall pay for any increase in the premiums for the property insurance of the
      Building and for the Common Areas or other buildings in the Project if said
      increase is caused by Lessee's acts, omissions, use or occupancy of the
      Premises.

     

    (d)
      Lessee's
      Improvements. Since
      Lessor is the Insuring Party, Lessor shall not be required to insure Lessee
      Owned Alterations and Utility Installations unless the item in question has
      become the property of Lessor under the terms of this Lease.

     

    8.4
      Lessee's
      Property; Business Interruption Insurance.

     

    (a)
      Property
      Damage. Lessee
      shall obtain and maintain insurance coverage on all of Lessee's personal
      property, Trade Fixtures, and Lessee Owned Alterations and Utility
      Installations. Such insurance shall be full replacement cost coverage with
      a
      deductible of not to exceed $1,000 per occurrence. The proceeds from any such
      insurance shall be used by Lessee for the replacement of personal property,
      Trade Fixtures and Lessee Owned Alterations and Utility Installations. Lessee
      shall provide Lessor with written evidence that such insurance is in
      force.

     

    (b)
      Business
      Interruption. Lessee
      shall obtain and maintain loss of income and extra expense insurance in amounts
      as will reimburse Lessee for direct or indirect loss of earnings attributable
      to
      all perils commonly insured against by prudent lessees in the business of Lessee
      or attributable to prevention of access to the Premises as a
      result
      of
      such perils.

     

    (c)
      No
      Representation of Adequate Coverage. Lessor
      makes no representation that the limits or forms of coverage of insurance
      specified herein are adequate to cover Lessee's property, business operations
      or
      obligations under this Lease.

     

    8.5
      Insurance
      Policies. Insurance
      required herein shall be by companies duly licensed or admitted to transact
      business in the state where the Premises are located, and maintaining during
      the
      policy term a "General Policyholders Rating" of at least A-, VI, as set forth
      in
      the most current issue of "Best's Insurance Guide", or such other rating as
      may
      be required by a Lender. Lessee shall not do or permit to be done anything
      which
      invalidates the required insurance policies. Lessee shall, prior to the Start
      Date, deliver to Lessor certified copies of policies of such insurance or
      certificates evidencing the existence and amounts of the required insurance.
      No
      such policy shall be cancelable or subject to modification except after 30
      days
      prior written notice to Lessor. Lessee shall, at least 10 days prior to the
      expiration of such policies, furnish Lessor with evidence of renewals or
      "insurance binders" evidencing renewal thereof, or Lessor may order such
      insurance and charge the cost thereof to Lessee, which amount shall be payable
      by Lessee to Lessor upon demand. Such policies shall be for a term of at least
      one year, or the length of the remaining term of this Lease, whichever is less.
      If
      either
      Party shall fail to procure and maintain the insurance required to be carried
      by
      it, the other Party may, but shall not be required to, procure and maintain
      the
      same.

     

    8.6
      Waiver
      of
      Subrogation.
      Without affecting any other rights or remedies, Lessee and Lessor each hereby
      release and relieve the other, and waive their entire right to recover damages
      against the other, for loss of or damage to its property arising out of or
      incident to the perils required to be insured against herein. The effect of
      such
      releases and waivers is not limited by the amount of insurance carried or
      required, or by any deductibles applicable hereto. The Parties agree to have
      their respective property damage insurance carriers waive any right to
      subrogation that such companies may have against Lessor or Lessee, as the case
      may be, so long as the insurance is not invalidated thereby.

     

    8.7
      Indemnity.
      Except for Lessor's gross negligence or willful misconduct, Lessee shall
      indemnify, protect, defend and hold harmless the Premises, Lessor and its
      agents, Lessor's master or ground lessor, partners and Lenders, from and against
      any and all claims, loss of rents and/or damages, liens, judgments, penalties,
      attorneys' and consultants' fees, expenses and/or liabilities arising out of,
      involving, or in
      connection
      with, the use and/or occupancy of the Premises by Lessee. If any action or
      proceeding is brought against Lessor by reason of any of the foregoing matters,
      Lessee shall upon notice defend the same at Lessee's expense by counsel
      reasonably satisfactory to Lessor and Lessor shall cooperate with Lessee
in
      such
      defense. Lessor need not have first paid any such claim in order to be defended
      or indemnified.

     

    8.8
      Exemption
      of Lessor from Liability. Lessor
      shall not be liable for injury or damage to the person or goods, wares,
      merchandise or other property of Lessee, Lessee's employees, contractors,
      invitees, customers, or any other person in or about the Premises, whether
      such
      damage or injury is caused by or results from fire, steam, electricity, gas,
      water or rain, indoor air quality, the presence of mold or from the breakage,
      leakage, obstruction or other defects of pipes, fire sprinklers, wires,
      appliances, plumbing, HVAC or lighting fixtures, or from any other cause,
      whether the said injury or damage results from conditions arising upon the
      Premises or upon other portions of the Building, or from other sources or
      places. Lessor shall not be liable for any damages arising from any act or
      neglect of any other tenant of Lessor nor from the failure of Lessor to enforce
      the provisions of any other lease in the Project. Notwithstanding Lessor's
      negligence or breach of this Lease, Lessor shall under no circumstances be
      liable for injury to Lessee's business or for any loss of income or profit
      therefrom.

     

    8.9
      Failure
      to Provide Insurance. Lessee
      acknowledges that any failure on its part to obtain or maintain the insurance
      required herein will expose Lessor to risks and potentially cause Lessor to
      incur costs not contemplated by this Lease, the extent of which will be
      extremely difficult to ascertain. Accordingly, for any month or portion thereof
      that Lessee does not maintain the required insurance and/or does not provide
      Lessor with the required binders or certificates evidencing the existence of
      the
      required insurance, the Base Rent shall be automatically increased, without
      any
      requirement for notice to Lessee, by an amount equal to 10% of the then existing
      Base Rent or $100, whichever
      is
      greater. The parties agree that such increase in Base Rent represents fair
      and
      reasonable compensation for the additional risk/costs that Lessor will incur
      by
      reason of Lessee's failure to maintain the required insurance. Such increase
      in
      Base
      Rent
      shall in no event constitute a
      waiver
      of
      Lessee's Default or Breach with respect
      to
      the
      failure to maintain such insurance, prevent the exercise of any of the other
      rights and remedies granted hereunder, nor relieve Lessee of its obligation
      to
      maintain the insurance specified in this Lease.

     

    9.
      Damage
      or
Destruction.

     

    9.1
      Definitions.

     

    (a)
      "Premises
      Partial Damage" shall
      mean damage or destruction to the improvements on the Premises, other than
      Lessee Owned Alterations and Utility Installations, which can reasonably be
      repaired in 3 months or less from the date of the damage or destruction, and
      the
      cost thereof does not exceed a sum equal to 6 month's Base Rent. Lessor shall
      notify Lessee in writing within 30 days from the date of the damage or
      destruction as to whether or not the damage is Partial or Total. Notwithstanding
      the foregoing, Premises Partial Damage shall
      not
include
      damage to windows, doors, and/or other similar items which Lessee has the
      responsibility to repair or replace pursuant to the provisions of Paragraph
      7.1.

     

    (b)
      "Premises
      Total Destruction" shall mean damage or destruction to the improvements
      on the Premises, other than Lessee Owned Alterations and Utility Installations
      and Trade Fixtures, which cannot reasonably be repaired in 3 months or less
      from
      the date of the damage or destruction and/or the cost thereof exceeds a sum
      equal to 6 month's Base Rent. Lessor shall notify Lessee in writing within
      30
      days from the date of the damage or destruction as to whether or not the damage
      is Partial or Total.

     

    (c)
      "Insured
      Loss" shall
      mean damage or destruction to improvements on the Premises, other than Lessee
      Owned Alterations and Utility Installations and Trade Fixtures, which was caused
      by an event required to be covered by the insurance described in Paragraph
      8.3(a), irrespective of any deductible amounts or coverage limits
      involved.

     

    (d)
      "Replacement
      Cost" shall
      mean the cost to repair or rebuild the improvements owned by Lessor at the
      time
      of the occurrence to their condition existing immediately prior thereto,
      including demolition, debris removal and upgrading required by the operation
      of
      Applicable Requirements, and without deduction for depreciation.

     

    (e)
      "Hazardous
      Substance Condition" shall
      mean the occurrence or discovery of a condition involving the presence of,
      or
a
      contamination
      by, a Hazardous Substance as defined in Paragraph 6.2(a), in, on, or under
      the
      Premises which requires repair, remediation, or restoration.

     

    
      
        	
                

              	
                

              
	
                   
                  Initials

              	
                Initials    
                  

              


      

       

      
        
          	©
                  1998 - AIR Commercial Real Estate Association	
                  REVISED

                	
                  FORM
                    MTG-3-12/03E

                


        

      

    

     

    
      
        
        

      

      
        Page
          6 of
          12

        
          

        

      

      
        
        

      

    

     

    9.2 Partial
      Damage - Insured Loss. If
      a
      Premises Partial Damage that is an Insured Loss occurs, then Lessor shall,
      at
      Lessor's expense, repair
      such damage (but not Lessee's Trade Fixtures or Lessee Owned Alterations and
      Utility Installations) as soon as reasonably possible and this Lease shall
      continue in full force and effect; provided, however, that Lessee shall, at
      Lessor's election, make the repair of any damage or destruction the total cost
      to repair of which is $10,000 or less, and, in such event, Lessor shall make
      any
      applicable insurance proceeds available to Lessee on a reasonable basis for
      that
      purpose. Notwithstanding the foregoing, if the required insurance was not in
      force or the insurance proceeds are not sufficient to effect such repair, the
      Insuring Party shall promptly contribute the shortage in proceeds as and when
      required to complete said repairs. In the event, however, such shortage was
      due
      to the fact that, by reason of the unique nature of the improvements, full
      replacement cost insurance coverage was not commercially reasonable and
      available, Lessor shall have no obligation to pay for the shortage in insurance
      proceeds or to fully restore the unique aspects of the Premises unless Lessee
      provides Lessor with the funds to cover same, or adequate assurance thereof,
      within 10 days following receipt of written notice of such shortage and request
      therefor. If Lessor receives said funds or adequate assurance thereof within
      said 10 day period, the party responsible for making the repairs shall complete
      them as soon as reasonably possible and this Lease shall remain in full force
      and effect. If such funds or assurance are not received, Lessor may nevertheless
      elect by written notice to Lessee within 10 days thereafter to: (i) make such
      restoration and repair as is commercially reasonable with Lessor paying any
      shortage in proceeds, in which case this Lease shall remain in full force and
      effect, or (ii) have this Lease terminate 30 days thereafter. Lessee shall
      not
      be entitled to reimbursement of any funds contributed by Lessee to repair any
      such damage or destruction. Premises Partial Damage due to flood or earthquake
      shall be subject to Paragraph 9.3, notwithstanding that there may be some
      insurance coverage, but the net proceeds of any such insurance shall be made
      available for the repairs if made by either Party.

     

    9.3
      Partial
      Damage - Uninsured Loss. If a Premises Partial Damage that is not an
      Insured Loss occurs, unless caused by a negligent or willful act of Lessee
      (in
      which event Lessee shall make the repairs at Lessee's expense), Lessor may
      either: (i) repair such damage as soon as reasonably possible at Lessor's
      expense, in which event this Lease shall continue in full force and effect,
      or
      (ii) terminate this Lease by giving written notice to Lessee within 30 days
      after receipt by Lessor of knowledge of the occurrence of such damage, Such
      termination shall be effective 60 days following the date of such notice. In
      the
      event Lessor elects to terminate this Lease, Lessee shall have the right within
      10 days after receipt of the termination notice to give written notice to Lessor
      of Lessee's commitment to pay for the repair of such damage without
      reimbursement from Lessor. Lessee shall provide Lessor with said funds or
      satisfactory assurance thereof within 30 days after making such commitment.
      In
      such event this Lease shall continue in full force and effect, and Lessor shall
      proceed to make such repairs as soon as reasonably possible after the required
      funds are available. If Lessee does not make the required commitment, this
      Lease
      shall terminate as of the date specified in the termination notice.

     

    9.4
      Total
      Destruction. Notwithstanding any other provision hereof, if a Premises
      Total Destruction occurs, this Lease shall terminate 60 days following such
      Destruction. If the damage or destruction was caused by the gross negligence
      or
      willful misconduct of Lessee, Lessor shall have the right to recover Lessor's
      damages from Lessee, except as provided in Paragraph 8.6.

     

    9.5
      Damage
      Near End of
      Term.
      If at any time during the last 6 months of this Lease there is damage
      for which the cost to repair exceeds one month's Base Rent, whether or not
      an
      Insured Loss, Lessor may terminate this Lease effective 60 days following the
      date of occurrence of such damage by giving a written termination notice to
      Lessee within 30 days after the date of occurrence of such damage.
      Notwithstanding the foregoing, if Lessee at that time has an exercisable option
      to extend this Lease or to purchase the Premises, then Lessee may preserve
      this
      Lease by, (a) exercising such option and (b) providing Lessor with any shortage
      in Insurance proceeds (or adequate assurance thereof) needed to make the repairs
      on or before the earlier of (i) the date which is 10 days after Lessee's receipt
      of Lessor's written notice purporting to terminate this Lease, or (ii) the
      day
      prior to the date upon which such option expires. If Lessee duly exercises
      such
      option during such period and provides Lessor with funds (or adequate assurance
      thereof) to cover any shortage in insurance proceeds, Lessor shall, at Lessor's
      commercially reasonable expense, repair such damage as soon as reasonably
      possible and this Lease shall continue in full force and effect. If Lessee
      fails
      to exercise such option and provide such funds or assurance during such period,
      then this Lease shall terminate on the date specified in the termination notice
      and Lessee's option shall be extinguished.

     

    9.6
      Abatement
      of Rent; Lessee's Remedies.


    (a)
      Abatement.
      In the event of Premises Partial Damage or Premises Total Destruction or a
      Hazardous Substance Condition for which Lessee is not responsible under this
      Lease, the Rent payable by Lessee for the period required for the repair,
      remediation or restoration of such damage shall be abated in proportion to
      the
      degree to which Lessee's use of the Premises is impaired, but not to exceed
      the
      proceeds received from the Rental Value insurance. All other obligations of
      Lessee hereunder shall be performed by Lessee, and Lessor shall have no
      liability for any such damage, destruction, remediation, repair or restoration
      except as provided herein.

     

    (b)
      Remedies.
      If Lessor shall be obligated to repair or restore the Premises and
      does
      not commence, in a substantial and meaningful way, such repair or restoration
      within 90 days after such obligation shall accrue, Lessee may, at any time
      prior
      to the commencement of such repair or restoration, give written notice to Lessor
      and to any Lenders of which Lessee has actual notice, of Lessee's election
      to
      terminate this Lease on a date not less than 60 days following the giving of
      such notice. If Lessee gives such notice and such repair or restoration is
      not
      commenced within 30 days thereafter, this Lease shall terminate as of the date
      specified in said notice. If the repair or restoration is commenced within
      such
      30 days, this Lease shall continue in full force and effect. "Commence" shall
      mean either the unconditional authorization of the preparation of the required
      plans, or the beginning of the actual work on the Premises, whichever first
      occurs.

     

    9.7
      Termination;
      Advance Payments. Upon termination of this Lease pursuant to Paragraph
      6.2(g) or Paragraph 9, an equitable adjustment shall be made concerning advance
      Base Rent and any other advance payments made by Lessee to Lessor. Lessor shall,
      in addition, return to Lessee so much of Lessee's Security Deposit as has not
      been, or is not then required to be, used by Lessor.

     

    9.8
      Waive
      Statutes. Lessor and Lessee agree that the terms of this Lease shall
      govern the effect of any damage to or destruction of the Premises with respect
      to the termination of this Lease and hereby waive the provisions of any present
      or future statute to the extent inconsistent herewith.

     

    10.
      Real
      Property Taxes.

     

    10.1
      Definitions.

     

    (a)
      "Real
      Property Taxes." As used herein, the term "Real Property
      Taxes" shall include any form of assessment; real estate, general,
      special, ordinary or extraordinary, or rental levy or tax (other than
      inheritance, personal income or estate taxes); improvement bond; and/or license
      fee imposed upon or levied against any legal or equitable interest of Lessor
      in
      the Project, Lessor's right to other income therefrom, and/or Lessor's business
      of leasing, by any authority having the direct or indirect power to tax and
      where the funds are generated with reference to the Project address and where
      the proceeds so generated are to be applied by the city, county or other local
      taxing authority of a jurisdiction within which the Project is located. The
      term
      "Real Property Taxes" shall also include any tax, fee, levy, assessment or
      charge, or any increase therein: (i) imposed by reason of events occurring
      during the term of this Lease, including but not limited to, a change in the
      ownership of the Project, (ii) a change in the improvements thereon, and/or
      (iii) levied or assessed on machinery or equipment provided by Lessor to Lessee
      pursuant to this Lease.

     

    (b)
      "Base
      Real Property Taxes." As used herein, the term "Base Real
      Property Taxes" shall be the amount of Real Property Taxes, which are
      assessed against the Premises, Building, Project or Common Areas in the calendar
      year during which the Lease is executed. In calculating Real Property Taxes
      for
      any calendar year, the Real Property Taxes for any real estate tax year shall
      be
      included in the calculation of Real Property Taxes for such calendar year based
      upon the number of days which such calendar year and tax year have in
      common.


     

    10.2
      Payment
      of
      Taxes.
      Except as otherwise provided in Paragraph 10.3, Lessor shall pay the Real
      Property Taxes applicable to the Project, and said payments shall be included
      in
      the calculation of Common Area Operating Expenses in accordance with the
      provisions of Paragraph 4.2.

     

    10.3
      Additional
      Improvements. Common Area Operating Expenses shall not include Real
      Property Taxes specified in the tax assessor's records and work sheets as being
      caused by additional improvements placed upon the Project by other lessees
      or by
      Lessor for the exclusive enjoyment of such other lessees. Notwithstanding
      Paragraph 10.2 hereof, Lessee shall, however, pay to Lessor at the time Common
      Area Operating Expenses are payable under Paragraph 4.2, the entirety of any
      increase in Real Property Taxes if assessed solely by reason of Alterations,
      Trade Fixtures or Utility Installations placed upon the Premises by Lessee
      or at
      Lessee's request or by reason of any alterations or improvements to the Premises
      made by Lessor subsequent to the execution of this Lease by the
      Parties.

     

    10.4
      Joint
      Assessment. If the Building is not separately assessed, Real Property
      Taxes allocated to the Building shall be an equitable proportion of the Real
      Property Taxes for all of the land and improvements included within the tax
      parcel assessed, such proportion to be determined by Lessor from the respective
      valuations assigned in the assessor's work sheets or such other information
      as
      may be reasonably available. Lessor's reasonable determination thereof, in
      good
      faith, shall be conclusive.

     

    10.5
      Personal
      Property Taxes. Lessee shall pay prior to delinquency all taxes
      assessed against and levied upon Lessee Owned Alterations and Utility
      Installations, Trade Fixtures, furnishings, equipment and all personal property
      of Lessee contained in the Premises, When possible, Lessee shall cause its
      Lessee Owned Alterations and Utility Installations, Trade Fixtures, furnishings,
      equipment and all other personal property to be assessed and billed separately
      from the real property of Lessor. If any of Lessee's said property shall be
      assessed with Lessor's real property, Lessee shall pay Lessor the taxes
      attributable to Lessee's property within 10 days after receipt of a written
      statement setting forth the taxes applicable to Lessee's property.

     

    11.
      Utilities
      and Services. Lessee shall pay for all water, gas, heat, light, power,
      telephone, trash disposal and other utilities and services supplied to the
      Premises, together with any taxes thereon. Notwithstanding the provisions of
      Paragraph 4.2, if at any time in Lessor's sole judgment, Lessor determines
      that
      Lessee is using a disproportionate amount of water, electricity or other
      commonly metered utilities, or that Lessee is generating such a large volume
      of
      trash as to require an increase in the size of the trash receptacle and/or
      an
      increase in the number of times per month that it is emptied, then Lessor may
      increase Lessee's Base Rent by an amount equal to such increased costs. There
      shall be no abatement of Rent and Lessor shall not be liable in any respect
      whatsoever for the inadequacy, stoppage, interruption or discontinuance of
      any
      utility or service due to riot, strike, labor dispute, breakdown, accident,
      repair or other cause beyond Lessor's reasonable control or in cooperation
      with
      governmental request or directions.

     

    12.
      Assignment
      and Subletting.

     

    12.1
      Lessor's Consent Required.

     

    (a)
      Lessee shall not voluntarily or by operation of law assign, transfer, mortgage
      or encumber (collectively, "assign or
      assignment")
      or sublet all any
      part
      of Lessee's interest in this Lease or in the Premises without Lessor's prior
      written consent.

    
       

      
        
          	
                  

                	
                  

                
	
                     
                    Initials

                	
                  Initials    
                    

                


        

         

        
          
            	©
                    1998 - AIR Commercial Real Estate Association	
                    REVISED

                  	
                    FORM
                      MTG-3-12/03E

                  


          

        

      

    

     

    
      
        
        

      

      
        Page
          7 of
          12

        
          

        

      

      
        
        

      

    

     

    (b)
      Unless
      Lessee is a corporation and its stock is publicly traded on a national stock
      exchange, a change in the control of Lessee shall constitute an 'assignment
      requiring consent. The transfer, on a cumulative basis, of 25% or more of the
      voting control of Lessee shall constitute a change in control for this
      purpose.

     

    (c)
      The
      involvement of Lessee or its assets in any transaction, or series of
      transactions (by way of merger, sale, acquisition, financing, transfer,
      leveraged buy-out or otherwise), whether or not a formal assignment or
      hypothecation of this Lease or Lessee's assets occurs, which results or will
      result in a reduction of the Net Worth of Lessee by an amount greater than
      25%
      of such Net Worth as it was represented at the time of the execution of this
      Lease or at the time of the most recent assignment to which Lessor has
      consented, or as it exists immediately prior to said transaction or transactions
      constituting such reduction, whichever was or is greater, shall be considered
      an
      assignment of this Lease to which Lessor may withhold its consent. "Net
      Worth of Lessee" shall mean the net worth of Lessee (excluding any
      guarantors) established under generally accepted accounting
      principles.

     

    (d)
      An
      assignment or subletting without consent shall, at Lessor's option, be a Default
      curable after notice per Paragraph 13.1(c), or a noncurable Breach without
      the
      necessity of any notice and grace period. If Lessor elects to treat such
      unapproved assignment or subletting as a noncurable Breach, Lessor may either:
      (i) terminate this Lease, or (ii) upon 30 days written notice, increase the
      monthly Base Rent to 110% of the Base Rent then in effect. Further, in the
      event
      of such Breach and rental adjustment, (i) the purchase price of any option
      to
      purchase the Premises held by Lessee shall be subject to similar adjustment
      to
      110% of the price previously in effect, and (ii) all fixed and non-fixed rental
      adjustments scheduled during the remainder of the Lease term shall be increased
      to 110% of the scheduled adjusted rent.

     

    (e)
      Lessee's
      remedy for any breach of Paragraph 12.1 by Lessor shall be limited to
      compensatory damages and/or injunctive relief.

     

    (f)
      Lessor
      may reasonably withhold consent to a proposed assignment or subletting if Lessee
      is in Default at the time consent is requested.

     

    (g)
      Notwithstanding
      the foregoing, allowing a diminimus portion of the Premises, ie. 20 square
      feet
      or less, to be used by a third party vendor
      in
      connection with the installation of a vending machine or payphone shall not
      constitute a subletting.

     

    12.2
      Terms
      and
      Conditions Applicable to Assignment and
      Subletting.

     

    (a)
      Regardless
      of Lessor's consent, no assignment or subletting shall: (i) be effective without
      the express written assumption by such assignee or sublessee of the obligations
      of Lessee under this Lease, (ii) release Lessee of any obligations hereunder,
      or
      (iii) alter the primary liability of Lessee for the payment of Rent or for
      the
      performance of any other obligations to be performed by Lessee.

     

    (b)
      Lessor
      may accept Rent or performance of Lessee's obligations from any person other
      than Lessee pending approval or disapproval of an assignment. Neither a delay
      in
      the approval or disapproval of such assignment nor the acceptance of Rent or
      performance shall constitute a waiver or estoppel of Lessor's right to exercise
      its remedies for Lessee's Default or Breach.

     

    (c)
      Lessor's
      consent to any assignment or subletting shall not constitute consent to any
      subsequent assignment or subletting.

     

    (d)
      In
      the
      event of any Default or Breach by Lessee, Lessor may proceed directly against
      Lessee, any Guarantors or anyone else responsible for the performance of
      Lessee's obligations under this Lease, including any assignee or sublessee,
      without first exhausting Lessor's remedies against any other person or entity
      responsible therefore to Lessor, or any security held by Lessor.

     

    (e)
      Each
      request for consent to an assignment or subletting shall be in writing,
      accompanied by information relevant to Lessor's determination as to the
      financial and operational responsibility and appropriateness of the proposed
      assignee or sublessee, including but not limited to the intended use and/or
      required modification of the Premises, if any, together with a fee of $500
      as
      consideration for Lessor's considering and processing said request. Lessee
      agrees to provide Lessor with such other or additional information and/or
      documentation as may be reasonably requested. (See also Paragraph
      36)

     

    (f)
      Any
      assignee of, or sublessee under, this Lease shall, by reason of accepting such
      assignment, entering into such sublease, or entering into possession of the
      Premises or any portion thereof, be deemed to have assumed and agreed to conform
      and comply with each and every term, covenant, condition and obligation herein
      to be observed or performed by Lessee during the term of said assignment or
      sublease, other than such obligations as are contrary to or inconsistent with
      provisions of an assignment or sublease to which Lessor has specifically
      consented to in writing.

     

    (g)
      Lessor's
      consent to any assignment or subletting shall not transfer to the assignee
      or
      sublessee any Option granted to the original Lessee by this Lease unless such
      transfer is specifically consented to by Lessor in writing. (See Paragraph
      39.2)

     

    12.3
      Additional
      Terms and
      Conditions
      Applicable to Subletting. The following terms and conditions shall
      apply to any subletting by Lessee
      of
      all or any part of the Premises and shall be deemed included in all subleases
      under this Lease whether or not expressly incorporated therein:

     

    (a)
      Lessee
      hereby assigns and transfers to Lessor all of Lessee's interest in all Rent
      payable on any sublease, and Lessor may collect such Rent and apply same toward
      Lessee's obligations under this Lease; provided, however, that until a Breach
      shall occur in the performance of Lessee's obligations, Lessee may collect
      said
      Rent. In the event that the amount collected by Lessor exceeds Lessee's then
      outstanding obligations any such excess shall be refunded to Lessee. Lessor
      shall not, by reason of the foregoing or any assignment of such sublease, nor
      by
      reason of the collection of Rent, be deemed liable to the sublessee for any
      failure of Lessee to perform and comply with any of Lessee's obligations to
      such
      sublessee. Lessee hereby irrevocably authorizes and directs any such sublessee,
      upon receipt of a written notice from Lessor stating that a Breach exists in
      the
      performance of Lessee's obligations under this Lease, to pay to Lessor all
      Rent
      due and to become due under the sublease. Sublessee shall rely upon any such
      notice from Lessor and shall pay all Rents to Lessor without any obligation
      or
      right to inquire as to whether such Breach exists, notwithstanding any claim
      from Lessee to the contrary.

     

    (b)
      In
      the
      event of a Breach by Lessee, Lessor may, at its option, require sublessee to
      attorn to Lessor, in which event Lessor shall undertake the obligations of
      the
      sublessor under such sublease from the time of the exercise of said option
      to
      the expiration of such sublease; provided, however, Lessor shall not be liable
      for any prepaid rents or security deposit paid by such sublessee to such
      sublessor or for any prior Defaults or Breaches of such sublessor.

     

    (c)
      Any
      matter requiring the consent of the sublessor under a sublease shall also
      require the consent of Lessor.

     

    (d) No
      sublessee shall further assign or sublet all or any part of the Premises without
      Lessor's prior written consent.

     

    (e) Lessor
      shall deliver a copy of any notice of Default or Breach by Lessee to the
      sublessee, who shall have the right to cure the Default of
      Lessee
      within the grace period, if any, specified in such notice. The sublessee shall
      have a right of reimbursement and offset from and against Lessee for
any
      such
      Defaults cured by the sublessee.

     

    13.
      Default; Breach; Remedies.

     

    13.1
      Default; Breach. A "Default" is defined as a
      failure by the Lessee to comply with or perform any of the terms, covenants,
      conditions or Rules and Regulations under this Lease. A
"Breach" is defined as the occurrence of one or more of the
      following Defaults, and the failure of Lessee to cure such Default within any
      applicable grace period:

     

    (a) The
      abandonment of the Premises; or the vacating of the Premises without providing
      a
      commercially reasonable level of security, or where the coverage of the property
      insurance described in Paragraph 8.3 is jeopardized as a result thereof, or
      without providing reasonable assurances to minimize potential
      vandalism.

     

    (b) The
      failure of Lessee to make any payment of Rent or any Security Deposit required
      to be made by Lessee hereunder, whether to Lessor or to a third party, when
      due,
      to provide reasonable evidence of insurance or surety bond, or to fulfill any
      obligation under this Lease which endangers or threatens life or property,
      where
      such failure continues for a period of 3 business days following written notice
      to Lessee.

     

    (c) The
      commission of waste, act or acts constituting public or private nuisance, and/or
      an illegal activity on the Premises by Lessee, where such actions continue
      for a
      period of 3 business days following written notice to Lessee.

     

    (d) The
      failure by Lessee to provide (i) reasonable written evidence of compliance
      with
      Applicable Requirements, (ii) the service contracts, (iii) the rescission of
      an
      unauthorized assignment or subletting, (iv) an Estoppel Certificate, (v) a
      requested subordination, (vi) evidence concerning any guaranty and/or Guarantor,
      (vii) any document requested under Paragraph 41, (viii) material data safety
      sheets (MSDS), or (ix) any other documentation or information which Lessor
      may
      reasonably require of Lessee under the terms of this Lease, where any such
      failure continues for a period of 10 days following written notice to
      Lessee.

     

    (e) A
      Default
      by Lessee as to the terms, covenants, conditions or provisions of this Lease,
      or
      of the rules adopted under Paragraph 2.9 hereof, other than those described
      in
      subparagraphs 13.1(a), (b), (c) or (d), above, where such Default continues
      for
      a period of 30 days after written notice; provided, however, that if the nature
      of Lessee's Default is such that more than 30 days are reasonably required
      for
      its cure, then it shall not be deemed to be a Breach if Lessee commences such
      cure within said 30 day period and thereafter diligently prosecutes such cure
      to
      completion.

     

    (f) The
      occurrence of any of the following events: (i) the making of any general
      arrangement or assignment for the benefit of creditors; (ii) becoming a
"debtor" as defined in 11 U.S.C. § 101 or any successor statute
      thereto (unless, in the case of a petition filed against Lessee, the same is
      dismissed within 60 days); (iii) the appointment of a trustee or receiver to
      take possession of substantially all of Lessee's assets located at the Premises
      or of Lessee's interest in this Lease, where possession is not restored to
      Lessee within 30 days; or (iv) 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
      30
      days; provided, however, in the event that any provision of this subparagraph
      is
      contrary to any applicable law, such provision shall be of no force or effect,
      and not affect the validity of the remaining provisions.

     

    (g) The
      discovery that any financial statement of Lessee or of any Guarantor given
      to
      Lessor was materially false.

     

    (h) If
      the
      performance of Lessee's obligations under this Lease is guaranteed: (i) the
      death of a Guarantor, (ii) the termination of a Guarantor's
      liability with respect to this Lease other than in accordance with the terms
      of
      such guaranty, (iii) a Guarantor's becoming insolvent or the subject
of
      a
      bankruptcy filing, (iv) a Guarantor's refusal to honor the guaranty, or (v)
      a
      Guarantor's breach of its guaranty obligation on an anticipatory basis, and
      Lessee's
      failure, within 60 days following written notice of any such event, to provide
      written alternative assurance or security, which, when coupled with the
then
      existing resources of Lessee, equals or exceeds the combined financial resources
      of Lessee and the Guarantors that existed at the time of execution of
this Lease.

     

    
      
        
          	
                  

                	
                  

                
	
                     
                    Initials

                	
                  Initials    
                    

                


        

         

        
          
            	©
                    1998 - AIR Commercial Real Estate Association	
                    REVISED

                  	
                    FORM
                      MTG-3-12/03E

                  


          

        

      

    

     

    
      
        
        

      

      
        Page
          8 of
          12

        
          

        

      

      
        
        

      

    

    
       

      
        13.2
          Remedies. If Lessee fails to perform any of its affirmative
          duties or obligations, within 10 days after written notice (or in case
          of an
emergency, without notice), Lessor may, at its option, perform such
          duty
          or obligation on Lessee's behalf, including but not limited to the obtaining
          of
          reasonably required bonds, insurance policies, or governmental licenses,
          permits
          or approvals. Lessee shall pay to Lessor an amount equal to 115% of the
          costs
          and expenses incurred by Lessor in such performance upon receipt of an
          invoice
          therefor. In the event of a Breach, Lessor may, with or without further
          notice
          or demand, and without limiting Lessor in the exercise of any right or
          remedy
          which Lessor may have by reason of such Breach:

         

      

    

    (a) Terminate
      Lessee's right to possession of the Premises by any lawful means, in which
      case
      this Lease shall terminate and Lessee shall immediately surrender possession
      to
      Lessor. In such event Lessor shall be entitled to recover from Lessee: (i)
      the
      unpaid Rent which had been earned at the time of termination; (ii) the worth
      at
      the time of award of the amount by which the unpaid rent which would have been
      earned after termination until the time of award exceeds the amount of such
      rental loss that the Lessee proves could have been reasonably avoided; (iii)
      the
      worth at the time of award of the amount by which the unpaid rent for the
      balance of the term after the time of award exceeds the amount of such rental
      loss that the Lessee proves could be reasonably avoided; and (iv) any other
      amount necessary to compensate Lessor for all the detriment proximately caused
      by the Lessee's failure to perform its obligations under this Lease or which
      in
      the ordinary course of things would be likely to result therefrom, including
      but
      not limited to the cost of recovering possession of the Premises, expenses
      of
      reletting, including necessary renovation and alteration of the Premises,
      reasonable attorneys' fees, and that portion of any leasing commission paid
      by
      Lessor in connection with this Lease applicable to the unexpired term of this
      Lease. The worth at the time of award of the amount referred to in provision
      (iii) of the immediately preceding sentence shall be computed by discounting
      such amount at the discount rate of the Federal Reserve Bank of the District
      within which the Premises are located at the time of award plus one percent.
      Efforts by Lessor to mitigate damages caused by Lessee's Breach of this Lease
      shall not waive Lessor's right to recover damages under Paragraph 12. If
      termination of this Lease is obtained through the provisional remedy of unlawful
      detainer, Lessor shall have the right to recover in such proceeding any unpaid
      Rent and damages as are recoverable therein, or Lessor may reserve the right
      to
      recover all or any part thereof in a separate suit. If a notice and grace period
      required under Paragraph 13.1 was not previously given, a notice to pay rent
      or
      quit, or to perform or quit given to Lessee under the unlawful detainer statute
      shall also constitute the notice required by Paragraph 13.1. In such case,
      the
      applicable grace period required by Paragraph 13.1 and the unlawful detainer
      statute shall run concurrently, and the failure of Lessee to cure the Default
      within the greater of the two such grace periods shall constitute both an
      unlawful detainer and a Breach of this Lease entitling Lessor to the remedies
      provided for in this Lease and/or by said statute.

     

    (b) Continue
      the Lease and Lessee's right to possession and recover the Rent as it becomes
      due, in which event Lessee may sublet or assign, subject only to reasonable
      limitations. Acts of maintenance, efforts to relet, and/or the appointment
      of a
      receiver to protect the Lessor's interests, shall not constitute a termination
      of the Lessee's right to possession.

     

    (c) Pursue
      any other remedy now or hereafter available under the laws or judicial decisions
      of the state wherein the Premises are located. The expiration or termination
      of
      this Lease and/or the termination of Lessee's right to possession shall not
      relieve Lessee from liability under any indemnity provisions of this Lease
      as to
      matters occurring or accruing during the term hereof or by reason of Lessee's
      occupancy of the Premises.

     

    13.3 Inducement
      Recapture. Any agreement for free or abated rent or other charges, or
      for the giving or paying by Lessor to or for Lessee of any cash or other bonus,
      inducement or consideration for Lessee's entering into this Lease, all of which
      concessions are hereinafter referred to as "Inducement
      Provisions", shall be deemed conditioned upon Lessee's full and
      faithful performance of all of the terms, covenants and conditions of this
      Lease. Upon Breach of this Lease by Lessee, any such Inducement Provision shall
      automatically be deemed deleted from this Lease and of no further force or
      effect, and any rent, other charge, bonus, inducement or consideration
      theretofore abated, given or paid by Lessor under such an Inducement Provision
      shall be immediately due and payable by Lessee to Lessor, notwithstanding any
      subsequent cure of said Breach by Lessee. The acceptance by Lessor of rent
      or
      the cure of the Breach which initiated the operation of this paragraph shall
      not
      be deemed a waiver by Lessor of the provisions of this paragraph unless
      specifically so stated in writing by Lessor at the time of such
      acceptance.

     

    13.4 Late
      Charges. Lessee hereby acknowledges that late payment by Lessee of Rent
      will cause Lessor to incur costs not contemplated by this Lease, the exact
      amount of which will be extremely difficult to ascertain. Such costs include,
      but are not limited to, processing and accounting charges, and late charges
      which may be imposed upon Lessor by any Lender. Accordingly, if any Rent shall
      not be received by Lessor within 5 days after such amount shall be due, then,
      without any requirement for notice to Lessee, Lessee shall immediately pay
      to
      Lessor a one-time late charge equal to 10% of each such overdue amount or $100,
      whichever is greater. The parties hereby agree that such late charge represents
      a fair and reasonable estimate of the costs Lessor will incur by reason of
      such
      late payment. Acceptance of such late charge by Lessor shall in no event
      constitute a waiver of Lessee's Default or Breach with respect to such overdue
      amount, nor prevent the exercise of any of the other rights and remedies granted
      hereunder. In the event that a late charge is payable hereunder, whether or
      not
      collected, for 3 consecutive installments of Base Rent, then notwithstanding
      any
      provision of this Lease to the contrary, Base Rent shall, at Lessor's option,
      become due and payable quarterly in advance.

     

    13.5 Interest.
      Any monetary payment due Lessor hereunder, other than late charges, not received
      by Lessor, when due as to scheduled payments (such as Base Rent) or within
      30
      days following the date on which it was due for non-scheduled payment, shall
      bear interest from the date when due, as to scheduled payments, or the 31st
      day
      after it was due as to non-scheduled payments. The interest
      ("Interest") charged shall be computed at the rate of 10% per
      annum but shall not exceed the maximum rate allowed by law. Interest is payable
      in addition to the potential late charge provided for in Paragraph
      13.4.

     

    13.6 Breach
      by Lessor.

     

    (a) Notice
      of Breach. Lessor shall not be deemed in breach of this Lease unless
      Lessor fails within a reasonable time to perform an obligation required to
      be
      performed by Lessor. For purposes of this Paragraph, a reasonable time shall
      in
      no event be less than 30 days after receipt by Lessor, and any Lender whose
      name
      and address shall have been furnished Lessee in writing for such purpose, of
      written notice specifying wherein such obligation of Lessor has not been
      performed; provided, however, that if the nature of Lessor's obligation is
      such
      that more than 30 days are reasonably required for its performance, then Lessor
      shall not be in breach if performance is commenced within such 30 day period
      and
      thereafter diligently pursued to completion.

     

    (b) Performance
      by Lessee on Behalf of Lessor. In the event that neither Lessor nor
      Lender cures said breach within 30 days after receipt of said notice, or if
      having commenced said cure they do not diligently pursue it to completion,
      then
      Lessee may elect to cure said breach at Lessee's expense and offset from Rent
      the actual and reasonable cost to perform such cure, provided however, that
      such
      offset shall not exceed an amount equal to the greater of one month's Base
      Rent
      or the Security Deposit, reserving Lessee's right to reimbursement from Lessor
      for any such expense in excess of such offset. Lessee shall document the cost
      of
      said cure and supply said documentation to Lessor.

     

    14. Condemnation.
      If the Premises or any portion thereof are taken under the power of
      eminent domain or sold under the threat of the exercise of said power
      (collectively "Condemnation"), this Lease shall terminate as to
      the part taken as of the date the condemning authority takes title or
      possession, whichever first occurs. If more than 10% of the floor area of the
      Unit, or more than 25% of Lessee's Reserved Parking Spaces, is taken by
      Condemnation, Lessee may, at Lessee's option, to be exercised in writing within
      10 days after Lessor shall have given Lessee written notice of such taking
      (or
      in the absence of such notice, within 10 days after the condemning authority
      shall have taken possession) terminate this Lease as of the date the condemning
      authority takes such possession. If Lessee does not terminate this Lease in
      accordance with the foregoing, this Lease shall remain in full force and effect
      as to the portion of the Premises remaining, except that the Base Rent shall
      be
      reduced in proportion to the reduction in utility of the Premises caused by
      such
      Condemnation. Condemnation awards and/or payments shall be the property of
      Lessor, whether such award shall be made as compensation for diminution in
      value
      of the leasehold, the value of the part taken, or for severance damages;
      provided, however, that Lessee shall be entitled to any compensation for
      Lessee's relocation expenses, loss of business goodwill and/or Trade Fixtures,
      without regard to whether or not this Lease is terminated pursuant to the
      provisions of this Paragraph. All Alterations and Utility Installations made
      to
      the Premises by Lessee, for purposes of Condemnation only, shall be considered
      the property of the Lessee and Lessee shall be entitled to any and all
      compensation which is payable therefor. In the event that this Lease is not
      terminated by reason of the Condemnation, Lessor shall repair any damage to
      the
      Premises caused by such Condemnation.

     

    15. Brokerage
      Fees.

     

    15.1 Additional
      Commission. In addition to the payments owed pursuant to Paragraph 1.10
      above, and unless Lessor and the Brokers otherwise agree in writing, Lessor
      agrees that: (a) if Lessee exercises any Option, (b) if Lessee acquires from
      Lessor any rights to the Premises or other premises owned by Lessor and located
      within the Project, (c) if Lessee remains in possession of the Premises, with
      the consent of Lessor, after the expiration of this Lease, or (d) if Base Rent
      is increased, whether by agreement or operation of an escalation clause herein,
      then, Lessor shall pay Brokers a fee in accordance with the schedule of the
      Brokers in effect at the time of the execution of this Lease.

     

    15.2 Assumption
      of Obligations. Any buyer or transferee of Lessor's interest in this
      Lease shall be deemed to have assumed Lessor's obligation hereunder. Brokers
      shall be third party beneficiaries of the provisions of Paragraphs 1.10, 15,
      22
      and 31, If Lessor, fails to pay to Brokers any amounts due as and for brokerage
      fees pertaining to this Lease when due, then such amounts shall accrue Interest.
      In addition, if Lessor fails to pay any amounts to Lessee's Broker when due,
      Lessee's Broker may send written notice to Lessor and Lessee of such failure
      and
      if Lessor fails to pay such amounts within 10 days after said notice, Lessee
      shall pay said monies to its Broker and offset such amounts against Rent. In
      addition/Lessee's' Broker shall be deemed to be a third party beneficiary of
      any
      commission agreement entered into by and/or between Lessor and Lessor's Broker
      for the limited purpose of collecting any brokerage fee owed.

     

    15.3 Representations
      and Indemnities of Broker Relationships. Lessee and Lessor each
      represent and warrant to the other that it has had no dealings with any person,
      firm, broker or finder (other than the Brokers, if any) in connection with
      this
      Lease, and that no one other than said named Brokers is entitled to any
      commission or finder's fee in connection herewith. Lessee and Lessor do each
      hereby agree to indemnify, protect, defend and hold the other harmless from
      and
      against liability for compensation or charges which may be claimed by any such
      unnamed broker, finder or other similar party by reason of any dealings or
      actions of the indemnifying Party, including any costs, expenses, attorneys'
      fees reasonably incurred with respect thereto.

     

    16. Estoppel
      Certificates.

     

    (a)
      Each
      Party (as "Responding Party") shall within 10 days after
      written notice from the other Party (the "Requesting Party")
      execute, acknowledge and deliver to the Requesting Party a statement in writing
      in form similar to the then most current "Estoppel Certificate"
      form published by the AIR Commercial Real Estate Association, plus such
      additional information, confirmation and/or statements as may be reasonably
      requested by
      the
Requesting
      Party.

    
       

      
        
          
            	
                    

                  	
                    

                  
	
                       
                      Initials

                  	
                    Initials    
                      

                  


          

           

          
            
              	©
                      1998 - AIR Commercial Real Estate Association	
                      REVISED

                    	
                      FORM
                        MTG-3-12/03E

                    


            

          

        

      

       

    

    
      
        
        

      

      
        Page
          9 of
          12

        
          

        

      

      
        
        

      

    

     

    (b) If
      the
      Responding Party shall fail to execute or deliver the Estoppel Certificate
      within such 10
      day
      period, the Requesting Party may execute an Estoppel Certificate stating that:
      (i) the Lease is in full force and effect without modification except as may
      be
      represented by the Requesting Party, (ii) there are no uncured defaults in
      the
      Requesting Party's performance, and (iii) if Lessor is the Requesting Party,
      not
      more than one month's rent has been paid in advance. Prospective purchasers
      and
      encumbrancers may rely upon the Requesting Party's Estoppel Certificate, and
      the
      Responding Party shall be estopped from denying the truth of the facts contained
      in said Certificate.

     

    (c) If
      Lessor
      desires to finance, refinance, or sell the Premises, or any part thereof, Lessee
      and all Guarantors shall deliver to any potential lender or purchaser designated
      by Lessor such financial statements as may be reasonably required by such lender
      or purchaser, including but not limited to Lessee's financial statements for
      the
      past 3
      years.
      All such financial statements shall be received by Lessor and such lender or
      purchaser in confidence and shall be used only for the purposes herein set
      forth.

     

    17. Definition
      of
      Lessor.
      The
      term
"Lessor"as
      used
      herein shall mean the owner or owners at the time in question of the fee title
      to the Premises, or, if this is a sublease, of the Lessee's interest in the
      prior lease. In the event of a transfer of Lessor's title or interest in the
      Premises or this Lease, Lessor shall deliver to the transferee or assignee
      (in
      cash or by credit) any unused Security Deposit held by Lessor. Except as
      provided in Paragraph 15,
      upon
      such
      transfer or assignment and delivery of the Security Deposit, as
      aforesaid,
      the prior
      Lessor
      shall be
      relieved
      of all liability with respect to the obligations and/or covenants under this
      Lease thereafter to be performed by the Lessor. Subject to the foregoing, the
      obligations and/or
      covenants
      in this Lease to be performed by the Lessor shall be binding only upon the
      Lessor as hereinabove defined.

     

    18. Severability.
      The
      invalidity of any provision of this Lease, as determined by a court of competent
      jurisdiction, shall in no way affect the validity of any other provision
      hereof.

     

    19. Days.
      Unless otherwise specifically indicated to the contrary, the word
      "days"as
      used
      in this Lease shall mean and refer to calendar days.

     

    20. Limitation
      on Liability. The
      obligations of Lessor under this Lease shall not constitute personal obligations
      of Lessor, or its partners, members, directors, officers or shareholders, and
      Lessee shall look to the Premises, and to
      no
      other
      assets of Lessor, for the satisfaction of any liability of Lessor with respect
      to this Lease, and shall not seek recourse against Lessor's partners, members,
      directors, officers or shareholders, or any of their personal assets for such
      satisfaction.

     

    21. Time
      of
      Essence.
      Time
      is
      of the essence with respect to the performance of all obligations to be
      performed or observed by the Parties under this Lease.

     

    22. No
      Prior
      or
Other
      Agreements;
      Broker Disclaimer. This
      Lease contains all agreements between the Parties with respect to any matter
      mentioned herein, and no other prior or contemporaneous agreement or
      understanding shall be effective. Lessor and Lessee each represents and warrants
      to the Brokers that it has made, and is relying solely upon, its own
      investigation as to the nature, quality, character and financial responsibility
      of the other Party to this Lease and as to the use, nature, quality and
      character of the Premises. Brokers have no responsibility with respect thereto
      or with respect to any default or breach hereof by either Party. The liability
      (including court costs and attorneys' fees), of any Broker with respect to
      negotiation, execution, delivery or performance by either Lessor or Lessee
      under
      this Lease or any amendment or modification hereto shall be limited to an amount
      up to
      the
      fee
      received by such Broker pursuant to this Lease; provided, however, that the
      foregoing limitation on each Broker's liability shall not be applicable
to
      any
      gross
      negligence or willful misconduct of such Broker.

     

    23. Notices.


    23.1 Notice
      Requirements. All notices required or permitted by this Lease or
      applicable law shall be in writing and may be delivered in person (by hand
      or by
      courier) or may be sent by regular, certified or registered mail or U.S. Postal
      Service Express Mail, with postage prepaid, or by facsimile transmission, and
      shall be deemed sufficiently given if served in a manner specified in this
      Paragraph 23.
      The
      addresses noted adjacent to a Party's signature on this Lease shall be that
      Party's address for delivery or mailing of notices. Either Party may by written
      notice to
      the
      other
      specify a
      different
      address for notice, except that upon Lessee's taking possession of the Premises,
      the Premises shall constitute Lessee's address for notice. A copy of all notices
      to Lessor shall be concurrently transmitted to such party or parties at such
      addresses as Lessor may from time to time hereafter designate in
      writing.

     

    23.2 Date
      of Notice. Any
      notice sent by registered or certified mail, return
      receipt
      requested, shall be deemed given on the date of delivery shown on the receipt
      card, or
      if
      no
      delivery date is shown, the postmark thereon. If sent by regular mail the notice
      shall be deemed given 72
      hours
      after the same is addressed as required herein and mailed with postage prepaid.
      Notices delivered by United States Express Mail or overnight courier that
      guarantee next day delivery shall be deemed given 24
      hours
      after delivery of the same to the Postal Service or
      courier.
      Notices transmitted by facsimile transmission or similar means shall be deemed
      delivered upon telephone confirmation of receipt (confirmation report from
      fax
      machine is sufficient), provided a
      copy
      is
      also
delivered
      via delivery or mail. If notice is received on a Saturday, Sunday or legal
      holiday, it shall be deemed received on the next business day.

     

    24. Waivers.
      No
      waiver
      by Lessor of the Default or Breach of any term, covenant or condition hereof
      by
      Lessee, shall be deemed a waiver of any other term, covenant or condition
      hereof, or of any subsequent Default or Breach by Lessee of the same or of
      any
      other term, covenant or condition hereof. Lessor's consent to, or approval
      of,
      any act shall not be deemed to render unnecessary the obtaining of Lessor's
      consent to, or approval of, any subsequent or similar act by Lessee, or be
      construed as the basis of an estoppel to enforce the provision or provisions
      of
      this Lease requiring such consent. The acceptance of Rent by Lessor shall not
      be
      a waiver of any Default or Breach by Lessee. Any payment by Lessee may be
      accepted by Lessor on account of monies or damages due Lessor, notwithstanding
      any qualifying statements or conditions made by Lessee in connection therewith,
      which such statements and/or conditions shall be of no force or effect
      whatsoever unless specifically agreed to in writing by Lessor at or before
      the
      time of deposit of such payment.

     

    25. Disclosures
      Regarding The Nature of a Real Estate Agency Relationship.

     

    (a) When
      entering into a discussion with a real estate agent regarding a real estate
      transaction, a Lessor or Lessee should from the outset understand
      what type of agency relationship or representation it has with the agent or
      agents in the transaction. Lessor and Lessee acknowledge being advised
      by the Brokers in this transaction, as follows:

     

    (i) Lessor's
      Agent. A
      Lessor's agent under a listing agreement with the Lessor acts as the agent
      for
      the Lessor only. A Lessor's agent
      or
      subagent has the following affirmative obligations: To
      the Lessor: A
      fiduciary duty of utmost care, integrity, honesty, and loyalty in dealings
      with
      the Lessor.
      To
      the Lessee and the Lessor: a.
      Diligent exercise of reasonable skills and care in performance of the agent's
      duties. b. A duty of honest and fair dealing
      and good faith. c. A duty to disclose all facts known to the agent materially
      affecting the value or desirability of the property that are not known to,
      or
within
      the diligent attention and observation of, the Parties. An agent is not
      obligated to reveal to either Party any confidential information obtained from
      the other
      Party which does not involve the affirmative duties set forth
      above.

     

    (ii) Lessee's
      Agent. An
      agent
      can agree to act as agent for the Lessee only. In these situations, the agent
      is
      not the Lessor's agent,
      even if by agreement the agent may receive compensation for services rendered,
      either in full or in part from the Lessor. An agent acting only for a
Lessee
      has the following affirmative obligations. To the Lessee:
      A
      fiduciary duty of utmost care, integrity, honesty, and loyalty in
      dealings
      with the Lessee. To
      the Lessee and the Lessor: a.
      Diligent exercise of reasonable skills and care in performance of the agent's
      duties. b. A
      duty
      of
      honest and fair dealing and
      good
      faith. c. A duty to disclose all facts known to the agent materially affecting
      the value or desirability of
      the
      property that are not known to, or within the
      diligent attention and observation of, the Parties. An agent is not obligated
      to
      reveal to either Party any confidential information obtained from the other
      Party
      which does not involve the affirmative duties set forth above.

     

    (iii) Agent
      Representing Both Lessor and Lessee. A
      real
      estate agent, either acting directly or through one or more associate
licenses,
      can legally be the agent of both the Lessor and the Lessee in a transaction,
      but
      only with the knowledge and consent of both the Lessor and the Lessee.
      In a dual agency situation, the agent has the following affirmative obligations
      to both the Lessor and the Lessee: a. A fiduciary duty of utmost care,
integrity,
      honesty and loyalty in the dealings with either Lessor or the Lessee. b. Other
      duties to the Lessor and the Lessee as stated above in subparagraphs
(i)
      or
      (ii). In representing both Lessor and Lessee, the agent may not without the
      express permission of the respective Party, disclose to the other Party that
      the
      Lessor will accept rent in an amount less than that indicated in the listing
      or
      that the Lessee is willing to pay a higher rent than that offered. The above
      duties
      of
      the agent in a real estate transaction do not relieve a Lessor or Lessee from
      the responsibility to protect their own interests. Lessor and Lessee
should
      carefully read all agreements to assure that they adequately express their
      understanding of the transaction. A real estate agent is a person qualified
      to
advise
      about real estate. If legal or tax advise is desired, consult a competent
      professional.

     

    (b) Brokers
      have no responsibility with respect to any default or breach hereof by either
      Party. The Parties agree that no lawsuit or other legal proceeding involving
      any
      breach of duty, error or omission relating to this Lease may be brought against
      Broker more than one year after the Start Date and that the liability (including
      court costs and attorneys' fees), of any Broker with respect to any such lawsuit
      and/or legal proceeding shall not exceed the fee received by such Broker
      pursuant to this Lease; provided, however, that the foregoing limitation on
      each
      Broker's liability shall not be applicable to any gross negligence or willful
      misconduct of such Broker. 

     

    (c) Buyer
      and
      Seller agree to identify to Brokers as "Confidential" any communication or
      information given Brokers that is considered by such Party to be
      confidential.

     

    26. No
      Right To Holdover. Lessee
      has no right to retain possession of the Premises or any part thereof beyond
      the
      expiration or termination of this Lease. In the event that Lessee holds over,
      then the Base Rent shall be
      increased
      to 150%
      of
      the
      Base Rent applicable immediately preceding the expiration or termination.
      Nothing contained herein shall be construed as consent by
      Lessor
      to
      any
      holding over by Lessee.

     

    27. Cumulative
      Remedies. No
      remedy
      or
election
      hereunder shall be
      deemed
      exclusive but shall, wherever possible, be
      cumulative
      with all other remedies at
      law
      or in
      equity.

     

    28. Covenants
      and Conditions; Construction of Agreement. All
      provisions of
      this
      Lease to
      be
      observed or
      performed
      by
      Lessee
      are both covenants and conditions. In construing this Lease, all headings and
      titles are for the convenience of
      the
      Parties only and shall not be considered a part of
      this
      Lease. Whenever required by
      the
      context, the singular shall include the plural and vice versa. This Lease shall
      not be
      construed
      as if prepared by
      one
      of
      the
      Parties, but rather according to
      its
      fair
      meaning as a whole, as if both Parties had prepared it.

     

    29. Binding
      Effect; Choice of Law. This
      Lease shall be
      binding
      upon the parties, their personal representatives, successors and assigns and
      be
      governed
      by the
      laws
of
      the
      State
      in which the Premises are
      located.
      Any litigation between the Parties hereto concerning this Lease shall
be
      initated
      in
      the
county
      in
      which the Premises are located.

    
       

      
        
          
            	
                    

                  	
                    

                  
	
                       
                      Initials

                  	
                    Initials    
                      

                  


          

           

          
            
              	©
                      1998 - AIR Commercial Real Estate Association	
                      REVISED

                    	
                      FORM
                        MTG-3-12/03E

                    


            

          

        

      

       

    

    
      
        
        

      

      
        Page
          10
          of 12

        
          

        

      

      
        
        

      

    

     

    30. Subordination;
      Attornment; Non-Disturbance.

     

    30.1 Subordination.
      This
      Lease and any Option granted hereby shall be subject and subordinate to any
      ground lease, mortgage, deed of trust, or other hypothecation or security device
      (collectively, "Security
      Device"), now
      or
      hereafter placed upon the Premises, to any and all advances made on the security
      thereof, and to all renewals, modifications, and extensions thereof. Lessee
      agrees that the holders of any such Security Devices (in this Lease together
      referred to as "Lender")
      shall
      have no liability or obligation to perform any of the obligations of Lessor
      under this Lease. Any Lender may elect to have this Lease and/or any Option
      granted hereby superior to the lien of its Security Device by giving written
      notice thereof to Lessee, whereupon this Lease and such Options shall be deemed
      prior to such Security Device, notwithstanding the relative dates of the
      documentation or recordation thereof.

     

    30.2 Attornment.
      In
      the
      event that Lessor transfers title to the Premises, or the Premises are acquired
      by another upon the foreclosure or termination of a Security Device to which
      this Lease is subordinated (i) Lessee shall, subject to the non-disturbance
      provisions of Paragraph 30.3,
      attorn
      to
      such new owner, and upon request, enter into a new lease, containing all of
      the
      terms and provisions of this Lease, with such new owner for the remainder of
      the
      term hereof, or, at the election of the new owner, this Lease will automatically
      become a new lease between Lessee and such new owner, and (ii)
      Lessor
      shall thereafter be relieved of any further obligations hereunder and such
      new
      owner shall assume all of Lessor's obligations, except that such new owner
      shall
      not: (a) be liable for any act or omission of any prior lessor or with respect
      to events occurring prior to acquisition of ownership; (b) be subject to any
      offsets or defenses which Lessee might have against any prior lessor, (c) be
      bound by prepayment of more than one month's rent, or (d) be liable for the
      return of any security deposit paid to any prior lessor.

     

    30.3 Non-Disturbance.
      With
      respect to Security Devices entered into by Lessor after the execution of this
      Lease, Lessee's subordination of this Lease shall be subject to receiving a
      commercially reasonable non-disturbance agreement (a "Non-Disturbance
      Agreement")from
      the
      Lender which Non-Disturbance Agreement provides that Lessee's possession of
      the
      Premises, and this Lease, including any options to extend the term hereof,
      will
      not be disturbed so long as Lessee is not in Breach hereof and attorns to the
      record owner of the Premises. Further, within 60
      days
      after the execution of this Lease, Lessor shall use its commercially reasonable
      efforts to obtain a Non-Disturbance Agreement from the holder of any
      pre-existing Security Device which is secured by the Premises. In the event
      that
      Lessor is unable to provide the Non-Disturbance Agreement within said
60
      days,
      then Lessee may, at Lessee's option, directly contact Lender and attempt to
      negotiate for the execution and delivery of a Non-Disturbance
      Agreement.

     

    30.4 Self-Executing.
      The
      agreements contained in this Paragraph 30
      shall
      be
      effective without the execution of any further documents; provided, however,
      that, upon written request from
      Lessor
      or
      a Lender in connection with a sale, financing or refinancing of the Premises,
      Lessee and Lessor shall execute such further writings as may be reasonably
      required to separately document any subordination, attornment and/or
      Non-Disturbance Agreement provided for herein.


    31. Attorneys’
      Fees.
      If any Party or Broker brings an action or proceeding involving the Premises
      whether founded in tort, contract or equity, or to declare rights hereunder,
      the
      Prevailing Party (as hereafter defined) in any such proceeding, action, or
      appeal thereon, shall be entitled to reasonable attorneys’ fees. Such fees may
      be awarded in the same suit or recovered in a separate suit, whether or not
      such
      action or proceeding is pursued to decision or judgment. The term, "Prevailing
      Party" shall
      include, without limitation, a Party or Broker who substantially obtains or
      defeats the relief sought, as the case may be, whether by compromise,
      settlement, judgment, or the abandonment by the other Party or Broker of its
      claim or
      defense.
      The attorneys’ fees award shall not be computed in
      accordance
      with any court fee schedule, but shall be such as to fully reimburse all
      attorneys' fees reasonably incurred. In addition, Lessor shall be entitled
      to
      attorneys' fees, costs and expenses incurred in
      the
      preparation and service of notices of Default and consultations in connection
      therewith, whether or not a legal action is subsequently commenced in connection
      with such Default or
      resulting
      Breach ($200
      is
      a
      reasonable minimum per occurrence for such services and
      consultation).

     

    32. Lessor's
      Access; Showing Premises; Repairs. Lessor
      and Lessor's agents shall have the right to enter the Premises at any time,
      in
      the case of an emergency, and otherwise at reasonable times after reasonable
      prior notice for the purpose of showing the same to prospective purchasers,
      lenders, or tenants, and making such alterations, repairs, improvements or
      additions to the Premises as Lessor may deem necessary or desirable and the
      erecting, using and maintaining of utilities, services, pipes and conduits
      through the Premises and/or other premises as long as there is no material
      adverse effect on Lessee's use of the Premises. All such activities shall be
      without abatement of rent or liability to Lessee.

     

    33. Auctions.
      Lessee
      shall not conduct, nor permit to be conducted, any auction upon the Premises
      without Lessor’s prior written consent. Lessor shall not be obligated to
      exercise any standard of reasonableness in
      determining
      whether to permit an auction.

     

    34. Signs.
      Lessor
      may place on the Premises ordinary "For Sale" signs at any time and ordinary
      "For Lease" signs during the last 6
      months
      of
      the term hereof. Except for ordinary "For Sublease" signs which may be placed
      only on the Premises, Lessee shall not place any sign upon the Project without
      Lessor's prior written consent. All signs must comply with all Applicable
      Requirements.

     

    35. Termination;
      Merger. Unless
      specifically stated otherwise in
      writing
      by Lessor, the voluntary or other surrender of this Lease by Lessee, the mutual
      termination or cancellation hereof, or a termination hereof by Lessor for Breach
      by Lessee, shall automatically terminate any sublease or lesser estate in the
      Premises; provided, however, that Lessor may elect to continue any one or all
      existing subtenancies. Lessor's failure within 10
      days
      following any such event to elect to the contrary by written notice to the
      holder of any such lesser interest, shall constitute Lessor's election to have
      such event constitute the termination of such interest.

     

    36. Consents.
      Except
      as
      otherwise provided herein, wherever in this Lease the consent of a Party is
      required to an act by or for the other Party, such consent shall not be
      unreasonably withheld or delayed. Lessor's actual reasonable costs and expenses
      (including but not limited to architects', attorneys', engineers' and other
      consultants' fees) incurred in the consideration of, or response to, a request
      by Lessee for any Lessor consent, including but not limited to consents to
      an
      assignment, a subletting or the presence or use of a Hazardous Substance, shall
      be paid by Lessee upon receipt of an invoice and supporting documentation
      therefor. Lessor's consent to any act, assignment or subletting shall not
      constitute an acknowledgment that no Default or Breach by Lessee of this Lease
      exists, nor shall such consent be deemed a waiver of any then existing Default
      or Breach, except as may be otherwise specifically stated in writing by Lessor
      at the time of such consent. The failure to specify herein any particular
      condition to Lessor's consent shall not preclude the imposition by Lessor at
      the
      time of consent of such further or other conditions as are then reasonable
      with
      reference to the particular matter for which consent is being given. In the
      event that either Party disagrees with any determination made by the other
      hereunder and reasonably requests the reasons for such determination, the
      determining party shall furnish its reasons in writing and in reasonable detail
      within 10
      business
      days following such request.

     

    37. Guarantor.


    37.1 Execution.
      The
      Guarantors, if any, shall each execute a guaranty in
      the
      form
      most recently published by the AIR Commercial Real Estate
      Association.

     

    37.2 Default.
      Itshall
      constitute a Default of the Lessee if any Guarantor fails or refuses, upon
      request to provide: (a) evidence of the execution of the guaranty, including
      the
      authority of the party signing on Guarantor's behalf to obligate Guarantor,
      and
in
      the
      case
      of
      a
      corporate Guarantor, a certified copy of a resolution of its board of directors
      authorizing the making of such guaranty, (b) current financial statements,
      (c)
      an Estoppel Certificate, or (d) written confirmation that the guaranty is still
      in
      effect.


    38. Quiet
      Possession. Subject
      to payment by Lessee of the Rent and performance of all of the covenants,
      conditions and provisions on Lessee's part to be observed and performed under
      this Lease, Lessee shall have quiet possession and quiet enjoyment of the
      Premises during the term hereof.

     

    39. Options.
      If
      Lessee
      is granted an option, as defined below, then the following provisions shall
      apply.


    39.1 Definition.
      "Option" shall
      mean: (a) the right to extend the term of or renew this Lease or to extend
      or
      renew any lease that Lessee has on other property of Lessor; (b) the right
      of
      first refusal or first offer to lease either the Premises or other property
      of
      Lessor; (c) the right to purchase or the right of first refusal to purchase
      the
      Premises or other property of Lessor.

     

    39.2 Options
      Personal To Original Lessee. Any
      Option granted to Lessee in this Lease is personal to the original Lessee,
      and
      cannot be assigned or exercised by anyone other than said original Lessee and
      only while the original Lessee is
      in
      full
      possession of the Premises and, if requested by Lessor, with Lessee certifying
      that Lessee has no intention of thereafter assigning or subletting.

     

    39.3 Multiple
      Options. In
      the
      event that Lessee has any multiple Options to extend or renew this Lease, a
      later Option cannot be exercised unless the prior Options have been validly
      exercised.

     

    39.4 Effect
      of Default on Options.

     

    (a) Lessee
      shall have no right to exercise an Option: (i) during the period commencing
      with
      the giving of any notice of Default and continuing until said Default is cured,
      (ii) during the period of time any Rent is unpaid (without regard to whether
      notice thereof is given Lessee), (iii) during the time Lessee is in Breach
      of
      this Lease, or (iv) in the event that Lessee has been given 3
      or
      more
      notices of separate Default, whether or not the Defaults are cured, during
      the
12
      month
      period immediately preceding the exercise of the Option.

     

    (b) The
      period of time within which an Option may be exercised shall not be extended
      or
      enlarged by reason of Lessee's inability to exercise an Option because of the
      provisions of Paragraph 39.4(a).

     

    (c) An
      Option
      shall terminate and be of no further force or effect, notwithstanding Lessee's
      due and timely exercise of the Option, if, after such exercise and prior to
      the
      commencement of the extended term or completion of the purchase, (i) Lessee
      fails to pay Rent for a period of 30
      days
      after such Rent becomes due (without any necessity of Lessor to give notice
      thereof), or (ii) if Lessee commits a Breach of this Lease.

     

    40. Security
      Measures. Lessee
      hereby acknowledges that the Rent payable to Lessor hereunder does not include
      the cost of guard service or other security measures, and that Lessor shall
      have
      no obligation whatsoever to provide same. Lessee assumes all responsibility
      for
      the protection of the Premises, Lessee, its agents and invitees and their
      property from the acts of third parties.

     

    41. Reservations.
      Lessor
      reserves the right: (i) to grant, without the consent or joinder of Lessee,
      such
      easements, rights and dedications that Lessor deems necessary, (ii) to cause
      the
      recordation of parcel maps and restrictions, and (iii) to create and/orinstall
      new utility raceways, so long as such easements, rights, dedications, maps,
      restrictions, and utility raceways do not unreasonably interfere with the use
      of
      the Premises by
      Lessee.
      Lessee agrees to sign any documents reasonably requested by Lessor to effectuate
      such rights.

     

    42. Performance
      Under Protest. If
      at any
      time a dispute
      shall
      arise as to any amount
      or
      sum of
      money to be paid by one Party to the other under the provisions
      hereof, the Party against whom the obligation to pay the money is asserted
      shall
      have the right to make payment "under protest" and such payment shall not be
      regarded as a voluntary payment and there shall survive the right on the part
      of
      said Party to institute suit for recovery of such sum. If it shall be adjudged
      that there was no legal obligation on the part of said Party to pay such sum
      or
      any part thereof, said Party shall be entitled to recover such sum or so much
      thereof as it was not legally required to pay. A Party who does not initiate
      suit for the recovery of sums paid "under protest" within 6 months shall be
      deemed to have waived its right to protest such payment.

     

    
      
        
          	
                  

                	
                  

                
	
                     
                    Initials

                	
                  Initials    
                    

                


        

         

        
          
            	©
                    1998 - AIR Commercial Real Estate Association	
                    REVISED

                  	
                    FORM
                      MTG-3-12/03E

                  


          

        

      

       

      
        
          
          

        

        
          Page
            11
            of 12

          
            

          

        

        
          
          

        

      

    

     

    43. Authority;
      Multiple Parties; Execution.

     

    (a) If
      either
      Party hereto is a corporation, trust, limited liability company, partnership,
      or
      similar entity, each individual executing this Lease on behalf of such entity
      represents and warrants that he or she is duly authorized to execute and deliver
      this Lease on its behalf. Each Party shall, within 30 days after request,
      deliver to the other Party satisfactory evidence of such authority.

     

    (b) If
      this
      Lease is executed by more than one
      person
      or
      entity as "Lessee", each such person or entity shall be jointly and severally
      liable hereunder. It is agreed that any one of the named Lessees shall be
      empowered to execute any amendment to this Lease, or other document ancillary
      thereto and bind all of the named Lessees, and Lessor may rely on the same
      as if
      all of the named Lessees had executed such document.

     

    (c) This
      Lease may be executed by the Parties in counterparts, each of which shall be
      deemed
      an
      original and all of which together shall constitute one and the same
      instrument.


    44. Conflict.
      Any
      conflict between the printed provisions of this Lease and the typewritten or
      handwritten provisions shall be controlled by the typewritten or handwritten
      provisions.

     

    45. Offer.
      Preparation
      of this Lease by either party or their agent and submission of same to the
      other
      Party shall not be deemed an offer to lease to the other Party. This Lease
      is
      not intended to be binding until executed and delivered by all Parties
      hereto.

     

    46. Amendments.
      This Lease may be modified only in writing, signed by the Parties in interest
      at
      the time of the modification. As long as they do not materially change Lessee's
      obligations hereunder, Lessee agrees to make such reasonable non-monetary
      modifications to this Lease as may be reasonably required by a Lender in
      connection with the obtaining of normal financing or refinancing of the
      Premises.

     

    47. Waiver
      of Jury Trial. THE PARTIES HEREBY WAIVE THEIR RESPECTIVE RIGHTS TO TRIAL BY
      JURY
      IN ANY ACTION OR PROCEEDING INVOLVING THE PROPERTY OR ARISING OUT OF THIS
      AGREEMENT.

     

    48. Mediation
      and
      Arbitrationof
      Disputes. An
      Addendum requiring the Mediation and/or the Arbitration of disputes between
      the
      Parties and/or Brokers arising out of this Lease þ
      is o is not attached
      to this
      Lease.

     

    49. Americans
      with Disabilities Act. Since
      compliance with the Americans with Disabilities Act (ADA) is dependent
      upon
      Lessee's specific use of the Premises, Lessor makes no warranty or
      representation as to whether or not the Premises comply with ADA or any similar
      legislation. In the event that Lessee's use of the Premises requires
      modifications or additions to the Premises in order to be in ADA compliance,
      Lessee agrees to make any such necessary modifications and/or additions at
      Lessee's expense.

     

    LESSOR
      AND LESSEE HAVE CAREFULLY READ AND REVIEWED THIS LEASE AND EACH TERM AND
      PROVISION CONTAINED HEREIN, AND BY THE EXECUTION OF THIS LEASE SHOW THEIR
      INFORMED AND VOLUNTARY CONSENT THERETO. THE PARTIES HEREBY AGREE THAT, AT THE
      TIME THIS LEASE IS EXECUTED, THE TERMS OF THIS LEASE ARE COMMERCIALLY REASONABLE
      AND EFFECTUATE THE INTENT
      AND
      PURPOSE OF LESSOR AND LESSEE WITH RESPECT TO THE PREMISES.

     

    ATTENTION:
      NO
      REPRESENTATION OR RECOMMENDATION IS MADE BY THE AIR COMMERCIAL REAL ESTATE
      ASSOCIATION OR BY ANY BROKER
      AS
      TO
      THE
      LEGAL
      SUFFICIENCY, LEGAL EFFECT, OR TAX CONSEQUENCES OF THIS LEASE OR THE TRANSACTION
      TO WHICH IT RELATES.
      THE
      PARTIES ARE URGED TO:

     

    1. SEEK
      ADVICE OF COUNSEL AS TO THE LEGAL AND TAX CONSEQUENCES OF THIS
      LEASE.

     

    2. RETAIN
      APPROPRIATE CONSULTANTS TO REVIEW AND INVESTIGATE THE CONDITION OF THE PREMISES.
      SAID INVESTIGATION SHOULD INCLUDE BUT NOT BE LIMITED TO: THE POSSIBLE PRESENCE
      OF HAZARDOUS SUBSTANCES, THE ZONING OF THE PREMISES, THE STRUCTURAL INTEGRITY,
      THE CONDITION OF THE ROOF AND OPERATING SYSTEMS, COMPLIANCE WITH THE AMERICANS
      WITH DISABILITIES ACT AND THE SUITABILITY OF THE PREMISES FOR LESSEE'S INTENDED
      USE.

     

    WARNING:
      IF THE PREMISES ARE LOCATED IN A STATE OTHER THAN CALIFORNIA, CERTAIN PROVISIONS
      OF THE LEASE MAY NEED TO BE REVISED TO COMPLY WITH THE LAWS OF THE STATE IN
      WHICH THE PREMISES ARE LOCATED.

    The
      parties hereto have executed this Lease at
      the
      place
      and
      on
      the dates
      specified
      above
      their
      respective signatures.

    

      
        	
                Executed at: 

              	
                          
                  

              	
                 

              	
                Executed at:

              	
                SANTA ANA

              
	
                on: 

              	
                RBB 3, 2005

              	
                 

              	
                on:

              	
                2/2/05

              


      

       

      
        	
                By LESSOR:

              	
                 

              	
                By LESSEE:

              
	
                AGA Partners

              	
                 

              	
                The Vinyl Fence Company, Inc.

              
	
                 

              	
                 

              	
                 

              


      

      

        
          	
                  By: 

                	
                  

                	
                   

                	
                  By: 

                	
                   
/
 

                


        

      

      
        
          	
                  Name Printed: 

                	
                  Richard J. Adams

                	
                   

                	
                  Name Printed: 

                	
                  Gordon M. Knott / GARY KHATCHOYAN

                


        

      

      
        
          	
                  Title: 

                	
                  Managing Partner

                	
                   

                	
                  Title: 

                	
                  President / CFO

                


        
 

      
        
          	
                  By:

                	
                                  
                    

                	
                   

                	
                  By:

                	
                                 
                    

                


        

        
          	
                  Name Printed:

                	
                                 
                    

                	
                   

                	
                  Name Printed:

                	
                                     
                    

                


        

        
          	
                  Title:

                	
                                         
                    

                	
                   

                	
                  Title:

                	
                                       
                         

                


        

        
          	
                  Address: 

                	
                  1712 E. Newport Circle, Suite A

                	
                   

                	
                  Address: 

                	
                   

                
	Santa
                  Ana, CA 92705	 	
                  3301 S. Harbor Blvd., Suite 112

                
	       
                            	 	Santa
                  Ana, CA 92704


        

      

       

      
        	
                Telephone:

              	
                (714)
                  979-2020

              	
                 

              	
                Telephone: 

              	
                (714)
                  210-8888 x304

              
	
                Facsimile: 

              	
                (714) 979-1033

              	
                 

              	
                Facsimile: 

              	
                (           )

              
	
                Federal ID No.

              	
                                
                  

              	
                 

              	
                Federal ID No.

              	
                              
                  

              


      

    

     

    These
      forms are often modified to meet changing requirements of law and needs of
      the
      industry. Always write or call to make sure you are utilizing the most current
      form: AIR COMMERCIAL REAL ESTATE ASSOCIATION, 700 South Flower Street, Suite
      600, Los Angeles, CA 90017. (213) 687-8777.

     

    ©
      Copyright 1998-By AIR Commercial Real Estate Association.

    All
      rights reserved.

    No
      part of these works may be reproduced in any form without permission in
      writing.

     

    
      
        	
                

              	
                

              
	
                   
                  Initials

              	
                Initials    
                  

              


      

       

      
        
          	©
                  1998 - AIR Commercial Real Estate Association	
                  REVISED

                	
                  FORM
                    MTG-3-12/03E

                


        

      

    

     

    
      
        
        

      

      
        Page
          12
          of 12

        
          

        

      

      
        
        

      

    

     

    
      
        		
                AIR
                  COMMERCIAL REAL ESTATE ASSOCIATION

              	 


      

    

    GUARANTY
      OF LEASE

     

    WHEREAS,
      AGA Partners, hereinafter "Lessor", and The Vinyl Fence Company,
      Inc., hereinafter "Lessee", are about to execute a document entitled "Lease"
      dated January 31, 2005 concerning the premises commonly known as
2210 S. Ritchey Street, Santa Ana, CA 92705 wherein Lessor will lease the
      premises to Lessee, and

     

    WHEREAS,
      Gordon
      M. Knott hereinafter
      "Guarantors" have a financial interest in Lessee, and

     

    WHEREAS,
      Lessor would not execute the Lease if Guarantors did not execute and deliver
      to
      Lessor this Guarantee of Lease.

     

    NOW
      THEREFORE, in consideration of the execution of the foregoing Lease by Lessor
      and as a material inducement to Lessor to execute said Lease, Guarantors hereby
      jointly, severally, unconditionally and irrevocably guarantee the prompt payment
      by Lessee of all rents and all other sums payable by Lessee under said Lease
      and
      the faithful and prompt performance by Lessee of each and every one of the
      terms, conditions and covenants of said Lease to be kept and performed by
      Lessee.

     

    It
      is
      specifically agreed that the terms of the foregoing Lease may be modified by
      agreement between Lessor and Lessee, or by a course of conduct, and said Lease
      may be assigned by Lessor or any assignee of Lessor without consent or notice
      to
      Guarantors and that this Guaranty shall guarantee the performance of said Lease
      as so modified.

     

    This
      Guaranty shall not be released, modified or affected by the failure or delay
      on
      the part of Lessor to enforce any of the rights or remedies of the Lessor under
      said Lease, whether pursuant to the terms thereof or at law or in
      equity.

     

    No
      notice
      of default need be given to Guarantors, it being specifically agreed that the
      guarantee of the undersigned is a continuing guarantee under which Lessor may
      proceed immediately against Lessee and/or against Guarantors following any
      breach or default by Lessee or for the enforcement of any rights which Lessor
      may have as against Lessee under the terms of the Lease or at law or in
      equity.

     

    Lessor
      shall have the right to proceed against Guarantors hereunder following any
      breach or default by Lessee without first proceeding against Lessee and without
      previous notice to or demand upon either Lessee or Guarantors.

     

    Guarantors
      hereby waive (a) notice of acceptance of this Guaranty, (b) demand of payment,
      presentation and protest, (c) all right to assert or plead any statute of
      limitations relating to this Guaranty or the Lease, (d) any right to require
      the
      Lessor to proceed against the Lessee or any other Guarantor or any other person
      or entity liable to Lessor, (e) any right to require Lessor to apply to any
      default any security deposit or other security it may hold under the Lease,
      (f)
      any right to require Lessor to proceed under any other remedy Lessor may have
      before proceeding against Guarantors, (g) any right of subrogation.

     

    Guarantors
      do hereby subrogate all existing or future indebtedness of Lessee to Guarantors
      to the obligations owed to Lessor under the Lease and this
      Guaranty.

     

    If
      a
      Guarantor is married, such Guarantor expressly agrees that recourse may be
      had
      against his or her separate property for all of the obligations
      hereunder.

     

    The
      obligations of Lessee under the Lease to execute and deliver estoppel statements
      and financial statements, as therein provided, shall be deemed to also require
      the Guarantors hereunder to do and provide the same.

     

    The
      term
      "Lessor" refers to and means the Lessor named in the Lease and also Lessor's
      successors and assigns. So long as Lessor's interest in the Lease, the leased
      premises or the rents, issues and profits therefrom, are subject to any mortgage
      or deed of trust or assignment for security, no acquisition by Guarantors of
      the
      Lessor's interest shall affect the continuing obligation of Guarantors under
      this Guaranty which shall nevertheless continue in full force and effect for
      the
      benefit of the mortgagee, beneficiary, trustee or assignee under such mortgage,
      deed of trust or assignment and their successors and assigns.

     

    The
      term
      "Lessee" refers to and means the Lessee named in the Lease and also Lessee's
      successors and assigns.

     

    In
      the
      event any action be brought by said Lessor against Guarantors hereunder to
      enforce the obligation of Guarantors hereunder, the unsuccessful party in such
      action shall pay to the prevailing party therein a reasonable attorney's fee
      which shall be fixed by the court.

     

    If
      this Form has been filled in, it has been prepared for submission to your
      attorney for his approval. No representation or recommendation is made by the
      AIR Commercial Real Estate Association, the real estate broker or its agents
      or
      employees as to the legal sufficiency, legal effect, or tax consequences of
      this
      Form or the transaction relating thereto.

    

      
        	
                Executed
                  at

              	          
                	 	
                

              
	
                on

              	         
	 	
                Gordon
                  M.
                  Knott

              
	
                Address

              	           
                	 	 
	          
	 	
                "GUARANTORS"

              


      

      
         

        
          
            	©1996
                    - AIR Commercial Real Estate Association	
                      

                  	
                    FORM
                      GR-1-12/96E

                  


          

        

      

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    RULES
      & REGULATIONS

     

    FOR
      STANDARD INDUSTRIAL/COMMERCIAL MULTI-TENANT LEASE –
GROSS

    BY
      AND BETWEEN AGA PARTNERS, LESSOR, AND

    THE
      VINYL FENCE COMPANY, INC., LESSEE,

    FOR
      THE PREMISES KNOWN AS 2210 S. RITCHEY STREET, SANTA ANA, CA
      92705

    DATED
      JANUARY 31, 2005

     

    General
      Rules and Regulations.

     

    1. Activities
      of Lessee are to be performed inside the walls of the unit. Outside areas are
      to
      be used only for parking (in designated spaces) and the occasional loading
      and
      unloading of cargo. Disabled or dismantled vehicles are not to be parked or
      stored on the Premises and may be towed away without prior notice.

     

    2. All
      uses
      must be approved by the applicable City, Fire Department and any other governing
      agency. In addition, any and all Tenant Improvements must be permitted (as
      may
      be required) by the applicable City.

     

    3. Sewer
      and
      storm drains are not to be used for the disposal of any substance other than
      that for which they are designed.

     

    4. High-pile
      storage is prohibited by the Fire Code.

     

    5. Hazardous
      or extremely flammable materials are not to be used or stored on the Premises
      except as otherwise permitted in Paragraph 6.2 of the Lease.

     

    6. Lessee
      will adhere strictly to the uniform sign program as specified in the Lease
      or
      other sign criteria by Lessor and the CC&R's of the project if any. No
      advertisement or notice shall be affixed on any part of the building or Premises
      without the prior written consent of Lessor.

     

    7. Area
      over
      office is not designed to support heavy loads and should be restricted to
      minimal storage. In the case of a T-Bar ceiling, no storage is
      allowed.

     

    8. No
      equipment shall be installed outside the walls of the unit unless approved
      in
      writing by Lessor. Any such use shall be screened from view and maintained
      in a
      clean and well-kept manner.

     

    9. The
      trash
      bin, if provided by Lessor, must be maintained by Lessee. No liquid or hazardous
      waste is to be disposed of in bin. Lessee shall keep its unit and adjacent
      common area reasonably clean and free of trash, refuse, debris,
      etc.

     

    10. No
      awnings or other projection shall be attached to or hung in, or used in
      connection with, any window or door of the Premises other than standard mini
      blinds. Neither the interior nor exterior of any windows shall be coated or
      otherwise sun-screened without the express written consent of
      Lessor.

     

    11. No
      birds
      or animals of any kind shall be brought into or kept in or about the Premises,
      and no cooking shall be done or permitted by Lessee except that the preparation
      of coffee, tea, etc. for tenants and their employees shall be permitted. Lessee
      shall not cause nor permit any unusual or objectionable odors to be produced
      or
      to permeate the Premises.

     

    12. The
      Premises shall not be used for lodging or sleeping or for any immoral or illegal
      purposes.

     

    13. Lessee
      shall not make, nor permit to be made, any unseemly or disturbing noises or
      disturb or interfere with occupants of this or neighboring buildings or Premises
      or those having business with them, whether by the use of any musical
      instrument, radio, phonograph, unusual noise, nor in any other way. No tenant
      or
      any of tenant's servants, employees, agents, visitors or licensees shall at
      any
      time bring or keep upon the Premises any inflammable, combustible or explosive
      fluid, chemical or substance.

     

    14. No
      additional locks or bolts of any kind shall be placed upon any of the doors
      by
      Lessee, nor shall any changes be made in existing locks or the mechanism thereof
      without express written consent of Lessor. Lessee must, upon the termination
      of
      his tenancy, restore to Lessor all keys of entry doors and interior offices,
      either furnished to, or otherwise procured by Lessee and in the event of the
      loss of any keys furnished to Lessee, Lessee shall pay for the cost of replacing
      the same or of changing the lock or locks opened by such lost key if Lessor
      shall deem it necessary to make such change.

     

    15. Canvassing,
      soliciting and peddling in the Project are prohibited and Lessee shall cooperate
      to prevent the same.

     

    16. Lessor
      reserves the right by written notice to rescind, alter or waive any rule or
      regulation at any time prescribed
      for the Project when, in Lessor's judgment, it is in the best interest of the
      Project and its Tenants. Lessor reserves
      the right to make additions to the rules and regulations stated herein and
      any
      future rules and regulations, which are
      adopted.

     

    
      
        
          	
                  

                	
                  

                
	
                     
                    Initials

                	
                  Initials    
                    

                


        

         

        
          
            	A.R&R
                    AGA	
                    1
                      of 1

                  	
                    Rules
                      & Regulations MTG

                  


          

           

        

      

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    ADDENDUM

     

    TO
      STANDARD INDUSTRIAL/COMMERCIAL MULTI-TENANT LEASE –
GROSS

     

    BY
      AND BETWEEN AGA PARTNERS, LESSOR,

    AND
      THE VINYL FENCE COMPANY, INC., LESSEE,

    FOR
      THE PREMISES KNOWN AS 2210 S. RITCHEY STREET, SANTA ANA, CA
      92705

    DATED
      JANUARY 31, 2005

     

    Paragraph(s)
      50 - 52

     

    50.
      Base Rent Adjustment. The
      monthly base rental for the term of the lease shall be adjusted as
      follows:

     

    
      	
              Months

            	    	
              Monthly Base Rent*

            	 
	
              01
                -12:

            	 	
              $

            	
              7,980.00

            	 
	
              13 - 24:

            	 	
              $

            	
              8,210.00

            	 
	
              25
                - 36:

            	 	
              $

            	
              8,445.00

            	 
	
              37 - 48:

            	 	
              $

            	
              8,690.00

            	 


    

     

    *The
      monthly base rent includes $.04 per square foot towards tenant improvements.
      Lessee is responsible for all utilities and trash removal services.

     

    51.
      Lessor's Tenant Improvements. Lessor,
      at Lessor's expense, shall provide the following tenant improvements (see also
      attached Floor Plan):

     

    
      	
            	(a)	
              Separate
                units 2210 and 2200 by closing all openings in the demised
                wall.

            


    

    
      	
            	(b)	
              Remove
                all existing walls in the rear portion of the
                building.

            


    

    
      
        
          	
                	(c)	
                  Construct
                    a showroom approximately 24'x 44', a break room approximately
                    10'x 11',
                    two (2) complete restrooms and (2) offices approximately 12'x
                    14'
                    including one (1) 4'x 4' window in each office complete with
                    HVAC, carpet
                    and paint.

                


        

      

    

    
      	
            	
              (d)

            	
              Replace
                south truck door.

            


    

    
      	
            	(e)	
              Remove
                wood coverings from front windows.

            


    

    
      	
            	(f)	
              Clean
                and paint warehouse as may be
                necessary.

            


    

    
      	
            	(g)	
              Ensure
                all electrical, plumbing and mechanical systems (including HVAC)
                are in
                proper working order.

            


    

     

    52.
      Lessee's Contribution. Lessee
      shall contribute $10,000.00 upon lease execution and $.04 per square foot over
      the term of the Lease ($380 per month) towards Tenant Improvement costs as
      noted
      in Paragraph 50, Base Rent Adjustment.

     

    
      	
              

            	 
              	 	
              

            
	
                 
                Initials:

            	 
              	   	
              
                
                  
                    Initials:   
                      

                  

                

              

            


    

    
      
         

        
          
            	A.Add
                    AGA-2210 Ritchey	
                    Page
                      1 of 1

                  	
                    Addendum-MTG

                  


          

           

          
            
              
              

            

            
              
              

              
                

              

            

            
              
              

            

          

           

        

      

    

    
      
        
          		
                  
                    ARBITRATION
                      AGREEMENT

                  

                	 
	 
                  	
                  Standard
                    Lease Addendum

                	 
                  


        

      

    

     

    
      
        	
                Dated  

              	
                January 31, 2005

              


      

       

      
        	
                By and Between (Lessor)  

              	
                AGA partners

              
	 
	
                  (Lessee)  

              	
                The Vinyl Fence Company, Inc.

              


      

       

      
        	
                Address of Premises  

              	
                2210 S. Ritchey Street, Santa Ana, CA 92705

              


      

    

     

    Paragraph
      53     

     

    A. ARBITRATION
      OF DISPUTES:

    Except
      as
      provided in Paragraph B below, the Parties agree to resolve any and all claims,
      disputes or disagreements arising under this Lease, including, but not limited
      to any matter relating to Lessor's failure to approve an assignment, sublease
      or
      other transfer of Lessee's interest in the Lease under Paragraph 12 of this
      Lease, any other defaults by Lessor, or any defaults by Lessee by and through
      arbitration as provided below and irrevocably waive any and all rights to the
      contrary. The Parties agree to at all times conduct themselves in strict, full,
      complete and timely accordance with the terms hereof and that any attempt to
      circumvent the terms of this Arbitration Agreement shall be absolutely null
      and
      void and of no force or effect whatsoever.

     

    B. DISPUTES
      EXCLUDED FROM ARBITRATION:

    The
      following claims, disputes or disagreements under this Lease are expressly
      excluded from the arbitration procedures set forth herein: 1. Disputes for
      which
      a different resolution determination is specifically set forth in this Lease,
      2.
      All claims by either party which (a) seek anything other than enforcement or
      determination of rights under this Lease, or (b) are primarily founded upon
      matters of fraud, willful misconduct, bad faith or any other allegations of
      tortious action, and seek the award of punitive or exemplary damages,
3.
      Claims
      relating to (a) Lessor's exercise of any unlawful detainer rights pursuant
      to
      applicable law or (b) rights or remedies used by Lessor to gain possession
      of
      the Premises or terminate Lessee's right of possession to the Premises, all
      of
      which disputes shall be resolved by suit filed in the applicable court of
      jurisdiction, the decision of which court shall be subject to appeal pursuant
      to
      applicable law and 4. All claims arising under Paragraph 39
      of
      this
      Lease, which disputes shall be resolved by the specific dispute resolution
      procedure provided in Paragraph 39
      to
      the
      extent that such disputes concern solely the determination of rent.

     

    C. APPOINTMENT
      OF AN ARBITRATOR:

    All
      disputes subject to this Arbitration Agreement, shall be determined by binding
      arbitration before: o a retired judge
      of the
      applicable court of jurisdiction (e.g., the Superior Court of the State of
      California) affiliated with Judicial Arbitration & Mediation Services, Inc.
      ("JAMS"), þ
      the American
      Arbitration Association
      ("AAA") under its commercial arbitration rules, o ________________________________________________________________,
      or as may be otherwise mutually agreed by Lessor and Lessee (the
      "Arbitrator"). Such arbitration shall be initiated by the Parties, or either
      of
      them, within ten (10) days after either party sends written notice (the
      "Arbitration Notice") of a demand to arbitrate by registered or certified mail
      to the other party and to the Arbitrator. The Arbitration Notice shall contain
      a
      description of the subject matter of the arbitration, the dispute with respect
      thereto, the amount involved, if any, and the remedy or determination sought.
      If
      the Parties have agreed to use JAMS they may agree on a retired judge from
      the
      JAMS panel. If they are unable to agree within ten days, JAMS will provide
      a
      list of three available judges and each party may strike one. The remaining
      judge (or if there are two, the one selected by JAMS) will serve as the
      Arbitrator. If the Parties have elected to utilize AAA or some other
      organization, the Arbitrator shall be selected in accordance with said
      organization's rules. In the event the Arbitrator is not selected as provided
      for above for any reason, the party initiating arbitration shall apply to the
      appropriate Court for the appointment of a qualified retired judge to act as
      the
      Arbitrator.

     

    D. ARBITRATION
      PROCEDURE:

    1. PRE-HEARING
      ACTIONS. The Arbitrator shall schedule a pre-hearing conference to
      resolve procedural matters, arrange for the exchange of information, obtain
      stipulations, and narrow the issues. The Parties will submit proposed discovery
      schedules to the Arbitrator at the pre-hearing conference. The scope and
      duration of discovery will be within the sole discretion of the Arbitrator.
      The
      Arbitrator shall have the discretion to order a pre-hearing exchange of
      information by the Parties, including, without limitation, production of
      requested documents, exchange of summaries of testimony of proposed witnesses,
      and examination by deposition of parties and third-party witnesses. This
      discretion shall be exercised in favor of discovery reasonable under the
      circumstances. The Arbitrator shall issue subpoenas and subpoenas duces tecum
      as
      provided for in the applicable statutory or case law (e.g., in California Code
      of Civil Procedure Section 1282.6).

     

    2. THE
      DECISION. The arbitration shall be conducted in the city or county
      within which the Premises are located at a reasonably convenient site. Any
      Party
      may be represented by counsel or other authorized representative. In rendering
      a
      decision(s), the Arbitrator shall determine the rights and obligations of the
      Parties according to the substantive laws and the terms and provisions of this
      Lease. The Arbitrator's decision shall be based on the evidence introduced
      at
      the hearing, including all logical and reasonable inferences therefrom. The
      Arbitrator may make any determination and/or grant any remedy or relief that
      is
      just and equitable. The decision must be based on, and accompanied by, a written
      statement of decision explaining the factual and legal basis for the decision
      as
      to each of the principal controverted issues. The decision shall be conclusive
      and binding, and it may thereafter be confirmed as a judgment by the court
      of
      applicable jurisdiction, subject only to challenge on the grounds set forth
      in
      the applicable statutory or case law (e.g., in California Code of Civil
      Procedure Section 1286.2). The validity and enforceability of the Arbitrator's
      decision is to be determined exclusively by the court of appropriate
      jurisdiction pursuant to the provisions of this Lease. The Arbitrator may award
      costs, including without limitation, Arbitrator's fees and costs, attorneys'
      fees, and expert and witness costs, to the prevailing party, if any, as
      determined by the Arbitrator in his discretion.

     

    
      	
              Initials:

            	
              

            	 	
              Initials:

            	
              

            


    

     

    
      	 	
              ARBITRATION
                AGREEMENT

            	 
	 	
              Page
                1 of 2

            	 


    

    
      	©1997
              - AIR
              Commercial Real Estate Association	
            	
              FORM
                ARB-0-7/97E

            


    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Whenever
      a matter which has been submitted to arbitration involves a dispute as to
      whether or not a particular act or omission (other than a failure to pay money)
      constitutes a Default, the time to commence or cease such action shall be tolled
      from the date that the Notice of Arbitration is served through and until the
      date the Arbitrator renders his or her decision. Provided, however, that this
      provision shall NOT apply in the event that the Arbitrator determines that
      the
      Arbitration Notice was prepared in bad faith.

     

    Whenever
      a dispute arises between the Parties concerning whether or not the failure
      to
      make a payment of money constitutes a default, the service of an
      Arbitration Notice shall NOT toll the time period in which to pay the money.
      The
      Party allegedly obligated to pay the money may, however, elect to pay the
money
      "under protest" by accompanying said payment with a written statement setting
      forth the reasons for such protest. If thereafter, the Arbitrator determines
      that the Party who received said money was not entitled to such payment, said
      money shall be promptly returned to the Party who paid such money
      under protest together with Interest thereon as defined in Paragraph 13.5.
      If a
      Party makes a payment "under protest" but no Notice of Arbitration is
filed
      within thirty days, then such protest shall be deemed waived. (See also
      Paragraph 43)

     

    NOTICE:
      These forms are often modified to meet changing requirements of law and industry
      needs. Always write or call us to make sure you are utilizing the most current
      form: AIR Commercial Real Estate Association, 700 South Flower Street, Suite
      600, Los Angeles, CA 90017, Telephone No.: (213) 687-8777. Fax No.: (213)
      687-8616.

    
       

      
        
          	
                  Initials:

                	
                  

                	 	
                  Initials:

                	
                  

                


        

      

       

      
        	 	
                ARBITRATION
                  AGREEMENT

              	 
	 	
                Page 2
                  of 2

              	 


      

      
        	©1997
                - AIR
                Commercial Real Estate Association	
              	
                FORM
                  ARB-0-7/97E

              


      

       

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    FLOOR
      PLAN

     

    
      

       

      
        
          	
                  

                	 
                  	 	
                  

                
	
                     
                    Initials:

                	 	 	
                  Initials:   
                    

                


        

        
          
             

            
              
                	 	
                        EXHIBIT A

                      	 
	A.Add
                        Floor Plan	
                        Page
                          1 of 1

                      	
                        Addendum-MTG